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[Federal Register Volume 66, Number 107 (Monday, June 4, 2001)]
[Notices]
[Pages 29997-30006]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-13863]

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DEPARTMENT OF JUSTICE

Antitrust Division

United States v. The News Corporation Limited, Fox Television 
Holdings, Inc., and Chris-Craft Industries, Inc. Proposed Final 
Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Secs. 16(b)-(h), that a Complaint, proposed 
Final Judgment, Hold Separate Stipulation and Order, and Competitive 
Impact Statement were filed with the U.S. District Court for the 
District of Columbia in United States v. News Corporation Limited, Fox 
Television Holdings, Inc., and Chris-Craft Industries, Inc., Civ. 
Action No. 1:01CV00771. On April 11, 2001, the United States filed a 
Complaint, which sought to enjoin The News Corporation Limited (``News 
Corp'') and its subsidiary, FOX Television Holdings, Inc., from 
acquiring Chris-Craft Industries (``Chris-Craft''). The Complaint 
alleged that News Corp's acquisition of Chris-Craft would substantially 
lessen competition in the sale of broadcast television spot advertising 
in violation of the Clayton Act, as amended, 15 U.S.C. 18, in the Salt 
Lake City, Utah market. The proposed Final Judgment, also filed on 
April 11, 2001, requires defendants to divest KTVX-TV, a Salt Lake 
City, Utah ABC affiliate, to preserve competition in the sale of 
broadcast television spot advertising time in the Salt Lake City 
market. A Hold Separate Stipulation and Order, entered by the Court on 
April 16, 2001, requires defendants to maintain, prior to divestiture, 
the competitive independence and economic viability of the assets 
subject to divestiture under the proposed Final Judgment. A Competitive 
Impact Statement filed by the United States describes the Complaint, 
proposed Final Judgment, Hold Separate Stipulation and Order, and the 
remedies available to private litigants who may have been injured by 
the alleged violations.
    Copies of the Complaint, proposed Final Judgment, Hold Separate 
Stipulation and Order and Competitive Impact Statement are available 
for inspection at the U.S. Department of Justice, Antitrust Division, 
325 Seventh Street, NW., Room 215, Washington, DC 20530 (telephone: 
202-514-2481), and at the Clerk's Office of the United States District 
Court for the District of Columbia, Washington, DC. Copies of these 
materials may be obtained upon request and payment of a copying fee.
    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. Comments should be directed 
to J. Robert Kramer II, Chief, Litigation II Section, Antitrust 
Division, U.S. Department of Justice, 1401 H Street, NW., Suite 3000, 
Washington, DC 20530 (telephone: 202-307-0924).

Constance K. Robinson,
Director of Operations and Merger Enforcement.

United States District Court for the District of Columbia

[Civil Action No. 01 0771]

United States of America, Plaintiff, v. The News Corporation Limited, 
Fox Television Holdings, Inc., and Chris-Craft Industries, Inc., 
Defendants.

    Filed: Apr. 17, 2001

Hold Separate Stipulation and Order

    It is hereby stipulated and agreed 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. ``News Corp'' means defendant The News Corporation Limited, and 
Australian corporation with its

[[Page 29998]]

headquarters in Sydney, New South Wales, Australia, its successors and 
assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships and joint ventures, and their directors, officers, 
managers, agents, and employees.
    B. ``FOX'' means defendant FOX Television Holdings, Inc., a 
Delaware corporation and a wholly owned subsidiary of News Corp with 
headquarters in Los Angeles, California, its successors and assigns, 
and its subsidiaries, divisions, groups, affiliates, partnerships and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    C. ``Chris-Craft'' means defendant Chris-Craft Industries, Inc., a 
Delaware corporation with its headquarters in New York, New York, its 
successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships and joint ventures, and their directors, 
officers, managers, agents, and employees.
    D. ``KTVX-TV'' means the broadcast television station located in 
the Salt Lake City DMA owned by defendant Chris-Craft through its 
subsidiary United Television, Inc. operating at Channel 4.
    E. ``Divestiture Assets'' means all of the assets, tangible or 
intangible, used in the operation of KTVX-TV, including, but not 
limited to, all real property (owned or leased) used in the operation 
of the station, all broadcast equipment, office equipment, office 
furniture, fixtures, materials, supplies, and other tangible property 
used in the operation of the station: all licenses, permits, 
authorizations, and applications therefor issued by the Federal 
Communications Commission (``FCC'') and other government agencies 
related to that station; all contracts (including programming contracts 
and rights), agreements, network affiliation agreements, leases and 
commitments and understandings of defendant Chris-Craft relating to the 
operation of KTVX-TV; all trademarks, service marks, trade names, 
copyrights, patents, slogans, programming materials, and promotional 
materials relating to KTVX-TV; all customer lists, contracts, accounts, 
and credit records; and all logs and other records maintained by 
defendant Chris-Craft in connection with KTVX-TV.
    F. ``KSTU-TV'' means the broadcast television station located in 
the Salt Lake City DMA owned by defendant News Corp through its 
subsidiary FOX operating at Channel 13.
    G. ``DMA'' means designated market area as defined by A.C. Nielsen 
Company based upon viewing patterns and used by the Investing In 
Television BIA Market Report 2000 (3rd edition). DMAs are ranked 
according to the number of households therein and are used by 
broadcasters, advertisers and advertising agencies to aid in evaluating 
television audience size and composition.
    H. ``Acquirer'' means the entity to whom defendants divest the 
Divestiture Assets.

II. Objectives

    The Final Judgment filed in this case is meant to ensure 
defendants' prompt divestiture of the Divestiture Assets for the 
purpose of maintaining a viable competitor in the sale of television 
advertising time in the Salt Lake City DMA and to remedy the 
anticompetitive effects that the United States alleges would otherwise 
result from News Corp's proposed acquisition of Chris-Craft. This Hold 
Separate Stipulation and Order ensures, prior to such divestiture, that 
the Divestiture Assets remain independent, economically viable, and an 
ongoing business concern that will remain independent and uninfluenced 
by the consummation of News Corp's acquisition of Chris-Craft, and that 
competition is maintained during the pendency of the ordered 
divestiture.

