1

 All text in bold and brackets is Confidential subject to the March 5, 2002 Protective Order

entered in this case. Pursuant to FTC Rule of Practice 3.45(e), 16 C.F.R. § 3.45(e), a list of the names

and addresses of persons who should be notified of the Commission’s intent to disclose in a final

decision any of the confidential information contained in this motion is attached as Exhibit E.

UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

__________________________________________

)

In the Matter of )

)

CHICAGO BRIDGE & IRON COMPANY N.V. )

)

a foreign corporation, ) PUBLIC RECORD VERSION1 

) 

CHICAGO BRIDGE & IRON COMPANY )

)

a corporation, )

 ) Docket No. 9300

and )

)

PITT-DES MOINES, INC. )

)

a corporation. )

__________________________________________)

To: The Honorable D. Michael Chappell

Administrative Law Judge

COMPLAINT COUNSEL’S OPPOSITION TO RESPONDENTS’

MOTION TO STRIKE

Pursuant to Section 3.22 (c) of the Federal Trade Commission’s Rules of Practice (“FTC

Rules”), 16 C.F.R. 3.22(c), Complaint Counsel file this opposition to Respondents’ Motion to Strike

three witnesses from Complaint Counsel’s Final Proposed Witness List. For the reasons set forth

herein, there is good cause why Complaint Counsel should be permitted to present the testimony of

these three CB&I customer witnesses who, only through discovery, Complaint Counsel learned
2

 CX 1548, Declaration of [ ], Exhibit A hereto. The applicable statute provides: 

“Wherever, under any law of the United States or under any rule, regulation, order, or requirement

made pursuant to law, any matter is required or permitted to be supported, evidenced, established, or

proved by the sworn declaration, verification, certificate, statement, oath, or affidavit, in writing of the

person making the same (other than a deposition, or an oath of office, or an oath required to be taken

before a specified official other than a notary public), such matter may, with like force and effect, be

supported, evidenced, established, or proved by the unsworn declaration, certificate, verification, or

statement, in writing of such person which is subscribed by him, as true under penalty of perjury, and

dated, in substantially the following form: (1) If executed without the United States: ''I declare (or

certify, verify, or state) under penalty of perjury under the laws of the United States of America that the

foregoing is true and correct. Executed on (date). (Signature)''[;] (2) If executed within the United

States, its territories, possessions, or commonwealths: ''I declare (or certify, verify, or state) under

penalty of perjury that the foregoing is true and correct. Executed on (date). (Signature)'' 28 U.S.C.

§ 1746. 

-2-

are able to provide testimony important to this proceeding. Two of the

witnesses are located in Canada. One of the Canadian witnesses has submitted a declaration executed

in accordance with 28 U.S.C. § 1746.2 Upon receipt of the September 23, 2002 executed

declaration, Complaint Counsel immediately provided it to Respondents on September 24, 2002. 

Complaint Counsel are continuing our efforts to secure a declaration from the other Canadian witness

and hope to receive one shortly. In the event we obtain such a declaration, we will promptly provide it

to Respondents. Because these witnesses are located outside the United States, Complaint Counsel

submit that there is good cause for receiving their testimony by declaration. Further, because neither of

these declarations had been received by Complaint Counsel until after we submitted Complaint

Counsel’s Exhibit List, there is good cause for allowing addition of these declarations as exhibits. As

noted infra, Respondents have likewise included the declaration of a foreign declarant, [ 

 ], as one of their proposed exhibits. DX 202. 

Respondents argue that the three additional witnesses at issue should be struck because they
-3-

were named after the close of discovery on September 6, 2002. As explained below, Complaint

Counsel became aware of the important potential testimony of these individuals only recently through

discovery, including voluntary discovery of third parties, and identified these individuals to Respondent

as soon as we reached the opinion that we would likely include these witnesses in the final witness list.

The testimony of each of these three witnesses is highly relevant to this case and rebuts

arguments advanced by Respondents’ economic expert. See Expert Report of Barry C. Harris. 

Respondents will not be prejudiced by the inclusion of these three witnesses. We understand that

Respondents have already initiated contact with the witnesses. Respondents state that they have

known about the proposed Canadian witnesses since September 13. They have been free to interview

these foreign witnesses and to seek counter-declarations from them. Respondents have known since

September 5 that Complaint Counsel planned to include [ ] on the September 16 witness list and

have had ample opportunity to interview or depose him.

