United States, 60446-60499 [2018-25593]

Download as PDF 60446 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices Washington, DC, and by publishing the notice in the Federal Register on June 4, 2018 (83 FR 25715). The hearing was held in Washington, DC, on August 2, 2018, and all persons who requested the opportunity were permitted to appear in person or by counsel. The Commission subsequently issued its final affirmative determination regarding dumped imports of forged steel fittings from Taiwan on September 14, 2018 (83 FR 47640, September 20, 2018). Following notification of final determinations by Commerce that imports of forged steel fittings from Italy and China were being sold at LTFV within the meaning of section 735(a) of the Act (19 U.S.C. 1673d(a)),3 and subsidized by the government of China within meaning of section 705(a) of the Act (19 U.S.C. 1671d(a)),4 notice of the supplemental schedule of the final phase of the Commission’s antidumping and countervailing duty investigations with respect to China and Italy was given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in the Federal Register of October 22, 2018 (83 FR 53295). The Commission made these determinations pursuant to sections 705(b) and 735(b) of the Act (19 U.S.C. 1671d(b) and 19 U.S.C. 1673d(b)). It completed and filed its determinations in these investigations on November 19, 2018. The views of the Commission are contained in USITC Publication 4850 (November 2018), entitled Forged Steel Fittings from China and Italy: Investigation Nos. 701–TA–589 and 731–TA–1394–1395 (Final). By order of the Commission. Issued: November 19, 2018. Katherine Hiner, Supervisory Attorney. [FR Doc. 2018–25612 Filed 11–23–18; 8:45 am] BILLING CODE 7020–02–P DEPARTMENT OF JUSTICE Antitrust Division United States v. CRH plc, et al.; Response to Public Comment Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 3 Forged Steel Fittings from the People’s Republic of China: Final Determination of Sales at Less Than Fair Value, 83 FR 50339, October 5, 2018 and Forged Steel Fittings from Italy: Final Determination of Sales at Less Than Fair Value, 83 FR 50345, October 5, 2018. 4 Forged Steel Fittings from the People’s Republic of China: Final Affirmative Countervailing Duty Determination, 83 FR 50342, October 5, 2018. VerDate Sep<11>2014 19:32 Nov 23, 2018 Jkt 247001 15 U.S.C. § 16(b)–(h), that one comment was received concerning the proposed Final Judgment in this case, and that comment together with the Response of the United States to Public Comment have been filed with the United States District Court for the District of Columbia in United States of America v. CRH plc, et al., Civil Action No. 1:18– cv–1473. Copies of the comment and the United States’ Response are available for inspection on the Antitrust Division’s website 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. Patricia A. Brink, Director of Civil Enforcement. United States District Court for the District of Columbia United States of America, Plaintiff, v. CRH PLC, CRH Americas Materials, Inc., and Pounding Mill Quarry Corporation, Defendants. Case No. 18–cv–1473–DLF Judge: Dabney L. Friedrich RESPONSE OF PLAINTIFF UNITED STATES TO PUBLIC COMMENT ON THE PROPOSED FINAL JUDGMENT Pursuant to the requirements of the Antitrust Procedures and Penalties Act (the ‘‘APPA’’ or ‘‘Tunney Act’’), 15 U.S.C. §§ 16(b)–(h), the United States hereby responds to the public comment received regarding the proposed Final Judgment in this case. After careful consideration of the submitted comment, the United States continues to believe that the divestiture required by the proposed Final Judgment provides an effective and appropriate remedy for the antitrust violation alleged in the Complaint. In addition, the divestiture has the effect of increasing competitive choices for some customers. As a result of the divestiture, two quarries that previously did not compete—because they were under common ownership— now do. The United States will move the Court for entry of the proposed Final Judgment after the public comment and this response have been published pursuant to 15 U.S.C. § 16(d). I. PROCEDURAL HISTORY Defendants CRH plc and CRH Americas Materials, Inc. (collectively, ‘‘CRH’’) agreed to acquire the assets of Defendant Pounding Mill Quarry Corporation (‘‘Pounding Mill’’), which primarily consisted of four aggregate quarries located in West Virginia and PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 Virginia. The United States filed a civil antitrust Complaint on June 22, 2018, seeking to enjoin the proposed acquisition. The Complaint alleged that the likely effect of this acquisition would be to lessen competition substantially in the markets for aggregate and asphalt concrete that are used in West Virginia Department of Transportation (‘‘WVDOT’’) road projects in southern West Virginia. This loss of competition likely would result in increased prices and decreased service in these markets. Therefore, the Complaint alleged that the proposed acquisition violates Section 7 of the Clayton Act, 15 U.S.C. § 18, and should be enjoined. Simultaneously with the filing of the Complaint, the United States filed a proposed Final Judgment, a Stipulation signed by Plaintiff and Defendants consenting to entry of the proposed Final Judgment after compliance with the requirements of the Tunney Act, 16 U.S.C. § 16, and a Competitive Impact Statement (‘‘CIS’’) describing the transaction and the proposed Final Judgment. The United States published the proposed Final Judgment and the CIS in the Federal Register on July 2, 2018, see 83 Fed. Reg. 30956 (July 2, 2018), and caused summaries of the proposed Final Judgment and CIS, together with directions for the submission of written comments relating to the proposed Final Judgment, to be published in the Washington Post and Bluefield Daily Telegraph from July 2, 2018, through July 10, 2018. The 60day public comment period ended on September 10, 2018. The United States received one public comment. See Tunney Act Comments of the State of West Virginia on the Proposed Final Judgment (‘‘WV Comment’’), attached hereto as Exhibit A. II. 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 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 E:\FR\FM\26NON1.SGM 26NON1 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 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) (explaining that the ‘‘court’s inquiry is limited’’ in Tunney Act settlements); United States v. InBev N.V./S.A., No. 08–1965 (JR), 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 mechanisms to enforce the final judgment are clear and manageable’’). 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 in the government’s complaint, whether the decree is sufficiently clear, whether its 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. Instead: VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 [t]he balancing of competing social and political interests affected by a proposed antitrust consent decree must be left, in the first instance, to the discretion of the Attorney General. The court’s role in protecting the public interest is one of insuring that the government has not breached its duty to the public in consenting to the decree. The court is required to determine not whether a particular decree is the one that will best serve society, but whether the settlement is ‘‘within the reaches of the public interest.’’ More elaborate requirements might undermine the effectiveness of antitrust enforcement by consent decree. Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).1 In determining whether a proposed settlement is in the public interest, a district court ‘‘must accord deference to the government’s predictions about the efficacy of its remedies, and may not require that the remedies perfectly match the alleged violations.’’ SBC Commc’ns, 489 F. Supp. 2d at 17; see also U.S. Airways, 38 F. Supp. 3d at 74– 75 (noting that a court should not reject the proposed remedies because it believes others are preferable and that room must be made for the government to grant concessions in the negotiation process for settlements); 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 government’s prediction as to the effect of proposed remedies, its perception of the market structure, and its views of the nature of the case’’). The ultimate question is 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.’ ’’ Microsoft, 56 F.3d at 1461 (quoting United States v. Western Elec. Co., 900 F.2d 283, 309 (D.C. Cir. 1990)). 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 1 See also 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’’). PO 00000 Frm 00057 Fmt 4703 Sfmt 4703 60447 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 complaint’’ to inquire into other matters that the United States did not pursue. Microsoft, 56 F.3d at 1459–60. As a court in this district 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,2 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). This language explicitly wrote into the statute what Congress intended when it first 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) 2 The 2004 amendments substituted ‘‘shall’’ for ‘‘may’’ in directing relevant factors for a 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). E:\FR\FM\26NON1.SGM 26NON1 60448 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices (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. 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. See also 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’’); S. Rep. No. 93–298 93d Cong., 1st Sess., at 6 (1973) (‘‘Where the public interest can be meaningfully evaluated simply on the basis of briefs and oral arguments, that is the approach that should be utilized.’’). III. THE INVESTIGATION AND PROPOSED FINAL JUDGMENT The Department of Justice conducted an extensive investigation into the proposed acquisition and the proposed divestiture. The Department reviewed business documents, conducted economic analysis, and interviewed a substantial number of customers and actual and potential competitors in the aggregate and asphalt-concrete markets to ascertain whether the acquisition would be anticompetitive. The Department also worked extensively with the State of West Virginia and, in particular, the agency most familiar with the markets at issue, WVDOT, which sets quality standards for aggregate used in road construction and repair and qualifies suppliers of aggregate to bid on WVDOT road projects. Later, the Department VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 thoroughly vetted the potential divestiture over the course of several months, a process that included reinterviewing customers, competitors, and the proposed divestiture buyer, document and data requests, and the retention of an expert geologist. Throughout this process, the Department worked in cooperation with the WVDOT to ensure it was satisfied that the divestiture would eliminate any concerns about the acquisition.3 In the Complaint, the United States alleged that CRH supplies aggregate in Wyoming, Raleigh, Mercer, and Summers Counties in West Virginia (these counties are referred to in the Complaint as ‘‘Southern West Virginia’’). Before being acquired by CRH, Pounding Mill owned two quarries that also supplied aggregate in Southern West Virginia. Without the divestiture, the proposed acquisition would have resulted in CRH owning nearly all of the aggregate quarries that supply Southern West Virginia and would have eliminated the horizontal, head-to-head competition between CRH and Pounding Mill in the supply of aggregate. The Complaint also alleged that the acquisition would raise vertical competition concerns. In addition to aggregate, CRH produces and sells asphalt concrete. Aggregate is an essential input in asphalt concrete. AAA Paving and Sealing, Inc. (‘‘AAA Paving’’), a