III. Jurisdiction and Venue

    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.

IV. Compliance With and Entry of Final Judgment

    A. The parties stipulate that a Final Judgment in the form attached 
hereto as Exhibit A may be filed with 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 Procedures and 
Penalties Act (15 U.S.C. 16), and without further notice to any party 
or other proceedings, provided that the United States 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.
    B. Defendants shall abide by and comply with the provisions of the 
proposed Final Judgment, pending the Judgment's entry 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 the same were 
in full force and effect as an order of the Court.
    C. Defendants shall not consummate the transaction sought to be 
enjoined by the Complaint herein before the Court has signed this Hold 
Separate Stipulation and Order.
    D. 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.
    E. In the event (1) the United States has withdrawn its consent, as 
provided in Section IV(A) above, or (2) 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.
    F. Defendants represent that the divestiture ordered in the prosed 
Final Judgment can and will be made, and that defendants will later 
raise no claim of mistake, hardship or difficulty of compliance as 
grounds for asking the Court to modify any of the provisions contained 
therein.
    G. The parties recognize that there could be a delay in obtaining 
approval by or a ruling of a government agency related to the 
divestitures required by Section IV of the Final Judgment, 
notwithstanding the good faith efforts of the defendants and any 
prospective Acquirer, as defined in the Final Judgment. In this 
circumstance, plaintiff will, in the exercise of its sole discretion 
give special consideration to forbearing from applying for the 
appointment of a trustee pursuant to Section V(A) of the Final 
Judgment, or from pursuing legal remedies available to it as a result 
of such delay, provided that; (1) defendants have entered into one or 
more definitive agreements to divest the Divestiture Assets, as defined 
in the Final Judgment, and such agreements and the Acquirer have been 
approved by the United States; (2) all papers necessary to secure any 
governmental approvals and/or rulings to effectuate such divestitures 
(including but not limited to the FCC, Securities and Exchange 
Commission, and Internal Revenue Service approvals or rulings) have 
been filed with the appropriate agency; (3) receipt of such approvals 
are the only closing conditions that have

[[Page 29999]]

not been satisfied or waived; and (4) defendants have demonstrated that 
neither they nor the prospective Acquirer is responsible for such 
delay.

V. Hold Separate Provisions

    Until the divestiture required by the Final Judgment has been 
accomplished:
    A. Defendants shall preserve, maintain, and continue to operate 
KTVX-TV as a competitively independent, ongoing economically viable 
competitive business, with its assets, management, decision-making 
functions and operations separate, distinct, and apart from KTSU-TV and 
News Corp's and FOX's other operations. Within twenty (20) calendar 
days after the entry of this Hold Separate Stipulation and Order, 
defendants will inform the United States of the steps defendants have 
taken to comply with this Hold Separate Stipulation and Order.
    B. Defendants shall take all steps necessary to ensure that (1) 
KTVX-TV will be maintained and operated as an independent, ongoing, 
economically viable and active competitor to the other television 
stations in the Salt Lake City DMA; (2) management of KTVX-TV, 
including the performance of decision-making functions regarding 
marketing and pricing, will be kept separate and apart from and not 
influenced by defendant News Corp or FOX; and (3) the books, records, 
competitively sensitive sales, marketing and pricing information, and 
decision-making associated with KTVX-TV will be kept separate and apart 
from that of KSTU-TV and News Corp's or FOX's other operations.
    C. Defendants shall use all reasonable efforts to maintain and 
increase sales of advertising time by KTVX-TV and shall maintain at 
2000 or previously approved levels for 2001, whichever are higher, 
promotional, advertising, sales, technical assistance, marketing and 
merchandising support for KTVX-TV.
    D. Defendants shall provide sufficient working capital and lines 
and sources of credit to continue to maintain the Divestiture Assets as 
an economically viable and competitive ongoing business, consistent 
with the requirements of Sections V(A) and V(B).
    E. Defendants shall take all steps necessary to ensure that the 
Divestiture Assets are fully maintained in operable condition and shall 
maintain and adhere to normal repair and maintenance schedules for the 
Divestiture Assets.
    F. Defendants shall not, except as part of a divestiture approved 
by the United States in accordance with the terms of the Final 
Judgment, remove, sell, lease, assign, transfer, license, pledge for 
collateral, or otherwise dispose of any of the Divestiture Assets.
    G. Defendants shall maintain, in accordance with sound accounting 
principles, separate, 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, and income of the Divestiture Assets.
    H. Defendants shall take no action that would jeopardize, delay, or 
impede the sale of the Divestiture Assets.
    I. Defendants' employees with primary responsibility for sales, 
marketing and programming of KTVX-TV shall not be transferred or 
reassigned to any other station, except for transfer bids initiated by 
employees pursuant to each defendant's regular, established job posting 
policy. Defendants shall provide the United States with ten (10) 
calendar days' notice of such transfer.
    J. Prior to consummation of their transaction, defendants shall 
appoint Gregory Nathanson to oversee the Divestiture Assets, and who 
will be responsible for defendants' compliance with this section. 
Gregory Nathanson shall have complete managerial responsibility for the 
Divestiture Assets, subject to the provisions of the Final Judgment. In 
the event he is unable to perform his duties, defendants shall appoint, 
subject to the approval of the United States, a replacement within ten 
(10) working days. Should defendants fail to appoint a replacement 
acceptable to the United States within this time period, the United 
States shall appoint a replacement.
    K. Defendants shall take no action that would interfere with the 
ability of any trustee appointed pursuant to the Final Judgment to 
monitor and complete the divestiture pursuant to the Final Judgment to 
a purchaser acceptable to the United States.
    L. This Hold Separate Stipulation and Order shall remain in effect 
until consummation of the divestiture required by the proposed Final 
Judgment or until further order of the Court.

