FTC dismisses lawsuit against Pepsi for price discrimination

In the United States, the Federal Trade Commission (FTC) voted on May 22, 2025, to dismiss a regulatory lawsuit that had been filed during the final days of the Biden administration against PepsiCo. The lawsuit accused the company of engaging in price discrimination by offering lower prices to large retailers, which they alleged could distort market competition. Since the departure of the Democratic commissioners under the Trump administration, the FTC's current panel is now composed solely of Republicans, which has significantly shifted the agency’s stance on such matters. Andrew Ferguson, now FTC Chairman and a previous dissenter against the lawsuit, reiterated his belief that the case was politically motivated and lacked substantial evidence, expressing a commitment towards supporting consumer welfare instead. The dismissed lawsuit had drawn mixed reactions from various stakeholders in the industry. Critics, particularly from within the Democratic Party, contended that the lawsuit was part of a broader strategy to combat price-gouging practices alleged to be contributing to inflation. They have taken issue with major corporations, including warnings from retailers like Walmart about impending price hikes due to tariffs. Democrats have not only criticized the dismissal but have also sent correspondence to Pepsi, seeking clarification on its pricing strategies as a continued focus on fair pricing practices amid economic recovery. The political environment surrounding this decision indicates significant partisan divides, as the current commission comprises three members from the Republican Party without representation from Democrats. The FTC vote to dismiss was unanimous, reflecting a reshaped regulatory ethos under a Republican-dominated leadership. The action contrasts sharply with the lawmakers’ insistence on revisiting consumer rights in the context of pricing allegations, with pressures mounting for accountability among corporations like PepsiCo. While the FTC aims to redirect focus back onto consumer protection, the decision illustrates the complexities of regulatory frameworks shaped by political influences and the contentious narrative around inflationary practices in the economy. The dismissal highlights concerns over the agency's ability to enact regulatory policies without it being overshadowed by political motivations or influences, setting the stage for future debates around corporate pricing strategies and the role of government oversight in maintaining competitive markets.