United States v. Verso Paper Corp. and NewPage Holdings Inc. Proposed Final Judgment and Competitive Impact Statement, 1957-1969 [2015-00466]

Agencies

• Antitrust Division
• Department of Justice

[Federal Register Volume 80, Number 9 (Wednesday, January 14, 2015)]
[Notices]
[Pages 1957-1969]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-00466]



[[Page 1957]]

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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Verso Paper Corp. and NewPage Holdings 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, 
Hold Separate Stipulation and Order, and Competitive Impact Statement 
have been filed with the United States District Court for the District 
of Columbia in United States of America v. Verso Paper Corp. and 
NewPage Holdings Inc., Civil No. 1:14-cv-2216. On December 31, 2014, 
the United States filed a Complaint alleging that Verso's proposed 
acquisition of NewPage would violate Section 7 of the Clayton Act, 15 
U.S.C. Sec.  18. The proposed Final Judgment, filed the same time as 
the Complaint, requires Verso to divest NewPage's coated paper mills in 
Biron, Wisconsin, and Rumford, Maine, including tangible and intangible 
assets necessary to operate the facilities.
    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, including the name of the submitter, and 
responses thereto, will be posted on the Department of Justice, 
Antitrust Division's internet Web site, filed with the Court and, under 
certain circumstances, published in the Federal Register. Comments 
should be directed to Peter J. Mucchetti, Chief, Litigation I Section, 
Antitrust Division, Department of Justice, 450 Fifth Street NW., Suite 
4100, Washington, DC 20530 (telephone: 202-307-0001).

Patricia A. Brink,
Director of Civil Enforcement.

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

    UNITED STATES OF AMERICA,
Department of Justice,
Antitrust Division,
450 Fifth Street NW., Suite 4100,
Washington, DC 20530,
Plaintiff,
v.
VERSO PAPER CORP.,
6775 Lenox Center Court,
Memphis, TN 38115,
and
NEWPAGE HOLDINGS INC.,
8540 Gander Creek Drive,
Miamisburg, OH 45342,
Defendants.

CASE NO. 1:14-cv-2216

JUDGE: Tanya S. Chutkan

FILED: 12/31/14

COMPLAINT

    The United States of America brings this antitrust action to enjoin 
Verso Paper Corp. from acquiring NewPage Holdings Inc. The proposed 
acquisition would likely substantially lessen competition in the 
manufacture and sale of coated freesheet web paper, coated groundwood 
paper, and label paper to customers in North America. By acquiring 
NewPage, Verso would eliminate its foremost competitor in the sale of 
these products.

I. INTRODUCTION

    1. Both Verso and NewPage produce two types of coated publication 
papers--coated freesheet web paper and coated groundwood paper. Post-
acquisition, the combined company would control approximately 50 
percent of the coated freesheet web market in North America, which 
accounts for more than $2 billion in sales, and 40 percent of the 
coated groundwood market, which accounts for more than $3 billion in 
sales. Vigorous competition between Verso and NewPage has ensured a 
reliable supply of high-quality coated publication papers to North 
American purchasers at competitive prices. Verso's proposed acquisition 
of NewPage would eliminate this intense competition, and would likely 
increase the incentives of the merged firm--and the remaining firms in 
the market--to increase prices and reduce output.
    2. Verso and NewPage are the largest producers in North America of 
two types of label paper: cut-and-stack label paper and face sheet for 
pressure-sensitive labels. Post-acquisition, the combined company would 
control approximately 70 percent of the North American label-paper 
market, which accounts for approximately $350 million in sales. Verso 
has been a fierce competitor to NewPage, the leading seller of label 
paper. Customers have taken advantage of this competition by playing 
Verso and NewPage off each other to obtain more favorable prices. 
Verso's acquisition of NewPage would extinguish this competition.

II. JURISDICTION, VENUE, AND INTERSTATE COMMERCE

    3. The United States brings this action under Section 15 of the 
Clayton Act, 15 U.S.C. Sec.  25, to prevent Verso and NewPage from 
violating Section 7 of the Clayton Act, 15 U.S.C. Sec.  18.
    4. This Court has subject-matter jurisdiction over this action 
under Section 15 of the Clayton Act, 15 U.S.C. Sec.  25.
    5. Verso and NewPage are engaged in, and their activities 
substantially affect, interstate commerce. Collectively, the parties' 
2013 coated freesheet web, coated groundwood, and label paper revenues 
in the United States were approximately $2.5 billion.
    6. Venue is proper in this District under Section 12 of the Clayton 
Act, 15 U.S.C. Sec.  22. Both Verso and New Page are corporations that 
sell publication papers to customers located in this District. Verso 
and NewPage have consented to personal jurisdiction and venue in this 
Court.

III. THE DEFENDANTS AND THE PROPOSED ACQUISITION

    7. Defendant Verso is a corporation headquartered in Memphis, 
Tennessee. It operates two mills that collectively produce coated 
freesheet web paper, coated groundwood paper, label paper, and other 
types of paper. Verso's mills are located in Maine and Michigan. In 
early December 2014, Verso closed its mill in Bucksport, Maine, which 
produced coated groundwood paper.
    8. Defendant NewPage is a corporation headquartered in Miamisburg, 
Ohio. NewPage operates eight mills that collectively produce coated 
freesheet web paper, coated groundwood paper, label paper, and other 
types of paper. These mills are located in Kentucky, Maryland, 
Michigan, Minnesota, Wisconsin, and Maine.
    9. On January 3, 2014, Verso agreed to acquire NewPage in a 
transaction valued at approximately $1.4 billion.

IV. THE COATED PAPER INDUSTRY

    10. Coated freesheet web paper and coated groundwood paper are 
coated on both sides with a clay or other coating. The coating gives 
the paper a smooth surface and glossy appearance and allows for 
printing of high-quality graphics.

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    11. Coated freesheet web paper is bright, heavier-weight glossy 
paper with excellent print qualities that is used primarily for annual 
reports, magazine covers and premium magazines, upscale brochures, and 
direct mail advertising. Coated freesheet web paper is produced for use 
in web printing applications. Web printing is typically used for large, 
high-speed printing jobs and requires paper rolls that are capable of 
being fed through the web printing equipment.
    12. Coated groundwood paper is typically used for the interior 
pages of magazines and catalogues, the covers of low-cost magazines, 
and other medium-quality printing applications. Together, coated 
freesheet web paper and coated groundwood paper are referred to in this 
complaint as ``coated publication papers.''
    13. Competition in the coated publication paper markets is driven 
by several factors, including head-to-head bidding between 
manufacturers to serve the particular needs of specific customers, and 
by capacity and demand conditions. Producers individually negotiate 
most sales with customers. Customers have varying preferences for 
coated publication papers due to the papers' varying characteristics, 
such as brightness, weight, printability, and smoothness. Customers 
often have specific requirements for the paper that they purchase, and 
customers typically evaluate each manufacturer's products and qualify 
their products before purchasing from that manufacturer. Producers try 
to manufacture products that meet the needs of printers and end users.
    14. Demand for most coated publication papers in North America has 
declined over the last several years because of a significant decline 
in demand for magazines, catalogues, and other publications. As a 
result, North American producers of coated publication papers have 
closed a number of mills and decommissioning of machines. Declining 
demand for coated publication papers is projected to continue, as is 
the closing of mills and decommissioned machines.
    15. Label paper is typically used to make labels for certain 
consumer goods, such as canned foods or wine bottles. Label paper is 
made from a type of freesheet paper that is coated on one side for 
printing, allowing the uncoated side to adhere to the product.

