[Federal Register Volume 61, Number 126 (Friday, June 28, 1996)]
[Notices]
[Pages 33765-33774]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-16497]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF JUSTICE
Antitrust Division
United States vs. American Skiing Company and S-K-I Limited;
Proposed Final Judgment and Competitive Impact Statement
Notice is hereby given pursuant to the Antitrust Procedures and
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment,
Stipulation, and Competitive Impact Statement have
[[Page 33766]]
been filed with the United States District Court for the District of
Columbia in United States vs. American Skiing Company and S-K-I
Limited, Civil Action No. 96-1308. The proposed Final Judgment is
subject to approval by the Court after the expiration of the statutory
60-day public comment period and compliance with the Antitrust
Procedures and Penalties Act, 15 U.S.C. 16(b)-(h).
On June 11, 1996, the United States filed a Complaint seeking to
enjoin a transaction in which American Skiing Company (``ASC'') agreed
to acquire S-K-I Limited (``S-K-I''). ASC and S-K-I are the two largest
owner/operators of ski resorts in New England, and this transaction
would have combined eight of the largest ski resorts in this region.
The Complaint alleged that the proposed acquisition would substantially
lessen competition in providing skiing to eastern New England and Maine
skiers in violation of section 7 of the Clayton Act, 15 U.S.C. 18, and
section 1 of the Sherman Antitrust Act, 15 U.S.C. 1.
The proposed Final Judgment orders defendants to sell all of S-K-
I's rights, titles, and interests in the Waterville Valley resort in
Campton, New Hampshire, and all of ASC's rights, titles, and interests
in the Mt. Cranmore resort in North Conway, New Hampshire, to one or
more purchasers who have the capability to compete effectively in the
provision of skiing to eastern New England and Maine skiers at
Waterville Valley and Mt. Cranmore. The Stipulation also imposes a hold
separate agreement that, in essence, requires the parties to ensure
that, until the divestiture mandated by the Final Judgment has been
accomplished, S-K-I's Waterville Valley and ASC's Mt. Cranmore
operations will be held separate and apart from, and operated
independently of, ASC's assets and businesses. A Competitive Impact
Statement filed by the United States describes the Complaint, the
proposed Final Judgment, and remedies available to private litigants.
Public comment is invited within the statutory 60-day comment
period. Such comments, and the responses thereto, will be published in
the Federal Register and filed with the Court. Written comments should
be directed to Craig W. Conrath, Chief, Merger Task Force, Antitrust
Division, 1401 H Street, N.W., Suite 4000, Washington, D.C. 20530
(telephone: 202-307-5779). Copies of the Complaint, proposed Final
Judgment and Competitive Impact Statement are available for inspection
in Room 3233 of the Antitrust Division, Department of Justice, Tenth
Street and Pennsylvania Avenue, N.W., Washington, D.C. 20530
(telephone: 202-633-2481) and at the Office of the Clerk of the United
States District Court for the District of Columbia, Third Street and
Constitution Avenue, N.W., Washington, D.C. 20001.
Copies of any of these materials may be obtained upon request and
payment of a copying fee.
Constance K. Robinson,
Director of Operations, Antitrust Division.
In the matter of: UNITED STATES OF AMERICA, Plaintiff, vs.
AMERICAN SKIING COMPANY, and S-K-I Limited, Defendants.
Docket Number: 96 1308
Judge: Thomas Penfield Jackson.
Filed: June 11, 1996.
Stipulation
It is stipulated by and between the undersigned parties, by their
respective attorneys, as follows:
(1) The Court has jurisdiction over the subject matter of this
action and over each of the parties hereto, and venue of this action is
proper in the District for the District of Columbia.
(2) The parties stipulate that a Final Judgment in the form hereto
attached may be filed and entered by the Court, upon the motion of any
party or upon the Court's own motion, at any time after compliance with
the requirements of the Antitrust Procedures and Penalties Act (15
U.S.C. 16), and without further notice to any party or other
proceedings, provided that plaintiff has not withdrawn its consent,
which it may do at any time before the entry of the proposed Final
Judgment by serving notice thereof on defendants and by filing that
notice with the Court.
(3) The parties shall abide by and comply with the provisions of
the proposed Final Judgment pending entry of the Final Judgment, and
shall, from the date of the filing of this Stipulation, comply with all
the terms and provisions of the proposed Final Judgment as though the
same were in full force and effect as an order of the Court; provided,
however, that S-K-I Limited shall not be obligated to comply with
Sections IV (A) or IX (A) of the Final Judgment unless and until the
closing of any transaction in which American Skiing Company (formerly
LBO Resort Enterprises) directly or indirectly acquires all or any part
of the assets or capital stock of S-K-I Limited; provided, further,
that S-K-I Limited shall not be obligated to comply with Sections IX
(B) through (J) of the Final Judgment in the event that the
Transactions contemplated by the Agreement and Plan of Merger, between
LBO Resort Enterprises Corporation and S-K-I Limited, date February 13,
1996, are terminated.
(4) American Skiing Company shall prepare and deliver reports in
the form required by the provisions of paragraph B of Section VII of
the proposed Final Judgment commencing no later than July 1, 1996, and
every thirty days thereafter pending entry of the Final Judgment.
(5) In the event plaintiff withdraws its consent, as provided in
paragraph 2 above, or if the proposed Final Judgment is not entered
pursuant to this Stipulation, this Stipulation shall be of no effect
whatever, and the making of this Stipulation shall be without prejudice
to any party in this or any other proceeding.
(6) All parties agree that this agreement can be signed in multiple
counter-parts.
Dated: June 11, 1996.
For Plaintiff United States of America:
Craig W. Conrath,
U.S. Department of Justice, Antitrust Division, Merger Task Force, 1401
H Street, N.W.; Suite 4000, Washington, D.C. 20005, (202) 307-5779.
For Defendant American Skiing Company:
Jeffrey M. White,
Pierce, Atwood, Scribner, Allen, Smith & Lancaster, One Monument
Square, Portland, Maine 04101-1110, (207) 773-6411, Attorney for
American Skiing Co.
For Defendant S-K-I Limited
Paul D. Sanson,
Shipman & Goodwin, One American Row, Hartford, CT 06103-2819, (860)
251-5721, Attorney for S-K-I Limited.
Dated: June 10, 1996.
For Plaintiff United States of America:
Craig W. Conrath,
U.S. Department of Justice, Antitrust Division, Merger Task Force, 1401
H Street, N.W.; Suite 4000, Washington, D.C. 20005, (202) 307-5779.
For Defendant American Skiing Company:
Jeffrey M. White,
Pierce, Atwood, Scribner, Allen, Smith & Lancaster, One Monument
Square, Portland, Maine (207) 773-6411, Attorney for American Skiing
Co.
