United States and State of New York v. Stericycle, Inc., et al.; Proposed Final Judgment and Competitive Impact Statement, 21006-21017 [2011-9106]

Download as PDF 21006 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices Fulton County Hotel Broadalbin, 59 W. Main St., Broadalbin, 11000252 DEPARTMENT OF JUSTICE Rensselaer County Dickinson Hill Fire Tower, Fire Tower Rd., Grafton, 11000253 NORTH CAROLINA McDowell County Old Fort Commercial Historic District, Roughly bounded by E. Main, Spring, Commerce & W. Main Sts., Old Fort, 11000257 VIRGINIA Albemarle County Greenwood—Afton Rural Historic District, Roughly 5 to 7 mi. N. & S. of I–64, Greenwood—Afton, 11000258 WASHINGTON Clallam County Port Angeles Civic Historic District, 205, 215, 217 & 319 S. Lincoln St., Port Angeles, 11000259 WEST VIRGINIA Hampshire County Hook’s Tavern, Jct. of US 50 & Smokey Hollow Rd., Capon Bridge, 11000260 North River Mills Historic District, Jct. Cnty. Rds. 45⁄20 & 4⁄2, North River Mills, 11000261 [FR Doc. 2011–9038 Filed 4–13–11; 8:45 am] BILLING CODE 4312–51–P INTERNATIONAL TRADE COMMISSION [USITC SE–11–009] Government in the Sunshine Act Meeting United States International Trade Commission. ORIGINAL DATE AND TIME: April 12, 2011 at 11 a.m. NEW DATE AND TIME: April 14, 2011 at 1:30 p.m. PLACE: 500 E Street, SW., Washington, DC 20436, Telephone: (202) 205–2000. STATUS: Open to the public. In accordance with 19 CFR 201.35(d)(1), the Commission has determined to reschedule the meeting of 11 a.m., April 12, 2011 to 1:30 p.m., April 14, 2010. Earlier announcement of this rescheduling was not possible. mstockstill on DSKH9S0YB1PROD with NOTICES AGENCY HOLDING THE MEETING: By order of the Commission. Issued: April 11, 2011. James R. Holbein, Acting Secretary to the Commission. [FR Doc. 2011–9140 Filed 4–12–11; 11:15 am] BILLING CODE 7020–02–P VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 Notice of Lodging of Consent Decrees Under the Comprehensive Environmental Response, Compensation and Liability Act Under 28 CFR 50.7, notice is hereby given that on April 8, 2011, four proposed consent decrees signed by defendants Arch Coal, Inc., K&M Investors, Inc., Momentive Specialty Chemicals, Inc., and SWEPI LP were lodged in the civil action United States v. Arch Coal, Inc., et al., Civil Action No. 1:11–cv–00055, in the United States District Court for the Eastern District of Missouri, Southeastern Division. In this action the United States is seeking response costs pursuant to Section 107 of the Comprehensive Environmental Response, Compensation and Liability Act (‘‘CERCLA’’), 42 U.S.C. 9607, for costs incurred in response to releases of hazardous substances at the Missouri Electric Works Superfund Site (‘‘the Site’’), in Cape Girardieu, Missouri. The proposed consent decrees will resolve the United States’ claims against the four defendants under Section 107 of CERCLA, 42 U.S.C. 9607, at the Site. Under the terms of the proposed consent decree, the defendants will make the following cash payments to the United States: Arch Coal, $21,850.58; K&M Investors, $89,569.12; Momentive Specialty Chemicals, $2,441.70; and SWEPI, $31,167.05. In return, the United States will grant all four defendants covenants not to sue under CERCLA with respect to the Site. The Department of Justice will receive for a period of thirty (30) days after the date of this publication comments relating to the proposed consent decrees. Comments should be addressed to the Assistant Attorney General, Environment and Natural Resources Division, P.O. Box 7611, U.S. Department of Justice, Washington, DC 20044–7611, and should refer to the proposed consent decrees with defendants Arch Coal, K&M Investors, Momentive Specialty Chemicals, and SWEPI in United States v. Arch Coal, Inc., et al., D.J. Ref. 90–11–2–614/3. The proposed consent decrees may be examined at the office of the United States Attorney, 111 S. 10th Street, 20th Floor, St. Louis, Missouri 63102. During the public comment period, the Consent Decrees may be examined on the following Department of Justice Web site: https://www.usdoj.gov/enrd/ Consent_Decrees.html and at the Consent Decree Library, P. O. Box 7611, U.S. Department of Justice, Washington, DC 20044–7611 or by faxing a request to PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 Tonia Fleetwood, fax no. (202) 514– 0097, phone confirmation number (202) 514–1547. In requesting a copy please refer to the referenced case and enclose a check in the amount of $18.00 (25 cents per page reproduction costs), payable to the U.S. Treasury. Public comments may be submitted by email to the following e-mail address: pubcommentees.enrd@usdoj.gov. Robert E. Maher, Jr., Assistant Section Chief, Environmental Enforcement Section, Environment and Natural Resources Division. [FR Doc. 2011–8967 Filed 4–13–11; 8:45 am] BILLING CODE 4410–15–P DEPARTMENT OF JUSTICE Antitrust Division United States and State of New York v. Stericycle, 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 and Competitive Impact Statement have been filed with the United States District Court for the District of Columbia in United States of America and State of New York v. Stericycle, Inc., et al., Civil Action No. 1:11–cv–00689. On April 8, 2011, the United States and the attorney general for the State of New York filed a Complaint alleging that the proposed acquisition by Stericycle, Inc. of Healthcare Waste Solutions (‘‘HWS’’) would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The proposed Final Judgment, filed the same time as the Complaint, requires Stericycle and HWS to divest HWS’s Bronx, New York transfer station, which is used in the provision of infectious waste treatment services for customers in the New York City metropolitan area. Copies of the Complaint, proposed Final Judgment, 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 https:// 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 a copying fee set by Department of Justice regulations. E:\FR\FM\14APN1.SGM 14APN1 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices 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, U.S. Department of Justice, 450 Fifth Street, NW., Suite 8700, Washington, DC 20530 (telephone: 202– 307–0924). Patricia A. Brink, Director of Civil Enforcement. United States District Court for the District of Columbia United States of America, Department of Justice, Antitrust Division, 450 Fifth Street, NW., Suite 8700, Washington, DC 20530, and State of New York, Office of the Attorney General, Antitrust Bureau, 120 Broadway, New York, New York 10271, Plaintiffs, v. Stericycle, Inc., 28161 North Keith Drive, Lake Forest, Illinois 60045, SAMW Acquisition Corporation, 28161 North Keith Drive, Lake Forest, Illinois 60045, and Healthcare Waste Solutions, Inc., 4357 Ferguson Drive, Suite 100, Cincinnati, Ohio 45245, Defendants. Case No.: 1:11-cv-00689 Assigned To: Howell, Beryl A. Assign. Date: 4/8/2011 Description: Antitrust Complaint Plaintiffs, the United States of America (‘‘United States’’), acting under the direction of the Attorney General of the United States, and the State of New York, acting under the direction of its Attorney General, bring this civil antitrust action against defendants, Stericycle, Inc., SAMW Acquisition Corporation, and Healthcare Waste Services, Inc. (‘‘HWS’’), to enjoin Stericycle’s proposed acquisition of HWS and to obtain other equitable relief. Plaintiffs complain and allege as follows: mstockstill on DSKH9S0YB1PROD with NOTICES I. Nature of the Action 1. Pursuant to an agreement and plan of merger dated September 24, 2010, Stericycle intends to acquire all of HWS, except for an incinerator in Matthews, North Carolina, for $245 million. Defendants Stericycle and HWS currently compete in the treatment of infectious waste. 2. The United States and the State of New York bring this action to prevent the proposed acquisition because it would substantially lessen competition in the provision of infectious waste treatment services in the New York City Metropolitan Area, in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 II. Jurisdiction and Venue 3. The United States brings this action under Section 15 of the Clayton Act, as amended, 15 U.S.C. 4 and 25, to prevent and restrain defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18. The State of New York brings this action under Section 16 of the Clayton Act, 15 U.S.C. 26, to prevent and restrain defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18. The State of New York, by and through its Attorney General, brings this action on behalf of the citizens, general welfare, and economy of the State of New York. 4. Defendants treat infectious waste in the flow of interstate commerce. Defendants’ activities in treating infectious waste substantially affect interstate commerce. The Court has jurisdiction over this action and over the parties pursuant to 15 U.S.C. 22 and 28 U.S.C. 1331 and 1337. 5. Defendants have consented to venue and personal jurisdiction in this District. Venue is therefore proper in this District under Section 12 of the Clayton Act, 15 U.S.C. 22 and 28 U.S.C. 1391(c). III. The Defendants 6. Defendant Stericycle, Inc. is a Delaware corporation with its principal place of business in Lake Forest, Illinois. Stericycle, a multi-national company, is the largest provider of infectious waste treatment services in the United States, with operations in all 50 states, including 54 treatment facilities. In 2009, Stericycle had U.S. revenues of $913 million. SAMW Acquisition Corporation is a corporation formed by Stericycle to facilitate its acquisition of HWS. Stericycle and SAMW hereinafter are collectively referred to as ‘‘Stericycle’’. 7. Defendant Healthcare Waste Solutions (‘‘HWS’’) is a Delaware corporation with its principal place of business in Cincinnati, Ohio. HWS is the second-largest provider of infectious waste treatment services in the United States, with operations in 15 states that include six treatment facilities. In 2009, HWS had total revenue of about $31 million. IV. Trade and Commerce A. Background 8. Regulated medical waste is waste generated in the diagnosis, treatment, or immunization of human beings or animals. There are generally three types of regulated medical waste: (1) Infectious waste; (2) pathological waste; and (3) trace chemotherapy waste. Infectious waste is waste that has come PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 21007 into contact with bodily fluids and ‘‘sharps’’ waste, such as syringes and scalpels. Pathological waste is anatomical parts, and trace chemotherapy waste is small amounts of chemical compounds used to treat cancer patients and the equipment used to administer the compounds. Infectious waste comprises approximately 90 percent of the regulated medical waste generated in the United States. 9. State and federal governments heavily regulate the treatment of regulated medical waste. They prescribe how each type of regulated medical waste must be stored, collected, and treated. Providers of infectious waste treatment services are required to be licensed by various state and federal regulatory agencies before they can offer such services. 10. Regulated medical waste must be stored separately from other types of waste, and each type of regulated medical waste must be stored separately from the other types in specially marked and sealed containers. 11. State-approved treatment facilities must be used to render infectious waste non-infectious. Failure to use stateapproved treatment facilities subjects both the generator of the infectious waste and the infectious waste treatment service provider to criminal prosecution, fines, damage actions, and potentially high clean-up costs. 12. Autoclave sterilization is the most common treatment for infectious waste. An autoclave uses steam sterilization combined with pressure to render infectious waste non-infectious. Autoclave sterilization is not approved for pathological or trace chemotherapy waste, which instead must be incinerated in a specially licensed medical waste incinerator. 13. Infectious waste is typically collected from generator sites (e.g., hospitals and physician offices) on daily route trucks and then transported to treatment facilities. Route trucks are vans and, more typically, 16- to 24-foot straight trucks. A daily route truck typically travels a route within a 75- to 100-mile radius of its garage. 14. Obtaining approval for an infectious waste treatment facility in and around large urban areas, such as New York City, is difficult. Only one such commercial facility operates in the New York City Metropolitan area. Transporting large volumes of infectious waste to distant treatment facilities using daily route trucks is not costeffective. Therefore, service providers serve such areas by using local transfer stations. 15. Once the daily route truck has delivered the infectious waste to a local E:\FR\FM\14APN1.SGM 14APN1 21008 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES transfer station, the collection function is completed. At a transfer station, containers of infectious waste are unloaded from the daily route trucks and loaded onto tractor trailers for efficient shipment to more distant treatment facilities. 16. The size of the market for the provision of infectious waste treatment services is largely influenced by transportation costs because such costs represent a large share of the total cost of providing treatment services. 17. Defendants Stericycle and HWS own and operate numerous autoclave facilities for the treatment of infectious waste. Stericycle’s and HWS’s closest facilities to New York City are located in Sheridan and Oneonta, New York; Woonsocket, Rhode Island; and Morgantown and Marcus Hook, Pennsylvania. The closest of these is about 180 miles from New York City. It is not cost-effective to transport large volumes of infectious waste to these distant facilities using daily route trucks. 18. Stericycle and HWS operate local transfer stations in and around New York City and compete to provide infectious waste treatment services by serving customers through these local transfer stations. 19. In and around New York City, Stericycle owns and operates local transfer stations in the Bronx, Staten Island, West Babylon, and Farmingdale, New York. Stericycle also owns local transfer stations in Piscataway and Bloomfield, New Jersey. HWS owns and operates a local transfer station in the Bronx, New York. 20. In the New York City Metropolitan Area, encompassing the City of New York, and the counties of Westchester, Rockland, Nassau, and Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, Union, and Middlesex in New Jersey, and the county of Fairfield in Connecticut, apart from one small competitor, no other infectious waste treatment service provider has a local transfer station located within approximately 100 miles of Stericycle’s or HWS’s local transfer stations. B. Relevant Market 21. The provision of infectious waste treatment services to customers in the New York City Metropolitan Area is a line of commerce and relevant price discrimination service market within the meaning of Section 7 of the Clayton Act. 22. Infectious waste treatment differs from treatment for other types of waste, including other types of regulated medical waste. There are no legal alternatives to treating infectious waste VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 other than using an approved treatment technology, such as autoclave sterilization. 23. Defendants provide infectious waste treatment services to New York City Metropolitan Area customers using local transfer stations. Other infectious waste treatment service providers that operate treatment facilities more than 100 miles from the New York City Metropolitan Area cannot costeffectively compete to provide infectious waste treatment services without a local transfer station located in the New York City Metropolitan Area. 24. A small but significant increase in the price of infectious waste treatment services would not cause New York City Metropolitan Area customers to move sufficient volumes of infectious waste to another type of treatment service or to switch to an infectious waste treatment service provider that does not operate a local transfer station in sufficient numbers so as to make such a price increase unprofitable. Therefore, the relevant market is the provision of infectious waste treatment services to customers in the New York Metropolitan Area. C. Anticompetitive Effect of the Acquisition 25. In the New York City Metropolitan Area, the acquisition would remove a significant competitor in the treatment of infectious waste in an already highly concentrated market. The proposed acquisition would reduce from three to two the number of competitors with local transfer stations, and Stericycle and HWS would have approximately 90 percent of the infectious waste treatment market in the New York City Metropolitan Area. The third competitor is a small firm that opened an autoclave treatment facility in Mount Vernon, New York in 2010; it is unlikely to replace the competition lost as a result of the merger. The substantial increase in concentration and loss of competition likely will result in higher prices for infectious waste treatment services. 