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It’s been quite a busy few weeks for the proposed Kroger-Albertsons merger, full of lawsuits, hearings, and renewed concerns of grocery price-gouging.
This week, Kroger sued the Federal Trade Commission, arguing that its proceeding in administrative court is unconstitutional and the matter should only be heard in federal court.
The preliminary injunction, filed in the US District Court, Southern District of Ohio, argues that the FTC’s administrative proceeding violates Articles II and III in the Constitution. Kroger said in a statement that challenging the merger in administrative and federal courts is “an inappropriate attempt to receive multiple opportunities to litigate the same issues,” while Kroger Chairman and CEO Rodney McMullen said the grocer is prepared to defend the deal in federal court. The FTC declined to comment to Retail Brew.
In February, the FTC, along with eight states, sued to block the proposed merger, issuing both administrative and federal complaints. The evidentiary hearings for the federal court in the District of Oregon will begin on Monday.
Kroger is still facing other legal battles, too. After Colorado Attorney General Phil Weiser filed a lawsuit in February claiming the merger violated the Colorado State Antitrust Act of 2023, a judge from the Denver District Court last month granted a preliminary injunction that temporarily halted it, canceling an August 12 hearing. Judge Andrew J. Luxen will now preside over a two-week trial on September 30, and the deal can’t close until five days after the ruling.
But that’s not the only recent merger-related news.
Last week, Vice President Kamala Harris introduced her economic agenda, with plans to instruct the FTC to penalize “big corporations” engaged in grocery price gouging. This comes after US Senators Elizabeth Warren and Bob Casey announced they’d sent a letter to McMullen addressing concerns that Kroger used electronic shelving labels to “surge grocery prices and exploit consumers,” which Kroger has denied. Kroger also claimed last week it will cut grocery prices by $1 billion if the deal closes.
Kroger and Albertsons also lost the support of the United Food and Commercial Workers Union Local 555, the country’s only labor union to support the deal, after Portland Metro area workers at Kroger-owned Fred Meyer voted to authorize an Unfair Labor Practice Strike last week.
And ICYWW how much this is costing Kroger and Albertsons, Bloomberg reported last week that they have spent about $864 million in merger-related fees since 2022.