AG updates public on Kroger-Albertsons lawsuit

Colorado Attorney General Phil Weiser updated the public Thursday on the state’s lawsuit to permanently block the megamerger between grocery giants Kroger and Albertsons. The trial to decide whether to allow the merger transaction begins Monday.

“I held 19 listening sessions across the state, and after hearing from more than 6,100 Coloradans who will be impacted by the merger, as well as conducting a thorough investigation of the proposed merger plan, it was clear that this lawsuit would be bad for shoppers, workers, suppliers, and farmers,” Weiser said. “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.”

In October 2022, Kroger, which owns King Soopers and City Market, announced a $25 billion plan to acquire their rival Albertsons, which owns Safeway. As authorized by state law, the attorney general’s antitrust unit reviewed this proposed merger to evaluate if it is lawful, does not undermine competition, and is fair. After a yearlong investigation, Weiser filed a lawsuit in state court on February 14, 2024 to block the proposed merger. Later that month, the Federal Trade Commission announced a separate federal lawsuit to stop the merger.

On July 25, Denver District Court Judge Andrew Luxen issued an order temporarily stopping the merger while the trial proceeds, noting that, based on the evidence presented to the court, the state has a “reasonable probability” of proving its claims.

Kroger maintains that a merger will benefit customers and employees.

“Kroger is merging with Albertsons to bring lower prices to more customers, protect good-paying union grocery jobs, and deeper investments in the communities they serve,” a Kroger spokesperson said. “If the merger is blocked, grocery prices will be higher and the larger, non-union retailers Walmart, Costco and Amazon will become even more powerful and unaccountable.”

As part of the proposed merger, in an attempt to lessen the deal’s anticompetitive impacts, Kroger has presented a proposal to sell off 579 stores and other assets nationwide to C&S Wholesale Grocers, a privately held wholesale supplier that currently operates 24 stores, none of which is in Colorado. Weiser’s investigation found this plan inadequate, pointing to a similar plan that failed when Albertsons acquired Safeway in 2015.

“This merger, which will be among the biggest grocery mergers in history, besides lining the profits of mega corporations, only stands to threaten farmers, consumers, food access, union jobs and pensions, and other food system workers,” said Food to Power Executive Director Patience Kabwasa. “It will result in higher grocery bills, lost jobs, lower wages, and less competition in our local food system.”

In addition to asking the court to block the merger, the attorney general is asking the court for $1 million each in civil penalties from both companies for an illegal no-poach and non-solicitation agreement made during the 2022 King Soopers strike and uncovered during the investigation, and to bar the companies from enforcing or entering into such agreements.

The trial will begin the morning of Monday, Sept. 30, in Denver District Courtroom 414, Fourth Floor, City & County Building, 1437 Bannock Street in Denver.