26. Vigorous price competition between Stericycle and HWS in the provision of infectious waste treatment services has benefited customers in the New York City Metropolitan Area. 27. The proposed acquisition will eliminate the competition between Stericycle and HWS; reduce the number of providers of infectious waste treatment services with local transfer stations from three to two; and enable Stericycle to raise prices and lower quality of service for customers in the New York City Metropolitan Area, in PO 00000 Frm 00069 Fmt 4703 Sfmt 4703 violation of Section 7 of the Clayton Act. D. Entry Into the Treatment of Infectious Waste 28. Successful entry into the provision of infectious waste treatment services for customers in the New York City Metropolitan Area is unlikely without first obtaining a local transfer station from which waste can be transferred to more distant treatment facilities. 29. A prospective provider of infectious waste treatment services faces substantial barriers to site and build a transfer station. Obtaining the state and local permits and approvals necessary to site a medical waste transfer station would require a substantial investment in time and money, without any guarantee that the permits and approvals would ultimately be granted. In recent years, several infectious waste treatment service providers have attempted without success to obtain the necessary permits to site a local transfer station within New York City. 30. Entry into the provision of infectious waste treatment services to customers in the New York City Metropolitan Area would not be timely, likely, or sufficient to counter anticompetitive price increases or diminished quality of service that Stericycle could impose after the proposed acquisition. V. Violation Alleged 31. Stericycle’s proposed acquisition of HWS’s infectious waste treatment assets in the New York City Metropolitan Area likely will 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. 32. Unless restrained, the transaction will have the following anticompetitive effects, among others: A. Actual and potential competition between Stericycle and HWS in the provision of infectious waste treatment services in the New York City Metropolitan Area will be eliminated; b. Competition generally in the provision of infectious waste treatment services in the New York City Metropolitan Area will be substantially lessened; and c. Prices for infectious waste treatment services in the New York City Metropolitan Area likely will increase, and service likely will be reduced. VI. Requested Relief 33. Plaintiffs request: E:\FR\FM\14APN1.SGM 14APN1 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices a. That Stericycle’s proposed acquisition of HWS be adjudged and decreed to be unlawful and in violation of Section 7 of the Clayton Act, 15 U.S.C. 18; b. That defendants and all persons acting on their behalf be permanently enjoined and restrained from consummating the proposed acquisition of HWS by Stericycle, or from entering into or carrying out any contract, agreement, plan, or understanding, the effect of which would be to merge the voting securities or assets of the defendants; c. That plaintiffs receive such other and further relief as the case requires and the Court deems just and proper; and d. That plaintiffs recover the costs of this action. 120 Broadway, New York, New York 10271. Tel.: (212) 416–8280 Tel.: (212) 416–6195 Fax: (212) 416–6015 E-mail: Richard.Grimm@ag.ny.gov E-mail: Amy.McFarlane@ag.ny.gov United States District Court for the District of Columbia United States of America and State of New York, Plaintiffs, v. Stericycle, Inc., SAMW Acquisition Corporation, and Healthcare Waste Solutions, Inc., Defendants. Case No.: 1:11–cv–00689 Assigned To: Howell, Beryl A. Assign. Date: 4/8/2011 Description: Antitrust mstockstill on DSKH9S0YB1PROD with NOTICES Competitive Impact Statement Plaintiff United States of America (‘‘United States’’), pursuant to Section 2(b) of the Antitrust Procedures and Dated: April 8, 2011. Penalties Act (‘‘APPA’’ or ‘‘Tunney Act’’), Respectfully submitted, 15 U.S.C. 16(b)–(h), files this For Plaintiff United States of America Competitive Impact Statement relating /s/ lllllllllllllllllll to the proposed Final Judgment Christine A. Varney, submitted for entry in this civil antitrust Assistant Attorney General. proceeding. /s/ lllllllllllllllllll Maribeth Petrizzi, Chief, Litigation II Section, DC Bar # 435204. /s/ lllllllllllllllllll Dorothy B. Fountain, Assistant Chief, Litigation II Section. /s/ lllllllllllllllllll Sharis A. Pozen, Deputy Assistant Attorney General, DC Bar # 439469. /s/ lllllllllllllllllll Katherine B. Forrest, Deputy Assistant Attorney General. /s/ lllllllllllllllllll Patricia A. Brink, Director of Civil Enforcement. /s/ lllllllllllllllllll Lowell R. Stern (DC Bar #440387), Stephen A. Harris, Blake W. Rushforth, Milosz K. Gudzowski, Attorneys, U.S. Department of Justice, Antitrust Division, Litigation II Section, 450 Fifth Street, NW, Suite 8700, Washington, DC 20530. Tel.: (202) 514–3676 Fax: (202) 514–9033 E-mail: Lowell.Stern@usdoj.gov For Plaintiff State of New York, Eric T. Schneiderman, Attorney General. By: /s/ lllllllllllllllllll Richard L. Schwartz, Acting Chief, Antitrust Bureau. /s/ lllllllllllllllllll Richard E. Grimm, Assistant Attorney General. /s/ lllllllllllllllllll Amy E. McFarlane, Assistant Attorney General. Office of the Attorney General, Antitrust Bureau, VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 I. Nature and Purpose of the Proceeding Defendant Stericycle, Inc., through SAMW Acquisition Corporation, and defendant Healthcare Waste Solutions, Inc. (‘‘HWS’’), entered into a merger agreement dated September 24, 2010, pursuant to which Stericycle would acquire all of HWS, except for an incinerator in Matthews, North Carolina, for $245 million. The United States and the State of New York filed a civil antitrust Complaint on April 8, 2011, seeking to enjoin the proposed acquisition, alleging that it likely would substantially lessen competition in the provision of infectious waste treatment services to customers in the New York City Metropolitan Area, in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. The loss of competition from the acquisition likely would result in higher prices and reduced service for these customers of infectious waste treatment services. At the same time the Complaint was filed, the United States and the State of New York also filed a Hold Separate Stipulation and Order and proposed Final Judgment, which are designed to eliminate the anticompetitive effects that would result from Stericycle’s acquisition of HWS. Under the proposed Final Judgment, which is explained more fully below, Stericycle is required to divest HWS’s transfer station located in the Bronx, New York. Under the terms of the Hold Separate Stipulation and Order, Stericycle and HWS must take certain steps to ensure that the PO 00000 Frm 00070 Fmt 4703 Sfmt 4703 21009 assets being divested continue to be operated in a competitively independent and economically viable manner and that competition for infectious waste treatment services is maintained during the pendency of the ordered divestiture. The United States, the State of New York, and the 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 Final Judgment and to punish violations thereof. II. Description of the Events Giving Rise to the Alleged Violation A. The Defendants Stericycle is a Delaware corporation with its principal place of business in Lake Forest, Illinois. Stericycle, a multinational company, is the largest provider of infectious waste treatment services in the United States, with operations in all 50 states, including 54 treatment facilities. In 2009, Stericycle had U.S. revenues of $913 million. SAMW Acquisition Corporation is a corporation formed by Stericycle to facilitate its acquisition of HWS. HWS is a Delaware corporation with its principal place of business in Cincinnati, Ohio. HWS is the secondlargest provider of infectious waste treatment services in the United States, with operations in 15 states that include six treatment facilities. In 2009, HWS had total revenues of about $31 million. B. The Competitive Effect of the Acquisition on Infectious Waste Treatment Services 1. Background Regulated medical waste is waste generated in the diagnosis, treatment, or immunization of human beings or animals. There are generally three types of regulated medical waste: (1) Infectious waste; (2) pathological waste; and (3) trace chemotherapy waste. Infectious waste is waste that has come into contact with bodily fluids and ‘‘sharps’’ waste, such as syringes and scalpels. Pathological waste is anatomical parts, and trace chemotherapy waste is small amounts of chemical compounds used to treat cancer patients and the equipment used to administer the compounds. Infectious waste comprises approximately 90 percent of the regulated medical waste generated in the United States. State and federal governments heavily regulate the treatment of regulated E:\FR\FM\14APN1.SGM 14APN1 mstockstill on DSKH9S0YB1PROD with NOTICES 21010 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices medical waste. They prescribe how each type of regulated medical waste must be stored, collected, and treated. Providers of infectious waste treatment services are required to be licensed by various state and federal regulatory agencies before they can offer such services. Regulated medical waste must be stored separately from other types of waste, and each type of regulated medical waste must be stored separately from the other types in specially marked and sealed containers. State-approved treatment facilities must be used to render infectious waste non-infectious. Failure to use state-approved treatment facilities subjects both the generator of the infectious waste and the infectious waste treatment service provider to criminal prosecution, fines, damage actions, and potentially high clean-up costs. Autoclave sterilization is the most common treatment for infectious waste. An autoclave uses steam sterilization combined with pressure to render infectious waste non-infectious. Autoclave sterilization is not approved for pathological or trace chemotherapy waste, which instead must be incinerated in a specially licensed medical waste incinerator. Infectious waste is typically collected from generator sites (e.g., hospitals and physician offices) on daily route trucks and then transported to treatment facilities. Route trucks are vans and, more typically, 16- to 24-foot straight trucks. A daily route truck typically travels a route within a 75- to 100-mile radius of its garage. Obtaining approval for an infectious waste treatment facility in and around large urban areas, such as New York City, is difficult. Only one such commercial facility operates in the New York City Metropolitan Area. Transporting large volumes of infectious waste to distant treatment facilities using daily route trucks is not costeffective. Therefore, service providers serve such areas by using local transfer stations. Once the daily route truck has delivered the infectious waste to a local transfer station, the collection function is completed. At a transfer station, containers of infectious waste are unloaded from the daily route trucks and loaded onto tractor trailers for efficient shipment to more distant treatment facilities. The size of the market for the provision of infectious waste treatment services is largely influenced by transportation costs because such costs represent a large share of the total cost of providing treatment services. Defendants Stericycle and HWS own and operate numerous autoclave VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 facilities for the treatment of infectious waste. Stericycle’s and HWS’s closest facilities to New York City are located in Sheridan and Oneonta, New York; Woonsocket, Rhode Island; and Morgantown and Marcus Hook, Pennsylvania. The closest of these is about 180 miles from New York City. It is not cost-effective to transport large volumes of infectious waste to these distant facilities using daily route trucks. Stericycle and HWS operate local transfer stations in and around New York City and compete to provide infectious waste treatment services by serving customers through these local transfer stations. In and around New York City, Stericycle owns and operates local transfer stations in the Bronx, Staten Island, West Babylon, and Farmingdale, New York. Stericycle also owns local transfer stations in Piscataway and Bloomfield, New Jersey. HWS owns and operates a local transfer station in the Bronx, New York. In the New York City Metropolitan Area, encompassing the City of New York, and the counties of Westchester, Rockland, Nassau, and Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, Union, and Middlesex in New Jersey, and the county of Fairfield in Connecticut, apart from one small competitor, no other infectious waste treatment service provider has a local transfer station located within approximately 100 miles of Stericycle’s or HWS’s local transfer stations. 2. Relevant Market The provision of infectious waste treatment services to customers in the New York City Metropolitan Area is a line of commerce and relevant price discrimination service market within the meaning of Section 7 of the Clayton Act. Infectious waste treatment differs from treatment for other types of waste, including other types of regulated medical waste. There are no legal alternatives to treating infectious waste other than using an approved treatment technology, such as autoclave sterilization. Defendants provide infectious waste treatment services to New York City Metropolitan Area customers using local transfer stations. Other infectious waste treatment service providers that operate treatment facilities more than 100 miles from the New York City Metropolitan Area cannot cost-effectively compete to provide infectious waste treatment services without a local transfer station located in the New York City Metropolitan Area. A small but significant increase in the price of infectious waste treatment services PO 00000 Frm 00071 Fmt 4703 Sfmt 4703 would not cause New York City Metropolitan Area customers to move sufficient volumes of infectious waste to another type of treatment service, or to switch to an infectious waste treatment service provider that does not operate a local transfer station, in sufficient numbers so as to make such a price increase unprofitable. The relevant market is the provision of infectious waste treatment services to customers in the New York City Metropolitan Area. 3. Anticompetitive Effects of the Transaction In the New York City Metropolitan Area, the acquisition would remove a significant competitor in the treatment of infectious waste in an already highly concentrated market. The proposed acquisition would reduce from three to two the number of competitors with local transfer stations, and Stericycle and HWS would have approximately 90 percent of the infectious waste treatment market in the New York City Metropolitan Area. Vigorous price competition between Stericycle and HWS in the provision of infectious waste treatment services has benefited customers in the New York City Metropolitan Area. The third competitor is a small firm that opened an autoclave treatment facility in Mount Vernon, New York, in 2010; it is unlikely to replace the competition lost as a result of the merger. The proposed acquisition will eliminate the competition between Stericycle and HWS and enable Stericycle to raise prices and lower quality of service for customers in the New York City Metropolitan Area, in violation of Section 7 of the Clayton Act. 4. Entry Into the Treatment of Infectious Waste Successful entry into the provision of infectious waste treatment services for customers in the New York City Metropolitan Area is unlikely without first obtaining a local transfer station from which waste can be transferred to more distant treatment facilities. A prospective provider of infectious waste treatment services faces substantial barriers to site and build a transfer station. Obtaining the state and local permits and approvals necessary to site an infectious waste transfer station would require a substantial investment in time and money, without any guarantee that the permits and approvals would ultimately be granted. In recent years, several infectious waste treatment service providers have attempted without success to obtain the E:\FR\FM\14APN1.SGM 14APN1 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES necessary permits to site a local transfer station within New York City. Entry into the provision of infectious waste treatment services to customers in the New York City Metropolitan Area would not be timely, likely, or sufficient to counter anticompetitive price increases or diminished quality of service that Stericycle could impose after the proposed acquisition. III. Explanation of the Proposed Final Judgment The terms of the proposed Final Judgment will eliminate the anticompetitive effects of the acquisition alleged in the Complaint. Section IV of the proposed Final Judgment requires defendants, within forty-five (45) 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 HWS’s transfer station in the Bronx, New York, which is used in the provision of infectious waste treatment services to customers in the New York City Metropolitan Area. The acquirer of the transfer station, along with associated tangible and intangible assets, must be acceptable to the United States, in its sole discretion after consultation with the State of New York. The divestiture of these assets according to the terms of the proposed Final Judgment will establish a new, independent, and economically viable competitor, thereby preserving competition in the provision of infectious waste treatment services to customers in the New York City Metropolitan Area. In the event that defendants do not accomplish the divestiture within the time prescribed in the proposed Final Judgment, the proposed Final Judgment provides that the Court will appoint a trustee selected by the United States to effect the divestitures. 