21286 Federal Register / Vol. 72, No. 82 / Monday, April 30, 2007 / Notices 

IOWA 

Dickinson County 

Antlers Hotel, 1703 Hill Ave., Spirit Lake, 

07000452 

Ringgold County 

Beaconsfield Supply Store, 1621 Main St., 

Beaconsfield, 07000451 

LOUISIANA 

Calcasieu Parish 

Muller’s Department Store (Boundary 

Increase), 619 Ryan St., Lake Charles, 

07000433 

MINNESOTA 

Dakota County 

Holz Family Farmstead, 4665 Manor Dr., 

Eagan, 07000459 

St. Louis County 

Stuntz Bay Boathouse Historic District, At 

the northern of Stuntz Bay Rd., Breitung 

Township, 07000460 

MISSOURI 

Pulaski County 

Osage Hills School, 1110 Glenwood S, 

Kirkwood, 07000462 

St. Louis Independent City 

General American Life Insurance Company 

National Headquarters, 706 Market St., St. 

Louis (Independent City), 07000461 

Lowell School, 1409 E. Linton, St. Louis 

(Independent City), 07000464 

Watcher Motor Car Company Building, 

(Auto-Related Resources of St. Louis, 

Missouri MPS) 2600–2614 Nebraska Ave., 

St. Louis (Independent City), 07000463 

MONTANA 

Fergus County 

Hogeland, Abraham and Mary Walton, 

House, (Lewistown MRA) 620 W. Montana 

St., Lewistown, 07000465 

PENNSYLVANIA 

Adams County 

Horner House and Barn, 20 Horner Rd., 

Cumberland Township, 07000468 

Delaware County 

Chester Waterside Station of the Philadelphia 

Electric Company, 2501 Seaport Dr., 

Chester, 07000467 

Washington County 

Wright, Enoch, House, 815 Venetia Rd., 

Peters Township, 07000466 

[FR Doc. E7–8124 Filed 4–27–07; 8:45 am] 

BILLING CODE 4312–51–P 

DEPARTMENT OF JUSTICE 

Antitrust Division 

United States v. Amsted Industries, 

Inc.; Proposed Final Judgment and 

Competitive Impact Statement 

Notice is hereby given pursuant to the 

Antitrust Procedures and Penalties Act 

(‘‘APPA’’), 15 U.S.C. 16(b)–(h), that a 

proposed Final Judgment, Hold Separate 

Stipulation and Order, and Competitive 

Impact Statement have been filed with 

the United States District Court for the 

District of Columbia in United States of 

America v. Amsted Industries. Inc., 

Civil Action No. 1:07–cv–00710. On 

April 18, 2007, the United States filed 

a Complaint alleging that the acquisition 

by Amsted Industries (‘‘Amsted’’) of the 

end-of-car cushioning assets (‘‘EOCCs’’) 

of FM Industries (‘‘FMI’’), a subsidiary 

of Progress Rail Services Holding 

Corporation, violated Section 7 of the 

Clayton Act, 15 U.S.C. 18, and Section 

2 of the Sherman Act, 15 U.S.C. 2. The 

proposed Final Judgment, filed at the 

same time as the Complaint, requires 

Amsted to divest without compensation 

all FMI intangible assets and all FMI 

tools and patterns used for imparting 

the shape, form, or finish to EOCCs. The 

proposed Final Judgment also requires 

Amsted to license royalty free and in 

perpetuity certain Amsted intangible 

assets and to make available all Amsted 

tools and patterns used for imparting 

the shape, form, or finish to EOCCs. 

Finally, the proposed Final Judgment 

requires Amsted to release market 

participants from restrictive covenants, 

as well as to notify the United States of 

future transactions. 

Copies of the Complaint, proposed 

Final Judgment, and Competitive Impact 

Statement are available for inspection at 

the U.S. Department of Justice, Antitrust 

Division, Antitrust Documents Group, 

325 7th Street, NW., Room 215, 

Washington, DC 20530 (telephone: 202–

514–2481), on the Department of 

Justice’s Web site at http:// 

www.usdoj.gov/atr, and at the Clerk 

Office of the Clerk of the United States 

District Court for the District of 

Columbia. 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 Maribeth Petrizzi, 

Chief, Litigation II, Antitrust Division, 

Department of Justice, Washington, DC 

20530, (telephone: 202–307–0924). 

J. Robert Kramer II, 

Director of Operations, Antitrust Division. 

United States District Court for the 

District of Columbia 

United States of America, Department of 

Justice, Antitrust Division, 1401 H Street, 

NW., Suite 3000, Washington, DC 20530, 

Plaintiff, v. Amsted Industries, Inc., Two 

Prudential Plaza, 180 North Stetson Street, 

Suite 1800, Chicago, IL 60601, Defendant. 

Case No. 1:07–CV–00710. Judge: Bates, John 

D. Deck Type: Antitrust. Date Stamp: April 

18, 2007. 

Complaint 

The United States of America, acting 

under the direction of the Attorney 

General of the United States, brings this 

civil antitrust action to obtain equitable 

and other relief against defendant 

Amsted Industries, Inc. (‘‘Amsted’’) to 

remedy the harm to competition caused 

by Amsted’s acquisition of FM 

Industries (‘‘FMI’’). The United States 

alleges as follows: 

I. Nature of Action 

1. Prior to Amsted’s acquisition of 

FMI on December 1, 2005, the two firms 

vigorously competed with each other to 

sell new and reconditioned end-of-car 

cushioning units (‘‘IEOCCs’’) to 

railroads throughout the United States. 

2. Amsted’s acquisition of FMI has 

reduced the number of new EOCC 

suppliers from two to one, resulting in 

a merger to monopoly. The transaction 

also has reduced the number of 

reconditioned EOCC suppliers from 

three to two. Amsted’s acquisition of 

FMI consolidated 90 percent of all 

EOCC sales in the United States. 

3. The transaction has substantially 

lessened competition in the design, 

manufacture, and sale of new and 

reconditioned EOCCs and has created a 

monopoly in the design, manufacture, 

and sale of new EOCCs. As a result, 

prices for new and reconditioned 

EOCCs have increased and likely will 

continue to increase, the quality of 

EOCCs likely will decline, innovation 

relating to EOCCs likely will decline, 

and services currently offered in the 

EOCC markets have become and will 

continue to be less favorable to railroad 

customers. The United States, through 

this suit, asks the court to declare the 

defendant’s conduct illegal and to 

restore the benefits of competition that 

were lost as a result of the transaction. 

II. Jurisdiction and Venue 

4. The United States brings this action 

against defendant Amsted under Section 

15 of the Clayton Act, 15 U.S.C. 25, as 


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amended, to prevent and restrain 

Amsted from continuing to violate 

Section 7 of the Clayton Act, 15 U.S.C. 

18, and Section 2 of the Sherman Act, 

15 U.S.C. 2. 

5. Defendant designs, manufactures, 

and sells new and reconditioned EOCCs 

in the flow of interstate commerce. 

Defendant’s activities in designing, 

manufacturing, and selling EOCCs 

substantially affect interstate commerce. 

This Court has subject matter 

jurisdiction over this action and over 

the defendant pursuant to Section 12 of 

the Clayton Act, 15 U.S.C. 22, and 28 

U.S.C. 1331, 1337(a), and 1345. 

6. Venue is proper in this district 

pursuant to 28 U.S.C. 1391(c). 

Defendant has consented to venue and 

personal jurisdiction in this judicial 

district. 

III. Parties to the Transaction 

7. Amsted is a Delaware corporation 

with its principal place of business in 

Chicago, Illinois. Amsted’s EOCC sales 

in the United States are made through 

its wholly owned subsidiary, ASFKeystone. ASF-Keystone is a Delaware 

corporation with its principal place of 

business in Granite City, IL. Amsted is 

a diversified manufacturer of industrial 

components for the railroad, vehicular, 

and construction markets. Amsted’s 

products include a range of railroad car 

parts, including couplers, side frames, 

bolsters, draft gears, and EOCCs. In 

2005, Amsted had approximately $2.5 

billion in sales. Amsted’s EOCC 

manufacturing facility is located in 

Camp Hill, PA. Amsted’s new and 

reconditioned EOCCs are shipped to 

customers throughout the United States 

and account for approximately $22 

million in sales. 

8. Progress Rail Services Holding 

Corporation (‘‘Progress Rail’’) is a 

Delaware corporation with its principal 

place of business in Albertville, AL and 

is a wholly owned subsidiary of 

Caterpillar, Inc., a Delaware corporation. 

Progress Rail is one of the largest 

suppliers of new and reconditioned 

railroad car parts, rail and trackwork 

components, and railroad car repair 

services to the railroad industry in the 

United States. Progress Rail has 

manufacturing facilities in 23 states, 

Canada, and Mexico. In 2005, Progress 

Rail had approximately $1.2 billion in 

sales. 

9. Progress Rail’s EOCC sales in the 

United States were made through its 

wholly owned subsidiary, FMI, formerly 

a Texas corporation with its principal 

place of business and EOCC 

manufacturing facility in Fort Worth, 

TX. FMI shipped new and 

reconditioned EOCCs to customers 

throughout the United States. In 2005, 

FMI had sales of approximately $24 

million. 

IV. The Transaction 

10. On December 1, 2005, Amsted and 

Progress Rail completed an asset swap 

by which Progress Rail conveyed to 

Amsted its wholly owned subsidiary, 

FMI. On April 25, 2006, Amsted 

dismantled FMI by firing its employees 

and disposing of virtually all FMI plant 

equipment through an auction. 

V. Trade and Commerce 

A. The Relevant Product Markets 

11. All freight cars undergo 

considerable stress from ‘‘longitudinal’’

forces, or forces exerted along the length 

of the train. During transit, freight cars 

are subjected to alternating longitudinal 

forces called draft and buff forces. Draft 

forces are pulling forces caused by train 

acceleration when freight cars are 

stretched or pulled apart. Buff forces are 

compressive forces caused by train 

deceleration when freight cars are 

pushed together. Freight cars also 

undergo considerable stress during 

switching and coupling at train depots. 

