61498 Federal Register / Vol. 73, No. 201 / Thursday, October 16, 2008 / Notices 

DEPARTMENT OF JUSTICE 

Antitrust Division 

United States v. The Manitowoc 

Company, Inc., et al.; Proposed Final 

Judgment and Competitive Impact 

Statement 

Notice is hereby given pursuant to the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. § 16(b)–(h), that a proposed 

Final Judgment, Stipulation and 

Competitive Impact Statement have 

been filed with the United States 

District Court for the District of 

Columbia in United States v. The 

Manitowoc Company, Inc., et al., Civil 

Action No. 1:08–cv–01704. On October 

6, 2008, the United States filed a 

Complaint alleging that the proposed 

acquisition by The Manitowoc 

Company, Inc. (‘‘Manitowoc’’) of Enodis 

plc would violate Section 7 of the 

Clayton Act, 15 U.S.C. § 18, by 

substantially lessening competition in 

the United States in the manufacture, 

development, distribution, and sale of 

commercial cube ice machines. The 

proposed Final Judgment, filed the same 

day as the Complaint, requires 

Manitowoc to divest Enodis’s entire 

business engaged in the development, 

production, distribution, and sale of ice 

machines, ice machine parts, and 

related equipment in the United States. 

Copies of the Complaint, proposed 

Final Judgment, Stipulation, and 

Competitive Impact Statement are 

available for inspection at the 

Department of Justice, Antitrust 

Division, Antitrust Documents Group, 

450 Fifth Street, NW, Suite 1010, 

Washington, DC 20530 (telephone: 202 

514–2481), on the Department of 

Justice’s Web site at http:// 

www.usdoj.gov/atr, and at the Office of 

the Clerk of the United States District 

Court for the District of Columbia. 

Copies of these materials may be 

obtained from the Antitrust Division 

upon request and payment of the 

copying fee set by Department of Justice 

regulations. 

Public comment is invited within 60 

days of the date of this notice. Such 

comments, and responses thereto, will 

be published in the Federal Register 

and filed with the Court. Comments 

should be directed to Maribeth Petrizzi, 

Chief, Litigation II Section, Antitrust 

Division, Department of Justice, 

Washington, DC 20530, (telephone: 

202–307–0924). 

J. Robert Kramer, II 

Director of Operations. 

United States District Court for the District 

of Columbia 

United States of America, Department of 

Justice, Antitrust Division, 1401 H Street, 

NW., Suite 3000, Washington, D.C. 20530, 

Plaintiff, v. The Manitowoc Company, Inc., 

2400 South 44th Street, Manitowoc, 

Wisconsin 54221; ENODIS PLC, 175 High 

Holborn, London, England WCIV 7AA; and 

Enodis Corporation, 2227 Welbilt Boulevard, 

New Port Richey, Florida, 34655, Defendants 

Case No.: Deck Type: Antitrust Case: 1:08-cv01704, Assigned to: Kennedy, Henry H., 

Assign. Date: 10/6/2008, Description: 

Antitrust 

Complaint 

The United States of America 

(‘‘United States’’), acting under the 

direction of the Attorney General of the 

United States, brings this civil antitrust 

action against defendants The 

Manitowoc Company, Inc. 

(‘‘Manitowoc’’), Enodis plc, and Enodis 

Corporation (Enodis plc and Enodis 

Corporation will hereinafter be 

collectively referred to as ‘‘Enodis’’) to 

enjoin Manitowoc’s proposed 

acquisition of Enodis plc and to obtain 

other relief. The United States 

complains and alleges as follows: 

I. Nature of the Action 

1. On June 30, 2008, Manitowoc 

offered to acquire Enodis plc for 328 

pence in cash per share, in a transaction 

valued at 27 billion (including assumed 

debt). The acquisition is structured as a 

Scheme of Arrangement under the laws 

of the United Kingdom. The directors of 

Enodis plc unanimously recommended 

that its shareholders vote in favor of 

accepting Manitowoc’s offer, and a 

majority of the shareholders did so. 

2. Manitowoc manufactures and sells 

commercial ice machines in the United 

States under the Manitowoc brand, and 

its ice machines are the most widely 

sold in the United States. Enodis 

manufactures and sells commercial ice 

machines under two brands in the 

United States, Scotsman and Ice-OMatic (collectively, the ‘‘Enodis 

brands’’); Scotsman and Ice-O-Matic 

machines are the second and fourth 

most widely sold, respectively. 

3. In the United States, Manitowoc’s 

proposed acquisition of Enodis would 

reduce the number of manufacturers 

that sell commercial ice machines 

producing cubed ice from three to two 

and would create a company with 

approximately 70 percent of the U.S. 

sales of commercial cube ice machines. 

Unless the proposed acquisition is 

enjoined, competition for commercial 

cube ice machines will be substantially 

reduced. The proposed acquisition 

likely would result in higher prices, 

lower quality, and less innovation in the 

commercial cube ice machine market. 

4. The United States brings this action 

to prevent the proposed acquisition of 

Enodis by Manitowoc because that 

acquisition would substantially lessen 

competition in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States in violation of Section 7 

of the Clayton Act, 15 U.S.C. § 18. 

II. Parties to the Proposed Transaction 

5. Defendant Manitowoc is a 

Wisconsin corporation with its 

principal place of business in 

Manitowoc, Wisconsin. It is a global 

industrial equipment company that 

manufacturers commercial ice machines 

and related equipment, refrigeration 

equipment, cranes, and ships and other 

water vessels. 

6. In 2007, Manitowoc reported total 

sales of approximately $4 billion. 

Manitowoc’s sales of commercial ice 

machines and related equipment in the 

United States were approximately $152 

million in 2007. Sales of commercial ice 

machines making cube ice accounted for 

over 70 percent of this total. 

7. Enodis is a corporation registered 

in the United Kingdom and Wales with 

its principal place of business in 

London, England. Enodis Corporation, a 

wholly owned subsidiary of Enodis plc, 

is a Delaware corporation with its 

headquarters in New Port Richey, 

Florida. Through its global food service 

equipment group, Enodis designs, 

manufactures, and sells cooking, food 

storage and preparation equipment, and 

ice machines and related equipment. 

8. Enodis plc’s revenues for its 2007 

fiscal year were $1.6 billion. North 

American sales accounted for 

approximately 70 percent of Enodis 

plc’s total revenue. In its fiscal year 

2007, Enodis plc’s sales of commercial 

ice machines and related equipment in 

the United States were approximately 

$153 million. Sales of commercial ice 

machines making cube ice accounted for 

about 60 percent of this total. 

III. Jurisdiction and Venue 

9. The United States brings this action 

under Section 15 of the Clayton Act, as 

amended, 15 U.S.C. § 25, to prevent and 

restrain Defendants from violating 

Section 7 of the Clayton Act, 15 U.S.C. 

§ 18. 

10. Defendants develop, produce, 

distribute, and sell commercial ice 

machines and other products in the flow 

of interstate commerce. Defendants’ 

activities in the development, 

production, distribution, and sale of 

these products substantially affect 

interstate commerce. This Court has 


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subject matter jurisdiction over this 

action pursuant to Section 12 of the 

Clayton Act, 15 U.S.C. § 22, and 28 

U.S.C. § 1331, 1337(a), and 1345. 

11. Defendants sell commercial ice 

machines and other products, and have 

consented to venue and personal 

jurisdiction, in this judicial district. 

Venue is proper under 15 U.S.C. § 22 

and 28 U.S.C. § 1391(c). 

IV. Trade and Commerce 

A. The Relevant Product Market 

12. Restaurants, convenience stores, 

hotels, and other businesses need 

significant volumes of ice. These 

businesses usually meet their needs by 

using commercial ice-making machines 

located at their places of business. 

These machines make ice by a 

continuous cycle of condensation and 

expansion of a refrigerant through a 

network of tubing. As the refrigerant 

converts from a compressed liquid state 

to become a gas, heat is drawn from a 

component called an evaporator. Water 

running over the evaporator surface 

freezes to form ice that is then harvested 

by processes specific to the type of ice 

produced by the machine. 

13. The type of ice machine 

purchased by a customer depends on 

the type and volume of ice needed. 

Commercial ice machines are designed 

to produce either hard ice or soft ice. 

