Pepsi class action alleges price discrimination against convenience stores

Pepsi class action lawsuit overview:

• Who: Alqosh Enterprises Inc. and NMRM Inc. filed a class action lawsuit against PepsiCo Inc. and its subsidiary Frito-Lay North America Inc.
• Why: The plaintiffs claim Pepsi and Frito-Lay engaged in price discrimination by charging higher prices to independent convenience stores than to chain grocery stores for Frito-Lay snack chips.
• Where: The class action lawsuit was filed in California federal court.

PepsiCo Inc. and its subsidiary Frito-Lay North America Inc. engaged in price discrimination by charging higher prices to independent convenience stores than to chain grocery stores for Frito-Lay snack chips, a new class action lawsuit alleges.

Plaintiffs Alqosh Enterprises Inc. and NMRM Inc., a pair of convenience store operators, claim Pepsi and Frito-Lay are violating the Robinson-Patman Act (RPA), which prohibits suppliers from charging different prices to competing customers for the same products.

The plaintiffs argue PepsiCo and Frito-Lay charged independent convenience stores far higher net prices for popular snack chip brands — including Doritos, Lay’s, Cheetos, Fritos and Ruffles — than they charged to chain grocery stores, such as Albertsons, Walmart, Target and Safeway.

“For years, Frito-Lay has continuously violated the RPA by charging independent convenience stores far higher net prices for those brands of snack chips than it charges to chain grocery stores,” the Frito-Lay class action says. 

Alqosh Enterprises and NMRM seek to represent a class of independently owned California convenience stores that purchased Frito-Lay snack chips at higher prices than chain grocery stores at least throughout the four years prior to the filing of the complaint. 

Pepsi caused independent convenience stores to lose millions of dollars, class action says

The plaintiffs argue the alleged price discrimination caused independent convenience stores to lose tens of millions of dollars in Frito-Lay chip sales over the past four years.

“Frito-Lay engaged in direct and indirect price discrimination against Plaintiffs and the class by selling snack chips to them at far higher net prices than Frito-Lay charged to Chain Groceries,” the Frito-Lay class action states.

In addition to allegedly violating the RPA, the convenience stores argue Pepsi and Frito-Lay violated California’s Unfair Practices Act and Unfair Competition Law.

The plaintiffs demand a jury trial and request injunctive relief and an award of compensatory and treble damages for themselves and all class members. 

The Federal Trade Commission filed a complaint against Pepsi on Jan. 17 over claims the company gave Walmart better terms and promotional payments than smaller competitors.

Have you purchased a Frito-Lay snack for a higher price at an independent convenience store? Let us know in the comments.

The plaintiffs are represented by Mark Poe, Randolph Gaw, Victor Meng and Flora Vigo of Gaw Poe LLP.

The PepsiCo class action lawsuit is Alqosh Enterprises Inc., et al. v. PepsiCo Inc., et al., Case No. 2:25-cv-01327, in the U.S. District Court for the Central District of California.

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