Walmart, Energizer must face lawsuits over battery prices

Energizer Holdings

12/02/2024 15:38

By Jonathan Stempel
       NEW YORK, Feb 12 (Reuters) - Walmart  WMT.N  and
Energizer  ENR.N  were ordered by a U.S. judge to face lawsuits
by consumers and retailers accusing them of violating antitrust
law by conspiring to raise prices of disposable batteries.
    In a decision on Friday, U.S. District Judge P. Casey Pitts
said plaintiffs in the three proposed class actions plausibly
alleged that in exchange for preferred treatment at its stores,
Walmart pressured Energizer to inflate wholesale battery prices
and keep other retailers from undercutting it on price.
    The plaintiffs said the alleged conspiracy began in 2018,
and left other retailers at risk of being cut off by Energizer,
the largest U.S. disposable battery maker, if they charged less
than Walmart, the world's largest retailer.
    They said it also led to higher prices at checkout from
Energizer and Berkshire Hathaway-owned  BRKa.N  Duracell, which
account for 85% of U.S. battery sales.
    According to the complaints, 24-packs of Energizer Max
Alkaline AAA batteries sold at Walmart for an average $16.24 in
the summer of 2019, about one-third higher than a year earlier.
    Pitts, based in San Jose, California, said the accusations
appeared "more consistent" with an agreement to fix prices than
with independent decision-making by Energizer, which one might
expect to prefer lower retail prices to maximize sales.
    The judge quoted an Energizer sales representative telling
the chief executive of the plaintiff retailer Portable Power
that Energizer's pricing policies were "1000% about Walmart."
    Energizer declined to comment, saying the St. Louis-based
company does not discuss pending litigation. Walmart, based in
Bentonville, Arkansas, did not immediately respond to requests
for comment. Duracell is not a defendant.
    In seeking a dismissal, the defendants called Energizer's
decisions to contract exclusively with Walmart and set minimum
retail prices to frustrate discounters "entirely consistent with
rational, unilateral business conduct."
    Todd Schneider, a lawyer for the plaintiff retailers and
some of the plaintiff consumers, said: "We look forward to
bringing this matter to trial."
    The lawsuits seek compensatory and triple damages for
violations of federal and state antitrust laws and state
consumer protection laws.
    The cases in the U.S. District Court, Northern District of
California, are: Copeland et al v Energizer Holdings Inc et al,
No. 23-02087; Portable Power Inc v Energizer Holdings Inc et al,
No. 23-02091, and Schuman et al v Energizer Holdings Inc et al,
No. 23-02093.

 (Reporting by Jonathan Stempel in New York, Editing by Franklin
Paul)
 ((jon.stempel@thomsonreuters.com; +1 646 223 6317; Reuters
Messaging: jon.stempel.thomsonreuters.com@reuters.net))