[Federal Register Volume 62, Number 122 (Wednesday, June 25, 1997)]
[Notices]
[Pages 34305-34310]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-16593]
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DEPARTMENT OF JUSTICE
Antitrust Division
U.S. v. Seminole Fertilizer Corporation; 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 been filed with the
United States District Court for the Middle District of Florida in
United States of America v. Seminole Fertilizer Corporation, Civil No.
97-1507-CIV-T-17E.
The Complaint in the case alleges that Seminole restrained trade by
entering into a secret bidding agreement with its chief rival for the
purchase of an ammonia storage facility located in Tampa, Florida. The
Complaint alleges that the agreement had the effect of eliminating
Seminole as a viable competing bidder.
In the proposed Final Judgment, Seminole agrees not to enter into
agreements with others illegally setting the price of fertilizer
assets. Seminole also agrees not to submit joint bids for fertilizer
assets without first notifying the seller of the asset and the person
administering the sale of the asset that the bid has been jointly
prepared.
Public Comments on the proposed Final Judgment is invited within
the statutory 60-day comment period. Such comments and responses
thereto will be published in the Federal Register and filed with the
Court. Comments should be directed to John T. Orr, Chief, Atlanta Field
Office, Antitrust Division, Department of Justice, Suite 1176, Richard
B. Russell Federal Building, 75 Spring Street, S.W., Atlanta, Georgia
30303 (telephone: 404-331-7100).
Rebecca P. Dick,
Deputy Director of Operations, Antitrust Division.
Stipulation
Judge Elizabeth A. Kovachevich
It is stipulated by and between the undersigned parties that:
1. The Court has jurisdiction over the subject matter of this
action and over each of the parties thereto, and venue of this action
is proper in the Middle District of Florida, Tampa Division;
[[Page 34306]]
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), 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 Defendant and by filing that
notice with the Court;
3. In the event Plaintiff withdraws its 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; and
4. This Stipulation and the Final Judgment to which it relates are
for settlement purposes only and do not constitute an admission by
Defendant in this or any other proceeding; that Section 1 of the
Sherman Act, 15 U.S.C. 1, or any other provision of law, has been
violated.
This 18th day of June, 1997.
Gary R. Trombley,
Attorney for Defendant, Trombley & Associates, P.A., P.O. Box 3356,
Tampa, Florida 33601, (813) 229-7918.
Karen E. Sampson,
Belinda A. Barnett,
Attorneys for Plaintiff, U.S. Department of Justice, Antitrust
Division, 75 Spring Street, S.W., Suite 1176, Atlanta, Georgia 30303,
(404) 331-7100.
Final Judgment
Judge Elizabeth A. Kovachevich
Whereas plaintiff, United States of America, having filed its
Complaint in this action on June 18, 1997, and plaintiff and defendant,
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 against,
or any admission by, any party with respect to any such issue of fact
or law.
And whereas defendant has agreed to be bound by the provisions of
this Final Judgment pending its approval by the Court.
Now, therefore, before any testimony is taken, and without trial or
adjudication of any issue of fact or law, and upon the consent of the
parties,
It is hereby ordered, adjudged and decreed as follows:
I
Jurisdiction
This Court has jurisdiction over the subject matter of this action,
and over the person of the defendant, Seminole Fertilizer Corporation.
The Complaint states a claim upon which relief may be granted against
the defendant under Section 1 of the Sherman Act (15 U.S.C. 1).
II
Definitions
As used in this Final Judgment:
A. ``Defendant'' means Seminole Fertilizer Corporation and its
affiliates, parents, subsidiaries, successors and assigns, directors,
officers, managers, agents, and employees engaged in the fertilizer
business, and any other person acting for or on behalf of them with
respect to the fertilizer business.
B. ``Fertilizer asset'' means any asset used principally in the
manufacture, processing, production, storage, distribution, or sale of
fertilizer or ammonia.
C. ``Fertilizer business'' means the manufacturing, processing,
production, storage, distribution, or sale of fertilizer or ammonia.
D. ``Jointly determined bid'' or ``joint bid'' means any combining,
pooling, or supplementing of resources, money, or property in
connection with an actual or proposed offer for property which is to be
sold through a bid process.
