United States v. International Association of Machinists and Aerospace Workers, et al.; Proposed Final Judgment and Competitive Impact Statement

DEPARTMENT OF JUSTICE

Antitrust Division

United States v. International Association of Machinists and

Aerospace Workers, et al.; Proposed Final Judgment and Competitive

Impact Statement

Notice is hereby given pursuant to the Antitrust Procedures and

Penalties Act, 15 U.S.C. section 16 (b) through (h), that a proposed

Final Judgment, Stipulation and Competitive Impact Statement have been

filed with the United States District Court for the District of

Columbia, in United States v. International Association of Machinists

and Aerospace Workers, et al., Civil Action No. 94-0690. The Complaint

in this case alleged that the International Association of Machinists

and Aerospace Workers (``IAM'') and three individuals, Tom Ducy,

William O'Driscoll and William Winpisinger, had violated Section 8 of

the Clayton Act. Section 8 prohibits the same person from serving as an

officer or director of two competing companies. The Complaint alleged

that the IAM served on the boards of two competing airlines Northwest

Airlines Corporation and Trans World Airlines, Inc., through its

representatives, the three individual defendants.

On March 30, 1994, the United States and the defendants filed a

Stipulation in which they consented to the entry of a proposed Final

Judgment providing the relief the United States seeks in the Complaint.

The proposed Final Judgment enjoins the IAM and the individual

defendants from conduct that would facilitate coordination between

competing airlines or that would facilitate the exchange of

confidential information between the two carriers. The proposed final

judgment prohibits the IAM board representatives from disclosing

confidential information to IAM representatives on the boards of other

airlines or to any other person not employed by the airline on whose

board they sit. The IAM representatives are also enjoined from entering

into or soliciting agreements in violation of the antitrust laws with

IAM representatives on the boards of other carriers and from engaging

in communications with other IAM representatives with the purpose or

effect of reducing competition between the two airlines. Furthermore,

the proposed Final Judgment enjoins the IAM from acting as a conduit

for exchanges of confidential information and provides that the IAM

shall require future board representatives to agree to be bound by the

terms of the proposed Final Judgment.

Public comment 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 Roger W. Fones, Chief, Transportation, Energy and Agriculture

Section, Antitrust Division, Department of Justice, room 9104, 555

Fourth Street NW., Washington, DC 20001, (telephone: 202-307-6351).

Constance K. Robinson,

Director of Operations, Antitrust Division.

Stipulation

Civil Action No.: 940690.

Filed: March 30, 1994.

Judge Richey.

United States of America, Plaintiff, v. International

Association of Machinists and Aerospace Workers, et al., Defendants.

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 thereto, 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 motion of any

party or upon the Court's own motion, at any time after compliance with

the requirements of the Antitrust Procedures and Penalties Act (15

U.S.C. 16), and without further notice to any party or other

proceedings, provided that Plaintiff has not withdrawn its consent,

which it may do at any time before the entry of the Proposed Final

Judgment by serving notice thereof on Defendants and by filing that

notice with the Court;

3. 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 whatever, and the making of this

Stipulation shall without prejudice to any party in this or any other

proceeding.

Dated: March 30, 1994.

For Plaintiff United States of America:

Anne K. Bingaman,

Assistant Attorney General

Steven C. Sunshine,

Constance K. Robinson,

Roger W. Fones,

Mary Jean Moltenbrey,

Attorneys, U.S. Department of Justice.

Michael D. Billiel,

DC Bar #394377,

Attorney, U.S. Department of Justice, Antitrust Division, 555 Fourth

Street, NW., room 9104, Washington, DC 20001, (202) 307-6666.

For Defendants International Association of Machinists and

Aerospace Workers, Tom Ducy, William O'Driscoll, and William W.

Winpinsinger:

Allison Beck,

General Counsel, International Association of Machinists and

Aerospace Workers, 9000 Machinists Place, Upper Marlboro, MD 20772.

