United States v. Len Blavatnik; Proposed Final Judgment and Competitive Impact Statement, 24880-24885 [2016-09782]

Agencies

• Antitrust Division
• Department of Justice

[Federal Register Volume 81, Number 81 (Wednesday, April 27, 2016)]
[Notices]
[Pages 24880-24885]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-09782]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Len Blavatnik; Proposed Final Judgment and 
Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation, and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States of America v. Len Blavatnik, Civil Action No. 1:15-cv-01631-RDM. 
On October 6, 2015, the United States filed a Complaint alleging that 
Len Blavatnik violated the premerger notification and waiting period 
requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 
1976, 15 U.S.C. 18a, with respect to his acquisition of voting 
securities of TangoMe, Inc. The proposed Final Judgment, filed at the 
same time as the Complaint, requires Blavatnik to pay a civil penalty 
of $656,000.
    Copies of the Complaint, proposed Final Judgment, and Competitive 
Impact Statement are available for inspection on the Antitrust 
Division's Web site at https://www.justice.gov/atr and at the Office of 
the Clerk of the United States District Court for the District of 
Columbia. Copies of these materials may be obtained from the Antitrust 
Division upon request and payment of the copying fee set by Department 
of Justice regulations.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the Antitrust Division's Web site, 
filed with the Court, and, under certain circumstances, published in 
the Federal Register. Comments should be directed to Daniel P. Ducore, 
Special Attorney, c/o Federal Trade Commission, 600 Pennsylvania Avenue 
NW., CC-8416, Washington, DC 20580 (telephone: 202-326-2526; email: 
dducore@ftc.gov).

Patricia A. Brink,
Director of Civil Enforcement.

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

    UNITED STATES OF AMERICA c/o Department of Justice, Washington, 
D.C. 20530, Plaintiff, v. LEN BLAVATNIK c/o Access Industries, 28 
Kensington Church Street, 4th Floor, London, United Kingdom W8 4EP, 
Defendant.

CASE NO.: 1:15-cv-01631
JUDGE: Randolph D. Moss

[[Page 24881]]

FILED: 10/06/2015

COMPLAINT FOR CIVIL PENALTIES FOR FAILURE TO COMPLY WITH THE PREMERGER 
REPORTING AND WAITING REQUIREMENTS OF THE HART-SCOTT-RODINO ACT

    The United States of America, Plaintiff, by its attorneys, acting 
under the direction of the Attorney General of the United States and at 
the request of the Federal Trade Commission, brings this civil 
antitrust action to obtain monetary relief in the form of civil 
penalties against Defendant Len Blavatnik (``Blavatnik''). Plaintiff 
alleges as follows:

NATURE OF THE ACTION

    1. Blavatnik violated the notice and waiting period requirements of 
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, 15 U.S.C. 18a 
(``HSR Act'' or ``Act''), with respect to the acquisition of voting 
securities of TangoMe, Inc. (``TangoMe'') in August 2014.

JURISDICTION AND VENUE

    2. This Court has jurisdiction over the subject matter of this 
action pursuant to Section 7A(g) of the Clayton Act, 15 U.S.C. 18a(g), 
and pursuant to 28 U.S.C. 1331, 1337(a), 1345, and 1355 and over the 
Defendant by virtue of Defendant's consent, in the Stipulation relating 
hereto, to the maintenance of this action and entry of the Final 
Judgment in this District.
    3. Venue is properly based in this District by virtue of 
Defendant's consent, in the Stipulation relating hereto, to the 
maintenance of this action and entry of the Final Judgment in this 
District.

THE DEFENDANT

    4. Defendant Blavatnik is a natural person with his principal 
office and place of business care of Access Industries, 28 Kensington 
Church Street, 4th Floor, London, United Kingdom W8 4EP. Blavatnik is 
engaged in commerce, or in activities affecting commerce, within the 
meaning of Section 1 of the Clayton Act, 15 U.S.C. 12, and Section 
7A(a)(1) of the Clayton Act, 15 U.S.C. 18a(a)(1). At all times relevant 
to this complaint, Blavatnik had sales or assets in excess of $151.7 
million. Blavatnik is the ultimate parent entity of Access Industries 
(``Access'').

