Kroger Files Motion to Enjoin the FTC's Administrative Merger Challenge
Kroger has filed a motion for preliminary injunction against the Federal Trade Commission's (FTC) administrative proceeding challenging its merger with Albertson's. The company argues that the FTC's actions violate Constitutional protections in two key areas:
1. The Administrative Law Judge's lack of removability by the President violates Article II.
2. Adjudicating private rights through the Executive Branch rather than the Judicial Branch violates Article III.
Kroger contends that the FTC is inappropriately seeking multiple opportunities to litigate the same issues by splitting its challenge into two separate tribunals. The company remains prepared to defend the merger in the upcoming federal court trial, set to begin on August 26 in the District of Oregon.
Kroger ha presentato una mozione per un'ingiunzione preliminare contro il procedimento amministrativo della Federal Trade Commission (FTC) che sfida la sua fusione con Albertson's. L'azienda sostiene che le azioni della FTC violano le protezioni costituzionali in due aree chiave:
1. La mancanza di rimovibilità del Giudice Amministrativo da parte del Presidente viola l'Articolo II.
2. L'adjudicazione dei diritti privati attraverso il ramo esecutivo anziché il ramo judiziale viola l'Articolo III.
Kroger afferma che la FTC sta cercando in modo inappropriato diverse opportunità per litigare sugli stessi problemi dividendone la sfida in due tribunali separati. L'azienda rimane pronta a difendere la fusione nel prossimo processo giudiziario federale, che inizierà il 26 agosto nel Distretto dell'Oregon.
Kroger ha presentado una moción para una injunction preliminar contra el procedimiento administrativo de la Federal Trade Commission (FTC) que cuestiona su fusión con Albertson's. La empresa argumenta que las acciones de la FTC violan las protecciones constitucionales en dos áreas clave:
1. La falta de destitución del Juez de Derecho Administrativo por parte del Presidente viola el Artículo II.
2. Deliberar sobre derechos privados a través del Poder Ejecutivo en lugar del Poder Judicial viola el Artículo III.
Kroger sostiene que la FTC busca inapropiadamente múltiples oportunidades para litigar los mismos temas dividiendo su desafío en dos tribunales separados. La empresa está lista para defender la fusión en el próximo juicio federal, que comenzará el 26 de agosto en el Distrito de Oregón.
Kroger는 Federal Trade Commission (FTC)의 행정 절차에 대해 Albertson's와의 합병을 반대하는 가처분 신청을 제기했습니다. 회사는 FTC의 행동이 두 가지 주요 분야에서 헌법적 보호를 위반한다고 주장합니다:
1. 행정법 판사의 대통령에 의한 해임 불가능은 제2조를 위반합니다.
2. 사적인 권리를 사법부가 아닌 행정부를 통해 판결하는 것은 제3조를 위반합니다.
Kroger는 FTC가 같은 문제에 대해 두 개의 별도 재판소로 나누어 소송할 수 있는 여러 기회를 부적절하게 모색하고 있다고 주장합니다. 회사는 오는 8월 26일 오리건 지구에서 시작되는 연방 법원 재판에서 합병을 방어할 준비가 되어 있습니다.
Kroger a déposé une requête en injonction préliminaire contre la procédure administrative de la Federal Trade Commission (FTC) qui conteste sa fusion avec Albertson's. L'entreprise soutient que les actions de la FTC violent les protections constitutionnelles dans deux domaines clés :
1. Le manque de révocabilité du juge administratif par le Président viole l'Article II.
2. Le jugement des droits privés par l'exécutif plutôt que par le judiciaire viole l'Article III.
Kroger estime que la FTC cherche de manière inappropriée à multiplier les occasions de plaider les mêmes questions en scindant son défi en deux tribunaux distincts. L'entreprise est prête à défendre la fusion lors du prochain procès fédéral, qui doit commencer le 26 août dans le district de l'Oregon.
