United States, et al. v. Republic Services, Inc., et al. Proposed Final Judgment and Competitive Impact Statement, 18300-18323 [2021-07224]

Agencies

• Antitrust Division
• Department of Justice

[Federal Register Volume 86, Number 66 (Thursday, April 8, 2021)]
[Notices]
[Pages 18300-18323]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-07224]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States, et al. v. Republic Services, Inc., et al. Proposed 
Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation, and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States of America, et al. v. Republic Services, Inc., et al., Civil 
Action No. 1:21-cv-00883. On March 31, 2021, the United States filed a 
Complaint alleging that Republic Services, Inc.'s proposed acquisition 
of Santek Waste Services, LLC would violate Section 7 of the Clayton 
Act, 15 U.S.C. 18. The proposed Final Judgment, filed at the same time 
as the Complaint, requires Republic and Santek to divest certain 
tangible and intangible assets relating to small container commercial 
waste collection and municipal solid waste disposal in six local 
markets located in five states.
    Copies of the Complaint, proposed Final Judgment, and Competitive 
Impact Statement 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.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the Antitrust Division's website, 
filed with the Court, and, under certain circumstances, published in 
the Federal Register. Comments should be submitted in English and 
directed to Katrina Rouse, Chief, Defense, Industrials, and Aerospace 
Section, Antitrust Division, Department of Justice, 450 Fifth Street 
NW, Suite 8700, Washington, DC 20530.

Suzanne Morris,
Chief, Premerger and Division Statistics, Antitrust Division.

United States District Court for the District of Columbia

    United States of America, U.S. Department of Justice, Antitrust 
Division, 450 Fifth Street NW, Suite 8700, Washington, DC 20530 and 
State of Alabama, Office of the Attorney General, Consumer Interest 
Division, 501 Washington Avenue, Montgomery, AL 36130, Plaintiffs, v. 
Republic Services, Inc., 18500 North Allied Way, Phoenix, AZ 85054 and 
Santek Waste Services, LLC, 650 25th Street NW, Suite 100, Cleveland, 
TN 37311, Defendants.

Civil Action No.: 1:21-cv-00883-RDM
Judge: Randolph D. Moss

Complaint

    The United States of America (``United States''), acting under the 
direction of the Attorney General of the United States, and the State 
of Alabama, bring this civil antitrust action against Defendants 
Republic Services, Inc. (``Republic'') and Santek Waste Services, LLC 
(``Santek'') to enjoin Republic's proposed acquisition of Santek. The 
United States and the State of Alabama complain and allege as follows:

I. Nature of the Action

    1. Republic's proposed acquisition of its rival, Santek, would 
combine two of the largest waste management companies in numerous 
markets across the southeastern United States. Republic and Santek 
compete daily to provide essential waste collection and disposal 
services to keep neighborhoods sanitary.

[[Page 18301]]

If the transaction proceeds unremedied, customers likely will pay 
higher prices and receive lower quality waste collection and disposal 
services.
    2. In a number of markets in the southeastern United States, 
Defendants Republic and Santek are two of only a few significant 
providers of small container commercial waste (``SCCW'') collection and 
municipal solid waste (``MSW'') disposal, which are necessary for 
businesses, municipalities, and towns.
    3. If the transaction proceeds to close in its current form, 
consumers would likely pay higher prices and receive lower quality 
service. Competition between Republic and Santek has resulted in lower 
prices and improved service to numerous customers, including towns and 
cities, restaurants, offices, apartment buildings, and other 
businesses. SCCW collection customers depend on Republic and Santek to 
collect their waste reliably and on a regular basis. In the absence of 
competition between Republic and Santek, these customers would likely 
pay more for waste collection and receive lower quality service. 
Disposal customers, such as independent and municipally-owned waste 
haulers, rely on Republic and Santek for affordable and accessible 
waste disposal options, including landfills and transfer stations, to 
dispose of the waste they collect from towns, cities, and other 
municipalities. If the transaction is consummated as proposed by 
Defendants, these disposal customers would likely face higher fees and 
less favorable access to Republic's and Santek's disposal facilities.
    4. In addition, the merger would also substantially lessen 
competition in waste collection in one geographic market (Chattanooga, 
Tennessee and North Georgia), as a result of the vertical integration 
of these firms, both of which enjoy strong positions in collection and 
disposal. Specifically, the combination of these two vertically-
integrated firms that are both strong in collection and disposal would 
give the merged firm an increased incentive and ability to weaken its 
collection competitors by raising the price of disposal, a key input 
for collection services. With limited alternative disposal options left 
in the market, collection rivals would have to incur these higher costs 
or cease their operations, thereby limiting the ability of these rivals 
to compete with the merged firm's collection operations.
    5. By eliminating competition between Republic and Santek and 
combining their businesses, the proposed acquisition would result in 
higher prices, fewer choices, and lower-quality service for waste 
collection and disposal customers in certain markets in the 
southeastern United States. Accordingly, Republic's acquisition of 
Santek would violate Section 7 of the Clayton Act, 15 U.S.C. 18, and 
therefore should be enjoined.

II. The Parties and the Transaction

    6. Pursuant to a purchase agreement dated February 18, 2020, and 
amended on May 19, 2020, July 10, 2020, October 6, 2020, and March 8, 
2021, Republic proposes to acquire all of the outstanding membership 
interest in Santek.
    7. Republic, a Delaware corporation headquartered in Phoenix, 
Arizona, is the second-largest non-hazardous solid waste collection and 
disposal company in the United States. It provides waste collection, 
recycling, and disposal (including transfer) services. Republic 
operates in 41 states and Puerto Rico. For 2020, Republic reported 
revenues of approximately $10.2 billion.
    8. Santek, a Tennessee limited liability company headquartered in 
Cleveland, Tennessee, is a vertically integrated solid waste management 
company with waste collection and disposal (including transfer) 
operations in nine southeastern states. In 2019, the last year for 
which information is publicly available, Santek generated approximately 
$140 million in revenue.

III. Jurisdiction and Venue

    9. The United States brings this action under Section 15 of the 
Clayton Act, 15 U.S.C. 25, as amended, to prevent and restrain 
Defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18.
    10. The State of Alabama brings this action under Section 16 of the 
Clayton Act, 15 U.S.C. 26, to prevent and restrain Defendants from 
violating Section 7 of the Clayton Act, 15 U.S.C. 18. The State of 
Alabama, by and through the Attorney General of Alabama, brings this 
action as parens patriae on behalf of and to protect the health and 
welfare of its citizens and the general economy of the State of 
Alabama.
    11. Defendants' activities substantially affect interstate 
commerce. They provide collection and disposal services throughout the 
southeastern United States. This Court has subject matter jurisdiction 
over this action pursuant to Section 15 of the Clayton Act, 15 U.S.C. 
25, and 28 U.S.C. 1331, 1337(a), and 1345.
    12. Defendants have consented to venue and personal jurisdiction in 
this judicial district. Venue is proper in this district under Section 
12 of the Clayton Act, 15 U.S.C. 22, and under 28 U.S.C. 1391(b) and 
(c).

