WASHINGTON — The Federal Trade Commission on Jan. 17 sued PepsiCo, Inc., alleging that the company engaged in illegal price discrimination by providing one customer, a big box retailer, with unfair pricing advantages, while raising prices for competing retailers and customers. PepsiCo, Purchase, NY, for years gave the retailer benefits and advantages, including promotional payments, while denying the same benefits to the retailer’s competitors, according to the FTC complaint.

PepsiCo, Purchase, NY, said it disputes the allegations and the partisan manner in which the lawsuit was filed. The company will “vigorously” present its case in court.

“PepsiCo’s practices are in line with industry norms, and we do not favor certain customers by offering discounts or promotional support to some customers and not others,” the company said.

A substantial portion of the FTC’s allegations were redacted in the complaint due to the legal protections afforded to both PepsiCo and the retailer, according to the FTC.

“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,” said Lina M. Khan, chair of the FTC. “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’s practices led to inflated prices for American families and denied other retailers the ability to compete, according to the FTC. PepsiCo’s conduct violated the Robinson-Patman Act, which says sellers are prohibited from engaging in price discrimination by using advertising and other allowances that are financial incentives given to retailers by manufacturers to promote a product or brand, to favor large customers over small businesses, according to the FTC.

“The lawsuit filed by the FTC is wrong on the facts and the law,” PepsiCo said. “This unprecedented expansion of the RPA reflects the FTC’s fundamental misunderstanding of the omnichannel retail marketplace and the important role that consumer product suppliers play in providing lower prices and value to consumers.”

The FTC, by a vote of three to two, authorized FTC staff to file for a permanent injunction and other equitable relief in the US District Court for the Southern District of New York.

Khan and Alvaro M. Bedoya, an FTC commissioner, said the allegations were enough reason to believe PepsiCo’s conduct was harming competition and driving up prices.

“At this highly advanced stage of the investigation, with the survival of competing businesses hanging in the balance, and with the relentless price increases American consumers have had to endure year over year due in part to Pepsi and (the retailer’s) conduct, directing staff to continue to spin their wheels in terabytes of Pepsi data looking for further confirmation of the patently illegal scheme alleged in the complaint would be an abdication of our duty,” they said in a statement.

Andrew N. Ferguson, an FTC commissioner, dissented, pointing out the ruling was made three days before the administration of President Joseph Biden ended and the administration of President Donald Trump began.

“On the eve of its eviction from power at the hands of the American voters, the commission’s Democratic majority offers one final insult to the commission, its staff and the rule of law,” Ferguson said. “In a cynical attempt to tie the hands of the incoming Trump administration, the Democratic majority launches a major lawsuit on little more than a hunch. The gaping holes in the evidence that commission staff collected in its limited investigation make it impossible to determine whether the defendant, PepsiCo, Inc. (‘Pepsi’), has broken the law.”