Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices 13993

According to the draft complaint, these

markets are highly concentrated and

entry is difficult or unlikely. Schnucks’

acquisition of National may reduce

competition in these markets by

eliminating the direct competition

between Schnucks and National, by

increasing the likelihood that Schnucks

will become a dominant firm, and by

increasing the likelihood of collusive

behavior among the remaining

competitors.

The agreement containing consent

order attempts to remedy the

Commission’s competitive concerns

about the acquisition. Under the terms

of the proposed order, Schnucks must

divest 24 supermarkets within twelve

months, to a purchaser approved by the

Commission. If Schnucks fails to satisfy

the divestiture provisions, the

Commission may appoint a trustee to

divest supermarkets to satisfy the terms

of the order. The 24 supermarkets to be

divested are:

1. The following supermarkets located

in the city of St. Louis, Missouri:

a. National store No. 15 located at 2700

S. Grand Avenue, St. Louis, MO

63118;

b. National store No. 30 located at 5433

Southwest Avenue, St. Louis, MO

63139;

c. National store No. 50 located at 8945

Riverview Drive, St. Louis, MO 63137;

and

d. National store No. 60 located at 1605

S. Jefferson, St. Louis, MO 63104.

2. The following supermarkets located

in St. Louis County, Missouri:

a. National store No. 26 located at 8823

Ladue Road, Ladue MO 63124;

b. National store No. 45 located at 6 S.

Old Orchard, Webster, MO 63119;

c. National store No. 46 located at 10431

St. Charles, St. Ann, MO 63074;

d. National store No. 47 located at 13041

New Halls Ferry, Florissant, MO

63033;

e. National store No. 62 located at 421

N. Kirkwood Road, Kirkwood, MO

63122;

f. National store No. 63 located at 7434

Olive Street Road, University City,

MO 63130;

g. National store No. 77 located at 4432

Lemay Ferry Road, Mehlville, MO

63129;

h. National store No. 85 located at 14855

Clayton Road, Chesterfield, MO

63011;

i. Schnucks store No. 103 located at

9719 Crestwood Road, Crestwood,

MO 63126;

j. Schnucks store No. 124 located at

3661 Reavis Barracks, St. Louis, MO

63125;

k. Schnucks store No. 130 located at

10223 Lewis & Clark, Bellefontaine,

MO 63136; and

l. Schnucks store No. 195 located at

6965 Parker Road, St. Louis, MO

63033.

3. The following supermarkets located

in St. Charles County, Missouri:

a. National store No. 22 located at 850

Jungerman, St. Peters, MO 63376; and

b. Schnucks store No. 126 located at

1355 South 5th Street, St. Charles,

MO 63301.

4. The following supermarkets located

in Jefferson County, Missouri:

a. National store No. 65 located at 1200

Sugar Creek Square, Fenton, MO

63026; and

b. National store No. 70 located at 215

Arnold Cross Road, Arnold MO

63010.

5. The following supermarkets located

in Madison County, Illinois:

a. National store No. 35 located at 1716

Vandalia Road, Collinsville, IL 62234;

and

b. Schnucks store No. 175 located at

1435 Vaughn Road, Wood River, IL

62095.

6. The following supermarkets located

in St. Clair County, Illinois:

a. National store No. 64 located at 1290

Camp Jackson Road, Cahokia, IL

62206; and

b. National store No. 80 located at 4

Market Place, Fairview Heights, IL

62208

For a period of ten years from the date

the order becomes final, the order also

prohibits Schnucks from acquiring,

without prior Commission approval,

supermarket assets located in, or any

interest (such as stock) in any entity that

owns or operates a supermarket located

in, the St. Louis MSA. This does not

prevent Schnucks from constructing

new supermarket facilities on its own;

nor does it prevent Schnucks from

leasing facilities not operated as

supermarkets within the previous six

months.

For a period of ten years, if Schnucks

sells or leases a supermarket to another

person, Schnucks may not enter into or

enforce any agreement that would

restrict the ability of that person to

operate a supermarket. In addition,

subject to certain exceptions, Schnucks

may not remove any equipment from a

supermarket it owns or operates prior to

a sale, sublease, assignment, or change

in occupancy.

The respondent is required to provide

to the Commission a report of

compliance with the order within sixty

(60) days following the date the order

becames final, every sixty (60) days

thereafter until the divestitures are

completed, and annually for a period of

ten years.

The purpose of this analysis is to

invite public comment on the proposed

consent order to aid the Commission in

its determination of whether it should

make final the proposed consent order

contained in the agreement.

This analysis is not intended to

constitute an official interpretation of

the agreement and proposed consent

order, nor is it intended to modify the

terms of the agreement and proposed

consent order in any way.