For Defendant S-K-I Limited:
Paul D. Sanson,
Shipman & Goodwin, One American Row, Hartford, CT 06103-2819, (860)
251-5721, Attorney for S-K-I Limited.
Dated: June 11, 1996.
[[Page 33767]]
For Plaintiff United States of America:
Craig W. Conrath,
Antitrust Division, Merger Task Force, 1401 H Street, N.W.; Suite 4000,
Washington, D.C. 20005, (202) 307-5779.
For Defendant American Skiing Company:
Jeffrey M. White,
Pierce, Atwood, Scribner, Allen, Smith & Lancaster, One Monument
Square, Portland, Maine 04101-1110, (207) 773-6411, Attorneys for
American Skiing Co.
For Defendant S-K-I Limited:
Paul D. Sanson,
Shipman & Goodwin, One American Row, Hartford, CT 06103-2819, (860)
251-5721, Attorney for S-K-I Limited.
In the matter of: UNITED STATES OF AMERICA, Plaintiff, v.
AMERICAN SKIING COMPANY, and S-K-I LIMITED, Defendants.
Civil No.: 96 1308. Filed 6/11/96. Judge Thomas Penfield
Jackson.
Final Judgment
Whereas, plaintiff, United States of America, having filed its
Complaint herein on June , 1996, and plaintiff and defendants, by their
respective attorneys, having consented to the entry of this Final
Judgment without trial or adjudication of any issue of fact or law
herein, and without this Final Judgment constituting any evidence
against or an admission by any party with respect to any issue of law
or fact herein;
And whereas, defendants have agreed to be bound by the provisions
of this Final Judgment pending its approval by the Court;
And whereas, the essence of this Final Judgment is prompt and
certain divestiture of assets to assure that competition is not
substantially lessened;
And whereas, plaintiff requires defendants to make certain
divestitures for the purpose of remedying the loss of competition
alleged in the Complaint;
And whereas, defendants have represented to plaintiff that the
divestitures ordered herein can and will be made and that defendants
will later raise no claims of hardship or difficulty as grounds for
asking the Court to modify any of the divestiture provisions contained
below;
Now, therefore, before the taking of any testimony, and without
trial or adjudication of any issue of fact or law herein, and upon
consent of the parties hereto, it is hereby ordered, adjudged, and
decreed as follows:
I. Jurisdiction
This Court has jurisdiction over each of the parties hereto and the
subject matter of this action. The Complaint states a claim upon which
relief may be granted against defendant under Section 7 of the Clayton
Act, as amended (15 U.S.C. Sec. 18).
II. Definitions
As used in this Final Judgment:
A. ``ASC'' means defendant American Skiing Company (formerly known
as LBO Resort Enterprises Corporation), a Maine corporation
headquartered in Newry, Maine, and includes its successors and assigns,
and its subsidiaries, directors, officers, managers, agents, and
employees acting for or on behalf of any of them.
B. ``S-K-I'' means defendant S-K-I Limited, a Delaware corporation
headquartered in West Lebanon, New Hampshire, and includes its
successors and assigns, and its subsidiaries, directors, officers,
managers, agents, and employees acting for or on behalf of any of them.
C. ``Divestiture Assets'' means:
(1) all rights, titles and interests, including all fee and all
leasehold and renewal rights, in S-K-I's Waterville Valley resort in
Campton, New Hampshire, including, but not limited to, all real
property (including but not limited to property owned in fee or through
a lease or special use permit from the United States Forest Service),
deeded development rights to real property, capital equipment
(including but not limited to lifts and snowmaking equipment),
buildings, fixtures, inventories, contracts (including but not limited
to customer contracts), customer lists, marketing or consumer surveys
relating to Waterville Valley, permits (including but not limited to
environmental permits and all permits from the United States Forest
Service), all work in progress on permits or studies undertaken in
order to obtain permits, plans for design or redesign of ski trails,
trucks and other vehicles, interests, assets or improvements related to
the provision of skiing services to customers at the Waterville Valley
resort (collectively ``Waterville Valley''); and
(2) all rights, titles and interests, including all fee and all
leasehold and renewal rights, in ASC's Mt. Cranmore resort in North
Conway, New Hampshire, including, but not limited to, all real property
(including but not limited to property owned in fee or through a lease
or special use permit from the United States Forest Service), deeded
development rights to real property, capital equipment (including, but
not limited to, lifts and snowmaking equipment), buildings, fixtures,
inventories, contracts (including, but not limited to, customer
contracts), customer lists, marketing or consumer surveys relating to
Mt. Cranmore, permits (including, but not limited to, environmental
permits and all permits from the National Forest Service), all work in
progress on permits or studies undertaken in order to obtain permits,
plans for design or redesign of ski trails, trucks and other vehicles,
interests, assets or improvements related to the provision of skiing
services to customers at the Mt. Cranmore resort; (collectively ``Mt.
Cranmore''); provided, however that Mt. Cranmore shall not include the
81.9 acres of real estate identified in the subdivision application
filed by Mt. Cranmore, Inc. with the town of North Conway, New
Hampshire, unless plaintiff, in its sole discretion, determines that
such 81.9 acres must be divested for the purchaser of Mt. Cranmore to
satisfy the criteria set forth in Section IV (G) of the Final Judgment.
D. ``Skiing services'' means all services related to providing
access to downhill skiing and snowboarding, including, but not limited
to, providing lifts, skiing lessons, ski patrol, snowmaking, design,
building, and grooming of trails, and ancillary services such as food
service, entertainment, and lodging.
III. Applicability
A. The provisions of this Final Judgment apply to defendants, their
successors and assigns, subsidiaries, directors, officers, managers,
agents, and employees, and all other persons in active concert or
participation with any of them who shall have received actual notice of
this Final Judgment by personal service or otherwise.
B. Defendants shall require, as a condition of the sale or other
disposition of all or substantially all of the Divestiture Assets, that
the purchaser or purchasers agree to be bound by the provisions of this
Final Judgment.
IV. Divestitures
A. Defendants are hereby ordered and directed, in accordance with
the terms of this Final Judgment, within one hundred and eighty (180)
calendar days after the filing of this Final Judgment, to divest the
Divestiture Assets to a purchaser or purchasers.
B. Divestiture of defendants' leasehold interests, if any, in the
Divestiture Assets shall be by transfer of the entire leasehold
interest, which shall be for the entire remaining term of such
leasehold, including any renewal rights.
C. Defendants agree to use their best efforts to accomplish the
divestitures as expeditiously and timely as possible. Plaintiff, in its
sole discretion, may extend the time period for any divestiture for two
additional periods of
[[Page 33768]]
time not to exceed ninety (90) calendar days in toto.
