UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

COMMISSIONERS: Edith Ramirez, Chairwoman 

 Julie Brill 

 Maureen K. Ohlhausen 

 Joshua D. Wright 

In the Matter of 

MCWANE, INC., 

 a corporation, and Docket No. 9351 

STAR PIPE PRODUCTS, LTD. 

 a limited partnership. 

FINAL ORDER 

The Commission has heard this matter upon the appeals of Respondent and Complaint 

Counsel from the Initial Decision, and upon briefs and oral argument in support thereof and in 

opposition thereto. For the reasons stated in the accompanying Opinion of the Commission, the 

Commission has determined to dismiss Counts 1, 2, 4, 5, and 7 of the Complaint in this 

proceeding and issue an order to cease and desist in disposition of Count 6. The Initial Decision 

dismissed Count 3; that ruling was neither appealed nor placed on the Commission’s docket for 

review, and the dismissal of Count 3 consequently became the Commission’s final decision. 16 

C.F.R. § 3.51(a). Accordingly, 

IT IS ORDERED that Counts 1, 2, 4, 5, and 7 of the Complaint issued in this proceeding 

be, and hereby are, dismissed. 

IT IS FURTHER ORDERED that the following Order to cease and desist be, and it 

hereby is, entered: 

ORDER 

I. 

IT IS ORDERED that, as used in this Order, the following definitions shall apply: 

A. “Commission” means the Federal Trade Commission. 

B. “Respondent” means McWane, Inc., its officers, directors, employees, agents, 

representatives, successors, and assigns; and the United States based subsidiaries, 
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divisions, groups, and affiliates controlled by it, and the respective officers, directors, 

employees, agents, representatives, successors, and assigns of each. 

C. “Competitor” means Respondent and any person that, for the purpose of sale, or 

resale within the United States: (1) manufactures DIPF or Domestic DIPF; (2) causes 

DIPF or Domestic DIPF to be manufactured; or (3) imports DIPF. 

D. “Customer” means any person that purchases any DIPF from Respondent. 

E. “Designated Manager” means the Executive Vice President, General Manager, 

National Sales Manager, Pricing Coordinator, Regional Manager, or the OEM 

Manager for sales of DIPF in and into the United States, and any employee 

performing any job function relating to the setting of Prices (including offering any 

discounts) for DIPF sold in or into the United States. 

F. “Domestic DIPF” means DIPF that is manufactured in the United States of America. 

G. “Ductile Iron Pipe Fittings” or “DIPF” means any iron casting produced in 

conformity with the C153/A21 or C110/A21 standards promulgated by the American 

Water Works Association, including all revisions and amendments to those standards 

and any successor standards incorporating the C153/A21 or C110/A21 standards by 

reference. 

H. “Exclusivity” or “Exclusive” means any requirement, whether formal or informal, or 

direct or indirect, by the Respondent that a Customer purchase all of their Domestic 

DIPF from Respondent, or any other requirement that a Customer restrain, refrain 

from, or limit its future purchases of Domestic DIPF from any Competitor. 

PROVIDED, HOWEVER, that the terms “Exclusivity” or “Exclusive” do not: 

a. apply to Respondent’s sales of non-Domestic DIPF or any product other than 

Domestic DIPF; and 

b. apply to individual bids of Domestic DIPF for specific jobs or refer to the sale 

by Respondent to a Customer of any specified number of units during any 

term, without more. For the avoidance of doubt, the fact that a Customer 

purchases its full requirements of Domestic DIPF from Respondent does not 

establish that Respondent has engaged in Exclusivity and is not prohibited by 

this Order unless the Customer does so because Respondent imposes a 

requirement of Exclusivity. 

I. “Person” means any natural person or artificial person, including, but not limited to, 

any corporation, unincorporated entity, or government. For the purpose of this Order, 

any corporation includes the subsidiaries, divisions, groups, and affiliates controlled 

by it. 

