Sunday, December 7, 2008

We're Just Trying To Mind Our Own (Local) Business--Updated Sunday December 7th

The Oregonian has published their third piece in the last five days about Whole Foods Market’s demands for our internal emails, weekly sales data and marketing and growth plans. Here’s the link to it and here’s the link to the editorial that ran on Thursday and the story that ran on Wednesday.

We're very encouraged by the incredible amount of interest in this situation. We’ve heard from media outlets from all over the country and our blog continues to get lots of comments (although to be honest, in the last couple of days, it kind of looks like the same person is posting there over and over again).

Just to review the situation—Whole Foods Market is in a dispute with the Federal Trade Commission (FTC) about their takeover of Wild Oats. As it turns out, because of this dispute, Whole Foods has an opportunity to try and force us to give them copies of some of our most confidential financial records and strategic plans. We think there are lots of other ways they can make their case with the FTC without putting us at such a big risk. Want more information? Here’s the link to my original blog explaining the situation in detail.

There are a few things I’d like to comment about in today’s Oregonian story.

Whole Foods continues to insist that the documents they are demanding from us will be safe and that only their “outside lawyers” will see them. This is exactly same promise that was made last time files were subpoenaed in this case. Unfortunately, in the middle of that round, Whole Foods filed an amended motion to allow their “inside lawyer” to see the confidential information. They claimed that even though this “inside lawyer” was an employee of Whole Foods and was on their “Leadership Team”, it was okay for her to see everyone else’s private data because she wasn’t engaged in “competitive decision making”. Obviously, we’re very worried that might happen again.

Whole Foods also doesn’t seem to want to talk about the actions and the statements of some of their corporate executives which have led us and so many others to be concerned. If they hadn’t said stuff like, “…[m]y goal is simple – I want to crush them and am willing to spend a lot of money in the process.” and “...elimination of a competitor in the marketplace, competition for sites, competition for acquisitions, and operational economies of scale. We become the Microsoft of the natural foods industry.” and if their CEO John Mackey had not been caught posting derogatory information online about Wild Oats, using a made up screen name, we might not be quite as worried about what they planned to do with our private internal files.

The Oregonian mentions that Whole Foods is willing to make some “tweaks” to please us. That’s an accurate statement. Tweaks they are. Whole Foods is still demanding almost everything and is still insisting on the files we’re most concerned about.

The article states that we’re the only company looking to legally avoid the subpoenas. We have some new information about that. As of last Friday, only 50 of the 93 companies that have been subpoenaed have responded. The subpoena we got from Whole Foods demanded that we turn over all of our files to them on November 4th—over a month ago. I’m assuming that all the other companies had the same deadline. That means that almost half of the companies subpoenaed have not complied yet. I know for sure that some other grocers are waiting to see what happens with us before they decide what to do.

I’ve stated repeatedly, to the FTC and the media and Whole Foods that I think it’s silly to imagine, even for a second, that Whole Foods has some kind of monopoly on selling natural and organic foods in the Portland area. Having said that, I certainly am not an expert on the other 28 cities that are involved in this and I don’t have an opinion one way or the other about what should happen there.