[Federal Register Volume 63, Number 126 (Wednesday, July 1, 1998)]
[Notices]
[Pages 35946-35954]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-17504]


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DEPARTMENT OF JUSTICE

Antitrust Division
[Civil Action No. 98-1497]


Proposed Final Judgment and Competitive Impact Statement; United 
States v. Aluminum Company of America, et al.

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. section 16(b)-(h), that a proposed Final 
Judgment, Hold Separate Stipulation and Order, Stipulation and Order, 
and Competitive Impact Statement have been filed with the United States 
District Court for the District of Columbia in United States v. 
Aluminum of America, et. al., Civil No. 1:98CV01497. The proposed Final 
Judgment is subject to approval by the Court after the expiration of 
the statutory 60-day public comment period and compliance with the 
Antitrust Procedures and Penalties Act, 15 U.S.C. section 16(b)-(h).
    On June 15, 1998, the United States filed a Complaint seeking to 
enjoin a transaction in which Aluminum Company of America (``Alcoa'') 
would acquire Alumax, Inc. (``Alumax''). Alcoa and Alumax are the two 
largest of three producers of aluminum cast plate (``cast plate'') in 
the world. Cast plate is used for applications that require precise 
dimensions and flatness, such as jigs, fixtures, and numerous tooling, 
mold, machinery, and equipment applications. Alcoa's proposed 
acquisition of Alumax would have combined under single ownership almost 
90% of the cast plate manufacturing business in the world. The 
Complaint alleged that the proposed acquisition would substantially 
lessen competition in the manufacture and sale of cast plate worldwide 
in violation of Section 7 of the Clayton Act, 15 U.S.C. section 18.
    The proposal Final Judgment, filed at the same time as the 
Complaint, orders Alcoa to sell its cast plate division to a purchaser 
who has the capability to compete effectively in the manufacture and 
sale of cast plate. The proposed Final Judgment also requires Alcoa to 
abide by the Hold Separate Stipulation and Order, which requires Alcoa 
to ensure that, until the divestiture mandated by the Final Judgment 
has been accomplished, Alcoa's cast plate division will be held 
separate and apart from, and operated independently of, any of Alcoa's 
other assets and businesses. A Competitive Impact Statement filed by 
the United States describes the Complaint, the proposed Final Judgment, 
and remedies to private litigants.
    Public comment is invited within the statutory 60-day comment 
period. Such comments, and responses thereto, will be published in the 
Federal Register and filed with the Court. Written comments should be 
directed to Roger W. Fones, Chief, Transportation, Energy, and 
Agriculture Section, Antitrust Division, 325 Seventh Street, NW., Suite 
500, Washington, DC 20530 (telephone: (202) 307-6351).
    Copies of the Complaint, Hold Separate Stipulation and Order, 
Stipulation and Order, proposed Final Judgment, and Competitive Impact 
Statement are available for inspection in Room 215 of the U.S. 
Department of Justice, Antitrust Division, 325 Seventh Street, NW, 
Washington, DC 20530 (telephone: (202) 514-2481) and at the office of 
the Clerk of the United States District Court for the District of 
Columbia, 333 Constitution Avenue, NW, Washington, DC 20001. Copies of 
any of these materials may be obtained upon request and payment of a 
copying fee.
Constance K. Robinson,
Director of Operations & Merger Enforcement, Antitrust Division.

Stipulation and Order

    It is hereby Stipulated by and between the undersigned parties, by 
their respective attorneys, as follows:
    1. The Court has jurisdiction over the subject matter of this 
action and over each of the parties hereto, and venue of this action is 
proper in the United States District Court for the District of 
Columbia.
    2. The parties stipulate that a Final Judgment in the form hereto 
attached may be filed and entered by the Court, upon the motion of any 
party or upon the Court's own motion, at any time after compliance with 
the requirements of the Antitrust Procedure and Penalties Act (15 
U.S.C. 16), and without further notice to any party or other 
proceedings, provided that plaintiff has not withdrawn its consent, 
which it may do at any time before the entry of the proposed Final 
Judgment by serving notice thereof on defendants and by filing that 
notice with the Court.

[[Page 35947]]

    3. Defendants shall abide by and comply with the provisions of the 
proposed Final Judgment pending entry of the Final Judgment by the 
Court, or until expiration of time for all appeals of any Court ruling 
declining entry of the proposed Final Judgment, and shall, from the 
date of the signing of this Stipulation by the parties, comply with all 
the terms and provisions of the proposed Final Judgment as though they 
were in full force and effect as an order of the Court.
    4. This Stipulation shall apply with equal force and effect to any 
amended proposed Final Judgment agreed upon in writing by the parties 
and submitted to the Court.
    5. In the event that plaintiff withdraws its consent, as provided 
in paragraph 2 above, or in the event that the proposed Final Judgment 
is not entered pursuant to this Stipulation, the time has expired for 
all appeals of any Court ruling declining entry of the proposed Final 
Judgment, and the Court has not otherwise ordered continued compliance 
with the terms and provisions of the proposed Final Judgment, then the 
parties are released from all further obligations under this 
Stipulation, and the making of this Stipulation shall be without 
prejudice to any party in this or any other proceeding.
    6. Defendants represent that the divestiture ordered in the 
proposed Final Judgment can and will be made, and that the defendants 
will later raise no claims of hardship of difficulty as grounds for 
asking the Court to modify any of the divestiture provisions contained 
therein. Respectfully submitted.

    For Plaintiff United States of America;
Nina B. Hale,
Washington Bar #18776
Andrew K. Rosa,
Hawaii Bar #6366, Attorneys, Antitrust Division, U.S. Department of 
Justice, 325 Seventh St., N.W., Washington, DC 20004, (202) 307-6316, 
(202) 307-0886.
    Dated: June 15, 1998.

    For Defendant Aluminum Company of America:
Mark Leddy,
DC Bar #404833,
David I. Gelfand,
DC Bar #416596,
Steven J. Kaiser,
DC Bar #454251,
Cleary, Gottlieb, Steen & Hamilton,
2000 Pennsylvania Avenue, N.W., Washington, DC 20006 (202) 974-1500.

    For Defendant Alumax Inc.:
Robert P. Wolf,
Virginia Bar #1299,
Alumax Inc.,
3424 Peachtree Road, N.E., Suite 2100, Atlanta, GA 30326, (404) 846-
4651.

