[Federal Register Volume 60, Number 212 (Thursday, November 2, 1995)]
[Notices]
[Pages 55730-55739]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-27060]
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DEPARTMENT OF JUSTICE
Antitrust Division
United States v. Reuter Recycling of Florida, Inc. and Waste
Management Inc. of Florida; Proposed Final Judgment and Competitive
Impact Statement
Notice is hereby given pursuant to the Antitrust Procedures and
Penalties Act, 15 U.S.C. Sec. 16(b)-(h), that a proposed Final Consent
Judgment, Stipulation, and Competitive Impact Statement have been filed
with the United States District Court for the District of Columbia, in
a civil antitrust case, United States v. Reuter Recycling of Florida,
Inc. and Waste Management Inc. of Florida, Civ. No. 1:95CV01982.
On October 20, 1995, the United States and the State of Florida
filed a Complaint seeking to enjoin a
[[Page 55731]]
transaction by which Waste Management Inc. of Florida agreed to acquire
Reuter. Waste Management and its affiliates constitute one of only two
private competitors in the market for solid waste disposal services in
Broward and Dade Counties, Florida. The other private competitor--
Chambers Waste Systems of Florida, Inc.--can only effectively compete
in that market because it has access to a transfer station owned by
Reuter. Waste Management would acquire that transfer station in the
acquisition. The Complaint alleged that the proposed acquisition may
substantially lessen competition in the municipal solid waste disposal
services market in Dade and Broward Counties, Florida, in violation of
Section 7 of the Clayton Act, 15 U.S.C. 18.
The proposed Final Judgment requires defendants to give Chambers
unimpeded access to the Reuter Transfer Station for up to five years.
It also requires defendants to make certain real estate available to
Chambers for up to five years upon which Chambers may construct its own
transfer station. A Competitive Impact Statement filed by the United
States describes the Complaint, the proposed Final Judgment, and
remedies available to private litigants.
The Public is invited to comment to the Justice Department and to
the Court. Comments should be addressed to Anthony V. Nanni, Chief,
Litigation I Section, U.S. Department of Justice, Antitrust Division,
1401 H Street N.W., Room 4000, Washington, D.C. 20530 (telephone: (202)
307-5777). Comments must be received within sixty days.
Copies of the Complaint, proposed Final Judgment, and Competitive
Impact Statement are available for inspection in Room 207 of the U.S.
Department of Justice, Antitrust Division, 325 7th Street, N.W.,
Washington, D.C. 20530 (telephone: (202) 514-2481). Copies of these
materials may be obtained upon request and payment of a copying fee.
Constance K. Robinson,
Director of Operations.
In the United States District Court for the District of Columbia
In the matter of: UNITED STATES OF AMERICA, and STATE OF
FLORIDA, by and through its Attorney General, Plaintiffs, v. REUTER
RECYCLING OF FLORIDA, INC., and WASTE MANAGEMENT INC. OF FLORIDA,
Defendants. Civil Action No.: 1:95CV01982; Filed: 10/20/95; Judge
Royce C. Lambert.
Complaint
The United States of America, acting under the direction of the
Attorney General of the United States, and the State of Florida, acting
under the direction of the Attorney General of the State of Florida,
plaintiffs, bring this civil action to obtain equitable and other
relief against the defendants named and allege as follows:
1. The United States and the State of Florida bring this antitrust
case to prevent the proposed acquisition by Waste Management Inc. of
Florida (``WMF'') of Reuter Recycling of Florida, Inc. (``Reuter'').
The acquisition will reduce the entities competing for municipal solid
waste disposal service in the relevant geographic market from three to
two and will substantially increase concentration among municipal solid
waste disposal entities in that market.
2. If this transaction is not blocked, consumers will be harmed by
having to pay significant and immediate price increases for municipal
solid waste disposal service, as the history in the market indicates.
After Chambers Waste Systems of Florida, Inc. (``Chambers'') entered
the relevant geographic market by using a transfer station owned by
Reuter, prices for municipal solid waste disposal service dropped
substantially. Consequently, this transaction must be enjoined to
protect consumers.
I
Jurisdiction and Venue
3. This action is filed under Section 15 of the Clayton Act, 15
U.S.C. 25, and 15 U.S.C. 26, to prevent and to restrain the violation
by the defendants, as hereinafter alleged, of Section 7 of the Clayton
Act, 15 U.S.C. 18.
4. Reuter and WMF are engaged in interstate commerce and in
activities substantially affecting interstate commerce. The Court has
jurisdiction over this action, over the parties, and venue is
appropriate in this District, pursuant to 15 U.S.C. 22 and 28 U.S.C.
Secs. 1391 and 1337, since both defendants consent to personal
jurisdiction in this proceeding.
II
Defendants
5. WMF is a Florida corporation with its principal offices in
Pompano Beach, Florida. WMF provides municipal solid waste disposal
service within the State of Florida. In 1994, WMF reported total
revenues of over $245 million.
6. Reuter is a Florida corporation with its principal offices in
Pembroke Pines, Florida. Reuter provides municipal solid waste disposal
service within the State of Florida through the Transfer Station
Agreement with Chambers. In 1994, Reuter reported total revenues in
excess of $13 million.
IV
Trade and Commerce
7. Municipal solid waste is nonhazardous waste collected from
households, and commercial and industrial establishments. It includes
waste that is putrescible (such as garbage) and compactible but does
not include construction and demolition debris. The waste is generally
collected by municipalities or private haulers with collection trucks.
When the collection truck is full, it must leave its collection route
and travel to a municipal solid waste disposal site where the truck is
emptied.
8. Municipal solid waste disposal service is the final disposal of
municipal solid waste in a landfill or a facility that incinerates that
waste. Municipal solid waste can be transported to a relatively distant
final disposal site by using a transfer station. At a transfer station,
municipal solid waste is received from municipal and private haulers.
Generally, the waste is combined, further compacted, and then loaded
into large tractor trailer trucks. These tractor trailer trucks can
economically transport that waste a considerably longer distance to a
final disposal site than can collection trucks.
