United States v. Florida Rock Industries, Inc., et al.; Proposed Final Judgment and Competitive Impact Statement
Federal RegisterJun 16, 1999
Ask Donna
What actually matters in this document.
Text
DEPARTMENT OF JUSTICE
Antitrust Division
United States v. Florida Rock Industries, Inc., et al.; Proposed
Final Judgment and Competitive Impact Statement
Notice is hereby given pursuant to the Antitrust Procedures and
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment,
Stipulation and Order, and Competitive Impact Statement have been filed
with the United States District Court in the Middle District of
Florida, Jacksonville Division, Civil No. 99-516-CIV-J-20A.
On May 26, 1999, the United States filed a Complaint alleging that
the proposed acquisition by Florida Rock of the stock of Harper Bros.
and Commercial Testing, Inc. would violate section 7 of the Clayton
Act, 15 U.S.C. 18. The proposed Final Judgment, filed the same time as
the Complaint, requires Florida Rock to divest the Alico Road Quarry,
Fort Myers, Florida, the Palmdale Sand Mine, Palmdale, Florida, and
related assets that it will obtain in connection with the acquisition
of Harper Bros. and Testing.
Public comment is invited within the statutory 60-day comment
period. Such comments and responses thereto will be published in the
Federal Register and filed with the Court. Comments should be directed
to J. Robert Kramer, Chief, Litigation II Section, Antitrust Division,
United States Department of Justice, 1401 H Street, NW., Suite 3000,
Washington, DC 20530 (telephone: 202/307-0924).
Copies of the Complaint, Stipulation and Order, Proposed Final
Judgment, and Competitive Impact Statement are available for inspection
in Room 215 of the U.S. Department of Justice, Antitrust Division, 325
7th Street, NW., Washington, DC 20530, (202) 514-2841. Copies of these
materials may be obtained upon request and payment of a copying fee.
Constance K. Robinson,
Director of Operations & Merger Enforcement.
United States District Court, Middle District of Florida,
Jacksonville Division
United States of America, Plaintiff, v. Florida Rock Industries,
Inc.; Harper Bros., Inc.; Commercial Testing, Inc.; and Daniel R.
Harper, Defendants [Civil No.: 99-516-CIV-J-20A].
Stipulation and Order
It is stipulated by and between the undersigned parties, by their
respective attorneys, as follows:
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 United States District Court for the Middle District of
Florida.
2. The parties stipulate that a Final Judgment in the form hereto
attached may be filed and entered by the Court, upon the motion of any
party or upon the Court's own motion, at any time after compliance with
the requirements of the Antitrust Procedures and Penalties Act (15
U.S.C. 16), 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 defendants and by filing
that notice with the Court, on or before September 15, 1999.
3. Defendants shall abide by and comply with the provisions of the
proposed Final Judgment pending entry 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 the signing
of this Stipulation by the parties, comply with all the terms and
provisions of the proposed Final Judgment as though they were in full
force and effect as an order of the Court.
4. Defendants shall not consummate the transaction sought to be
enjoined by the Complaint herein before the Court has signed the Hold
Separate Stipulation and Order.
5. 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.
6. In the event (a) the United States has withdrawn its consent, as
provided in paragraph 2 above, or (b) 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 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.
7. Defendants represent that the divestiture ordered in the
proposed Final Judgment can and will be made, and that the defendants
will later raise no claim of hardship or difficulty as grounds for
asking the Court to modify any of the divestiture provisions contained
therein.
Dated: May 25, 1999.
For Plaintiff United States
Frederick H. Parmenter,
U.S. Department of Justice, Antitrust Division, Litigation II Section,
Suite 3000, Washington, D.C. 20530, Telephone: (202) 307-0620,
Facsimile: (202) 307-6283.
For Defendant Florida Rock Industries, Inc.
Eugene J. Meigher,
Arent Fox,
1050 Connecticut Avenue, N.W., Washington, D.C. 20036-5339, Telephone:
(202) 857-6048, Facsimile: (202) 857-6395.
Lewis S. Lee,
LeBoeuf, Lamb, Greene & MacRae, 50 N. Laura Street, Jacksonville,
Florida 32202-3650, Telephone: (904) 630-5322, Facsimile: (904) 353-
1673.
For Defendants Harper Bros., Inc., Commercial Testing, Inc. and Daniel
R. Harper
Neil Imus,
Vinson & Elkins L.L.P., The Willard Office Building, 1455 Pennsylvania
Avenue, N.W., Washington, D.C. 20004-1008, Telephone: (202) 639-6675,
Facsimile: (202) 639-6604.
Order
Approved for entry and ordered \1\ this 27th day of May, 1999,
at Jacksonville, Florida.
---------------------------------------------------------------------------
\1\ Final Judgment and Proposed Final Judgment mean the same
thing.
---------------------------------------------------------------------------
Harvey E. Schlessinger,
United States District Judge.
United States of America, Plaintiff v. Florida Rock Industries,
Inc.; Harper Bros., Inc.; Commercial Testing, Inc.; and Daniel R.
Harper, Defendants. [Civil No.: 99-516-Civ-J-20A.]
Hold Separate Stipulation and Order
It is hereby stipulated and agreed by and between the undersigned
parties,
[[Page 32259]]
subject to approval and entry by the Court, that:
I. Definitions
As used in this Hold Separate Stipulation and Order:
A. ``Florida Rock'' means defendant Florida Rock Industries, Inc.,
a Florida corporation headquartered in Jacksonville, Florida, and
includes its successors and assigns, and its subsidiaries, divisions,
groups, affiliates, directors, officers, managers, agents, and
employees.
B. ``Harper Bros.'' means defendant Harper Bros., Inc., a Florida
corporation headquartered in Fort Myers, Florida, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
C. ``Testing'' means defendant Commercial Testing, Inc., a Florida
corporation headquartered in Fort Myers, Florida, and including its
successors and assigns, and it subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
D. ``Daniel R. Harper'' means defendant Daniel R. Harper, an
individual who resides in Fort Myers, Florida and is the Chairman of
the Board and majority stockholder of Harper Bros. and the majority
stockholder of Testing.
E. ``Aggregate'' means crushed stone and gravel produced at
quarries, mines, or gravel pits used to manufacture asphalt concrete
and ready mix concrete. ``Stone products'' refer to any products
produced at an aggregate quarry.
F. ``Silica sand'' means sand that is naturally occurring and not
produced at an aggregate quarry (known as ``manufactured sand'').
Silica sand is used to produce specific types of ready mix concrete
used in Florida Department of Transportation highway projects and
commercial construction projects.
G. ``Asphalt concrete'' means a paving material produced by
combining and heating asphalt cement (also referred to in the industry
as ``liquid asphalt'' or asphalt oil'') with aggregate.
H. ``Ready mix concrete'' means a building material used in the
construction of building, highways, bridges, tunnels, and other
projects that is produced by mixing a cementing material (commonly
portland cement) and aggregate with sufficient water to cause the
cement to set and bind. Silica sand is combined with aggregate to
produce specific types of ready mix concrete required for certain
construction projects.
I. ``Southwest Florida'' means Charlotte, Lee, and Collier Counties
and Sarasota County south of State Route 780 in Florida. The city of
Sarasota, Florida is located in Sarasota County, and the city of Fort
Myers, Florida is located in Lee County.