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 divestitures are accomplished. After his or her appointment becomes effective, the trustee will file monthly reports with the Court, United States, and the State of New York as appropriate, setting forth his or her efforts to accomplish the divestitures. At the end of six months, if the divestitures have not been accomplished, the trustee, the United States, and the State of New York, will make recommendations to the Court, which shall enter such orders as appropriate in order to carry out the VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 purpose of the trust, including extending the trust or the term of the trustee’s appointment. The Final Judgment also requires, in Section VIII, that defendants provide advance notification of certain future proposed acquisitions not otherwise subject to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, 15 U.S.C. 18a. That provision requires 30 days’ advance written notice to the United States and the State of New York before defendants acquire, directly or indirectly, (1) Interest in any business engaged in the treatment of infectious waste that serves the New York City Metropolitan Area; (2) other than in the ordinary course of business, assets of a person engaged in the treatment of infectious waste generated in the New York City Metropolitan Area; or (3) capital stock or voting securities of any person that, at any time during the twelve (12) months immediately preceding such acquisition, was engaged in the treatment of infectious waste generated in the New York City Metropolitan Area, where that person’s annual revenues in this area from the treatment of infectious waste were in excess of $500,000. With this provision, the United States and the State of New York will have knowledge in advance of acquisitions that may impact competition in the provision of infectious waste treatment services in the New York City Metropolitan Area. 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 the defendants. V. Procedures Available for Modification of the Proposed Final Judgment The United States, the State of New York, and the defendants have stipulated that the proposed Final Judgment may be entered by the Court after compliance with the provisions of the APPA, provided that the United States has not withdrawn its consent. The APPA conditions entry upon the PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 21011 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 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, 450 Fifth Street, NW., Suite 8700, 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 commenced litigation and sought a judicial order enjoining the acquisition of HWS by Stericycle. The United States is satisfied that the divestiture and other relief described in the proposed Final Judgment will preserve competition in the provision of infectious waste treatment services for customers in the New York City Metropolitan Area. The relief contained in the proposed Final Judgment would achieve all or substantially all of the relief that the United States would have obtained through litigation, while avoiding the time, expense, and uncertainty of a full trial on the merits of the Complaint. 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 E:\FR\FM\14APN1.SGM 14APN1 21012 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices the United States be subject to a sixtyday 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)(1). In making that determination, the court, in accordance with the statute as amended in 2004, is required to consider: mstockstill on DSKH9S0YB1PROD with NOTICES (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 (DC Cir. 1995); see generally United States v. SBC Commc’ns, Inc., 489 F. Supp. 2d 1 (D.DC 2007) (assessing public interest standard under the Tunney Act); United States v. InBev N.V./S.A., 2009–2 Trade Cas. (CCH) ¶ 76,736, 2009 U.S. Dist. LEXIS 84787, No. 08–1965 (JR), at *3, (D.DC Aug. 11, 2009) (noting that the court’s review of a consent judgment is limited and only inquires ‘‘into whether the government’s determination that the proposed remedies will cure the antitrust violations alleged in the complaint was reasonable, and whether the mechanisms to enforce the final judgment are clear and manageable’’). As the United States Court of Appeals for the District of Columbia has held, under the APPA, a court considers, among other things, the relationship between the remedy secured and the 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., VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 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); InBev, 2009 U.S. Dist. LEXIS 84787, at *3. 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).1 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–Daniels– Midland Co., 272 F. Supp. 2d 1, 6 (D.DC 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); United States v. Republic Serv., Inc., 2010–2 Trade Cas. (CCH) ¶ 77,097, 2010 U.S. Dist. LEXIS 70895, No. 08–2076 (RWR), at *160 (D.D.C. July 15, 2010) (finding that ‘‘[i]n light of the deferential review to which the government’s proposed remedy is accorded, [amicus curiae’s] argument that an alternative remedy may be comparably superior, even if true, is not a sufficient basis for finding that the proposed final judgment is not in the public interest.’’). Courts have greater flexibility in approving proposed consent decrees than in crafting their own decrees 1 Cf. 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’ ’’). PO 00000 Frm 00073 Fmt 4703 Sfmt 4703 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. 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). Therefore, the United States ‘‘need only provide a factual basis for concluding that the settlements are reasonably adequate remedies for the alleged harms.’’ SBC Commc’ns, 489 F. Supp. 2d at 17; Republic Serv., 2010 U.S. Dist. LEXIS 70895, at *158 (entering final judgment ‘‘[b]ecause there is an adequate factual foundation upon which to conclude that the government’s proposed divestitures will remedy the antitrust violations alleged in the complaint.’’). 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; see also InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (‘‘the ‘public interest’ is not to be measured by comparing the violations alleged in the complaint against those the court believes could have, or even should have, been alleged’’). 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. Microsoft, 56 F.3d at 1459–60. As this Court 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.’’ 489 F. Supp. 2d at 15. In its 2004 amendments to the Tunney Act,2 Congress made clear its 2 The 2004 amendments substituted the word ‘‘shall’’ for ‘‘may’’ when directing the courts to consider the enumerated factors and amended the E:\FR\FM\14APN1.SGM 14APN1 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices 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 wrote 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 11.3 United States District Court for the District of Columbia United States of America and State of New York, Plaintiffs, v. Stericycle, Inc., SAMW Acquisition Corp., and Healthcare Waste Solutions, Inc., Defendants. Case No.: Judge: Deck Type: Antitrust Date Stamp: mstockstill on DSKH9S0YB1PROD with NOTICES Proposed Final Judgment Whereas, plaintiffs, the United States of America and the State of New York, filed their Complaint on April ___, 2011; plaintiffs and defendants, Stericycle, Inc. and SAMW Acquisition Corp., and Healthcare Waste Solutions, Inc., 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 VIII. Determinative Documents Court; And whereas, the essence of this Final There are no determinative materials or documents within the meaning of the Judgment is the prompt and certain divestiture of the Divestiture Asset to APPA that were considered by the assure that competition is not United States in formulating the substantially lessened; proposed Final Judgment. And Whereas, plaintiffs require Dated: April 8, 2011. defendants to make a divestiture for the purpose of remedying the loss of Respectfully submitted, /s/ lllllllllllllllllll competition alleged in the Complaint; And whereas, defendants have Lowell R. Stern (DC Bar #440487), represented to plaintiffs that the U.S. Department of Justice, Antitrust divestiture required below can and will Division, Litigation II Section, 450 Fifth be made, and that defendants will later Street, NW., Suite 8700, Washington, DC raise no claim of hardship or difficulty 20530. as grounds for asking the Court to Tel.: (202) 514–3676, modify any of the divestiture provisions E-mail: lowell.stern@usdoj.gov. contained below; Now, therefore, before any testimony list of factors to focus on competitive considerations is taken, without trial or adjudication of and address potentially ambiguous judgment terms. any issue of fact or law, and upon Compare 15 U.S.C. 16(e) (2004), with 15 U.S.C. consent of the parties, it is hereby 16(e)(1) (2006); see also SBC Commc’ns, 489 F. Supp. 2d at 11 (concluding that the 2004 ordered, adjudged, and decreed: amendments ‘‘effected minimal changes’’ to Tunney Act review). 3 See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 (D.DC 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.’’). VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 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, 15 U.S.C. 18, as amended. II. Definitions As used in this Final Judgment: A. ‘‘Acquirer’’ means the entity to which defendants shall divest the Divestiture Asset. B. ‘‘Stericycle’’ means defendant Stericycle, Inc., a Delaware corporation with its principal place of business in PO 00000 Frm 00074 Fmt 4703 Sfmt 4703 21013 Lake Forest, Illinois, and SAMW Acquisition Corp. (a corporation formed to facilitate the acquisition), and their successors, assigns, subsidiaries, divisions, groups, affiliates, partnerships, and joint ventures, and all of their directors, officers, managers, agents, and employees. C. ‘‘HWS’’ means defendant Healthcare Waste Solutions, Inc., a Delaware corporation with its principal place of business in Cincinnati, Ohio, and its successors, assigns, subsidiaries, divisions, groups, affiliates, partnerships, and joint ventures, and all of their directors, officers, managers, agents, and employees. D. ‘‘Infectious Waste’’ means regulated medical waste that is generated in the diagnosis, treatment, or immunization of human beings or animals and that has come into contact with bodily fluids, and ‘‘sharps’’ waste, such as syringes and scalpels. E. ‘‘Treatment’’ means the sterilization of infectious waste at a state-approved treatment facility, including the use of transfer stations to facilitate the shipment of infectious waste to other treatment sites. F. ‘‘Divestiture Asset’’ means HWS’s Bronx, New York transfer station, located at 1281 Viele Avenue, Bronx, New York 10474, including: 1. Tangible assets at the HWS facility identified in this Paragraph II(F), including all research and development activities, equipment, and fixed assets, real property (leased or owned), equipment, personal property, inventory, office furniture, materials, supplies, on- or off-site warehouses or storage facilities; all licenses, permits, and authorizations issued by any governmental organization relating to the facilities; and all facility records, but excluding assets used exclusively in the HWS collection business; and 2. All intangible assets associated with the HWS facility identified in this Paragraph II(F), including, but not limited to, all contractual rights, patents, licenses and sublicenses, intellectual property, technical information, computer software (including waste monitoring software and management information systems) and related documentation, 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 provided to employees, customers, suppliers, agents or licensees, but excluding assets used exclusively in the HWS collection business. G. ‘‘New York City Metropolitan Area’’ means the area encompassing the City of New York, and the counties of Westchester, Rockland, Nassau, and E:\FR\FM\14APN1.SGM 14APN1 21014 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, Union, and Middlesex in New Jersey, and the county of Fairfield in Connecticut. mstockstill on DSKH9S0YB1PROD with NOTICES III. Applicability A. This Final Judgment applies to Stericycle and HWS, as defined above, and all other persons in active concert or participation with either of them, who receive actual notice of this Final Judgment by personal service or otherwise. B. 