# United States, State of Illinois, and State of Missouri v. Allied Waste Industries, Inc. and Browning-Ferris Industries, Inc.; Proposed Final Judgment and Competitive Impact Statement

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## Record

- **Collection:** Federal Register
- **Document type:** Notice
- **Published:** May 4, 1999
- **Citation:** 64 FR 23859

## Text

DEPARTMENT OF JUSTICE

Antitrust Division

United States, State of Illinois, and State of Missouri v. Allied
Waste Industries, Inc. and Browning-Ferris Industries, Inc.; Proposed
Final Judgment and Competitive Impact Statement

Notice is hereby given pursuant to the Antitrust Procedures and
Penalties Act, 15 U.S.C. 16(b)-(h), that a Complaint, Hold Separate
Stipulation and Order, and a proposed Final Judgment were filed with
the United States District Court for the District of Columbia in United
States, State of Illinois and State of Missouri v. Allied Waste
Industries, Inc., and Browning-Ferris Industries, Inc., Civil No.
1:99CV 00894 on April 8, 1999. A Competitive Impact Statement was filed
on April 21, 1999. The proposed Final Judgment is subject to approval
by the Court after the expiration of the statutory 60-day public
comment period and compliance with the Antitrust Procedures and
Penalties Act, 15 U.S.C. 16(b)-(h).
The Complaint alleged that the proposed acquisition by Allied Waste
Industries, Inc. (``Allied'') of certain small container waste hauling
assets from Browning-Ferris Industries, Inc. (``BFI'') in the St. Louis
market would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The
St. Louis market was defined as the City of St. Louis and St. Louis
County in Missouri, and the Illinois counties of St. Clair, Madison,
and Monroe. The proposed Final Judgment, filed at the same time as the
Complaint, required Allied, among other things (1) to divest 12 of
BFI's small container waste hauling routes serving the St. Louis market
and related assets; (2) to offer less restrictive contracts to small
container commercial waste hauling customers, and (3) not to acquire
any commercial waste hauling assets in the St. Louis market for five
years.
A Competitive Impact Statement filed by the United States describes
the Complaint, the proposed Final Judgment, the industry, and the
remedies to be implemented by Allied. Copies of the Complaint, Hold
Separate

[[Page 23860]]

Stipulation and Order, proposed Final Judgment, and the Competitive
Impact Statement are available for inspection in Room 215 in Room 215
of the U.S. Department of Justice, Antitrust Division, 325 7th Street,
NW, Washington, DC, and at the office of the Clerk of the United States
District Court for the District of Columbia, Washington, DC. Copies of
any of these materials may be obtained upon request and payment of a
copying fee.
Public comment is invited within the statutory 60-day comment
period. Such comments, and response thereto, will be published in the
Federal Register and filed with the Court. Comments should be directed
to J. Robert Kramer II, Litigation II Section, Antitrust Division,
United States Department of Justice, 1401 H Street, NW, Suite 3000,
Washington, DC 20530 (telephone: 202-307-0924).
Constance K. Robinson,
Director of Operations and Merger Enforcement Antitrust Division.

HOLD SEPARATE STIPULATION AND ORDER

It is hereby stipulated and agreed by and between the undersigned
parties, subject to approval and entry by the Court, that:

I

Definitions

As used in this Hold Separate Stipulation and Order;
A. ``Allied'' means Allied Waste Industries, Inc. a Delaware
corporation with its headquarters in Scottsdale, Arizona, and includes
its successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
B. ``BFI'' means Browning-Ferris Industries, Inc., a Delaware
corporation with its headquarters in Houston, Texas, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
C. ``Commercial waste hauling'' means the collection and
transportation to a disposal site of trash and garbage (but not medical
waste: organic waste; special waste, such as contaminated soil; sludge;
or recycled, materials) from commercial and industrial customers.
Commercial waste hauling means using front-end load and rear-end load
trucks to service small containers in the St. Louis area. Typical
customers include office and apartment buildings and retail
establishments (e.g., stores and restaurants).
D. ``Relevant Hauling Assets'' means (1) BFI Illinois commercial
waste hauling routes 906, 909, 916 and 940 (as described in Exhibit A
attached to the proposed Final Judgment) and BFI Missouri commercial
waste hauling routes 902, 904, 906, 907, 908, 921, 926 and 940 (as
described in Exhibit B attached to the proposed Final Judgment)
including Saturday service in connection with the customers serviced on
those routes; (2) all tangible assets, including capital equipment,
trucks and other vehicles, containers, interests, permits, and supplies
[except real property nd improvements to real property (i.e.,
buildings)] used in connection with those routes; and (3) all
intangible assets, including hauling-related customer lists, contracts
and accounts used in connection with those routes.
E. ``Small container'' means a 1 to 10 cubic yard container
typically made of steel and often known as a dumpster.
F. ``St. Louis market'' means the City of St. Louis and St. Louis
County, Missouri; and the Illinois counties of St. Clair, Madison and
Monroe.
G. ``Relevant State'' means the state in which the Relevant Hauling
assets are located.

II

Objectives

The Final Judgment filed in this case is meant to ensure Allied's
prompt divestitures of the Relevant Hauling Assets for the purpose of
establishing a viable competitor in the commercial waste hauling
business in the St. Louis market, to remedy the effects that plaintiffs
allege would otherwise result from Allied's acquisition of certain BFI
assets. This Hold Separate Stipulation and Order ensures, prior to such
divestitures, that the Relevant Hauling Assets are an independent,
economically viable, and ongoing business concern; and that competition
is maintained during the pendency of the ordered divestitures.

III

Jurisdiction and Venue

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 United States District Court for the District of Columbia.

IV

Compliance With and Entry of Final Judgment

A. The parties stipulate that a Final Judgment in the form attached
hereto may be filed with 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), and without further notice to any party or other
proceedings, provided that the 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 Allied and by filing that
notice with the Court.
B. Allied shall abide by and comply with the provisions of the
proposed Final Judgment, pending the Judgment's entry by the Court, 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 the
signing of this Stipulation by the parties, comply with all the terms
and provisions of the proposed Final Judgment as though the same were
in full force and effect as an order of the Court.
C. Allied shall not consummate the transaction sought to be
enjoined by the Complaint herein before the Court has signed this Hold
Separate Stipulation and Order.
D. 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.
E. In the event (1) the United States has withdrawn its consent, as
provided in Section IV(A) above, or (2) the proposed Final Judgment is
not entered pursuant to this Stipulation, the time has expired for all
appeals of any Court rule declining entry of the proposed Final
Judgment, and the Court has not otherwise ordered continued compliance
with the terms and provisions of the proposed Final Judgment, then the
parties 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.
F. Allied represents that the divestitures ordered in the proposed
Final Judgment can and will be made, and that Allied will later raise
no claim of hardship or difficulty as grounds for asking the Court to
modify any of the divestiture provisions contained therein.

