The Washington state Supreme Court has swept aside the last legal obstacle to a $4 billion dividend by Albertson to its shareholders ahead of a controversial proposed merger with rival Kroger.
On Tuesday, the state's highest court refused to review a case against the dividend brought by state Attorney General Bob Ferguson. Ferguson had argued that the hefty payment could financially weaken Albertsons and lead to closures of locations of Albertsons and of Safeway, which Albertsons owns.
In a terse, two-page ruling, however, the court declined to review the case or extend a temporary restraining order blocking the dividend.
Albertsons wants to pay the dividend to shareholders ahead of its proposed $25 billion merger with Kroger, which owns QFC and Fred Meyer.
"We respect the decision of the Court, but we are surprised and disappointed the Supreme Court decided not to hear this case," Ferguson said in a statement Tuesday afternoon.
Ferguson's case was the final obstacle to the dividend after a federal judge in Washington, D.C., rejected similar efforts by California, Illinois and the District of Columbia.
In a statement Tuesday, Albertsons said it would "immediately begin the process of paying" the $4 billion dividend.
Grocery-store closures have been a major concern in the Seattle area, where Albertsons and Kroger have nearly 200 locations. Kroger and Albertsons have both repeatedly rejected that argument.
Grocery unions also expressed dismay at Tuesday's ruling.
"We are disappointed to see a ruling that favors a small number of ultra-wealthy shareholders over the many thousands of essential workers and millions of Americans who will be left to suffer the consequences of the outright financial looting of Albertsons," read a joint statement by several grocery unions, including United Food and Commercial Workers International, Local 3000, which represents workers at Seattle-area Albertsons and Kroger stores.
Tuesday's ruling doesn't affect the months-long approval process for the proposed Kroger-Albertsons merger, which can be held up by both federal and state regulators, Ferguson said.
"This merger is far from a done deal," he said. "My team and I will be conducting a thorough review."
