United States v. Cumulus Media Inc., et al.; Proposed Final Judgment and Competitive Impact Statement, 56797-56807 [2011-23548]

Agencies

• Antitrust Division
• Department of Justice

[Federal Register Volume 76, Number 178 (Wednesday, September 14, 2011)]
[Notices]
[Pages 56797-56807]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-23548]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Cumulus Media 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 
v. Cumulus Media Inc., et al., Civil Action No. 1:11-cv-01619. On 
September 8, 2011, the United States filed a Complaint alleging that 
Cumulus Media Inc.'s proposed acquisition of Citadel Broadcasting 
Corporation 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 Cumulus to divest certain broadcast radio stations in 
Harrisburg-Lebanon-Carlisle, Pennsylvania and Flint, Michigan, along 
with certain tangible and intangible assets.

[[Page 56798]]

    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 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 filed with the 
Court and may be published in the Federal Register. Comments should be 
directed to John Read, Chief, Litigation III Section, Antitrust 
Division, Department of Justice, Washington, DC 20530,; (telephone: 
202-307-0468).

Patricia A. Brink,
Director of Civil Enforcement.

United States District Court for the District of Columbia

United States of America, United States Department of Justice, 
Antitrust Division, Litigation III Section, 450 Fifth Street, NW., 4th 
Floor, Washington, DC 20530, Plaintiff, v.
Cumulus Media Inc., 3280 Peachtree Road, NW., Atlanta, Georgia 30305, 
and
Citadel Broadcasting Corporation, 7690 West Cheyenne Avenue, Suite 220, 
Las Vegas, Nevada 89129, Defendants.

Case: 1:11-cv-01619, Assigned To: Sullivan, Emmet G., Assign. Date: 9/
8/2011, Description: Antitrust.

Complaint

    The United States of America, acting under the direction of the 
Attorney General of the United States, brings this civil action to 
enjoin the proposed acquisition of Citadel Broadcasting Corporation 
(``Citadel'') by Cumulus Media Inc. (``Cumulus''), and to obtain other 
equitable relief. The acquisition would likely substantially lessen 
competition for the sale of radio advertising in certain geographic 
markets in the United States, in violation of Section 7 of the Clayton 
Act, 15 U.S.C. 18. The United States alleges as follows:

I. Nature of the Action

    1. By agreement dated March 10, 2011, Cumulus agreed to acquire 
Citadel (by acquiring all of the shares of Citadel) in a cash-and-stock 
deal that values Citadel at about $2.5 billion.
    2. Cumulus and Citadel are two of the largest operators of 
broadcast radio stations in the United States. Cumulus' proposed 
acquisition of Citadel would make Cumulus the third largest operator of 
broadcast radio stations in the United States. Cumulus' and Citadel's 
radio stations provide substantial head-to-head competition against one 
another for the business of local and national companies that seek to 
advertise on radio stations in Harrisburg-Lebanon-Carlisle, 
Pennsylvania; and Flint, Michigan.
    3. As alleged in greater detail below, the proposed acquisition 
would eliminate this substantial head-to-head competition and would 
result in many advertisers paying higher prices for radio advertising 
time. Therefore, the proposed acquisition violates Section 7 of the 
Clayton Act. 15 U.S.C. 18.

II. Jurisdiction and Venue

    4. The United States brings this action pursuant to Section 15 of 
the Clayton Act, as amended, 15 U.S.C. 25, to prevent and restrain 
Defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18.
    5. Cumulus and Citadel sell radio advertising, a commercial 
activity that substantially affects, and is in the flow of, interstate 
commerce. The Court has subject-matter jurisdiction over this action 
pursuant to Section 15 of the Clayton Act, 15 U.S.C. 25, and 28 U.S.C. 
1331, 1337(a), and 1345.
    6. Citadel transacts business and is found in the District of 
Columbia. Cumulus has consented to venue in this District. Therefore, 
venue is proper in this District for Cumulus and Citadel under Section 
12 of the Clayton Act, 15 U.S.C. 22. Citadel and Cumulus have consented 
to personal jurisdiction in this District.

III. The Defendants

    7. Cumulus, organized under the laws of Delaware, with headquarters 
in Atlanta, Georgia, is one of the four largest radio broadcast 
companies in the United States in terms of revenue. In 2010, Cumulus 
reported radio broadcast revenues of approximately $259 million.
    8. Citadel, organized under the laws of Delaware, with headquarters 
in Las Vegas, Nevada, is one of the three largest radio broadcast 
companies in the United States in terms of revenue. For the period June 
1, 2010 through December 31, 2010, Citadel reported net revenues of 
approximately $444 million.

IV. Relevant Markets

    9. The relevant markets for Section 7 of the Clayton Act are the 
sale of radio advertising time to advertisers targeting listeners in 
two separate Arbitron Metro Survey Areas (``MSAs) by radio stations in 
those MSAs. The two MSAs are: Harrisburg-Lebanon-Carlisle, 
Pennsylvania, which includes Cumberland, Dauphin, Lebanon and Perry 
Counties in Pennsylvania (the ``Harrisburg MSA''); and Flint, Michigan, 
which includes Genesee County in Michigan (the ``Flint MSA'').
    10. Advertisers buy radio advertising time on Cumulus and Citadel 
radio stations within geographic areas defined by an MSA. An MSA is the 
geographical unit that is widely accepted by radio stations, 
advertisers and advertising agencies as the standard geographic area to 
use in evaluating radio audience size and composition. Cumulus and 
Citadel radio stations in the Harrisburg and Flint MSAs generate almost 
all of their revenues by selling advertising time to local, regional, 
and national advertisers who want to reach listeners in each of those 
MSAs. Typically, a radio station's advertising rates are based on the 
station's ability, relative to competing radio stations, to attract 
listening audiences that have certain demographic characteristics that 
advertisers want to reach.
    11. Many local and national advertisers purchase radio advertising 
time because they find such advertising preferable to advertising on 
other media platforms. Reasons for this include the fact that radio 
advertising time may be more cost-efficient and effective than other 
media at reaching the advertiser's target audience (individuals most 
likely to purchase the advertiser's products or services). In addition, 
radio stations offer certain services or promotional opportunities to 
advertisers that advertisers cannot obtain as effectively using other 
media.
    12. Local and national advertising that is placed on radio stations 
broadcasting into the Harrisburg or the Flint MSA is aimed at reaching 
listening audiences that are present in those MSAs. Radio stations that 
primarily broadcast into other MSAs do not provide effective access to 
those audiences.
    13. If there were a small but significant and non-transitory 
increase in the price that Harrisburg and Flint radio stations sold 
radio advertising time to advertisers targeting listeners in the 
Harrisburg and Flint MSAs, advertisers would not switch enough 
purchases to other radio stations or forms of advertising to render the 
price increase unprofitable. Although some