IV. Relevant Markets

A. Product Markets

i. Small Container Commercial Waste Collection
    13. Small container commercial waste (``SCCW'') collection is a 
relevant product market. Waste collection firms--also called haulers--
collect municipal solid waste (``MSW'') from residential, commercial, 
and industrial establishments, and transport that waste to a disposal 
site, such as a transfer station, landfill, or incinerator, for 
processing and disposal.
    14. SCCW collection is the business of collecting MSW from 
commercial and industrial accounts, usually in small containers (i.e., 
dumpsters with one to ten cubic yards capacity), and transporting such 
waste to a disposal site. Typical SCCW collection customers include 
office and apartment buildings and retail establishments like stores 
and restaurants.
    15. SCCW collection is distinct from other types of waste 
collection such as residential and roll-off collection. An individual 
commercial customer typically generates substantially more MSW than a 
residential customer. To handle this high volume of MSW efficiently, 
SCCW haulers often provide commercial customers with small containers 
for storing the waste. SCCW haulers organize their commercial accounts 
into routes and collect and transport the MSW generated by these 
accounts in front-end load (``FEL'') trucks that are uniquely well 
suited for commercial waste collection.
    16. On a typical SCCW collection route, an operator drives a FEL 
truck to the customer's container, engages a mechanism that grasps and 
lifts the container over the front of the truck, and empties the 
container into the vehicle's storage section where the waste is 
compacted and stored. The operator continues along the route, 
collecting MSW from each of the commercial accounts, until the vehicle 
is full. The operator then drives the FEL truck to a disposal facility, 
such as a transfer station, landfill, or incinerator, and empties the 
contents of the vehicle. Depending on the number of locations and 
amount of waste collected on the route, the operator may make one or 
more trips to the disposal facility in servicing the route.
    17. In contrast to a SCCW collection route, a residential waste 
collection route is highly labor intensive. A residential customer's 
MSW is typically stored in much smaller containers such

[[Page 18302]]

as trash cans, and instead of using a FEL truck manned by a single 
operator, residential haulers routinely use rear-end load or side-load 
trucks typically manned by two- or three-person teams who may need to 
hand-load the customer's MSW. In light of these differences, haulers 
typically organize commercial customers into separate routes from 
residential customers.
    18. Roll-off container collection also is not a substitute for SCCW 
collection. Roll-off container collection is commonly used to serve 
construction and demolition customers. A roll-off container is much 
larger than a SCCW container and is serviced by a truck capable of 
carrying a single roll-off container. Unlike SCCW customers, multiple 
roll-off customers are not served between trips to the disposal site, 
as each roll-off truck is typically only capable of carrying one roll-
off container at a time.
    19. Other types of waste collection, such as hazardous or medical 
waste collection, also are not substitutes for SCCW collection. These 
forms of collection differ from SCCW collection in the equipment 
required, the volume of waste collected, and the facilities where the 
waste is disposed.
    20. Because no other waste collection service can substitute for 
SCCW collection, other waste collection services do not constrain 
pricing for SCCW collection. Absent competition, SCCW collection 
providers could profitably increase their prices without losing 
significant sales to firms engaged in the provision of other types of 
waste collection services. In other words, in the event of a small but 
significant non-transitory price increase for SCCW collection, 
customers would not substitute to other forms of collection in 
sufficient numbers so as to render the price increase unprofitable. 
SCCW collection is therefore a line of commerce, or relevant product 
market, for purposes of analyzing the effects of the acquisition under 
Section 7 of the Clayton Act.
ii. Municipal Solid Waste Disposal
    21. MSW disposal is a relevant product market. MSW is solid 
putrescible waste generated by households and commercial establishments 
such as retail stores, offices, restaurants, warehouses, and industrial 
facilities. MSW has physical characteristics that readily distinguish 
it from other liquid or solid waste, such as waste from manufacturing 
processes, regulated medical waste, sewage, sludge, hazardous waste, or 
waste generated by construction or demolition sites.
    22. Haulers must dispose of all MSW at a permitted disposal 
facility. There are intermediary disposal facilities--transfer 
stations--and ultimate disposal facilities--landfills and incinerators. 
All such facilities must be located on approved types of land and 
operated under prescribed procedures. Federal, state, and local safety, 
environmental, zoning, and permit laws and regulations dictate critical 
aspects of storage, handling, transportation, processing, and disposal 
of MSW. In less densely populated areas, MSW often is disposed of 
directly into landfills that are permitted and regulated by a state and 
the federal government. Landfill permit restrictions often impose 
limitations on the type and amount of waste that can be deposited. In 
many urban and suburban areas, landfills are scarce due to high 
population density and the limited availability of suitable land. As a 
result, MSW generated in such areas often is burned in an incinerator 
or taken to a transfer station. Transfer stations briefly hold MSW 
until it is reloaded from collection vehicles onto larger tractor-
trailers for transport, in bulk, to more distant landfills or 
incinerators for final disposal.
    23. Some haulers--including Republic and Santek--are vertically 
integrated and operate their own disposal facilities. Vertically-
integrated haulers often prefer to dispose of waste at their own 
disposal facilities. Vertically-integrated haulers may also sell a 
portion of their disposal capacity to disposal customers in need of 
access to a disposal facility.
    24. Disposal customers include private waste haulers without their 
own disposal assets (referred to in the industry as ``independent 
haulers'') as well as local governments that own their own equipment 
and collect their citizens' waste themselves. Disposal customers also 
include independent and municipally-owned transfer stations that serve 
as temporary disposal sites for haulers in areas where landfills and 
incinerators are not easily accessible. Disposal customers that are not 
vertically-integrated lack their own ultimate disposal facilities and 
rely on cost-competitive landfills.
    25. Due to strict laws and regulations that govern the disposal of 
MSW, there are no reasonable substitutes for MSW disposal, which must 
occur at landfills, incinerators, or transfer stations. Thus, in the 
event of a small but significant non-transitory price increase from MSW 
disposal firms, customers would not substitute to other forms of 
disposal in sufficient numbers so as to render the price increase 
unprofitable. MSW disposal is therefore a line of commerce, or relevant 
product market, for purposes of analyzing the effects of the 
acquisition under Section 7 of the Clayton Act.

B. Relevant Geographic Markets

i. Small Container Commercial Waste Collection Geographic Markets
    26. The relevant geographic markets for SCCW collection are local. 
This is because SCCW haulers need a large number of closely located 
customer pick-up locations to operate efficiently and profitably. If 
there is significant travel time between customers, then the SCCW 
hauler earns less money for the time that the truck operates. SCCW 
haulers, therefore, try to minimize the ``dead time'' in which the 
truck is operating and incurring costs from fuel, wear and tear, and 
labor, but not generating revenue from collecting waste. Likewise, 
customers must be near the SCCW hauler's base of operations as it would 
be unprofitable for a truck to travel a long distance to the start of a 
route. SCCW haulers, therefore, generally establish garages and related 
facilities to serve as bases within each area served.
    27. As currently contemplated, the transaction would likely cause 
harm in four relevant geographic markets for SCCW collection: (1) The 
Birmingham, Alabama area (Jefferson and Shelby Counties); (2) the 
Chattanooga, Tennessee and North Georgia area (Hamilton, Marion, Rhea, 
and Sequatchie Counties in Tennessee; and Catoosa, Chattooga, Dade, 
Gordon, Murray, and Walker Counties in Georgia); (3) the Eastern 
Montgomery County, Texas area (the area east of the City of Conroe 
defined as zip codes 77357, 77365, and 77372); and (4) the Hattiesburg, 
Mississippi area (Forrest and Jones Counties). In each of these 
markets, a hypothetical monopolist of SCCW collection could profitably 
impose a small but significant non-transitory increase in price for 
SCCW collection without losing significant sales to more distant 
competitors. Accordingly, each of these areas constitutes a relevant 
geographic market and section of the country for purposes of analyzing 
the effects of the acquisition on SCCW collection under Section 7 of 
the Clayton Act.
ii. Municipal Solid Waste Disposal Geographic Markets
    28. The relevant geographic markets for MSW disposal are local as 
the cost of transporting MSW to a disposal site--including fuel, 
regular truck maintenance, and hourly labor--is a substantial component 
of the total cost

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of MSW disposal. Haulers also prefer nearby MSW disposal sites to 
minimize the FEL truck dead time. Due to the costs associated with 
travel time and customers' preference to have MSW disposal sites close 
by, an MSW disposal provider must have local facilities to be 
competitive.
    29. The proposed transaction would likely cause harm in two 
relevant geographic markets for MSW disposal: (1) The Chattanooga, 
Tennessee area (Hamilton County); and (2) the Estill Springs and 
Fayetteville, Tennessee area (Franklin and Lincoln Counties). In each 
of these local markets, a hypothetical monopolist of MSW disposal could 
profitably impose a small but significant non-transitory increase in 
price for MSW disposal without losing significant sales to more distant 
MSW disposal sites. Accordingly, the Chattanooga, Tennessee area, and 
the Estill Springs and Fayetteville, Tennessee area constitute relevant 
geographic markets for the purposes of analyzing the effects of the 
acquisition on MSW disposal under Section 7 of the Clayton Act.

