Kroger files "Hail Mary" lawsuit against the FTC to save merger
In a last-ditch effort to chip away at the Federal Trade Commission's authority and save its $24.6 billion acquisition of Albertsons, Kroger flipped the script and sued the agency on Monday, claiming its challenge of the merger is unconstitutional.
Kroger is test driving a new Supreme Court ruling from June, which limited the Securities and Exchange Commission’s use of in-house tribunals to bring enforcement actions in securities fraud cases. (That case pertained to George Jarkesy, a hedge fund manager accused of making misleading public statements.)
The move is part of a challenge against the administrative state from corporate America. It's been called a "political stunt" and a “Hail Mary" by some antitrust experts.
There are two cases in play here: The FTC filed an administrative complaint challenging the merger in February, as well as an injunction filed in Oregon's federal court blocking the merger while the the other action is underway.
A hearing on the injunction is schedule for next week. A trial in the FTC's in-house court — which is where Kroger is arguing that its acquisition is legal and not anti-competitive — will happen after that.
To be clear, Kroger is not claiming the FTC as an agency is unconstitutional, though there is a trend of companies claiming their regulators shouldn't even exist. Instead, Kroger's argument is a little more boring, which is that this challenge should happen in a regular court, not in an in-house FTC court.
The move is part of a challenge against the administrative state from corporate America. It's been called a "political stunt" and a “Hail Mary" by some antitrust experts.
There are two cases in play here: The FTC filed an administrative complaint challenging the merger in February, as well as an injunction filed in Oregon's federal court blocking the merger while the the other action is underway.
A hearing on the injunction is schedule for next week. A trial in the FTC's in-house court — which is where Kroger is arguing that its acquisition is legal and not anti-competitive — will happen after that.
To be clear, Kroger is not claiming the FTC as an agency is unconstitutional, though there is a trend of companies claiming their regulators shouldn't even exist. Instead, Kroger's argument is a little more boring, which is that this challenge should happen in a regular court, not in an in-house FTC court.