Kroger hat einen Antrag auf einstweilige Verfügung gegen das Verwaltungsverfahren der Federal Trade Commission (FTC) eingereicht, das die Fusion mit Albertson's in Frage stellt. Das Unternehmen argumentiert, dass die Handlungen der FTC die verfassungsmäßigen Schutzrechte in zwei zentralen Bereichen verletzen:
1. Die Unentfernbarkeit des Verwaltungsrichters durch den Präsidenten verstößt gegen Artikel II.
2. Die Entscheidung über private Rechte durch die Exekutive anstelle der Judikative verstößt gegen Artikel III.
Kroger behauptet, dass die FTC unangemessen mehrere Möglichkeiten sucht, um die gleichen Themen zu klären, indem sie ihre Herausforderung in zwei separate Gerichte aufteilt. Das Unternehmen ist bereit, die Fusion im bevorstehenden Bundesgerichtsverfahren, das am 26. August im Bezirk Oregon beginnen soll, zu verteidigen.
- Kroger is actively defending its merger with Albertsons, demonstrating confidence in the deal's legality
- The company argues that the merger will bring lower prices to customers and secure union jobs
- Kroger is challenging the FTC's process, potentially streamlining future merger proceedings if successful
- The FTC's challenge to the merger in multiple venues could prolong the approval process
- Legal battles with the FTC may incur significant costs for Kroger
- Uncertainty surrounding the merger's approval could impact Kroger's stock performance
Insights
This legal challenge by Kroger against the FTC's administrative proceedings is a significant development in the ongoing merger saga with Albertsons. The company's argument hinges on two key constitutional points:
- Violation of Article II: The inability to remove the Administrative Law Judge by the President
- Violation of Article III: The FTC's attempt to adjudicate private rights through the Executive Branch instead of the Judicial Branch
These arguments are bolstered by recent Supreme Court decisions, particularly SEC v. Jarkesy (2024), which strengthens Kroger's position. If successful, this motion could significantly alter the FTC's merger review process, potentially streamlining future corporate mergers. However, it's important to note that this doesn't guarantee the merger's approval; it merely challenges the procedural aspects of the FTC's review.
Kroger's legal maneuver demonstrates a proactive approach to expediting the merger process, which could be viewed positively by investors. However, the prolonged legal battle and potential delays in merger completion pose risks. Key financial considerations include:
- Merger synergies: The
$500 million in annual cost savings projected from the merger are now delayed - Legal costs: Extended litigation will increase expenses, potentially impacting short-term profitability
- Market uncertainty: Prolonged legal proceedings may lead to stock price volatility
While Kroger's commitment to "lower prices" and "good-paying union jobs" aims to address regulatory concerns, the financial benefits of the merger remain uncertain until legal hurdles are cleared. Investors should closely monitor the August 26 federal court proceedings for further clarity on the merger's prospects.
FTC's in-house tribunal violates Constitutional protections against federal government overreach
Company remains prepared to defend merger with Albertsons in upcoming federal court trial
The motion details how the FTC's administrative proceeding against the merger clearly violates the Constitution in two areas:
- First, the FTC violates Article II of the Constitution because the Administrative Law Judge presiding over the administrative proceeding is not removable by the President of
the United States . This principle was recognized and applied by the Supreme Court in Free Enterprise Fund v. Public Company Accounting Oversight Board (2010). - Second, the FTC violates Article III of the Constitution by seeking to adjudicate Kroger's private rights to contract with another private party administratively through the Executive Branch rather than in the independent Judicial Branch. This standard was reinforced this past term by the Supreme Court in SEC v. Jarkesy (2024).
Furthermore, the FTC has sought to split its challenge to the merger into two separate tribunals in an inappropriate attempt to receive multiple opportunities to litigate the same issues. Despite forcing Kroger to participate in this unconstitutional administrative proceeding, the FTC has also filed a motion in the federal court proceedings seeking to block the merger for the duration of its administrative proceeding – which will likely take several years to resolve. Evidentiary hearings for the federal court proceeding are set to being on August 26 in the District of
"The merger between Kroger and Albertson's is squarely focused on ensuring we bring customers lower prices starting day one while securing the future of good-paying union jobs," said Rodney McMullen, Kroger Chairman and CEO. "We stand prepared to defend this merger in the upcoming trial in federal court – the appropriate venue for this matter to be heard – and we are asking the Court to halt what amounts to an unlawful proceeding before the FTC's own in-house tribunal."
About Kroger
At The Kroger Co. (NYSE:KR), we are dedicated to our Purpose: to Feed the Human Spirit™. We are, across our family of companies nearly 420,000 associates who serve over eleven million customers daily through a seamless digital shopping experience and retail food stores under a variety of banner names, serving America through food inspiration and uplift, and creating #ZeroHungerZeroWaste communities.
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SOURCE The Kroger Co.
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