Order

    It is So ordered, this ________ day of ________, 1998.
----------------------------------------------------------------------
United States District Court Judge

Hold Separate Stipulation and Order

    It is hereby Stipulated by and between the undersigned parties, 
subject to approval and entry by the Court, that:

I

Definitions

    As used in this Hold Separate Stipulation and Order:
    A. Alcoa means defendant Aluminum Company of America, a 
Pennsylvania Corporation with its headquarters in Pittsburgh, 
Pennsylvania, and its successors, assigns, subsidiaries, divisions, 
groups, affiliates, partnerships and joint ventures, and directors, 
officers, managers, agents, and employees.
    B. Alumax means Alumax Inc., a Delaware Corporation with its 
headquarters in Atlanta Georgia, and its successors, assigns, 
subsidiaries, divisions, groups, affiliates, partnerships and joint 
ventures, and directors, officers, managers, agents, and employees.
    C. Alcoa Cast Plate Division means all assets included within the 
cast plate operation of Alcoa's Aerospace and Commercial Rolled 
Products Division as of the date hereof, including:
    1. all tangible assets, including the cast plate manufacturing 
facility located at 1551 Alcoa Avenue, Vernon, California 90058 
(``Vernon facility'') and the portion of the real property on which the 
Vernon facility is situated that is reasonably necessary for operation 
of the Vernon cast plate plant; any facilities used for research and 
development activities; Vernon offices; cast plate-related 
manufacturing assets including capital equipment, vehicles, interests, 
supplies, personal property, inventory, office furniture, fixed assets 
and fixtures, materials, on-site warehouses or storage facilities, and 
other tangible property or improvements used in the cast plate 
operation; all licenses, permits and authorizations issued by any 
governmental organization relating to the cast plate operation; all 
contracts, agreements, leases, commitments and understandings 
pertaining to the cast plate operation; supply agreements; all customer 
lists, contracts, accounts, and credit records; and other records 
maintained by Alcoa in connection with the cast plate operation;
    2. all intangible assets, including but not limited to all patents, 
licenses and sublicenses, intellectual property, trademarks, trade 
names, service marks, service names (except to the extent such 
trademarks, trade names, service marks, and service names contain the 
name ``Alcoa''), technical information, know-how, trade secrets, 
drawings, blueprints, designs, design protocols, specifications for 
materials, specifications for parts and devices, safety procedures for 
the handling of materials and substances, quality assurance and control 
procedures, design tools and simulation capability, and all manuals and 
technical information Alcoa provides to its own employees, customers, 
suppliers, agents or licensees; and
    3. all research data concerning historic and current research and 
development efforts relating to the cast plate operation, including 
designs of experiments, and the results of unsuccessful designs and 
experiments.
    D. Cast Plate means an aluminum plate product manufactured by 
casting or by sawing cast slab purchased from an external source, 
ranging in gauges from \1/4\ inch to 30 inches, that is used for 
various tooling, industrial and mold plate applications, and that is 
manufactured by the Alcoa Cast Plate Division.

II

Objectives

    The Final Judgment filed in this case is meant to ensure Alcoa's 
prompt divestiture of the Alcoa Cast Plate Division for the purpose of 
maintaining a viable competitor in the manufacture and sale of Cast 
Plate to remedy the effects that the United States alleges would 
otherwise result from Alcoa's proposed acquisition of Alumax.
    This Hold Separate Stipulation and Order ensures, prior to such 
divestiture, that the Alcoa Cast Plate Division which is being divested 
be maintained as an independent, economically viable, ongoing business 
concern, and that

[[Page 35948]]

competition is maintained during the pendency of the divestiture.

III

Hold Separate Provisions

    Until the divestiture required by the Final Judgment has been 
accomplished:
    A. Alcoa shall preserve, maintain, and operate the Alcoa Cast Plate 
Division as an independent competitor with management, research, 
development, production, sales and operations held entirely separate, 
distinct and apart from those of Alcoa. Alcoa shall not coordinate the 
manufacture, marketing or sale of products from Alcoa Cast Plate 
Division's business with the Cast Plate business that Alcoa will own as 
a result of the acquisition of Alumax. Within twenty (20) calendar days 
of the filing of the Complaint in this matter, Alcoa will inform 
plaintiff of the steps taken to comply with this provision.
    B. Alcoa shall take all steps necessary to ensure that the Alcoa 
Cast Plate Division will be maintained and operated as an independent, 
ongoing, economically viable and active competitor in Cast Plate 
manufacture and sale; that the management of the Alcoa Cast Plate 
Division will not be influenced by Alcoa, and that the books, records, 
competitively sensitive sales, marketing and pricing information, and 
decision-making associated with the Alcoa Cast Plate Division will be 
kept separate and apart from the operations of Alcoa. Alcoa's influence 
over the Alcoa Cast Plate Division shall be limited to that necessary 
to carry out Alcoa's obligations under this Order and the Final 
Judgment. Alcoa may receive historical aggregate financial information 
(excluding capacity or pricing information) relating to the Alcoa Cast 
Plate Division to the extent necessary to allow Alcoa to prepare 
financial reports, tax returns, personnel reports, and other necessary 
or legally required reports.
    C. Alcoa shall use all reasonable efforts to maintain Cast Plate 
manufacturing at the Alcoa Cast Plate Division, and shall maintain at 
current or previously approved levels, whichever are higher, internal 
research and developing funding, promotional, advertising, sales, 
technical assistance, marketing and merchandising support for the Alcoa 
Cast Plate Division.
    D. Alcoa shall provide and maintain sufficient working capital to 
maintain the Alcoa Cast Plate Division as an economically viable, 
ongoing business.
    E. Alcoa shall provide and maintain sufficient lines and sources of 
credit to maintain the Alcoa Cast Plate Division as an economically 
viable, ongoing business.
    F. Alcoa shall take all steps necessary to ensure that the Vernon 
facility is fully maintained in operable condition at no lower than its 
current rated capacity, and shall maintain and adhere to normal repair 
and maintenance schedules for the Alcoa Cast Plate Division.
    G. Alcoa shall not, except as part of a divestiture approved by 
plaintiff, remove, sell, lease, assign, transfer, pledge or otherwise 
dispose of or pledge as collateral for loans, any assets of the Alcoa 
Cast Plate Division, including intangible assets that relate to the 
permits described in Section II of the Final Judgment.
    H. Alcoa shall maintain, in accordance with sound accounting 
principles, separate, true, accurate and complete financial ledgers, 
books and records that report, on a periodic basis, such as the last 
business day of every month, consistent with past practices, the 
assets, liabilities, expenses, revenues, incomes, profit and loss of 
the Alcoa Cast Plate Division.
    I. Until such time as the Alcoa Cast Plate Division is divested, 
except in the ordinary course of business or as is otherwise consistent 
with this Hold Separate Agreement, Alcoa shall not hire and defendant 
shall not transfer or terminate, or alter, to the detriment of any 
employee, any current employment or salary agreements for any Alcoa 
employees who on the date of the signing of this Agreement (i) work in 
the Alcoa Cast Plate Division, or (ii) are members of management 
referenced in Section III(J) of this Order unless such individual has a 
written offer of employment from a third party for a like position.
    J. Until such time as the Alcoa Cast Plate Division is divested, 
the assets to be divested shall be managed by John Hogarth. John 
Hogarth shall have complete managerial responsibility for the Alcoa 
Cast Plate Division, subject to the provisions of this Order and the 
Final Judgment. In the event that John Hogarth is unable to perform his 
duties, Alcoa shall appoint, subject to plaintiff's approval, a 
replacement acceptable to plaintiff within ten (10) working days. 
Should Alcoa fail to appoint a replacement acceptable to plaintiff 
within ten (10) working days, plaintiff shall appoint a replacement.
    K. Alcoa shall take no action that would interfere with the ability 
of any trustee appointed pursuant to the Final Judgment to complete the 
divestiture pursuant to the Final Judgment to a suitable purchaser.
    L. This Hold Separate Stipulation and Order shall remain in effect 
until the divestiture required by the Final Judgment is complete, or 
until further Order of the Court.