9. The provision of municipal solid waster disposal service is a
relevant product for purposes of analyzing this acquisition under the
Clayton Act. There is no practical substitute for municipal solid waste
disposal service to which a significant number of customers would
switch in response to a small but significant, nontransitory increase
in price imposed by all providers of municipal solid waste disposal
service.
10. State and federal laws restrict the facilities that may accept
municipal solid waste for final disposal. Municipal solid waste
disposal service is provided to consumers in Dade and Broward Counties
through facilities owned or operated by Defendant WMF, directly or
through its affiliates, in Broward County, Florida and in Dade County,
Florida, owned or operated by Dade County, Florida in Dade; and, owned
by Chambers in Okeechobee County, Florida, about 100 miles north of
Dade. Chambers transports municipal solid waste to its Okeechobee
landfill from the Reuter transfer station in southern Broward pursuant
to an agreement between Reuter and Chambers dated July 14, 1993
(``Transfer Station Agreement''). The Reuter transfer station is
currently the only means by which Chambers can transport municipal
solid waste from consumers in Dade and
[[Page 55732]]
Broward Counties to its landfill in Okeechobee County.
11. The relevant geographic market for purposes of analyzing this
transaction is Broward and Dade Counties, Florida. The above facilities
are the only significant disposal sites for Broward and Dade municipal
solid waste. County-owned facilities in St. Lucie, Martin and Palm
Beach Counties are not alternative municipal solid waste disposal sites
for Dade and Broward Counties, since the distance from Dade and Broward
Counties is too great to be economically travelled by collection
trucks. In addition, these facilities do not generally take out-of-
county waste and are much higher priced alternatives than the
Okeechobee landfill for waste from the relevant geographic market. It
is not economically efficient for municipal solid waste haulers to
transport that waste long distances in collection trucks to a municipal
solid waste disposal site. Consequently, haulers generally transport
the waste to nearby landfills or incinerators or transfer stations that
enable waste economically to be hauled to more distant disposal sites.
Therefore, other municipal solid waste disposal sites outside the area
are not substitutes for service provided by the facilities described in
paragraph 10.
12. Defendant WMF and Chambers compete with each other and with
Dade to provide municipal solid waste disposal service to
municipalities and private haulers in the relevant geographic market.
WMF, Chambers, and Dade bid against one another for the right to
dispose of municipal solid waste in that area. The vast majority of
this waste is generated in Dade. Chambers is currently able to compete
for this waste only because it has access to the transfer station owned
by Defendant Reuter in southern Broward County, Florida pursuant to the
Transfer Station Agreement.
13. The acquisition of Reuter by WMF will have the effect of
excluding Chambers from its only current means of economically
providing municipal solid waste disposal service in Broward and Dade
Counties in competition with WMF and Dade and will therefore reduce the
firms competing for municipal solid waste disposal service there from
three to two. Therefore, the acquisition of Reuter by WMF will
substantially increase concentration among municipal solid waste
disposal entities in the relevant geographic market. Using a measure of
market concentration called the HHI, defined and explained in Appendix
A, the acquisition of Reuter by WMF would increase the HHI by about
1,700 to about 5,000.
14. The only significant competitor of WMF that would remain after
the acquisition is Dade County. Rivalry between WMF and Dade County
alone will not prevent prices from rising, because Chambers provides a
substantial competitive check on WMF's and Dade County's individual
ability to set prices for their services. This is evidenced by the
substantial drop in municipal solid waste disposal service prices that
followed Chambers' entry into the market.
15. There are substantial barriers to entry into municipal solid
waste disposal service in the relevant geographic market. The siting,
permitting and construction of a municipal solid waste landlfill or
incinerator within or near Dade will take well in excess of two years,
if such a facility is permitted to be constructed at all. Furthermore,
the zoning, siting, permitting and construction of a municipal solid
waste transfer station in a commercially and economically feasible
location to receive municipal solid waste from the relevant geographic
market is likely to take more than two years.
V
Violation Alleged
16. On June 1, 1995, defendant WMF and the parent of Reuter signed
a purchase agreement providing for the purchase by WMF of all of the
outstanding common stock of Reuter.
17. The effect of the acquisition of Reuter by WMF may be
substantially to lessen competition in the aforesaid trade and commerce
in violation of Section 7 of the Clayton Act in the following ways,
among others:
(a) Actual competition and potential competition between WMF and
Chambers in municipal solid waste disposal service in the above-
described geographic market will be eliminated; and
(b) Actual and potential competition generally in municipal solid
waste disposal service in that geographic market may be substantially
lessened.
Prayer
WHEREFORE, plaintiffs pray,
1. That the proposed acquisition of the common stock of Reuter by
WMF be adjudged to be in violation of Section 7 of the Clayton Act;
2. That the defendants and all persons acting on their behalf be
permanently enjoined from carrying out the acquisition of the common
stock of Reuter by WMF or any similar agreement, understanding, or
plan.
3. That the plaintiffs have such other and further relief as the
Court may deem just and proper; and
4. That plaintiffs recover the costs of this action.
Dated: This 20th day of October, 1995.
FOR PLAINTIFF UNITED STATES OF AMERICA:
Anne K. Bingaman,
Assistant Attorney General
Lawrence R. Fullerton,
Deputy Assistant Attorney General
Constance K. Robinson,
Director of Operations
Charles E. Biggio,
Senior Counsel
Anthony V. Nanni,
Chief, Litigation I Section
Willie L. Hudgins, Jr.
Attorneys, U.S. Department of Justice, Antitrust Division.
Nancy H. McMillen,
Attorney, U.S. Department of Justice, Antitrust Division, 1401 H
Street, N.W., Suite 4000, Washington, D.C. 20530, 202/307-5777
For Plaintiff State of Florida:
Robert A. Butterworth,
Attorney General.
Patricia A. Conners,
Assistant Attorney General.
Lizabeth A. Leeds,
Assistant Attorney General.
H. Edward Burgess, Jr.,
Assistant Attorney General, Office of Attorney General, State of
Florida, The Capitol, Tallahassee, FL 32399-1050, (904) 488-9105.
