The state of Colorado’s lawsuit to block the $24.6 billion Kroger-Albertsons merger will proceed, as Denver District Court Judge Andrew Luxen has denied Kroger’s motion to dismiss the case. This decision mirrors a similar ruling in Washington state in April, where King County Superior Court Judge Marshall Ferguson rejected the companies’ motion to dismiss the state attorney general’s antitrust lawsuit.
These state lawsuits are separate from a lawsuit filed in February by the Federal Trade Commission, along with the attorneys general of eight states and the District of Columbia. In both the Washington and Colorado cases, Kroger and Albertsons argued that the states lack jurisdiction to sue because the grocers operate in multiple states. Historically, state attorneys general have collaborated with the FTC to block such mergers, which Kroger and Albertsons’ legal team emphasized in their defense.
“To defendants’ knowledge, this litigation is only the second time state attorneys general have ever sought to enjoin a nationwide merger before the FTC proceeding has even commenced …” the motion said. “Whatever the scope of Colorado’s independent interests, they are narrower than and subordinate to the national interests being pursued by the FTC. The Colorado attorney general could have joined the FTC’s suit (as eight other state attorneys general did) but he chose to go at it alone. That may be his prerogative, but the federal proceeding should still take priority.”
Luxen, in his denial of the motion, noted that dismissing the state of Colorado’s case “would be at odds with numerous rulings recognizing states as co-equal antitrust enforcers.”
The Colorado lawsuit differs from the FTC and Washington state lawsuits by alleging that Kroger and Albertsons violated the Colorado State Antitrust Act in January 2022, during a 10-day strike by union workers at Kroger-owned King Soopers. The Colorado case contends that during this strike, Kroger and Albertsons entered into an agreement not to poach each other’s workers and not to solicit King Soopers’ pharmacy customers.
“Such no-poach and non-solicitation agreements are illegal under the Colorado State Antitrust Act because they are agreements to not compete,” Colorado Attorney General Phil Weiser said earlier this year.
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