V. Anticompetitive Effects

    30. The proposed transaction would increase concentration 
significantly and substantially lessen competition and harm consumers 
in each relevant market by eliminating the substantial head-to-head 
competition that currently exists between Republic and Santek.
    31. Market concentration can be a useful indicator of the level of 
competitive vigor in a market and likely competitive effects of a 
merger. The more concentrated a market, and the more a transaction 
would increase concentration in a market, the more likely it is that 
the transaction would result in harm to consumers by meaningfully 
reducing competition.
    32. Concentration in relevant markets is typically defined by the 
Herfindahl-Hirschman Index (or ``HHI,'' defined in Appendix A). Markets 
in which the HHI is above 2,500 are considered to be highly 
concentrated. Mergers that increase the HHI by more than 200 points and 
result in a highly concentrated market are presumed to likely enhance 
market power. See U.S. Dep't of Justice & Fed. Trade Comm'n, Horizontal 
Merger Guidelines Sec.  5.3 (revised Aug. 19, 2010) (``Horizontal 
Merger Guidelines''), https://www.justice.gov/atr/horizontal-merger-guidelines-08192010.
    33. Republic's acquisition of Santek would result in a highly 
concentrated market in every relevant SCCW collection market and 
relevant MSW disposal market. Moreover, as a result of the acquisition, 
the HHI would increase by more than 400 points in each of these 
markets, suggesting an increased likelihood of significant 
anticompetitive effects. Therefore, Republic's proposed acquisition of 
Santek is presumptively likely to enhance Republic's market power. See 
Horizontal Merger Guidelines Sec.  5.3.
    34. In addition, the merger would also substantially lessen 
competition through the vertical integration of the two companies. 
Specifically, by combining Republic's strong position in both SCCW 
collection and MSW disposal with Santek's strong position in both SCCW 
collection and MSW disposal, the proposed transaction would increase 
Republic's incentive and ability to harm its SCCW collection rivals by 
raising the costs of MSW disposal in the Chattanooga, Tennessee and 
North Georgia area. With SCCW collection rivals facing higher 
operational costs, they would have to raise their SCCW collection 
prices to offset these costs and would be less able to apply 
competitive pressure on Republic's SCCW collection operations. As a 
result, businesses, municipalities, and other customers likely would 
pay higher prices for SCCW collection. See U.S. Dep't of Justice & Fed. 
Trade Comm'n, Vertical Merger Guidelines Sec.  4(a) (June 30, 2020), 
https://www.justice.gov/atr/page/file/1290686/download.

A. Elimination of Horizontal Competition in SCCW Collection

    35. Republic's acquisition of Santek would eliminate a significant 
competitor for SCCW collection in markets that are already highly 
concentrated and difficult to enter. Republic and Santek compete head-
to-head for SCCW collection customers in the relevant SCCW collection 
markets. In these four geographic markets, Republic and Santek each 
account for a substantial share of total revenue generated from SCCW 
collection and, in each relevant market, are two of no more than five 
significant competitors.
    36. In each relevant SCCW collection market, collection customers 
including offices, apartment buildings, and retail establishments have 
been able to secure better collection rates and improved collection 
service by threatening to switch from Republic to Santek or vice versa. 
In each of the relevant markets, the elimination of this head-to-head 
competition would allow Republic to exercise market power unilaterally 
to increase prices and reduce the quality of service for SCCW 
collection customers.
i. Birmingham, Alabama Area SCCW Collection
    37. In the Birmingham, Alabama area, the proposed acquisition would 
reduce from five to four the number of significant competitors in the 
SCCW collection market. After the acquisition, Defendants would have 
approximately 61 percent of the SCCW collection customers in the 
market. The post-merger HHI for SCCW collection in this market would be 
approximately 4,157, an increase of 445 points from the current HHI.
    ii. Chattanooga, Tennessee and North Georgia Area SCCW Collection
    38. In the Chattanooga, Tennessee and North Georgia area, the 
proposed acquisition would reduce from five to four the number of 
significant competitors in the SCCW collection market. After the 
acquisition, Defendants would have approximately 73 percent of the SCCW 
collection customers in the market. The post-merger HHI for SCCW 
collection in this market would be approximately 5,551, an increase of 
2,660 points from the current HHI.
iii. Eastern Montgomery County, Texas Area SCCW Collection
    39. In the Eastern Montgomery County, Texas area, the proposed 
acquisition would reduce from three to two the number of significant 
competitors in the SCCW collection market. After the acquisition, 
Defendants would have approximately 58 percent of the SCCW collection 
customers in the market. The post-merger HHI for SCCW collection in 
this market would be approximately 4,064, an increase of 1,703 points 
from the current HHI.
iv. Hattiesburg, Mississippi Area SCCW Collection
    40. In the Hattiesburg, Mississippi area, the proposed acquisition 
would reduce from five to four the number of significant competitors in 
the SCCW collection market. After the acquisition, Defendants would 
have approximately 55 percent of SCCW collection customers in the 
market. The post-merger HHI for SCCW collection would be approximately 
3,853, an increase of 1,420 points from the current HHI.

B. Elimination of Horizontal Competition in MSW Disposal

    41. Republic's acquisition of Santek would also eliminate a 
significant competitor for MSW disposal in markets that are already 
highly concentrated and difficult to enter. Republic and Santek compete 
head-to-head for MSW disposal customers in the relevant MSW disposal

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markets. In these geographic markets, Republic and Santek each account 
for a substantial share of total revenue generated from MSW disposal 
and, in each relevant MSW disposal market, are two of no more than 
three significant competitors. In each relevant MSW disposal market, 
independent haulers and municipalities have been able to negotiate more 
favorable MSW disposal rates by threatening to move MSW from Republic's 
facilities to Santek's facilities and vice versa. In each of the 
relevant MSW disposal markets, the elimination of this head-to-head 
competition would allow Republic to exercise market power unilaterally 
to increase prices and reduce the quality of service for MSW disposal 
customers.
i. Chattanooga, Tennessee Area MSW Disposal
    42. In the Chattanooga, Tennessee area, the proposed acquisition 
would reduce from three to two the number of significant competitors in 
the MSW disposal market. After the acquisition, approximately 82 
percent of the waste generated in the Chattanooga, Tennessee area would 
either be disposed of directly in the Defendants' landfills or pass 
through the Defendants' transfer stations in Chattanooga before 
ultimately being disposed of in the Defendants' landfills. The post-
merger HHI for MSW disposal would be approximately 6,980, an increase 
of 3,018 points from the current HHI.
ii. Estill Springs and Fayetteville, Tennessee Area MSW Disposal
    43. MSW in the Estill Springs and Fayetteville, Tennessee area, is 
hauled to municipally-owned transfer stations before it is transferred 
to a landfill. The proposed acquisition would reduce from three to two 
the number of significant landfill competitors available to bid to 
dispose of the MSW from these transfer stations. Since Santek was 
awarded the most recent contracts for the exclusive right to dispose of 
the waste from the Estill Springs and Fayetteville, Tennessee area's 
municipally-owned transfer stations, the transaction will not have an 
impact on the market's HHI. Still, the loss of competition between 
Republic and Santek for the area's contracts will result in higher 
prices and lower quality service for these municipalities in the 
upcoming years when the current contracts expire.

