The Bellingham Business Journal
Grocery store chain Haggen settled its $1 billion lawsuit with Albertsons for only a fraction of what it was seeking, according to documents filed with the U.S. Securities and Exchange Commission Friday.
Albertsons agreed to pay $5.75 million in cash to to the creditors for the bankrupt Haggen. Albertsons also agreed to transfer another $8.25 million in an unsecured claim against Haggen to other creditors.
The deal was reached Thursday, according to the documents filed by Albertsons with the SEC.
The settlement must still be approved by the U.S. Bankruptcy Court.
In December 2014, Haggen agreed to purchase 146 grocery stores as part of last year’s merger between Albertsons and Safeway. The first store that Haggen took over was the Albertsons in Monroe.
Problems emerged almost immediately and Haggen blamed Albertsons for, among other things, attempted to draw away Haggen’s customers by using confidential information, providing incomplete and misleading inventory data and pricing information, and deliberately understocking and overstocking inventory at the new Haggen stores.
On Sept. 1, Haggen filed lawsuit against Albertsons, asserting that if it was destroyed as a competitor that its damages may exceed $1 billion.
Just a week later, on Sept. 8, Haggen filed for bankruptcy. Since then, the company has been shedding stores onthe West Coast, including selling some of the stores back to Albertsons.
Haggen is now planning an auction to sell its core stores. That auction is scheduled for Feb. 5.