recent entrant, is the only company that competes with CRH to supply asphalt concrete in Southern West Virginia. Before the acquisition, AAA Paving relied on Pounding Mill to supply the aggregate it needs to manufacture asphalt concrete. The acquisition therefore would have put 3 The Department’s cooperation with WVDOT included seeking and obtaining comments and revisions to the proposed Final Judgment. PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 the quarries that are AAA Paving’s only economically viable sources of aggregate under the ownership of CRH, its competitor in the sale of asphalt concrete. According to the Complaint, if CRH were to acquire its rival’s only economically viable source of aggregate, it would have the incentive and ability to disadvantage AAA Paving by withholding this essential input or supplying it on less favorable terms, resulting in higher prices for the sale of asphalt concrete in Southern West Virginia. Under the proposed Final Judgment, CRH is required to divest Pounding Mill’s Rocky Gap quarry located in Rocky Gap, Virginia (hereinafter, the ‘‘Rocky Gap Quarry’’) and related assets to Salem Stone Corporation (‘‘Salem Stone’’). See Figure 1, below. After a thorough evaluation of Salem Stone, the United States approved Salem Stone as the buyer. Salem Stone is a strong aggregate competitor in markets near Southern West Virginia. Salem Stone has extensive experience producing and selling aggregate, and is familiar with both WVDOT’s approval process and with the surrounding area. As a result, Salem Stone is well-positioned to operate the divestiture assets and provide meaningful competition. The divestiture required by the proposed Final Judgment therefore will preserve, and indeed in some respects increase, competition in the markets for WVDOT aggregate and WVDOT asphalt concrete by establishing a new, independent, and economically viable WVDOT aggregate supplier in Southern West Virginia. The divestiture also will ensure that AAA Paving, CRH’s sole competitor in the supply of asphalt concrete, has an independent aggregate supplier to which it could economically turn. BILLING CODE 4410–11–P E:\FR\FM\26NON1.SGM 26NON1 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices IV. SUMMARY OF COMMENT AND THE UNITED STATES’ RESPONSE A. Summary of WVAGO Comment The State of West Virginia through its Office of the Attorney General (‘‘WVAGO’’) submitted the only comment received in this matter. The comment contends that the proposed settlement will not resolve the competitive concerns the United States alleged in its Complaint because the settlement will not preserve AAA Paving’s ability to compete in the sale of asphalt concrete.4 The comment contends that two companies—CRH and AAA Paving—supply asphalt concrete in the southern part of West Virginia and that if CRH were to acquire Pounding Mill’s quarries, AAA Paving 4 The State of West Virginia currently is litigating an antitrust action against CRH and others in the Circuit Court of Kanawha County, West Virginia. That lawsuit alleged, across the entire state of West Virginia, ‘‘monopolization of the markets for aggregates, asphalt, and asphalt paving as well as unreasonable restraints of trade in those markets.’’ (WV Comment, p. 1.) The United States’ proposed Final Judgment is not intended to resolve these much broader claims, but instead is designed to remedy the anticompetitive effects in a four-county area that would otherwise result from the combination of CRH and Pounding Mill. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 would not have an independent source of supply for the aggregate it needs to manufacture asphalt concrete. (WV Comment, ¶ 1.) The comment also contends that the Mercer Quarry, which CRH acquired from Pounding Mill, is the closest source of aggregate to the southern part of West Virginia.5 (Id. at ¶ 2.) The comment claims that AAA Paving’s next-closest alternative, the Rocky Gap Quarry, is not a viable option for AAA Paving because that quarry is 17 miles away from AAA Paving. (Id. at ¶¶ 5, 10.) The comment further claims that purchasing from the Rocky Gap Quarry would require AAA Paving to incur higher costs for its aggregate, which would make AAA Paving’s asphalt concrete less competitive. (Id. at ¶ 7.) WVAGO’s comment also expresses the following concerns. First, the comment contends that CRH has refused to supply AAA Paving with aggregate on several occasions since it acquired the Mercer Quarry. (Id. at ¶ 4.) Second, the 5 The comment does not define the geographic area it refers to as the ‘‘southern part of the State of West Virginia.’’ The geographic area described in the comment may differ from the four-county area defined in the United States’ Complaint as ‘‘Southern West Virginia.’’ PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 comment claims that when CRH refused to supply AAA Paving with aggregate from the Mercer Quarry, CRH provided AAA Paving with monetary credits to account for the additional trucking costs AAA Paving would incur by having to purchase aggregate from the Rocky Gap Quarry, but that ‘‘CRH will not provide those trucking credits forever.’’ (Id. at ¶ 6.) Finally, the comment contends that AAA Paving’s costs for aggregate have already increased since CRH acquired Pounding Mill. (Id. at ¶ 10.) B. The United States’ Response The United States evaluated WVAGO’s comment, investigated the basis for the claims in the comment, and continues to believe that the divestiture of the Rocky Gap Quarry completely remedies the anticompetitive harm alleged in the Complaint. The proposed Final Judgment secures a structural remedy that fully addresses both the horizontal harm alleged in the aggregate market and the vertical harm alleged in the asphalt-concrete market. The divestiture of Pounding Mill’s Rocky Gap Quarry to Salem Stone creates a new competitor in Southern West Virginia and therefore preserves the competition that would have been lost E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.001</GPH> BILLING CODE 4410–11–P 60449 60450 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices absent the divestiture. Indeed, as discussed in more detail below, AAA Paving views the divestiture as leaving it with more alternative sources of aggregate than it had before the acquisition, because the Rocky Gap Quarry now is a nearby alternative to CRH’s Mercer Quarry. Terry Parks, Vice President of AAA Paving, believes that the Rocky Gap Quarry is a viable alternative to the Mercer Quarry for AAA Paving’s aggregate needs. See Declaration of Terry Parks (‘‘Parks Decl.’’), attached hereto as Exhibit B, at ¶ 6. The comment incorrectly claims that AAA Paving would need to truck aggregate 17 miles from the Rocky Gap Quarry. The Rocky Gap Quarry is 14 miles away from AAA Paving, and only 7.5 miles further away from AAA Paving than the Mercer Quarry. (Id.) Mr. Parks’ declaration directly refutes WVAGO’s claim that AAA Paving would not be competitive in the asphalt-concrete market if it had to purchase aggregate from the Rocky Gap Quarry. (Id. at ¶ 8 (‘‘The Rocky Gap Quarry is a viable alternative to the Mercer Quarry for AAA Paving’s aggregate requirements. To obtain aggregate from the Rocky Gap Quarry, AAA Paving would need to truck aggregate an additional 7.5 miles beyond the distance from AAA Paving’s plant to the Mercer Quarry. I do not anticipate that that additional distance would significantly raise my costs.’’).) Moreover, the allegations upon which WVAGO bases its comment are unsupported and factually incorrect. For example, the comment states that CRH refused to supply AAA Paving with aggregate on several occasions since CRH acquired the Mercer Quarry. (WV Comment, ¶ 4). Mr. Parks, however, confirmed that CRH has never refused to provide AAA Paving with aggregate. (Parks Decl., ¶ 7.) Indeed, according to Mr. Parks, AAA Paving continues to purchase aggregate from the Mercer Quarry and the prices CRH charges AAA Paving have not increased since CRH acquired the quarry. (Id.) Further, VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 while WVAGO alleged that AAA Paving’s costs for aggregate have increased since CRH acquired Pounding Mill, Mr. Parks states that AAA Paving’s costs for aggregate have not in fact increased. (Id.) In addition, the comment states that CRH provided AAA Paving with credits when it refused to supply AAA Paving with aggregate from the Mercer Quarry to account for the additional trucking costs that AAA Paving would incur by having to purchase from the Rocky Gap Quarry, but ‘‘CRH will not provide those trucking credits forever.’’ (WV Comment, ¶ 6.) Mr. Parks, however, explained that while CRH has supplied AAA Paving with discounts (or credits), it was not because CRH refused to supply AAA Paving with aggregate. (Parks Decl., ¶ 10.) Rather, the discounts were a goodwill gesture by CRH, because a major road construction project near the Mercer Quarry was causing significant traffic delays. (Id.) CRH offered to supply AAA Paving from a CRH quarry that is further away and provide AAA Paving with discounts to make up for the additional trucking costs. (Id.) At this point, AAA Paving has not purchased any aggregate from the Rocky Gap Quarry. (Id. at ¶ 9.) Further, AAA Paving and other aggregate customers stand to benefit from the divestiture of the Rocky Gap Quarry to Salem Stone. The divestiture creates competition between the Rocky Gap Quarry and the Mercer Quarry, which previously did not compete because both were owned by Pounding Mill. Prior to the acquisition, the closest competing aggregate suppliers for customers near the Mercer Quarry were located in Lewisburg, West Virginia— over 60 miles to the northeast. Due to the high cost of trucking aggregate, prices for aggregate are often disciplined by the total cost to the purchaser of obtaining aggregate from the next closest quarry, which includes the additional trucking costs of transporting aggregate from a farther quarry. The closer quarry can price aggregate just below the PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 amount the customer would pay to obtain aggregate from the next closest quarry. So, prior to the acquisition, the Mercer Quarry should have set its prices to AAA Paving just below what the Lewisburg, West Virginia quarries would charge, based on their likely transportation costs. After the divestiture, the next closest competitor to the Mercer Quarry is now the Rocky Gap Quarry, which is over 50 miles closer; AAA Paving will need to travel only about 7.5 additional miles to obtain aggregate from the Rocky Gap Quarry. (Id. at ¶ 6). Consequently, the price of aggregate quoted to AAA Paving and other customers from the Rocky Gap Quarry is likely to be lower following the divestiture than it would have been prior to the acquisition. In sum, the divestiture ensures that CRH’s acquisition of Pounding Mill will not result in less competition or fewer alternatives for AAA Paving or other nearby customers. V. CONCLUSION After careful consideration of the public comment, the Department continues to believe that the proposed Final Judgment, as drafted, provides an effective and appropriate remedy for the antitrust violations alleged in the Complaint, and is therefore in the public interest. The Department will move this Court to enter the proposed Final Judgment after the comment and this response are published pursuant to 15 U.S.C. § 16(d). Dated: November 16, 2018 Respectfully submitted, FOR PLAINTIFF UNITED STATES OF AMERICA lllllllllllllllllllll Christine A. Hill Attorney, United States Department of Justice, Antitrust Division, Defense, Industrials, and Aerospace Section, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530, (202) 305–2738, christine.hill@ usdoj.gov BILLING CODE 4410–11–P E:\FR\FM\26NON1.SGM 26NON1 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60451 VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00061 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.002</GPH> EXHIBIT A TO RESPONSE 60452 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 21,2018 Maribcth Petrizzi VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00062 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.003</GPH> Dear Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60453 UNITim STATES DISTRICT COURT FOR TIU: DISTRICT OF' COLUMUIA UNITrm STA n:s (JF Al\:U~RlCA v. CRHPLC Castle Ilubliu, Ireland 900 AshW<lod l'""'""''w Suite 600 30338 and CORPORATION Deferulauts. TUNNK\' ACT COMMENTS OJ!' THE ST ATI~ OF Wl!:ST VIRGINIA action unreasonable restraints oftmde VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00063 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.004</GPH> in 60454 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices the State defendants' unlawful conduct Com!Jiaillt \Vithout part ofthe State's ,;maw<uw pr<)Ccec!'tng,s, the State of West Circuit of the State of\:Vcst cn:ga~~cd entities for West the in lVtereer CRil B, 8, closed, CRll has quarry CRH'sown 5. quarry, unable to obtain aggregate When quarry which is 11 miles a\vay, almost VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 to Frm 00064 traffic. minutes Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.005</GPH> route Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices the 60455 credits CR!I this travel time to 8. CRIJ's ofJustice wtlh<it'liW 9. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00065 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.006</GPH> the 60456 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices it Jud:~mcntbe di~;mm·nw'd VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 meet the standards Frm 00066 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.007</GPH> and in the Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60457 IN THE CIRCUIT COURT OF KANAWRA STATE OF WEST VIRGINIA. e,x rei. PA1'RICK MORRISEY, ATTORNEY and PAUL A. MATTOX, JR. IN H1SOFFICIALCAPACITY AS SECRETARY OF TRANSPORATION AND COMMISSIONER OFRIGIDVAYS, WESTVJ.RGOOA DEPARTMENT OF TRANSPORTATION, v. CRR, PLC; OLDCASTLE, INC.; OLDC.ASTLE MATERlALS,INC.; WEST VIRGINIA PAVING, INC.; SOUTHERN WEST VIRGINIA INC; SOUTHERN WEST VIRGINIA ASPHALT, INC.; KELLY CAMDJ.t.~ l'),"ltnL,. LLC; AMERICAN ASPHALT & AGGREGATE, INC.; AMERICAN ASPHALT OF WEST INDUSTRIES AND EQUIPMENT COMPANY, and and the Paul A. Mattox, Jr. in h.is official this action under th.e West Oldcastle, Inc.; Oldcastle Materials, Inc.; West Antitrust Act Inc.; Southern West inc.; Southern West Inc,; Camden Materials, LLC; American & Aggregate, Inc.; American of West LLC;and EXHIBIT VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00067 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.008</GPH> IPr 60458 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices T!te Circ,uit C,ourt of Kanawha is authorized to hear this matter under Article VUl, SectiM 6 of the West CollStitution, W, Va. Code § 56-3--33, W.Va. Code 51-2-2, W.Va. Code§§ 47-13-8, 9and IS. :l. Defendants transact business in Kanawha Cireuit Collrt of Kanawha \Vest Venue thus properly lies in the See W.Va. Code 56-1-1; see also id. § 47- 18-H, PARTIES 4. Plaintiff: the State of West by and through its General,. Patrick to elected Attorney this action under \Vest §§ 47-18-l!, -9, and-15. 5. Plaintiff, .Paul A. Mattox, in his official is action underW. Va, Code authorized 6. and W.Va. Code 17-2A-It Division of Hi~:llwavs is The West tbr the construction and maintenance of mo.re than 38,000 miles of Annual 7. ronttuc!s awarded and than $665 million. a ron»m.ilon organi:~ed under the laws of Ireland and is Defendant CRH, in Dublin, Ireland. t'RH, Oldcast!e, Inc.; Oldta<>!le DOH in the state is the ullimate owner of its subsidisries, which Include Jnc ..: We.~t Virginia Paving, Inc,; S<1utbern West Paving, Inc.; and Southern West Inc. UIJOn information and CRH, VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00068 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.009</GPH> 2 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices from each of these e:xercises dominion and control over its subsidiaries and reports all entities in 60459 filed mat'Crials company is the information 9. in North America, in all states and six Canadian """''~···A !0. information and is the and the of i~ggreg:~tes and re<~dymixed concrete in the United States. third into CRH, pic's business is IL CRH, pic's business is further aggregates, int1~11ted to into md maintenance demmd in the United States. Defendant "'"";~'u"' Inc. is 12. Delaware; and is h..~.rln••strt••r»rl Oldcastle, Inc.'s actions are controlled and in Atlanta, dominated by op<~atiions UICICI!!t!le. Jne. is rCSIPO!lSibJ in North America. !3. inCI~!Jl!lfllt<ed Defendant O!dcastle IVUil:emtls, Materials owns West Inc. Inc. Defendant West authorized is West oonduct business in the State of Wast wv of business loestcd in Dunbar, West wv information and belief, Oidcastle CRH, actions are controlled md dominated Inc, Oldeastle is h"""'"'"'"''""i in in Delaware; !4. """'""'"'""" of CRH, pic; ill engages in lbe business of manulllctarirtg, in West and/or markets. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00069 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.010</GPH> 3 60460 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices IS. Defendant Southern West West authorized to oonduct business in the State of West of business located in its are the same as WV Southern WV with officers West offic.ers and its "local office" is the same as WV engages in the business and/or in West 16. Defendant Southern West isa authorized to conduct business in the Slate of West West its of business located in are the same as \VV West is the !llllne as WV omcers and its ''local ofi1ce" engages in the business Southem WV and and/or markets. 17. Southem WV information and belief, CRH, SouthemWV subsidiaries are ultimaltei.Y controlled and !8. direeted WV CRH, Southern CRH, to herein as "CRH. and Southern 19. is a West Defendant authorized to conduct business in the engages in the business of and and ventme with WV markets. 20. iu West Virginia aspnlllt·rel1!ltOO Camden Materials LLC. Camden Materials, LLC ("Camden Materials") is a West limited- mthe State of West with its IUltOOrized to conduct business VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00070 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.011</GPH> 4 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices of business located in between WV in Camden Materials is West lnfonnation end belief, Camden Mt~terillls is o>Vl:led and Camden parts by WV Materit~ls engages in tbe business of wv Camden Materials 21. 60461 & Aggregate, Inc. Defendant American authorized m conduct business in the State of American of business located in Kenova, West West & Aggregate engages in the business & Aggregate is information and Dean. owned in whole or in 22. Defendant American ofWest is LLC is ootborized !o Delaware lim!!eti·Hatbilltv company fonned in June 2012. American of business ill located in conduct business in tbe State of West Kenova, West information and belief, American &;A<>t""o"'l" Soutbem WV and American & Aggregate. American American inf(lrmatlon a11d belief, Damn Industries l!llld Equipmtent Cono.nll!IV t"m~,,Jr.,,n y,,..~,.~''""""' Defendrult authorized to oonduet business in the State of West is a West with its engages in tlle md astli!lalt·relliled business of mwnuftlel:l:krill;l!., 23. parts ofbusiness localed in Kenova, West in the business of mm1ufaeturing, and/or Upon infurmation md belief, Industries is a Aggregate, and owned in asphalt and asr!hal.t·rE:lat•Erl of American & by Damn Dealt VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00071 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.012</GPH> 5 60462 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices mines, or at 24, used to mooufacture at 11t1 aggregate quarry, 25, concrete" or or cement (also referred to in the with aggregate. 27. "Hot-mix concrete. The Relevant Product Markets 28. 29, of the 30. costs limit the areas to which aggregate ean be mines, and markets for tbe sale of in or in close to soutbern West must be able to amounts of consistent aggregate in close oroxinlitv to the hot-mix where the VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00072 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.013</GPH> 6 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 34. Environmental and 35. State and local in southern West 60463 proxin1ily to southern in in its 38. Manufacturers 39. Aggregate used for characteristics. 40. No! all aggrecgates are suitable 41. DOH must md aggregate aggregate can be used to manufilcture 42. !bat meets OOH PI'OllU~i!'l! md before the forOOH A current lis! hereto as Exhibit ""' 43. The pro,dueltion and sale of OOH roncrele constitutes a line of rom1Uerce and a relevant market fur antitrust 44. The pro,ducltion md sale of roncrete lba! meets DOH specmca11ons for DOH-contract market VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00073 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.014</GPH> 1 60464 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 45. Establishing a new, successful bot-mix plant in or in close proximity to southern West Virginia is difficult, time-consuming, and costly. 46. To be cost competitive, the hot-mix plant must be able to obtain large amounts of consistent quality aggregate in close proximity to tbe hot-mix plant and be in close proximity to DOH paving projects requiring asphalt concrete. 47. Environmental and zoning pennits must be obtained to operate a hot-mix plant. 48. State and local zoning provisions make it very difficult to open a bot-mix plant in southern West Virginia or southwest Virginia in close proximity to southern West Virginia. 49. DOH must inspect and certify producers of asphalt concrete before the asphalt concrete can be used for DOH paving contracts. 50. A current list of approved asphalt concrete manufacturing plants for DOH paving contracts is attached hereto as Exhibit B. 51. Asphalt concrete is composed of about 95 percent aggregate and 5 percent liquid asphalt. 52. Because asphalt is composed primarily of aggregate, asphalt is heavy and cannot be·trucked large distances because it is prohibitively expensive to do so. 53. Similarly, heat is required to manufacture asphalt, and the finished product must be applied while it is hot. 54. For that reason, the extent to which manufactured asphalt can be transported is limited by the distance and time it takes to deliver the product. Asphalt Paving 55. Asphalt paving is a separate p_roduct market because contractors can acquire paving equipment to apply asphalt manufactured for a DOH paving project without owning or controlling a hot-mix plant or an aggregate producing facility. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00074 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.015</GPH> 8 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 56. 57. or road oonstrocticm Some of the Detendants oceasic)nally win DOH contract bids, and 60465 :from an ind·ependent manufacturer. Oel::asionatlly, when Derendants lnse bids, bidder. The Relevant Geographic Markets 58. is divided into different geographic markets 59. The and markets include the North Market, which is Wetzel, Hancock, Brooke, the 60. ll!ld costs, West For antitrust purposes and due to terrain and transportation t!f ll!ld Pleasants. The West Central Roane, Jackson, and Mason. 61. The Southwest Wayne, Lincoln, Boone, Kanawha, 62. uJ,,,,.,..;,.. .. 63. The South ~urnm,m, Monroe, Meroer and McDowell. Markel is The Northeast Mineral, 64. of the rolltowln~~: oou:ntics: Jcurcrson. lllld Grant. of the r-.n,_,,,;,"' counties: The East Central Webster, Pocahontas, Nicholas, Greenbrier, and 65. The North Central end Lewis. 