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SKIATOOK, Okla. -- Checking competitors' prices is common practice in the supermarket industry -- but is it legally a slippery slope? Industry players and watchers are asking the question, in the wake of a recently filed lawsuit in which the owners of a Super H supermarket here claim that Wal-Mart workers stole proprietary information from scanning Super H shelf bar codes.
In the suit filed in Osage County District Court, Super H says Wal-Mart Stores, Inc. sent employees to illegally scan bar codes on Super H shelves. The plaintiff alleges the Wal-Mart employees were gathering intelligence in preparation for the opening of a new Wal-Mart supercenter near Super H's store in August.
Legal experts are pondering the implications of the suit. Price checking is a common practice among supermarkets, and does not violate antitrust laws, according to James Fishkin, a Washington-based counsel in the antitrust group of Dechert LLP.
"The mere act of retailers collecting publicly available pricing information, whether they use notepads or electronic devices, isn't by itself a violation of the antitrust laws," Fishkin told Progressive Grocer. "Many supermarkets allow one another to do this."
Retail prices are publicly available information. A potential legal question, however, is whether a retailer can gain proprietary information from scanning its competitors' bar codes as Wal-Mart is being accused of having done, Fishkin noted.
An attorney for Super H was quoted in reports as saying it is illegal to use a scanner to get Super H's information about "cost, inventory, and other details."
The Osage County District Attorney has declined to pursue criminal trespassing charges in the case. However, the judge granted Super H's request to prohibit police from returning the scanner to Wal-Mart, and ruled that Wal-Mart was "stealing price code information from products in plaintiff's store," according to reports.
A Wal-Mart spokeswoman told Progressive Grocer, "Wal-Mart strives to be the low-price leader in every community that we serve. It is not uncommon for retailers, including Wal-Mart, to verify this by checking prices of comparable items at other retailers in town. In fact, on the very day that the alleged incident occurred, Super H also visited Wal-Mart to compare prices.
"Wal-Mart's policy is to comply with the law in every community we serve. Wal-Mart did not violate the law, and will vigorously defend this lawsuit," the spokeswoman noted.
-- Jenny McTaggart