UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
UNITED STATES OF AMERICA,
Plaintiff,
v.
VULCAN MATERIALS COMPANY and
FLORIDA ROCK INDUSTRIES, INC.,
Defendants.
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CASE NO.: 1:07-cv-02044
JUDGE: Sullivan, Emmet G.
DECK TYPE: Antitrust
DATE STAMP: April 28, 2008
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FINAL JUDGMENT
WHEREAS, plaintiff, United States of America, filed its Complaint on
November 13, 2007, and plaintiff and defendants, Vulcan Materials Company
("Vulcan") and Florida Rock Industries, Inc. ("Florida Rock"), 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 fact or law;
AND WHEREAS, defendants agree to be bound by the provisions of this
Final Judgment pending its approval by the Court;
AND WHEREAS, the essence of this Final Judgment is the prompt and
certain divestiture of certain rights or assets by 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
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 defendants under Section 7 of the Clayton
Act, as amended, 15 U.S.C. § 18.
II. DEFINITIONS
As used in this Final Judgment:
- "Acquirer" or "Acquirers" means the entity or entities to whom
defendants divest some or all of the Divestiture Assets.
- "Coarse aggregate" means crushed stone produced at quarries or mines
and used for, among other things, road base and the production of
ready mix concrete and asphalt.
- "Divestiture Assets" means:
- the following quarries and yard:
- the Florida Rock Six Mile quarry, located at 3785 Cave Springs
Road, Cedarton, Georgia;
- the Florida Rock Paulding quarry, located at 112 Quarry
Road, Yorkville, Georgia;
- the Florida Rock Tyrone quarry, located at 240 Rockwood
Road, Tyrone, Georgia;
- the Vulcan Red Oak quarry, located at 5414 Buffington Road,
Red Oak, Georgia;
- the Vulcan quarry under development in Butts County, located
on Greer Dairy Road, Jackson, Georgia;
- the Florida Rock interest in Columbus Quarry LLC, which
owns the Columbus quarry, located at 3001 Smith Road, Columbus,
Georgia;
- the Florida Rock Jersey Pike quarry, located at 2 Pelican
Drive, Chattanooga, Tennessee;
- the Florida Rock Richmond quarry, located at 2100 Deepwater
Terminal Road, Richmond, Virginia (but excluding the Florida
Rock ready mix concrete plant, the real property necessary
for the operation of the plant (provided the conveyance of
such property does not interfere with the operation of the
Richmond quarry), and all other tangible and intangible assets
exclusively used in the plant's operations) and, at the option
of the Acquirer, use of the real property, parking lot, equipment
shop, and office building equivalent to that which Florida
Rock currently has for its quarry operations; and
- the Florida Rock Gilmerton yard, located at 4606 Bainbridge
Boulevard, Chesapeake, Virginia (but excluding the Florida
Rock ready mix concrete plant, the real property necessary
for the operation of the plant (provided the conveyance of
such property does not interfere with the operation of the
Gilmerton yard), and all other tangible and intangible assets
exclusively used in the plant's operations) and, at the option
of the Acquirer, use of the real property, parking lot, equipment
shop, fuel station, and office building equivalent to that
which Florida Rock currently has for its operation of the
yard;
- all tangible assets used in or for the quarries and yard listed
in Paragraphs II(C)(1)(a) through (i), including but not limited
to all research and development activities (except for any such
research and development activities that are principally devoted
to either defendant's operations as a whole and not specifically
to the operations of the quarries and yard listed in Paragraphs
II(C)(1)(a) through (i), and that are not necessary to the operation
of the quarries and yard listed in Paragraphs II(C)(1)(a) through
(i)), equipment, tooling and fixed assets, real property (leased
or owned), personal property, inventory, coarse aggregate reserves,
office furniture, materials, supplies, on- or off-site warehouses
or storage facilities relating to the quarries and yard; all licenses,
permits, and authorizations issued by any governmental organization
relating to the quarries and yard; all contracts, teaming arrangements,
agreements, leases (including renewal rights), commitments, certifications,
and understandings relating to the quarries and yard, including
sales agreements and supply agreements; all customer lists, contracts,
accounts, and credit records relating to the quarries and yard;
all repair and performance records and all other records relating
to the quarries and yard; at the option of the Acquirer or Acquirers,
a number of trucks, rail cars, and other vehicles usable at the
quarries and yard listed in Paragraphs II(C)(1)(a) through (i)
equal to, for each separate type of truck, rail car, or other
vehicle, the average number of trucks, rail cars, and other vehicles
of that type, owned or controlled by defendants, used at each
such quarry or yard per month during the months of operation of
the quarry or yard between January 1, 2006 and December 31, 2006
(calculated by averaging the number of trucks, rail cars, and
other vehicles of each type, owned or controlled by defendants,
that were used at each quarry or yard at any time during each