J. ``Alico Road Quarry'' means Florida Rock's Alico Road, Lee
County, Florida quarry located at 11840 Alico Road, Fort Myers, Florida
that produces aggregate and stone products, encompassing the north and
south operations, inclusive of:
1. All rights, titles, and interest, including all leasehold and
renewal rights, in the Alico Road Quarry, and related maintenance
facilities and administration buildings including, but not limited to,
all real property and aggregate and stone products reserves, capital
equipment, fixtures, inventories, trucks and other vehicles, licenses,
stone crushing equipment, power supply equipment, scales, interests,
permits, assets or improvements related to the production,
distribution, and sale of aggregate and stone products at the Alico
Road Quarry; and
(2) All intangible assets, including aggregate and stone products
reserve testing information, technical information, leases, know-how,
safety procedures, quality assurance and control procedures, customer
lists and credit records, contracts to supply third parties aggregate
and stone products, associated with the Alico Road Quarry.
K. ``Palmdale Sand Mine'' means Harper Bros.' Palmdale, Glades
County, Florida sand mine located at 5200 U.S. 27, Northwest, Palmdale,
Florida that produces silica sand, inclusive of:
(1) All rights, titles, and interests, including all leasehold and
renewal rights, in the Palmdale Sand Mine, and related maintenance
facilities and administration buildings including, but not limited to,
all real property and silica sand reserves, capital equipment,
fixtures, inventories, trucks and other vehicles, licenses, sand
washing equipment, power supply equipment, scales, interests, permits,
assets or improvements related to the production, distribution, and
sale of silica sand at the Alico Road Quarry; and
(2) All intangible assets, including silica and sand reserve
testing information, technical information, know-how, leases, safety
procedures, quality assurance and control procedures, customer lists
and credit records, and contracts to supply third parties silica sand
associated with the Palmdale Sand Mine.
II. Objectives
The Proposed Judgment filed in this case is meant to ensure Florida
Rock's prompt divestitures of the Alico Road Quarry and the Palmadale
Sand Mine for the purpose of maintaining viable competitors in the sale
of aggregate and silica sand in Southwest Florida to remedy the effects
that the United States alleges would otherwise result from Florida
Rock's proposed acquisition of Harper Bros. This Hold Separate
Stipulation and Order ensures, prior to such divestiture, that the
Alico Road Quarry and the Palmdale Sand Mine that are being divested be
maintained as an independent, economically viable, ongoing business
concern, and that competition is maintained during the pendency of the
diverstitute.
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 Middle District of Florida.
IV. Hold Separate Provisions
Until the divestiture required by the Final Judgment has been
accomplished:
A. Florida Rock shall preserve, maintain, and operate the Alico
Road Quarry and the Palmdale Sand Mine assets as an independent
competitor with management, sales and operations held entirely
separate, distinct and apart from those of Florida Rock. Florida Rock
shall not coordinate its production, marketing or sale of silica sand
and aggregate or stone products with that produced by the Alico Road
Quarry and the Palmdale Sand Mine assets. Within thirty (30) days of
the entering of this Order, Florida Rock will inform the United States
of the steps taken to comply with this provision.
B. Florida Rock shall take all steps necessary to ensure that: (1)
The Alico Road Quarry and Palmdale Sand Mine assets will be maintained
and operated as an independent, ongoing, economically viable and active
competitor in the production and sale of silica sand and aggregate and
stone products in Southwest Florida; (2) management of the Alico Road
Quarry and the Palmdale Sand Mine assets will not be influenced by
Florida Rock; and (3) the books, records, competitively sensitive
sales, marketing and pricing information, and decision-making
associated with the Alico Road Quarry and the Palmdale Sand Mine assets
will be kept separate and apart from the aggregate and stone products
business of Florida Rock. Florida Rock's influence over the Alico Road
Quarry and the Palmdale Sand Mine assets shall be limited to that
necessary to carry out Florida Rock's obligations under this
[[Page 32260]]
Hold Separate Stipulation and Order and the Final Judgment.
C. Florida Rock shall use all reasonable efforts to maintain and
increase sales of silica sand and aggregate and stone products by the
Alico Road Quarry and the Palmdale Sand Mine assets, and shall maintain
at 1998 or previously approved levels, whichever are higher,
promotional, advertising, sales, technical assistance, marketing and
merchandising support for silica sand and aggregate and stone products
produced or sold by the Alico Road Quarry and the Palmdale Sand Mine
assets.
D. Florida Rock shall provide sufficient working capital to
maintain the Alico Road Quarry and the Palmdale Sand Mine assets as
economically viable, competitive, and ongoing businesses.
E. Florida Rock shall take all steps necessary to ensure that the
Alico Road Quarry and the Palmdale Sand Mine assets are fully
maintained in operable condition at no lower than their current rated
capacity configurations, and shall maintain and adhere to normal repair
and maintenance schedules for the Alico Road Quarry and the Palmdale
Sand Mine assets.
F. Florida Rock shall not, except as part of a divestiture approved
by the United States in accordance with the terms of the proposed Final
Judgment, remove, sell, lease, assign, transfer, pledge or otherwise
dispose of any of the Alico Road Quarry and Palmdale Sand Mine assets.
G. Florida Rock shall maintain, in accordance with sound accounting
principles, separate, accurate and complete financial ledgers, books
and records that report on a periodic basis, such as every four weeks
or every month, consistent with past practices, the assets,
liabilities, expenses, revenues and income of the Alico Road Quarry and
Palmdale Sand Mine assets.
H. Except in the ordinary course of business or as is otherwise
consistent with this Hold Separate Stipulation and Order, defendants
shall not hire, transfer or terminate, or alter any current employment
or salary agreements for any Florida Rock or Harper Bros. employees who
(i) on the date of the signing of this Agreement, work at the Alico
Road Quarry and Palmdale Sand Mine or (ii) are members of the
management committee referenced in Section IV(I) of this Order.
I. Until such time as the Alico Road Quarry and the Palmdale Sand
Mine assets are divested, the assets shall be managed by Fred Buckner.
Mr. Buckner shall have complete managerial responsibility for the Alico
Road Quarry and the Palmdale Sand Mine, subject to the provisions of
this Order and the Final Judgment. In the event that Mr. Buckner is
unable to perform his duties, Florida Rock shall appoint, subject to
the United States' approval, a replacement within ten (10) working
days. Should Florida Rock fail to appoint a replacement acceptable to
the United States within ten (10) working days, the United States shall
appoint a replacement.
J. Florida Rock shall take no action that would interfere with the
ability of any trustee appointed pursuant to the Final Judgment to
complete the divestiture pursuant to the Final Judgment to a suitable
purchaser.
K. This Hold Separate Stipulation and Order shall remain in effect
until consummation of the divestiture contemplated by the Final
Judgment or until further Order of the Court.
Dated: May 25, 1999.
For Plaintiff United States:
Frederick H. Parmenter,
U.S. Department of Justice, Antitrust Division, Litigation II Section,
Suite 3000, Washington, D.C. 20530, Telephone: (202) 307-0620,
Facsimile: (202) 307-6283.
For Defendant Florida Rock Industries, Inc.
Eugene J. Meigher, Arent Fox,
1050 Connecticut Avenue, N.W., Washington, D.C. 20036-5339, Telephone:
(202) 857-6048, Facsimile: (202) 857-6395.
Lewis S. Lee,
LeBoeuf, Lamb, Greene & MacRae, 50 N. Laura Street, Jacksonville,
Florida 32202-3650, Telephone: (904) 630-5322, Facsimile: (904) 353-
1673.
For Defendants Harper Bros., Inc., Commercial Testing, Inc. and Daniel
R. Harper
Neil Imus,
Vinson & Elkins L.L.P., The Willard Office Building, 1455 Pennsylvania
Avenue, N.W., Washington, D.C. 20004-1008, Telephone: (202) 639-6675,
Facsimile: (202) 639-6604.
Order
Approved for entry and ordered \1\ this 27th day of May, 1999, at
Jacksonville, Florda.
---------------------------------------------------------------------------
\1\ Proposed final Judgment and Final Judgment referred to
herein are exchangeable.
---------------------------------------------------------------------------
Harvey E. Schlessinger,
United States District Judge.