Donald S. Clark,

Secretary.

Concurring Statement of Commissioner

Mary L. Azcuenaga

Re: Schnuck Markets, Inc., File No. 941–

0131; Schwegmann Giant Super

Markets, Inc., File No. 941–0130

The two complaints allege geographic

markets comprising ‘‘the St. Louis MSA,

and narrower markets contained

therein’’ and ‘‘metro New Orleans,

Louisiana area, which consists of the

parishes of Orleans, Jefferson, and St.

Bernard, and narrower markets

contained therein.’’ Although I question

the board geographic markets alleged,

the investigational record contains

sufficient information to support a

finding of reason to believe with respect

to small, discrete geographic markets

located within the broad regions alleged

in the complaint, and the stores to be

divested were selected with a view to

remedying competitive concerns in the

small, discrete markets.

In addition, the complaints allege as

the product market ‘‘the retail sale of

food and grocery products in

supermarkets, and narrow markets

contained therein.’’ A serious argument

can be made that the market should

include sales of food and groceries in

certain stores other than traditional

supermarkets. Since the investigational

record suggests that the concentration is

high even if additional sales are

included in the market, the issue need

not be resolved at this time.

Accordingly, I concur in the decision to

accept the consent agreements for

publication.

[FR Doc. 95–6342 Filed 3–14–95; 8:45 am]

BILLING CODE 6750–01–M

[File No. 941 0130]

Schwegmann Giant Super Markets,

Inc.; Proposed Consent Agreement

With Analysis to Aid Public Comment

AGENCY: Federal Trade Commission.
13994 Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices

ACTION: Proposed consent agreement.

SUMMARY: In settlement of alleged

violations of federal law prohibiting

unfair acts and practices and unfair

methods of competition—in connection

with Schwegmann’s proposed

acquisition of supermarkets currently

owned by National Holdings, Inc.—this

consent agreement, accepted subject to

final Commission approval, would

require, among other things, the

Louisiana-based corporation to divest

seven stores in the New Orleans area to

Commission-approved purchasers, and

would require the respondent, for ten

years, to obtain Commission approval

before acquiring an interest in a

supermarket, or another entity that

operates a supermarket, in the relevant

area.

DATES: Comments should be received on

or before May 15, 1995.

ADDRESSES: Comments should be

directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., NW.,

Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:

Ronald Rowe, FTC/S–2105,

Washington, DC 20580. (202) 326–2610.

SUPPLEMENTARY INFORMATION: Pursuant

to Section 6(f) of the Federal Trade

Commission Act, 38 Stat. 721, 15 U.S.C.

46 and § 2.34 of the Commission’s Rules

of Practice (16 CFR 2.34), notice is

hereby given that the following consent

agreement containing a consent order to

cease and desist, having been filed with

and accepted, subject to final approval,

by the Commission, has been placed on

the public record for a period of sixty

(60) days. Public comment is invited.

Such comments or views will be

considered by the Commission and will

be available for inspection and copying

at its principal office in accordance with

§ 4.9(b)(6)(ii) of the Commission’s Rules

of Practice (16 CFR 4.9(b)(6)(ii)).

Agreement Containing Consent Order

The Federal Trade Commission

(‘‘Commission’’) having initiated an

investigation of Schwegmann Giant

Super Markets, Inc.’s (‘‘Schwegmann’’)

proposed acquisition of certain assets of

National Holdings, Inc. and certain

affiliates (‘‘National’’), and it now

appearing that Schwegmann, hereinafter

sometimes referred to as ‘‘proposed

respondent,’’ is willing to enter into an

agreement containing an Order to divest

certain assets and to cease and desist

from certain acts, and providing for

other relief.

It is hereby agreed by and among

proposed respondent, its duly

authorized officers and attorneys, and

counsel for the Commission that:

1. Proposed respondent Schwegmann

Giant Super Markets, Inc. is a

corporation organized, existing, and

doing business under and by virtue of

the laws of the State of Louisiana, with

its office and principal place of business

located at 5300 Old Gentilly Road, New

Orleans, Louisiana 70126.

2. Proposed respondent admits all the

jurisdictional facts set forth in the draft

of complaint.

3. Proposed respondent waives:

a. Any further procedural steps;

b. The requirement that the

Commission’s decision contain a

statement of findings of fact and

conclusions of law;

c. All rights to seek judicial review or

otherwise to challenge or contest the

validity of the Order entered pursuant to

this agreement; and

d. Any claim under the Equal Access

to Justice Act.