In order for a railroad to connect one 

freight car to another, it must collide the 

cars at significant speed. The impacts 

sustained during switching and 

coupling, like draft and buff forces, can 

cause serious damage to sensitive cargo 

inside a freight car. 

12. All freight cars are equipped with 

some type of energy absorption device 

to mitigate the effects of draft, buff, and 

coupling stresses. The most common 

device is a draft gear, which provides 

the minimum protection required for 

safe railroad operation. Draft gears rely 

on friction between two steel plates to 

absorb and dissipate the energy created 

by longitudinal forces impacting the 

freight car. Another type of device is 

commonly referred to as an ‘‘elastomeric 

device.’’ Elastomeric devices are 

lightweight and low cost, but they are 

not suitable for all applications as they 

return much of the absorbed energy 

back into the draft system. 

13. Railroads must use EOCCs, a 

specialized energy absorption device, 

when transporting sensitive cargos on 

freight cars. These shock absorbing 

devices use hydraulics (e.g., pressurized 

nitrogen gas and oils) to minimize 

longitudinal forces by absorbing and 

dissipating the maximum buff, draft, 

and coupling forces experienced during 

transit. By reducing and absorbing the 

forces exerted on freight cars, EOCCs 

ensure that sensitive cargo is not 

damaged during transit. Each EOCC unit 

consists of a piston, shaft, cylinder, end 

bells, and a rod that attaches the piston 

to the freight car coupler. Each EOCCequipped freight car requires two 

EOCCs, one at each end of the freight 

car. 

14. Other energy absorption devices, 

such as draft gears and elastomeric 

devices, do not provide the necessary 

level of cushioning required by 

customers shipping sensitive goods on 

freight cars. EOCCs therefore are critical 

components for freight cars carrying 

sensitive commodities, such as steel 

coils, automobile products, electronics, 

lumber, and paper products. Railroads 

and new freight car builders do not 

consider the price or availability of draft 

gears or elastomeric devices when 

soliciting prices for EOCCs from 

prospective suppliers. 

15. Though sensitive cargos can be 

transported by ‘‘intermodal’’ freight cars 

with articulated connectors, railroads 

cannot substitute intermodal 

transportation for freight cars equipped 

with EOCCs. Intermodal freight cars are 

specially designed railcars that allow 

standard cargo containers to be stacked 

for rail transport. The cars must travel 

in groups connected by a ‘‘slackless’’

articulated coupling system. The 

coupling system transfers longitudinal 

forces to the ends of the intermodal 

group, protecting the containers from 

damage. Intermodal freight cars with 

articulated connectors do not provide 

sufficient cushioning for sensitive 

commodities, cannot physically 

transport certain sensitive commodities 

(such as automobiles and certain lumber 

products), and are subject to additional 

costs and operational constraints. When 

soliciting prices for EOCCs from 

prospective suppliers, railroad 

customers do not consider the cost or 

availability of transporting goods using 

intermodal freight cars. 

16. Accordingly, railroad customers 

can use only freight cars equipped with 

EOCCs to carry certain sensitive goods 

and cannot substitute draft gears, 

elastomeric devices, or intermodal 

transport for EOCCs on freight cars. 

17. Railroad customers use either new 

or reconditioned EOCCs when 

equipping freight cars. However, 

customers building new freight cars 

almost always are required to use only 

new EOCCs in construction. Thus, 

customers building new freight cars 

would be unable to substitute 

reconditioned EOCCs in building new 

cars. 

18. Similarly, customers servicing 

older freight cars that have been in 

service for more than a decade almost 

always choose reconditioned EOCCs 

because the cost of reconditioned units 

is substantially lower than the cost of 


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new units. Thus, customers are unlikely 

to substitute new EOCCs for 

reconditioned EOCCs for use on older 

freight cars. 

19. A small but significant increase in 

the price of new EOCCs would not 

cause purchasers to substitute draft gear, 

elastomeric devices, intermodal cars, or 

reconditioned EOCCs so as to make 

such a price increase unprofitable. 

Accordingly, the design, manufacture, 

and sale of new EOCCs is a separate and 

distinct line of commerce and a relevant 

product market for the purpose of 

analyzing the effects of the acquisition 

under Section 7 of the Clayton Act and 

Section 2 of the Sherman Act. 

20. A small but significant increase in 

the price of reconditioned EOCCs would 

not cause purchasers to substitute draft 

gear, elastomeric devices, intermodal 

cars, or new EOCCs so as to make such 

a price increase unprofitable. 

Accordingly, the design, manufacture, 

and sale of reconditioned EOCCs is a 

separate and distinct line of commerce 

and a relevant product market for the 

purpose of analyzing the effects of the 

acquisition under Section 7 of the 

Clayton Act and Section 2 of the 

Sherman Act. 

B. The Relevant Geographic Market 

21. All EOCCs in the United States are 

designed, manufactured, and sold in the 

United States. Amsted sells, and FMI 

sold, EOCCs to customers located 

throughout the United States. 

22. The United States is the relevant 

geographic market for purposes of 

analyzing the effects of the acquisition 

under Section 7 of the Clayton Act and 

Section 2 of the Sherman Act. 

C. Anticompetitive Effects 

23. Before Amsted’s acquisition of 

FMI, the markets for EOCCs were highly 

concentrated. For new EOCCs, the 

merging entities were the only two 

suppliers. For reconditioned EOCCs, the 

market was limited to three suppliers, 

and the merging parties had a combined 

market share of over 80%. The markets 

became substantially more concentrated 

following the acquisition. Using the 

Herfindahl-Hirschman Index (‘‘HHI’’), 

an explanation of which appears in 

Appendix A attached hereto, the 

transaction resulted in a post-merger 

concentration of over 7000 (an increase 

of over 2700) in the market for 

reconditioned EOCCs, while the 

consolidation in the market for new 

EOCCs resulted in a monopoly. 

24. Amsted and FMI directly 

constrained each other’s prices, limiting 

overall price increases for new and 

reconditioned EOCCs despite significant 

materials cost increases. Before the 

transaction, Amsted created forecasts 

that contemplated significant price 

increases resulting from the merger. 

These price increases were aimed at 

achieving certain margin targets each 

year that would result in total additional 

profits of over $17 million during the 

first three years following the 

acquisition. According to the forecasts, 

achieving this goal would require an 

overall price increase of 4% in 2006, 

10% in 2007, and 5% in 2008, beyond 

increases in costs. 

25. Amsted pricing data shows that 

Amsted raised prices substantially 

following its acquisition of FMI. For 

new EOCCs, customers who did not 

have the pricing protection of long-term 

contracts paid on average approximately 

14% more in February 2006 than they 

did in November 2005. For 

reconditioned EOCCs, customers 

without long-term contracts paid an 

average increase of approximately 5% 

during the same time period. 

26. Purchasers of new and 

reconditioned EOCCs in the United 

States benefitted from the vigorous and 

aggressive competition between Amsted 

and FMI through lower prices, higher 

quality, more innovation, and better 

service. Without the competitive 

constraint of head-to-head competition 

from FMI, Amsted has had and will 

continue to have the ability to exercise 

market power by raising prices, 

lowering product quality, decreasing 

services, and lessening product 

innovation. 

27. The acquisition by Amsted of FMI 

has removed a significant competitor in 

the already highly concentrated new 

and reconditioned EOCC markets. The 

resulting substantial increase in 

concentration and loss of competition 

has denied EOCC customers the benefits 

of competition, in violation of Section 7 

of the Clayton Act and Section 2 of the 

Sherman Act. 

D. Entry Into the Production and Sale of 

New and Reconditioned EOCCs 

28. Entry into the design, 

manufacture, and sale of new or 

reconditioned EOCCs will not be timely, 

likely, or sufficient to counter the 

anticompetitive effects of the 

transaction. A new entrant to either 

market would require certifications and 

approvals from the Association of 

American Railroads (‘‘AAR’’), including 

facility certification and design 

certification for each EOCC model to be 

manufactured or reconditioned. 

Additionally, the AAR requires that a 

new entrant undergo a conditional 

approval period during which 

production is monitored and 

significantly limited. 

29. It is essential that a new entrant 

into either the new or reconditioned 

EOCC markets have sufficient technical 

know-how regarding the product in 

order to design and sell EOCCs. Thus, 

a new entrant must invest in significant 

design and engineering expertise in 

order to create the necessary tooling and 

intellectual property required to 

successfully manufacture new or 

reconditioned EOCCs according to AAR 

standards and railroad customer 

requirements. 

30. A new entrant into the new or 

reconditioned EOCC markets also must 

produce EOCCs in sufficient quantities 

and with sufficiently consistent quality 

to assure railroad customers that the 

new and reconditioned EOCCs will 

provide the necessary level of 

cushioning required to protect sensitive 

cargo. Achieving this quality reputation 

requires an additional investment in 

time and money by any new entrant. 

31. Although the manufacturing 

processes for new and reconditioned 

EOCCs are similar, both require unique 

inputs that are not readily available in 

the marketplace. For example, the 

manufacture of new EOCCs requires the 

use of patented designs and proprietary 

molds that are not needed in the 

reconditioning process. Similarly, the 

manufacture of reconditioned EOCCs 

requires the application of certain 

machining techniques and testing 

processes that are unique to the EOCC 

reconditioning market. 

32. Therefore, entry by any firm into 

the new or reconditioned EOCC markets 

would not be timely, likely, or sufficient 

to counter anticompetitive price 

increases imposed by Amsted. 

VI. First Cause of Action (Violation of 

Section 7 of the Clayton Act) 

33. The United States incorporates the 

allegations of paragraphs 1 through 32 

above. 

34. On or about December 1, 2005, 

Amsted acquired FMI and its associated 

EOCC assets used in the manufacture of 

new and reconditioned EOCCs. The 

effect of this acquisition has been 

substantially to lessen competition in 

interstate trade and commerce in 

violation of Section 7 of the Clayton 

Act. 

