Lawyers in Washington state are gearing up to challenge the proposed merger between grocery giants Albertsons and Kroger, citing the negative impact of previous grocery chain mergers. The $24.6 billion deal, announced nearly two years ago, is being contested in three separate cases, with the Federal Trade Commission currently battling the merger in federal court in Oregon, where closing arguments are expected Tuesday. Colorado has also filed a lawsuit to block the merger.

If the merger were to proceed, Washington state residents would be most affected compared to other states as Albertsons and Kroger collectively own over 300 grocery stores there, accounting for more than half of the state's grocery sales. In an attempt to alleviate regulators' concerns, Kroger and Albertsons have proposed selling 579 overlapping stores, including 124 in Washington. This is the highest number among the 19 states where stores are involved in the sale. However, Washington's Attorney General's office has expressed apprehension about the proposed buyer, C&S Wholesale Grocers, stating that it lacks experience in running stores or pharmacies.

The state of Washington is seeking to avoid a situation similar to the one it faced a decade ago when Albertsons purchased the Safeway chain. In order to satisfy regulators' concerns about competition and consumer impact, Albertsons sold 146 stores to the smaller grocery chain, Haggen, which was based in Bellingham, Washington. However, Haggen struggled with the expansion, ultimately closing 127 stores, including 14 in Washington, and resulting in thousands of job losses. The remaining Haggen stores were subsequently sold back to Albertsons in 2016. Unfortunately, if the merger between Albertsons and Kroger were to proceed, 10 Haggen stores in Washington would once again be on the list of stores to be sold.

Concerns are mounting in Washington state, with Tina McKim, a founding member of the Birchwood Food Desert Fighters group, voicing her worries. McKim recalls the closure of an Albertsons store in Bellingham's Birchwood neighborhood in 2016, which left the community without easy access to fresh food. As a result, McKim's group has been working to fill this void by collecting food donations and sourcing produce from local farms, but their efforts are unable to fully meet the community's needs. McKim expresses skepticism about the merger's potential benefits and argues that other successful grocery stores have thrived by catering to the specific needs of their respective neighborhoods.

Washington Attorney General Bob Ferguson, a Democrat who is also running for governor, is seeking to block the merger not only within the state but nationwide. The state's complaint, filed in Seattle's King County Superior Court, argues that eliminating the competition between Albertsons and Kroger would likely lead to higher prices, lower quality, and probable store closures. However, Albertsons and Kroger have requested the dismissal of the case, contending that a state court is not the appropriate venue for a nationwide ban, citing Washington's inability to wield its antitrust law decision-making power over the rest of the country.

Brad Weber, an antitrust specialist with the law firm Locke Lord, suggests that the judge presiding over the case could potentially halt the merger nationwide or limit their ruling to Washington. The judge might also require the companies to make adjustments to their divestment plans in order to preserve competition. Pending a ruling from the U.S. District Court in Oregon, Ferguson could potentially decide to delay the case. The Federal Trade Commission has also requested a temporary block on the merger until it is considered by an in-house judge.

Albertsons and Kroger argue that their merger plan, including the sale of stores to C&S, would result in lower grocery prices and competition preservation in the face of growing rivals such as Walmart and Costco. However, Washington residents like Tina McKim remain skeptical about these claims. The closure of the Albertsons store in Birchwood, which left the neighborhood deprived of food access, has fueled concerns regarding the potential consequences of the merger.

In a recent development, Albertsons removed a restriction on the Birchwood shopping plaza, where the former Albertsons store was located, following an investigation by Washington's attorney general. However, McKim expresses concern that even if another supermarket were to occupy the space, the community may never fully recover the unionized jobs that were lost when Albertsons closed its doors.

As the legal battle continues, the fate of the proposed merger hangs in the balance, with both sides presenting their arguments before the courts. Washington state lawyers are determined to prevent a repeat of past consequences and safeguard the interests of consumers and competition in the grocery industry.