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",1'1 8.2 

UNITED STATES OF AMERICA
 

BEFORE THE FEDERAL TRADE COMMISSION
 

In the Matter of ) Docket No. 9327 

) 

) 

Polypore International, Inc. 

) 

) 

a corporation ) PUBLIC 

) 

) 

) 

) 

RESPONDENT'S REPLY MEMORANDUM IN SUPPORT OF SECOND MOTION TO 

REOPEN THE HEARING RECORD 

Respondent, Polypore International, Inc. ("Polypore"), respectfully submits this Reply 

Memorandum in Support of Second Motion to Reopen the' Hearing Record ("Reply") pursuant to 

this Court's Order Requiring Reply Brief, dated October 2,2009 ("Order"). 

INTRODUCTION 

In their opposition to Respondent's Second Motion to Reopen the Hearing Record, 

Complaint Counsel mischaracterizes Respondent's argument and wholly ignores a central point 

of Respondent's motion: namely, that due to l 

1. No where in its oppositon does Complaint Counsel 
 even

mention ( 1. Instead, Complaint Counsel creates the 

baseless argument that Respondent's motion is intended to delay a ruing by this Court, ignoring 

the fact that all that Respondent seeks is a half-di;y hearing to receive additional facts regarding 
1 But certainly ( the state of Daramic's business. 


must have relevance even to Complaint ) 

Harr Seibert, 

sworn to October 6,2009 ("Seibert Aff."), ir 15. And certainly Respondent's proffered facts, 

which show that ( 1, have relevance to 

Complaint Counsel's claim that Daramic is a monopolist. 

For the reasons stated in Daramic's motion and herein, Daramic's motion should be 

granted to permit the Cour to receive additional evidence regarding ( 

Counsel's "market structure, concentration, or entr." Opp. p. 2; see Affdavit of 


1. 

ARGUMENT 

Tn its proffer, Respondent states that it intends to present evidence at a half-day hearing of 

(1)( 

1; (2) ( 

1; (3) ( 

l; (4) 

( 

1, all of which is 

new evidence that Daramic does not have market power. Although Complaint Counsel 

i Complaint Counsclattempts to create its "delay" iigument out of whole cloth by iiguing, without any justification. 

that it would need the "opportunity to gather evidence or ongoing anticompetitive conduct by Respondent." Opp. p. 3. The issue 

before this Court is a narrow one: whether the record should be reopened to permit the introduction of evidence at II half-day 

heiiing regarding Exide's recent conduct with Daramic and the effect on Diiamic's business resulling rrom this conduct and the 

continuing recession. Diiamic is not asking to reopen Ihe record 10 permit the introduction of evidence as to other aspects of 

Complaint Counsel's case and Complaint Counsel should not be permitted to conjure up a delay iigumenl by advancing a 

specious iigument that it must be permitted the opportnity to gather evidence as to Daramic's business conduct. Complaint 

Counsel nees no such discovery; Indeed, they have done just fine without it as demonstrated by their submisson of Mr. 

Gilespie's decliiation in opposition to this motion. 
selectively picked which aspects of 
 the proffer to discuss - ignoring the central issue regarding

l - each of these proffered facts is relevant
 ( 

and admissible under Commission Rule 3.43, constituting evidence which was not known at the 

time of the hearing. 2
 

A. Respondent's Proffer is Relevant and Admissible
 

Respondent's proffer is relevant to the issues in this case. 

Complaint Counsel claims that Respondent is a monopolist in a North America market 

for PE separators used in automotive, deep cycle, UPS and motive batteries. See e.g. Complaint 

~ 21-24,39. Complaint Counsel has offered testimony to this Court regarding Daramic's share 

Each part of 


these alleged North America markets, directly implicating Daramic's production 

capacity and customer demand for its products in North America; See e.g. Complaint Counsel 

of certain of 


Proposed FOF 273, 288, 291,305,306. Here, Respondent's proffered evidence goes directly to 

the alleged North America market as well as the demand for the issue ofDaramic's share of 


those products. In addition, with this decline in demand for separators for SLI applications in 

North America, ( 

l. 

Moreover. Complaint Counsel alleges that Daramic exercises monopolistic power in its 

pricing. See e.g. Complaint ir 39. Even in its opposition to this motion, Complaint Counsel 

again accuses Daramic of charging customers "monopoly prices." Opp. p. 2. Certainly, 

Daramic's proffer, which wil demonstrate that ( 

), is relevant to Complaint Counsel's case and its 

2 Complaint Counsel suggests that Ihe standard for reopening the record ,here is set forth in Brake Guard Products. Inc. 

125 F.T.C. at 248, n. 38. Complaint Counsel is incorrect, Brake Guard Products involved a motion to reopen under 3.54(a) of 

the Commission's rules, not Rule 3.51(e) as here. Even under Rule 3.54(a), courts have reopened the røcord to admit the hearing before the Administrative Law Judge. See e.g, Chrysler Corp. v. supplemental evidence not available at the time of 
 the record by the Commission to Federal Trade Commission, 561 F.2d 357, 362-63 (D.C: Cir. i 977) (upholding the reopening of


the trial before the ALJ in Chrysler Corp., 87 F.T.C, 719,750 admit supplemental evidence which was not available at the time of 


n.38 (1976)). In any event, the facts here more than demonstrate good cause. 
unsupported rhetoric? While Compliiint Counsel takes a lackadaisical view of ( 

), Daramic does not and this Cour should be permitted to consider all of 

these relevant facts in addressing Complaint Counsel's claims and remedy. 