Appendix A
``HHI'' means the Herfindahl-Hirschman Index, a commonly
accepted measure of market concentration calculated by squaring the
market share of each firm competing in the market and then summing
the resulting numbers. For example, for a market consisting of four
firms with shares of 30, 30, 20, and 20 percent, respectively, the
HHI is 2600 (30 squared + 30 squared + 20 squared + 20 squared =
2600). The HHI, which takes into account the relative size and
distribution of the firms in a market, ranges from virtually zero to
10,000. The index approaches zero when a market consists of a large
number of firms of relatively equal size. The index increases as the
number of firms in the market decreases and may also increase as the
disparity in size between the leading firms and the remaining firms
increases. Thus, a market of two firms with shares of 60 and 40
percent would have an HHI of 5200 (60 squared + 40 squared = 3600 +
1600 = 5200).
The Department of Justice and Federal Trade Commission 1992
Horizontal Merger Guidelines consider that markets in which the HHI
is between 1000 and 1800 are moderately concentrated and those in
which the HHI is in excess of 1800 points are concentrated.
Transactions that increase the HHI by more than 100 points in
moderately concentrated and concentrated markets
[[Page 55733]]
presumptively raise antitrust concerns under the Merger Guidelines.
United States District Court for the District of Columbia
In the matter of: UNITED STATES OF AMERICA, and STATE OF
FLORIDA, by and through its Attorney General, Plaintiffs, v. REUTER
RECYCLING OF FLORIDA, INC., and WASTE MANAGEMENT INC. OF FLORIDA,
Defendants. Civil Action No.: 1:95CV01982, Filed: 10/20/95.
Stipulation
It is stipulated by and between the undersigned parties, by their
respective attorneys, that:
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 of Columbia.
2. The parties consent 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 (b)-(h)), and without further notice to any party or other
proceedings, provided that Plaintiffs have not withdrawn their consent,
which they may do at any time before the entry of the proposed Final
Judgment by serving notice thereof on the Defendants and by filing that
notice with the Court; and
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 thereof as though the same were in full force and
effect as an order of the Court.
4. This Stipulation shall become effective when, if and only if,
defendant Waste Management Inc. of Florida acquires a majority of the
outstanding shares of defendant Reuter Recycling of Florida, Inc. If
the Plaintiffs withdraw their consent or if the proposed Final Judgment
is not entered pursuant to this Stipulation, this Stipulation shall be
of no effect whatsoever, and the making of this Stipulation shall be
without prejudice to any party in this or in any other proceeding.
Dated this 20th day of October, 1995.
Respectfully submitted,
For the Plaintiff the United States of America:
Anne K. Bingaman,
Assistant Attorney General, Antitrust Division, U.S. Department of
Justice.
Lawrence R. Fullerton,
Deputy Assistant Attorney General.
Constance K. Robinson,
Director of Operations.
Charles E. Biggio,
Senior Counsel.
Anthony V. Nanni,
Chief, Litigation I Section.
Willie L. Hudgins, Jr.,
Attorney, U.S. Department of Justice, Antitrust Division.
Nancy H. McMillen,
Attorney, U.S. Department of Justice, Antitrust Division, City Center
Building, Suite 4000, 1401 H Street, NW., Washington, DC 20530, 202/
307-5777.
For Plaintiff State of Florida:
Robert A. Butterworth,
Attorney General.
Patricia A. Conners,
Assistant Attorney General.
Lizabeth A. Leeds,
Assistant Attorney General.
H. Edward Burgess, Jr.,
Assistant Attorney General, Office of Attorney General, State of
Florida, The Capitol, Tallahassee, Florida 32399-1050, (904) 488-9105.
For the Defendant Reuter Recycling of Florida, Inc.:
John H. Korns,
(D.C. Bar No. 142745), Oppenheimer, Wolff & Donnelly, 1020 19th Street,
N.W., Suite 400, Washington, D.C. 20036, (202) 293-6300.
For the Defendant Waste Management Inc. of Florida:
Michael Sennett,
Bell, Boyd & Lloyd, Three First National Plaza, Chicago, Illinois
60602, (312) 372-1121.
Andrew N. Cook,
(D.C. Bar No. 416199), Bell, Boyd & Lloyd, 1615 L Street, N.W.,
Washington, D.C. 20036, (202) 466-6300.
In The United States District Court for The District of Columbia
In the matter of: UNITED STATES OF AMERICA, and STATE OF
FLORIDA, by and through its Attorney General, Plaintiffs, v. REUTER
RECYCLING OF FLORIDA, INC., and WASTE MANAGEMENT INC. OF FLORIDA,
Defendants. Civil Action No.: 1:95CV01982; Filed: 10/20/95.
Final Judgment
WHEREAS Plaintiffs, United States of America (hereinafter ``United
States'') and the State of Florida (hereinafter ``Florida''), having
filed their Complaint in this action on October 20, 1995, and
Plaintiffs 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; and without this Final
Judgment constituting any evidence or admission by any party with
respect to any issue of fact or law;
AND WHEREAS, Defendants have agreed to be bound by the provisions
of this Final Judgment pending its approval by the Court;
AND WHEREAS, the Plaintiffs intend Defendants to be required to
preserve competition for solid waste disposal by honoring certain
contracts, as amended, and by giving to a competitor an option to
purchase real property capable of being used as a municipal solid waste
transfer station to preserve competition in solid waste disposal in
Dade and Broward Counties, Florida, now and in the future, and, by
permitting a competitor to preserve its ability to compete for and to
have access to capacity for sufficient volumes of municipal solid waste
to remain a viable solid waste disposal competitor while it seeks
another transfer station site;
AND WHEREAS, Defendants have represented that the contract changes
and the option agreement to purchase real estate described below can
and will be made and honored and that Defendants will later raise no
claims of hardship or difficulty as grounds for asking the Court to
modify any of the provisions contained below;
NOW, THEREFORE, before any testimony is taken, and without trial or
adjudication of any issue of fact or law, and upon consent of the
parties, it is hereby
ORDERED, ADJUDGED AND DECREED as follows:
I
Jurisdiction
This Court has jurisdiction of the subject matter of this action
and over each of the parties hereto. The Complaint states a claim upon
which relief may be granted against Defendants under Section 7 of the
Clayton Act, as amended, 15 U.S.C. 18.
