Big supermarket chain A just gave up on its plan to merge with big supermarket chain B.

I'm David Brancaccio, just hours after a federal court blocked Albertson's plan to merge with rival grocer Kroger.

There's word Albertsons has backed out of the deal and is filing a lawsuit.

Albertson CEO says the firm was, quote,

deeply disappointed in the court's rulings. It was to have been a $25 billion merger, which the

Federal Trade Commission in Washington, eight states in D.C., viewed as hurting competition with the

potential to drive up prices. Joining us live from Ann Arbor is Eric Gordon, a professor at the University of

Michigan's Ross School of Business. Eric Albertsons is also suing Kroger for what?

They're suing Kroger for breach of contract. These mergers are done pursuant to really long agreements.

This one's like 92 pages long, but it's basically a big contract. And in that contract,

Kroger agreed to use its best efforts to do whatever it took to close the deal, whatever it took

to satisfy the antitrust regulators, subject to a cap of not having to sell more than 650 stores.

Albertson says Kroger hasn't done that.

Kroger has breached the contract.

It damaged us.

And I think they're going to be seeking several hundred million dollars.

All right.

So they want some kind of, you know, payback for this.

And the two partners didn't want

to bet that the incoming Trump administration might be less inclined to push to block the merger,

or maybe since it was in the courts, it was too late for that? Yeah, apparently not. And that's a little

bit of a surprise. You know, last week they were allies against the government. Now they're going to

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