United States of America, Plaintiff, v. Florida Rock Industries,
Inc., Harper Bros., Inc., Commercial Testing, Inc., and Daniel R.
Harper, Defendants. Civil No.: 99-516-CIV-J-2CA.
Proposed Final Judgment
Whereas, plaintiff, the United States of America, and defendants.
Florida Rock Industries, Inc. (``Florida Rock''), Harper Bros., Inc.
(``Harper Bros.''), Commercial Testing, Inc. (``Testing''), and Daniel
R. Harper, 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 the United States in its Complaint filed on May 26,
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 prompt and
certain divestiture of the identified assets to assure that competition
is not substantially lessened;
And whereas, the United States requires defendants to make certain
divestitures for the purpose of establishing a viable competitor in the
production and sale of aggregate and silica sand in Charlotte, Lee, and
Collier Counties and Sarasota County south of State Route 480 in
Florida;
And whereas, defendants have represented to the United States that
the divestitures ordered herein can and will be made and that
defendants 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 currently believes 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 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. ``Florida Rock'' means defendant Florida Rock Industries, Inc.,
a Florida corporation headquartered in Jacksonville, Florida, and
includes its successors and assigns, and its subsidiaries, divisions,
groups, affiliates, directors, officers, managers, agents, and
employees.
[[Page 32261]]
B. ``Harper Bros.'' means defendant Harper Bros., Inc., a Florida
corporation headquartered in Fort Myers, Florida, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
C. ``Testing'' means defendant Commercial Testing, Inc., a Florida
corporation headquartered in Fort Myers, Florida, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
D. ``Daniel R. Harper'' means defendant Daniel R. Harper, an
individual who resides in Fort Myers, Florida, and is the Chairman of
the Board and majority stockholder of Harper Bros. and the majority
stockholder of Testing.
E. ``Aggregate'' means crushed stone and gravel produced at
quarries, mines, or gravel pits used to manufacture asphalt concrete
and ready mix concrete. ``Stone products'' refer to any products
produced at an aggregate quarry.
F. ``Silica sand'' means sand that is naturally occurring and not
produced at an aggregate quarry (Known as ``manufactured sand'').
Silica sand is used to produce specific types of ready mix concrete
used in Florida Department of Transportation highway projects and
commercial construction projects.
G. ``Asphalt concrete'' means a paving material produced by
combining and heating asphalt cement (also referred to in the industry
as ``liquid asphalt'' or ``asphalt oil'') with aggregate.
H. ``Ready mix concrete'' means a building material used in the
construction of buildings, highways, bridges, tunnels, and other
projects that is produced by mixing a cementing material (commonly
portland cement) and aggregate with sufficient water to cause the
cement to set and bind. Silica sand is combined with aggregate to
produce specific types of ready mix concrete required for certain
construction projects.
I. ``Southwest Florida'' means Charlotte, Lee, and Collier Counties
and Sarasota County south of State Route 780 in Florida. The City of
Sarasota, Florida is located in Sarasota County, and the City of Fort
Myers, Florida is located in Lee County.
J. ``Alico Road Quarry'' means Florida Rock's Alico Road, Lee
County, Florida quarry located at 11840 Alico Road, Fort Myers, Florida
that produces aggregate and stone products, encompassing the north and
south operations, inclusive of:
(1) All rights, titles, and interests, including all leasehold and
renewal rights, in the Alico Road Quarry, and related maintenance
facilities and administration buildings including, but not limited to,
all real property and aggregate and stone products reserves, capital
equipment, fixtures, inventories, trucks and other vehicles, licenses,
stone crushing equipment, power supply equipment, scales, interests,
permits, assets or improvements related to the production,
distribution, and sale of aggregate and stone products at the Alico
Road Quarry; and
(2) All intangible assets, including aggregate and stone products
reserve testing information, technical information, leases, know-how,
safety procedures, quality assurance and control procedures, customer
lists and credit reports, contracts to supply third parties aggregate
and stone products, associated with the Alico Road Quarry.
K. ``Palmdale Sand Mine'' means Harper Bros.' Palmdale, Glades
County, Florida sand mine located at 5200 U.S. 27, Northwest, Palmdale,
Florida that produces silica sand inclusive of:
(1) All rights, titles, and interests, including all leasehold and
renewal rights, in the Palmdale Sand Mine, and related maintenance
facilities and administration buildings including, but not limited to,
all real property and silica sand reserves, capital equipment,
fixtures, inventories, trucks and other vehicles, licenses, sand
washing equipment, power supply equipment, scales, interests, permits,
assets or improvements related to the production, distribution, and
sale of silica sand at the Palmdale Sand Mine; and
(2) All intangible assets, including silica sand reserve testing
information, technical information, leases, know-how, safety
procedures, quality assurance and control procedures, customer lists
and credit reports, contracts to supply third parties silica sand
associated with the Palmdale Sand Mine.
L. ``Reserve Assets'' means the aggregate reserves leased by
Florida Rock located in Lee County Florida, identified as Florida Rock
Properties, Inc's properties in the following locations in Lee County,
Florida:
(1) West Mining Parcel: The east \1/2\ of Section 33 and the south
1500 feet of the southeast \1/4\ of Section 28, Township 45 South,
Range 26 East, Lee County, Florida (see Area 1 of attached map);
(2) North Mining Parcel: The south 1500 feet of Section 27,
Township 45 South, Range 26 East and the northwest \1/4\ of Section 34,
Township 45 South, Range 26 East, Lee County, Florida (see Area 2 of
attached map); and
(3) an easement through the north 956,405 feet of Section 4,
Township 46 South, Range 26 East, Lee County, Florida.
III. Applicability
A. The provisions of this Final Judgment apply to the defendnats,
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. Defendants shall require, as a condition of the sale or other
disposition of the Alcio Road Quarry and the Palmdale Sand Mine, that
the purchaser or purchasers agree to be bound by the provisions of this
Final Judgment.
IV. Divestitures
A. Florida Rock is hereby ordered and directed in accordance with
the terms of this Final Judgment, within one hundred and eighty (180)
calendar days after the filing of the proposed Final Judgment, or five
(5) days after notice of the entry of the Final Judgment by the Court,
whichever is later, to divest the Alico Road Quarry and the Palmdale
Sand Mine to a purchaser or purchasers acceptable to the United States,
in its sole discretion.
B. Florida Rock shall use its best efforts to accomplish the
divestiture as expeditiously and timely as possible.
C. In accomplishing the divestitures ordered by this Final
Judgment, Florida Rock promptly shall make known, by usual and
customary means, the availability of the Alico Road Quarry and the
Palmdale Sand Mine. Florida Rock shall inform any person 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. Florida Rock shall also offer to furnish to all prospective
purchasers, subject to customary confidentiality assurances, all
information regarding these assets customarily provided in a due
diligence process except such information subject to attorney-client
privilege or attorney work-product privilege. Florida Rock shall make
available such information to the United States at the same time that
such information is made available to any other person.
D. Florida Rock shall not interfere with any negotiations by any
purchaser to employ any Florida Rock or Harper Bros. employee who works
at, or whose principal responsibility concerns any
[[Page 32262]]
silica sand or aggregate and stone products business that is part of
the Palmdale Sand Mine or the Alico Road Quarry assets.
E. As customarily provided as part of a due diligence process,
Florida Rock shall permit prospective purchasers of the Alico Road
Quarry and the Palmdale Sand Mine to have access to personnel and to
make such inspection of these 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. Florida Rock shall warrant to the purchaser or purchasers of the
Alico Road Quarry and the Palmdale Sand Mine that each asset will be
operational on the date of sale.
G. Florida Rock shall not take any action, direct or indirect, that
will impede in any way the operation of the Alico Road Quarry or the
Palmdale Sand Mine.
