Proposed Final Judgment and Competitive Impact Statement; United States v. Mid-America Dairymen, Inc., Southern Foods Group LP, and Milk Products LLC

DEPARTMENT OF JUSTICE

Antitrust Division

Proposed Final Judgment and Competitive Impact Statement; United

States v. Mid-America Dairymen, Inc., Southern Foods Group LP, and Milk

Products LLC

Notice is hereby given pursuant to the Antitrust Procedures and

Penalties Act, 15 U.S.C. Sec. 16 (b)-(h), that a proposed Final

Judgment, Stipulation, and Competitive Impact Statement have been filed

with the United States District Court for the Northern District of

Texas in United States v. Mid-America Dairymen, Inc., Southern Foods

Group LP, and Milk Products, LLC, Civil No. 3:97 CV 2162-P. The

proposed Final Judgment is subject to approval by the Court after the

expiration of the statutory 60-day public comment period and compliance

with the Antitrust Procedures and Penalties Act, 15 U.S.C. Sec. 16 (b)-

(h).

On September 3, 1997, the United States filed a Complaint seeking

to enjoin a transaction in which Mid-America Dairymen, Inc. (``Mid-

America'') would acquire the voting stock of Borden/Meadow Gold Dairies

Holdings, Inc. (``Borden/Meadow Gold''). Mid-America, through its

affiliate Southern Food Group LP (``Southern Foods''), and Borden/

Meadow Gold are two of the primary, and often the only, bidders to

supply milk to school districts in Eastern Texas and Louisiana, and

this transaction would have combined them to create a monopoly in many

of those school districts. The Complaint alleged that the proposed

acquisition would substantially lessen competition in providing milk to

school districts in Eastern Texas and Louisiana in violation of Section

7 of the Clayton Act, 15 U.S.C. Sec. 18.

The proposed Final Judgment orders Mid-America to sell the Texas,

Louisiana and New Mexico assets to be acquired from Borden/Meadow Gold

and, to the extent it sells them to a purchaser who has already agreed

to buy them (Milk Products LLC), to limit the financing that Mid-

America had agreed to provide to the purchaser. In the event Mid-

America does not sell to that purchaser, it must divest the assets to a

purchaser who has the capability to compete effectively in the

manufacture, sale and distribution of dairy products in New Mexico,

Texas and Louisiana. 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 within the statutory 60-day

comment period. Written comments should be addressed to Roger W. Fones,

Chief, Transportation, Energy and Agriculture Section, U.S. Department

of Justice, Antitrust Division, 325 Seventh Street, N.W., Suite 500,

Washington, D.C. 20530 (telephone: (202) 307-6351). Comments must be

received within 60 days. Such comments, and the responses thereto, will

be published in the Federal Register and filed with the Court.

Copies of the Complaint, Stipulation, proposed Final Judgment, and

Competitive Impact Statement are available for inspection in Room 215

of the U.S. Department of Justice, Antitrust Division, 325 Seventh

Street, N.W., Washington, D.C. 20530 (telephone: (202) 514-2481), and

at the office of the Clerk of the United States District Court for the

Northern District of Texas, 1100 Commerce Street, Dallas, Texas 75242.

Copies of these materials may be obtained upon request and payment of a

copying fee.

Constance K. Robinson,

Director of Operations, Antitrust Division.

Stipulation and Order

It is stipulated by and between the undersigned parties, through

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 Northern District of Texas.

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. Sec. 16(b)-(h)), and without further notice to any party or

other proceedings, provided that plaintiff United States has not

withdrawn its consent, which it may do at any time before the entry of

the proposed Final Judgment by serving notice thereof on defendants and

by filing that notice with the Court.

3. The defendants shall abide by and comply with the provisions of

the proposed Final Judgment pending entry

[[Page 49528]]

of the Final Judgment, or until expiration of time for all appeals of

any court ruling declining entry of the proposed Final Judgment and

shall, from the date of signing of this Stipulation, comply with all

terms and provisions of the proposed Final Judgment thereof as though

the same were in full force and effect as an order of the Court.

4. This Stipulation shall apply with equal force and effect to any

amended proposed Final Judgment agreed upon in writing by the parties

and submitted to the Court.

5. In the event plaintiff United States withdraws its consent, as

provided in Paragraph 2, above, or if the proposed Final Judgment is

not entered pursuant to this Stipulation, the time has expired for all

appeals of any Court ruling declining entry of the Final Judgment and

if the Court has not otherwise ordered continued compliance with the

terms and provision of the Final Judgment, then the parities are

released from all further obligations under this Stipulation, and the

making of this Stipulation shall be without prejudice to any party in

this or any other proceeding.

6. Defendants represent that the divestiture ordered in the

proposed Final Judgment can and will be made, and that they will later

raise no claims of hardship or difficulty as grounds for asking the

Court to modify any of the divestiture provisions contained therein.

7. The parties request that the Court acknowledge the terms of this

Stipulation by entering the Order in this Stipulation and Order.

Respectfully submitted.

For Plaintiff United States of America:

Joel I. Klien,

Assistant Attorney General.

A. Douglas Melamed,

Deputy Assistant Attorney General.

Roger W. Fones,

Chief, DC Bar # 303255.

Donna N. Kooperstein,

Assistant Chief, PA Bar # 26770.

Joan S. Huggler,

DC Bar # 927244.

Michael P. Harmonis,

PA Bar # 17994.

Robert D. Young,

DC Bar # 248260.

Attorneys, Antitrust Division, U.S. Department of Justice, 325

Seventh St. N.W., Washington, D.C., (202) 307-6456, (202) 616-2441.

Dated: September 2, 1997.

For Defendant Mid-America Dairymen, Inc.

W. Todd Miller,

DC Bar # 414930.

Baker & Miller PLLC, Suite 615, 700 Eleventh Street, NW, Washington,

D.C. 20001, (202)-637-9499, (202-637-9394 (Facsimile).

Attorneys for Mid-America Dairymen, Inc.

Dated: September 2, 1997.

For Defendant Southern Foods Group LP:

Jerry L. Beane,

TX Bar #01966000.

Strasburger & Price LLP, Suite 4300, 901 Main Street, Dallas, Texas

75202, (214-651-4521), (214)-651-4330 (Facsimile).