4. This agreement shall not become

part of the public record of the

proceeding unless and until it is

accepted by the Commission. If this

agreement is accepted by the

Commission it, together with the draft of

complaint contemplated thereby, will be

placed on the public record for a period

of sixty (60) days and information in

respect thereto publicly released. The

Commission thereafter may either

withdraw its acceptance of this

agreement and so notify the proposed

respondent, in which event it will take

such action as it may consider

appropriate, or issue and serve its

complaint (in such form as the

circumstances may require) and

decision, in disposition of the

proceeding.

5. This agreement is for settlement

purposes only and does not constitute

an admission by proposed respondent

that the law has been violated as alleged

in the draft of the complaint, or that the

facts as alleged in the draft complaint,

other than jurisdictional facts, are true.

6. This agreement contemplates that,

if it is accepted by the Commission, and

if such acceptance is not subsequently

withdrawn by the Commission pursuant

to the provisions of § 2.34 of the

Commission’s Rules, the Commission

may, without further notice to the

proposed respondent, (1) issue its

complaint corresponding in form and

substance with the draft of the

complaint and its decision containing

the following Order to divest and to

cease and desist in disposition of the

proceeding, and (2) make information

public with respect thereto. When so

entered, the Order shall have the same

force and effect and may be altered,

modified, or set aside in the same time

provided by statute for other orders. The

Order shall become final upon service.

Delivery by the United States Postal

Service of the complaint and decision

containing the agreed-to Order to

proposed respondent’s address as stated

in this Agreement, to the attention of the

officer signing this agreement, shall

constitute service. Proposed respondent

waives any right it may have to any

other manner of service. The complaint

may be used in construing the terms of

the Order, and no agreement,

understanding, representation, or

interpretation not contained in the

Order or the Agreement may be used to

vary or contradict the terms of the

Order.

7. Proposed respondent has read the

proposed complaint and Order

contemplated hereby. Proposed

respondent understands that once the

Order has been issued, it will be

required to file verified written reports

showing that it has fully complied with

the Order. Proposed respondent further

understands that it may be liable for

civil penalties in the amount provided

by law for each violation of the Order

after it becomes final.

Order

I

It is ordered that, as used in this

Order, the following definitions shall

apply:

A. Respondent or Schwegmann means

John F. Schwegmann and Schwegmann

Giant Super Markets, Inc., its

predecessors, subsidiaries, divisions,

and groups and affiliates controlled by

Schwegmann Giant Super Markets, Inc.,

their successors and assigns, and their

directors, officers, employees, agents,

and representatives.

B. Assets to be divested means the

supermarket assets described in

Paragraph II.A. of this Order.

C. Commission means the Federal

Trade Commission.

D. Supermarket means a full-line

retail grocery store that carries a wide

variety of food and grocery items in

particular product categories, including

bread and dairy products; refrigerated

and frozen food and beverage products;

fresh and prepared meats and poultry;

produce, including fresh fruits and

vegetables; shelf-stable food and

beverage products, including canned

and other types of packaged products;

staple foodstuffs, which may include

salt, sugar, flour, sauces, spices, coffee,

and tea; and other grocery products,

including nonfood items such as soaps,

detergents, paper goods, other

household products, and health and

beauty aids.
Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices 13995

E. New Orleans metro area means the

area consisting of Jefferson, Orleans, and

St. Bernard parishes in Louisiana.

II

It is further ordered that:

A. Respondent shall divest, absolutely

and in good faith, within twelve months

from the date this Order becomes final:

1. That Stanley supermarket located at

315 E. Judge Perez Drive (store No.

79), Chalmette, LA;

2. Canal Villere supermarket located at

4726 Paris Avenue (store No. 24),

New Orleans, LA;

3. Canal Villere supermarket located at

2125 Caton Street (store No. 25), New

Orleans, LA;

4. That Stanley supermarket located at

4223 Chef Menteur Highway (store

No. 8), New Orleans, LA;

5. That Stanley supermarket located at

9319 Jefferson Highway (store No. 33),

River Ridge, LA;

6. Canal Villere supermarket located at

5245 Veterans Memorial Boulevard

(store No. 93), Metairie, LA; and

7. Canal Villere supermarket located at

135 Robert E. Lee Boulevard (store

No. 83), New Orleans, LA.

The assets to be divested shall include

the supermarket business operated, and

all assets, leases, properties, business

and goodwill, tangible and intangible,

utilized in the supermarket operations

at the locations listed above, but shall

not include those assets consisting of or

pertaining to any Schwegmann or

National trade names, trade dress, trade

marks, service marks, computer

software, vehicles and other assets

except fixtures also used or to be used

by respondent at locations other than

those listed above in connection with

the Schwegmann or National business

operations.