OTHER ENTITIES

    5. TangoMe is a corporation organized under the laws of Delaware 
with its principal place of business at 475 Ellis Street, Mountain 
View, CA 94043. TangoMe is engaged in commerce, or in activities 
affecting commerce, within the meaning of Section 1 of the Clayton Act, 
15 U.S.C. 12, and Section 7A(a)(1) of the Clayton Act, 15 U.S.C. 
18a(a)(1). At all times relevant to this complaint, TangoMe had sales 
or assets in excess of $15.2 million.
    6. LyondellBasell Industries N.V. (``LyondellBasell'') is a 
corporation organized under the laws of The Netherlands with its 
principal place of business at 1221 McKinney Street, Suite 700, 
Houston, TX 77010. LyondellBasell is engaged in commerce, or in 
activities affecting commerce, within the meaning of Section 1 of the 
Clayton Act, 15 U.S.C. 12, and Section 7A(a)(1) of the Clayton Act, 15 
U.S.C. 18a(a)(1). At all times relevant to this complaint, 
LyondellBasell had sales or assets in excess of $12.7 million.

THE HART-SCOTT-RODINO ACT AND RULES

    7. The HSR Act requires certain acquiring persons and certain 
persons whose voting securities or assets are acquired to file 
notifications with the federal antitrust agencies and to observe a 
waiting period before consummating certain acquisitions of voting 
securities or assets. 15 U.S.C. 18a(a) and (b). These notification and 
waiting period requirements apply to acquisitions that meet the HSR 
Act's thresholds, which are adjusted annually. During the period of 
2014 pertinent to this complaint, the HSR Act's reporting and waiting 
period requirements applied to transactions that would result in the 
acquiring person holding more than $75.9 million, if certain sales and 
asset thresholds were met, and all transactions (regardless of the size 
of the acquiring or acquired persons) where the acquiring person would 
hold more than $303.4 million of the acquired person's voting 
securities and/or assets, except for certain exempted transactions.
    8. The HSR Act's notification and waiting period are intended to 
give the federal antitrust agencies prior notice of, and information 
about, proposed transactions. The waiting period is also intended to 
provide the federal antitrust agencies with an opportunity to 
investigate a proposed transaction and to determine whether to seek an 
injunction to prevent the consummation of a transaction that may 
violate the antitrust laws.
    9. Pursuant to Section (d)(2) of the HSR Act, 15 U.S.C. 18a(d)(2), 
rules were promulgated to carry out the purposes of the HSR Act. 16 CFR 
801-803 (``HSR Rules''). The HSR Rules, among other things, define 
terms contained in the HSR Act.
    10. Pursuant to section 801.13(a)(1) of the HSR Rules, 16 CFR 
801.13(a)(1), ``all voting securities of [an] issuer which will be held 
by the acquiring person after the consummation of an acquisition''--
including any held before the acquisition--are deemed held ``as a 
result of'' the acquisition at issue.
    11. Pursuant to sections 801.13(a)(2) and 801.10(c)(1) of the HSR 
Rules, 16 CFR 801.13(a)(2) and 801.10(c)(1), the value of publicly 
traded voting securities already held is the market price, defined to 
be the lowest closing price within 45 days prior to the subsequent 
acquisition.
    12. Section 7A(g)(1) of the Clayton Act, 15 U.S.C. 18a(g)(1), 
provides that any person, or any officer, director, or partner thereof, 
who fails to comply with any provision of the HSR Act is liable to the 
United States for a civil penalty for each day during which such person 
is in violation. For violations occurring on or after February 10, 
2009, the maximum amount of civil penalty is $16,000 per day, pursuant 
to the Debt Collection Improvement Act of 1996, Public Law 104-134, 
31001(s) (amending the Federal Civil Penalties Inflation Adjustment Act 
of 1990, 28 U.S.C. 2461 note), and Federal Trade Commission Rule 1.98, 
16 CFR 1.98, 74 FR 857 (Jan. 9, 2009).

