9946 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

3The 2004 amendments substituted the word 

‘‘shall’’ for ‘‘may’’ when directing the courts to 

consider the enumerated factors and amended the 

list of factors to focus on competitive considerations 

and address potentially ambiguous judgment terms. 

Compare 15 U.S.C. 16(e) (2004), with 15 U.S.C. 

16(e)(1) (2006); see also SBC Commc’ns, 489 F. 

Supp. 2d at 11 (concluding that the 2004 

amendments ‘‘effected minimal changes’’ to Tunney 

Act review). 

4See United States v. Enova Corp., 107 F. Supp. 

2d 10, 17 (D.D.C. 2000) (noting that the ‘‘Tunney 

Act expressly allows the court to make its public 

interest determination on the basis of the 

competitive impact statement and response to 

comments alone’’); United States v. Mid-Am. 

Dairymen, Inc., 1977–1 Trade Cas. (CCH) ¶ 61,508, 

at 71,980 (W.D. Mo. 1977) (‘‘Absent a showing of 

corrupt failure of the government to discharge its 

duty, the Court, in making its public interest 

finding, should * * * carefully consider the 

explanations of the government in the competitive 

impact statement and its responses to comments in 

order to determine whether those explanations are 

reasonable under the circumstances.’’); S. Rep. No. 

93–298, 93d Cong., 1st Sess., at 6 (1973) (‘‘Where 

the public interest can be meaningfully evaluated 

simply on the basis of briefs and oral arguments, 

that is the approach that should be utilized.’’). 

Dist. LEXIS 84787, at *20 (‘‘the ‘public 

interest’ is not to be measured by 

comparing the violations alleged in the 

complaint against those the court 

believes could have, or even should 

have, been alleged’’). Because the 

‘‘court’s authority to review the decree 

depends entirely on the government’s 

exercising its prosecutorial discretion by 

bringing a case in the first place,’’ it 

follows that ‘‘the court is only 

authorized to review the decree itself,’’ 

and not to ‘‘effectively redraft the 

complaint’’ to inquire into other matters 

that the United States did not pursue. 

Microsoft, 56 F.3d at 1459–60. As this 

Court confirmed in SBC 

Communications, courts ‘‘cannot look 

beyond the complaint in making the 

public interest determination unless the 

complaint is drafted so narrowly as to 

make a mockery of judicial power.’’ 489 

F. Supp. 2d at 15. 

In its 2004 amendments to the 

Tunney Act,3 Congress made clear its 

intent to preserve the practical benefits 

of utilizing consent decrees in antitrust 

enforcement, stating: ‘‘[n]othing in this 

section shall be construed to require the 

court to conduct an evidentiary hearing 

or to require the court to permit anyone 

to intervene.’’ 15 U.S.C. 16(e)(2). The 

language wrote into the statute what 

Congress intended when it enacted the 

Tunney Act in 1974, as Senator Tunney 

explained: ‘‘[t]he court is nowhere 

compelled to go to trial or to engage in 

extended proceedings which might have 

the effect of vitiating the benefits of 

prompt and less costly settlement 

through the consent decree process.’’ 

119 Cong. Rec. 24,598 (1973) (statement 

of Senator Tunney). Rather, the 

procedure for the public interest 

determination is left to the discretion of 

the court, with the recognition that the 

court’s ‘‘scope of review remains sharply 

proscribed by precedent and the nature 

of Tunney Act proceedings.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 11.4

VIII. Determinative Documents 

There are no determinative materials 

or documents within the meaning of the 

APPA that were considered by the 

United States in formulating the 

proposed Final Judgment. 

Dated: February 24, 2010. 

Respectfully submitted. 

Rachel J. Adcox, 

U.S. Department of Justice, Antitrust 

Division, Litigation II Section, 450 Fifth 

Street, NW., Suite 8700, Washington, DC 

20530, (202) 305–2738. 

Certificate of Service 

I, Rachel J. Adcox, hereby certify that 

on February 24, 2010, I caused a copy 

of the foregoing Competitive Impact 

Statement to be served upon defendants 

Bemis Company, Inc., Rio Tinto plc, and 

Alcan Corporation by mailing the 

documents electronically to the duly 

authorized legal representatives of 

defendants as follows: 

Counsel for Defendant Bemis Company, 

Inc.: 

Stephen M. Axinn, Esq., John D. 

Harkrider, Esq., Axinn, Veltrop & 

Harkrider LLP, 114 West 47th 

Street, New York, NY 10036, (212) 

728–2200, sma@avhlaw.com, 

jdh@avhlaw.com. 

Counsel for Defendants Rio Tinto plc 

and Alcan Corporation: 

Steven L. Holley, Esq., Bradley P. 

Smith, Esq., Sullivan & Cromwell 

LLP, 125 Broad Street, New York, 

NY 10004, (212) 558–4737, 

holleys@sullcrom.com, 

smithbr@sullcrom.com. 

Rachel J. Adcox, Esq., 

United States Department of Justice, 

Antitrust Division, Litigation II Section, 450 

Fifth Street, NW., Suite 8700, Washington, 

DC 20530, (202) 616–3302. 

[FR Doc. 2010–4550 Filed 3–3–10; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF JUSTICE 

Antitrust Division 

United States v. Keyspan Corporation; 

Proposed Final Judgment and 

Competitive Impact Statement 

Notice is hereby given pursuant to the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. 16(b)–(h), that a proposed 

Final Judgment, Stipulation and 

Competitive Impact Statement have 

been filed with the United States 

District Court for the Southern District 

of New York in United States of 

America v. KeySpan Corp., Civil Case 

No. 10–CIV–1415. On February 22, 

2010, the United States filed a 

Complaint alleging that KeySpan 

Corporation (‘‘KeySpan’’) entered into an 

agreement with a financial services 

company, the likely effect of which was 

to increase prices in the New York City 

(NYISO Zone J) Capacity Market, in 

violation of Section 1 of the Sherman 

Act, 15 U.S.C. 1. The proposed Final 

Judgment, filed the same time as the 

Complaint, requires KeySpan to pay the 

government $12 million dollars. 

Copies of the Complaint, proposed 

Final Judgment and Competitive Impact 

Statement are available for inspection at 

the Department of Justice, Antitrust 

Division, Antitrust Documents Group, 

450 Fifth Street, NW., Suite 1010, 

Washington, DC 20530 (telephone: 202– 

514–2481), on the Department of 

Justice’s Web site at http:// 

www.justice.gov/atr, and at the Office of 

the Clerk of the United States District 

Court for the Southern District of New 

York. Copies of these materials may be 

obtained from the Antitrust Division 

upon request and payment of the 

copying fee set by Department of Justice 

regulations. 

Public comment is invited within 60 

days of the date of this notice. Such 

comments, and responses thereto, will 

be published in the Federal Register 

and filed with the Court. Comments 

should be directed to Donna N. 

Kooperstein, Chief, Transportation, 

Energy, and Agriculture Section, 

Antitrust Division, U.S. Department of 

Justice, 450 Fifth Street, NW., Suite 

8000, Washington, DC 20530 

(telephone: 202–307–6349). 