Hard ice melts slowly and has a higher 

density and less surface area than soft 

ice. Hard ice is most often shaped as 

cubes or dice, half-cubes or half-dice, 

octagons, or crescent cubes, and is 

commonly referred to as cube ice. Most 

customers that serve ice in beverages 

prefer cube ice because it melts slowly 

and thus minimizes deterioration in the 

flavor of the beverage. Soft ice refers to 

small nuggets or flakes of ice that have 

a lower density and more surface area 

than cube ice and, therefore, melt more 

quickly than cube ice. Soft ice is used 

in hospitals, which demand a safe, 

chewable ice for their patients, by 

grocery stores or other establishments to 

display seafood produce, and other 

perishable food, and for industrial 

cooling applications. The prices of 

commercial ice machines producing soft 

ice are often 15 to 20 percent higher 

than prices of ice machines that produce 

comparable quantities of cube ice per 

day. 

14. In response to a small but 

significant post-acquisition increase in 

the price of commercial machines 

producing cube ice, customers would 

not switch to machines that make soft 

ice in sufficient numbers so as to make 

such a price increase unprofitable. 

15. Customers vary greatly with 

respect to their daily needs of cubed ice, 

and they require machines having an 

appropriate range of capacity to meet 

those needs. A significant and distinct 

segment of cube ice machine customers, 

including sit-down and fast-food 

restaurants, bars, and convenience 

stores, purchase commercial machines 

capable of producing between 

approximately 300 pounds to 2,000 

pounds of cube ice per day (hereinafter, 

‘‘commercial cube ice machines’’). 

16. Although customers can purchase 

units that produce between 

approximately 50 and 300 pounds of ice 

per day, these machines are not able to 

meet the needs of the large majority of 

commercial cube ice machine 

customers. Few customers are likely to 

meet their needs by purchasing two or 

more smaller machines because it 

would be cost-prohibitive to do so. 

Similarly, large units that produce over 

2,000 pounds of ice per day are not 

substitutes for commercial cube ice 

machines and are used by customers 

that need extremely large volumes of 

ice, such as convention centers, sports 

arenas, or bagged-ice producers. 

Because of the attributes of commercial 

cube ice machines, a small but 

significant post-acquisition increase in 

the prices of commercial cube ice 

machines would not cause customers to 

switch to other ice machines in 

sufficient numbers so as to make such 

a price increase unprofitable. 

17. Accordingly, the development, 

production, distribution, and sale of 

commercial cube ice machines is a line 

of commerce and a relevant product 

market within the meaning of Section 7 

of the Clayton Act. 

B. The Relevant Geographic Market 

18. Commercial ice machines are 

complex and break down more 

frequently than other types of food 

service equipment, and customers often 

need quick access to replacement 

machines, parts, and service. Sales of 

commercial cube ice machines in the 

United States by manufacturers are 

primarily made to distributors that 

supply equipment dealers and repair 

companies who sell to end-users. In 

addition, these distributors typically 

train service representatives regarding 

repair and maintenance of the 

commercial ice machines, as well as 

manage warranty claims. In order to be 

a competitive supplier of commercial 

cube ice machines within the United 

States, manufacturers must have an 

established network of local 

distribution, service, and support. 

19. A small but significant increase in 

the prices of commercial cube-ice 

machines would not cause a sufficient 

number of customers in the United 

States to turn to manufacturers of 

commercial cube ice machines that do 

not have an established a network of 

local distribution, service, and support 

in the United States. As a result, such 

manufacturers would not be able to 

constrain such an increase. 

20. Accordingly, the United States is 

a relevant geographic market within the 

meaning of Section 7 of the Clayton Act. 

C. Competitive Effects 

1. Concentration 

21. The market for commercial cube 

ice machines is highly concentrated. 

Manitowoc and Enodis are the two 

largest manufacturers of commercial 

cube ice machines in the United States. 

Only one other company has 

demonstrated the ability to produce 

commercial cube ice machines of the 

same quality and with similar features 

as the Manitowoc and Enodis machines 

and has an established a network of 

local distribution, service, and support 

in the United States. 

22. Manitowoc accounts for 

approximately 40 percent of the sales of 

commercial cube ice machines in the 

United States. Enodis accounts for 

approximately 30 percent of the sales of 

commercial cube ice machines in the 

United States. 

23. The market for commercial cube 

ice machines would become 

substantially more concentrated if 

Manitowoc were to acquire Enodis. 

Combined, Manitowoc and Enodis 

would account for approximately 70 

percent of the sales of commercial cube 

ice machines in the United States. Using 

a measure of market concentration 

called the Herfindahl-Hirschman Index 

(‘‘HHP’), which is explained in 

Appendix A, the proposed transaction 

would increase the HHI in the market 

for commercial cube ice machines by 

approximately 2,400 points to a postacquisition level of approximately 

5,800. This is well in excess of levels 

that raise significant antitrust concerns. 

2. The Proposed Transaction Would 

Harm Competition in the Market for 

Commercial Cube Ice Machines. 

24. The vigorous and aggressive 

competition between Manitowoc and 

Enodis in the development, production, 

distribution, and sale of commercial 

cube ice machines has benefitted 

customers. Manitowoc and Enodis 

compete directly on price, quality, and 

innovation. Although commercial cube 

ice machine offerings are differentiated, 

many commercial cube ice machine 

customers view the Manitowoc and 


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Scotsman brands as close substitutes for 

one another. 

25. The proposed acquisition would 

eliminate the competition between 

Manitowoc and Enodis and reduce the 

number of significant manufacturers of 

commercial cube ice machines in the 

United States from three to two. Postmerger, Manitowoc would profit by 

unilaterally raising the price (or 

reducing quality and innovation) of one 

or more of the brands it would own. 

Although Manitowoc could lose some 

sales in that brand or brands as a result 

of such a price increase (or decline in 

quality and innovation), many sales 

would be diverted to one of the other 

brands under its ownership. Capturing 

such diverted sales would make a postmerger price increase (or reduction in 

quality and innovation) profitable, when 

it would not have been profitable before 

the merger. 

26. The response of other commercial 

cube ice machines manufacturers in the 

United States would not be sufficient to 

constrain a unilateral exercise of market 

power by Manitowoc after the 

acquisition because, they do not have 

the incentive or the ability, individually 

or collectively, to do so. 

27. Therefore, the proposed 

acquisition would enable Manitowoc to 

exercise market power unilaterally, 

lessen competition in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States, and lead to higher prices, 

lower quality, and less innovation for 

the ultimate consumers of commercial 

cube ice machines, in violation of 

Section 7 of the Clayton Act. 

V. Entry 

28. Successful entry or expansion into 

the development, production, 

distribution, and sale of commercial 

cube ice machines would be difficult, 

time-consuming, and costly. Firms 

attempting to enter or expand into the 

commercial cube ice machine market 

face a combination of distribution, 

reputation, and technology-related 

barriers to entry. 

29. Customers need quick access to 

replacement ice machines and parts, 

and, as a result, the three significant 

commercial cube ice machine 

competitors each have a nationwide 

network of local distributors. These 

distributors maintain sizeable 

inventories at locations across the 

United States so as to meet individual 

customer demands. 

30. Developing a nationwide 

distribution network would be difficult 

and time consuming. Finding good 

distributors would be difficult because 

each of the current three commercial 

cube ice machine competitors has 

contracted exclusively with a large 

majority of the sizeable and reputable 

distributors across the United States, 

and an existing or potential distributor 

likely would not agree to distribute a 

commercial ice machine unless it could 

be assured of a sufficient volume of 

sales of machines and parts to make a 

profit on the inventory and other 

investments it must make. Further, 

distributors must build relationships 

with the food service equipment 

dealers, air-conditioning and 

refrigeration repair companies, and 

others that sell commercial ice 

machines to end-users. Building such 

relationships would take a significant 

amount of time and effort. 

31. Reputation or brand recognition is 

another barrier to entry. Because 

commercial cube ice machines are so 

important to customers’ operations, 

customers are reluctant to purchase 

machines from a company that has not 

established a reputation for making 

high-quality, durable machines. 

Establishing a track record of reliable 

performance takes years. 

32. The technology involved in 

developing and manufacturing a 

commercial cube ice machine is a third 

significant entry barrier. The three 

current competitors produce—and 

customers expect and demand— 

commercial cube ice machines that last 

seven to ten years, that consistently 

produce ice that is clear and pure under 

conditions of varying water chemistries 

and air and water temperatures, and that 

meet federal and state energy 

regulations. Designing and 

manufacturing commercial cube ice 

machines that have these characteristics 

and are comparable in quality to the 

machines of the three current 

competitors would take years, even for 

firms that already produce other types 

of ice machines. 

33. Therefore, entry or expansion by 

any other firm into the commercial cube 

ice machine market would not be 

timely, likely, or sufficient to defeat an 

anticompetitive price increase in the 

event that Manitowoc acquires Enodis. 