II
Definitions
As used in this Final Judgment:
(A) ``Broward'' means Broward County, Florida.
(B) ``Chambers'' means Chambers Waste Systems of Florida, Inc., a
subsidiary of USA Waste Services, Inc. Chambers is a corporation
organized and existing under the laws of the State of Florida with its
principal offices in Okeechobee, Florida.
(C) ``Dade'' means Dade County, Florida.
[[Page 55734]]
(D) ``Defendants'' means Reuter and WMF, as hereinafter defined.
(E) ``Reuter'' means defendant Reuter Recycling of Florida, Inc.
Reuter is a corporation organized and existing under the laws of the
State of Florida with its principal offices in Pembroke Pines, Florida.
(F) ``Solid waste disposal service'' means the final disposal of
municipal solid waste, generally in a landfill or incineration
facility.
(G) ``Transfer Station Agreement'' means the agreement between
Reuter and Chambers dated as of July 14, 1993 pursuant to which Reuter,
among other things, accepts for transfer certain solid waste material
delivered by Chambers or Chambers' subcontractors. A copy of the
Transfer Station Agreement is attached as Exhibit A.
(H) ``Amendment to Transfer Station Agreement'' means the Agreement
between Reuter and Chambers dated October 20, 1995 modifying the
Transfer Station Agreement. A copy of the Amendment to Transfer Station
Agreement is attached as Exhibit B.
(I) ``Option Agreement'' means the Agreement between Reuter and
Chambers dated October 20, 1995. A copy of the Option Agreement is
attached as Exhibit C.
(J) ``WMF'' means defendant Waste Management Inc. of Florida, a
subsidiary of Waste Management, Inc. WMF is a corporation organized and
existing under the laws of the State of Florida with its principal
offices in Pompano Beach, Florida.
(K) ``Acquisition'' means the acquisition of the majority of the
outstanding stock of Reuter by WMF.
(L) ``Reuter Transfer Station'' means the facility owned by Reuter
and located at 2079 Pembroke Road, Pembroke Pines, FL which currently,
among other things, accepts for transfer certain solid waste material
delivered by Chambers or Chambers' subcontractors and also accepts
waste from the cities of Pompano Beach, Pembroke Pines, Dania, and
Hallandale, FL.
III
Applicability
This Final Judgment applies to Defendants and to their officers,
directors, managers, agents, employees, successors, assigns,
affiliates, parents and subsidiaries, and to 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. Nothing contained in this Final Judgment is or has been
created for the benefit of any third party, and nothing herein shall be
construed to provide any rights to any third party.
IV
Entry Into and Compliance With Agreements
On or before the date the Acquisition is consummated, Reuter shall
enter into the Amendment to Transfer Station Agreement and the Option
Agreement. Defendants shall be bound by the terms of the Transfer
Station Agreement, as modified by the Amendment to Transfer Station
Agreement, and the Option Agreement. Defendants shall not convey to any
person other than Chambers, the property subject to the Option
Agreement, prior to the later of July 14, 1998 or any extension of that
Option Agreement, except as provided in the Option Agreement.
Defendants shall not exercise their right to replace Chambers as the
Facility operator under Paragraph 3f of the Amendment to Transfer
Station Agreement without the prior approval of the United States, in
consultation with Florida.
V
Termination of the Agreements
In the event Chambers has secured the right to use and is using
another transfer station capable of serving Broward or Dade Counties
prior to July 14, 1998, Defendants may notify Plaintiffs of that fact
and Defendants may request in writing that they be relieved of the
obligation to extend the term of the Transfer Station Agreement as set
forth in Paragraph 2 of the Amendment to Transfer Station Agreement,
and of the obligation to convey property under the Option Agreement.
The United States may grant one or both of Defendants' requests if it
determines, in its sole discretion after consultation with Florida,
that Chambers can effectively compete in the relevant markets without
access to the Reuter Transfer Station or without access to the property
subject to the Option Agreement.
VI
Interim Preservation of Viable Competition
(A) Defendants shall not enter into any contract or contracts, with
any firm listed on Exhibit D, having a term in excess of one (1) year,
or having multiple consecutive one (1) year terms, for the disposal of
solid waste, where any such waste would be transported through the
Reuter Transfer Station for disposal elsewhere. Exhibit D is a list of
the customers of Chambers for whom Chambers uses the Reuter Transfer
Station to enable it to dispose of solid waste as of the date this
Final Judgment is filed (``Chambers Customers'').
(B) Defendants' obligations under Paragraph VI.A. shall terminate
upon the United States providing Defendants with written notice,
following application by Defendants, that the United States, in its
sole discretion after consultation with Florida, has determined that
Chambers can compete effectively in the relevant market if Defendants
are permitted to contract with Chambers' Customers as proscribed in
Paragraph VI.A. In any event, Paragraph VI.A. shall terminate on the
date the Transfer Station Agreement, as amended by the Amendment to the
Transfer Station Agreement, terminates.
(C) Nothing herein shall preclude Defendants from contracting with
any of the Chambers' Customers for a period of one (1) year or less;
or, for a period in excess of one (1) year where that customer's solid
waste is not transported by Defendants, directly or indirectly, through
the Reuter Transfer Station.
VII
Defendants' Obligations of Noninterference and Assistance
In the event that Chambers seeks to permit a new transfer station
or seeks access to a new or existing transfer station other than the
Reuter Transfer Station, Defendants shall take no action to protest,
lobby against, object to, or otherwise impede, directly or indirectly,
any attempts by Chambers to lease, purchase, site, obtain appropriate
zoning for, obtain permits and any and all other governmental approvals
for a solid waste transfer station capable of serving Broward or Dade,
nor shall Defendants provide financing or other assistance to any
person who does so. Furthermore, from the effective date of the Option
Agreement through the termination date of that Agreement, including any
extensions thereof, Defendants will cooperate with Chambers' efforts to
obtain any necessary government approvals on the property subject to
the Option Agreement.
Notwithstanding the provisions of this Final Judgment, Defendants
may bid on and enter into contracts with municipal or governmental
entities for the provision or use of transfer station facilities in
Dade and Broward.