66, CRH, its subsidiaries, is the succcasfui bidder on the vas! 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00075 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.016</GPH> Markets, DOH VerDate Sep<11>2014 of all 60466 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 67, of all DOH is the successful bidder on the oontract:s in 68, me the successful oontrae!S in the West Central biddetS on the vast Market 69, CRH, voolures, owns or controls all of lhe DOH 70, CRH, ventures, owns or oontrols all except one of South !he DOH 7L ventures, owns or oonlrols all of the DOH CRH, Central 72, Market Market Through the oW1nero1nip or oontrol of!he hot·mlx CRH has obtained market in power that allowllit to exclude oon1pe'tito:rs and/or raise Sou!bwelll and markets, CRHand have obtained mmet power that llllows them to exclude eer,npelitors and/or raise in the Weill Central 74, The relevant goognqllnc area for the purposes of this oo~opl<linl is made up of the Southwest and West Central Markets, The Defoodantll' Acqtuisitkm History 15. CRH has in an series of antiicornpc:titi1re VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00076 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.017</GPH> acQUIS!.noris, agreennenls, and p!llctices since 2000. Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 76, 60467 maintained, and enhanced market power in the Defendants have goo.2m!llllC merkets, marl:et tbr the sale and pr~:luci:lon and exclude conrpetitors tllre•ugb,out CRH has tbe the relevant li:00.!1,111!:lhi<: 78, manutacrure and sale and In 2000, CRH began its quest to control tlle in West via one or more of the acqulsi11ion its subsidiaries, 79, CRH Southern WV and CRH one Sonthem \VV 80, The or more ofi!s subsidiaries in2000, 8L in the manufacture of The and Ohio River thai The ere or have beoo DOH eertified 83. As two DOH 84, As of 2014, The one hot·mix 85, in a press release issued near Ohio. and identified West !lJX!llisitionofThe 86, Market, CRH in 2000, lt announced its $362 million liS one of its three "main mll!tet •H'"'""''"'""' frorn tbe Nortll Since the acquisiitio1a,the Ohio River and aggregate terminals owns severai agg:regate in Weal VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00077 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.018</GPH> l1 60468 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 87. CRH with 88. In 2006, CRH, entered into a joint one if its subsidiaries furm. Camden Materials. venture with 89. ""'"'"''-~' until2006, for DOH byWV Camden Materials is in Parlters:burg,Wood 90. Since the formation of Camden Materials, CRH has not bid on any DOH in the North could with the hot·nlix it and several hot-mix planls owned The its in Parl!ers;burg, in Ohio across the Ohlo River, 9L WM the suceessful bidder on 62 per11e11t of the DOH in the North by dollar amount from continued to bid on DOH After the formation of Camden Materials, in the \\'est Central wiii!CRH. 93. Camdan Materials. since 2006, even 94. in Mason bas not bid on DOH information and In the West Central market, CRH won 41 percent of the DOH while 37 2014. 95. CRH and 80 96. Before June 20!2, Amerie!ln and CRHtbrOOH 97, American In June of 2012, American AS!l!blll!~ CRH·owned & Aggregate and formed. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00078 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.019</GPH> 12 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices Sin~e 60469 venture, Ameriellll the funnalion of the AmeriC!l!l ~rnpeting with CRH in the West Centml Market for DOH 99. Industries has failed Since 2013, ro win a bid in the Southwest Market, although it won bids in this market befure lhe formation information and belie!~ as a part of the 100. & Aggregate shuttered two of its CRH and also 101. venture agreement, American that had compete, nr"vi"'''~lv ~ntpeted Industries. in 20!4, CRH's n1arket share for DOH From 20HJ Market bas increased fu>tn about 60 percent to about 93 percent by dollar the Southwest volume, an asnhalit·and·navillll' 102. won a $3,6 million contmct to pave Lenore, the Ul3, m2oto. information and 105. after the acquisi1:ion, App,alachian CRH ronl!'lcr'ly <:OtlliPI:Teowith Mountain a group owned in the Southwest lllld West Centml Markets. 106. In 2006 CRH Mountain Co1np;uties, its Oldcastle Materials subs;idiacy and others. Hl7. Mountain Enterprises, one of the Mountain Comp:mh:s, dominated v.rv the southern rounties oflhe Soulh\\>'ellt in Market VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.020</GPH> 13 60470 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices it 1OS, Rather than 109, As part ofthat acqutstltlon, CRH also Inc., a 001npany owned by Mountain CoJlJpanies with BiL:l'..ack, Inc., 110, MollllliaJn GomJ:IIllli~~s' owners. owned the assets of Orders & Upon information and Co., Inc. HL in competition to CRR Southwest 112. 13, formed paving services in !he Orders & information and was information and a former Vice President ofWV Paving, 14. the assets of Yellowstar CRH later Dumnire, compete with CRH information and belief, Yellowstar had the for DOH 115. information and Yellowstar and threatened the oompuny, to Yellowstar, 116, information J,,se CRH business. for Yellowstar or m. ll!t not haul CRH also thteatened CRH's threats worked, inrormation and belief, Yellowsm submitted and sold its assets to Yellowstar's hot-mix !19, tomdo\l!n, VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.021</GPH> 14 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices was forced to information and belief;, Yellowstar's owner, !20. MAC Construction showed early success in outlbid(linll WV 122. DOH 60471 on two large in 2014. 123. after Upon information and belief, the bids in 2014, CRH to opemte a hot· in St. Albans, West mix 124, CRH pUI'!)Ol!efidly took actions to maintain and enhance its market power in the markets actions. information and belief: CRH: (a) its oon~peltltol·s; induced thn:atened to put new OO!l'tpe!iltors out of business; (c) mnde """"""'""" and mandated statewide oovetan!s not to oompe!e, for as many as tell years, from i!!! vmquil>hed bnsiness rivals. 126. consider CRH bas created substantial barriers lo !bose who 127, CRH has restricted the information and the concrete to ceased o!)l:ratiions or sold to CRH; and VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00081 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.022</GPH> 15 60472 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices ec:c•oolnically irrational for MY\llle production or to consider launcb:ing markets. bu<:ine:!l!es in lhe West Central, Soulhwest and Soutb The Dd'elltbnts' :Market Power 128. markets, v.T!etber measured in the relevant won/subcontracted !29. concrete and CRH bas dominant market power for DOH DOH contracts concrete sold. total CRH operates all the DOH oorr>plianl hot-mix in the South Market. 130. In the South: Market from 201Q to 2014, CRH's market share for DOH l 00 percent, as measured in dollars. increased from 90 percent to !32. CRH the overall lime 13!. 95 percent of the market share, four con1petiitors to CRH in the South During the same time River Construction, Inc,.; Triton Construction lnc.; Ahern & Associates, Inc.; on DOH contracts or failed to win DOH contracts, information and belief, CRH's COlll'lpetito•rs could no 133. DOH- from CRH at corrtpe!itive 134. CRH operates all the DOH comtpliant hot-mix in tbe Southwest Aspbatt Market VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.023</GPH> 16 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 135. Market, from 2010 to 2014, CRH's market share for In the Southwest DOH 60473 increased from about 60 percent to about percent, as measured in dollars. the overall time 136. 79 percent of the market share, CRH which totaled $87,292,926.00 in contracts. m. of time, three coropctito,rs to CRH in the Southwest the same market~MAC Construction & ElU;)l!V;atin:g; lndustries; and Al:ltlai!IC!l:lan & Aggregate.- contn'lcts. information and 138. & CRH fl.l!l~Tt:Eiil<ll, 139. venture with Rllu•lr·t""'• owner, Daron Dean. CRH information and belief, ll fuurlh 140. c~tnpe:tito,r, Alan Stone Co, Inc., could no from CRH at contracts in the Southwest DOH 14t on Market. venture it formed will! CRH and the opernte all the DOH compliant 142. and ln the West Centrnl in !he West Central Market Market from 2010 to 2014, CRH's 1Ullrkct share for increased from a low of about i 5 percent to about 48 percen!, as measured DOH in dollars, 143. In the West Central Markel ftom 2010 to 2014, market share increased ftom a low of about J8 percent to 42 percent, as measured in dollars. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00083 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.024</GPH> 17 60474 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices in the West Centml the nvemll time !44. CRH and combined, controcts. 145. Upon intbrmatinn and after Camden Materials, CRH and each other in the West Central !46. Market. nf time, two competitors to CRH in !he West Central During the sll.nle 1ndustries and DOH contracts or have failed to win any uvn·••w••un 147. CRH formed 148. infonnation and or Cll.nlden Materials at ~'"'"""'''''"" on DOH and contracts. market share for Market from 20!0 to 2014, in the North increased from a low of about 48 percent to about 72 percent, as measured DOH indollm. ISO. the overall time share in the North 62 percent of the market which totaled $23,415,125.00 in contrac:ts. Hxcavaitlnlland J.F. Allen Cmnn!mv·-stonJned market-Ohio-West DOH contracts or failed to win 152. Two i}tber 153. on contracts. con~pelito:!'l\ Market: Lash North Paving in the North two co11npetitors to the s1une time lSI. continue to hid and win DOH contracts in the Bros, Inc. Inc. and Lash has aboutl2 percent ofthc market while about 7 percc.nt. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.025</GPH> 18 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 154. its subsidiary, The it COUld SUOet\S!>ful1iy CRH has information and OW!IS or controls all of the DOH in the West Central, Southwest and South hot-mix !56. not to bid on Market. CRH contracts in the North DOH oontreels in the North CRH does not bid on DOH 155. 60475 Markets. its hot-mix of DOH CRH can control and paving opemti<ms. I 57. CRH oan refuse to sell to competitors or increase the con~pedtorscan't to the point where its win DOH The Defendants' Condnct Adversely Affects the Markets CRH's' in the relevant geograJ~llie mru·kets. constrained 159. CRH's have been believe a DOH will cost when hut estimate what DOH forbids, post l6 I. and for DOH cqnstrained 16(1. have not beeo and fur DOH DOH cnJl:lneers use past contracts to These are known as determine what future be, estimates, 162. Thus, ifbids for DOH 163. DOH does not lhe engiineering eslitnat~:s, 164. From 2010 5 of about 425, 2014, DOH contracts in the South, Southwest and West Central Markets. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00085 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.026</GPH> 19 60476 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices !.65. DOH ffl~•quentl) m1lS! accept the contract bids that exceed "'"''"'"'"'"" estimates due to the 166. eon~peltition, are tbr the such as Due to the lack of ootnptltih.on, the costs per ton for DOH asphall constrained n!gardle:ss of the oosls of the and labor. aggregate, 167. will rise for DOH Thus, over time, the increased from about $83 to $87 per ton in 2010 to $102 to $110 per ton in 2014 in the South, Markets. Southwest and West Central 168. Market, where the market is divided In contrast, in the Northeast among five or more cornP<~Iit(ltS--irrcltlditlg asphalt increased from $73 to $84 per the market-from which has about 19 percent of the ton, 169. thus, was almosl double in tlu: The increase South, Southwest and West Centrlll Markets as cornparod to the Northeast M!l!kct. 170. The accelerated increase per ton C!I!Uiol be DOH ant,m•vert the 17 L Market, from 20l(}-t4, CRH was the aolc bidder on 63 of In the South 72DOH 172. Out of ali 72 ccn!racts in the South there were one or two bidders on 97 percent of the ccntrncts. m. the South 2013, CRH was about 95 pereent of all the DOH contracts in Market VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00086 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.027</GPH> 20 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 174. 