VI. Violations Alleged 

34. The proposed acquisition of 

Enodis by Manitowoc would 

substantially lessen competition and 

tend to create a monopoly in interstate 

trade and commerce in violation of 

Section 7 of the Clayton Act, 15 U.S.C. 

§ 18. 

35. Unless restrained, the transaction 

will have the following anticompetitive 

effects, among others: 

a. Actual and potential competition 

between Manitowoc and Enodis in the 

development, production, distribution, 

and sale of commercial cube ice 

machines in the United States will be 

eliminated; 

b. Competition generally in the 

development, production, distribution, 

and sale of commercial cube ice 

machines in the United States will be 

substantially lessened; and 

c. Prices for commercial cube ice 

machines in the United States likely 

will increase, the quality of commercial 

cube ice machines in the United States 

likely will decline, and innovation 

relating to commercial cube ice 

machines in the United States likely 

will decline. 

VII. Request for Relief 

36. Plaintiff requests that: 

a. Manitowoc’s proposed acquisition 

of Enodis be adjudged and decreed to be 

unlawful and in violation of Section 7 

of the Clayton Act, 15 U.S.C. § 18; 

b. Defendants and all persons acting 

on their behalf be permanently enjoined 

and restrained from consummating the 

proposed acquisition or from entering 

into or carrying out any contract, 

agreement, plan, or understanding, the 

effect of which would be to combine 

Manitowoc with the operations of 

Enodis; 

c. Plaintiff be awarded its costs for 

this action; and 

d. Plaintiff receive such other and 

further relief as the Court deems just 

and proper. 

Respectfully submitted, 

For Plaintiff United States of America: 

Thomas O. Barnett, 

Assistant Attorney General, D.C. Bar 

#426840. 

David L. Meyer, 

Deputy Assistant Attorney General, D.C. Bar 

#414420. 

J. Robert Kramer II, 

Director of Operations. 

Maribeth Petrizzi, 

Chief, Litigation II Section, D.C. Bar #435204. 

Dorothy B. Fountain, 

Assistant Chief, Litigation II Section, D.C. Bar 

#439469. 

Helena M. Gardner, 

Christine A. Hill (D.C. Bar #461048) 

Attorneys, United States Department of 

Justice, Antitrust Division, Litigation II 

Section, 1401 H Street, NW, Suite 3000, 

Washington, D.C. 20530, (202) 514–8518. 

Dated: October 6, 2008. 

Appendix A—Herfindahl-Hirschman 

Index Calculations 

’’HHI’’ means the HerfindahlHirschman Index, a commonly accepted 

measure of market concentration. It is 

calculated by squaring the market share 

of each firm competing in the market 

and then summing the resulting 


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numbers. For example, for a market 

consisting of four firms with shares of 

thirty, thirty, twenty, and twenty 

percent, the HHI is 2600 (302 + 302 + 

202 + 202 = 2,600). The HHI takes into 

account the relative size and 

distribution of the firms in a market and 

approaches zero when a market consists 

of a large number of firms of relatively 

equal size. The HHI increases both as 

the number of firms in the market 

decreases and as the disparity in size 

between those firms increases. 

Markets in which the HHI is between 

1,000 and 1,800 points are considered to 

be moderately concentrated and those in 

which the HHI is in excess of 1,800 

points are considered to be highly 

concentrated. Transactions that increase 

the HHI by more than 100 points in 

highly concentrated markets 

presumptively raise antitrust concerns 

under the Horizontal Merger Guidelines 

issued by the U.S. Department of Justice 

and the Federal Trade Commission. See 

Horizontal Merger Guidelines § 1.51. 

United States District Court for the 

District of Columbia 

United States of America, Plaintiff, v. 

the Manitowoc Company, Inc., Enodis 

Plc, and Enodis Corporation, 

Defendants 

Civil Action No.: 

Description: Antitrust 

Judge: 

Date Stamp: 

Proposed Final Judgment 

Whereas, Plaintiff, the United States 

of America, filed its Complaint on 

October 6, 2008, the United States and 

defendants, The Manitowoc Company, 

Inc., Enodis plc, and Enodis 

Corporation, 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 party regarding any 

issue of law or fact; 

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 and assets 

by the defendants to assure that 

competition is not substantially 

lessened; 

And whereas, the United States 

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 hereby 

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 

claim upon which relief may be granted 

against the defendants under Section 7 

of the Clayton Act, as amended (15 

U.S.C. 18). 

II. Definitions 

As used in this Final Judgment: 

A. ‘‘Acquirer’’ means the entity to 

whom defendants divest the Divestiture 

Business. 

B. ‘‘Enodis’’ means defendant Enodis 

plc, a corporation registered in England 

and Wales with its headquarters in 

London, England, and Enodis 

Corporation, a Delaware corporation 

with its headquarters in New Port 

Richey, Florida, and their successors, 

assigns, parents, subsidiaries, divisions, 

groups, affiliates, partnerships, and joint 

ventures, and all of their directors, 

officers, managers, agents, and 

employees. 

C. ‘‘Manitowoc’’ means defendant The 

Manitowoc Company, Inc., a Wisconsin 

corporation headquartered in 

Manitowoc, Wisconsin, its successors, 

assigns, parents, subsidiaries, divisions, 

groups, affiliates, partnerships, and joint 

ventures, and all of their directors, 

officers, managers, agents, and 

employees. 

D. ‘‘Closing Date’’ means the date on 

which the transfer of the Divestiture 

Assets from the defendants to the 

Acquirer has been completed 

E. ‘‘Divestiture Business’’ means 

Enodis’s entire business engaged in the 

development, production, distribution, 

and sale of ice machines, ice machine 

parts, and related equipment (such as 

ice bins, ice dispensers, and water 

filtration systems) in the United States, 

including, but not limited to: 

(1) Enodis’s facility located in Fairfax, 

South Carolina, which is owned by 

Scotsman Group, Inc. (now known as 

Scotsman Group L.L.C.); 

(2) Enodis’s facility located in Vernon 

Hills, Illinois, which is leased by 

Scotsman Group, Inc. (now known as 

Scotsman Group L.L.C.); 

(3) Enodis’s facility located in Denver, 

Colorado, which is owned by Welbilt 

Corporation (now known as Enodis 

Corporation); 

(4) Enodis’s facility located in 

Pomona, California, which is leased by 

Scotsman Group, Inc. (now known as 

Scotsman Group L.L.C.); 

(5) All tangible assets used in the 

Divestiture Business, including, but not 

limited to, all research and development 

activities; all manufacturing equipment, 

tooling and fixed assets, personal 

property, inventory, office furniture, 

materials, supplies, and other tangible 

property (including replacement 

hardware for the Vernon Hills, Illinois 

facility that defendants are required to 

purchase pursuant to Section II, 

Paragraph E below); all licenses, permits 

and authorizations issued by any 

governmental organization relating to 

the Divestiture Business; all contracts, 

teaming alTangements, agreements, 

leases, commitments, certifications, and 

understandings relating to the 

Divestiture Business, including, but not 

limited to, supply and distribution 

agreements; all customer lists, accounts, 

and credit records; all repair and 

performance records and all other 

records; and 

(6) All intangible assets used in the 

development, production, distribution, 

and sale of ice machines, ice machine 

parts, and related equipment, including, 

but not limited to, all contractual rights 

(to the extent assignable), except for 

contracts that are not primarily for 

products or services used by the 

Divestiture Business; all rights under 

licenses, permits and authorizations 

issued by any governmental 

organization relating to the Divestiture 

Business; patents, licenses and 

sublicenses, intellectual property, 

copyrights, trademarks, trade names 

(including any use of the name 

Scotsman or Ice-O-Matic in the United 

States), service marks, service names, 

technical information, computer 

software and related documentation 

(including replacement software and 

related documentation that defendants 

are required to purchase, and 

applications and data that defendants 

are required to transfer to hardware, for 

the Vernon Hills, Illinois facility 

pursuant to Section II, Paragraph E 

below), know-how, trade secrets, 

drawings, blueprints, designs, design 

protocols, specifications for materials, 

specifications for parts and devices, 

safety procedures for the handling of 

materials and substances, quality 

assurance and control procedures, 

design tools and simulation capability, 

all manuals and technical information 

defendants provide to their own 


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employees, customers, suppliers, agents 

or licensees; and all research data 

concerning historic and current research 

and development efforts (up to the 

Closing Date of the divestiture required 

by section IV or section V), including, 

but not limited to, designs of 

experiments, and the results of 

successful and unsuccessful designs and 

experiments; except that the Divestiture 

Business shall not include the servers, 

applications, and related documentation 

located at the Vernon Hills, Illinois 

facility that are not used primarily in 

the operation of the Divestiture 

Business, provided that within 45 days 

after the filing of the Complaint in this 

matter, defendants take all steps 

necessary (including the purchase of 

replacement hardware, the purchase, 

licensing, or provision of software and 

related documentation, and the transfer 

of applications and data) to ensure that 

all information technology operations 

used by the Divestiture Business are 

maintained at levels of functionality 

equivalent or superior to the levels of 

functionality that exist as of the filing of 

the Complaint in this matter. 