VIII
Acquisition of the Option Property
If the option to purchase under the Option Agreement is exercised,
Defendants shall not, without prior
[[Page 55735]]
written consent of the United States, after consultation with Florida,
re-acquire any of the property conveyed pursuant to the Option
Agreement.
IX
Reporting and Plaintiffs' Access
(A) To determine or secure compliance with this Final Judgment,
duly authorized representatives of the Plaintiffs shall, upon written
request of the Assistant Attorney General in charge of the Antitrust
Division or the Florida Attorney General or his duly authorized
representative, respectively, on reasonable notice given to Defendants
at their principal offices, subject to any lawful privilege, be
permitted:
(1) Access during normal office hours to inspect and copy all
books, ledgers, accounts, correspondence, memoranda and other documents
and records in the possession, custody, or control of Defendants, which
may have counsel present, relating to any matters contained in this
Final Judgment.
(2) Subject to the reasonable convenience of Defendants and without
restraint or interference from them, to interview officers, employees,
or agents of Defendants, who may have counsel present, regarding any
matters contained in this Final Judgment.
(B) Upon written request of the Assistant Attorney General in
charge of the Antitrust Division or the Florida Attorney General or his
duly authorized representative, on reasonable notice given to
Defendants at their principal offices, subject to any lawful privilege,
Defendants shall submit such written reports, under oath if requested,
with respect to any matters contained in this Final Judgment.
(C) No information or documents obtained by the means provided by
this Section shall be divulged by the Plaintiffs to any person other
than a duly authorized representative of the Executive Branch of the
United States government or of the State of Florida, except in the
course of legal proceedings to which the United States is a party, or
for the purpose of securing compliance with this Final Judgment, or as
otherwise required by law.
(D) If at the time information or documents are furnished by
Defendants to Plaintiffs, Defendants represent and identify in writing
the materials in any such information or document 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 days notice shall be given
by Plaintiffs to Defendants prior to divulging such material in any
legal proceeding (other than a grand jury proceeding) to which
Defendants are not a party.
X
Further Elements of Judgment
(A) This Final Judgment shall expire on the tenth anniversary of
the date of its entry.
(B) Jurisdiction is retained by this Court over this action and the
parties thereto for the purpose of enabling any of the parties thereto
to apply to this Court at any time for further orders and directions as
may be necessary or appropriate to carry out or construe this Final
Judgment, to modify or terminate any of its provisions, to enforce
compliance, and to punish violations of its provisions.
XI
Public Interest
Entry of this Final Judgment is in the public interest.
Entered: __________
Court approval subject to procedures of Antitrust Procedures and
Penalties Act, 15 U.S.C. 16.
----------------------------------------------------------------------
United States District Judge
Note: Exhibits A, B, C & D will not be published in the Federal
Register but a copy can be obtained from the Department of Justice,
Antitrust Division's, Legal Procedures Office at (202) 514-2481.
United States District Court for the District of Columbia
In the matter of: UNITED STATES OF AMERICA, and STATE OF
FLORIDA, by and through its Attorney General Plaintiffs, v. REUTER
RECYCLING OF FLORIDA, INC. and WASTE MANAGEMENT INC. OF FLORIDA,
Defendants. CIVIL ACTION NO.: 1:95CV01982; Filed: 10/20/95.
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 October 20,
1995, alleging that the proposed acquisition of Reuter Recycling of
Florida, Inc. (``Reuter'') by Waste Management Inc. of Florida
(``WMF'') would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The
State of Florida, by and through its Attorney General, is a co-
plaintiff with the United States in this action.\1\ WMF and Reuter are
two of only three entities that provide municipal solid waste disposal
service in Broward and Dade Counties, Florida.
\1\ The APPA obligates only the United States to file a
Competitive Impact Statement.
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The Complaint alleges that the combination of these two competitors
would substantially lessen competition in solid waste disposal service
in Dade and Broward Counties, Florida. The prayer for relief seeks: (1)
A judgment that the proposed acquisition would violate section 7 of the
Clayton Act; and (2) a permanent injunction preventing WMF from
acquiring the stock of Reuter. At the same time that suit was filed, a
proposed Final Judgment was filed that was designed to eliminate the
anticompetitive effects of the acquisition. Also filed was a
Stipulation under which the parties consented to the entry of the
proposed Final Judgment.
The proposed Final Judgment preserves competition that would have
existed absent the acquisition by requiring defendants to give Chambers
unimpeded access to the Reuter Transfer Station for up to five years
from today. It also requires defendants to make certain real estate
available to Chambers for up to five years from today upon which
Chambers may construct its own transfer station.
The United States, its co-plaintiff, and Defendants have stipulated
that the proposed Final Judgment may be entered after compliance with
the APPA. Entry of the proposed Final Judgment would terminate the
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 Defendants and the Proposed Transaction
WMF, based in Pompano Beach, Florida, is an indirect wholly-owned
subsidiary of WMX Technologies, Inc., the world's largest solid waste
hauling and disposal company, with operations throughout the United
States. In 1994, WMF reported total revenues of over $245 million.
Reuter, based in Pembroke Pines, Florida, is a subsidiary of Reuter
Manufacturing, Inc., formerly known as Green Isle Environmental
Services, Inc. Reuter operates a municipal solid waste transfer station
and does some recycling
[[Page 55736]]
at a facility in Broward County, Florida. In 1994, Reuter reported
total revenues of over $13 million.
On June 1, 1995, WMF entered into an agreement to purchase from
Green Isle Environmental Services, Inc. all of the outstanding common
stock of Reuter for about $18 million.
B. The Solid Waste Disposal Industry
Municipal solid waste is nonhazardous waste collected from
households and commercial and industrial establishments. It includes
waste that is putrescible (such as garbage) and compactible, but does
not include construction and demolition debris. Municipal solid waste
is collected by municipalities or private haulers either with
collection trucks, that compact the waste in the truck, or roll-off
trucks. When the collection truck is full, it leaves its collection
route and travels to a municipal solid waste disposal site where the
truck is emptied. Roll-off trucks pick up large containers and take
them to the disposal site or transfer station individually.
