Albertsons, Haggen Reach Settlement


Albertsons has agreed to pay defunct grocery company Haggen a $5.75 million cash settlement in response to the $1 billion the Pacific Northwest grocer was seeking as a result of a lawsuit filed in September of last year.

The settlement – which constitutes less than 1 percent of what Bellingham, Wash.-based Haggen was seeking – was reached on Jan. 22, according to a document filed with the Securities and Exchange Commission on Friday. The $5.75 million will go to Haggen's creditors.

The suit claimed that following Haggen's acquisition of 146 stores divested from the Albertsons-Safeway merger in December 2014 – which expanded Haggen's footprint from 18 to 164 stores essentially overnight -- Albertsons was guilty of "coordinated and systematic efforts to eliminate competition and Haggen as a viable competitor in over 130 local grocery markets in five states,” and “made false representations to both Haggen and the FTC about Albertsons’ commitment to a seamless transformation of the stores into viable competitors under the Haggen banner.”

Haggen alleged that Albertsons provided inaccurate pricing data, resulting in Haggen's inflating prices, which created yet another rift in its expansion plans and in part led to the grocer's filing for bankruptcy on Sept. 9. At the time, Albertsons vehemently denied responsibility, and in fact had filed a lawsuit during the prior July citing breach of contract and alleging that Haggen had refused to pay almost $40 million for inventory following the acquisition.

Following its bankruptcy filing, Haggen began to incrementally divest its stores, exiting the Pacific Southwest in late September in an effort to focus more narrowly on its profitable locations. The company announced plans to sell its remaining stores on Nov. 10, the auction for which is slated for Feb. 5.

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