    Dated: April 11, 2001.

    For Plaintiff, United States of America.

Carolyn L. Davis,
Esquire, PA Bar #36136, United States Department of Justice, 
Antitrust Division, Litigation II Section, 1401 H Street, NW, Suite 
3000, Washington, DC 20530, (202) 514-5815.

    Respectfully submitted,
    For Defendants, The News Corporation Limited and Fox Television 
Holdings, Inc.

Lloyd Constantine,
Esquire, Constantine & Partners, 477 Madison Avenue, New York, NY 
10022, (212) 350-2702

    For Defendants, Chris-Craft Industries.
Neal Stoll,
Esquire, Skadden, Arps, Slate, Meagher & Flom LLP, Four Times 
Square, New York, NY 10036, (212) 735-3000.

Order

It Is So Ordered by the Court, this 16th day of April, 2001.

Coller Kolla-Kotelly,
United States District Judge.

United States District Court for the District of Columbia

[Civil Action No. 01 0771]

United States of America, Plaintiff, v. The News Corporation Limited, 
Fox Television Holdings, Inc., and Chris-Craft Industries, Inc., 
Defendants.

Final Judgment

    Whereas, plaintiff, United States of America, filed its Complaint 
on April 11th, 2001, plaintiff and defendants, The News Corporation 
Limited (``News Corp''), Fox Television Holdings, Inc. (``FOX''), and 
Chris-Craft Industries, Inc. (``Chris-Craft''), by their respective 
attorneys, have consented to the entry of this Final Judgment without 
trial or adjudication of any issue of fact or law, and without this 
Final Judgment constituting any evidence against or admission by any 
part regarding any issue of fact or law.
    And Whereas, defendants agree 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 certain rights or assets by the defendants 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 the United States that 
the divestitures required below can and will be made and that 
defendants will later raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the divestiture 
provisions contained below;
    Now, Therefore, before any testimony is taken, without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is Ordered, Adjudged, and Decreed:

I. Jurisdiction

    This Court has jurisdiction over the subject matter of and each of 
the parties to this action. The Complaint states a

[[Page 30000]]

claim upon which relief may be granted against defendants under Section 
7 of the Clayton Act, as amended (15 U.S.C. 18).

II. Definitions

    As used in this Final Judgment:
    A. ``News Corp'' means defendant The News Corporation Limited, an 
Australian corporation with its headquarters in Sydney, New South 
Wales, Australia, its successors and assigns, and its subsidiaries, 
divisions, groups, affiliates, partnerships and joint ventures, and 
their directors, officers, managers, agents, and employees.
    B. ``FOX'' means defendant FOX Television Holdings, Inc., a 
Delaware corporation and a wholly owned subsidiary of News Corp with 
headquarters in Los Angeles, California, its successors and assigns, 
and its subsidiaries, divisions, groups, affiliates, partnerships and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    C. ``Chris-Craft'' means defendant Chris-Craft Industries, Inc., a 
Delaware corporation with its headquarters in New York, New York, its 
successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships and joint ventures, and their directors, 
officers, managers, agents, and employees.
    D. ``KTVX-TV'' means the broadcast television station located in 
the Salt Lake City DMA owned by defendant Chris-Craft through its 
subsidiary United Television, Inc. operating at Channel 4.
    E. ``Divestiture Assets'' means all of the assets, tangible or 
intangible, used in the operation of KTVX-TV, including, but not 
limited to, all real property (owned or leased) used in the operation 
of the station, all broadcast equipment, office equipment, office 
furniture, fixtures, materials, supplies, and other tangible property 
used in the operation of the station; all licenses, permits, 
authorizations, and applications therefore issued by the Federal 
Communications Commission (``FCC'') and other government agencies 
related to that station; all contracts (including programming contracts 
and rights), agreements, network affiliation agreements, leases and 
commitments and understandings of defendant Chris-Craft relating to the 
operation of KTVX-TV; all trademarks, service marks, trade names, 
copyrights, patents, slogans, programming materials, and promotional 
materials relating to KTVX-TV; all customer lists, contracts, accounts, 
and credit records; and all logs and other records maintained by 
defendant Chris-Craft in connection with KTVX-TV.
    F. ``DMA'' means designated market area as defined by A.C. Nielsen 
Company based upon viewing patterns and used by the Investing In 
Television BIA Market Report 2000 (3rd edition) DMAs are ranked 
according to the number of households therein and are used by 
broadcasters, advertisers and advertising agencies to aid in evaluating 
television audience size and composition.
    G. ``Acquirer'' means the entity to whom defendants divest the 
Divesture Assets.

III. Applicability

    A. This Final Judgment applies to News Corp, FOX, and Chris-Craft, 
as defined above, and all other persons in active concert or 
participation with either of them who receive actual notice of this 
Final Judgment by personal service or otherwise.
    B. Defendants shall require, as a condition of the sale or other 
disposition of all or substantially all of their assets or of lesser 
business units that include the Divestiture Assets, that the purchaser 
agrees to be bound by the provisions of this Final Judgment.