[[Page 56799]]

local and national advertisers may switch some of their advertising to 
other radio stations or media rather than absorb a price increase in 
radio advertising time in the Harrisburg or Flint MSAs, the existence 
of such alternatives would not prevent the Harrisburg or Flint radio 
stations from profitably raising their prices a small but significant 
amount. At a minimum, Harrisburg or Flint radio stations could 
profitably raise prices to those advertisers that view radio targeting 
listeners in Harrisburg or Flint as a necessary advertising medium, or 
as a necessary advertising complement to other media. Radio stations 
negotiate prices individually with advertisers; consequently, radio 
stations can charge different advertisers different prices. Radio 
stations generally can identify advertisers with strong preferences to 
advertise on radio in their MSAs. Because of this ability to price 
discriminate among customers, radio stations may charge higher prices 
to advertisers that view radio in their MSA as particularly effective 
for their needs, while maintaining lower prices for other advertisers.

V. Likely Anticompetitive Effects

    14. Radio station ownership in the Harrisburg and Flint MSAs is 
highly concentrated. Cumulus' and Citadel's combined advertising 
revenue shares exceed 40 percent in both the Harrisburg and Flint MSAs.
    15. As articulated in the Horizontal Merger Guidelines issued by 
the Department of Justice and the Federal Trade Commission, the 
Herfindahl-Hirschman Index (``HHI'') is a measure of market 
concentration.\1\ Market concentration is often one useful indicator of 
the likely competitive effects of a merger. The more concentrated a 
market, and the more a transaction would increase concentration in a 
market, the more likely it is that a transaction would result in a 
meaningful reduction in competition harming consumers. Mergers 
resulting in highly concentrated markets (with an HHI in excess of 
2,500) that involve an increase in the HHI of more than 200 points are 
presumed to be likely to enhance market power under the merger 
guidelines.
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    \1\ See U.S. Dep't of Justice, Horizontal Merger Guidelines 
Sec.  5.3 (2010), available at https://www.justice.gov/atr/public/guidelines/hmg-2010.html. The HHI is calculated by squaring the 
market share of each firm competing in the market and then summing 
the resulting numbers. For example, for a market consisting of four 
firms with shares of 30, 30, 20, and 20 percent, the HHI is 2,600 
(30\2\ + 30\2\ + 20\2\ + 20\2\ = 2,600). It approaches zero when a 
market is occupied by a large number of firms of relatively equal 
size and reaches a maximum of 10,000 points when a market is 
controlled by a single firm. The HHI increases both as the number of 
firms in the market decreases and as the disparity in size between 
those firms increases.
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    16. Concentration in both the Harrisburg and Flint MSAs would 
increase significantly as a result of the proposed acquisition. The 
post-acquisition HHI in the Harrisburg MSA would be approximately 
3,900. The post-acquisition HHI in the Flint MSA would be over 4,000. 
Both of these HHIs are well above the 2,500 threshold at which the 
Department normally considers a market to be highly concentrated. 
Cumulus' proposed acquisition of Citadel would result in a substantial 
increase in the HHI in both markets in excess of the 200 points 
presumed to be anticompetitive under the merger guidelines
    17. Advertisers that use radio to reach their target audiences 
select radio stations on which to advertise based upon a number of 
factors including, among others, the size and composition of a 
station's audience. Many advertisers seek to reach a large percentage 
of their target audiences by selecting those stations whose listening 
audience is highly correlated to their target audience. If a number of 
stations broadcasting in the same MSA efficiently reach a target 
audience, advertisers benefit from the competition among those stations 
to offer better prices and services.
    18. Cumulus and Citadel compete for listeners in the Harrisburg and 
Flint MSAs. Cumulus and Citadel each have stations in those two MSAs 
that seek to appeal to and attract the same listening audiences. For 
many local and national advertisers buying radio advertising time in 
the Harrisburg and Flint MSAs, the Cumulus and Citadel stations are 
close substitutes for each other based upon their specific audience 
characteristics.
    19. During individual price negotiations between advertisers and 
radio stations, advertisers often provide the stations with information 
about their advertising needs, including their target audience and the 
desired frequency and timing of ads. Radio stations have the ability to 
charge advertisers differing rates based in part on the number and 
attractiveness of competitive radio stations that can meet a particular 
advertiser's specific target needs.
    20. During these negotiations, advertisers that desire to reach a 
certain target audience can gain more competitive rates by ``playing 
off'' Cumulus stations against Citadel stations in the Harrisburg and 
Flint MSAs. The proposed acquisition would end this competition.
    21. Post-acquisition, if Cumulus raised prices or lowered services 
to those advertisers that buy advertising time on the Cumulus and 
Citadel stations in the Harrisburg or Flint MSAs, non-Cumulus radio 
stations in the Harrisburg or Flint MSAs would not be induced to change 
their formats to attract those audiences in sufficiently larger numbers 
to defeat a price increase. Successful radio stations are not likely to 
change a format solely in response to a small but significant price 
increase to advertisers by a multi-station firm such as Cumulus because 
they likely would lose their existing audiences. Even if less 
successful stations broadcasting in the Harrisburg and Flint MSAs did 
change format, they would still be unlikely to attract in a timely 
manner enough listeners to provide suitable alternatives to the post-
acquisition Cumulus.
    22. The entry of new radio stations into the Harrisburg and Flint 
MSAs would not be timely, likely or sufficient to deter the exercise of 
market power.
    23. The effect of the proposed acquisition of Citadel by Cumulus 
would be to lessen competition substantially in interstate trade and 
commerce in violation of Section 7 of the Clayton Act.