60477 Market, from 2010-!4, CRH was the sole bidder on In the Southwest 113 of248 DOH 175. Out of all 248 c-Ontracts, there were one or two bidders on 95.5 percent of the contracts. 2013, CRH was 176. about 95 percent of all the DOH contracts in Market. 177, ln the West Central contracts. 12 of105 DOH 178. Out of all 105 contracts, there were one or two bidders on 63.4 percent of the contracts. 179, CRH and 180. to Thus, in the able to raise the the DOH contracts. Southwest and West Central of DOH Markets, CRH has been services to supra· and oo connpetiti~>n in tl!ose markets, cornpe,titi>>'e levels beeause it has had 181. Market is where However, upon information and belief, the West Central for DOH has The Stale of West to its detriment in the South, Southwest and West Central markets. Anl~ieolmPt,titi•re 182. The State has suffered Effeets: and DaJnaa:es to its welfllre and eennomy due to !he unlawful actions ofDerendants. 183. The State will be contintling threat of injury to its welfamand from ~.-or;timling tl<.m;¥ "n1 ~'""'' 1 conduct. economy un!esa Defendants VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00087 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.028</GPH> 21 60478 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 184. bus market power but bus used it to cause DOH and CRH not West payers ernlrmous 185. The DOH in an anwunt to be determh1ed, from 2010 ovc:rchlll'!l!OO on !he South, Southwest and West Central 2014 in M!lrkets. Due 1o Defendants' un!a\'iful conduct, the cost DOH services may have been amncJallv hlfiated in the South, Southwest and West Central M!lrke!s ina m!lrket 187. in 2010 to be about 2,260,000 tons of DOH DOH in tire relevant """'"""''''"~ mllrkets. oontmcts from 188. thlill it would have been services in West prices for The bus s:eoondazy, and more delrimen!lll, The State may be forced to either to fioonce its road «<nomic construction and maintemmce is strained. As the West Hi£dlwavs observed in 20 Hi: Blue Ribbon C~1nmislllon on compensate for stag:nlllll state lllld federal revenues, the when a WJlfVH has Increased the for 30 years, will no! be ronsiders those roads with the 1nost use to be !he However, because and might h«W~ to Blue Ribbon Cornmission on berome in West ili··"'"·'"'• I (anpbusisadded). VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.029</GPH> 22 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 189. The Stale 60479 by reference and forth herein. 190. the Catnden Materials Before CRH end venture, each other for DOH l9L seller. Ill'! as part of the agrcen1ent to form Catnden Materials, 192. Paving not to bid endCRH Centtal Market and conttacls in the North not to bid on DOH CRH with each other to fOrm Camden end CRH and Matket. 193. as part of the fonnation of Camden Materillls CRH and Markets for DOH divide the North and West CeJlttal 194. to to information and belief Camden Materials has refused to sell DOH ofCRH and have mmtufa:ctulillR and sale 1narket lllld the DOH resttalned trade in the DOH violation ofW.Va. Code§ 47·~18-3. had !he and DOH forOOH hml the for DOH VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.030</GPH> 23 60480 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices in the West Central Market in violation ofW. Va. Code§ 47-18-3. 198. As a direct result of the oontsoil'I!CV between CRH, Camden Materials lllld the otherwise would have boen eontracts and DOH for DOH connne.!.l!lrnl than had been unrestrained in the West Central Market in violation ofW. Va. Code§ 47-!8-3. Restraints of trade In violation Code§ 47-18-3 (Against CRB, Amerlean Asphalt, American Asphalt & Aggregate and Blacktop Industries) by reference and 200. !he American Before CRH and American contracts in !he West Central each other for OOH venture, 11!1d Sm.tthwcsl Mvkets. and 0011sni.red with each other lo form American Industries company. manufacturer, sellcr·and 202. intbrmatlon and belief, as part of the agreement to furm American not to bid on DOH contracts in the West Central and Southwest Markets or to Southwest 20:t CRH and Dean, as the Southwest and West Central furmation of American Markets for OOH paving contracts. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.031</GPH> 24 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60481 and .Dem have mw~ufll<ctu:ring restrained trade in the OOH 205, and sale ood the OOH The ronspil:acy between CRH, American effect of for OOH in the Southwest ood West Central 206. Mlltkets, The oonspitacy between CRH, Americoo for DOH and DOH in the Southwest and West Centml Markets in violation ofW. Va. Code§ 47-!8-3, 207, the As a direct result of the conspiracy between CRH, Americoo fur DOH and DOH than they otherwise would have been if L'Ornpetiti<m had been unrestrained in the relevant geogmjllltc in violation ofW. Va. Code§ 47-18-3, market!! in West COUNT III Monopolization in Violation ofW, Va. Code§ 47-18-4 (Aga.inst CRH) 208. as The Slate lnco•rpoJrates reference and sel forth herein. or attempt to main!llin its manufacture and sale of markets in West mo:nopclii~e a of the trade or commerce in the part ronerete in the relevant geogfli,Jlhic of DOH in violation ofW . Va. Code§ 47-18-4. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00091 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.032</GPH> 25 60482 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices part of the unlawful monopoly and the pU!JIDSe thereof to acC1Jm~1lish the 210, II (a) To create and maintain a monoll•olv in the sale of DOH (h) To oontrol and affect the 21L in West of the unlawful monopiOlyand in furtherance and maintenance thereof, CRH did: in or near West lhc (c) and will continue lo be for DOH all in violation ofW, Va, Code 41-18-4, Monopolization in Va. Code§ 47-18-4 (Against ClUI) reference as set forth herein. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00092 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.033</GPH> 26 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60483 maintain its mo:nonolv. or attempt to monot:;olilte the market for DOH in violation ofW, Va. Code§ 47- 215. It was a part of the unlawful mo,nopolv and the puqlose thereof to acoom~1!ish the To oreale and maintain a mOilOpoly in market for DOH approved services in West To oontmland affect price of DOH paving services in West (c) the market for DOH (d) 216. As part of the unlawful monO):Ioly tmd in furthemnce and maint<mance thereof~ CRH did: (a) :m. As result of the tonlgo:ing, tile State bas been and wiU continue lo be paving servkes 111 non- because it is conlpellled lo for DOH all in violation ofW. Va. Code§ 47-18-4. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.034</GPH> :n 60484 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices Attempt to l\i~onOilOliz~ In (Against CRB) 218. The Slate incorp•Jra!es 219. CRH a oontmlling interest in WV, Inc. in 2002 by forming venture between Aggregates of West Southern WV Paving named 221. aggregate suitable fbr DOH Four other in !be South and Southw~1 222. is (lwned Va. Cod~ for DOH Markets. Three ofthe a company unrelated lo CRH 223. limestone suitable tbr use in DOH Two of the CRH for DOH Market to contpetiiti'll(lly 224. The third CRH quarry sandstone which is not suitable for DOH CRH 225. Southwest and Soutb three more would Markets, it ownership or control over four of the five limestone aggregate to serving tbe Soutb and Soutbwest VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00094 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.035</GPH> 28 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 226. Atler the CRH would possess suffi<.:ient market power to increase the aggregate !llld maintain its market power for DOH Southwest and South in the Markets. After the acqllisiltion, CRH oould further refuse to 221. 60485 aggregate and DOH approved m!lllufacturers and tbe 228. aggregate or DOH en!r!lllls to guarantee the foreclosure of new would in the South and Southwest markets, and llllow CRH to exercise and maintain its 229. !t V!ill own or c,ontml at least 4 of 5 lfCRH aggregate ftn use in DOH thai can the South and Sollthv<est Markets. CRH would create a dom.inMI aggregate 230. oomp~~ny in the Southwest !llld South 23 L Markets. would reduce the number of The !llld from two to aggregate facilities in these markets from three to two, for DOH one fur DOH This would allow CRH to cement its hold on DOH 232. in the Markets. Southwest Md South 233. wl:!ieh opemtes the West the West costs Because ofthe ,,...,,.,.,,.... ,,"" il will be commenced any new quarry produ~:ing aggregate suitable for DOH in or in close 234. the South or Southwest With oontml of four of of the five sources for DOH CRH will be able to exercise markt1 power 10 contml !he aggregate, of aggregate and exclude VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00095 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.036</GPH> 29 60486 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices aggregate in the South and Southwest Markets tn violation ofW. Va, Code§ 47···11!-4, 23:5. aggregate market, CRH will further maintain With control of the DOH am! cement ita monopoly over DOH Southwest Markets in violation Code§ 47-18-4. CRH must be enjoined from 236. unlawful in the South and and •ux•mnm• of DOH the Pounding Mill to prevent the aggregate in the South and Southwest Markets pursuant toW .Va, Code § 47-18-ll. (Against. All Defendants) reference and "~'"'"'~'nh• es 238. set forth herein. Defem:lants' ronduel was undertaken with the l!lid for levels. law~. violations 240. The State conferred a benelil upon Defend:Mts for in the relevant "'"'""'''"'" 241. Defendllli!s' conduct conferred a benefit upon themselves at lhe expense of the Stale. Defendl!lits were aware of the benefits conferred the State on them, and those conferred by Defendants upon themselves. Those benet1ts came at State. Defendants have VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.037</GPH> Slllte. Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 242. 60487 lt would be ine<lui!<able to allow Defendants to retain !hose benefits ron,sidering Defendants' behavior in Plaintiffs, State of West and the Department that !his Court grant them !he tf>ll•">wi'~" citizens: 1. Old Castle, inc., Old Castle That the Court and decree that CRH Defendants have maintained their for DOH in the South, Southwest and Code§ 2. West 4. That the Court and decree that CRH Defendants have to monoTJ!olll'e the market for DOH in the Southwest and West Markets, in Code§ 5. That the Court and decree that CRH Defendants have tnde and rommeree the market for DOH approv•*d the South, Southwest and West Central Code 41~18-4; 6. 1'hat the Court and decree !hat CRH Defendants have maintained !heir monoj:roly i.n the for DOH services in the South, :SO\Ltlt\'I'CSt and West Central of W.Va. Code§ 4718-4; 7. That the Court and decree that CRH Defendants have au~ano1~:U mono}loli:ze the DOH services in the Sowlhwclsl and West Central of W.Va. Code§ 4it~ That the Court 9. and deeree !hat CRH Defendants and tnde in the market for DOH Markets in violation That !he Court and deer~ that CRH Defendants and cortsptred to restrain trade in the market for DOH VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00097 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.038</GPH> 31 60488 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices Markets in violation of W.Va. services in the West Central and North Code 47-18-3; 10. in conspired to West Central and § 47-18-3; IL 111at the Court and decree that CRH Defendants and Dean Defendants have to restrain tmde in !he market for DOH services in the West Central and Southwest W.Va. Code§ 47··18~3; 12. 