Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Supermarket chain allegedly obstructed competition for full-service supermarkets, (Apr 1, 2016)

By Linda O’Brien, J.D., LL.M.

A supermarket chain and a real estate developer engaged in anticompetitive conduct by agreeing to obstruct a competing supermarket’s attempts to obtain land use approvals to develop property with a full-service supermarket that would compete with the supermarket chain in Bergen County, New Jersey, according to a complaint filed in the federal district court in Newark, New Jersey (Inserra Supermarkets, Inc. v. The Stop & Shop Supermarket Company, Inc., March 28, 2016).

The Stop & Shop Supermarket Company is a chain of supermarkets located in the northeastern United States. Real estate developer Munico Associates, L.P. operates a shopping center located in Wyckoff, New Jersey and owns other properties in New Jersey, in which Stop & Shop operates full-service supermarkets.

The complaint states that, in May 2009, Inserra Supermarkets entered into a lease for property in Wyckoff, New Jersey for the purpose of developing and operating a full-service retail grocery store. The property was previously developed with two buildings—one building that was previously used by Stop & Shop as a supermarket and a second building containing a variety of retail uses. The property is adjacent to the shopping center that Stop & Shop is located. Stop & Shop’s existing Wyckoff store in the only full-service supermarket currently operating in Wyckoff, New Jersey.

Inserra filed an application for preliminary and final site plan approval for the property with the Wyckoff Planning Board in September 2009. Inserra sought to develop a Shop Rite full-service supermarket and requested certain bulk variances from the Wyckoff Zoning Ordinance. Inserra alleges that Stop & Shop and Munico began a scheme to improperly delay the proceedings before a number of government agencies.

According to the complaint, Stop & Shop and Munico coordinated their efforts to oppose Inserra’s application and delay all necessary government approvals by raising objections before the Wyckoff Planning Board; circulating postcards and flyers to local residents to incite public objections to the application; filing complaints and petitions with the Bergen County Planning Board and state court; and appealing each and every adverse decision experienced by them.

By intentionally delaying and seeking to prevent the development of a competing Shop Rite store in Wyckoff, the defendants prevented the entry of a competitor into the market for full-service grocery stores, Inserra claims. Consumers in Bergen County allegedly have been injured by the absence of competition in full-service grocery stores through higher prices than would have otherwise been available.

The plaintiff asserts claims for tortious interference with contract, interference with prospective economic advantage, civil conspiracy, and conspiracy to restrain trade and monopolization in violation of Sections 1 and 2 of the Sherman Act and the New Jersey Antitrust Act. The action seeks declaratory and injunctive relief, damages, costs of suit, attorney fees, and any other just and proper relief.

The case is No. 2:16-cv-01697-WJM-MF.

Attorneys: Arthur N. Chagaris and John J. Lamb (Beattie Padovano, LLC) for Inserra Supermarkets, Inc.

Companies: Inserra Supermarkets, Inc.; The Stop & Shop Supermarket Company, Inc.; Munico Associates, L.P.; Wyckoff Residential, LLC

News: Antitrust NewJerseyNews