Solid waste disposal service is the final disposal of municipal
solid waste, generally in a landfill or a facility that incinerates
that waste. It is generally not efficient to transport municipal solid
waste in collection trucks long distances. to disposal sites. Municipal
solid waste can be transported to a relatively distant final disposal
site by using a transfer station. Municipal solid waste accepted at a
transfer station is combined, further compacted, and then loaded into
large tractor trailer trucks. These tractor trailer trucks, which can
transport a volume of waste equal two to four times that of collection
trucks, can economically transport that waste a considerably longer
distance to a disposal site than can collection trucks.
Because of its unique disposal function, a small but significant
increase in the price of municipal solid waste disposal service by all
suppliers would not be rendered unprofitable by consumers substituting
to any other type of disposal service. State and federal laws restrict
the facilities that may accept municipal solid waste for final
disposal. In Florida, it is restricted to Class I and Class II
landfills \2\ and to facilities that incinerate the waste. Disposal of
municipal solid waste, as compared to disposal of construction and
demolition or other types of debris, accounts for a large percentage of
total disposal service revenues.
\2\ A Class I landfill in Florida is a landfill that receives an
average of 20 tons or more of solid waste per day. Each is permitted
to receive general, non-hazardous household, commercial, industrial,
and agricultural wastes. Class II landfills may receive up to 20
tons per day of these same types of waste, but there are no such
landfills in Dade or Broward counties, FL.
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C. Competition in the Relevant Market
WMF and Chambers Waste Systems of Florida, Inc. (``Chambers''),
through its use of the Reuter Facility pursuant to an agreement between
Chambers and Reuter, compete directly in providing municipal solid
waste disposal service in Broward and Dade Counties.
WMF, through its affiliates, owns or operates a Class I landfill
and two incineration facilities \3\ in Broward County that accept and
dispose of municipal solid waste. It also owns a Class I landfill in
Dade County that disposes of such waste. Dade County owns or operates
several Class I landfills and one incineration facility in Dade County.
\3\ The incinerators are resource recovery facilities owned by
Wheelabrator North Broward Inc. and Wheelabrator South Broward Inc.,
affiliates of WMF. These facilities accept municipal solid waste
pursuant to a contract with Broward County. These facilities also
compete for waste from other haulers and municipalities.
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Chambers owns a Class I landfill located in Okeechobee County,
Florida, about 100 miles north of Dade County, that accepts and
disposes of municipal solid waste from Dade and Broward Counties.
Pursuant to a contract containing an initial term of five years with
Reuter, dated July 14, 1993 (``Transfer Station Agreement''), Chambers
currently transports municipal solid waste to its Okeechobee landfill
from the transfer station owned by Reuter, which is located in
southwestern Broward County.
D. Nature of Competition
Prior to July 1993 WMF and Dade County were the only significant
suppliers of municipal solid waste disposal service in Dade and Broward
Counties. When Chambers entered the market, prices dropped
substantially. Chambers, therefore, has provided a significant
competitive constraint on pricing in the market. WMF and Chambers
compete for municipal solid waste disposal brought to their facilities
on a short-term basis absent any contract and for contracts with
municipalities and private haulers in the area that are not at the time
committed to a disposal site pursuant to a long-term contract. Almost
all of the solid waste collected in Broward County is under long-term
contracts. Consequently, the vast majority of the customers for which
WMF, Dade County, and Chambers currently compete generate municipal
solid waste in Dade County, Florida. Because its solid waste disposal
site is over 100 miles north of Dade County, Chambers is able to
compete for these customers in Dade County only because it has access
to the transfer station currently owned by Reuter--the transfer station
that WMF will control if it acquires the stock of Reuter.
The relevant geographic market for purposes of analyzing this
transaction is Broward and Dade Counties, Florida. The WMF Class I
landfills and incineration facilities, the Dade County incinerator and
Class I landfills, and Chambers' Okeechobee Class I landfill are the
only significant disposal sites for Broward and Dade municipal solid
waste.\4\ It is not economically efficient for municipal solid waste
haulers to transport that waste long distances in collection trucks to
a municipal solid waste disposal site. Consequently, haulers generally
transport the waste to nearby landfills, incinerators, or to transfer
stations that enable waste economically to be hauled to more distant
disposal sites.
\4\ Broward County has a Class I landfill, but that landfill
does not currently accept municipal solid waste. It was constructed
to accept waste until the two resource recovery facilities came on
line, to accept waste in the event of an incinerator shutdown, and
for its future use, if needed. There are landfills owned by St.
Lucie County, and Martin County, and an incinerator owned by Palm
Beach County that are within 100 miles of Dade County. However, they
are not good alternatives to disposal sites in Dade and Broward
Counties because the distance is too great for collection trucks to
reach economically. Furthermore, they are much higher-priced
alternatives than the Okeechobee landfill and do not generally
accept from Dade or Broward Counties.
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E. Anticompetitive Consequences of the Acquisition
The acquisition will place the Reuter Transfer Station in the hands
of WMF, who, as a competitor, will have the incentive and opportunity
to deprive Chambers of its only current means of economically providing
municipal solid waste disposal service in Dade County. This would
remove the competitive constraint of Chambers and facilitate WMF's
exercise of market power (i.e. the ability to increase prices to
consumers in Broward and Dade Counties). Specifically, the Complaint
alleges that the acquisition of Reuter by WMF will have the effect of
substantially increasing concentration in an already highly
concentrated, difficult to enter market; the HHI would increase by
about 1,700 to about 5,000.\5\
\5\ These HHI's are calculated using a bidding model. The three
existing competing bidders for municipal solid waste disposal
service in the market are treated as equal-sized firms for purposes
of this HHI calculation.
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The only significant competitor of WMF that would remain after the
[[Page 55737]]
acquisition is Dade County. Rivalry between WMF and Dade County alone
will not prevent prices from rising, because Chambers provides a
substantial competitive check on WMF's and Dade County's individual
ability to set prices for their services. This is evidenced by the
substantial drop in municipal solid waste disposal prices that followed
Chambers' entry into the market.