111at !he Court order that all Detendants be permm1ent!y in violation of the West Antitrust Act; 13. Enter an Order Defendants directors from acqtui~:ing, ma.intl!inilng, increasln.~. suppress, eliminate, or exclude or to decn.lase, or stabilize mtes, or fees for or service, or otherwise or with any other or person to achieve the same resull; 14, Enter an Order res1:rair1ing and nreventin11 affiliates from Pm.,ulinn 1S, 111at the Cotlrt three times the amount of Defendants' violations of the West 18-! et seq.; 16. Enter an Order in favor of the State and relief but not limited to div,~stil:nre of all assets neeessary to restore m11Jnutaet1~nrtg and and from any aU Defendants and restitution, to the DOH mll!kets ln the dlsi~Ofl[lerrteot 17. all Defendants lo Antitrust Act; 18. all En!er an Order pursuant to W. Va. Code Defendants to all of the State's costs nec""'"'"n"' the of this action, including "'tt'""'""'' OOT!Slll'Hng experts; and VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00098 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.039</GPH> 32 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 19. 60489 Grl!llt the State such other and further relief !hat the Collrl deems nocessary or STATE OF WEST VIRGINIA, ex ret PATIUCKMOR:!USEY, ATIORNEY GENERAL and PAUL A. MATIOX, JK IN HIS OFFICIAL CAPACITYAS SECRERETARY OF TRANSPORTATION AND COM}v11SSIONER OF HIGHWAYS, WEST VlRGINIA DEPARTM.I!'NT OF TRANSPORTATION Post Offiee Box 1789 Cbarleston, WV 25326-1789 VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00099 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.040</GPH> 33 VerDate Sep<11>2014 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00100 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.041</GPH> 60490 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60491 Th~ followingsuur~e~ have bot~~mted "A·1" lllattorl!an(e wiUI MP 71ltl.llll.S:l. Tills !jjtl$ pullUslied lll<tlltlily, 1111d If necmary, 11mendtd as addillonallllfllrmall<>n lleeomu availal!le. Cllmpany Short Gap, WV AACt0!.7114 • Allegbeny Aggngalos Bel:kley,WV -SACUl,704 • AjlplllaGIIiall Aggregates --BACUlU!l4 • Appalaclllall Aggregaltl L¢wlsburg, WV IACUJ.764 • Appalacllillrl Aggregatts Mlll'l'eln!,WV CLCU3.'11l4 • Carmeus.: Lime Mnysv!lle,KY FMCUl.7M- Fairfax Materials Arthur, WV FMCUl2.11l4 ·Fairfax Maltrialt ~berr,WV GICU1.71l4. Greer lndustrli!S Gtrmany Valley, WV IQCI.Ill.'164 ·Inwood Quarry fnwood,WV .fFA::UI!.7tl4 • ,T F Allen Company Melley Gap Quarry, "-'V JFI\l.lll.71l4 • J F Alle11 Comp1111y Elkins, WV MMAtil:l.'ilW • Mull:n Marietta Aggr~gaii!S hlroleem, WV MMAMU!l4 ·MarTin Marlttta Agi!f11gate$ l'arllerdlurll, WV MSI"l,Ol,7!14 • Mi!adews Stone & Pavlng Monterville, WV '""'"'MCSUl.764 • Mm:11r Cruslli!d Stone Princdlln, wv -PMQUL71l4 ·l"'lufldln~t Mills Quarry Bluefield, W\1 -I'MQ1.82.11M·I'oundlllgMIIIsQuarry l'o11nill1111 M!!lt, WV --RBSUI.7114 • RBS (Gnyatllne Quarry) SWVI.Ul.11M. Soutllem WV Aspliall Lewlsll11rg, WV Elld115, WV VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.042</GPH> For additional Information and Instructions concerning this liSt, see MP 700.00.51. 60492 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.043</GPH> EXHIBITB Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60493 VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00103 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.044</GPH> Approved (lnspeded} Aspl!altk Concrete Plants 60494 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices My !lllme is Chris l!!lgh and the legal vide~> specialist The oourt reporter is ~~ Hanrey. 12 The lime is awroxlmate!y1 :58 p.m. 13 Wooklllle oourt 11!!p(lrt!!r please swear llle wllnall!l. 14 [Witness swom.} 15 TERRY PARKS 16 wss cai!OO as a wilness by Plaintiffs, pursuant lo 17 wlitlenoolioo, and having baen first duly sworn, 16 tesiffied as foliews: 19 EXAM!NATlOO BY MR. RITCHIE: VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.045</GPH> Q. Teny, again, my name Is Zllk Rlk:llle. We just 22: met fw the first time out In the lobby, and I rep,res1111t severe! Glasser law firm Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60495 ETAlv. You can acluaHy go down and look at those records. Q. All right. Very good. I'll do that. Have you been interviewed by anyone about what 4 you know, what transplrnd about- you know, anything 5 wltll respect to Wsst VIrginia Paving? 6 A. No. No. !talked to Illes& guys a couple tlmss 7 when !hay fwst oome and started talking to me. Once 1 8 give them - ! talked to them about !he Information 9 have give )IOlH!IIloday, and !hat's !he only thing we've 10 discussed wi!lllhem. 11 Q. Did you talk to the United Statss Department of 12 Justice·· 13 A. I actually !atk.ed to the Department of Juslice 14 about the quarl)' buyout 15 Q. Okay. When was that and what was the context of thai? 17 A. That was up till last year, just where we were 18 gelling threatened to not be able !o buy stone II they 19 go! the quarries. 20 Q, Okay. Vousald you w11re threatened. Who threatened you? A Chris Hollifl!lld has totd me two or !hroo limes that if they gollha quarries that !hay ware going lo 1 Q. Where did you buy the plant that you 2 A. I bought it In St. Louis, Missouri. 3 Q, How much did you pay for that? A. I'm thinking $175,000 Is whatlha purchas& 4 5 price was on il. 6 Q, Okay. llld you have to finance any 7 A. Yes. It's still financed. Q. Okay. Did you finance the whole 9 price? 10 A. Yes. 11 Q. Okay, Did you have any additional costs that 12 you had to put in moving it, putting it up, and is any 13 ofthatfinanced? 14 A. Yes, there was soma of It financed. We ended 15 up like $1.2 minion in tM whole plant set 16 Q. Does that include tile property that you 17 bought? 18 A. Yes. Q. Where do you get tile components of your asphalt? A The stone comes from Pounding Mill and the liquid oomes !tom Assooia!ed Asph!llt in Roanoke, \llrgirna. 24 Q. 8 A. Yes. You don't go to Ashland to get it? A. We·· we get t!lck from Ashland is 1M only thing we get from Ashland is jus! our tact~. That's the 5 tar you put down on the road before you peve. 6 Q. Okay. Do you do work for lihe Department of Q. 3 Q, Okay. Hava you actually !tad any problems 4 gel11ng stone? A. Not up to this point, no, sir. 5 II Q.• Okay, 7 A. They h1111en'! acquired the quarries yet I ll think it comes s!feclive April 1st 9 Q, What Is your unt!emtendlng about that 10 ac:qulsitlon? 11 A. Well, from my undaretanding from the OOJ, the 12 DOJ !old me last year that the deal had been matte. 13 had to sell the Rocky Gap Quali)l oo the \llrginla side. 14 They ware going to sell that quali)l to an outside pereon 15 so we would ooguamnteedtogetstone. 16 Q. Okay. 17 A. Told us if we had any pmblsrns justto- jus! to contact them and they would make sum !hat we were abte to gel stone is what they're saying. Q. All right. You said that you bought the olt!er plant down there at Rocky GapA. Yes,sir. Q. -for, like, $30,000? A. Uh-huh. 7 imllsportllt!on -West Virglnlll Depal1:ment of 8 Tmnsportatlon? A. Yes, sir. II 10 Q. When did you stsrt doing that work? 11 A. lastyesr. Q, How many bid!l do you think you've won with 1M Departlllent of Transportlltion? A. last year probably 11111!1 or six. This year we 15 won~~~~~ P..card bid lind the lay-down bids. We've won!WO 16 this year. 17 Q. Okay. So, have things been going fairly well? 18 A. They've been decent, but 1M- how should I 19 put !hill? The ovamu money, wham we're down so fa!' oo pricing, you know, we're at a bare minimum trying to get by, just trying to make a living, bi!Csuse the prices wham West Virginia Paving, wham we've bulling heads 23 bying to -jus! bying to su!Viva. I'm saying? I mesn, oor- our profit VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.046</GPH> 37-40 60496 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00106 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.047</GPH> EXHIBITB TO RESPONSE Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 60497 DECLARATION OF TERRY PARKS AAA PAVING & SEALING, INC. I. Parks and l am the Vice President of AAl>. name is & Inc. ("AAA Paving"). AAA Paving operates out of nne asphalt-concrete plant (located at 560 Turnpike Industrial Park Road, Princeton, West that serves industrial, oommercial, and residential customers in the somhern area of West 2. For many of its customers, AAA 3. The distance from AAA whereto WVDOT aggregate. and the southwest must meets the allofAAA 4. WVDOT aggregate from its Mercer IS 6.5 miles from AAA also owned all of the other nearAAA The nearest quarry that quarry, which ls located at 707 about 60 miles away lromAAA 5. Mill, including the I understand that in July 2018, CRH acquired Mercer Quarry. l also understand that the Department of Justice required that Pounding Mill's 6. a much to Salem Stone gave AAA The sale of the it had before CRH VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00107 Fmt 4703 Sfmt 4725 Quarry were both E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.048</GPH> and the 60498 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices did no! compete. Instead, the next best alternative to the owned Mercer Quarry not owned by Pounding Mill was in Lewisburg, West away from AAA As a result of the sale of the Roeky Gap next best alternative to the the next best alternative to the 1\A"'"""'" """""'' is now 14 This means that AAA while berore the aeqiuisitlon it was about 60 miles away. miles away from AAA 7. the Mercer 1.5 miles farther away from AAA Gap The about 60 miles t'mmom!l Sim:eCRH Mill in has been now owned ourcha:>im: WVDOT aggregate from the Mercer for WVDOT aggregate from the Merc,cr CRH. AAA have not increased since CRH the Mercer Quarry. CRH has never refused to supply AAA Paving with WVOOT aggregate. costs for WVDOT aggregate have not increased since CRH AAA the Mercer Quarry. The 8. ll!!;l~re~~ate reQIUi!'leme~nts. forAAA is a viable alternative to the Gap AAA To obtain aggregate from the would need to truck the aggregate an additional 7.5 miles to tbe I do not the distance from AAA that that additional distance would .,,,,a;,,d"' 1" raise my costs. 9. Salem Stone reached out to let me know that it is interested in aggregate to AAA Paving once ilcornPI<etes preparing the equ1lpn1ent at the produce WVOOT aggregate. AAA has not yet Gap Quarry to any aggregate from the Roeky Quarry. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00108 Fmt 4703 Sfmt 4725 E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.049</GPH> 2 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices BILLING CODE 4410–11–C Executive Office for Immigration Review [OMB Number 1125–0006] Agency Information Collection Activities; Proposed Collection; Comments Requested; Reinstatement, With Change, of a Currently Approved Collection Executive Office for Immigration Review, Department of Justice. ACTION: 30 Day Notice. AGENCY: VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 PO 00000 Frm 00109 Fmt 4703 Sfmt 4703 The Department of Justice, Executive Office for Immigration Review, is submitting the following information collection request to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act of 1995. DATES: The Department of Justice encourages public comment and will accept input until December 26, 2018. FOR FURTHER INFORMATION CONTACT: If you have additional comments especially on the estimated public burden or associated response time, suggestions, or need a copy of the proposed information collection SUMMARY: DEPARTMENT OF JUSTICE E:\FR\FM\26NON1.SGM 26NON1 EN26NO18.050</GPH> [FR Doc. 2018–25593 Filed 11–23–18; 8:45 am] 60499

