Tuesday, December 2, 2008

Retail Memo: Whole Foods' Paige Brady Responds to Yesterday's New Seasons Market Piece; Lots of E-Mails; Issue Heats Up On the New Seasons Market Blog

Our story from yesterday, "Retail Memo: Whole Foods Wants A Court-Mandated Financial Records Dump from Portland-based New Seasons Market; it Says For its Battle Against the FTC," has drawn a written response from Paige Brady at Whole Foods Market, Inc.

Additionally, we've received numerous e-mails today from readers of Natural~Specialty Foods Memo about the story and issue.

The issue also is heating up over on the New Seasons Market Blog. For example, when we published our story yesterday, citing the News Seasons Market Blog post by company CEO Brian Rohter, there were 10 comments on his post. At present, there are now 54 comments on his post here.

Below is the written response from Paige Brady of Whole Foods Market, Inc. to the New Seasons Market subpoena issue piece we wrote and published yesterday (it's also in the comments section of our story from yesterday):

Paige said...

Hey, Whole Foods Market here. We want to share our point of view with your readers. We are reading and listening to your concerns so we hope you’ll be open to reading ours.

The last year has been something of a nightmare for the administrative team members here who have been jumping through hoops to meet requests from the FTC. While our customers, our competitors’ customers, industry insiders and merger experts all seem to agree that customers have not been adversely affected by the Whole Foods Market/Wild Oats merger, the FTC continues to press their case forward.

While we would love to see this whole issue go away, we have no option but to defend ourselves against the FTC's ongoing effort. We know that New Seasons and many other fine natural foods stores are serving their customers well and that those customers, like ours, continue to have ample choices even after our merger with Wild Oats. Since the FTC insists that we have harmed these markets, we have to defend ourselves by showing that these markets are doing well. Part of our defense is based on gathering information from third parties through subpoenas, mostly from competing retailers but also from some vendors who supply Whole Foods Market.

We have not singled out New Seasons. Rather they are one of 96 companies (stores and vendors) that our outside legal counsel has subpoenaed. Why so many? The FTC has targeted Whole Foods Market in 29 different markets, and we must now defend against the claim that we do not face substantial competition from other supermarkets in all of these markets.

If we could defend ourselves without gathering information from competitors, we would. We don’t appreciate being put into this situation by the FTC. This is absolutely NOT an attempt to look into competitors’ information. In fact, no one inside Whole Foods Market will look at this information at all – only our outside counsel and their consultants are authorized to see the information gathered due to the FTC’s protective order. For those non-lawyers reading this, subpoenas and protective orders are a standard part of litigation practiced in virtually every antitrust case in the United States. The protective order prohibits any of this information from being shared with any Whole Foods Market team member, including in-house legal counsel. And while we understand that some of you will have trouble trusting the government system of protective orders, we give you our word that Whole Foods Market will not breach that trust.

We find it very unfortunate that the FTC’s ongoing pursuit to affect our merger (which was consummated more than a year ago) continues to be burdensome to Whole Foods Market, other stores like New Seasons, and U.S. taxpayers. We know the New Seasons and Whole Foods Market customers are a dedicated, caring group of people. We thank you for your concern for your local stores. Know that while we may not always see things eye to eye, we are working toward the same goal – making the world a better place through food choices.

(Posted by Whole Foods Market team member Paige Brady.)

December 2, 2008 5:37 PM

Natural~Specialty Foods Memo will be writing more on this issue tomorrow. Stay tuned.

1 comment:

Anonymous said...

Paige, I'm a senior management member of one of the 96 retail companies that received the subpoena. What written guarantees can Whole Foods provide us that none of its executives, or anyone besides the lawyers for that matter, will view our financial information?

We are thinking of fighting this like New Seasons is. We are even smaller than they are though and our lawyer is looking for 50-k upfront just to get started.

This is 50-k we can use in our stores. We have received no written guarantee in terms of my question above.