V. MARKET DEFINITION

A. Relevant Product Markets

1. Coated Freesheet Web Paper
    16. In the event of a small but significant and non-transitory 
price increase, purchasers of coated freesheet web paper are unlikely 
to substitute to other types of paper in sufficient quantities to make 
the price increase unprofitable because coated freesheet web paper has 
characteristics that distinguish it from other types of paper. Some of 
these characteristics affect the appearance and performance of the 
product, whereas other characteristics affect the printing process for 
which the paper may be used.
    17. Coated freesheet web paper is therefore a relevant product 
market and line of commerce under Section 7 of the Clayton Act.
2. Coated Groundwood Paper
    18. In the event of a small but significant and non-transitory 
price increase, purchasers of coated groundwood paper are unlikely to 
substitute to other types of paper in sufficient quantities to make the 
price increase unprofitable because other papers are typically more 
expensive, have a different look and feel, or otherwise have 
characteristics that are undesirable for coated groundwood 
applications.
    19. Coated groundwood paper is therefore a relevant product market 
and line of commerce under Section 7 of the Clayton Act.
3. Label Paper
    20. In the event of a small but significant and non-transitory 
price increase, purchasers of label paper are unlikely to substitute to 
other kinds of paper in sufficient quantities to make the price 
increase unprofitable because label paper produces a high-quality 
appearance, is coated on only one side, and has other desirable 
characteristics. Purchasers of label paper are also unlikely to 
substitute to other label options in sufficient quantities to make the 
price increase unprofitable because changing the type of label could 
require a change in the product's container or packaging.
    21. Label paper is therefore a relevant product market and line of 
commerce under Section 7 of the Clayton Act.

B. Relevant Geographic Market

    22. The relevant geographic market for analyzing the likely effects 
of the proposed acquisition on the sale of each relevant product is no 
larger than the United States and Canada (referred to here as ``North 
America,'' consistent with usage in the paper industry).
    23. Defining a geographic market based on the location of customers 
is appropriate where, as here, (1) producers charge different prices 
based on customer location, and (2) arbitrage by customers is 
difficult.
    24. For each relevant product, producers typically negotiate 
individual prices with each customer. Arbitrage is impractical because 
a customer in North America would need to find the product with the 
particular characteristics it requires from a customer outside of North 
America who has purchased that product at a significantly lower price 
to allow for shipping costs to North America. Furthermore, the 
additional costs of re-handling and re-shipping the product make 
arbitrage prohibitively expensive. Finally, a customer purchasing 
through arbitrage loses valuable services that producers often provide, 
such as inventory management, warranties, and technical support.
    25. In the event of a small but significant and non-transitory 
price increase, purchasers of each relevant product in North America 
are unlikely to defeat the price increase. North America is therefore a 
relevant geographic market for each relevant product under Section 7 of 
the Clayton Act.

VI. THE PROPOSED ACQUISITION WOULD LIKELY LEAD TO ANTICOMPETITIVE 
EFFECTS IN COATED PUBLICATION PAPERS

    26. The proposed acquisition would likely significantly increase 
market concentration, eliminate head-to-head competition between Verso 
and NewPage, increase incentives to raise prices and reduce output, and 
facilitate accommodating conduct by competitors in the sale of coated 
publication papers.
    27. The proposed acquisition would significantly increase market 
concentration for coated publication papers. Market concentration is a 
useful indicator of the level of competitive vigor in a market and the 
likely competitive effects of a proposed acquisition. The more 
concentrated a market, and the more a transaction would increase market 
concentration, the more likely it is that the transaction would 
substantially reduce competition. Concentration in relevant markets is 
typically measured by the Herfindahl-Hirschman Index (HHI). Markets in 
which the post-merger HHI is above 2,500 are considered highly 
concentrated. Mergers that increase the HHI by more than 200 points and 
result in a highly concentrated market are presumed likely to create or 
enhance market power. Markets in which the post-merger HHI is between 
1,500 and 2,500 are considered moderately concentrated. Mergers that 
increase the HHI by more than 100 points and result in a moderately 
concentrated market potentially raise significant competitive concerns.
    28. NewPage and Verso are the first and third largest competitors 
in the North American coated freesheet web paper market. New Page 
accounts for approximately 30 percent of market sales, and Verso 
accounts for

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approximately 20 percent. Post-merger, the merged firm would have an 
approximately 50 percent share, and with the next largest supplier, 
would account for approximately 80 percent of market sales.
    29. The proposed acquisition would result in a highly concentrated 
market for coated freesheet web paper, with a post-merger HHI of 
approximately 3,500. The proposed acquisition would increase the HHI by 
approximately 1,200, and thus significantly increase market 
concentration.
    30. NewPage and Verso are the first and second largest competitors 
in the North American coated groundwood market. NewPage and Verso each 
account for approximately 20 percent of market sales. Post-merger, the 
combined firm would have an approximately 40 percent share.
    31. The proposed acquisition would result in a moderately 
concentrated market with a post-merger HHI of approximately 2,200. The 
acquisition would increase the HHI by approximately 800, and thus 
significantly increase market concentration.
    32. Verso and NewPage have frequently competed for sales to coated 
publication paper customers. The proposed acquisition would eliminate 
this head-to-head competition.
    33. The proposed acquisition would also increase Verso's incentive 
and ability to raise price and reduce output of coated publication 
papers. Consequently, the acquisition would likely lead to increased 
downtime, accelerated mill closures, and reduced output in North 
America.
    34. The acquisition would likely facilitate accommodating conduct 
by competitors, leading to increased prices and reduced output. Despite 
the differentiated nature of coated publication paper markets, these 
markets are conducive to accommodating conduct by competitors. A small 
number of producers dominate the industry, and producers regularly 
obtain information from customers about their options and competitors' 
prices and product availability.

VII. THE PROPOSED ACQUISITION WOULD LIKELY LEAD TO ANTICOMPETITIVE 
EFFECTS IN THE LABEL-PAPER MARKET

    35. The proposed acquisition likely would substantially lessen 
competition in the sale of label paper. The acquisition would 
substantially increase market concentration and eliminate the head-to-
head competition between Verso and NewPage.
    36. NewPage accounts for approximately 60 percent of the market and 
Verso accounts for approximately 10 percent. Post-acquisition, the 
combined firm would have approximately a 70 percent share. The proposed 
acquisition is presumptively anticompetitive because it would 
substantially increase market concentration in the already highly 
concentrated label-paper market from approximately 3,800 to 5,300.
    37. Customers have played Verso and NewPage off each other in 
negotiations to obtain lower prices and better products and service. If 
the acquisition were completed, customers would no longer be able to do 
so, likely enabling the combined firm to raise prices and eliminating 
beneficial non-price competition between Verso and NewPage.

VIII. ABSENCE OF COUNTERVAILING FACTORS

    38. Entry by new competitors or expansion by existing competitors 
is unlikely to be timely or sufficient in scope to prevent the proposed 
acquisition's likely anticompetitive effects. Entry into publication 
papers is unlikely due to the declining demand for coated publication 
papers and the high cost of building a new coated paper mill. Entry 
into label papers is costly, uncertain, and time-consuming, as 
successful entrants need to test and qualify each new product with each 
major customer.
    39. Supply responses from overseas manufacturers are unlikely to 
prevent a substantial lessening of competition. Prices are generally 
higher for imports than for domestic products. Furthermore, foreign 
producers are limited by commitments to more profitable local markets; 
by significant transportation costs and logistical issues; by 
customers' exacting product specifications and preferences for short 
lead times; and by fluctuations in currency exchange rates, which 
disrupt consumer preferences for stable supply relationships.
    40. The acquisition is unlikely to produce sufficient merger-
specific, cognizable efficiencies that Verso would pass through to 
consumers to reverse the acquisition's likely anticompetitive effects.

IX. VIOLATION ALLEGED

    41. The effect of the proposed acquisition, if completed, would 
likely be to substantially lessen competition in interstate trade and 
commerce in the relevant markets, in violation of Section 7 of the 
Clayton Act, 15 U.S.C. 18.
    42. Unless enjoined, the proposed acquisition likely would have the 
following effects in each of the relevant markets:
    (a) competition between Verso and NewPage would be eliminated;
    (b) competition would likely be substantially lessened;
    (c) prices would likely be higher than they otherwise would; and
    (d) output would likely be lower than it otherwise would.

X. REQUEST FOR RELIEF

    43. The United States requests that the Court:
    (a) judge Verso's proposed acquisition of NewPage to violate 
Section 7 of the Clayton Act, 15 U.S.C. 18;
    (b) permanently enjoin Verso from acquiring any of the assets of 
NewPage or engaging in any other transaction that would combine the two 
companies;
    (c) award Plaintiff the costs of this action; and
    (d) award Plaintiff other just and proper relief.