Defendants shall also take all steps 

necessary to purge any data related to 

the Divestiture Business from hardware 

and backup media at Vernon Hills that 

will not be divested under this 

provision. The Divestiture Business 

shall not include the tangible or 

intangible assets comprising the Enodis 

facility in New Port Richey, Florida, 

with the exception of the following: (1) 

Any software, electronically stored 

information, or documents arising from 

research and development activities 

related to the ice machine business; (2) 

any assets used primarily in the 

operation of the ice machine business, 

or (3) any assets necessary for operation 

of the ice machine business. 

F. ‘‘Frimont Business’’ means Enodis 

plc’s Frimont S.p.A. business, which 

produces commercial ice machines for 

the European market and which the 

European Commission has required to 

be divested. 

III. Applicability 

A. This Final Judgment applies to 

Manitowoc and Enodis, as defined 

above, and all other persons in active 

concert or participation with any of 

them who receive actual notice of this 

Final Judgment by personal service or 

otherwise. 

B. If, prior to complying with section 

IV and V of this Final Judgment, 

defendants sell or otherwise dispose of 

all or substantially all of their assets or 

of lesser business units that include the 

Divestiture Business, they shall require 

the purchaser to be bound by the 

provisions of this Final Judgment. 

Defendants need not obtain such an 

agreement from the Acquirer of the 

assets divested pursuant to this Final 

Judgment. 

IV. Divestitures 

A. Defendants are ordered and 

directed, within 150 calendar days after 

the filing of the Complaint in this 

matter, or five (5) calendar days after 

notice of the entry of this Final 

Judgment by the Court, whichever is 

later, to divest the Divestiture Business 

in a manner consistent with this Final 

Judgment to a single Acquirer 

acceptable to the United States, in its 

sole discretion after consultation with 

the European Commission. The United 

States, in its sole discretion, may agree 

to one or more extensions of this tune 

period 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 Business 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 Business. 

Defendants shall inform any person 

making inquiry regarding a possible 

purchase of the Divestiture Business 

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 

Business customarily provided in a due 

diligence process except such 

information or documents subject to the 

attorney-client privilege or workproduct doctrine. 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 all personnel 

involved in development, production, 

distribution, and sales related to the 

Divestiture Business to enable the 

Acquirer to make offers of employment 

Defendants will not interfere with any 

negotiations by the Acquirer to employ 

any employee whose primary 

responsibility is development, 

production, distribution, and sales 

related to the Divestiture Business, and 

will not interfere with negotiations by 

the Acquirer to employ the following 

three Enodis employees who work at the 

Vernon Hills, Illinois facility: (1) The 

Senior Business Analyst and Developer; 

(2) the Unix Administrator and Network 

Manager; and (3) the Computer Operator 

and Systems Specialist. 

D. Defendants shall permit 

prospective Acquirers of the Divestiture 

Business to have reasonable access to 

personnel and to make inspections of 

the physical facilities of the Divestiture 

Business; 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 that each asset 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 Business. Defendants 

shall not exercise any contractual right 

to prevent, or otherwise attempt in any 

way to impede, sales or service 

representatives that represent Enodis in 

connection with the Divestiture 

Business from representing the Acquirer 

in the sale or servicing of products sold 

by the Divestiture Business. 

G. Enodis shall warrant to the 

Acquirer that there are no material 

defects, and Manitowoc shall warrant 

that it is not aware of any material 

defects, in the environmental, zoning or 

other permits pertaining to the 

operation of each asset, and that 

following the sale of the Divestiture 

Business, defendants will not 

undertake, directly or indirectly, any 

challenges to the environmental, zoning, 

or other permits relating to the 

operation of the Divestiture Business 

H. Notwithstanding anything to the 

contrary in this Final Judgment, at the 

option of the Acquirer, defendants shall 

enter into a transition services 

agreement for a limited period, with 

respect to information technology and 

other support services that are 

reasonably necessary to operate the 

Divestiture Business, with the scope, 

terms and conditions of such agreement 

being subject to the approval of the 

United States in its sole discretion. 

I. At the option of the Acquirer, 

defendants shall use their best efforts to 

procure the assignment of contractual 

rights referenced in section II, Paragraph 

E(6) before the Closing Date of the 

divestiture required by section IV or 

section V. 

J. Defendants shall not interfere with 

any effort by the Acquirer to negotiate 

a contract with any supplier of any 

product purchased by the Divestiture 

Business as of the filing of the 


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Complaint in this matter. If requested by 

the Acquirer: 

(1) Defendants shall provide 

information or documentation relating 

to controllers, compressors, condensers, 

valves, and copper strips, or any other 

product customized for the Divestiture 

Business by any supplier, that are 

purchased by the Divestiture Business 

under contracts as to which the 

defendants are unable to secure effective 

assignment to the Acquirer or under 

contracts that are not primarily for 

products or services used by the 

Divestiture Business; and 

(2) If the Acquirer is unable, prior to 

the Closing Date of the divestiture 

required by section IV or section V, to 

negotiate and enter into a contract, on 

commercially reasonable terms with a 

qualified and reliable supplier, 

providing for the Acquirer’s supply of 

copper strips, or any other product for 

which an alternative supplier is not 

available as of the Closing Date, that 

have the same characteristics (or, so 

long as the product allows continuation 

of the Divestiture Business without 

disruption, having substantially the 

same characteristics) and are of the 

same, or superior, quality as those 

purchased by the Divestiture Business 

as of the filing of the Complaint in this 

matter, defendants shall purchase any 

such product on behalf of the Acquirer 

and resell it to the Acquirer at the price 

specified in defendants’ supply contract 

as of the date of the purchase of the 

product for the Divestiture Business. 

This obligation shall expire upon the 

earlier of (1) the Acquirer or Divestiture 

Business having negotiated a contract of 

purchase of any such product meeting 

the criteria set forth above, (2) the 

Acquirer notifying defendants in writing 

that the Divestiture Business no longer 

intends to purchase any such product 

under this provision, (3) the expiration 

of the supply contract in accordance 

with the terms of that contract as they 

existed as of the date of the filing of the 

Complaint in this matter, or (4) one year 

after the date of the divestiture required 

under section IV or section V 

Defendants shall not discuss, provide, 

disclose, or otherwise make available, 

directly or indirectly, any information 

related to such purchases and resales to 

any defendant personnel involved in 

production, marketing, distribution, or 

sales of ice machines. 

K. 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 Business, and shall be 

accomplished in such a way as to satisfy 

the United States, in its sole discretion, 

that the Divestiture Business can and 

will be used by the Acquirer as part of 

a viable, ongoing business engaged in 

the development, production, 

distribution, and sale of commercial 

cube ice machines, ice machine parts, 

and related equipment in the United 

States. The divestitures, whether 

pursuant to section IV or section V of 

this Final Judgment, (1) shall be made 

to the acquirer of the Frimont Business; 

(2) shall be made to an Acquirer that, in 

the United States’s sole judgment, has 

the intent and capability (including the 

necessary managerial, operational, 

technical and financial capability) of 

competing effectively in the 

development, production, distribution, 

and sale of commercial cube ice 

machines, ice machine parts, and 

related equipment in the United States; 

and 

(3) Shall be accomplished so as to 

satisfy the United States, in its sole 

discretion, that none of the terms of any 

agreement between the 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 in 

the development, production, 

distribution, and sale of commercial 

cube ice machines, ice machine parts, 

and related equipment in the United 

States. 

V. Appointment of Trustee 

A. If defendants have not divested the 

Divestiture Business within the time 

period specified in section IV, 

Paragraph 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, in 

consultation with the European 

Commission to enable selection of a 

trustee acceptable to both the United 

States and the European Commission, 

and approved by the Court to effect the 

divestiture of the Divestiture Business. 