V

Hold Separate Provisions

Until the divestitures required by the Final Judgment have been
accomplished:
A. Allied shall preserve, maintain, and operate the Relevant
Hauling Assets, as independent competitive

[[Page 23861]]

businesses, with management, sales and operations of such assets held
entirely separate, distinct and apart from those of Allied's other
operations. Allied shall not coordinate the marketing of, or
negotiation or sales by, any Relevant Hauling Asset with Allied's other
operations. Within twenty (20) days after the filing of the Hold
Separate Stipulation and Order, or thirty (30) days after the entry of
this Order, whichever is later, Allied will inform plaintiffs of the
steps Allied has taken to comply with this Hold Separate Stipulation
and Order.
B. Allied shall take steps necessary to ensure that (1) the
Relevant Hauling Assets will be maintained and operated as independent,
ongoing, economically viable and active competitors in the waste
hauling business in the St. Louis market; (2) management of the
Relevant Hauling Assets will not be influenced by Allied; and (3) the
books, records, competitively sensitive sales, marketing and pricing
information, and decision-making concerning the Relevant Hauling
Assets, will be kept separate and apart from Allied's other operations.
Allied's influence over the Relevant Hauling Assets shall be limited to
that necessary to carry out Allied's obligations under this Hold
Separate Stipulation and Order and the Final Judgment.
C. Allied shall use all reasonable efforts to maintain and increase
the sales and revenues of the Relevant Hauling Assets, and shall
maintain at 1998 or at previously approved levels, whichever are
higher, all promotional, advertising, sales, technical assistance,
marketing and merchandising support for the Relevant Hauling Assets.
D. Allied shall provide sufficient working capital to maintain the
Relevant Hauling Assets as economically viable, and competitive ongoing
businesses.
E. Allied shall take all steps necessary to ensure that the
Relevant Hauling Assets are fully maintained in operable condition at
no lower than their current capacity or sales, and shall maintain and
adhere to normal repair and maintenance schedules for the Relevant
Hauling Assets.
F. Allied shall not, except as part of a divestiture approved by
plaintiffs in accordance with the terms of the proposed Final Judgment,
remove, sell, lease, assign, transfer, pledge or otherwise dispose of
any of the Relevant Hauling Assets.
G. Allied shall maintain, in accordance with sound accounting
principles, separate, accurate and complete financial ledgers, books
and records and report on a periodic basis, such as the last business
day of every month, consistent with past practices, the assets,
liabilities, expenses, revenues and income of the Relevant Hauling
Assets.
H. Except in the ordinary course of business or as is otherwise
consistent with this Hold Separate Stipulation and Order, Allied shall
not hire, transfer, terminate, or otherwise alter the salary agreements
for the Allied or BFI employee who, on the date of Allied's signing of
this Hold Separate Stipulation and Order, either: (1) works at a
Relevant Hauling Asset, or (2) is a member of management referenced in
Section V(I) of this Hold Separate Stipulation and Order.
I. Until such time as the Relevant Hauling Assets are divested
pursuant to the terms of the final Judgment, the Relevant Hauling
Assets shall be managed by Stephen Zykan. Mr. Zykan shall have complete
managerial responsibility for the Relevant Hauling Assets of Allied and
BFI, subject to the provisions of this Order and the Final Judgment. In
the event that Mr. Zykan is unable to perform his duties, Allied shall
appoint, subject to the approval of the United States, after
consultation with the Relevant States, a replacement within ten (10)
working days. Should Allied fail to appoint a replacement acceptable to
the United States, after consultation with the Relevant States, within
(10) working days, the United States shall appoint a replacement.
J. Allied shall take no action that would interfere with the
ability of any trustee appointed pursuant to the Final Judgment to
complete the divestitures pursuant to the Final Judgment to purchasers
acceptable to the United States, after consultation with the Relevant
State.
K. This Hold Separate Stipulation and Order shall remain in effect
until consummation of the divestitures contemplated by the Final
Judgment or until further order of the Court.

FOR PLAINTIFF UNITED STATES OF AMERICA:

Arthur A. Feiveson, Illinois Bar No. 3125793
U.S. Department of Justice, Antitrust Division, Litigation II Section,
1401 H Street, NW, #3000, Washington, DC 20530, (202) 307-0901.

FOR DEFENDANT: ALLIED WASTE INDUSTRIES, INC.

Tom D. Smith,
Jones, Day, Reavis & Pogue, 1450 G Street, NW, Washington, DC 20005.

FOR DEFENDANT BROWNING-FERRIS INDUSTRIES, INC.:

David M. Foster,
Fulbright & Jaworski L.L.P., 801 Pennsylvania Avenue, NW., Washington,
DC 20004-2615.

FOR PLAINTIFF STATE OF ILLINOIS

James E. Ryan,
Attorney General.
By:
Christine H. Rosso,
Assistant Attorney General, Antitrust Bureau, Office of the Attorney
General, State of Illinois, 100 W. Randolph, Chicago, Illinois 60601,
(312) 814-5610.

FOR PLAINTIFF STATE OF MISSOURI

Jeremiah W. (Jay) Nixon,
Attorney General.
By:
J. Robert Sears,
Assistant Attorney General, Office of the Attorney General, State of
Missouri, 1530 Rax Court, Jefferson City, Missouri 65109, (573) 751-
3321.

Order

It is so ordered by the Court, this ______ day of ______.

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

United States District Judge

FINAL JUDGMENT

Whereas, plaintiffs, the United States of America, the State of
Illinois, and the State of Missouri, and defendants Allied Waste
Industries, Inc., (``Allied''), and Browning-Ferris Industries, Inc.
(``BFI''), 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 that this Final Judgment shall settle all
claims made by plaintiffs in their Complaint filed on April 8, 1999;
And whereas, defendants have agreed to be bound by the provisions
of this Final Judgment pending its approval by the Court;
And whereas, the essence of this Final Judgment, is, in the event
of the acquisition of certain BFI assets by Allied, the prompt and
certain

[[Page 23862]]

divestiture of the identified assets to assure that competition is not
substantially lessened;
And whereas, plaintiffs require Allied to make certain divestitures
for the purpose of establishing a viable competitor in the commercial
waste hauling business in the St. Louis area;
And whereas, Allied has represented to plaintiffs that the
divestitures ordered herein can and will be made and that Allied will
later raise no claims of hardship or difficulty as grounds for asking
the Court to modify any of the divestiture provisions contained below;
And whereas, the United States, the states of Illinois and Missouri
currently believe that entry of this Final Judgment is in the public
interest;
Now, therefore, before the taking of any testimony, and without
trial or adjudication of any issue of fact or law herein, and upon
consent of the parties hereto, it is hereby ordered, adjudged, and
decreed as follows:

I

Jurisdiction

This Court has jurisdiction over each of the parties hereto and
over the subject matter of this action. The Complaint states a claim
upon which relief may be granted against defendants, as hereinafter
defined, under Section 7 of the Clayton Act, as amended (15 U.S.C. 18).

