Grocery Wholesalers Face Anticompetitive Lawsuit

Grocery wholesalers SuperValu Inc. and C&S Wholesale Grocers face a class action lawsuit alleging the two companies "conspired to allocate markets, customers and territories" in New England and the Midwest for the purpose of "fixing, raising, andmaintaining prices." DeLuca's Corp., a Boston grocer, filed the complaint on June 19.

The complaint contends that in 2003 SuperValu agreed to exit the New England market in exchange for C&S's agreement to refrain from competing in the Midwest. As a result, prices in both regions that had benefitted from competition between the two entities have been inflated and supply reduced.

SuperValu is the dominant wholesaler in the Midwest, with 2007 sales of more than $9 billion. C&S reported sales of more than $19 billion in 2007, and is the ...

Grocery wholesalers SuperValu Inc. and C&S Wholesale Grocers face a class action lawsuit alleging the two companies "conspired to allocate markets, customers and territories" in New England and the Midwest for the purpose of "fixing, raising, andmaintaining prices." DeLuca’s Corp., a Boston grocer, filed the complaint on June 19.

The complaint contends that in 2003 SuperValu agreed to exit the New England market in exchange for C&S’s agreement to refrain from competing in the Midwest. As a result, prices in both regions that had benefitted from competition between the two entities have been inflated and supply reduced.

SuperValu is the dominant wholesaler in the Midwest, with 2007 sales of more than $9 billion. C&S reported sales of more than $19 billion in 2007, and is the dominant grocery wholesaler in New England.

SuperValu and C&S previously have referred to the agreement as an "asset swap," in which SuperValu exchanged its New England properties for Midwest distribution center obtained by C&S from another bankrupt grocery wholesaler. DeLuca contends this an inaccurate classification of the move in part because C&S closed the distribution centers received in the swap shortly after the deal was completed.

The class action lawsuit is requesting three times the amount of actual damages that resulted from this anticompetitive agreement. Specific figures were not disclosed.

SuperValu and C&S have 20 days from receipt of the summons to file a response.

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events

2

articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

1

article
left

You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.