DEFENDANT'S PRIOR VIOLATION OF THE HSR ACT

    13. On August 23, 2010, Blavatnik acquired 133,400 voting 
securities of LyondellBasell. At the time of the acquisition, Blavatnik 
already held voting securities of LyondellBasell. The value of the 
voting securities held by Blavatnik after the acquisition was 
approximately $634 million.
    14. Although he was required to do so, Blavatnik did not file under 
the HSR Act prior to acquiring LyondellBasell voting securities on 
August 23, 2010.
    15. Blavatnik continued to acquire LyondellBasell voting securities 
in August and September of 2010, acquiring a total of 3,270,500 
additional voting securities.
    16. On December 1, 2010, Access, acting on Blavatnik's behalf, made 
a corrective filing under the HSR Act for the August 23, 2010, 
acquisition of LyondellBasell voting securities, and the subsequent 
acquisitions in August and September of 2010. In a letter accompanying 
the corrective filing, Blavatnik acknowledged that the transaction was 
reportable under the HSR Act, but asserted that the failure to file and 
observe the waiting period was inadvertent. Blavatnik also committed 
that he and Access would consult with HSR counsel before making any

[[Page 24882]]

additional acquisitions of voting securities.
    17. On January 4, 2011, the Premerger Notification Office of the 
Federal Trade Commission sent a letter to Access indicating that it 
would not recommend a civil penalty action regarding the August 23, 
2010, LyondellBasell acquisition, but stating that Blavatnik ``still 
must bear responsibility for compliance with the Act. In addition, he 
is accountable for instituting an effective program to ensure full 
compliance with the Act's requirements.''

VIOLATION

    18. On August 6, 2014, Blavatnik, through Access, acquired 
2,818,182 shares of TangoMe voting securities. Blavatnik's voting 
securities represented approximately 29.1% of TangoMe's outstanding 
voting securities and were valued at approximately $228 million.
    19. Prior to acquiring the TangoMe voting securities, neither 
Access nor Blavatnik conducted any HSR review of the proposed 
acquisition or consulted with HSR counsel, notwithstanding their 
commitments to do so made in connection with the LyondellBasell 
corrective filing.
    20. On December 17, 2014, Blavatnik made a corrective filing under 
the HSR Act for the August 6, 2014, acquisition of TangoMe voting 
securities. The waiting period on the corrective filing expired on 
January 16, 2015.
    21. Blavatnik was in continuous violation of the HSR Act from 
August 6, 2014, when it acquired the TangoMe voting securities valued 
in excess of the HSR Act's $75.9 million size-of-transaction threshold, 
through January 16, 2015, when the waiting period expired.

REQUEST FOR RELIEF

Wherefore, Plaintiff requests:
    a. That the Court adjudge and decree that Defendant Blavatnik's 
acquisition of TangoMe voting securities on August 6, 2014, was a 
violation of the HSR Act, 15 U.S.C. 18a; and that Defendant Blavatnik 
was in violation of the HSR Act each day from August 6, 2014, through 
January 16, 2015.
    b. That the Court order Defendant Blavatnik to pay to the United 
States an appropriate civil penalty as provided by the HSR Act, 15 
U.S.C. 18a(g)(1), the Debt Collection Improvement Act of 1996, Public 
Law 104-134, 31001(s) (amending the Federal Civil Penalties Inflation 
Adjustment Act of 1990, 28 U.S.C. 2461 note), and Federal Trade 
Commission Rule 1.98, 16 CFR 1.98, 74 FR 857 (Jan. 9, 2009).
    c. That the Court order such other and further relief as the Court 
may deem just and proper.
    d. That the Court award the Plaintiff its costs of this suit.

