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Walmart and Energizer Must Face Antitrust Suits Over Price-Fixing

 |  February 12, 2024

Retail giant Walmart and leading battery manufacturer Energizer have been directed by a US judge to confront lawsuits filed by consumers and retailers. The suits allege a conspiracy aimed at inflating prices of disposable batteries, violating antitrust laws in the process, reported Reuters.

US District Judge P. Casey Pitts delivered the decision on Friday, allowing three proposed class actions to proceed. Plaintiffs assert that Walmart leveraged its position as the world’s largest retailer to pressure Energizer into artificially inflating wholesale battery prices. This alleged scheme purportedly aimed to maintain higher prices and deter other retailers from undercutting Walmart.

The plaintiffs contend that this collusion began in 2018, resulting in a scenario where competing retailers risked being marginalized by Energizer if they dared to offer batteries at prices lower than those demanded by Walmart. This maneuvering, according to the complaints, led to an increase in prices not only from Energizer but also from Berkshire Hathaway-owned Duracell, which jointly dominate 85% of the U.S. battery market.

Specifically, the complaints cite the case of 24-packs of Energizer Max Alkaline AAA batteries, which reportedly saw an average price hike to $16.24 at Walmart during the summer of 2019, representing a notable one-third increase from the previous year.

Read more: Energizer, Walmart Face Antitrust Class Action For Battery Price Hikes

Judge Pitts, presiding in San Jose, California, expressed skepticism regarding the defendants’ claims of independent decision-making by Energizer. He noted that the accusations appeared more indicative of a concerted effort to fix prices, as opposed to individual business strategies aimed at maximizing sales.

An excerpt from the proceedings quoted an Energizer sales representative affirming that the company’s pricing policies were heavily influenced by Walmart. Energizer, based in St. Louis, declined to provide comment, citing its policy not to discuss ongoing litigation. Similarly, Walmart, headquartered in Bentonville, Arkansas, remained silent in response to requests for comment. Notably, Duracell is not named as a defendant in these lawsuits.

In their bid for dismissal, the defendants argued that Energizer’s decisions to exclusively contract with Walmart and impose minimum retail prices were legitimate business actions. However, Todd Schneider, representing the plaintiff retailers and some consumers, expressed eagerness to proceed to trial, seeking compensatory and triple damages for alleged violations of federal and state antitrust laws along with state consumer protection laws.

This legal battle underscores the significance of fair competition within the retail sector and the potential ramifications of alleged antitrust violations.

Source: Investing