A PYMNTS Company

DOJ Supports Colorado’s Efforts to Block Kroger-Albertsons Merger

 |  May 7, 2024

In a legal battle over the proposed merger between retail giants Kroger and Albertsons, the United States Justice Department has thrown its weight behind Colorado’s bid to thwart the $24.6 billion deal.

According to Bloomberg, Colorado initiated legal proceedings against the merger, contending that it would significantly harm competition in the grocery market. The state pursued its case independently from the Federal Trade Commission (FTC) and a coalition of eight other states plus Washington, DC, which are challenging the merger in federal court in Oregon.

Kroger and Albertsons attempted to dismiss Colorado’s lawsuit, arguing that the state lacked the authority to seek a nationwide injunction. However, the Justice Department, in a filing with the Denver district court, asserted that federal laws do not preclude states from pursuing their own antitrust cases, even if they seek different remedies than those pursued at the federal level.

“The federal antitrust laws do not preempt or otherwise preclude parallel state lawsuits to protect the public,” the Justice Department stated in its filing.

Related: Kroger-Albertsons Merger Could Give Walmart Shoppers A Low-Cost Grocery Alternative

The department cited recent antitrust lawsuits against tech giants Google and Meta Platforms Inc. as examples of states independently pursuing legal action, per Bloomberg.

However, Kroger’s legal representative, Matthew Wolf, criticized the Justice Department’s position, noting what he saw as a contradiction from a previous case involving T-Mobile USA Inc. and Sprint. In that instance, the Justice Department settled with the companies, but several states sued to block the merger.

In a comment to Bloomberg, Colorado’s lawyer, Conor May, clarified that the Justice Department’s stance in the T-Mobile case pertained to federal antitrust law, whereas the current dispute relies on Colorado’s state antitrust regulations.

Judge Andrew J. Luxen, presiding over the case, has yet to indicate when he might rule on Kroger and Albertsons’ motion to dismiss Colorado’s lawsuit. However, he has scheduled a hearing in August to consider the state’s request for a preliminary injunction against the merger, citing potential harm to residents.

Source: Bloomberg