II

Definitions

As used in this Final Judgment:
A. ``Allied'' means defendant Allied Waste Industries, Inc., A
Delaware corporation with its headquarters in Scottsdale, Arizona and
includes its successors and assigns, and its subsidiaries, divisions,
groups, affiliates, directors, officers, managers, agents, and
employees.
B. ``BFI'' means defendant Browning-Ferris Industries, Inc., a
Delaware corporation with its headquarters in Houston, Texas, and
includes its successors and assigns, and its subsidiaries, divisions,
groups, affiliates, directors, officers, managers, agents, and
employees.
C. ``Commercial waste hauling'' means the collection and
transportation to a disposal site of trash and garbage (but not medical
waste; organic waste; special waste, such as contaminated soil; sludge;
or recycled materials) from commercial and industrial customers.
Commercial waste hauling means using frontend load and rearend load
trucks to service small containers in the St. Louis market. Typical
customers include office and apartment buildings and retail
establishments (e.g., stores and restaurants).
D. ``Small container'' means a 1 to 10 cubic yard container
typically made of steel and often known as a dumpster.
E. ``Relevant Hauling Assets'' means (1) BFI Illinois commercial
waste hauling routes 906, 909, 916 and 940 (as described in Exhibit A)
and BFI Missouri commercial waste hauling routes 902, 904, 906, 907,
908, 921, 926 and 940 (as described in Exhibit B) including Saturday
service in connection with the customers serviced on those routes; (2)
all tangible assets, including capital equipment, trucks and other
vehicles, containers, interests, permits, and supplies [except real
property and improvements to real property (i.e., buildings)] used in
connection with those routes; and (3) all intangible assets, including
hauling-related customer lists, contracts and accounts used in
connection with those routes.
F. ``St. Louis market'' means the City of St. Louis and St. Louis
County, Missouri; and the Illinois counties of St. Clair, Madison and
Monroe.
G. ``Relevant State'' means the state in which the Relevant Hauling
Assets are located.

III

Applicability

A. The provisions of this Final Judgment apply to defendants, their
successors and assigns, subsidiaries, directors, officers, managers,
agents, and employees, and all other persons in active concert or
participation with any of them who shall have received actual notice of
this Final Judgment by personal service or otherwise.
B. Allied shall require, as a condition of the sale or other
disposition of all or substantially all of its relevant hauling assets,
that the acquiring party agree to be bound by the provisions of this
Final Judgment.

IV

Divestitures

A. Allied is hereby ordered and directed in accordance with the
terms of this Final Judgment, within one hundred and twenty (120)
calendar days after the filing of the Hold Separate Stipulation and
Order in this case, or five (5) days after notice of the entry of this
Final Judgment by the Court, whichever is later, to sell the Relevant
Hauling Assets as a viable, ongoing business to a purchaser acceptable
to the United States in its sole discretion, after consultation with
the Relevant State.
B. Allied shall use its best efforts to accomplish the divestitures
as expeditiously and timely as possible. The United States, in its sole
discretion, after consultation with the Relevant State, may extend the
time period for any divestiture an additional period of time not to
exceed sixty (60) calendar days.
C. In accomplishing the divestitures ordered by this Final
Judgment, Allied promptly shall make known, by usual and customary
means, the availability of the Relevant Hauling Assets. Allied shall
inform any person making an inquiry regarding a possible purchase that
the sale is being made pursuant to this Final Judgment and provide such
person with a copy of this Final Judgment. Allied shall also offer to
furnish to all prospective purchasers, subject to customary
confidentiality assurance, all information regarding the Relevant
Hauling Assets customarily provided in a due diligence process except
such information subject to attorney-client privilege or attorney work-
product privilege. Allied shall make available such information to the
plaintiffs at the same time that such information is made available to
any other person.
D. Allied shall not interfere with any negotiations by any
purchaser to employ any Allied (or former BFI employee) who works at,
or whose principal responsibility concerns, any hauling business that
is part of the Relevant Hauling Assets.
E. As customarily provided as part of a due diligence process,
Allied shall permit prospective purchasers of the Relevant Hauling
Assets to have access to personnel and to make such inspection of such
assets; access to any and all environmental, zoning, and other permit
documents and information; and access to any and all financial,
operational, or other documents and information.
F. Allied shall warrant to any and all purchasers of the Relevant
Hauling Assets that each asset will be operational on the date of sale.
G. Allied shall not take any action, direct or indirect, that will
impede in any way the operation of the Relevant Hauling Assets.
H. Allied shall warrant to the purchaser of the Relevant Hauling
Assets that there are no material defects in the environmental, zoning,
or other permits pertaining to the operation of each asset, and that
with respect to all Relevant Hauling assets, Allied will not undertake,
directly or indirectly, following the divestiture of each asset, any
challenges to the environmental,

[[Page 23863]]

zoning, or other permits pertaining to the operation of the asset.
I. Unless the United States, after consultation with the Relevant
State, otherwise consents in writing, the divestitures pursuant to
Section IV, whether by Allied or by trustee appointed pursuant to
Section V of this Final Judgment, shall include all Relevant Hauling
Assets, and be accomplished by selling or otherwise conveying each
asset to a purchaser in such a way as to satisfy the United States, in
its sole discretion, after consultation with the Relevant State, that
the Relevant Hauling Assets can and will be used by the purchaser as
part of a viable, ongoing business or businesses engaged in waste
hauling. The divestiture, whether pursuant to Section IV or Section V
of this Final Judgment, shall be made to a purchaser or purchasers for
whom it is demonstrated to the United States's sole satisfaction, after
consultation with the Relevant State, that the purchaser: (1) Has the
capability and intent of competing effectively in the waste hauling
business in the Relevant Area; (2) has or soon will have the
managerial, operational, and financial capability to compete
effectively in the commercial waste hauling business in the St. Louis
market; and (3) is not hindered by the terms of any agreement between
the purchaser and Allied which gives Allied the ability unreasonably to
raise the purchaser's costs, lower the purchaser's efficiency, or
otherwise interfere in the ability of the purchaser to compete
effectively in the St. Louis market.

