UNITED STATES OF AMERICA

BEFORE THE FEDERAL TRADE COMMISSION

OFFICE OF ADMINISTRATIVE LAW JUDGES

In the Matter of

MeWANE, INC.,

a corporation, and

STAR PIPE PRODUCTS, LTD.,

a limited partnership.

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DOCKET NO. 9351

RESPONDENT MCWANE, INC.'S PROPOSED STIPULATIONS OF LAW, FACT, AND

AUTHENTICITY

Respondent McWane, Inc. ("McWane") hereby submits its proposed stipulations oflaw,

fact, and authenticity. The following proposed stipulations are in addition to the Joint

Stipulations of Fact and Law, filed by the parties on August 28,2012, pursuant to the Scheduling

Order. McWane notes that the parties could not reach an agreement on the proposed stipulations

below. McWane reserves the right to offer any additional stipulations of law, fact and

authenticity subsequently agreed to by the parties, as provided for in the Scheduling Order.

I. Stipulations of Law

1. The standards outlined by the Supreme Court in Daubert v. Merrell Dow Pharms., Inc., 509

U.S. 579 (1993), apply to all expert testimony, including that of economists. Kuhmo Tire Co.

v. Carmichael, 526 U.S. 137, 148 (1999) ("There is no clear line that divides the one from

the others.").

2. "When an expert opinion is not supported by sufficient facts to validate it in the eyes ofthe

law, or when indisputable record facts contradict or otherwise render the opinion

unreasonable, in cannot support ajury's verdict." Brooke Group Ltd v. Brown & Williamson

Tobacco Corp., 509 U.S. 209, 242 (1993).

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3.	 "Expert testimony is useful as a guide to interpreting market facts, but it is not a substitute for 

them." Id. 

II. Stipulations of Fact 

1.	 There is no evidence that McWane directly communicated its prices to any other DIWF 

manufacturer or supplier in advance of communicating them to its customers or potential 

customers. 

2.	 There is no evidence that any other DIWF manufacturer or supplier learned of McWane's 

prices in advance of McWane informing its customers. 

3.	 DIFRA was only operational from mid-2008 through the end of2008. 

4.	 There is no evidence that DIFRA will become operational again or will gather and 

disseminate DIWF sales or any other volume data at any point in the future. 

5.	 There are more than 630 waterworks distributors in the United States. 

6.	 Complaint Counsel cannot identify a single waterworks distributor that was prevented from 

purchasing Star's domestic fittings by McWane's September 2009 rebate policy. 

7.	 There are more than 400 waterworks distributors in the United States that did not purchase 

domestic fittings from McWane between September 2009 and September 2010. 

8.	 Complaint Counsel's expert, Dr. Schumann, has not quantified any degree of foreclosure that 

Star has incurred as a result of McWane's September 2009 rebate policy. 

9.	 Complaint Counsel's expert, Dr. Schumann, has not quantified any costs Star has incurred as 

a result of McWane's September 2009 rebate policy. 

10. Complaint Counsel's expert, Dr. Schumann, concedes that there were no meetings between 

McWane and any competitor in "smoke-filled rooms" to discuss prices. 

11. McWane's January 11,2008 letter to its customers (CX 2172) does not say anything on its 

face regarding centralized authority for project pricing. 

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12. McWane's January 11,2008 letter to its customers (CX 2172) does not say anything on its 

face regarding reducing or discontinuing project pricing. 

13. McWane's May 7,2008 letter to its customers (CX 2170) does not say anything on its face 

regarding DIFRA. 

14. In June 2009, Star announced that it would begin selling a full range of small, medium and 

large diameter fittings made for Star by outside foundries in the United States. 

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34. Sigma approached McWane in 2009 regarding entering the Master Distributorship 

Agreement. 

35. At all relevant times, domestic fittings and non-domestic fittings competed against each other 

in open preference jobs including before, during, and after ARRA. 

36. Domestic fittings and non-domestic fittings are functionally interchangeable. 

37. Since at least 2003, the majority of requests for proposal and specifications that include 

DIWF that were issued in the United States were open preference. 

38. Non-domestic fittings have accounted for the majority of all sales ofDIWF in the United 

States since at least 2007. 

39. McWane's average price for non-domestic fittings was lower in 2010 than in 2008. 

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40. Between 2003 and 2011, McWane's share of domestic and non-domestic fittings dropped 

from approximately 70% to 40%. 

41. In the last 15 years, domestic fittings have lost substantial market share to non-domestic 

fittings. 

42. Between 2000 and 2007, according to the U.S. lTC, sales of non-domestic fittings into the 

United States have increased by 47.2%. 

III. Stipulations of Authenticity 

McWane proposes stipulating to the authenticity of the following documents. McWane 

reserves the right to object to any document as irrelevant, immaterial, hearsay or for any other 

basis permitted for objection under the Federal Rules of Evidence or Rules of this Court. 

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lsI J. Alan Truitt 

J. Alan Truitt 

Thomas W. Thagard III 

Maynard Cooper and Gale PC 

1901 Sixth Avenue North 

2400 Regions Harbert Plaza 

Birmingham, AL 35203 

Phone: 205.254.1000 

Fax: 205.254.1999 

atruitt@maynardcooper.com 

tthagard@maynardcooper.com 

Dated: September 20,2012 

lsI Joseph A. Ostoyich 

Joseph A. Ostoyich 

Erik T. Koons 

William C. Lavery 

Heather Souder Choi 

Baker Botts L.L.P. 

The Warner 

1299 Pennsylvania Ave., N.W. 

Washington, D.C. 20004-2420 

Phone: 202.639.7700 

Fax: 202.639.7890 

joseph.ostoyich@bakerbotts.com 

erik.koons@bakerbotts.com 

william.lavery@bakerbotts.com 

heather.choi@bakerbotts.com 

Attorneys for Respondent Me Wane, Inc 

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CERTIFICATE OF SERVICE
 

I hereby certify that on September 20,2012, I filed the foregoing document electronically using 

the FTC's E-Filing System, which will send notification of such filing to: 

Donald S. Clark 

Secretary 

Federal Trade Commission 

600 Pennsylvania Ave., NW, Rm. H-l13 

Washington, DC 20580 

I also certify that I delivered via overnight mail a copy of the foregoing document to: 

The Honorable D. Michael Chappell 

Administrative Law Judge 

Federal Trade Commission 

600 Pennsylvania Ave., NW, Rm. H-11O 

Washington, DC 20580 

I further certify that I served via electronic mail a copy ofthe foregoing document to: 

Edward Hassi, Esq. 

Geoffrey M. Green, Esq. 

Linda Holleran, Esq. 

Thomas H. Brock, Esq. 

Michael L. Bloom, Esq. 

Jeanine K. Balbach, Esq. 

J. Alexander Ansaldo, Esq. 

Andrew K. Mann, Esq. 

By: lsi William C. Lavery 

William C. Lavery 

Counsel for Mc Wane, Inc. 

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