UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

In the Matter of )

)

Service Corporation International, ) Docket No. C-4423

a corporation, and ) File No. 131 0163

)

Stewart Enterprises, Inc., )

a corporation )

) 

PETITION FOR APPROVAL OF PROPOSED DIVESTITURE

 

Pursuant to Section 2.41(f) of the Federal Trade Commission 

(“Commission”) Rules of Practice and Procedure, 16 C.F.R. § 2.41(f) (2012), and 

Paragraphs II.A of the Decision and Order contained in the Agreement Containing Consent 

Orders accepted for public comment in this matter (“Decision and Order”), Respondent 

Service Corporation International (“SCI”) hereby petitions the Commission to approve the 

divestiture to Heritage Oaks Memorial Group, Inc. (“HOMG”) of the Divestiture Business 

that includes the following facility: Lassila Funeral Chapel – Auburn, 551 Grass Valley 

Highway, Auburn, California 95603.

Subject to the Commission’s approval of this Petition, the Divestiture 

Businesses associated with this facility (as defined in the Decision and Order, and 

hereinafter collectively referred to as the “Divestiture Assets”) will be sold to HOMG 

pursuant to the Asset Sale Agreement dated April 18, 2014, by and among HOMG and an 

affiliate of SCI (the “ASA”).

PUBLIC VERSION 1
Background

On December 23, 2013, SCI and Stewart Enterprises, Inc. (“Stewart”) 

(collectively, the “Respondents”) executed an Agreement Containing Consent Orders that 

included the Decision and Order and Order to Hold Separate and Maintain Assets 

(collectively, the “Consent Agreement”) to settle the Commission’s charges that the 

proposed acquisition by SCI of Stewart would violate Section 5 of the Federal Trade 

Commission Act, as amended, 15 U.S.C. § 45, and Section 7 of the Clayton Act, as 

amended, 15 U.S.C. § 18. On December 23, 2013, the Commission accepted the Consent 

Agreement for public comment, and on December 23, 2013, SCI consummated its 

acquisition of Stewart. Stewart is now a wholly owned subsidiary of SCI. The Consent 

Agreement is presently before the Commission for final approval and issuance of the orders 

contained therein. 

Because this petition and its attachments contain confidential and 

competitively sensitive business information relating to the divestiture of the Divestiture 

Assets—the disclosure of which may prejudice Respondents and HOMG, cause harm to the 

ongoing competitiveness of the Divestiture Assets, and impair Respondents’ ability to 

comply with their obligations under the Consent Agreement—Respondents have redacted 

such confidential information from the public version of this petition and its attachments. 

Pursuant to Sections 2.41(f)(4) and 4.9(c) of the Commission’s Rules of Practice and 

Procedure, 16 C.F.R. § 2.41(f)(4) & 4.9(c) (2012), Respondents request that the non-public, 

confidential version of this petition and its attachments and the information contained 

herein be accorded confidential treatment. The confidential version of this petition should 

be accorded such confidential treatment under 5 U.S.C. § 552 and Section 4.10(a)(2) of the 

PUBLIC VERSION 2
Commission’s Rules of Practice and Procedure, 16 C.F.R. § 4.10(a)(2) (2012). The 

confidential version of this petition is also exempt from disclosure under Exemptions 4, 

7(A), 7(B), and 7(C) of the Freedom of Information Act, 5 U.S.C. §§ 552(b)(4), 

552(b)(7)(A), 552(b)(7)(B), & 552(b)(7)(C), and the Hart-Scott-Rodino Antitrust 

Improvements Act of 1976, as amended, 15 U.S.C. § 18a(h). 

