Costco, Price Enterprises Reach Pact With Shareholders

ISSAQUAH - PriceCostco Inc. and Price Enterprises Inc. have resolved a lawsuit with shareholders who sued over terms of Costco Wholesale's 1993 merger with Price Co. and subsequent separation.

The October 1993 merger was terminated in December 1994, when Price Enterprises was created to spin off its own retail and real-estate business.

Shareholders sued both companies, claiming that PriceCostco "didn't get a fair deal in the transaction," said PriceCostco spokesman Richard Galanti.

To appease the shareholders and settle the lawsuit, Price Enterprises has agreed to stop using the Price Club and Costco Wholesale trademarks in its stores in Central America, Australia and New Zealand. Price Enterprises also will allow PriceCostco to compete in some of its markets that were off limits under earlier agreements. Shareholders will benefit from these steps as PriceCostco's business improves, Galanti said.

Shareholders will not receive any payments, but Price Enterprises will pay for shareholders' court costs. PriceCostco runs a national chain of membership wholesale warehouses.