The Complaint alleges that new entry in the Broward and Dade County
market is unlikely to counteract these anticompetitive effects. The
siting, permitting and construction of a municipal solid waste landfill
or incinerator within or near Dade will take well in excess of two
years. In fact, it is unlikely that a new municipal solid waste
landfill or incinerator could be constructed in the area in the
foreseeable future, given opposition from the nearby general public to
such facilities.
The zoning, siting, permitting and construction of a municipal
solid waste transfer station in a commercially and economically
feasible location to receive municipal solid waste from the relevant
geographic market can also be expected to take more than two years due
to public opposition in this geographic market.
III
Explanation of the Proposed Final Judgment
The provisions of the proposed Final Judgment are designed to
preserve the level of competition that would exist absent this
acquisition, and thereby eliminate the anticompetitive effects of the
acquisition in municipal solid waste disposal service in the relevant
geographic market.
A. Entry Into and Compliance With Agreements
Section IV of the proposed Final Judgment requires that Reuter
shall enter into two agreements on or before the date WMF purchases the
majority of the stock of Reuter. First, Reuter is required to enter
into a contract with Chambers entitled ``Amendment to Transfer Station
Agreement'' (hereinafter ``Amendment''). Second, Reuter is required to
enter into an Option Agreement, giving Chambers an irrevocable option
to purchase certain property from Reuter upon which to construct its
own municipal solid waste transfer station. Section IV also prohibits
Reuter from conveying to anyone other than Chambers the property
subject to the Option Agreement prior to the later of July 14, 1998 or
any extension of the Option Agreement. Section IV obligates Reuter and
WMF to comply with the terms of both agreements.
1. Amendment to Transfer Station Agreement
On July 14, 1993, Reuter and Chambers entered into the Transfer
Station Agreement. That contract permitted Chambers to use the facility
built by Reuter as a transfer station to transport waste to Chambers'
Okeechobee landfill in south central Florida.
The agreement has a five year term and could be extended by mutual
agreement for two additional five year terms. Reuter operated the
transfer station under this agreement and agreed to pay Chambers to
transport municipal solid waste from the transfer station to Chambers'
landfill in Okeechobee County. In return, Chambers agreed to pay Reuter
for operating the transfer station. Initially, the vast majority of
waste transported through the transfer station came from four cities in
Broward County--Pompano Beach, Pembroke Pines, Dania, and Hallandale--
pursuant to a 20 year contract between Reuter and those cities.
However, the agreement also assured Chambers the right to bring up to
800 tons per day of waste from its own customers to the transfer
station for transportation to its landfill.
The Amendment requires WMF to honor the Transfer Station Agreement
giving Chambers access to the transfer station and modifies that
agreement in ways that prevent WMF from interfering with Chambers' use
of the transfer station to compete with WMF. The Amendment also
eliminates the provision that would have given WMF veto power over an
extension of the contract beyond its initial five year term. The
Amendment gives to Chambers, in its sole discretion, the option to
extend the Transfer Station Agreement for two additional one year
terms.
The Amendment modifies the Transfer Station Agreement to permit
Chambers to operate approximately one half of the transfer station
(roughly its current capacity) as an independent entity. In effect,
Chambers will replace Reuter as the operator of the transfer station
for the next three years, handling all waste from its customers and any
waste not recycled from the four cities. During any extension period,
Chambers will continue to operate about half of the transfer station,
handling waste from its own customers.
The Amendment also prohibits WMF from reducing Chambers' capacity
in the transfer station as the Transfer Station Agreement would have
allowed. The Amendment prohibits WMF from reducing the 800 ton per day
capacity Chambers currently has to use for the waste of its own
customers.
These, and other provisions in the Amendment, assure that Chambers
can operate in the acquired transfer station as an independent
competitive force in the solid waste disposal market as it would have
been able to do absent the acquisition.
2. Option Agreement
The proposed Final Judgment also requires Reuter to enter into an
Option Agreement on or before the date WMF acquires a majority of
Reuter's stock. The Option Agreement gives Chambers an irrevocable
option for up to three years to purchase certain real estate. That real
estate is on the grounds of the current Reuter Transfer Station
facility. Chambers will have up to three years to seek necessary
permits before it needs to pay Reuter any substantial monies for the
real estate. Furthermore, during the initial three years of the Option
Agreement, Chambers is not obligated to purchase the land. It may seek
to permit the site for a transfer station without actually buying the
real estate.
The Option Agreement also gives Chambers the right to extend the
option for two additional one year periods upon payment to Reuter of a
fee, part of which will be credited toward the purchase price if
Chambers buys the property. Chambers' right to extend the Option
Agreement is contingent upon Chambers' active pursuit of transfer
station permits from the appropriate state and county authorities.
This Option Agreement provides Chambers with the right to purchase
a well-situated piece of real estate upon which to permit and build its
own transfer station for use in the long term. It gives Chambers up to
five years to obtain any necessary permits on the land without actually
purchasing the real estate from Reuter.
B. Termination of the Agreements
The proposed Final Judgment also provides that the obligations of
the Defendants under the above agreements can be terminated under
certain conditions. Specifically, if Defendants notify Plaintiffs that
Chambers has secured the right to use and is using another transfer
station capable of serving the relevant geographic market at current or
increased capacity levels, Plaintiffs may relieve Defendants of the
obligation to extend the Transfer Station Agreement or to hold open the
Option Agreement. As provided in the proposed Final Judgment, however,
the
[[Page 55738]]
Plaintiffs will not relieve Defendants of these obligations unless the
United States has determined, after consultation with Florida, that
Chambers can effectively compete in the relevant market without access
to either the Reuter Transfer Station under the Transfer Station
Agreement, as amended, or without the property subject to the Option
Agreement.
C. Interim Preservation of Viable Competition
Section VI of the proposed Final Judgment assures that competition
is not unduly undermined by the fact that Chambers has access to the
Reuter Transfer Station for only a limited period of time while WMF has
use of that facility for the long term. Specifically, the provision is
designed to assure that WMF cannot tie up all customers that want to
use the Reuter Transfer Station by offering long-term contracts when
Chambers would be at a huge competitive disadvantage in offering
similar contracts. The provision prohibits WMF from offering contracts
for longer than a year through Reuter to existing Chambers customers
using the Reuter facility since Chambers cannot offer long-term
contracts until it builds its own facility.