C. Raising Rivals' Costs of MSW Disposal in the Chattanooga, Tennessee 
and North Georgia Area

    44. In the Chattanooga, Tennessee and North Georgia area, the 
proposed transaction also would substantially lessen competition in the 
SCCW collection market by raising the MSW disposal costs of independent 
haulers.
    45. As noted above, Republic and Santek collectively serve 
approximately 73 percent of the SCCW collection customers in the 
Chattanooga, Tennessee and North Georgia area. In addition, the vast 
majority of the waste generated in this area is disposed of in 
landfills operated by Republic and Santek. Thus, not only are 
Defendants each other's largest competitor in the SCCW collection 
market, they also compete with each other to supply MSW disposal 
services to independent haulers, including those that compete with them 
in the SCCW collection market.
    46. By combining the two firms' SCCW collection and MSW disposal 
businesses, the merger would increase Republic's incentive and ability 
to raise its MSW disposal price for independent haulers. Having 
acquired its largest MSW disposal competitor, Santek, Republic would be 
able to raise its MSW disposal prices without fear of losing 
significant sales to remaining disposal competitors. With few 
alternative MSW disposal facilities available, independent haulers 
would be forced to incur these increased MSW disposal costs or shutter 
their operations. Those independent haulers that remained in business 
would need to raise their SCCW collection prices in order to offset 
higher MSW disposal costs, rendering them less competitive in SCCW 
collection. The merger would also increase Republic's incentive to 
raise the MSW disposal costs of independent haulers because Republic--
no longer confronting competition from Santek in SCCW collection--would 
capture more of the business lost by independent haulers in the SCCW 
collection market.
    47. As a result, the merged firm would likely find it profitable to 
raise the cost of MSW disposal or to deny service altogether to the 
merged firm's SCCW collection rivals, thereby reducing competition in 
the SCCW collection market.

VI. Entry

A. Difficulty of Entry Into Small Container Commercial Waste Collection

    48. Entry of new competitors into the relevant SCCW collection 
markets would be difficult and time-consuming and is unlikely to 
prevent the harm to competition that is likely to result if the 
proposed transaction is consummated.
    49. A new entrant in SCCW collection could not provide a 
significant competitive constraint on the prices that market incumbents 
charge until achieving a minimum efficient scale and operating 
efficiency comparable to existing competitors. In order to obtain a 
comparable operating efficiency, a new competitor would have to achieve 
route densities similar to those of firms already in the market. 
Incumbents in a geographic market, however, can prevent new entrants 
from winning a large enough base of customers by selectively lowering 
prices and entering into longer term contracts with collection 
customers.

B. Difficulty of Entry Into Municipal Solid Waste Disposal

    50. Entry of new competitors into the relevant MSW disposal markets 
would be difficult and time-consuming and is unlikely to prevent the 
harm to competition that is likely to result if the proposed 
transaction is consummated.
    51. A new entrant in MSW disposal would need to obtain a permit to 
construct an MSW disposal facility or to expand an existing one, and 
this process is costly and time-consuming, typically taking many years. 
Land suitable for MSW disposal is scarce, as a landfill must be 
constructed away from environmentally-sensitive areas, including fault 
zones, wetlands, flood plains, and other restricted areas. Even when 
suitable land is available, local public opposition frequently 
increases the time and uncertainty of the permitting process.
    52. Construction of a new transfer station or incinerator also is 
difficult and time consuming and faces many of the same challenges as 
new landfill construction, including local public opposition.
    53. Entry by constructing and permitting a new MSW disposal 
facility would thus be costly and time-consuming and unlikely to 
prevent market incumbents from significantly raising prices for MSW 
disposal in each of the relevant MSW disposal markets following the 
acquisition.

VII. Violations Alleged

    54. Republic's proposed acquisition of Santek is likely to 
substantially lessen competition in each of the relevant markets set 
forth above in violation of Section 7 of the Clayton Act, 15 U.S.C. 18.
    55. The acquisition will likely have the following anticompetitive 
effects, among others, in the relevant markets:
    a. Actual and potential competition between Republic and Santek 
will be eliminated;
    b. competition generally will be substantially lessened; and

[[Page 18305]]

    c. prices will likely increase and quality and the level of service 
will likely decrease.

VIII. Request for Relief

    56. The United States and the State of Alabama request that this 
Court:
    a. Adjudge and decree Republic's acquisition of Santek to be 
unlawful and in violation of Section 7 of the Clayton Act, 15 U.S.C. 
18;
    b. preliminarily and permanently enjoin Defendants and all persons 
acting on their behalf from consummating the proposed acquisition by 
Republic of Santek or from entering into or carrying out any other 
contract, agreement, plan, or understanding, the effect of which would 
be to combine Republic with Santek;
    c. award the United States and the State of Alabama the costs for 
this action; and
    d. grant the United States and the State of Alabama such other 
relief as the Court deems just and proper.

Dated: March 31, 2021

Respectfully submitted,

Counsel for Plaintiff United States:

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Richard Powers,
Acting Assistant Attorney General, Antitrust Division.

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Kathleen S. O'Neil,
Senior Director of Investigations and Litigation, Antitrust 
Division.

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Katrina Rouse (D.C. Bar #1013035),
Chief, Defense, Industrials, and Aerospace Section Antitrust 
Division.

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Jay D. Owen,
Assistant Chief, Defense, Industrials, and Aerospace Section, 
Antitrust Division.

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Gabriella R. Moskowitz * (D.C. Bar #1044309)
Stephen Harris
Kevin Quin (D.C. Bar #415268)

Trial Attorneys

Defense, Industrials, and Aerospace Section, Antitrust Division, 450 
Fifth Street NW, Suite 8700, Washington, DC 20530, Telephone: (202) 
598-2294, Facsimile: (202) 514-9033, Email: 
[email protected]

* Lead Attorney To Be Noticed

For Plaintiff State of Alabama:

Steve Marshall,
Attorney General.

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John A. Selden (AL Bar #5608C63A) (D.C. Bar #1022301),
Assistant Attorney General.

Office of the Attorney General, Consumer Interest Division, 501 
Washington Avenue, Montgomery, AL 36130, Telephone: (334) 353-0065, 
Facsimile: (334) 353-8400, Email: [email protected]

Appendix A: Definition of the Herfindahl-Hirschman Index

    ``HHI'' means the Herfindahl-Hirschman Index, a commonly 
accepted measure of market concentration. It is calculated by 
squaring the market share of each firm competing in the market and 
then summing the resulting numbers. For example, for a market 
consisting of four firms with shares of 30 percent, 30 percent, 20 
percent, and 20 percent, the HHI is 2,600 (30\2\ + 30\2\ + 20\2\ + 
20\2\ = 2,600). The HHI takes into account the relative size 
distribution of the firms in a market and approaches zero when a 
market consists of a large number of small firms. The HHI increases 
both as the number of firms in the market decreases and as the 
disparity in size between those firms increases. Markets in which 
the HHI is above 2,500 are considered to be highly concentrated. See 
Horizontal Merger Guidelines Sec.  5.3. Transactions that increase 
the HHI by more than 200 points in highly concentrated markets are 
presumed to be likely to enhance market power under the guidelines 
issued by the U.S. Department of Justice and Federal Trade 
Commission. See id.

United States District Court for the District of Columbia

    United States of America and State of Alabama, Plaintiffs, v. 
Republic Services, Inc. and Santek Waste Services, LLC, Defendants.

Civil Action No.: 1:21-cv-00883-RDM
Judge: Randolph D. Moss

Proposed Final Judgment

    Whereas, Plaintiffs, United States of America and the State of 
Alabama, filed their Complaint on March 31, 2021;
    And whereas, the United States, the State of Alabama, and 
Defendants, Republic Services, Inc. (``Republic'') and Santek Waste 
Services, LLC. (``Santek''), have consented to entry of this Final 
Judgment without the taking of testimony, without trial or adjudication 
of any issue of fact or law, and without this Final Judgment 
constituting any evidence against or admission by any party regarding 
any issue of fact or law;
    And whereas, Defendants agree to make certain divestitures to 
remedy the loss of competition alleged in the Complaint;
    And whereas, Defendants represent that the divestitures and other 
relief required by this Final Judgment can and will be made and that 
Defendants will not later raise a claim of hardship or difficulty as 
grounds for asking the Court to modify any provision of this Final 
Judgment;
    Now therefore, it is ordered, adjudged, and decreed:

