Ralphs Grocery, Albertson’s, Vons Must Face Antitrust Lawsuit

Three California supermarket chains must face an antitrust lawsuit over an agreement in 2003 to share profit in case any of the three was singled out for a strike, a U.S. appeals court ruled.

The court in San Francisco overturned a lower court ruling that the agreement, reached during a conflict with the companies’ unions, didn’t violate antitrust law. The appellate panel’s 2-to-1 ruling rejected the argument by Ralphs Grocery, Albertson’s and Vons that the agreement wasn’t anticompetitive because it lowered prices for consumers by reducing labor costs.

“It is a primary object of our nation’s laws to protect the rights and interests of working persons, and to enable them to obtain a fair and decent wage through collective action,” Judge Stephen Reinhardt, writing for the majority, said. “Reducing workers’ wages and benefits is hardly an objective that would justify a violation of our antitrust laws.”

California sued the three grocers six years ago, saying the so-called mutual strike assistance agreement violated federal antitrust law and led to higher prices. A 141-day strike and lockout at the companies’ Southern California stores was the longest in the industry’s history and was mainly over proposals requiring workers to share health-care costs and establish a two-tier pay system.

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