V

Appointment of Trustee

A. In the event that Allied has not sold the Relevant Hauling
Assets within the time period specified in Section IV 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
each such asset not sold.
B. After the appointment of a trustee becomes effective, only the
trustee shall have the right to sell the Relevant Hauling Assets. The
trustee shall have the power and authority to accomplish any and all
divestitures at the best price then obtainable upon a reasonable effort
by the trustee, subject to the provisions of Sections IV and VIII of
this Final Judgment, and shall have such other powers as the Court
shall deem appropriate. Subject to Section V(C) of this Final Judgment,
the trustee shall have the power and authority to hire at the cost and
expense of Allied any investment bankers, attorneys, or agents
reasonably necessary in the judgment of the trustee to assist in the
divestitures, and such professionals and agents shall be accountable
solely to the trustee. The trustee shall have the power and authority
to accomplish the divestitures at the earliest possible time to a
purchaser or purchasers acceptable to the United States, upon
consultation with the Relevant State, and shall have such other powers
as this Court shall deem appropriate. Allied shall not object to a sale
by the trustee on any grounds other than the trustee's malfeasance. Any
such objections by Allied must be conveyed in writing to the relevant
plaintiffs and the trustee within ten (10) calendar days after the
trustee has provided the notice required under Section VI of this Final
Judgment.
C. The trustee shall serve at the cost and expense of Allied, on
such terms and conditions as the Court may prescribe, and shall account
for all monies derived from the sale of each asset 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 Allied 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 divested business 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. Allied shall use its best efforts to assist the trustee in
accomplishing the required divestitures, including best efforts to
effect all necessary regulatory approvals. 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 the businesses to be divested, and Allied
shall develop financial or other information relevant to the businesses
to be divested customarily provided in a due diligence process as the
trustee may reasonably request, subject to customary confidentiality
assurances. Allied shall permit bona fide prospective acquirers of each
Relevant Hauling Asset to have reasonable access to personnel and to
make such inspection of physical facilities and any and all financial,
operational or other documents and other information as may be relevant
to the divestitures required by this Final Judgment.
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 divestitures ordered under this Final Judgment,
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. Such reports shall include the name,
address and telephone number of each person who, during the preceding
month, 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 business to be divested,
and shall describe in detail each contact with any such person during
that period. The trustee shall maintain full records of all efforts
made to sell the businesses to be divested.
F. If the trustee has not accomplished such divestitures 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 divestitures, (2) the reasons, in
the trustee's judgment, why the required divestitures have not been
accomplished, and (3) the trustee's recommendations, provided, however,
that to the extent such reports contain information that the trustee
deems confidential, such reports shall not be filed in the public
docket of the Court. The trustee shall at the same time furnish such
report to the parties, who shall each have the right to be heard and to
make additional recommendations consistent with the purpose of the
trust. The Court shall enter thereafter such orders as it shall deem
appropriate in order to carry out the purpose of the trust which may,
if necessary, include extending the trust and the term of the trustee's
appointment by a period requested by the United States.

VI

Notification

Within two (2) business days following execution of a definitive
agreement, contingent upon compliance with the terms of this Final
Judgment, to effect, in whole or in part, any proposed divestiture
pursuant to Sections IV or V of this Final Judgment, Allied or the
trustee, whichever is then responsible for effecting the divestiture,
shall notify plaintiffs of the proposed divestiture. If the trustee is
responsible, it shall similarly notify Allied. The notice shall set
forth the details of the proposed transaction and list the name,
address, and telephone number of each

[[Page 23864]]

person not previously identified who offered to, or expressed an
interest in or a desire to, acquire any ownership interest in the
business to be divested that is the subject of the binding contract,
together with full details of same. Within fifteen (15) calendar days
of receipt by plaintiffs of such notice, the United States, in its sole
discretion, after consultation with the Relevant State, may request
from Allied, the proposed purchaser, or any other third party
additional information concerning the proposed divestiture and the
proposed purchaser. Allied and the trustee shall furnish any additional
information requested from them 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 plaintiffs have been provided the
additional information request from Allied, the proposed purchaser, and
any third party, whichever is later, the United States, after
consultation with the Relevant State, shall provide written notice to
Allied 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 Allied and the trustee that it does not object, then
the divestiture may be consummated, subject only to Allied's limited
right to object to the sale under Section V(B) of this Final Judgment.
Upon objection by the United States, a divestiture proposed under
Section IV or Section V shall not be consummated. Upon objection by
Allied under the provision in Section V(B), a divestiture proposed
under Section V shall not be consummated unless approved by the Court.

VII

Affidavits

A. Within twenty (20) calendar days of the filing of the Hold
Separate Stipulation and Order in this matter and every thirty (30)
calendar days thereafter until the divestiture has been completed
whether pursuant to Section IV or Section V of this Final Judgment,
Allied shall deliver to plaintiffs an affidavit as to the fact and
manner of compliance with Sections IV and V of this Final Judgment.
Each such affidavit shall include, inter alia, the name, address, and
telephone number of each person who, at any time after the period
covered by the last such report, made an offer to acquire, expressed an
interest in acquiring, entered into negotiations to acquire, or was
contacted or made an inquiry about acquiring, entered into negotiations
to acquire, or was contacted or made an inquiry about acquiring, and
interest in the businesses to be divested, and shall describe in detail
each contact with any such persons during that period. Each such
affidavit shall also include a description of the efforts that Allied
has taken to solicit a buyer for any and all Relevant Hauling Assets
and to provide requested information to prospective purchasers,
including the limitations, if any, on such information. Assuming the
information set forth in the affidavit is true and complete, any
objection by the Untied States, after consultation with the Relevant
State, to information provided by Allied, including limitations on
information, shall be made within fourteen (14) days of receipt of such
affidavit.
B. Within twenty (20) calendar days of the filing of the Hold
Separate Stipulation and Order in this matter. Allied shall deliver to
plaintiffs an affidavit which describes in detail all actions Allied
has taken and all steps Allied had implemented on an on-going basis to
preserve the Relevant Hauling Assets pursuant to Section VIII of this
Final Judgment and the Hold Separate Stipulation and Order entered by
the Court. The affidavit also shall describe, but not be limited to,
Allied's efforts to maintain and operate each Relevant Hauling Asset as
an active competitor, maintain the management, staffing, sales,
marketing and pricing of each asset, and maintain each asset in
operable condition at current capacity configurations. Allied shall
deliver to plaintiffs an affidavit describing any changes to the
efforts and actions outlined in Allied's earlier affidavit(s) filed
pursuant to this Section within fifteen (15) calendar days after the
change is implemented.
C. Until one year after such divestiture has been completed, Allied
shall preserve all records of all efforts made to preserve the Relevant
Hauling Assets and to effect the ordered divestitures.

VIII

Hold Separate Order

Until the divestitures required by the Final Judgment have been
accomplished, Allied shall take all steps necessary to comply with the
Hold Separate Stipulation and Order entered by this Court. Defendants
shall take no action that would jeopardize the sale of the Relevant
Hauling Assets.

IX

Financing

Allied is ordered and directed not to finance all or any part of
any acquisition by any person made pursuant to Sections IV or V of this
Final Judgment.