Moreover, Respondents’ claim of prejudice is unfounded because Respondents concede that

anyone knowledgeable regarding the LNG tank industry should have known long ago that these

witnesses and the companies they represent possessed knowledge relevant to this case. Respondents’

Motion to Strike at 4-7. Further, Respondents’ assertion that they had no opportunity to interview or

depose these individuals until they appeared on Complaint Counsel’s witness list is refuted by the

numerous third-party depositions Respondents have noticed of persons who had not, at the time, been

identified as witnesses for Complaint Counsel. Respondents are the leading firms in the markets alleged

in the Complaint and have had ongoing business dealings with each of the witnesses or the companies

they represent, who are customers or prospective customers of CB&I. Indeed, Respondents
3

 Respondents’ cover letters are attached hereto as Exhibit B.

4

 Respondents’ cover letters are attached hereto as Exhibit C.

5

 October 2, 2002, telephone call from Jeffrey Leon to Steven Wilensky.

-4-

acknowledge that they asserted in their July 9, 2001, White Paper that the experiences of two of these

companies are relevant to analysis of the competitive effects of the acquisition. Respondents’ Motion to

Strike at 6-7.

 As noted above, Respondents have not limited their third-party discovery to persons identified

on Complaint Counsel’s witness lists. Prior to receipt of Complaint Counsel’s Initial Witness List on

April 22, 2002, Respondents issued 29 subpoenas for third-party depositions.3 Between April 23 and

May 23, Respondents issued thirteen additional subpoenas ad testificandum to third-party companies4

who were not on Complaint Counsel’s Initial Witness List. Further, notwithstanding the May 7, 2002,

deadline for Respondents to disclose their expert witnesses, Respondents informed Complaint Counsel,

for the first time by telephone late on October 2, 2002, that they may add an unnamed expert witness.5

Respondents have ably demonstrated their ability to conduct voluntary third-party discovery, of

persons within as well as outside the United States, and to depose witnesses they believe may have

knowledge relevant to this case. They did not need to wait until Complaint Counsel completed our

allowed discovery and identified supplemental witnesses based theron, in order to conduct their own

third-party discovery.
6

 As explained, infra, earlier in this litigation, Respondents requested this Court to authorize the

issuance of several subpoenas duces tecum and ad testificandum to foreign entities. By order of April

18, 2002, Judge Timony denied Respondents’ motion and directed the parties to initially seek foreign

discovery on a voluntary basis. Complaint Counsel and Respondents have each pursued voluntary

discovery of foreign witnesses in accordance with that Order. One of the Canadian witnesses at issue

indicated that he would not be amenable to testifying live at trial, but has submitted a declaration. CX

1548 (Exhibit A). The other Canadian witness has indicated a willingness to submit a declaration, but

has not yet done so, and it is unclear at this point whether this witness would be willing to testify live at

trial. Complaint Counsel are attempting, at this time, to secure voluntarily the testimony of this foreign

witness in whatever form he is willing to provide such testimony.

-5-

ARGUMENT

Complaint Counsel’s Final Proposed Witness List included three individuals who had not been

listed on earlier witness lists because Complaint Counsel had no reason to expect that these individuals

would likely be witnesses for Complaint Counsel in this matter. Complaint Counsel have not withheld

from Respondents the identity of any proposed witness. The witnesses challenged in Respondents’

motion are three among 34 fact witnesses identified by Complaint Counsel. 

Two of the recently added witnesses are located in Canada. For the reasons explained in the

Court’s April 18, 2002 Order, foreign discovery must be conducted voluntarily, in the first instance,

and requires flexibility regarding the form in which voluntary third-party testimony or statements are to

be accepted. Order Denying Respondents’ Motion for Issuance of Subpoenas at 6-7. Complaint

Counsel have offered the testimony of one of these witnesses by declaration (CX 1548 (Exhibit A))

and are attempting to obtain voluntarily the testimony of the other foreign witness either live or by

declaration.6 Complaint Counsel intend to offer the live testimony of the third witness, [ ], who is

located in the United States. In the course of discovery, information obtained from one witness, or

from documents secured through discovery, prompts a party to conduct further investigation, which
-6-

leads to identification of potential witnesses. Complaint Counsel have, in good faith, followed this

approach in preparing Complaint Counsel’s case and in rounding out Complaint Counsel’s witness list. 