E. ``Person'' means any individual, association, cooperative,
partnership, corporation, or other business or legal entity.
III
Applicability
This Final Judgment shall apply to defendant, including each of its
directors, officers, managers, agents, employees, affiliates, parents,
subsidiaries, and successors and assigns engaged now or in the future
in the fertilizer business, and to all other persons in active concert
or participation with defendant in the fertilizer business who shall
have received actual notice of this Final Judgment by personal service
or otherwise.
IV
Prohibited Conduct
Defendant is enjoined and restrained from:
A. Directly, indirectly, or through any joint venture, partnership,
or other device, entering into, attempting to enter into, organizing or
attempting to organize, implementing or attempting to implement, or
soliciting any agreement, understanding, contract, or combination,
either express or implied, with any other person:
1. To submit any jointly determined bids for the acquisition of any
fertilizer asset located in the United States; or
2. To illegally set or establish the price or other terms and
conditions of any bids for the acquisition of any fertilizer asset
located in the United States;
B. Directly, indirectly, or through any joint venture, partnership,
or other device, communicating or inquiring about any intentions,
decisions, or plans to refrain from bidding or to bid, including any
intentions, decisions, or plans regarding any actual or proposed bid
amounts, for the acquisition of any fertilizer asset located in the
United States, where such communication or inquiry is to:
1. Any other person that is known or reasonably should be known by
defendant to be a potential bidder on the sale of that fertilizer
asset; or
2. Any other person that has announced an intention to bid on the
sale of that fertilizer asset; and
C. Directly, indirectly, or through any joint venture, partnership,
or other device, requesting, suggesting, urging, or advocating that any
other person not bid on, or suggesting that it would not be profitable,
desirable, or appropriate for any other person to bid on, the sale of
any fertilizer asset located in the United States.
V
Limiting Conditions
A. Nothing in Section IV (A) and (B) shall prohibit defendant from
entering an agreement, understanding, contract, or combination with any
other person to submit any jointly determined bids for the acquisition
of any fertilizer asset located in the United States so long as the
purpose or effect is not to eliminate or suppress competition and where
before or at the time of submitting any such jointly determined bids,
defendant:
1. Discloses to the seller of the asset and the person
administering the sale of the asset that a jointly determined bid is
being submitted, the nature of the joint bid arrangement, and with whom
the joint bid is being submitted; and
2. Does not, without disclosing to the seller in advance of the
sale, violate any of the terms or conditions for bidding imposed by the
seller of the asset or violate any of the terms or conditions for
bidding imposed by the person administering the sale of the asset.
B. Section IV (B) and (C) shall not apply to communications to
[[Page 34307]]
shareholders, potential purchasers of substantially all of the
defendant's stock or assets, lenders, creditors, or subcontractors, who
are not competitors, where such communications are limited to the
context of such relationship.
VI
Notification
Defendant currently is not engaged in the fertilizer business. If
defendant re-enters and engages in the fertilizer business at any time
during the term of this Final Judgment, then within thirty (30) days of
such re-entry, defendant shall cause to be delivered, by certified
letter or its equivalent, a copy of this Final Judgment to all persons
with whom defendant then is engaged in a partnership, joint venture, or
other similar relation in the fertilizer business, and to all persons
with whom defendant then is engaged in discussions or negotiations
regarding the possible submission of a joint bid for the acquisition of
any fertilizer asset.
VII
Compliance
A. In view of the fact that defendant is not currently engaged in
the fertilizer business, all of defendant's compliance obligations
under Section VII of this Final Judgment are suspended until such time
as defendant re-enters and engages in the fertilizer business during
the term of this Final Judgment.