X

Contractual Revisions

A. In accordance with paragraph X B, below, Allied shall alter the
contracts it uses with its smaller container solid waste commercial
customers in the St. Louis market to the form contained in the attached
Exhibit C, except for contracts for terms of less than two years.
B. Except for contracts for terms of less than two years, Allied
shall offer contracts in the form attached as Exhibit C to all new
small container solid waste commercial customers or customers that sign
new contracts for small container solid waste commercial service
effective on the date Allied acquires the FBI assets. Allied shall
offer such contracts to all other small container solid waste
commercial customers in the St. Louis market by December 1, 1999.

XI

Acquisitions

Allied is hereby ordered and directed that for a period of five (5)
years after notice of the entry of this Final Judgment, Allied shall
not acquire any commercial waste hauling company, any commercial waste
hauling route, or any relevant hauling assets located in the City of
St. Louis, Missouri; St. Louis County, Missouri; and in the Illinois
counties of St. Clair, Madison and Monroe.

XII

Compliance Inspection

For purposes of determining or securing compliance with the Final
Judgment and subject to any legally recognized privilege, from time to
time:
A. Duly authorized representatives of the United States Department
of Justice, upon written request of the Attorney General or of the
Assistant Attorney General in charge of the antitrust Division, or upon
written request of duly authorized representatives of the Attorney
General's Office of any Relevant State, and on reasonable notice to
Allied made to its principal offices, shall be permitted:

(1) Access during office hours of Allied to inspect and copy all
books, ledgers, accounts, correspondence, memoranda, and other
records and documents in the possession or under the control of
Allied, who may have counsel present, relating to the matters
contained in this Final judgment and the Hold Separate Stipulation
and Order; and
(2) Subject to the reasonable convenience of Allied and without
restraint or interference from it, to interview, either

[[Page 23865]]

informally or on the record, its officers, employees, and agents,
who may have counsel present, regarding any such matters.

B. Upon the written request of the Attorney General or of the
Assistant Attorney General in charge of the Antitrust Division, or upon
the written request of the Attorney General's Office of any Relevant
State, Allied shall submit such written reports, under oath if
requested, with respect to any matter contained in the Final Judgment
and the Hold Separate Stipulation and Order.
C. No information or documents obtained by the means provided in
Sections VII or XII of this Final Judgment shall be divulged by a
representative of the plaintiffs to any person other than a duly
authorized representative of the Executive Branch of the United States,
or the Attorney General's Office of any Relevant State, except in the
course of legal proceedings to which the United States or any relevant
State 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 Allied
to plaintiffs, Allied represents and identifies in writing the material
in any such information or documents to which a claim of protection may
be asserted under Rule 26(c)(7) of the Federal Rules of Civil
Procedure, and Allied marks each pertinent page of such material,
``Subject to claim of protection under Rule 26(c)(7) of the Federal
Rules of Civil Procedure,'' then ten (10) calendar days notice shall be
given by plaintiffs to Allied prior to divulging such material in any
legal proceeding (other than a grand jury proceeding) to which Allied
is not a party.

XIII

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.

XIV

Termination

Unless this Court grants an extension, this Final Judgment will
expire upon the tenth anniversary of the date of its entry.

XV

Public Interest

Entry of this Final Judgment is in the public interest.

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

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

United States District Judge

COMPETITIVE IMPACT STATEMENT

The United States, pursuant to Section 2(b) of the Antitrust
Procedures and Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files
this Competitive Impact Statement related 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 under Section
15 of the Clayton Act, 15 U.S.C. 25, on April 8, 1999, alleging that
the proposed acquisition of Browning-Ferris Industries, Inc.'s
(``BFI'') small container commercial waste hauling assets in the St.
Louis market by Allied Waste Industries, Inc. (``Allied'') would
constitute a violation of Section 7 of the Clayton Act, 15 U.S.C. 18.
The States of Illinois and Missouri, by and through their respective
Attorneys General, are co-plaintiffs with the United States in this
action.\1\
---------------------------------------------------------------------------

\1\ The APPA obligates only the United States to file a
Competitive Impact Statement.
---------------------------------------------------------------------------

The Complaint alleges that the effect of the acquisition may be
substantially to lessen competition in small containerized commercial
waste hauling services in the St. Louis market, which includes the City
of St. Louis and St. Louis County in Missouri, and the Illinois
counties of St. Clair, Madison and Monroe.
Plaintiffs seek, among other relief, a permanent injunction
preventing the defendants from, in any manner, combining their small
container commercial waste hauling assets in the St. Louis market. By
the terms of a Hold Separate Stipulation and Order, which was filed
simultaneously with the proposed Final Judgment, defendant Allied must
take certain steps to ensure that, until the required divestiture has
been accomplished, the BFI assets as outlined in the proposed Final
Judgment will be held separate and apart from defendant Allied's other
assets and businesses. Allied must, until the required divestiture is
accomplished, preserve and maintain the specified BFI assets as
saleable and economically viable ongoing concerns.
The United States, its co-plaintiffs, and the defendants also have
filed a Hold Separate Stipulation and Order by which the parties
consented to the entry of a proposed Final Judgment designed to
eliminate the anticompetitive effects of the acquisition. Under the
proposed Final Judgment, as explained more fully below, Allied would be
required within 120 days after the filing of the Hold Separate
Stipulation and Order, or 5 days after notice of the entry of the Final
Judgment by the Court, to divest, as viable business operations, a
specified number of BFI's small container commercial waste hauling
routes and assets serving the St. Louis market. If Allied did not do so
within the time frame in the proposed Final Judgment, a trustee
appointed by the Court would be empowered for an additional six months
to sell those assets. If the trustee is unable to do so in that time,
the Court could enter such orders as it shall deem appropriate to carry
out the purpose of the trust, which may, if necessary, include
extending the trust and the trustee's appointment by a period requested
by the United States, after consultation with its co-plaintiffs.
Additionally, under the proposed Final Judgment, as explained more
fully below, defendant Allied would be required to offer less
restrictive contracts to its small container commercial waste hauling
customers in the St. Louis market; and be prohibited from acquiring any
commercial waste hauling company, any commercial waste hauling route,
or any relevant hauling assets in the St. Louis market for 5 years
after notice of the entry of proposed Final Judgment.
The United States, its co-plaintiffs, and the defendants 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 proposed Final
Judgment and to punish violations thereof.

II

Description of the Events Giving Rise to the Alleged Violation

Allied and BFI are two of the three largest companies engaged in
the commercial waste hauling and disposal business, with operations
throughout the United States. In 1998, Allied reported domestic
revenues of nearly $1.6 billion while BFI reported domestic revenues of
nearly $4.7 billion.

[[Page 23866]]

Allied and BFI agreed to a sale to Allied of BFI's small container
commercial waste hauling assets in St. Louis market, as part of an
asset swap agreement dated February 11, 1999.