IV. Divestitures

    A. Defendants are ordered and directed to divest the Divestiture 
Assets in a manner consistent with this Final Judgment to an Acquirer 
acceptable to the United States in its sole discretion, before the 
later of (1) one hundred and fifty (150) calendar days after the filing 
of the Complaint in this matter or (2) five (5) days after notice or 
the entry of this Final Judgment by the Court. The United States, in 
its sole discretion, may agree to an extension of this time period of 
up to two thirty (30) day time periods, not to exceed sixty (60) 
calendar days in total, and shall notify the Court in such 
circumstances. Defendants agree to use their best efforts to divest the 
Divestiture Assets, and to obtain all regulatory approvals necessary 
for such divestitures, as expeditiously as possible.
    B. In accomplishing the divestiture ordered by this Final Judgment, 
defendants promptly shall make known, by usual and customary means, the 
availability of the Divestiture Assets. Defendants shall inform any 
person making inquiry regarding a possible purchase of the Divestiture 
Assets that they are being divested pursuant to this Final Judgment and 
provide that person with a copy of this Final Judgment. Defendants 
shall offer to furnish to all prospective Acquirers, subject to 
customary confidentiality assurances, all information and documents 
relating to the Divestiture Assets customarily provided in a due 
diligence process, except such information or documents subject to the 
attorney-client or work product privileges. Defendants shall make 
available such information to the United States at the same time that 
such information is made available to any other person.
    C. Defendants shall provide the Acquirer and the United States 
information relating to the personnel involved in the operation of the 
Divestiture Assets to enable the Acquirer to make offers of employment. 
Defendants will not interfere with any negotiations by the Acquirer to 
employ any defendant employee whose primary responsibility relates to 
the operation of the Divestiture Assets.
    D. Defendants shall permit prospective Acquirers of the Divestiture 
Assets to have reasonable access to personnel and to make inspections 
of the physical facilities of the television station to be divested; 
access 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.
    E. Defendants shall warrant to the Acquirer of the Divestiture 
Assets that the assets will be operational on the date of sale.
    F. Defendants shall not take any action that will impede in any way 
the permitting, operation, or divestiture of the Divestiture Assets.
    G. Defendants shall warrant to the Acquirer of the Divestiture 
Assets that there are no material defects in the environmental, zoning 
or other permits pertaining to the operation of the assets, and that 
following the sale of the Divestiture Assets, defendants will not 
undertake, directly or indirectly, any challenges to the environmental, 
zoning or other permits relating to the operation of the Divestiture 
Assets.
    H. 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 Divestiture 
Assets, and shall be accomplished in such a way as to satisfy the 
United States, in its sole discretion, that the Divestiture Assets can 
and will be used by the Acquirer as part of a viable, ongoing 
commercial television broadcasting business. The divestiture of such 
assets will remedy the competitive harm alleged in the Complaint. The 
divestiture, whether pursuant to Section IV or V of this Final 
Judgment,

    (1) Shall be made to an Acquirer that, in the United States's 
sole judgment, has the

[[Page 30001]]

intent and capability (including the necessary managerial, 
operational, and financial capability) of competing effectively in 
the commercial television broadcasting business in the Salt Lake 
City DMA; and
    (2) Shall be accomplished so as to satisfy the United States, in 
its sole discretion, that none of the terms of any agreement between 
an Acquirer and defendants give defendants the ability unreasonably 
to raise the Acquirer's costs, to lower the Acquirer's efficiency, 
or otherwise to interfere in the ability of the Acquirer to compete 
effectively.

V. Appointment of Trustee

    A. If defendants have not divested the Divestiture Assets within 
the time period specified in Section IV(A), defendants shall notify the 
United States of that fact in writing. Upon application of the United 
States, the Court shall appoint a trustee selected by the United States 
and approved by the Court to effect the divestiture of the Divestiture 
Assets.
    B. After the appointment of a trustee become effective, only the 
trustee shall have the right to sell the Divestiture Assets. The 
trustee shall have the power and authority to accomplish the 
divestiture to an Acquirer acceptable to the United States at such 
price and on such terms as are then obtainable upon reasonable effort 
by the trustee, subject to the provisions of Sections IV, V and VI of 
this Final Judgment, and shall have such other powers as this Court 
deems appropriate. Subject to Section V(D) of this Final Judgment, the 
trustee may hire at the cost and expense of defendants any investment 
bankers, attorneys, or other agents, who shall be solely accountable to 
the trustee, reasonably necessary in the trustee's judgment to assist 
in the divestiture.
    C. Defendants shall not object to a sale by the trustee on any 
ground other than the trustee's malfeasance. Any such objections by 
defendants must be conveyed in writing to the United States and the 
trustee within ten (10) calendar days after the trustee has provided 
the notice required under Section VI.
    D. The trustee shall serve at the cost and expense of defendants, 
on such terms and conditions as the United States approves, 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 defendants and the trust shall then be 
terminated. The compensation of the trustee and any professionals and 
agents retained by the trustee shall be reasonable in light of the 
value of the Divestiture Assets 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, but 
timeliness is paramount.
    E. Defendants shall use their best efforts to assist the trustee in 
accomplishing the required divestiture. The trustee and any 
consultants, accountants, attorneys, and other persons retained by the 
trustee shall have full and complete access to the personnel, books, 
records, and facilities related to the business to be divested and 
defendants shall develop financial and other information relevant to 
such business as the trustee may reasonably request, subject to 
reasonable protection for trade secret or other confidential research, 
development, or commercial information. Defendants shall take no action 
to interfere with or to impede the trustee's accomplishment of the 
divestiture.
    F. After its appointment becomes effective, the trustee shall file 
monthly reports with the United States and the Court, setting forth the 
trustee's efforts to accomplish the divestiture ordered under this 
Final Judgment. 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 Divestiture Assets, and 
shall describe in detail each contact with any such person. The trustee 
shall maintain full records of all efforts made to divest the 
Divestiture Assets.
    G. If the trustee has not accomplished such divestiture within six 
(6) months after its appointment, the trustee shall promptly file 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. To the extent such reports contain 
information that the trustee deems confidential, such report shall not 
be filed in the public docket of the Court. The trustee at the same 
time shall furnish such report to the United States, who shall have the 
right to make additional recommendations consistent with the purpose of 
the trust. The Court thereafter shall enter such orders as it shall 
deem appropriate to carry out the purpose of this Final Judgment, which 
may, if necessary, include extending the trust and the term of the 
trustee's appointment by a period requested by the United States.