H. Florida Rock shall warrant to the purchaser or purchasers of the
Alico Road Quarry and the Palmdale Sand Mine that there are no known
material defects in the environmental, zoning, or other permits
pertaining to the operation of these assets, and that Florida Rock with
respect to the Alico Road Quarry and the Palmdale Sand Mine will not
undertake, directly or indirectly, following the divestiture of these
assets, any challenges to the environmental, zoning, or other permits
pertaining to the operation of the assets.
I. Unless the United States otherwise consents in writing, the
divestiture pursuant to Section IV, whether by Florida Rock or by
trustee appointed pursuant to Section V of this Final Judgment, shall
include the Alico Road Quarry and the Palmdale Sand Mine and be
accomplished by selling or otherwise conveying each asset, or such
other assets included by the Trustee under Section V, to a purchaser or
purchasers in such a way as to satisfy the United States, in its sole
discretion, that the assets can and will be used by the purchaser or
purchasers as part of a viable, ongoing business or businesses engaged
in the manufacture and sale of aggregate and stone products and silica
sand. The divestitures, 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' sole satisfaction that
the purchaser: (1) Has the capability and intent of competing
effectively in the production and sale of aggregate and stone products
and silica sand in Southwest Florida; (2) has or soon will have the
managerial, operational, and financial capability to compete
effectively in the production and sale of aggregate and stone products
and silica sand in Southwest Florida; and (3) is not hindered by the
terms of any agreement between the purchaser and Florida Rock which
gives Florida Rock the ability unreasonably to raise the purchaser's
cost, lower the purchaser's efficiency, or otherwise to interfere in
the ability of the purchaser to effectively compete in Southwest
Florida.
V. Appointment of Trustee
A. In the event that Florida Rock has not divested the Alico Road
Quarry or the Palmdale Sand Mine within the time specified in Section
IV.A of this Final Judgment, the Court shall appoint, on application of
the United States, a trustee selected by the United States and approved
by the Court to effect the divestiture of each such asset not sold. If
the Alico Road Quarry has not been sold, the trustee shall have the
right, in its sole discretion, to include the Reserve Assets in the
sale of the Alico Road Quarry.
B. After the appointment of a trustee becomes effective, only the
trustee shall have the right to divest any assets. The trustee shall
have the power and authority to accomplish any and all divestitures of
assets 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 Sections V(C) and VIII of this Final
Judgment, the trustee shall have the power and authority to hire at the
cost and expense of Florida Rock any investment bankers, attorneys, or
other 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 acceptable to the United States, and shall have such
other powers as this Court shall deem appropriate. Florida Rock shall
not object to a sale by the trustee on any grounds other than the
trustee's malfeasance. Any such objections by Florida Rock must be
conveyed in writing to the United States 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 Florida Rock,
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 Florida Rock 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 assets to be divested and based on a fee
arrangement providing the trustee with an incentive based on the price
and terms of price and terms of the divestiture and the speed with
which it is accomplished.
D. Florida Rock shall use its best efforts to assist the trustee in
accomplishing the required divestiture, including best effort 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 Florida Rock 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 confidential assurances.
Florida Rock shall permit prospective acquirers of the assets 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 divestiture 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 divestiture 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, expresses an interest in acquiring,
entered into negotiations to acquire, or was contacted or made an
inquiry about acquiring, any interest in any of the businesses 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 assets to be divested.
[[Page 32263]]
F. 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, why 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 consistant 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.
G. The conduct or actions shall be subject to review by the Court
upon the application of any party here to.
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. Florida Rock or
the trustee, whichever is then responsible for effecting the
divestiture, shall notify the United States of the proposed
divestiture. If the trustee is responsible, it shall similarly notify
the United States of the proposed divestiture. If the trustee is
responsible, it shall similarly notify Florida Rock. The notice shall
set forth the details of the proposed transaction and list the name,
address, and telephone number of each person not previously identified
who offered to, or expressed an interest in or a desire to, acquire any
ownership interest in the businesses to be divested that are the
subject of the binding contract, together with full details of same.
Within fifteen (15) calendar days of receipt by the United States of
such notice, the United States, in its sole discretion, may request
from Florida Rock, the proposed purchaser, or any other third party
additional information concerning the proposed divestiture and the
proposed purchaser. Florida Rock 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 (2) calendar days after the United States has been provided the
additional information requested from Florida Rock, the proposed
purchaser, and any third party, whichever is later, the United States
shall provide written notice to Florida Rock 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 Florida Rock and the
trustee that it does not object, then the divestiture may be
consummated, subject only to Florida Rock'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
may not be consummated. Upon objection by Florida Rock 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 this Final
Judgment and every thirty (30) calendar days thereafter until the
divestitures have been completed whether pursuant to Section IV or
Section V of this Final Judgment, Florida Rock shall deliver to the
United States an affidavit as to the fact and manner of compliance with
sections IV or 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, any interest in any of the assets to be
divested, and shall describe in detail each contact with any such
person during that period. Each such affidavit shall also include a
description of the efforts that Florida Rock has taken to solicit a
buyer for any of the assets to be divested and to provide required
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 United States to
information provided by Florida Rock, including limitations on
information, shall be made within (14) days of receipt of such
affidavit.
B. Within twenty (20) calendar days of the filing of this Final
Judgment, Florida Rock shall deliver to the United States an affidavit
which describes in detail all actions Florida Rock has taken and all
steps Florida Rock has implemented on an on-going basis to preserve the
Alico Road Quarry and the Palmdale Sand Mine 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, Florida Rock's efforts to maintain and operate the Alico
Road Quarry and the Palmdale Sand Mine as active competitors, maintain
the management, sales, marketing and pricing of each asset, and
maintain each asset in operable condition at current capacity
configurations. Florida Rock shall deliver to the United States an
affidavit describing any changes to the efforts and actions outlined in
Florida Rock'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,
Florida Rock shall preserve all records of all efforts made to preserve
the Alico Road Quarry and the Palmdale Sand Mine and to effect the
ordered divestitures.
VIII. Hold Separate Order
Until the divestitures required by the Final Judgment have been
accomplished, defendants 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 divestiture
of the Alico Road Quarry and the Palmdale Sand Mine.
IX. Financing
Florida Rock is ordered and directed not to finance all or any part
of any purchase by an acquirer made pursuant to Sections IV or V of
this Final Judgment.
X. Compliance Inspection
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 United States Department
of Justice, upon written request of the Attorney General or of the
Assistant Attorney General in charge of the Antitrust Division, and on
reasonable notice to Florida Rock made to its principal offices, shall
be permitted:
(1) Access during office hours of Florida Rock to inspect and copy
all books, ledgers, accounts, correspondence, memoranda, and other
records and documents in the possession or under the control of Florida
Rock, who may have counsel present, relating to the matters contained
in this Final Judgment and the Hold Separate Stipulation and Order; and
[[Page 32264]]
(2) Subject to the reasonable convenience of Florida Rock and
without restraint or interference from it, to interview, either
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, made to
Florida Rock's principal offices, Florida Rock 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
Section VII or X of this Final Judgment shall be divulged by a
representative of the United States to any person other than a duly
authorized representative of the Executive Branch of the United States,
except in the course of legal proceedings to which the United States is
a party (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 Florida
Rock to the United States. Florida Rock 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 Florida Rock 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 the United States to Florida Rock prior to
divulging such material in any legal proceeding (other than a grand
jury proceeding) to which Florida Rock is not a party.
XI. 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.
XII. Termination
Unless this Court grants an extension, this Final Judgment will
expire on the tenth anniversary of the date of its entry.
XIII. Public Interest
Entry of this Final Judgment is in the public interest.
Done and ordered this ______ day of ____________, 1999,
Jacksonville, Florida.
----------------------------------------------------------------------
United States District Judge.