D. In accomplishing the divestitures ordered by this Final
Judgment, defendants promptly shall make known, by usual and customary
means, the availability of the Divestiture Assets. Defendant shall
inform any person making an inquiry regarding a possible purchase that
the sale is being made pursuant to this Final Judgment and provide such
person with a copy of this Final Judgment. Defendants shall make known
to any person making an inquiry regarding a possible purchase of the
Divestiture Assets that the assets described in Section II (C) are
being offered for sale and that Waterville Valley and Mt. Cranmore may
be purchased as a two resort package or sold separately to different
purchasers. Defendants shall also offer to furnish to all bona fide
prospective purchasers, subject to customary confidentiality
assurances, all information regarding the Divestiture Assets
customarily provided in a due diligence process except such information
subject to attorney-client privilege or attorney work-product
privilege. Defendants shall make available such information to
plaintiff at the same time that such information is made available to
any other person.
E. Defendants shall not interfere with any negotiations by any
purchaser or purchasers to employ any employee of the defendants who
works at Waterville Valley or Mt. Cranmore, or whose employment
substantially relates to the provision of skiing services at Waterville
Valley or Mt. Cranmore, or whose responsibilities include the
management of or marketing for Waterville Valley or Mt. Cranmore.
F. Defendants shall permit prospective purchasers of the
Divestiture Assets to have access to personnel and to make such
inspection of the Divestiture Assets, and any and all financial,
operational, or other documents and information customarily provided as
part of a due diligence process.
G. Unless plaintiff otherwise consents in writing, the divestiture
pursuant to Section IV (A), or by the trustee appointed pursuant to
Section V of this Final Judgment, shall include all of the Divestiture
Assets and be accomplished by selling or otherwise conveying the assets
described in Section II (B) to one or two purchasers (or, as provided
in Section IV (H) with respect to Mt. Cranmore, several purchasers), in
such a way as to satisfy plaintiff, in its sole discretion, that the
Divestiture Assets can and will be used by the purchaser or purchasers
as part of a viable, ongoing business or businesses engaged in the
provision of skiing services at Waterville Valley and Mt. Cranmore. The
divestiture, whether pursuant to Section IV or Section V of this Final
Judgment, shall be made to a purchaser or purchasers for whom it is
demonstrated to plaintiff's sole satisfaction that: (1) the purchaser
or purchasers have the capability and intent of competing effectively
in the provision of skiing services at Waterville Valley and Mt.
Cranmore; (2) the purchaser or purchasers have or soon will have the
managerial, operational, and financial capability to compete
effectively in the provision of skiing services at Waterville Valley
and Mt. Cranmore; and (3) none of the terms of any agreement between
the purchaser or purchasers and defendants give defendants the ability
unreasonably to raise the purchaser's or purchasers' costs, to lower
the purchaser's or purchasers' efficiency, or otherwise to interfere in
the ability of the purchaser and purchasers to compete effectively in
the provision of skiing services at Waterville Valley and Mt. Cranmore.
H. Defendants may divest the Mt. Cranmore sports center, the Mt.
Cranmore tennis stadium and the development rights to land owned by the
Nature Conservancy (which land is adjacent to Mt. Cranmore) to separate
purchasers, provided that plaintiff, in its sole discretion, first
determines that the purchaser of the remaining assets of Mt. Cranmore
satisfies the criteria set forth in Section IV(G) of the Final
Judgment.
V. Appointment of Trustee
A. In the event that defendants have not divested the Divestiture
Assets within the time specified in Sections IV (A) or (C) of this
Final Judgment, the Court shall appoint, on application of the United
States, a trustee selected by the United States to effect the
divestiture of the Divestiture Assets.
B. After the appointment of a trustee becomes effective, only the
trustee shall have the right to sell the Divestiture Assets. The
trustee shall have the power and authority to accomplish the
divestiture at the best price then obtainable upon a reasonable effort
by the trustee, subject to the provisions of Sections V and VI of this
Final Judgment, and shall have such other powers as the Court shall
deem appropriate. Subject to Section V(C) of this Final Judgment, the
trustee shall have the power and authority to hire at the cost and
expense of defendants any investment bankers, attorneys, or other
agents reasonably necessary in the judgment of the trustee to assist in
the divestiture, and such professionals and agents shall be accountable
solely to the trustee. The trustee shall have the power and authority
to accomplish the divestiture at the earliest possible time to a
purchaser or purchasers acceptable to plaintiff, and shall have such
other powers as this Court shall deem appropriate. Defendants shall not
object to a sale by the trustee on any grounds other than the trustee's
malfeasance. Any such objections by defendant must be conveyed in
writing to plaintiff and the trustee within ten (10) calendar days
after the trustee has provided the notice required under Section VI of
this Final Judgment.
C. The trustee shall serve at the cost and expense of defendants,
on such terms and conditions as the Court may prescribe, and shall
account for all monies derived from the sale of the assets sold by the
trustee and all costs and expenses so incurred. After approval by the
Court of the trustee's accounting, including fees for its services and
those of any professionals and agents retained by the trustee, all
remaining money shall be paid to ASC and the trust shall then be
terminated. The compensation of such trustee and of any professionals
and agents retained by the trustee shall be reasonable in light of the
value of the Divestiture Assets and based on a fee arrangement
providing the trustee with an incentive based on the price and terms of
the divestiture and the speed with which it is accomplished.
D. Defendants shall use their best efforts to assist the trustee in
accomplishing the required divestiture. The trustee and any
consultants, accountants, attorneys, and other persons retained by the
trustee shall have full and complete access to the personnel, books,
records, and facilities of defendants, and defendants shall develop
financial or other information relevant to such assets as the trustee
may reasonably request, subject to reasonable protection for trade
secret or other confidential research, development, or commercial
information. Defendants shall take no action to interfere with or to
impede the trustee's accomplishment of the divestiture.
E. After its appointment, the trustee shall file monthly reports
with the parties and the Court setting forth the trustee's efforts to
accomplish the divestiture ordered under this Final Judgment. If the
trustee has not accomplished such divestiture within six (6) months
after its appointment, the trustee thereupon shall file promptly with
the Court a report setting forth (1) the trustee's efforts to
accomplish the required divestiture, (2) the reasons, in
[[Page 33769]]
the trustee's judgment, that the required divestiture has not been
accomplished, and (3) the trustee's recommendations; provided, however,
that to the extent such reports contain information that the trustee
deems confidential, such reports shall not be filed in the public
docket of the Court. The trustee shall at the same time furnish such
report to the parties, who shall each have the right to be heard and to
make additional recommendations consistent with the purpose of the
trust. The Court shall enter thereafter such orders as it shall deem
appropriate in order to carry out the purpose of the trust, which may,
if necessary, include extending the trust and the term of the trustee's
appointment by a period requested by the United States.