VI. Violation Alleged

    24. The United States hereby repeats and realleges the allegations 
of paragraphs 1 through 25 as if fully set forth herein.
    25. Cumulus' proposed acquisition of Citadel would likely 
substantially lessen competition in interstate trade and commerce, in 
violation of Section 7 of the Clayton Act, 15 U.S.C. 18, and would 
likely have the following effects, among others:
    (a) Competition in the sale of advertising time on radio stations 
in the Harrisburg and Flint MSAs would be substantially lessened;
    (b) Actual and potential competition in the Harrisburg and Flint 
MSAs between Cumulus and Citadel in the sale of radio advertising time 
would be eliminated; and
    (c) The prices for advertising time on radio stations in the 
Harrisburg and Flint MSAs would likely increase, and the quality of 
services would likely decline.

VII. Request for Relief

    The United States requests:
    (a) That the Court adjudge the proposed acquisition to violate 
Section 7 of the Clayton Act, 15 U.S.C. 18;
    (b) That the Court permanently enjoin and restrain the Defendants 
from carrying out the proposed acquisition or

[[Page 56800]]

from entering into or carrying out any other agreement, understanding, 
or plan by which Citadel would be acquired by, acquire, or merge with 
Cumulus;
    (c) That the Court award the United States the costs of this 
action; and
    (d) That the Court award such other relief to the United States as 
the Court may deem just and proper.

    Dated: September 8, 2011.

    Respectfully submitted,
    For Plaintiff United States.

Sharis A. Pozen (DC Bar 446732),
Acting Assistant Attorney General for Antitrust.

Patricia A. Brink,
Director of Civil Enforcement.

John R. Read (DC Bar 419373),
Chief.

David C. Kully (DC Bar 448763),
Assistant Chief, Litigation III Section.

Mark Merva (DC Bar 451743),
Attorney, Litigation III Section, Antitrust Division, U.S. 
Department of Justice 450 Fifth Street, NW., 4th Floor, Washington, 
DC 20530. Telephone: (202) 616-1398. Facsimile: (202) 514-7308. E-
mail: mark.merva@usdoj.gov.

United States of America, Plaintiff v.
Cumulus Media Inc., and Citadel Broadcasting Corporation; Defendants.

Case: 1:11-cv-01619.
Assigned To: Sullivan, Emmet G.
Assign. Date: 9/8/2011.
Description: Antitrust.

Competitive Impact Statement

    The 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

    The United States filed a civil antitrust Complaint on September --
, 2011, seeking to enjoin Cumulus Media Inc.'s (``Cumulus'') proposed 
acquisition of Citadel Broadcasting Corporation (``Citadel''), alleging 
that the acquisition would substantially lessen competition for radio 
advertising in Flint, Michigan and Harrisburg-Lebanon-Carlisle, 
Pennsylvania in violation of Section 7 of the Clayton Act, 15 U.S.C. 
18. At the same time the Complaint was filed, the United States also 
filed a Preservation of Assets Stipulation and Order and a proposed 
Final Judgment, which, as described below, are designed to eliminate 
the anticompetitive effects of the proposed acquisition.
    Under the terms of the proposed Final Judgment, Cumulus must divest 
three broadcast radio stations--WRSR (FM) licensed to Owosso, Michigan 
and owned by Cumulus (``WRSR''); WCAT-FM licensed to Carlisle, 
Pennsylvania and owned by Citadel (``WCAT''); and the assets used in 
the operation of WWKL (FM) licensed to Palmyra, Pennsylvania and owned 
by Cumulus (``WWKL'') (other than the station intellectual property), 
and the station intellectual property used in the operation of WTPA 
(FM) licensed to Mechanicsburg, Pennsylvania and owned by Cumulus 
(``WTPA''), including all programming contracts and rights 
(collectively the ``Radio Assets''). The Preservation of Assets 
Stipulation and Order requires that Cumulus and Citadel take steps to 
ensure that the Radio Assets will remain independent of and 
uninfluenced by Cumulus and Citadel prior to the Court's approval of 
the proposed Final Judgment. To ensure that competition is preserved 
during this time period, the Stipulation requires that the Court 
appoint a management trustee to serve as manager of the Radio Assets. 
The duties and responsibilities of the management trustee are set forth 
in the Stipulation. The management trustee will have the power to 
operate the Radio Assets in the ordinary course of business, so that 
they will remain independent and uninfluenced by defendants and so that 
the Radio Assets are preserved and operated as an ongoing and 
economically viable competitor to defendants and to other broadcast 
radio companies.
    At the time the Court approves the proposed Final Judgment, 
pursuant to Section IV of that proposed Final Judgment, the Court will 
appoint a divestiture trustee who will be responsible for divesting the 
Radio Assets. The United States contemplates that the Court will 
appoint the management trustee as the divestiture trustee upon the 
Court's approval of the proposed Final Judgment. Unless the United 
States grants an extension, it is contemplated that the divestiture 
trustee will divest the Radio Assets to a buyer or buyers that the 
Department, in its sole discretion, has approved within four (4) months 
of the date of entry of the proposed Final Judgment. After the Radio 
Assets are transferred to the divestiture trustee, the divestiture 
trustee will continue to operate the stations independently of Cumulus 
and Citadel as viable ongoing businesses.
    The United States and defendants have stipulated that the proposed 
Final Judgment may be entered after compliance with APPA. Entry of the 
proposed Final Judgment would terminate this action, except that the 
Court would retain jurisdiction to construe, modify, or enforce the 
provisions of the proposed Final Judgment, and to punish violations 
thereof.

II. The Alleged Violation

A. The Defendants

    Cumulus, organized under the laws of Delaware, with headquarters in 
Atlanta, Georgia, is one of the four largest radio broadcast companies 
in the United States in terms of revenue. In 2010, Cumulus reported 
radio broadcast revenues of approximately $259 million.
    Citadel, organized under the laws of Delaware, with headquarters in 
Las Vegas, Nevada, is one of the three largest radio broadcast 
companies in the United States in terms of revenue. For the period June 
1, 2010 through December 31, 2010, Citadel reported net revenues of 
approximately $444 million.