Patricia A. Brink, 

Deputy Director of Operations and Civil 

Enforcement. 

United States District Court for the 

Southern District of New York 

Civil Action No.: 10–cv–1415 (WHP) 

ECF CASE 

United States of America, U.S. Department 

of Justice, Antitrust Division, 450 5th Street, 

NW., Suite 8000, Washington, DC 20530, 

Plaintiff, v. Keyspan Corporation, 1 

Metrotech Center, Brooklyn, NY 11201, 

Defendant. 

Received: February 22, 2010 

Complaint 

The United States of America, acting 

under the direction of the Attorney 

General of the United States, brings this 

civil antitrust action under Section 4 of 

the Sherman Act, as amended, 15 U.S.C. 

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Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 9947 

4, to obtain equitable and other relief 

from defendant’s violation of Section 1 

of the Sherman Act, as amended, 15 

U.S.C. 1. 

On January 18, 2006, KeySpan 

Corporation (‘‘KeySpan’’) and a financial 

services company executed an 

agreement (the ‘‘Keyspan Swap’’) that 

ensured that KeySpan would withhold 

substantial output from the New York 

City electricity generating capacity 

market, a market that was created to 

ensure the supply of sufficient 

generation capacity for New York City 

consumers of electricity. The likely 

effect of the Keyspan Swap was to 

increase capacity prices for the retail 

electricity suppliers who must purchase 

capacity, and, in turn, to increase the 

prices consumers pay for electricity. 

I. Introduction 

1. Between 2003 and 2006, KeySpan, 

the largest seller of electricity generating 

capacity (‘‘installed capacity’’) in the 

New York City market, earned 

substantial revenues due to tight supply 

conditions. Because purchasers of 

capacity required almost all of 

KeySpan’s output to meet expected 

demand, KeySpan’s ability to set price 

levels was limited only by a regulatory 

ceiling (called a ‘‘bid cap’’). Indeed, the 

market price for capacity was 

consistently at or near KeySpan’s bid 

cap, with KeySpan sacrificing sales on 

only a small fraction of its capacity. 

2. But market conditions were about 

to change. Two large, new electricity 

generation plants were slated to come 

on line in 2006 (with no exit expected 

until at least 2009), breaking the 

capacity shortage that had kept prices at 

the capped levels. 

3. KeySpan could prevent the new 

capacity from lowering prices by 

withholding a substantial amount of its 

own capacity from the market. This ‘‘bid 

the cap’’ strategy would keep market 

prices high, but at a significant cost— 

the sacrificed sales would reduce 

KeySpan’s revenues by as much as $90 

million a year. Alternatively, KeySpan 

could compete with its rivals for sales 

by bidding more capacity at lower 

prices. This ‘‘competitive strategy’’ could 

earn KeySpan more than bidding its 

cap, but it carried a risk—KeySpan’s 

competitors could undercut its price 

and take sales away, making the strategy 

less profitable than ‘‘bidding the cap.’’ 

4. KeySpan searched for a way to 

avoid both the revenue decline from 

bidding its cap and the revenue risks of 

competitive bidding. It decided to enter 

an agreement that gave it a financial 

interest in the capacity of Astoria— 

KeySpan’s largest competitor. By 

providing KeySpan revenues on a larger 

base of sales, such an agreement would 

make a ‘‘bid the cap’’ strategy more 

profitable than a successful competitive 

bid strategy. Rather than directly 

approach its competitor, KeySpan 

turned to a financial services company 

to act as the counterparty to the 

agreement—the KeySpan Swap— 

recognizing that the financial services 

company would, and in fact did, enter 

an offsetting agreement with Astoria 

(the ‘‘Astoria Hedge’’). 

5. With KeySpan deriving revenues 

from both its own and Astoria’s 

capacity, the KeySpan Swap removed 

any incentive for KeySpan to bid 

competitively, locking it into bidding its 

cap. Capacity prices remained as high as 

if no entry had occurred. 

II. Defendant 

6. KeySpan Corporation is a New 

York corporation with its principal 

place of business in New York City. 

During the relevant period of the 

allegations in this Complaint, KeySpan 

owned approximately 2,400 megawatts 

of electricity generating capacity at its 

Ravenswood electrical generation 

facility, which is located in New York 

City. KeySpan had revenues of 

approximately $850 million in 2006 and 

$700 million in 2007 from the sale of 

energy and capacity at its Ravenswood 

facility. 

III. Jurisdiction and Venue 

7. The United States files this 

complaint under Section 4 of the 

Sherman Act, 15 U.S.C. 4, seeking 

equitable relief from defendant’s 

violation of Section 1 of the Sherman 

Act, 15 U.S.C. 1. 

8. This court has jurisdiction over this 

matter pursuant to 15 U.S.C. 4 and 28 

U.S.C. 1331 and 1337. 

9. Defendant waives any objection to 

venue and personal jurisdiction in this 

judicial district for the purpose of this 

Complaint. 

10. Defendant engaged in interstate 

commerce during the relevant period of 

the allegations in this Complaint; 

KeySpan’s electric generating units 

interconnected with generating units 

across the country, and KeySpan 

regularly sold electricity to customers 

outside New York. 

11. One generation facility located in 

New Jersey supplies capacity to the New 

York City installed capacity market. 

IV. The New York City Installed 

Capacity Market 

12. Sellers of retail electricity must 

purchase a product from generators 

known as ‘‘installed capacity.’’ Installed 

capacity is a product created by the New 

York Independent System Operator 

(‘‘NYISO’’) to ensure that sufficient 

generation capacity exists to meet 

expected electricity needs. Companies 

selling electricity to consumers in New 

York City are required to make installed 

capacity payments that relate to their 

expected peak demand plus a share of 

reserve capacity (to cover extra facilities 

needed in case a generating facility 

breaks down). These payments assure 

that retail electric companies do not sell 

more electricity than the system can 

deliver and also encourage electric 

generating companies to build new 

facilities as needed. 

13. The price for installed capacity 

has been set through auctions 

administered by the NYISO. The rules 

under which these auctions are 

conducted have changed from time to 

time. Unless otherwise noted, the 

description of the installed capacity 

market in the following paragraphs 

relates to the period May 2003 through 

March 2008. 

14. Because transmission constraints 

limit the amount of energy that can be 

imported into the New York City area 

from the power grid, the NYISO requires 

retail providers of electricity to 

customers in New York City to purchase 

80% of their capacity from generators in 

that region. The NYISO operates 

separate capacity auctions for the New 

York City region (also known as ‘‘InCity’’ and ‘‘Zone J’’). The NYISO 

organizes the auctions to serve two 

distinct seasonal periods, summer (May 

through October) and winter (November 

through April). For each season, the 

NYISO conducts seasonal, monthly and 

spot auctions in which capacity can be 

acquired for all or some of the seasonal 

period. 