35. The transaction has had the 

following effects, among others: 

a. Competition in the new and 

reconditioned EOCC markets has been 

lessened substantially; 

b. Actual and potential competition 

between Amsted and FMI in the design, 

manufacture, and sale of new and 

reconditioned EOCCs in the United 

States has been eliminated; and 


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c. Prices for new and reconditioned 

EOCCs have increased and likely will 

continue to increase, the quality of 

EOCCs likely will decline, innovation 

relating to EOCCs likely will decline, 

and services currently offered in the 

EOCC markets have become and will 

continue to be less favorable to railroad 

customers. 

Second Cause of Action (Violation of 

Section 2 of the Sherman Act) 

36. The United States incorporates the 

allegations of paragraphs 1 through 32 

above. 

37. On or about December 1, 2005, 

Amsted willfully created monopoly 

power by acquiring FMI, its only 

competitor in the manufacture and sale 

of new EOCCs. The effect of this 

acquisition has been to create a 

monopoly in violation of Section 2 of 

the Sherman Act. 

38. The transaction has had the 

following effects, among others: 

a. The combination created a 

monopoly for the sale of new EOCCs in 

the United States; 

b. Actual and potential competition 

between Amsted and FMI in the design, 

manufacture, and sale of new EOCCs in 

the United States has been eliminated; 

and 

c. Prices for new EOCCs have 

increased and likely will continue to 

increase, the quality of new EOCCs 

likely will decline, innovation relating 

to new EOCCs likely will decline, and 

services currently offered in the new 

EOCC market have become and will 

continue to be less favorable to railroad 

customers. 

VII. Requested Relief 

39. The United States requests that 

this Court: 

a. Adjudge and decree the acquisition 

of FMI and its assets by defendant 

Amsted to violate Section 7 of the 

Clayton Act, 15 U.S.C. 18 and Section 

2 of the Sherman Act, 15 U.S.C. 2; 

b. Compel Amsted to divest all FMI 

EOCC intangible assets, in addition to 

all tools and patterns used for imparting 

the shape, form, or finish of EOCC 

components, and to take any further 

actions necessary to restore the market 

to the competitive position that existed 

prior to the acquisition; 

c. A ward the United States the cost 

of this action; and 

d. Grant the United States such other 

and further relief as the case requires 

and the Court deems just and proper. 

Respectfully submitted, 

April 18, 2007. 

For Plaintiff United States: 

/s/ lllllllllllllllllll

Gerald F. Masoudi Bar No. 466120, 

Deputy Assistant Attorney General. 

/s/ lllllllllllllllllll

J. Robert Kramer II, 

Director of Operations. 

/s/ lllllllllllllllllll

Maribeth Petrizzi Bar No. 435204, 

Chief, Litigation II Section. 

Dorothy B. Fountain Bar No. 439469, 

Assistant Chief, Litigation II Section. 

/s/ lllllllllllllllllll

C. Scott Hataway Bar No. 473942, 

Raven M. Norris, 

Robert W. Wilder, 

Attorneys U.S. Department of Justice 

Antitrust Division, Litigation II Section, 1401 

H Street, NW., Suite 3000, Washington, DC 

20530. 

Appendix A—Herfindahl-Hirschman 

Index 

‘‘HHI’’ means the Herfindahl-Hirschman 

Index, a commonly accepted measure of 

market concentration. It is calculated by 

squaring the market share of each firm 

competing in the market and then summing 

the resulting numbers. For example, for a 

market consisting of four firms with shares of 

thirty, thirty, twenty, and twenty percent, the 

HHI is 2600 (302 + 302 + 202 + 202 = 2600). 

The HHI takes into account the relative size 

and distribution of the firms in a market and 

approaches zero when a market consists of a 

large number of firms of relatively equal size. 

The HHI increases both as the number of 

firms in the market decreases and as the 

disparity in size between those firms 

increases. 

Markets in which the HHI is between 1000 

and 1800 points are considered to be 

moderately concentrated and those in which 

the HHI is in excess of 1800 points are 

considered to be highly concentrated. 

Transactions that increase the HHI by more 

than 100 points in highly concentrated 

markets presumptively raise antitrust 

concerns under the Horizontal Merger 

Guidelines issued by the U.S. Department of 

Justice and the Federal Trade Commission. 

See Horizontal Merger Guidelines § 1.51. 

Final Judgment 

Whereas, plaintiff, United States of 

America, filed its Complaint on April 

18, 2007, and the United States and 

defendant, Amsted Industries, Inc. 

(‘‘Amsted’’), by their respective 

attorneys, have consented to the entry of 

this Final Judgment without trial or 

adjudication of any issue of fact or law, 

and without this Final Judgment 

constituting any evidence against or 

admission by any party regarding any 

issue of fact or law; 

And whereas, Amsted agrees 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 the prompt and certain 

divestiture of certain rights and assets 

by Amsted to assure that competition is 

substantially restored; 

And whereas, the United States 

requires Amsted to make certain 

divestitures, grant certain licenses, 

release all market participants of any 

Restrictive Covenants, and provide 

notification of any future transactions 

within 10 years of this Final Judgment 

for the purpose of remedying the lost 

competition alleged in the Complaint; 

And Whereas, Amsted has 

represented to the United States that the 

divestitures, license grants, release of 

Restrictive Covenants, and notification 

of future transactions, as required 

below, can and will be made and that 

Amsted will later raise no claim of 

hardship or difficulty as grounds for 

asking the Court to modify any of the 

divestiture provisions contained below; 

Now Therefore, before any testimony 

is taken, without trial or adjudication of 

any issue of fact or law, and upon 

consent of the parties, it is Ordered, 

Adjudged and Decreed: 

I. Jurisdiction 

This Court has jurisdiction over the 

subject matter of and each of the parties 

to this action. The Complaint states a 

claim upon which relief may be granted 

against Amsted under Section 7 of the 

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

and Section 2 of the Sherman Act, 15 

U.S.C. 2. 

II. Definitions 

As used in this Final Judgment: 

A. ‘‘Amsted’’ means defendant 

Amsted Industries, Inc., a Delaware 

corporation with its headquarters in 

Chicago, IL, its successors and assigns, 

and its subsidiaries, divisions, groups, 

affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents, and employees. 

B. ‘‘FMI’’ means FM Industries, Inc., 

a Texas corporation and former 

subsidiary of Progress Rail, engaged in 

the development, production, and sale 

of EOCCs until it was acquired by 

Amsted on December 1, 2005. 

C. ‘‘Progress Rail’’ means Progress 

Rail Services Holding Corporation, a 

Delaware corporation with headquarters 

in Albertville, AL, its successors and 

assigns, and its subsidiaries, divisions, 

groups, affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents and employees. 

D. ‘‘EOCC’’ means end-of-car 

cushioning unit, a hydraulic energy 

absorption device used to absorb and 

dissipate buff, draft, and coupling forces 

exerted on freight railcars. 

E. ‘‘Acquirer’’ means Wabtec 

Corporation, the entity to whom Amsted 


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shall divest the Divested Assets and 

grant the Supplemental Asset License. 

F. ‘‘Alternative Acquirer’’ means the 

entity to whom Amsted shall divest the 

Divested Assets and grant the 

Supplemental Asset License in the 

event that the Acquirer is unable or 

unwilling to receive the Divested Assets 

or the Supplemental Asset License. 

G. ‘‘Divested Assets’’ means all FMI 

intangible assets owned or controlled by 

Amsted and all FMI tools and patterns 

owned or controlled by Amsted and 

used for imparting the shape, form, or 

finish to EOCC components, including: 

1. All detail and arrangement 

drawings, customer drawings, 

schematics, blueprints, designs, design 

validation testing reports, and design 

review notes; 

2. All specifications, manufacturing 

plans, assembly instructions, standard 

operating procedures, and work 

instructions related to the 

manufacturing process, including those 

related to tool speeds, feeds, special 

cutting tools, materials used, grinding 

and polishing, plating temperatures and 

processes, material thicknesses, seals, 

welding, and heat treatment; 

3. All dies, castings, patterns, molds, 

models, toolings, fixtures, jigs, and 

gages; 

4. All safety procedures and quality 

assurance documentation and 

instructions, including quality control 

plans, inspection frequency and criteria, 

work instructions, testing criteria, 

supplier manufacturing requirements, 

regulatory certifications, testing 

equipment specifications, surface finish 

instrument specifications, pressure/ 

leakage testing and specifications, gage 

specifications, product validation, 

qualification, acceptance, and rejection 

criteria, and all related empirical 

performance measurements, data, and 

reports; 

5. All supplier contact lists, customer 

contact lists, material lists, materials 

safety data sheets, substitute material 

lists, historic pricing and sales volume 

information, customer complaints, 

product serialization data, warranty 

information, product failure reports, 

market analyses, and all contracts, 

agreements, leases, commitments, or 

understandings with suppliers or 

customers; 

6. All intellectual property (‘‘IP’’) 

assets or rights that have been used in 

the development, production, servicing, 

and sale of EOCCs, including but not 

limited to the names ‘‘FMI,’’ ‘‘FM 

Industries,’’ and ‘‘Freight Master,’’ all 

patents, including FMI’s patented active 

draft technology (U.S. patent number 

6,237,733 ‘‘Internal neutral Positioning 

Spring’’), all licenses, rights, and 

sublicenses, trademarks, trade names, 

service marks, service names, technical 

information, computer software and 

related documentation, know-how, 

trade secrets, approvals, certifications, 

advertising literature, and all manuals 

and technical information provided to 

the employees, customers, suppliers, 

agents, or licensees of FMI; and 

7. All research data concerning 

historic and current research and 

development efforts, including designs 

of experiments, and the results of 

unsuccessful designs and experiments 

relating to the production and design of 

EOCCs. 

Among the Divested Assets, the 

divestiture of U.S. Patent number 

6,237,733 ‘‘Internal Neutral Positioning 

Spring’’ will be transferred subject to a 

perpetual, royalty-free license to 

Amsted. 