VI. Notification
Within two (2) business days following execution of a definitive
agreement, contingent upon compliance with the terms of this Final
Judgment, to effect, in whole or in part, any proposed divestiture
pursuant to Sections IV or V of this Final Judgment, defendants or the
trustee, whichever is then responsible for effecting the divestiture,
shall notify plaintiff of the proposed divestiture. If the trustee is
responsible, it shall similarly notify defendants. The notice shall set
forth the details of the proposed transaction and list the name,
address, and telephone number of each person not previously identified
who offered to, or expressed an interest in or a desire to, acquire any
ownership interest in the assets that are the subject of the binding
contract, together with full details of same. Within fifteen (15)
calendar days of receipt by plaintiff of such notice, plaintiff may
request from defendants, the proposed purchaser or purchasers, any
other third party, or the trustee if applicable additional information
concerning the proposed divestiture and the proposed purchaser or
purchasers. Defendants and the trustee shall furnish any additional
information requested within fifteen (15) calendar days of the receipt
of the request, unless the parties shall otherwise agree. Within thirty
(30) calendar days after receipt of the notice or within twenty (20)
calendar days after plaintiff has been provided the additional
information requested from defendants, the proposed purchaser or
purchasers, any third party, and the trustee, whichever is later,
plaintiff shall provide written notice to defendants and the trustee,
if there is one, stating whether or not it objects to the proposed
divestiture. If plaintiff provides written notice to defendants and the
trustee that it does not object, then the divestiture may be
consummated, subject only to defendants' limited right to object to the
sale under Section V(B) of this Final Judgment. Absent written notice
that plaintiff does not object to the proposed purchaser or upon
objection by plaintiff, a divestiture proposed under Section IV shall
not be consummated. Upon objection by plaintiff, or by defendants under
the proviso in Section V(B), a divestiture proposed under Section V
shall not be consummated unless approved by the Court.
VII. Affidavits
A. Within twenty (20) calendar days of the filing of this Final
Judgment and every thirty (30) calendar days therafter until the
divestitures have been completed whether pursuant to Section IV or
Section V of this Final Judgment, ASC shall deliver to plaintiff an
affidavit as to the fact and manner of defendants' compliance with
Sections IV or V of this Final Judgment. Each such affidavit shall
include, inter alia, the name, address, and telephone number of each
person who, at any time after the period covered by the last such
report, made an offer to acquire, expressed an interest in acquiring,
entered into negotiations to acquire, or was contacted or made an
inquiry about acquiring, any interest in the Divestiture Assets, and
shall describe in detail each contact with any such person during that
period.
B. Within twenty (20) calendar days of the filing of this Final
Judgment, ASC shall deliver to plaintiff an affidavit which describes
in detail all actions defendants have taken and all steps defendants
have implemented on an on-going basis to preserve the Divestiture
Assets pursuant to Section IX of this Final Judgment and describes the
functions, duties and actions taken by or undertaken at the supervision
of the individual(s) described at Section IX(F) of this Final Judgment
with respect to defendants' efforts to preserve the Divestiture Assets.
The affidavit also shall describe, but not be limited to, defendants'
efforts to maintain and operate Waterville Valley and Mt. Cranmore as
active competitors, maintain the management, sales, marketing and
pricing of Waterville Valley and of Mt. Cranmore apart from that of
defendants' other businesses that provide skiing services, maintain and
increase sales of skiing services at Waterville Valley and at Mt.
Cranmore, and maintain the Divestiture Assets in operable condition,
continuing normal maintenance. ASC shall deliver to plaintiff an
affidavit describing any changes to the efforts and actions outlined in
defendants' earlier affidavit(s) filed pursuant to this Section within
fifteen (15) calendar days after the change is implemented.
C. Defendants shall preserve all records of all efforts made to
preserve and divest the Divestiture Assets.
VIII. Financing
With prior written consent of the plaintiff, defendants may finance
all or any part of any purchase made pursuant to Sections IV or V of
this Final Judgment.
IX. Preservation of Assets
Until the divestitures required by the Final Judgment have been
accomplished:
A. Defendants shall take all steps necessary to ensure that the
Divestiture Assets will be maintained and operated as independent,
ongoing, economically viable and active competitors in the provision of
skiing services; and that, except as necessary to comply with Sections
IX(B) to IX(F) of this Final Judgment, the management of the
Divestiture Assets shall be kept separate and apart from the management
of defendants' other ski resorts and will not be influenced by
defendants and the books, records, and competitively sensitive sales,
marketing and pricing information associated with the Divestiture
Assets will be kept separate and apart from that of defendants; other
businesses that provide skiing services.
B. Defendants shall use all reasonable efforts to maintain and
increase sales of skiing services a Waterville Valley and at Mt.
Cranmore, and defendants shall maintain at 1995 or previously approved
levels, whichever are higher, promotional, advertising, sales,
marketing and merchandising support for skiing services sold at
Waterville Valley and at Mt. Cranmore. Defendants' sales and marketing
employees responsible for sales of skiing services at Waterville Valley
and at Mt. Cranmore shall not be transferred or reassigned to other ski
resorts owned by defendant.
C. Defendants shall take all steps necessary to ensure that the
Divestiture Assets are fully maintained in operable condition and shall
maintain and adhere to normal maintenance schedules for the Divestiture
Assets.
D. Defendants shall continue all efforts in progress to obtain
permits for either Waterville Valley or Mt. Cranmore, including, but
not limited to, efforts to obtain permits that will allow the building
of ponds for the storage of water for snowmaking, provided that
defendants will not be required to add any of the permitted ponds.
E. Defendants shall provide and maintain sufficient lines of
sources of
[[Page 33770]]
credit to maintain the Divestiture Assets as viable, ongoing
businesses.
F. Defendants shall provide and maintain sufficient working capital
to maintain the Divestiture Assets as viable ongoing businesses.
G. Defendants shall not, except as part of a divestiture approved
by plaintiff, remove, sell, or transfer any of the Divestiture Assets,
other than sales in the ordinary course of business.
H. Unless they have obtained the prior approval of the United
States, defendants shall refrain from terminating or reducing any
current employment, salary, or benefit agreements for any personnel
employed by defendants who works at Waterville Valley or Mt. Cranmore,
except in the ordinary course of business.
I. Defendants shall take no action that would jeopardize their
ability to divest the Divestiture Assets as viable, ongoing businesses.