15. In each of the types of auctions, 

capacity suppliers offer price and 

quantity bids. Supplier bids are 

‘‘stacked’’ from lowest-priced to highest, 

and compared to the total amount of 

demand being satisfied in the auction. 

The offering price of the last bid in the 

‘‘stack’’ needed to meet requisite 

demand establishes the market price for 

all capacity bid into that auction. 

Capacity bid at higher than this price is 

unsold, as is any excess capacity bid at 

what becomes the market price. 

16. The New York City Installed 

Capacity (‘‘NYC Capacity’’) Market 

constitutes a relevant geographic and 

product market. 

17. The NYC Capacity Market is 

highly concentrated, with three firms— 

KeySpan, NRG Energy, Inc. (‘‘NRG’’) and 

Astoria Generating Company (a joint 

venture of Madison Dearborn Partners, 

LLC and US Power Generating 

Company, which purchased the Astoria 

generating assets from Reliant Energy, 

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9948 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

Inc. in February 2006)—controlling a 

substantial portion of generating 

capacity in the market. Because 

purchasers of capacity require at least 

some of each of these three suppliers’ 

output to meet expected demand, the 

firms are subject to a bid and price cap 

for nearly all of their generating capacity 

in New York City and are not allowed 

to sell that capacity outside of the 

NYISO auction process. The NYISO-set 

bid cap for KeySpan is the highest of the 

three firms, followed by NRG and 

Astoria. 

18. KeySpan possessed market power 

in the NYC Capacity Market. 

19. It is difficult and time-consuming 

to build or expand generating facilities 

within the NYC Capacity Market given 

limited undeveloped space for building 

or expanding generating facilities and 

extensive regulatory obligations. 

V. Keyspan’s Plan To Avoid 

Competition 

20. From June 2003 through December 

2005, KeySpan set the market price in 

the New York City spot auction by 

bidding its capacity at its cap. Given 

extremely tight supply and demand 

conditions, KeySpan needed to 

withhold only a small amount of 

capacity to ensure that the market 

cleared at its cap. 

21. KeySpan anticipated that the tight 

supply and demand conditions in the 

NYC Capacity Market would change in 

2006, due to the entry of approximately 

1000 MW of new generation. Because of 

the addition of this new capacity, 

KeySpan would have to withhold 

significantly more capacity from the 

market and would earn substantially 

lower revenues if it continued to bid all 

of its capacity at its bid cap. KeySpan 

anticipated that demand growth and 

retirement of old generation units would 

restore tight supply and demand 

conditions in 2009. 

22. KeySpan could no longer be 

confident that ‘‘bidding the cap’’ would 

remain its best strategy during the 2006– 

2009 period. It considered various 

competitive bidding strategies under 

which KeySpan would compete with its 

rivals for sales by bidding more capacity 

at lower prices. These strategies could 

potentially produce much higher 

returns for KeySpan but carried the risk 

that competitors would undercut its 

price and take sales away, making the 

strategy less profitable than ‘‘bidding the 

cap.’’ 

23. KeySpan also considered 

acquiring Astoria’s generating assets, 

which were for sale. This would have 

solved the problem that new entry 

posed for KeySpan’s revenue stream, as 

Astoria’s capacity would have provided 

KeySpan with sufficient additional 

revenues to make continuing to ‘‘bid the 

cap’’ its best strategy. KeySpan 

consulted with a financial services 

company about acquiring the assets. But 

KeySpan soon concluded that its 

acquisition of its largest competitor 

would raise serious market power 

issues. 

24. Instead of purchasing the Astoria 

assets, KeySpan decided to acquire a 

financial interest in substantially all of 

Astoria’s capacity. KeySpan would pay 

Astoria’s owner a fixed revenue stream 

in return for the revenues generated 

from Astoria’s capacity sales in the 

auctions. 

25. KeySpan did not approach Astoria 

directly and instead sought a 

counterparty to enter into a financial 

agreement providing KeySpan with 

payments derived from the market 

clearing price for an amount of capacity 

essentially equivalent to what Astoria 

owned. KeySpan recognized the 

counterparty would need 

simultaneously to enter into an 

agreement with another capacity 

supplier that would offset the 

counterparty’s payments to KeySpan, 

and KeySpan knew that Astoria was the 

only supplier with sufficient capacity to 

do so. KeySpan turned to the same 

financial services company that it had 

consulted about the potential 

acquisition of Astoria’s assets. The 

financial services company agreed to 

serve as the counterparty but, as 

expected, informed KeySpan that the 

agreement was contingent on the 

financial services company also entering 

into an offsetting agreement with the 

owner of the Astoria generating assets. 

VI. The Agreements 

26. On or about January 9, 2006, 

KeySpan and the financial services 

company finalized the terms of the 

KeySpan Swap. Under the agreement, if 

the market price for capacity was above 

$7.57 per kW-month, the financial 

services company would pay KeySpan 

the difference between the market price 

and $7.57 times 1800 MW; if the market 

price was below $7.57, KeySpan would 

pay the financial services company the 

difference times 1800 MW. 

27. The KeySpan Swap was executed 

on January 18, 2006. The term of the 

KeySpan Swap ran from May 2006 

through April 2009. 

28. On or about January 9, 2006, the 

financial services company and Astoria 

finalized the terms of the Astoria Hedge. 

Under that agreement, if the market 

price for capacity was above $7.07 per 

kW-month, Astoria would pay the 

financial services company the 

difference times 1800 MW; if the market 

price was below $7.07, Astoria would be 

paid the difference times 1800 MW. 

29. The Astoria Hedge was executed 

on January 11, 2006. The term of the 

Astoria Hedge ran from May 2006 

through April 2009, matching the 

duration of the KeySpan Swap. 

VII. The Competitive Effect of the 

Keyspan Swap 

30. The clear tendency of the 

KeySpan Swap was to alter KeySpan’s 

bidding in the NYC Capacity Market 

auctions. 

31. Without the Swap, KeySpan likely 

would have chosen from a range of 

potentially profitable competitive 

strategies in response to the entry of 

new capacity. Had it done so, the price 

of capacity would have declined. By 

transferring a financial interest in 

Astoria’s capacity to KeySpan, however, 

the Swap effectively eliminated 

KeySpan’s incentive to compete for 

sales in the same way a purchase of 

Astoria or a direct agreement between 

KeySpan and Astoria would have done. 

By providing KeySpan revenues from 

Astoria’s capacity, in addition to 

Keyspan’s own revenues, the Swap 

made bidding the cap KeySpan’s most 

profitable strategy regardless of its 

rivals’ bids. 

32. After the KeySpan Swap went into 

effect in May 2006, KeySpan 

consistently bid its capacity at its cap 

even though a significant portion of its 

capacity went unsold. Despite the 

addition of significant new generating 

capacity in New York City, the market 

price of capacity did not decline. 

33. In August 2007, the State of New 

York conditioned the sale of KeySpan to 

a new owner on the divestiture of 

KeySpan’s Ravenswood generating 

assets and required KeySpan to bid its 

New York City capacity at zero from 

March 2008 until the divestiture was 

completed. Since March 2008, the 

market price for capacity has declined. 