United States of America, Plaintiff, v. Florida Rock Industries,
Inc.; Harper Bros., Inc.; Commercial Testing, Inc.; and Daniel R.
Harper, Defendants. [Civil No. 99-516-CIV-J-20A].
Proposed Final Judgment
Whereas, plaintiff, the United States of America, and defendants,
Florida Rock Industries, Inc. (``Florida Rock''), Harper Bros., Inc.
(``Harper Bros.''), Commercial Testing, Inc. (``Testing''), and Daniel
R. Harper, 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 the United States in its Complaint filed on May 26,
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 prompt and
certain divestiture of the identified assets to assure that competition
is not substantially lessened;
And whereas, the United States requires defendants to make certain
divestitures for the purpose of establishing a viable competitor in the
production and sale of aggregate and silica sand in Charlotte, Lee, and
Collier Counties and Sarasota County south of State Route 480 in
Florida;
And whereas, defendants have represented to the United States that
the divestitures ordered herein can and will be made and that
defendants 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 currently believes 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 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. ``Florida Rock'' means defendant Florida Rock Industries, Inc.,
a Florida corporation headquartered in Jacksonville, Florida, and
includes its successors and assigns, and its subsidiaries, divisions,
groups, affiliates, directors, officers, managers, agents, and
employees.
B. ``Harper Bros.'' means defendant Harper Bros., Inc., a Florida
corporation headquartered in Fort Myers, Florida, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
C. ``Testing'' means defendant Commercial Testing, Inc., a Florida
corporation headquartered in Fort Myers, Florida, and includes its
successors and assigns, and its subsidiaries, divisions, groups,
affiliates, directors, officers, managers, agents, and employees.
D. ``Daniel R. Harper'' means defendant Daniel R. Harper, an
individual who resides in Fort Myers, Florida, and is the Chairman of
the Board and majority stockholder of Harper Bros. and the majority
stockholder of Testing.
E. ``Aggregate'' means crushed stone and gravel produced at
quarries, mines, or gravel pits used to manufacture asphalt concrete
and ready mix concrete. ``Stone products'' refer to any products
produced at an aggregate quarry.
F. ``Silica sand'' means sand that is naturally occurring and not
produced at an aggregate quarry (known as ``manufactured sand'').
Silica sand is used to produce specific types of ready mix concrete
used in Florida Department of Transportation highway projects and
commercial construction projects.
G. ``Asphalt concrete'' means a paving material produced by
combining and heating asphalt cement (also referred to in the industry
as ``liquid asphalt'' or ``asphalt oil'') with aggregate.
H. ``Ready mix concrete'' means a building material used in the
construction of buildings, highways, bridges, tunnels, and other
projects that is produced by mixing a cementing
[[Page 32265]]
material (commonly portland cement) and aggregate with sufficient water
to cause the cement to set and bind. Silica sand is combine with
aggregate to produced specific types of ready mix concrete required for
certain construction projects.
I. ``Southwest Florida'' means Charlotte, Lee, and Collier Counties
and Sarasota County south of State Route 780 in Florida. The City of
Sarasota, Florida is located in Sarasota County, and the City of Fort
Myers, Florida is located in Lee County.
J. ``Alico Road Quarry'' means Florida Rock's Alico Road, Lee
County, Florida quarry located at 11840 Alico Road, Fort Myers, Florida
that produces aggregate and stone products, encompassing the north and
south operations, inclusive of:
(1) All rights, titles, and interests, including all leasehold and
renewal rights, in the Alico Road Quarry, and related maintenance
facilities and administration buildings including, but not limited to,
all real property and aggregate and stone products reserves, capital
equipment, fixtures, inventories, trucks and other vehicles, licenses,
stone crushing equipment, power supply equipment, scales, interests,
permits, assets or improvements related to the production,
distribution, and sale of aggregate and stone products at the Alico
Road Quarry; and
(2) All intangible assets, including aggregate and stone products
reserve testing information, technical information, leases, know-how,
safety procedures, quality assurance and control procedures, customer
lists and credit reports, contracts to supply third parties aggregate
and stone products, associated with the Alico Road Quarry.
K. ``Palmdale Sand Mine'' means Harper Bros. Palmdale, Glades
County, Florida sand mine located at 5200 U.S. 27, Northwest, Palmdale,
Florida that produces silica sand inclusive of:
(1) All rights, titles, and interests, including all leasehold and
renewal rights, in the Palmdale San Mine, and related maintenance
facilities and administration buildings, including, but not limited to,
all real property and silica sand reserves, capital equipment,
fixtures, inventories, trucks and other vehicles, licenses, and sand
washing equipment, power supply equipment, scales, interests, permits
assets or improvements related to the production, distribution, and
sale of silica sand at the Palmdale Sand Mine; and
(2) All intangible assets, including silica sand reserve testing
information, technical information, leases, know-how, safety
procedures, quality assurance and control procedures, customer lists
and credit reports, contracts to supply third parties silica sand
associated with the Palmdale Sand Mine.
L. ``Reserve Assets'' means the aggregate reserves leased by
Florida Rock located in Lee County, Florida, identified as Florida Rock
Properties, Inc.'s properties in the following locations in Lee County,
Florida:
(1) West Mining Parcel: The east \1/2\ of Section 33 and the south
1500 feet of the southeast \1/4\ of Section 28, Township 45 South,
Range 26 East, Lee County, Florida (see Area 1 of attached map);
(2) North Mining Parcel: The south 1500 feet of Section 27,
Township 45 South, Range 26 East and the northwest \1/4\ of Section 34,
Township 45 South, Range 26 East, Lee County, Florida (see Area 2 of
attached map); and
(3) An easement through the north 959.405 feet of Section 4,
Township 46 South, Range 26 East, Lee County, Florida.
III. Applicability
A. The provision of this Final Judgment apply to the defendants,
their successors and assigns, subsidiaries, directors, officers,
managers, agents, and employeers, 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. Defendants shall require, as a condition of the sale or other
disposition of the Alico Road Quarry and the Palmdale Sand Mine, that
the purchaser or purchasers agree to be bound by the provisions of this
Final Judgment.
IV. Divestitures
A. Florida Rock is hereby ordered and directed in accordance with
the terms of this Final Judgment, within one hundred and eighty (180)
calendar days after the filing of the proposed Final Judgment, or five
(5) days after notice of the entry of this Final Judgment by the Court,
whichever is later, to divest the Alico Road Quarry and the Palmdale
Sand Mine to a purchaser or purchasers acceptable to the United States,
in its sole discretion.
B. Florida Rock shall use its best efforts to accomplish the
divestiture as expeditiously and timely as possible.
C. In accomplishing the divestitures ordered by this Final
Judgment, Florida Rock promptly shall make known, by usual and
customary means, the availability of the Alico Road Quarry and the
Palmdale Sand Mine. Florida Rock 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. Florida Rock shall also offer to furnish to all
prospective purchasers, subject to customary confidentiality
assurances, all information regarding these assets customarily provided
in a due diligence process except such information subject to attorney-
client privilege or attorney work-product privilege. Florida Rock shall
make available such information to the United States at the same time
that such information is made available to any other person.
D. Florida Rock shall not interfere with any negotiations by any
purchaser to employ any Florida Rock or Harper Bros. employee who works
at, or whose principal responsibility concerns any silica sand or
aggregate and stone products business that is part of the Palmdale Sand
Mine or the Alico Road Quarry assets.
E. As customarily provided as part of a due diligence process,
Florida Rock shall permit prospective purchasers of the Alico Road
Quarry and the Palmdale Sand Mine to have access to personnel and to
make such inspection of these 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. Florida Rock shall warrant to the purchaser or purchasers of the
Alico Road Quarry and the Palmdale Sand Mine that each asset will be
operational on the date of sale.