    December 31, 2014.

    Respectfully Submitted,

FOR PLAINTIFF UNITED STATES OF AMERICA:

/s/--------------------------------------------------------------------

WILLIAM J. BAER

Assistant Attorney General for Antitrust.

/s/--------------------------------------------------------------------

DAVID I. GELFAND
Deputy Assistant Attorney General.

/s/--------------------------------------------------------------------

PATRICIA A. BRINK
Director of Civil Enforcement.

/s/--------------------------------------------------------------------

PETER J. MUCCHETTI
Chief, Litigation I.

/s/--------------------------------------------------------------------

RYAN M. KANTOR
Assistant Chief, Litigation I.

/s/--------------------------------------------------------------------

KARL D. KNUTSEN
Attorney, Litigation I, Antitrust Division, U.S. Department of 
Justice, 450 Fifth Street NW., Suite 4100, Washington, DC 20530, 
Phone: (202) 514-0976, Facsimile: (202) 305-1190, E-mail: 
karl.knutsen@usdoj.gov

SHOBITHA BHAT
SCOTT I. FITZGERALD
BARRY JOYCE
MICHAEL T. KOENIG
RICHARD MARTIN
AMBER J. MOREN
PAUL TORZILLI
(DC BAR # 986767)

In the United States District Court for the District of Columbia

    United States of America, Plaintiff, v. Verso Paper Corp., and 
NewPage Holdings Inc., Defendants.

Case No. 1:14-cv-2216

Judge: Tanya S. Chutkan

Filed: 12/31/14

COMPETITIVE IMPACT STATEMENT

    Plaintiff United States of America (``United States''), pursuant to 
Section

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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

    On January 3, 2014, Defendant Verso Paper Corp. (``Verso'') agreed 
to acquire all of the assets of Defendant NewPage Holdings Inc. 
(``NewPage''). The United States filed a civil antitrust Complaint on 
December 31, 2014, seeking to enjoin the proposed acquisition. The 
Complaint alleges that the likely effect of this acquisition would be 
to lessen competition substantially in the markets for coated 
publication papers and label paper in violation of Section 7 of the 
Clayton Act, 15 U.S.C. 18. For each product, this loss of competition 
likely would result in higher prices, lower output, and fewer services 
for customers in North America.
    At the same time the Complaint was filed, the United States also 
filed a Hold Separate Stipulation and Order (``Hold Separate'') and 
proposed Final Judgment, which are designed to eliminate the 
anticompetitive effects of the acquisition. Under the proposed Final 
Judgment, which is explained more fully below, the Defendants must 
divest two NewPage mills that manufacture the relevant products. Under 
the terms of the Hold Separate Stipulation and Order, the Defendants 
will take certain steps to ensure that the assets being divested will 
be operated as a competitively independent, economically viable, and 
ongoing business concern, that will remain independent and uninfluenced 
by the consummation of the acquisition, and that competition is 
maintained during the pendency of the ordered divestiture.
    The United States and 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 proposed Final Judgment and to punish 
violations thereof.

II. DESCRIPTION OF THE EVENTS GIVING RISE TO THE ALLEGED VIOLATION

A. The Defendants and the Proposed Transaction

    On January 3, 2014, Verso agreed to acquire NewPage for 
approximately $1.4 billion. In North America, Verso and NewPage are two 
of the largest producers of coated paper. Verso and NewPage produce a 
range of coated papers, including coated publication papers and label 
paper.
    Verso, a corporation headquartered in Memphis, Tennessee, owns and 
operates two mills, both of which are located in North America.\1\ The 
mills collectively produce a range of coated freesheet web paper, 
coated groundwood paper, and label paper that is sold to customers 
throughout North America. In 2013, Verso had approximately $1.4 billion 
in sales.
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    \1\ In December 2014, Verso closed its mill in Bucksport, Maine, 
which produced coated groundwood paper. In the press release 
announcing the closure, Verso's CEO indicated that the mill has been 
unprofitable for a number of years and that in today's marketplace 
the Bucksport mill would be unlikely to become profitable in the 
future. Press Release, Verso Paper Corp., Verso Announces Closure of 
Bucksport, Maine Paper Mill (Oct. 1, 2014) (available at https://investor.versopaper.com/releasedetail.cfm?ReleaseID=874161). Verso 
contemplated closing the mill before it decided to merge with 
NewPage. The United States does not allege that the closing of the 
Bucksport Mill is a result of the merger.
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    NewPage, a corporation headquartered in Miamisburg, Ohio, owns and 
operates eight mills, all of which are located in North America. The 
mills collectively produce a range of coated freesheet web paper, 
coated groundwood paper, and label paper sold to customers throughout 
North America. Its annual sales for 2013 were approximately $3.1 
billion.

B. The Competitive Effects of the Proposed Acquisition

    1. The Relevant Product Markets are Coated Freesheet Web Paper, 
Coated Groundwood Paper, and Label Paper.
    The Complaint alleges three types of coated paper are relevant 
product markets within the meaning of Section 7 of the Clayton Act: 
coated freesheet web paper, coated groundwood paper, and label paper. 
Coated freesheet paper and coated groundwood paper are both used for 
publications and are typically coated on two sides. Coated freesheet 
paper is made from pulp that has impurities removed before being made 
into paper, resulting in bright, high-quality paper. Coated freesheet 
paper is typically used for annual reports, magazine covers, premium 
magazines, brochures, and direct mail advertising.
    Coated freesheet web paper is produced for use in web printing 
applications. Web printers feed paper rolls through the printing 
equipment rather than individual sheets of paper, as used in sheet-fed 
printing applications. Web printing typically involves different 
equipment and different paper than sheet-fed printing. In particular, 
coated freesheet paper for use in web printing has lower moisture 
content so that heat applied in the printing process does not cause the 
paper to blister. For this reason, coated freesheet paper produced for 
use in sheet-fed printers is functionally not a substitute for coated 
freesheet web paper.
    For customers who choose coated freesheet paper for their printed 
material, web printing is often the more cost-effective choice for 
large print jobs than sheet-fed printing, which typically is more cost-
effective for small print jobs. In response to a small but significant 
increase in the price of coated freesheet web paper, customers who use 
coated freesheet web paper for their print jobs are unlikely to 
substitute to sheet-fed printing or other alternatives in sufficient 
quantity to make the price increase unprofitable. As such, coated 
freesheet web paper is a relevant product.
    Coated groundwood paper is also a relevant product. Coated 
groundwood paper is typically used for the interior pages of magazines 
and catalogues, the covers of low-cost magazines, and other similar-
quality printing applications. In response to a small but significant 
increase in the price of coated groundwood paper, purchasers are 
unlikely to switch to coated freesheet paper in sufficient quantities 
to make the price increase unprofitable because coated freesheet paper 
is typically more expensive, heavier, or has other characteristics that 
are undesirable for coated groundwood applications. Purchasers are also 
unlikely to switch to lower quality paper in sufficient quantities to 
make the price increase unprofitable because lower quality paper 
produces a less appealing printed page than coated groundwood paper.
    Label paper is a relevant product. Label paper is typically made 
from coated freesheet paper. Label paper is coated on only one side; 
the other side is treated with an adhesive for placement on an object 
or surface. Label paper is principally used for two types of 
applications: cut-and-stack labels such as those that appear on canned 
food, and the face paper for pressure-sensitive labels such as those 
that appear on wine bottles. Label paper purchasers require a 
consistently high-quality label because the label is an important 
aspect of a product's brand recognition and therefore sales success. 
The cost of the label, moreover, is typically a small fraction of the 
cost of the product on which the label appears. Because high-quality 
labels are critical to a product's marketplace image and