I. Jurisdiction

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

II. Definitions

    As used in this Final Judgment:
    A. ``Republic'' means Defendant Republic Services, Inc., a Delaware 
corporation with its headquarters in Phoenix, Arizona, its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    B. ``Santek'' means Defendant Santek Waste Services, LLC, a 
Tennessee limited liability company with its headquarters in Cleveland, 
Tennessee, its successors and assigns, and its subsidiaries, divisions, 
groups, affiliates, partnerships, and joint ventures, and their 
directors, officers, managers, agents, and employees.
    C. ``CWS'' means Capital Waste Services, LLC, a portfolio company 
of Kinderhook and a Delaware limited liability company with its 
headquarters in Columbia, South Carolina, its successors and assigns, 
and its subsidiaries, divisions, groups, affiliates, partnerships, and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    D. ``EcoSouth'' means EcoSouth Services of Birmingham and EcoSouth 
Services of Mobile.
    E. ``EcoSouth of Birmingham'' means EcoSouth Services of 
Birmingham, LLC, a portfolio company of Kinderhook and a Delaware 
limited liability company with its headquarters in Birmingham, Alabama, 
its successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.
    F. ``EcoSouth of Mobile'' means EcoSouth Services of Mobile, LLC, a 
portfolio company of Kinderhook and an Alabama limited liability 
company with its headquarters in Axis, Alabama, its successors and 
assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    G. ``Kinderhook'' means Kinderhook Industries LLC, a Delaware 
limited liability company with its headquarters in New York, New York, 
its successors and assigns, and its subsidiaries, portfolio companies 
(including but not limited to CWS and EcoSouth), divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.

[[Page 18306]]

    H. ``Waste Connections'' means Waste Connections, Inc., a Canadian 
corporation with its headquarters in Ontario, Canada, its successors 
and assigns, and its subsidiaries (including but not limited to Waste 
Connections of Texas), divisions, groups, affiliates, partnerships, and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    I. ``Waste Connections of Texas'' means Waste Connections of Texas, 
LLC, a subsidiary of Waste Connections and a Delaware limited liability 
company with its headquarters in The Woodlands, Texas, its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    J. ``Divestiture Assets'' means the Southeast Divestiture Assets 
and the Texas Divestiture Assets.
    K. ``Southeast Divestiture Assets'' means all of Defendants' 
rights, titles, and interests in and to:
    1. The transfer stations and landfills listed in Appendix A;
    2. all property and assets, tangible and intangible, wherever 
located, related to or used in connection with the transfer stations 
and landfills listed in Appendix A, including but not limited to:
    a. All real property, including but not limited to fee simple 
interests, real property leasehold interests and renewal rights 
thereto, improvements to real property, and options to purchase any 
adjoining or other property, together with all offices, garages, 
material recovery facilities, and other related facilities;
    b. all tangible personal property, including but not limited to 
capital equipment, trucks and other vehicles, scales, power supply 
equipment, and office furniture, materials, and supplies;
    c. all contracts, contractual rights, and customer relationships; 
and all other agreements, commitments, and understandings;
    d. all licenses, permits, certifications, approvals, consents, 
authorizations, and registrations and all pending applications or 
renewals; and
    e. all records and data, including but not limited to customer 
lists, accounts, credits records, and repair and performance records;
    3. the collection facilities and Routes listed in Appendix A; and
    4. all property and assets, tangible and intangible, wherever 
located, related to or used in connection with the Routes listed in 
Appendix A, including but not limited to:
    a. All real property, including but not limited to fee simple 
interests, real property leasehold interests and renewal rights 
thereto, improvements to real property, and options to purchase any 
adjoining or other property, together with all offices, garages, and 
related facilities;
    b. all tangible personal property, including but not limited to 
capital equipment, vehicles, and containers assigned to Routes listed 
in Appendix A, and, at the option of the Acquirer of the Southeast 
Divestiture Assets, spare vehicles and containers, scales, power supply 
equipment, and office furniture, materials, and supplies;
    c. all contracts (except Hybrid Contracts), contractual rights, and 
customer relationships; and all other agreements, commitments, and 
understandings;
    d. all licenses, permits, certifications, approvals, consents, and 
authorizations, and all pending applications or renewals; and
    e. all records and data, including but not limited to customer 
lists, accounts, and credits records, and repair and performance 
records; provided, however, that the assets specified in Paragraphs 
II(K)(4)(a)-(e) above do not include the collection facility located at 
101 Barber Boulevard, Gardendale, Alabama 35071 or the Excluded 
Disposal Agreements.
    L. ``Texas Divestiture Assets'' means all of Defendants' rights, 
titles, and interests in and to:
    1. Santek SCCW Collection Routes 902 and 903 (``Routes 902 and 
903''); and
    2. all property and assets, tangible and intangible, wherever 
located, related to or used in connection with the Routes 902 and 903, 
including but not limited to:
    a. All tangible personal property, including but not limited to 
capital equipment, vehicles, and containers assigned to Routes 902 or 
903, and, at the option of the Acquirer of the Texas Divestiture 
Assets, spare vehicles and containers;
    b. all contracts, contractual rights, and customer relationships; 
and all other agreements, commitments, and understandings;
    c. all licenses, permits, certifications, approvals, consents, and 
authorizations, and all pending applications or renewals; and
    d. all records and data, including but not limited to customer 
lists, accounts, and credits records, and repair and performance 
records; provided, however, that the assets specified in Paragraphs 
II(L)(2)(a)-(d) above do not include the collection facility located at 
701 US Hwy 59 South, Cleveland, Texas 77327.
    M. ``Acquirer'' or ``Acquirers'' means the Acquirer of the 
Southeast Divestiture Assets and the Acquirer of the Texas Divestiture 
Assets.
    N. ``Acquirer of the Southeast Divestiture Assets'' means 
Kinderhook, including CWS and EcoSouth, or another entity to whom 
Defendants divest the Southeast Divestiture Assets.
    O. ``Acquirer of the Texas Divestiture Assets'' means Waste 
Connections, including Waste Connections of Texas, or another entity to 
whom Defendants divest the Texas Divestiture Assets.
    P. ``Commercial Recycling Collection'' means the business of 
collecting recyclables, which are discarded materials that will be 
processed and reused, from commercial and industrial accounts and 
transporting those recyclables to a recycling site (typically called a 
``materials recovery facility,'' or ``MRF'').
    Q. ``Disposal'' means the business of disposing of waste into 
disposal sites, including the use of transfer stations to facilitate 
shipment of waste to other disposal sites.
    R. ``Excluded Disposal Agreements'' means (1) the Landfill Disposal 
Services Agreement, dated December 1, 2012, between Putnam County, 
Tennessee and Santek Environmental, Inc., as amended by First Amendment 
to Landfill Disposal Services Agreement, dated October 16, 2020, and 
(2) the Waste Disposal Agreement, dated November 16, 2018, between 
Santek Environmental, LLC and Clean Harbors Environmental Services, 
Inc., as amended by First Amendment to Waste Disposal Agreement, dated 
January 26, 2021.
    S. ``Hybrid Contracts'' means customer waste or recycling 
collection contacts that include a combination of services and/or 
collection stops included in the Southeast Divestiture Assets and 
services and/or collection stops not included in the Southeast 
Divestiture Assets.
    T. ``MSW'' means municipal solid waste. Municipal solid waste is a 
term of art used to describe solid putrescible waste generated by 
households and commercial establishments such as retail stores, 
offices, restaurants, warehouses, and non-manufacturing activities in 
industrial facilities. MSW does not include special handling waste 
(e.g., waste from manufacturing processes, regulated medical waste, 
sewage, and sludge), hazardous waste, or waste generated by 
construction or demolition sites.
    U. ``Route'' means a group of customers receiving regularly 
scheduled waste collection service as of February 23, 2021, including 
customers from that

[[Page 18307]]

group for whom service has been suspended due to issues related to 
COVID-19 and any customers added to that group between February 23, 
2021, and the date that the Route is divested to an Acquirer.
    V. ``Small Container Commercial Waste Collection'' (or ``SCCW 
Collection'') means the business of collecting MSW from commercial and 
industrial accounts, usually in ``dumpsters'' (i.e., small containers 
with one-to-ten cubic yards of storage capacity), and transporting--or 
``hauling''--that waste to a disposal site, typically by use of a 
front-end, side-load, or rear-end truck. Typical SCCW Collection 
customers include office and apartment buildings and retail 
establishments (e.g., stores and restaurants).
    W. ``Southeast Divestiture Date'' means the date on which the 
Southeast Divestiture Assets are divested to the Acquirer of the 
Southeast Divestiture Assets.
    X. ``Southeast Personnel'' means all full-time, part-time, or 
contract employees wherever located, involved in the MSW Disposal, SCCW 
Collection, and Commercial Recycling Collection services provided for a 
Route or facility included in the Southeast Divestiture Assets at any 
time between February 18, 2020 and the Southeast Divestiture Date. The 
United States, in its sole discretion, will resolve any disagreement 
regarding which employees are Southeast Personnel.
    Y. ``Texas Divestiture Date'' means the date on which the Texas 
Divestiture Assets are divested to the Acquirer of the Texas 
Divestiture Assets.
    Z. ``Texas Personnel'' means all full-time, part-time, or contract 
employees of Santek, wherever located, involved in the SCCW Collection 
services provided for a Route included in the Texas Divestiture Assets 
at any time between February 18, 2020 and the Texas Divestiture Date. 
The United States, in its sole discretion, will resolve any 
disagreement regarding which employees are Texas Personnel.

