UNITED STATES OF AMERICA

BEFORE THE FEDERAL TRADE COMMISSION

OFFICE OF ADMINISTRATIVE LAW JUDGES

In the Matter of

McWANE, INC.,

a corporation, and

STAR PIPE PRODUCTS, LTD.,

a limited partnership.

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DOCKET NO. 9351

RESPONDENT MCWANE, INC.'S SUPPLEMENTAL

RESPONSES TO COMPLAINT COUNSEL'S

REQUESTS FOR ADMISSION

COMES NOW, McWane, Inc. ("McWane") and, in accordance with the Court's Order

dated July 5, 2012, supplements its responses to Complaint Counsel's Requests for Admission

("Requests") as follows:

GENERAL OBJECTIONS

1. McWane objects to the Definitions and Instructions to the extent they seek to

impose discovery obligations exceeding the requirements of the Federal Trade Commission's

Rules of Practice.

2. McWane submits its objections and responses without conceding the relevancy or

materiality ofthe subject matter of any ofthe Requests, and without prejudice to all objections to

the admissibility of any response. McWane's responses are made without waiving, or intending

to waive, the right to object on the grounds of incompetency, privilege, relevancy, or materiality

(or any other grounds) to the use of any documents provided in response to the Requests, in any

subsequent proceeding in this action or any other action. McWane reserves the right to object on

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any and all grounds, at any time, to subsequent interrogatories and requests, or any other 

discovery procedures, involving or relating to the subject matter of the Requests. 

3. McWane objects to the Requests to the extent that they seek (a) confidential 

communications between McWane or its representatives and its counsel or its counsel's 

representatives; (b) the work product of McWane's attorneys; (c) information compiled in 

anticipation of litigation by, on behalf of, or at the direction of McWane's in-house or outside 

counsel; (d) information protected by the common interest privilege; (e) information protected by 

the First Amendment associational privilege; or (f) any other applicable privilege or protection. 

4. McWane objects to the Requests as improperly seeking from a party legal 

conclusions or expert opinions, the latter of which may be discovered only through expert reports 

or expert depositions. 

5. McWane's responses to the Requests shall not be deemed or construed to be a 

waiver of any privilege, right or objection. In the event privileged or work product information 

is inadvertently produced by McWane, such production is not and shall not be deemed or 

construed as a waiver of any privilege, right or objection, and McWane hereby reserves the right 

to claw back such inadvertently produced information. 

6. McWane objects to the Requests to the extent that they are not reasonably limited 

in time, geographic, or subject matter scope; to the extent they seek information outside 

McWane's custody and control; or to the extent they seek information regarding third parties 

with no relationship to the claims set forth in the Federal Trade Commission's January 4, 2012 

administrative complaint ("Complaint"). The disclosure of the latter information would be 

unduly and unnecessarily invasive of the privacy of third parties with no relationship to the 

Complaint. 

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7. McWane objects to the Requests as seeking information in the public domain, 

within Complaint Counsel's or the Commission's possession, or obtainable from a source other 

than McWane at less cost or burden to Complaint Counsel than to McWane. 

8. McWane objects to the Requests to the extent they are duplicative; call for the 

disclosure of information irrelevant to any claim or defense in this action; are not reasonably 

calculated to lead to the discovery of admissible evidence; or are overly broad or unduly 

burdensome. 

9. McWane reserves the right at any time to revise, correct, add to, or clarify its 

objections or responses to the Requests. 

10. Each of the above General Objections shall be deemed to apply to each of 

McWane's specific responses set forth below. 

