The California Attorney General filed an antitrust suit Monday against three supermarket stores, charging that their agreement to stand together against striking workers harms consumers by keeping prices artificially high.
“The grocers’ agreement to share costs and revenue hurts consumers by discouraging competitive pricing,” AG Bill Lockyer said in a statement.
The suit—filed in federal court in Los Angeles—argues that the Mutual Strike Assistance Agreement between Safeway, Albertsons and Kroger’s isn’t covered by the immunity that keeps management and unions from being sued for antitrust violations during a strike.
Albertsons and Ralphs locked out United Commercial & Food Workers members in October in solidarity with Safeway, and agreed not to cut prices while workers struck Safeway.
The AG argued that two factors make the agreement invalid. First, the agreement includes Kroger’s Food 4 Less division, which isn’t affected by the strike (although workers are locked out of Kroger’s Ralphs division, which is also part of the agreement). Secondly, the agreement is set to run for two weeks after the strike ends, allowing the grocers to collude to keep prices high even when the strike is over.
“The agreement extends beyond the time of the labor dispute, and it includes a supermarket which is not a party to the collective bargaining process, or a member of the multi-employer bargaining unit,” according to court documents.
The grocers agreed to the pact in August, two months before UCFW workers began their strike against Safeway, now in its fourth month. Meanwhile, UCFW has begun a $500,000 radio campaign urging Californians to honor picket lines and shop elsewhere.
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