34. But for the KeySpan Swap, 

installed capacity likely would have 

been procured at a lower price in New 

York City from May 2006 through 

February 2008. 

35. The KeySpan Swap produced no 

countervailing efficiencies. 

VIII. Violation Alleged 

36. Plaintiff incorporates the 

allegations of paragraphs 1 through 35 

above. 

37. KeySpan entered into an 

agreement the likely effect of which has 

been to increase prices in the NYC 

Capacity Market, in violation of Section 

1 of the Sherman Act, 15 U.S.C. 1. 

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Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 9949 

IX. Prayer for Relief 

Wherefore, Plaintiff prays: 

1. That the Court adjudge and decree 

that the KeySpan Swap agreement 

constitutes an illegal restraint in the sale 

of installed capacity in the New York 

City market in violation of Section 1 of 

the Sherman Act; 

2. That plaintiff shall have such other 

relief, including equitable monetary 

relief, as the nature of this case may 

require and as is just and proper to 

prevent the recurrence of the alleged 

violation and to dissipate the 

anticompetitive effects of the violation; 

and 

3. That plaintiff recover the costs of 

this action. 

Dated this 22nd day of February 2010. 

Respectfully Submitted, 

Christine A. Varney, 

Assistant Attorney General. 

Molly S. Boast, 

Deputy Assistant Attorney General. 

William F. Cavanaugh, Jr., 

Deputy Assistant Attorney General. 

Donna N. Kooperstein, 

Chief. 

William H. Stalling, 

Assistant Chief. 

Transportation, Energy & Agriculture Section 

Suite 8000. 

Patricia A. Brink, 

Deputy Director of Operations. 

Jade Alice Eaton, 

J. Richard Doidge, 

John W. Elias, 

Trial Attorneys. 

U.S. Department of Justice, Antitrust 

Division, Transportation, Energy & 

Agriculture Section, 450 5th Street, NW., 

Suite 8000, Washington, DC 20530, 

Telephone: (202) 353–1560, Facismilie (202) 

616–2441, jade.eaton@usdoj.gov. 

United States District Court for the 

Southern District of New York 

ECF Case 

Civil Action No. 10–cv–1415 (WHP) 

United States of America, Plaintiff, v. 

Keyspan Corporation, Defendant. 

Received: February 22, 2010 

Final Judgment 

Whereas plaintiff United States of 

America filed its Complaint alleging 

that Defendant KeySpan Corporation 

(‘‘KeySpan’’) violated Section 1 of the 

Sherman Act, 15 U.S.C. 1, and plaintiff 

and KeySpan, through their respective 

attorneys, having consented to the entry 

of this Final Judgment without trial or 

adjudication of any issue of fact or law, 

for settlement purposes only, and 

without this Final Judgment 

constituting any evidence against or an 

admission by KeySpan with respect to 

any allegation contained in the 

Complaint: 

Now, therefore, before the taking of 

any testimony and without trial or 

adjudication of any issue of fact or law 

herein, and upon the consent of the 

parties hereto, it is hereby ordered, 

adjudged, and decreed: 

1. Jurisdiction 

This Court has jurisdiction of the 

subject matter herein and of each of the 

parties consenting hereto. The 

Complaint states a claim upon which 

relief may be granted against KeySpan 

under Sections 1 and 4 of the Sherman 

Act, 15 U.S.C. 1 and 4. 

2. Applicability 

This Final Judgment applies to 

KeySpan and each of its successors, 

assigns, and to all other persons in 

active concert or participation with it 

who shall have received actual notice of 

the Settlement Agreement and Order by 

personal service or otherwise. 

3. Relief 

A. Within thirty (30) days of the entry 

of this Final Judgment, KeySpan shall 

pay to the United States the sum of 

twelve million dollars ($12,000,000.00). 

B. The payment specified above shall 

be made by wire transfer. Before making 

the transfer, KeySpan shall contact Janie 

Ingalls, of the Antitrust Division’s 

Antitrust Documents Group, at (202) 

514–2481 for wire transfer instructions. 

C. In the event of a default in 

payment, interest at the rate of eighteen 

(18) percent per annum shall accrue 

thereon from the date of default to the 

date of payment. 

4. Retention of Jurisdiction 

This Court retains jurisdiction to 

enable any party to this Final Judgment 

to apply to this Court at any time for 

further orders and directions as may be 

necessary or appropriate to carry out or 

construe this Final Judgment, to modify 

any of its provisions, to enforce 

compliance, and to punish violations of 

its provisions. 

5. Public Interest Determination 

Entry of this Final Judgment is in the 

public interest. The parties have 

complied with the requirements of the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. 16, including making copies 

available to the public of this Final 

Judgment, the Competitive Impact 

Statement, and any comments thereon 

and plaintiff’s responses to comments. 

Based upon the record before the Court, 

which includes the Competitive Impact 

Statement and any comments and 

response to comments filed with the 

Court, entry of this Final Judgment is in 

the public interest. 

Dated: 

United States District Judge. 

United States District Court for the 

Southern District of New York 

ECF Case 

Civil Action No. 10–cv–1415 (WHP) 

United States of America, Plaintiff, v. 

Keyspan Corporation, Defendant. 

Filed 02/23/2010 

Competitive Impact Statement 

Plaintiff United States of America 

(‘‘United States’’), pursuant to Section 

2(b) of the Antitrust Procedures and 

Penalties Act (‘‘APPA’’ or ‘‘Tunney Act’’), 

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 

Proceedings 

The United States brought this 

lawsuit against Defendant KeySpan 

Corporation (‘‘KeySpan’’) on February 

22, 2010, to remedy a violation of 

Section 1 of the Sherman Act, 15 U.S.C. 

1. On January 18, 2006, KeySpan 

entered into an agreement in the form of 

a financial derivative (the ‘‘KeySpan 

Swap’’) essentially transferring to 

KeySpan, the largest supplier of 

electricity generating capacity in the 

New York City market, the capacity of 

its largest competitor. The KeySpan 

Swap ensured that KeySpan would 

withhold substantial output from the 

capacity market, a market that was 

created to ensure the supply of 

sufficient generation capacity for the 

millions of New York City consumers of 

electricity. The likely effect of this 

agreement was to increase capacity 

prices for the retail electricity suppliers 

who must purchase capacity, and, in 

turn, to increase the prices consumers 

pay for electricity. 

The proposed Final Judgment 

remedies this violation by requiring 

KeySpan to disgorge profits obtained 

through the anticompetitive agreement. 

Under the terms of the proposed Final 

Judgment, KeySpan will surrender $12 

million to the Treasury of the United 

States. Disgorgement will deter KeySpan 

and others from future violations of the 

antitrust laws. 

The United States and KeySpan have 

stipulated that the proposed Final 

Judgment may be entered after 

compliance with the APPA, unless the 

United States withdraws its consent. 

