WASHINGTON — Whole Foods' decision to buy Wild Oats was sparked by fears that its smaller rival's turnaround plan was finally gaining traction and would soon pose a serious competitive threat, lawyers for the Federal Trade Commission argued in court on Wednesday.

"What (Whole Foods CEO John Mackey) saw was Wild Oats is a stronger business in many respects than it was six and a half years ago," said Michael Bloom, a lawyer for the FTC. Noting that Whole Foods didn't consider buying Wild Oats years ago when it could have cost far less, "it's only when Wild Oats is a competitive threat that its value goes up. It's only when Wild Oats is expanding into Whole Foods' backyard that it's value goes up."

Bloom's arguments came in the final day of a two-day hearing to determine whether a federal court will block Whole Foods' planned $671 million purchase of Boulder-based Wild Oats. U.S. District Judge Paul Friedman is expected to rule by Aug. 15, just weeks before the deal is set to expire at the end of the month.

The FTC has argued that the merger of the nation's two biggest premium organic and natural foods stores would result in higher prices for consumers. Austin-based Whole Foods counter that they're just a fraction of the much larger supermarket industry, and conventional chains like Safeway are increasingly moving into the organic foods market.

Lawyers for Whole Foods and Wild Oats will have three hours to present their closing arguments after lunch.

Friedman said he might have to initially issue the majority of his opinion under seal to protect confidential information concerning Whole Foods, Wild Oats and several supermarket rivals who have been subpoenaed for this case.

During his closing arguments, the FTC's Bloom dismissed Whole Foods' argument that Safeway, SuperValu and other grocery chains are repositioning their stores to go after organic shoppers and foodies willing to pay more for a wider selection and better quality.

Whole Foods carries some 30,000 different types of natural and organic products, Bloom said, while the most ambitious conventional supermarket moving into the same space – whose name wasn't disclosed to the public – hopes to someday carry some 5,000. Trader Joes, which is also often mentioned as a Whole Foods competitor, has an average store size of 11,000 square feet, compared to Whole Foods' 40,000 square feet emporiums.

"These are radically different enterprises," Bloom said.

If the purchase goes through, the only other stores in the country that compete in the same market as Whole Foods are Earth Fare in the Southeast and New Seasons in Oregon, he said.