VI. Notice of Proposed Divestiture

    A. Within two (2) business days following execution of a definitive 
divestiture agreement, defendants or the trustee, whichever is then 
responsible for effecting the divestiture required herein, shall notify 
the United States of any proposed divestiture required by Section IV or 
V of this Final Judgment. If the trustee is responsible, it shall 
similarly notify defendants. The notice shall set forth the details of 
the proposed divestiture and list the name, address, and telephone 
number of each person not previously identified who offered or 
expressed an interest in or desire to acquire any ownership interest in 
the Divestiture Assets, together with full details of the same.
    B. Within fifteen (15) calendar days of receipt by the United 
States of such notice, the United States may request from defendants, 
the proposed Acquirer, any other third party, or the trustee if 
applicable additional information concerning the proposed divestiture, 
the proposed Acquirer and any other potential Acquirer. Defendants and 
the trustee shall furnish any additional information requested within 
fifteen (15) calendar days of the receipt of the request, unless the 
parties shall otherwise agree.
    C. Within thirty (30) calendar days after receipt of the notice or 
within twenty (20) calendar days after the United States has been 
provided the additional information requested from defendants, the 
proposed Acquirer, any third party and the trustee, whichever is later, 
the United States shall provide written notice to defendants and the 
trustee, if there is one, stating whether or not it objects to the 
proposed divestiture. If the United States provides written notice that 
it does not object, the divestiture may be consummated, subject only to 
defendants' limited right to object to the sale under Section V(C) of 
this final Judgment. Absent written notice that the United States does 
not object to the proposed Acquirer or upon objection by the United 
States, a divestiture proposed under Section IV or V shall not be 
consummated. Upon objection by defendants under Section V(C), a 
divestiture proposed under Section V shall not be consummated unless 
approved by the Court.

VII. Financing

    Defendants shall not finance all or any part of any purchase made 
pursuant to this Final Judgment.

[[Page 30002]]

VIII. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
and every thirty (30) calendar days thereafter until the divestiture 
has been completed, whether pursuant to Section IV or V of this Final 
Judgment, defendants shall deliver to the United States an affidavit as 
to the fact and manner of their compliance with Section IV or V of this 
Final Judgment. Each such affidavit shall include the name, address, 
and telephone number of each person who, during the preceding thirty 
(30) days, 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 Divestiture 
Assets, and shall describe in detail each contact with any person 
during that period. Each such affidavit shall also include a 
description of the efforts that defendants have taken to solicit buyers 
for the Divestiture Assets and to provide required information to 
prospective purchasers, including the limitations, if any, on such 
information. Assuming the information set forth in the affidavit is 
true and complete, any objection by the United States to information 
provided by defendants, including limitations on information, shall be 
made within fourteen (14) days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this manner, defendants shall deliver to the United States an 
affidavit that describes in reasonable detail all actions defendants 
have taken and all steps defendants have implemented on an ongoing 
basis to comply with Section IV of this Final Judgment. Defendants 
shall deliver to the United States an affidavit describing any changes 
to the efforts and actions outlined in defendants' earlier affidavits 
filed pursuant to this section within fifteen (15) calendar days after 
the change is implemented.
    C. Defendants shall keep all records of all efforts made to 
preserve and divest the Divestiture Assets until one year after such 
divestiture has been completed.

IX. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of determining whether the Final Judgment should be 
modified or vacated, and subject to any legally recognized privilege, 
from time to time duly authorized representatives of the United States 
Department of Justice, including consultants and other persons retained 
by the United States, shall, upon the written request of a duly 
authorized representative of the Assistant Attorney General in charge 
of the Antitrust Division, and on reasonable notice to defendants, be 
permitted:

    (1) access during defendants' office hours to inspect and copy 
or, at plaintiff's option, to require defendants provide copies of, 
all books, ledgers, accounts, records and documents in the 
possession, custody, or control of the defendants, who may have 
counsel present, relating to any matters contained in this Final 
Judgment, and
    (2) to interview, either informally or on the record, 
defendants' officers, employees, or agents, who may have their 
individual counsel present, regarding such matters. The interviews 
shall be subject to the interviewee's reasonable convenience and 
without restraint or interference by defendants.

    B. Upon the written request of a duly authorized representative of 
the Assistant Attorney General in charge of the Antitrust Division, 
defendants shall submit such written reports, under oath if requested, 
relating to any of the matters contained in this Final Judgment as may 
be requested.
    C. No information or documents obtained by the means provided in 
this section shall be divulged by the United States to any person other 
than an 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 the United States, defendants represent and identify in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under Rule 26(c)(7) of the Federal 
Rules of Civil Procedure, and defendants mark each pertinent page of 
such material, ``Subject to claim of protection under Rule 26(c)(7) of 
the Federal Rules of Civil Procedure,'' then the United States shall 
give defendants ten (10) calendar days' notice prior to divulging such 
material in any legal proceeding (other than a grand jury proceeding).

X. No Reacquisition

    During the term of this Final Judgment, defendants may not 
reacquire any part of the Divestiture Assets or enter into any local 
marketing agreement, joint sales agreement, or any other cooperative 
selling arrangement with respect to the Divestiture Assets.

XI. Retention of Jurisdiction

    This Court retains jurisdiction to enable any party to this Final 
Judgment to apply to this Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to enforce 
compliance, and to punish violations of its provisions.

XII. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire ten years from the date of its entry.

XIII. Public Interest Determination

    Entry of this Final Judgment is in the public interest.
    Court Approval Subject to Procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16.

United States District Court for the District of Columbia

[Civil Action No. 1:01cv00771]

United States of America, Plaintiff, v. The News Corporation Limited, 
Fox Television Holdings, Inc., Chris-Craft Industries, Inc., 
Defendants.

