Food - Drink
Why Grocery Chain Haggen Once Sued Albertsons
By KATIE HORST
In 2015, grocery giant Albertsons approached Pacific Northwest-based chain Haggen with an offer to expand their brand into California, Nevada, and Arizona by purchasing 146 Albertsons stores, which would help to accommodate Haggen's merger with Safeway. Haggen jumped at the opportunity and paid $1.4 billion, but things didn’t go as planned.
Just six months after the deal, Haggen filed for bankruptcy following a $41.1 million dollar lawsuit by Albertsons for unpaid inventory, which led Haggen to close 27 of their new locations. Haggen fought back by suing Albertsons for $1 billion, an amount for triple damages plus fees, claiming that Albertsons essentially sabotaged their expansion.
Haggen's lawsuit claimed that Albertsons reported muddled data, didn't provide software that was promised, understocked stores, and made Haggen's prices too high by supplying misleading price information. Another six months later, a settlement was reached, and Haggen walked away with a mere $5.75 million cash settlement.