Respectfully submitted,
    For Plaintiff, United States of America:
Nina B. Hale,
Washington Bar #18776,
Andrew K. Rosa,
Hawaii Bar #6366, Attorneys, Antitrust Division, U.S. Department of 
Justice, 325 Seventh St., N.W., Washington, DC 20004, (202) 307-6316, 
(202) 307-0886.
    Dated: June 15th, 1998.
    For Defendant, Aluminum Company of America:
Mark Leddy,
DC Bar #404833,
David I. Gelfand,
DC Bar #416596,
Steven J. Kaiser,
DC Bar #454251,
Cleary, Gottlieb, Steen & Hamilton,
2000 Pennsylvania Avenue, N.W., Washington, DC 20006, (202) 974-1500.
    For Defendant Alumax Inc.:
Robert P. Wolf,
Virginia Bar #1299, Alumax Inc., 3424 Peachtree Road, N.E., Suite 2100, 
Atlanta, GA 30326, (404) 846-4651.

Order

    It is So Ordered, this ________ day of ________, 1998.
----------------------------------------------------------------------
United States District Judge

Final Judgment

    Whereas, plaintiff, the United States of America (``United 
States''), filed its complaint in this action on June 15, 1998, and 
plaintiff and defendants, Aluminum Company of America (``Alcoa'') and 
Alumax Inc. (``Alumax''), by their respective attorneys, having 
consented to the entry of this Final Judgment without trial or 
adjudication of any issue of fact or law herein, and without this Final 
Judgment constituting any evidence against or an admission by any party 
with respect to any issue of law or fact herein;
    And whereas, defendants have agreed to be bound by the provisions 
of this Final Judgment pending its approval by the Court;
    And whereas, the essence of this Final Judgment is the prompt and 
certain divestiture of the Alcoa Cast Plate Division to assure that 
competition is not substantially lessened;
    And whereas, plaintiff requires defendants to make certain 
divestitures for the purpose of remedying the loss of competition 
alleged in the Complaint;
    And whereas, defendants have represented to plaintiff that the 
divestiture ordered herein can and will be made and that defendants 
will later raise no claims of hardship or difficulty

[[Page 35949]]

as grounds for asking the Court to modify any of the divestiture or 
contract provisions contained below;
    Now, therefore, before the taking of any testimony, and without 
trial or adjudication of any issue of fact or law herein, and upon 
consent of the parties hereto, it is hereby Ordered, Adjudged, and 
decreed as follows:

I

Jurisdiction

    This Court has jurisdiction over the subject matter of this action 
and over each of the parties hereto. The Complaint states a claim upon 
which relief may be granted against the defendants, as hereinafter 
defined, under Section 7 of the Clayton Act, as amended (15 U.S.C. 18).

II

Definitions

    As used in this Final Judgment:
    A. Alcoa means defendant Aluminum Company of America, a 
Pennsylvania Corporation with its headquarters in Pittsburgh, 
Pennsylvania, and its successors, assigns, subsidiaries, divisions, 
groups, affiliates, partnerships and joint ventures, and directors, 
officers, managers, agents, and employees.
    B. Alumax means Alumax Inc., a Delaware Corporation with its 
headquarters in Atlanta, Georgia, and its successors, assigns, 
subsidiaries, divisions, groups, affiliates, partnerships and joint 
ventures, and directors, officers, managers, agents, and employees.
    C. Alcoa Cast Plate Division means all assets included within the 
cast plate operation of Alcoa's Aerospace and Commercial Rolled 
Products Division as of the date hereof, including:
    1. all tangible assets, including the cast plate manufacturing 
facility located at 1551 Alcoa Avenue, Vernon, California 90058 
(``Vernon facility'') and the portion of the real property on which the 
Vernon facility is situated that is reasonably necessary for operation 
of the Vernon cast plate plant: any facilities used for research and 
development activities; Vernon offices; cast plate-related 
manufacturing assets including capital equipment, vehicles, interests, 
supplies, personal property, inventory, office furniture, fixed assets 
and fixtures, materials, on-site warehouses or storage facilities, and 
other tangible property or improvements used in the cast plate 
operation; all licenses, permits and authorizations issued by any 
governmental organization relating to the cast plate operation; all 
contracts, agreements, leases, commitments and understandings 
pertaining to the cast plate operation; supply agreements; all customer 
lists, contracts, accounts, and credit records, and other records 
maintained by Alcoa in connection with the cast plate operation;
    2. all intangible assets, including but not limited to all patents, 
licenses and sublicenses, intellectual property, trademarks, trade 
names, service marks, service names (except to the extent such 
trademarks, trade names, service marks, and service names contain the 
name ``Alcoa''), technical information, know-how, trade secrets, 
drawings, blueprints, designs, design protocols, specifications for 
materials, specifications for parts and devices, safety procedures for 
the handling of materials and substances, quality assurance and control 
procedures, design tools and simulation capability, and all manuals and 
technical information Alcoa provides to its own employees, customers, 
suppliers, agents or licensees; and
    3. all research data concerning historic and current research and 
development efforts relating to the cast plate operation, including 
designs of experiments, and the results of unsuccessful designs and 
experiments.
    D. ``Cast Plate'' means an aluminum plate product manufactured by 
casting or by sawing cast slab purchased from an external source, 
ranging in gauges from \1/4\ to 30 inches, that is used for various 
tooling, industrial and mold plate applications, and that is 
manufactured by the Alcoa Cast Plate Division.