B. Respondent shall divest the assets

to be divested only to an acquirer or

acquirers that receive the prior approval

of the Commission and only in a

manner that receives the prior approval

of the Commission. The purpose of the

divestiture is to ensure the continuation

of the assets to be divested as ongoing

viable enterprises engaged in the

supermarket business and to remedy the

lessening of competition resulting from

the acquisition alleged in the

Commission’s complaint.

C. Pending divestiture of the assets to

be divested, respondent shall take such

actions as are necessary to maintain the

viability, competitiveness, and

marketability of the assets to be divested

to comply with Paragraphs II and III of

this Order and to prevent the

destruction, removal, wasting,

deterioration, or impairment of the

assets to be divested except in the

ordinary course of business and except

for ordinary wear and tear.

D. Respondent shall comply with all

the terms of the Asset Maintenance

Agreement attached to this Order and

made a part hereof as Appendix I. The

Asset Maintenance Agreement shall

continue in effect until such time as all

assets to be divested have been divested

as required by this Order.

III

It is further ordered that:

A. If respondent has not divested,

absolutely and in good faith and with

the Commission’s prior approval, the

assets to be divested within twelve

months from the date this Order

becomes final, the Commission may

appoint a trustee to divest any of the

assets to be divested. In the event that

the Commission or the Attorney General

brings an action pursuant to section 5(l)

of the Federal Trade Commission Act,

15 U.S.C. 45(l), or any other statute

enforced by the Commission,

respondent shall consent to the

appointment of a trustee in such action.

Neither the appointment of a trustee nor

a decision not to appoint a trustee under

this Paragraph shall preclude the

Commission or the Attorney General

from seeking civil penalties or any other

relief available to it, including a courtappointed trustee, pursuant to § 5(l) of

the Federal Trade Commission, for any

failure by the respondent to comply

with this Order.

B. If a trustee is appointed by the

Commission or a court pursuant to

Paragraph III.A. of this Order,

respondent shall consent to the

following terms and conditions

regarding the trustee’s powers, duties,

authority, and responsibilities:

1. The Commission shall select the

trustee, subject to the consent of

respondent, which consent shall not be

unreasonably withheld. The trustee

shall be a person with experience and

expertise in acquisitions and

divestitures. If respondent has not

opposed, in writing, including the

reasons for opposing, the selection of

any proposed trustee within ten (10)

days after written notice by the staff of

the Commission to respondent of the

identity of any proposed trustee,

respondent shall be deemed to have

consented to the selection of the

proposed trustee.

2. Subject to the prior approval of the

Commission, the trustee shall have the

exclusive power and authority to divest

the assets to be divested.

3. Within ten (10) days after

appointment of the trustee, respondent

shall execute a trust agreement that,

subject to the prior approval of the

Commission and, in the case of a courtappointed trustee, of the court, transfers

to the trustee all rights and powers

necessary to permit the trustee to effect

the divestitures required by this Order.

4. The trustee shall have twelve (12)

months from the date the Commission

or court approves the trust agreement

described in Paragraph III. B. 3. to

accomplish the divestitures, which shall

be subject to the prior approval of the

Commission. If, however, at the end of

the twelve-month period, the trustee has

submitted a plan of divestiture or

believes that divestiture can be achieved

within a reasonable time, the divestiture

period may be extended by the

Commission, or, in the case of a courtappointed trustee, by the court;

provided, however, the Commission

may extend this 12-month period only

one (1) time for one (1) year.

5. The trustee shall have full and

complete access to the personnel, books,

records, and facilities related to the

assets to be divested or to any other

relevant information, as the trustee may

request. Respondent shall develop such

financial or other information as such

trustee may reasonably request and shall

cooperate with the trustee. Respondent

shall take no action to interfere with or

impede the trustee’s accomplishment of

the divestitures. Any delays in

divestiture caused by respondent shall

extend the time for divestiture under

this Paragraph in an amount equal to the

delay, as determined by the Commission

or, for a court-appointed trustee, by the

court.

6. The trustee shall use his or her best

efforts to negotiate the most favorable

price and terms available in each

contract that is submitted to the

Commission, subject to respondent’s

absolute and unconditional obligation to

divest at no minimum price. The

divestitures shall be made in the

manner and to the acquirer or acquirers

as set out in Paragraph II of this Order;

provided, however, if the trustee

receives bona fide offers for an asset to

be divested from more than one

acquiring entity, and if the Commission

determines to approve more than one

such acquiring entity, the trustee shall

divest such asset to the acquiring entity

or entities selected by respondent from

among those approved by the

Commission.