J. Defendants shall appoint a person or persons to oversee the
Divestiture Assets, and who will be responsible for defendant's
compliance with Section IX of this Final Judgment.
X. Compliance Inspection
Only for the purposes of determining or securing compliance with
the Final Judgment and subject to any legally recognized privilege,
from time to time:
A. Duly authorized representatives of the United States Department
of Justice, upon written request of the Attorney General or of the
Assistant Attorney General in charge of the Antitrust Division, and on
reasonable notice to defendants made to their principal offices, shall
be permitted:
(1) Access during office hours of defendants to inspect and copy
all books, ledgers, accounts, correspondence, memoranda, and other
records and documents in the possession or under the control of
defendant, who may have counsel present, relating to enforcement of
this Final Judgment; and
(2) Subject to the reasonable convenience of defendants and without
restraint or interference from it, to interview its officers,
employees, and agents, who may have counsel present, regarding any such
matters.
B. Upon the written request of the Attorney General or of the
Assistant Attorney General in charge of the Antitrust Division, made to
defendants' principal offices, defendants shall submit such written
reports, under oath if requested, with respect to enforcement of this
Final Judgment.
C. No information or documents obtained by the means provided in
Section X of this Final Judgment shall be divulged by a representative
of plaintiff to any person other than a duly authorized representative
of the Executive Branch of the United States, except in the course of
legal proceedings to which the United States is a party (including
grand jury proceedings), or for the purpose of securing compliance with
the Final Judgment, or as otherwise required by law.
D. If at the time information or documents are furnished by
defendants to plaintiff, defendants represent and identify in writing
the material in any such information or documents to which a claim of
protection may be asserted under Rule 26(c)(7) of the Federal Rules of
Civil Procedure, and defendants mark each pertinent page of such
material, ``Subject to claim of protection under Rule 26(c)(7) of the
Federal Rules of Civil Procedure,'' then ten (10) calendar days notice
shall be given by plaintiff to defendants prior to divulging such
material in any legal proceeding (other than a grand jury proceeding).
XI. Retention of Jurisdiction
Jurisdiction is retained by this Court for the purpose of enabling
any of the parties to this Final Judgment to apply to this Court at any
time for such further orders and directions as may be necessary or
appropriate for the construction or carrying out of this Final
Judgment, for the modification of any of the provisions hereof, for the
enforcement of compliance herewith, and for the punishment of any
violations hereof.
XII. Termination
Unless this Court grants an extension, this Final Judgment will
expire on the tenth anniversary of the date of its entry.
XIII. Public Interest
Entry of this Final Judgment is in the public interest.
Dated:-----------------------------------------------------------------
----------------------------------------------------------------------
United States District Judge
UNITED STATES OF AMERICA, PLAINTIFF, versus AMERICAN SKIING
COMPANY, and S-K-I LIMITED, Defendants.
Civil Action No.: 96-01308TPJ.
Filed: June 18, 1996.
Competitive Impact Statement
The United States, pursuant to section 2(b) of the Antitrust
Procedures and Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files
this Competitive Impact Statement relating to the proposed Final
Judgment submitted for entry in this civil antitrust proceeding.
I. Nature and Purpose of the Proceeding
The United States filed a civil antitrust Complaint on June 11,
1996, alleging that American Skiing Company's (``ASC'') proposed
acquisition of the ski resorts of S-K-I Limited (``S-K-I'') would
violate section 7 of the Clayton Act, 15 U.S.C. Sec. 18. The Complaint
alleges that ASC and S-K-I are the two largest owner/operators of ski
resorts in New England, and that this transaction would combine eight
of the largest ski resorts in this region. In particular, this
acquisition would increase substantially the concentration among ski
resorts to which eastern New England residents (i.e., those in Maine,
eastern Massachusetts and Connecticut, and Rhode Island) practicably
can go for weekend ski trips, and to which Maine residents practicably
can go for day ski trips. As a result, this acquisition threatens to
raise the price of, or reduce discounts for, weekend and day skiing to
consumers living in these areas in violation of section 7 of the
Clayton Act. The prayer for relief in the Complaint seeks: (1) a
judgment that the proposed acquisition would violate section 7 of the
Clayton Act, 15 U.S.C. 18; and (2) a permanent injunction preventing
ASC from acquiring control of S-K-I's ski resorts, or otherwise
combining such businesses with ASC's own business in the United States.
At the same time the Complaint was filed, the United States also
filed a proposed settlement that would permit ASC to complete its
acquisition of S-K-I's ski resorts, but require certain divestitures
that would preserve competition for skiers in eastern New England and
Maine. This settlement consists of a Stipulation and a proposed Final
Judgment.
The proposed Final Judgment orders the parties to sell all of S-K-
I's rights, titles, and interests in the Waterville Valley resort in
Campton, New Hampshire, and all of ASC's rights, titles, and interests
in the Mt. Cranmore resort in North Conway, New Hampshire, to one or
more purchasers who have the capability to compete effectively in the
provision of skiing for skiers in eastern New England and Maine at
Waterville Valley and Mt. Cranmore. The parties must complete the
divestiture of these ski resorts and related assets within one hundred
and eighty (180) calendar days after the filing of the proposed Final
Judgment in accordance with the procedures specified therein.
The Stipulation and proposed Final Judgment also impose a hold
separate agreement that requires defendants to ensure that, until the
divestiture
[[Page 33771]]
mandated by the Final Judgment has been accomplished, S-K-I's
Waterville Valley and ASC's Mt. Cranmore operations will be held
separate and apart from, and operated independently of, defendants'
other assets and businesses. Defendants must preserve and maintain the
ski resorts to be divested as saleable and economically viable, ongoing
concerns, with competitively sensitive business information and
decisionmaking divorced from that of defendants' ski resorts.
Defendants will appoint a person or persons to monitor and ensure their
compliance with these requirements of the proposed Final Judgment.
The United States, ASC, and S-K-I have stipulated that the proposed
Final Judgment may be entered after compliance with the APPA. Entry of
the proposed Final Judgment may be entered after compliance with the
APPA. Entry of the proposed Final Judgment would terminate this action,
except that the Court would retain jurisdiction to construe, modify, or
enforce the provisions of the proposed Final Judgment and to punish
violations thereof.
II. Description of the Events Giving Rise to the Alleged Violation
A. The Parties and the Proposed Transaction
ASC, A Maine corporation headquartered in Newry, Maine, owns four
ski resorts: Sunday River in Main, Attitash/Bear Peak and Mt. Cranmore
in New Hampshire, and Sugarbush in Vermont. During the 1994-95 ski
season, ASC resorts accounted for 1.1 million skier days. ASC had
revenues of over $58 million in 1995.