B. If and when defendant re-enters the fertilizer business during
the term of this Final Judgment, within thirty (30) days of re-entry
defendant is ordered to establish and maintain for as long as it
engages in the fertilizer business an antitrust compliance program
which shall include designating an Antitrust Compliance Officer with
responsibility for accomplishing the antitrust compliance program and
with the purpose of achieving compliance with this Final Judgment. The
Antitrust Compliance Officer shall, on a continuing basis, supervise
the review of the current and proposed activities of the defendant to
ensure that it complies with this Final Judgment. The Antitrust
Compliance Officer shall be responsible for accomplishing the following
activities:
1. Distributing, within ninety (90) days of the date of defendant's
re-entry in the fertilizer business, a copy of this Final Judgment to
all officers and directors, and any person who otherwise manages
defendant with respect to the fertilizer business;
2. Distributing in a timely manner a copy of this Final Judgment to
any person who succeeds to a position described in Section VII (B)(1);
3. Briefing annually defendant's officers and directors engaged in
the fertilizer business on the meaning and requirements of this Final
Judgment and the antitrust laws;
4. Obtaining annually from each officer or employee designated in
Section VII(B)(1) and (2) a written certification that he or she: (a)
Has read, understands, and agrees to abide by the term of this Final
Judgment; (b) understands that failure to comply with this Final
Judgment may result in conviction for criminal contempt of court; and
(c) is not aware of any violation of the Final Judgment that has not
been reported to the Antitrust Compliance Officer;
5. Maintaining a record of recipients from whom the certification
required by Section VII(B)(4) has been obtained; and
6. Distributing in a timely manner, and in all cases before
entering any agreement, understanding, contract, or combination to
submit a joint bid and before making the notification to the required
parties under Section V, above, a copy of this Final Judgment to any
person with whom the defendant enters into discussions or negotiations
for the possible submission of a joint bid for the acquisition of any
fertilizer asset.
C. Defendant is also ordered to file with this Court and serve upon
plaintiff, within ninety (90) days after the date of defendant's re-
entry in the fertilizer business, an affidavit as to the fact and
manner of its compliance with this Final Judgment.
D. If defendant's Antitrust Compliance Officer learns of any
violations of this Final Judgment, defendant shall forthwith take
appropriate action to terminate or modify the activity so as to assure
compliance with this Final Judgment.
VIII
Plaintiff Access
A. For the purpose of determining or securing compliance with this
Final Judgment, and subject to any legally recognized privilege, duly
authorized representatives of the plaintiff shall, upon written request
by the Assistant Attorney General in charge of the Antitrust Division,
and on reasonable notice to the defendant, be permitted:
1. Access during the defendant's office hours to inspect and copy
all records and documents in its possession or control relating to the
fertilizer business specifically described in this Final Judgment; and
2. Subject to the reasonable convenience of defendant and without
restraint or interference from defendant, to interview the defendant's
officers, employees, or agents engaged in the fertilizer business, who
may have counsel present, regarding the defendant's fertilizer
business.
B. Upon written request by the Assistant Attorney General in charge
of the Antitrust Division, the defendant shall submit such written
reports, under oath if requested, relating to the fertilizer business
concerning matters contained in this Final Judgment as may be
requested, subject to any legally recognized privilege.
C. No information or documents obtained by the means provided in
this Section VIII shall be divulged by the 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, 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
defendant to plaintiff, defendant represents and identifies 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 the defendant marks each pertinent page of such
material, ``Subject to claim of protection under Rule 26(c)(7) of the
Federal Rules of Civil Procedure,'' then 20 days' notice shall be given
by plaintiff to defendant prior to divulging such material in any legal
proceeding (other than a grand jury proceeding) to which that defendant
is not a party.
IX
Retention of Jurisdiction
Jurisdiction is retained by this Court for the purpose of enabling
either 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 to carry out or construe this Final Judgment, to modify or
terminate any of its provisions, to enforce compliance herewith, and to
punish any violations of its provisions. Nothing in this provision
shall give standing to any person not a party to this Final Judgment to
seek any relief related to it.
X
Term
This Final Judgment will expire on the tenth anniversary of its
date of entry.
[[Page 34308]]
XI
Public Interest
Entry of this Final Judgment is in the public interest.
Dated: ______
Court approval subject to the Antitrust Procedures and Penalties
Act, 15 U.S.C. 16.
United States District Judge
Competitive Impact Statement
Judge Elizabeth A. Kovachevich
Pursuant to Section 2(b) of the Antitrust Procedures and Penalties
Act, 15 U.S.C. 16(b)-(h), the United States submits this Competitive
Impact Statement relating to the proposed Final Judgment submitted for
entry with the consent of Seminole Fertilizer Corporation in this civil
antitrust proceeding.
