U.S. Merger Review in the Grocery Store Business ABA Section of International Law Committee on International Antitrust Law Darren S. Tucker, O’Melveny & Myers, Washington, DC May 21, 2008 U.S. Grocery Store Merger Review FTC’s Current Definition of a Supermarket
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ABA Section of International Law
Committee on International Antitrust Law
Darren S. Tucker, O’Melveny & Myers, Washington, DC
May 21, 2008
FTC’s Current Definition
of a Supermarket
“A full-line retail grocery store with annual sales of at least $2 million that carriers a wide variety of food and grocery items in particular product categories, including bread and dairy products, refrigerated and frozen food and beverage products, fresh and prepared meats and poultry, producing, including fresh fruits and vegetables, shelf-stable food and beverage products, including canned and other types of packaged products, staple foodstuffs, which may include salt, sugar, flour, sauces, spices, coffee and tea, and other grocery products, including nonfood items such as soaps, detergents, paper goods, other household products, and health and beauty aids.” — A&P/Pathmark, Docket No. C-4209.
1 An exception was Wal-Mart’s acquisition of Supermercados Amigo in Puerto Rico, in
which the FTC alleged a product market consisting of supermarkets and club stores.
Judge skeptical of FTC’s market definition from the start
“By buying [Wild Oats] … we eliminate forever the possibility of Kroger, Super Value, or Safeway using their brand equity to launch a competing national/organic food chain rival to us.”
By buying Wild Oats “we will … avoid nasty price wars … [that] will harm gross margins and profitability.”
Wild Oats “may not be able to defeat us but they can still hurt us.”
Documents were a key form of evidence for the FTC
“[T]his case hinges—almost entirely—on the proper definition
of the relevant market.” – District Court