B. After the appointment of a trustee 

becomes effective, only the trustee shall 

have the right to sell the Divestiture 

Business. 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, 

Paragraph 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 or that the 

Acquirer has not been approved by the 

European Commission. Any objection 

by defendants on the ground of the 

trustee’s malfeasance 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; any objection 

by defendants based on lack of approval 

from the European Commission must be 

conveyed in writing to the United States 

and the trustee within two (2) business 

days after the European Commission 

notifies defendants that it does not 

approve of the proposed Acquirer. 

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 Business and based on a fee 

arrangement providing the trustee with 

an incentive based on the price and 

terms of the divestiture and the speed 

with which it is accomplished, 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 

of 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, 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 


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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 

Business, 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 

Business. 

G. If the trustee has not accomplished 

the divestiture ordered under this Final 

Judgment 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 reports shall not be 

filed in the public docket of the Court. 

The trustee shall at the same time 

furnish such report to the United States 

which 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 the 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 Business, 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, 

Paragraph 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 section V shall not 

be consummated. Upon objection by 

defendants under section V, Paragraph 

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 section IV or V of this Final 

Judgment. 

VIII. Hold Separate 

Until the divestiture required by this 

Final Judgment has been accomplished, 

defendants shall take all steps necessary 

to comply with the Hold Separate 

Stipulation and Order entered by this 

Court. Defendants shall take no action 

that would jeopardize the divestiture 

ordered by this Court. 

IX. Affidavits 

A. Within twenty (20) calendar days 

of the filing of the Complaint in this 

matter, and every thirty (30) calendar 

days thereafter until the divestiture has 

been completed under section IV or V, 

defendants shall deliver to the United 

States an affidavit as to the fact and 

manner of its 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) calendar 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 Business, and shall 

describe in detail each contact with any 

such person during that period. Each 

such affidavit shall also include a 

description of the efforts defendants 

have taken to solicit buyers for the 

Divestiture Business, and to provide 

required information to prospective 

Acquirers, 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 limitation on 

information, shall be made within 

fourteen (14) calendar days of receipt of 

such affidavit. 

B. Within twenty (20) calendar days 

of the filing of the Complaint in this 

matter, 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 

VIII 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 Business until one year 

after such divestiture has been 

completed. 

X. 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 

authorized representatives of the United 

States Department of Justice Antitrust 

Division (‘‘DOJ’’), including consultants 

and other persons retained by the 

United States, shall, upon written 

request of an 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 the 

option of the United States, to require 

defendants to provide hard copy or 

electronic copies of, all books, ledgers, 

accounts, records, data, and documents 

in the possession, custody, or control of 

defendants, 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, 


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regarding such matters. The interviews 

shall be subject to the reasonable 

convenience of the interviewee and 

without restraint or interference by 

defendants. 

B. Upon the written request of an 

authorized representative of the 

Assistant Attorney General in charge of 

the Antitrust Division, defendants shall 

submit written reports or responses to 

written interrogatories, 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)(1)(G) 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)(1)(G) 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). 

XI. No Reaction 

Defendants may not reacquire any 

part of the Divestiture Business during 

the term of this Final Judgment. 

XII. 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. 

XIII. Expiration of Final Judgment 

Unless this Court grants an extension, 

this Final Judgment shall expire ten (10) 

years from the date of its entry. 

XIV. Public Interest Determination 

Entry of this Final Judgment is in the 

public interest. The parties have 

complied with the requirements of the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. § 16, including making copies 

available to the public of this Final 

Judgment, the Competitive Impact 

Statement, and any comments thereon 

and the United States’s responses to 

comments. Based upon the record 

before the Court, which includes the 

Competitive Impact Statement and any 

comments and response to comments 

filed with the Court, entry of this Final 

Judgment is in the public interest. 

Date: 

Court approval subject to procedures of 

Antitrust Procedures and Penalties Act, 

15 U.S.C. § 16 

United States District Judge 

United States District Court for the District 

of Columbia 

United States of America, Plaintiff, v. The 

Manitowoc Company, Inc., Enodis PLC, and 

Enodis Corporation, Defendants 

Civil Action No.: 

Description: Antitrust 

Judge: 

Case: 1:08–cv–01 704 

Assigned to: Kennedy, Henry H. 

Assign. Date: 10/6/2008 

Description: Antitrust 

Competitive Impact Statement 

Plaintiff United States of America 

(‘‘United States’’), pursuant to Section 

2(b) of the Antitrust Procedures and 

Penalties Act (‘‘APPA’’ or ‘‘Tunney 

Act’’), 15 U.S.C. § 16(b)–(h), files this 

Competitive Impact Statement relating 

to the proposed Final Judgment 

submitted for entry in this civil antitrust 

proceeding. 

I. Nature and Purpose of the Proceeding 

Defendant The Manitowoc Company, 

Inc. (‘‘Manitowoc’’) and Defendant 

Enodis plc entered into an agreement, 

dated April 14, 2008, and amended May 

27, 2008, pursuant to which Manitowoc 

agreed to acquire the entire issued and 

to be issued ordinary share capital of 

Enodis plc. Manitowoc’s final revised 

offer price was determined on June 30, 

2008, when Manitowoc outbid a 

competing offer or during an auction 

process implemented by the Panel on 

Takeovers and Mergers of the United 

Kingdom. 

The United States filed a civil 

antitrust Complaint on October 6, 2008, 

seeking to enjoin the proposed 

acquisition. The Complaint alleges that 

the likely effect of this acquisition 

would be to lessen competition 

substantially in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States in violation of Section 7 

of the Clayton Act, 15 U.S.C. § 18. This 

loss of competition likely would result 

in higher prices, lower quality, and less 

innovation in the commercial cube ice 

machine market. 

At the same time the Complaint was 

filed, the United States also filed a Hold 

Separate Stipulation and Order (‘‘Hold 

Separate’’) and proposed Final 

Judgment, which are designed to 

eliminate the anticompetitive effects of 

the acquisition. Under the proposed 

Final Judgment, which is explained 

more fully below, defendants 

Manitowoc, Enodis plc, and Enodis 

Corporation (Enodis plc and Enodis 

Corporation will hereinafter be 

collectively referred to as ‘‘Enodis’’) are 

required to divest Enodis’s entire 

business engaged in the development, 

production, distribution, and sale of ice 

machines, ice machine parts, and 

related equipment in the United States 

(hereafter, the ‘‘Divestiture Business’’). 

Under the terms of the Hold Separate, 

defendants will take certain steps to 

ensure that the Divestiture Business is 

operated as a competitively 

independent, economically viable and 

ongoing business that will remain 

independent and uninfluenced by the 

consummation of the acquisition, and 

that competition is maintained during 

the pendency of the ordered divestiture. 

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 to punish violations 

thereof. 

II. Description of the Events Giving Rise 

to the Alleged Violation 

A. The Defendants and the Proposed 

Transaction 

Defendant Manitowoc is a Wisconsin 

corporation with its principal place of 

business in Manitowoc, Wisconsin. It is 

a global industrial equipment company 

that manufacturers commercial ice 

machines and related equipment, 

refrigeration equipment, cranes, and 

ships and other water vessels. In 2007, 

Manitowoc reported total sales of 

approximately $4 billion. Manitowoc’s 

sales of commercial ice machines and 

related equipment in the United States 

were approximately $152 million in 

2007. 

Enodis plc is a corporation registered 

in the United Kingdom and Wales with 

its principal place of business in 

London, England. Enodis Corporation, a 

wholly owned subsidiary of Enodis plc, 

is a Delaware corporation with its 


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headquarters in New Port Richey, 

Florida. Through its global food service 

equipment group, Enodis designs, 

manufactures, and sells cooking, food 

storage and preparation equipment, and 

ice machines and related equipment. 

Enodis plc’s revenues for its 2007 fiscal 

year were $1.6 billion. In its fiscal year 

2007, Enodis plc’s sales of commercial 

ice machines and related equipment in 

the United States were approximately 

$153 million. 

On June 30, 2008, Manitowoc offered 

to acquire Enodis plc for 328 pence in 

cash per share, in a transaction valued 

at $2.7 billion (including assumed debt). 

The proposed transaction, as initially 

agreed to by defendants, would 

substantially lessen competition in the 

development, production, distribution, 

and sale of commercial cube ice 

machines in the United States. This 

transaction is the subject of the 

Complaint and proposed Final 

Judgment filed by the United States on 

October 6, 2008. 

B. The Competitive Effects of the 

Transaction 

1. Commercial Ice Machines Generally 

Restaurants, convenience stores, 

hotels, and other businesses need 

significant volumes of ice. These 

businesses usually meet their needs by 

using commercial ice-making machines 

located at their places of business. 

