Colorado case against Kroger, Albertsons merger begins

The third trial challenging the proposed Kroger, Albertsons merger began Monday in a Denver district court, but the case differs from separate lawsuits brought by the Federal Trade Commission and the Washington attorney general as it seeks $1 million each in civil penalties from the two grocers.

Similar to the FTC and Washington cases, the lawsuit filed in February by Colorado Attorney General Phil Weiser argues that the proposal to divest 579 stores to C&S Wholesale Grocers is “inadequate” and the merger will hurt consumers and workers. 

Weiser’s lawsuit additionally accuses the two grocers of violating Colorado antitrust law by agreeing not to poach workers or solicit pharmacy customers during a worker strike by employees of Kroger-owned King Soopers in 2022.

“In addition to challenging this merger, we are also suing the two companies for a no-poach agreement that harmed workers and blatantly violated antitrust law,” Weiser said in February. “No-poach agreements stifle worker mobility and depress wages and non-solicitation agreements harm consumers and raise prices.”

Kroger and Albertsons have both denied the accusation, releasing a joint statement in February that calls the alleged agreement a “mischaracterization of the facts.”

“Employees at both companies regularly join our teams from — and exit our companies for opportunities to work at — Albertsons, Kroger, Walmart, Amazon, Costco, and other retailers as well as restaurants, food service companies, convenience stores, warehouses, and more,” the two retailers said in February. 

On Sept. 26, Weiser’s office released a statement arguing that some 6,100 Coloradans would be negatively impacted by the merger and it would be bad for “shoppers, workers, suppliers, and farmers.”

“Nearly two years since the companies announced the merger, we finally have the chance to prove in court why this deal would be bad for Colorado and the country,” Weiser said in the recent press release. 

The two-week Colorado case was originally scheduled to begin on Aug. 12, but Judge Andrew J. Luxen, who will oversee the trial, approved a preliminary injunction in July, which moved the case to the end of September.  

Union workers in Colorado represented by United Food and Commercial Workers Local 7, UFCW Local 1564, Teamsters Local 455, and Rocky Mountain Farmers Union held a rally outside the courthouse on Monday.

“UFCW Local 7 and supporters are speaking out against the merger because it could lead to job losses; food and pharmacy deserts; negative economic impacts on the supply chain including farmers, ranchers, and transport; and less power for workers at the negotiating table,” the union said in a press release. 

The cases brought by the FTC and Washington are ongoing, but a decision in the federal case could come as soon as this week. In Portland, Ore., Judge Adrienne Nelson gave all parties until Sept. 27 to submit final written arguments.