[[Page 1961]]

are a small part of the product's cost, label paper purchasers are 
unlikely to substitute from label papers to other forms of printed 
information on containers in response to a small but significant 
increase in the price of label paper.
    2. The Relevant Geographic Market Is No Larger than Customers 
Located In North America.
    For each relevant product, the Complaint alleges that the relevant 
geographic market is no larger than North America (defined consistent 
with industry terminology as the United States and Canada). The market 
is defined around the location of customers because suppliers typically 
negotiate prices on a delivered basis with individual customers. As a 
result, suppliers charge different prices to different customers based 
on the customers' location. A hypothetical monopolist of each of the 
three relevant products sold to customers located in North America 
would likely profit from a small but significant price increase. 
Customers located in North America would likely not avoid the price 
increase by engaging in arbitrage. Arbitrage would entail a customer 
trying to avoid the price increase by purchasing products from another 
customer outside the relevant market. Arbitrage is unlikely to occur in 
sufficient quantities to make the price increase unprofitable because 
the end customer would need to pay significant incremental shipping 
costs that would make arbitrage an uneconomical strategy. Arbitrage is 
also unlikely to occur because a customer purchasing through arbitrage 
loses valuable services that producers often provide, such as inventory 
management, just-in-time delivery, warranties, and technical support.
    3. The Proposed Acquisition Will Likely Result In Anticompetitive 
Effects.
    The Complaint alleges that the proposed acquisition will likely 
substantially lessen competition in all three relevant markets. In each 
market, the Complaint alleges that the acquisition will likely increase 
concentration substantially and eliminate significant head-to-head 
competition, leading to higher prices and reduced output. In the coated 
freesheet web and coated groundwood markets, the Complaint further 
alleges that the acquisition will likely cause the remaining 
competitors to accommodate one another's price increases and output 
reductions.
    The proposed acquisition is presumptively unlawful because it will 
increase concentration significantly in the highly concentrated coated 
freesheet web and label paper markets. Market concentration is a useful 
indicator of the level of competitive vigor in a market and the likely 
competitive effects of a proposed acquisition. The more concentrated a 
market and the more an acquisition would increase market concentration, 
the more likely that the acquisition would substantially reduce 
competition. Courts typically measure concentration in relevant markets 
using the Herfindahl-Hirschman Index (HHI). Markets in which the post-
acquisition HHI is between 1,500 and 2,500 are considered to be 
moderately concentrated and markets in which the HHI exceeds 2,500 are 
considered highly concentrated. Acquisitions that increase the HHI by 
more than 200 points and result in a highly concentrated market are 
presumed likely to create or enhance market power.
    In the markets for coated freesheet web paper and label paper, the 
proposed acquisition would significantly increase concentration in 
highly concentrated markets. In the coated freesheet web market, 
NewPage had a 30% market share and Verso had a 20% market share at the 
end of 2013. The post-acquisition HHI would increase by approximately 
1,200 to approximately 3,500. In the label paper market, NewPage had a 
60% market share and Verso had a 10% market share at the end of 2013. 
The HHI would increase by approximately 1,500, and the post-acquisition 
HHI would be approximately 5,300. In the coated groundwood market, 
NewPage and Verso each had a 20% market share at the end of 2013. The 
proposed acquisition would increase concentration by approximately 800 
and result in a moderately concentrated market, with a post-acquisition 
HHI of approximately 2,200.
    Demand for coated publication papers has declined over the last 
several years, and this decline is projected to continue for the 
foreseeable future. Continued declines in demand will likely cause 
inefficient competitors to exit the markets while only cost-effective 
competitors will survive. In the coated freesheet web market, the 
Defendants are two of three firms with cost-effective mills. In the 
coated groundwood and label markets, the Defendants are two of a small 
number of firms with cost-effective mills.
    Products within each of the relevant product markets are 
differentiated. Customers have varying preferences for product quality, 
appearance, and performance. Verso, NewPage, and other producers design 
products and marketing strategies to cater to these varying 
preferences. For many customers of the relevant products, Verso and 
NewPage competed head-to-head for business and represented the two best 
alternatives. For these customers, the acquisition would reduce 
competition because they would lose one of their two best options and a 
less desirable option would become the customer's best alternative. The 
proposed acquisition eliminates this head-to-head competition.
    In addition, the coated freesheet web and coated groundwood markets 
are conducive to accommodating conduct by competitors because a small 
number of producers dominate the industry, and producers regularly 
obtain information from customers about their options and competitors' 
prices and product availability. Remaining competitors would likely 
find it more profitable to follow price increases rather than lower 
prices and risk a competitive response from other firms.
    4. Supply Responses and Creditable, Procompetitive Efficiencies 
Would Not Likely Prevent Anticompetitive Effects.
    The Complaint alleges that supply responses from new competitors or 
expansion by existing competitors are unlikely to be timely or 
sufficient in scope to prevent the reduction in competition likely to 
result from the proposed acquisition. Entry or expansion into each of 
the relevant markets is costly and time-consuming. A competitive 
entrant would need a cost-effective mill. Building such a mill would 
cost billions of dollars, take two or more years to build, and require 
extensive environmental permits to construct. New competitors also 
would need to secure major customers, which often involves lengthy and 
expensive qualification processes.
    Non-North American producers are unlikely to increase imports into 
North America to prevent the likely anticompetitive effects. Overseas 
producers tend to focus on markets that are closer to them where they 
can earn higher margins, rather than selling in the more distant North 
American markets where they pay higher shipping costs. In addition, 
customers require timely delivery, as coated paper is an essential 
input into their final products. Procuring coated paper from overseas 
adds significant lead time, increases the risk of delivery delays, and 
makes more difficult quick correction of quality problems. Also, 
fluctuations in foreign exchange rates pose a challenge to overseas 
producers competitively selling to customers in North America because 
they add substantial risk to long-term relationships.

[[Page 1962]]

    Finally, the Complaint alleges that Defendants cannot demonstrate 
cognizable, merger-specific efficiencies that Verso would pass through 
to consumers in the form of lower prices, higher quality, or better 
service to counteract the likely anticompetitive effects.

