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Lawmakers: Grocery giants ripped off customers with inaccurate labels, charged higher prices than advertised.
“All U.S. customers should be protected from predatory pricing,” write lawmakers
November 4, 2024 - Washington, D.C. – On Monday, U.S. Senator Elizabeth Warren (D-Mass.) and Congressman Adam Schiff (D-Calif.) led their colleagues in writing to Chair of the Federal Trade Commission (FTC), Lina Khan, and Secretary of the Department of Agriculture, Thomas Vilsack, urging them to investigate Albertsons and other major grocery chains for predatory practices that could have violated federal laws.
In October 2024, California District Attorneys reached a nearly $4 million settlement with grocery chain Albertsons and its subsidiaries Safeway and Vons to resolve allegations that the companies engaged in “false advertising and unfair competition.” Specifically, the grocers “unlawfully charged customers prices higher than their lowest advertised or posted price” and overcharged customers by placing “inaccurate weights on the labels of their products.” For example, while their products were supposed to be sold based on an item’s net weight, they would wrongfully overcharge customers by including the weight of the packaging in the cost.
“Albertsons is one of the largest food retailers in the United States, boasting over 2,200 stores across the country. This settlement covers the 589 Albertsons stores in California, but all U.S. customers should be protected from predatory pricing,” wrote the lawmakers. “To ensure that no Albertsons stores are overcharging customers for essential groceries, we urge the FTC and U.S. Department of Agriculture to investigate whether any other Albertsons stores or other major grocery chains have committed similar wrongdoing and, if necessary, hold the responsible parties accountable.”
The lawmakers request comes as large grocery companies have doubled down on using their significant market power to hike prices for essential goods and take advantage of customers.
For example, Stop & Shop charged higher prices at a largely minority, working-class, urban location in Boston, Massachusetts than it did at a suburban store location, placing a significant burden on already-struggling consumers. Grocery giant Kroger Company (Kroger) has adopted digital price tags in its stores, which may allow the company to surge grocery prices and exploit consumers. And the proposed $24.6 billion merger between Kroger and Albertsons is poised to further drive up grocery prices and harm grocery store workers and consumers.
As a champion for American consumers and a secure and healthy economy, Senator Warren has engaged in oversight of corporations that unfairly exploit consumers. She has also been calling for more competition and stronger enforcement of antitrust laws to bring down prices for families:
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In October 2024, Senators Elizabeth Warren, Bob Casey, and Ron Wyden slammed McDonald’s for squeezing customers with excessive price increases.
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In October 2024, United States Senator Elizabeth Warren, along with Senator Bernie Sanders and Representatives Jan Schakowsky, Hank Johnson, Matt Cartwright, Sheila Cherfilus-McCormick, Rosa DeLauro, Maxwell Frost, Pramila Jayapal, Darren Soto, Mark Takano, Paul Tonko, and Frederica Wilson wrote to Chair of the Federal Trade Commission, Lina Khan, on reports of widespread price gouging in states impacted by Hurricanes Helene and Milton and on the need for a federal price gouging ban to complement state-level efforts.
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In October 2024, Senator Elizabeth Warren and Representative Madeleine Dean wrote to the CEOs of Coca-Cola, PepsiCo, and General Mills, pressing their executives on the companies’ pattern of profiteering off consumers, both through “shrinkflation” and dodging taxes on the profits they made from that price gouging.
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In September 2024, U.S. Senators Elizabeth Warren and Ed Markey, and Representative Seth Moulton demanded answers from 13 corporate landlords operating in Massachusetts as to whether they are using RealPage’s algorithm to raise rents for families.
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In August 2024, Senators Elizabeth Warren and Bob Casey sent a letter to Rodney McMullen, chairman and CEO of Kroger, raising concerns about Kroger’s use of Electronic Shelving Labels (ESLs) to potentially surge grocery prices and exploit consumers.
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In May 2024, while chairing a Senate Banking Subcommittee on Economic Policy hearing, Senator Warren called out giant corporations for hiking up food prices while raking in record profits, and urged action to promote competition and bring down costs.
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In May 2024, Senator Warren and Rep. Jim McGovern led a group of lawmakers in a letter to President Joe Biden, urging the Biden administration to use its executive authority to take action to lower food prices.
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In May 2024, during a hearing of the U.S. Senate Committee on Banking, Housing, & Urban Affairs, Senator Warren called out food industry price gouging and urged action to combat unfair pricing practices.
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In April 2024, Senator Warren, Bob Casey, and Ben Ray Luján wrote to DoorDash and UberEats, the two largest delivery platforms, calling out their use of hidden junk fees.
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In March 2024, Senator Elizabeth Warren and Representative Mary Gay Scanlon led a group of 14 lawmakers in a letter to FTC Chair Lina Khan urging the agency to revive enforcement of the Robinson-Patman Act (RPA), a critical tool to promote fair competition in the food industry.
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In February 2024, Senator Warren joined Senator Bob Casey in introducing the Shrinkflation Prevention Act to crack down on corporations that deceive consumers by selling smaller sizes of their products without lowering prices.
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In February 2024, Senators Warren, Baldwin, Casey, and U.S. Representative Jan Schakowsky reintroduced the Price Gouging Prevention Act of 2024, which would protect consumers and prohibit corporate price gouging by authorizing the FTC and state attorneys general to enforce a federal ban against grossly excessive price increases.
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In February 2022, at a hearing, Senator Warren called out corporations for abusing their market power to raise consumer prices and boost profits.
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At a January 2022 hearing, Senator Warren pressed Fed Chair Jerome Powell on the role of corporate concentration in driving up prices for consumers during his renomination hearing to be Chair of the Board of Governors of the Federal Reserve System.
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In a New York Times op-ed published in April 2020, Senator Warren urged Congress to focus on cracking down on price gouging in its ongoing effort to address the impact of the coronavirus pandemic.
Source: Senator Elizabeth Warren