Attorneys for Southern Foods Group LP

Dated: September 2, 1997.

For Defendant Milk Products LLC:

Jerry L. Beane,

TX Bar #01966000.

Strasburger & Price LLP, Suite 4300, 901 Main Street, Dallas, Texas

75202, (214-651-4521), (214)-651-4330 (Facsimile).

Attorneys for Milk Products LLC

Dated: September 2, 1997.

Upon Review of this Stipulation by the parties, the Court

acknowledges by this Order that the parties have consented to the

terms specified in this Stipulation and the entry of the Final

Judgment subject to the provisions of the Antitrust Procedures and

Penalties Act (15 U.S.C. Sec. 16 (b)-(h)).

So Ordered on this ________ day of ________________, 1997.

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

United States District Court Judge

Final Judgment

Whereas, plaintiff, United States of America (hereinafter ``United

States''), having filed its complaint herein on September 3, 1997, and

plaintiff and defendants, by their respective attorneys, having

consented to the entry of this Final Judgment without trial or

adjudication of any issue of fact or law herein and without this Final

Judgment constituting any evidence against or an admission by any party

with respect to any issue of law or fact herein;

And Whereas, defendants have agreed to be bound by the provisions

of this Final Judgment pending its approval by the Court;

And Whereas, prompt and certain divestiture is the essence of this

agreement to assure that competition is not substantially lessened;

And Whereas, defendants have represented to plaintiff that the

divestiture required below and the relief related thereto can and will

be made and that defendants will later raise no claim of hardship or

difficulty as grounds for asking the Court to modify any of the

provisions contained below:

Now, Therefore, before the taking of any testimony and without

trial or adjudication of any issue of fact or law herein, and upon

consent of the parties thereto, it is hereby

Ordered, Adjudged and Decreed:

I

Jurisdiction

This Court has jurisdiction of the subject matter of this action

and each of the defendants hereto. The complaint states a claim upon

which relief may be granted against each defendant under Section 7 of

the Clayton Act, as amended, 15 U.S.C. Sec. 18.

II

Definitions

As used in this final judgment:

A. Mid-America means Mid-America Dairymen, Inc., a Kansas

corporation with headquarters in Springfield, Missouri, its members,

directors, officers, employees, affiliates, joint venture or limited

liability company partners, successors or assigns, and any agent or

representative thereof.

B. Southern Foods means Southern Foods Group LP, a partnership

organized under the laws of Delaware with headquarters in Dallas,

Texas, its members, directors, officers, employees, affiliates, joint

venture or limited liability company partners, successors or assigns,

or any agent or representative thereof.

C. Milk Products means Milk Products LLC, the limited liability

company formed by Allen A. Meyer to receive certain dairy processing

assets located in New Mexico, Texas and Louisiana formerly owned by

Borden/Meadow Gold Dairies Holdings, Inc., its members, directors,

officers, employees, affiliates, joint venture or limited liability

company partners, successors or assigns, or any agent or representative

thereof.

D. Divestiture Asserts or the Assets means the Borden/Meadow Gold

assets located in New Mexico, Texas and Louisiana that Mid-America will

acquire through purchase of the voting stock of Borden/Meadow Gold

Dairies Holdings, Inc.

E. The Marks means certain trademarks described in a Sublicense

Agreement between Southern Foods and Milk Products, which include

Borden, Elsie and other trademarks granted to Mid-America and/or

Southern Foods by license from Borden, Inc. and BDH Two, Inc.

F. Divest or Divestiture means the complete relinquishing of all

rights and equity and other interests in the Divestiture Assets,

provided that if Mid-America divests the Assets to Milk Products, it

may extend to Milk

[[Page 49529]]

Products the Loan defined herein. Divestiture also means to grant an

exclusive, royalty-free sublicense to use the Marks in Texas, Louisiana

and New Mexico and a non-exclusive, royalty-free sublicense to use the

Marks in Alabama, Arkansas, Florida, Mississippi, Tennessee, and

Mexico.

G. Milk Products Loan or the Loan means the approximately $40

million advanced by Mid-America or Mid-Am Capital LLC for the purchase

by Milk Products of the assets located in New Mexico, Texas and

Louisiana held by Borden/Meadow Gold Dairies Holdings, Inc., and for

which Milk Products has executed Note Purchase Agreements and other

related debt instruments setting forth the terms of the loan

arrangements.

III

Applicability

A. The provisions of this final judgment shall apply to the

defendants, Mid-America Dairymen, Southern Foods Group, and Milk

Products, their respective successors and assigns, 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.

B. Each defendant shall provide written notice to the plaintiff no

later than 10 days subsequent to the effective date of any action

whereby the defendant (1) changes its name or corporate or

organizational structure; (2) liquidates or otherwise ceases operation;

or (3) declares bankruptcy. Such notice shall include a full

explanation of the action that invokes this provision and shall include

full documentation required to be filed with any judicial,

administrative or other official entity in connection with that action.

IV

Divestiture

A. Defendant Mid-America is hereby ordered and directed in

accordance with the terms of this Final Judgment, within 65 days of the

filing of this Final Judgment, or five days after notice of entry of

this Final Judgment by the Court, whichever is later, to divest the

Divestiture Assets and the Marks to a purchaser acceptable to the

United States. Plaintiff may, in its sole discretion, extend the time

period for an additional period of time, not to exceed 90 calendar days

in total.

B. Unless the United States otherwise consents in writing, the

divestiture of the Assets and the Marks pursuant to Paragraph IV (A),

or by a trustee appointed pursuant to Paragraph V of this Final

Judgment, shall include all of the Assets and the Marks to be divested

to a purchaser in such a way as to satisfy the United States in its

sole discretion that the Assets and the Marks can and will be used by

the purchaser as part of a viable, ongoing business engaged in the

manufacture, sale and distribution of dairy products in New Mexico,

Texas and Louisiana. The divestiture, whether pursuant to Paragraph IV

or V of this Final Judgment shall be made to a purchaser for whom it is

demonstrated to the sole satisfaction of the United States that (1) the

purchaser has the capability and intent of competing effectively in the

manufacture, sale and distribution of dairy products in New Mexico,

Texas and Louisiana; (2) the purchaser has or soon will have the

managerial, operational, and financial capability to compete

effectively in the manufacture, sale and distribution of dairy products

in New Mexico, Texas and Louisiana; and (3) none of the terms of any

agreement between the purchaser and Mid-America give Mid-America the

ability unreasonably to raise the purchaser's cost, to lower the

purchaser's efficiency, or otherwise to interfere in the ability of the

purchaser to compete effectively in the manufacture, sale and

distribution of dairy products in New Mexico, Texas and Louisiana.

