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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA UNITED STATES OF AMERICA, ) ) Plaintiff, ) ) Case No.: 1:96CV00297 ) v. ) Judge: Thomas Penfield Jackson ) ) BROWNING-FERRIS INDUSTRIES OF ) IOWA, INC., ) BROWNING-FERRIS INDUSTRIES OF ) TENNESSEE, INC., and ) BROWNING-FERRIS INDUSTRIES, INC.) ) ) Defendants. ) MOTION FOR ENTRY OF FINAL JUDGMENT Pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act, ("APPA"), 15 U.S.C. ï½§ 16 (b)-(h), the United States of America moves for entry of the proposed Final Judgment in this civil antitrust proceeding. The Final Judgment may be entered at this time without further hearing, if the Court determines that entry is in the public interest. A Certificate of Compliance, certifying that the parties have complied with all applicable provisions of the APPA and that the waiting period has expired, has been filed simultaneously with this Court.
I. Background The action was commenced on February 15, 1996, when the United States filed a civil antitrust complaint to prevent and restrain defendants Browning-Ferris Industries of Iowa, Inc. ("BFII"), Browning-Ferris Industries of Tennessee, Inc. (BFIT") and Browning-Ferris Industries, Inc. ("BFI") from maintaining and enhancing their market power in small containerized solid waste hauling service in the Dubuque and Memphis markets by using contracts in those markets that have restrictive and anticompetitive effects, in violation of Section 2 of the Sherman Act, 15 U.S.C. ï½§2. Specifically, the Complaint alleges that: (1) Defendant BFIT has market power in small containerized hauling service in the Memphis, TN market and Defendant BFII has market power in small containerized hauling service in the Dubuque, IA market; (2) Defendants, acting with specific intent, used and enforced contracts containing restrictive provisions to exclude and constrain competition and to maintain and enhance their market power in small containerized hauling service in those markets; (3) in the context of their large market shares and market power, Defendants' use and enforcement of those contracts in the Dubuque and Memphis markets has had anticompetitive and exclusionary effects by significantly increasing barriers to entry facing new entrants and barriers to
expansion faced by small incumbents; (4) Defendants' market power is maintained and enhanced by their use and enforcement of those contracts; and (5) as a result, there is a dangerous probability that Defendants will achieve monopoly power in the Dubuque and Memphis markets in violation of Section 2 of the Sherman Act. Simultaneously with the filing of the Complaint, the United States filed a proposed Final Judgment, a Stipulation signed by the parties stipulating to entry of the Final Judgment, and a Competitive Impact Statement. The proposed Final Consent Judgment requires that, in dealing with small-container customers in the Dubuque and Memphis markets, Defendants only enter into contracts containing significantly less restrictive terms than the contracts they now use in those markets. Specifically, the Defendants will be prohibited from using any contract with small- container customers in the Dubuque and Memphis markets that: (1) Has an initial term longer than two years (unless a longer term ins requested by the customer and other conditions are met); (2) Has any renewal term longer than one year; (3) Requires that the customer give notice of termination more than 30 days prior to the end of a term; (4) Requires the customer to pay liquidated damages over 3 times the greater of its prior monthly charge or its average monthly charge during the first year of the initial term of the customer's contract, or over 2 times the greater of its prior
monthly charge or its average monthly charge thereafter; (5) Is not labeled "Contract for Solid Waste Services" and is not easily readable; or (6) Requires a customer to give BFI the right or opportunity to provide hauling services for all solid wastes and recyclables, unless the customer affirmatively indicates that is its desire. Furthermore, Defendants would be prohibited from enforcing provisions in existing contracts that are inconsistent with the Final Judgment. The Competitive Impact Statement explains the basis for the Complaint and the reasons why entry of the proposed Final Judgment would be in the public interest. The Stipulation provides that the proposed Final Judgment may be entered by the Court after the completion of the procedures required by the APPA. II. Compliance with the APPA The APPA requires defendants to file a description of communications with any officer or employee of the United States concerning the proposed Final Judgment, 15 U.S.C. ï½§ 16(g). The APPA also requires a sixty-day period for the submission of public comments on the proposed Final Judgment, 15 U.S.C. ï½§ ï½§ 16(b) and (d). In this case, the sixty-day comment period commenced on March 5, 1996 and terminated on May 6, 1996. Finally, the APPA requires a sixty-day period for the submission of public comments following publication in an appropriate