Final Judgment

Plaintiff, United States of America, filed its Complaint on March

30, 1994. Plaintiff and defendants, by their respective attorneys, have

consented to the entry of the Final Judgment without trial or

adjudication of any issue of fact or law. This Final Judgment shall not

be evidence against or an admission by any party with respect to any

issue of fact or law. Therefore, before the taking of any testimony and

without trial or adjudication of any issue of fact or law herein, and

upon consent of the parties, it is hereby

Ordered, Adjudged, and Decreed, as follows:

I

Jurisdiction

This Court has jurisdiction of the subject matter of this action

and of each of the parties consenting hereto. The Complaint states a

claim upon which relief may be granted against the defendants under

section 8 of the Clayton Act, 15 U.S.C. 19.

II

Definitions

As used herein, the term:

(A) Airline means any scheduled air passenger carrier as defined in

49 U.S.C. 1301(3) or 1301(22);

(B) Confidential Information means non-public information relating

to an airline's costs, performance, service, operations, pricing,

marketing, scheduling, equipment purchasing, route selection decisions

or plans, or any other commercial decisions, learned by virtue of an

IAM Board Representative's service on the board of directors of an

airline.

(C) Grand Lodge means the Grand Lodge of the International

Association of Machinists and Aerospace Workers, AFL-CIO, and all

directors, officers, employees, members, agents, consultants,

representatives, or other persons acting for or on behalf of any of

them;

(D) IAM means the International Association of Machinists and

Aerospace Workers, AFL-CIO each of its divisions and subdivisions,

including Districts and Locals, subsidiaries, and affiliates, each

other person directly or indirectly, wholly or in part, owned or

controlled by it, and all directors, officers, employees, members,

agents, consultants, representatives, or other persons acting for or on

behalf of any of them;

(E) IAM Board Representative means an individual who the IAM

nominates or appoints to, or who represents the IAM on, the board of

directors of any airline;

(F) Information Relating to Labor Relations means all information

required to fulfill the IAM's duty of fair representation relating to

wages, hours, benefits, grievances, strikes, organizing efforts, past

practices, and other terms and conditions of employment for any

employee represented by the IAM pursuant to the Railway Labor Act (45

U.S.C. 151, et seq.);

(G) Person means any natural person, corporation, firm, company,

sole proprietorship, partnership, association, institution,

governmental unit, labor union, or other legal entity; and

(H) Relating to means concerning, pertaining to, referring to, or

relevant to.

III

Applicability

(A) This Final Judgment applies to the defendants and to each of

their successors, assigns, and to all other persons in active concert

or participation with any of them who shall have received actual notice

of the Final Judgment by personal service or otherwise.

(B) Nothing herein contained shall suggest that any portion of 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

Prohibited Conduct

1. Defendant IAM shall require any IAM Board Representative to

refrain from:

(A) Engaging, directly or indirectly, in any communications of

Confidential Information with any IAM Board Representative on the board

of directors of any other airline;

(B) Disclosing, directly or indirectly, any Confidential

Information of the airline of which he or she is a director to any

person who is not employed by such airline;

(C) Voluntarily receiving, directly or indirectly, any Confidential

Information (except Information Relating to Labor Relations) from the

IAM relating to any other airline;

(D) Agreeing with (or soliciting an agreement by) any other IAM

Board Representative serving on the board of directors of any other

airline that their respective airlines would reduce or eliminate actual

or potential competition between them in violation of sections 1 or 2

of the Sherman Act (15 U.S.C. 1-2)--including any agreement,

understanding, or solicitation of an agreement to:

(i) Increase any current fare;

(ii) Refrain from decreasing any current fare;

(iii) Set the amount, duration or restrictions of any future fare;

(iv) Eliminate, reduce, or narrow any current fare, including any

promotion or discount fare;

(v) Refrain from introducing or extending any promotion or discount

fare;

(vi) Reduce or refrain from advertising any service or fare;

(vii) Reduce flight schedules, frequency, or capacity;

(viii) Eliminate or reduce existing service;

(ix) Refrain from establishing any service; or

(x) Limit, set the price of, or refrain from providing any service

to any other airline, including gates, ticketing, facilities, or ground

handling.

on any route or for any service for which the two airlines are actual

or potential competitors.