III. Applicability

    A. This Final Judgment applies to Republic and Santek, as defined 
above, and all other persons, in active concert or participation with 
any Defendant, who receive actual notice of this Final Judgment.
    B. If, prior to complying with Sections IV, V, and VI of this Final 
Judgment, Defendants sell or otherwise dispose of all or substantially 
all of their assets or of business units that include the Divestiture 
Assets, Defendants must require any purchaser to be bound by the 
provisions of this Final Judgment. Defendants need not obtain such an 
agreement from the Acquirers.

IV. Divestiture of the Southeast Divestiture Assets

    A. Defendants are ordered and directed, within thirty (30) calendar 
days after the Court's entry of the Asset Preservation Stipulation and 
Order in this matter, to divest the Southeast Divestiture Assets in a 
manner consistent with this Final Judgment to Kinderhook (through its 
portfolio companies, CWS or EcoSouth) or another Acquirer acceptable to 
the United States, in its sole discretion, after consultation with the 
State of Alabama. The United States, in its sole discretion, may agree 
to one or more extensions of this time period, not to exceed sixty (60) 
calendar days in total, and will notify the Court of any extensions.
    B. Defendants must use their best efforts to divest the Southeast 
Divestiture Assets as expeditiously as possible and may not take any 
action to impede the permitting, operation, or divestiture of the 
Southeast Divestiture Assets.
    C. Unless the United States otherwise consents in writing, 
divestiture pursuant to this Final Judgment must include the entire 
Southeast Divestiture Assets and must be accomplished in such a way as 
to satisfy the United States, in its sole discretion, after 
consultation with the State of Alabama, that the Southeast Divestiture 
Assets can and will be used by the Acquirer of the Southeast 
Divestiture Assets as part of a viable, ongoing business of MSW 
Disposal and a viable, ongoing business of SCCW Collection and that the 
divestiture to the Acquirer of the Southeast Divestiture Assets will 
remedy the competitive harm alleged in the Complaint.
    D. The divestiture must be made to an Acquirer that, in the United 
States' sole judgment, after consultation with the State of Alabama, 
has the intent and capability (including the necessary managerial, 
operational, technical, and financial capability) to compete 
effectively in the business of MSW Disposal and SCCW Collection.
    E. The divestiture must be accomplished so as to satisfy the United 
States, in its sole discretion, after consultation with the State of 
Alabama, that none of the terms of any agreement between the Acquirer 
of the Southeast Divestiture Assets and Defendants give Defendants the 
ability unreasonably to raise the costs of the Acquirer of the 
Southeast Divestiture Assets, to lower the efficiency of the Acquirer 
of the Southeast Divestiture Assets, or otherwise to interfere in the 
ability of the Acquirer of the Southeast Divestiture Assets to compete 
effectively in the business of MSW Disposal and SCCW Collection.
    F. Divestiture of the Southeast Divestiture Assets may be made to 
one or more Acquirers, provided that it is demonstrated to the sole 
satisfaction of the United States, after consultation with the State of 
Alabama, that the criteria required by Paragraphs IV(C), IV(D), and 
IV(E) will still be met.
    G. In the event Defendants are attempting to divest the Southeast 
Divestiture Assets to an Acquirer other than Kinderhook (through its 
portfolio companies, CWS or EcoSouth), Defendants promptly must make 
known, by usual and customary means, the availability of the Southeast 
Divestiture Assets. Defendants must inform any person making an inquiry 
regarding a possible purchase of the Southeast Divestiture Assets that 
the Southeast Divestiture Assets are being divested in accordance with 
this Final Judgment and must provide that person with a copy of this 
Final Judgment. Defendants must offer to furnish to all prospective 
Acquirers of the Southeast Divestiture Assets, subject to customary 
confidentiality assurances, all information and documents relating to 
the Southeast Divestiture Assets that are customarily provided in a 
due-diligence process; provided, however, that Defendants need not 
provide information or documents subject to the attorney-client 
privilege or work-product doctrine. Defendants must make all 
information and documents available to Plaintiffs at the same time that 
the information and documents are made available to any other person.
    H. Defendants must provide prospective Acquirers of the Southeast 
Divestiture Assets with (1) access to make inspections of the Southeast 
Divestiture Assets; (2) access to all environmental, zoning, and other 
permitting documents and information; and (3) access to all financial, 
operational, or other documents and information customarily provided as 
part of a due diligence process. Defendants also must disclose all 
encumbrances on any part of the Southeast Divestiture Assets, including 
on intangible property.
    I. Defendants must cooperate with and assist the Acquirer of the 
Southeast Divestiture Assets in identifying and, at the option of the 
Acquirer of the Southeast Divestiture Assets, hiring all Southeast 
Personnel.
    1. Within ten (10) business days following the filing of the 
Complaint in this matter, Defendants must identify all

[[Page 18308]]