I
Nature and Purpose of the Proceeding
On June 18, 1997 the United States filed a civil antitrust
complaint alleging that defendant and others conspired unreasonably to
restrain competition in violation of Section 1 of the Sherman Act, 15
U.S.C. 1. The Complaint alleges that defendant, Norsk Hydro USA Inc.
(``Norsk USA''), and Farmland Industries, Inc. (``Farmland'') met on
March 5, 1992, and discussed sharing pipeline capacity and the cost of
bidding on an ammonia tank and pipeline interest, hereinafter referred
to as the Tampa Facility. At the conclusion of the meeting, defendant,
Norsk USA, and Farmland reached a tentative agreement, which was later
reduced to writing. The Complaint also alleges that on March 9 and
March 10, 1992, defendant and Norsk USA discussed the terms of the
agreement by telephone on several occasions and that they executed the
written agreement two hours before the scheduled auction of the Tampa
Facility on March 12, 1992. The agreement provided that defendant would
give bid support of up to $2.5 million to Norsk USA, if necessary, to
defeat a competing bid. In exchange, Norsk USA agreed to give defendant
increased pipeline capacity if Norsk USA was the successful bidder.
This agreement had the effect of eliminating defendant, Norsk USA's
chief rival, as a viable competing bidder for the Tampa Facility.
Almost immediately after signing the agreement, defendant stated that
it was no longer going to attend the auction of the Tampa Facility. At
the auction on the afternoon of March 12, there were no bids for the
Tampa Facility other than the one previously submitted by Norsk USA.
On ____, the United States and defendant filed a Stipulation by
which they consented to the entry of a proposed Final Judgment
following compliance with the Antitrust Procedures and Penalties Act,
15 U.S.C. 16(b)-(h). The proposed Final Judgment, as will be discussed
in detail in Section IV.A., would order defendant to refrain from
soliciting, entering, or attempting to enter any agreement to submit
any jointly determined bids for the acquisition of any fertilizer asset
(as defined in the Final Judgment) located in the United States with
any other person that is known or reasonably should be known to
defendant to be a potential bidder on the sale of that fertilizer
asset. The Final Judgment would also enjoin defendant from soliciting,
entering, or attempting to enter any agreement to set or establish the
price or other terms and conditions of any bids for the acquisition of
any fertilizer asset located in the United States.
II
Description of Defendant
Defendant, a wholly owned subsidiary of Tosco Corporation, sold all
of its assets in May 1993. Before its assets were sold, defendant
maintained its corporate offices in Stamford, Connecticut, and was a
manufacturer and distributor of phosphatic fertilizer. It operated
production and storage facilities in central Florida, near Tampa.
III
The Tampa Facility and Events Leading Up to the Alleged Violation
A. The Tampa Facility
The Tampa Facility, which consists of an ammonia terminal located
in the Port of Tampa, Florida, and a one-half interest in a pipeline
system connected to the ammonia terminal,\1\ is used for storing,
handling, and delivering anhydrous ammonia, one of the raw materials
used in the manufacture of phosphatic fertilizers. Located on
approximately 17\1/2\ acres of land leased from the Tampa Port
Authority, the Tampa Facility has a single tank with a 35,000 metric
ton storage capacity. It services five nearby phosphatic fertilizer
plants,\2\ where the ammonia is combined with phosphoric acid to create
diammonium phosphate. The Tampa Facility is able to service by truck or
rail other phosphatic fertilizer plants not connected to it. During the
early 1990's the Tampa Facility was owned by the Royster Company
(``Royster''), now known as Mulberry Phosphates, Inc. (``MPI'').
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\1\ Defendant owned the other one-half interest in the pipeline,
along with a separate ammonia terminal (consisting of two ammonia
tanks) that also was connected to the pipeline.
\2\ If defendant had been successful in acquiring the Tampa
Facility, it would have been the exclusive supplier to those five
plants.
