Customers and merchants have sued Energizer Holdings Inc (ENR.N) and Walmart Inc (WMT.N) in three proposed class actions for colluding to boost disposable battery costs.
According to allegations filed Friday, Energizer agreed “under pressure from Walmart” to increase wholesale battery pricing for other retailers starting around January 2018 and order them not to undercut Walmart.
Walmart competitors that charged less at checkout faced rising wholesale pricing or being cut off by Energizer, the top U.S. throwaway battery producer.
The accusations allege that Energizer and Berkshire Hathaway-owned (BRKa.N) Duracell, which dominate 85% of the disposable battery market, raised prices beyond inflation and demand fluctuations.
Energizer established Project Atlas to lower Walmart’s pricing after Walmart canceled its exclusive battery arrangement with Sam’s Club in 2013.
“Allegations like this seriously and will respond in court as appropriate,” Walmart told Reuters. Energizer did not comment Saturday. Duracell isn’t charged.
The San Francisco, federal court complaints seek unspecified compensatory and triple damages under federal antitrust statutes and state consumer protection regulations. They also want injunctions to stop Energizer from connecting battery sales to price and force Walmart and Energizer to “dissipate” their anticompetitive behavior.
The plaintiffs claim that Energizer now has over 50% of the U.S. disposable battery market, up from 40% in 2018.
According to the accusations, an Energizer salesperson told the chief executive of Walmart rival Portable Power Inc, which had been charging cheaper pricing, why Energizer was cutting it off in an early 2021 phone conversation.
“She admitted that Energizer had adjusted its pricing policies at Walmart’s request, telling him, ‘This is 1000% about Walmart and wanting the best price,'” she said.
Portable Power leads to retailers’ lawsuits.
The U.S. District Court, Northern District of California, cases are Copeland et al. v Energizer Holdings Inc et al., No. 23-02087; Portable Power Inc v Energizer, No. 23-02091; and Schuman et al.
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