newspaper, 15 U.S.C. ï½§ 16(c). During these periods, the United States received no comments from the public on the proposed Final Judgment. Upon the expiration of both comment periods on May 6, 1996, the procedures required by the APPA prior to entry of the proposed Final Judgment were completed. The Certificate of Compliance filed by the United States with this Court simultaneously with this Motion demonstrates that the requirements of the APPA have been met. It is now appropriate for the Court to make the public interest determination required by 15 U.S.C. ï½§ 16(e) and to enter the Final Judgment. The Court will retain jurisdiction to construe, modify or enforce the Final Judgment. III. Standard of Judicial Review Before entering the proposed Final Judgment, the Court is to determine that the Judgment "is in the public interest." In making that determination, the court may consider: (1) the competitive impact of such judgment, including termination of alleged violations, provisions for enforcement and modification, duration or relief sought, anticipated effects of alternative remedies actually considered, and any other considerations bearing upon the adequacy of such judgment; (2) the impact of entry of such judgment upon the
public generally and individuals alleging specific injury from the violations set forth in the complaint including consideration of the public benefit, if any, to be derived from a determination of the issues at trial. 15 U.S.C. ï½§ 16(e) (emphasis added). In its Competitive Impact Statement, the United States has explained the meaning and proper application of the public interest standard under the APPA, and incorporates those statements here by reference. The public, including affected competitors and customers, has had opportunity to comment on the proposed Final Judgment as required by law, and no one has contended that entry of the proposed Final Judgment would as a whole be contrary to the public interest. There has been no showing that the proposed settlement constitutes an abuse of the Department's discretion or that it is not within the zone of settlements consistent with the public interest. IV. Conclusion For the reasons set forth in this Motion, in the Competitive Impact Statement and in the Certificate of Compliance, the Court should find that the proposed Final Judgment is in the public interest and should enter the proposed Final Judgment without further hearings. The United States has consulted with defendants; defendants have authorized the United States to
represent that defendants have no objection to entry of the Final Judgment. The United States requests that the proposed Final Judgment be entered expeditiously. Dated: May 14, 1996 Respectfully submitted, Nancy H. McMillen Attorney United States Department of Justice Antitrust Division 1401 H Street, N.W. Suite 3700 Washington, D.C. 20530 (202) 307-5777
CERTIFICATE OF SERVICE I hereby certify that on this ___ day of May, 1996, I have caused to be served by first class mail, postage prepaid, a copy of the foregoing Certificate of Compliance with Provisions of the Antitrust Procedures and Penalties Act upon the following persons: Counsel for Defendants Browning-Ferris Industries of Iowa, Inc., Browning-Ferris Industries of Tennessee, Inc., and Browning-Ferris Industries, Inc.: Rufus Wallingford, Esquire Senior Vice President & General Counsel Browning-Ferris Industries, Inc. 757 N. Eldridge at Memorial Drive Houston, Texas 77079 David M. Foster, Esquire Fulbright & Jaworski L.L.P. 801 Pennsylvania Ave., NW Market Square Washington, D.C. 20004-2604 Lee J. Keller, Esquire Senior Attorney Browning-Ferris Industries, Inc. 757 N. Eldridge at Memorial Drive Houston, Texas 77079 Richard N. Carrell, Esquire Fulbright & Jaworski L.L.P. 1301 McKinney Suite 5100 Houston, Texas 77010-3095 ___________________________ Nancy H. McMillen Attorney, Litigation I Section Antitrust Division U.S. Department of Justice 1401 H Street, N.W., Suite 3700 Washington, D.C. 20530 Counsel for Plaintiff United States of America (202) 307-5777.