A. The Solid Waste Hauling Industry

Solid waste hauling involves the collection of paper, food,
construction material and other solid waste from homes, businesses and
industries, and the transporting of that waste to a landfill or other
disposal site. These services may be provided by private haulers
directly to residential, commercial and industrial customers, or
indirectly through municipal contracts and franchises.
Service to commercial customers accounts for a large percentage of
total hauling revenues. Commercial customers include restaurants, large
apartment complexes, retail and wholesale stores, office buildings, and
industrial parks. These customers typically generate a substantially
larger volume of waste than that generated by residential customers.
Waste generated by commercial customers is generally placed in metal
containers of one to ten cubic yards provided by their hauling company.
One to ten cubic yard containers are called ``small containers.'' Small
containers are collected primarily by frontend load vehicles that lift
the containers over the front of the truck by means of a hydraulic
hoist and empty them into the storage section of the vehicle, where the
waste is compacted. Specially-rigged rearend load vehicles can also be
used to service some commercial small container customers, but these
trucks generally are not as efficient as frontend load vehicles and are
limited in the sizes of containers they can safely handle. Frontend
load vehicles can drive directly up to a container and hoist the
container in a manner similar to a forklift hoisting a pallet: the
containers do not need to be manually rolled into position by a truck
crew as with a rearend load vehicle. Service to commercial customers
that use small containers is called ``small containerized hauling
service.''
Solid waste hauling firms also provide service to residential and
industrial (or ``roll-off'') customers. Residential customers,
typically households and small apartment complexes that generate small
amounts of waste, use noncontainerized solid waste hauling service,
normally placing their waste in plastic bags or trash cans at curbside.
Rearend load vehicles are generally used to collect waste from
residential customers and from those commercial customers that generate
relatively small quantities of solid waste, similar in the amount and
kind to those generated by residential customers. Generally, rearend
loaders use a one or two person crew to manually load the waste into
the rear of the vehicle.
Industrial or roll-off customers include factories and construction
sites. These customers either generate non-compactible waste, such as
concrete or building debris, or very large quantities of compactible
waste. They deposit their waste into very large containers (usually 20
to 40 cubic yards) that are loaded onto a roll-off truck and
transported individually to the disposal site where they are emptied
before being returned to the customer's premises. Some customers, like
shopping malls, use large, roll-off containers with compactors. This
type of customer generally generates compactible trash, like cardboard,
in very great quantities; it is more economical for this type of
customer to use roll-off service with compactor than to use a number of
small containers picked up multiple times a week.

B. Small Containerized Commercial Waste Hauling Service

There are no practical substitutes for small containerized
commercial waste hauling service. Small containerized commercial waste
hauling service customers will not generally switch to noncontainerized
service because it is too impractical and costly for those customers to
bag and carry their trash to the curb for hand pick-up. Small
containerized commercial waste hauling service customers also value the
cleanliness and relative freedom from scavengers afforded by that
service. Similarly, roll-off service is much too costly and takes up
too much space for most small containerized commercial waste hauling
service customers. Only customers that generate the largest volumes of
solid waste can economically consider roll-off service, and for
customers that do generate large volumes of waste, roll-off service is
usually the only viable option. Accordingly, small container commercial
waste hauling service is a line of commerce and a relevant product
market.
Solid waste hauling services are generally provided in very
localized areas. Route density (a large number of customers that are
close together) is necessary for small containerized commercial waste
hauling firms to be profitable. In addition, it is not economically
efficient for heavy trash hauling equipment to travel long distances
from customers without collecting significant amounts of waste. Thus,
it is not efficient for a hauler to serve major metropolitan areas from
a distant base. Haulers, therefore, generally establish garages and
related facilities within each major local area served. Local laws or
regulations that restrict where waste can be disposed of may further
localize markets. Flow control regulations designate the disposal
facilities where trash picked up within a geographic area must be
disposed. Other local regulations may also prohibit the depositing of
trash from outside a particular jurisdiction in disposal facilities
located within that jurisdiction. These laws and regulations dictate
that haulers operate only in these local jurisdictions so that they may
use the designated disposal facilities.
The Complaint alleges the St. Louis market as a relevant geographic
market for small containerized commercial waste hauling services. This
market includes the City of St. Louis and St. Louis County in Missouri,
and the Illinois counties of St. Clair, Madison and Monroe.
Allied and BFI compete with each other in small containerized
commercial waste hauling services in the relevant geographic market,
which is highly concentrated and becomes substantially more
concentrated as a result of the proposed acquisition. In the St. Louis
market, Allied and BFI each have over a 25% share of the small
containerized commercial waste hauling business. The acquisition would
increase the Herfindahl-Hirschmann Index (``HHI''),\2\ a measure of
market concentration, by about 1400 to about 3900 in the St. Louis
market.
---------------------------------------------------------------------------

\2\ The Herfindahl-Hirschmann Index (``HHI'') is a measure of
market concentration calculated by squaring the market share of each
firm competing in the market and then summing the resulting numbers.
For example, for a market consisting of four firms with shares of
30, 30, 20, and 20 percent, the HHI is 2600 (30 squared (900) plus
30 squared (900) plus 20 squared (400) plus 20 squared (400) =
2600). The HHI, which takes into account the relative size and
distribution of the firms in a market, ranges from virtually zero to
10,000. The index approaches zero when a market is occupied by a
large number of firms of relatively equal size. The index increases
as the number of firms in the market decreases and as the disparity
in size between the leading firms and the remaining firms increases.
---------------------------------------------------------------------------

A new entrant cannot constrain the prices of larger incumbents
until it achieves minimum efficient scale and operating efficiencies
comparable to the incumbent firms. In small containerized commercial
waste hauling service, achieving comparable operating efficiencies
required achieving route destiny comparable to existing firms, which
typically takes a substantial

[[Page 23867]]

period of time. A substantial barrier to entry is the use of long-term
contracts coupled with selective pricing practices by incumbent firms
to deter new entrants into small containerized commercial waste hauling
service and to hinder them in winning enough customers to build
efficient routes. Further, even if a new entrant endures and grows to a
point near minimum efficient scale, the entrant will often be purchased
by an incumbent firm and will be removed as a competitive threat.
Solid waste hauling is an industry highly susceptible to tacit or
overt collusion among competing firms. Overt collusion has been
documented in more than a dozen criminal and civil antitrust cases
brought in the last decade and a half. Such collusion typically
involves customer allocation and price fixing, and where it has
occurred, has been shown to persist for many years.
The elimination of one of a small number of significant
competitors, such as would occur as a result of the proposed
transaction in the St. Louis market, significantly increases the
likelihood that consumers in these markets are likely to face higher
prices or poorer quality service.
Based on the foregoing and other facts, the Complaint alleges that
the effect of the proposed acquisition may be substantially to lessen
competition in the above-described geographic area in the small
containerized commercial waste hauling service market in violation of
Section 7 of the Clayton Act.

