ST. LOUIS (FNS) -- Schnuck Markets has filed a counterclaim against Family Co. of America, operator of 23 National stores that the latter firm bought last year from Schnuck -- charging the company and its officers with libel, slander and commercial disparagement.
The counterclaim seeks $25 million in actual and $75 million in punitive damages. It is in response to the "recent flurry of disparaging statements made against Schnuck Markets," said Craig D. Schnuck, chairman and chief executive.
Earlier, Family Co. filed a $50 million claim against Schnuck, alleging fraudulent breach of contract. In a front-page article in the St. Louis Post-Dispatch, the company said that mismanagement of the stores in the nine months before they were sold to Family in March, 1996 resulted in the closing of five of them -- and that Family Co. as a whole is losing money.
Under a 1995 agreement with the Federal Trade Commission, Schnuck was required to sell the 23 stores as part of a deal in which it acquired the 57-store Canadian-owned National Super Market chain. Family Co., comprised of local investors, bought the stores and kept the National name. The contract between Schnuck and Family required Schnuck to operate the stores in good faith until they could be sold to Family Co.