A Washington state court judge on Friday denied a request by the state’s attorney general for a preliminary injunction to block Albertsons’ $4 billion special dividend to shareholders, handing a legal victory to the grocer as it seeks government approval to merge with Kroger.

The judge ruled, however, that a November temporary restraining order halting the dividend will remain in effect until Dec. 19 to give the attorney general time to ask another court to review the decision.

Washington Attorney General Bob Ferguson has appealed the order to the Washington Supreme Court, the state’s highest court, according to a Bloomberg report.

In the order, Judge Ken Schubert noted that Albertsons President and Chief Financial Officer Sharon McCollam began looking for ways to distribute money to shareholders shortly after she joined the company in September 2021, while Kroger did not show interest in acquiring Albertsons until June. The grocers publicly announced plans to combine in October.

While opponents have said the dividend would sap Albertsons’ finances and weaken its ability to compete, Schubert said the companies had demonstrated that Albertsons “would continue to be able to meet all of its capital and operational needs” even after it distributed the funds.

“The State failed to show that Albertsons’s payment of the dividend will impair its ability to compete during regulatory review of the merger or harm competition in grocery retail markets in Washington State communities,” the judge said.

Kroger did make the dividend a condition of the merger, “but merely acquiesced to allow Albertsons to issue a special dividend if Albertsons, unilaterally, decided to do so,” Judge Schubert added. “The State has not established a likelihood that it will be able to prove at trial that Albertsons and Kroger made an agreement in unreasonable restraint of trade or commerce in violation of” Washington state law, according to the ruling.

In addition to the ongoing legal proceedings in the state of Washington, Albertsons is dealing with opposition to the dividend from the attorneys general of California, Illinois and the District of Columbia. In early November, a federal court in Washington, D.C., denied the group’s attempt to get a temporary restraining order, but those attorneys general again asked the judge to temporarily block the payment.

In addition, Colorado’s attorney general filed a brief last week supporting Ferguson’s attempt to stop the payment to shareholders.

In a statement issued after Judge Schubert’s order was released, Albertsons said it believes efforts to stop the dividend are “meritless” and have “no legal basis for preventing the payment of a dividend that has been duly and unanimously approved by Albertsons Cos.’ fully informed Board of Directors.”