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 Asset, 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. Divestiture A. Defendants are ordered and directed, within forty-five (45) 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 Asset in a manner consistent with this Final Judgment to an Acquirer acceptable to the United States in its sole discretion, after consultation with the State of New York. The United States, in its sole discretion, after consultation with the State of New York, may agree to one or more extensions of this time period not to exceed thirty (30) calendar days in total, and shall notify the Court in such circumstances. Defendants agree to use their best efforts to divest the Divestiture Asset 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 Asset. Defendants shall inform any person making an inquiry regarding a possible purchase of the Divestiture Asset that it is 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 Asset customarily provided in a due diligence process except such information or documents subject to the attorney-client privilege or work-product doctrine. Defendants shall make available such information to the United States at the same time that such VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 information is made available to any other person. C. Defendants shall provide the Acquirer and the United States information relating to the personnel involved in the operation and management of the Divestiture Asset to enable the Acquirer to make offers of employment. Defendants shall not interfere with any negotiations by the Acquirer to employ or contract with any defendant employee whose primary responsibility is the operation or management of the Divestiture Asset. D. Defendants shall permit prospective Acquirers of the Divestiture Asset to have reasonable access to personnel and to make inspections of the physical facility of the Divestiture Asset; 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 the Divestiture 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 Asset. G. Defendants shall warrant to the Acquirer that there are no material defects in the environmental, zoning or other permits pertaining to the operation of the Divestiture Asset, and that following the sale of the Divestiture Asset, defendants will not undertake, directly or indirectly, any challenges to the environmental, zoning, or other permits relating to the operation of the Divestiture Asset. H. Unless the United States, after consultation with the State of New York, otherwise consents in writing, the divestiture pursuant to Section IV, or by trustee appointed pursuant to Section V, of this Final Judgment, shall be accomplished in such a way as to satisfy the United States, in its sole discretion, after consultation with the State of New York, that the divestiture will achieve the purposes of this Final Judgment and that the Divestiture Asset can and will be used by the Acquirer as part of a viable, ongoing business providing infectious waste treatment services. The divestiture, whether pursuant to Section IV or Section V of this Final Judgment: 1. Shall be made to the Acquirer that, in the United States’s sole judgment, after consultation with the State of New York, has the intent and capability (including the necessary managerial, operational, technical and financial capability) of competing effectively in the business of providing infectious waste treatment services; and PO 00000 Frm 00075 Fmt 4703 Sfmt 4703 2. Shall be accomplished so as to satisfy the United States, in its sole discretion, after consultation with the State of New York, that none of the terms of any agreement between the Acquirer and defendants gives defendants the ability unreasonably to raise the Acquirer’s costs, to lower the Acquirer’s efficiency, or otherwise to interfere in the ability of the Acquirer to compete effectively. V. Appointment of Trustee A. If defendants have not divested the Divestiture Asset within the time period specified in Section IV, 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 sale of the Divestiture Asset. B. After the appointment of a trustee becomes effective, only the trustee shall have the right to sell the Divestiture Asset. The trustee shall have the power and authority to accomplish the divestiture to an Acquirer acceptable to the United States, after consultation with the State of New York, 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 defendants’ cost and expense any investment bankers, attorneys, or other agents, who shall be solely accountable to the trustee, reasonably necessary in the trustee’s judgment to assist in the divestiture. C. Defendants shall not object to a sale by the trustee on any ground other than the trustee’s malfeasance. Any such objections by defendants must be conveyed in writing to the United States and the trustee within ten (10) calendar days after the trustee has provided the notice required under Section VI. D. The trustee shall serve at the cost and expense of defendants, on such terms and conditions as the United States approves, and shall account for all monies derived from the sale of the Divestiture Asset 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 Asset and based on a fee arrangement providing the trustee with an incentive based on the price and terms of the divestiture and E:\FR\FM\14APN1.SGM 14APN1 mstockstill on DSKH9S0YB1PROD with NOTICES Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices 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 facility of the Divestiture Asset, and defendants shall develop financial and other information relevant to the Divestiture Asset 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 State of New York, 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 Asset, 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 Asset. 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 VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 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 plaintiffs 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 Asset, together with full details of the same. B. Within ten (10) calendar days of receipt of such notice by the plaintiffs, 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 ten (10) calendar days of the receipt of the request, unless the parties shall otherwise agree. C. Within fifteen (15) calendar days after receipt of the notice or within fifteen (15) 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, after consultation with the State of New York, 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 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. PO 00000 Frm 00076 Fmt 4703 Sfmt 4703 21015 VII. Notice to Customers No later than five (5) calendar days following the sale of the Divestiture Asset, Defendants shall send a Notice, in a form approved by the United States, in its sole discretion, after consultation with the State of New York, to all customers located in the New York City Metropolitan Area that are under contract with HWS and served by the Divestiture Asset, informing such customers that they have the right to terminate such contracts for a period of ninety (90) days from the date of the Notice. Defendants shall certify to the United States that the Notice was timely sent. VIII. Notice of Future Acquisitions A. Unless such transaction is otherwise subject to the reporting and waiting period requirements of the HartScott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. 18a (the ‘‘HSR Act’’), Stericycle, without providing advance notification to the plaintiffs, shall not directly or indirectly acquire, any (1) Interest in any business engaged in the treatment of infectious waste that serves the New York City Metropolitan Area; (2) other than in the ordinary course of business assets of a person engaged in the treatment of infectious waste generated in the New York City Metropolitan Area; or (3) capital stock or voting securities of any person that, at any time during the twelve (12) months immediately preceding such acquisition, was engaged in the treatment of infectious waste generated in the New York City Metropolitan Area, where that person’s annual revenues in this area from the treatment of infectious waste were in excess of $500,000. B. Such notification shall be provided to the plaintiffs in the same format as, and per the instructions relating to the Notification and Report Form set forth in the Appendix to Part 803 of Title 16 of the Code of Federal Regulations as amended, except that the information requested in Items 5 through 9 of the instructions must be provided only about the treatment of infectious waste. Notification shall be provided at least thirty (30) calendar days prior to acquiring any such interest, and shall include, beyond what may be required by the applicable instructions, the names of the principal representatives of the parties to the agreement who negotiated the agreement, and any management or strategic plans discussing the proposed transaction. If within the 30-day period after notification, representatives of the United States make a written request for E:\FR\FM\14APN1.SGM 14APN1 21016 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices additional information, Stericycle shall not consummate the proposed transaction or agreement until thirty (30) calendar days after submitting all such additional information. Early termination of the waiting periods in this paragraph may be requested and, where appropriate, granted in the same manner as is applicable under the requirements and provisions of the HSR Act and rules promulgated thereunder. This Section shall be broadly construed and any ambiguity or uncertainty regarding the filing of notice under this Section shall be resolved in favor of filing notice. IX. Financing Defendants shall not finance all or any part of any purchase made pursuant to Section IV or V of this Final Judgment. mstockstill on DSKH9S0YB1PROD with NOTICES X. 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. XI. 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 plaintiffs 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 Asset, 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 Asset, 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, after consultation with the State of New York, to information provided by defendants, including limitation on information, shall be made within fourteen (14) calendar days of receipt of such affidavit. VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 B. Within twenty (20) calendar days of the filing of the Complaint in this matter, defendants shall deliver to plaintiffs 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 IX of this Final Judgment. Defendants shall deliver to the plaintiffs 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 Asset until one year after such divestiture has been completed. XII. 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, 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, 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 or the New York Attorney General, except in the course of legal proceedings to PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 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). XIII. No Reacquisition During the term of this Final Judgment, defendants may not reacquire any part of the Divestiture Asset, nor may any defendant participate in any other transaction that would result in a combination, merger, or other joining together of any part of the Divestiture Asset with assets of the divesting company. XIV. 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. XV. Expiration of Final Judgment Unless this Court grants an extension, this Final Judgment shall expire ten (10) years from the date of its entry. XVI. 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: llllllllllllllllll E:\FR\FM\14APN1.SGM 14APN1 Federal Register / Vol. 76, No. 72 / Thursday, April 14, 2011 / Notices Court approval subject to procedures of NW., Suite 7100, Washington, DC 20530 Antitrust Procedures and Penalties Act, 15 (telephone: 202–307–6200). U.S.C. 16. Patricia A. Brink, United States District Judge. lllllll Director of Civil Enforcement. [FR Doc. 2011–9106 Filed 4–13–11; 8:45 am] In the United States District Court for the District of Columbia BILLING CODE 4410–11–P United States of America, United States Department of Justice, Antitrust Division, 450 Fifth Street, NW., Suite 7100, Washington, DC 20530, Plaintiff, v. Google Inc., 1600 Amphitheatre Parkway, Mountain View, CA 94043, and ITA Software, Inc., 141 Portland Street, Cambridge, MA 02139, Defendants. Civil Action No. 1:11–cv–00688. Filed: 4/8/2011. DEPARTMENT OF JUSTICE Antitrust Division mstockstill on DSKH9S0YB1PROD with NOTICES United States v. Google Inc. and ITA Software Inc., 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 of America v. Google Inc. and ITA Software Inc., Civil Case No. 1:11–cv–00688. On April 8, 2011, the United States filed a Complaint alleging that Google’s proposed acquisition of ITA Software Inc. would substantially reduce competition in the online travel planning industry, in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. The proposed Final Judgment would require Google to continue licensing ITA Software’s products for a period of five years following the merger. Copies of the Complaint, proposed Final Judgment 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 https:// www.justice.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 James J. Tierney, Chief, Networks and Technology Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, VerDate Mar<15>2010 18:34 Apr 13, 2011 Jkt 223001 Complaint The United States of America, acting under the direction of the Attorney General of the United States, brings this civil action against Google Inc. (‘‘Google’’) and ITA Software, Inc. (‘‘ITA’’) pursuant to the antitrust laws of the United States to enjoin Google’s proposed acquisition of ITA, and to obtain such other equitable relief as the Court deems appropriate. The United States alleges as follows: I. Nature of Action 1. On July 1, 2010, Google, a significant provider of general Internet search and search advertising in the United States, entered into a merger agreement to acquire ITA, the provider of the leading independent airfare pricing and shopping system (‘‘P&S system’’), for $700 million. P&S systems provide flight pricing, schedule and seat availability information to Internet travel sites. 2. Online travel represents a significant share of e-commerce in the United States. Consumers rely on the Internet to make their travel plans, and often begin by shopping for airfare. Online travel intermediaries (‘‘OTIs’’) such as Orbitz, Kayak and Expedia allow consumers to compare flight prices, schedules, and seat availability on multiple airlines simultaneously. OTIs, and the flight search services they offer, have become very popular with consumers who want to ensure they are getting the best deal. Indeed, most U.S. consumers compare flight options on an OTI Web site before purchasing a ticket online. 3. ITA’s P&S system, QPX, powers a significant share of the domestic comparative flight searches conducted by U.S. consumers. ITA licenses QPX to many of the most popular and innovative OTI’s providing comparative flight search services, including Orbitz, Kayak, and Microsoft’s Bing Travel. QPX is a critical flight search tool for many of its licensees, as other P&S PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 21017 systems cannot match its speed and flexibility, and are not poised to do so in the near future. Thus, these OTIs currently have no adequate alternatives to QPX and will not have any following the merger. 4. Google has the most widely used general Internet search engine in the United States and is the leading seller of Internet search advertising. Google seeks to expand its search services by launching an Internet travel site to offer comparative flight search services. 5. The proposed merger will give Google the means and incentive to use its ownership of QPX to foreclose or disadvantage its prospective flight search rivals by degrading their access to QPX, or denying them access to QPX altogether. As a result, the proposed merger is likely to result in reduced quality, variety, and innovation for consumers of comparative flight search services. II. Jurisdiction, Venue and Commerce 6. The United States brings this action under Section 15 of the Clayton Act, as amended, 15 U.S.C. 25, to prevent and restrain Google and ITA from violating Section 7 of the Clayton Act, as amended, 15 U.S.C. 18. 7. Google is a corporation organized and existing under the laws of the State of Delaware, with its principal place of business located in Mountain View, CA. In 2009, Google earned more than $23 billion in revenues in the United States. Google is engaged in interstate commerce and in activities substantially affecting interstate commerce. It sells online search advertising throughout the United States. Its sales of online search advertising in the United States represent a regular, continuous and substantial flow of interstate commerce, and have had a substantial effect upon interstate commerce. 8. ITA is a corporation organized and existing under the laws of the State of Delaware, with its principal place of business located in Cambridge, MA. ITA is engaged in interstate commerce and in activities substantially affecting interstate commerce. It makes sales throughout the United States. Its sales in the United States represent a regular, continuous and substantial flow of interstate commerce, and have had a substantial effect upon interstate commerce. 9. The Court has subject-matter jurisdiction over this action and these defendants pursuant to Section 15 of the Clayton Act, as amended, 15 U.S.C. 25, and 28 U.S.C. 1331, 1337(a), and 1345. 10. Venue is proper in this District under Section 12 of the Clayton Act, 15 U.S.C. 22, and 28 U.S.C. 1391(b)(1) and E:\FR\FM\14APN1.SGM 14APN1