III. EXPLANATION OF THE PROPOSED FINAL JUDGMENT

    The divestiture requirement of the proposed Final Judgment will 
eliminate the anticompetitive effects of the acquisition in the North 
American market for coated publication papers and label paper by 
establishing a new, independent, and economically-viable competitor. 
The proposed Final Judgment requires the Defendants, within ten (10) 
days after the Court enters the Hold Separate Stipulation and Order in 
this matter to divest, as a viable ongoing business, NewPage's Rumford, 
Maine, and Biron, Wisconsin, mills, and all associated mill assets (the 
``Divestiture Mills''). The Divestiture Mills must be divested in such 
a way as to satisfy the United States in its sole discretion that the 
operations can and will be operated by the purchaser as a viable, 
ongoing business that can compete effectively in the coated freesheet 
web, coated groundwood, and label paper markets. The Defendants must 
take all reasonable steps necessary to accomplish the divestiture 
quickly and shall cooperate with prospective purchasers.
    The Defendants must sell the Divestiture Mills to Catalyst Paper 
Corporation (``Catalyst''). Catalyst is a forest-products company 
headquartered in British Columbia, Canada. Catalyst operates three 
paper mills, all located in British Columbia. Catalyst makes a variety 
of paper grades across its mill system. At its Port Alberni mill, 
Catalyst produces coated groundwood paper and small quantities of 
coated freesheet web paper. Catalyst does not produce label paper. If, 
for some reason, Defendants are unable to complete the sale to 
Catalyst, they must sell the Divestiture Mills to an alternative 
purchaser who must be approved by the United States.
    The proposed Final Judgment provides that the United States may 
appoint a Monitoring Trustee with the power and authority to 
investigate and report on the Defendants' compliance with the terms of 
the Final Judgment and the Hold Separate Stipulation and Order. The 
Monitoring Trustee would not have any responsibility or obligation for 
the operation of the Defendants' businesses. The Monitoring Trustee 
would serve at the Defendants' expense, on such terms and conditions as 
the United States approves, and the Defendants would be required to 
assist the trustee in fulfilling its obligations. The Monitoring 
Trustee would serve for two years. The United States may, in its sole 
discretion, extend the Monitoring Trustee's term for an additional 
year. The Monitoring Trustee would file monthly reports for the first 
year and annual reports for each year thereafter, or more frequently as 
needed.
    In the event that Defendants do not accomplish the divestiture 
within the periods prescribed in the proposed Final Judgment, the Final 
Judgment provides that the Court will appoint a trustee selected by the 
United States to effect the divestiture. If a trustee is appointed, the 
proposed Final Judgment provides that the Defendants will pay all costs 
and expenses of the trustee. The trustee's commission would be 
structured so as to provide an incentive for the trustee based on the 
price obtained and the speed with which the divestiture is 
accomplished. After his or her appointment becomes effective, the 
trustee would file monthly reports with the Court and the United States 
setting forth his or her efforts to accomplish the divestiture. At the 
end of six (6) months, if the divestiture has not been accomplished, 
the trustee and the United States would 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 divestiture provisions of the proposed Final Judgment preserve 
the competition that would be lost if the proposed acquisition occurred 
without the divestiture. The divestiture will largely maintain the 
existing structure of the relevant markets. The mills to be divested 
produced approximately 940,000 tons of coated publication papers, label 
paper, and other papers, which is approximately the same amount of 
production as Verso currently operates. In addition, the divestiture 
will provide the purchaser of the divested assets with a market 
presence comparable to Verso's current market presence in the relevant 
markets. The purchaser will also obtain production assets that have a 
track record of competitively producing a range of coated publication 
papers and label paper.
    The proposed Final Judgment provides that the purchaser of the 
Biron mill will have the option to procure softwood kraft pulp from 
Verso's Wisconsin Rapids mill through a pulp supply contract. Price 
will be set using a methodology consistent with the methodology that 
Defendants historically have used in setting transfer prices for 
bleached softwood kraft pulp provided to the Biron mill, with 
appropriate overhead costs removed. The Biron mill has a semi-
integrated pulp supply. The mill produces its own mechanical pulp and 
receives softwood kraft pulp from NewPage's Wisconsin Rapids mill, 
which is approximately four miles away, through a pipeline and by 
truck. The supply contract under the proposed Final Judgment will 
enable the Biron mill to sell coated groundwood products at competitive 
prices.
    The proposed Final Judgment also provides that the purchaser of the 
Biron mill will have the option to procure waste and wastewater 
disposal services from Verso. Price will be set using a methodology 
consistent with the methodology that Defendants historically have used 
in setting transfer prices for waste and wastewater disposal services 
provided to the Biron mill, with appropriate overhead costs removed. 
The Biron mill currently shares waste and wastewater disposal service 
with other mills owned by NewPage. The waste and wastewater services 
contract under the proposed Final Judgment will enable the Biron mill 
to sell coated groundwood products at competitive prices.

IV. REMEDIES AVAILABLE TO POTENTIAL PRIVATE LITIGANTS

    Section 4 of the Clayton Act, 15 U.S.C. Sec.  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. 
Sec.  16(a), the proposed Final Judgment has no prima facie effect in 
any subsequent private lawsuit that may be brought against Defendants.

V. PROCEDURES AVAILABLE FOR MODIFICATION OF THE PROPOSED FINAL JUDGMENT

    The United States and Defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least sixty (60) days preceding 
the

[[Page 1963]]

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. In addition, 
comments will be posted on the U.S. Department of Justice, Antitrust 
Division's internet Web site and, under certain circumstances, 
published in the Federal Register.
    Written comments should be submitted to: Peter J. Mucchetti, Chief, 
Litigation I Section, Antitrust Division, United States Department of 
Justice, 450 5th Street NW., Suite 4100, Washington, DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. ALTERNATIVES TO THE PROPOSED FINAL JUDGMENT

    The United States considered, as an alternative to the proposed 
Final Judgment, a full trial on the merits against Defendants. The 
United States could have continued the litigation and sought 
preliminary and permanent injunctions against Verso's acquisition of 
NewPage. The United States is satisfied, however, that the divestiture 
of assets described in the proposed Final Judgment will preserve 
competition for the provision of coated freesheet web paper, coated 
groundwood paper, and label paper in the relevant market identified by 
the United States. Thus, the proposed Final Judgment would achieve all 
or substantially all of the relief the United States would have 
obtained through litigation, but avoids the time, expense, and 
uncertainty of a full trial on the merits of the Complaint.

VII. STANDARD OF REVIEW UNDER THE APPA FOR THE PROPOSED FINAL JUDGMENT

    The Clayton Act, as amended by the APPA, requires that proposed 
consent judgments in antitrust cases brought by the United States be 
subject to a 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. Sec.  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. Sec.  16(e)(1)(A) & (B).\2\ 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. U.S. Airways Group, Inc., No. 13-cv-1236 (CKK), 2014-1Trade 
Cas. (CCH) ] 78, 748, 2014 U.S. Dist. LEXIS 57801, at *7 (D.D.C. Apr. 
25, 2014) (noting the court has broad discretion of the adequacy of the 
relief at issue); United States v. InBev N.V./S.A., No. 08-1965 (JR), 
2009-2 Trade Cas. (CCH) ] 76,736, 2009 U.S. Dist. LEXIS 84787, 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\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for courts 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. 
Sec.  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) (quoting 
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 Commc'ns, 489 F. 
Supp. 2d at 17; see

[[Page 1964]]

also U.S. Airways, 2014 U.S. Dist. LEXIS 57801, at *16 (noting that a 
court should not reject the proposed remedies because it believes 
others are preferable); 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 U.S. 
Airways, 2014 U.S. Dist. LEXIS 57801, at *8 (noting that room must be 
made for the government to grant concessions in the negotiation process 
for settlements (citing Microsoft, 56 F.3d at 1461)); 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 U.S. Airways, 
2014 U.S. Dist. LEXIS 57801, at *9 (noting that the court must simply 
determine whether there is a factual foundation for the government's 
decisions such that its conclusions regarding the proposed settlements 
are reasonable); 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.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments, Congress made clear its intent to preserve 
the practical benefits of utilizing consent decrees in antitrust 
enforcement, adding the unambiguous instruction that ``[n]othing in 
this section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. Sec.  16(e)(2); see also U.S. Airways, 2014 U.S. 
Dist. LEXIS 57801, at *9 (indicating that a court is not required to 
hold an evidentiary hearing or to permit intervenors as part of its 
review under the Tunney Act). 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 
Sen. 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\ A court can make its public 
interest determination based on the competitive impact statement and 
response to public comments alone. U.S. Airways, 2014 U.S. Dist. LEXIS 
57801, at *9.
---------------------------------------------------------------------------

    \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., No. 73-CV-681-W-1, 1977-1 
Trade Cas. (CCH) ] 61,508, at 71,980, *22 (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, 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: December 31, 2014.

    Respectfully submitted,

/s/Karl Knutsen

Karl D. Knutsen

U.S. Department of Justice, Antitrust Division, Litigation I 
Section, 450 Fifth Street NW., Suite 4100, Washington, DC 20530, 
Phone: (202) 514-0976, Facsimile: (202) 305-1190, 
Karl.Knutsen@usdoj.gov.

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA, Plaintiff, v. VERSO PAPER CORP., and
NEWPAGE HOLDINGS INC., Defendants.