Respondent SCI desires to complete the proposed divestiture of the 

Divestiture Assets as soon as possible, following Commission approval thereof. All 

conditions to closing other than Commission approval have already been satisfied so that 

SCI and HOMG are in a position to close the divestiture within a few days of such 

approval. Prompt consummation will further the purposes of the Decision and Order and is 

in the interests of the public, HOMG, and the Respondents, because it will allow HOMG to 

move forward with its business plans for the competitive operation of the Divestiture 

Assets. SCI accordingly requests that the Commission promptly commence the period of 

public comment pursuant to Section 2.41(f)(2) of the Commission’s Rules of Practice and 

Procedure, 16 C.F.R. § 2.41(f)(2) (2012), limit the public comment period to the customary 

30-day period, and grant this petition by approving the divestiture of the Divestiture Assets 

to HOMG pursuant to the above-referenced ASA as soon as practicable after the close of 

the public comment period. 

I. The ASA Is Final and Consistent with the Decision and Order’s Terms

Paragraph II.A of the Decision and Order requires the Respondents to divest the 

Divestiture Businesses (as defined in the Decision and Order) within 180 days of the date on 

which the Order is issued.1

 Pursuant to this requirement, SCI diligently has sought a buyer that 

1 The Commission has not yet issued the Order as final.

PUBLIC VERSION 3
would be acceptable to the Commission, through an extensive auction process that produced 

great interest in the properties. As noted above, on April 18, 2014, an affiliate of SCI entered 

into the ASA with HOMG, which requires SCI to sell the Divestiture Assets to HOMG. The 

executed ASA is attached hereto as Confidential Exhibit A. 

The ASA with HOMG complies with the requirements of Paragraph II of the 

Decision and Order. 

Paragraph II.A requires that Respondents divest the Divestiture Assets, absolutely 

and in good faith. Pursuant to the ASA, HOMG will acquire the Divestiture Assets. See ASA § 

1.1. 

Paragraph II.A.2 of the Decision and Order requires Respondent to grant a

License to all Retained Intellectual Property that will permit the Acquirer to operate the relevant 

Divestiture Business in substantially the same manner as Respondents. Along with the assets it 

is acquiring through the ASA, HOMG has all the intellectual property it needs to operate the 

Divesture Assets in substantially the same manner as Respondents. 

Paragraph II.C.1 of the Decision and Order provides that Respondents may use 

the “Lassila” trade name for the funeral home located at 406 H Street, Lincoln, California 95648, 

if applicable, for a period of up to twelve (12) months after the Divestiture Date. The ASA 

provides that SCI may use the “Lassila” trade name in the operation of the business located at 

406 H Street, Lincoln, California 95648, for a period of up to twelve (12) months from the 

Closing Date. See ASA § 5.23. 

HOMG has acknowledged that the Divestiture Assets, together with the HOMG’s 

existing resources, enable HOMG to operate the Divestiture Businesses as ongoing entities and 

that no other assets are needed from SCI to do so. See ASA §4.4. 

PUBLIC VERSION 4
* * * 

As demonstrated above and in the accompanying ASA, SCI has entered into an 

agreement relating to the divestiture of the Divestiture Assets that fully complies with the 

Commission’s Decision and Order with respect to the divestiture of these assets. Accordingly, 

Respondents hereby seek Commission approval of the proposed divestitures pursuant to 

Paragraph II.A of the Decision and Order. 

II. The Prospective Acquirer Will Be a Strong and Effective Competitor

A. Background 

HOMG has experience in operating funeral homes, has the financial wherewithal 

to make this acquisition, and the acquisition of the businesses in question by HOMG will ensure 

that those businesses remain strong and effective competitors in the Auburn, California, area. 

Founded in 2008, HOMG is owned by Ron and Chris Harder and James Beeding. 

HOMG currently owns and operates Heritage Oaks Memorial Chapel in Rocklin, California. 

The mission statement for Heritage Oaks Memorial Chapel demonstrates HOMG’s approach to 

funeral care: “Serving the Living by Caring for their Loved Ones with Compassion, Dignity, 

Respect & Integrity.” 

