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Companies sue chocolate makers
Charge suppliers with price fixing
Saturday, March 29, 2008

Chocolate wars are bubbling up in the nation's courts, with grocers, vending companies and drugstore chains lining up to sue chocolate manufacturers under investigation for price fixing.

O'Hara grocer Giant Eagle this week filed suit in the U.S. District Court in Western Pennsylvania accusing its suppliers -- The Hershey Co., Mars, Nestle and Cadbury Schweppes -- of charging artificially inflated prices from 2002 and on. The grocer said it spent more than $112 million on Hershey products alone during the period.

A week earlier, rival drugstore chains CVS Pharmacy Inc. and Rite Aid Corp. filed a similar lawsuit in eastern Pennsylvania, also seeking treble damages. Yet another lawsuit filed in that court paired up drugstore operator Walgreen Co. with grocers Kroger and Safeway Inc.

In a regulatory filing in February, Hershey noted that it was party to almost 50 civil antitrust suits in the United States and three in Canada.

In making their cases for damages, plaintiffs are citing information coming out of the Canadian Competition Bureau, which has been investigating a number of chocolate makers. European and U.S. authorities also have been looking into the situation.

Those suing allege that the industry was facing a slowdown in sales in 2000 and 2001, so certain individuals met to discuss raising prices and keeping out competition.

Hershey said, in its regulatory filing, that it was cooperating with the government investigations and intended to defend the lawsuits vigorously. The central Pennsylvania company said the proceedings should not have a material adverse effect on results.

Teresa Lindeman can be reached at tlindeman@post-gazette.com or 412-263-2018.
First published on March 29, 2008 at 12:00 am