CASE NO. 1:14-cv-2216

JUDGE: Tanya S. Chutkan

FILED: 12/31/14

PROPOSED FINAL JUDGMENT

    WHEREAS, Plaintiff, United States of America, filed its Complaint 
on December 31, 2014, the United States and defendants, Verso Paper 
Corp. and NewPage Holdings 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 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 the Defendants to 
assure that competition is not substantially lessened;
    AND WHEREAS, the United States requires Defendants to make certain 
divestitures for the purpose of remedying the loss of competition 
alleged in the Complaint;
    AND WHEREAS, Defendants have represented to the United States that 
the divestitures required below can and will be made and that 
Defendants will later raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the divestiture 
provisions contained below;
    NOW THEREFORE, before any testimony is taken, without trial or

[[Page 1965]]

adjudication of any issue of fact or law, and upon consent of the 
parties, it is ORDERED, ADJUDGED AND DECREED:

I. Jurisdiction

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

II. Definitions

    As used in this Final Judgment:
    A. ``Acquirer(s)'' means Catalyst or another entity or entities to 
whom Defendants divest the Divestiture Mills.
    B. ``Catalyst'' means Catalyst Paper Corporation, a Canadian 
corporation with its headquarters in Richmond, British Columbia, 
Canada, its successors and assigns, and its subsidiaries, divisions, 
groups, affiliates, partnerships and joint ventures, and their 
directors, officers, managers, agents, and employees.
    C. ``Defendants'' means NewPage and Verso.
    D. ``Divestiture Mills'' means NewPage's pulp and paper mill 
located at 35 Hartford Street, Rumford, Maine 04276 (the ``Rumford 
Mill''); and NewPage's pulp and paper mill located at 621 North Biron 
Drive, Wisconsin Rapids, Wisconsin 54495 (the ``Biron Mill'') (subject 
to the exclusions in Section II(D)(3) below), including:
    1. All tangible assets necessary to operate, used in or for, or 
devoted to the Divestiture Mills including, but not limited to, all 
manufacturing equipment, tooling and fixed assets, real property 
(leased or owned), personal property, inventory, reserves, office 
furniture, information technology systems, materials, supplies, and 
other tangible property and all assets used exclusively in connection 
with the Divestiture Mills; all licenses, permits and authorizations 
issued by any governmental organization relating to the Divestiture 
Mills; all contracts, teaming arrangements, agreements, leases 
(including renewal rights), commitments, certifications, and 
understandings relating to the Divestiture Mills, including supply 
agreements; all customer lists, contracts, accounts, and credit 
records; all repair and performance records and all other records 
relating to the Divestiture Mills.
    2. All intangible assets necessary to operate, used in or for, or 
devoted to the Divestiture Mills, including, but not limited to, all 
patents, licenses and sublicenses, intellectual property, copyrights, 
trademarks, trade names, service marks, service names, technical 
information, computer software 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, environmental studies and 
assessments, design tools and simulation capability, all manuals and 
technical information Defendants provide to their own employees, 
customers, suppliers, agents or licensees, and all research data 
concerning historic and current research and development efforts 
relating to the Divestiture Mills, including, but not limited to, 
designs of experiments, and the results of successful and unsuccessful 
designs and experiments.
    3. ``Divestiture Mills'' does not include the Wisconsin Rapids pulp 
mill, the Consolidated Water Power Company, the Sterling trade name and 
trademark, and the NewPage Research and Development facility at 300 N. 
Biron Drive, Wisconsin Rapids, Wisconsin, 54494.
    E. ``NewPage'' means Defendant NewPage Holdings Inc., a Delaware 
corporation with its headquarters in Miamisburg, Ohio, its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships and joint ventures, and their directors, officers, 
managers, agents, and employees.
    F. ``Verso'' means Defendant Verso Paper Corp., a Delaware 
corporation with its headquarters in Memphis, Tennessee, its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships and joint ventures, and their directors, officers, 
managers, agents, and employees.

III. Applicability

    A. This Final Judgment applies to Verso and NewPage, as defined 
above, and all other persons in active concert or participation with 
any of them who receive actual notice of this Final Judgment by 
personal service or otherwise.
    B. If, prior to complying with Section IV and V of this Final 
Judgment, Defendants sell or otherwise dispose of all or substantially 
all of their assets or of lesser business units that include the 
Divestiture Mills, they shall require the Acquirer(s) to be bound by 
the provisions of this Final Judgment. Defendants need not obtain such 
an agreement from the Acquirer(s) of the assets divested pursuant to 
this Final Judgment.

IV. Divestitures

    A. Defendants are ordered and directed, within ten (10) calendar 
days after the signing of the Hold Separate Stipulation and Order in 
this matter, to divest the Divestiture Mills in a manner consistent 
with this Final Judgment to an Acquirer(s) acceptable to the United 
States, in its sole discretion. The United States, in its sole 
discretion, may agree to one or more extensions of this time period not 
to exceed sixty (60) calendar days in total, and shall notify the Court 
in such circumstances. Defendants agree to use their best efforts to 
divest the Divestiture Mills as expeditiously as possible.
    B. Defendants must first attempt to sell the Divestiture Mills to 
Catalyst. In the event that the sale to Catalyst fails, and Defendants 
attempt to sell the Divestiture Mills to an Acquirer(s) other than 
Catalyst, Defendants promptly shall make known, by usual and customary 
means, the availability of the Divestiture Mills for sale. Defendants 
shall inform any person making inquiry regarding a possible purchase of 
the Divestiture Mills that they are being divested pursuant to this 
Final Judgment and provide that person with a copy of this Final 
Judgment.
    C. In accomplishing the divestiture ordered by 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 Mills customarily provided in a due 
diligence process, except such information or documents subject to the 
attorney-client privilege or work-product doctrines. Defendants shall 
make available such information to the United States at the same time 
that such information is made available to any other person.
    D. Defendants shall permit all prospective Acquirers to have 
reasonable access to personnel and to make inspections of the physical 
facilities of the Divestiture Mills; 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, 
except such information or documents subject to the attorney-client 
privilege or work-product doctrines.
    E. Defendants shall provide the Acquirer(s) of the Divestiture 
Mills and the United States information relating to the personnel 
involved in the management, production or sales activities of the 
Divestiture Mills to enable the Acquirer(s) to make offers of

[[Page 1966]]

employment. Defendants will not interfere with any negotiations by the 
Acquirer(s) to employ any Defendant employee whose primary 
responsibility is the management, production, distribution or sales 
activities of the Divestiture Mills. Defendants shall waive all non-
compete agreements for any current or former employee whom the 
Acquirer(s) employs with relation to the Divestiture Mills.
    F. Defendants shall warrant to the Acquirer(s) that each of the 
Divestiture Mills will be operational on the date of sale.
    G. Defendants shall not take any action that will impede in any way 
the permitting, operation, or divestiture of the Divestiture Mills.
    H. At the option of the Acquirer and on terms and conditions 
acceptable to the United States in its sole discretion, Defendants 
shall enter into a Supply Agreement for the sale of bleached softwood 
kraft pulp and a Service Agreement for the provision of waste and 
wastewater disposal services to the acquirer of the Biron Mill 
sufficient to meet all or part of the Acquirer's needs. Price under the 
Supply Agreement shall be set using a methodology consistent with the 
methodology that Defendants historically have used in setting transfer 
prices for bleached softwood kraft pulp and waste and wastewater 
disposal services provided to the Biron Mill (in each case, with 
appropriate overhead costs removed). Defendants shall designate 
employees, other than Defendants' senior managers or employees engaged 
in sales and marketing, to implement any such Supply Agreement and 
shall prevent disclosure of any confidential, proprietary, or business-
sensitive information of the Acquirer(s) to any other employees of 
Defendants except as necessary to implement the Supply Agreement.
    I. At the option of the Acquirer(s) and on terms and conditions 
acceptable to the United States in its sole discretion, Defendants 
shall enter into a Transition Services Agreement based upon 
commercially reasonable terms and conditions. Such an agreement may not 
exceed twelve (12) months from the date of divestiture except as 
approved by the United States in its sole discretion. Transition 
services may include information technology support, information 
technology licensing, computer operations, data processing, logistics 
support, wood purchasing, and such other services as reasonably 
necessary to operate the Divestiture Mills. Any amendments to or 
modifications of the Transition Services Agreement may only be entered 
into with the approval of the United States in its sole discretion.
    J. Defendants shall warrant to the Acquirer(s) that there are no 
material defects in the environmental, zoning or other permits 
pertaining to the operation of each asset, and that following the sale 
of the Divestiture Mills, Defendants will not undertake, directly or 
indirectly, any challenges to the environmental, zoning, or other 
permits relating to the operation of the Divestiture Mills.
    K. Unless the United States otherwise consents in writing, the 
divestiture pursuant to Section IV, or by Divestiture Trustee appointed 
pursuant to Section V, of this Final Judgment, shall include the 
entirety of the Divestiture Mills, and shall be accomplished in such a 
way as to satisfy the United States, in its sole discretion, that the 
Divestiture Mills can and will be used by the Acquirer(s) as part of a 
viable, ongoing business of the production, distribution and sale of 
coated freesheet web paper, coated groundwood paper, and cut-and-stack 
label paper and face sheet for pressure sensitive labels in North 
America. Divestiture of the Divestiture Mills 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 Divestiture Mills 
will remain viable and the divestiture of such assets will remedy the 
competitive harm alleged in the Complaint. The divestitures, whether 
pursuant to Section IV or Section V of this Final Judgment,
    (1) shall be made to an Acquirer(s) that, in the United States' 
sole judgment, has the intent and capability (including the necessary 
managerial, operational, technical and financial capability) of 
competing effectively in the business of the production, distribution 
and sale of coated freesheet web paper, coated groundwood paper, and 
cut-and-stack label paper and face sheet for pressure sensitive labels; 
and
    (2) 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 and Defendants gives Defendants the ability unreasonably to 
raise the costs of the Acquirer(s), to lower the efficiency of the 
Acquirer(s) or otherwise to interfere in the ability of the Acquirer(s) 
to compete effectively.