Agencies

[Federal Register Volume 76, Number 72 (Thursday, April 14, 2011)]
[Notices]
[Pages 21006-21017]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-9106]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States and State of New York v. Stericycle, 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 and 
Competitive Impact Statement have been filed with the United States 
District Court for the District of Columbia in United States of America 
and State of New York v. Stericycle, Inc., et al., Civil Action No. 
1:11-cv-00689. On April 8, 2011, the United States and the attorney 
general for the State of New York filed a Complaint alleging that the 
proposed acquisition by Stericycle, Inc. of Healthcare Waste Solutions 
(``HWS'') would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The 
proposed Final Judgment, filed the same time as the Complaint, requires 
Stericycle and HWS to divest HWS's Bronx, New York transfer station, 
which is used in the provision of infectious waste treatment services 
for customers in the New York City metropolitan area.
    Copies of the Complaint, proposed Final Judgment, 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 https://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 a copying fee 
set by Department of Justice regulations.

[[Page 21007]]

    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, 
U.S. Department of Justice, 450 Fifth Street, NW., Suite 8700, 
Washington, DC 20530 (telephone: 202-307-0924).

Patricia A. Brink,
Director of Civil Enforcement.

United States District Court for the District of Columbia

    United States of America, Department of Justice, Antitrust 
Division, 450 Fifth Street, NW., Suite 8700, Washington, DC 20530, 
and State of New York, Office of the Attorney General, Antitrust 
Bureau, 120 Broadway, New York, New York 10271, Plaintiffs, v. 
Stericycle, Inc., 28161 North Keith Drive, Lake Forest, Illinois 
60045, SAMW Acquisition Corporation, 28161 North Keith Drive, Lake 
Forest, Illinois 60045, and Healthcare Waste Solutions, Inc., 4357 
Ferguson Drive, Suite 100, Cincinnati, Ohio 45245, Defendants.

Case No.: 1:11-cv-00689
Assigned To: Howell, Beryl A.
Assign. Date: 4/8/2011
Description: Antitrust

Complaint

    Plaintiffs, the United States of America (``United States''), 
acting under the direction of the Attorney General of the United 
States, and the State of New York, acting under the direction of its 
Attorney General, bring this civil antitrust action against defendants, 
Stericycle, Inc., SAMW Acquisition Corporation, and Healthcare Waste 
Services, Inc. (``HWS''), to enjoin Stericycle's proposed acquisition 
of HWS and to obtain other equitable relief. Plaintiffs complain and 
allege as follows:

I. Nature of the Action

    1. Pursuant to an agreement and plan of merger dated September 24, 
2010, Stericycle intends to acquire all of HWS, except for an 
incinerator in Matthews, North Carolina, for $245 million. Defendants 
Stericycle and HWS currently compete in the treatment of infectious 
waste.
    2. The United States and the State of New York bring this action to 
prevent the proposed acquisition because it would substantially lessen 
competition in the provision of infectious waste treatment services in 
the New York City Metropolitan Area, in violation of Section 7 of the 
Clayton Act, 15 U.S.C. 18.

II. Jurisdiction and Venue

    3. The United States brings this action under Section 15 of the 
Clayton Act, as amended, 15 U.S.C. 4 and 25, to prevent and restrain 
defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18. 
The State of New York brings this action under Section 16 of the 
Clayton Act, 15 U.S.C. 26, to prevent and restrain defendants from 
violating Section 7 of the Clayton Act, 15 U.S.C. 18. The State of New 
York, by and through its Attorney General, brings this action on behalf 
of the citizens, general welfare, and economy of the State of New York.
    4. Defendants treat infectious waste in the flow of interstate 
commerce. Defendants' activities in treating infectious waste 
substantially affect interstate commerce. The Court has jurisdiction 
over this action and over the parties pursuant to 15 U.S.C. 22 and 28 
U.S.C. 1331 and 1337.
    5. Defendants have consented to venue and personal jurisdiction in 
this District. Venue is therefore proper in this District under Section 
12 of the Clayton Act, 15 U.S.C. 22 and 28 U.S.C. 1391(c).

III. The Defendants

    6. Defendant Stericycle, Inc. is a Delaware corporation with its 
principal place of business in Lake Forest, Illinois. Stericycle, a 
multi-national company, is the largest provider of infectious waste 
treatment services in the United States, with operations in all 50 
states, including 54 treatment facilities. In 2009, Stericycle had U.S. 
revenues of $913 million. SAMW Acquisition Corporation is a corporation 
formed by Stericycle to facilitate its acquisition of HWS. Stericycle 
and SAMW hereinafter are collectively referred to as ``Stericycle''.
    7. Defendant Healthcare Waste Solutions (``HWS'') is a Delaware 
corporation with its principal place of business in Cincinnati, Ohio. 
HWS is the second-largest provider of infectious waste treatment 
services in the United States, with operations in 15 states that 
include six treatment facilities. In 2009, HWS had total revenue of 
about $31 million.

