Watch Your Hormone-Free, Grass-Fed, Free Range Tongue

Why buy your biggest rival? To "avoid nasty price wars," of course. To smother competition. To close out the industry to any meaningful new entrants.

It's just what one might expect to hear from any organically raised red-meat-eating executive worth his stock options. Problem is, the Federal Trade Commission and other law enforcement authorities entrusted to apply antitrust protections take a dim view of such strategies.

Just ask John Mackey, chief executive of Whole Foods Market, who is in the process of acquiring his company's nearest competitor, Wild Oats Markets.

Or at least he was in the process until the feds stepped in -- with transcripts of some ill-considered remarks that Mackey made to his board in explaining the logic of his Wild Oats deal...

According to a legal pleading for a court order blocking the merger, Mackey "bluntly advised his board of directors of the purpose of this acquisition: 'By buying [Wild Oats] we will ... avoid nasty price wars in Portland (both Oregon and Maine), Boulder, Nashville, and several other cities....'"

Ouch.

But that's not all.

"By buying [Wild Oats]," Mackey adds, according to the F.T.C.'s transcript, "... we eliminate forever the possibility of Kroger, Super Value, or Safeway using their brand equity to launch a competin national natural/organic food chain to rival us."

Mackey concludes: "Eliminating [Wild Oats] means eliminating this threat forever, or almost forever."

The threat, of course, being competition in a free market.

A few days after the F.T.C. filed the complaint with these quotes, Whole Foods and Wild Oats meekly consented to a restraining order temporarily blocking their merger.

The complaint was sealed at the time, but released to the public today at the request of news organizations.

by Mark Stein