The Pepsi and Walmart lawsuit is a consolidated federal class action filed in December 2025 accusing PepsiCo of giving Walmart secretly preferential wholesale prices and promotional support while inflating costs for every other retailer, and accusing Walmart of participating in the arrangement. The consolidated case, In re Branded Beverage Antitrust Litigation, is pending in the U.S. District Court for the Southern District of New York. Both PepsiCo and Walmart deny the allegations.
What the Lawsuit Alleges
The complaints describe a scheme with several connected pieces. PepsiCo allegedly sold soft drinks to Walmart at wholesale prices significantly lower than those offered to competing retailers. It allegedly gave Walmart promotional payments and marketing support to push shelf prices down, while cutting or withholding the same support from competitors. And it allegedly shared non-public pricing data with Walmart so both companies could track what rival stores were charging and keep Walmart’s advantage intact.
The evidence cited in the complaints comes largely from PepsiCo’s own internal communications. One internal message stated that “stay[ing] focused on our price gap … is how we win with Walmart.” According to the complaints, PepsiCo treated maintaining Walmart’s price advantage as a foundational business commitment and monitored competitor pricing across the market to enforce it.
The plaintiffs allege violations of Section 1 of the Sherman Antitrust Act, which prohibits agreements that restrain trade, along with various state antitrust and consumer protection laws and unjust enrichment. The retailer complaint filed on behalf of Redner’s Markets also invokes Sections 4 and 16 of the Clayton Antitrust Act.
The Food Lion Example
The most concrete example in the complaints involves Food Lion, the grocery chain owned by Ahold Delhaize. Internal PepsiCo documents identified Food Lion as the “worst offender” for “beating [Walmart] in price.” PepsiCo allegedly responded by developing a multi-year plan to raise Food Lion’s wholesale costs faster than the rest of the market and by cutting the chain’s promotional allowances, with the goal of forcing Food Lion’s shelf prices back up. The FTC has described this pattern as a “waterbed effect”: price discrimination that pushes costs higher at every retailer except the favored one.
Where the Evidence Came From
The lawsuits were built on documents unsealed from a separate, now-dismissed federal case. On January 17, 2025, the Federal Trade Commission had voted 3–2 to sue PepsiCo under the Robinson-Patman Act, a 1936 statute that bars manufacturers from offering discriminatory pricing or promotional benefits to favored buyers. That case, FTC v. PepsiCo, Inc., was filed in the Southern District of New York three days before President Trump’s inauguration.
On May 22, 2025, the newly Republican-controlled FTC voted 3–0 to dismiss the suit without prejudice. Chairman Andrew Ferguson called the original filing “a nakedly political effort” based on “little more than a hunch.” Commissioner Mark Meador described it as “possibly the most reckless and irresponsible use of antitrust enforcement resources” he had witnessed. The commissioners noted, however, that the Robinson-Patman Act remains “a valid law that the Commission is constitutionally obliged to enforce.”
The Institute for Local Self-Reliance then moved to unseal the heavily redacted FTC complaint. PepsiCo and the U.S. Chamber of Commerce opposed the effort. On December 5, 2025, Judge Jesse M. Furman ruled that the complaint would be mostly unsealed, and a largely unredacted version became public around December 11–12, 2025. Private lawsuits followed within days.
Who Is Suing and Who Is Covered
The consolidated litigation has two tracks. One is for consumers who bought PepsiCo products from retailers other than Walmart; that proposed nationwide class reaches back to January 1, 2015. The products at issue include Pepsi, Mountain Dew, Aquafina, Gatorade, Lipton, Pure Leaf, and bottled Starbucks drinks. The other track is for retailers that bought directly from PepsiCo, including Redner’s Markets, Emporium Food Store, and Fargo Stopping Center; that proposed class covers retailers nationwide going back to at least 2018.
The first suit, Gelbspan et al. v. PepsiCo, Inc. et al., was filed on December 15, 2025, followed by Donovan et al. v. PepsiCo on December 19 and Redner’s Markets, Inc. v. PepsiCo on December 23. On February 26, 2026, Judge Cathy Seibel consolidated ten related cases for pretrial purposes under the caption In re Branded Beverage Antitrust Litigation.
Where the Case Stands Now
The litigation is in its early stages. As of mid-2026, no motions to dismiss have been filed. Under the schedule set at the February 26, 2026 status conference, the plaintiffs are to file consolidated amended class action complaints, and the defendants will then have 60 days to file any motions to dismiss. The most recent noted docket activity was a May 15, 2026 order granting a motion to seal certain filings. No class has been certified, and no trial date has been set. Consumers and retailers who believe they were affected do not need to act now to preserve their potential membership in a class; if the case proceeds and a class is certified, notice procedures will follow.
What PepsiCo and Walmart Say
PepsiCo said it “continues to operate in compliance with applicable laws and remains committed to providing all customers with fair, competitive, and non-discriminatory pricing, discounts and promotional value, regardless of size or channel.”
Walmart said it was “aware of the litigation” and “committed to negotiating on behalf of our customers so we can deliver value and everyday low prices.” Walmart also pointed to the FTC’s voluntary dismissal of its own case, calling the Robinson-Patman Act “a controversial statute that the antitrust community has widely argued would ultimately harm customers.”
Why the Case Matters Beyond the Parties
The FTC’s original suit against PepsiCo was one of two Robinson-Patman Act enforcement actions filed in the final weeks of the Biden administration, the first such federal suits in more than a generation. Former FTC Chair Lina Khan championed reviving the statute, arguing it was needed to prevent large chains from driving independent retailers out of business. The second case targeted Southern Glazer’s Wine and Spirits over allegations that it charged small businesses more than national chains for identical products.
Even after dismissing the PepsiCo suit, Chairman Ferguson and Commissioner Meador have said they do not treat the Robinson-Patman Act as dead. For now, though, the private class action in In re Branded Beverage Antitrust Litigation is the venue where the allegations against PepsiCo and Walmart will actually be tested.