G. Florida Rock shall not take any action, direct or indirect, that
will impede in any way the operation of the Alico Road Quarry or the
Palmdale Sand Mine.
H. Florida Rock shall warrant to the purchaser or purchasers of the
Alico Road Quarry and the Palmdale Sand Mine that there are no known
material defects in the environmental, zoning, or other permits
pertaining to the operation of these assets, and that Florida Rock with
respect to the Alico Road Quarry and the Palmdale Sand Mine will not
undertake, directly or indirectly, following the divestiture of these
assets, any challenges to the environmental, zoning, or other permits
pertaining to the operation of the assets.
1. Unless the United States otherwise consents in writing, the
divestiture pursuant to Section IV, whether by Florida Rock or by
trustees appointed pursuant to Section V of this Final Judgment, shall
include the Alico Road Quarry and the Palmdale Sand Mine and be
accomplished by selling or otherwise conveying each assets, or such
other assets included by the
[[Page 32266]]
Trustee under Section V, to a purchaser or purchasers in such a way as
to satisfy the United States, in its sole discretion, that the assets
can and will be used by the purchaser or purchasers as part of a
viable, ongoing business or businesses engaged in the manufacturer and
sale of aggregate and stone products and silica sand. The divestitures,
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' sole satisfaction that the purchasers: (1) Has
the capability and intent of competing effectively in the production
and sale of aggregate and stone products and silica sand in Southwest
Florida; (2) has or soon will have the managerial, operational, and
financial capability to compete effectively in the production and sale
of aggregate and stone products and silica sand in Southwest Florida;
and (3) is not hindered by the terms of any agreement between the
purchaser and Florida Rock which gives Florida Rock the ability
unreasonably to raise the purchaser's costs, lower the purchaser's
efficiency, or otherwise to interfere in the ability of the purchaser
to effectively compete in Southwest Florida.
V. Appointment of Trustee
A. In the event that Florida Rock has not divested the Alico Road
Quarry or the Palmdale Sand Mine within the time specified in Section
IV. A of this Final Judgment, the Court shall appoint, on application
of the United States, a trustee selected by the United States and
approved by the Court to effect the divestiture of each such asset not
sold. If the Alico Road Quarry has not been sold, the trustee shall
have the right, in its sole discretion, to include the Reserve Assets
in the sale of the Alico Road Quarry.
B. After the appointment of a trustee becomes effective, only the
trustee shall have the right to divest any assets. The trustee shall
have the power and authority to accomplish any and all divestitures of
assets 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 Sections V(C) and VIII of this Final
Judgment, the trustee shall have the power and authority to hire at the
cost and expense of Florida Rock any investment bankers, attorneys, or
other grants reasonably necessary in the judgment of the trustee to
assist in the divestitures, and such professionals and agents shall be
accountably solely to the trustee. The trustee shall have the power and
authority to accomplish the divestitures 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. Florida Rock shall
not object to a sale by the trustee on any grounds other than the
trustee's malfeasance. Any such objections by Florida Rock must be
conveyed in writing to the United States 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 Florida Rock,
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 Florida Rock 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 assets to be divested 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. Florida Rock shall use its best efforts to assist the trustee in
accomplishing the required divestiture, including best effort 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 Florida Rock 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 confidential assurances.
Florida Rock shall permit prospective acquirers of the assets 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 divestiture 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 divestiture ordered under this Final Judgment; provided,
however, that to the extent shall 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, expresses an interest in acquiring,
entered into negotiations to acquire, or was contacted or made an
inquiry about acquiring, any interest in any of the businesses 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 assets to be divested.
F. 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, why 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 United States, or
G. The conduct on actions of the trustee shall be subject to review
by the Court upon the application of any party here to.
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, Florida Rock or
the trustee, whichever is then responsible for effecting the
divestiture, shall notify the United States of the proposed
divestiture. If the trustee is responsible, it shall similarly notify
Florida Rock. The notice shall set forth the details of the proposed
transaction and list the name, address, and telephone number of each
person not previously identified who offered to, or expressed an
interest in or a desire to,
[[Page 32267]]
acquire any ownership interest in the businesses to be divested that
are the subject of the binding contract, together with full details of
same. Within fifteen (15) calendar days of receipt by the United States
of such notice, the United States, in its sole discretion, may request
from Florida Rock, the proposed purchaser, or any other third party
additional information concerning the proposed divestiture and the
proposed purchaser. Florida Rock 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 the United States has been provided the
additional information requested from Florida Rock, the proposed
purchaser, and any third party, whichever is later, the United States
shall provide written notice to Florida Rock 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 Florida Rock and the
trustee that it does not object, then the divestiture may be
consummated, subject only to Florida Rock'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
may not be consummated. Upon objection by Florida Rock 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 this Final
Judgment and every thirty (30) calendar days thereafter until the
divestitures have been completed whether pursuant to Section IV or
Section V of this Final Judgment, Florida Rock shall deliver to the
United States an affidavit as to the fact and manner of compliance with
Sections IV or 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, any interest in any of the assets to be
divested, and shall describe in detail each contact with any such
person during that period. Each such affidavit shall also include a
description of the efforts that Florida Rock has taken to solicit a
buyer for any of the assets to be divested and to provide required
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 United States to
information provided by Florida Rock, including limitations on
information, shall be made within (14) days of receipt of such
affidavit.
B. Within twenty (20) calendar days of the filing of this Final
Judgment, Florida Rock shall deliver to the United States an affidavit
which describes in detail all actions Florida Rock has taken and all
steps Florida Rock has implemented on an on-going basis to preserve the
Alico Road Quarry and the Palmdale Sand Mine 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, Florida Rock's effort to maintain and operate the Alico
Road Quarry and the Palmdale Sand Mine as active competitors, maintain
the management, sales, marketing and pricing of each asset, and
maintain each asset in operable condition at current capacity
configurations. Florida Rock shall deliver to the United States an
affidavit describing any changes to the efforts and actions outlined in
Florida Rock'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,
Florida Rock shall preserve all records of all efforts made to preserve
the Alico Road Quarry and the Palmdale Sand Mine and to effect the
ordered divestitures.
VIII. Hold Separate Order
Until the divestitures required by the Final Judgment have been
accomplished, defendants 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 divestiture
of the Alico Road Quarry and the Palmdale Sand Mine.
IX. Financing
Florida Rock is ordered and directed not to finance all or any part
of any purchase by an acquirer made pursuant to Sections IV or V of
this Final Judgment.
X. Compliance Inspection
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 United States Department
of Justice, upon written request of the Attorney General or of the
Assistant Attorney General in charge of the Antitrust Division, and on
reasonable notice to Florida Rock made to its principal offices, shall
be permitted:
(1) Access during office hours of Florida Rock to inspect and copy
all books, ledgers, accounts, correspondence, memoranda, and other
records and documents in the possession or under the control of Florida
Rock, 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 Florida Rock and
without restraint or interference from it, to interview, either
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, made to
Florida Rock's principal offices, Florida Rock 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
Section VII or X of this Final Judgment shall be divulged by a
representative of the United States to any person other than a duly
authorized representative of the Executive Branch of the United States,
except in the course of legal proceedings to which the United States is
a party (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 Florida
Rock to the United States, Florida Rock 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 Florida Rock 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 the United States to Florida Rock prior to
divulging such material in any legal proceeding (other than a grand
jury proceeding) to which Florida Rock is not a party.
[[Page 32268]]
XI. 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.
XII. Termination
Unless this Court grants an extension, this Final Judgment will
expire on the tenth anniversary of the date of its entry.
XIII. Public Interest
Entry of this Final Judgment is in the public interest.
DONE and ORDERED this ______ day of ____________ 1999,
Jacksonville, Florida.
----------------------------------------------------------------------
United States District Judge.