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

    On March 10, 2011, Cumulus agreed to acquire Citadel (by acquiring 
all of the shares of Citadel) in a cash-and-stock deal that values 
Citadel at about $2.5 billion. The proposed acquisition would make 
Cumulus the third largest operator of broadcast radio stations in the 
United States. Cumulus' and Citadel's radio stations compete head-to-
head against one another for the business of local and national 
companies that seek to purchase radio advertising time that targets 
listeners that are present in the Flint and Harrisburg MSAs. The 
proposed acquisition would eliminate that competition.

C. Anticompetitive Consequences of the Proposed Acquisition

1. Radio Advertising
    The Complaint alleges that the provision of radio advertising time 
to advertisers targeting listeners in two separate MSAs (the Flint MSA 
and the Harrisburg MSA) by radio stations in those MSAs are two 
relevant markets for purposes of Section 7 of the Clayton Act. 
Advertisers buy radio advertising time on Cumulus and Citadel radio 
stations within geographic areas defined by an MSA. An MSA is the 
geographical unit that is widely accepted by radio stations, 
advertisers and advertising agencies as the standard geographic area to 
use in evaluating radio audience size and composition.
    Cumulus and Citadel radio stations in the Harrisburg and Flint MSAs 
generate almost all of their revenues by selling advertising time to 
local and national advertisers who want to reach listeners present in 
each of those MSAs.

[[Page 56801]]

Typically, a radio station's advertising rates are based on the 
station's ability, relative to competing radio stations, to attract 
listening audiences that have certain demographic characteristics that 
advertisers want to reach.
    Many local and national advertisers purchase radio advertising time 
because they find such advertising preferable to advertising in other 
media for their specific needs. For such advertisers, radio time (a) 
May be less expensive and more cost-efficient than other media in 
reaching the advertiser's target audience (individuals most likely to 
purchase the advertiser's products or services); or (b) may offer 
promotional opportunities to advertisers that they cannot exploit as 
effectively using other media. For these and other reasons, many local 
and national advertisers who purchase radio advertising time view radio 
either as a necessary advertising medium for them or as a necessary 
advertising complement to other media.
    Local and national advertising placed on Flint and Harrisburg radio 
stations is aimed at reaching listening audiences in the Flint and 
Harrisburg MSAs. Radio stations that primarily broadcast into other 
MSAs do not provide effective access to audiences in the Flint and 
Harrisburg MSAs. If there were a small but significant increase in the 
price that Flint and Harrisburg radio stations sold radio advertising 
time to advertisers targeting listeners in the Flint and Harrisburg 
MSAs, advertisers would not switch enough purchases to other radio 
stations or forms of advertising to render the price increase 
unprofitable.
    Although some local and national advertisers may switch some of 
their advertising to other radio stations or media rather than absorb a 
price increase for radio advertising time in the Harrisburg or Flint 
MSAs, the existence of such alternatives would not prevent the 
Harrisburg or Flint radio stations from profitably raising their prices 
a small but significant amount. At a minimum, Harrisburg or Flint radio 
stations could profitably raise prices to those advertisers that view 
radio targeting listeners present in Harrisburg or Flint as a necessary 
advertising medium, or as a necessary advertising complement to other 
media. Radio stations negotiate prices individually with advertisers; 
consequently, radio stations can charge different advertisers different 
prices. Radio stations generally can identify advertisers with strong 
preferences to advertise on radio in their MSAs. Because of this 
ability to price discriminate among customers, radio stations may 
charge higher prices to advertisers that view radio in their MSA as 
particularly effective for their needs, while maintaining lower prices 
for other advertisers.
2. Harm to Competition
    The Complaint alleges that Cumulus' proposed acquisition of Citadel 
would lessen competition substantially in the sale of radio advertising 
time in the Flint and Harrisburg MSAs. In particular, the merger would 
further concentrate markets that are already highly concentrated. The 
Complaint alleges that Cumulus' market share in each of the Flint and 
Harrisburg MSAs would exceed 40 percent after the merger. Using a 
measure of market concentration called the Herfindahl-Hirschman Index 
(``HHI''), which is explained in Appendix A to the Complaint, the 
merger would result in concentration in each of these markets in excess 
of 3,900 points, well above the 2,500 threshold at which the United 
States normally considers a market to be highly concentrated.
    Furthermore, the Complaint alleges that the merger would eliminate 
substantial head-to-head competition between Cumulus and Citadel for 
advertisers seeking to reach specific audiences present in the Flint 
and Harrisburg MSAs. Advertisers select radio stations to reach a large 
percentage of their target audience based upon a number of factors, 
including, inter alia, the size of the station's audience, the 
characteristics of its audience, and the geographic reach of a 
station's signal. Many advertisers seek to reach a large percentage of 
their target listeners by selecting those stations whose audience best 
correlates to their target listeners. Today, Cumulus and Citadel each 
have stations in the Flint and Harrisburg MSAs that substantially 
compete head-to-head to reach the same target audiences. For many local 
and national advertisers buying time in each of those markets, the 
Cumulus and Citadel stations are close substitutes for each other based 
on their specific audience characteristics. During individual price 
negotiations between advertisers and radio stations, advertisers often 
provide the stations with information about their advertising needs, 
including their target audience and the desired frequency and timing of 
ads. Radio stations have the ability to charge advertisers differing 
rates based in part on the number and attractiveness of competitive 
radio stations that can meet a particular advertiser's specific target 
needs. During these negotiations, advertisers that desire to reach a 
certain target audience can gain more competitive rates by ``playing 
off'' Cumulus stations against Citadel stations in the Flint and 
Harrisburg MSAs. The proposed acquisition would end this competition.
    Format changes are unlikely to deter the anticompetitive 
consequences of this transaction. Successful radio stations are 
unlikely to undertake a format change solely in response to small but 
significant increases in price being charged to advertisers by a multi-
station firm such as Cumulus because they likely would lose a 
substantial portion of their existing audiences. Even if less 
successful stations did change format, they still would be unlikely to 
attract in a timely manner enough listeners to provide suitable 
alternatives to the Cumulus stations in their markets.
    For all of these reasons, the Complaint alleges that Cumulus' 
proposed acquisition of Citadel would lessen competition substantially 
in the sale of radio advertising time to advertisers targeting 
listeners present in the Flint and Harrisburg MSAs, eliminate head-to-
head competition between Cumulus and Citadel in the Flint and 
Harrisburg MSAs, and result in increased prices and reduced quality of 
service for radio advertisers in those MSAs, all in violation of 
Section 7 of the Clayton Act.