S-K-I, a Delaware corporation headquartered in West Lebanon, New
Hampshire, also owns four ski resorts: Killington and Mt. Snow/Haystack
in Vermont, Waterville Valley in New Hampshire, and a 51 percent
interest in Sugarloaf in Maine. During the 1994-95 ski season, S-K-I
resorts accounted for 1.8 million skier days. S-K-I had revenues of
more than $109 million in 1995.
On February 13, 1996, ASC agreed to acquire all the common stock of
S-K-I for approximately $137 million, which includes the assumption of
certain liabilities. Pursuant to the purchase agreement, ASC would
acquire all of the ski resort services and operations of S-K-I and its
subsidiaries as well as its 51 percent interest in Sugarloaf. This
proposed transaction combining the two largest owner/operators of ski
resorts in New England precipitated the government's suit.
B. The Skiing Market
The Complaint alleges that the provision of weekend and day skiing
constitutes a line of commerce, or relevant product market, for
antitrust purpose, and that eastern New England and Maine constitute
relevant geographic markets. Within eastern New England and Maine, the
Complaint alleges the effect of ACS's acquisition would be to lessen
competition substantially in the provision of skiing.
The business of skiing comprises all services related to providing
access to downhill skiing and snowboarding, including, but not limited
to, providing lifts, ski patrol, snowmaking, design, building, and
grooming of trails, skiing lessons, and ancillary services such as food
service, entertainment, and lodging.
Most skiers must travel some distance from their homes to ski.
Consequently, depending on, among other things, the duration of a given
ski trip, the number of resorts practicably available to a skier will
vary according to the time and expense required to travel to, and the
qualitative aspects of, the possible alternatives.
The duration of a ski trip and the distance traveled by the skier
can be identified easily by ski resorts. As a consequence, ski resorts
can and do offer different prices to skiers depending on where they
come from and how long they plan to stay at the resort. For example,
consecutive-day passes can be offered at discount off the single day
ticket to attract weekend skiers. Discounts can be given to a skier who
presents a drives license from a more distant state without the same
discounts being offered to local residents, who may have fewer choices.
Also, coupons can be put in local papers or sent out by direct mail,
targeted to skiers in particular geographic areas. Promotions can be
targeted to skiers in defined locations without significant risk that
skiers in other locations will be able to learn about and take
advantage of the lower price being offered to others. In addition, ski
resorts routinely offer discounts on lift ticket prices when tickets
are packaged with lodging, either by offering such ``ski and stay''
packages directly to skiers or by selling discounted lift tickets to
the owner of a hotel or inn, who in turn sells a package to skiers. As
a result, ski resorts can and do routinely charge different prices for
skiing depending on the length of stay and the residence of the skier.
Downhill skiing differs from other winter recreational activities, such
as cross-country skiing, ice skating, snow-mobiling, sleigh rides,
tobagganing, ice fishing,and taking cruises to places with hot
climates. small but significant and nontransitory increase in prices
for skiing would not cause a significant number of downhill skiers to
substitute other winter recreational activities for skiing.
Moreover, geographic markets for skiing are regional. Skiers are
not willing to travel an unlimited distance to ski. Traveling to
distant ski resorts imposes a burden on the skier, either in the form
of excessive driving time or of a large additional expense for airfare.
However, the longer the ski trip, the greater a skier's willingness to
travel. Thus, distance a skier will travel to a ski resort depends in
part on the length of time that skier will stay at the resort and on
the qualitative characteristics of the resort.
C. Competition Between ASC and S-K-I
ASC and S-K-I compete directly to provide skiing to both eastern
New England weekend skiers and Maine day skiers.
Eastern New England Weekend Skiers
ASC and S-K-I both provide skiing to eastern New England weekend
skiers at each of their ski resorts. Eastern New England residents can
practicably turn only to a limited number of resorts with adequate
services (e.g., accommodations, number and variety of trails, and other
amenities) in Maine, New Hampshire, and Vermont for weekend skiing
trips. These are the resorts that have the necessary qualities and are
within a reasonable traveling distance for eastern New England weekend
skiers.
Smaller ski resorts and resorts located farther away cannot and
after this transaction would not constrain prices charged to weekend
skiers living in eastern New England. Although eastern New England
skiers occasionally choose to ski at such smaller or more distance
resorts, skiing at such resorts is not a practical or economic
alternative for most eastern New England weekend skiers most of the
time.
Ski resorts in Maine, New Hampshire, and Vermont that have the
necessary qualities and services to attract weekend skiers from eastern
New England can charge different prices to these skiers than they
charge to others. Eastern New England weekend skiers can be identified
easily by the ski resorts that are reasonable alternatives for these
consumers. These ski resorts can charge eastern New England weekend
skiers prices that differ from prices charged to
[[Page 33772]]
day skiing customers, to customers coming from other parts of the
country, or to customers who stay longer than a weekend. Ski resorts
can offer coupons for discounted lift tickets packaged with lodging
and/or airfare, either through direct mail or through advertising in
local papers, in, for example, the New York, Washington D.C., or
Atlanta metropolitan areas, and not offer such coupons in eastern New
England. A single firm controlling all the resorts in Maine, New
Hampshire, and Vermont with adequate services for weekend skiing would
be able to raise prices a small but significant amount to eastern New
England weekend skiers without losing so much business as to make the
price increase unprofitable.
Thus, the provision of weekend skiing to eastern New England
residents is a relevant market (i.e., a line of commerce and a section
of the country) within the meaning of Section 7 of the Clayton Act, and
ASC and S-K-I compete directly in this market.
Maine Day Skiers
ASC provides skiing to Maine day skiers primarily at its Sunday
River, Attitash/Bear Peak, and Mt. Cranmore ski resorts. S-K-I provide
skiing to Maine day skiers primarily at its Sugarloaf and Waterville
Valley ski resorts. Maine residents can practicably turn only to
resorts in Maine and eastern New Hampshire for day skiing trips. These
are the resorts that are within a reasonable traveling distance for
Maine day skiers.
Ski resorts located father from Maine cannot and after this
transaction would not constrain prices charged to day skiers living in
Maine. Although Maine skiers occasionally choose to ski at such more
distant resorts, skiing at such resorts is not a practical or economic
alternative for most Maine day skiers most of the time.
Ski resorts in Maine and eastern New Hampshire can charge prices to
Maine day skiers different from prices they charge to other skiers.
Maine day skiers can be identified easily by the ski resorts that are
reasonable alternatives for these consumers. These ski resorts can
charge Maine day skiers prices that differ from prices charged to out-
of-state skiers or to Maine skiers who stay multiple days. A single
firm controlling all the ski resorts in Maine and eastern New Hampshire
would be able to raise prices a small but significant amount to Maine
day skiers without losing so much business as to make the price
increase unprofitable.