(E) Engaging directly in any communications with any IAM Board

Representative on the board of directors of any other airline with the

purpose or effect of:

(i) Increasing any current fare;

(ii) Decreasing any current fare;

(iii) Affecting any future fare;

(iv) Eliminating, reducing, or narrowing any current fare,

including any promotion or discount fare;

(v) Introducing or extending any promotion or discount fare; or

(vi) Reducing or refraining from advertising of any service or

fare.

on any route or for any service for which the two airlines are actual

or potential competitors.

(F) Engaging directly in any communications with any IAM Board

Representative on the board of directors of any other airline with the

purpose or effect of:

(i) Eliminating or reducing flight frequency or capacity;

(ii) Eliminating or reducing existing service;

(iii) Establishing any service; or

(iv) Limiting, withholding or pricing services provided to any

other airline, including gates, ticketing, facilities, and ground

handling,

on any route or for any service for which the two airlines are actual

or potential competitors, provided however that this paragraph does not

prohibit communications that the defendant establishes are primarily

Information Relating to Labor Relations.

2. Defendants Tom Ducy, William O'Driscoll and William Winpinsinger

are enjoined and restrained from doing anything prohibited by this

Final Judgment, including prohibitions 1(A)-(F) above.

3. The Grand Lodge is enjoined and restrained from:

(A) Nominating or appointing as an IAM Board Representative, any

person unless such person certifies in writing that he or she agrees to

be bound by the terms of this Final Judgment, including prohibitions

1(A)-(F) above;

(B) Nominating or appointing as an IAM Board Representative any

person who is an active official or employee of a District Lodge or

Local Lodge which already has another active official or employee

serving as an IAM Board Representative on the board of another airline;

(C) Disclosing, directly or indirectly, any Confidential

Information (except Information Relating to Labor Relations) obtained,

directly or indirectly, from any IAM Board Representative serving on

the board of directors of an airline to any person who is not employed

by that airline;

(D) Diclosing, directly or indirectly, any Confidential Information

(except Information Relating to Labor Relations) obtained, directly or

indirectly, from any IAM Board Representative to any other IAM Board

Representative on the board of directors of any other airline.

V

Compliance Program

(A) The Grand Lodge is ordered to maintain an antitrust compliance

program, which shall include designating, within 30 days of entry of

this Final Judgment, 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 Grand Lodge to

ensure that it complies with this Final Judgment. The Antitrust

Compliance Officer shall be responsible from the date of entry of this

Final Judgment for accomplishing the following activities:

(1) Distributing, within 60 days from the entry of this Final

Judgment, a copy of this Final Judgment to all officers of the IAM;

(2) Distributing in a timely manner a copy of this Final Judgment

to any officer who succeeds to a position described in Section V(A)(1);

(3) Obtaining from each officer of the Grand Lodge an annual

written certification that he or she:

(1) Has read, understands, and agrees to abide by the terms of this

Final Judgment; and

(2) Has been advised and understands that his or her failure to

comply with this Final Judgment may result in conviction for criminal

contempt of court.

(4) Maintaining a record of recipients to whom the Final Judgment

has been distributed and from whom the certification in section V(A)(3)

has been obtained.

(B) The Antitrust Compliance Officer shall be responsible for

distributing a copy of the Final Judgment to any person nominated or

appointed by the Grand Lodge as an IAM Board Representative, and

obtaining from such person a written certification that he or she:

(1) Has read, understands, and agrees to abide by the terms of this

Final Judgment; and

(2) Has been advised and understands that his or her failure to

comply with this Final Judgment may result in conviction for criminal

contempt of court.

VI

Certification

(A) Within 75 days after the entry of this Final Judgment, the

Grand Lodge shall certify to the plaintiff whether it has designated an

Antitrust Compliance Officer and has distributed the Final Judgment in

accordance with section V above.

