{"id":2340059,"date":"2024-09-12T06:34:01","date_gmt":"2024-09-12T10:34:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/how-the-kroger-merger-could-further-erode-the-administrative-state-washington-examiner\/"},"modified":"2024-09-12T06:45:37","modified_gmt":"2024-09-12T10:45:37","slug":"how-the-kroger-merger-could-further-erode-the-administrative-state-washington-examiner","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/how-the-kroger-merger-could-further-erode-the-administrative-state-washington-examiner\/","title":{"rendered":"How the Kroger merger could further erode the administrative state &#8211; Washington Examiner"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">26<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fhow-the-kroger-merger-could-further-erode-the-administrative-state-washington-examiner%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2340059&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>The ongoing legal\u2062 challenge between Kroger and the \u200dFederal Trade Commission (FTC) centers on Kroger&#8217;s proposed \u2063$24.6 billion merger with Albertsons. The FTC has moved to block the merger, arguing that it could reduce competition, leading to higher prices, lower product quality, and store closures. In response, Kroger has filed a lawsuit claiming that the case should be heard in federal court\u200b rather than through the FTC&#8217;s in-house administrative process, which Kroger alleges lacks objectivity due to the judges being\u2064 seen as favorable to\u2064 the FTC.<\/p>\n<p>This lawsuit highlights \u200cwider concerns\u2062 about the regulatory power of federal agencies in overseeing corporate \u200bmergers. Kroger&#8217;s position echoes a recent Supreme Court \u2063ruling that limited the operations of the\u2064 Securities and Exchange Commission and suggested a growing trend against administrative regulatory powers. If Kroger&#8217;s challenge is successful, it could undermine the \u2062FTC&#8217;s authority and impact how regulatory agencies handle similar cases in the future.<\/p>\n<p>Currently, the merger is \u200dstalled due to ongoing litigation in multiple states, with Kroger&#8217;s lawsuit serving as a potential \u200dsafeguard if their merger is ultimately blocked. The debate over this merger is a microcosm of larger \u2063tensions between promoting a free\u2062 market and\u2062 ensuring consumer protections. The outcome is still unfolding, with differing strategies from Kroger and the FTC regarding the timeline of hearings and court processes.  <\/p>\n<p class=\"readmore\">\n    <button onclick=\"showReadMore()\" id=\"readmorebtn\">Read more&#8230;<\/button>\n<\/p>\n<hr id=\"line\">\n<span id=\"more\"><\/p>\n<p><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><\/p>\n<div class=\"tdb-block-inner td-fix-index\"><span class=\"tdb-mobile-menu-button\"><i class=\"tdb-mobile-menu-icon td-icon-mobile\"><\/i><\/span><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><span class=\"tdb-header-search-button-mob dropdown-toggle\" data-toggle=\"dropdown\"><i class=\"tdb-mobile-search-icon td-icon-search\"><\/i><\/span><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><span class=\"tdb-mobile-menu-button\"><i class=\"tdb-mobile-menu-icon td-icon-mobile\"><\/i><\/span><\/div>\n<div class=\"tdb-block-inner td-fix-index\">\n<div class=\"tdb-drop-down-search\" aria-labelledby=\"td-header-search-button\">\n<div class=\"tdb-drop-down-search-inner\">\n<form method=\"get\" class=\"tdb-search-form\" action=\"https:\/\/www.washingtonexaminer.com\/\"><\/form>\n<div class=\"tdb-aj-search\"><\/div>\n<\/div>\n<\/div>\n<p><a href=\"http:\/\/www.washingtonexaminer.com\/#\" role=\"button\" aria-label=\"Search\" class=\"tdb-head-search-btn dropdown-toggle\" data-toggle=\"dropdown\"><i class=\"tdb-search-icon td-icon-search\"><\/i><\/a><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<div class=\"tdb-block-inner td-fix-index\">\n<h1 class=\"tdb-title-text\">How the Kroger merger could further erode the administrative state<\/h1>\n<div><\/div>\n<div class=\"tdb-title-line\"><\/div>\n<\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<div class=\"tdb-block-inner td-fix-index\">\n<div id=\"Brid_1755234\" class=\"tpd-featured-video bridtv\"><\/div>\n<p><em>The Federal Trade Commission is challenging Kroger&rsquo;s acquisition of Albertsons, saying their merger would be anticompetitive. The <\/em>Washington Examiner<em> will take a deeper look at what this lawsuit and potential merger would do to food prices &ndash; particularly on the cusp of the November election. Part 2 of <\/em><strong><em>Supermarket Sweep Up<\/em><\/strong><em>  will focus on how this case plays into the larger argument about the power of federal agencies.