V. Appointment of Divestiture Trustee

    A. If Defendants have not divested the Divestiture Mills within the 
time period specified in Section IV(A) of this Final Judgment, 
Defendants shall notify the United States of that fact in writing. Upon 
application of the United States, the Court shall appoint a Divestiture 
Trustee selected by the United States and approved by the Court to 
effect the divestiture of the Divestiture Mills.
    B. After the appointment of a Divestiture Trustee becomes 
effective, only the Divestiture Trustee shall have the right to sell 
the Divestiture Mills. The Divestiture Trustee shall have the power and 
authority to accomplish the divestiture to an Acquirer(s) acceptable to 
the United States at such price and on such terms as are then 
obtainable upon reasonable effort by the Divestiture 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(D), the Divestiture Trustee may hire, at the expense of 
Defendants, any investment bankers, attorneys, or other agents, who 
shall be solely accountable to the Divestiture Trustee, reasonably 
necessary in the Divestiture Trustee's judgment to assist in the 
divestiture. Any such investment bankers, attorneys, or other agents 
shall serve on such terms and conditions as the United States approves 
including confidentiality requirements and conflict of interest 
certifications.
    C. Defendants shall not object to a sale by the Divestiture Trustee 
on any ground other than the Divestiture Trustee's malfeasance. Any 
such objections by Defendants must be conveyed in writing to the United 
States and the Divestiture Trustee within ten (10) calendar days after 
the Divestiture Trustee has provided the notice required under Section 
VI of this Final Judgment.
    D. The Divestiture Trustee shall serve at the expense of Defendants 
pursuant to a written agreement, on such terms and conditions as the 
United States approves, including confidentiality requirements and 
conflict of interest certifications. The Divestiture Trustee shall 
account for all monies derived from the sale of the assets sold by the 
Divestiture Trustee and all costs and expenses so incurred. After 
approval by the Court of the Divestiture Trustee's accounting, 
including fees for its services yet unpaid and those of any 
professionals and agents retained by the Divestiture Trustee, all 
remaining money shall be paid to Defendants and the trust shall then be 
terminated. The compensation of the Divestiture Trustee and any 
professionals and agents retained by the Divestiture Trustee shall be 
reasonable in light of the value of the Divestiture Mills and based on 
a fee arrangement providing the Divestiture Trustee with an incentive 
based on the price and terms of the divestiture and

[[Page 1967]]

the speed with which it is accomplished, but timeliness is paramount. 
If the Divestiture Trustee and Defendants are unable to reach agreement 
on the Divestiture Trustee's or any agents' or consultants' 
compensation or other terms and conditions of engagement within 
fourteen (14) calendar days of appointment of the Divestiture Trustee, 
the United States may, in its sole discretion, take appropriate action, 
including making a recommendation to the Court. The Divestiture Trustee 
shall, within three (3) business days of hiring any other professionals 
or agents, provide written notice of such hiring and the rate of 
compensation to Defendants and the United States.
    E. Defendants shall use their best efforts to assist the 
Divestiture Trustee in accomplishing the required divestiture. The 
Divestiture Trustee and any consultants, accountants, attorneys, and 
other agents retained by the Divestiture Trustee shall have full and 
complete access to the personnel, books, records, and facilities of the 
business to be divested, and Defendants shall develop financial and 
other information relevant to such business as the Divestiture Trustee 
may reasonably request, subject to reasonable protection for trade 
secret or other confidential research, development, or commercial 
information or any applicable privileges. Defendants shall take no 
action to interfere with or to impede the Divestiture Trustee's 
accomplishment of the divestiture.
    F. After its appointment, the Divestiture Trustee shall file 
monthly reports with the United States and, as appropriate, the Court, 
setting forth the Divestiture Trustee's efforts to accomplish the 
divestiture ordered under this Final Judgment. To the extent such 
reports contain information that the Divestiture 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 Mills, and shall describe in detail each 
contact with any such person. The Divestiture Trustee shall maintain 
full records of all efforts made to divest the Divestiture Mills.
    G. If the Divestiture Trustee has not accomplished the divestiture 
ordered under this Final Judgment within six (6) months after its 
appointment, the Divestiture Trustee shall promptly file with the Court 
a report setting forth (1) the Divestiture Trustee's efforts to 
accomplish the required divestiture, (2) the reasons, in the 
Divestiture Trustee's judgment, why the required divestiture has not 
been accomplished, and (3) the Divestiture Trustee's recommendations. 
To the extent such report contains information that the Divestiture 
Trustee deems confidential, such report shall not be filed in the 
public docket of the Court. The Divestiture Trustee shall at the same 
time furnish such report to the United States, which shall have the 
right to make additional recommendations consistent with the purpose of 
the trust. The Court thereafter shall enter such orders as it shall 
deem appropriate to carry out the purpose of the Final Judgment, which 
may, if necessary, include extending the trust and the term of the 
Divestiture Trustee's appointment by a period requested by the United 
States.
    H. If the United States determines that the Divestiture Trustee has 
ceased to act or failed to act diligently or in a reasonably cost-
effective manner, it may recommend the Court appoint a substitute 
Divestiture Trustee.

VI. Notice of Proposed Divestiture

    A. If the divestitures required herein are not made to Catalyst 
under the terms of a definitive divestiture agreement previously 
submitted to the United States, then within two (2) business days 
following execution of a definitive divestiture agreement, Defendants 
or the Divestiture Trustee, whichever is then responsible for effecting 
the divestiture required herein, shall notify the United States of any 
proposed divestiture required by Section IV or V of this Final 
Judgment. If the Divestiture 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 Mills, together with full details of the same.
    B. Within fifteen (15) calendar days of receipt by the United 
States of such notice, the United States may request from Defendants, 
the proposed Acquirer(s), any other third party, or the Divestiture 
Trustee, if applicable, additional information concerning the proposed 
divestiture, the proposed Acquirer(s), and any other potential 
Acquirer(s). Defendants and the Divestiture Trustee shall furnish any 
additional information requested, except such information or documents 
subject to the attorney-client privilege or work-product doctrine, 
within fifteen (15) calendar days of the receipt of the request, unless 
the parties shall otherwise agree.
    C. Within thirty (30) calendar days after receipt of the notice or 
within twenty (20) calendar days after the United States has been 
provided the additional information requested from Defendants, the 
proposed Acquirer(s), any third party, and the Divestiture Trustee, 
whichever is later, the United States shall provide written notice to 
Defendants and the Divestiture Trustee, if there is one, stating 
whether or not it objects to the proposed divestiture. If the United 
States provides written notice that it does not object, the divestiture 
may be consummated, subject only to Defendants' limited right to object 
to the sale under Section V(C) of this Final Judgment. Absent written 
notice that the United States does not object to the proposed 
Acquirer(s) or upon objection by the United States, a divestiture 
proposed under Section IV or Section V of this Final Judgment shall not 
be consummated. Upon objection by Defendants under Section V(C), a 
divestiture proposed under Section V shall not be consummated unless 
approved by the Court. Notwithstanding the foregoing provisions of this 
Section VI, the United States, in its sole discretion, may withhold its 
approval of the proposed divestiture of a single Divestiture Mill until 
such time as the United States concludes that it can approve an 
Acquirer(s) for both Divestiture Mills consistent with the terms of the 
Final Judgment.