HOMG actively markets the Heritage Oaks Memorial Chapel facility and intends 

to extend these marketing efforts to the Divestiture Assets. One hallmark of HOMG’s marketing 

efforts for the Heritage Oaks Memorial Chapel facility is presenting “Preparing Is Caring” and 

“Good Grief” seminars for people involved in grief care (hospice, chaplains, pastors, support 

group leaders, medical and education staff) to provide education, encouragement and support, as 

well as to market the Heritage Oaks Memorial Chapel facility. In addition, Ron Harder, Chris 

Harder, and James Beeding are active members of many local community organizations in the 

PUBLIC VERSION 5
Roseville and Rocklin areas, including Chambers of Commerce, Kiwanis Clubs, the Older Adult 

Collaborative, and several business networking groups. This involvement with community 

members and service organizations, along with their presence at the Spring and Fall Lincoln 

Hills Business & Health Fair, allows them to develop one-on-one relationships and build trust 

and credibility in their community. 

Since its inception in 2008, HOMG has seen growth in the Heritage Oaks 

Memorial Chapel facility. Starting from scratch, Heritage Oaks Memorial Chapel has grown to 

serve over 1,000 calls since opening, of which 292 were in 2013. In addition, revenues have also 

grown steadily since 2008. 

More information about HOMG and the Heritage Oaks Memorial Chapel is 

available at http://www.heritageoaksmemorialchapel.com. 

B. Financial Capability

HOMG has the funds to make this purchase, cover closing costs, and have 

working capital. HOMG seeks to acquire the Divestiture Assets for a purchase price of 

C. Operations Experience

HOMG, along with its owners, Ron and Chris Harder and James Beeding, are 

experienced funeral home operators who are capable of operating the Divestiture Assets 

successfully.

As noted above, HOMG has owned and operated the Heritage Oaks Memorial 

Chapel in Rocklin, California, since 2008. Heritage Oaks Memorial Chapel is a full-service 

funeral and cremation services provider that benefits from a significant number of referrals from 

families previously served. HOMG has engaged in a focused effort to grow preneed sales. 

PUBLIC VERSION 6
These preneed sales efforts have resulted in a growing number of at-need calls and increased 

visibility in the Rocklin community. HOMG intends to apply this same strong preneed sales 

focus to the Divestiture Assets.

HOMG’s owners have extensive experience in owning and operating funeral 

homes in addition to their experience with Heritage Oaks Funeral Chapel. James Beeding is a 

licensed funeral director with twenty-two years of experience in the profession. Early in his 

career, he received his training at a prominent family-owned mortuary which provided the 

inspiration to one day own a funeral home. Immediately prior to joining HOMG in 2008, Mr. 

Beeding was employed by the Neptune Society of Northern California. Mr. Beeding worked for 

the Neptune Society from 2000 to 2008 and served as Managing Funeral Director for the last five 

years of his tenure there. Mr. Beeding will apply his wealth of knowledge and experience in this 

industry and in the greater Sacramento area to the successful integration and operation of the 

Divestiture Assets. 

Ron Harder is a licensed funeral director and also maintains an insurance license. 

In founding and operating HOMG, Mr. Harder provides experience in sales, marketing, finance, 

and pastoral care, and an entrepreneurial spirit. He obtained his funeral director’s license in 

2009 while also retaining his insurance license which made it possible to grow HOMG’s preneed 

arrangements. He began his insurance career in 1991. He successfully grew his insurance 

business into a financial planning practice, Mr. Harder was able to 

use his knowledge of financial advising and estate planning in major donor development and 

began working with Trans World Radio (TWR), a non-profit ministry. In 2008, after eight and a 

half years with TWR, he felt called to the funeral and grief care business, in part due to the 

PUBLIC VERSION 7
passing of his son, Zachary, two years earlier. Mr. Harder began his career in the death care 

industry by opening Heritage Oaks Memorial Chapel with his wife, Chris, and James Beeding. 