Such a result is certainly foreseeable in a case such as this, where some 50 depositions and many thirdparty interviews have been conducted by the parties. 

 Respondents will not be prejudiced by the inclusion of these witnesses in Complaint Counsel’s

Final Witness List. Complaint Counsel identified each of the three individuals to Respondents as soon

as Complaint Counsel determined that we would likely list them as a witness. Although discovery

formally ended on September 6, 2002, depositions of witnesses who were scheduled prior to that time

are continuing. On September 23 and 24, Complaint Counsel took the depositions of two party

witnesses pursuant to stipulation between Complaint Counsel and Respondents. See Exhibit F attached

hereto. Respondents deposed a third-party witness on September 25, and on October 1, the parties

completed the deposition of one of Respondents’ third-party witnesses, whose previous deposition had

been cut short by counsel for the third party. Respondents have been free, and remain free, to seek to

interview each of the witnesses, to seek to depose the United States witness and to attempt to secure

voluntary declarations from the Canadian witnesses. 

A. Respondents’ Failure to Comply, on a Timely Basis, with the Court’s

Discovery Order Has Prejudiced Complaint Counsel

The erroneous premise of Respondents’ Motion to Strike is that discovery is limited to

deposing or cross examining witnesses listed by opposing counsel. Complaint Counsel have

appropriately used the allowed discovery period to identify, locate and interview persons who may be

able to provide information important to this case. Commission Rule 3.31(c)(1) makes clear that
7

 Respondents’ failure to produce these files, despite this Court’s July 1 Order to complete, by

August 6, production of documents responsive to Complaint Counsel’s document request, is the

subject of Complaint Counsel’s September 26 Motion to Compel.

-7-

permissible discovery includes identifying and locating “persons having any knowledge of any

discoverable matters.” 16 C.F.R. § 3.31(c)(2). 

Complaint Counsel timely filed our Final Proposed Witness List on September 16, 2002. The

trial date and the dates set for filing of final witness lists had been extended by two months upon the

motion of Respondents. Respondents’ Motion for a Sixty-Day Extension of Time, June 14, 2002. In

addition to other discovery and trial preparation efforts, Complaint Counsel and Respondents used the

additional time afforded by this extension to identify, locate, and interview persons who might be able to

provide valuable testimony. Among the sources of such information were Respondents’ e-mail files,

which include communications between Respondents and their customers.

 However, Complaint Counsel have been hampered in our efforts to discover potential

witnesses by Respondents’ failure timely to comply with Complaint Counsel’s document discovery. In

granting Respondent’s Motion for an Extension of Time, Administrative Law Judge Timony directed

that “CB&I will produce documents responsive to the Complaint Counsel’s document requests on a

rolling basis beginning on July 12, 2002 and ending no later than August 6, 2002.” Order of July 1,

2002. Nevertheless, Respondents delayed, until August 27, production of e-mail files from their sales

and marketing department, and respondents have still not produced the e-mail files of each of their

testifying employee witnesses.7 These e-mail files are an important means of discovering persons who

may provide valuable witness testimony, and Respondents’ failure timely to complete production of
-8-

these files has prejudiced Complaint Counsel. 

As discussed, infra, Complaint Counsel promptly reviewed the August 27 document

production and discovered two July 17, 2002 e-mail communications from [ ] to CB&I in

which [ ] observed [ 

 ] CX 786 (Exhibit D hereto). These e-mail communications alerted

Complaint Counsel that [ ] is knowledgeable concerning current competitive conditions in the

LNG tank market and prompted Complaint Counsel to contact and interview [ ], an interview

which was delayed by the Labor Day holiday weekend. Based on that interview, Complaint Counsel

informed Respondents on September 5 that we expected to call [ ] as a witness.

B. Respondents Have Not Been Prevented from Obtaining Voluntary

Declarations from Foreign Witnesses

Respondents assert that they would be prejudiced if affidavits of the two Canadian witnesses

are admitted because they were denied the opportunity to take foreign discovery by this Court’s Order

of April 18, 2002. Respondents’ Motion to Strike at 4. However, Respondents fail to acknowledge

the Court’s directive to seek, in the first instance, voluntary statements from foreign witnesses, although

subsequent to entry of the Order Respondents have done just that. Respondents themselves have

submitted as an exhibit the June 4, 2002, declaration of a foreign witness, [ ] DX 202. 