These machines make ice by a 

continuous cycle of condensation and 

expansion of a refrigerant through a 

network of tubing. As the refrigerant 

converts from a compressed liquid state 

to become a gas, heat is drawn from a 

component called an evaporator. Water 

running over the evaporator surface 

freezes to form ice that is then harvested 

by processes specific to the type of ice 

produced by the machine. 

2. Relevant Product Market 

The type of ice machine purchased by 

a customer depends on the type and 

volume of ice needed. Commercial ice 

machines are designed to produce either 

hard ice or soft ice. Hard ice melts 

slowly and has a higher density and less 

surface area than soft ice. Hard ice is 

most often shaped as cubes or dice, halfcubes or half-dice, octagons, or crescent 

cubes, and is commonly referred to as 

cube ice. Most customers that serve ice 

in beverages prefer cube ice because it 

melts slowly and thus minimizes 

deterioration in the flavor of the 

beverage. 

Soft ice refers to small nuggets or 

flakes of ice that have a lower density 

and more surface area than cube ice 

and, therefore, melt more quickly than 

cube ice. Soft ice is used in hospitals, 

which demand a safe, chewable ice for 

their patients, by grocery stores or other 

establishments to display seafood, 

produce, and other perishable food, and 

for industrial cooling applications. The 

prices of commercial ice machines 

producing soft ice are often 15 to 20 

percent higher than prices of ice 

machines that produce comparable 

quantities of cube ice per day. 

The Complaint alleges that in 

response to a small but significant postacquisition increase in the price of 

commercial machines producing cube 

ice, customers would not switch to 

machines that make soft ice in sufficient 

numbers so as to make such a price 

increase unprofitable. 

Customers vary greatly with respect to 

their daily needs of cubed ice, and they 

require machines having an appropriate 

range of capacity to meet those needs. 

A significant and distinct segment of 

cube ice machine customers, including 

sit-down and fast-food restaurants, bars, 

and convenience stores, purchase 

commercial machines capable of 

producing between approximately 300 

pounds to 2,000 pounds of cube ice per 

day (hereinafter, ‘‘commercial cube ice 

machines’’). Although customers can 

purchase units that produce between 

approximately 50 and 300 pounds of ice 

per day, these machines are not able to 

meet the needs of the large majority of 

commercial cube ice machine 

customers. Few customers are likely to 

meet their needs by purchasing two or 

more smaller machines because it 

would be cost-prohibitive to do so. 

Similarly, large units that produce over 

2,000 pounds of ice per day are not 

substitutes for commercial cube ice 

machines and are used by customers 

that need extremely large volumes of 

ice, such as convention centers, sports 

arenas, or bagged-ice producers. 

The Complaint alleges that because of 

the attributes of commercial cube ice 

machines, a small but significant postacquisition increase in the prices of 

commercial cube ice machines would 

not cause customers to switch to other 

ice machines in sufficient numbers so as 

to make such a price increase 

unprofitable, and, accordingly, the 

development, production, distribution, 

and sale of commercial cube ice 

machines is a line of commerce and a 

relevant product market: 

3. Relevant Geographic Market 

Commercial ice machines are 

complex and break down more 

frequently than other types of food 

service equipment, and customers often 

need quick access to replacement 

machines, parts, and service. Sales of 

commercial cube ice machines in the 

United States by manufacturers are 

primarily made to distributors that 

supply equipment dealers and repair 

companies who sell to end-users. In 

addition, these distributors typically 

train service representatives regarding 

repair and maintenance of the 

commercial ice machines, as well as 

manage warranty claims. In order to be 

a competitive supplier of commercial 

cube ice machines within the United 

States, manufacturers must have an 

established network of local 

distribution, service, and support. 

The Complaint alleges that a small but 

significant increase in the prices of 

commercial cube ice machines would 

not cause a sufficient number of 

customers in the United States to turn 

to manufacturers of commercial cube ice 

machines that do not have an 

established a network of local 

distribution, service, and support in the 

United States. As a result, such 

manufacturers would not be able to 

constrain such an increase. Accordingly, 

the United States is a relevant 

geographic market. 

4. Competitive Effects 

The market for commercial cube ice 

machines is highly concentrated, and 

would become substantially more so if 

Manitowoc were to acquire Enodis. 

Manitowoc and Enodis are the two 

largest manufacturers of commercial 

cube ice machines in the United States. 

Manitowoc accounts for approximately 

40 percent of the sales of commercial 

cube ice machines in the United States, 

and Enodis accounts for approximately 

30 percent of such sales. Only one other 

company has demonstrated the ability 

to produce commercial cube ice 

machines of the same quality and with 

similar features as the Manitowoc and 

Enodis machines and has an established 

network of local distribution, service, 

and support in the United States. 

Combined, Manitowoc and Enodis 

would account for approximately 70 

percent of the sales of commercial cube 

ice machines in the United States. Using 

a measure of market concentration 

called the Herfindahl-Hirscbman Index 

(‘‘HHI’’), the proposed transaction 

would increase the HHI in the market 

for commercial cube ice machines by 

approximately 2,400 points to a postacquisition level of approximately 

5,500. This is well in excess of levels 

that raise significant antitrust concerns. 

The vigorous and aggressive 

competition between Manitowoc and 

Enodis in the development, production, 

distribution, and sale of commercial 

cube ice machines has benefited 

customers. Manitowoc and Enodis 


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compete directly on price, quality, and 

innovation. Although commercial cube 

ice machine offerings are differentiated, 

many commercial cube ice machine 

customers view the Manitowoc and 

Scotsman brands as close substitutes for 

one another. 

The proposed acquisition would 

eliminate the competition between 

Manitowoc and Enodis and reduce the 

number of significant manufacturers of 

commercial cube ice machines in the 

United States from three to two. The 

Complaint alleges that post-merger, 

Manitowoc would profit by unilaterally 

raising the price (or reducing quality 

and innovation) of one or more of the 

brands it would own. Although 

Manitowoc could lose some sales in that 

brand or brands as a result of such a 

price increase (or decline in quality and 

innovation), many sales would be 

diverted to one of the other brands 

under its ownership. Capturing such 

diverted sales would make a postmerger price increase (or reduction in 

quality and innovation) profitable, when 

it would not have been profitable before 

the merger. The response of other 

commercial cube ice machines 

manufacturers in the United States 

would not be sufficient to constrain a 

unilateral exercise of market power by 

Manitowoc after the acquisition because 

they do not have the incentive or the 

ability, individually or collectively, to 

do so. Therefore, the Complaint alleges, 

the proposed acquisition would enable 

Manitowoc to exercise market power 

unilaterally, lessen competition in the 

development, production, distribution, 

and sale of commercial cube ice 

machines in the United States, and lead 

to higher prices, lower quality, and less 

innovation for the ultimate consumers 

of commercial cube ice machines. 

Further, successful entry or expansion 

into the development, production, 

distribution, and sale of commercial 

cube ice machines would be difficult, 

time-consuming, and costly. Firms 

attempting to enter or expand into the 

commercial cube ice machine market 

face a combination of distribution, 

reputation, and technology-related 

barriers to entry. 

As noted above, customers need quick 

access to replacement ice machines and 

parts, and, as a result, the three 

significant commercial cube ice 

machine competitors each have a 

nationwide network of local 

distributors. These distributors maintain 

sizeable inventories at locations across 

the United States so as meet individual 

customer demands. The Complaint 

alleges that developing a nationwide 

distribution network would be difficult 

and time consuming. Finding good 

distributors would be difficult because 

each of the current three commercial 

cube ice machine competitors has 

contracted exclusively with a large 

majority of the sizeable and reputable 

distributors across the United States, 

and an existing or potential distributor 

likely would not agree to distribute a 

commercial ice machine unless it could 

be assured of a sufficient volume of 

sales of machines and parts to make a 

profit on the inventory and other 

investments it must make. Further, 

distributors must build relationships 

with the food service equipment 

dealers, air-conditioning and 

refrigeration repair companies, and 

others that sell commercial ice 

machines to end-users. Building such 

relationships would take a significant 

amount of time and effort. 

The Complaint alleges that reputation 

or brand recognition is another barrier 

to entry. Because commercial cube ice 

machines are so important to customers’ 

operations, customers are reluctant to 

purchase machines from a company that 

has not established a reputation for 

making high-quality, durable machines. 

Establishing a track record of reliable 

performance takes years. 

The Complaint alleges that the 

technology involved in developing and 

manufacturing a commercial cube ice 

machine is a third significant entry 

barrier. The three current competitors 

produce—and customers expect and 

demand—commercial cube ice 

machines that last seven to ten years, 

that consistently produce ice that is 

clear and pure under conditions of 

varying water chemistries and air and 

water temperatures, and that meet 

federal and state energy regulations. 