III. Explanation of the Proposed Final Judgment

    The proposed Final Judgment will preserve competition in the sale 
of radio advertising time to advertisers targeting listeners in the 
Flint and Harrisburg MSAs by requiring substantial radio station 
divestitures.

A. Radio Divestitures

    The proposed Final Judgment requires Cumulus to divest three 
broadcast radio stations--one in the Flint MSA and two in the 
Harrisburg MSA. The divestitures will reduce Cumulus' share in 
advertising revenues in the Flint and Harrisburg MSAs to less than 40 
percent. The divestitures will preserve choices for advertisers and 
will ensure that radio advertising prices do not increase and services 
do not decline as a result of the transaction.
    Cumulus must divest: WRSR, WCAT, and the Federal Communications 
Commission (``FCC'') license and broadcast signal associated with WWKL 
along with the intellectual property and broadcast radio programming 
associated with WTPA. The divestitures must be to a purchaser or 
purchasers acceptable to the United States in its sole discretion. 
Except in the case of WWKL, and unless the United States otherwise 
consents in writing, the divestitures will include all the assets of 
the stations being divested, and will be accomplished in a way that

[[Page 56802]]

will satisfy the United States, in its sole discretion, that such 
assets can and will be used as viable, ongoing commercial radio 
businesses. With respect to WWKL and WTPA, the divestiture will include 
assets sufficient to satisfy the United States, in its sole discretion, 
that such assets can and will be used to operate WWKL as a viable, 
ongoing, commercial radio business. The signal strength of that station 
will be 1,500 watts and the format of the station attracts listeners in 
the key demographic categories that advertisers desire. Thus, the WWKL/
WTPA divestiture will help maintain an economically viable competitor 
in the Harrisburg MSA.
    The relief in the proposed Final Judgment is intended to remedy the 
likely anticompetitive effects of Cumulus' proposed acquisition of 
Citadel in the Flint and Harrisburg MSAs. Nothing in the proposed Final 
Judgment is intended to limit the United States' ability to investigate 
other past or future activities of Cumulus or Citadel in the Flint and 
Harrisburg MSAs, or any other MSAs.
1. The Management Trustee
    The Preservation of Assets Stipulation and Order, filed at the same 
time as the Complaint, provides for the appointment of a management 
trustee to oversee the operations of the Radio Assets prior to the 
Court's approval of the proposed Final Judgment. The United States 
contemplates that the Court also will appoint the management trustee as 
the divestiture trustee pursuant to Section IV of the proposed Final 
Judgment upon the Court's approval of the proposed Final Judgment.
    Unless properly maintained, the value of the Radio Assets may 
diminish. As a result, the appointment of a management trustee is 
appropriate to ensure that the Radio Assets maintain their competitive 
viability and economic value prior to the Court's approval of the 
proposed Final Judgment. The management trustee will have the power to 
operate the Radio Assets in the ordinary course of business, so that 
they will remain independent and uninfluenced by defendants, and so 
that the Radio Assets are preserved and the related radio stations are 
operated as an ongoing and economically viable competitor to defendants 
and to other broadcast radio companies. The management trustee will 
preserve the confidentiality of competitively sensitive marketing, 
pricing, and sales information; ensure defendants' compliance with the 
Stipulation and the proposed Final Judgment; and maximize the value of 
the Radio Assets so as to permit expeditious divestiture in a manner 
consistent with the proposed Final Judgment.
    The Stipulation provides that defendants will pay all costs and 
expenses of the management trustee, including the cost of consultants, 
accountants, attorneys, and other representatives and assistants hired 
by the management trustee as are reasonably necessary to carry out his 
or her duties and responsibilities. After the management trustee's 
appointment becomes effective, the management trustee will file monthly 
reports with the United States setting forth efforts taken to 
accomplish the goals of the Stipulation and the proposed Final Judgment 
and the extent to which defendants are fulfilling their 
responsibilities.
2. The Divestiture Trustee
    The proposed Final Judgment provides that the Court will appoint a 
divestiture trustee, selected by the United States upon consultation 
with the FCC, to effect the divestitures of the Radio Assets and to 
serve until the Radio Assets are sold to one or more acquirers. Cumulus 
must divest WCAT and WWKL to an FCC trust in order to comply with FCC 
local ownership rules. The United States, having consulted with the 
FCC, will nominate a divestiture trustee. As part of the divestiture, 
defendants must relinquish any direct or indirect financial control and 
any direct or indirect role in management of the Radio Assets. Pursuant 
to Section IV of the proposed Final Judgment, the divestiture trustee 
will have the legal right to control the Radio Assets until they are 
sold to a final purchaser, subject to safeguards to prevent defendants 
from influencing their operation.
    Section IV of the proposed Final Judgment details the requirements 
for the establishment of the divestiture trust, the selection and 
compensation of the divestiture trustee, and the responsibilities of 
the divestiture trustee in connection with the divestiture and 
operation of the Radio Assets. The divestiture trustee has the 
authority to accomplish divestitures at the earliest possible time and 
``at such price and on such terms as are then obtainable upon 
reasonable effort by the trustee.''
    The proposed Final Judgment provides that defendants will pay all 
costs and expenses of the divestiture trustee. After the divestiture 
trustee's appointment becomes effective, the divestiture trustee will 
file monthly reports with the Court and the United States setting forth 
the divestiture trustee's efforts to accomplish the divestitures. 
Section IV(H) requires the divestiture trustee to divest the Radio 
Assets to an acceptable purchaser or purchasers no later than four 
months after the assets are transferred to the divestiture trustee, 
unless extended by the United States. At the end of that time, if all 
divestitures have not been accomplished, the divestiture trustee and 
the United States will make recommendations to the Court, which shall 
enter such orders as appropriate in order to carry out the purpose of 
the Final Judgment, including extending the trust or term of the 
divestiture trustee's appointment.
    The proposed Final Judgment also requires the defendants to 
maintain the independence of the Radio Assets, and requires those 
stations to be kept separate and apart from the defendants' other radio 
stations. The proposed Final Judgment also contains provisions intended 
to ensure that these stations will remain viable and aggressive 
competitors after divestiture.
    The divestiture provisions of the proposed Final Judgment will 
eliminate the anticompetitive effects of the transaction. The 
divestitures of the Radio Assets will preserve competition to sell 
radio advertising time to advertisers targeting listeners present in 
the Flint and Harrisburg MSAs by maintaining an independent and 
economically viable competitor in the Flint and Harrisburg MSAs.