    Dated: October 6, 2015
FOR THE PLAINTIFF UNITED STATES OF AMERICA:
/s/--------------------------------------------------------------------

William J. Baer
DC Bar No. 324723
Assistant Attorney General
Department of Justice
Antitrust Division
Washington, DC 20530

/s/--------------------------------------------------------------------
Daniel P. Ducore
DC Bar No. 933721
Special Attorney

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

Roberta S. Baruch
DC Bar No. 269266
Special Attorney

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

Kenneth A. Libby
Special Attorney

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

Jennifer Lee
Special Attorney

Federal Trade Commission
Washington, DC 20580
(202) 326-2694

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA, Plaintiff, v. LEN BLAVATNIK, Defendant.

CASE NO.: 1:15-cv-01631
JUDGE: Randolph D. Moss
FILED: 04/20/2016

COMPETITIVE IMPACT STATEMENT

    The United States, pursuant to the Antitrust Procedures and 
Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files this Competitive 
Impact Statement to set forth the information necessary to enable the 
Court and the public to evaluate the proposed Final Judgment that would 
terminate this civil antitrust proceeding.

I. NATURE AND PURPOSE OF THIS PROCEEDING

    On October 6, 2015, the United States filed a Complaint against 
Defendant Len Blavatnik (``Blavatnik''), related to Blavatnik's 
acquisition of voting securities of TangoMe Inc. (``TangoMe'') in 2014. 
The Complaint alleges that Blavatnik violated Section 7A of the Clayton 
Act, 15 U.S.C. 18a, commonly known as the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976 (the ``HSR Act''). The HSR Act states that 
``no person shall acquire, directly or indirectly, any voting 
securities of any person'' exceeding certain thresholds until that 
person has filed pre-acquisition notification and report forms with the 
Department of Justice and the Federal Trade Commission (collectively, 
the ``federal antitrust agencies'' or ``agencies'') and the post-filing 
waiting period has expired.\1\ The purpose of the notification and 
waiting period is to allow the agencies an opportunity to conduct an 
antitrust review of proposed transactions before they are consummated.
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    \1\ 15 U.S.C. 18a(a).
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    The Complaint alleges that Blavatnik, via an entity he controls, 
acquired voting securities of TangoMe in excess of the statutory 
threshold ($75.9 million at the time of acquisition) without making the 
required pre-acquisition filings with the agencies and without 
observing the waiting period, and that Blatvatnik and TangoMe each met 
the statutory size of person threshold at the time of the acquisition 
(Blavatnik and TangoMe had sales or assets in excess of $151.7 million 
and $15.2 million, respectively).
    The Complaint further alleges that Blavatnik previously violated 
the HSR Act's notification requirements when he acquired shares in 
LyondellBasell Industries N.V. (``LyondellBasell'') in 2010. In August 
and September of 2010, Blavatnik made several acquisitions of 
LyondellBasell voting securities without making appropriate HSR filings 
and observing the required waiting periods. On December 1, 2010, 
Blavatnik made a corrective filing for these acquisitions. In a letter 
accompanying the corrective filing, Blavatnik acknowledged that these 
transactions were reportable under the HSR Act, but asserted that the 
failure to file and observe the waiting period was inadvertent. 
Blavatnik also committed that he would consult with HSR counsel before 
making any additional acquisitions of voting securities. On January 4, 
2011, the Premerger Notification Office of the Federal Trade Commission 
sent a letter to Blavatnik indicating that it would not recommend a 
civil penalty action regarding the 2010 LyondellBasell acquisition, but 
stated that Blavatnik would be ``accountable for instituting an 
effective program to ensure full compliance with the [HSR] Act's 
requirements.'' \2\
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    \2\ Complaint, ] 17.
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    At the same time the Complaint was filed, the United States also 
filed a Stipulation and proposed Final Judgment that eliminates the 
need for a trial in this case. The proposed Final

[[Page 24883]]

