New Seasons Market blog statement regarding their fight with Whole Foods Market
Yesterday we heard from our attorneys that the Federal Trade Commission ruled that we have to turn our confidential internal financial, marketing and planning information over to Whole Foods Market. We disagree with and are disappointed in this decision. We’re huddling with the lawyers to figure out what our next step is going to be and I’ll get back to you once we have a clear direction. This isn’t over yet.
In the meantime, if you’re wondering why one of our competitors is demanding access to our private information, you can read about the details on this link.
Thanks again to the hundreds of people in Portland (and actually all over the country) who have offered us their support.
You’ll find a lot of information on the FTC and Whole Foods lawsuit here.
BOO! :( I am extremely disappointed by this, and though I’m already spreading the word and boycotting WF in favor of NS, will continue to do the same.
I am no longer shopping with the FTC!! Outrage!
Yeah…I’m done with Whole Foods. Though I didn’t shop there much to begin with….I live two blocks from a New Seasons.
Even aside from the FTC ruling, I prefer NS in so many ways. Friendlier staff, easier to find what I need….I don’t know, I just really like my market. ^_^
LOL @ gusto. I am no doubt numbed by a decade of commercial litigation, but this kind of thing happens every day so it’s hard to get too fired up. It’s basic third-party discovery — it sucks, but it is part of life for corporations. Ours is a litigious society with broad subpoena powers.
Looking at it from WF’s point of view, they are getting unfairly messed with by the FTC and there is not much else they can do to “prove” their case. (New Seasons even says they think the FTC case is bunk.) They don’t want to be spending this money and jumping through these hoops. NS is doing the best they can to object and and limit the scope of the discovery and who can see it, but taking it personally only hurts them more. They are understandably nervous but protective orders are real, and violating them can cost people their law licenses so it isn’t often done.
New Seasons is a GREAT market and they will be fine. Where else can you get local organic produce, fresh-baked artisan breads, and Coke Zero in the same store??? As soon as the FTC calls off the dogs the lawyers can move on to the next billing frenzy.
I am thoroughly disgusted with Whole Foods. Haven’t they taken over enough businesses already. I adore New Seasons soooo much more and wish they would expand their business into Vancouver. These demands alone are worth boycotting Whole Foods. Ridiculous!
This is ridiculous. Maybe everyone should just boycott the court because as hsawtelle notes, this happens every day. WF hasn’t done anything wrong. It’s litigation and every corporation does it, plain and simple.
Cuisine Bonne Femme says
“It’s litigation and every corporation does it, plain and simple.” Well, just because everyone is doing it, it doesn’t make it morally or ethically right…and I think people in Portland especially find the Whole Foods corporate model doesn’t jive well with their values. (perceived or otherwise). And I think it’s very smart for New Seasons to “take it personally” and expound upon it as such on their blog. It allows the public to see the huge waste of time and resources as pursued by BOTH WF and the FTC and allows the public to determine where their ultimate alliances are.
Whole Foods are predators and scumbags. Their many public quotes about crushing local competitors, etc. and their absolute and ongoing history of hypocrisy in their business practices vs. what they say in their PR spin illustrates this. If I need to pull out the countless examples for you, let me know.
Good point actually — NS has scored a nice PR win by playing up the David vs. Goliath angle. WF may well be predators/scumbags, which is what I think everyone wants to talk about, I just don’t see a connection between that and their use of a third-party subpoena in this case. But NS has effectively made the connection in the public eye, which is good for business.
You hit it square on the head hsawtelle. Everyone (especially NS) wants to make this the david v. goliath story rather than the litigation that it actually is. There is not a shred of evidence that WF is using what amounts to a very simple subpoena to “crush” anyone but that’s the immediate assumption. If you hate WF for some other reason, fine, your choice, but getting riled up over this just smacks of Portland’s liberal kneejerk attacks. CBF, if you want to talk corporate politics, fine. I’ve represented enough to know and this just is not that unusual. Predators and scumbags? Hardly. WF is a successful corporate chain grocer. they’re going to do fine even if you choose not to shop there. And by the way, do you really want to throw stones at PR when that’s exactly what New Seasons is using here to gain the sympathy vote? Read the opinion, it makes legal sense, whether you like it or not.
Cuisine Bonne Femme says
Hunter, like I said, it might not be “unusual” in the corporate realm and the FTC subpoena may be legal, but it still doesn’t make it ethically or morally right. In addition, I’m not throwing stones at PR. I’m pointing out all the bad PR moves from Whole Foods and what I would consider fairly brilliant PR moves from NS who are simply defending themselves and utilizing this to gain public sympathy (quite well I might add). That’s entirely different. Finally, I highly suggest you read through these threads carefully and do some research on exactly what Whole Foods has said about competition in Portland and elsewhere and how they have conducted themselves in the past. Like I said earlier – Predators and Scumbags and my opinion stands firm on that. And whether or not I as an individual chose to shop there is irrelevant, it’s the collective mass that matters. Judging from the large dive WF’s stock continues to take overall and the opinions expressed by the public (on this site and other places like the Oregonian and even the recent piece in the New York Times), I’d say WF might actually be in trouble. And I do encourage you to read the recent NY Times article which makes excellent points calling both the FTC and WF on the carpet. Thanks
I love WF just as much as I always have. Please pass the lobster cracker.
Speaking of protein, how I used to salivate for those testosterone charged, raw meat eating days in the commercial litigation trenches–until I really couldn’t stand it any more. Thankfully, I’ve crossed over.
Funny the divide b/w those with (obviously) legal backgrounds and almost everyone else. What makes perfect sense to the legally trained sometimes seems completely idiotic to those lacking “the knowledge.” Not sure if this is a commentary on much of anything–just an observation.