III

Applicability

    A. The provisions of this Final Judgment apply to Alcoa and Alumax, 
their successor and assigns, their subsidiaries, affiliates, directors, 
officers, managers, agents, and employees, and all other persons in 
active concern or participation with any of them who shall have receive 
actual notice of this Final Judgment by personal service or otherwise.
    B. Alcoa shall require, as a condition of the sale or other 
disposition of all or substantially all of the assets involving Cast 
Plate, that the acquiring party or parties agree to be bound by the 
provisions of this Final Judgment.

IV

Divestiture of Assets

    A. Alcoa is hereby ordered and directed in accordance with the 
terms of this Final Judgment, within one hundred and eighty (180) 
calendar days after the filing of the Complaint in this matter, or five 
(5) days after notice of entry of this Final Judgment by the Court, 
whichever is later, to divest the Alcoa Cast Plate Division as an 
ongoing business to a purchaser acceptable to the United States in its 
sole discretion. With respect to the intangible assets described in 
Section II(C)(2) of this Final Judgment, the divestiture required 
hereunder shall be accomplished by entering into a perpetual, 
nonexclusive license (or licenses, as the case may be) with the 
purchaser, transferable to any future purchaser of the Vernon facility, 
to use, in manufacturing cast plate at the Vernon facility, all such 
intangible assets, wherever located, that have been used in the 
manufacture of cast plate at the Vernon facility.
    B. Alcoa shall use its best efforts to accomplish the divestiture 
as expeditiously and timely as possible. The United States, in its sole 
discretion, may extend the time period for any divestiture by an 
additional period of time not to exceed thirty (30) calendar days.
    C. In accomplishing the divestiture ordered by this Final Judgment, 
Alcoa promptly shall make known, by usual and customary means, the 
availability of the Alcoa Cast Plate Division described in this Final 
Judgment. Alcoa shall inform any person making an inquiry regarding a 
possible purchase that the sale is being made pursuant to this Final 
Judgment and provide such person with a copy of this Final Judgment. 
Alcoa shall also offer to furnish to all prospective purchasers, 
subject to customary confidentiality assurances, all information 
regarding the Alcoa Cast Plate Division customarily provided in a due 
diligence process except such information subject to attorney-client 
privilege or attorney work-product privilege. Alcoa shall make 
available such information to the plaintiff at the same time that such 
information is made available to any other person.
    D. Alcoa shall not interfere with any negotiations by any purchaser 
to employ any Alcoa employee who works at, or whose principal 
responsibility is, the Cast Plate business.
    E. Alcoa shall permit prospective purchasers of the Alcoa Cast 
Plate Division to have reasonable access to personnel and to make such 
inspection of Alcoa Casts Plate's Vernon facility; assess to any and 
all environmental, zoning, and other permit documents and information; 
and access to any and all financial, operational, or other documents 
and information customarily provided as part of a due diligence 
process.
    F. Alcoa shall warrant to the purchaser of the Alcoa Cast Plate

[[Page 35950]]

Division that the Alcoa Cast Plate Division will be operational on the 
date of sale.
    G. Alcoa shall not take any action, direct or indirect, that will 
impede in any way the operation of the Alcoa Cast Plate Division.
    H. Alcoa shall warrant to the purchaser of the Alcoa Cast Plate 
Division that there are no material defects in the environmental, 
zoning, or other permits pertaining to the operation of the Alcoa Cast 
Plate Division and that Alcoa will not undertake, directly or 
indirectly, following the divestiture of the Alcoa Cast Plate Division, 
any challenges to the environmental, zoning, or other permits 
pertaining to the operation of the Alcoa Cast Plate Division.
    I. Alcoa shall not be permitted to locate any of its operations at 
the Alcoa Cast Plate Division's Vernon facility.
    J. Unless the United States otherwise consents in writing, the 
divestiture pursuant to Section IV, or by trustee appointed pursuant to 
Section V of this Final Judgment, shall include the entire Alcoa Cast 
Plate Division, operated in place pursuant to the Hold Separate 
Stipulation and Order, and be accomplished by selling or otherwise 
conveying the Alcoa Cast Plate Division to a purchaser in such a way as 
to satisfy the United States, in its sole discretion, that the Alcoa 
Cast Plate Division can and will be used by the purchaser as part of a 
viable, ongoing business or businesses engaged in the manufacture of 
Cast Plate. The divestiture, whether pursuant to Section IV of Section 
V of this Final Judgment, shall be made to purchaser for whom it is 
demonstrated to the United State's sole satisfaction that: (1) the 
purchaser has the capability and intent of competing effectively in the 
manufacture and sale of Cast Plate; (2) the purchaser has or soon will 
have the managerial, operational, and financial capability to compete 
effectively in the manufacture and sale of Cast Plate; and (3) none of 
the terms of any agreement between the purchaser and Alcoa gives Alcoa 
the ability unreasonably to raise the purchaser's costs, to lower the 
purchaser's efficiency, or otherwise to interfere in the ability of the 
purchaser to compete effectively.