Thus, the provision of day skiing to Maine residents is a relevant
market (i.e., a line of commerce and a section of the country) within
the meaning of section 7 of the Clayton Act, and ASC and S-K-I compete
directly in this market.
D. Anticompetitive Consequences of the Acquisition
The Complaint alleges that the acquisition of S-K-I by ASC would
substantially lessen competition. The transaction would have the
following effects, among others:
1. Competition generally in providing skiing to eastern New
England weekend skiers would be lessened substantially;
2. Actual competition between ASC and S-K-I in providing skiing
to eastern New England weekend skiers would be eliminated;
3. Discounting to eastern New England weekend skiers by ASC and
S-K-I resorts would likely be reduced or eliminated;
4. Prices for skiing to eastern New England weekend skiers would
be likely to increase;
5. Competition generally in providing skiing to Maine day skiers
would be lessened substantially;
6. Actual competition between ASC and S-K-I in providing skiing
to Maine day skiers would be eliminated;
7. Discounting to Maine day skiers by ASC and S-K-I resorts
would likely be reduced or eliminated; and,
8. Prices for skiing to Maine day skiers would be likely to
increase.
Moreover, the Complaint alleges that the combination of ASC and S-
K-I would substantially increase concentration in the eastern New
England weekend skier market and Maine day skier market using the
Herfindahl-Hirschman Index (``HHI'') (explained in Appendix A to the
Complaint) as a measure of market concentration. The approximate post-
merger HHI for eastern New England weekend skiing, based on the 1994-95
total skier days of ski resorts located in Maine, New Hampshire, and
Vermont capable of attracting and accommodating weekend skiers, would
be approximately 2100 with a change in HHI of about 900 points. The
approximate post-merger HHI for Maine day skiing, based on the 1994-95
total skier days of ski resorts located in Maine and eastern New
Hampshire, would be over 2900 with a change in HHI of over 1200 points.
Finally, the Complaint alleges that successful entry or expansion
in the skiing business would be difficult, time consuming, and costly,
as well as extremely unlikely. Entry or expansion therefore would not
be timely, likely, or sufficient to prevent any harm to competition.
III. Explanation of the Proposed Final Judgment
The proposed Final Judgment would preserve competition for skiers
in the operation of ski resorts in eastern New England and Maine.
Within one hundred and eighty (180) calendar days after filing the
proposed Final Judgment, defendants must sell all of S-K-I's rights,
titles, and interests in the Waterville Valley resort in Campton, New
Hampshire, and all of ASC's rights, titles, and interests in the Mt.
Cranmore resort in North Conway, New Hampshire, to one or more
purchasers. The assets and interests will be sold to one or more
purchasers who demonstrate to the sole satisfaction of the United
States that they will be an economically viable and effective
competitor, capable of maintaining or surpassing ASC's and S-K-I's pre-
acquisition market performance in the operation of ski resorts in the
New England region.
The divestitures ordered in the proposed Final Judgment will
resolve the anticompetitive problems raised by the proposed
transaction. With these divestitures, the post-merger HHI for the
eastern New England weekend skiing market will be below 1800, and the
parties' post-merger share of that market will be less than 40 percent.
The post-merger HHI for the Maine day skiing market will be slightly
over 1900 with these divestitures, and the parties' post-merger share
of that market will be less than 35 percent. Given these post-
divestiture HHI levels, the combined firm's post-divestiture market
shares, and the number and size of independent ski resorts remaining in
the affected markets, the proposed transaction is not likely to lead to
a unilateral anticompetitive effect or to a higher probability of
coordinative behavior, provided the divestitures are made.
Until the ordered divestitures take place, defendants must take all
reasonable steps necessary to accomplish the divestitures, and
cooperate with any prospective purchaser. If defendants do not
accomplish the ordered divestiture within the specified one hundred and
eighty (180) calendar day time period, which may be extended up to
ninety (90) calendar days by the United States, the proposed Final
Judgment provides for procedures by which the Court shall appoint a
trustee to complete the divestitures. In that case defendants must
cooperate fully with the trustee.
If a trustee is appointed, the proposed Final Judgment provides
that defendants will pay all costs and expenses of the trustee. The
trustee's
[[Page 33773]]
compensation will be structured so as to provide an incentive for the
trustee to obtain the highest price for the assets to be divested, and
to accomplish the divestiture as quickly as possible. After the
effective date of his or her appointment, the trustee shall serve under
such other conditions as the Court may prescribe. After his or her
appointment becomes effective, the trustee will file monthly reports
with the parties and the Court, setting forth the trustee's efforts to
accomplish the divestiture. At the end of six (6) months, if the
divestiture has not been accomplished, the trustee shall file promptly
with the Court a report that sets forth: (1) The trustee's efforts to
accomplish the divestiture, (2) the reasons, in the trustee's judgment,
why the divestiture has not been accomplished, and (3) the trustee's
recommendations. The trustee's report will be furnished to the parties
and shall be filed in the public docket, except to the extent the
report contains information the trustee deems confidential. The parties
each will have the right to make additional recommendations to the
Court. The Court shall enter such orders as it deems appropriate to
carry out the purpose of the trust.
The proposed Final Judgment also imposes a hold separate agreement
that requires defendants to ensure that, until the divestiture mandated
by the Final Judgment has been accomplished, S-K-I's Waterville Valley
and ASC's Mt. Cranmore operations will be held separate and apart from,
and operated independently of, defendants' other assets and businesses.
IV. Remedies Available to Potential Private Litigants
Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any
person who has been injured as a result of conduct prohibited by the
antitrust laws may bring suit in federal court to recover three times
the damages the person has suffered, as well as costs and reasonable
attorney's fees. Entry of the proposed Final Judgment will neither
impair nor assist the bringing of any private antitrust damage action.
Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C.
16(a), the proposed Final Judgment has no prima facie effect in any
subsequent private lawsuit that may be brought against ASC or S-K-I.
V. Procedures Available for Modification of the Proposed Final Judgment
The United States and the defendants have stipulated that the
proposed Final Judgment may be entered by the Court after compliance
with the provisions of the APPA, provided that the United States has
not withdrawn its consent. The APPA conditions entry upon the Court's
determination that the proposed Final Judgment is in the public
interest.
The APPA provides a period of at least sixty (60) days preceding
the effective date of the proposed Final Judgment within which any
person may submit to the United States written comments regarding the
proposed Final Judgment. Any person who wishes to comment should do so
within sixty (60) days of the date of publication of this Competitive
Impact Statement in the Federal Register. The United States will
evaluate and respond to the comments. All comments will be given due
consideration by the Department of Justice, which remains free to
withdraw its consent to the proposed Final Judgment at any time prior
to entry. The comments and the response of the United States will be
filed with the Court and published in the Federal Register.
