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Wal-Mart Loses Appeal to High Court

July 13, 2006|From Bloomberg News

Wal-Mart Stores Inc., which faces opposition in some areas to new stores, lost a bid Wednesday to overturn a San Joaquin Valley city's ordinance preventing it from building a superstore.

The California Supreme Court declined to review an appeals court decision upholding an ordinance in Turlock. The court didn't give a reason for its decision.

Turlock's law prohibits stores larger than 100,000 square feet from devoting more than 5% of their floor space to groceries. Wal-Mart sued the city in state and federal court, claiming it colluded with local grocers to restrict competition and failed to comply with environmental review and zoning laws. A federal court in Fresno sided with Turlock on July 3.

Wal-Mart has faced opposition in California and other states from towns and grocers that want to keep out large stores they say undercut local merchants and create traffic problems.

John Simley, a spokesman for Wal-Mart, didn't return a call seeking comment.

A judge in Modesto upheld Turlock's ordinance in December 2004 and a state appeals court denied Wal-Mart's bid to reverse the ruling in March. A federal court in Fresno threw out a similar case Bentonville, Ark.-based Wal-Mart filed against the city July 3. Turlock has 61,000 residents.

Shares of Wal-Mart fell 98 cents Wednesday to $45.15.

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