B. Ban on Reacquisition

    The defendants may not reacquire any of the assets divested 
pursuant to the terms of the proposed Final Judgment during the term of 
the consent decree, which is for ten years unless extended by the 
Court. Reacquisition of any of those assets would undermine, if not 
negate, the benefits of the relief obtained in these markets. 
Accordingly, this provision is necessary to protect the integrity of 
the relief.

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

[[Page 56803]]

any subsequent private lawsuit that may be brought against defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States 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, 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:

John R. Read, Chief, Litigation III Section, Antitrust Division. United 
States Department of Justice, U.S. Department of Justice, 450 Fifth 
Street, NW., 4th Floor, 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 proposed 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 the defendants. The 
United States could have continued the litigation and sought 
preliminary and permanent injunctions against Cumulus' proposed 
acquisition of Citadel. The United States is satisfied, however, that 
the radio station divestitures described in the proposed Final Judgment 
will preserve competition in the sale of radio advertising in the Flint 
and Harrisburg MSAs, the markets described in the Complaint. Thus, the 
proposed Final Judgment would achieve all or substantially all of the 
relief the United States would have obtained through litigation, but 
avoids the time, expense, and uncertainty of a full trial on the merits 
of the Complaint.

VII. Standard of Review Under the APPA for the Proposed Final Judgment

    The APPA requires that proposed consent judgments in antitrust 
cases brought by the United States be subject to a sixty (60) day 
comment period, after which the court shall determine whether entry of 
the proposed Final Judgment ``is in the public interest.'' 15 U.S.C. 
16(e)(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 (D.C. Cir. 1995); see generally United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public 
interest standard under the Tunney Act); 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.D.C. 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 mechanism to enforce the final judgment are clear and 
manageable.'').\2\
---------------------------------------------------------------------------

    \2\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for court to consider and amended the 
list of factors to focus on competitive considerations and to 
address potentially ambiguous judgment terms. Compare 15 U.S.C. 
16(e) (2004), with 15 U.S.C. 16(e)(1) (2006); see also SBC Commc'ns, 
489 F. Supp. 2d at 11 (concluding that the 2004 amendments 
``effected minimal changes'' to Tunney Act review).
---------------------------------------------------------------------------

    As the United States Court of Appeals for the District of Columbia 
Circuit has held, under the APPA a court considers, among other things, 
the relationship between the remedy secured and the specific 
allegations set forth in the government's complaint, whether the decree 
is sufficiently clear, whether enforcement mechanisms are sufficient, 
and whether the decree may positively harm third parties. See 
Microsoft, 56 F.3d at 1458-62. With respect to the adequacy of the 
relief secured by the decree, a court may not ``engage in an 
unrestricted evaluation of what relief would best serve the public.'' 
United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing 
United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see 
also Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 
F. Supp. 2d 37, 40 (D.D.C. 2001); 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).\3\ In 
determining whether a proposed settlement is in the public interest, a 
district court ``must accord deference to the government's predictions 
about the efficacy of its remedies, and may not require that the 
remedies perfectly match the alleged violations.'' SBC

[[Page 56804]]

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.D.C. 2003) 
(noting that the court should grant due respect to the United States' 
prediction as to the effect of proposed remedies, its perception of the 
market structure, and its views of the nature of the case).
---------------------------------------------------------------------------

    \3\ 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.C. 1982) (citations omitted) (quoting United 
States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff'd 
sub nom. Maryland v. United States, 460 U.S. 1001 (1983); see also 
United States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 
1985) (approving the consent decree even though the court would have 
imposed a greater remedy). To meet this standard, the United States 
``need only provide a factual basis for concluding that the settlements 
are reasonably adequate remedies for the alleged harms.'' SBC Commc'ns, 
489 F. Supp. 2d at 17.
    Moreover, the court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its Complaint, and does not authorize the court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459; 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 recently confirmed in SBC Communications, courts ``cannot 
look beyond the complaint in making the public interest determination 
unless the complaint is drafted so narrowly as to make a mockery of 
judicial power.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments to the APPA, Congress made clear its intent 
to preserve the practical benefits of utilizing consent decrees in 
antitrust enforcement, adding the unambiguous instruction that 
``[n]othing in this section shall be construed to require the court to 
conduct an evidentiary hearing or to require the court to permit anyone 
to intervene.'' 15 U.S.C. 16(e)(2). The language wrote into the statute 
what Congress intended when it enacted the Tunney Act in 1974, as 
Senator Tunney explained: ``The court is nowhere compelled to go to 
trial or to engage in extended proceedings which might have the effect 
of vitiating the benefits of prompt and less costly settlement through 
the consent decree process.'' 119 Cong. Rec. 24,598 (1973) (statement 
of Senator Tunney). Rather, the procedure for the public interest 
determination is left to the discretion of the court, with the 
recognition that the court's ``scope of review remains sharply 
proscribed by precedent and the nature of Tunney Act proceedings.'' SBC 
Commc'ns, 489 F. Supp. 2d at 11.\4\
---------------------------------------------------------------------------

