A coalition of immigrant-owned grocery store and bodega owners has filed a lawsuit against Mayor Zohran Mamdani and the city to block his plan to open five government-subsidized supermarkets across the five boroughs.
The Multicultural Business Coalition (MBC), representing hundreds of small business owners, filed the class-action lawsuit in New York County Supreme Court on Monday. The suit argues that the city-run stores, which would offer essential items at 30% below market rates, would create an unfair competitive advantage that threatens the survival of existing neighborhood grocers.
“They cannot possibly compete because no one will be subsidizing them,” Mark Jaffe, the group’s general counsel and president of the Greater New York Chamber of Commerce, told CNN.
The Core Argument
The lawsuit alleges the city’s plan violates state civil rights laws and the equal protection clause of the State Constitution. Plaintiffs argue the plan discriminates against Latino, Asian, and other immigrant business owners who operate on razor-thin profit margins and cannot match discounts offered by government-subsidized stores.
The coalition also claims the city failed to conduct a proper economic impact study before announcing store locations, accusing officials of “arbitrary site selection” without analyzing how the stores would affect nearby businesses.
“The Puerto Ricans were the bodega pioneers and they were followed by the Dominicans, the Arabs, the Koreans, the Chinese and finally my Mexican business members,” said Jairo Guzman, president of the NY State Mexican Chamber of Commerce. “Food retailing–from bodegas to supermarkets–is New York City’s great mosaic. Mayor Mamdani needs to withdraw his disastrous plan and work with us.”
The Walmart Comparison
The lawsuit draws a direct parallel to Walmart, which has long been kept out of New York City over fears its low prices would decimate small businesses. The suit argues the municipal grocery stores would present the same threat – a government-backed version of a deep-discount retailer that small grocers cannot match.
Mamdani’s Defense
Mayor Mamdani defended the program at a Monday press conference, expressing confidence in its legality and necessity.
“We’re talking about delivering five city-run grocery stores in a city of eight and a half million people that has more than 1,000 grocery stores,” Mamdani said. He pointed to existing city-subsidized markets like Manhattan’s Essex Street Market, which he said has not harmed nearby businesses. City officials also noted the stores would not sell cigarettes, prepared food, or lottery tickets – items that provide significant revenue for bodegas.
“We are talking about a reflection of a cost-of-living crisis that has seen grocery prices increase by about 30 percent over the last few years,” Mamdani said.
The Stakes
The city has already allocated $70 million for the initiative, which aims to open one store in each borough by 2029. The first location, in Hunts Point in the Bronx, is scheduled to open in 2027, followed by a store in East Harlem.
City officials say the stores could save a typical shopper about $90 a month – more than $1,000 a year – through discounts on a core basket of groceries. The city is currently seeking proposals from private operators to manage day-to-day operations.
MBC President Kenneth Roldan stated the coalition remains open to negotiation, asking City Hall to “sit down with us” rather than fight in court.
The Bottom Line
A coalition of New York City grocery store and bodega owners has sued Mayor Zohran Mamdani over his plan to open five city-run supermarkets, arguing the government-subsidized stores would cause unfair competition and discriminate against minority-owned businesses. The mayor defended the plan, calling it a necessary response to the cost-of-living crisis. The lawsuit seeks to block the initiative until the city completes a proper economic impact study.