Judgment is designed to deter Blavatnik's HSR Act violations. Under the 
proposed Final Judgment, Blavatnik must pay a civil penalty in the 
amount of $656,000.
    The United States and the Defendant have stipulated that the 
proposed Final Judgment may be entered after compliance with the APPA, 
unless the United States first withdraws its consent. Entry of the 
proposed Final Judgment would terminate this case, except that the 
Court would retain jurisdiction to construe, modify, or enforce the 
provisions of the proposed Final Judgment and punish violations 
thereof. Entry of this judgment would not constitute evidence against, 
or an admission by, any party with respect to any issue of fact or law 
involved in the case and is conditioned upon the Court's finding that 
entry is in the public interest.

II. DESCRIPTION OF THE EVENTS GIVING RISE TO THE ALLEGED VIOLATIONS OF 
THE ANTITRUST LAWS

A. Len Blavatnik and the Acquisitions of TangoMe Voting Securities

    Len Blavatnik is a British businessman, investor, and 
philanthropist. In 1986, Blavatnik founded Access Industries 
(``Access''), a private international conglomerate company located in 
New York. Access, in turn, controls multiple entities engaged in three 
primary industries: natural resources and chemicals; media and 
telecommunications; and real estate.
    TangoMe is a California based technology start-up known largely for 
its smartphone application Tango. With approximately 200 million 
registered users, Tango is a messaging app offering free video calls, 
texting, and photo sharing.
    On August 6, 2014, Blavatnik, through Access, acquired shares of 
TangoMe voting securities. Blavatnik's voting securities represented 
approximately 29.1% of TangoMe's outstanding voting securities and were 
valued at approximately $228 million. This exceeded the HSR Act's $75.9 
million size-of-transaction threshold then in effect.
    Prior to acquiring the TangoMe voting securities, neither Access 
nor Blavatnik conducted any HSR review of the proposed acquisition or 
consulted with HSR counsel, notwithstanding Blavatnik's commitments 
made in connection with the 2010 LyondellBasell corrective filing. 
Blavatnik became aware of the missed HSR filing when Access conducted a 
periodic review of the company-wide holdings of TangoMe. After 
discovering the missed filing, Blavatnik promptly made a corrective 
filing on December 17, 2014. The waiting period expired on January 16, 
2015.

B. Blavatnik's Violation of HSR

    As alleged in the Complaint, Blavatnik acquired in excess of the 
$75.9 million in voting securities of TangoMe without complying with 
the pre-acquisition notification and waiting period requirements of the 
HSR Act. Blavatnik's failure to comply undermined the statutory scheme 
and the purpose of the HSR Act. Blavatnik's December 17, 2014, 
corrective filing included a letter acknowledging that the acquisitions 
were reportable under the HSR Act.

III. EXPLANATION OF THE PROPOSED FINAL JUDGMENT

    The proposed Final Judgment imposes a $656,000 civil penalty 
designed to deter this Defendant and others from violating the HSR Act. 
The United States adjusted the penalty downward from the maximum 
because the violation was unintentional, the Defendant promptly self-
reported the violation after discovery, and the Defendant is willing to 
resolve the matter by consent decree and avoid prolonged investigation 
and litigation. The penalty also reflects Defendant's previous 
violation of the HSR Act after pledging to consult counsel in order to 
prevent such violations. The United States expects this penalty to 
deter Blavatnik and others from violating the HSR Act. The relief will 
have a beneficial effect on competition because the agencies will be 
properly notified of acquisitions, in accordance with the law. At the 
same time, the penalty will not have any adverse effect on competition.

IV. REMEDIES AVAILABLE TO POTENTIAL PRIVATE LITIGANTS

    There is no private antitrust action for HSR Act violations; 
therefore, entry of the proposed Final Judgment will neither impair nor 
assist the bringing of any private antitrust action.