IV. Trade and Commerce

A. Background

    8. Regulated medical waste is waste generated in the diagnosis, 
treatment, or immunization of human beings or animals. There are 
generally three types of regulated medical waste: (1) Infectious waste; 
(2) pathological waste; and (3) trace chemotherapy waste. Infectious 
waste is waste that has come into contact with bodily fluids and 
``sharps'' waste, such as syringes and scalpels. Pathological waste is 
anatomical parts, and trace chemotherapy waste is small amounts of 
chemical compounds used to treat cancer patients and the equipment used 
to administer the compounds. Infectious waste comprises approximately 
90 percent of the regulated medical waste generated in the United 
States.
    9. State and federal governments heavily regulate the treatment of 
regulated medical waste. They prescribe how each type of regulated 
medical waste must be stored, collected, and treated. Providers of 
infectious waste treatment services are required to be licensed by 
various state and federal regulatory agencies before they can offer 
such services.
    10. Regulated medical waste must be stored separately from other 
types of waste, and each type of regulated medical waste must be stored 
separately from the other types in specially marked and sealed 
containers.
    11. State-approved treatment facilities must be used to render 
infectious waste non-infectious. Failure to use state-approved 
treatment facilities subjects both the generator of the infectious 
waste and the infectious waste treatment service provider to criminal 
prosecution, fines, damage actions, and potentially high clean-up 
costs.
    12. Autoclave sterilization is the most common treatment for 
infectious waste. An autoclave uses steam sterilization combined with 
pressure to render infectious waste non-infectious. Autoclave 
sterilization is not approved for pathological or trace chemotherapy 
waste, which instead must be incinerated in a specially licensed 
medical waste incinerator.
    13. Infectious waste is typically collected from generator sites 
(e.g., hospitals and physician offices) on daily route trucks and then 
transported to treatment facilities. Route trucks are vans and, more 
typically, 16- to 24-foot straight trucks. A daily route truck 
typically travels a route within a 75- to 100-mile radius of its 
garage.
    14. Obtaining approval for an infectious waste treatment facility 
in and around large urban areas, such as New York City, is difficult. 
Only one such commercial facility operates in the New York City 
Metropolitan area. Transporting large volumes of infectious waste to 
distant treatment facilities using daily route trucks is not cost-
effective. Therefore, service providers serve such areas by using local 
transfer stations.
    15. Once the daily route truck has delivered the infectious waste 
to a local

[[Page 21008]]

transfer station, the collection function is completed. At a transfer 
station, containers of infectious waste are unloaded from the daily 
route trucks and loaded onto tractor trailers for efficient shipment to 
more distant treatment facilities.
    16. The size of the market for the provision of infectious waste 
treatment services is largely influenced by transportation costs 
because such costs represent a large share of the total cost of 
providing treatment services.
    17. Defendants Stericycle and HWS own and operate numerous 
autoclave facilities for the treatment of infectious waste. 
Stericycle's and HWS's closest facilities to New York City are located 
in Sheridan and Oneonta, New York; Woonsocket, Rhode Island; and 
Morgantown and Marcus Hook, Pennsylvania. The closest of these is about 
180 miles from New York City. It is not cost-effective to transport 
large volumes of infectious waste to these distant facilities using 
daily route trucks.
    18. Stericycle and HWS operate local transfer stations in and 
around New York City and compete to provide infectious waste treatment 
services by serving customers through these local transfer stations.
    19. In and around New York City, Stericycle owns and operates local 
transfer stations in the Bronx, Staten Island, West Babylon, and 
Farmingdale, New York. Stericycle also owns local transfer stations in 
Piscataway and Bloomfield, New Jersey. HWS owns and operates a local 
transfer station in the Bronx, New York.
    20. In the New York City Metropolitan Area, encompassing the City 
of New York, and the counties of Westchester, Rockland, Nassau, and 
Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, 
Union, and Middlesex in New Jersey, and the county of Fairfield in 
Connecticut, apart from one small competitor, no other infectious waste 
treatment service provider has a local transfer station located within 
approximately 100 miles of Stericycle's or HWS's local transfer 
stations.

B. Relevant Market

    21. The provision of infectious waste treatment services to 
customers in the New York City Metropolitan Area is a line of commerce 
and relevant price discrimination service market within the meaning of 
Section 7 of the Clayton Act.
    22. Infectious waste treatment differs from treatment for other 
types of waste, including other types of regulated medical waste. There 
are no legal alternatives to treating infectious waste other than using 
an approved treatment technology, such as autoclave sterilization.
    23. Defendants provide infectious waste treatment services to New 
York City Metropolitan Area customers using local transfer stations. 
Other infectious waste treatment service providers that operate 
treatment facilities more than 100 miles from the New York City 
Metropolitan Area cannot cost-effectively compete to provide infectious 
waste treatment services without a local transfer station located in 
the New York City Metropolitan Area.
    24. A small but significant increase in the price of infectious 
waste treatment services would not cause New York City Metropolitan 
Area customers to move sufficient volumes of infectious waste to 
another type of treatment service or to switch to an infectious waste 
treatment service provider that does not operate a local transfer 
station in sufficient numbers so as to make such a price increase 
unprofitable. Therefore, the relevant market is the provision of 
infectious waste treatment services to customers in the New York 
Metropolitan Area.

C. Anticompetitive Effect of the Acquisition

    25. In the New York City Metropolitan Area, the acquisition would 
remove a significant competitor in the treatment of infectious waste in 
an already highly concentrated market. The proposed acquisition would 
reduce from three to two the number of competitors with local transfer 
stations, and Stericycle and HWS would have approximately 90 percent of 
the infectious waste treatment market in the New York City Metropolitan 
Area. The third competitor is a small firm that opened an autoclave 
treatment facility in Mount Vernon, New York in 2010; it is unlikely to 
replace the competition lost as a result of the merger. The substantial 
increase in concentration and loss of competition likely will result in 
higher prices for infectious waste treatment services.
    26. Vigorous price competition between Stericycle and HWS in the 
provision of infectious waste treatment services has benefited 
customers in the New York City Metropolitan Area.
    27. The proposed acquisition will eliminate the competition between 
Stericycle and HWS; reduce the number of providers of infectious waste 
treatment services with local transfer stations from three to two; and 
enable Stericycle to raise prices and lower quality of service for 
customers in the New York City Metropolitan Area, in violation of 
Section 7 of the Clayton Act.

D. Entry Into the Treatment of Infectious Waste

    28. Successful entry into the provision of infectious waste 
treatment services for customers in the New York City Metropolitan Area 
is unlikely without first obtaining a local transfer station from which 
waste can be transferred to more distant treatment facilities.
    29. A prospective provider of infectious waste treatment services 
faces substantial barriers to site and build a transfer station. 
Obtaining the state and local permits and approvals necessary to site a 
medical waste transfer station would require a substantial investment 
in time and money, without any guarantee that the permits and approvals 
would ultimately be granted. In recent years, several infectious waste 
treatment service providers have attempted without success to obtain 
the necessary permits to site a local transfer station within New York 
City.
    30. Entry into the provision of infectious waste treatment services 
to customers in the New York City Metropolitan Area would not be 
timely, likely, or sufficient to counter anticompetitive price 
increases or diminished quality of service that Stericycle could impose 
after the proposed acquisition.

V. Violation Alleged

    31. Stericycle's proposed acquisition of HWS's infectious waste 
treatment assets in the New York City Metropolitan Area likely will 
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.
    32. Unless restrained, the transaction will have the following 
anticompetitive effects, among others:
    A. Actual and potential competition between Stericycle and HWS in 
the provision of infectious waste treatment services in the New York 
City Metropolitan Area will be eliminated;
    b. Competition generally in the provision of infectious waste 
treatment services in the New York City Metropolitan Area will be 
substantially lessened; and
    c. Prices for infectious waste treatment services in the New York 
City Metropolitan Area likely will increase, and service likely will be 
reduced.

VI. Requested Relief

    33. Plaintiffs request:

[[Page 21009]]

    a. That Stericycle's proposed acquisition of HWS be adjudged and 
decreed to be unlawful and in violation of Section 7 of the Clayton 
Act, 15 U.S.C. 18;
    b. That defendants and all persons acting on their behalf be 
permanently enjoined and restrained from consummating the proposed 
acquisition of HWS by Stericycle, or from entering into or carrying out 
any contract, agreement, plan, or understanding, the effect of which 
would be to merge the voting securities or assets of the defendants;
    c. That plaintiffs receive such other and further relief as the 
case requires and the Court deems just and proper; and
    d. That plaintiffs recover the costs of this action.

Dated: April 8, 2011.

Respectfully submitted,

For Plaintiff United States of America

/s/--------------------------------------------------------------------
Christine A. Varney,
Assistant Attorney General.

/s/--------------------------------------------------------------------
Maribeth Petrizzi,
Chief, Litigation II Section, DC Bar # 435204.

/s/--------------------------------------------------------------------
Dorothy B. Fountain,
Assistant Chief, Litigation II Section.

/s/--------------------------------------------------------------------
Sharis A. Pozen,
Deputy Assistant Attorney General, DC Bar # 439469.

/s/--------------------------------------------------------------------
Katherine B. Forrest,
Deputy Assistant Attorney General.

/s/--------------------------------------------------------------------
Patricia A. Brink,
Director of Civil Enforcement.

/s/--------------------------------------------------------------------
Lowell R. Stern (DC Bar 440387),
Stephen A. Harris,
Blake W. Rushforth,
Milosz K. Gudzowski,
Attorneys, U.S. Department of Justice, Antitrust Division, 
Litigation II Section, 450 Fifth Street, NW, Suite 8700, Washington, 
DC 20530.

Tel.: (202) 514-3676
Fax: (202) 514-9033
E-mail: Lowell.Stern@usdoj.gov

For Plaintiff State of New York,

Eric T. Schneiderman,
Attorney General.

By:

/s/--------------------------------------------------------------------
Richard L. Schwartz,
Acting Chief, Antitrust Bureau.

/s/--------------------------------------------------------------------
Richard E. Grimm,
Assistant Attorney General.

/s/--------------------------------------------------------------------
Amy E. McFarlane,
Assistant Attorney General.

Office of the Attorney General,
Antitrust Bureau,
120 Broadway,
New York, New York 10271.

Tel.: (212) 416-8280
Tel.: (212) 416-6195
Fax: (212) 416-6015
E-mail: Richard.Grimm@ag.ny.gov
E-mail: Amy.McFarlane@ag.ny.gov

United States District Court for the District of Columbia

United States of America and State of New York, Plaintiffs, v. 
Stericycle, Inc., SAMW Acquisition Corporation, and Healthcare Waste 
Solutions, Inc., Defendants.