7. The trustee shall serve, without

bond or other security, at the cost and

expense of respondent, on such

reasonable and customary terms and

conditions as the Commission or a court

may set. The trustee shall have the

authority to employ, at the cost and

expense of respondent, such
13996 Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices

consultants, accountants, attorneys,

investment bankers, business brokers,

appraisers, and other representatives

and assistants as are necessary to carry

out the trustee’s duties and

responsibilities. The trustee shall

account for all monies derived from the

sale and all expenses incurred. After

approval by the Commission and, in the

case of a court-appointed trustee, by the

court, of the account of the trustee,

including fees for his or his services, all

remaining monies shall be paid at the

direction of the respondent, and the

trustee’s power shall be terminated. The

trustee’s compensation shall be based at

least in significant part on a commission

arrangement contingent on the trustee’s

divesting the assets to be divested to

satisfy Paragraph II of this Order.

8. Respondent shall indemnify the

trustee and hold the trustee harmless

against any losses, claims, damages,

liabilities, or expenses arising out of, or

in connection with, the performance of

the trustee’s duties, including all

reasonable fees of counsel and other

expenses incurred in connection with

the preparation for, or defense of any

claim, whether or not resulting in any

liability, except to the extent that such

liabilities, losses, damages, claims, or

expenses result from misfeasance, gross

negligence, willful or wanton acts, or

bad faith by the trustee.

9. If the trustee ceases to act or fails

to act diligently, a substitute trustee

shall be appointed in the same manner

as provided in Paragraph III.A. of this

Order.

10. The Commission or, in the case of

a court-appointed trustee, the court,

may on its own initiative or at the

request of the trustee issue such

additional Orders or directions as may

be necessary or appropriate to

accomplish the divestiture required by

this Order.

11. The trustee shall have no

obligation or authority to operate or

maintain the assets to be divested.

12. The trustee shall report in writing

to respondent and the Commission

every sixty (60) days concerning the

trustee’s efforts to accomplish

divestiture.

IV

It is further ordered that, for a period

of ten (10) years from the date this Order

becomes final, respondent shall not,

without the prior approval of the

Commission, directly or indirectly,

through subsidiaries, partnerships, or

otherwise:

A. Acquire any ownership or

leasehold interest in any facility that has

operated as a supermarket within six (6)

months of the date of such proposed

acquisition in the New Orleans metro

area.

B. Acquire any stock, share capital,

equity, or other interest in any entity

that owns any interest in or operates any

supermarket or owned any interest in or

operated any supermarket within six (6)

months of such proposed acquisition in

the New Orleans metro area.

Provided, however, that these

prohibitions shall not apply to the

construction of new facilities by

respondent or the acquisition of or

leasing of a facility that has not operated

as a supermarket within six (6) months

of respondent’s offer to purchase or

lease.

V

It is further ordered that, for a period

of ten (10) years commencing on the

date this Order becomes final:

A. Respondent shall neither enter into

nor enforce any agreement that restricts

the ability of any person (as defined in

Section 1(a) of the Clayton Act, 15

U.S.C. 12(a)) acquiring any supermarket

owned or operated by respondent, any

leasehold interest in any supermarket,

or any interest in that portion of any

retail location used as a supermarket on

or after January 1, 1995 in the New

Orleans metro area to operate a

supermarket at that site; provided

however, that nothing in this Paragraph

shall prevent respondent from entering

into or enforcing any agreement

requiring its approval of any sublease,

assignment, or change in occupancy,

which approval shall not be

unreasonably withheld; provided

further that use of a site for the

operation of a supermarket shall not be

a basis for withholding such approval.

B. Respondent shall not remove any

equipment for a supermarket owned or

operated by respondent in the New

Orleans metro area prior to a sale,

sublease, assignment, or change in

occupancy, except for replacement or

relocation of such equipment in or to

any other supermarket owned or

operated by respondent in the ordinary

course of business, or as part of any

negotiation for a sale, sublease,

assignment, or change in occupancy of

such supermarket.

VI

It is further ordered that:

A. Within sixty (60) days after the

date this Order becomes final and every

sixty (60) days thereafter until

respondent has fully complied with the

provisions of Paragraphs II or III of this

Order, respondent shall submit to the

Commission verified written reports

setting forth in detail the manner and

form in which it intends to comply, is

complying, and has complied with

Paragraphs II and III of this Order.

Respondent shall include in its

compliance reports, among other things

that are required from time to time, a

full description of the efforts being

made to comply with Paragraphs II and

III of the Order, including a description

of all substantive contacts or

negotiations for the divestiture and the

identity of all parties contacted.

Respondent shall include in its

compliance reports copies of all written

communications to and from such

parties, all internal memoranda, and all

reports and recommendations

concerning divestiture.

B. One year (1) from the date this

Order becomes final, annually for the

next nine (9) years on the anniversary of

the date this Order becomes final, and

at other times as the Commission may

require, respondent shall file verified

written reports with the Commission

setting forth in detail the manner and

form in which it has complied and is

complying with this Order.

