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Published reports say that Kroger, Safeway and Albertsons are appealing a federal court ruling that permitted an antitrust case against the companies to proceed.

The case concerns a profit and pain-sharing arrangement agreed to by the companies before the strike/lockout that affected all three chains beginning in late 2003. The deal said that if the strike/lockout affected one or two of them to a greater extent, the other chain or chains would not be able to benefit – an arrangement that the chains said was allowed under federal rules saying that antitrust law should not be applied to labor-oriented disputes.

However, California Attorney General Bill Lockyer said that the deal led to higher grocery prices and was, in fact, an antitrust violation. He sued the chains last year and the federal court agreed to let the case go forward.

The appeal by the chains will be heard by a federal appeals court, though no timetable for a hearing has been set.
KC's View:
We think that if the courts rule against the chains, it is only going to look like they indeed were focused on keeping prices artificially high – which would be seen as anti-consumer.

And that’s never a good brush with which to be painted.