Appeals Court Allows Grocery Suit to Proceed

A U.S. appeals court ruled Wednesday that a financial mutual-aid pact among the three grocery chains involved in the Southern and Central California labor dispute last year could be challenged on antitrust grounds, a spokesman for state Atty. Gen. Bill Lockyer said.

Lockyer filed a lawsuit alleging that the agreement -- under which the chains shared nearly $150 million to help one another during the strike and lockout -- violated U.S. antitrust laws.

The chains sought to have the suit dismissed, contending that the arrangement was legal and protected by labor laws. But U.S. District Judge George H. King ruled in May that the suit could proceed, and his decision was upheld Wednesday by the U.S. 9th Circuit Court of Appeals, Lockyer spokesman Tom Dresslar said.

The dispute, which affected 59,000 workers at 852 supermarkets, lasted 4 1/2 months before ending on Feb. 29, 2004.

The chains are Safeway Inc., which owns Vons and Pavilions; Kroger Co., the parent of Ralphs; and Albertsons Inc. The companies couldn’t be reached for comment late Wednesday.

The court rulings have not decided whether the grocers actually restrained competition or otherwise broke antitrust laws. But the rulings move the lawsuit closer to a trial that would weigh the merits of Lockyer’s allegations.

The mutual-aid pact, reached weeks before the dispute began, was meant to ensure that no chain could profit at the expense of another during the fight with the United Food and Commercial Workers union.