V

Appointment of Trustee

    A. In the event that Alcoa has not divested the Alcoa Cast Plate 
Division within the time specified in Section IV of this Final 
Judgment, the Court shall appoint, on application of the United States, 
a trustee selected by the United States to effect the divestiture of 
the Alcoa Cast Plate Division.
    B. After the appointment of a trustee becomes effective, only the 
trustee shall have the right to sell the Alcoa Cast Plate Division. The 
trustee shall have the power and authority to accomplish the 
divestiture at the best price then obtainable upon a reasonable effort 
by the trustee, subject to the provisions of Sections IV and VI of this 
Final Judgment, and shall have such other powers as the Court shall 
deem appropriate. Subject to Section V(C) of this Final Judgment, the 
trustee shall have the power and authority to hire at the cost and 
expense of Alcoa any investment bankers, attorneys, or other agents 
reasonably necessary in the judgment of the trustee to assist in the 
divestiture, and such professionals and agents shall be accountable 
solely to the trustee. The trustee shall have the power and authority 
to accomplish the divestiture at the earliest possible time to a 
purchaser acceptable to the United States in its sole discretion and 
shall have such other powers as this Court shall deem appropriate. 
Alcoa shall not object to a sale by the trustee on any grounds other 
than the trustee's malfeasance. Any such objections by Alcoa must be 
conveyed in writing to plaintiff and the trustee within ten (10) days 
after the trustee has provided the notice required under Section VI of 
this Final Judgment.
    C. The trustee shall serve at the cost and expense of Alcoa, on 
such terms and conditions as the Court may prescribe, and shall account 
for all monies derived from the sale of the assets sold by the trustee 
and all costs and expenses so incurred. After approval by the Court of 
the trustee's accounting, including fees for its services and those of 
any professionals and agents retained by the trustee, all remaining 
money shall be paid to Alcoa and the trust shall then be terminated. 
The compensation of such trustee and of professionals and agents 
retained by the trustee shall be reasonable in light of the value of 
the divested business and based on a fee arrangement providing the 
trustee with an incentive based on the price and terms of the 
divestiture and the speed with which it is accomplished.
    D. Alcoa shall use it best efforts to assist the trustee in 
accomplishing the required divestiture, including its best efforts to 
effect all necessary regulatory approvals. The trustee and any 
consultants, accountants, attorney, and other persons retained by the 
trustee shall have full and complete access to the personnel, books, 
records, and facilities of the business to be divested, and Alcoa shall 
develop financial or other information relevant to the business to be 
divested customarily provided in a due diligence process as the trustee 
may reasonably request, subject to customary confidentiality 
assurances. Alcoa shall permit bona fide prospective acquirers of the 
Alcoa Cast Plate division to have reasonable access to personnel and to 
make such inspection of physical facilities and any and all financial, 
operational or other documents and other information as may be relevant 
to the divestiture required by this Final Judgment.
    E. After its appointment, the trustee shall file monthly reports 
with the parties and the Court setting forth the trustee's efforts to 
accomplish the divestiture ordered under this Final Judgment; provided 
however, that to the extent such reports contain information that the 
trustee deems confidential, such reports shall not be filed in the 
public docket of the court. Such reports shall include the name, 
address and telephone number of each person who, during the preceding 
month, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry about acquiring, any interest in the business to be divested, 
and shall describe in detail each contact with any such person during 
that period. The trustee shall maintain full records of all efforts 
made to divest the business to be divested.
    F. If the trustee has not accomplished such divestiture within six 
(6) months after its appointment, the trustee thereupon shall file 
promptly with the Court a report setting forth: (1) the trustee's 
efforts to accomplish the required divestiture, (2) the reasons, in the 
trustee's judgment, why the required divestiture has not been 
accomplished, and (3) the trustee's recommendations; provided, however, 
that to the extent such reports contain information that the trustee 
deems confidential, such reports shall not be filed in the public 
docket of the Court. The trustee shall at the same time furnish such 
report to the parties, who shall each have the right to be heard and to 
make additional recommendations consistent with the purpose of the 
trust. The Court shall enter thereafter such orders as it shall deem 
appropriate in order to carry out the purpose of the trust, which may, 
if necessary, include extending the trust and the term of the trustee's 
appointment by a period requested by the United States.

[[Page 35951]]

VI

Notification

    Within two (2) business days following execution of a definitive 
agreement contingent upon compliance with the terms of this Final 
Judgment to effect, in whole or in part, any proposed divestiture 
pursuant to Sections IV and V of this Final Judgment, Alcoa or the 
trustee, whichever is then responsible for effecting the divestiture, 
shall notify plaintiff of the proposed divestiture. If the trustee is 
responsible, it shall similarly notify Alcoa. The notice shall set 
forth the details of the proposed transaction and list the name, 
address, and telephone number of each person not previously identified 
who offered to, or expressed an interest in or a desire to, acquire any 
ownership interest in the business to be divested that is the subject 
of the binding contract, together with full details of same. Within 
fifteen (15) calendar days of receipt by plaintiff of such notice, the 
United States, in its sole discretion, may request for Alcoa, the 
proposed purchaser, or any other third party additional information 
concerning the proposed divestiture and the proposed purchaser. Alcoa 
and the trustee shall furnish any additional information requested from 
them within fifteen (15) calendar days of the receipt of the request, 
unless the parties shall otherwise agree. Within thirty (30) calendar 
days after receipt of the notice or within twenty (20) calendar days 
after the plaintiff has been provided the additional information 
requested from Alcoa, the proposed purchaser, or any third party, 
whichever is later, the United States shall provide written notice to 
Alcoa and the trustee, if there is one, stating whether or not it 
objects to the proposed divestiture. If the United States provides 
written notice to Alcoa and the trustee that it does not object, then 
the divestiture may be consummated, subject only to Alcoa's limited 
right to object to the sale under Section V(B) of this Final Judgment. 
Absent written notice that the United States does not object to the 
proposed purchaser or upon objection by the United States, a 
divestiture proposed under Section IV or Section V shall not be 
consummated. Upon objection by Alcoa under the provision in Section 
V(B), a divestiture proposed under Section V shall not be consummated 
unless approved by the Court.

VII

Affidavitts

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter and every thirty (30) calendar days thereafter until the 
divestiture has been completed whether pursuant to Section IV or 
Section V of this Final Judgment, Alcoa shall deliver to plaintiff an 
affidavit as to the fact and manner of compliance with Section IV or 
Section V of this Final Judgment. Each such affidavit shall include, 
inter alia, the name, address, and telephone number of each person who, 
at any time after the period covered by the last such report, made an 
offer to acquire, expressed an interest in acquiring, entered into 
negotiations to acquire, or was contacted or made an inquiry about 
acquiring, an interest in the business to be divested,and shall 
describe in detail each contact with any such person during that 
period. Each such affidavit shall also include description of the 
efforts that Alcoa has taken to solicit a buyer for the Alcoa Cast 
Plate Division and to provide required information to prospective 
purchasers.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, Alcoa shall deliver to plaintiff an affidavit which 
describes in detail all actions Alcoa has taken and all steps Alcoa has 
implemented on an on-going basis to preserve the Alcoa Cast Plate 
Division pursuant to Section VIII of this Final Judgment and the Hold 
Separate Stipulation and Order entered by the Court. The affidavit also 
shall describe, but not be limited to, Alcoa's efforts to maintain and 
operate the Alcoa Cast Plate Division as an active competitor, maintain 
the management, staffing, research and development activities, sales, 
marketing, and pricing of the Alcoa Cast Plate Division, and maintain 
the Vernon facility in operable condition at current capacity 
configurations. Alcoa shall deliver to plaintiff an affidavit 
describing any changes to the efforts and actions outlined in Alcoa's 
earlier affidavits(s) filed pursuant to Section VII(B) within fifteen 
(15) calendar days after the change is implemented.
    C. Until one year after such divestiture has been completed, Alcoa 
shall preserve all records of all efforts made to preserve the business 
to be divested and effect the divestiture.