month that the quarry or yard was in operation); and at the option
of the Acquirer or Acquirers, a number of barges usable at the
quarry and yard listed in Paragraphs II(C)(1)(h) and (i) equal
to, for each separate type of barge, the average number of barges
of that type, owned or controlled by defendants, used at such
quarry or yard per month during the months of operation of the
quarry or yard between January 1, 2006 and December 31, 2006 (calculated
by averaging the number of barges of that type, owned or controlled
by defendants, that were used at such quarry or yard at any time
during each month that the quarry or yard was in operation); and
- all intangible assets used in the development, production, servicing,
distribution, and sale of products produced by or in the quarries
or stored in the yard listed in Paragraphs II(C)(1)(a) through
(i), including but not limited to all contractual rights (except
for any such contractual rights that are principally devoted to
either defendant's operations as a whole and not specifically
to the operations of the quarries and yard listed in Paragraphs
II(C)(1)(a) through (i), and that are not necessary to the operation
of the quarries and yard listed in Paragraphs II(C)(1)(a) through
(i)), patents, licenses and sub-licenses, intellectual property
rights, copyrights, trademarks, trade names, service marks, service
names, technical information, know-how, trade secrets, drawings,
blueprints, designs, design protocols, specifications for materials,
specifications for parts and devices, safety procedures for the
handling of materials and substances, quality assurance and control
procedures, all manuals and technical information defendants provide
to their own employees, customers, suppliers, agents, or licensees,
and all research data (including coarse aggregate reserve testing
information) concerning historic and current research and development
efforts relating to the quarries and yard, including but not limited
to designs of experiments and the results of successful and unsuccessful
designs and experiments. Notwithstanding anything to the contrary
in this Final Judgment, if requested by an Acquirer, and subject
to approval by the United States in its sole discretion, defendants
shall offer to enter into a transition services agreement with
respect to computer software (including dispatch software and
management information systems) and related documentation, and
design tools and simulation capability.
- "Florida Rock" means defendant Florida Rock Industries, Inc., a
Florida corporation with its headquarters in Jacksonville, Florida,
its successors and assigns, and its subsidiaries, divisions, groups,
affiliates, partnerships and joint ventures, and their directors,
officers, managers, agents, and employees.
- "Vulcan" means defendant Vulcan Materials Company, a New Jersey
corporation with its headquarters in Birmingham, Alabama, its successors
and assigns, and its subsidiaries, divisions, groups, affiliates,
partnerships and joint ventures, and their directors, officers, managers,
agents, and employees.
III. APPLICABILITY
- This Final Judgment applies to Vulcan and Florida Rock, as defined
above, and all other persons in active concert or participation with
Vulcan or Florida Rock who receive actual notice of this Final Judgment
by personal service or otherwise.
- If, prior to complying with Sections 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
Assets, they shall require the purchaser to be bound by the provisions
of this Final Judgment. Defendants need not obtain such an agreement
from the acquirers of the assets divested pursuant to this Final Judgment.
IV. DIVESTITURES
- Defendants are ordered and directed, within ninety (90) calendar
days after the filing of the Complaint in this matter, or five (5)
days after notice of the entry of this Final Judgment by the Court,
whichever is later, to divest the Divestiture Assets in a manner consistent
with this Final Judgment to an Acquirer or Acquirers acceptable to
the United States in its sole discretion. The United States, in its
sole discretion, may agree to one or more extensions of this time
period, not to exceed in total sixty (60) calendar days,
and shall notify the Court in each such circumstance. Defendants agree
to use their best efforts to divest the Divestiture Assets as expeditiously
as possible.
- In accomplishing the divestitures ordered by this Final Judgment,
defendants promptly shall make known, by usual and customary means,
the availability of the Divestiture Assets. Defendants shall inform
any person making inquiry regarding a possible purchase of the Divestiture
Assets that they are being divested pursuant to this Final Judgment
and provide that person with a copy of this Final Judgment. Unless
the United States otherwise consents in writing, defendants shall
offer to furnish to all prospective Acquirers, subject to customary
confidentiality assurances, all information and documents relating
to the Divestiture Assets customarily provided in a due diligence
process except such information or documents subject to the attorney-client
or work-product privileges. Defendants shall make available such information
to the United States at the same time that such information is made
available to any other person.
