New York, Jan 17 (AP) The Federal Trade Commission sued PepsiCo on Friday, alleging that it has engaged in illegal price discrimination by giving unfair price advantages to one big-box retailer at the expense of other vendors and consumers.

The benefiting customer wasn't named in an FTC statement about the lawsuit. But a source familiar with the case, who asked not to be named because they were not authorised to it, said the retailer was Walmart.

Also Read | 'Sex for Shifts' Scandal Rocks McDonald's UK: Pressure Mounts on Fast Food Giant As Teen Employees Claim Managers Offered Extra Work Hours in Exchange for Sex.

PepsiCo said the lawsuit “is wrong on the facts and the law” and misunderstands the way consumer product companies help retailers provide lower prices.

“PepsiCo strongly disputes the FTC's allegations, and the partisan manner in which the suit was filed. We will vigorously present our case in court,” the company said in a statement.

Also Read | TikTok Ban Upheld: US Supreme Court Upholds Law Requiring Ban on Chinese App Beginning Sunday.

The FTC said PepsiCo's practices included making promotional payments to Walmart but not to large grocery chains or independent convenience stores. The FTC said that allows Walmart to lower its prices, but forces Americans to pay inflated prices for PepsiCo products unless they shop at Walmart.

“When firms like Pepsi give massive retailers a leg up, it tilts the playing field against small firms and ultimately inflates prices for American consumers,” FTC Chair Lina Khan said in the statement. “The FTC's action will help ensure all grocers and other businesses — no matter the size — can get a fair shake and compete on the merits of their skill, efficiency, and talent.”

PepsiCo said its practices “are in line with industry norms.”

“We do not favour certain customers by offering discounts or promotional support to some customers and not others,” the company said.

The FTC sued PepsiCo under the rarely enforced 1936 Robinson-Patman Act. The FTC said the act prohibits companies from using promotional incentive payments to favour large customers over smaller ones. (AP)

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)