Agencies

[Federal Register Volume 83, Number 227 (Monday, November 26, 2018)]
[Notices]
[Pages 60446-60499]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25593]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. CRH plc, et al.; Response to Public Comment

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec.  16(b)-(h), that one comment was received 
concerning the proposed Final Judgment in this case, and that comment 
together with the Response of the United States to Public Comment have 
been filed with the United States District Court for the District of 
Columbia in United States of America v. CRH plc, et al., Civil Action 
No. 1:18-cv-1473. Copies of the comment and the United States' Response 
are available for inspection on the Antitrust Division's website 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.

Patricia A. Brink,
Director of Civil Enforcement.

United States District Court for the District of Columbia

    United States of America, Plaintiff, v. CRH PLC, CRH Americas 
Materials, Inc., and Pounding Mill Quarry Corporation, Defendants.

Case No. 18-cv-1473-DLF
Judge: Dabney L. Friedrich

RESPONSE OF PLAINTIFF UNITED STATES TO PUBLIC COMMENT ON THE PROPOSED 
FINAL JUDGMENT

    Pursuant to the requirements of the Antitrust Procedures and 
Penalties Act (the ``APPA'' or ``Tunney Act''), 15 U.S.C. Sec. Sec.  
16(b)-(h), the United States hereby responds to the public comment 
received regarding the proposed Final Judgment in this case. After 
careful consideration of the submitted comment, the United States 
continues to believe that the divestiture required by the proposed 
Final Judgment provides an effective and appropriate remedy for the 
antitrust violation alleged in the Complaint. In addition, the 
divestiture has the effect of increasing competitive choices for some 
customers. As a result of the divestiture, two quarries that previously 
did not compete--because they were under common ownership--now do. The 
United States will move the Court for entry of the proposed Final 
Judgment after the public comment and this response have been published 
pursuant to 15 U.S.C. Sec.  16(d).

I. PROCEDURAL HISTORY

    Defendants CRH plc and CRH Americas Materials, Inc. (collectively, 
``CRH'') agreed to acquire the assets of Defendant Pounding Mill Quarry 
Corporation (``Pounding Mill''), which primarily consisted of four 
aggregate quarries located in West Virginia and Virginia. The United 
States filed a civil antitrust Complaint on June 22, 2018, seeking to 
enjoin the proposed acquisition. The Complaint alleged that the likely 
effect of this acquisition would be to lessen competition substantially 
in the markets for aggregate and asphalt concrete that are used in West 
Virginia Department of Transportation (``WVDOT'') road projects in 
southern West Virginia. This loss of competition likely would result in 
increased prices and decreased service in these markets. Therefore, the 
Complaint alleged that the proposed acquisition violates Section 7 of 
the Clayton Act, 15 U.S.C. Sec.  18, and should be enjoined.
    Simultaneously with the filing of the Complaint, the United States 
filed a proposed Final Judgment, a Stipulation signed by Plaintiff and 
Defendants consenting to entry of the proposed Final Judgment after 
compliance with the requirements of the Tunney Act, 16 U.S.C. Sec.  16, 
and a Competitive Impact Statement (``CIS'') describing the transaction 
and the proposed Final Judgment. The United States published the 
proposed Final Judgment and the CIS in the Federal Register on July 2, 
2018, see 83 Fed. Reg. 30956 (July 2, 2018), and caused summaries of 
the proposed Final Judgment and CIS, together with directions for the 
submission of written comments relating to the proposed Final Judgment, 
to be published in the Washington Post and Bluefield Daily Telegraph 
from July 2, 2018, through July 10, 2018. The 60-day public comment 
period ended on September 10, 2018. The United States received one 
public comment. See Tunney Act Comments of the State of West Virginia 
on the Proposed Final Judgment (``WV Comment''), attached hereto as 
Exhibit A.

II. 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 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. 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

[[Page 60447]]

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). 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) 
(explaining that the ``court's inquiry is limited'' in Tunney Act 
settlements); United States v. InBev N.V./S.A., No. 08-1965 (JR), 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 mechanisms to enforce the final 
judgment are clear and manageable'').
    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 in the government's complaint, whether the decree is 
sufficiently clear, whether its 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. Instead:

[t]he balancing of competing social and political interests affected by 
a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's role 
in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to the 
decree. The court is required to determine not whether a particular 
decree is the one that will best serve society, but whether the 
settlement is ``within the reaches of the public interest.'' More 
elaborate requirements might undermine the effectiveness of antitrust 
enforcement by consent decree.
    Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).\1\
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    \1\ See also 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'').
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    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 74-75 (noting that a court should not reject the proposed remedies 
because it believes others are preferable and that room must be made 
for the government to grant concessions in the negotiation process for 
settlements); 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 government's prediction as to the effect of 
proposed remedies, its perception of the market structure, and its 
views of the nature of the case''). The ultimate question is 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.' '' Microsoft, 56 F.3d at 1461 (quoting United States v. 
Western Elec. Co., 900 F.2d 283, 309 (D.C. Cir. 1990)). 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 complaint'' to inquire 
into other matters that the United States did not pursue. Microsoft, 56 
F.3d at 1459-60. As a court in this district 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,\2\ 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, 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). This language explicitly wrote into the statute 
what Congress intended when it first 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)

[[Page 60448]]

(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. 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. See also 
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''); S. Rep. No. 93-298 93d 
Cong., 1st Sess., at 6 (1973) (``Where the public interest can be 
meaningfully evaluated simply on the basis of briefs and oral 
arguments, that is the approach that should be utilized.'').
---------------------------------------------------------------------------

    \2\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for a 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. 
Sec.  16(e) (2004), with 15 U.S.C. Sec.  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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III. THE INVESTIGATION AND PROPOSED FINAL JUDGMENT

    The Department of Justice conducted an extensive investigation into 
the proposed acquisition and the proposed divestiture. The Department 
reviewed business documents, conducted economic analysis, and 
interviewed a substantial number of customers and actual and potential 
competitors in the aggregate and asphalt-concrete markets to ascertain 
whether the acquisition would be anticompetitive. The Department also 
worked extensively with the State of West Virginia and, in particular, 
the agency most familiar with the markets at issue, WVDOT, which sets 
quality standards for aggregate used in road construction and repair 
and qualifies suppliers of aggregate to bid on WVDOT road projects. 
Later, the Department thoroughly vetted the potential divestiture over 
the course of several months, a process that included re-interviewing 
customers, competitors, and the proposed divestiture buyer, document 
and data requests, and the retention of an expert geologist. Throughout 
this process, the Department worked in cooperation with the WVDOT to 
ensure it was satisfied that the divestiture would eliminate any 
concerns about the acquisition.\3\
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    \3\ The Department's cooperation with WVDOT included seeking and 
obtaining comments and revisions to the proposed Final Judgment.
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    In the Complaint, the United States alleged that CRH supplies 
aggregate in Wyoming, Raleigh, Mercer, and Summers Counties in West 
Virginia (these counties are referred to in the Complaint as ``Southern 
West Virginia''). Before being acquired by CRH, Pounding Mill owned two 
quarries that also supplied aggregate in Southern West Virginia. 
Without the divestiture, the proposed acquisition would have resulted 
in CRH owning nearly all of the aggregate quarries that supply Southern 
West Virginia and would have eliminated the horizontal, head-to-head 
competition between CRH and Pounding Mill in the supply of aggregate.
    The Complaint also alleged that the acquisition would raise 
vertical competition concerns. In addition to aggregate, CRH produces 
and sells asphalt concrete. Aggregate is an essential input in asphalt 
concrete. AAA Paving and Sealing, Inc. (``AAA Paving''), a recent 
entrant, is the only company that competes with CRH to supply asphalt 
concrete in Southern West Virginia. Before the acquisition, AAA Paving 
relied on Pounding Mill to supply the aggregate it needs to manufacture 
asphalt concrete. The acquisition therefore would have put the quarries 
that are AAA Paving's only economically viable sources of aggregate 
under the ownership of CRH, its competitor in the sale of asphalt 
concrete. According to the Complaint, if CRH were to acquire its 
rival's only economically viable source of aggregate, it would have the 
incentive and ability to disadvantage AAA Paving by withholding this 
essential input or supplying it on less favorable terms, resulting in 
higher prices for the sale of asphalt concrete in Southern West 
Virginia.
    Under the proposed Final Judgment, CRH is required to divest 
Pounding Mill's Rocky Gap quarry located in Rocky Gap, Virginia 
(hereinafter, the ``Rocky Gap Quarry'') and related assets to Salem 
Stone Corporation (``Salem Stone''). See Figure 1, below. After a 
thorough evaluation of Salem Stone, the United States approved Salem 
Stone as the buyer. Salem Stone is a strong aggregate competitor in 
markets near Southern West Virginia. Salem Stone has extensive 
experience producing and selling aggregate, and is familiar with both 
WVDOT's approval process and with the surrounding area. As a result, 
Salem Stone is well-positioned to operate the divestiture assets and 
provide meaningful competition.
    The divestiture required by the proposed Final Judgment therefore 
will preserve, and indeed in some respects increase, competition in the 
markets for WVDOT aggregate and WVDOT asphalt concrete by establishing 
a new, independent, and economically viable WVDOT aggregate supplier in 
Southern West Virginia. The divestiture also will ensure that AAA 
Paving, CRH's sole competitor in the supply of asphalt concrete, has an 
independent aggregate supplier to which it could economically turn.
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BILLING CODE 4410-11-P

