Calgary Co-op suing Federated Co-operatives Ltd.

Calgary Co-op is suing Federated Co-operatives Ltd. (FCL) over what it says is the supplier's "oppressive conduct" following the retailer's decision to switch to a private wholesaler for grocery purchases, according to a Calgary Herald story.

Last August, Calgary Co-op announced it planned to begin purchasing food from Save-On-Foods beginning Spring 2020.

Calgary Co-op filed a statement of claim on Feb 10 saying it had suffered financially as a result of what it says was a "retaliatory response" by FCL to the loss of its largest grocery contract. 

The Calgary Herald story notes that "the suit alleges that FCL - which is collectively owned by more than 170 independent retail co-operativs across Western Canada, including Calgary Co-op - aimed to deprive Calgary Co-op of patronage returns it would otherwise be owed in the wake of the retailers's decision last August to move its grocery business to the distribution arm of B.C.-based Save-On-Foods."

The story states that "the suit also alleges FCL changed its bylaws “solely with a view to jeopardizing Calgary Co-op’s interests” and has made it economically prohibitive for Calgary Co-op to withdraw from Federated entirely.

"The lawsuit is the latest development in an increasingly acrimonious spat between two major Prairie brands. Calgary Co-op, which had sales of $1.3 billion in 2018, said last summer its move to a private grocery supplier — which will take effect in April — was necessary due to an increasingly competitive retail environment and the need to provide co-op members with wider product selection and better value."

Read the full story here.

 

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