III

Explanation of the Proposed Final Judgment

The provisions of the proposed Final Judgment are designed to
eliminate the anticompetitive effects of the acquisition in small
containerized commercial waste hauling services in the St. Louis market
by establishing a new, independent and economically viable competitor
in that market. The proposed Final Judgment requires Allied, within 120
days after the filing of the Hold Separate Stipulation and Order, or 5
days after notice of the entry of the Final Judgment by the Court, to
divest, as a viable ongoing business or businesses, a specified number
of BFI's small container commercial waste hauling routes and assets
serving the St. Louis market. The divestiture would include both the
small containerized commercial waste hauling service assets and other
assets as may be necessary to insure the viability of the small
container business. If Allied cannot accomplish this divestiture within
the above-described period, the proposed Final Judgment provides that,
upon application by the United States as plaintiff, the Court will
appoint a trustee to effect the divestiture.
The proposed Final Judgment provides that the assets must be
divested in such a way as to satisfy plaintiff United States (after
consultation with the states of Illinois and Missouri) that the
operations can and will be operated by the purchaser or purchasers as a
viable, ongoing business or businesses that can compete effectively in
the relevant market. Similarly, if the divestiture is accomplished by
the trustee, the assets must be divested in such a way as to satisfy
plaintiff United States (after consultation with the states of Illinois
and Missouri) that the business or businesses can and will be operated
as viable, independent competitors by the purchaser or purchasers. The
defendants must take all reasonable steps necessary to accomplish the
divestiture and shall cooperate with prospective purchasers and, if one
is appointed, with the trustee.
If a trustee is appointed, the proposed Final Judgment provides
that Allied will pay all costs and expenses of the trustee. The
trustee's commission will be structured so as to provide an incentive
for the trustee based on the price obtained and the speed with which
divestiture is accomplished. After his or her appointment becomes
effective, the trustee will file monthly reports with the parties and
the Court, setting forth the trustee's efforts to accomplish
divestiture. At the end of six months, if the divestiture has not been
accomplished, the trustee and the parties will make recommendations to
the Court which shall enter such orders as appropriate in order to
carry out the purpose of the trust, including extending the trust or
the term of the trustee's appointment.
The proposed Final Judgment also requires Allied to offer less
restrictive contracts (attached to the proposed Final Judgment as
Exhibit C) to small containerized commercial waste hauling customers in
the St. Louis market. These contractual changes involve shortening from
three years to two years the term of contracts Allied uses, limiting
renewals to one year periods, and substantially reducing the amount of
liquidated damages. The proposed Final Judgment requires that these
revised contracts shall be offered to all new, small, containerized
commercial waste hauling customers and to existing customers that sign
new contracts for small containerized commercial waste hauling service,
effective beginning the date Allied acquires the BFI assets. By
December 1, 1999, Allied must offer the revised contract to all other
small containerized commercial waste hauling service customers in the
St. Louis market.
The United States concluded that a change in the types of contracts
used with small containerized commercial waste hauling service
customers in the St. Louis market, in conjunction with the required
divestiture, will adequately address the competitive concerns posed by
Allied's acquisition of the BFI assets. Several factors led to the
decision, including the number of existing competitors in the market;
the size of the population and number and density of commercial
establishments requiring small containerized commercial waste hauling
service; and the number of haulers that currently do not provide, but,
absent the long-term contracts that now exist, could provide small
containerized commercial waste hauling service in the market. Requiring
Allied to offer less restrictive contracts within the St. Louis market
eliminates a major barrier to entry and expansion. Haulers already
serving the market will be able to more easily expand their current or
build new routes and nearby haulers will be able to build routes, thus
constraining any possible anticompetitive price increase by the post-
acquisition firm.
The proposed Final Judgment also prohibits Allied from acquiring
any commercial waste hauling company, any commercial waste hauling
route, or any relevant hauling assets in the St. Louis market for 5
years after notice of the entry of the proposed Final Judgment. The
United States concluded that this restriction would ensure continued
competition in the market by preventing Allied from acquiring small
containerized commercial waste hauling routes which would have had the
effect of undercutting the relief required by the proposed Final
Judgment by effecting the entry and expansion of other market
participants and stifling competition in small containerized commercial
waste hauling.
The relief sought in the St. Louis market alleged in the complaint
has been tailored to insure that, given the specific conditions in this
market, the relief will protect consumers of small containerized
commercial waste hauling services from higher prices and poorer quality
service that might otherwise result from the acquisition.

[[Page 23868]]

IV

Remedies Available to Potential Private Litigants

Section 4 of the Clayton Act (15 U.S.C. 15) provides that any
person who has been injured as a result of conduct prohibited by the
antitrust laws may bring suit in federal court to recover three times
the damages the person has suffered, as well as costs and reasonable
attorneys' fees. Entry of the proposed Final Judgment will neither
impair nor assist the bringing of any private antitrust damage action.
Under the provisions of Section 5(a) of the Clayton Act (15 U.S.C.
16(a)), the proposed Final Judgment has no prima facie effect in any
subsequent private lawsuit that may be brought against the defendants.

V

Procedures Available for Modification of the Proposed Final Judgment

The United States and defendants have stipulated that the proposed
Final Judgment may be entered by the Court after compliance with the
provisions of the APPA, provided that the United States has not
withdrawn its consent. The APPA conditions entry upon the Court's
determination that the proposed Final Judgment is in the public
interest.
The APPA provides a period of at least 60 days preceding the
effective date of the proposed Final Judgment within which any person
may submit to the United States written comments regarding the proposed
Final Judgment. Any person who wishes to comment should do so within
(60) days of the date of publication of this Competitive Impact
Statement in the Federal Register. The United States will evaluate and
respond to the comments. All comments will be given due consideration
by the Department of Justice, which remains free to withdraw its
consent to the proposed Final Judgment at any time prior to entry. The
comments and the response of the United States will be filed with the
Court and published in the Federal Register.
Written comments should be submitted to: J. Robert Kramer II,
Chief, Litigation II Section, Antitrust Division, United States
Department of Justice, 1401 H Street, NW, Suite 3000, Washington, DC
20530.
The proposed Final Judgment provides that the Court retains
jurisdiction over this action, and the parties may apply to the Court
for any order necessary or appropriate for the modification,
interpretation, or enforcement of the Final Judgment.