 
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J. “Price” means the retail or wholesale price, resale price, purchase price, list price, 

multiplier price, job price, credit term, freight term, delivery term, service term, or 

any other monetary term defining, setting forth, or relating to the money, 

compensation, or service paid by a Customer to Respondent, or received by a 

Customer in connection with the purchase or sale of DIPF or Domestic DIPF. 

K. “Retroactive Incentive” means any flat or lump-sum payment of monies or any other 

item(s) of pecuniary value to a customer based upon the Customer’s sales or 

purchases of Respondent’s Domestic DIPF reaching a specified threshold (in units, 

revenues, or any other measure), or otherwise reducing the Price of one unit of 

Respondent’s Domestic DIPF because of the purchase or sale of an additional unit of 

that product. This definition excludes discounts or providing other item of pecuniary 

value to a customer based upon sales or purchases of Domestic DIPF beyond a 

specified threshold. 

a. By way of example, Respondent may offer or provide a discount of X% on all 

sales of Domestic DIPF in excess of Y units, but it may not offer or provide a 

discount of X% on all units of Domestic DIPF if sales exceed Y units. 

L. “Service” means any service, assistance or other support provided by Respondent to a 

Customer, including without limitation, responsiveness to requests for bids, 

responsiveness in filling purchase orders, product availability, handling of warranty 

claims, and handling of returns. 

II. 

IT IS FURTHER ORDERED that in connection with the business of manufacturing, 

marketing or selling Domestic DIPF in or affecting commerce, as “commerce” is defined in 

Section 4 of the Federal Trade Commission Act, 15 U.S.C. § 44, Respondent shall cease and 

desist from, either directly or indirectly, or through any corporate or other device: 

A. Inviting, entering into, adhering to, maintaining, implementing, enforcing, or 

attempting thereto any condition, policy, practice, agreement, contract, or 

understanding that requires Exclusivity with a Customer, including but not limited to: 

1. Conditioning the sale or purchase of any product, including Respondent’s 

Domestic DIPF, on a Customer’s Exclusivity; 

2. Conditioning any term of Price or Service offered or provided by Respondent 

to a Customer relating to any product, including Respondent’s Domestic 

DIPF, on a Customer’s Exclusivity; 

3. Conditioning any term of Price or Service offered or provided to a Customer 

based upon a requirement that the Customer purchase 50% or more of its 

purchases (in units, revenues, or any other measure) of Domestic DIPF from 

Respondent over any period of time; and 
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4. Conditioning any term of Price or Service offered or provided to a Customer 

relating to any product marketed by Respondent upon that Customer’s 

purchases or sales of Respondent’s Domestic DIPF. 

B. For ten (10) years from the date this Order becomes final, inviting, entering into, 

adhering to, maintaining, implementing, enforcing, or attempting thereto any 

condition, policy, practice, agreement, contract, or understanding that offers or 

provides any Retroactive Incentive. 

C. Discriminating against, penalizing, or otherwise retaliating against any Customer, for 

the reason, in whole or in part, that the Customer engaged in, or intends to engage in, 

the distribution, purchase or sale of a Competitor’s Domestic DIPF, or otherwise 

refuses to enter into or continue any condition, agreement, contract, or understanding 

that requires Exclusivity. Examples of prohibited discrimination or retaliation against 

a Customer shall include, but not be limited to: 

1. Terminating, suspending, or threatening or proposing thereto, sales of any 

product marketed by the Respondent to the Customer; 

2. Auditing the Customer’s purchases or sales of Domestic DIPF to determine 

the extent of purchases or sales of competing Domestic DIPF; 

3. Withdrawing or modifying, or threatening or proposing thereto, any terms of 

Price or Service offered or provided by Respondent to a Customer relating to 

any product marketed by Respondent; and 

4. Refusing to deal with a Customer on terms and conditions generally available 

to other Customers. 

D. After ninety (90) days from the date this Order becomes final, from enforcing any 

condition, requirement, policy, agreement, contract or understanding that is 

inconsistent with the terms of this Order. 