A copy of the tract map can be obtained from the U.S. Department of
Justice, Antitrust Division, 202-514-2481.
United States of America, Plaintiff, v. Florida Rock Industries,
Inc.; Harper Bros., Inc.; Commercial Testing, Inc.; and Daniel R.
Harper, Defendants. [Civil No.: 99-516-CIV-J-20A; Filed: 5/26/99.]
Competitive Impact Statement
The United States, pursuant to section 2(b) of the Antitrust
Procedures and Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files
this Competitive Impact Statement relating to the proposed Final
Judgment submitted for entry in this civil antitrust proceeding.
I. Nature and Purpose of The Proceeding
The United States filed a civil antitrust Compliant under section
15 of the Clayton Act, 15 U.S.C. 25, on May 26, 1999, alleging that the
proposed acquisition by Florida Rock Industries, Inc. (``Florida
Rock'') of Harper Bros., Inc. (``Harper Bros.'') and Commercial
Testing, Inc. (``Testing'') pursuant to a letter of intent entered into
on May 5, 1999, would violate Section 7 of the Clayton Act, 15 U.S.C.
18.
The Complaint alleges that a combination of two of only three
significant competitors in the aggregate and silica sand markets in
Charlotte, Lee, and Collier Counties and Sarasota County south of State
Route 780 in Florida (``Southwest Florida'') would lessen competition
in the production and sale of aggregate and silica sand in Southwest
Florida. The prayer for relief in the Complaint seeks: (1) A judgment
that the proposed acquisition would violate Section 7 of the Clayton
Act; (2) a permanent injunction preventing Florida Rock from acquiring
control of Harper Bros., Testing, and 320 acres of land, or otherwise
combining with the businesses of Harper Bros. and Testing; (3) the
United States be awarded costs; and (4) other relief as the Court deems
just and proper.
When the Complaint was filed, the United States also filed a
proposed settlement that would permit Florida Rock to complete its
acquisition of Harper Bros., Testing, and 320 acres of land, but
require a certain divestiture that will preserve in the Southwest
Florida aggregate and silica sand markets. This settlement consists of
a Stipulation and Order, a proposed Final Judgment and a Hold Separate
Stipulation and Order.
The proposed Final Judgment orders Florida Rock to divest the
Florida Rock Alico Road Quarry located in Lee County, Florida, the
Harper Bros. Palmdale Sand Mine located in Glades County, Florida, and
certain related tangible and intangible assets associated with the
facilities. Florida Rock must complete the divestiture of this quarry
and related assets within one hundred and eighty (180) calendar days
after the date on which the proposed Final Judgment was filed (i.e.,
May 26, 1999) or within 5 days after notice of the entry of the Final
Judgment by the Court, whichever is later, in accordance with the
procedure specified therein. If Florida Rock does 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 the
assets. If a trustee must undertake to divest the Alico Road Quarry,
the trustee has the option of adding certain Florida Rock aggregate
reserve parcels that are contiguous to the Alico Road Quarry to the
divestiture package.
The Stipulation and Order, proposed Final Judgment and Hold
Separate Stipulation and Order require Florida Rock to ensure that the
Alico Road Quarry, the Palmdale Sand Mine, and related assets to be
divested will be maintained and operated as an independent, ongoing,
economically viable and active competitor until the divestitures
mandated by the proposed Final Judgment have been accomplished. Final
Rock must preserve and maintain the quarry and sand mine to be divested
as saleable and economically viable, ongoing concerns, with
competitively sensitive business information and decision-making
divorced from that of Florida Rock's other aggregate and silica sand
businesses. Florida Rock will appoint a person to monitor and ensure
its compliance with these requirements of the proposed Final Judgment.
The United States and defendants have stipulated that the proposed
Final Judgment may be entered after compliance with the APPA. Entry of
the proposed Final Judgment would terminate 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
A. Florida Rock, Harper Bros., Testing, and the Proposed Transaction
Florida Rock is a Florida corporation with headquarters in
Jacksonville, Florida. Florida Rock operates in Florida, Georgia,
Virginia, Maryland, Washington, DC, and North Carolina. One of its
principal businesses is extracting and selling aggregate and silica
sand. Florida Rock is engaged in the business of selling aggregate and
silica sand in Southwest Florida. In Lee County, Florida Rock operates
the Alico Road Quarry that produces aggregate, and in Glades County, it
operates the Witherspoon Sand Mine which produces silica sand. In 1997,
Florida Rock had sales of approximately $456 million.
Harper Bros. is a Florida corporation with headquarters in Fort
Myers, Florida. One of Harper Bros.' principal business is extracting
and processing aggregates and silica sand. Harper Bros. is engaged in
the business of selling aggregate and silica sand in Southwest Florida.
In Lee County, Harper Bros. operates the Alico Road Mine that produces
aggregate, and in Glades County, it operates the Palmdale Sand Mine
which produces silica sand. In 1997, Harper Bros. had sales of
approximately $44 million.
On July 21, 1998, through a letter of intent that was supplemented
on August 26, 1998, Florida Rock agreed to acquire all of the
outstanding capital stock of Harper Bros., Testing and 320 acres of
land. The letter of intent lapsed on January 2, 1999, and a subsequent
letter of intent was entered into by the defendants on May 5, 1999. The
purchase price is approximately $87.5 million. This transaction, which
would take place in the highly concentrated Southwest Florida aggregate
and silica sand industries, precipitated the government's suit.
[[Page 32269]]
B. The Transaction's Effects in Southwest Florida
The Complaint alleges that, the production and sale of aggregate
and silica sand constitute two distinct lines of commerce, or relevant
product markets, for antitrust purposes, and that Southwest Florida
constitutes a section of the country, or relevant geographic market.
The complaint alleges that the effect of Florida Rock's acquisition may
be to lessen competition substantially in the production and sale of
aggregate and silica sand in Southwest Florida.
Aggregate is a stone product used to manufacture asphalt concrete
and ready mix concrete. Aggregate differs from all other types of stone
products in its physical composition, functional characteristics,
customary uses, and pricing. It must meet Florida Department of
Transportation or American Society of Testing Material's specifications
for the specific type of asphalt concrete or ready mix concrete being
produced. Manufacturers of asphalt concrete and ready mix concrete in
Southwest Florida do not view other types of stone products as good
substitutes. The production and sale of aggregate used to manufacture
asphalt concrete and ready mix concrete constitutes a line of commerce
and a relevant market for antitrust purposes.
Silica sand differs from sand that is manufactured from stone
products (manufactured sand is the alternative to silica sand) in its
physical composition, functional characteristics, and customary uses.
The Florida Department of Transportation requires silica sand to be
used in ready mix concrete whenever the ready mix concrete is used as a
surface for vehicular traffic. Commercial contractors use silica sand
in place of, or in combination with, manufactured sand to manufacture
ready mix concrete when superior pumping or finishing qualities are
required. Manufacturers of ready mix concrete recognizes silica sand as
a distinct product. The production and sale of silica sand used to
manufacture specific types of ready mix concrete constitutes a line of
commerce and a relevant market for antitrust purposes.
Producers of aggregate and/or silica sand located in or near
Southwest Florida sell and compete with each other for sales of
aggregate and silica sand in Southwest Florida. Due to high
transportation costs and long delivery time, producers of aggregate
and/or silica sand not located in or near Southwest Florida do not sell
a significant amount of aggregate and/or silica sand for use within
Southwest Florida.