<\/em><\/p>\n<div class=\"article-paywall\">\n<p>The merger between <a href=\"https:\/\/www.washingtonexaminer.com\/news\/business\/3076515\/kroger-safeway-parent-company-to-close-stores\/\" target=\"_blank\" rel=\"noopener\" title>Kroger and Albertsons<\/a> could ultimately lead to another chip against the armor of the administrative state if the <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/ftc\/\" target=\"_blank\" rel=\"noopener\" title>Federal Trade Commission<\/a> succeeds at contesting the plan.<\/p>\n<p>Earlier this year, the FTC sued to block the $24.6 billion merger, arguing it would create less competition between brands and would lead to reduced product quality, more store closures, and higher prices. Kroger, which argues the merger would actually reduce grocery costs, sued the FTC in <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/Ohio\/\" target=\"_blank\" rel=\"noopener\" title>Ohio<\/a> federal court in response, arguing the agency&rsquo;s in-house adjudication process violates the constitutional separation of powers.<\/p>\n<figure class=\"wp-block-image size-full\"><figcaption class=\"wp-element-caption\">Faye Guenther, president of local UFCW 3000, holds a sign during a news conference about the Kroger and Albertsons merger outside the federal courthouse on Monday, Aug. 26, 2024, in Portland, Ore. (AP Photo\/Jenny Kane)<\/figcaption><\/figure>\n<p>Here is what to know about how one grocery merger fight could further derail the administrative state.<\/p>\n<h2 class=\"wp-block-heading\">What is Kroger&rsquo;s lawsuit even about?<\/h2>\n<p>Kroger contends that the merger should be adjudicated in federal court, rather than handled by in-house Administrative Law Judges (ALJs), which often are criticized for favoring the legal positions of the agency.<\/p>\n<p>If the grocery store chain&rsquo;s argument sounds familiar, it is because the Supreme Court recently ruled on a similar matter against the Securities and Exchange Commission earlier this year in the case known as <em><a href=\"https:\/\/www.washingtonexaminer.com\/news\/supreme-court\/3042116\/supreme-court-rules-to-limit-powers-of-sec\/\" target=\"_blank\" rel=\"noopener\" title=\"SEC v. Jarkesy\">SEC v. Jarkesy<\/a><\/em>, which held that the Seventh Amendment entitles a defendant in a <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/ftc-asks-judge-to-hold-martin-shkreli-in-contempt-for-forming-new-drug-company\/\" title=\"FTC Asks Judge to Hold Martin Shkreli in Contempt for Forming New Drug Company\">securities fraud case<\/a> to a jury trial, effectively curbing the SEC&rsquo;s ability to force disputes before in-agency judges.<\/p>\n<p>&ldquo;I&rsquo;m not surprised about this at all,&rdquo; Case Western Reserve University School of Law professor Anat Alon-Beck told the <em>Washington Examiner<\/em> of Kroger&rsquo;s challenge, noting the <em>Jarkesy <\/em>case &ldquo;takes a lot of power from the regulators and the administrative state,&rdquo; and comes at a time when more and more pro-business litigants are taking a sharper aim against regulations.<\/p>\n<p>Specifically, Kroger also claims the in-house judges presiding over such cases are not removable by the president, thus violating the separation of powers as established in <em>Free Enterprise Fund v. Public Company Accounting Oversight Board<\/em> (2010).<\/p>\n<p>For proponents of heightened regulations on corporations engaging in <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/six-politicians-speaking-out-against-amazon-mgm-deal\/\" title=\"Six Politicians Speaking Out Against Amazon-MGM Deal\">multi-billion dollar deals<\/a>, allowing such mergers to be decided by in-agency experts is encouraged because it is seen as protecting ordinary consumers and employees. <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/unions\/\" target=\"_blank\" rel=\"noopener\" title>Labor union leaders<\/a>, for example, say that workers&rsquo; wages and benefits would decline if Kroger and Albertsons could no longer compete.<\/p>\n<p>Conversely, those in favor of more free market approaches could see the status quo of the FTC in-house adjudications to be too restrictive against large business decisions that claim to be beneficial for consumers.<\/p>\n<h2 class=\"wp-block-heading\">What would a victory for Kroger mean for FTC oversight?<\/h2>\n<p>If Kroger succeeded in its challenge against the in-house adjudications at the FTC, it would mark another toppled pillar in a trend against executive agency regulatory powers. Earlier this year, the <a href=\"https:\/\/www.washingtonexaminer.com\/news\/supreme-court\/3045084\/supreme-court-shreds-chevron-doctrine-in-blow-to-agency-powers\/\" target=\"_blank\" rel=\"noopener\" title>Supreme Court overturned the 1984 <em>Chevron <\/em>doctrine<\/a>, which enhanced the burden on administrative agencies to set regulations and policies by proving that such rules have a basis in legislation passed by Congress.