Red Apple To Pay $600,000 Civil Penalty for Failing To Divest Manhattan Supermarkets as Required by FTC

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Federal Trade Commission attorneys have filed in federal district court an agreement the Commission reached with Red Apple Companies, Inc. and its chairman, John Catsimatidis, and two other firms, under which the supermarket operators will pay a $600,000 civil penalty for failure to divest five Manhattan supermarkets.

Red Apple, Catsimatidis, Supermarket Acquisition Corp. and Sloan’s Supermarkets, Inc., all of New York City, had agreed as part of the settlement of an FTC administrative complaint to divest the stores by March 1996. The settlement was designed to restore supermarket competi tion which, the FTC alleged, had been substantially reduced in four areas of Manhattan due to Red Apple’s acquisitions of Sloan’s supermarkets between 1991 and 1993. The FTC said in the court papers filed today that only one of the six divestitures originally required under the order has been accomplished.

"This is a substantial civil penalty," said William J. Baer, Director of the FTC’s Bureau of Competition. "Securing penalties where a seller fails to divest in a timely manner emphasizes the Commission’s commitment to securing prompt divestitures so that anticompetitive acquisitions will not result in higher prices."

The Commission vote to accept the civil penalty settlement was 5-0. It was filed in U.S. District Court for the Southern District of New York today, and is subject to court approval.

The FTC also noted that, on Sept. 13, it modified the order to delete a divestiture originally required in the Chelsea area, and appointed a trustee to complete the remaining four divestitures of stores in the Upper East Side, the Upper West Side and Greenwich Village. Shortly thereafter, Red Apple itself submitted divestiture applications for the four stores, so the Commission has not yet activated the trustee. The divestiture applications are pending.


Copies of the new complaint and civil penalty settlement, as well as other documents associated with this case, are available from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases, related documents and other materials also are available on the Internet at the FTC’s World Wide Web site at:


(FTC Docket No. 9266)
(Civil Action No. 97 CV 0157)


Contact Information

Media Contact:
Bonnie Jansen
Office of Public Affairs
202-326-2161 or 202-326-2180
Staff Contact:
Bureau of Competition
William J. Baer, 202-326-2932
George C. Cary, 202-326-3741
Daniel Ducore, 202-326-2526
Elizabeth Piotrowski, 202-326-2623