H. ‘‘Person’’ means any natural 

person, corporate entity, partnership, 

association, joint venture, government 

entity, or trust. 

I. ‘‘Restrictive Covenants’’ means all 

agreements, contracts, understandings, 

or arrangements between Amsted and 

any other person restricting competition 

in the development, production, and 

sale of EOCCs, including non-compete 

agreements between Amsted and former 

FMI employees; non-compete 

agreements between Amsted and 

current or former Amsted employees; 

and any exclusivity arrangements 

between Amsted and any of its 

suppliers or customers. The term 

Restrictive Covenants does not include 

Section 8.7 ‘‘Post-Closing NonCompete’’ of Amsted’s Asset Purchase 

Agreement with Progress Rail dated 

December 1, 2005. The term Restrictive 

Covenants does not include agreements 

between Amsted and Amsted’s current 

and former employees to the extent 

those agreements prevent the disclosure 

of confidential information. 

J. ‘‘Supplemental Asset License’’

means a perpetual royalty-free license to 

and copy of all Amsted’s intangible 

assets used in the development, 

production, or sale of EOCCs, and a 

limited license to use certain Amsted 

tangible assets used in the development, 

production, or sale of EOCCs, including: 

1. All detail and arrangement 

drawings, customer drawings, 

schematics, blueprints, designs, design 

validation testing reports, and design 

review notes; 

2. All specifications, manufacturing 

plans, assembly instructions, standard 

operating procedures, and work 

instructions related to the 

manufacturing process, including those 

related to tool speeds, feeds, special 

cutting tools, materials used, grinding 

and polishing, plating temperatures and 

processes, material thicknesses, seals, 

welding, and heat treatment; 

3. The use for two (2) years of all 

Amsted-owned or controlled dies, 

castings, patterns, molds, models, 

toolings, fixtures, jigs, and gages 

employed by Amsted suppliers in the 

production of EOCC components; 

4. All safety procedures and quality 

assurance documentation and 

instructions, including quality control 

plans, inspection frequency and criteria, 

work instructions, testing criteria, 

supplier manufacturing requirements, 

testing equipment specifications, 

surface finish instrument specifications, 

pressure/leakage testing and 

specifications, gage specifications, 

product validation, qualification, 

acceptance, and rejection criteria, and 

all related empirical performance 

measurements, data, and reports; and 

5. Amsted’s patented active draft 

technology, U.S. Patent number 

6,357,612 ‘‘Rail Car Cushioning 

Device;’’

The term ‘‘Supplemental Asset License’’

shall not include tangible or intangible 

assets exclusively used in the 

production or sale of products other 

than EOCCs, and also shall not include 

Amsted cost data, price data, revenue 

data, research and development 

information, or customer contract 

information. 

III. Applicability 

A. This Final Judgment applies to 

Amsted, as defined above, and all other 

persons in active concert or 

participation with it who receive actual 

notice of this Final Judgment by 

personal service or otherwise. 

B. Amsted shall require, as a 

condition of the sale or other 

disposition of all or substantially all of 

their assets or of lesser business units 

that include the Divested Assets, or the 

assets underlying the Supplemental 

Asset License, that the purchaser will 

agree to be bound by the provisions of 

this Final Judgment. 

IV. Divestiture 

A. Amsted is hereby ordered and 

directed, within sixty (60) calendar days 

after the filing of the Complaint in this 

matter, or five (5) days after notice of the 

entry of this Final Judgment by the 

Court, whichever is later, to divest the 

Divested Assets and grant the 

Supplemental Asset License to the 

Acquirer, all in a manner consistent 

with this Final Judgment. The United 

States, in its sole discretion, may agree 

to one or more extensions of this time 

period not to exceed sixty (60) days in 


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total, and shall notify the Court in such 

circumstances. Amsted agrees to use its 

best efforts to divest the Divested Assets 

and grant the Supplemental Asset 

License as expeditiously as possible. 

Amsted also agrees that it shall receive 

no compensation or anything of value 

for divesting the Divested Assets or 

granting the Supplemental Asset 

License pursuant to this Final Judgment. 

B. In accomplishing the divestiture 

and licenses ordered by this Final 

Judgment, Amsted promptly shall 

inform the Acquirer that the Divested 

Assets and Supplemental Asset License 

are being conveyed pursuant to this 

Final Judgment and provide the 

Acquirer a copy of this Final Judgment. 

Amsted shall offer to furnish to the 

Acquirer, subject to customary 

confidentiality assurances, all 

information and documents relating to 

the Divested Assets and Supplemental 

Asset License customarily provided in a 

due diligence process, except such 

information or documents subject to the 

attorney-client or work-product 

privileges. Amsted shall make available 

such information to the United States at 

the same time that such information is 

made available to any other person. 

C. Amsted shall permit the Acquirer 

to have reasonable access to personnel 

and to any and all financial, operational, 

or other documents and information 

customarily provided as part of a due 

diligence process. Amsted shall provide 

information giving the identity and 

function of the personnel involved in 

the operation and management of both 

Amsted and FMI to enable the Acquirer 

to make offers of employment. Amsted 

will not interfere with any negotiations 

by the Acquirer to employ any Amsted 

employee. 

D. Amsted shall unilaterally release 

all persons from any Restrictive 

Covenants related to the production, 

development, or sale of EOCCs. If after 

one year from the entry of this Final 

Judgment, the Acquirer has failed to 

deliver an EOCC manufactured or 

reconditioned by the Acquirer to a 

railroad industry customer, Amsted 

shall also unilaterally release Progress 

Rail from Section 8.7 of Amsted’s Asset 

Purchase Agreement with Progress Rail 

dated December 1, 2005 (’’Post-Closing 

Non-Compete’’). 

E. Amsted shall preserve and 

maintain the Divested Assets and the 

assets licensed under the Supplemental 

Asset License and shall not license, 

transfer, encumber, or otherwise impair 

the value of such assets while the 

divestiture is pending. 

F. Amsted shall use commercially 

reasonable efforts to facilitate the 

transfer of EOCC cores from Amsted’s 

facilities at the request of railroad 

customers. Amsted shall take no action 

the effect of which is to interfere with 

or impede the transfer of EOCC cores 

owned by railroad customers to the 

Acquirer or the ability of the Acquirer 

to compete effectively in the sale of 

reconditioned EOCCs. 

G. Amsted shall not take any action 

that will impede in any way the 

permitting, operation, or divestiture of 

the Divested Assets or Supplemental 

Asset License. 

H. Unless the United States otherwise 

consents in writing, the divestiture 

pursuant to Section IV of this Final 

Judgment shall include the entire 

Divested Assets and Supplemental 

Asset License, and shall be 

accomplished in such a way as to satisfy 

the United States, in its sole discretion, 

that the Divested Assets and 

Supplemental Asset License can and 

will be used by the Acquirer as part of 

an economically viable, ongoing 

business engaged in the production and 

sale of EOCCs in the United States. The 

divestiture shall be accomplished so as 

to satisfy the United States, in its sole 

discretion, that: 

1. The Divestiture Assets and 

Supplemental Asset License will remain 

viable and that the divestiture will 

remedy the competitive harm alleged in 

the Complaint; and 

2. None of the terms of any agreement 

between the Acquirer and Amsted gives 

Amsted the ability unreasonably to raise 

the Acquirer’s costs, to lower the 

Acquirer’s efficiency, or otherwise to 

interfere in the ability of the Acquirer to 

compete effectively in the production 

and sale of EOCCs. 

V. Appointment of Trustee To Effect 

Divestiture 

A. In the event that the Acquirer is 

unable or unwilling to receive the 

Divested Assets and Supplemental 

Asset License, Amsted shall notify the 

United States of that fact in writing. 

Upon application of the United States, 

the Court shall appoint a trustee 

selected by the United States and 

approved by the Court to effect the 

divestiture of the Divested Assets and 

the grant of the Supplemental Asset 

License in a manner consistent with this 

Final Judgment to an Alternative 

Acquirer approved by the United States 

in its sole discretion. 

B. Amsted shall use commercially 

reasonable efforts to facilitate the 

transfer of EOCC cores from Amsted’s 

facilities at the request of railroad 

customers. Amsted shall take no action 

the effect of which is to interfere with 

or impede the transfer of EOCC cores 

owned by railroad customers to the 

Alternative Acquirer or the ability of the 

Alternative Acquirer to compete 

effectively in the sale of reconditioned 

EOCCs. 

C. Unless the United States otherwise 

consents in writing, the divestiture 

pursuant to Section V of this Final 

Judgment shall include the entire 

Divested Assets and Supplemental 

Asset License, and shall be 

accomplished in such a way as to satisfy 

the United States, in its sole discretion, 

that the Divested Assets and 

Supplemental Asset License can and 

will be used by the Alternative Acquirer 

as part of an economically viable, 

ongoing business engaged in the 

production and sale of EOCCs in the 

United States. The divestiture shall be 

accomplished so as to satisfy the United 

States, in its sole discretion, that: 

1. The Alternative Acquirer has the 

intent and capability (including the 

necessary managerial, operational, 

technical, and financial capability) to 

compete effectively in the production 

and sale of EOCCs; 

2. None of the terms of any agreement 

between the Alternative Acquirer and 

Amsted gives Amsted the ability 

unreasonably to raise the Alternative 

Acquirer’s costs, to lower the 

Alternative Acquirer’s efficiency, or 

otherwise to interfere in the ability of 

the Alternative Acquirer to compete 

effectively in the production and sale of 

EOCCs; and 

3. The Divested Assets and 

Supplemental Asset License will remain 

economically viable and the divestiture 

will remedy the competitive harm 

alleged in the Complaint. 

D. After the appointment of a trustee 

becomes effective, only the trustee shall 

have the right to convey the Divested 

Assets and Supplemental Asset License. 