C. The Divestiture of the Assets and the Marks to Milk Products, if

accomplished in accordance with this Final Judgment within twenty-four

hours following the acquisition by Mid-America of the voting stock of

Borden/Meadow Gold, is acceptable to the United States and no further

approval of plaintiff pursuant to this Paragraph IV or Paragraph IX is

required.

V

Apppointment of Trustee

A. In the event that Mid-America has not divested the Divestiture

Assets and the Marks within the time specified in Paragraph IV (A) of

this Final Judgment, the Court shall appoint, on application of the

United States, a trustee selected by the United States to effect the

divestiture of the Divestiture Assets and the Marks.

B. After the appointment of a trustee becomes effective, only the

trustee shall have the right to accomplish the divestiture of the

Assets and the Marks. The trustee shall have the power and authority to

accomplish the divestiture at the best price then obtainable upon a

reasonable effort by the trustee, subject to the provisions of

Paragraphs V and IX of this Final Judgment, and shall have such other

powers as the Court shall deem appropriate. Subject to Paragraph V (C)

of this Final Judgment, the trustee shall have the power and authority

to hire at the cost and expense of Mid-America any investment bankers,

attorneys, or other agents reasonably necessary in the judgment of the

trustee to assist in the divestiture, and such professionals and agents

shall be accountable solely to the trustee. The trustee shall have the

power and authority to accomplish the divestiture at the earliest

possible time to a purchaser acceptable to the United States, and shall

have such other powers as this Court shall deem appropriate. Mid-

America shall not object to a sale by the trustee on any grounds other

than the trustee's malfeasance. Any such objections by defendants must

be conveyed in writing to plaintiffs and the trustee within ten (10)

calendar days after the trustee has provided the notice required under

Paragraph IX of this Final Judgment.

C. The trustee shall serve at the cost and expense of Mid-America,

on such terms and conditions as the Court may prescribe, and shall

account for all monies derived from the sale of the assets sold by the

trustee and all costs and expenses so incurred. After approval by the

Court of the trustee's accounting, including fees for its services and

those of any professionals and agents retained by the trustee, all

remaining money shall be paid to Mid-America and the trust shall then

be terminated. The compensation of such trustee and of any

professionals and agents retained by the trustee shall be reasonable in

light of the value of the Divestiture Assets and the Marks and based on

a fee arrangement providing the trustee with an incentive based on the

price and terms of the divestiture and the speed with which it is

accomplished.

D. Mid-America shall use its best efforts to assist the trustee in

accomplishing the required divestiture. The trustee and any

consultants, accountants, attorneys, and other persons retained by the

trustee shall have full and complete access to the personnel, books,

records, and facilities of defendants, and defendants shall develop

financial or other information relevant to such assets as the trustee

may reasonably request, subject to reasonable protection for trade

secret or other confidential research, development, or commercial

information. Mid-America shall take no action to interfere with or to

impede the trustee's accomplishment of the divestiture.

[[Page 49530]]

E. After its appointment, the trustee shall file monthly reports

with the parties and the Court setting forth the trustee's efforts to

accomplish the divestiture ordered under this Final Judgment. If the

trustee has not accomplished such divestiture within six (6) months

after its appointment, the trustee thereupon shall file promptly with

the Court a report setting forth (1) the trustee's efforts to

accomplish the required divestiture, (2) the reasons, in the trustee's

judgment, that the required divestiture has not been accomplished, and

(3) the trustee's recommendations; provided, however, that to the

extent such reports contain information that the trustee deems

confidential, such reports shall not be filed in the public docket of

the Court. The trustee shall at the same time furnish such report to

the parties, who shall each have the right to be heard and to make

additional recommendations consistent with the purpose of the trust.

The Court shall enter thereafter such orders as it shall deem

appropriate in order to carry out the purpose of the trust, which may,

if necessary, include extending the trust and the term of the trustee's

appointment by a period requested by the plaintiffs.

VI

Divestiture of the Loan

If Mid-America sells the Divestiture Assets to Milk Products,

A. Mid-America shall reduce its holdings in the Milk Products Loan

as follows:

(1) to $30 million or less by December 31, 1997;

(2) to $13 million or less by September 1, 1998; and

(3) to zero by September 1, 1999.

B. Mid-America may sell off any portion of the Milk Products Loan

in order to meet the requirements of Paragraph VI(A), provided that no

third party purchaser of all or part of the Loan shall (1) be

affiliated in any way with Mid-America or (2) be a person engaged in

the production, sale or delivery of milk in the sales area of Milk

Products.

C. In connection with sale of the Milk Products Loan pursuant to

Paragraph VI(A), Mid-America shall not provide a guarantee to any third

party purchaser, provided, however, that Mid-America may, in its

discretion, after it has reduced its holdings in the Loan to not more

than $13 million, guarantee some or all of the remaining $13 million.

Any guarantee by Mid-America must be without recourse against Milk

Products for any sums paid by Mid-America by virtue of the guarantee.

D. At no time while Mid-America holds all or part of the Milk

Products Loan shall Mid-America (1) require that Milk Products seek

approval from, or give notice to, Mid-America before incurring any

indebtedness, or (2) place any restriction on Milk Products' ability to

conduct its operations as it sees fit.

VII

Acquisitions and Access to Information

During any period in which Mid-America retains an ownership

interest in Southern Foods,

A. No member, officer, employee or agent of Southern Foods or Mid-

America (other than members, officers, employees, or agents of Land-O-

Sun Dairy LLC, who are not otherwise affiliated with Mid-America or

Southern Foods) shall be employed by or serve as an officer, director,

member, or agent of Milk Products.