PROVIDED, HOWEVER, that nothing in Paragraphs II A-D of this Order prohibits 

Respondent from providing discounts, rebates, or other Price or non-Price incentives to 

purchase Domestic DIPF that are (i) volume-based, above average variable cost, and not 

Retroactive Incentives as defined herein; or (ii) designed to meet competition, if 

Respondent determines in good faith that one or more Competitors are offering terms of 

sale for their Domestic DIPF that Respondent needs to match in order to win contested 

business. 

PROVIDED, FURTHER, that nothing in Paragraph II.D of this Order prohibits 

Respondent from honoring or providing discounts, rebates, or other Price or non-Price 

incentives to purchase its Domestic DIPF that a Customer contracted for prior to the date 

this Order becomes final even if paid or provided by Respondent subsequent to that date. 
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III. 

IT IS FURTHER ORDERED that Respondent shall: 

A. Within sixty (60) days from the date this Order becomes final distribute by first-class 

mail, return receipt requested, or by electronic mail with return confirmation, a copy 

of this Order with the Complaint, to each of its officers, directors, and Designated 

Managers; 

B. Within sixty (60) days from the date this Order becomes final, distribute by first-class 

mail, return receipt requested, or by electronic mail with return confirmation, a copy 

of this Order with the Complaint, to each Customer of Respondent that has purchased 

DIPF or Domestic DIPF at any time since September 1, 2012; 

C. For ten (10) years from the date this Order becomes final, distribute by first-class 

mail, return receipt requested, or by electronic mail with return confirmation, a copy 

of this Order with the Complaint, within sixty (60) days, to each Person who becomes 

its officer, director, or Designated Manager and who did not previously receive a 

copy of this Order and Complaint; and 

D. Require each person to whom a copy of this Order is furnished pursuant to 

Paragraphs III.A and III.C of this Order to sign and submit to Respondent within sixty 

(60) days of the receipt thereof a statement that: (1) represents that the undersigned 

has read and understand the Order; and (2) acknowledges that the undersigned has 

been advised and understands that non-compliance with the Order may subject 

Respondent to penalties for violation of the Order. 

IV. 

IT IS FURTHER ORDERED that Respondent shall file verified written reports within 

ninety (90) days from the date this Order becomes final, annually thereafter for ten (10) years on 

the anniversary of the date this Order becomes final, and at such other times as the Commission 

may by written notice require. Each report shall include, among other information that may be 

necessary: 

A. Copies of the signed return receipts or electronic mail with return confirmations 

required by Paragraphs III.A-D of this Order; 

B. A detailed description of the manner and form in which Respondent has complied and 

is complying with this Order. 

 
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V. 

IT IS FURTHER ORDERED that Respondent shall notify the Commission: 

A. Of any change in its principal address within twenty (20) days of such change in 

address; and 

B. At least thirty (30) days prior to any proposed: (1) dissolution of Respondent; (2) 

acquisition, merger, or consolidation of Respondent; or (3) any other change in 

Respondent including, but not limited to, assignment and the creation or dissolution 

of subsidiaries, if such change might affect compliance obligations arising out of this 

Order. 

VI. 

IT IS FURTHER ORDERED that, for the purpose of determining or securing 

compliance with this Order, Respondent shall permit any duly authorized representative of the 

Commission: 

A. Access, during office hours of Respondent, and in the presence of counsel, to all 

facilities and access to inspect and copy all books, ledgers, accounts, correspondence, 

memoranda, and all other records and documents in the possession, or under the 

control, of Respondent relating to compliance with this Order, which copying 

services shall be provided by Respondent at its expense; and 

B. Upon fifteen (15) days notice, and in the presence of counsel, and without restraint or 

interference from it, to interview officers, directors, or employees of Respondent. 

VII. 

IT IS FURTHER ORDERED that this Order shall terminate twenty (20) years from the 

date it becomes final. 

By the Commission. 

 Donald S. Clark 

 Secretary 

SEAL: 

ISSUED: January 30, 2014