Southeast Personnel to the Acquirer of the Southeast Divestiture Assets 
and Plaintiffs, including by providing organization charts covering all 
Southeast Personnel.
    2. Within ten (10) business days following receipt of a request by 
the Acquirer of the Southeast Divestiture Assets or the United States, 
Defendants must provide to the Acquirer of the Southeast Divestiture 
Assets and Plaintiffs additional information related to Southeast 
Personnel, including name, job title, reporting relationships, past 
experience, responsibilities, training and educational history, 
relevant certifications, job performance evaluations. Defendants must 
also provide to the Acquirer of the Southeast Divestiture Assets and 
Plaintiffs current, recent, and accrued compensation and benefits, 
including most recent bonuses paid, aggregate annual compensation, 
current target or guaranteed bonus, if any, any retention agreement or 
incentives, and any other payments due, compensation or benefits 
accrued, or promises made to Southeast Personnel. If Defendants are 
barred by any applicable law from providing any of this information, 
within ten (10) business days following receipt of the request, 
Defendants must provide the requested information to the full extent 
permitted by law and also must provide a written explanation of 
Defendants' inability to provide the remaining information, including 
specifically identifying the provisions of applicable laws.
    3. At the request of the Acquirer of the Southeast Divestiture 
Assets, Defendants must promptly make Southeast Personnel available for 
private interviews with the Acquirer of the Southeast Divestiture 
Assets during normal business hours at a mutually agreeable location.
    4. Defendants must not interfere with any effort by the Acquirer of 
the Southeast Divestiture Assets to employ any Southeast Personnel. 
Interference includes but is not limited to offering to increase the 
compensation or improve the benefits of Southeast Personnel unless: (a) 
The offer is part of a company-wide increase in compensation or 
improvement in benefits that was announced prior to February 18, 2020; 
or (b) the offer is approved by the United States in its sole 
discretion. Defendants' obligations under this Paragraph will expire 
six (6) months after the divestiture of the Southeast Divestiture 
Assets pursuant to this Final Judgment.
    5. For Southeast Personnel who elect employment with the Acquirer 
of the Southeast Divestiture Assets within six (6) months of the 
Southeast Divestiture Date, Defendants must waive all non-compete and 
non-disclosure agreements, vest all unvested pension and other equity 
rights, provide any pay pro-rata, provide all other compensation and 
benefits that those Southeast Personnel have fully or partially 
accrued, and provide all other benefits that those Southeast Personnel 
otherwise would have been provided had the Southeast Personnel 
continued employment with Defendants, including but not limited to any 
retention bonuses or payments. Defendants may maintain reasonable 
restrictions on disclosure by Southeast Personnel of Defendants' 
proprietary non-public information that is unrelated to the business of 
MSW Disposal, SCCW Collection, and Commercial Recycling Collection and 
not otherwise required to be disclosed by this Final Judgment.
    6. For a period of twelve (12) months from the Southeast 
Divestiture Date, Defendants may not solicit to rehire Southeast 
Personnel who were hired by the Acquirer of the Southeast Divestiture 
Assets within six (6) months of the Southeast Divestiture Date unless 
(a) an individual is terminated or laid off by the Acquirer of the 
Southeast Divestiture Assets or (b) the Acquirer of the Southeast 
Divestiture Assets agrees in writing that Defendants may solicit to 
rehire that individual. Nothing in this Paragraph prohibits Defendants 
from advertising employment openings using general solicitations or 
advertisements and rehiring Southeast Personnel who apply for an 
employment opening through a general solicitation or advertisement.
    J. Defendants must warrant to the Acquirer of the Southeast 
Divestiture Assets that (1) the Southeast Divestiture Assets will be 
operational and without material defect on the Southeast Divestiture 
Date; (2) there are no material defects in the environmental, zoning, 
or other permits pertaining to the operation of the Southeast 
Divestiture Assets; and (3) Defendants have disclosed all encumbrances 
on any part of the Southeast Divestiture Assets, including on 
intangible property. Following the sale of the Southeast Divestiture 
Assets, Defendants must not undertake, directly or indirectly, 
challenges to the environmental, zoning, or other permits pertaining to 
the operation of the Southeast Divestiture Assets.
    K. Defendants must assign, subcontract, or otherwise transfer all 
contracts (except Hybrid Contracts and the Excluded Disposal 
Agreements), agreements, and relationships (or portions of such 
contracts, agreements, and relationships) included in the Southeast 
Divestiture Assets, including but not limited to all supply and sales 
contracts, to the Acquirer of the Southeast Divestiture Assets; 
provided, however, that for any contract or agreement that requires the 
consent of another party to assign, subcontract, or otherwise transfer, 
Defendants must use best efforts to accomplish the assignment, 
subcontracting, or transfer. Defendants must not interfere with any 
negotiations between the Acquirer of the Southeast Divestiture Assets 
and a contracting party.
    L. At the option of the Acquirer of the Southeast Divestiture 
Assets, and subject to approval by the United States in its sole 
discretion, on or before the Southeast Divestiture Date, Defendants 
must assign, subcontract, or otherwise transfer all Hybrid Contracts; 
provided, however, that for any Hybrid Contract that requires the 
consent of another party to assign, subcontract, or otherwise transfer, 
Defendants must use best efforts to accomplish the assignment, 
subcontracting, or other transfer. Defendants must not interfere with 
any negotiations between the Acquirer of the Southeast Divestiture 
Assets and a contracting party.
    M. Defendants must make best efforts to assist the Acquirer of the 
Southeast Divestiture Assets to obtain all necessary licenses, 
registrations, and permits to operate the Southeast Divestiture Assets. 
Until the Acquirer of the Southeast Divestiture Assets obtains the 
necessary licenses, registrations, and permits, Defendants must provide 
the Acquirer of the Southeast Divestiture Assets with the benefit of 
Defendants' licenses, registrations, and permits to the full extent 
permissible by law.
    N. At the option of the Acquirer of the Southeast Divestiture 
Assets, and subject to approval by the United States in its sole 
discretion, on or before the Southeast Divestiture Date, Defendants 
must enter into a contract to provide transition services for back 
office, human resources, accounting, employee health and safety, 
telephone and information technology services and support for a period 
of up to three (3) months on terms and conditions reasonably related to 
market conditions for the provision of the transition services. Any 
amendments to or modifications of any provisions of a contract for 
transition services are subject to approval by the United States, in 
its sole discretion. The United States, in its sole discretion, may 
approve one or more extensions of any contract for transition services, 
for a total of up to an additional three (3) months. If the Acquirer of 
the Southeast Divestiture

[[Page 18309]]

Assets seeks an extension of the term of any transition services 
agreement, Defendants must notify the United States in writing at least 
fifteen (15) days prior to the date the contract expires. The Acquirer 
of the Southeast Divestiture Assets may terminate a contract for 
transition services, or any portion of a contract for transition 
services, without cost or penalty at any time upon thirty (30) days' 
written notice to Republic. The employee(s) of Defendants tasked with 
providing transition services must not share any competitively 
sensitive information of the Acquirer of the Southeast Divestiture 
Assets with any other employee of Defendants.
    O. At the option of the Acquirer of the Southeast Divestiture 
Assets, and subject to approval by the United States in its sole 
discretion, on or before the Southeast Divestiture Date, Defendants 
must enter into a landfill disposal contract to provide rights to 
landfill disposal at Republic's Pineview Landfill, located at 2730 
Bryan Road, Dora, Alabama 35062 and Santek's Mt. Olive Landfill, 
located at 101 Barber Boulevard, Gardendale, Alabama 35071. The 
landfill disposal contract must allow the Acquirer of the Southeast 
Divestiture Assets to dispose up to a total of 100,000 tons of MSW per 
year at the Pineview Landfill and Mt. Olive Landfill for a period of up 
to three (3) years from the Southeast Divestiture Date. Defendants must 
operate the Pineview Landfill and Mt. Olive Landfill gates, scale 
houses, and disposal areas for the benefit of the Acquirer of the 
Southeast Divestiture Assets under terms and conditions no less 
favorable than those that Defendants provide to their own vehicles. The 
Acquirer of the Southeast Divestiture Assets may terminate a contract 
for landfill disposal without cost or penalty at any time upon thirty 
(30) days' written notice to Republic.
    P. At the option of the Acquirer of the Southeast Divestiture 
Assets, and subject to approval by the United States in its sole 
discretion, on or before the Southeast Divestiture Date, Defendants 
must enter into an agreement to provide the Acquirer of the Southeast 
Divestiture Assets, for a period of up to six (6) months from the 
Southeast Divestiture Date, the exclusive use of one maintenance bay, 
outdoor parking for six trucks and empty container storage, and an 
interior office at Republic's collection facility located at 3950 50th 
Street SW, Birmingham, Alabama 35221.
    Q. If any term of an agreement between Defendants and the Acquirer 
of the Southeast Divestiture Assets, including but not limited to an 
agreement to effectuate the divestiture required by this Final 
Judgment, varies from a term of this Final Judgment, to the extent that 
Defendants cannot fully comply with both, this Final Judgment 
determines Defendants' obligations.