Designing and manufacturing 

commercial cube ice machines that have 

these characteristics and are comparable 

in quality to the machines of the three 

current competitors would take years, 

even for firms that already produce 

other types of ice machines. 

The Complaint alleges that as a result 

of these barriers to entry, entry or 

expansion by any other firm into the 

commercial cube ice machine market 

would not be timely, likely, or sufficient 

to defeat an anticompetitive price 

increase in the event that Manitowoc 

acquires Enodis. 

III. Explanation of the Proposed Final 

Judgment 

The divestiture requirement of the 

proposed Final Judgment will eliminate 

the likely anticompetitive effects of the 

acquisition in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States by establishing a new, 

independent, and economically viable 

competitor. The proposed Final 

Judgment requires defendants, within 

150 days after the filing of the 

Complaint, or five (5) days after notice 

of the entry of the Final Judgment by the 

Court, whichever is later, to divest, as a 

viable ongoing business, the Divestiture 

Business, which comprises Enodis’s 

entire business engaged in the 

development, production, distribution, 

and sale of ice machines ice machine 

parts, and related equipment in the 

United States. The assets must be 

divested in such a way as to satisfy the 

United States in its sole discretion that 

the operations can arid will be operated 

by the purchaser as a viable, ongoing 

business that can compete effectively in 

the relevant market. Defendants must 

take all reasonable steps necessary to 

accomplish the divestiture quickly and 

shall cooperate with prospective 

purchasers. 

In the event that defendants do not 

accomplish the divestiture within the 

periods prescribed in the proposed 

Final Judgment, the Final Judgment 

provides that the Court will appoint a 

trustee selected by the United States to 

effect the divestiture. If a trustee is 

appointed, the proposed Final Judgment 

provides that defendants will pay all 

costs and expenses of the trustee. The 

trustee’s commission will be structured 

so as to provide an incentive for the 

trustee based on the price obtained and 

the speed with which the divestiture is 

accomplished. After his or her 

appointment becomes effective, the 

trustee will file monthly reports with 

the Court and the United States setting 

forth his or her efforts to accomplish the 

divestiture. At the end of six months, if 

the divestiture has not been 

accomplished, the trustee and the 

United States will make 

recommendations to the Court. which 

shall enter such orders as appropriate, 

in order to carry out the purpose of the 

trust, including extending the trust or 

the term of the trustee’s appointment. 

Described below are select provisions 

that have been included in the proposed 

Final Judgment to address special 

circumstances that exist in this case. 

Some provisions address complications 

arising from certain overlaps in 

divestitures required by the United 

States and the European Commission. 

Others address the fact that certain parts 

of the Divestiture Business must be 

severed from Enodis’s other operations. 

Selected Provisions of the Proposed 

Final Judgment 

Enodis has information technology 

assets located at a data center within its 

Vernon Hills, Illinois facility that 


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1Quick divestitures have the clear benefits of 

restoring premerger competition to the marketplace 

as soon as possible, and of mitigating the potential 

dissipation of asset value associated with a lengthy 

divestiture process. Achieving these benefits are of 

as much importance in this matter as in any other, 

and section IV, paragraph A of the proposed Final 

Judgment requires defendants to use their best 

efforts to divest the Divestiture Business as 

expeditiously as possible. In this matter, and in 

most other matters, the United States. in its sole 

discretion, may agree to one or more extensions of 

the divestiture period not to exceed 60 calendar 

days in total. 

supports various Enodis businesses, 

including the Divestiture Business. 

Definition II(D) of the proposed Final 

Judgment addresses the need to sever 

these joint information technology 

assets, excluding from the list of assets 

that form the Divestiture Business all 

hardware, software, and related 

documentation (‘‘IT assets’’) at this data 

center that is shared between the 

Divestiture Business and the other 

Enodis businesses. Defendants are 

required to divest IT assets used only by 

the Divestiture Business, and to 

purchase replacement IT assets for 

installation at Vernon Hills so that all 

information technology operations used 

by the Divestiture Business will be 

maintained at levels of functionality 

equivalent or superior to those which 

exist as of the filing of the Complaint. 

Definition II(D) also requires that any 

data or information related to the 

Divestiture Business will be purged 

from hardware and backup media that 

will not be divested. Section IV, 

Paragraph C of the proposed Final 

Judgment addresses the Acquirer’s right 

to offer employment to three Enodis 

employees who provide information 

technology services and support to 

various Enodis businesses (including 

the Divestiture Business) from the 

Vernon Hills data center, but whose 

responsibilities do not relate primarily 

to the Divestiture Business as of the 

filing of the Complaint. These three 

employees are qualified to provide 

services and support that will enable the 

Acquirer to successfully operate the 

Vernon Hills data center postdivestiture. 

The European Commission has 

required defendants to divest most of 

Enodis’s worldwide ice machine assets, 

including the Divestiture Business. As a 

result of the practical difficulties of 

splitting between two acquirers rights to 

certain intellectual property shared by 

the Divestiture Business and Enodis 

plc’s European Frimont Business, 

section IV, paragraph K of the proposed 

Final Judgment requires defendants to 

sell the Divestiture Business to the 

acquirer of the Frimont Business. 

Because the United States and the 

European Commission must approve the 

same acquirer, section IV, paragraph A 

of the proposed Final Judgment 

provides that the United States will 

consult with the European Commission 

in exercising its review of defendants’ 

sale of the Divestiture Business in a 

manner consistent with the proposed 

Final Judgment, to an acquirer 

acceptable to the United States in its 

sole discretion. As noted above, if the 

defendants do not divest the Divestiture 

Business within the required time 

period, the Court, upon application of 

the United States, is to appoint a trustee 

to complete the divestiture. Because the 

European Commission also requires 

selection of a trustee if the divestiture is 

not completed within a certain time, 

section V, paragraph A of the proposed 

Final Judgment provides that the United 

States shall select a trustee after 

consultation with the European 

Commission to ensure selection of a 

trustee acceptable to both the United 

States and the European Commission. 

The United States has agreed to a 

longer-than-usual divestiture period 

also because of the overlapping 

divestitures required by the European 

Commission. Not only must an Acquirer 

be approved by the Division and the 

European Commission, but any 

potential Acquirer likely must file 

notices with, and obtain antitrust 

clearances from, multiple European 

Union member countries (or file an 

application seeking the jurisdiction of 

the European Commission) in 

connection with the Acquirer’s 

purchase of the Divestiture Business 

and other Enodis ice machine business 

assets worldwide. section IV, paragraph 

A of the proposed Final Judgment thus 

requires defendants to divest the 

Divestiture Business within 150 

calendar days after the filing of the 

Complaint, or five (5) calendar days 

after notice of the entry of the final 

judgment by the court, whichever is 

later.1

Although contracts used in the 

Divestiture Business generally must be 

divested, certain contracts that are 

unassignable or are not primarily used 

by the Divestiture Businesses are not 

required to be divested. Section P1, 

paragraph J of the proposed Final 

Judgment addresses the Acquirer’s need 

to find a source for certain input 

components typically purchased under 

such contracts. Subsection (1) requires 

that defendants provide the Acquirer 

information or documents relating to 

any product that is customized for the 

Divestiture Business and purchased 

under any such contract so the Acquirer 

has the information it may need to 

negotiate its own supply contract. 

Subsection (2) addresses the possibility 

that the Acquirer may be unable to 

negotiate its own contracts to purchase 

at commercially reasonable terms 

certain products for which alternative 

suppliers are not available as of the time 

of the divestiture. Subsection (2) 

requires defendants for a prescribed 

period to purchase and resell any such 

product to the Acquirer at the price 

specified in defendants’ current supply 

contract. To prevent the sharing of 

information that could foster 

coordination, defendants are prohibited 

from disclosing, directly or indirectly, 

information concerning such purchases 

and resales to defendant personnel 

involved in production, marketing, 

distribution, or sales of commercial 

cube ice machines. The divestiture 

provisions of the proposed Final 

Judgment will eliminate the 

anticompetitive effects of the 

acquisition in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States. 

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 defendants 

have stipulated that the proposed Final 

Judgment may be entered by the Court 

after compliance with the provisions of 

the APPA, provided that the United 

States has not withdrawn its consent. 

The APPA conditions entry upon the 

Court’s determination that the proposed 

Final Judgment is in the public interest. 