SPECIFIC SUPPLEMENTAL RESPONSES 

In response to Complaint Counsel's requests that McWane admit the following, McWane 

responds as follows, subject to the General Objections set forth above: 

1. All ARRA Waterworks Projects are subject to a Buy American requirement. 

RESPONSE: 

McWane denies this Request, in light of the waivers and exemptions that permitted the 

use of non-domestic fittings and/or other products in ARRA Waterworks Projects under certain 

circumstances, thus making certain projects not subject to a Buy America requirement. The EPA 

issued a Nationwide Buy American waiver effective May 22, 2009 to allow the use of de 

minimis incidental components of eligible projects where such components comprise no more 

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than 5 percent of the total cost ofthe materials used in and incorporated into a project. _ 

See, e.g., 74 Federal Register, No. 104 (June 2, 

2009) 26398-99 (national waiver exempting from the Buy American requirement components 

that comprised less than 5% of the total cost of materials incorporated into a project); 74 Federal 

Register No. 152 (August 10, 2009) 39959-60; 

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; see "Tracking the De Minimis Waiver", available at 

http://dec.alaska.gov/water/muniloan/pdfs/De%20Minimis%20waiver%20tracking%20and%20e 

xample.pdf, (last accessed June 28, 2012). 

2. The Environmental Protection Agency ("EPA") must grant or approve any and all 

waivers to the Buy American requirement of ARRA for any ARRA Waterworks Project. 

RESPONSE: 

Admitted. However, McWane objects to this request as misleading, as the EPA in 2009 

issued the de minimis waiver, which was a blanket waiver that did not require application to and 

approval by the EPA for each job. 

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; see also Answer to RFAI, supra. 

3. Respondent cannot Identify any sale of Imported Relevant Product for use in an 

ARRA Waterworks Projects pursuant to a Public Interest Waiver other than the three Public 

Interest Waivers set forth in Exhibit A. 

RESPONSE: 

McWane has no first hand knowledge of a sale pursuant to a Public Interest Waiver 

because it has not attempted to sell any of its non-domestic fittings for use in an ARRA 

Waterworks Project pursuant to a Public Interest Waiver. McWane accordingly admits that it 

possesses no documentation of a grant of a Public Interest Waiver other than the three Public 

Interest Waivers set forth in Exhibit A but after reasonable inquiry, lacks sufficient information 

at this time to admit or deny this Request with respect to third parties. 

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4. Respondent is unaware of any statement or opinion by the EPA that Imported 

Relevant Product is an "incidental component," as described in 74 Federal Register No. 152 

(Monday, August 10, 2009) 39959-60. 

RESPONSE: 

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Denied. 

5. Respondent cannot Identify any sale of any Imported Relevant Product for use in 

any ARRA Waterworks Projects pursuant to the waiver for de minimis incidental components as 

described in 74 Federal Register No. 152 (Monday, August 10,2009) 39959-60. 

RESPONSE: 

McWane admits it has no first-hand knowledge of a grant of the de minimis waiver 

because it did not attempt to sell any of its non-domestic fittings for use in an ARRA 

Waterworks Project pursuant to the waiver for de minimis incidental components as described in 

74 Federal Register No. 152 (Monday, August 10,2009) 39959-60. 

Thus, after reasonable inquiry, McWane lacks sufficient 

information at this time to admit or deny this Request with respect to third parties. See, e.g., 74 

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Federal Register, No. 104 (June 2, 2009) 26398-99; 74 Federal Register No. 152 (August 10,
 

2009) 39959-60;
 

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"Tracking 

the De Minimis Waiver", available at 

http://dec.alaska.gov/water/muniloan/pdfs/De%20Minimis%20waiver%20tracking%20and%20e 

xample.pdf, (last accessed June 28, 2012). 

6. Respondent cannot Identify any sale of any Imported Relevant Product that was 

Manufactured in Mexico or Canada for use in any ARRA Waterworks Project. 

RESPONSE: 

McWane admits it has no first-hand knowledge of any sales of Imported Relevant 

Product Manufactured in Mexico or Canada for use in any ARRA Waterworks Project because it 

does not manufacture Imported Relevant Product in Mexico or Canada and, accordingly, did not 

attempt to sell any Mexican or Canadian Imported Relevant Product to any ARRA Waterworks 

Project. After reasonable inquiry, McWane lacks sufficient information at this time to admit or 

deny whether any third parties sold Imported Relevant Product that was Manufactured in Mexico 

or Canada for use in any ARRA Waterworks Project 

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7. The ARRA increased the number of Waterworks Projects being built, repaired or 

otherwise commissioned in the United States. 