VII

It is further ordered that respondent

shall notify the Commission at least

thirty (30) days prior to any proposed

change in respondent such as

dissolution, assignment, sale resulting

in the emergence of a successor

corporation, or the creation or

dissolution of subsidiaries or any other

change in respondent that may affect

compliance obligations arising out of

the Order.

VIII

It is further ordered that, for the

purpose of determining or securing

compliance with this Order, respondent

shall permit any duly authorized

representative of the Commission:

A. Upon five days’ written notice to

respondent, access, during office hours

and in the presence of counsel for

respondent, to inspect and copy all

books, ledgers, accounts,

correspondence, memoranda and other

records and documents in the

possession or under the control of

respondent relating to any matters

contained in this Order; and

B. Upon five days’ written notice to

respondent and without restraint or

interference from it, to interview

respondent or officers, directors, or

employees of respondent in the

presence of counsel for respondent

relating to any matters contained in this

Order.

Asset Maintenance Agreement

This Asset Maintenance Agreement

(‘‘Agreement’’) is by and between
Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices 13997

Schwegmann Giant Super Markets, Inc.

(‘‘Schwegmann’’), a corporation

organized under the laws of the State of

Louisiana, with its principal offices

located at 5300 Old Gentilly Road, New

Orleans, Louisiana 70126, and the

Federal Trade Commission

(‘‘Commission’’), an independent

agency of the United States

Government, established under the

Federal Trade Commission Act of 1914,

15 U.S.C. § 41, et seq. (collectively ‘‘the

Parties’’).

Premises

Whereas, Schwegmann, pursuant to

an agreement dated November 23, 1994,

agreed to purchase certain assets of

National Holdings, Inc. and certain

affiliates (hereinafter ‘‘Acquisition’’);

and

Whereas, the Commission is now

investigating the Acquisition to

determine if it would violate any of the

statutes enforced by the Commission;

and

Whereas, if the Commission accepts

the attached Agreement Containing

Consent Order, the Commission is

required to place it on the public record

for a period of sixty (60) days for public

comment and may subsequently

withdraw such acceptance pursuant to

the provisions of §§ 2.34 of the

Commission’s Rules; and

Whereas, the Commission is

concerned that if an agreement is not

reached preserving the status quo ante

of the assets to be divested as described

in II.A. of the attached Agreement

Containing Consent Order (‘‘Assets’’)

during the period prior to their

divestitures, when those assets will be

in the hands of Schwegmann, that any

divestiture resulting from any

administrative proceeding challenging

the legality of the Acquisition might not

be possible, or might produce a less

than effective remedy; and

Whereas, the Commission is

concerned that prior to divestiture to the

acquirer, it may be necessary to preserve

the continued viability and

competitiveness of the Assets; and

Whereas, the purpose of this

Agreement and of the Consent Order is

to preserve the Assets pending the

divestiture to the acquirer approved by

the Federal Trade Commission under

the terms of the Order, in order to

remedy any anticompetitive effects of

the Acquisition; and

Whereas, Schwegmann entering into

this Agreement shall in no way be

construed as an admission by

Schwegmann that the Acquisition is

illegal; and

Whereas, Schwegmann understands

that no act or transaction contemplated

by this Agreement shall be deemed

immune or exempt from the provisions

of the antitrust laws, or the Federal

Trade Commission Act by reason of

anything contained in this Agreement;

Now, therefore, in consideration of

the Commission’s agreement that,

unless the Commission determines to

reject the Consent Order, it will not seek

further relief from the parties with

respect to the Acquisition, except that

the Commission may exercise any and

all rights to enforce this Agreement and

the Consent Order annexed hereto and

made a part thereof, and, in the event

the required divestiture is not

accomplished, to appoint a trustee to

seek divestiture of the Assets, the

Parties agree as follows:

Terms of Agreement

1. Schwegmann agrees to execute, and

upon its issuance to be bound by, the

attached Consent Order. The Parties

further agree that each term defined in

the attached Consent Order shall have

the same meaning in this Agreement.

2. Unless the commission brings an

action to seek to enjoin the proposed

Acquisition pursuant to Section 13(b) of

the Federal Trade Commission Act, 15.

U.S.C. § 53(b), and obtains a temporary

restraining order or preliminary

injunction blocking the proposed

Acquisition, Schwegmann will be free

to close the Acquisition after 11:59 p.m.,

March 8, 1995.

3. Schwegmann agrees that from the

date this Agreement is accepted until

the earliest of the dates listed in

subparagraphs 3.a—3.b it will comply

with the provisions of this Agreement:

a. Three business days after the

Commission withdraws its acceptance

of the Consent Order pursuant to the

provisions of § 2.34 of the Commission’s

Rules; or

b. On the day the divestitute set out

in the Consent Order has been

completed.