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B. The Bankruptcy of Royster and the Failed Auction
Royster was a manufacturer of phosphatic fertilizers and related
products for the domestic and export markets. Its principal facilities
included a plant for the production of diammonium phosphate, located in
Mulberry, Florida, and the Tampa Facility. Royster filed for bankruptcy
protection on April 8, 1991, after months of experiencing financial
hardships. Under the reorganization plan submitted to the Bankruptcy
Court, Royster proposed to liquidate certain assets, including its
Tampa Facility. Shortly after news of the potential sale of the Tampa
Facility went public, Norsk USA and defendant separately expressed
interest in acquiring it. After extensive negotiations with Royster
officials, Norsk USA agreed to purchase the property for $15.5 million
and executed an asset purchase agreement for the property on September
25, 1991. The agreement guaranteed Royster the right to purchase a
continuing supply of ammonia from the terminal for its Mulberry plant
and contained a through-put provision that permitted it to put the
ammonia through the pipeline from the terminal to the plant. In
November of that same year, the Bankruptcy Court ordered that the Tampa
Facility be sold by auction and that bids be taken against Norsk USA's
offer of $15.5 million. The auction was scheduled for March 12, 1992.
It was not until the auction was announced that a third Company, CF
Industries (``CF''),\3\ publicly expressed any interest in acquiring
that Tampa Facility.
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\3\ CF is a cooperative which has been a major participant in
the fertilizer business since the mid-1960's and has operated world-
scale phosphatic fertilizer plants in Florida since 1969.
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On December 18, 1991, the Bankruptcy Court issued an order
approving bidding procedures in connection with the proposed sale of
the Tampa Facility. Any third party offer had to: (1) Be substantially
similar to the one contained in the Norsk USA Asset Purchase Agreement;
(2) be at least $1 million more than the Norsk USA offer of $15.5
million; (3) include an offer to enter into a through-put agreement
with Royster; and (4) include a confidentiality agreement with Royster
and Norsk USA regarding disclosure of the terms of the Royster/Norsk
USA
[[Page 34309]]
Through-put Agreement. In addition, the Order required that the third
party deposit $1 million in escrow no later than the time at which it
submitted an offer. The money deposited was to remain in escrow pending
the earlier of (a) the closing of the sale to the third party if its
offer was approved by the Bankruptcy Court or (b) the entry of an order
approving the sale of the Tampa Facility to either Norsk USA or another
third party bidder. After depositing the $1 million, the third party
was entitled to receive documents setting forth the results of the
inspection of the Tampa Facility's tank, the cost of repair, the terms
of the Royster/Norsk USA Through-put Agreement, and the terms of any
through-put agreements submitted by any other third parties.
In February 1992, CF deposited $1 million in escrow. Defendant made
its escrow deposit on March 9, 1992, three days before the auction. At
the time of the auction, there were four bidders who were qualified to
bid: Norsk USA, CF, defendant, and Superfos Investments Limited
(``Superfos'').\4\ CF informed Royster shortly before the auction that
it would not be bidding, because of environmental concerns raised by a
just-completed study it had done. Only Norsk USA appeared at the
auction site on the afternoon of March 12 to bid on the Tampa Facility.
There having been no new bids tendered, Norsk USA's standing offer of
$15.5 million was accepted, pending approval by the Bankruptcy Court.
In a meeting later that afternoon to finalize the details of the sale
before a March 13 court hearing, Royster representatives discovered
that Norsk USA and defendant had executed a joint bidding agreement
approximately two hours before the auction was scheduled to begin.
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\4\ Since Superfos was a major creditor of Royster, the
Bankruptcy Court exempted Superfos from the $1 million escrow
requirement and gave it permission to submit a credit bid. Thus,
Superfos could deduct from its bid offer the amount it was owed by
Royster.
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At the hearing the following day, Royster representatives advised
the Bankruptcy Court of the agreement between defendant and Norsk USA.