- Defendants shall not take any action that will impede in any way
any person from competing for or obtaining the lease to the Branscome
Chesapeake yard, located at 120 Dominion Boulevard, Chesapeake, Virginia.
- Unless the United States otherwise consents in writing, defendants
shall provide the Acquirer or Acquirers and the United States information
relating to personnel involved in production, operations, development,
and sales at the Divestiture Assets to enable the Acquirer or Acquirers
to make offers of employment. Defendants shall not interfere with
any negotiations by the Acquirer or Acquirers to employ any employee
of the Divestiture Assets whose primary responsibility is production,
operations, development, or sales at the Divestiture Assets.
- Unless the United States otherwise consents in writing, defendants
shall permit prospective Acquirers of the Divestiture Assets to have
reasonable access to personnel and to make inspections of the physical
facilities of the Divestiture Assets; 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.
- With the exception of the Butts County site listed in Paragraph
II(C)(1)(e), defendants shall warrant to the Acquirer or Acquirers
that each asset will be operational on the date of sale. Vulcan shall
further warrant to the Acquirer that it has obtained all environmental,
zoning, or other permits required to produce coarse aggregate at the
Vulcan quarry under development in Butts County, identified in Paragraph
II(C)(1)(e), and that such permits are transferable to the Acquirer.
- Defendants shall not take any action that will impede in any way
the permitting, operation, or divestiture of the Divestiture Assets.
- Defendants shall warrant to the Acquirer or Acquirers that there
are no material defects in the environmental, zoning, or other permits
pertaining to the operation of the Divestiture Assets. Defendants
shall not undertake, directly or indirectly, any challenges to the
environmental, zoning, or other permits relating to the operation
of the Divestiture Assets.
- Unless the United States otherwise consents in writing, any divestiture
pursuant to Section IV, or by trustee appointed pursuant to Section
V, of this Final Judgment, shall include the entire Divestiture Assets,
and shall be accomplished in such a way as to satisfy the United States,
in its sole discretion, that the Divestiture Assets can and will be
used by the Acquirer or Acquirers as viable, ongoing businesses engaged
in producing and distributing coarse aggregate, that the Divestiture
Assets will remain viable, and that the divestiture of such assets
will remedy the competitive harm alleged in the Complaint. The sale
of the Divestiture Assets may be made to one or more Acquirers, so
long as the Florida Rock Richmond quarry, identified in Paragraph
II(C)(1)(h) above, and the Florida Rock Gilmerton yard, identified
in Paragraph II(C)(1)(i) above, are divested to a single Acquirer.
The divestitures, whether pursuant to Section IV or Section V of this
Final Judgment:
- shall be made to an Acquirer or Acquirers that, in the United
States's sole judgment, has the intent and capability (including
the necessary managerial, operational, technical and financial
capability) to compete effectively in the production,
distribution, and sale of coarse aggregate; and
- shall be accomplished so as to satisfy the United States, in
its sole discretion, that none of the terms of any agreement between
an Acquirer or Acquirers and defendants gives defendants the ability
to unreasonably 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 production, distribution, and sale
of coarse aggregate.
V. APPOINTMENT OF TRUSTEE TO EFFECT DIVESTITURES
- If defendants have not divested the Divestiture Assets within the
time period specified in Paragraph IV(A), defendants shall notify
the United States of that fact in writing. Upon application of the
United States, the Court shall appoint a trustee selected by the United
States and approved by the Court to effect the divestiture of the
Divestiture Assets.
- After the appointment of a trustee becomes effective, only the trustee
shall have the right to sell the Divestiture Assets. The trustee shall
have the power and authority to accomplish the divestiture to an Acquirer
acceptable to the United States at such price and on such terms as
are then obtainable upon reasonable effort by the trustee, subject
to the provisions of Sections IV, V, and VI of this Final Judgment,
and shall have such other powers as this Court deems appropriate.
Subject to Paragraph V(D) of this Final Judgment, the trustee may
hire at the cost and expense of defendants any investment bankers,
attorneys, or other agents, who shall be solely accountable to the
trustee, reasonably necessary in the trustee's judgment to assist
in the divestiture.
- Defendants shall not object to a sale by the trustee on any ground
other than the trustee's malfeasance. Any such objection by defendants
must be conveyed in writing to the United States and the trustee within
ten (10) calendar days after the trustee has provided the notice required
under Section VI.