Respondents’ motion for issuance of subpoenas to be served in a foreign country was denied,

without prejudice, because Respondents had failed to satisfy any of the requirements of FTC Rule

3.36(b) for issuance of such subpoenas. Order Denying Respondents’ Motion for Issuance of

Subpoenas, April 18, 2002. Among numerous deficiencies in Respondents’ motion, this Court found
-9-

that “Respondents have not demonstrated that they cannot obtain the requested evidence voluntarily

from the foreign companies.” Order Denying Respondents’ Motion for Issuance of Subpoenas at 6,

April 18, 2002. Specifically, this Court noted: “Respondents have made no showing in their motion that

they have contacted the foreign companies to determine whether they will voluntarily provide

documents, statements, or deposition testimony.” Id. at 6-7, April 18, 2002. Rule 3.36(b)(3) requires

Respondents to make a specific showing that “[t]he information or material sought cannot reasonably

be obtained by other means.” The Federal Register notice accompanying the publication of the rule

explains that:

[foreign] discovery should only occur if a judge determines that . . . other means of

obtaining the information (such as domestic discovery or voluntary arrangements)

have been exhausted or are not available.

66 Fed. Reg. 17623, April 3, 2001 (emphasis added); see Order Denying Respondents’ Motion for

Issuance of Subpoenas at 6. 

Nevertheless, ignoring the guidance of the Commission and of this Court regarding the

appropriate and preferred procedure for securing and presenting evidence from foreign witnesses,

Respondents instead seek to block presentation of testimony or sworn statements of foreign witnesses

offered by Complaint Counsel in accordance with this Court’s directive that the parties may

appropriately seek to obtain voluntary statements of foreign witnesses. Turning the Commission’s April

3, 2001, statement on its head, Respondents now argue that voluntarily submitted testimony or sworn

statements of foreign witnesses should not be considered by the Court because such witnesses may not

be subject to subpoena.

C. There Is Good Cause for Allowing Complaint Counsel to Include the
-10-

Three Witnesses

The testimony to be presented by these three witnesses is highly relevant to this case. [ 

] was project manager for an LNG peak shaving plant for which foreign competitors submitted noncompetitive bids and has recently turned to CB&I to build an additional LNG tank at the site. His

recent experience sheds light on competition since the acquisition. [ ], of Canada,

works for a company that received bids from CB&I, PDM, and foreign companies for an LNG peak

shaving plant. He is expected to testify that the bids of the foreign competitors were higher than the

bids from the U.S. firms, CB&I and PDM. 

[ ], of Canada, is a consultant who is advising a U.S. firm on the purchase of an

LNG tank for construction in the United States. CX 1548 ¶ 6 (Exhibit A). He testifies that in April

2002, he requested bids for the project. CX 1548 ¶ 10 (Exhibit A). The subsequent responses to

these bids could not have been known to Complaint Counsel when we submitted our Initial Witness

List on April 22, 2002, or our Revised Witness List on May 28, 2002. Although he sought foreign

constructors to bid for this project, each declined to submit a bid. CX 1548 ¶¶ 12, 13 (Exhibit A). He

found the bid submitted by CB&I on this project to be high relative to comparable prices he has

observed in the past and testifies that based on his experience in observing competition between CB&I

and PDM prior to the acquisition, he believes that the elimination of competition between CB&I and

PDM has adversely affected the price he was able to obtain from CB&I. CX 1548 ¶¶ 11, 16 (Exhibit

A).

The testimony of each of the witnesses is material and important to confronting Respondents’

asserted defense that competition in the United States by foreign firms has offset any anticompetitive
-11-

effects of the acquisition in the LNG tank market. See Expert Report of Barry C. Harris. The

relevance of the two Canadian witnesses is particularly high. Because there are few bid contests

between CB&I or PDM and foreign-based suppliers for North American LNG tank projects, the

information provided by the two Canadian witnesses will provide the Court with a substantially more

informed basis for assessing Respondent’s defense. Admitting evidence relating to the two projects in

which the Canadian witnesses sought competitive bids from CB&I and others will serve the Court’s

“interest of having all of the relevant evidence before it . . . .” Order of June 18, 2002.