The Bankruptcy Court deferred ratification of the sale and ordered
discovery to be taken. A few days later, the Bankruptcy Court received
two anonymous communications regarding the bidding agreement. One
communication was a letter alleging that defendant had agreed to
backstop Norsk USA's bid and that defendant's bid supplement was leaked
to CF, causing them to withdraw. The letter pinpointed Steve Yurman,
defendant's president, as the villain in the alleged deal. The other
communication was one of defendant's internal memoranda written by
Yurman describing the terms of the March 12 agreement. After reviewing
the information obtained during discovery in light of the anonymous
correspondence, the Bankruptcy Court, at a hearing on March 20, refused
to ratify the sale of the Tampa Facility to Norsk USA and ordered that
a second auction be held. At the second auction, on June 17, 1992, CF
and Norsk USA submitted bids, and CF won the Tampa Facility with a
final bid of $21.6 million. (By the time of the second auction, CF had
been able to resolve its environmental concerns.)
C. Evidence of Collusion
On February 26, 1992, representatives of defendant, Norsk USA, and
Farmland met at the Rihga Royal Hotel in New York to discuss an alleged
``joint venture'' proposal by defendant. The proposal involved Norsk
USA buying the Tampa Facility and keeping the interest in the pipeline,
but possibly selling the tank to CF. The meeting concluded with no
agreements being reached.
The same parties met again on March 5, 1992, at the same hotel.
They primarily discussed sharing pipeline capacity and the cost of
bidding on the terminal. Specifically, Norsk USA, Farmland, and
defendant proposed that Norsk USA and defendant enter into an agreement
whereby defendant would supplement Norsk USA's bid and consent to
Royster's transfer of its pipeline interest to Norsk USA in return for
Norsk USA giving defendant extra pipeline capacity.\5\ A tentative
agreement was reached and Norsk USA indicated that it would have its
attorneys reduce the agreement to writing and send defendant a draft to
review. Norsk USA sent the first written draft to defendant on March 6,
and on March 9 and March 10 representatives of Norsk USA and defendant
discussed, via telephone on several occasions, the terms of the draft
agreement.
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\5\ As owner of the other one-half interest in the Tampa
Facility's pipeline lease, defendant already had the right to use
450,000 tons of the pipeline's 900,000 ton capacity.
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On the morning of March 12, officials of Farmland, Norsk USA,
Tosco, and defendant, along with their attorneys, met in Tampa,
Florida, at the law offices of MacFarlane Ferguson, Norsk USA's local
counsel, to resume negotiating the details of the proposed agreement.
After hours of negotiations, the parties agreed, in part, that (a)
defendant would supplement Norsk USA's bid up to $2.5 million and
consent to Royster's assignment of its one-half interest in the
pipeline lease to Norsk USA and (b) Norsk USA, in return, would give
defendant the right to use an extra 40,000 tons of the pipeline's
capacity. Almost immediately after signing the agreement, defendant
stated that it was no longer attending the auction.
One of defendant's representatives appeared at the auction moments
before it started and advised Royster that it was withdrawing from the
bidding. Later that evening, representatives of Norsk USA and defendant
talked by telephone and agreed to instruct their counsel to confer with
one another to prepare for the court hearing the next day.
In this case, there was virtually no evidence of covert activity,
which indicated that the subjects of the investigation were not aware
of, or did not appreciate, the full consequences of their actions. This
lack of covertness is one of the main reasons this case is being filed
civilly rather than criminally. See Antitrust Division Manual, Section
III.E., at III-12 (October 18, 1987) (Second Edition).
IV
Explanation of Proposed Final Judgment
A. Prohibited Conduct
Section IV. A. enjoins defendant from directly, indirectly, or
through any joint venture, partnership, or other device, entering into,
attempting to enter into, organizing or attempting to organize,
implementing or attempting to implement, or soliciting any agreement,
understanding, contract, or combination, either express or implied,
with any other person: (1) To submit any jointly determined bids for
the acquisition of any fertilizer asset located in the United States;
or (2) to illegally set or establish the price or other terms and
conditions of any bids for the acquisition of any fertilizer asset
located in the United States.
Paragraph B. of Section IV. also enjoins defendant from directly,
indirectly, or through any joint venture, partnership, or other device,
communicating or inquiring about any intentions, decisions, or plans to
refrain from bidding or to bid, including any intentions, decisions, or
plans regarding any actual or proposed bid amounts, for the acquisition
of any fertilizer asset located in the United States, where such
communication or inquiry is to (1) any other person that is known or
reasonably should be known by defendant to be a potential bidder on the
sale of that fertilizer asset or (2) any other person that has
announced an
[[Page 34310]]
intention to bid on the sale of that fertilizer asset.
