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UPDATE 1-Whole Foods requests rehearing on Wild Oats ruling

Wed Aug 27, 2008 7:07pm EDT
 
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(Adds details on request for rehearing)

WASHINGTON, Aug 27 (Reuters) - Premium grocer Whole Foods (WFMI.O) has asked a U.S. appeals court to review its earlier decision that threw into question the legality of its already completed merger with former rival Wild Oats, the company said on Wednesday.

A three-judge panel of the U.S. Court of Appeals for the District of Columbia ruled on July 29 that a district court judge erred when he turned down a Federal Trade Commission request for an injunction to block the deal. With that decision, the appeals court essentially revived the government's antitrust case after the merger was done.

In a court filing on Tuesday, Whole Foods asked for an "en banc" rehearing -- which would involve all of the court's 13 judges. The company said the decision from the three-judge panel had created conflicts on the standards for granting preliminary injunctions, the methodology for market definition and the analysis of competitive effects.

Separately, the company asked the FTC, which is assessing whether its merger with rival Wild Oats is legal, to use an administrative law judge to hear the case, not a commissioner already on record as questioning the merger.

The FTC has named Commissioner Thomas Rosch to oversee the case, but Whole Foods said he should recuse himself, citing the fact that he was one of the commissioners who voted in June 2007 to investigate the merger as one that potentially violates antitrust statutes.

"The commission should recuse itself and appoint an independent ALJ (administrative law judge) to preside over the trial of this matter," Whole Foods said in a motion filed with the FTC on Aug. 22. It was posted on the FTC website on Wednesday.

The next hearing is a scheduling conference set for Sept. 8.

The commission had sought to challenge the merger last year, but Judge Paul Friedman of the U.S. District Court for the District of Columbia refused to issue a preliminary injunction stopping the merger. The merger was finalized in August 2007.

The commission is one of two agencies that assesses whether mergers violate antitrust law. (Reporting by Diane Bartz and Lisa Baertlein; Editing by Gary Hill, Phil Berlowitz)

 

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