Ralphs Grocery Co. pleaded not guilty to charges the grocery chain illegally rehired locked-out employees under fake names and Social Security numbers during a months-long labor strike that began in 2003.

Company executives, including Mary Kasper, vice president of legal services at Ralphs, a unit of Cincinnati-based Kroger Co., entered the plea at an arraignment Monday in U.S. District Court in Los Angeles. The case is not expected to go to trial until March 28.

The company is fighting a series of charges stemming from the company's practices during the strike, which lasted four months beginning in October 2003. They include allegations of identity fraud, money laundering and falsifying documents to federal agencies.

Under a secret revenue-sharing arrangement, Ralphs, Pleasanton-based Safeway and Albertson's Inc., which has plans to be bought by Eden Prairie, Minn.-based Supervalu, agreed to lock out employees. Union groups criticized the agreement for violating antitrust laws, prompting a lawsuit by California Attorney General Bill Lockyer that is pending.

About 19,000 employees at Ralphs' 300 Southern California stores eventually were locked out during the strike. In total, the strike involved 65,000 to 70,000 grocery workers.

Federal prosecutors accuse Ralphs of failing to stop managers from hiring locked-out workers to boost profit at struggling stores. The company does admit that 200 of the 50,000 temporary workers were strikers, but blames a few rogue managers for the hires.

The company faces up to $100 million in penalties, as well as back pay to the workers who were not rehired.

For reprint and licensing requests for this article, CLICK HERE.