Small Grocers Sue NYC Mayor Mamdani Over Proposed City-Run Grocery Stores
Mayor Zohran Mamdani announces The Peninsula in the Bronx as the second planned location for New York City’s municipal grocery-store program. The Multicultural Business Coalition’s legal challenge seeks to halt the program pending further study. Kara McCurdy/Mayoral Photography Office.
A business coalition representing small New York City grocers has filed two related legal actions seeking to block Mayor Zohran Mamdani’s proposed municipal grocery program. The group argues that the city failed to study whether deeply discounted public stores would harm immigrant- and minority-owned businesses.
The Multicultural Business Coalition Inc. filed an Article 78 petition and a separate proposed class-action complaint in New York County Supreme Court. The coalition alleges that the city’s New York City Groceries Program—which calls for five city-owned grocery stores selling staple goods at prices up to 30% below market rates—could force private supermarkets, bodegas, and grocery stores out of business.
The lawsuits name Mayor Mamdani, in his official capacity, and the City of New York as defendants.
What the Filings Seek
The Article 78 petition asks a judge to permanently enjoin the city from opening or operating the stores until officials conduct land-use reviews and analyze the program’s economic effects on nearby independent grocers.
The separate class-action complaint seeks to proceed on behalf of the coalition’s members and similarly situated non-members. It alleges violations of New York civil rights laws and the equal protection clause of the state constitution. The filing seeks compensatory and punitive damages, injunctive and equitable relief, attorney fees, expert fees, and other costs, along with a jury demand.
The coalition states that it represents thousands of business members, including hundreds of small grocery-store owners across the city. Frank Garcia, the organization’s chairman; Kenneth Roldan, its president; and Mark Jaffe, its general counsel, are listed as petitioners in the Article 78 case. Both actions are being handled by the Civil Rights Consortium.
Coalition’s Allegations
The filings do not challenge the broader goal of reducing food costs, explicitly noting that affordable food is a desirable objective. However, the coalition argues that the city should first assess whether subsidized stores would undermine small businesses operating on narrow profit margins after making significant private investments in their communities.
According to the lawsuits, many of the affected businesses are owned by Hispanic, Arab, and Asian New Yorkers. The coalition contends that these owners cannot match prices offered by city-subsidized competitors, which could worsen historical barriers to economic opportunity for minority and immigrant entrepreneurs.
The petition and complaint cite the proposed La Marqueta location as a primary example, alleging that it would directly compete with nearby Hispanic- and Korean-owned supermarkets. The filings also state that the city failed to conduct an analysis similar to the City Environmental Quality Review or evaluate neighborhood food-access data using tools such as the Going to Market study or the FRESH Program’s Supermarket Needs Index.
Furthermore, the coalition points out that the program’s discounted prices would be available without a needs-based eligibility system, allowing higher-income New Yorkers to receive the same taxpayer-subsidized discounts as lower-income residents.
Legal Arguments
In the Article 78 proceeding, the coalition argues that launching and operating the stores without the requested studies would be arbitrary, capricious, made in bad faith, and beyond the city’s municipal authority.
The petition contrasts the proposed public stores with the city’s historical opposition to Walmart locations. It highlights that city officials previously raised concerns about deep-discount competition harming small and minority-owned businesses, asserting that the municipal program’s planned discounts would rival or exceed Walmart-level pricing.
In the class-action complaint, the coalition alleges that private grocers owned predominantly by members of protected groups are being denied equal protection because they cannot offer comparable discounts. The complaint defines a proposed class period from Jan. 1 through Aug. 20, 2026.
The lawsuits contain allegations that have not yet been proved in court. The filings do not include a formal response from Mayor Mamdani or the City of New York, and no court ruling has been issued.