    \4\ See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 
(D.D.C. 2000) (noting that the ``Tunney Act expressly allows the 
court to make its public interest determination on the basis of the 
competitive impact statement and response to comments alone''); 
United States v. Mid-Am. Dairymen, Inc., 1977-1 Trade Cas. (CCH) ] 
61,508, at 71,980 (W.D. Mo. 1977) (``Absent a showing of corrupt 
failure of the government to discharge its duty, the Court, in 
making its public interest finding, should * * * carefully consider 
the explanations of the government in the competitive impact 
statement and its responses to comments in order to determine 
whether those explanations are reasonable under the 
circumstances.''); S. Rep. No. 93-298, 93d Cong., 1st Sess., at 6 
(1973) (``Where the public interest can be meaningfully evaluated 
simply on the basis of briefs and oral arguments, that is the 
approach that should be utilized.'').
---------------------------------------------------------------------------

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: September 8, 2011.

    Respectfully submitted,
Mark A. Merva (D.C. Bar  451743). Trial Attorney, 
Litigation III Section, Antitrust Division, U.S. Department of 
Justice, 450 Fifth Street, NW., 4th Floor, Washington, DC 20530, 
(202) 616-1398.

United States District Court for the District of Columbia

United States of America, Plaintiff: v.
Cumulus Media Inc., and Citadel Broadcasting Corporation; Defendants.

Case: 1:11-cv-01619.
Assigned To: Sullivan, Emmet G.
Assign. Date: 9/8/2011.
Description: Antitrust.

[Proposed] Final Judgment

    Whereas, Plaintiff, United States of America, filed its Complaint 
on August XX, 2011, and the United States of America and defendants 
Cumulus Media Inc. (``Cumulus'') and Citadel Broadcasting Corporation 
(``Citadel'') (collectively ``Defendants''), by their respective 
attorneys, have consented to the entry of this Final Judgment without 
trial or adjudication of any issue of fact or law, and without this 
Final Judgment constituting any evidence against or admission by any 
party regarding any issue of fact or law;
    And whereas, Defendants agree to be bound by the provisions of this 
Final Judgment pending its approval by the Court;
    And whereas, the essence of this Final Judgment is the prompt and 
certain divestiture of certain rights or assets by Defendants to assure 
that competition is not substantially lessened;
    And whereas, the United States requires Defendants to make certain 
divestitures for the purpose of remedying the loss of competition 
alleged in the Complaint;
    And whereas, Defendants have represented to the United States that 
the divestitures required below can and will be made and that 
Defendants will later raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the divestiture 
provisions contained below;
    Now therefore, before any testimony is taken, without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is ordered, adjudged and decreed:

I. Jurisdiction

    This Court has jurisdiction over the subject matter of and each of 
the parties to this action. The Complaint states claims upon which 
relief may be granted against Defendants under Section 7 of the Clayton 
Act, as amended (15 U.S.C. 18).

II. Definitions

    As used in this Final Judgment:
    (A) ``Acquirer'' or ``Acquirers'' means the person, persons, entity 
or entities to whom Defendants divest all or some of the Radio Assets.
    (B) ``Citadel'' means Defendant Citadel Broadcasting Corporation, a 
Delaware corporation with its headquarters in Las Vegas, Nevada, its 
successors and assigns, and its subsidiaries, divisions, groups,

[[Page 56805]]

affiliates, partnerships and joint ventures, and their directors, 
officers, managers, agents, and employees.
    (C) ``Cumulus'' means Defendant Cumulus Media Inc., a Delaware 
corporation with its headquarters in Atlanta, Georgia, its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships and joint ventures, and their directors, officers, 
managers, agents, and employees.
    (D) ``Defendants'' mean Cumulus and Citadel.
    (E) ``Divestiture Cities'' means the Flint, Michigan and 
Harrisburg-Lebanon-Carlisle, Pennsylvania Metropolitan Survey Areas 
defined as ``Arbitron Markets'' in the BIA Investing in Radio Market 
Report 2011.
    (F) ``WRSR'' means the broadcast radio station WRSR (FM) licensed 
to Owosso, Michigan owned by defendant Cumulus.
    (G) ``WCAT'' means the broadcast radio station WCAT (FM) licensed 
to Carlisle, Pennsylvania owned by defendant Citadel.
    (H) ``WWKL'' means the broadcast radio station WWKL (FM) licensed 
to Palmyra, Pennsylvania owned by defendant Cumulus.
    (I) ``WTPA'' means the broadcast radio station WTPA (FM) licensed 
to Mechanicsburg, Pennsylvania owned by defendant Cumulus.
    (J) ``Radio Assets'' means
    (1) All right, title, and interest of Cumulus and Citadel in and to 
the assets, tangible or intangible, used in the operations of WRSR and 
WCAT, including, but not limited to: (i) All real property (owned or 
leased) used in the operation of each station; (ii) all broadcast 
equipment, office equipment, office furniture, fixtures, materials, 
supplies, and other tangible property used in the operation of each 
station; (iii) all licenses, permits, and other authorizations issued 
by the Federal Communications Commission (``FCC'') and other government 
agencies related to each station, along with all applications pending 
before the FCC and other governmental agencies for any new 
authorizations or the renewal or modification of existing 
authorizations for each station; (iv) all contracts, agreements, leases 
and commitments of Cumulus or Citadel (including those relating to 
programming) relating to the operation of each station; (v) all 
trademarks, service marks, trade names, copyrights, patents, slogans, 
programming materials, and promotional materials relating to each 
station; and (vi) all logs and other records maintained by Cumulus or 
Citadel relating to the business of each station; save and except for 
any such specifically enumerated assets that are principally devoted to 
the operations of stations other than WRSR and WCAT or to the operation 
of their parent companies, and not necessary to the operation of WRSR 
and WCAT as viable, ongoing commercial radio broadcasting businesses;
    (2) All right, title, and interest of Cumulus and Citadel in and to 
the assets, tangible or intangible, used in the operation of WWKL 
(other than WWKL's intellectual property), including (i) All real 
property (owned or leased) used in the operation of WWKL; (ii) all 
broadcast equipment, office equipment, office furniture, fixtures, 
materials, supplies, and other tangible property used in the operation 
of WWKL; (iii) all licenses, permits, and other authorizations issued 
by the FCC and other government agencies related to WWKL, along with 
all applications pending before the FCC and other governmental agencies 
for any new authorizations or the renewal or modification of existing 
authorizations for WWKL; (iv) all contracts, agreements, leases and 
commitments of Cumulus or Citadel relating to the operation of WWKL but 
excluding (a) All contracts, agreements and commitments relating to 
programming, and (b) all trademarks, service marks, trade names, 
copyrights, patents, slogans, programming materials, and promotional 
materials used in the operation of WWKL; (v) all logs and other records 
maintained by Cumulus or Citadel relating to the business of WWKL; save 
and except for any such specifically enumerated assets that are 
principally devoted to the operations of stations other than WWKL or to 
the operation of its parent company, and not necessary to the operation 
of WWKL as a viable, ongoing commercial radio broadcasting business;
    (3) All right, title and interest of Cumulus in and to the 
intellectual property used in the operation of WTPA (which will be made 
available to the trustee in the operation and subsequent sale of WWKL), 
including (i) All programming contracts, agreements, and commitments; 
(ii) all trademarks, service marks, trade names, copyrights, patents, 
slogans, programming materials, and promotional materials used in the 
operation of WTPA; and (iii) records maintained by Cumulus or Citadel 
that identify parties who have purchased advertising time on WTPA in 
the prior twelve (12) months.