Judge: Colleen Kollar-Kotelly

Competitive Impact Statement

    The United States, pursuant to Section 2(b) of the Antitrust 
Procedures and Penalties Act (``APPA''), 15 U.S.C. Sec. 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

    The United States filed a civil antitrust Complaint on April 11, 
2001, alleging that the proposed acquisition of Chris-Craft Industries, 
Inc. (``Chris-Craft'') by The News Corporation Limited (``News Corp'') 
and Fox Television Holding, Inc. (``FOX'') would violate Section 7 of 
the Clayton Act, as amended, 15 U.S.C. Sec. 18. The Complaint alleges 
that the acquisition will result in News Corp's KSTU-TV, a FOX 
affiliate, and Chris-Craft's KTVX-TV, an ABC affiliate, being under New 
Corp's ownership and control. These two stations together account for 
approximately 40% of the broadcast television spot advertising revenue 
in the Salt Lake City market and currently compete vigorously against 
one another because local and national business consumers find them 
close substitute due to the demographic reach of the stations.
    As alleged in the Complaint, the proposed transaction would likely 
lead to higher prices for advertisers who

[[Page 30003]]

purchase broadcast television spot advertising in the Salt Lake City 
market. Accordingly, the prayer for relief in the Complaint seeks: (a) 
adjudication that News Corp's proposed acquisition of Chris-Craft 
described in the Complaint would violate Section 7 of the Clayton Act; 
(b) preliminary and permanent injunctive relief preventing the 
consummation of the proposed acquisition; (c) an award to the United 
States of the costs of this action; and (d) such other relief as is 
just and proper.
    Shortly before the Complaint was filed, the United States reached a 
proposed settlement that would permit News Corp and Chris-Craft to 
consummate their acquisition provided that they divest KTVX-TV, the 
television station News Corp will acquire from Chris-Craft in Salt Lake 
City. The settlement consists of a proposed Final Judgment and a Hold 
Separate Stipulation and Order, which were filed simultaneously with 
the Complaint on April 11, 2001. The United States 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 this action, except that the Court would retain jurisdiction 
to construe, modify, or enforce the provisions of the proposed Final 
Judgment, and a punish violations thereof.

II. The Alleged Violation

A. The Defendants
    News Corp is a foreign corporation existing under the laws of 
Australia and has its headquarters and principal place of business in 
Sydney, New South Wales, Australia. News Corp, through its subsidiary, 
FOX, owns 23 television stations in the United States. News Corp also 
owns cable and satellite distribution businesses and produces films for 
the television and the motion picture industries. FOX is a corporation 
existing under the laws of Delaware with its headquarters in Los 
Angeles, California. Through its subsidiaries, FOX owns and operates 
television stations in the United States, including KSTU-TV in Salt 
Lake City.
    Chris-Craft is a corporation existing under the laws of Delaware 
with its headquarters in New York, New York. Chris-Craft, through its 
subsidiaries, BHC and United Television, owns and operates 10 
television stations in the United States, including KTVX-TV in Salt 
Lake City.
B. Description of the Events Giving Rise to the Alleged Violation
    On August 13, 2000, News Corp; News Publishing Australia Ltd., a 
subsidiary of News Corp; FOX; and Chris-Craft, and its subsidiaries, 
BHC and United Television, entered into a $5.3 billion plan of merger 
under which News Corp would acquire Chris-Craft, BHC, and United 
Television. This proposed acquisition, which would lessen competition 
substantially in the provision of broadcast television spot advertising 
time in the Salt Lake City market, precipitated the United State's 
antitrust suit.
C. Anticompetitive Consequences of the Proposed Acquisition
    1. The Sale of Broadcast Television Spot Advertising Time in the 
Salt Lake City DMA. The Complaint alleges that the provision of spot 
advertising time on broadcast television stations serving the Salt Lake 
City DMA\1\ constitutes a relevant product market under Section 7 of 
the Clayton Act. Broadcast television spot advertising comprises the 
majority of a broadcast television station's revenues and is sold 
either directly by the station, or through its national representative, 
or a localized, market-by-market basis. It is purchased by advertisers 
who want to target potential customers in specific geographic markets 
and differs from network and syndicated television advertising, both of 
which are sold by the major television networks and producers of 
syndicated programs on a nationwide basis and broadcast in every market 
where the network or syndicated program is aired.
---------------------------------------------------------------------------

    \1\ A ``DMA,'' or designated marketing area is a geographic unit 
defined by A.C. Nielsen Company, a firm that surveys television 
viewers and furnishes television stations, advertisers, and 
advertising agencies in a particular area with data to aid in 
evaluating audience size and composition. The Salt Lake City DMA 
generally encompasses the state of Utah.
---------------------------------------------------------------------------

    Broadcast television spot advertising possesses unique attributes 
that set it apart from advertising using other types of media. In 
particular, only television combines sight, sound, and motion, thereby 
creating a more memorable advertisement. Moreover, of all media, 
broadcast television spot advertising reaches the largest percentage of 
all potential customers in a particular target market and is therefore 
especially effective in introducing and establishing the image of a 
product. For a significant number of advertisers, broadcast television 
spot advertising, because of its unique attributes, is an advertising 
medium for which there is no close substitute. Such customers would not 
switch to another advertising medium--such as radio, cable, or 
newspaper--if broadcast television spot advertising prices increased by 
a small but significant amount.
    Even though some advertisers may switch some of their advertising 
to other media rather than absorb an increase in the price of broadcast 
television spot advertising, the existence of such advertisers would 
not prevent stations from profitably raising their prices a small but 
significant amount. During individualized negotiations between 
advertisers and broadcast television stations, advertisers provide 
stations with information about their advertising needs, including 
their target audience. This enables television stations to identify 
advertisers with strong preferences for broadcast television 
advertising. At a minimum, broadcast television stations could 
profitably raise prices to those advertisers who view broadcast 
television as a necessary advertising medium either as their sole 
method of advertising or as a necessary complement to other advertising 
media. Thus, the complaint alleges that the relevant product market in 
which to assess the competitive effects of this acquisition is the sale 
of broadcast television spot advertising.
    The complaint further alleges that the Salt Lake City DMA 
constitutes a relevant geographic market within the meaning of Section 
7 of the Clayton Act. Signals from broadcast television stations 
located in Salt Lake City reach viewers throughout the Salt Lake City 
DMA, but signals from broadcast television stations located outside the 
Salt Lake City DMA reach few viewers within the Salt Lake City DMA. 
Advertiser's use broadcast television stations within the Salt Lake 
City DMA to reach the largest possible number of viewers within the 
entire DMA. Some of these advertisers are located in the Salt Lake City 
DMA and need to reach customers there while others are regional or 
national businesses that want to target consumers in the Salt Lake City 
DMA. Advertising on television stations outside the Salt Lake City DMA 
therefore is not an alternative for these advertisers because such 
stations cannot be viewed by a significant number of potential 
customers within the DMA.
    2. Harm to Competition in the Salt Lake City DMA. The Complaint 
alleges that News Corp's acquisition of Chris-Craft will likely have 
the following effects:
    a. competition in the sale of broadcast television spot advertising 
in the Salt Lake City DMA would be a substantially lessened;

