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Starbucks sued for squashing competitors

LOS ANGELES – The owner of a small coffee company sued Starbucks Corp. on Monday, claiming the coffee shop’s anti-competitive business practices put her store out of business.

The suit, which seeks class action status, was filed in Seattle federal court by Penny Stafford, the owner of Belvi Coffee and Tea Exchange Inc.

According to court papers, Starbucks violated federal antitrust laws by leasing prime commercial real estate at above-market prices in return for the exclusive right to sell espresso drinks or specialty coffee in those locations.

A Starbucks spokeswoman said the Seattle-based company was not aware of the complaint and could not provide further comment.

The suit alleges that Belvi Coffee and Tea’s efforts to enter such buildings in Seattle and Bellevue, Washington were blocked by Starbucks “through unlawful use and abuse of its monopoly power.”

Starbucks is the world’s largest coffee shop chain, with more than 12,000 locations in 37 countries. The lawsuit alleges the chain “possesses monopoly power” because it has “at least” a 73 percent market share of the U.S. coffee shop industry.

Starbucks has said it has a less than 8 percent market share of all coffee consumed in the United States.

The suit also claims that, after Stafford found a space at one prime Bellevue office building, Starbucks employees “were directed to stand at the entrance of Ms. Stafford’s business for the purpose of handing out free Starbucks drinks.”

Stafford’s store closed four months after opening. She still operates one other store outside Bellevue’s main central business district.

The suit asks that Starbucks’ “exclusionary conduct be declared invalid” and seeks attorneys fees and other relief.

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