B. No member, officer, employee or agent of Milk Products shall be

employed by or serve as an officer, director, member or agent of Mid-

America or Southern Foods (other than members, officers, employees or

agents of Land-O-Sun Dairy LLC, who are otherwise not affiliated with

Mid-America or Southern Foods).

C. Neither Mid-America nor Southern Foods shall merge or

consolidate with, acquire membership in or securities or assets of, or

provide loans or other financing to (except for trade credit extended

in the ordinary course of business) Milk Products, without having first

obtained the written approval of the United States. Any request for

such approval shall be directed to the Antitrust Division, U.S.

Department of Justice, Transportation, Energy and Agriculture Section,

with a copy to the Director of Operations.

D. Mid-America, Southern Foods, and Milk Products shall not

disclose to each other, directly or indirectly, any competitively

sensitive information including, but not limited to, information

concerning present or future prices or other terms or conditions of

sale including discounts, slotting allowances, bids or price lists,

costs, capacity, distribution, marketing plans or territories, supply,

sales forecasts, customer relationships (including the identity of

actual or potential customers or quantities sold to any particular

customer).

E. Notwithstanding Paragraph VII(D), Mid-America may, during any

period in which it is a creditor of Milk Products, obtain and retain

copies of the following information, solely to protect its interests as

a creditor:

(1) Copies of Milk Products' federal income tax returns for each

year; and

(2) quarterly financial statements, including a balance sheet, a

statement of profits and losses, and a statement of cash flow,

aggregated for the entire company. Nothing in this provision shall

limit the information that a purchaser of any portion of the Milk

Products Loan may request and obtain, subject to reasonable commercial

credit practices.

F. Nothing in this Final Judgment shall prohibit the orderly

transfer of business records, reports or accounting materials from

Borden/Meadow Gold to Southern Foods or to Milk Products, which shall

be accomplished within 120 days of the closing of the transaction.

VIII

Sublicense Agreement

A. Southern Foods, as sublicensor of the Marks, shall promptly

notify Borden, Inc. and BDH Two, Inc., the owners of the Marks, of any

unauthorized use of the Marks when such use comes to the attention of

Southern Foods from any source, including Milk Products, and Southern

Foods shall take all actions as may be required by Borden, Inc. and BDH

Two, Inc. regarding the unauthorized use of the Marks.

B. Neither Mid-American nor Southern Foods shall assert or claim

that on any sublicensee of the Marks' sale of any equity interest in

the sublicensee or any change in control or ownership in the

sublicensee will affect or diminish the sublicensee's rights in or use

of the Marks.

C. Mid-American and Southern Foods shall ensure that the rights

that any sublicensee obtains in the Marks are equal to all the rights

and privileges that Southern Foods obtains for itself in its license of

the Marks from Borden, Inc. and BDH Two, Inc.

IX

Notification

Within two (2) business days following execution of a definition

agreement, contingent upon compliance with the terms of this Final

Judgment, any proposed divestiture pursuant to Paragraph IV, V or VI of

this Final Judgment, Mid-America or the trustee, whoever is responsible

for the divestiture, shall notify plaintiff of the proposed divestiture

and provide documentation that the conditions set forth in Paragraphs

IV through VII have been met.

If the trustee is responsible, it shall similarly notify Mid-

America. The notice shall set forth the details of the proposed

transaction and list the name, address, and telephone number of each

[[Page 49531]]

person not previously identified who offered to, or expressed an

interest in or a desire to, acquire any ownership interest in the

Assets, together with full details of same. Within fifteen (15)

calendar days of receipt by plaintiff of such notice, plaintiff may

request from Mid-America, the proposed purchaser, any other third

party, or the trustee if applicable, additional information concerning

the proposed divestiture and the proposed purchaser. Mid-America and

the trustee shall furnish any additional information requested within

fifteen (15) calendar days of the receipt of the request, unless the

parties shall otherwise agree. Within thirty (30) calendar days after

receipt of the notice or within twenty (20) calendar days after

plaintiff has been provided the additional information requested from

Mid-America, the proposed purchaser, any third party, and the trustee,

whichever is later, the United States shall provide written notice to

Mid-America and the trustee, if there is one, stating whether or not it

objects to the proposed divestiture. If the United States provides

written notice to Mid-America and the trustee that it does not object,

then the divestiture may be consummated, subject only to Mid-America's

limited right to object to the sale under Paragraph V(B) of this Final

Judgment. Absent written notice that the United States does not object

to the proposed purchaser or upon objection by the United States, a

divestiture proposed under Section IV shall not be consummated. Upon

objection by the United States, or by Mid-America in accordance with

Section V(B), a divestiture proposed under Section V shall not be

consummated unless approved by the Court.

X

Affidavits

A. Within twenty (20) calendar days of the closing of any

transaction in which Mid-America directly or indirectly acquires all or

any part of the assets or capital stock of Borden/Meadow Gold, and

every thirty (30) calendar days thereafter until the divestiture of the

Divestiture Assets and the Loan has been completed pursuant to

Paragraphs IV, V and VI of this Final Judgment, Mid-America shall

deliver to plaintiff an affidavit as to the fact and manner of

compliance with Paragraph IV, V and VI of this Final Judgment. Each

such affidavit shall include the name, address, and telephone number of

each person who, at any time after the period covered by the last

report, made an offer to acquire, expressed an interest in acquiring,

entered into negotiations to acquire or was contacted or made an

inquiry about acquiring any interest in the Divestiture Assets or in

the Loan, and shall describe in detail each contact with any such

person during that period.

B. Mid-America shall preserve all records of all efforts made to

divest the Loan and the Assets. This provision shall not apply to

divestiture of the Assets if they are sold pursuant to Paragraph IV(C)

herein.

XI

Compliance Inspection

Only for the purposes of determining or securing compliance with

the Final Judgment and subject to any legally recognized privilege,

from time to time:

A. Duly authorized representatives of the plaintiff, including

consultants and other persons retained by the United States, upon

written request of the Assistant Attorney General in charge of the

Antitrust Division, and on reasonable notice to defendants made to

their principal offices, shall be permitted:

(1) Access during office hours of defendants to inspect and copy

all books, ledgers, accounts, correspondence, memoranda, and other

records and documents in the possession or under the control of

defendants, who may have counsel present, relating to enforcement of

this Final Judgment; and

(2) Subject to the reasonable convenience of defendants and without

restraint or interference from them, to interview their officers,

employees, and agents, who may have counsel present, regarding any such

matters.

