Economics

Can Organic Eggs Be Unscrambled?

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Trust Buster

The phrase trust-busting always conjures sepia-toned images of pince-nez, Rough Riders, and bushy mustaches to me. But it's actually is alive and well: Yesterday, Whole Foods—apparently the Standard Oil of the 21st century—was hauled back out on the Federal Trade Commission's chopping block.

In early 2007, Whole Foods merged with another organic grocery chain, Wild Oats. The FTC decided that this looked like a trust that needed busting, arguing that "core" organic consumers would be stuck with only the Whole Food/Wild Oats hybrid for their shopping. We're talking about the people who need quinoa like turn-of-the-century householders needed their lamp oil.

A fast track decision let the merger continue, accepting Whole Food's argument that Wal-Mart and other traditional grocery stores have greatly expanded their organic offerings, and that even after the merger the chain has plenty of competition. But now an appeals court has revived the case by bouncing it back down to the lower court, crying out: Think of the tempeh eaters! 

Whole Foods has already closed four Wild Oats stores, and 27 have become Whole Foods locations. The transition continues during this round of the appeal—the company says it will go ahead with "business as usual," and the markets seem to believe them, since Whole Foods stock closed up 1.6 percent yesterday. Or as Richard E. Donovan, co-chairman of the antitrust practice at Kelley Drye & Warren in New York put it to The New York Times:

"The eggs are already scrambled. What are you going to do?"

Cage-free, organic eggs, one assumes.

More on Whole Foods and reason donor John Mackey here and here.