Paragraph C. of Section IV. enjoins the defendant from directly,
indirectly, or through any joint venture, partnership, or other device,
requesting, suggesting, urging, or advocating that any other person not
bid on, or suggesting that it would not be profitable, desirable, or
appropriate for any other person to bid on, the sale of any fertilizer
asset located in the United States.
B. Compliance Program and Certification
The Final Judgment acknowledges that defendant currently is not
engaged in the fertilizer business and, as a result, suspends all of
defendant's compliance obligations under Section VII. of the Final
Judgment until such time as defendant re-enters and engages in the
fertilizer business during the term of the Final Judgment. If and when
defendant re-enters the fertilizer business during the term of the
Final Judgment, within thirty (30) days of re-entery defendant must
establish and maintain for as long as it engages in the fertilizer
business an antitrust compliance program which shall include
designating an Antitrust Compliance Officer with responsibility for
accomplishing the compliance program. The Antitrust Compliance Officer
is required to, on a continuing basis, supervise the review of the
current and proposed activities of the defendant to ensure that it is
in compliance with the program. The Antitrust Compliance Officer is
also required to (1) distribute a copy of the Final Judgment to all
officers and directors, and any person who otherwise manages defendant
with respect to the fertilizer business, (2) distribute in a timely
manner copy of the Final Judgment to any person who succeeds to a
position described in Section VII.B.1. of the Final Judgment, (3) brief
annually defendant's officers and directors engaged in the fertilizer
business on the meaning and requirements of the Final Judgment and the
antitrust laws, and (4) obtain annually from each officer or employee
designated in Section VII.B.1 and 2. of the Final Judgment a written
certification that he or she: (a) Has read, understands, and agrees to
abide by the terms of the Final Judgment; (b) understands that failure
to comply with the Final Judgment may result in conviction for criminal
contempt of court; and (c) is not aware of any violation of the Final
Judgment that has not been reported to the Antitrust Compliance
Officer.
Moreover, defendant is required to distribute in a timely manner a
copy of the Final Judgment to any person with whom the defendant enters
into discussions or negotiations for the possible submission of a joint
bid for the acquisition of any fertilizer asset and file with this
Court and serve upon plaintiff, within ninety (90) days after the date
of defendant's re-entry in the fertilizer business, an affidavit as to
the fact and manner of its compliance with this Final Judgment.
Defendant is also required to take appropriate action to terminate or
modify any activities it uncovers that violate any provision of the
Final Judgment.
V
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 being 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 actions under
the Clayton Act. 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 private lawsuit that may be brought against the
defendant.
VI
Procedures Available for Modification of the Proposed Final Judgment
As provided by the Antitrust Procedures and Penalties Act, any
person believing that the proposed Final Judgment should be modified
may submit written comments to John T. Orr, Chief, Atlanta Field
Office, U.S. Department of Justice, Antitrust Division, 75 Spring
Street, S.W., Suite 1176, Atlanta, Georgia, 30303, within the 60-day
period provided by the Act. These comments, and the Department's
responses, will be filed with the Court and published in the Federal
Register. 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.
VII
Alternative to the Proposed Final Judgment
The Department considered, as an alternative to the proposed Final
Judgment, litigation seeking comparable equitable relief. In the view
of the Department of Justice, a trial would involve substantial cost to
the United States and is not warranted because the Proposed Judgment
provides relief that will remedy the violations of the Sherman Act
alleged in the Complaint of the United States.
VIII
Determinative Materials and Documents
No materials and documents described in Section 2(b) of the
Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b), were used in
formulating the proposed Final Judgment.
Date: ______
Respectfully submitted,
Karen E. Sampson,
Belinda A. Barnett,
Attorneys for Plaintiff, U.S. Department of Justice, Antitrust
Division, 75 Spring Street, S.W., Suite 1176, Atlanta, Georgia 30303,
(404) 331-7100.
[FR Doc. 97-16593 Filed 6-24-97; 8:45 am]
BILLING CODE 4410-11-M