B. Upon the written request of the Assistant Attorney General in

charge of the Antitrust Division made to defendants' principal offices,

defendants shall submit such written reports, under oath if requested,

with respect to enforcement of this Final Judgment.

C. No information or documents obtained by the means provided in

Paragraph XI of this Final Judgment shall be divulged by a

representative of 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 plaintiff is a

party (including grand jury proceedings), 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 plaintiff, defendants represent and identify in writing

the material in any such information or documents to which a claim of

protection may be asserted under Rule 26(c)(7) of the Federal Rules of

Civil Procedure, and defendants mark each pertinent page of such

material, ``Subject to claim of protection under Rule 26(c)(7) of the

Federal Rules of Civil Procedure,'' then ten (10) calendar days notice

shall be given by plaintiff to defendants prior to divulging such

material in any legal proceeding (other than a grand jury proceeding).

XII

Retention of Jurisdiction

Jurisdiction is retained by this Court for the purpose of enabling

any of the parties to this Final Judgment to apply to this Court at any

time for such further orders and directions as may be necessary or

appropriate for the construction or carrying out of this Final

Judgment, for the modification of any of the provisions hereof, for the

enforcement of compliance herewith, and for the punishment of any

violations hereof.

XIII

Termination

Unless this Court grants an extension, this Final Judgment will

expire on the tenth anniversary of the date of its entry.

XIV

Public Interest

Entry of this Final Judgment is in the public interest.

Dated:-----------------------------------------------------------------

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

United States District Judge

Certificate of Service

I hereby certify that a copy of the foregoing has been served upon

the attorneys for Mid-America Dairymen, Inc., Southern Foods Group LP,

and Milk Products LLC by placing a copy in the U.S. Mail, directed to

each of the above named parties at the addresses given below, this 3rd

day of September 1997.

Mid-America Dairymen, Inc., c/o W. Todd Miller, Baker & Miller PLLC,

Suite 615, 700 Eleventh Street, NW., Washington, DC 20001.

Southern Foods Group LP, c/o Jerry L. Beane, Strasburger & Price LLP,

Suite 4300, 901 Main Street, Dallas, Texas 75202.

[[Page 49532]]

Milk Products LLC, c/o Jerry L. Beane, Strasburger & Price LLP, Suite

4300, 901 Main Street, Dallas, Texas 75202.

Joan S. Huggler,

DC Bar #927244, Attorney, Antitrust Division, U.S. Department of

Justice, 325 Seventh St. NW., Suite 500, Washington, DC 20530, (202)

307-6456, (202) 661-2441 (Facsimile).

Competitive Impact Statement

The United States, pursuant to Section 2(b) of the Antitrust

Procedures and Penalties Act (``APPA''), 15 U.S.C. Sec. 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 September 3,

1997, alleging that the proposed acquisition by Mid-America Dairymen,

Inc. (``Mid-America'') of the voting stock of Borden/Meadow Gold

Dairies Holdings, Inc. (``Borden/Meadow Gold'') would violate Section 7

of the Clayton Act, 15 U.S.C. Sec. 18, by combining the two main

suppliers of milk to schools in Eastern Texas and Louisiana.

The Complaint alleges that the acquisition of Borden/Meadow Gold's

fluid milk processing plants in Eastern Texas and Louisiana by Mid-

America, owner of a substantial interest in Southern Foods Group LP

(``Southern Foods''), would substantially lessen competition in the

production, sale and distribution of milk to schools in the area where

Borden/Meadow Gold and Southern Foods each has operations and competes

for school milk business.

The Complaint also alleges that the parties' proposed remedy--

divestiture of the overlapping facilities formerly held by Borden/

Meadow Gold to a newly-formed company called Milk Products LLC that

would be financed in large part by a loan to Milk Products from Mid-

America affiliate Mid-Am Capital LLC--would not adequately replace the

competition now provided by Borden/Meadow Gold in Eastern Texas and

Louisiana.

At the same time the suit was filed, a proposed settlement was

filed that would permit Mid-America to complete the acquisition of

Borden/Meadow Gold, yet preserve competition in the areas where the

transaction would raise significant competitive concerns.

The proposed Final Judgment orders Mid-America to divest the

Borden/Meadow Gold assets in Texas, Louisiana and New Mexico to a

purchaser acceptable to the United States. The Final Judgment would

allow divestiture to Milk Products if the loan to Milk Products by Mid-

Am Capital is appropriately conditioned and sold off in its entirety

within two years. If Mid-America divests the overlapping assets to Milk

Products within 24 hours of its acquisition of the voting stock of

Borden/Meadow Gold in accordance with the Final Judgment, no further

approvals would be needed.

If Mid-America does not divest to Milk Products, the assets must be

divested to another purchaser within 65 days of the closing of the

acquisition of the Borden/Meadow Gold voting stock (``the stock

transaction''), which period may be extended by the United States to no

more than 90 days. If the divestiture still has not occurred after 90

days, the United States may ask the Court to appoint a trustee who

shall assume the responsibility for selling those assets.

The Final Judgment sets out the conditions for reduction of the

loan amount advanced to Milk Products by Mid-Am Capital. The loan

amount may be reduced in three segments, to reach zero by September 1,

1999. The Final Judgment also imposes other restrictions on Mid-

America's ability to affect the competitive performance of Milk

Products because of its creditor relationship through Mid-Am Capital.

Finally, the Final Judgment contains provisions that limit

communications and other interaction among Mid-America, Southern Foods,

and Milk Products, with the purpose of minimizing or eliminating the

opportunity or ability of any of them to affect competitive outcomes in

school milk bid markets in Eastern Texas and Louisiana.

The United States, Southern Foods and Milk Products have stipulated

that the proposed Final Judgment may be entered after compliance with

the APPA. Entry of the proposed Final Judgment would terminate this

action, except that the Court would retain jurisdiction to construe,

modify or enforce the provisions of the Final Judgment and to prevent

violations of it.