4. From the time Schwegmann

acquires the Assets until the earliest of

the dates listed in subparagraphs 3.a—

3.b, Schwegmann shall maintain the

viability, competitiveness and

marketability of the Assets, and shall

not cause the wasting or deterioration of

the Assets, nor shall it sell, transfer,

encumber or otherwise impair their

marketability or viability.

5. Should the Commission seek in any

proceeding to compel Schwegmann to

divest itself of the Assets or to seek any

other injunctive or equitable relief,

Schwegmann shall not raise any

objection based upon the expiration of

the applicable Hart-Scott-Rodino

Antitrust Improvements Act waiting

period or the fact that the Commission

has not sought to enjoin the Acquisition.

Schwegmann also waives all rights to

contest the validity of this Agreement.

6. For the purpose of determining or

securing compliance with this

Agreement, subject to any legally

recognized privilege, and upon written

request with reasonable notice to

Schwegmann to its principal offices,

Schwegmann shall permit any duly

authorized representative or

representatives of the Commission:

a. Access during the office hours of

Schwegmann, in the presence of

counsel for Schwegmann, to inspect and

copy all books, ledgers, accounts,

correspondence, memoranda and other

records and documents in the

possession or under the control of

Schwegmann relating to compliance

with this Agreement; and

Without restraint or interference from

them, to interview officers or employees

of Schwegmann, who may have counsel

present, regarding any such matters.

7. This Agreement shall not be

binding until approved by the

Commission.

Analysis of Proposed Consent Order to

Aid Public Comment

The Federal Trade Commission

(‘‘Commission’’) has accepted for public

comment from Schwegmann Giant

Super Markets, Inc. (‘‘Schwegmann’’) an

agreement containing a proposed

consent order. The agreement is

designed to remedy anticompetitive

effects stemming from Schwegmann’s

acquisition of a number of supermarkets

owned by National Holdings, Inc. and

certain affiliates (‘‘National’’).

The agreement has been placed on the

public record for sixty (60) days for

receipt of comments by interested

persons. Comments received during this

period will become part of the public

record. After sixty days, the

Commission will again review the

agreement and the comments received

and will decide whether it should

withdraw from the agreement or make

final the agreement’s proposed order.

The Commission’s draft complaint

charges that on or about November 23,

1994, Schwegmann agreed to acquire

National’s supermarkets located in

Louisiana, Mississippi, and Alabama.

The Commission has reason to believe

that the acquisition, as well as the

agreement to enter into the acquisition,

would substantially lessen competition

in violation of Section 7 of the Clayton

Act, as amended, 15 U.S.C. 18, and

Section 5 of the FTC Act, as amended,

15 U.S.C. 45.

According to the draft complaint,

Schwegmann and National are direct

competitors for the retail sale of food
13998 Federal Register / Vol. 60, No. 50 / Wednesday, March 15, 1995 / Notices

and grocery items in supermarkets, or

narrower product markets contained

therein, in the ‘‘New Orleans metro

area,’’ which consists of the parishes of

Orleans, Jefferson, and St. Bernard, or

narrower geographic markets contained

therein. According to the draft

complaints, the relevant markets are

highly concentrated and entry is

difficult or unlikely. Schwegmann’s

acquisition of National may reduce

competition in these markets by

eliminating the direct competition

between Schwegmann and National, by

increasing the likelihood that

Schwegmann will become a dominant

firm, and by increasing the likelihood of

collusive behavior among the remaining

competitors.

The agreement containing consent

order attempts to remedy the

Commission’s competitive concerns

about the acquisition. Under the terms

of the proposed order, Schwegmann

must divest seven supermarkets within

twelve months, to a purchaser approved

by the Commission. If Schwegmann

fails to satisfy the divestiture provisions,

the Commission may appoint a trustee

to divest supermarkets to satisfy the

terms of the order. The seven

supermarkets to be divested are:

1. That Stanley supermarket located at

315 E. Judge Perez Drive (store No.

79), Chalmette, LA;

2. Canal Villere supermarket located at

4726 Paris Avenue (store No. 24),

New Orleans, LA;

3. Canal Villere supermarket located at

2125 Caton Street (store No. 25), New

Orleans, LA;

4. That Stanley supermarket located at

4223 Chef Menteur Highway (store

No. 8), New Orleans, LA;

5. That Stanley supermarket located at

9319 Jefferson Highway (store No. 33),

River Ridge, LA;

6. Canal Villere supermarket located at

5245 Veterans Memorial Boulevard

(store No. 93), Metairie, LA;

7. Canal Villere supermarket located at

135 Robert E. Lee Boulevard (store

No. 83), New Orleans, LA.