(B) For four years after the entry of this Final Judgment, on or

before its anniversary date, the Grand Lodge shall file with the

plaintiff a statement as to the fact and manner of its compliance with

the provisions of of section V(A).

VII

Plaintiff Access

(A) To determine or secure compliance with this Final Judgment and

for no other purpose, duly authorized representatives of the plaintiff

shall, upon written request of the Assistant Attorney General in charge

of the Antitrust Division, and on reasonable notice to any defendant

made to its principal office, be permitted, subject to any legally

recognized privilege:

(1) Access during such defendant's office hours to inspect and copy

all documents in the possession or under the control of such defendant,

who may have counsel present, relating to any matters contained in this

Final Judgment; and

(2) Subject to the reasonable convenience of such defendant and

without restraint or interference from it, to interview officers,

employees or agents of such defendant, who may have counsel present,

regarding such matters.

(B) Upon the written request of the Assistant Attorney General in

charge of the Antitrust Division made to any defendant's principal

office, such defendant shall submit such written reports, under oath if

requested, relating to any matters contained in this Final Judgment as

may be reasonably requested, subject to any legally recognized

privilege.

(C) No information or documents obtained by the means provided in

section VII 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.

VIII

Further Elements of the Final Judgment

(A) Jurisdiction is retained by this Court for the purpose of

enabling any of the parties to this Final Judgment to apply to this

Court at any time for 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.

(B) This Final Judgment shall terminate ninety (90) days after the

Grand Lodge or any District or Local Lodge ceases to have the right to

have an IAM Board Representative on the boards of directors of more

than one airline.

(C) Entry of this Final Judgment is in the public interest.

Certificate of Service

I hereby certify that I have caused a copy of the foregoing

proposed Final Judgment to be served on counsel for defendants in this

matter in the manner set forth below:

By first class mail, postage prepaid: Allison Beck, General

Counsel, International Association of Machinists and Aerospace Workers,

9000 Machinists Place, Upper Marlboro, MD 20772. For defendants

International Association of Machinists and Aerospace Workers, Tom

Ducy, William O'Driscoll, and William W. Winpisinger.

Dated: March 30, 1994.

Michael D. Billiel,

DC Bar #394377, Antitrust Division, U.S. Department of Justice, 555

Fourth Street, NW., Washington, DC 20001, (202) 307-6666.

Competitive Impact Statement

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 defendants International Association of

Machinists and Aerospace Workers, Tom Ducy, William O'Driscoll, and

William Winpisinger, in this civil antitrust proceeding.

I

Nature and Purpose of the Proceeding

On March 30, 1994, the United States filed a civil antitrust

complaint alleging that the International Association of Machinists and

Aerospace Workers (``IAM'') and the three individual defendants, who

serve as the IAM's representatives on the boards of Northwest Airlines

Corporation (``Northwest'') and Trans World Airlines, Inc. (``TWA''),

had violated section 8 of the Clayton Act, 15 U.S.C. 19. Section 8 bars

the same person from serving as an officer or director of two competing

companies.\1\

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\1\Section 8 provides in relevant part: ``No person shall, at

the same time, serve as a director or officer in any two

corporations * * * that are (A) engaged in whole or in part in

commerce; and (B) by virtue of their business and location of

operation, competitors, so that the elimination of competition by

agreement between them would constitute a violation of any of the

antitrust laws.'' 15 U.S.C. 19(a)(1). The term ``person'' includes

corporations and associations. 15 U.S.C. 12.

---------------------------------------------------------------------------

The Complaint alleges that the IAM serves as a director of both

Northwest and TWA through its representatives, the three individual

defendants. Pursuant to agreements entered into with the two airlines

in 1993, the international president of the IAM appointed Tom Ducy,

former general secretary and treasurer of the IAM, to the Northwest

board of directors and William O'Driscoll, the current president of IAM

District 142, and William W. Winpisinger, the former president of the

IAM, to the TWA board of directors. The Complaint seeks relief that

will prevent the defendants from continuing to violate section 8.