Entry of the proposed Final Judgment 

would terminate this action, except that 

this Court would retain jurisdiction to 

construe, modify, and enforce the 

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9950 Federal Register / Vol. 75, No. 42 / Thursday, March 4, 2010 / Notices 

1Except where noted otherwise, this description 

pertains to the market conditions that existed from 

May 2003 through March 2008. 

proposed Final Judgment and to punish 

violations thereof. 

II. Description of the Events Giving Rise 

to the Alleged Violation of the Antitrust 

Laws 

A. The Defendant 

KeySpan Corporation is a New York 

corporation with its principal place of 

business in New York City. During the 

relevant period of the allegations in this 

Complaint, KeySpan owned 

approximately 2400 megawatts of 

electricity generating capacity at its 

Ravenswood electrical generation 

facility, which is located in New York 

City. KeySpan had revenues of 

approximately $850 million in 2006 and 

$700 million in 2007 from the sale of 

energy and capacity at its Ravenswood 

facility. 

B. The Market 

In the state of New York, sellers of 

retail electricity must purchase a 

product from generators known as 

installed capacity (‘‘capacity’’).1

Electricity retailers are required to 

purchase capacity in an amount equal to 

their expected peak energy demand plus 

a share of reserve capacity. These 

payments assure that retail electric 

companies do not use more electricity 

than the system can deliver and 

encourage electric generating companies 

to build new facilities as needed. 

Because transmission constraints limit 

the amount of energy that can be 

imported into the New York City area 

from the power grid, the New York 

Independent System Operator 

(‘‘NYISO’’) requires retail providers of 

electricity to customers in New York 

City to purchase 80% of their capacity 

from generators in that region. Thus, the 

New York City Installed Capacity (‘‘NYC 

Capacity’’) Market constitutes a relevant 

geographic and product market. 

The price for installed capacity has 

been set through auctions administered 

by the NYISO. The NYISO organizes the 

auctions to serve two distinct seasonal 

periods, summer (May though October) 

and winter (November through April). 

For each season, the NYISO conducts 

seasonal, monthly, and spot auctions in 

which capacity can be acquired for all 

or some of the seasonal period. Capacity 

suppliers offer price and quantity bids 

in each of these three auctions. Supplier 

bids are ‘‘stacked’’ from lowest-priced to 

highest. The stack is then compared to 

the amount of demand. The offering 

price of the last bid in the ‘‘stack’’ 

needed to meet requisite demand 

establishes the market price for all 

capacity sold into that auction. Any 

capacity bid at higher than this price is 

unsold, as is any excess capacity bid at 

what becomes the market price. 

The NYC Capacity Market was highly 

concentrated during the relevant period, 

with three firms—Astoria, NRG Energy, 

Inc., and KeySpan—controlling a 

substantial portion of the market’s 

generating capacity. These three were 

designated as pivotal suppliers by the 

Federal Energy Regulatory Commission, 

meaning that at least some of each of 

these three suppliers’ output was 

required to satisfy demand. The three 

firms were subject to bid and price 

caps—KeySpan’s being the highest—for 

nearly all of their generating capacity in 

New York City and were not allowed to 

sell their capacity outside of the NYISO 

auction process. 

C. The Alleged Violation 

1. KeySpan Assesses Plans for Changed 

Market Conditions 

From June 2003 through December 

2005, almost all installed capacity in the 

market was needed to meet demand. 

With these tight market conditions, 

KeySpan could sell almost all of its 

capacity into the market, even while 

bidding at its cap. KeySpan did so, and 

the market cleared at the price 

established by the cap, with only a 

small fraction of KeySpan’s capacity 

remaining unsold. 

KeySpan anticipated that the tight 

supply and demand conditions in the 

NYC Capacity Market would end in 

2006 due to the entry into the market of 

approximately 1000 MW of generation 

capacity, and would not return until 

2009 with the retirement of old 

generation units and demand growth. 

KeySpan could no longer be confident 

that ‘‘bid the cap’’ would remain its best 

strategy during the 2006–2009 period. 

The ‘‘bid the cap’’ strategy would keep 

market prices high, but at a significant 

cost. KeySpan would have to withhold 

a significant additional amount of 

capacity to account for the new entry. 

The additional withholding would 

reduce KeySpan’s revenues by as much 

as $90 million a year. Alternatively, 

KeySpan could compete with its rivals 

for sales by bidding more capacity at 

lower prices. KeySpan considered 

various competitive bidding strategies. 

These could potentially produce much 

higher returns for KeySpan than bidding 

the cap but carried the risk that 

competitors would undercut its price 

and take sales away, making the strategy 

potentially less profitable than bidding 

the cap. 

KeySpan also considered acquiring 

Astoria’s generating assets, which were 

for sale. This would have solved the 

problem that new entry posed for 

KeySpan’s revenue stream, as Astoria’s 

capacity would have provided KeySpan 

with sufficient additional revenues to 

make continuing to bid its cap its best 

strategy. KeySpan consulted with a 

financial services company about 

acquiring the assets, but soon concluded 

that its acquisition of its largest 

competitor would raise market power 

issues. 

2. KeySpan Pursues an Anticompetitive 

and Unlawful Agreement 

Instead of purchasing the Astoria 

assets, KeySpan decided to acquire a 

financial interest in Astoria’s capacity. 

KeySpan would pay Astoria’s owner a 

fixed revenue stream in return for the 

revenues generated from Astoria’s 

capacity sales in the auctions. The 

competitive effect of doing so would be 

similar to that of actually purchasing 

Astoria’s capacity. 

KeySpan did not approach Astoria 

directly and instead sought a 

counterparty to enter into a financial 

agreement providing KeySpan with 

payments derived from the market 

clearing price for an amount of capacity 

essentially equivalent to what Astoria 

owned. KeySpan recognized the 

counterparty would need 

simultaneously to enter into an 

agreement with another capacity 

supplier that would offset the 

counterparty’s payments to Keyspan, 

and KeySpan knew that Astoria was the 

only supplier with sufficient capacity to 

do so. KeySpan turned to the same 

financial services company that it had 

consulted about the potential 

acquisition of Astoria’s assets. The 

financial services company agreed to 

serve as the counterparty, but, as 

expected, informed KeySpan that the 

agreement was contingent on the 

financial services company also entering 

into an offsetting agreement with the 

owner of the Astoria generating assets 

(the ‘‘Astoria Hedge’’). 

On or about January 9, 2006, KeySpan 

and the financial services company 

finalized the terms of the KeySpan 

Swap. Under the agreement, if the 

market price for capacity was above 

$7.57 per kW-month, the financial 

services company would pay KeySpan 

the difference between the market price 

and $7.57 times 1800 MW; if the market 

price was below $7.57, KeySpan would 

pay the financial services company the 

difference times 1800 MW. The 

KeySpan Swap was executed on January 

18, 2006. The term of the KeySpan 

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2The effects of the swap continued until March 

2008, at which time changes in regulatory 

conditions eliminated KeySpan’s ability to affect 

the market price. KeySpan was sold to another 

company in August 2007. The State of New York 

conditioned its approval of the acquisition on the 

divestiture of KeySpan’s Ravenswood generating 

assets and required KeySpan to bid its New York 

City capacity at zero from March 2008 until the 

divestiture was completed. Since then, the market 

price for capacity has declined. 