III. Applicability

    (A) This Final Judgment applies to both Defendants, as defined 
above, and all other persons in active concert or participation with 
the Defendants who receive actual notice of this Final Judgment by 
personal service or otherwise.
    (B) If, prior to complying with Section IV of this Final Judgment, 
Defendants sell, license, or otherwise dispose of all or substantially 
all of their assets or of lesser business units that include the Radio 
Assets, Defendants shall require the Acquirer or Acquirers to be bound 
by the provisions of this Final Judgment.

IV. Divestitures

    (A) The United States, having consulted with the FCC, will nominate 
a trustee to effect the divestiture of the Radio Assets and to serve 
until the Radio Assets are sold to one or more Acquirers. Defendants 
shall not object to the trustee's immediate appointment by this Court. 
In the event of the trustee's resignation, incapacity to act or death, 
this Court shall appoint another trustee, selected by the United 
States, after consultation with the FCC, to effect the divestiture of 
the Radio Assets. In this event, the United States will identify to 
Defendants the individual or entity it proposes to select as trustee. 
The United States will move the Court to approve and appoint a 
substitute trustee.
    (B) Unless the United States otherwise consents in writing, the 
divestitures by the trustee shall include all of the Radio Assets, and 
shall be accomplished in such a way as to satisfy the United States, in 
its sole discretion, that the divestiture will achieve the purposes of 
this Final Judgment and that the Radio Assets can and will be used by 
the Acquirer or Acquirers as part of one or more viable, ongoing 
commercial radio broadcasting businesses. Divestiture of the Radio 
Assets may be made to one or more Acquirers, provided that in each 
instance it is demonstrated to the sole satisfaction of the United 
States that the Radio Assets will remain viable and that the 
divestiture of such assets will remedy the competitive harm alleged in 
the Complaint. The divestitures pursuant to this Final Judgment:
    (i) Shall be made to an Acquirer or Acquirers that, in the United 
States' sole judgment, has or have the intent and capability (including 
the necessary managerial, operational, technical, and financial 
capability) of competing effectively in the commercial radio 
broadcasting business in the Divestiture Cities; and
    (ii) Shall be accomplished so as to satisfy the United States, in 
its sole discretion, that none of the terms of any agreement between an 
Acquirer or Acquirers and Defendants gives Defendants the ability 
unreasonably to

[[Page 56806]]

raise the Acquirer's costs, to lower the Acquirer's efficiency, or 
otherwise to interfere in the ability of the Acquirer to compete 
effectively.
    (C) Only the trustee shall have the right to sell the Radio Assets. 
The trustee shall have the power and authority to accomplish the 
divestitures to an Acquirer or Acquirers acceptable to the United 
States at such price and on such terms as are then obtainable upon 
reasonable effort by the trustee, subject to the provisions of Sections 
IV and V of this proposed Final Judgment, and shall have such other 
powers as this Court deems appropriate. Subject to Section IV (E) of 
this proposed Final Judgment, the trustee may hire at the cost and 
expense of Defendants any investment bankers, attorneys, or other 
agents, who shall be solely accountable to the trustee, reasonably 
necessary in the trustee's judgment to assist in the divestitures.
    (D) 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 V.
    (E) The trustee shall serve at the cost and expense of Defendants, 
on such terms and conditions as the United States approves, and shall 
account for all monies derived from the sale of the assets sold by the 
trustee and all costs and expenses so incurred. After approval by the 
Court of the trustee's accounting, including fees for its services and 
those of any professionals and agents retained by the trustee, all 
remaining money shall be paid to Defendants and the trust shall then be 
terminated. The compensation of the trustee and any professionals and 
agents retained by the trustee shall be reasonable in light of the 
value of the Radio Assets and based on a fee arrangement providing the 
trustee with an incentive based on the price and terms of the 
divestiture and the speed with which it is accomplished, but timeliness 
is paramount.
    (F) Defendants shall use their best efforts to assist the trustee 
in accomplishing the required divestiture. The trustee and any 
consultants, accountants, attorneys, and other persons retained by the 
trustee shall have full and complete access to the personnel, books, 
records, and facilities of the Radio Assets, and Defendants shall 
develop financial and other information relevant to the Radio Assets as 
the trustee may reasonably request, subject to reasonable protection 
for trade secrets or other confidential research, development, or 
commercial information. Defendants shall take no action to interfere 
with or to impede the trustee's accomplishment of the divestiture.
    (G) After its appointment, the trustee shall file monthly reports 
with the United States and the Court setting forth the trustee's 
efforts to accomplish the divestiture ordered under this Final 
Judgment. To the extent such repo