IV. SUMMARY OF COMMENT AND THE UNITED STATES' RESPONSE

A. Summary of WVAGO Comment

    The State of West Virginia through its Office of the Attorney 
General (``WVAGO'') submitted the only comment received in this matter. 
The comment contends that the proposed settlement will not resolve the 
competitive concerns the United States alleged in its Complaint because 
the settlement will not preserve AAA Paving's ability to compete in the 
sale of asphalt concrete.\4\ The comment contends that two companies--
CRH and AAA Paving--supply asphalt concrete in the southern part of 
West Virginia and that if CRH were to acquire Pounding Mill's quarries, 
AAA Paving would not have an independent source of supply for the 
aggregate it needs to manufacture asphalt concrete. (WV Comment, ] 1.) 
The comment also contends that the Mercer Quarry, which CRH acquired 
from Pounding Mill, is the closest source of aggregate to the southern 
part of West Virginia.\5\ (Id. at ] 2.) The comment claims that AAA 
Paving's next-closest alternative, the Rocky Gap Quarry, is not a 
viable option for AAA Paving because that quarry is 17 miles away from 
AAA Paving. (Id. at ]] 5, 10.) The comment further claims that 
purchasing from the Rocky Gap Quarry would require AAA Paving to incur 
higher costs for its aggregate, which would make AAA Paving's asphalt 
concrete less competitive. (Id. at ] 7.)
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    \4\ The State of West Virginia currently is litigating an 
antitrust action against CRH and others in the Circuit Court of 
Kanawha County, West Virginia. That lawsuit alleged, across the 
entire state of West Virginia, ``monopolization of the markets for 
aggregates, asphalt, and asphalt paving as well as unreasonable 
restraints of trade in those markets.'' (WV Comment, p. 1.) The 
United States' proposed Final Judgment is not intended to resolve 
these much broader claims, but instead is designed to remedy the 
anticompetitive effects in a four-county area that would otherwise 
result from the combination of CRH and Pounding Mill.
    \5\ The comment does not define the geographic area it refers to 
as the ``southern part of the State of West Virginia.'' The 
geographic area described in the comment may differ from the four-
county area defined in the United States' Complaint as ``Southern 
West Virginia.''
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    WVAGO's comment also expresses the following concerns. First, the 
comment contends that CRH has refused to supply AAA Paving with 
aggregate on several occasions since it acquired the Mercer Quarry. 
(Id. at ] 4.) Second, the comment claims that when CRH refused to 
supply AAA Paving with aggregate from the Mercer Quarry, CRH provided 
AAA Paving with monetary credits to account for the additional trucking 
costs AAA Paving would incur by having to purchase aggregate from the 
Rocky Gap Quarry, but that ``CRH will not provide those trucking 
credits forever.'' (Id. at ] 6.) Finally, the comment contends that AAA 
Paving's costs for aggregate have already increased since CRH acquired 
Pounding Mill. (Id. at ] 10.)

B. The United States' Response

    The United States evaluated WVAGO's comment, investigated the basis 
for the claims in the comment, and continues to believe that the 
divestiture of the Rocky Gap Quarry completely remedies the 
anticompetitive harm alleged in the Complaint. The proposed Final 
Judgment secures a structural remedy that fully addresses both the 
horizontal harm alleged in the aggregate market and the vertical harm 
alleged in the asphalt-concrete market. The divestiture of Pounding 
Mill's Rocky Gap Quarry to Salem Stone creates a new competitor in 
Southern West Virginia and therefore preserves the competition that 
would have been lost

[[Page 60450]]

absent the divestiture. Indeed, as discussed in more detail below, AAA 
Paving views the divestiture as leaving it with more alternative 
sources of aggregate than it had before the acquisition, because the 
Rocky Gap Quarry now is a nearby alternative to CRH's Mercer Quarry.
    Terry Parks, Vice President of AAA Paving, believes that the Rocky 
Gap Quarry is a viable alternative to the Mercer Quarry for AAA 
Paving's aggregate needs. See Declaration of Terry Parks (``Parks 
Decl.''), attached hereto as Exhibit B, at ] 6. The comment incorrectly 
claims that AAA Paving would need to truck aggregate 17 miles from the 
Rocky Gap Quarry. The Rocky Gap Quarry is 14 miles away from AAA 
Paving, and only 7.5 miles further away from AAA Paving than the Mercer 
Quarry. (Id.) Mr. Parks' declaration directly refutes WVAGO's claim 
that AAA Paving would not be competitive in the asphalt-concrete market 
if it had to purchase aggregate from the Rocky Gap Quarry. (Id. at ] 8 
(``The Rocky Gap Quarry is a viable alternative to the Mercer Quarry 
for AAA Paving's aggregate requirements. To obtain aggregate from the 
Rocky Gap Quarry, AAA Paving would need to truck aggregate an 
additional 7.5 miles beyond the distance from AAA Paving's plant to the 
Mercer Quarry. I do not anticipate that that additional distance would 
significantly raise my costs.'').)
    Moreover, the allegations upon which WVAGO bases its comment are 
unsupported and factually incorrect. For example, the comment states 
that CRH refused to supply AAA Paving with aggregate on several 
occasions since CRH acquired the Mercer Quarry. (WV Comment, ] 4). Mr. 
Parks, however, confirmed that CRH has never refused to provide AAA 
Paving with aggregate. (Parks Decl., ] 7.) Indeed, according to Mr. 
Parks, AAA Paving continues to purchase aggregate from the Mercer 
Quarry and the prices CRH charges AAA Paving have not increased since 
CRH acquired the quarry. (Id.) Further, while WVAGO alleged that AAA 
Paving's costs for aggregate have increased since CRH acquired Pounding 
Mill, Mr. Parks states that AAA Paving's costs for aggregate have not 
in fact increased. (Id.)
    In addition, the comment states that CRH provided AAA Paving with 
credits when it refused to supply AAA Paving with aggregate from the 
Mercer Quarry to account for the additional trucking costs that AAA 
Paving would incur by having to purchase from the Rocky Gap Quarry, but 
``CRH will not provide those trucking credits forever.'' (WV Comment, ] 
6.) Mr. Parks, however, explained that while CRH has supplied AAA 
Paving with discounts (or credits), it was not because CRH refused to 
supply AAA Paving with aggregate. (Parks Decl., ] 10.) Rather, the 
discounts were a goodwill gesture by CRH, because a major road 
construction project near the Mercer Quarry was causing significant 
traffic delays. (Id.) CRH offered to supply AAA Paving from a CRH 
quarry that is further away and provide AAA Paving with discounts to 
make up for the additional trucking costs. (Id.) At this point, AAA 
Paving has not purchased any aggregate from the Rocky Gap Quarry. (Id. 
at ] 9.)
    Further, AAA Paving and other aggregate customers stand to benefit 
from the divestiture of the Rocky Gap Quarry to Salem Stone. The 
divestiture creates competition between the Rocky Gap Quarry and the 
Mercer Quarry, which previously did not compete because both were owned 
by Pounding Mill. Prior to the acquisition, the closest competing 
aggregate suppliers for customers near the Mercer Quarry were located 
in Lewisburg, West Virginia--over 60 miles to the northeast. Due to the 
high cost of trucking aggregate, prices for aggregate are often 
disciplined by the total cost to the purchaser of obtaining aggregate 
from the next closest quarry, which includes the additional trucking 
costs of transporting aggregate from a farther quarry. The closer 
quarry can price aggregate just below the amount the customer would pay 
to obtain aggregate from the next closest quarry. So, prior to the 
acquisition, the Mercer Quarry should have set its prices to AAA Paving 
just below what the Lewisburg, West Virginia quarries would charge, 
based on their likely transportation costs. After the divestiture, the 
next closest competitor to the Mercer Quarry is now the Rocky Gap 
Quarry, which is over 50 miles closer; AAA Paving will need to travel 
only about 7.5 additional miles to obtain aggregate from the Rocky Gap 
Quarry. (Id. at ] 6). Consequently, the price of aggregate quoted to 
AAA Paving and other customers from the Rocky Gap Quarry is likely to 
be lower following the divestiture than it would have been prior to the 
acquisition. In sum, the divestiture ensures that CRH's acquisition of 
Pounding Mill will not result in less competition or fewer alternatives 
for AAA Paving or other nearby customers.

V. CONCLUSION

    After careful consideration of the public comment, the Department 
continues to believe that the proposed Final Judgment, as drafted, 
provides an effective and appropriate remedy for the antitrust 
violations alleged in the Complaint, and is therefore in the public 
interest. The Department will move this Court to enter the proposed 
Final Judgment after the comment and this response are published 
pursuant to 15 U.S.C. Sec.  16(d).

Dated: November 16, 2018
Respectfully submitted,

FOR PLAINTIFF
UNITED STATES OF AMERICA

-----------------------------------------------------------------------
Christine A. Hill
Attorney, United States Department of Justice, Antitrust Division, 
Defense, Industrials, and Aerospace Section, 450 Fifth Street, N.W., 
Suite 8700, Washington, D.C. 20530, (202) 305-2738, 
[email protected]
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[FR Doc. 2018-25593 Filed 11-23-18; 8:45 am]
BILLING CODE 4410-11-C

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