VIII

Hold Separate Order

    Until the divestitures required by the Final Judgment have been 
accomplished, Alcoa shall take all steps necessary to comply with the 
Hold Separate Stipulation and Order entered by this Court. Defendants 
shall take no action that would jeopardize the divestiture of the Alcoa 
Cast Plate Division.

IX

Financing

    Alcoa is ordered and directed not to finance all or any part of any 
purchase by an acquirer made pursuant to Sections IV or V of this Final 
Judgment.

X

Compliance Inspection

    For the purpose of determining or securing compliance with this 
Final Judgment, and subject to any legally recognized privilege, from 
time to time:
    A. Duly authorized representatives of the United States Department 
of Justice, upon written request of the Attorney General or the 
Assistant Attorney General in charge of the Antitrust Division, and on 
reasonable notice to defendants made to their principal offices, shall 
be permitted:
    1. Access during office hours of defendants to inspect and copy all 
books, ledgers, accounts, correspondence, memoranda, and other records 
and documents in the possession or under the control of defendants, who 
may have counsel present, relating to any matters contained in this 
Final Judgment and the Hold Separate Stipulation and Order; and
    2. Subject to the reasonable convenience of defendants and without 
restraint or interference from them, to interview, either informally or 
on the record, their officers, employees, and agents, who may have 
counsel present, regarding any such matters.
    B. Upon the written request of the Attorney General or of the 
Assistant Attorney General in charge of the Antitrust Division, made to 
defendants at their principal offices, defendants shall submit such 
written reports, under oath if requested, with respect to any of the 
matters contained in this Final Judgment and the Hold Separate 
Stipulation and Order.
    C. No information nor any documents obtained by the means provided 
in Sections VII or X of this Final Judgment shall be divulged by a 
representative of the United States to any person other than a duly 
authorized representative of the Executive Branch of the United States, 
except in the course of legal proceedings to which the United States is 
a party (including grand jury proceedings), or for the purpose of 
securing compliance with this Final Judgment, or as otherwise required 
by law.
    D. If at the time information or documents are furnished by 
defendants to plaintiff, defendants represent and identify in writing 
the materials in any such information or documents for

[[Page 35952]]

which a claim of protection may be asserted under Rule 26(c)(7) of the 
Federal Rules of Civil Procedures, and defendants marks each pertinent 
page of such material, ``Subject to claim of protection under Rule 
26(c)(7) of the Federal Rules of Civil Procedure,'' then plaintiff 
shall give ten (10 days notice to defendants prior to divulging such 
material in any legal proceeding (other than grand jury proceeding) to 
which defendants are not a party.

CI

Retention of Jurisdiction

    Jurisidiction is retained by this Court for the purpose of enabling 
any of the parties to this Final Judgment to apply to this Court at any 
time for such further orders and directions as may be necessary or 
appropriate for the construction or carrying out of this Final 
Judgment, for the modification of any of the provisions hereof, for the 
enforcement of compliance herewith, and for the punishment of any 
violations hereof.

XII

Termination

    Unless this Court grants an extension, this Final Judgment will 
expire on the tenth anniversary of the date of its entry.

XIII

Public Interest

    Entry of this Final Judgment is in the public interest.

Dated:-----------------------------------------------------------------

Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16

----------------------------------------------------------------------
United States District Judge

Competitive Impact Statement

    The United States, pursuant to Section 2(b) of the Antitrust 
Procedures and Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files 
this Competitive Impact Statement relating to the proposed Final 
Judgment submitted for entry in this civil antitrust proceeding.

I. Nature and Purpose of the Proceeding

    On June 15, 1998, the United States filed a civil antitrust 
Complaint alleging that the proposed acquisition by Aluminum Company of 
America (``Alcoa'') of the aluminum cast plate (``cast plate'') 
manufacturing business of Alumax Inc. (``Alumax'') would violate 
Section 7 of the Clayton Act, 15 U.S.C. 18. The Complaint alleges that 
Alcoa and Alumax are the two largest producers of aluminum cast plate 
in the world, and are each other's most significant competitor. They 
compete vigorously to lower the costs of producing and selling the best 
quality cast plate at the lowest prices, and to provide the best 
technological, marketing, and customer support services. There is only 
one other producer, Alpase, and it is much smaller and not nearly as 
significant. Alcoa and Alumax have proposed a transaction that will 
leave the already highly concentrated aluminum cast plate business with 
one overwhelmingly dominant firm--Alcoa--owning almost 90% of the cast 
plate manufacturing business in the world. Worldwide sales of cast 
plate in 1997 were $73,884,000.
    The prayer for relief in the Complaint seeks: (1) a judgment that 
the proposed acquisition would violate Section 7 of the Clayton Act; 
and (2) a permanent injunction preventing Alcoa from acquiring Alumax.
    When the Complaint was filed, the United States also filed a 
proposed settlement that would permit Alcoa to complete its acquisition 
of Alumax, but require a divestiture that will preserve competition in 
the relevant market. This settlement consists of a Stipulation and 
Order, Hold Separate Stipulation and Order, and a proposed Final 
Judgment.
    The proposed Final Judgment orders Alcoa to divest, within one 
hundred and eighty (180) calendar days after the filing of the 
Complaint in this matter, or five (5) days after notice of the entry of 
the Final Judgment by the Court, whichever is later the Alcoa Cast 
Plate Division (as defined in the Final Judgment) to an acquirer 
acceptable to the Antitrust Division of the Department of Justice 
(``DOJ''). ``Alcoa Cast Plate Division'' means all assets included 
within the cast plate operation of Alcoa's Aerospace and Commercial 
Rolled Products Division, including all tangible and intangible assets, 
and all research data concerning historic and current research and 
development efforts relating to the cast plate operation.
    Until such divestiture is completed, the terms of the Hold Separate 
Stipulation and Order entered into by the parties apply to ensure that 
the Alcoa Cast Plate Division shall be maintained as an independent 
competitor from Alcoa.
    The plaintiff and defendants have stipulated that the proposed 
Final Judgment may be entered after compliance with the APPA. Entry of 
the proposed Final Judgment would terminate the action, except that the 
Court would retain jurisdiction to construe, modify, or enforce the 
provisions of the proposed Final Judgment and to punish violations 
thereof.