Written comments should be submitted to: Craig W. Conrath, Chief,
Merger Task Force, Antitrust Division, United States Department of
Justice, 1401 H Street, N.W., Suite 4000, Washington, D.C. 20530. The
proposed Final Judgment provides that the Court retains jurisdiction
over this action, and the parties may apply to the Court for any order
necessary or appropriate for the modification, interpretation, or
enforcement of the Final Judgment.
VI. Alternatives to the Proposed Final Judgment
The United States considered, as an alternative to the proposed
Final Judgment, a full trial on the merits of its Complaint against ASC
and against S-K-I. The United States is satisfied, however, that the
divestitute of the assets and other relief contained in the proposed
Final Judgment will preserve viable competition in the operation of ski
resorts that otherwise would be affected adversely by the acquisition.
Thus, the proposed Final Judgment would achieve the relief the
government would have obtained through litigation, but avoids the time,
expense, and uncertainty of a full trial on the merits of the
government's Complaint.
VII. Standard of Review Under the APPA for Proposed Final Judgment
The APPA requires that proposed consent judgments in antitrust
cases brought by the United States be subject to a sixty (60) day
comment period, after which the court shall determine whether entry of
the proposed Final Judgment ``is in the public interest.'' In making
that determination, the court may consider--
(1) the competitive impact of such judgment, including
termination of alleged violations, provisions for enforcement and
modification, duration or relief sought, anticipated effects of
alternative remedies actually considered, and any other
considerations bearing upon the adequacy of such judgment;
(2) the impact of entry of such judgment upon the public
generally and individuals alleging specific injury from the
violations set forth in the complaint including consideration of the
public benefit, if any, to be derived from a determination of the
issues at trial.
15 U.S.C. 16(e) (emphasis added). As the United States Court of Appeals
for the D.C. Circuit recently held, this statute permits a court to
consider, among other things, the relationship between the remedy
secured and the specific allegations set forth in the government's
complaint, whether the decree is sufficiently clear, whether
enforcement mechanisms are sufficient, and whether the decree may
positively harm third parties. See United States v. Microsoft, 56 F.3d
1448, 1461-62 (D.C. Cir. 1995).
In conducting this inquiry, ``the Court is nowhere compelled to go
to trial or to engage in extended proceedings which might have the
effect of vitiating the benefits of prompt and less costly settlement
through the consent decree process.'' \1\ Rather,
\1\ 119 Cong. Rec. 24598 (1973). See United States v. Gillette
Co., 406 F. Supp. 713, 715 (D. Mass. 1975). A ``public interest''
determination can be made properly on the basis of the Competitive
Impact Statement and Response to Comments filed pursuant to the
APPA. Although the APPA authorizes the use of additional procedures,
15 U.S.C. 16(f), those procedures are discretionary. A court need
not invoke any of them unless it believes that the comments have
raised significant issues and that further proceedings would aid the
court in resolving those issues. See H.R. Rep. 93-1463, 93rd Cong.
2d Sess. 8-9, reprinted in (1974) U.S. Code Cong. & Ad. News 6535,
6538.
---------------------------------------------------------------------------
absent a showing of corrupt failure of the government to discharge
its duty, the Court, in making its public interest finding, should *
* * carefully consider the explanations of the government in the
competitive impact statement and its responses to comments in order
to determine whether those explanations are reasonable under the
circumstances.
United States v. Mid-America Dairymen, Inc., 1997-1 Trade Gas. para.
61,508, at 71,980 (W.D. Mo. 1977).
Accordingly, with respect to the adequacy of the relief secured by
the decree, a court may not ``engage in an unrestricted evaluation of
what relief would best serve the public.'' United States v. BNS, Inc.,
858 F.2d 456, 462 (9th Cir. 1988) quoting United States v. Bechtel
Corp., 648 F.2d 660, 666 (9th
[[Page 33774]]
Cir.), cert. denied, 454 U.S. 1083 (1981); see also Microsoft, 56 F.3d
at 1460-62. Precedent requires that
the balancing of competing social and political interests affected
by a proposed antitrust consent decree must be left, in the first
instance, to the discretion of the Attorney General. The court's
role in protecting the public interest is one of insuring that the
government has not breached its duty to the public in consenting to
the decree. The court is required to determine not whether a
particular decree is the one that will best serve society, but
whether the settlement is ``within the reaches of the public
interest.'' More elaborate requirements might undermine the
effectiveness of antitrust enforcement by consent decree.\2\
\2\ United States v. Bechtel, 648 F.2d at 666 (citations
omitted) (emphasis added); see United States v. BNS, Inc., 858 F.2d
at 463; United States v. National Broadcasting Co., 449 F. Supp.
1127, 1143 (C.D. Cal. 1978); United States v. Gillette Co., 406 F.
Supp. at 716. See also Microsoft, 56 F.3d at 1461 (whether ``the
remedies [obtained in the decree are] so inconsonant with the
allegations charged as to fall outside of the `reaches of the public
interest.' '') (citations omitted).
---------------------------------------------------------------------------
The proposed Final Judgment, therefore, should not be reviewed
under a standard of whether it is certain to eliminate every
anticompetitive effect of a particular practice or whether it mandates
certainty of free competition in the future. Court approval of a final
judgment requires a standard more flexible and less strict than the
standard required for a finding of liability. ``[A] proposed decree
must be approved even if it falls short of the remedy the court would
impose on its own, as long as it falls within the range of
acceptability or is `within the reaches of public interest.' (citations
omitted).'' \3\
---------------------------------------------------------------------------
\3\ United States v. American Tel. and Tel. Co., 552 F. Supp.
131, 150 (D.D.C. 1982), aff'd sub nom. Maryland v. United States,
460 U.S. 1001 (1983), quoting United States v. Gillette Co., supra,
406 F. Supp. at 716; United States v. Alcan Aluminum Ltd., 605 F.
Supp. 619, 622 (W.D. Ky. 1985).
---------------------------------------------------------------------------
VIII. Determinative Documents
There are no determinative materials or documents within the
meaning of the APPA that were considered by the United States in
formulating the proposed Final Judgment.
Respectfully submitted,
Burney P.C. Huber,
Attorney, D.C. Bar #181818, Dept. of Justice, Antitrust Division, 1401
H Street, NW., Suite 4000, Washington, DC 20530, (202) 307-1858.
June 18, 1996.
[FR Doc. 96-16497 Filed 6-27-96; 8:45 am]
BILLING CODE 4410-01-M