VI

Alternatives to the Proposed Final Judgment

The United States considered, as an alternative to the proposed
Final Judgment, litigation against defendants Allied and BFI. The
United States could have brought suit and sought preliminary and
permanent injunctions against Allied's acquisition of the BFI assets.
The United States is satisfied, however, that the divestiture of the
assets, the contract relief, and the prohibition on acquisitions, as
outlined in the proposed Final Judgment, will promote small
containerized commercial waste hauling service competition in the St.
Louis market and lower entry barriers that would otherwise
substantially lessen competition in this market. The United States is
satisfied that the proposed relief will prevent the acquisition from
having anticompetitive effects in the St. Louis market, will maintain
the structure of the St. Louis market that existed prior to the
acquisition, will preserve the existence of independent competitors in
this area, and will allow for new entry and expansion by existing firms
in this market.

VII

Standard of Review Under the APPA for the Proposed Supplemental Order

The APPA requires that proposed consent judgments in antitrust
cases brought by the United States be subject to a sixty-day comment
period, after which the Court shall determine whether entry of the
proposed supplemental Order ``is in the public interest.'' In making
that determination, the Court may consider--
(1) The competitive impact of such judgment, including termination
of alleged violations, provisions for enforcement and modification,
duration or relief sought, anticipated effects of alternative remedies
actually considered, and any other considerations bearing upon the
adequacy of such judgment;
(2) The impact of entry of such judgment upon the public generally
and individuals alleging specific injury from the violations set forth
in the complaint including consideration of the public benefit, if any,
to be derived from a determination of the issues at trial.

15 U.S.C. 16(e) (emphasis added). As the Court of Appeals for the
District of Columbia Circuit recently held, the APPA permits a court to
consider, among other things, the relationship between the remedy
secured and the specific allegations set forth in the government's
complaint, whether the decree is sufficiently clear, whether
enforcement mechanisms are sufficient, and whether the decree may
positively harm third parties. See United States v. Microsoft, 56 F. 3d
1448, 1458-62 (D.C. Cir. 1995). The courts have recognized that the
term `` `public interest' take[s] meaning from the purposes of the
regulatory legislation.'' NAACP v. Federal Power Comm'n, 425 U.S. 662,
669 (1976). Since the purpose of the antitrust laws is to preserve
``free and unfettered competition as the rule of trade,'' Northern
Pacific Railway Co. v. United States, 356 U.S. 1, 4 (1958), the focus
of the ``public interest'' inquiry under the APPA is whether the
proposed Final Judgment would serve the public interest in free and
unfettered competition. United States v. American Cyanamid Co., 719 F.
2d 558, 565 (2d Cir. 1983), cert. denied, 465 U.S. 1101 (1984); United
States v. Waste Management, Inc., 1985-2 Trade Cas. para.66,651, at
63,046 (D.D.C. 1985). In conducting this inquiry, ``the Court is
nowhere compelled to go to trial or to engage in extended proceedings
which might have the effect of vitiating the benefits of prompt and
less costly settlement through the consent decree process.'' \3\
Rather,
---------------------------------------------------------------------------

\3\ 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. 93-1463, 93rd
Cong. 2d Sess. 8-9, reprinted in (1974) U.S. Code Cong. & Ad. News
6535, 6538.

[a]bsent 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 1448 (D.C. Cir. 1995). Precedent
requires that:

[[Page 23869]]

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.\4\

\4\United States v. Bechtel, 648 F. 2d at 666 (citations
omitted) (emphasis added); see United States v. BNS, Inc., 858 F. 2d
at 463; United States v. National Broadcasting Co., 449 F. Supp.
1127, 1143 (C.D. Cal. 1978); United States v. Gillette Co., 406 F.
Supp. at 716. See also United States v. American Cyanamid Co., 719
F. 2d at 565.
---------------------------------------------------------------------------

A proposed consent decree is an agreement between the parties which
is reached after exhaustive negotiations and discussions. Parties do
not hastily and thoughtlessly stipulate to a decree because, in doing
so, they

waive their right to litigate the issues involved in the case and
thus save themselves the time, expense, and inevitable risk of
litigation. Naturally, the agreement reached normally embodies a
compromise; in exchange for the saving of cost and the elimination
of risk, the parties each give up something they might have won had
they proceeded with the litigation.

United States v. Armour & Co., 402 U.S. 673, 681 (1971).
The proposed Final Judgment therefore, should not be reviewed under
a standard of whether it is certain to eliminate every anticompetitive
effect of a particular practice or whether it mandates certainty of
free competition in the future. Court approval of a final judgment
requires a standard more flexible and less strict than the standard
required for a finding of liability. ``[A] proposed decree must be
approved even if it falls short of the remedy the court would impose on
its own, as long as it falls within the range of acceptability or is
`within the reaches of public interest.' (citations omitted).'' \5\
---------------------------------------------------------------------------

\5\ United States v. American Tel. and Tel Co., 552 F. Supp.
131, 150 (D.D.C. 1982), aff'd sub nom. Maryland v. United States,
460 U.S. 1001 (1983) quoting United States v. Gillette Co., supra,
406 F. Supp. at 716; United States v. Alcan Aluminum, Ltd., 605 F.
Supp. 619, 622 (W.D. Ky. 1985).
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VIII

Determinative Documents

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: April 22, 1999.
Respectfully submitted,
Arthur A. Feiveson,
IL Bar #3125793.
David R. Bickel,
DC Bar #393409.
Thomas J. Horton
Denise Cheung,
U.S. Department of Justice, Antitrust Division, Litigation II Section,
1401 H Street, NW, Suite 3000, Washington, DC 20530, (202) 307-0924.

Certificate of Service

I hereby certify that a copy of the foregoing has been served upon
Allied Waste Industries, Inc., Browning-Ferris Industries, Inc., the
Office of the Attorney General of the State of Illinois, and the Office
of the Attorney General of the State of Missouri, by placing a copy of
this Competitive Impact Statement in the U.S. mail, directed to each of
the above-named parties at the address given below, this 22d day of
April, 1999.

Allied Waste Industries, Inc., c/o Tom D. Smith, Jones Day Reavis &
Pogue, Metropolitan Square, 1450 G Street, NW, Washington, DC 20005-
2088
Browning-Ferris Industries, Inc., c/o David M. Foster, Fulbright &
Jaworski, 801 Pennsylvania Avenue, NW, Washington, DC 20004-2615
State of Illinois, Christine H. Rosso, Assistant Attorney General,
Office of the Attorney General, Antitrust Bureau, 100 W. Randolph,
Chicago, IL 60601
State of Missouri, J. Robert Sears, Assistant Atorney General,
Office of the Attorney General, 1530 Rax Court, Jefferson City,
Missouri 65109
Arthur A. Feiveson,
Attorney, U.S. Department of Justice, Antitrust Division, 1401 H
Street, NW, Suite 3000, Washington, DC 20530, (202) 307-0924.
[FR Doc. 99-11076 Filed 5-3-99; 8:45 am]
BILLING CODE 4410-11-M

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A99-11076. Public record. Not legal advice.