The trustee shall have the power and 

authority to accomplish the divestiture 

to an Alternative Acquirer approved by 

the United States, subject to the 

provisions of Sections IV, V, and VI of 

this Final Judgment, and shall have 

such other powers as this Court deems 

appropriate. The divestiture of the 

Divested Assets and the grant of the 

Supplemental Asset License shall be 

made without any cost to the 

Alternative Acquirer or any 

compensation to Amsted. Subject to 

Section V(E) of this Final Judgment, the 

trustee may hire at the cost and expense 

of Amsted any investment bankers, 

attorneys, accountants, or any other 

agents and outside contractors who 

shall be solely accountable to the 

trustee, reasonably necessary in the 

trustee’s judgment to assist in the 

divestiture. 


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E. Amsted shall not object to a grant 

or conveyance by the trustee on any 

ground other than the trustee’s 

malfeasance. Any such objections by 

Amsted must be 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. 

F. The trustee shall serve at the cost 

and expense of Amsted, on such terms 

and conditions as the United States 

approves, and shall account for all costs 

incurred from the conveyance of the 

Divested Assets and Supplemental 

Asset License. The compensation of the 

trustee and any professionals and agents 

retained by the trustee shall be 

reasonable in light of the fair market 

value of the Divested Assets and 

Supplemental Asset License, and based 

on a fee arrangement providing the 

trustee with an incentive based on the 

speed with which the divestiture is 

accomplished. 

G. Amsted shall use its best efforts to 

assist the trustee in accomplishing the 

required divestiture. The trustee and 

any consultants, accountants, attorneys, 

and other persons retained by the 

trustee shall have full and complete 

access to the personnel, books, records, 

and facilities relating to the assets to be 

divested, and the Supplemental Asset 

License; and Amsted shall develop 

financial and other information relevant 

to such business as the trustee may 

reasonably request, subject to customary 

confidentiality protection. Amsted shall 

take no action to interfere with or to 

impede the trustee’s accomplishment of 

the divestiture. 

H. After appointment, the trustee 

shall file monthly reports with the 

United States and the Court setting forth 

the trustee’s efforts to accomplish the 

divestiture ordered under this Final 

Judgment. To the extent such reports 

contain information that the trustee 

deems confidential, such reports shall 

not be filed in the public docket of the 

Court. Such reports shall include the 

name, address, and telephone number of 

each person who, during the preceding 

month, made an offer to acquire, 

expressed an interest in acquiring, 

entered into negotiations to acquire, or 

was contacted or made an inquiry about 

acquiring, any interest in the Divested 

Assets or Supplemental Asset License 

and shall describe in detail each contact 

with any such person. The trustee shall 

maintain full records of all efforts made 

to divest the Divested Assets or grant 

the Supplemental Asset License. 

I. If the trustee has not accomplished 

such divestiture within six (6) months 

after its appointment, the trustee shall 

promptly file 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. 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 

United States who shall have the right 

to make additional recommendations 

consistent with the purpose of the trust. 

The Court thereafter shall enter such 

orders as it shall deem appropriate to 

carry out the purpose of the Final 

Judgment, which may, if necessary, 

include extending the trust and the term 

of the trustee’s appointment by a period 

requested by the United States. 

VI. Notice of Proposed Divestiture 

A. Within two (2) business days 

following execution of a definitive 

divestiture agreement, the trustee shall 

notify the United States and Amsted of 

any proposed divestiture required by 

Section V of this Final Judgment. The 

notice shall set forth the details of the 

proposed divestiture and grant of the 

Supplemental Asset License, and list 

the name, address, and telephone 

number of each person not previously 

identified who offered or expressed an 

interest in or desire to acquire any 

ownership interest in the Divested 

Assets or the Supplemental Asset 

License together with full details of the 

same. 

B. Within fifteen (15) calendar days of 

receipt by the United States of such 

notice, the United States may request 

from Amsted, the proposed Alternative 

Acquirer, any other third party, or the 

trustee if applicable, additional 

information concerning the proposed 

divestiture, the proposed Alternative 

Acquirer, and any other potential 

Alternative Acquirer. Amsted 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. 

C. Within (a) thirty (30) calendar days 

after receipt of the notice or (b) twenty 

(20) calendar days after the United 

States has been provided the additional 

information requested from Amsted, the 

proposed Alternative Acquirer, any 

third party, or the trustee, whichever is 

later, the United States shall provide 

written notice to Amsted and the trustee 

stating whether or not it objects to the 

proposed divestiture. If the United 

States provides written notice that it 

does not object, the divestiture may be 

consummated, subject only to Amsted’s 

limited right to object to the conveyance 

under Section V(E) of this Final 

Judgment. Absent written notice that the 

United States does not object to the 

proposed Alternative Acquirer or upon 

objection by the United States, the 

divestiture proposed under Section V 

shall not be consummated. Upon 

objection by Amsted under Section 

V(E), the divestiture proposed under 

Section V shall not be consummated 

unless approved by the Court. 

VII. Financing 

Amsted shall not finance all or any 

part of any purchase or divestiture made 

pursuant to Section IV or V of this Final 

Judgment. 

VIII. Hold Separate 

Until the divestiture required by this 

Final Judgment has been accomplished, 

Amsted shall take all steps necessary to 

comply with the Hold Separate 

Stipulation and Order entered by this 

Court. Amsted shall take no action that 

would jeopardize the divestiture 

ordered by this Court. 

IX. Affidavits 

A. Within twenty (20) calendar days 

of the filing of the Complaint in this 

matter, and every thirty (30) calendar 

days thereafter until the divestiture has 

been completed under Section IV or V, 

Amsted shall deliver to the United 

States an affidavit as to the fact and 

manner of its compliance with Section 

IV or V of this Final Judgment. Each 

such affidavit shall describe in detail 

each contact with any person who, 

during the preceding thirty (30) days, 

made an offer to acquire, expressed an 

interest in acquiring, entered into 

negotiations to acquire, or was 

contacted or made an inquiry about 

acquiring, any interest in the Divested 

Assets or Supplemental Asset License 

including the Acquirer or any potential 

Alternative Acquirer. Each such 

affidavit shall also include a description 

of the efforts Amsted has taken to 

convey the Divested Assets and 

Supplemental Asset License, and to 

provide required information to the 

Acquirer, 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 Amsted, including limitations on the 

information, shall be made within 

fourteen (14) calendar days of receipt of 

such affidavit. 

B. Within twenty (20) calendar days 

of the filing of the Complaint in this 

matter, Amsted shall deliver to the 

United States an affidavit that describes 

all actions Amsted has taken and all 


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steps Amsted has implemented on an 

ongoing basis to comply with Section 

VIII of this Final Judgment. Amsted 

shall deliver to the United States an 

affidavit describing any changes to the 

efforts and actions outlined in Amsted’s 

earlier affidavits filed pursuant to this 

section within fifteen (15) calendar days 

after the change is implemented. 

C. Amsted shall keep all records of all 

efforts made to preserve the Divested 

Assets and to convey the Divested 

Assets and Supplemental Asset License 

until one year after such divestiture has 

been completed. 

X. Compliance Inspection 

A. For the purpose of determining or 

securing compliance with this Final 

Judgment, or of determining whether 

the Final Judgment should be modified 

or vacated, and subject to any legally 

recognized privilege, from time to time 

duly authorized representatives of the 

United States Department of Justice, 

including consultants and other persons 

retained by the United States, shall, 

upon written request of a duly 

authorized representative of the 

Assistant Attorney General in charge of 

the Antitrust Division, and on 

reasonable notice to Amsted, be 

permitted: 

1. Access during Amsted’s office 

hours to inspect and copy, or at the 

United States’ option, to require Amsted 

to provide copies of, all books, ledgers, 

accounts, records and documents in the 

possession, custody, or control of 

Amsted, relating to any matters 

contained in this Final Judgment; and 

2. To interview, either informally or 

on the record, Amsted’s officers, 

employees, or agents, who may have 

their individual counsel present, 

regarding such matters. The interviews 

shall be subject to the reasonable 

convenience of the interviewee and 

without restraint or interference by 

Amsted. 

B. Upon the written request of a duly 

authorized representative of the 

Assistant Attorney General in charge of 

the Antitrust Division, Amsted shall 

submit written reports, under oath if 

requested, relating to any of the matters 

contained in this Final Judgment as may 

be requested. 

C. No information or documents 

obtained by the means provided in this 

section shall be divulged by the United 

States to any person other than an 

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 Amsted to 

the United States, Amsted 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 

Amsted 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 

the United States shall give Amsted ten 

(10) calendar days notice prior to 

divulging such material in any legal 

proceeding (other than a grand jury 

proceeding). 

XI. Notification of Future Transactions 

A. Unless such transaction is 

otherwise subject to the reporting and 

waiting period requirements of the HartScott-Rodino Antitrust Improvements 

Act of 1976, as amended, 15 U.S.C. 18a 

(the ‘‘HSR Act’’), Amsted shall not, 

without notifying the United States, 

directly or indirectly acquire any assets 

of or any interest, including any 

financial, security, loan, equity, or 

management interest, in the 

development, production, or sale of 

EOCCs in the United States if the value 

of such acquisition exceeds $1,000,000. 

This notification requirement shall run 

for a period of ten years. 

B. Such notification shall be provided 

to the United States in the same format 

as, and per the instructions relating to, 

the Notification and Report Form set 

forth in the Appendix to Part 803 of 

Title 16 of the Code of Federal 

Regulations as amended, except that the 

information requested in Items 5 

through 9 of the instructions must be 

provided only about EOCCs. 

Notification shall be provided at least 

thirty (30) days prior to acquiring any 

such assets or interest, and shall 

include, beyond what may be required 

by the applicable instructions, the 

names of the principal representatives 

of the parties to the agreement who 

negotiated the agreement, and any 

management or strategic plans 

discussing the proposed transaction. If 

within the 30-day period after 

notification, representatives of the 

United States make a written request for 

additional information, Amsted shall 

not consummate the proposed 

transaction or agreement until twenty 

(20) days after submitting all such 

additional information. Early 

termination of the waiting periods in 

this paragraph may be requested and, 

where appropriate, granted in the same 

manner as is applicable under the 

requirements and provisions of the HSR 

Act and rules promulgated thereunder. 