Respondents argue that Complaint Counsel were aware, or should have been aware, of the

existence of each of these three witnesses earlier in the litigation and consequently should have named

them as witnesses earlier. Respondents’ Motion to Strike at 4-7. For example, Respondents suggest

that because [ ] was identified in documents provided by Respondents in April 2002,

Complaint Counsel should have included [ ] on the earlier witness lists. Respondents’ Motion to

Strike at 7. The document cited by Respondents for this proposition is a 1995 construction schedule

for an LNG storage tank and is devoid of any information that would suggest that the persons identified

in the document should be named as witnesses by Complaint Counsel. Respondents’ Motion to Strike

Exhibit E. Among the volumes of documents that have been submitted in this case, it is likely that

thousands of individuals with some connection to the products at issue are mentioned somewhere. 

Complaint Counsel cannot be expected to list as a potential witness every person mentioned in

Respondents’ documents, and no prejudice is imposed on Respondents as a result of Complaint

Counsel not having done so. 

In pursuing discovery, Complaint Counsel, as any party, must respond to specific leads that
-12-

develop over time. Respondents, who operate in this business on a daily business, are more likely than

Complaint Counsel to have previously been aware of the existence of these three witnesses and the

nature of any potential testimony they could provide, and consequently are not prejudiced by their

inclusion on Complaint Counsel’s witness list.

It is difficult to understand how Respondents can claim prejudice while at the same time

admonishing Complaint Counsel for failing to recognize years ago the obvious significance of these

potential witnesses (Respondents’ Motion to Strike at 6 (“Complaint Counsel have known about this

project for years.”)) and acknowledging Respondents’ own recitation, in their pre-Complaint white

papers, of the significance of these third parties to analysis of the competitive effects of the acquisition. 

Respondents’ Motion to Strike at 6-7. Respondents consummated the acquisition on February 7,

2001, prior to responding to the FTC’s outstanding investigational subpoenas and civil investigative

demands; the Complaint in this matter issued on October 25, 2001; and Respondents filed their

Answers to the Complaint on February 4, 2002. While Respondents have known for years about their

dealings with the companies the three witnesses represent, Complaint Counsel have had to play catch

up through discovery in this action. 

The cases cited by Respondents for the proposition that witnesses named after the close of

discovery should be struck are clearly distinguishable from the present case. In Geiserman v.

MacDonald, 893 F.2d 787 (5th Cir. 1990), the court struck an expert witness after plaintiff missed two

deadlines relating to the expert’s designation. In upholding the lower court, the court found plaintiff’s
8

 “The reasons offered by Geiserman for this failure to timely designate are weak, at best. He

asserts that the pretrial order did not specify a deadline date for designation. This is incredible, because

the scheduling order and local rule 8.1(c) plainly impose a deadline to designate his expert witnesses at

least 90 days before trial. One does not need a legal degree to count back 90 days from the scheduled

trial date of December 5, which the pretrial order contained. The second excuse, that the omission

resulted from a scheduling mistake in counsel’s office, is not the type of satisfactory explanation for

which relief may be granted.” Geiserman v. MacDonald, 893 F.2d at 791. 

-13-

explanations of its tardiness trivial.8 The reasons why Complaint Counsel, in this action, named the

three witnesses when we did are significant and described in detail below. In Koch v. Koch Indus.,

179 F.R.D. 606, 608-09 (D. Kan. 1998), plaintiff added seven new witnesses ten days before the

commencement of trial and following entry of the pretrial order in a case that had been in litigation for

13 years. In Cox v. Consolidated Rail Corp., Civ. A. Nos. 83-0514, 85-0845, 1987 WL 8728, at

*1-*2 (D.D.C. Mar. 12, 1987), of “the twenty witnesses (excluding the plaintiffs themselves)

designated to testify . . . only six were identified prior to the close of discovery.” In the present

litigation, Complaint Counsel have recently included, in a list of 34 fact witnesses, three fact witnesses

whose testimony is highly material to our central claim and to Respondents’ defense. These

circumstances stand in stark contrast to Cox, in which the court stated, “The instant case does not

involve a situation where plaintiff has discovered one or two new witnesses who are able to provide

additional support to its central claim.” Cox v. Consolidated Rail Corp., *1-*2 (D.D.C. Mar. 12,

1987).

Finally, Respondents have yet to complete their own discovery obligations. See Complaint

Counsel’s Motion to Compel. It is ironic for Respondents to argue that they are prejudiced by

Complaint Counsel naming three additional witnesses just prior to or after the close of discovery, when
-14-

Respondents are almost two months delinquent in producing responsive e-mails pertaining to each of

the witnesses included in their Final Proposed Witness List, which e-mail is a vital source from which

Complaint Counsel may ascertain the identity of potential witnesses.