Complaint Counsel argues that Respondent's proffer ( 

") Complaint Counsel is incorrect. As 

demonstrated here, Daramic has ample evidence that t 

1. Seibert Aff. ir 6. And t 

1. Gilespie Declaration ~ 6. Again,
 

this evidence directly refutes a highly relevant issue in this case: Daramic's supposed monopoly 

power. 

Complaint Counsel has offered evidence to this Cour regarding the supposed need for 

local separator supply. See e.g. Complaint Counsel Proposed FOF 174~198. Respondent's 

proffered evidence, showing ( 

1, is relevant evidence to further refute Complaint Counsel's 

contention. The fact that l 

1 should not be held against Respondent. 

Complaint Counsel contends that entr cannot occur in less than two years in this alleged 

Nort America market. See e.g, Complaint Counsel Proposed FOF 817~1043. Certy, 

( 

) Complaint Counsel's answer to this motion is to siiy dismissively that if (CO 

"1 Opp. p. 5. Complaint Counsel's
 

argument is absurd and completely ignores the great import of the proffered facts. (
 

")
 
1. 

Respondent has offered evidence that ( l. Complaint Counsel has 

argued to this Court that that is not the case; ( l. 

The proffered facts, showing that ( 

l, as Daramic has insisted 

thoughout this proceeding. Again, the fact that ( 

l should not be 

held against Respondent in this hearing. 

All of the foregoing 
 ,evidence is admissible under the Commissions rules. Respondent

wil present this evidence through the testimony of 
 Mr. Hary Seibert, Dannie's VP, Business

Global Procurement for Exide, and 

related communcations between Exide and Daramic concerning the Purchase Orders and the 

Director, and Mr. Douglas Gilespie, Vice President of 


Mr. Robert Toth, Polypore's 

President, CEO and Director and related documentation regarding ( 

contract negotiations. Daramic may also present the testimony of 


these witnesses has personal knowledge of
 these subjects and the documents l. Each of 


wil be authenticated and are admissible.
 

Moreover, this proffere~ evidence is in no way cumulative since, as discussed further 

below, the significant events at issue here had not occured prior to or during the hearing. 

. Respondent did not introduce evidence of its (
 

l. 

. Respondent did not introducc at the hearing evidence of (I) (
 
l, (2) f 

1, (3) ( 

l. 

Evidence is excludable as being cumulative only when the evidence is unecessarily 

duplicative of other evidence already in the record. See In the Matter of Rambus, Inc., 2006 FTC 

i IOn. 1 i (2006). For the reasons stated herein, this is certainly not the case here. 

B. Exide's Declaration Skirts the Issnes
 

In its Order, this Court specifically ordered Respondent to address "(w)hether
 

Respondent possesses evidence disputing the assertions of fact in the Declaration of Douglas 

Gilespie, submitted with the Opposition as Attachment A." Respondent has requested that 

Complaint Counsel permit Respondent to review Mr. Gilespie's declaration, which was 

previously submitted in camera. Complaint Counsel has refused this request, greatly impeding 

Respondent's abilty to respond to the Court's order and prejudicing it in this proceeding. 4 

Complaint Counsel relies heavily on Mr. Douglas Gilespie's declaration to f 

l In light of the fact that Respondent's motion was filed under seal, the
 

fact that Mr. Gilespie submitted a declaration in response to a motion largely fied in camera 

raises many serious questions. Indeed, Complaint Counsel should explain to this Cour how it 

was Mr. Gilespie was able to respond to Respondent's Motion when it was largely confidential 

and filed in 
 this Cour under seal and In camera. At a minimum, though, it suggests that

Complaint Counsel and Exide continue their highly orchestrated presentation to this Cour.s 

Gilespie's declaration is most notable for what it does not say: 

4 Respondent has fied with this Reply a motion to pennjt Respondent to see Mr. Gilespie's declaration.

~ 

S At the hearing, Mr. Gilespie offered completely rehearsed and coached testimony iii response to Complaint
 

Counsel's questions regarding the nature of the relief that should be provided by this Court. Respondent's Proposed FOP '602. 

Unfortunalely. the highly orchestrated nalureofExide's testimony to Ihis Court continues with Complaint Counsel's opposition.
 
1. Seibert Aff. , 7.
 

. (
 

l. 

. (
 

1. Seibert Aff. irir 5-6. 

. (
 

). Seibert Aff. irir
 

( 

l. Seibert Aff.
 

