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The FTC allowed, in accordance with its regulations, a
comment period during which the public was invited to submit
comments on the proposed consent order. The attorney general of
California submitted comments expressing concern that American
Stores’ acquisition of Lucky Stores would reduce competition in
the retail supermarket industry in California.
The FTC entered a final consent order on August 31, 1988.
On September 1, 1988, the State of California filed suit against
American Stores, ABAC, and Lucky Stores in the United States
District Court for the Central District of California (District
Court). The State of California claimed that the merger violated
Federal and State antitrust laws by decreasing competition in the
supermarket industry in California. The State of California
requested various forms of relief, including rescinding the
merger transaction, a divestiture of Lucky Stores or,
alternatively, a permanent “hold separate agreement” like the one
that American Stores had entered into with the FTC.
The District Court issued a temporary restraining order
against American Stores and Lucky Stores on September 29, 1988.
The order required the continuation of the hold separate
agreement and the maintenance of the status quo at American
Stores and its subsidiaries and Lucky Stores and its subsidiaries
until a hearing on the preliminary injunction could be held. The
opinion of the District Court in this matter was published as
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