- The trustee shall serve at the cost and expense of defendants, on
such terms and conditions as the United States approves, and shall
account for all monies derived from the sale of the assets sold by
the trustee and all costs and expenses so incurred. After approval
by the Court of the trustee's accounting, including fees for its services
and those of any professionals and agents retained by the trustee,
all remaining money shall be paid to defendants and the trust shall
then be terminated. The compensation of the trustee and any professionals
and agents retained by the trustee shall be reasonable in light of
the value of the Divestiture Assets and based on a fee arrangement
providing the trustee with an incentive based on the price and terms
of the divestiture and the speed with which it is accomplished, but
timeliness is paramount.
- 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 secrets 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.
- 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 contain information that the trustee deems
confidential, such reports shall not be filed in the public docket
of the Court. Such reports shall include the name, address, and telephone
number of each person who, during the preceding month, made an offer
to acquire, expressed an interest in acquiring, entered into negotiations
to acquire, or was contacted or made an inquiry about acquiring any
interest in the Divestiture Assets, and shall describe in detail each
contact with any such person. The trustee shall maintain full records
of all efforts made to divest the Divestiture Assets.
- If the trustee has not accomplished the divestitures ordered under
this Final Judgment within six 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 report contains information that the trustee deems confidential,
such report 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 DIVESTITURES
- Within two (2) business days following execution of a definitive
divestiture agreement, defendants or the trustee, whichever is then
responsible for effecting the divestiture required herein, shall notify
the United States of any proposed divestiture required by Section
IV or V of this Final Judgment. If the trustee is responsible, it
shall similarly notify defendants. The notice shall set forth the
details of the proposed divestiture and list the name, address, and
telephone number of each person not previously identified who offered
or expressed an interest in or desire to acquire any ownership interest
in the Divestiture Assets, together with full details of the same.
- Within fifteen (15) calendar days of receipt by the United States
of such notice, the United States may request from defendant, the
proposed Acquirer or Acquirers, any other third party, or the trustee,
if applicable, additional information concerning the proposed divestiture,
the proposed Acquirer or Acquirers, 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.
- 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 defendant, the
proposed Acquirer or Acquirers, any third party, or 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 defendant's limited right to object to the sale under
Paragraph V(C) of this Final Judgment. Absent written notice that
the United States does not object to the proposed Acquirer or upon
objection by the United States, a divestiture proposed under Section
IV or Section V shall not be consummated. Upon objection by defendants
under Paragraph V(C), a divestiture proposed under Section V shall
not be consummated unless approved by the Court.
VII. FINANCING
Defendants shall not finance all or any part of any purchase made pursuant
to Section IV or V of this Final Judgment.
VIII. HOLD SEPARATE
Until the divestitures required by this Final Judgment have 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
- Within twenty (20) calendar days of the filing of the Complaint
in this matter, and every thirty (30) calendar days thereafter until
the divestitures have been completed under Section IV or V, defendants
shall deliver to the United States an affidavit as to the fact and
manner of their compliance with Section IV or V of this Final Judgment.
Each such affidavit shall include the name, address, and telephone
number of each person who, during the preceding thirty (30) 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 Assets, 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
Assets, and to provide required information to any prospective Acquirer,
including the limitations, if any, on such information. Assuming the
information set forth in the affidavit is true and complete, any objection
by the United States to information provided by defendants, including
limitations on the information, shall be made within fourteen (14)
calendar days of receipt of such affidavit.
- 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.
- Defendants shall keep all records of all efforts made to preserve
and divest the Divestiture Assets until one year after such divestitures
have been completed.
X. COMPLIANCE INSPECTION
- 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, 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:
- access during defendants' office hours to inspect and copy,
or at the option of the United States, to require defendants to
provide hard 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
- to interview, either informally or on the record, defendants'
officers, employees, or agents, who may have their individual
counsel present, regarding such matters. The interviews shall
be subject to the reasonable convenience of the interviewee and
without restraint or interference by defendant.
- 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.
- 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.
- If, at the time information or documents are furnished by defendants
to the United States, defendants represent and identify in writing
the material in any such information or documents to which a claim
of protection may be asserted under Rule 26(c)(7) of the Federal Rules
of Civil Procedure, and defendants mark each pertinent page of such
material, "Subject to claim of protection under Rule 26(c)(7) of the
Federal Rules of Civil Procedure," then the United States shall give
defendants ten (10) calendar days notice prior to divulging such material
in any legal proceeding (other than a grand jury proceeding).
XI. NO REACQUISITION
Defendants may not reacquire any part of the Divestiture Assets 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 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: 4/28/08
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Court approval subject to procedures of
the Antitrust
Procedures and Penalties Act, 15 U.S.C. § 16.
_______________/s/________________
United States District Judge
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