Case No.: 1:11-cv-00689
Assigned To: Howell, Beryl A.
Assign. Date: 4/8/2011
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 Stericycle, Inc., through SAMW Acquisition Corporation, 
and defendant Healthcare Waste Solutions, Inc. (``HWS''), entered into 
a merger agreement dated September 24, 2010, pursuant to which 
Stericycle would acquire all of HWS, except for an incinerator in 
Matthews, North Carolina, for $245 million.
    The United States and the State of New York filed a civil antitrust 
Complaint on April 8, 2011, seeking to enjoin the proposed acquisition, 
alleging that it likely would substantially lessen competition in the 
provision of infectious waste treatment services to customers in the 
New York City Metropolitan Area, in violation of Section 7 of the 
Clayton Act, 15 U.S.C. 18. The loss of competition from the acquisition 
likely would result in higher prices and reduced service for these 
customers of infectious waste treatment services.
    At the same time the Complaint was filed, the United States and the 
State of New York also filed a Hold Separate Stipulation and Order and 
proposed Final Judgment, which are designed to eliminate the 
anticompetitive effects that would result from Stericycle's acquisition 
of HWS. Under the proposed Final Judgment, which is explained more 
fully below, Stericycle is required to divest HWS's transfer station 
located in the Bronx, New York. Under the terms of the Hold Separate 
Stipulation and Order, Stericycle and HWS must take certain steps to 
ensure that the assets being divested continue to be operated in a 
competitively independent and economically viable manner and that 
competition for infectious waste treatment services is maintained 
during the pendency of the ordered divestiture.
    The United States, the State of New York, and the 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 Final Judgment 
and to punish violations thereof.

II. Description of the Events Giving Rise to the Alleged Violation

A. The Defendants

    Stericycle is a Delaware corporation with its principal place of 
business in Lake Forest, Illinois. Stericycle, a multi-national 
company, is the largest provider of infectious waste treatment services 
in the United States, with operations in all 50 states, including 54 
treatment facilities. In 2009, Stericycle had U.S. revenues of $913 
million. SAMW Acquisition Corporation is a corporation formed by 
Stericycle to facilitate its acquisition of HWS.
    HWS is a Delaware corporation with its principal place of business 
in Cincinnati, Ohio. HWS is the second-largest provider of infectious 
waste treatment services in the United States, with operations in 15 
states that include six treatment facilities. In 2009, HWS had total 
revenues of about $31 million.

B. The Competitive Effect of the Acquisition on Infectious Waste 
Treatment Services

1. Background
    Regulated medical waste is waste generated in the diagnosis, 
treatment, or immunization of human beings or animals. There are 
generally three types of regulated medical waste: (1) Infectious waste; 
(2) pathological waste; and (3) trace chemotherapy waste. Infectious 
waste is waste that has come into contact with bodily fluids and 
``sharps'' waste, such as syringes and scalpels. Pathological waste is 
anatomical parts, and trace chemotherapy waste is small amounts of 
chemical compounds used to treat cancer patients and the equipment used 
to administer the compounds. Infectious waste comprises approximately 
90 percent of the regulated medical waste generated in the United 
States.
    State and federal governments heavily regulate the treatment of 
regulated

[[Page 21010]]

medical waste. They prescribe how each type of regulated medical waste 
must be stored, collected, and treated. Providers of infectious waste 
treatment services are required to be licensed by various state and 
federal regulatory agencies before they can offer such services. 
Regulated medical waste must be stored separately from other types of 
waste, and each type of regulated medical waste must be stored 
separately from the other types in specially marked and sealed 
containers. State-approved treatment facilities must be used to render 
infectious waste non-infectious. Failure to use state-approved 
treatment facilities subjects both the generator of the infectious 
waste and the infectious waste treatment service provider to criminal 
prosecution, fines, damage actions, and potentially high clean-up 
costs.
    Autoclave sterilization is the most common treatment for infectious 
waste. An autoclave uses steam sterilization combined with pressure to 
render infectious waste non-infectious. Autoclave sterilization is not 
approved for pathological or trace chemotherapy waste, which instead 
must be incinerated in a specially licensed medical waste incinerator.
    Infectious waste is typically collected from generator sites (e.g., 
hospitals and physician offices) on daily route trucks and then 
transported to treatment facilities. Route trucks are vans and, more 
typically, 16- to 24-foot straight trucks. A daily route truck 
typically travels a route within a 75- to 100-mile radius of its 
garage.
    Obtaining approval for an infectious waste treatment facility in 
and around large urban areas, such as New York City, is difficult. Only 
one such commercial facility operates in the New York City Metropolitan 
Area. Transporting large volumes of infectious waste to distant 
treatment facilities using daily route trucks is not cost-effective. 
Therefore, service providers serve such areas by using local transfer 
stations. Once the daily route truck has delivered the infectious waste 
to a local transfer station, the collection function is completed. At a 
transfer station, containers of infectious waste are unloaded from the 
daily route trucks and loaded onto tractor trailers for efficient 
shipment to more distant treatment facilities.
    The size of the market for the provision of infectious waste 
treatment services is largely influenced by transportation costs 
because such costs represent a large share of the total cost of 
providing treatment services. Defendants Stericycle and HWS own and 
operate numerous autoclave facilities for the treatment of infectious 
waste. Stericycle's and HWS's closest facilities to New York City are 
located in Sheridan and Oneonta, New York; Woonsocket, Rhode Island; 
and Morgantown and Marcus Hook, Pennsylvania. The closest of these is 
about 180 miles from New York City. It is not cost-effective to 
transport large volumes of infectious waste to these distant facilities 
using daily route trucks.
    Stericycle and HWS operate local transfer stations in and around 
New York City and compete to provide infectious waste treatment 
services by serving customers through these local transfer stations. In 
and around New York City, Stericycle owns and operates local transfer 
stations in the Bronx, Staten Island, West Babylon, and Farmingdale, 
New York. Stericycle also owns local transfer stations in Piscataway 
and Bloomfield, New Jersey. HWS owns and operates a local transfer 
station in the Bronx, New York.
    In the New York City Metropolitan Area, encompassing the City of 
New York, and the counties of Westchester, Rockland, Nassau, and 
Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, 
Union, and Middlesex in New Jersey, and the county of Fairfield in 
Connecticut, apart from one small competitor, no other infectious waste 
treatment service provider has a local transfer station located within 
approximately 100 miles of Stericycle's or HWS's local transfer 
stations.
2. Relevant Market
    The provision of infectious waste treatment services to customers 
in the New York City Metropolitan Area is a line of commerce and 
relevant price discrimination service market within the meaning of 
Section 7 of the Clayton Act. Infectious waste treatment differs from 
treatment for other types of waste, including other types of regulated 
medical waste. There are no legal alternatives to treating infectious 
waste other than using an approved treatment technology, such as 
autoclave sterilization.
    Defendants provide infectious waste treatment services to New York 
City Metropolitan Area customers using local transfer stations. Other 
infectious waste treatment service providers that operate treatment 
facilities more than 100 miles from the New York City Metropolitan Area 
cannot cost-effectively compete to provide infectious waste treatment 
services without a local transfer station located in the New York City 
Metropolitan Area. A small but significant increase in the price of 
infectious waste treatment services would not cause New York City 
Metropolitan Area customers to move sufficient volumes of infectious 
waste to another type of treatment service, or to switch to an 
infectious waste treatment service provider that does not operate a 
local transfer station, in sufficient numbers so as to make such a 
price increase unprofitable. The relevant market is the provision of 
infectious waste treatment services to customers in the New York City 
Metropolitan Area.
3. Anticompetitive Effects of the Transaction
    In the New York City Metropolitan Area, the acquisition would 
remove a significant competitor in the treatment of infectious waste in 
an already highly concentrated market. The proposed acquisition would 
reduce from three to two the number of competitors with local transfer 
stations, and Stericycle and HWS would have approximately 90 percent of 
the infectious waste treatment market in the New York City Metropolitan 
Area. Vigorous price competition between Stericycle and HWS in the 
provision of infectious waste treatment services has benefited 
customers in the New York City Metropolitan Area. The third competitor 
is a small firm that opened an autoclave treatment facility in Mount 
Vernon, New York, in 2010; it is unlikely to replace the competition 
lost as a result of the merger.
    The proposed acquisition will eliminate the competition between 
Stericycle and HWS and enable Stericycle to raise prices and lower 
quality of service for customers in the New York City Metropolitan 
Area, in violation of Section 7 of the Clayton Act.
 4. Entry Into the Treatment of Infectious Waste
    Successful entry into the provision of infectious waste treatment 
services for customers in the New York City Metropolitan Area is 
unlikely without first obtaining a local transfer station from which 
waste can be transferred to more distant treatment facilities.
    A prospective provider of infectious waste treatment services faces 
substantial barriers to site and build a transfer station. Obtaining 
the state and local permits and approvals necessary to site an 
infectious waste transfer station would require a substantial 
investment in time and money, without any guarantee that the permits 
and approvals would ultimately be granted. In recent years, several 
infectious waste treatment service providers have attempted without 
success to obtain the

[[Page 21011]]

necessary permits to site a local transfer station within New York 
City.
    Entry into the provision of infectious waste treatment services to 
customers in the New York City Metropolitan Area would not be timely, 
likely, or sufficient to counter anticompetitive price increases or 
diminished quality of service that Stericycle could impose after the 
proposed acquisition.

III. Explanation of the Proposed Final Judgment

    The terms of the proposed Final Judgment will eliminate the 
anticompetitive effects of the acquisition alleged in the Complaint. 
Section IV of the proposed Final Judgment requires defendants, within 
forty-five (45) 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 HWS's transfer station in the Bronx, New 
York, which is used in the provision of infectious waste treatment 
services to customers in the New York City Metropolitan Area. The 
acquirer of the transfer station, along with associated tangible and 
intangible assets, must be acceptable to the United States, in its sole 
discretion after consultation with the State of New York. The 
divestiture of these assets according to the terms of the proposed 
Final Judgment will establish a new, independent, and economically 
viable competitor, thereby preserving competition in the provision of 
infectious waste treatment services to customers in the New York City 
Metropolitan Area.
    In the event that defendants do not accomplish the divestiture 
within the time prescribed in the proposed Final Judgment, the proposed 
Final Judgment provides that the Court will appoint a trustee selected 
by the United States to effect the divestitures. 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 divestitures are 
accomplished. After his or her appointment becomes effective, the 
trustee will file monthly reports with the Court, United States, and 
the State of New York as appropriate, setting forth his or her efforts 
to accomplish the divestitures. At the end of six months, if the 
divestitures have not been accomplished, the trustee, the United 
States, and the State of New York, 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.
    The Final Judgment also requires, in Section VIII, that defendants 
provide advance notification of certain future proposed acquisitions 
not otherwise subject to the Hart-Scott-Rodino Antitrust Improvements 
Act of 1976, 15 U.S.C. 18a. That provision requires 30 days' advance 
written notice to the United States and the State of New York before 
defendants acquire, directly or indirectly, (1) Interest in any 
business engaged in the treatment of infectious waste that serves the 
New York City Metropolitan Area; (2) other than in the ordinary course 
of business, assets of a person engaged in the treatment of infectious 
waste generated in the New York City Metropolitan Area; or (3) capital 
stock or voting securities of any person that, at any time during the 
twelve (12) months immediately preceding such acquisition, was engaged 
in the treatment of infectious waste generated in the New York City 
Metropolitan Area, where that person's annual revenues in this area 
from the treatment of infectious waste were in excess of $500,000. With 
this provision, the United States and the State of New York will have 
knowledge in advance of acquisitions that may impact competition in the 
provision of infectious waste treatment services in the New York City 
Metropolitan Area.