[[Page 30004]]

    b. actual and potential competition between KSTU-TV and KTVX-TV in 
the sale of broadcast television spot advertising in the Salt Lake City 
DMA would be eliminated; and
    c. the prices for broadcast television spot advertising in the Salt 
Lake City DMA would likely increase.
    Specifically, the proposed acquisition would give News Corp 
ownership of two of the top four broadcast stations in the Salt Lake 
City DMA and would increase its market share of broadcast television 
spot advertising revenue from approximately 21% to 40%. The acquisition 
would also further concentrate the already highly concentrated Salt 
Lake City market by increasing the Herfindahl-Hirschman Index (``HHI'') 
(a measure of market concentration explained in Appendix A of the 
Complaint) by 785 points. Furthermore, the Complaint alleges that KSTU-
TV and KTVX-TV compete head-to-head against each other in the sale of 
broadcast television spot advertising, largely because the demographic 
appeal of their programming makes them close substitutes for a 
significant number of advertisers. Advertisers are able to ``play off'' 
KSTU-TV and KTVX-TV against each other and obtain competitive rates for 
programs that target similar demographics. After the acquisition, a 
significant number of advertisers will be unable to reach their desired 
audiences with equivalent efficiency unless they use News Corp's 
stations. The acquisition, therefore, would enable News Corp 
unilaterally to raise prices.
    3. Entry. The Complaint alleges that entry is unlikely to be 
timely, likely, or sufficient to restore the competition lost through 
the acquisition. Other broadcast television stations in the Salt Lake 
City DMA would not change their programming in response to a price 
increase imposed by News Corp after the acquisition. Programming 
schedules are complex and carefully constructed taking many factors 
into account, such as audience flow, station identity, and program 
popularity. As a result, a television station is unlikely to risk 
repositioning simply to capitalize on a small but significant price 
increase by News Corp after the acquisition.
    Further, new entry into the Salt Lake City DMA is unlikely inasmuch 
as the Federal Communications Commission (``FCC'') regulates entry 
through the issuance of licenses, which are difficult to obtain. Even 
if a new signal became available, commercial success would come over a 
period of many years at best. Thus, entry into the Salt Lake City DMA 
broadcast television spot advertising market would not be timely, 
likely, or sufficient to deter News Corp from unilaterally raising 
prices.

III. Explanation of the Proposed Final Judgment

A. Divestiture and Hold Separate Provisions
    The proposed Final Judgment will preserve competition in the sale 
of broadcast television spot advertising time in the Salt Lake City DMA 
by requiring the defendants to divest KTVX-TV, the Salt Lake City 
television station that News Corp will acquire as a result of the 
acquisition. The sale of KTVX-TV will eliminate completely the overlap 
created in Salt Lake City by the acquisition thereby completely 
restoring the pre-merger market structure and resolving any competitive 
concerns.
    The divestiture requirements of the proposed Final Judgment, as 
stated in Section IV, direct defendants to divest KTVX-TX within one 
hundred fifty (150) days after filing of the Complaint or five (5) days 
after notice of the entry of the Final Judgment by the Court, whichever 
is later. The divestiture must be made to a buyer that in the United 
States' sole judgment has the intent and capability of competing 
effectively in the commercial television broadcast business in the Salt 
Lake City market. The United States, in the exercise of its sole 
discretion, may extend this time for two additional thirty (30) day 
periods. Defendants must use their best efforts to divest KTVX-TV as 
expeditiously as possible and, until the ordered divestiture takes 
place, the defendants must cooperate with any prospective purchasers.
    Under the Hold Separate Stipulation and Order, until the ordered 
divestiture takes place, defendants shall preserve, maintain, and 
continue to operate KTVX-TX as a competitively independent, ongoing 
economically viable competitive business, with its assets, management, 
decision-making functions, and operations separate, distinct, and apart 
from KSTU-TV's and News Corp's other operations.
B. Trustee Provisions
    In the event defendants fail to make the required divestiture of 
KTVX-TV within the time periods set forth in the proposed Final 
Judgment, a trustee will be appointed by the Court to effect the 
divestiture. News Corp will pay all costs and expenses of any trustee 
and of any professionals and agents retained by the trustee. After 
appointment, the trustee will report monthly to the United States, News 
Corp, and the Court on its efforts to accomplish the required 
divestiture. If the trustee has not accomplished the divestiture within 
six (6) months of its appointment, it shall inform the Court of its 
efforts to accomplish the required divestiture, the reasons the 
required divestiture has not been accomplished, and the trustee's 
recommendations.
C. Ban on Reacquisition
    The defendants may not reacquire or enter into any local marketing 
agreement, joint sales agreement, or any other cooperative selling 
arrangement with respect to KTVX-TV during the term of the consent 
decree, which is for 10 years unless extended by the Court. The 
reacquisition of KTVX-TV, as well as arrangements whereby News Corp 
would manage KTVX-TV or sell advertising time in coordination with (or 
on behalf of) KTVX-TV would undermine, if not negate, the benefits of 
the relief obtained in the Salt Lake City DMA. Accordingly, this 
provision is necessary to protect the integrity of the relief.
    The relief in the proposed Final Judgment is intended to remedy the 
likely anticompetitive effects of News Corp's proposed acquisition of 
Chris-Craft in the broadcast television spot advertising market in the 
Salt Lake City DMA. Nothing in the Final Judgment is intended to limit 
the United States' ability to investigate or to bring actions, where 
appropriate, challenging other past or future activities of defendants 
in any other markets.

