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In Oregon, Willamette Week reports that Whole Foods is using its ongoing battle with the Federal Trade Commission (FTC) as a way to try to gather information about a local competitor, nine-store New Seasons Markets.

As has been reported, the FTC is attempting to unravel the acquisition of Wild Oats by Whole Foods, despite the fact that the $565 million deal closed more than a year ago. The FTC charges that the deal violates antitrust laws, and is pursuing the matter in the courts even though virtually every Wild Oats store has been converted to the Whole Foods banner.

According to the story, New Seasons CEO Brian Rohter has written in his blog that “you … are probably trying to figure out what this could possibly have to do with us. That’s a great question. Since we’ve been minding our own (local) business and have never expressed an opinion one way or the other about this merger, we were wondering the same thing.

“As it turns out, because of their legal dispute with the FTC, Whole Foods has an opportunity to try and force us to give them copies of some of our most confidential financial records – for instance what our sales are, week by week, at each of our stores. They’ve also demanded all of our files that detail our strategic plans, all of our marketing plans and all of our studies about where we are considering opening new stores … I have to believe that any reasonable person would agree that it’s really over the top for Whole Foods to be asking for this information, especially since we have nothing to do with their lawsuit. It takes away the level playing field, creates an unnecessary risk for our business and has the potential to have a negative impact on our network of local , ranchers and suppliers. It also could permanently damage the fragile regional food system that we’ve been working to create and, in the end, could reduce options for Portlanders who choose to shop at locally owned stores.”

Willamette Week, which post copies of the legal documents served by Whole Foods’ attorneys, notes that New Seasons is fighting the motions at considerable cost.

And Rohter writes in his blog that “We’ve been able to build a successful local business being David against their Goliath, and we’re happy to keep doing that, but we do object to having one hand tied behind our back. Whole Foods says that we should give our information to their lawyers and they claim the lawyers won’t let anyone else in the organization see them. That’s like trusting the fox to guard the henhouse – and we don’t have any faith it’s going to work like that.”

KC's View:
Being an independent businessman myself, I feel strongly that Rohter and New Seasons are absolutely right on this one. I wouldn’t give Whole Foods a damn thing…and I’d do my level best in both the courts and the court of public opinion to fight them. And I might consider throwing all my computers and paper files in the Willamette River to protest what is clearly an unfair attack on my ability to compete.

It never occurred to me that Whole Foods might be able to use the FTC imitation of a rabid dog to its own advantage. But if it is doing this with New Seasons, doesn’t it seem likely that it is happening elsewhere, to other small retailers?

It seems as if the FTC is subverting justice on a variety of levels.