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The battle waged by the state of Washington to stop the proposed merger of Kroger and Albertsons is now playing out in a King County courtroom.
The state filed suit to block the merger, arguing it would create the largest supermarket chain in U.S. history and raise prices for shoppers.
The two companies said the merger would bring prices down. Some of the brands Kroger owns include QFC and Fred Meyer, while Albertsons also owns Safeway and Haggen stores.
In a statement to KOMO News, Kroger said they already have plans in place to lower prices.
But UFCW 3000, the union that represents grocery store workers, is fighting back. They held a rally outside the courthouse during the lunch recess, claiming a merger would hurt their workers and their customers.
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“I’m the person who worked with the public and they worked to come through my line and the public to tell you the truth,” said Yasmin Ashur, a checker at the Port Orchard Albertsons.
Ashur said those customers tell her when they go to Walmart or another store to find something cheaper.
“Some prices are raised up to a dollar an item. One week it was $5.99 the next week when they come back it’s like $7.99 or $6.99,”Ashur added. “So that’s kind of really shocking to them. Why the price gouging?”
In the statement to KOMO News, Kroger said that they would start with lower prices on day one of the merger on 28 items. Kroger added that they plan to reduce prices on another 650 items within 90 days.
RELATED |Kroger and Albertsons prepare to make final merger plea in federal court
“What I believe are the statements they actually made in writing when they were contemplating this merger where they acknowledge their own executives that prices would not go down,” WA Attorney General Bob Ferguson said after the end of the union rally he attended.
Ferguson said that those emails would be part of their evidence along with testimony from grocery executives called as witnesses.
Brad Street, the Seattle Division Chief for Albertsons, was the first witness called to the stand.
Street was questioned about a number of emails entered into evidence between himself and other company executives regarding their pricing strategies and philosophy.
“That’s our goal to always be better than Fred Meyer and QFC and other competitors we compete against,” Street said in court, referring to an email directing him to “find a balance that passes on cost increases.”
Ferguson’s team plans to show the judge several internal communications that they claim show intent to create a monopoly.
The company specifically promised more than $100 million in investments, just in Washington state, by lowering prices.
Kroger said that they compete with anybody who sells food and grocery products, including club stores, discount and dollar stores, natural and organic stores, and traditional neighborhood grocery stores.
The company said they “must expand, adapt and most importantly, continue to lower prices to compete with global behemoths like Walmart, Costco and Amazon.”
This trial to determine if the merger will lessen competition is expected to last into October.
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