II

Description of the Events Giving Rise to the Alleged Violation

A. The Defendants and the Proposed Transaction

Mid-America is the nation's largest cooperative of diary farmers,

with some 18,000 members in 30 states. In addition to marketing the

milk of its members, Mid-America has extensive ownership and other

interests in dairy manufacturing and processing operations and in the

sale of products and services related to dairying, such as farm

equipment and cleaning supplies. Mid-America had revenues of more than

$4 billion in 1996.

Southern Foods in one of Mid-America's joint venture affiliates. It

is organized as a partnership whose owners are Mid-America (50%) and,

until recently, two individual owners of the remaining 50% share of the

partnership. (One of these individuals is Allen A. Meyer, who will sell

his interest in Southern Foods to Pete Schenkel, the other 25% owner,

as a precondition to the divestiture of the Borden/Meadow Gold assets

in Eastern Texas and Louisiana into Milk Products, of which Meyer will

be the sole owner.) From its plants in Eastern Texas and Louisiana,

Southern Foods sells a variety of dairy products including fluid milk

for schools. In 1996, Southern Foods had revenues of more than $550

million. Southern Foods operates eight fluid milk processing plants--

five in Eastern Texas and three in Louisiana. Southern Foods sells

under a number of brand names including Oak Farms, Golden Royal,

Midwest Farms, Sunnydell, Texas Bluebonnet, Schepps, Dairyland, Gooddy,

Brown's Velvet, Medallion, Foremost, Barbe, and Guth.

Milk Products is a newly-formed limited liability company that will

purchase the Borden/Meadow Gold facilities whose marketing areas in

Eastern Texas and Louisiana overlap with the marketing area of Southern

Foods in these states.

On May 22, 1997 Mid-America and Borden/Meadow Gold entered into an

agreement whereby Mid-America would acquire all of the voting stock of

Borden/Meadow Gold for $435 million. Mid-America would thereby acquire

25 processing plants and related facilities in all states. On May 28,

1997, Mid-America agreed that it would sell the to-be-acquired assets

in Texas, Louisiana and New Mexico to Milk Products for $65 million and

that the purchase would be financed in part by a loan from Mid-Am

Capital of at least $35 million. The Loan amount was later increased to

$40 million.

B. Fluid Milk Sold to Schools

Fluid milk is pasteurized milk sold for human consumption in liquid

form. In addition to supermarkets and grocery stores, other major

buyers of fluid milk are institutional customers such as schools,

hospitals, military installations and prisons. Whereas supermarkets and

other large grocery stores buy most of their milk packaged in gallon,

half gallon an quart size containers, other customers, particularly

schools, purchase most, if not all, of their milk in half pint

containers, which is a

[[Page 49533]]

convenient size for storage and for serving to children in school

cafeterias. Virtually all fluid milk processing plants package milk in

gallons and half gallons, but not all of them produce half pints.

Therefore, school districts that are looking for suppliers have a

smaller universe of potential of potential sellers than do most retail

outlets, warehouses and other customers.

Most schools participate in the federally-funded National School

Lunch Program and School and Breakfast Program. In order to receive

reimbursement for meals served at lower than cost to eligible children

in these programs, schools must offer eight ounces of milk as part of

each meal they serve. It is thus important for many school districts,

which often operate on limited budgets, to have a steady and reliable

source of milk. There are no substitutes for milk that schools can use

still received such reimbursement. Therefore, even a substantial rise

in the price of milk to schools would not cause a school district to

turn to another product.

Schools also have special delivery and service needs that other

buyers of fluid milk often do not have. Because their storage space and

equipment such as coolers are often limited, many schools require

frequent deliveries, sometimes as many as five days a week. Many

schools specify that the milk be delivered at particular hours during

the day. These factors, plus the seasonal nature of their purchases,

generally dictate the methods to be used by their milk suppliers in

servicing them. Most often, school milk is delivered on small (14 feet

to 18 feet) route trucks that also carry milk and other dairy products

for non-school customers such as small grocery or convenience stores,

restaurants, or hospitals.

School districts that require such service can obtain supplies only

from a milk processor that has both the ability and the desire to

package milk in half pint containers and also has an established small

route truck distribution system in or near the school district. As a

general rule, only such a processor can economically serve those

districts.

School districts purchase their milk on the basis of competitive

bids that are requested annually. Contracts are usually awarded for a

one-year term. Each bid cycle may produce a new set of bidders for that

business in that time period.

C. Competition Between Southern Foods and Borden/Meadow Gold

Southern Foods and Borden/Meadow Gold are the primary, and often

the only, actual or potential suppliers of fluid milk to schools in

Eastern Texas and Louisiana. These firms also compete with other

processors for sales to supermarkets and grocery stores. These other

processors do not compete for school milk, however, because they lack

half-pint packaging equipment, small delivery truck routes, or both.

Both Southern Foods and Borden/Meadow Gold also compete with others for

the private label milk business of large wholesalers and retailers.

In the school milk markets, however, Southern Foods and Borden/

Meadow Gold are often the only bidders for a particular school

district. This is true both in large metropolitan areas such as Dallas/

Fort Worth, Waco, and San Antonio and in many other less populated

areas of Eastern Texas. In the Houston area, and around Bryan and

College Station, Southern Foods and Borden/Meadow Gold sometimes

compete with one other milk processor. In most of Louisiana, the only

third bidder to school districts is a small dairy processing firm

located in Baton Rouge whose ability to serve schools is limited to an

area about 50 miles around Baton Rouge.

The Complaint alleges that, were Mid-America to retain the Borden/

Meadow Gold assets it will own as a result of the stock transaction,

there would be a significant loss of competition for school milk

business in Eastern Texas and Louisiana. This is because Mid-America

would replace an independent firm (Borden/Meadow Gold) that is the most

significant school milk competitor of Southern Foods, a Mid-America

affiliate.

The Complaint also alleges that the parties' proposed remedy--

divestiture of the Texas, Louisiana and New Mexico assets to Milk

Products with a loan to Milk Products by a Mid-America affiliate, Mid-

Am Capital--is inadequate to cure the anticompetitive effects of the

stock transaction. Mid-America has a substantial ownership interest in

Southern Foods. The size and terms of the loan as originally proposed,

together with Mid-America's financial interest in Southern Foods, could

give Mid-America's financial interest in Southern Foods, could give

Mid-America both the incentive and the ability to inhibit competition

between Southern Foods and Milk Products.