The circumstances that led to the listing of each of three witnesses on Complaint Counsel’s

Final Proposed Witness List are discussed below.

A. [ ]

Respondents argue that Complaint Counsel should have learned about the existence of [ 

 ] earlier because he has been involved in the LNG industry for years. Respondents’ Motion to

Strike at 4. However, although Respondents identified, in their initial disclosures, on February 23,

2001, 108 individuals as having discoverable information relevant to the allegations of the Complaint,

they failed to disclose that [ ] had information relevant to this case. 

At the end of July 2002, based on a telephone conversation with a third party, Complaint

Counsel first became aware of the existence of [ ]. [ 

 ], a Canadian national, is employed as a consultant for [ ], which

is investigating the purchase of an LNG tank. CB&I recently submitted a bid for the project, and [ 

 ] contacted two foreign LNG tank competitors about constructing the project. On July 26,

2002, Complaint Counsel first interviewed [ ] by telephone. [ ] referred

Complaint Counsel to his client, [ ], the ultimate purchaser

of the tank who is located in the United States. After interviewing [ ], Complaint

Counsel notified Respondents that we would call [ ] as a witness. However, Complaint

Counsel learned that [ ] had greater knowledge relating to efforts to secure competing bids
9

 Respondents suggest that Complaint Counsel should have informed Respondents earlier that

we were seeking an affidavit from [ ]. Respondents’ Motion to Strike at 4 n.3. There has

never been a requirement in this litigation that parties notify each other that they are seeking affidavits

from a potential witness, or that they submit to each other draft affidavits sent to third parties prior to

signature, and Respondents have not provided such disclosures to Complaint Counsel. 

-15-

for the LNG project. Therefore, Complaint Counsel asked [ ] for a declaration for use in

conjunction with [ ] testimony. 

Obtaining a declaration from [ ] was a time-consuming and sensitive process. 

Because [ ] is located in Canada, Complaint Counsel had to first notify Canadian authorities,

through the International Division of the FTC’s Bureau of Competition, of Complaint Counsel’s

request. Because he is a Canadian national, Complaint Counsel could not compel [ ] to

testify, and his declaration is purely voluntary.9 Complaint Counsel and [ ] had

several telephone conversations during August and September, interrupted by [ ]’s

vacation, and leading to his eventual execution of the declaration on September 23, 2002. Complaint

Counsel faxed this declaration to Respondents immediately upon receiving it on September 24, 2002.

Respondents incorrectly characterize [ ]’s declaration as consisting of hearsay. 

Respondents Motion at 4. [ ] has personal knowledge of the subjects in his declaration. [ 

 ] has extensive experience in the LNG industry and had been retained by [ 

 ] to advise that company on the purchase of an LNG tank in Alaska. CX 1548

¶¶ 1, 8 (Exhibit A). Of the sixteen substantive paragraphs contained in the declaration, Complaint

Counsel can discern only two, ¶¶ 12 and 13, that arguably contain hearsay statements. In these

paragraphs, [ ] recounts first hand his conversations with two foreign LNG tank
10 One of the individuals referred to in these paragraphs, [ ], is a witness for

Complaint Counsel and can corroborate [ ] statements.

11 [ ] acquired [ ] on March 14, 2002.

-16-

constructors. [ ] testimony on this subject is reliable evidence that the statements were

made.10

 B. [ ]

In a conversation with a third-party witness in early September 2002, the third party informed

Complaint Counsel that during the 1998 bid contest for an LNG tank peak-shaving plant, in southern

British Columbia for [ ], two foreign LNG tank constructors submitted bids

that were higher than the bids submitted by CB&I and PDM. Complaint Counsel contacted counsel

for [ ]

11 on September 11, 2002, to schedule a telephone interview with an employee

knowledgeable regarding the bids submitted in 1998 for the LNG tank. An interview was conducted

on September 13th with [ ], who [ ] designated as a knowledgeable

employee. Because [ ] is a Canadian national, Complaint Counsel notified the FTC’s

International Division of our intention to ask [ ] for an affidavit. As required by comity

agreements, the International Division notified Canadian authorities of Complaint Counsel’s request for

a declaration. [ ] has expressed a willingness to provide a declaration describing the

