In a legal battle over pricing practices, two California convenience stores have filed a class action lawsuit against PepsiCo and its subsidiary, Frito-Lay, accusing the companies of engaging in price discrimination. The lawsuit, filed on Monday, February 12, 2025, in the U.S. District Court for the Central District of California, claims that PepsiCo has provided better pricing terms to large retailers, such as Walmart and Albertsons, than to smaller, independent convenience stores. This, the plaintiffs argue, has led to higher costs for convenience stores and their customers.
The plaintiffs, Alqosh Enterprises Inc. and NMRM Inc., allege that PepsiCo’s pricing policies violate the Robinson-Patman Act, a federal antitrust law that prohibits price discrimination among competing buyers. The law, which aims to ensure fair competition, restricts a seller from offering different prices or discounts to different buyers for the same goods, unless certain conditions are met. The plaintiffs contend that PepsiCo’s actions favor larger retailers, giving them unfair pricing advantages that smaller stores cannot access.
The lawsuit also asserts that PepsiCo’s pricing practices violate California’s state competition laws, which are designed to protect consumers and promote fairness in the marketplace. According to the complaint, hundreds of convenience stores in California have been affected by these alleged discriminatory pricing strategies.
This lawsuit comes just weeks after the U.S. Federal Trade Commission (FTC) filed a similar case in New York, accusing PepsiCo of providing Walmart with preferential pricing terms in violation of the Robinson-Patman Act. PepsiCo has vehemently denied these allegations, stating that it “strongly disputes” the FTC’s claims.
In addition to seeking monetary damages, the plaintiffs are requesting a court order to stop the alleged price discrimination. Mark Poe, the attorney representing the convenience stores, argued that Frito-Lay’s discriminatory pricing has caused “millions of consumers” to pay higher prices for PepsiCo and Frito-Lay products.
As of now, PepsiCo and Frito-Lay have not responded to requests for comment regarding the latest lawsuit. Walmart, a non-party to the case, has also not issued a statement.
The Robinson-Patman Act, which had been largely dormant for several decades, has gained renewed attention under the Biden administration, with the Federal Trade Commission actively pursuing cases under the law. Legal experts suggest that this shift in enforcement could lead to more antitrust actions against large corporations accused of unfair pricing practices.
The case is officially titled Alqosh Enterprises Inc. and NMRM Inc. v. PepsiCo Inc. and Frito-Lay North America Inc., U.S. District Court, Central District of California, Case No. 2:25-cv-01327. The lawsuit is ongoing, and further developments are expected as both sides prepare for litigation.
For the plaintiffs: Mark Poe and Randolph Gaw of Gaw | Poe
For the defendants: No appearances have been made yet.
This case highlights the growing tension between large retailers and smaller businesses over fair pricing practices, as well as the increased scrutiny of antitrust laws in the current regulatory climate.
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