American Stores Company and Subsidiaries - Page 9




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          State of Cal. v. American Stores Co., 697 F. Supp. 1125 (C.D.               
          Cal. 1988).  American Stores appealed the decision of the                   
          District Court.  The Court of Appeals for the Ninth Circuit                 
          published its opinion in that appeal as State of Cal. v. American           
          Stores Co., 872 F.2d 837 (9th Cir. 1989).  The Court of Appeals             
          affirmed the District Court's finding that California had shown a           
          likelihood of success on the merits of the case and possible                
          irreparable harm.  The Court of Appeals, however, found that the            
          preliminary injunction ordered by the District Court was                    
          tantamount to an indirect divestiture which was not a remedy                
          available to private plaintiffs under section 16 of the Clayton             
          Act.  The United States Supreme Court granted certiorari to the             
          State of California.  See California v. American Stores Co., 493            
          U.S. 916 (1989).  Prior to granting certiorari, Justice O’Connor            
          entered a stay continuing the District Court’s injunction pending           
          further review by the Supreme Court.  See California v. American            
          Stores Co., 495 U.S. 271, 278 (1990).                                       
               The Supreme Court reversed the judgment of the Court of                
          Appeals for the Ninth Circuit and remanded the case for further             
          proceedings.  The Supreme Court held that divestiture is a form             
          of injunctive relief within the meaning of section 16 of the                
          Clayton Act and that the District Court had the authority to                
          divest the acquirer of any part of the acquirer’s ownership                 
          interest in the acquired company.  See id.  The Supreme Court               






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