This Section shall be broadly construed 

and any ambiguity or uncertainty 

regarding the filing of notice under this 

Section shall be resolved in favor of 

filing notice. 

XII. No Reacquisition 

Amsted may not reacquire any part of 

the Divested Assets or any right, title or 

interest in the Supplemental Asset 

License during the term of this Final 

Judgment. 

XIII. 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. 

XIV. Expiration of Final Judgment 

Unless this Court grants an extension, 

this Final Judgment shall expire ten 

years from the date of its entry. 

XV. 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 the United States’ 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. 

Date: llllllllllllllllll

Court approval subject to procedures of the 

Antitrust Procedures and Penalties Act, 15 

U.S.C. 16. 

lllllllllllllllllllll

United States District Judge. 

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 Proceeding 

This case was brought because 

Defendant Amsted Industries, Inc. 

(‘‘Amsted’’) acquired all of the assets of 


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1Progress Rail was subsequently acquired by 

Caterpillar Inc. on May 16, 2006. 

FM Industries, Inc. (‘‘FMI’’), a business 

unit of Progress Rail Services Holding 

Corporation, Inc. (‘‘Progress Rail’’).1 On 

April 25, 2006, Amsted dismantled FMI 

by firing its employees and disposing of 

virtually all FMI plant equipment 

through an auction. The United States 

filed a civil antitrust Complaint on April 

18, 2007, alleging that the acquisition 

lessened competition substantially for 

the design, manufacture, and sale of 

new and reconditioned end-of-car 

cushioning units (‘‘EOCCs’’) in violation 

of Section 7 of the Clayton Act, 15 

U.S.C. 18, and Section 2 of the Sherman 

Act, 15 U. S. C. 2. This loss of 

competition has impacted the rail 

industry through higher prices, reduced 

services, and decreased innovation. 

At the same time the Complaint was 

filed, the United States also filed a Hold 

Separate Stipulation and Order and 

proposed Final Judgment, which are 

designed to eliminate the 

anticompetitive effects of the 

acquisition. Under the proposed Final 

Judgment, Amsted is required to divest 

without compensation all intellectual 

property and other intangible assets that 

it acquired from Progress Rail. In 

addition, Amsted is required to grant a 

perpetual, royalty-free license to certain 

Amsted-generated intellectual property 

and notify the United States of future 

acquisitions related to EOCCs. Under 

the terms of the Hold Separate 

Stipulation and Order, Amsted will take 

steps to ensure that the divested assets 

remain economically viable during the 

pendency of the ordered divestiture. 

The United States and the defendant 

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. The Parties to the Consummated 

Transaction 

Amsted is a diversified manufacturer 

of industrial components for the 

railroad, vehicular, and construction 

markets. Its products include a range of 

railroad car parts, including couplers, 

side frames, bolsters, draft gears; and 

EOCCs. Amsted’s EOCC sales in the 

United States are made through its 

wholly owned subsidiary, ASF–

Keystone. ASF–Keystone is a Delaware 

corporation with its principal place of 

business in Granite City, IL. 

Progress Rail, a wholly owned 

subsidiary of Caterpillar, Inc., is one of 

the largest suppliers of new and 

reconditioned railroad car parts, rail and 

trackwork components, and railroad car 

repair services to the railroad industry 

in the United States. Progress Rail’s 

EOCC sales in the United States were 

made through its wholly owned 

subsidiary, FMI, formerly a Texas 

corporation with its principal place of 

business and EOCC manufacturing 

facility in Fort Worth, Texas. 

Prior to the merger, Amsted and FMI 

were the only two manufacturers of new 

EOCCs and two of only three 

manufacturers of reconditioned EOCCs. 

The transaction lessened competition 

substantially for these products. As a 

result, prices for new and reconditioned 

EOCCs have increased and likely will 

continue to increase, the quality of 

EOCCs likely will decline, innovation 

relating to EOCCs likely will decline, 

and services currently offered in the 

EOCC markets have become and will 

continue to be less favorable to railroad 

customers. 

B. The Relevant Product Market: End-ofCar Cushioning Units 

Railroad freight cars undergo 

considerable stress during transit due to 

longitudinal forces known as draft and 

buff forces. Draft forces are pulling 

forces caused by train acceleration when 

freight cars are stretched or pulled apart. 

Buff forces are compressive forces 

caused by train deceleration when 

freight cars are pushed together. If not 

absorbed and dissipated, the energy 

from draft and buff forces can cause 

considerable damage to both car and 

cargo. Freight cars also undergo 

considerable stress during switching 

and coupling at train depots. In order 

for a railroad to connect one freight car 

to another, it must collide the cars at 

significant speed. The impact sustained 

during switching and coupling, like 

draft and buff forces, can cause serious 

damage to sensitive cargo inside a 

freight car. 

Railroads must equip all freight cars 

with energy absorption devices to 

mitigate the effects of draft, buff, and 

coupling stresses. The most common 

device is known as a draft gear, which 

provides the minimum protection 

required for safe railroad operation. 

Draft gears rely on friction between two 

steel plates to absorb and dissipate the 

energy created by longitudinal forces 

impacting the freight car. Another type 

of device is commonly referred to as an 

‘‘elastomeric’’ device. These devices use 

an elastic substance (e.g., rubber) and 

steel coils to absorb the draft, buff, and 

coupling stresses. Elastomeric devices 

are lightweight and low cost, but they 

are not suitable for all applications as 

they return much of the absorbed energy 

back into the draft system. Neither draft 

gears nor elastomers are sufficient to 

protect sensitive cargos. 

When transporting sensitive cargos in 

traditional freight cars, railroads must 

use EOCCs to absorb and dissipate the 

maximum buff, draft, and coupling 

forces. These devices use hydraulics 

(e.g., pressurized nitrogen gas and oils) 

to minimize longitudinal forces and 

ensure that sensitive cargo is not 

damaged during transit. Each EOCC unit 

consists of a piston, shaft, cylinder, end 

bells, and a rod that attaches the piston 

to the freight car coupler. Each EOCCequipped freight car requires two 

EOCCs, one at each end of the freight 

car. EOCCs are critical components for 

freight cars carrying sensitive 

commodities, such as steel products, 

automobile products, electronics, 

lumber, and paper products. Other 

energy absorption devices, such as draft 

gears and elastomeric devices, do not 

provide the necessary level of 

cushioning required by customers 

shipping sensitive goods on freight cars. 

Railroads and new freight car builders 

do not consider prices or availability of 

draft gears or elastomeric devices when 

soliciting prices for EOCCs from 

prospective suppliers. 

Though sensitive cargos can be 

transported by ‘‘intermodal’’ freight cars 

with articulated connectors, railroads 

cannot substitute intermodal 

transportation for freight cars equipped 

with EOCCs, Intermodal freight cars are 

specially designed railcars that allow 

standard cargo containers to be stacked 

for rail transport. The cars must travel 

in groups connected by a ‘‘slackless’’

articulated coupling system. The 

coupling system transfers longitudinal 

forces to the ends of the intermodal 

group, protecting the containers from 

damage. Despite their suitability for 

certain applications, intermodal freight 

cars do not provide sufficient 

cushioning for some sensitive 

commodities, cannot physically 

transport certain sensitive commodities 

(such as automobiles and certain lumber 

products), and are typically much more 

expensive to own and operate than 

freight cars equipped with EOCCs. The 

intermodal groups must also travel to 

the same destination due to their 

slackless connection. Because of these 

additional costs and operational 

constraints, intermodal rail 

transportation in North America tends 

to be most economical for large 

shipments manufactured outside of 


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2American Hydraulics, Inc. is the only other 

manufacturer certified by the Association of 

American Railroads (‘‘AAR’’) to build new units. 

However, American Hydraulics historically has had 

no revenue in this product area, and customers 

uniformly viewed the merging parties as the only 

suppliers of new EOCCs. 

3 ‘‘HHI’’ means the Herfindahl-Hirschman Index, 

a commonly accepted measure of market 

concentration. It is calculated by squaring the 

market share of each firm competing in the market 

and then summing the resulting numbers. For 

example, for a market consisting of four firms with 

shares of thirty, thirty, twenty, and twenty percent, 

the HHI is 2600 (302 + 302 + 202 + 202 = 2600). 

The HHI takes into account the relative size and 

distribution of the firms in a market and approaches 

zero when a market consists of a large number of 

firms of relatively equal size. The HHI increases 

both as the number of firms in the market decreases 

and as the disparity in size between those firms 

increases. Markets in which the HHI is between 

1000 and 1800 points are considered to be 

moderately concentrated, and those in which the 

HHI is in excess of 1800 points are considered to 

be concentrated. Transactions that increase the HHI 

by more than 100 points in concentrated markets 

presumptively raise antitrust concerns under the 

Horizontal Merger Guidelines issued by the U.S. 

Department of Justice and the Federal Trade 

Commission. See Merger Guidelines ¶ 1.51. 

North America and imported by sea. 

When soliciting prices for EOCCs from 

prospective suppliers, railroad 

customers do not consider the cost of 

transporting goods using intermodal 

freight cars with articulated connectors. 

Railroad customers may use either 

new or reconditioned EOCCs when 

equipping freight cars. However, 

customers building new freight cars are 

almost always required to use only new 

EOCCs in construction. Though higher 

cost, these new units are highly durable 

and invariably protected by an industry 

standard ten-year warranty. The vast 

majority of customers building new 

freight cars would be unable to use 

reconditioned EOCCs in construction. 

Similarly, customers servicing older 

freight cars that have been in service for 

more than a decade almost always 

choose reconditioned EOCCs because 

the cost of reconditioned units is 

substantially lower than the cost of new 

units. Thus, customers are unlikely to 

substitute new EOCCs for reconditioned 

EOCCs for use on older freight cars. 

A small but significant increase in the 

price of new EOCCs would not cause 

purchasers to substitute draft gear, 

elastomeric devices, intermodal cars, or 

reconditioned EOCCs so as to make 

such a price increase unprofitable. 