IV. Remedies Available to Potential Private Litigants

    Section 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 times 
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. 
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 the 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.

[[Page 30005]]

    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date 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 United States Department of Justice, which remains 
free to withdraw its consent to the proposed Final Judgment at any time 
prior to its entry. The United States will evaluate and respond to the 
comments. The comments and the response of the United States will be 
filed with the Court and published in the Federal Register.
    Any such written comments should be submitted to: J. Robert Kramer, 
II, Chief, Litigation II Section, Antitrust Division, United States 
Department of Justice, 1401 H Street, NW., Suite 3000, Washington, DC 
20530.
    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, as well as to 
punish violations of its provisions.

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 of its Complaint against 
defendants. The United States could have continued the litigation and 
sought preliminary and permanent injunctions against News Corp's 
acquisition of Chris-Craft. The United States is satisfied, however, 
that the divestiture of KTVX-TV and other relief contained in the 
proposed Final Judgment will preserve competition in the sale of the 
broadcast television spot advertising in the Salt Lake City DMA. Thus, 
the United States is convinced that the proposed Final Judgment, once 
implemented by the Court, will prevent News Corp's acquisition of 
Chris-Craft from having adverse competitive effects.

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

    The APPA requires that the proposed consent judgments in antitrust 
cases brought by the United States be subject to a sixty (60) 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 
considerations bearing upon the adequacy of such judgment;
    (2) The impact of entry of such judgment upon the public 
generally and individuals alleging specific injury 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). As the United States Court of Appeals for the District 
of Columbia Circuit 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 device may positively harm third parties. 
See United States v. Microsoft Corp., 56 F.3d 1448, 1458-62 (D.C. Cir. 
1995).
    In conducting this inquiry, ``the Court is nowhere compelled to go 
to 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.'' \2\ Rather,
---------------------------------------------------------------------------

    \2\ 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, see  15 U.S.C. Sec. 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. Rep. 93-1463, at 8-9 (1974), reprinted in 1974 U.S.C.C.A.N. 
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 responses 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. para. 
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 F.2d 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 at 1458-62. Precedent requires 
that:

The balancing of competing social and political interests 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.\3\
---------------------------------------------------------------------------

    \3\ Bechtel, 648 F.2d at 666 (citations omitted)(emphasis 
added); see BNS, 858 F2d at 463; United States v. National Broad, 
Co., 449 F. Supp. 1127, 1143 (C.D. Cal. 1978); Gillette, 406 F. 
Supp. at 716; see also Microsoft, 56 F.3d at 1461 (whether ``the 
remedies [obtained in the decree are] so inconsonant with the 
allegations charged as to fall outside of the `reaches of the public 
interest' '' (citations omitted)).

    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 
certainty 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 it 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.' '' \4\
---------------------------------------------------------------------------

    \4\ United States v. American Tel. and Tel. Co., 552 F. Supp. 
131, 151 (D.D.C. 1982), aff'd sub nom. Maryland v. United States, 
460 U.S. 1001 (1983) (quoting Gillette Co., 406 F. Supp. at 716); 
see also United States v. Alcan Aluminum, Ltd., 605 F. Supp. 619, 
622 (W.D. Ky. 1985).
---------------------------------------------------------------------------

    Moreover, the Court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its Complaint, and does not authorize the Court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459. Because the ``Court's 
authority to review the decree depends entirely on the government's 
exercising its prosecutorial discretion by bringing a case in the first 
place,'' it follows that the court ``is only authorized to review the 
decree itself,'' and not to ``effectively redraft the complaint'' to 
inquire into other matters that the United States might have, but did 
not pursue. Id.

[[Page 30006]]

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.

    Dated: May 14, 2001.
    Respectfully submitted,

Carolyn L. Davis,
Trial Attorney, Litigation II Section, Antitrust Division, U.S. 
Department of Justice, 1401 H Street, N.W., Suite 3000, Washington, 
D.C. 20530, (202) 514-5815.

Certificate of Service

    I hereby certify under penalty of perjury that copies of the 
COMPETITIVE IMPACT STATEMENT have been served upon The News Corporation 
Limited; FOX Television Holdings, Inc., and Chris-Craft Industries, 
Inc., by placing copies of the aforementioned documents in the U.S. 
Mail, directed to each of the above-named parties at the addresses 
given below, this 14th day of May 2001.

The News Corporation Limited and FOX Television Holdings, Inc., c/o 
Lloyd Constantine, Constantine & Partners, 477 Madison Avenue, New 
York, NY 10022.
Chris-Craft Industries, Inc., c/o Neal Stoll, Skadden, Arps, Slate, 
Meagher & Flom LLP, Four Times Square, New York, NY 10036.

Carolyn L. Davis,
Senior Trial Attorney, United States Department of Justice, 
Antitrust Division, 1401 H Street, N.W., Suite 3000, Washington, 
D.C. 20530, (202) 514-5815.
[FR Doc. 01-13863 Filed 6-1-01; 8:45 am]
BILLING CODE 4410-11-M
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