VII. Financing

    Defendants shall not finance all or any part of any purchase made 
pursuant to Section IV or V of this Final Judgment.

VIII. Hold Separate

    Until the divestiture required by this Final Judgment has been 
accomplished, Defendants shall take all steps necessary to comply with 
the Hold Separate Stipulation and Order entered by this Court. 
Defendants shall take no action that would jeopardize the divestiture 
ordered by this Court.

IX. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, and every thirty (30) calendar days thereafter until 
the divestiture has been completed under Section IV or V of this Final 
Judgment, Defendants shall deliver to the United States an affidavit as 
to the fact and manner of its compliance with Section IV or V. Each 
such affidavit shall include the name,

[[Page 1968]]

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 Mills, 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 Mills, and to provide required information to all 
prospective Acquirers, including the limitations, if any, on such 
information. Assuming the information set forth in the affidavit is 
true and complete, any objection by the United States to information 
provided by Defendants, including limitation on information, shall be 
made within fourteen (14) calendar days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, Defendants shall deliver to the United States an 
affidavit that describes in reasonable detail all actions Defendants 
have taken and all steps Defendants have implemented on an ongoing 
basis to comply with Section VIII of this Final Judgment. Defendants 
shall deliver to the United States an affidavit describing any changes 
to the efforts and actions outlined in Defendants' earlier affidavits 
filed pursuant to this section within fifteen (15) calendar days after 
the change is implemented.
    C. Defendants shall keep all records of all efforts made to 
preserve and divest the Divestiture Mills until one year after such 
divestiture has been completed.

X. Appointment of Monitoring Trustee

    A. Upon application of the United States, the Court shall appoint a 
Monitoring Trustee selected by the United States and approved by the 
Court.
    B. The Monitoring Trustee shall have the power and authority to 
monitor Defendants' compliance with the terms of this Final Judgment 
and the Hold Separate Stipulation and Order entered by this Court, and 
shall have such other powers as this Court deems appropriate. The 
Monitoring Trustee shall be required to investigate and report on the 
Defendants' compliance with this Final Judgment and the Hold Separate 
Stipulation and Order and the Defendants' progress toward effectuating 
the purposes of this Final Judgment, including, but not limited to, any 
breach or other problem that arises under any Supply Agreement or 
Transition Services Agreement that may adversely affect the 
accomplishment of the purposes of this Final Judgment, the reasons for 
such breach or problem, and recommended remedies.
    C. Subject to Section X(E) of this Final Judgment, the Monitoring 
Trustee may hire at the cost and expense of Defendants any consultants, 
accountants, attorneys, or other agents, who shall be solely 
accountable to the Monitoring Trustee, reasonably necessary in the 
Monitoring Trustee's judgment. Any such consultants, accountants, 
attorneys, or other agents shall serve on such terms and conditions as 
the United States approves including confidentiality requirements and 
conflict of interest certifications.
    D. Defendants shall not object to actions taken by the Monitoring 
Trustee in fulfillment of the Monitoring Trustee's responsibilities 
under any Order of this Court on any ground other than the Monitoring 
Trustee's malfeasance. Any such objections by Defendants must be 
conveyed in writing to the United States and the Monitoring Trustee 
within ten (10) calendar days after the action taken by the Monitoring 
Trustee giving rise to Defendants' objection.
    E. The Monitoring Trustee shall serve at the cost and expense of 
Defendants pursuant to a written agreement with Defendants and on such 
terms and conditions as the United States approves, including 
confidentiality requirements and conflict of interest certifications. 
The compensation of the Monitoring Trustee and any consultants, 
accountants, attorneys, and other agents retained by the Monitoring 
Trustee shall be on reasonable and customary terms commensurate with 
the individuals' experience and responsibilities. If the Monitoring 
Trustee and Defendants are unable to reach agreement on the Monitoring 
Trustee's or any agents' or consultants' compensation or other terms 
and conditions of engagement within fourteen (14) calendar days of 
appointment of the Monitoring Trustee, the United States may, in its 
sole discretion, take appropriate action, including making a 
recommendation to the Court. The Monitoring Trustee shall, within three 
(3) business days of hiring any consultants, accountants, attorneys, or 
other agents, provide written notice of such hiring and the rate of 
compensation to Defendants and the United States.
    F. The Monitoring Trustee shall have no responsibility or 
obligation for the operation of Defendants' businesses.
    G. Defendants shall use their best efforts to assist the Monitoring 
Trustee in monitoring Defendants' compliance with their individual 
obligations under this Final Judgment and under the Hold Separate 
Stipulation and Order. The Monitoring Trustee and any consultants, 
accountants, attorneys, and other agents retained by the Monitoring 
Trustee shall have full and complete access to the personnel, books, 
records, and facilities relating to compliance with this Final 
Judgment, subject to reasonable protection for trade secret or other 
confidential research, development, or commercial information or any 
applicable privileges. Defendants shall take no action to interfere 
with or impede the Monitoring Trustee's accomplishment of its 
responsibilities.
    H. After its appointment, the Monitoring Trustee shall file reports 
monthly for the first year and at the end of each year thereafter, or 
more frequently as needed, with the United States, and, as appropriate, 
the Court, setting forth Defendants' efforts to comply with their 
obligations under this Final Judgment and under the Hold Separate 
Stipulation and Order. To the extent such reports contain information 
that the Monitoring Trustee deems confidential, such reports shall not 
be filed in the public docket of the Court.
    I. The Monitoring Trustee shall serve for two years. The Monitoring 
Trustee's term may be extended for one (1) additional year, in the sole 
discretion of the United States.
    J. If the United States determines that the Monitoring Trustee has 
ceased to act or failed to act diligently or in a reasonably cost-
effective manner, it may recommend that the Court appoint a substitute 
Monitoring Trustee.

XI. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of any related orders such as the Hold Separate 
Stipulation and Order, or of determining whether the Final Judgment 
should be modified or vacated, and subject to any legally recognized 
privilege, from time to time authorized representatives of the United 
States Department of Justice, including consultants and other persons 
retained by the United States, shall, upon written request of an 
authorized representative of the Assistant Attorney General in charge 
of the Antitrust Division, and on reasonable notice to Defendants, be 
permitted:
    (1) access during Defendants' office hours to inspect and copy, or 
at the option of the United States, to require Defendants to provide 
hard copies or electronic copies of all books, ledgers, accounts, 
records, data, and documents in the possession, custody, or control of

[[Page 1969]]

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 response to written 
interrogatories, under oath if requested, relating to any of the 
matters contained in this Final Judgment as may be requested.
    C. No information or documents obtained by the means provided in 
this section shall be divulged by the United States to any person other 
than an authorized representative of the executive branch of the United 
States, except in the course of legal proceedings to which the United 
States is a party (including grand jury proceedings), or for the 
purpose of securing compliance with this Final Judgment, or as 
otherwise required by law.
    D. If at the time information or documents are furnished by 
Defendants to the United States, Defendants represent and identify in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under Rule 26(c)(1)(g) of the 
Federal Rules of Civil Procedure, and Defendants mark each pertinent 
page of such material, ``Subject to claim of protection under Rule 
26(c)(1)(g) of the Federal Rules of Civil Procedure,'' then the United 
States shall give Defendants ten (10) calendar days notice prior to 
divulging such material in any legal proceeding (other than a grand 
jury proceeding).

XII. No Reacquisition

    Defendants may not reacquire any part of the Divestiture Mills 
during the term of this Final Judgment.

XIII. 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.

XIV. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire ten (10) years from the date of its entry.

XV. Public Interest Determination

    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' responses to 
comments. Based upon the record before the Court, which includes the 
Competitive Impact Statement and any comments and response to comments 
filed with the Court, entry of this Final Judgment is in the public 
interest.

Date:------------------------------------------------------------------

    Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16.

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United States District Judge

[FR Doc. 2015-00466 Filed 1-13-15; 8:45 am]
BILLING CODE 4410-11-P