The Complaint alleges that school milk markets in many areas of the

country have been subject to collusive behavior by dairy firms and that

where collusion in these markets has been detected it has been shown to

persist for many years. Thus, according to the Complaint, new entry

into the provision of milk to schools in Eastern Texas and Louisiana by

other processors is unlikely to counteract the anticompetitive effects

of the stock transaction, even with the remedy as proposed by the

parties.

III

Explanation of the Proposed Final Judgment

The proposed Final Judgment would preserve competition in the sale

of fluid milk to schools in Eastern Texas and Louisiana. The Judgment

reflects the intention of Mid-America to sell the Borden/Meadow Gold

assets in Texas, Louisiana and New Mexico to Milk Products promptly

following the closing of the stock transaction. Should that divestiture

not occur, the proposed Final Judgment requires divestiture of these

assets within 65 days of the stock transaction of the stock transaction

or five days after notice of the entry of this Final Judgment by the

Court, whichever is later, to a purchaser acceptable to the United

States. That period could be extended by the United States to 90 days.

Should Mid-America be unable to divest the assets to an acceptable

purchaser within the appointed time, the Final Judgment requires that

the United States request the Court to appoint a trustee, who will

assume the responsibility of selling the assets to a purchaser

acceptable to the United States. Under the terms of the proposed

trusteeship, the trustee will have the incentive to quickly conclude a

sale of the assets. After the appointment, the trustee will file

monthly reports with the parties and the Court regarding the efforts

made to sell the assets. If divestiture has not occurred within six

months, the trustee and the parties will make recommendations to the

Court, which shall enter such orders as are appropriate.

The Final Judgment also places restrictions on the size and terms

of the loan that Mid-America or its affiliate, Mid-Am Capital, will

make to Milk Products in connection with divestiture of the assets to

Milk Products. Financing for the purchase of the assets by Milk

Products will come from two sources. One is a secured revolving loan

provided by Bank of America. The other is a $40 million loan provided

by Mid-Am Capital that is unsecured and not convertible to equity. The

Final Judgment prohibits Mid-America and Mid-Am Capital from requiring

that Milk Products obtain their approval before incurring any

indebtedness and from interfering in any way in the operation of Milk

Products' business because of the creditor relationship.

[[Page 49534]]

The proposed Final Judgment also places limits on the length of

time that Mid-American or Mid-Am Capital may hold the loan and

restricts the amount of the loan that either may hold at any particular

time. The Final Judgment requires Mid-America or Mid-Am Capital to

terminate its interest in the loan by selling it to a third party

purchaser or purchasers if necessary by no later than September 1,

1999, and to reduce its interest in the loan before that at least by

amounts sufficient to meet two interim goals. The Final Judgment

recognizes that sale of the last portion of the loan (not to exceed $13

million) may be facilitated if Mid-American were to guarantee that part

of the loan. Nevertheless, the Judgment prohibits any guarantee that

would allow Mid-American to recover from Milk Products any monies paid

in its role as guarantor.

The Final Judgment contains additional provisions that are designed

to protect against anticompetitive effects that might occur because of

Mid-America's relationships with Southern Foods and Milk Products. The

Final Judgment prohibits Milk Products. The Final Judgment prohibits

Milk Products, Southern Foods and Mid-America from exchanging

competitively sensitive information among themselves and thereby

dampening competition between Milk Products and Southern Foods in

Eastern Texas and Louisiana.

The Final Judgment also enjoins Southern Foods and Mid-America, in

any period while Mid-America has an interest in Southern Foods, from

sharing employees, members, officers, or agents with Milk Porducts.

Such intermingling of personnel could easily inhibit vigorous

competition between Milk Products and Southern Foods. Because the owner

of Milk Products will retain his ownership interest in Land-O-Sun Dairy

LLC, a Mid-American joint venture based in Tennessee which does not

operate in Texas or Louisiana, the prohibition against sharing

officers, employees or agents does not apply to Land-O-Sun's employees,

members, officers or agents.

Finally, the Final Judgment contains provisions that are designed

to ensure that Milk Products or any purchaser of the divested assets

will have full rights in and use of certain trademarks of Borden, Inc.

and BDH Two, Inc. (``Borden''). Borden will grant to Mid-American and/

or Southern Foods an exclusive, royalty-free license to use the Borden,

Elsie and other trademarks in Texas, Louisiana, and New Mexico and a

non-exclusive license to use them in Alabama, Arkansas, Florida,

Mississippi, Tennessee, and Mexico. The Final Judgment provides that

Southern Foods, in term, will sublicense the Borden and Elsie marks to

Milk Products and that Mid-American and Southern Foods will ensure that

Milk Product's (or another purchaser's) rights in the marks will be

equal to all the rights and privileges that Southern Foods obtains for

itself in its license of the marks from Borden. Mid-American and

Southern also are enjoined from asserting or claiming that a sale of an

equity interest in Milk Products will affect or diminish Milk Products'

rights in the marks.

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

attorney's fees. Entry of the proposed Final Judgment will neither

impair nor assist the bringing of any private antitrust damage action.

Under provisions of Section 5(a) of the Clayton Act (15 U.S.C. Sec. 16

(a)), the proposed Final Judgment has no prima facie effect in any

subsequent private lawsuit that may be brought against the defendants.

V

Procedures Available for Modification of the Proposed Final Judgment

The United States and the defendants have stipulated that the

proposed Final Judgment may be entered by the Court after compliance

with the provisions of the APPA, provided that the United States has

not withdrawn its consent. The APPA conditions entry upon the Court's

determination that the proposed Final Judgment is in the public

interest.

The APPA provides that there be a period of at least sixty (60)

days prior to the effective date of a proposed Final Judgment within

which any person may submit to the United States written comments

regarding the proposed Final Judgment. All comments will be given due

consideration by the United States, which remains free to withdraw its

consent to the Final Judgement at any time prior to entry. The United

States will respond to the comments and file both the comments and the

responses with the court.