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RESPONSE: 

McWane has no first hand knowledge regarding the total number of Waterworks Projects 

that were built, repaired or otherwise commissioned in the United States after the passage of 

ARRA. McWane was not the builder, repairer or commissioner of any Waterworks Projects, but 

only a supplier of fittings to distributors, who then sold fittings for the various Waterworks 

Projects. On information and belief, McWane generally admits that the total number of 

Waterworks Projects being built, rep.aired or otherwise commissioned in the United States 

increased during the period that ARRA funding was available. 

8. Respondent competed for sales of Domestic Relevant Product for use in ARRA 

Waterworks Projects after February 2010. 

RESPONSE: 

Admitted. 

9. Respondent continues to compete for sales of Domestic Relevant Product for use 

in ARRA Waterworks Projects today. 

RESPONSE: 

Denied. McWane has no first hand knowledge of any ARRA funding available today 

and, accordingly, McWane is not competing for sales of Domestic Relevant Product in ARRA 

Waterworks Projects today. The record contains additional testimony consistent with McWane's 

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understanding. 

10. The only Persons that currently Manufacture a Full-Line of Domestic Relevant 

Product that is 24" in diameter or smaller are Respondent and Star. 

RESPONSE: 

Admitted. 

11. Respondent is unaware of any Person that has Plans to begin Manufacturing 

Domestic Relevant Product that is 24" in diameter or smaller within the next two years. 

RESPONSE: 

Admitted. 

12. Prior to Star's entry in 2009 when it began Manufacturing Domestic Relevant 

Product, Respondent was the only Manufacturer of Full-Line of Domestic Relevant Product that 

was 24" in diameter or smaller. 

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RESPONSE: 

Admitted insofar as prior to Star's entry, McWane was the only manufacturer of a full 

line of Domestic Relevant Product in 2008 and 2009. At times prior to that, a number of other 

manufacturers sold a full line of Domestic Relevant Product, including U.S. Pipe, ACIPCO, and 

Griffin Pipe. 

15. Imported Relevant Products are not a substitute for Domestic Relevant Products 

when the specification for a Waterworks Project has a Buy American requirement. 

RESPONSE: 

Denied. See, e.g., 74 Federal Register, No. 104 (June 2, 2009) 26398-99 (national waiver 

exempting from the Buy American requirement components that comprised less than 5% of the 

total cost of materials incorporated into a project); 74 Federal Register No. 152 (August 10, 

2009) 39959-60 (same); 

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"Tracking the De Minimis Waiver", available at 

http://dec.alaska.gov/water/muniloan/pdfslDe%20Minimis%20waiver%20tracking%20and%20e 

xample.pdf, (last accessed June 28, 2012). 

17. When a regulation, code or statute requires Domestic Relevant Products be used 

for publicly funded Waterworks Projects, Imported Relevant Products generally cannot be used 

for those projects. 

RESPONSE: 

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McWane did not attempt to sell Imported Relevant Products under the circumstances of 

this Request and thus has no first-hand knowledge of the prevalence of Imported Relevant 

Products being used for publicly funded Waterworks Projects. After reasonable inquiry, 

McWane lacks sufficient information at this time to determine the circumstances under which 

Imported Relevant Products sold by third parties were sold and whether they were "generally" 

used as described in this Request. By way of further response, McWane incorporates by 

reference its supplemental responses to Request Nos. 1 through 6 above, which show examples 

of non-domestic fittings being used for publicly funded Waterworks Projects, and its response to 

Request No. 16. 

18. Respondent has historically offered less Job Pricing on its Domestic Relevant 

Product than its Imported Relevant Product. 