On March 30, 1994, the United States and the defendants filed a

Stipulation in which they consented to the entry of the proposed Final

Judgment that provides the relief the United States seeks in the

Complaint. Under the proposed Final Judgment, the defendants will be

prohibited from exchanging confidential information or from engaging in

communications that could facilitate anticompetitive coordination

between TWA and Northwest. The proposed Final Judgment would also

prevent anticompetitive coordination between or among other airlines

that in the future have IAM representatives on their boards of

directors. The IAM will further be required to institute a compliance

program to ensure that it does not renew the alleged violation.

Additionally, the proposed Final Judgment requires that the IAM file

annual reports with the Government certifying that it has complied with

section V(A) of the Final Judgment.

The United States and the defendants have stipulated that the Court

may enter the proposed Final Judgment after compliance with the

Antitrust Procedures and Penalties Act, 15 U.S.C. 16 (b)-(h), provided

that the United States has not withdrawn its consent. The proposed

Final Judgment provides that its entry does not constitute any evidence

against or admission by any party with respect to any issue of fact or

law.

Entry of the proposed Final Judgment will terminate the action

against the defendants, except that the Court will retain jurisdiction

over the matter for further proceedings that may be required to

interpret, enforce, or modify the Final Judgment, or to punish

violations of any of its provisions. The Final Judgment will terminate

ninety days after no part of the IAM (the Grand Lodge or any District

or Local Lodge) has the right to have a representative on the board of

more than one airline.

II

Description of the Practices Involved in the Alleged Violations

Section 8 of the Clayton Act is a prophylactic provision designed

to prevent restraints on competition that may arise from interlocking

directorates or management. Interlocks can restrict competition both by

facilitating coordination between competing companies and by providing

a conduit for the exchange of competitively sensitive information.

Congress intended section 8 ``to nip in the bud incipient violations of

the antitrust laws by removing the opportunity or temptation to such

violations through interlocking directorates.'' United States v. Sears,

Roebuck & Co., 111 F. Supp. 614, 616 (S.D.N.Y. 1953). The ``opportunity

or temptation'' for antitrust violations arises not only where the same

natural person serves as a director or officer of competing companies,

but also where an entity such as a corporation or labor union serves as

a director or officer of two companies through representatives or

deputies.

In this case, the IAM serves as a director of Northwest and TWA,

important actual and potential competitors in the air passenger

transportation industry, competing for passengers on thousands of

routes both within the United States and between the United States and

international destinations. In 1993, the IAM entered into agreements

with TWA pursuant to which the airline's employees agreed to wage

reductions in exchange for an equity interest in the company and

representation on TWA's board of directors. Pursuant to these

agreements, the president of the IAM appointed William W. Winpisinger,

former president of the IAM, and William O'Driscoll, chairman of

District 142 of the IAM, to the TWA board of directors. In August 1993,

the IAM entered into similar agreements with Northwest. The president

of the IAM appointed Tom Ducy, former secretary/treasurer of the IAM to

the Northwest board of directors.

As a result of the restructuring of Northwest and TWA, the same

individual--the president of the IAM--has the power to appoint

directors of two important competitors, raising the competitive

concerns under section 8. With representatives on the boards of both

Northwest and TWA, the IAM could have the opportunity to facilitate

exchanges of confidential information or facilitate anticompetitive

coordination between the two airlines. Because members of the IAM are

employees and shareholders of both Northwest and TWA, they would

potentially benefit from a reduction of competition between the two

airlines, and thus the IAM may also have the incentive to engage in

such anticompetitive conduct.

For example, the IAM representatives may be able to use their

positions as directors to coordinate decisions by the two airlines on

pricing or entry and exit of particular markets in such a way that

competition between Northwest and TWA is reduced. The directors may

also be in a position to exchange information on competitively

sensitive subjects such as future pricing or marketing strategies. Such

anticompetitive conduct, while potentially in the interest of the union

members/shareholders at both airlines, would harm consumers. The

proposed Final Judgment is designed to prevent such abuses from arising

out of the IAM's representation on the boards of multiple airlines. In

formulating the relief in the proposed Final Judgment, however, the

Department has taken into account the limited antitrust immunity that

applies to certain activities of labor unions. See Connell Construction

Co. v. Plumbers & Steamfitters Local Union No. 100, 421 U.S. 616

(1975).

