Dozen Republican AGs Back Kroger Challenge of FTC In-House Court

A coalition of 12 Republican attorneys general are backing Kroger Co.’s lawsuit alleging that the Federal Trade Commission’s administrative law tribunal violates the Constitution’s separation of powers.

Led by Ohio Attorney General David Yost, the top state law enforcers in a Monday brief threw support behind the supermarket chain’s claims that FTC administrative action against its tie-up with Albertsons Cos. Inc. should be enjoined on the grounds that FTC administrative law judges enjoy unconstitutional protections from removal.

Kroger brought the complaint in the US District Court for the Southern District of Ohio in August as it fights an a series of challenges over its proposed $24.6 billion acquisition of Albertsons. The FTC claims that the deal will drive up grocery prices and hurt worker wages.

“The FTC’s judges are part of the executive branch, and that means they’re supposed to be subject to removal by the president,” Yost, who has voiced support for the Kroger-Albertsons deal, said in a statement. “Their multilayered protections from removal undermine the president’s authority and violate the constitution.

State AGs from Alabama, Georgia, Iowa, Louisiana, Montana, Nebraska, Oklahoma, South Carolina, Tennessee, Texas, and West Virginia also signed the brief.

They cited recent Supreme Court decisions such as SEC v. Jarkesy, a June opinion that curbed the SEC’s ability to press complaints before in-house judges.

The brief also noted that the Fifth Circuit found the SEC’s administrative law judge removal scheme to be “invalid on precisely this ground.” The Supreme Court, however, didn’t weigh in on that issue in its July decision.

Administrative law judges are generally protected from removal unless there is “good cause.”

The FTC said in a Sept. 16 filing that such an arrangement gives those judges a “qualified right of decisional independence” and that Kroger’s arguments misunderstand the law.

The agency has also pushed for moving the case to the District of Oregon, which last week wrapped up a bench trial on the FTC’s request to halt the Kroger-Albertsons deal.

The FTC wants a preliminary injunction to allow for its in-house case to proceed, but Kroger has said the deal will be off if an injunction is granted.

The case is Kroger Co. v. FTC, S.D. Ohio, 1:24-cv-00438-DRC, 9/23/24