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 the defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States, the State of New York, and the defendants have 
stipulated that the proposed Final Judgment may be entered by the Court 
after compliance with the provisions of the APPA, provided that the 
United States has not withdrawn its consent. The APPA conditions entry 
upon the Court's determination that the proposed Final Judgment is in 
the public interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date of publication of this Competitive 
Impact Statement in the Federal Register, 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, 450 Fifth Street, NW., Suite 8700, 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 commenced litigation and sought a judicial 
order enjoining the acquisition of HWS by Stericycle. The United States 
is satisfied that the divestiture and other relief described in the 
proposed Final Judgment will preserve competition in the provision of 
infectious waste treatment services for customers in the New York City 
Metropolitan Area. The relief contained in the proposed Final Judgment 
would achieve all or substantially all of the relief that the United 
States would have obtained through litigation, while avoiding the time, 
expense, and uncertainty of a full trial on the merits of the 
Complaint.

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

[[Page 21012]]

the United States be subject to a sixty-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)(1). 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 (DC Cir. 1995); see generally United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1 (D.DC 2007) (assessing public 
interest standard under the Tunney Act); United States v. InBev N.V./
S.A., 2009-2 Trade Cas. (CCH) ] 76,736, 2009 U.S. Dist. LEXIS 84787, 
No. 08-1965 (JR), at *3, (D.DC Aug. 11, 2009) (noting that the court's 
review of a consent judgment is limited and only inquires ``into 
whether the government's determination that the proposed remedies will 
cure the antitrust violations alleged in the complaint was reasonable, 
and whether the mechanisms to enforce the final judgment are clear and 
manageable'').
    As the United States Court of Appeals for the District of Columbia 
has held, under the APPA, a court considers, among other things, the 
relationship between the remedy secured and the 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); InBev, 2009 U.S. Dist. LEXIS 84787, at *3. 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).\1\ 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-
Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.DC 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); United States v. 
Republic Serv., Inc., 2010-2 Trade Cas. (CCH) ] 77,097, 2010 U.S. Dist. 
LEXIS 70895, No. 08-2076 (RWR), at *160 (D.D.C. July 15, 2010) (finding 
that ``[i]n light of the deferential review to which the government's 
proposed remedy is accorded, [amicus curiae's] argument that an 
alternative remedy may be comparably superior, even if true, is not a 
sufficient basis for finding that the proposed final judgment is not in 
the public interest.'').
---------------------------------------------------------------------------

    \1\ Cf. 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' '').
---------------------------------------------------------------------------

    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. 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). Therefore, the United States ``need only 
provide a factual basis for concluding that the settlements are 
reasonably adequate remedies for the alleged harms.'' SBC Commc'ns, 489 
F. Supp. 2d at 17; Republic Serv., 2010 U.S. Dist. LEXIS 70895, at *158 
(entering final judgment ``[b]ecause there is an adequate factual 
foundation upon which to conclude that the government's proposed 
divestitures will remedy the antitrust violations alleged in the 
complaint.'').
    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; see also InBev, 2009 
U.S. Dist. LEXIS 84787, at *20 (``the `public interest' is not to be 
measured by comparing the violations alleged in the complaint against 
those the court believes could have, or even should have, been 
alleged''). 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. Microsoft, 56 F.3d at 1459-60. 
As this Court 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.'' 489 F. Supp. 2d at 15.
    In its 2004 amendments to the Tunney Act,\2\ Congress made clear 
its

[[Page 21013]]

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 wrote 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.\3\
---------------------------------------------------------------------------

    \2\ The 2004 amendments substituted the word ``shall'' for 
``may'' when directing the courts to consider the enumerated factors 
and amended the list of factors to focus on competitive 
considerations and 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).
    \3\ See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 
(D.DC 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.'').
---------------------------------------------------------------------------

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: April 8, 2011.

 Respectfully submitted,

/s/--------------------------------------------------------------------
Lowell R. Stern (DC Bar 440487),
U.S. Department of Justice, Antitrust Division, Litigation II 
Section, 450 Fifth Street, NW., Suite 8700, Washington, DC 20530.

Tel.: (202) 514-3676,
E-mail: lowell.stern@usdoj.gov.

United States District Court for the District of Columbia

    United States of America and State of New York, Plaintiffs, v. 
Stericycle, Inc., SAMW Acquisition Corp., and Healthcare Waste 
Solutions, Inc., Defendants.

Case No.:
Judge:
Deck Type: Antitrust
Date Stamp:

Proposed Final Judgment

    Whereas, plaintiffs, the United States of America and the State of 
New York, filed their Complaint on April ------, 2011; plaintiffs and 
defendants, Stericycle, Inc. and SAMW Acquisition Corp., and Healthcare 
Waste Solutions, Inc., 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 the Divestiture Asset to assure that competition 
is not substantially lessened;
    And Whereas, plaintiffs require defendants to make a divestiture 
for the purpose of remedying the loss of competition alleged in the 
Complaint;
    And whereas, defendants have represented to plaintiffs that the 
divestiture 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, 15 U.S.C. 18, as amended.

II. Definitions

    As used in this Final Judgment:
    A. ``Acquirer'' means the entity to which defendants shall divest 
the Divestiture Asset.
    B. ``Stericycle'' means defendant Stericycle, Inc., a Delaware 
corporation with its principal place of business in Lake Forest, 
Illinois, and SAMW Acquisition Corp. (a corporation formed to 
facilitate the acquisition), and their successors, assigns, 
subsidiaries, divisions, groups, affiliates, partnerships, and joint 
ventures, and all of their directors, officers, managers, agents, and 
employees.
    C. ``HWS'' means defendant Healthcare Waste Solutions, Inc., a 
Delaware corporation with its principal place of business in 
Cincinnati, Ohio, and its successors, assigns, subsidiaries, divisions, 
groups, affiliates, partnerships, and joint ventures, and all of their 
directors, officers, managers, agents, and employees.
    D. ``Infectious Waste'' means regulated medical waste that is 
generated in the diagnosis, treatment, or immunization of human beings 
or animals and that has come into contact with bodily fluids, and 
``sharps'' waste, such as syringes and scalpels.
    E. ``Treatment'' means the sterilization of infectious waste at a 
state-approved treatment facility, including the use of transfer 
stations to facilitate the shipment of infectious waste to other 
treatment sites.
    F. ``Divestiture Asset'' means HWS's Bronx, New York transfer 
station, located at 1281 Viele Avenue, Bronx, New York 10474, 
including:

    1. Tangible assets at the HWS facility identified in this 
Paragraph II(F), including all research and development activities, 
equipment, and fixed assets, real property (leased or owned), 
equipment, personal property, inventory, office furniture, 
materials, supplies, on- or off-site warehouses or storage 
facilities; all licenses, permits, and authorizations issued by any 
governmental organization relating to the facilities; and all 
facility records, but excluding assets used exclusively in the HWS 
collection business; and
    2. All intangible assets associated with the HWS facility 
identified in this Paragraph II(F), including, but not limited to, 
all contractual rights, patents, licenses and sublicenses, 
intellectual property, technical information, computer software 
(including waste monitoring software and management information 
systems) and related documentation, 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 provided to employees, customers, 
suppliers, agents or licensees, but excluding assets used 
exclusively in the HWS collection business.

    G. ``New York City Metropolitan Area'' means the area encompassing 
the City of New York, and the counties of Westchester, Rockland, 
Nassau, and

[[Page 21014]]

Suffolk in New York, the counties of Hudson, Bergen, Passaic, Essex, 
Union, and Middlesex in New Jersey, and the county of Fairfield in 
Connecticut.

III. Applicability

    A. This Final Judgment applies to Stericycle and HWS, as defined 
above, and all other persons in active concert or participation with 
either of them, who receive actual notice of this Final Judgment by 
personal service or otherwise.
    B. 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 Asset, 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. Divestiture

    A. Defendants are ordered and directed, within forty-five (45) 
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 Asset in a 
manner consistent with this Final Judgment to an Acquirer acceptable to 
the United States in its sole discretion, after consultation with the 
State of New York. The United States, in its sole discretion, after 
consultation with the State of New York, may agree to one or more 
extensions of this time period not to exceed thirty (30) calendar days 
in total, and shall notify the Court in such circumstances. Defendants 
agree to use their best efforts to divest the Divestiture Asset 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 Asset. Defendants shall inform any 
person making an inquiry regarding a possible purchase of the 
Divestiture Asset that it is 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 Asset customarily provided in a due 
diligence process except such information or documents subject to the 
attorney-client privilege or work-product 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 the personnel involved in the operation and 
management of the Divestiture Asset to enable the Acquirer to make 
offers of employment. Defendants shall not interfere with any 
negotiations by the Acquirer to employ or contract with any defendant 
employee whose primary responsibility is the operation or management of 
the Divestiture Asset.
    D. Defendants shall permit prospective Acquirers of the Divestiture 
Asset to have reasonable access to personnel and to make inspections of 
the physical facility of the Divestiture Asset; 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 the Divestiture 
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 Asset.
    G. Defendants shall warrant to the Acquirer that there are no 
material defects in the environmental, zoning or other permits 
pertaining to the operation of the Divestiture Asset, and that 
following the sale of the Divestiture Asset, defendants will not 
undertake, directly or indirectly, any challenges to the environmental, 
zoning, or other permits relating to the operation of the Divestiture 
Asset.
    H. Unless the United States, after consultation with the State of 
New York, otherwise consents in writing, the divestiture pursuant to 
Section IV, or by trustee appointed pursuant to Section V, of this 
Final Judgment, shall be accomplished in such a way as to satisfy the 
United States, in its sole discretion, after consultation with the 
State of New York, that the divestiture will achieve the purposes of 
this Final Judgment and that the Divestiture Asset can and will be used 
by the Acquirer as part of a viable, ongoing business providing 
infectious waste treatment services. The divestiture, whether pursuant 
to Section IV or Section V of this Final Judgment:

    1. Shall be made to the Acquirer that, in the United States's 
sole judgment, after consultation with the State of New York, has 
the intent and capability (including the necessary managerial, 
operational, technical and financial capability) of competing 
effectively in the business of providing infectious waste treatment 
services; and
    2. Shall be accomplished so as to satisfy the United States, in 
its sole discretion, after consultation with the State of New York, 
that none of the terms of any agreement between the Acquirer and 
defendants gives defendants the ability unreasonably to raise the 
Acquirer's costs, to lower the Acquirer's efficiency, or otherwise 
to interfere in the ability of the Acquirer to compete effectively.

V. Appointment of Trustee

    A. If defendants have not divested the Divestiture Asset within the 
time period specified in Section IV, 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 sale of the Divestiture Asset.
    B. After the appointment of a trustee becomes effective, only the 
trustee shall have the right to sell the Divestiture Asset. The trustee 
shall have the power and authority to accomplish the divestiture to an 
Acquirer acceptable to the United States, after consultation with the 
State of New York, 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 defendants' cost and expense any investment bankers, attorneys, or 
other agents, who shall be solely accountable to the trustee, 
reasonably necessary in the trustee's judgment to assist in the 
divestiture.
    C. Defendants shall not object to a sale by the trustee on any 
ground other than the trustee's malfeasance. Any such objections by 
defendants must be conveyed in writing to the United States and the 
trustee within ten (10) calendar days after the trustee has provided 
the notice required under Section VI.
    D. The trustee shall serve at the cost and expense of defendants, 
on such terms and conditions as the United States approves, and shall 
account for all monies derived from the sale of the Divestiture Asset 
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 Asset and based on a fee arrangement providing 
the trustee with an incentive based on the price and terms of the 
divestiture and

[[Page 21015]]

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 facility of the Divestiture Asset, and defendants shall 
develop financial and other information relevant to the Divestiture 
Asset 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 State of New York, 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 Asset, 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 Asset.
    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
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