July 7, 2010, Minneapolis, MN – The U.S. District Court for the District of Minnesota issued a ruling today denying Defendant C&S Wholesale Grocers and Defendant Supervalu, Inc.’s motion to dismiss claims brought by a proposed class of retail grocery stores that purchased grocery products from Defendants.

Plaintiffs allege that the Defendants entered into an unlawful customer and market allocation conspiracy in connection with an asset swap agreement. In its ruling, the Court found that Plaintiffs have alleged plausible grounds for relief under the antitrust laws, stating that, “if Plaintiffs’ allegations are true, it was Defendants’ conspiracy, which included the exiting of the New England and Midwest markets, that erected barriers preventing C&S from entering the Midwest and SuperValu from re-entering New England.” The Court rejected Defendants’ statute of limitations defense, finding that Plaintiffs had alleged a continuing violation.

The Court also denied summary judgment on the issue of whether Defendants’ agreement was a per se antitrust violation, and on the issue of whether the rule of reason should apply.

The lawsuit was originally filed by Kotchen & Low LLP in federal court in Wisconsin in December 2008 before being transferred and consolidated. Discovery is expected to commence shortly.

Related media coverage: C&S, SuperValu Lose Bid to Toss Antitrust Suit, CompLaw360 (July 8, 2010).