V. PROCEDURES AVAILABLE FOR MODIFICATION OF THE PROPOSED FINAL JUDGMENT

    The United States and Defendant have stipulated that the proposed 
Final Judgment may be entered by this Court after compliance with the 
provision of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry of the decree upon 
this Court's determination that the proposed Final Judgment is in the 
public interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date of publication of this Competitive 
Impact Statement in the Federal Register, or the last date of 
publication in a newspaper of the summary of this Competitive Impact 
Statement, whichever is later. All comments received during this period 
will be considered by the United States, which remains free to withdraw 
its consent to the proposed Final Judgment at any time prior to entry. 
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:

Daniel P. Ducore
Special Attorney, United States
c/o Federal Trade Commission,
600 Pennsylvania Avenue NW.,
CC-8416
Washington, DC 20580
Email: dducore@ftc.gov

    The proposed Final Judgment provides that this Court retains 
jurisdiction over this action, and the parties may apply to this Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. ALTERNATIVES TO THE PROPOSED FINAL JUDGMENT

    As an alternative to the proposed Final Judgment, the United States 
considered pursuing a full trial on the merits against the Defendant. 
The United States is satisfied, however, that the proposed relief is an 
appropriate remedy in this matter. Given the facts of this case, 
including the Defendant's self-reporting of the violation and 
willingness to settle quickly, the United States is satisfied that the 
proposed civil penalty is sufficient to address the violation alleged 
in the Complaint and to deter violations by similarly situated entities 
in the future, without the time, expense, and uncertainty of a full 
trial on the merits.

[[Page 24884]]

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

    The APPA requires that remedies contained in proposed consent 
judgments in antitrust cases brought by the United States be subject to 
a sixty (60) day comment period, after which the court shall determine 
whether entry of the proposed Final Judgment is ``in the public 
interest.'' 15 U.S.C. 16(e)(1). In making that determination, the 
court, in accordance with the statute as amended in 2004, is required 
to consider:

    (A) the competitive impact of such judgment, including 
termination of alleged violations, provisions for enforcement and 
modification, duration of relief sought, anticipated effects of 
alternative remedies actually considered, whether its terms are 
ambiguous, and any other competitive considerations bearing upon the 
adequacy of such judgment that the court deems necessary to a 
determination of whether the consent judgment is in the public 
interest; and
    (B) the impact of entry of such judgment upon competition in the 
relevant market or markets, upon the public generally and 
individuals alleging specific injury from the violations set forth 
in the complaint including consideration of the public benefit, if 
any, to be derived from a determination of the issues at trial.

15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, 
the court's inquiry is necessarily a limited one, as the government is 
entitled to ``broad discretion to settle with the defendant within the 
reaches of the public interest.'' United States v. Microsoft Corp., 56 
F.3d 1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public 
interest standard under the Tunney Act); United States v, U.S. Airways 
Group, Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 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.'').\3\
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    \3\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for court to consider and amended the 
list of factors to focus on competitive considerations and to 
address potentially ambiguous judgment terms. Compare 15 U.S.C. 
16(e) (2004), with 15 U.S.C. 16(e)(1) (2006); see also SBC Commc'ns, 
489 F. Supp. 2d at 11 (concluding that the 2004 amendments 
``effected minimal changes'' to Tunney Act review).
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    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).\4\ In 
determining whether a proposed settlement is in the public interest, a 
district court ``must accord deference to the government's predictions 
about the efficacy of its remedies, and may not require that the 
remedies perfectly match the alleged violations.'' SBC Commc'ns, 489 F. 
Supp. 2d at 17; see also U.S. Airways, 38 F. Supp. 3d at 75 (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).
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    \4\ 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''').
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    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, 38 F. Supp. 3d at 76 (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, 
38 F. Supp. 3d at 75 (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

[[Page 24885]]

complaint'' to inquire into other matters that the United States did 
not pursue. Microsoft, 56 F.3d at 1459-60. As this Court recently 
confirmed in SBC Communications, courts ``cannot look beyond the 
complaint in making the public interest determination unless the 
complaint is drafted so narrowly as to make a mockery of judicial 
power.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments, Congress made clear its intent to preserve 
the practical benefits of utilizing consent decrees in antitrust 
enforcement, adding the unambiguous instruction that ``[n]othing in 
this section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. 16(e)(2); see also U.S. Airways, 38 F. Supp. 3d 
at 76 (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.\5\ A 
court can make its public interest determination based on the 
competitive impact statement and response to public comments alone. 
U.S. Airways, 38 F. Supp. 3d at 76.
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    \5\ 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.'').
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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.