1998 bid contest for the LNG tank. However, due to his vacation and need to search for the relevant

bid documents in closed files, [ ] has not yet provided Complaint Counsel with an executed

declaration. As soon as Complaint Counsel receives a declaration from [ ], we will produce

it to Respondents.
-17-

While now claiming prejudice, Respondents themselves raised the materiality of the [ 

 ] LNG peak shaving project, which they concede that they noted in their July 9, 2001, White

Paper to the Commission. However, Respondents nevertheless failed to identify in their Initial

Disclosures either [ ] or any individuals from [ ] as having knowledge

relevant to the Complaint or Respondents’ Answers. Moreover, Respondents failed to disclose, in

their white paper, that the foreign bidders had submitted higher bids than CB&I. Therefore, Complaint

Counsel had no reason to look to [ ] for a fact witness. Respondents revealed, in

their white paper, only part of the story regarding bidding for the project. It was only through

Complaint Counsel’s third-party voluntary discovery efforts that Complaint Counsel discovered the

significance of [ ]’s potential testimony. Yet, Respondents now claim prejudice by

Complaint Counsel including a witness from [ ], who Complaint Counsel have

identified through our own discovery efforts. 

C. [ ]

[ ] is an engineer with [ 

 ], a municipal utility servicing the city of [ ]. In 1994, [ 

 ] put an LNG peak shaving plant out for bid. CB&I, PDM, and two groups including foreign LNG

tank constructors submitted bids for the project; CB&I won the project. The bids from the foreign

tank constructors were substantially higher than the bids submitted by either CB&I or PDM. The

circumstances surrounding this project are consequently highly relevant to this case.

Complaint Counsel have talked previously with representatives of [ ] during this litigation. 

However, Complaint Counsel’s contacts have been with personnel other than [ ], and none of
12 Respondent apparently chose not to include this affidavit as part of Respondents’ Final

Exhibit List. Complaint Counsel has included it as CX 20.

-18-

these contacts indicated that [ ] might have information material to the litigation. Respondents

have apparently been in contact with [ ] and indeed, earlier in this case, submitted an affidavit

from a representative of the company, [ ] - again an individual other than [ ].12 CX

20. 

On August 26, 2002, Respondents submitted to Complaint Counsel a box of documents,

including two July 17, 2002, e-mail communications from [ ] to an employee of CB&I, relating

to negotiations between [ ] and CB&I to add an additional LNG tank at the company’s site. In

the e-mail correspondence, [ ] notes as common knowledge that CBI/PDM is the only qualified

US-based firm capable of executing the project sought by [ ]. CX 786 (Exhibit D). Alerted to the

fact that he may have information material to the case, Complaint Counsel tried to contact [ ],

but were unable to interview him until after the Labor Day weekend. After interviewing [ ],

Complaint Counsel determined that he possesses important information relevant to this case. On

September 5, 2002, Complaint Counsel informed Respondent that we expected to place [ ] on

Complaint Counsel’s Final Proposed Witness List.

Respondents are in no way prejudiced by Complaint Counsel’s decision, prior to the close of

discovery, to include [ ] on Complaint Counsel’s Final Witness List. Rather it is Complaint

Counsel who have been prejudiced by Respondents’ failure timely to provide material and recent email communications between CB&I and its customers including [ ]. Respondents have long

been aware that [ ] had discoverable information relevant to the allegations of the Complaint. 
-19-

Indeed, respondents so stated in their initial disclosures on February 23, 2001. Respondents’ Rule

3.31(b) Initial Disclosures at 2, 4. Respondents’ acknowledgment, in their initial disclosure, that they

are aware of over 100 individuals having discoverable information does not obligate Complaint Counsel

to list each of those individuals on Complaint Counsel’s initial witness lists. As soon as Complaint

Counsel reasonably expected that [ ] may be called as a witness Complaint Counsel so notified

Respondents.

Further, Respondents acknowledge that they asserted in their July 9, 2001 White Paper that the

experiences of [ ] are relevant to analysis of the competitive effects of the acquisition. 

Respondents’ Motion to Strike at 6-7. Respondents have had ample opportunity to interview or

depose an individual long known by them to possess relevant information. Respondents make no

representation in their motion that they have not, in fact, already interviewed [ ] or others at [ 

 ] and perhaps realizing that their likely testimony would not be helpful to Respondents’defense, elected

not to include them in their witness list. 