Moreover, in the near future the IAM may acquire the right to name

representatives to the boards of additional airlines. The proposed

Final Judgment will also apply to any future interlocks, and will

prevent any anticompetitive communications in those situations as well.

III

Explanation of the Proposed Final Judgment

The proposed Final Judgment is intended to insure that the IAM's

representatives on airline boards of directors do not have the ability

to use their position to restrain competition, either by engaging in

coordination or by exchanging sensitive business information. The

proposed Final Judgment creates a ``fire wall'' between the directors

to prevent the types of anticompetitive conduct that is the target of

Section 8.

A. Prohibited conduct. Section IV of the proposed Final Judgment

contains prohibitions that run against both the individual defendants

and the IAM. Section IV(1) provides that the IAM shall require its

present and any future board representatives to refrain from certain

types of conduct. Section IV(2) requires the individual defendants to

abide by the terms of the decree, including the prohibitions in Section

IV(1). Section IV(3) contains injunctions against the IAM itself.

Sections IV(1) (A)-(C) are intended to prevent IAM directors from

exchanging confidential competitively sensitive information that they

learn about through their board position. Section IV(1)(A) prohibits

IAM directors on the boards of different airlines from exchanging

certain confidential information. Section IV(1)(B) prohibits an IAM

representative from disclosing confidential information of the airline

of which he or she is a director to any person not employed by that

airline. Section IV(1)(C) prohibits an IAM representative from

voluntarily receiving confidential information from the IAM. An

exception to IV(1)(C) is made for information relating to labor

relations. ``Information relating to labor relations'' is specifically

defined, and is limited to enumerated subjects closely related to labor

relations, where communication of the information is required to

fulfill the IAM's duty of fair representation of the employees it

represents.

Section IV(1)(D) prohibits an IAM director from agreeing with or

soliciting an agreement by an IAM director on the board of another

airline that would reduce or eliminate competition between the two

carriers in violation of the Sherman Act. The provision lists several

types of agreements that would fall under this prohibition, including

agreements to increase fares, eliminate discount fares, eliminate or

reduce service, or refrain from establishing new service.

Sections IV(1) (E) and (F) enjoin the IAM directors from engaging

in communications with IAM representatives on the board of another

airline that have the purpose or effect of reducing competition between

the two carriers. These provisions are designed to prevent the IAM

representatives from using their positions to facilitate coordination

between the airlines. The IAM representatives are specifically enjoined

from discussing competitively sensitive subjects, including current or

future pricing and decisions on increasing or reducing capacity or

frequency. The IAM directors may engage in communications about the

subjects listed in IV(1)(F), however, if the communications are related

to labor relations. For example, a communication about legitimate

strike-related activities of the union, while relating to reductions in

service, would not violate IV(1)(F)(ii).

The prohibitions of Section IV(3) run against the IAM. Section

IV(3)(A) prohibits the IAM from appointing any person to the board of

directors of any airline unless that person certifies in writing that

he or she agrees to be bound by the terms of the proposed Final

Judgment, including the prohibitions in section IV(1) (A)-(F). Thus,

future IAM board representatives will be prevented from using their

position to facilitate coordination between airlines or the exchange of

confidential information. In order to prevent the possibility that IAM

officials with close day-to-day contacts will sit on the boards of

competing carriers, section IV(3)(B) prohibits the IAM from having

active officers or employees of the same District or Local Lodge from

serving concurrently on the boards of more than one airline.

Sections IV(3) (C)-(D) are designed to prevent the IAM from acting

as a conduit for exchanges of confidential information that are

proscribed by section IV(1). Section IV(3)(C) prohibits the IAM from

disclosing confidential information received from an IAM representative

on the board of any airline to any person not employed by that airline.

