US retailers Whole Foods Market and Wild Oats Markets head into court today (31 July) to try to push though their proposed merger in the face of fierce opposition from the country’s competition watchdog.

The two companies will start their legal battle against the US Federal Trade Commission (FTC), which wants to block the US$565m merger in the belief the enlarged firm would erode competition in the natural and grocery sectors.

The two sides will meet in court at a preliminary injunction hearing where the presiding judge must decide whether to approve the FTC’s application for an injunction to block the deal

The fight has captured the attention of the world’s press in recent weeks, thanks in part to the revelation that Whole Foods CEO John Mackey criticised Wild Oats under a pseudonym on Internet message boards. Industry watchers have suggested Mackey’s comments could threaten the deal.

The disclosure has sparked a probe from the Securities and Exchange Commission, the US share watchdog, as well as an internal investigation at Whole Foods on Mackey’s conduct.

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Investors in Whole Foods have also called for Mackey to step down from his additional role as chairman.

E-mails written by Mackey to the Whole Foods board about the benefits of the merger with Wild Oats have also come to light. Mackey said the deal was designed to end price wars with Wild Oats and stave off competition from larger retailers in the US.

For their part, Whole Foods and Wild Oats argue that the merger will not affect competition for consumers of natural and organic products. With retail giants like Wal-Mart expanding their organic offerings, Whole Foods and Wild Oats believe their competitive set is wider than argued by the FTC.

The preliminary injunction hearing will conclude tomorrow.