The Complaint alleges that Florida Rock's acquisition of Harper
Bros. would substantially lessen competition for the production and
sale of aggregate and silica sand in Southwest Florida. Actual and
potential competition between Florida Rock and Harper Bros. for the
production and sale of aggregate and silica sand in Southwest Florida
will be eliminated. Florida Rock and Harper Bros. are the largest
producers of aggregate in Southwest Florida and have the largest
reserves of aggregate in Southwest Florida. Florida Rock accounts for
about 44 percent of the aggregate produced in Southwest Florida and
Harper Bros. accounts for approximately 24 percent. After the
acquisition, the combined entity will control about 68 percent of the
Southwest Florida aggregate market. They are two of only three
significant producers in Southwest Florida possessing sufficient
aggregate reserves that would permit consumers to switch aggregate
suppliers if prices increased.
For silica sand, Florida Rock and Harper Bros. are two of only
three producers capable of selling silica sand in Southwest Florida.
After the acquisition, the combined entity will control approximately
60 percent of the Southwest Florida silica sand market.
The acquisition of Harper Bros. by Florida Rock would create a
dominant aggregate and silica sand company in Southwest Florida. In the
aggregate market, it would reduce from three to two the number of
significant competitors which possess sufficient aggregate reserves
that would permit consumers to switch aggregate suppliers if prices
were increased. In the silica sand market, the number of competitors
would decline from three to two. Florida Rock would have the market
power to increase prices for aggregate and silica sand. In addition,
the proposed acquisition will facilitate coordinated pricing activity
among aggregate and silica sand producers and increase the likelihood
of anticompetitive price increases for consumers. Aggregate and silica
sand products are only slightly differentiated (if at all), and price
is an important dimension of competition. The combination of Florida
Rock's and Harper Bros.' Southwest Florida aggregate and silica sand
businesses would result in a substantial reduction in competition,
increase the risk of coordinated action, and likely result in higher
aggregate and silica sand prices.
New entry in Southwest Florida is unlikely to restore the
competition lost through Florida Rock's removal of Harper Bros. from
the aggregate and silica sand markets. Establishing a new, successful
aggregate or silica sand production facility in or near Southwest
Florida is difficult, time-consuming and costly. To be cost competitive
in Southwest Florida, an aggregate or silica sand production facility
must be able to produce large amounts of consistent quality aggregate
or silica sand in close proximity to asphalt concrete and/or ready mix
concrete plants. Environmental and zoning permits must be obtained to
operate an aggregate or silica sand production facility. Federal, state
and local environmental provisions and state and local zoning
provisions make it very difficult to open an aggregate or silica sand
production facility in or near Southwest Florida. Timely and sufficient
entry is unlikely to occur in the aggregate or silica sand markets in
Southwest Florida to defeat any post-acquisition price increases.
C. Harm to Competition as a Consequence of the Acquisition
The Complaint alleges that the transaction would have the following
effects, among others: Competition for the production and sale of
aggregate and silica sand in Southwest Florida will be substantially
lessened; actual and potential competition between Florida Rock and
Harper Bros. in the production and sale of aggregate and silica sand in
Southwest Florida will be eliminated; and prices for aggregate and
silica sand in Southwest Florida are likely to increase above
competitive levels.
III. Explanation of the Proposed Final Judgment
The proposed Final Judgment would preserve competition in the
production and sale of aggregate and silica sand in Southwest Florida
by placing in independent hands Florida Rock's Alico Rod Quarry which
serves the Southwest Florida aggregate market and Harper Bros.'
Palmdale Sand Mine which serves the Southwest Florida silica sand
market. This would maintain the existing number of suppliers in the two
markets. In response to a price increase from Florida Rock, purchasers
would be able to turn to other producers of aggregate and silica sand
with significant capacity to serve Southwest Florida.
Within one hundred and eighty (180) calendar days after filing the
proposed Final Judgment of five (5) days after the entry of the Final
Judgment, whichever is later, Florida Rock must divest its Alico Road
aggregate quarry, Harper Bros.' Palmdale Sand Mine, and related assets.
The Alico Road Quarry and the Palmdale Sand Mine will be sold to a
purchaser or purchasers that demonstrates to the sole satisfaction of
[[Page 32270]]
the United States that they will be an economically viable and
effective competitors, capable of competing effectively in the
production and sale of aggregate and/or silica sand in Southwest
Florida.
Until the ordered divestiture take place, Florida Rock must take
all reasonable steps necessary to accomplish the divestiture and
cooperate with any prospective puchaser. If Florida Rock does not
accomplish the ordered divestiture within the specified one hundred and
eighty (180) calendar days, which may be extended by up to sixty (60)
calendar days by the United States in its sole discretion, the proposed
Final Judgment provides for procedures by which the Court shall appoint
a trusteee to complete the divestiture. If a trustee must undertake to
divest the Alico Road Quarry, the trustee has the option of adding
certain Florida Rock aggregate reserve parcels that are contiguous to
the Alico Road Quarry to the divestiture package. Florida Rock must
cooperate fully with the trustee.
If a trustee is appointed, the proposed Final Judgment provides
that Florida Rock will pay all costs and expenses of the trustee. The
trustee's compensation will be structured so as to provide an incentive
for the trustee to obtain the highest price then available for the
assets to be divested, and to accomplish the divestiture as quickly as
possible. After the effective date of his or her appointment, the
trustee shall serve under such other conditions as the Court may
prescribe. 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 the divestiture. At the end of six
(6) months, if the mandated divestiture has not been accomplished, the
trustee shall file promptly with the Court a report that sets forth the
trustee's efforts to accomplish the divestiture, explain why the
divestiture has not been accomplished, and make any recommendations.
The trustee's report will be furnished to the parties and shall be
filed in the public docket, except to the extent the report contains
information the trustee deems confidential. The parties each will have
the right to make additional recommendations to the Court. The Court
shall enter such orders as it deems appropriate to carry out the
purpose of the trust.
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
attorney's fees. Entry of the proposed Final Judgment neither will
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 Florida Rock,
Harber Bros., Testing, or Daniel Harper.
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 a period of at least sixty (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 should comment within sixty (60)
days of the date of publication of this Competitive Impact Statement in
the Federal Register. The United States will evaluate and respond to
the comments. All comments will be given due consideration by the
Department of Justice, which remains free to withdraw its contest 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, a full trial on the merits of its Complaint against the
defendants. The United States is satisfied, however, that the
divestiture of the assets and other relief contained in the proposed
Final Judgment will preserve viable competition in the production and
sale of aggregate and silica sand in Southwest Florida that otherwise
would be affected adversely by the acquisition. Thus, the proposed
Final Judgment would achieve the relief the government would have
obtained through litigation, but avoids the time, expense and
uncertainty of a full trial on the merits of the government's
Complaint.
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 prposed Final Judgment ``is in the public interest.'' In making
that determination, the court may consider--
(1) The competitive impact of such judgment, including
termination of alleged violations, provisions for enforcement and
modification, duration or relief sought, anticipated effects of
alternative remedies actually considered, and any other
considerations bearing upon the adequacy of such judgment;
(2) The impact of entry of such judgment upon the public
generally and individuals alleging specific injury from the
violations set forth in the complaint including consideration of the
public benefit, if any, to be derived from a determination of the
issues at trial.
15 U.S.C. 16(e) (emphasis added). As the 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 (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
[[Page 32271]]
(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 trail 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. 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., 1997-1 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 State 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:
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 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 Cynamid 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.'' \3\
---------------------------------------------------------------------------
\3\ 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. Aluminum, Ltd., 605 F. Supp.
619, 622 (W.D. Ky 1985).
---------------------------------------------------------------------------
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.
Executed on: May 25, 1999.
Respectfully submitted,
Frederick H. Parmenter,
Attorney, United States Department of Justice, Antitrust Division,
Litigation II Section, Suite 3000, 1401 H Street, NW, Washington, DC
20530, Telephone: (202) 307-0620, Facsimile: (202) 307-6283.
[FR Doc. 99-14895 Filed 6-15-99; 8:45 am]
BILLING CODE 4410-11-M
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.