" 5-6, l4-15.
 

. (
 

Fact , 526. Mr. Gilespie's
 l. Respondent's Proposed Findings of 


statement in his declaration is not accurate and is not based on personal
 

knowledge and therefore must be stricken. 
Mr. Gilespie's declaration is wholly incomplete and inaccurate and Respondent
 

possesses ample evidence to offer this Court in support of its proffer if the record were reopened. 

C. Respondent Became Aware of, the Facts Asserted in the Proffer After the 

Hearing 

As discussed in Respondent's Motion, ( 

1. Motion pp. 2-3; 

Seibert Aff. ir 7. Respondent was f 

1. Seibert Aff. ir 10. 

Respondent has been strggling with its business in light of the recession and its loss of 

its largest customer, JCI. This was in fact known during the hearng. What was not known, and 

could not have been known, however, was the impact to Daramic's business in Nort America 

caused by the continuing effect of a prolonged recession and ( 

). (
 

l. Seibert Aff. irir 14-15. l 

1. 

Seibert Aff.' 15. (
 

l. Seibert Aff. ir 15.
 

Respondent did not know and couIdnot have known of these facts as they had not yet occurred 

at the time of the hearing. The import of these facts, however, is clear and should be received in 

evidence for this Court to consider in making its weighty decisions in thi~ matter. 

D. Respondent Wil be Prejudiced if this Court Denies this Motion 
This Court currently has before it a complaint seeking a finding from this Court that 

Respondent is a monopolist and that its acquisition of Micro porous Products LP violates the 

antitrst laws and should be unwound. Respondent denies these allegations, submitting evidence 

as to its defenses and to refute Complaint Counsel's claims, including its evidence of ( 

1. This Court's decision has serious ramifications for Respondent's 

business which is strggling today. This Cour should be permitted to have all of the relevant 

and most current facts in making its determinations as to whether Complaint Counsel met its 

burden and, if so, what relief is necessary 
 and appropriate. To deny the current motion would

severely prejudice Respondent as this Cour would not be able to consider the evidence showing 

(1)( 

), (2) 

(	 L. (3) ( 

), and (4) ( 

antitrust analysis here is forward 

looking. This Cour must consider this curent evidence in making its decision. 

-i 
Dated: October 7, 2009
 Respectfully SUQmitted,
 

to.?l~' Wilham L.' Rikard, Jr. 

, Eric D. Welsh 

PARR POE ADAMS & BERNSTEIN, LLP 

Three Wachovia Center 

401 South Tryon Street, SuIte3000 

Charlotte, NC 28202 

Telephone: (704) 372-9000 

Facsimile: (704) 335-9689 

williamrikard(fparkerpoe.com 

ericwelsh(fparkerpoe.com 

John F. Graybeal 

PARKER POE ADAMS & BERNSTEIN, LLP 

150 Fayettevile Street 

Raleigh, NC 27602 

Telephone: (919) 835-4599 

Facsimile: (919) 828-0564 

joligraybeal(fparkerpoe.com 

Attorneys for Respondent 
CERTIFICATE OF SERVICE 

r hereby certifY that on October 7, 2009, I caused to be fied via hand delivery and 

electronic mail delivery an original and two copies of the foregoing Respondent's Reply
 

Memorandum In Support of Second Motion to Reopen the Hearing Record ¡Public), and that 

the electronic copy is a true and correct copy of 
 the paper original and that a paper copy with an 

original signature is being fied with: 

Donald S. Clark, Secretary 

Office of the Secretary 

Federal Trade Commission 

600 Pennsylvania 
 Avenue, NW, Rm. H-135 

Washington, DC 20580 

, secretary¡§ftc.gov 

I hereby certifY that on October 7, 2009, I caused to be served one copy via electronic 

mail delivery and two copies via overnight delivery of the foregoing Respondent's Reply
 

Memorandum In Support of Second Motion to Reopen the Hearing Record ¡Public) upon: 

The Honorable D. Michael Chappell 

Administrative Law Judge 

Federal Trade Commission 

600 Pennsylvanià Avenue, NW 

Washington, DC 20580 

oalj¡§ftc.gov 

I hereby certify that on October 7, 2009, I caused to be served via electronic mail delivery 

and one copy via First Class mail delivery of the foregoing Respondent's Reply Memorandum 

In Support 
 of Second Motion to Reopen the Hearing Record ¡Public) upon: 

J. Robert Roberton, Esq. Steven Dahin, Esq. 

Federal Trade Commission Federal Trade Commission 

600 Pennsylvania A venue, NW 600 Pennsylvania Avenue, NW 

Washington, DC 20580 Washington, DC 20580 

rrobertson¡§ftc.gov sdah¡§ftc.gov 

Brian R. Weyhri 

3~~~

Parker Poe Adams & Bernstein LLP 

Three Wachovia Center 

40 i South Tryon Street, Suite 3000 

Charlotte; NC 28202 

Telephone: (704) 372-9000 

Facsimile: (704) 334-4706