<\/p>\n<p>But the Kroger-Albertsons challenges are currently not just taking place at the FTC&rsquo;s ongoing administrative trial. There are also separate lawsuits stemming from <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/Oregon\" target=\"_blank\" rel=\"noopener\" title>Oregon<\/a>, two state lawsuits in Colorado, and one in Washington state. The merger is currently on hold until the Colorado case is resolved.<\/p>\n<p>In some ways, Kroger&rsquo;s lawsuit against the FTC acts as a failsafe to protect its merger plans in the event that the merger ultimately is struck down by the agency. <\/p>\n<p>In other words, if the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/kroger-closing-more-stores-due-to-seattles-mandated-hazard-pay-for-workers\/\" title=\"Kroger Closing More Stores Due To Seattle\u2019s Mandated \u2018Hazard Pay\u2019 For Workers\">grocery chain<\/a> does not get its way, then the chain&rsquo;s constitutional challenge in Ohio federal court serves as a backup that could take a legal sledgehammer to the regulatory power house.<\/p>\n<p>&ldquo;You&rsquo;re damned if you do, and damned if you don&rsquo;t,&rdquo; Alon-Beck said, adding &ldquo;I think the agencies now, all of them will have to decide how they&rsquo;re dealing with this, because they&rsquo;re going to be dragged to court as a result.&rdquo;<\/p>\n<p>Alon-Beck said the upshot of more rulings against agency procedures could mean that they will need to &ldquo;revamp their guidelines on antitrust.&rdquo;<\/p>\n<p>&ldquo;In some cases, it might not be worth it for them to bring forward [these challenges] because they don&rsquo;t want their wings to be cut like they did the SEC.&rdquo;<\/p>\n<h2 class=\"wp-block-heading\">What does the next chapter look like for Kroger v. FTC?<\/h2>\n<p>The next phase of this fight between grocery chains and federal regulators is currently in flux, but the government is pushing for a resolution over the merger before wading into the <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/lawsuit\/\" target=\"_blank\" rel=\"noopener\" title>lawsuit<\/a> against the fundamental functionality of the FTC. This would be strategic, as it could save higher courts from digging into the chewier constitutional issues that threaten the powers of the agency.<\/p>\n<p>It&rsquo;s a &ldquo;push-pull right now in the current dispute,&rdquo; Michael Murray, a partner and co-chair of the antitrust and competition practice at Paul Hastings, told the <em>Washington Examiner<\/em>.<\/p>\n<p>Kroger is asking the federal court in Ohio to begin holding hearings in the case as early as Oct. 4, while the FTC, represented by President <a href=\"https:\/\/www.washingtonexaminer.com\/tag\/joe-biden\/\" target=\"_blank\" rel=\"noopener\" title>Joe Biden<\/a>&lsquo;s Justice Department, argues that the Ohio case should only get underway after the merger trial is ruled upon.<\/p>\n<p>&ldquo;So the FTC wants to go with the merger review trial out in Oregon, and Kroger wants to deal with the constitutionality issue earlier,&rdquo; Murray said, adding while things can certainly change, the &ldquo;most likely outcome&rdquo; is that the merger trial would be heard before Kroger&rsquo;s constitutional challenge to the agency&rsquo;s in-house adjudications.<\/p>\n<h2 class=\"wp-block-heading\">Did <em>Jarkesy <\/em>really signal a death knell for in-agency adjudications?<\/h2>\n<p>Additionally, Murray offered some semblance of optimism to regulators who may feel that the&nbsp;<em>Jarkesy&nbsp;<\/em>case spelled the beginning of the end for in-house adjudications, noting that the case did not completely rule out the use of ALJs.<\/p>\n<p>&ldquo;I don&rsquo;t think it should be over-read to suggest that there&rsquo;s no role for ALJs or similarly situated officials in administrative agencies,&rdquo; said Murray.<\/p>\n<p><strong><a href=\"https:\/\/www.washingtonexaminer.com\/\" target=\"_blank\" rel=\"noopener\" title> <\/a><\/strong><\/p>\n<p>While noting the Supreme Court certainly could have gone that direction, Murray noted that the <em>Jarkesy <\/em>case &ldquo;needs to be read with that kind of nuance.&rdquo;<\/p>\n<p>Although <em>Jarkesy <\/em>shows the courts are skeptical of delegating significant duties in certain claims, it did not rule out ALJs from performing functions that are fundamentally critical to the functioning administrative agencies, according to Murray.<\/p>\n<\/div>\n<p> <script data-cfasync=\"false\" src=\"http:\/\/www.washingtonexaminer.com\/cdn-cgi\/scripts\/5c5dd728\/cloudflare-static\/email-decode.min.js\"><\/script><script>!function(){var g=window;g.googletag=g.googletag||{},g.googletag.cmd=g.googletag.cmd||[],g.googletag.cmd.push(function(){g.googletag.pubads().setTargeting(\"has-featured-video\",\"true\")})}();<\/script><script>var _bp=_bp||[];_bp.push({\"div\":\"Brid_1755234\",\"obj\":{\"id\":\"27789\",\"width\":\"1280\",\"height\":\"720\",\"stickyDirection\":\"below\",\"video\":\"1755234\"}});<\/script><script defer src=\"https:\/\/services.brid.tv\/player\/build\/brid.min.js\"><\/script><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<div class=\"tdb-block-inner td-fix-index\"><\/div>\n<p><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Federal Trade Commission (FTC) is contesting Kroger&#8217;s purchase of Albertsons, claiming that the merger would reduce competition. The Washington Examiner plans to explore the implications of this lawsuit and merger on food prices, especially with the upcoming November election in mind. Part 2 of Supermarket Sweep Up will examine how this case fits into broader discussions about federal agency authority. If the FTC successfully blocks the $24.6 billion merger, it could weaken the administrative state further.<\/p>\n<p>Kroger argues that its merger with Albertsons would actually lower grocery prices and has filed a lawsuit against the FTC in Ohio federal court, asserting that cases like theirs should be decided in federal court rather than by internal Administrative Law Judges (ALJs), who are often seen as biased towards agency positions. This argument echoes a recent Supreme Court ruling in SEC v. Jarkesy, which affirmed a defendant&#8217;s right to a jury trial in securities fraud cases and limited the SEC\u2019s ability to use internal judges.<\/p>\n<p>Case Western Reserve University law professor Anat Alon-Beck noted that Kroger\u2019s challenge reflects a growing trend among pro-business litigants targeting regulatory powers. Kroger also claims that ALJs cannot be removed by the president, violating constitutional separation of powers principles established in Free Enterprise Fund v. Public Company Accounting Oversight Board (2010). Supporters of stricter corporate regulations argue for keeping such mergers under agency oversight to protect consumers and workers&#8217; interests.<\/p>\n<p>If Kroger wins its case against FTC adjudications, it could signify another blow to executive regulatory authority following earlier Supreme Court decisions limiting agencies&#8217; power to enforce regulations without clear legislative backing. Currently, there are multiple lawsuits related to this merger across various states; however, proceedings are paused until one Colorado case is resolved.<\/p>\n<p>Kroger&#8217;s legal strategy serves as a safeguard for its merger plans while challenging regulatory authority\u2014if they lose on one front, their constitutional challenge may still undermine agency power significantly.<\/p>\n<p>The ongoing dispute between Kroger and federal regulators remains uncertain as both sides push for different timelines regarding hearings on their respective cases\u2014Kroger wants an expedited hearing on constitutional issues while the FTC prefers resolving merger reviews first.<\/p>\n<p>While some believe recent rulings signal an end for internal adjudications within agencies like the FTC or SEC, experts suggest these rulings do not entirely eliminate ALJs from playing essential roles within administrative processes but rather call for careful consideration of their functions moving forward<\/p>\n","protected":false},"author":2633,"featured_media":2340060,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/www.washingtonexaminer.com\/wp-content\/uploads\/2024\/09\/Kroger-Albertsons-Merger_kk2.webp","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[33120,15398,16353,32076],"class_list":["post-2340059","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-administrative-state","tag-kroger","tag-merger","tag-washington-examiner"],"fifu_image_url":"https:\/\/www.washingtonexaminer.com\/wp-content\/uploads\/2024\/09\/Kroger-Albertsons-Merger_kk2.webp","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2340059","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/2633"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2340059"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2340059\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2340060"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2340059"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2340059"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2340059"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}