Plaintiffs determined that allowing WMF to use the Reuter facility
to offer long-term contracts could seriously undermine competition.
without long-term use of a facility, Chambers cannot effectively
compete for long-term contracts. If WMF can do so, it will be able to
disadvantage Chambers and, ultimately, consumers by tying up most, if
not all, the customers in the market before Chambers can effectively
compete for customers using long-term contracts. To preserve the long-
term options of consumers while Chambers or other competitors establish
a long-term presence, Plaintiffs placed a limit on the length of
contract WMF could offer using the Reuter facility.
The limitation is narrowly drawn, however. First, the provision
applies only to existing customers of Chambers using the Reuter
facility. Second, the provision does not preclude WMF from offering
long-term contracts to these customers if it uses any facility other
than the Reuter Transfer Station to accept the waste. Third, it does
not preclude WMF from competing with Chambers for these customers using
short-term contracts. In effect, this provision prevents WMF from
committing customers to long-term contracts through the use of Reuter
while Chambers is unable to offer similar contracts. However, the
protection is limited by WMF's ability to continue to compete for these
customers using either other sites or short-term contracts. The
provision does not affect competition between Chambers and Dade County
in any way.
D. Defendants' Obligations of Noninterference and Assistance
Obtaining permits and other governmental approvals constitute the
largest barrier to entry into the municipal solid waste disposal market
in the relevant geographic area. Section VII of the proposed Final
Judgment prohibits any interference, directly or indirectly, by
Defendants, including any action to protest, lobby against, object to,
or otherwise impede any attempts by Chambers to lease, purchase, site,
obtain appropriate zoning for, obtain permits and any and all other
governmental approvals for a solid waste transfer station capable of
serving the relevant market. It also prohibits Defendants from
providing financing or other assistance to any person who does so.
Finally, it obligates Defendants to cooperate with Chambers' efforts to
obtain government permits and approvals on the property subject to the
Option Agreement.
E. Acquisition of Optioned Property
Section VIII of the proposed Final Judgment prohibits Defendants
from reacquiring the property subject to the Option Agreement from
Chambers or its successors or assigns without the prior written consent
of the United States, after consultation with Florida, for the life of
the proposed Final Judgment.
F. Reporting and Access
Section IX of the proposed Final Judgment establishes standards and
procedures by which the Department of Justice and Florida may obtain
access to documents and information from Defendants related to its
compliance with the Final Judgment.
G. Duration
Section X of the proposed Final Judgment provides that the Final
Judgment will expire on the tenth year after its entry. Jurisdiction
will be retained by the Court to conduct further proceedings relating
to the Final Judgment, as specified in Section IX.
IV
Remedies Available to Potential Private Litigants
Section 4 of the Clayton Act (15 U.S.C. Sec. 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
attorneys' 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 defendants.
V
Procedures Available for Modification of the Proposed Final Judgment
The United States, Florida, and Defendants have stipulated that the
proposed Final Judgment may be entered by the Court after compliance
with the provisions of the APPA, provided that Plaintiffs have not
withdrawn their 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 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 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: Anthony V. Nanni, Chief,
Litigation I Section, 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
Defendants. It also considered the possibility of requiring WMF to
divest itself of the transfer
[[Page 55739]]
station buildings and related appurtenances before permitting it to
acquire Reuter. The United States is satisfied, however, that the
relief outlined in the proposed Final Judgment will eliminate WMF's
ability to constrain prices or output by eliminating a competitor from
the solid waste disposal market in the relevant geographic market. The
relief obtained will maintain the competition in the market by creating
an essentially independent transfer station for five years and also by
providing property upon which an independent transfer station can be
constructed to be in operation for the indefinite future. The relief
sought eliminates anticompetitive effects in the short term by
essentially maintaining the status quo. It preserves competition in the
long term by providing time to build and by facilitating the
construction of an additional competitive transfer station.
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-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 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, 1462 (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.'' \6\ Rather,
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.
\6\ 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. Sec. 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. & Ad. News 6535, 6538.
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United States v. Mid-America Dairymen, Inc., 1977-1 Trade Cas.
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 Cir.), cert. denied, 454 U.S. 1083
(1981); see also Microsoft, 56 F.3d at 1460. 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.\7\
\7\ 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 United States v. American Cyanamid Co., 719
F.2d at 565.
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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).'' \8\
\8\ 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).
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VIII
Determinative Documents
In formulating the proposed Final Judgment, the United States
considered the following determinative materials or documents within
the meaning of the APPA: the Transfer Station Agreement attached to the
proposed Final Judgment as Exhibit A; the Amendment to Transfer Station
Agreement attached to the proposed Final Judgment as Exhibit B; and the
Option Agreement attached to the proposed Final Judgment as Exhibit C.
Dated: October 20, 1995.
Respectfully submitted,
Nancy H. McMillen,
Attorney, Antitrust Division, U.S. Department of Justice, 1401 H
Street, N.W., Suite 4000, Washington, D.C. 20530, (202) 307-5777.
Certification of Service
I hereby certify that a copy of the foregoing has been served upon
Waste Management, Inc. of Florida and Reuter Recycling of Florida,
Inc., by placing a copy of this Competitive Impact Statement in the
U.S. mail, directed to each of the above named parties at the addresses
given below, this 20th day of October, 1995.
Michael Sennett, Esquire,
Bell, Boyd & Lloyd, 3 First National Plaza, 70 West Madison Street,
Chicago, IL 60602.
Andrew N. Cook, Esquire,
Bell, Boyd & Lloyd, 1615 L Street, N.W., Washington, D.C. 20036.
John H. Korns,
Oppenheimer, Wolff & Donnelly, 1020 19th Street, N.W., Suite 400,
Washington, D.C. 20036.
Office of the Attorney General, State of Florida, The Capitol,
Tallahassee, Florida 32399-1050.
Nancy H. McMillen,
Attorney, U.S. Department of Justice, Antitrust Division, 1401 H.
Street, N.W., Suite 4000, Washington, D.C. 20530, (202) 307-5777.
[FR Doc. 95-27060 Filed 11-1-95; 8:45 am]
BILLING CODE 4410-01-M