Any person believing that the proposed Final Judgment should be

modified may submit written comments to: Roger W. Fones, Chief,

Transportation, Energy, and Agriculture Section, Antitrust Division,

United States Department of Justice, Suite 500, 325 Seventh Street,

N.W., 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

Alternative 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 in this

case. Such litigation would involve all of the issues in this case,

including the proposed remedy of the parties. In the view of the

Department of Justice, a full trial on the merits is not warranted in

this case because divestiture of the assets and loan, under the terms

of the Final Judgment, as well as the additional relief relating to

possible spillover effects stemming from the relationships of Mid-

America, Southern Foods and Milk Products, would preserve the

competition adversely affected by the acquisition of the Borden/Meadow

Gold voting stock by Mid-America. The proposed Final Judgment is

designed to achieve fully adequate relief, while avoiding the expense

and uncertainty of a full trial on the merits.

VII

Standard of Review Under the APPA for Proposed Final Judgment

The APPA requires that proposed consent judgments in antitrust

cases brought by the United States be subject to a sixty (60) day

comment period, after which the court shall determine whether entry of

the proposed Final Judgment ``is in the public interest.'' In making

that determination, the court may consider--

(1) the competitive impact of such judgment, including

termination of alleged violations, provisions for enforcement and

modification, duration or relief sought, anticipated effects of

alternative remedies actually considered, and any other

considerations bearing upon the adequacy of such judgment;

(2) the impact of entry of such judgment upon the public

generally and individuals alleging specific injury from the

violations set forth in the complaint including consideration of the

public benefit, if any, to be derived from a determination of the

issues at trial.

15 U.S.C. Sec. 16(e). As the United States Court of Appeals for the

D.C. Circuit has held, this statute permits a court to consider, among

other things, the relationship between the remedy

[[Page 49535]]

secured and the specific allegations set forth in the government's

complaint, whether the decree is sufficiently clear, whether

enforcement mechanisms are sufficient, and whether the decree may

positively harm third parties. See United States v. Microsoft, 56 F.3d

1448, 1461-62 (D.C. Cir. 1995).

In conducting this inquiry, ``[t]he court is nowhere compelled to

go to trial or to engage in extended proceedings which might have the

effect of vitiating the benefits of prompt and less costly settlement

through the consent decree process.\1\ Rather,

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

\1\ 119 Cong. Rec. 24598 (1973). See United States v. Gillette

Co., 406 F. Supp. 713, 715 (D. Mass. 1975). A ``public interest''

determination can be made properly on the basis of the Competitive

Impact Statement and Response to Comments filed pursuant to the

APPA. Although the APPA authorizes the use of additional procedures,

15 U.S.C. 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. Code Cong. & Ad. News

6535, 6538.

absent a showing of corrupt failure of the government to discharge

its duty, the Court, in making its public interest finding, should *

* * carefully consider the explanations of the government in the

competitive impact statement and its responses to comments in order

to determine whether those explanations are reasonable under the

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

circumstances.

United States v. Mid-America Dairymen, Inc., 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 1460-62. Precedent requires that

the balancing of competing social and political interests affected

by a proposed antitrust consent decree must be left, in the first

instance, to the discretion of the Attorney General. The court's

role in protecting the public interest is one of insuring that the

government has not breached its duty to the public in consenting to

the decree. The court is required to determine not whether a

particular decree is the one that will best serve society, but

whether the settlement is within the reaches of the public

interest.'' More elaborate requirements might undermine the

effectiveness of antitrust enforcement by consent decree.\2\

\2\ United States v. Bechtel, 648 F.2d at 666 (citations

omitted) (emphasis added); see United States v. BNS, Inc., 858 F2d

at 463; United States v. National Broadcasting Co., 449 F. Supp.

1127, 1143 (C.D. Cal. 1978); United States v. Gillette Co., 406 F.

Supp. at 716; see also Microsoft, 56 F.3d at 1461 (whether ``the

remedies [obtained in the decree are] so inconsonant with the

allegations charged as to fall outside of the `reaches of the public

interest.' '') (citations omitted).

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

The proposed Final Judgment, therefore, should not be reviewed

under a standard of whether it is certain to eliminate every

anticompetitive effect of a particular practice or whether it mandates

certainty of free competition in the future. Court approval of a final

judgment requires a standard more flexible and less strict than the

standard required for a finding of liability. ``[A] proposed decree mut

be approved even if it falls short of the remedy the court would impose

on its own, as long as it falls within the range of acceptability or is

`within the reaches of public interest.' (citations omitted).'' \3\

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

\3\ United States v. American Tel. and Tel. Co.; 552 F. Supp.

131, 150 (D.D.C. 1982), aff'd sub nom, Maryalnd v. United States,

460 U.S. 1001 (1983), quotating United States v. Gillette Co.,

supra, 406 F. Supp. at 716; United States v. Alcan Aluminum, Ltd.,

605 F. Supp. 619, 622 (W.D. Key. 1985).

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VII

Determinative Documents

There are no determinative materials or documents within the

meaning of the APPA that were considered by the United States in

formulating the proposed Final Judgment.

Dated: September 5, 1997.

Respectfully submitted.

Joan S. Huggler,

DC Bar #927244.

Michael P. Harmonis,

PA Bar #17994.

Robert D. Young,

DC Bar #248260.

Attorneys, Antitrust Division, U.S. Department of Justice,

Transportation, Energy and Agriculture Section, Suite 500, 325

Seventh Street, N.W., Washington, D.C. 20530, (202) 307-6456.

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:

W. Todd Miller, Esquire, Baker & Miller PLLC, Suite 615, 700 Eleventh

Street, N.W., Washington, D.C. 20530

(Counsel for Mid-America Dairymen, Inc.)

Jerry L. Beane, Esquire, Strasburger & Price LLP, Suite 4300, 901 Main

Street, Dallas, Texas 75202

(Counsel for Southern Foods Group LP and Milk Products LLC)

Dated: September 5, 1997.

Joan S. Huggler,

DC Bar #9272244.

Antitrust Division, U.S. Department of Justice, 325 Seventh Street,

N.W., Suite 500, Washington, D.C. 20530, (202) 307-6456, (202) 616-

2441.

[FR Doc. 97-25077 Filed 9-19-97; 8:45 am]

BILLING CODE 4410-01-M