RESPONSE: 

Admitted in part, but only insofar as follows: The number of waterworks projects 

utilizing domestically manufactured fittings is significantly smaller than the number of projects 

with open specifications. Most of the witnesses estimated that 20-25% or less of all projects 

used domestic fittings. It is unclear, as the term "less" is not defined, whether this Request seeks 

absolute or relative information. Because McWane's domestic tons sold are a small fraction of 

the amount of Imported tons sold, McWane believes that on an absolute basis, it has offered 

fewer total job prices on projects with domestic only specifications than it has offered on projects 

with open specifications. McWane does not have sufficient information to admit or deny this 

request on a comparative or relative percentage basis or price basis. 

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22. The Relevant Product represents five percent (5%) or less of the cost of a typical 

Waterworks Project. 

RESPONSE: 

Admitted. 

33. Distributors need access to a Full-Line of Domestic Relevant Product that can be 

delivered in a timely fashion, i. e. generally less than 12 weeks. 

RESPONSE: 

After reasonable inquiry, McWane lacks sufficient information to admit or deny whether 

third party distributors "generally" need access to a full line of products delivered within 12 

weeks. There are hundreds of distributors whose requirements vary state by state and job by job. 

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37. Respondent does not assert a free-riding justification for its Exclusive Dealing 

Arrangements. 

RESPONSE: 

Denied. McWane's Answer, IH testimony, and expert report make clear that McWane 

intends to assert a "free-riding" justification. See McWane's Answer at 9 ("The alleged conduct 

has substantial pro-competitive justifications and benefits consumers and the public interest"); 

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38. The MDA between Respondent and Sigma did not lower the price of Domestic 

Relevant Product. 

RESPONSE: 

After reasonable inquiry, McWane lacks sufficient information to admit or deny this 

Request as stated. 

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40. Sigma, Star and Respondent together account for 90% or more of the sales in 

Imported Relevant Product in the United Stat~s.

RESPONSE:
 

Admitted.
 

42. In 2008, Respondent, Sigma and Star sold Imported Relevant Product pursuant to 

nearly identical list prices. 

RESPONSE:
 

Denied.
 

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43. In 2008, Respondent, Sigma and Star sold Imported Relevant Product pursuant to 

nearly identical multiplier maps. 

RESPONSE: 

Denied. 

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48. Respondent did not use data obtained from the DIFRA Information Exchange to 

manage its inventory. 

RESPONSE: 

Denied. 

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49. Respondent did not use data obtained from the DIFRA Information Exchange to 

manage its production schedules. 

RESPONSE: 

Denied. 

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50. Respondent did not use data obtained from the DIFRA Information Exchange to 

reduce its costs. 

RESPONSE: 

Denied. 

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OF COUNSEL: 

Joseph A. Ostoyich 

William C. Lavery 

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 

andreas.stargard@bakerbotts.com 

J. Alan Truitt 

Thomas W. Thagard, III 

Julie S. Elmer 

Maynard, Cooper & Gale, P.C. 

1901 Sixth Avenue North 

2400 AmSouthIHarbert Plaza 

Birmingham, AL 35203-2608 

(205) 254-1000 

(205) 254-1999 (facsimile) 

atruitt@maynardcooper.com 

tthagard@maynardcooper.com 

jelmer@maynardcooper.com 

PUBLIC 

/s/ Joseph A. Ostoyich 

Joseph A. Ostoyich 

One ofthe Attorneys for McWane, Inc. 

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CERTIFICATE OF SERVICE 

I hereby certify that on July 19,2012, 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-113
 

Washington, DC 20580
 

I also certify that I delivered via hand delivery a copy of the foregoing document to: 

The Honorable D. Michael Chappell
 

Administrative Law Judge
 

Federal Trade Commission
 

600 Pennsylvania Ave., NW, Rm. H-110
 

Washington, DC 20580
 

I further certify that I delivered via electronic mail a copy of the 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.
 

1. Alexander Ansaldo, Esq.
 

Andrew K. Mann, Esq.
 

By:	 lsi William C. Lavery 

William C. Lavery 

Counsel for McWane, Inc. 

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