Court: Chains Must Face Suit for Strike Collaboration

SAN FRANCISCO — The Ninth U.S. Circuit Court of Appeals here said Tuesday that three California supermarkets must face an antitrust lawsuit over a mutual strike assistance agreement they signed in 2003. The decision overturns a lower court ruling of a suit filed by the state six years ago.

SAN FRANCISCO — The Ninth U.S. Circuit Court of Appeals here said Tuesday that three California supermarkets must face an antitrust lawsuit over a mutual strike assistance agreement they signed in 2003. The decision overturns a lower court ruling of a suit filed by the state six years ago.

The lawsuit involves Ralphs, a division of Kroger Co. [2], Cincinnati; Vons, a division of Safeway [3], Pleasanton, Calif.; and Albertsons, which was an independent chain at the time of the labor dispute but is now a division of Minneapolis-based Supervalu [4].

The appellate court voted 2 to-1 to reject the chains' argument that the agreement — in which the chains agreed to share revenues if one of them was struck — wasn't anti-competitive. According to Judge Stephen Reinhardt, “Reducing workers' wages and benefits is hardly an objective that would justify a violation of our antitrust laws.”