USA—According to a Reuters report, the state of Washington has hired Munger, Tolles, and Olson LLP, a law firm, to block the US$24.6 billion Kroger-Albertsons merger announced in late 2022. 

Washington is the latest government body to oppose the biggest merger in US history. In February, Colorado’s Attorney General and the Federal Trade Commission (FTC), along with nine other AGs, filed separate lawsuits seeking to block the merger. 

According to the FTC, the merger is ‘anticompetitive’ and would create a monopoly in the grocery market. The merger will combine two of the largest grocery companies in the US, giving the new company significant leverage in the market. It would eliminate competition between the companies and increase American grocery prices. 

Henry Liu, FTC’s Bureau of Competition Director, said, “This supermarket mega merger comes as American consumers have seen the cost of groceries rise steadily over the past few years. Kroger’s acquisition of Albertsons would lead to additional grocery price hikes for everyday goods, further exacerbating the financial strain consumers across the country face today. 

Kroger released a statement dismissing the antitrust lawsuits, stating blocking the merger would hurt American consumers. The grocer reiterated it has consistently reduced prices since 2003, totaling US$5 billion resulting in a 5% reduction in the company’s gross profit margin. 

Albertsons also released a statement dismissing the lawsuits, stating that the merger would expand competition in the grocery market, lower prices for consumers, increase wages, protect jobs, and improve the customer shopping experience. 

The state of Washington will pay the law firm US$2.5 million to file the antitrust lawsuit against the retail giants. Arnold & Porter Kaye Scholer LLP will represent Kroger in the lawsuit, while Weil, Gotshal & Manges LLP will represent Albertsons. 

Kroger and Albertsons filed to remove the state AGs from the case, arguing that the officials do not have jurisdiction to sue and block the merger. However, the US Department of Justice (DoJ) allowed the AGs to be enjoined in the antitrust lawsuit.  

The DoJ argued, “The federal antitrust laws do not preempt or otherwise preclude parallel state lawsuits to protect the public from a potentially anti competitive merger. That remains true even when states seek remedies different from those sought in an existing federal lawsuit. 

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