Supervalu, C&S Target of Antitrust Lawsuit

Supervalu and C&S Wholesale Grocers, Inc. have been hit by a suit claiming that the distributors plotted “to allocate markets, customers and territories,” which resulted in price-fixing in New England and part of the Midwest, the plaintiff, single-store Boston grocer DeLuca’s Corp. said in its class action.

The antitrust lawsuit alleges that the distributors once vied for customers in New England, but shortly after Keene, N.H.-based C&S bought operations once run by defunct wholesaler Fleming Cos., Inc. in 2003, C&S and Minneapolis-based Supervalu agreed that Supervalu would pull out of New England if C&S wouldn’t enter the Midwest, according to a report in the Keene Sentinel.

C&S purchased Supervalu’s New England operations, including facilities in Portland, Maine; Andover, Mass.; and Cranston, R.I., while Supervalu acquired C&S’s Wisconsin DCs.

The lawsuit claims that the transaction led to raised prices and a subsequent lack of competition in the six New England states as well as in Illinois, Indiana, Iowa, Michigan, Minnesota, Ohio and Wisconsin. Rather than an “asset swap,” as the companies referred to it, the filing maintains that C&S closed the distribution facilities in the Midwest that had been bought from Fleming and shut those in New England that it purchased from Supervalu.

The lawsuit seeks three times the amount of any damages from the alleged uncompetitive pricing. The amount of damages has not yet been determined. Two other similar antitrust lawsuits have been filed recently against C&S and Supervalu. One suit, filed by D&G, Inc., which runs a grocery store in Mount Vernon, Iowa, and is serviced by Supervalu, is still active.

C&S and Supervalu have both declined comment on the pending litigation.
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