Accordingly, the design, manufacture, 

and sale of new EOCCs is a separate and 

distinct line of commerce and a relevant 

product market for the purpose of 

analyzing the effects of the acquisition 

under Section 7 of the Clayton Act, 15 

U.S.C. 18, and Section 2 of the Sherman 

Act, 15 U.S.C. 2. Likewise, a small but 

significant increase in the price of 

reconditioned EOCCs would not cause 

purchasers to substitute draft gear, 

elastomeric devices, intermodal cars, or 

new EOCCs so as to make such a price 

increase unprofitable. Accordingly, the 

design, manufacture, and sale of 

reconditioned EOCCs is also a separate 

and distinct line of commerce and a 

relevant product market for the purpose 

of analyzing the effects of the 

acquisition under Section 7 of the 

Clayton Act and Section 2 of the 

Sherman Act. 

C. The Relevant Geographic Market 

All EOCCs in the United States are 

designed, manufactured, and sold in the 

United States. Amsted sells, and FMI 

sold, EOCCs to customers located 

throughout the United States. The 

United States is the relevant geographic 

market for purposes of analyzing the 

effects of the acquisition under Section 

7 of the Clayton Act and Section 2 of the 

Sherman Act. 

D. The Competitive Effects of the 

Transaction on End-of-Car Cushioning 

Prior to Amsted’s acquisition of FMI, 

the markets for EOCCs were highly 

concentrated. For new EOCCs, the 

merging entities were the only two 

suppliers.2 For reconditioned EOCCs, 

the market was limited to three 

suppliers, and the merging parties 

controlled over 80% of the market. 

Thus, the markets were highly 

concentrated and became substantially 

more so following the acquisition. Using 

the Herfindahl-Hirschman Index 

(‘‘HHI’’),3 the consolidation in the 

market for reconditioned EOCCs 

resulted in a post-merger concentration 

of over 7000 (an increase of over 2700), 

while the consolidation in the market 

for new EOCCs resulted in a monopoly. 

Amsted and FMI directly constrained 

each other’s prices, limiting overall 

price increases for new and 

reconditioned EOCCs. Prior to the 

transaction, Amsted created forecasts 

that contemplated significant price 

increases resulting from the merger. 

These price increases were aimed at 

achieving certain margin targets each 

year that would result in total additional 

profits of over $17 million during the 

first three years following the 

transaction. According to the forecasts, 

achieving this goal would require an 

overall price increase of 4% in 2006, 

10% in 2007, and 5% in 2008, beyond 

materials cost increase surcharges. 

Amsted pricing data shows that Amsted 

raised prices substantially following its 

acquisition of FMI. For new EOCCs, 

customers who did not have the pricing 

protection of long-term contracts paid 

on average approximately 14% more in 

February 2006 than they did in 

November 2005. For reconditioned 

EOCCs, customers without long-term 

contracts paid an average increase of 

approximately 5% more during the 

same time period. 

Purchasers of new and reconditioned 

EOCCs in the United States benefitted 

from vigorous and aggressive 

competition between Amsted and FMI 

through lower prices, higher quality, 

more innovation, and better service. 

Without the competitive constraint of 

head-to-head competition from FMI, 

Amsted has had and will continue to 

have the ability to exercise market 

power by raising prices, lowering 

product quality, lessening innovation, 

and decreasing the level of services. 

Entry into the design, manufacture, 

and sale of new or reconditioned EOCCs 

will not be timely, likely, or sufficient 

to counter the anticompetitive effects of 

the transaction. A new entrant to either 

market would require certifications and 

approvals from the Association of 

American Railroads (‘‘AAR’’), including 

facility certification and design 

certification for each EOCC model to be 

manufactured or reconditioned. 

Additionally, the AAR requires that a 

new entrant undergo a conditional 

approval period during which 

production is monitored and 

significantly limited. 

It is also essential that a new entrant 

into either the new or reconditioned 

EOCC markets have sufficient technical 

know-how regarding the product in 

order to design and sell EOCCs. Thus, 

a new entrant must invest in significant 

design and engineering expertise in 

order to create the necessary tooling and 

intellectual property required to 

successfully manufacture new or 

reconditioned EOCCs according to AAR 

standards and railroad customer 

requirements. 

A new entrant into the new or 

reconditioned EOCC markets also must 

produce EOCCs in sufficient quantities 

and with sufficiently consistent quality 

to assure railroad customers that the 

new and reconditioned EOCCs will 

provide the necessary level of 

cushioning required to protect sensitive 

cargo. Achieving this quality reputation 

requires an additional investment in 

time and money by any new entrant. 

Although the manufacturing 

processes for new and reconditioned 

EOCCs are similar, both require unique 

inputs that are not readily available in 

the marketplace. For example, the 

manufacture of new EOCCs requires the 

use of patented designs and proprietary 

molds that are not needed in the 

reconditioning process. Similarly, the 


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manufacture of reconditioned EOCCs 

requires the application of certain 

machining techniques and testing 

processes that are unique to the EOCC 

reconditioning market. 

For these reasons, entry by any firm 

into the new or reconditioned EOCC 

markets would not be timely, likely, or 

sufficient to counter anticompetitive 

price increases imposed by Amsted. 

III. Explanation of the Proposed Final 

Judgment 

Because the FMI business was 

discontinued as a result of the 

transaction and Amsted now has only 

one facility that manufactures EOCCs, 

the divestiture of a going concern in this 

case would be difficult and potentially 

disruptive to the railroad industry. 

Instead, the divestiture and license 

requirements of the proposed Final 

Judgment are designed to create an 

independent and economically viable 

competitor by providing to a new 

entrant the market-specific intellectual 

assets needed for successful 

competition. The proposed Final 

Judgment requires that Amsted divest 

these assets, without compensation, to a 

pre-approved acquirer operating in the 

railroad industry. Amsted must divest 

all of the acquired FMI intangible assets 

and all of the FMI tangible assets used 

for imparting the shape, form, or finish 

to EOCC components. The divestiture 

includes all trademarks, brands, 

certifications, patents, blueprints, 

drawings, castings, dies, molds, 

toolings, fixtures, specifications, quality 

assurance plans, manufacturing plans, 

and related financial data. 

The proposed Final Judgment also 

requires Amsted to provide to the 

acquirer a royalty-tree, perpetual license 

to all Amsted-generated intangible 

assets and a limited license to the use 

of all Amsted-generated casting patterns 

needed for the production of EOCC 

components. The license should 

effectively fill any intellectual property 

gaps in the FMI divestiture package and 

resolve questions concerning the 

completeness of the available FMI 

assets. The license includes all patents, 

blueprints, drawings, castings, dies, 

molds, toolings, fixtures, specifications, 

quality assurance plans, manufacturing 

plans, and product tracking information. 

Combined with readily available 

manufacturing equipment, these assets 

will provide the acquirer with 

immediate access to the technical knowhow required to make new and 

reconditioned EOCCs. The engineering 

information should accelerate the AAR 

certification process, while also 

providing customers with assurance that 

the designs used by the acquirer are 

field tested and historically successful. 

The proposed Final Judgment provides 

that for the divestiture to be approved, 

it must be demonstrated to the 

satisfaction of the United States, in its 

sole discretion, that the acquirer will 

enter the market to remedy the 

competitive harm alleged in the 

Complaint. The divestiture must be 

made to an acquirer that in the United 

States’ judgment has the intent and 

capability (including the necessary 

managerial, operational, technical, and 

financial capability) to compete 

effectively in the design, manufacture, 

and sale of EOCCs; the divestiture also 

must be accomplished in a manner that 

satisfies the United States, in its sole 

discretion, that none of the terms of any 

agreement between an acquirer and the 

defendant gives the defendant the 

ability unreasonably to raise the 

acquirer’s costs, reduce the acquirer’s 

efficiency, or otherwise interfere in the 

ability of the acquirer to compete 

effectively in the design, manufacture, 

and sale of EOCCs. The defendant must 

take all reasonable steps necessary to 

accomplish the divestiture quickly and 

must cooperate with the acquirer. 

The proposed Final Judgment requires 

the defendant, within sixty (60) days 

after the filing of the Complaint, or five 

(5) days after notice of the entry of the 

Final Judgment by the Court, whichever 

is later, (1) to divest the Divested Assets 

to the acquirer, and (2) to grant the 

Supplemental Asset License to the 

acquirer. The defendant agrees to use its 

best efforts to accomplish the license 

grant and divestiture expeditiously. 

In the event that the approved 

acquirer is unable or unwilling to 

receive the divested assets, the Court 

will appoint a trustee selected by the 

United States and approved by the 

Court to effect the divestiture of the 

assets to an alternative acquirer 

acceptable to the United States. Amsted 

will pay all costs and expenses of the 

trustee. The trustee’s commission will 

be structured so as to provide an 

incentive for the trustee based on the 

speed with which the divestiture is 

accomplished. After his or her 

appointment becomes effective, the 

trustee will file monthly reports with 

the Court and the United States setting 

forth his or her efforts to accomplish the 

divestiture. At the end of 60 days, if the 

divestiture has not been accomplished, 

the trustee and the United States will 

make recommendations to the Court, 

which shall enter such orders as 

appropriate, in order to carry out the 

purpose of the trust, including 

extending the trust or the term of the 

trustee’s appointment. 

The proposed Final Judgment requires 

Amsted to release all industry 

participants of restrictive covenants that 

might otherwise inhibit the acquirer’s 

access to employees, customers, or 

suppliers. Amsted must also release 

Progress Rail from an acquisition-related 

‘‘covenant not to compete’’ if the 

acquirer is unable to deliver its first 

manufactured or reconditioned unit 

within twelve months after the entry of 

the Final Judgment. 