Date: April 20, 2016

Respectfully Submitted,

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Kenneth A. Libby
Special Attorney

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

    UNITED STATES OF AMERICA c/o Department of Justice Washington, 
D.C. 20530, Plaintiff, v. LEN BLAVATNIK c/o Access Industries, 28 
Kensington Church Street, 4th Floor, London, United Kingdom W8 4EP, 
Defendant.

CASE NO.: 1:15-cv-01631
JUDGE: Randolph D. Moss
FILED: 10/06/2015

FINAL JUDGMENT

    Plaintiff, the United States of America, having commenced this 
action by filing its Complaint herein for violation of Section 7A of 
the Clayton Act, 15 U.S.C. 18a, commonly known as the Hart-Scott-Rodino 
Antitrust Improvements Act of 1976, and Plaintiff and Defendant Len 
Blavatnik, by their respective attorneys, having consented to the entry 
of this Final Judgment without trial or adjudication of any issue of 
fact or law herein, and without this Final Judgment constituting any 
evidence against or an admission by the Defendant with respect to any 
such issue:
    Now, therefore, before the taking of any testimony and without 
trial or adjudication of any issue of fact or law herein, and upon the 
consent of the parties hereto, it is hereby Ordered, Adjudged, and 
Decreed as follows:
I.
    The Court has jurisdiction of the subject matter of this action and 
of the Plaintiff and the Defendant. The Complaint states a claim upon 
which relief can be granted against the Defendant under Section 7A of 
the Clayton Act, 15 U.S.C. 18a.
II.
    Judgment is hereby entered in this matter in favor of Plaintiff 
United States of America and against Defendant, and, pursuant to 
Section 7A(g)(1) of the Clayton Act, 15 U.S.C. 18a(g)(1), the Debt 
Collection Improvement Act of 1996, Pub. L. 104-134 Sec.  31001(s) 
(amending the Federal Civil Penalties Inflation Adjustment Act of 1990, 
28 U.S.C. 2461), Federal Trade Commission Rule 1.98, 16 CFR 1.98, 61 FR 
54549 (Oct. 21, 1996), and 74 FR 857 (Jan. 9, 2009), Defendant Len 
Blavatnik is hereby ordered to pay a civil penalty in the amount of six 
hundred fifty six thousand dollars ($656,000). Payment of the civil 
penalty ordered hereby shall be made by wire transfer of funds or 
cashier's check. If the payment is made by wire transfer, Defendant 
shall contact Janie Ingalls of the Antitrust Division's Antitrust 
Documents Group at (202) 514-2481 for instructions before making the 
transfer. If the payment is made by cashier's check, the check shall be 
made payable to the United States Department of Justice and delivered 
to:

Janie Ingalls
United States Department of Justice
Antitrust Division, Antitrust Documents Group
450 5th Street NW., Suite 1024
Washington, DC 20530

    Defendant shall pay the full amount of the civil penalty within 
thirty (30) days of entry of this Final Judgment. In the event of a 
default or delay in payment, interest at the rate of eighteen (18) 
percent per annum shall accrue thereon from the date of the default or 
delay to the date of payment.
III.
    Each party shall bear its own costs of this action.
IV.
    Entry of this Final Judgment is in the public interest.
Dated:-----------------------------------------------------------------
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United States District Judge

[FR Doc. 2016-09782 Filed 4-26-16; 8:45 am]
 BILLING CODE P