II. Description of The Events Giving Rise to The Alleged Violation

A. The Defendants and the Proposed Transaction

    Alcoa is a Pennsylvania corporation, with its principal offices 
located in Pittsburgh, Pennsylvania. Alcoa is the world's largest 
integrated aluminum company, engaging in all phases of the aluminum 
business--from the mining and processing of bauxite to the production 
of primary aluminum and fabrication of products. In 1997, Alcoa had 
revenues of over $13 billion. Alcoa produces cast plate at a facility 
located in Vernon, California. Alcoa's 1997 sales of cast plate in the 
United States were $17,871,528.
    Alumax is a Delaware corporation, headquartered in Atlanta, 
Georgia. In 1997, Alumax reported total sales of about $3 billion. Its 
Mill Products Division produces cast plate, among other products, in 
Lancaster, Pennsylvania. Alumax's sales of cast plate in the United 
States were $38,991,628.
    On March 8, 1998, Alcoa and Alumax entered into an agreement under 
which Alcoa would acquire Alumax. This transaction, which would 
increase concentration in the already highly concentrated cast plate 
market, precipitated the government's suit.

B. Cast Plate Market

    Cast plate is a flat aluminum product, ranging from eight to twelve 
feet long, three to five feet wide and anywhere from one-quarter inch 
to thirty inches thick. Cast plate is produced by pouring molten 
aluminum onto a conveyor belt in a shape slightly thicker than what it 
ultimately desired. After cooling, the shape is milled to achieve its 
final thickness and shape. Cast plate has metallurgic characteristics 
that make it uniquely suited for certain applications. The casting 
process, which involves little or no pressing of the plate, produces 
aluminum that is free from stresses that can cause warping. The 
resulting cast metal shape is stable enough for applications that 
required precise dimensions and flatness, such as jigs, fixtures, and 
numerous tooling, mold, machinery and equipment applications. Cast 
plate is used to make machinery and equipment that manufactures end 
products with extremely narrow tolerances. Cast plate must be stress-
free, stable, and flat, because stress-induced warping, instability, 
and unevenness would cause movement in the machinery and

[[Page 35953]]

equipment made of cast plate, which in turn would cause the end 
products manufactured on that machinery and equipment to be out of 
tolerance.
    Other products are not realistic substitutes for cast plate to 
which customers could switch in the event of a small, but significant 
and non-transitory price increase. Rolled tooling plate is not a 
substitute because the rolled metal shape can warp. Furthermore, it is 
not possible to produce rolled plate as thick as cast plate can be 
made. Depending on the thickness of the shape, rolled plate can also be 
significantly more expensive than cast plate.
    Alcoa and Alumax are the two strongest and most significant 
producers of cast plate in the world, representing almost 90% of 1997 
sales. Alpease, the third competitor, is not as significant as either 
Alcoa or Alumax. Aggressive competition by Alcoa and Alumax has given 
customers lower prices and improved quality for cast plate products.
    Successful entry into the manufacture and sale of cast plate is 
difficult, time-consuming and costly. To build an efficient cast plate 
facility would cost in excess of $25 million, and would require as long 
as four years from the time of site selection to production of 
commercial quantities of cast plate. A new entrant into the cast plate 
business must submit its product to customers for qualification before 
the entrant will be accepted as a supplier. A new entrant must 
establish a reputation for good quality product and for reliability in 
fulfilling customer orders. There are no other domestic or foreign 
firms whose entry or expansion would be likely, timely, or sufficient 
to thwart an anticompetitive price increase.

C. Harm to Competition as a Consequence of the Acquisition

    The proposed acquisition would likely lessen competition in the 
manufacture and sale of cast plate. If Alcoa acquired the cast plate 
business of Alumax, it would control almost 90% of the cast plate 
business in the world and likely would increase prices, reduce quality, 
and decrease production of cast plate. Entry by a new company would not 
be timely, likely, or sufficient to prevent harm to competition.
    The Compliant alleges that the transaction would likely have the 
following effects, among others; actual and potential competition 
between Alcoa and Alumax in the cast plate market will be eliminated; 
competition generally in the sale and manufacture of cast plate 
worldwide would be lessened substantially; and prices for cast plate 
would increase.

III. Explanation of the Proposed Final Judgment

    The provisions of the proposed Final Judgment are designed to 
eliminate the anticompetitive effects of the acquisition of Alumax by 
Alcoa.
    The proposed Final Judgment provides that Alcoa must divest, within 
on hundred and eighty (180) calendar days after the filing of the 
Complaint in this matter, or five (5) days after notice of the entry of 
the Final Judgment by the Court, whichever is later, the Alcoa Cast 
Plate Division to an acquirer acceptable to the DOJ. If defendants fail 
to divest the Alcoa Cast Plate Division, a trustee (selected by DOJ) 
will be appointed.
    The Final Judgment provides that Alcoa will pay all costs and 
expenses of the trustee. After his or her appointment becomes 
effective, the trustee will file monthly reports with the parties and 
the Court, setting forth the trustee's efforts to accomplish 
divestiture. At the end of six months, if the divestiture has not been 
accomplished, the trustee and the parties will have the opportunity to 
make recommendations to the Court, which shall enter such orders as 
appropriate in order to carry out the purpose of the trust, including 
extending the trust or the term of the trustee's appointment.
    Divestiture of the Alcoa Cast Plate Division preserves competition 
because it will restore the cast plate market to a structure that 
existed prior to the acquisition and will preserve the existence of a 
independent competitor. Divestiture will keep at least three producers 
of cast plate in the market, which will preserve and encourage ongoing 
competition in the production and sale of cast plate.

IV. Remedies Available to Potential Private Litigants

    Seciton 4 of the Clayton Act, 15 U.S.C. 15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three time 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the proposed Final Judgment will neither 
impair nor assist the bringing of any private antitrust damage action. 
Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 
Sec. 16(a), the proposed Final Judgment has no prima facie effect in 
any subsequent private lawsuit that may be brought against defendants.

V. Procedures Available for Modification of the Proposed Final 
Judgment

    The United States and defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least sixty days preceding the 
effective date of the proposed Final Judgment within which any person 
may submit to the United States written comment regarding the proposed 
Final Judgment. Any person who wishes to comment should do so within 
sixty days of the date of the dated of publication of this Competitive 
Impact Statement in the Federal Register. The United States will 
evaluate and respond to the comments. All comments will be given due 
consideration by the Department of Justice, which remains free to 
withdraw its consent to the proposed Judgment at any time prior to 
entry. The comments and the response to the United States will be filed 
with the Court and published in the Federal Register.
    Written comments should be submitted to: Roger W. Fones, Chief, 
Transportation, Energy and Agriculture Section, Antitrust Division, 
United States Department of Justice, 325 Seventh Street, NW., Suite 
500, Washington, DC 20004.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    The United States considered, as an alternative to the proposed 
Final Judgment, a full trial on the merits against defendants Alcoa and 
Alumax.
    The United States is satisfied that the divestiture of the 
described assets specified in the proposed Final Judgment will 
encourage viable competition in the production and sale of cast plate. 
The United States is satisfied that the proposed relief will prevent 
the acquisition from having anticompetitive effects in this market. The 
divestiture of the Cast Plate Division will restore the cast plate 
market to a structure that existed prior to the acquisition and will 
preserve the existence of an independent competitor.