For a period of ten years from the date

the order becomes final, the order also

prohibits Schwegmann from acquiring,

without prior Commission approval,

supermarket assets located in, or any

interest (such as stock) in any entity that

owns or operates a supermarket located

in, the New Orleans metro area. This

does not prevent Schwegmann from

constructing new supermarket facilities

on its own; nor does it prevent

Schwegmann from leasing facilities not

operated as supermarkets within the

previous six months.

For a period of ten years, if

Schwegmann sells or leases a

supermarket to another person,

Schwegmann may not enter into or

enforce any agreement that would

restrict the ability of that person to

operate a supermarket. In addition,

subject to certain exceptions,

Schwegmann may not remove any

equipment from a supermarket it owns

or operates prior to a sale, sublease,

assignment, or change in occupancy.

The respondent is required to provide

to the Commission a report of

compliance with the order within sixty

(60) days following the date the order

becomes final, every sixty (60) days

thereafter until the divestitures are

completed, and annually for a period of

ten years.

The purpose of this analysis is to

invite public comment on the proposed

consent order to aid the Commission in

its determination of whether it should

make final the proposed consent order

contained in the agreement.

This analysis is not intended to

constitute an official interpretation of

the agreement and proposed consent

order, nor is it intended to modify the

terms of the agreement and proposed

consent order in any way.

Donald S. Clark,

Secretary.

Concurring Statement of Commissioner

Mary L. Azcuenaga

Re: Schnuck Markets, Inc., File No. 941–

0131; Schwegmann Giant Super

Markets, Inc., File No. 941–0130

The two complaints allege geographic

markets comprising ‘‘the St. Louis MSA,

and narrower markets contained

therein’’ and ‘‘metro New Orleans,

Louisiana area, which consists of the

parishes of Orleans, Jefferson, and St.

Bernard, and marrower markets

contained therein.’’ Although I question

the broad geographic markets alleged,

the investigational record contains

sufficient information to support a

finding of reason to believe with respect

to small, discrete geographic markets

located within the broad regions alleged

in the complaint, and the stores to be

divested were selected with a view to

remedying competitive concerns in the

small, discrete markets.

In addition, the complaints allege as

the product market ‘‘the retail sale of

food and grocery products in

supermarkets, and narrower markets

contained therein.’’ A serious argument

can be made that the market should

include sales of food and groceries in

certain stores other than traditional

supermarkets. Since the investigational

record suggests that the concentration is

high even if additional sales are

included in the market, the issue need

not be resolved at this time.

Accordingly, I concur in the decision to

accept the consent agreements for

publication.

[FR Doc. 95–6343 Filed 3–14–95; 8:45 am]

BILLING CODE 6750–01–M

GENERAL SERVICES

ADMINISTRATION

Construction of FDA Regional Office

and Laboratory; Environmental Impact

Statement; Jamaica, Queens County,

New York

AGENCY: General Services

Administration (GSA).

ACTION: Notice of Intent to hold a public

scoping meeting and prepare and file an

Environmental Impact Statement (EIS).

SUMMARY: The GSA is issuing this notice

to advise the public that an EIS will be

prepared for the construction of the

FDA Regional Office and Laboratory in

Jamaica, Queens County, New York.

FOR FURTHER INFORMATION CONTACT: Mr.

Peter A. Sneed, Asset Manager, U.S.

General Services Administration, Public

Buildings Service, 26 Federal Plaza,

Room 1609, New York City, NY 10278,

(212) 264–3581.

SUPPLEMENTARY INFORMATION: The GSA

will serve as lead agency and project

sponsor in the preparation and filing of

an EIS for the construction of the FDA

Regional Office and Laboratory in

Jamaica, Queens County, New York. The

proposed action would involve the

construction and operation of the

facility on an assemblage of two

properties located at the intersection

158th Street and Liberty Avenue.

Combined, these two properties are 4.25

acres (1.73 hectares) in size. The

existing FDA regional facilities are

located in Federal Building #2 of the

Federal Complex in Sunset Park,

Brooklyn, New York. Due to the

deteriorated condition of, and space

constraints in, the present facility, FDA

has requested relocation to a modern

expanded facility to accommodate the

additional staffing required to provide

increased oversight and product

monitoring. This action is intended to

provide 175,000 occupiable square feet

(16,250 square meters) of office, storage,

and special space.

The EIS will evaluate the FDA

regional facility alternatives, including

the No-Action Alternative. It will also

evaluate impacts on the affected

environment, including, but not limited

to, socioeconomics, hazardous

materials, traffic/transportation, land

use, cultural resources, and noise.