Finally, the proposed Final Judgment 

prohibits Amsted from acquiring any 

assets of or any interest in the 

development, production, or sale of 

EOCCs in the United States if the value 

of such acquisition exceeds $1,000,000 

without first notifying the United States 

through procedures set out in the Final 

Judgment, unless the transaction is 

otherwise subject to the reporting and 

waiting period requirements of the HartScott-Rodino Antitrust Improvements 

Act. This notification requirement runs 

for a period of ten years. 

The provisions of the proposed Final 

Judgment will facilitate new entry in 

order to eliminate the anti competitive 

effects of the acquisition in the design, 

manufacture, and sale of EOCCs. 

IV. Remedies Available to Potential 

Private Litigants 

Section 4 of the Clayton Act (15 

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

has been injured as a result of conduct 

prohibited by the antitrust laws may 

bring suit in federal court to recover 

three times the damages the person has 

suffered, as well as costs and reasonable 

attorneys’ fees. Entry of the proposed 

Final Judgment will neither impair nor 

assist the bringing of any private 

antitrust damage action. Under the 

provisions of Section 5(a) of the Clayton 

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

Judgment has no prima facie effect in 

any subsequent private lawsuit that may 

be brought against the defendant. 

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 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. 


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4Cf. BNS, 858 F.2d at 463 (holding that the 

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

limited to approving or disapproving the consent 

decree’’); Gillette, 406 F. Supp. at 716 (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 person who wishes to comment 

should do so within sixty 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 Department of Justice, 

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: Maribeth Petrizzi, Chief, 

Litigation II Section, Antitrust Division, 

United States Department of Justice, 

1401 H Street, 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 

against the defendant. The United States 

could have commenced litigation and 

sought a judicial order requiring Amsted 

to recreate FMI as a separate business 

unit that could be divested as a going 

concern. This alternative would have 

substantially delayed relief while 

introducing a significant risk that the 

divestiture would be unsuccessful. This 

alternative may have also increased the 

potential for harm to the markets 

through supply disruption and a 

decrease in available capacity. The 

United States is satisfied that the 

divestiture and license described in the 

proposed Final Judgment will facilitate 

entry in order to recreate competition 

for the design, manufacture, and sale of 

EOCCs in the relevant markets 

identified by the United States, and thus 

would achieve substantially all of the 

relief that the United States would have 

obtained through litigation, but without 

the cost and risks associated with trial. 

VII. Standard of Review Under the 

APPA for the Proposed Final Judgment 

The APPA requires that proposed 

consent judgments in antitrust cases 

brought by the United States be subject 

to a sixty-day comment period, after 

which the Court shall determine 

whether entry of the proposed Final 

Judgment ‘‘is in the public interest.’’ 15 

U.S.C. 16(e)(1). In making that 

determination, the Court shall consider: 

(A) 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, 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). As the 

United States Court of Appeals for the 

District of Columbia Circuit has held, 

under the APPA a court considers, 

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 Corp., 56 F.3d 1448, 1458–62 

(D.C. Cir. 1995). 

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. 

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).4 In making 

its public interest determination, a 

district court must accord due respect to 

the government’s prediction as to the 

effect of proposed remedies, its 

perception of the market structure, and 

its views of the nature of the case. 

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

(D.D.C. 2003). 

Court approval of a final judgment 

requires a standard that is 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.’ ‘‘ 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). The Court ‘‘must 

accord deference to the government’s 

predications about the efficacy of its 

remedies, and may not require the 

remedies to perfectly match the alleged 

violations because this may only reflect 

underlying weaknesses in the 

government’s case or concessions made 

during negotiations.’’ United States v. 

SBC Commc’ns, Inc., Nos. 05–2102 and 

05–2103, 2007 WL 1020746, at *16 

(D.D.C. Mar. 29, 2007). 

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. 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. Id. at 1459–60. As this Court 

recently confirmed in SBC Commc’ns, 

courts ‘‘cannot look beyond the 

complaint in making the public interest 

determination unless the complaint is 

drafted so narrowly as to make a 


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mockery of judicial power.’’ SBC 

Commc’ns, at *14. 

In 2004, Congress amended the APPA 

to ensure that courts take into account 

the above-quoted list of relevant factors 

when making a public interest 

determination. Compare 15 U.S.C. 16(e) 

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

(substituting ‘‘shall’’ for ‘‘may’’ in 

directing relevant factors for court to 

consider and amending list of factors to 

focus on competitive considerations and 

to address potentially ambiguous 

judgment terms). These amendments, 

however, did not change the 

fundamental role of courts in reviewing 

proposed settlements. To the contrary, 

Congress made clear its intent to 

preserve the practical benefits of 

utilizing consent decrees in antitrust 

enforcement, adding the unambiguous 

instruction ‘‘[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 codified the intent of the 

original 1974 statute, expressed by 

Senator Tunney in the legislative 

history: ‘‘[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: 

[a]bsent a showing of corrupt failure of the 

government to discharge its duty, the Court, 

in making its public interest finding, should 

. . . carefully consider the explanations of 

the government in the competitive impact 

statement and its responses to comments in 

order to determine whether those 

explanations are reasonable under the 

circumstances. 

United States v. Mid-America Dairymen, Inc., 

1977–1 Trade Cas. (CCH) ¶ 61,508, at 71,980 

(W.D. Mo. 1977). 

This-Court recently examined the role of 

the district court in reviewing proposed final 

judgments in light of the 2004 amendments, 

confirming that the amendments ‘‘effected 

minimal changes[] and that this Court’s scope 

of review remains sharply proscribed by 

precedent and the nature of Tunney Act 

proceedings.’’ See United States v. SBC 

Commc’ns, Inc., Nos. 05–2102 and 05–2103, 

2007 WL 1020746, at *9 (D.D.C. Mar. 29, 

2007). This Court concluded that the 

amendments did not alter the articulation of 

the public interest standard in Microsoft. Id. 

at *15. 

VIII. Determinative Documents 

There are no determinative materials or 

documents within the meaning of the APPA 

that were considered by the United States in 

formulating the proposed Final Judgment. 

Dated: April 18, 2007. 

Respectfully submitted, 

/s/ lllllllllllllllll

C. Scott Hataway Bar No. 473942, 

U.S. Department of Justice, Antitrust 

Division, Lit II Section, 1401 H Street 

NW., Washington, DC 20530 202–514–

8380. 

[FR Doc. 07–2087 Filed 4–27–07; 8:45am] 

BILLING CODE 4410–11–M 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

Importer of Controlled Substances 

Notice of Application 

This is notice that on October 18, 

2006, Noramco Inc., 500 Swedes 

Landing Road, Wilmington, Delaware 

19801, made application by renewal to 

the Drug Enforcement Administration 

(DEA) for registration as an importer of 

the basic classes of controlled 

substances listed in schedule II: 

Drug Schedule 

Raw Opium (9600) ....................... II 

Concentrate of Poppy Straw 

(9670).

II 

The company plans to import the 

listed controlled substances to 

manufacture other controlled 

substances. 

As noted in a previous notice 

published in the Federal Register on 

September 23, 1975, (40 FR 43745), all 

applicants for registration to import a 

basic class of any controlled substances 

in schedule I or II are, and will continue 

to be, required to demonstrate to the 

Deputy Assistant Administrator, Office 

of Diversion Control, Drug Enforcement 

Administration, that the requirements 

for such registration pursuant to 21 

U.S.C. 958(a), 21 U.S.C. 823(a), and 21 

CFR 1301.34(b), (c), (d), (e) and (f) are 

satisfied. 

Dated: April 17, 2007. 

Joseph T. Rannazzisi, 

Deputy Assistant Administrator, Office of 

Diversion Control Drug Enforcement 

Administration. 

[FR Doc. E7–8132 Filed 4–27–07; 8:45 am] 

BILLING CODE 4410–09–P 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

Manufacturer of Controlled 

Substances Notice of Application 

Pursuant to § 1301.33(a) of Title 21 of 

the Code of Federal Regulations (CFR), 

this is notice that on March 1, 2007, 

Organichem Corporation, 33 Riverside 

Avenue, Rensselaer, New York 12144, 

made application by letter to the Drug 

Enforcement Administration (DEA) to 

be registered as a bulk manufacturer of 

Oxymorphone (9652), a basic class of 

controlled substance listed in schedule 

II. 

The company plans on manufacturing 

the listed controlled substance in bulk 

for sale to its customers. 

Any other such applicant and any 

person who is presently registered with 

DEA to manufacture such a substance 

may file comments or objections to the 

issuance of the proposed registration 

pursuant to 21 CFR 1301.33(a). 

Any such written comments or 

objections being sent via regular mail 

should be addressed, in quintuplicate, 

to the Drug Enforcement 

Administration, Office of Diversion 

Control, Attention: DEA Federal 

Register Representative (ODL), 

Washington, DC 20537, or any being 

sent via express mail should be sent to 

Drug Enforcement Administration, 

Office of Diversion Control, Federal 

Register Representative (ODL), 2401 

Jefferson-Davis Highway, Alexandria, 

Virginia 22301; and must be filed no 

later than June 29, 2007. 

Dated: April 17, 2007. 

Joseph T. Rannazzisi, 

Deputy Assistant Administrator, Office of 

Diversion Control Drug Enforcement 

Administration. 

[FR Doc. E7–8131 Filed 4–27–07; 8:45 am] 

BILLING CODE 4410–09–P 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

Importer of Controlled Substances 

Notice of Application 

This is notice that on January 26, 

2007, Stepan Company, Natural 

Products Department, 100 W. Hunter 

Avenue, Maywood, New Jersey 07607, 

made application by renewal to the 

Drug Enforcement Administration 

(DEA) for registration as an importer of 

Coca Leaves (9040), a basic class of 

controlled substance listed in schedule 

II. 

The company plans to import the 

listed controlled substance for the 

manufacture of a bulk controlled 

substance for distribution to its 

customer. 

As noted in a previous notice 

published in the Federal Register on 

September 23, 1975, (40 FR 43745), all 

applicants for registration to import a 

basic class of any controlled substances 

in schedule I or II are, and will continue 

to be, required to demonstrate to the 


rwilkins on PROD1PC63 with NOTICES