[[Page 35954]]

VII. Standard of Review under the APPA for Proposed Final Judgment

    The APPA requires that proposed consent judgments IN antitrust 
cases brought by the United States be subject to a sixty-day comment 
period, after which the court shall determine whether entry of the 
proposed Final Judgment ``is in the public interest.'' In making that 
determination, the court may consider--
    (1) the competitive impact of such judgment, including termination 
of alleged violations, provisions for enforcement and modification, 
duration or relief sought, anticipated effects of alternative remedies 
actually considered, and any other consideration bearing upon the 
adequacy of such judgment;
    (2) the impact of entry of such judgment upon the public generally 
and individuals alleging specific inquiry from the violations set forth 
in the complaInt including consideration of the public benefit, if any, 
to be derived from a determination of the issues at trial.
    15 U.S.C. 16(e) (emphasis added). As the Court of Appeals for the 
District of Columbia Circuit recently held, the APPA permits a court to 
consider, among other things, the relationship between the remedy 
secured and the specific allegations set forth in the government's 
complaint, whether the decree is sufficiently clear, whether 
enforcement mechanisms are sufficient, and whether the decree may 
positively harm third parties. See United States v. Microsoft, 56 F.3d 
1448 (D.C. Cir. 1995).
    In conducting this inquiry, ``the Court is nowhere compelled to go 
on trial or to engage in extended proceedings which might have the 
effect of vitiating the benefits of prompt and less costly settlement 
through the consent decree process.''\1\ Rather

    \1\ 119 Cong. Rec. 24598 (1973), See also United States v. 
Gillette Co., 406 F. Supp. 713, 715 (D. Mass. 1975), A ``public 
interest'' determination can be made properly on the basis of the 
Competitive Impact Statement and Response to Comments filed pursuant 
to the APPA. Although the APPA authorizes the use of additional 
procedures, 15 U.S.C. 16(f), those procedures are discretionary. A 
court need not invoke any of them unless it believes that the 
comments have raised significant issues and that further proceedings 
would aid the court in resolving those issues. See  H.R. 93-1463, 
93rd Cong. 2d Sess. 8-9, reprinted in (1974) U.S. Code Cong. & Ad. 
News 6535, 6538.
---------------------------------------------------------------------------

    absent a showing of corrupt failure of the government to 
discharge its duty, the Court, in making its public interest 
finding, should . . . carefully consider the explanations of the 
government in the competitive impact statement and its response to 
comments in order to determine whether those explanations are 
reasonable under the circumstances.

    United States v. Mid-America Dairymen, Inc., 1977-1 Trade Cas 
61,508, at 71,980 (W.D. Mo. 1977)
    Accordingly, with respect to the adequacy of the relief secured by 
the decree, a court may not ``engage in an unrestricted evaluation of 
what relief would best serve the public.'' United States v. BNS, Inc., 
858 F2d 456, 462 (9th Cir. 1988), quoting United States v. Bechtel 
Corp., 648 F.2d 660, 666 (9th Cir.) cert denied, 454 U.S. 1083 (1981); 
see also Microsoft, 56 F.3d 1448 (D.C. Cir. 1995), Precedent requires 
that

[t]he balancing of competing social and political interest affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is the one that will best serve society, but 
whether the settlement is `within the reaches of the public 
interest.' More elaborate requirements might undermine the 
effectiveness of antitrust enforcement by consent decree.\2\

    \2\ United States v. Bethtel, 648 F.2d at 666 (internal 
citations omitted) (emphasis added); see United States v. BNS, Inc., 
858 F.2d at 463, United States v. National Broadcasting Co. 449 F. 
Supp. 1127, 1143, (C.D. Cal. 1978); Gillette, 406 F. Supp. at 716. 
See also United States v. American Cyanamid Co., 719 F.2d 558, 565 
(2d Cir. 1983).
---------------------------------------------------------------------------

    The proposed Final Judgment, therefore, should not be reviewed 
under a standard of whether it is certain to eliminate every 
anticompetitive effect of a particular practice or whether it mandates 
certainly of free competition in the future. Court approval of a final 
judgment requires a standard more flexible and less strict than the 
standard required for a finding of liability.``[A] proposed decree must 
be approved even if its falls short of the remedy the court would 
impose on its own, as long as it falls within the range of 
acceptability or is `within the reaches of public interest.' (citations 
omitted).''\3\
---------------------------------------------------------------------------

    \3\ United States v. American Tel. & Tel. Co., 552 F. Supp. 131, 
150 (D.D.C. 1982), aff'd sub nom, Maryland v. United States, 460 
U.S. 1001 (1983), quoting Gillette, 406 F. Supp, at 716; United 
States v. Alcan Aluminum, Ltd., 605 F. Supp, 619, 622 (W.D. Ky. 
1985).
---------------------------------------------------------------------------

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.

    For Plaintiff United States of America:

    Date: June 18, 1998.

      Respectfully submitted,
Nina B. Hale,
Washington Bar # 18776,
Andrew K. Rosa,
Hawaii Bar # 6366,
Michele Cano,
Jade Alice Eaton.
Trial Attorneys,
U.S. Department of Justice,
Antitrust Division,
325 Seventh Street, NW,
Suite 500,
Washington, DC 20004,
202-307-0892,
202-307-2441 (Facsimile).

Certificate of Service

    I hereby certify that I have caused a copy of the foregoing 
Competitive Impact Statement to be served on counsel for defendants in 
this matter in the manner and on the date set forth below:
    By the first class mail, postage prepaid:
D. Stuart Meiklejohn,
Sullivan & Cromwell,
125 Broad Street, 28th Floor,
New York, NY 10004.
David I. Gelfand, Cleary, Gottlieb, Steen & Hamilton,
2000 Pennsylvania Avenue, NW., Washington, DC 20006.
    Dated: June 18, 1998.
Andrew K. Rosa,
Antitrust Division, U.S. Department of Justice, 325 Seventh Street, NW, 
Suite 500, Washington, D.C. 20530, (202) 307-0886, (202) 616-2441 
(Fax).
[FR Doc. 98-17504 Filed 6-30-98; 8:45 am]
BILLING CODE 4410-11-M