Section IV(3)(D) prohibits the IAM from disclosing confidential

information obtained from an IAM representative on the board of any

airline to any IAM representative on the board of any other airline.

These provisions have exceptions for information related to labor

relations.

B. Compliance program and certification. In addition to the

prohibition contained in Section IV, the IAM is obligated under Section

V to establish an antitrust compliance program. This program would

require the IAM to designate an Antitrust Compliance Officer within 30

days of the entry of the Final Judgment. The Antitrust Compliance

Officer would be responsible for distributing copies of the Final

Judgment to designated individuals. All officers of the Grand Lodge of

the IAM would be required to certify annually that they understand and

agree to abide by the terms of the Final Judgment. In addition, the

Antitrust Compliance Officer is responsible for obtaining written

certification from any person appointed by the IAM as a director of an

airline that he or she agrees to be bound by the terms of the Final

Judgment. For four years after the entry of the Final Judgment the

Antitrust Compliance Officer must file an annual certification with the

Government as to the IAM's compliance with the provisions of section V.

C. Effect of the proposed final judgment on competition. The relief

in the proposed Final Judgment is designed to prohibit the IAM and its

representatives on the boards of competing airlines from engaging in

the type of anticompetitive conduct that section 8 seeks to prevent.

The proposed Final Judgment will prevent the IAM representatives from,

directly or indirectly, facilitating coordination between airlines or

from exchanging confidential information. The Department of Justice

believes that the proposed Final Judgment contains sufficient

provisions to prevent antitrust violations by the IAM and the

representatives it has or will appoint to the boards of Northwest, TWA,

or any other airline. At the same time, however, the proposed Final

Judgment allows the IAM, through its board representatives, to protect

the interests of its members.

IV

Remedies Available to Potential Private Litigants

Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any

person who has been injured as a result of conduct prohibited by the

antitrust laws may bring suit in federal court to recover three times

the damages suffered, as well as costs and reasonable attorney's fees.

Entry of the proposed Final Judgment will neither impair nor assist the

bringing of such actions. Under the provisions of section 5(a) of the

Clayton Act, 15 U.S.C. 16(a), the Judgment has no prima facie effect in

any subsequent lawsuits that may be brought against any defendant in

this matter.

V

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 Roger W. Fones, Chief, Transportation,

Energy & Agriculture Section, U.S. Department of Justice, Antitrust

Division, 555 Fourth Street, NW., room 9104, Washington, DC 20001,

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.

VI

Alternative to the Proposed Final Judgment

The alternative to the proposed Final Judgment would be a full

trial of the case against the IAM and the individual defendants. In the

view of the Department of Justice, such a trial would involve

substantial cost to the United States, and is not warranted because the

proposed Final Judgment provides relief that will remedy the violations

of the Clayton Act alleged in the United States' Complaint.

VII

Determinative Materials and Documents

No materials and documents of the type 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.

Dated: March 30, 1994.

Respectfully submitted,

Michael D. Billiel,

DC Bar #394377, Attorney, U.S. Department of Justice, Antitrust

Division, 555 Fourth Street, NW., room 9104, Washington, DC 20001,

(202) 307-6666.

Certificate of Service

I hereby certify that I have caused a copy of the foregoing

Competitive Impact Statement to be served on counsel for defendants in

this matter in the manner set forth below:

By first class mail, postage prepaid: Allison Beck, General

Counsel, International Association of Machinists and Aerospace Workers,

9000 Machinists Place, Upper Marlboro, MD 20772. For defendants

International Association of Machinists and Aerospace Workers, Tom

Ducy, William O'Driscoll, and William W. Winpisinger.

Dated: March 30, 1994.

Michael D. Billiel,

DC Bar #394377, Antitrust Division, U.S. Department of Justice, 555

Fourth Street, NW., Washington, DC 20001, (202) 307-6666.

[FR Doc. 94-8521 Filed 4-8-94; 8:45 am]

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