Prior to founding HOMG, Chris Harder had over 30 years of administrative and 

accounting experience. She served as the Office Administrator for Nordson Corporation’s West 

Coast Regional Office for 10 years until it closed in 2000 and then spent 11 years as Assistant to 

the Regional Director with Life Care Services. Both of these positions provided a variety of 

experience, including accounting, statistical reports, scheduling, presentations, event planning 

and inventory control. She applies this experience in a variety of capacities to HOMG, including 

developing marketing materials and managing HOMG’s website which provides valuable 

Internet exposure for Heritage Oaks Memorial Chapel.

 Thus, HOMG has sufficient operating expertise to not only ensure the continued 

competitiveness of the Divestiture Assets, but to enhance it. 

III. The Proposed Divestiture Agreement Will Achieve the Purposes of the Decision and 

Order and Result in No Harm to Competition

The proposed divestiture of the Divestiture Assets, as embodied in the ASA, will 

achieve the purposes of the Decision and Order. HOMG is an experienced operator of a funeral 

home with a proven track record of successfully operating and enhancing the competitiveness of 

that funeral home. HOMG enjoys a strong financial position that will enable it to complete this 

PUBLIC VERSION 8
acquisition, continue the operation of the Divestiture Assets and enhance their competitiveness in 

the market for funeral services. Combining the Divestiture Assets with HOMG’s experience and 

financial wherewithal will ensure that the objectives of the Commission’s Decision and Order 

will be realized.

The proposed divestiture will result in no harm to competition. HOMG currently 

does not own or operate any funeral homes in same geographic market (as alleged in the 

Commission’s complaint) as the Divestiture Assets. Consequently, the proposed divestiture does 

not raise any competitive issue. 

In sum, the proposed divestiture will remedy any alleged anticompetitive effects 

that could result from the Acquisition. The ASA will achieve the Commission’s stated purposes 

of ensuring the continued use of the Divestiture Assets in the same business in which they were 

engaged at the time of the announcement of the Acquisition and remedying the lessening of 

competition as alleged in the Commission’s Complaint. 

[REST OF PAGE INTENTIONALLY LEFT BLANK]

PUBLIC VERSION 9
PUBLIC VERSION 

Conclusion 

For the foregoing reasons, Respondents respectfully request that the 

Commission approve the proposed divestiture of the Divestiture Assets to HOMG, as 

embodied in the ASA, as soon as practicable after expiration of the public comment period. 

Respectfully submitted, 

Amanda L. Wait 

Hunton & Williams LLP 

2200 Pennsylvania Ave NW 

Washington, D.C. 20037 

(202) 955-1502 

Counsel for Respondents 

Dated: t\!:\lr\\ Z...'i. Z.Oii..J 

\ 6 

10 
PUBLIC VERSION 11

CERTIFICATION OF SERVICE CORPORATION INTERNATIONAL 

The facts and information related in the foregoing Petition, insofar as they pertain to Service 

Corporation International, its subsidiaries, and its assets, are, to the best of my knowledge, 

true, correct, and complete. 

Pursuant to 28 U.S.C. § 1746, I certify under penalty of perjury under the laws ofthe United 

States of nca at the foregoing is true and correct. 

Business Development 

oration International 
PUBLIC VERSION 

CERTIFICATION OF HERITAGE OAKS MEMORIAL GROUP, INC. 

The facts and information related in the foregoing Petition, insofar as they pertain to 

Heritage Oaks Memorial Group, Inc., its subsidiaries, and its assets, are, to the best of my 

knowledge, true, correct, and complete. 

Pursuant to 28 U.S.C. § 1746, I certifY under penalty of perjury under the Jaws of the United 

States of America that the foregoing is true and correct. 

Ron 

4Ji(,{{;~ Harder 

President 

Heritage Oaks Memorial Group, Inc. 

12 
Confidential 

Exhibit A 

PUBLIC VERSION