CONCLUSION

The relevance of the testimony of the three witnesses is high and the burden imposed upon

Respondents by their addition to Complaint Counsel’s Final Proposed Exhibit List is low. Complaint

Counsel respectfully requests that this Court deny Respondents’ Motion to Strike. For the reasons set

forth herein, there is good cause why Complaint Counsel should be permitted to present the testimony

of these three witnesses who Complaint Counsel learned, through discovery, are able to provide

testimony important to this proceeding. 

Because two of the witnesses are located outside the United States, there is good cause for
-20-

receiving their testimony by declaration. Further, because neither of these declarations had been

received by Complaint Counsel until after submission of Complaint Counsel’s Exhibit List, there is good

cause for allowing addition of these declarations as exhibits.

Respectfully submitted,

_______________________________

Steven L. Wilensky

Federal Trade Commission

601 New Jersey Avenue, N.W.

Washington D.C. 20580

(202) 326-2650

Counsel Supporting the Complaint

Dated: October 3, 2002
UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

__________________________________________

)

In the Matter of )

)

CHICAGO BRIDGE & IRON COMPANY N.V. )

)

a foreign corporation, )

)

CHICAGO BRIDGE & IRON COMPANY )

)

a corporation, )

 ) Docket No. 9300

and )

)

PITT-DES MOINES, INC. )

)

a corporation. )

__________________________________________)

ORDER

On September 26, 2002, Respondents filed a Motion to Strike three witnesses identified on

Complaint Counsel’s Final Witness List. Having considered Respondents’ Motion and Complaint

Counsel’s Opposition thereto the Court finds that Complaint Counsel have shown good cause for

inclusion of the three witnesses on their final witness list. The relevance of the testimony of the three

proposed witnesses is high and the burden imposed upon Respondents by their addition to Complaint

Counsel’s Final Proposed Exhibit List is low. 

The Court further finds, in accordance with this Court’s prior ruling regarding foreign discovery,

that Complaint Counsel have shown good cause for acceptance by the Court of reliable, relevant and

material testimony of foreign witnesses submitted voluntarily in the form of declarations conforming to
-2-

the requirements of 28 U.S.C. § 1746. Accordingly,

IT IS HEREBY ORDERED that Respondents’ Motion to Strike is denied in its entirety. 

IT IS FURTHER ORDERED that Complaint Counsel may present the testimony of the two

foreign witnesses by declaration.

IT IS FURTHER ORDERED that Respondents may interview or depose the witness located in

the United States at such time and place as the witness may agree. Respondents may interview and

may seek voluntary declarations from the two foreign witnesses as those witnesses may agree.

ORDERED 

_____________________

D. Michael Chappell

Administrative Law Judge

Date: October ___, 2002
CERTIFICATE OF SERVICE

I hereby certify that I caused a Public Record copy of Complaint Counsel’s Opposition to

Respondents’ Motion to Strike to be delivered by hand to

The Honorable D. Michael Chappell

Federal Trade Commission

H-104

6

th and Pennsylvania Ave. N.W.

Washington D.C. 20580

Administrative Law Judge

and by facsimile and by first-class mail to:

Jeffrey A. Leon

Duane M. Kelley

Winston & Strawn

315 W. Wacker Drive

Chicago, IL 60601-9703

(312) 558-5600

Counsel for Respondents Chicago Bridge & Iron Company

N.V. and Pitt-Des Moines, Inc.

Dated: October 4, 2002

_______________________________________
CONFIDENTIAL EXHIBIT A
CONFIDENTIAL EXHIBIT B
CONFIDENTIAL EXHIBIT C
CONFIDENTIAL EXHIBIT D
CONFIDENTIAL EXHIBIT E
CONFIDENTIAL EXHIBIT F
UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

__________________________________________

)

In the Matter of )

)

CHICAGO BRIDGE & IRON COMPANY N.V. )

)

a foreign corporation, )

) PUBLIC RECORD VERSION

CHICAGO BRIDGE & IRON COMPANY )

)

a corporation, )

 ) Docket No. 9300

and )

)

PITT-DES MOINES, INC. )

)

a corporation. )

__________________________________________)

The following persons should be notified of the Federal Trade Commission’s intent to disclose,

in a final decision, the confidential material contained in Complaint Counsel’s Opposition to

Respondents’ Motion to Strike: