Austin, Texas In an unexpected and unusual move, the U.S. government is once again challenging Whole Foods Marketâ€™s purchase of rival Wild Oats.
Even though the deal closed early last yearâ€”and Whole Foods has since sold 35 Wild Oats stores and closed 12â€”the Federal Trade Commission (FTC) is trying again to stop Austin, Texas-based Whole Foods' takeover of Wild Oats.
The U.S. government announced it will ask an appeals court Wednesday to stop the takeover.
The FTC tried to block Whole Foods' acquisition of Boulder, Colo.-based Wild Oats after the transaction was announced last February, arguing that it would stifle competition and harm consumers. But a federal judge rejected the request, and Whole Foods and Wild Oats closed the deal in August 2007.
Instead of following the typical path and discontinuing the fight, the FTC isnâ€™t letting go, arguing that the companies haven't finished combining their operations and Whole Foods hasn't closed all the Wild Oats stores it plans to close. The FTC said it still has time to order the combined company to sell stores or other assets to protect competition.
The FTC would have to begin additional legal proceedings to take such a step.
The government agency asked the same appeals court last August to delay the closing of Whole Foods' acquisition pending the outcome of its appeal, but the court refused. Antitrust experts have said that makes it less likely the court will rule in the agency's favor now.
The FTC said in court papers that the district court applied an improper legal standard when it denied the agency's request to bar the acquisition.
The FTC and lawyers representing Whole Foods are arguing the case before a three-judge panel at the U.S. Court of Appeals for the D.C. Circuit Wednesday at 9:30 a.m. EDT.