3The Second Circuit has also permitted 

disgorgement under civil RICO, which confers 

jurisdiction to ‘‘prevent and restrain violations,’’ 18 

U.S.C. 1964(a). See United States v. Carson, 52 F.3d 

1173, 1181 (2d Cir. 1995) (‘‘As a general rule, 

disgorgement is among the equitable powers 

available to the district court by virtue of * * * 

§ 1964’’). The DC Circuit, however, has held that 

disgorgement categorically is unavailable under 

civil RICO. See United States v. Philip Morris, 396 

F.3d 1190, 1192, 1202 (DC Cir. 2005) (interlocutory 

appeal) (Philip Morris I); United States v. Philip 

Morris, 566 F.3d 1095, 1108 (DC Cir. 2009) (appeal 

after final judgment) (Philip Morris II). The Supreme 

Court denied the government’s petition to review 

the interlocutory decision in Philip Morris I, 126 S. 

Ct. 478 (2005), but on February 19, 2010, the United 

States asked the Supreme Court to review Philip 

Morris II. In United States v. Loew’s, Inc., 189 F. 

Supp. 373 (S.D.N.Y. 1960), this Court declined to 

order defendants to renegotiate contracts with third 

parties, or to refund money to third parties under 

those renegotiated contracts. Id. at 398–99 & n.13. 

Swap ran from May 2006 through April 

2009. 

On or about January 9, 2006, the 

financial services company and Astoria 

finalized terms to the Astoria Hedge. 

Under that agreement, if the market 

price for capacity was above $7.07 per 

kW-month, Astoria would pay the 

financial services company the 

difference times 1800 MW; if the market 

price was below $7.07, Astoria would be 

paid the difference times 1800 MW. The 

Astoria Hedge was executed on January 

11, 2006. The term of the Astoria Hedge 

ran from May 2006 through April 2009, 

matching the duration of the KeySpan 

Swap. 

3. The Effect of the KeySpan Swap 

The clear tendency of the KeySpan 

Swap was to alter KeySpan’s bidding in 

the NYC Capacity Market auctions. 

Without the swap, KeySpan likely 

would have chosen from a range of 

potentially profitable competitive 

strategies in response to the entry of 

new capacity and, had it done so, the 

price of capacity would have declined. 

The swap, however, effectively 

eliminated KeySpan’s incentive to 

compete for sales. By adding revenues 

from Astoria’s capacity to KeySpan’s 

own, the KeySpan Swap made bidding 

the cap KeySpan’s most profitable 

strategy regardless of its rivals’ bids. 

After the KeySpan Swap went into 

effect in May 2006, KeySpan 

consistently bid its capacity into the 

capacity auctions at its cap even though 

a significant portion of its capacity went 

unsold. Despite the addition of 

significant new generating capacity in 

New York City, the market price of 

capacity did not decline. 

By transferring a financial interest in 

Astoria’s capacity to KeySpan, the Swap 

effectively eliminated KeySpan’s 

incentive to compete for sales in the 

same way a purchase of Astoria or a 

direct agreement between KeySpan and 

Astoria would have done. But for the 

Swap, installed capacity likely would 

have been procured at a lower price in 

New York City from May 2006 through 

February 2008.2 The Swap produced no 

countervailing efficiencies. 

III. Explanation of the Proposed Final 

Judgment 

The proposed Final Judgment requires 

KeySpan to disgorge profits gained as a 

result of its unlawful agreement 

restraining trade. KeySpan is to 

surrender $12 million to the Treasury of 

the United States. 

A. Disgorgement Is Available Under the 

Sherman Act 

Although the Antitrust Division has 

not previously sought disgorgement as a 

remedy under the Sherman Act, district 

courts have the authority to order such 

equitable relief. The Supreme Court has 

held that ‘‘[u]nless a statute in so many 

words, or by a necessary and 

inescapable inference, restricts the 

court’s jurisdiction in equity, the full 

scope of that jurisdiction is to be 

recognized and applied.’’ Porter v. 

Warner Holding Co., 328 U.S. 395, 398 

(1946); Mitchell v. Robert De Mario 

Jewelry, Inc., 361 U.S. 288, 291 (1960). 

Nothing in the Sherman Act negates this 

inherent authority. Section 4 of the 

Sherman Act invests district courts with 

broad equitable power to ‘‘prevent and 

restrain’’ violations of the antitrust laws 

and provides that such violations may 

be ‘‘enjoined or otherwise prohibited.’’ 

15 U.S.C. 4. See International Boxing 

Club v. United States, 358 U.S. 242, 253 

(1959) (relief should ‘‘deprive ‘the 

antitrust defendants of the benefits of 

their conspiracy,’ ’’ quoting Schine 

Chain Theatres v. United States, 334 

U.S. 110, 128 (1948)); United States v. 

U.S. Steel Corp., 251 U.S. 417, 452 

(1920) (Sherman Act’s ‘‘command is 

necessarily submissive to the conditions 

which may exist and the usual powers 

of a court of equity to adapt its remedies 

to those conditions’’). The Second 

Circuit has held that disgorgement is 

among a district court’s inherent 

equitable powers, and is a ‘‘wellestablished remedy * * * to prevent 

wrongdoers from unjustly enriching 

themselves through violations, which 

has the effect of deterring subsequent 

fraud.’’ SEC v. Cavanagh, 445 F.3d 105, 

116–17 (2d Cir. 2006). See also SEC v. 

Fischbach, 133 F.3d 170, 175 (2d Cir. 

1997); SEC v. Commonwealth Chem. 

Secs., Inc., 574 F.2d 90, 102 (2d Cir. 

1978) (Friendly, J.).3

B. Disgorgement Is Appropriate in This 

Case 

Disgorgement is necessary to protect 

the public interest by depriving 

KeySpan of the fruits of its ill-gotten 

gains and deterring KeySpan and others 

from engaging in similar 

anticompetitive conduct in the future. 

Absent disgorgement, KeySpan would 

be likely to retain all the benefits of its 

anticompetitive conduct. A private 

lawsuit for damages against KeySpan 

would face significant obstacles 

imposed by the filed rate doctrine. See 

Keogh v. Chicago & N.W. Ry. Co., 260 

U.S. 156 (1922). The filed rate doctrine 

also makes it unlikely that disgorgement 

will lead to duplicative monetary 

remedies. 

Furthermore, no other remedy would 

be as effective to fulfill the remedial 

goals of the Sherman Act to ‘‘prevent 

and restrain’’ antitrust violations. 

Injunctive relief would not be 

meaningful, given the facts in this case. 

The specific agreement at issue—the 

KeySpan Swap—has, by its terms, 

expired and the anticompetitive 

conduct is unlikely to reoccur as 

KeySpan no longer owns the 

Ravenswood generation assets. 