The APPA provides a period of at 

least sixty (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 


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2The 2004 amendments substituted ‘‘shall’’ for 

‘‘may’’ in directing relevant factors for court to 

consider and amended the list of factors to focus on 

competitive considerations and to address 

potentially ambiguous judgment terms. Compare 15 

U.S.C. 16(e) (2004), with 15 U.S.C. 16(e)(1) (2006); 

see also SBC Commc’ns, 489 F. Supp. 2d at 11 

(concluding that the 2004 amendments ‘‘effected 

minimal changes’’ to Tunney Act review). 

3Cf BNS, 858 F.2d at 464 (holding that the court’s 

‘‘ultimate authority under the [APPA] is limited to 

approving or disapproving the consent decree’’); 

United States v. Gillette Co., 406 F. Supp. 713, 716 

(D. Mass. 1975) (noting that, in this way, the court 

is constrained to ‘‘look at the overall picture not 

hypercritically, nor with a microscope, but with an 

artist’s reducing glass’’). See generally Microsoft, 56 

F.3d at 1461 (discussing 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’ ’’). 

Competitive Impact Statement in the 

Federal Register, or the last date of 

publication in a newspaper of the 

summary of this Competitive Impact 

Statement, whichever is later. All 

comments received during this period 

will be considered by the United States 

Department of Justice, which remains 

free to withdraw its consent to the 

proposed Final Judgment at any time 

prior to the Court’s entry of judgment. 

The comments and the response of the 

United States will be filed with the 

Court and published in the Federal 

Register. 

Written comments should be 

submitted to: Maribeth Petrizzi, Chief, 

Litigation II Section, Antitrust Division, 

United States Department of Justice, 

1401 H St., 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. 

VI. Alternatives to the Proposed Final 

Judgment 

The United States considered, as an 

alternative to the proposed Final 

Judgment, a full trial on the merits 

against defendants. The United States 

could have continued the litigation and 

sought preliminary and permanent 

injunctions against Manitowoc’s 

acquisition of Enodis plc. The United 

States is satisfied, however, that the 

divestiture of assets described in the 

proposed Final Judgment will preserve 

competition in the development, 

production, distribution, and sale of 

commercial cube ice machines in the 

United States. Thus, the proposed Final 

Judgment would achieve all or 

substantially all of the relief the United 

States would have obtained through 

litigation, but avoids the time, expense, 

and uncertainty of a full trial on the 

merits of the Complaint, while allowing 

the non-problematic aspects of the 

transaction to go forward. 

VII. Standard of Review Under the 

APPA for the Proposed Final Judgment 

The Clayton Act, as amended by the 

APPA, requires that proposed consent 

judgments in antitrust cases brought by 

the United States be subject to a 60-day 

comment period, after which the court 

shall determine whether entry of the 

proposed Final Judgment ‘‘is in the 

public interest.’’ 15 U.S.C. § 16(e)(l). In 

making that determination, the court, in 

accordance with the statute as amended 

in 2004, is required to consider: 

(A) The competitive impact of such 

judgment, including termination of 

alleged violations, provisions for 

enforcement and modification, duration 

of relief sought, anticipated effects of 

alternative remedies actually 

considered, whether its terms are 

ambiguous, and any other competitive 

considerations bearing upon the 

adequacy of such judgment that the 

court deems necessary to a 

determination of whether the consent 

judgment is in the public interest; and 

(B) The impact of entry of such 

judgment upon competition in the 

relevant market or markets, 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)(1)(A) & (B). In 

considering these statutory factors, the 

court’s inquiry is necessarily a limited 

one as the government is entitled to 

‘‘broad discretion to settle with the 

defendant within the reaches of the 

public interest.’’ United States v. 

Microsoft Corp., 56 F.3d 1448, 1461 

(D.C. Cir. 1995); see generally United 

States v. SBC Commc’ns, Inc., 489 F. 

Supp. 2d 1 (D.D.C. 2007) (assessing 

public interest standard under the 

Tunney Act).2

As the United States Court of Appeals 

for the District of Columbia Circuit has 

held, under the APPA a court considers, 

among other things, the relationship 

between the remedy secured and the 

specific allegations set forth in the 

government’s complaint, whether the 

decree is sufficiently clear, whether 

enforcement mechanisms are sufficient, 

and whether the decree may positively 

harm third parties. See Microsoft, 56 

F.3d at 1458–62. 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) (citing United States v. 

Bechtel Corp., 648 F.2d 660, 666 (9th 

Cir. 1981)); see also Microsoft, 56 F.3d 

at 1460–62; United States v. Alcoa, Inc., 

152 F. Supp. 2d 37,40 (D.D.C. 2001). 

Courts have held that: 

[t]he 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. 

Bechtel, 648 F.2d at 666 (emphasis 

added) (citations omitted).3 In 

determining whether a proposed 

settlement is in the public interest, a 

district court ‘‘must accord deference to 

the government’s predictions about the 

efficacy of its remedies, and may not 

require that the remedies perfectly 

match the alleged violations.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 17; see 

also Microsoft, 56 F.3d at 1461 (noting 

the need for courts to be ‘‘deferential to 

the government’s predictions as to the 

effect of the proposed remedies’’); 

United States v. Archer-DanielsMidland Co., 272 F. Supp. 2d 1, 6 

(D.D.C. 2003) (noting that the court 

should grant due respect to the United 

States’ prediction as to the effect of 

proposed remedies, its perception of the 

market structure, and its views of the 

nature of the case). 

Courts have greater flexibility in 

approving proposed consent decrees 

than in crafting their own decrees 

following a finding of liability in a 

litigated matter. ‘‘[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.’ ’’ United 

States v. Am. Tel. & Tel. Co., 552 F. 

Supp. 131, 151 (D.D.C. 1982) (citations 

omitted) (quoting United States v. 

Gillette Co., 406 F. Supp. 713, 716 (D. 

Mass. 1975)), aff’d sub nom. Maryland 

v. United States, 460 U.S. 1001 (1983); 

see also United States v. Alcan 

Aluminum Ltd., 605 F. Supp. 619, 622 

(W.D. Ky. 1985) (approving the consent 

decree even though the court would 

have imposed a greater remedy). To 

meet this standard, the United States 

‘‘need only provide a factual basis for 


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4See United States v. Enova Corp., 107 F. Supp. 

2d 10, 17 (D.D.C. 2000) (noting that the ‘‘Tunney 

Act expressly allows the court to make its public 

interest determination on the basis of the 

competitive impact statement and response to 

comments alone’’); United States v. Mid-Am. 

Dairymen, Inc., 1977–1 Trade Cas. (CCH) § 61,508, 

at 71,980 (W.D. Mo. 1977) (‘‘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.’’); S. Rep. No. 

93–298, 93d Cong., 1st Sess., at 6 (1973) (‘‘Where 

the public interest can be meaningfully evaluated 

simply on the basis of briefs and oral arguments, 

that is the approach that should be utilized.’’). 

concluding that the settlements are 

reasonably adequate remedies for the 

alleged harms.’’ SBC Commc’ns, 489 F. 

Supp. 2d at 17. 

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 did 

not pursue. Id. at 1459–60. As this Court 

recently confirmed in SBC 

Communications, courts ‘‘cannot look 

beyond the complaint in making the 

public interest determination unless the 

complaint is drafted so narrowly as to 

make a mockery of judicial power.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 15. 

In its 2004 amendments, Congress 

made clear its intent to preserve the 

practical benefits of utilizing consent 

decrees in antitrust enforcement, adding 

the unambiguous instruction that 

‘‘[n]othing in this section shall be 

construed to require the court to 

conduct an evidentiary hearing or to 

require the court to permit anyone to 

intervene.’’ 15 U.S.C. 16(e)(2). The 

language written into the statute what 

Congress intended when it enacted the 

Tunney Act in 1974, as Senator Tunney 

explained: ‘‘[T]he 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.’’ 

119 Cong. Rec. 24,598 (1973) (statement 

of Senator Tunney). Rather, the 

procedure for the public interest 

determination is left to the discretion of 

the court, with the recognition that the 

court’s ‘‘scope of review remains 

sharply proscribed by precedent and the 

nature of Tunney Act proceedings.’’ 

SBC Commc’ns, 489 F. Supp.2d at 11.4

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: October 6, 2008. 

Respectfully submitted, 

Helena M. Gardner, Esquire, 

Christine Hill, Esquire 

(D.C. Bar #461048), United States 

Department of Justice, Antitrust Division, 

Litigation II Section, 1401 H Street, NW., 

Suite 3000, Washington, DC 20530, (202) 

514–8518. 

[FR Doc. E8–24293 Filed 10–15–08; 8:45 am] 

BILLING CODE 4410–11–M 


rwilkins on PROD1PC63 with NOTICES2