I wish I could comment substantively on the FTC/WF/NS conundrum, but I can’t. I tend to favor Food Front and the Farmers Market for everything, but Rohter has always seemed like a pretty stand up guy. Barely ever see the inside of NS or other food sellers–except Costco, but my tastes there mostly run to large quantities of paper goods, toiletries and cut-rate clothing. I hear Costco offers its own special array of anticompetitive (or is it competitive) tactics, but that’s something I read a few years back.
For those pissed at WF, sounds like you are doing all you can. Hard to say whether it will make much of a difference.
Now back to your regularly scheduled winter storm.
I received this email from WF. Any suggestions on what I should say if we talk?
I was forwarded your email today regarding the FTC Lawsuit against Wholefoods.
If you have a willingness to do so, I would like to take this opportunity to engage you in person. This issue has created some intense feedback and it’s important for me to make sure and address each customer willing to open that dialogue.
Please feel free to call the number below.
Justin S. Jackson
Vice President of Purchasing
Pacific Northwest Region
Whole Foods Market
#15 Lake Bellevue Drive, Suite 100
Bellevue, WA 98005
Food Dude says
We should all call him! ;)
He claims to want to address each customer willing to open a dialogue so there is no reason not to call him. I’ll try to be “Portland” courteous but that may not be easy.
No excuse for not being polite–where ever you hail from.
If this incident is enough to make someone boycott Whole Foods they surely shouldn’t have been shopping there in the first place. It doesn’t matter how lobster-friendly or morally inclined a corporation may or may not be, what WF is doing is still pretty much (pardon the pun) organic to being a publicly traded Fortune 500 company. They would be doing themselves and their shareholders and even their customers a disservice if they didn’t do everything they possibly could to fight the FTC (and, really, everything they possibly could to grow their business). It’s all well and good to be well and bothered by that – we’re just lucky to have an appealing, locally owned alternative – too bad we can’t say the same about our cell phones, internet service, first-run movie tickets, etc.
And if the FTC wasn’t dragging this out, this problem doesn’t exist. WF might not be the good guy, but if the FTC is going to use all their regulatory powers and legal remedies, so is WF. And so is New Seasons.
Also, while I take NS’s position that they don’t oppose the merger at face value, they (and all of the competitors WF went after, and other corporate supermarket chains for that matter) still stand to benefit if WF loses this case. Wild Oats isn’t coming back, which could well mean that some of those locations around the country either go away completely or become available to other ownership. That’s not NS’s problem either, but it’s at least ironic (on several levels). It seems especially cruel that the FTC’s alleged attempt to foster healthy competition is costing some of these indie competitors major money and major aggravation. Of course I can’t help but think that it’s Wal Mart/Kroger/Safeway that really wants the FTC to stick it to Whole Foods. Anything else is just crossfire.
Hey, Portland, you are a “big city” now, you can have BOTH NS and WF. Stop all this mud flinging, I want all my food outlets, please don’t start internet campains against corporate windmills.
hsawtelle, hunter and Jason are right, this is par for the course in corporate litigation. If you read the actual order, the documents WF is requesting will be vetted by the judge and WF management will not be privy to any ‘marketing secrets’. And any assertion that WF’s lawyers will try to find a way to slip WF mgmnt the info is ludicrous. Defying a judge’s orders gets you disbarred – no attorney would risk ending their careers over this. Those of you that are boycotting WF because of NS’s cries of unfairness are being played like fiddles by NS. I personally find NS’s tactics insulting to my intelligence. I’m NS’s mngmnt gets quite a chuckle reading comment threads like this after they post there ‘crying victim’ blog entries every few weeks.
PS -I am a regular shopper at the NE 33rd NS.
Mmm. The trouble here is that while you’re right — the subpoena/discovery process is indeed par for the course in civil litigation — WF’s past history indicates that they may indeed try to end-run the confidentiality rules, attorney-discipline consequences notwithstanding. And having looked at the docs linked at the top of the thread, NS is right that the penalties to WF (as opposed to counsel) in the event of violations are short on teeth. [This may have a lot to do with having the FTC, rather than a private plaintiff, on one side of the litigation.] Yes, responsible attorneys will abide by the rules…but not all attorneys are created equal, and money sometimes talks loudly.
The actual policy problem appears to be a specific artifact of anti-trust regulation — as a matter of principle, a private entity such as WF shouldn’t have the right to obtain this kind of detailed, confidential information from another private entity (NS in this case), especially without compensating them for it, absent a legal dispute in which both entities are active parties. In a legitimate anti-trust investigation, the government may have a reasonable interest in looking at such information in order to reach a judgment, but in such a case the data ought not pass through a competitor’s hands on the way to the judicial bench. The best answer here may be to seek reform through legislative channels; while that’s unlikely to help NS in the present case, it may help level the playing field for future anti-trust actions.
Sorry djonn, have to disagree. WF is fighting anti-trust issues which puts them against EVERY company out there. So New Seasons is involved. I may not like what WF is doing in discovery, but as an attorney I would do precisely the same thing to fight off the allegations.
I wouldn’t bet on legislative (or regulatory) discovery reform in this area. I don’t think anyone is even asking for that. Every subpoena is somewhat overbroad and every company kicks and screams when they get served with one to try to limit it. But if you ask them whether all third-party discovery should be abolished I doubt they’d agree with that. Today’s subpoena recipient could be tomorrow’s litigant . . .
Our discovery system can be a mess but it works most of the time. It fits into a complicated context of courts and agency tribunals. Sort of like the tax code, if you wanted to “fix” it you’d need more than a Band-Aid or two; you’d really need to start over.