Disgorgement here will also serve to 

restrain KeySpan and others from 

participating in similar anticompetitive 

conduct. Requiring KeySpan to disgorge 

a portion of its ill-gotten gains from its 

recent illegal behavior is the only 

effective way of achieving relief against 

KeySpan, while sending a strong 

message to those considering similar 

anticompetitive conduct. 

IV. Remedies Available to Potential 

Private Litigants 

Section 4 of the Clayton Act, 15 

U.S.C. 15, provides that any person who 

has been injured as a result of conduct 

prohibited by the antitrust laws may 

bring suit in federal court to recover 

three times the damages the person has 

suffered, as well as costs and reasonable 

attorneys’ fees. Entry of the proposed 

Final Judgment will neither impair nor 

assist the bringing of any private 

antitrust damage action. Under the 

provisions of Section 5(a) of the Clayton 

Act, 15 U.S.C. 16(a), the proposed Final 

Judgment has no prima facie effect in 

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4The 2004 amendments substituted ‘‘shall’’ for 

‘‘may’’ in directing relevant factors for a court to 

consider and amended the list of factors to focus on 

competitive considerations and to address 

potentially ambiguous judgment terms. Compare 15 

U.S.C. 16(e) (2004), with 15 U.S.C. 16(e)(1) (2006); 

see also SBC Commc’ns, 489 F. Supp. 2d at 11 

(concluding that the 2004 amendments ‘‘effected 

minimal changes’’ to Tunney Act review). 

5Cf. BNS, 858 F.2d at 464 (holding that the 

court’s ‘‘ultimate authority under the [APPA] is 

limited to approving or disapproving the consent 

decree’’); United States v. Gillette Co., 406 F. Supp. 

713, 716 (D. Mass. 1975) (noting that, in this way, 

the court is constrained to ‘‘look at the overall 

picture not hypercritically, nor with a microscope, 

but with an artist’s reducing glass’’). See generally 

Microsoft, 56 F.3d at 1461 (discussing whether ‘‘the 

remedies [obtained in the decree are] so 

inconsonant with the allegations charged as to fall 

outside of the ‘reaches of the public interest’ ’’). 

any subsequent private lawsuit that may 

be brought against KeySpan. 

V. Procedures Available for 

Modification of the Proposed Final 

Judgment 

The United States and the defendant 

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 who wishes to 

comment should do so within sixty (60) 

days of the date of publication of this 

Competitive Impact Statement in the 

Federal Register, or the last date of 

publication in a newspaper of the 

summary of this Competitive Impact 

Statement, whichever is later. All 

comments received during this period 

will be considered by the United States, 

which remains free to withdraw its 

consent to the proposed Final Judgment 

at any time prior to the Court’s entry of 

judgment. 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: Donna N. Kooperstein, 

Chief, Transportation, Energy & 

Agriculture Section, Antitrust Division, 

United States Department of Justice, 450 

Fifth Street, NW., Suite 8000, 

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 

against Defendant. The United States is 

satisfied, however, that the 

disgorgement of profits is an appropriate 

remedy in this matter. A disgorgement 

remedy should deter Keyspan and 

others from engaging in similar conduct. 

Given the facts of this case, the 

proposed Final Judgment would protect 

competition as effectively as would any 

other equitable remedy available 

through litigation, but avoids the time, 

expense, and uncertainty of a full trial 

on the merits of the Complaint. 

VII. Standard of Review Under the 

APPA for Proposed Final Judgment 

The Clayton Act, as amended by the 

APPA, requires that proposed consent 

judgments in antitrust cases brought by 

the United States be subject to a sixtyday comment period, after which the 

court shall determine whether entry of 

the proposed Final Judgment ‘‘is in the 

public interest.’’ 15 U.S.C. 16(e)(1). In 

making that determination, the court, in 

accordance with the statute as amended 

in 2004, is required to consider: 

(A) The competitive impact of such 

judgment, including termination of alleged 

violations, provisions for enforcement and 

modification, duration of relief sought, 

anticipated effects of alternative remedies 

actually considered, whether its terms are 

ambiguous, and any other competitive 

considerations bearing upon the adequacy of 

such judgment that the court deems 

necessary to a determination of whether the 

consent judgment is in the public interest; 

and 

(B) The impact of entry of such judgment 

upon competition in the relevant market or 

markets, 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)(1)(A) & (B). In 

considering these statutory factors, the 

court’s inquiry is necessarily a limited 

one as the United States is entitled to 

‘‘broad discretion to settle with the 

defendant within the reaches of the 

public interest.’’ United States v. 

Microsoft Corp., 56 F.3d 1448, 1461 (DC 

Cir. 1995); see generally United States v. 

SBC Commc’ns, Inc., 489 F. Supp. 2d 1 

(D.D.C. 2007) (assessing public interest 

standard under the Tunney Act); United 

States v. InBev N.V./S.A., 2009–2 Trade 

Cas. (CCH) ¶ 76,736, 2009 U.S. Dist. 

LEXIS 84787, No. 08–1965 (JR), at *3 

(D.D.C. Aug. 11, 2009) (noting that the 

court’s review of a consent judgment is 

limited and only inquires ‘‘into whether 

the government’s determination that the 

proposed remedies will cure the 

antitrust violations alleged in the 

complaint was reasonable, and whether 

the mechanism to enforce the final 

judgment are clear and manageable’’).4

Under the APPA a court considers, 

among other things, the relationship 

between the remedy secured and the 

specific allegations set forth in the 

United States’ complaint, whether the 

decree is sufficiently clear, whether 

enforcement mechanisms are sufficient, 

and whether the decree may positively 

harm third parties. See Microsoft, 56 

F.3d at 1458–62. With respect to the 

adequacy of the relief secured by the 

decree, a court may not ‘‘engage in an 

unrestricted evaluation of what relief 

would best serve the public.’’ United 

States v. BNS, Inc., 858 F.2d 456, 462 

(9th Cir. 1988) (citing United States v. 

Bechtel Corp., 648 F.2d 660, 666 (9th 

Cir. 1981)); see also Microsoft, 56 F.3d 

at 1460–62; United States v. Alcoa, Inc., 

152 F. Supp. 2d 37, 40 (D.D.C. 2001); 

InBev, 2009 U.S. Dist. LEXIS 84787, at 

*3. Courts have held that: 

[t]he 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. 

Bechtel, 648 F.2d at 666 (emphasis 

added) (citations omitted).5 In 

determining whether a proposed 

settlement is in the public interest, a 

district court ‘‘must accord deference to 

the government’s predictions about the 

efficacy of its remedies, and may not 

require that the remedies perfectly 

match the alleged violations.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 17; see 

also Microsoft, 56 F.3d at 1461 (noting 

the need for courts to be ‘‘deferential to 

the government’s predictions as to the 

effect of the proposed remedies’’); 

United States v. Archer-DanielsMidland Co., 272 F. Supp. 2d 1, 6 

(D.D.C. 2003) (noting that the court 

should grant due respect to the United 

States’ prediction as to the effect of 

proposed remedies, its perception of the 

market structure, and its views of the 

nature of the case). 

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6See United States v. Enova Corp., 107 F. Supp. 

2d 10, 17 (D.D.C. 2000) (noting that the ‘‘Tunney 

Act expressly allows the court to make its public 

interest determination on the basis of the 

competitive impact statement and response to 

comments alone’’); United States v. Mid-Am. 

Dairymen, Inc., 1977–1 Trade Cas. (CCH) ¶ 61,508, 

at 71,980 (W.D. Mo. 1977) (‘‘Absent a showing of 

corrupt failure of the government to discharge its 

duty, the Court, in making its public interest 

finding, should * * * carefully consider the 

explanations of the government in the competitive 

impact statement and its responses to comments in 

order to determine whether those explanations are 

reasonable under the circumstances.’’); S. Rep. No. 

93–298, 93d Cong., 1st Sess., at 6 (1973) (‘‘Where 

the public interest can be meaningfully evaluated 

simply on the basis of briefs and oral arguments, 

that is the approach that should be utilized.’’). 

Courts have greater flexibility in 

approving proposed consent decrees 

than in crafting their own decrees 

following a finding of liability in a 

litigated matter. ‘‘[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.’ ’’ United 

States v. Am. Tel. & Tel. Co., 552 F. 

Supp. 131, 151 (D.D.C. 1982) (citations 

omitted) (quoting United States v. 

Gillette Co., 406 F. Supp. 713, 716 (D. 

Mass. 1975)), aff’d sub nom. Maryland 

v. United States, 460 U.S. 1001 (1983); 

see also United States v. Alcan 

Aluminum Ltd., 605 F. Supp. 619, 622 

(W.D. Ky. 1985) (approving the consent 

decree even though the court would 

have imposed a greater remedy). To 

meet this standard, the United States 

‘‘need only provide a factual basis for 

concluding that the settlements are 

reasonably adequate remedies for the 

alleged harms.’’ SBC Commc’ns, 489 F. 

Supp. 2d at 17. 

Moreover, the court’s role under the 

APPA is limited to reviewing the 

remedy in relationship to the violations 

that the United States has alleged in its 

Complaint, and does not authorize the 

court to ‘‘construct [its] own 

hypothetical case and then evaluate the 

decree against that case.’’ Microsoft, 56 

F.3d at 1459; see also InBev, 2009 U.S. 

Dist. LEXIS 84787, at *20 (‘‘[T]he ‘public 

interest’ is not to be measured by 

comparing the violations alleged in the 

complaint against those the court 

believes could have, or even should 

have, been alleged.’’). Because the 

‘‘court’s authority to review the decree 

depends entirely on the government’s 

exercising its prosecutorial discretion by 

bringing a case in the first place,’’ it 

follows that ‘‘the court is only 

authorized to review the decree itself,’’ 

and not to ‘‘effectively redraft the 

complaint’’ to inquire into other matters 

that the United States did not pursue. 

Microsoft, 56 F.3d. at 1459–60. Courts 

‘‘cannot look beyond the complaint in 

making the public interest 

determination unless the complaint is 

drafted so narrowly as to make a 

mockery of judicial power.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 15. 

In its 2004 amendments, Congress 

made clear its intent to preserve the 

practical benefits of utilizing consent 

decrees in antitrust enforcement, adding 

the unambiguous instruction that 

‘‘[n]othing in this section shall be 

construed to require the court to 

conduct an evidentiary hearing or to 

require the court to permit anyone to 

intervene.’’ 15 U.S.C. 16(e)(2). This 

language effectuates what Congress 

intended when it enacted the Tunney 

Act in 1974, as Senator Tunney 

explained: ‘‘[t]he court is nowhere 

compelled to go to trial or to engage in 

extended proceedings which might have 

the effect of vitiating the benefits of 

prompt and less costly settlement 

through the consent decree process.’’ 

119 Cong. Rec. 24,598 (1973) (statement 

of Senator Tunney). Rather, the 

procedure for the public interest 

determination is left to the discretion of 

the court, with the recognition that the 

court’s ‘‘scope of review remains sharply 

proscribed by precedent and the nature 

of Tunney Act proceedings.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 11.6

VIII. Determinative Documents 

There are no determinative materials 

or documents within the meaning of the 

APPA that the United States considered 

in formulating the proposed Final 

Judgment. 

Dated: February 22, 2010. 

Respectfully submitted, 

For Plaintiff The United States of America 

David E. Altschuler, 

Jade Alice Eaton, 

Trial Attorneys, United States Department of 

Justice, Antitrust Division, Transportation, 

Energy & Agriculture Section, 450 5th Street, 

NW., Suite 8000, Washington, DC 20530, 

Telephone: (202) 307–6316, 

david.altschuler@usdoj.gov, 

jade.eaton@usdoj.gov. 

[FR Doc. 2010–4545 Filed 3–3–10; 8:45 am] 

BILLING CODE 4410–11–P 

DEPARTMENT OF LABOR 

Occupational Safety and Health 

Administration 

[Docket No. OSHA–2010–0007] 

Definition and Requirements for a 

Nationally Recognized Testing 

Laboratory (NRTL); Extension of the 

Office of Management and Budget’s 

(OMB) Approval of Information 

Collection (Paperwork) Requirements 

AGENCY: Occupational Safety and Health 

Administration (OSHA), Labor. 

ACTION: Request for comment. 

SUMMARY: OSHA requests comment 

concerning its proposed extension of the 

information collection requirements 

specified by its Regulation on the 

Definition and Requirements for a 

Nationally Recognized Testing 

Laboratory (29 CFR 1910.7). The 

Regulation specifies procedures that 

organizations must follow to apply for, 

and to maintain, OSHA’s recognition to 

test and certify equipment, products, or 

material. 

DATES: Comments must be submitted 

(postmarked, sent, or received) by 

May 3, 2010. 

ADDRESSES: Electronically: You may 

submit comments and attachments 

electronically at http:// 

www.regulations.gov, which is the 

Federal eRulemaking Portal. Follow the 

instructions online for submitting 

comments. 

Facsimile: If your comments, 

including attachments, are not longer 

than 10 pages, you may fax them to the 

OSHA Docket Office at (202) 693–1648. 

Mail, hand delivery, express mail, 

messenger, or courier service: When 

using this method, you must submit 

three copies of your comments and 

attachments to the OSHA Docket Office, 

Docket No. OSHA–2010–0007, U.S. 

Department of Labor, Occupational 

Safety and Health Administration, 

Room N–2625, 200 Constitution 

Avenue, NW., Washington, DC 20210. 

Deliveries (hand, express mail, 

messenger, and courier service) are 

accepted during the Department of 

Labor’s and Docket Office’s normal 

business hours, 8:15 a.m. to 4:45 p.m., 

e.t. 

Instructions: All submissions must 

include the Agency name and OSHA 

docket number for the Information 

Collection Request (ICR) (OSHA–2010– 

0007). All comments, including any 

personal information you provide, are 

placed in the public docket without 

change, and may be made available 

online at http://www.regulations.gov. 

mstockstill on DSKH9S0YB1PROD with NOTICES