V. Divestiture of the Texas Divestiture Assets

    A. Defendants are ordered and directed, within thirty (30) calendar 
days after the Court's entry of the Asset Preservation Stipulation and 
Order in this matter, to divest the Texas Divestiture Assets in a 
manner consistent with this Final Judgment to Waste Connections 
(through its subsidiary Waste Connections of Texas) or another Acquirer 
acceptable to the United States, in its sole discretion. The United 
States, in its sole discretion, may agree to one or more extensions of 
this time period, not to exceed sixty (60) calendar days in total, and 
will notify the Court of any extensions.
    B. Defendants must use their best efforts to divest the Texas 
Divestiture Assets as expeditiously as possible and may not take any 
action to impede the permitting, operation, or divestiture of the Texas 
Divestiture Assets.
    C. Unless the United States otherwise consents in writing, 
divestiture pursuant to this Final Judgment must include the entire 
Texas Divestiture Assets and must be accomplished in such a way as to 
satisfy the United States, in its sole discretion, that the Texas 
Divestiture Assets can and will be used by the Acquirer of the Texas 
Divestiture Assets as part of a viable, ongoing SCCW Collection 
business and that the divestiture to the Acquirer of the Texas 
Divestiture Assets will remedy the competitive harm alleged in the 
Complaint.
    D. The divestiture must be made to an Acquirer that, in the United 
States' sole judgment, has the intent and capability (including the 
necessary managerial, operational, technical, and financial capability) 
to compete effectively in the business of SCCW Collection.
    E. The divestiture must be accomplished so as to satisfy the United 
States, in its sole discretion, that none of the terms of any agreement 
between the Acquirer of the Texas Divestiture Assets and Defendants 
give Defendants the ability unreasonably to raise the costs of the 
Acquirer of the Texas Divestiture Assets, to lower the efficiency of 
the Acquirer of the Texas Divestiture Assets, or otherwise to interfere 
in the ability of the Acquirer of the Texas Divestiture Assets to 
compete effectively in the business of SCCW Collection.
    F. In the event Defendants are attempting to divest the Texas 
Divestiture Assets to an Acquirer other than Waste Connections (through 
its subsidiary Waste Connections of Texas), Defendants promptly must 
make known, by usual and customary means, the availability of the Texas 
Divestiture Assets. Defendants must inform any person making an inquiry 
regarding a possible purchase of the Texas Divestiture Assets that the 
Texas Divestiture Assets are being divested in accordance with this 
Final Judgment and must provide that person with a copy of this Final 
Judgment. Defendants must offer to furnish to all prospective Acquirers 
of the Texas Divestiture Assets, subject to customary confidentiality 
assurances, all information and documents relating to the Texas 
Divestiture Assets that are customarily provided in a due-diligence 
process; provided, however, that Defendants need not provide 
information or documents subject to the attorney-client privilege or 
work-product doctrine. Defendants must make all information and 
documents available to the United States at the same time that the 
information and documents are made available to any other person.
    G. Defendants must provide prospective Acquirers of the Texas 
Divestiture Assets with (1) access to make inspections of the Texas 
Divestiture Assets; (2) access to all environmental, zoning, and other 
permitting documents and information; and (3) access to all financial, 
operational, or other documents and information customarily provided as 
part of a due diligence process. Defendants also must disclose all 
encumbrances on any part of the Texas Divestiture Assets, including on 
intangible property.
    H. Defendants must cooperate with and assist the Acquirer of the 
Texas Divestiture Assets in identifying and, at the option of the 
Acquirer of the Texas Divestiture Assets, hiring all Texas Personnel.
    1. Within ten (10) business days following the filing of the 
Complaint in this matter, Defendants must identify all Texas Personnel 
to the Acquirer of the Texas Divestiture Assets and the United States, 
including by providing organization charts covering all Texas 
Personnel.
    2. Within ten (10) business days following receipt of a request by 
the Acquirer of the Texas Divestiture Assets or the United States, 
Defendants must provide to the Acquirer of the Texas Divestiture Assets 
and the United States additional information related to Texas

[[Page 18310]]

Personnel, including name, job title, reporting relationships, past 
experience, responsibilities, training and educational history, 
relevant certifications, job performance evaluations. Defendants must 
also provide to the Acquirer of the Texas Divestiture Assets and the 
United States current, recent, and accrued compensation and benefits, 
including most recent bonuses paid, aggregate annual compensation, 
current target or guaranteed bonus, if any, any retention agreement or 
incentives, and any other payments due, compensation or benefits 
accrued, or promises made to Texas Personnel. If Defendants are barred 
by any applicable law from providing any of this information, within 
ten (10) business days following receipt of the request, Defendants 
must provide the requested information to the full extent permitted by 
law and also must provide a written explanation of Defendants' 
inability to provide the remaining information, including specifically 
identifying the provisions of applicable laws.
    3. At the request of the Acquirer of the Texas Divestiture Assets, 
Defendants must promptly make Texas Personnel available for private 
interviews with the Acquirer of the Texas Divestiture Assets during 
normal business hours at a mutually agreeable location.
    4. Defendants must not interfere with any effort by the Acquirer of 
the Texas Divestiture Assets to employ any Texas Personnel. 
Interference includes but is not limited to offering to increase the 
compensation or improve the benefits of Texas Personnel unless: (a) The 
offer is part of a company-wide increase in compensation or improvement 
in benefits that was announced prior to February 18, 2020; or (b) the 
offer is approved by the United States in its sole discretion. 
Defendants' obligations under this Paragraph will expire six (6) months 
after the divestiture of the Texas Divestiture Assets pursuant to this 
Final Judgment.
    5. For Texas Personnel who elect employment with the Acquirer of 
the Texas Divestiture Assets within six (6) months of the Texas 
Divestiture Date, Defendants must waive all non-compete and non-
disclosure agreements, vest all unvested pension and other equity 
rights, provide any pay pro-rata, provide all other compensation and 
benefits that those Texas Personnel have fully or partially accrued, 
and provide all other benefits that those Texas Personnel otherwise 
would have been provided had the Texas Personnel continued employment 
with Defendants, including but not limited to any retention bonuses or 
payments. Defendants may maintain reasonable restrictions on disclosure 
by Texas Personnel of Defendants' proprietary non-public information 
that is unrelated to the business of SCCW Collection and not otherwise 
required to be disclosed by this Final Judgment.
    6. For a period of twelve (12) months from the Texas Divestiture 
Date, Defendants may not solicit to rehire Texas Personnel who were 
hired by the Acquirer of the Texas Divestiture Assets within six (6) 
months of the Texas Divestiture Date unless (a) an individual is 
terminated or laid off by the Acquirer of the Texas Divestiture Assets 
or (b) the Acquirer of the Texas Divestiture Assets agrees in writing 
that Defendants may solicit to rehire that individual. Nothing in this 
Paragraph prohibits Defendants from advertising employment openings 
using general solicitations or advertisements and rehiring Texas 
Personnel who apply for an employment opening through a general 
solicitation or advertisement.
    I. Defendants must warrant to the Acquirer of the Texas Divestiture 
Assets that (1) the Texas Divestiture Assets will be operational and 
without material defect on the Texas Divestiture Date (2) there are no 
material defects in the environmental, zoning, or other permits 
pertaining to the operation of the Texas Divestiture Assets; and (3) 
Defendants have disclosed all encumbrances on any part of the Texas 
Divestiture Assets, including on intangible property. Following the 
sale of the Texas Divestiture Assets, Defendants must not undertake, 
directly or indirectly, challenges to the environmental, zoning, or 
other permits pertaining to the operation of the Texas Divestiture 
Assets.
    J. Defendants must assign, subcontract, or otherwise transfer all 
contracts, agreements, and relationships (or portions of such 
contracts, agreements, and relationships) included in the Texas 
Divestiture Assets, including but not limited to all supply and sales 
contracts, to the Acquirer of the Texas Divestiture Assets; provided, 
however, that for any contract or agreement that requires the consent 
of another party to assign, subcontract, or otherwise transfer, 
Defendants must use best efforts to accomplish the assignment, 
subcontracting, or transfer. Defendants must not interfere with any 
negotiations between the Acquirer of the Texas Divestiture Assets and a 
contracting party.
    K. Defendants must make best efforts to assist the Acquirer of the 
Texas Divestiture Assets to obtain all necessary licenses, 
registrations, and permits to operate the Texas Divestiture Assets. 
Until the Acquirer of the Texas Divestiture Assets obtains the 
necessary licenses, registrations, and permits, Defendants must provide 
the Acquirer of the Texas Divestiture Assets with the benefit of 
Defendants' licenses, registrations, and permits to the full extent 
permissible by law.
    L. At the option of the Acquirer of the Texas Divestiture Assets, 
and subject to approval by the United States in its sole discretion, on 
or before the Texas Divestiture Date, Defendants must enter into a 
contract to provide transition services for back office, human 
resources, accounting, employee health and safety, telephone and 
information technology services and support for a period of up to six 
(6) months on terms and conditions reasonably related to market 
conditions for the provision of the transition services. Any amendments 
to or modifications of any provisions of a contract for transition 
services are subject to approval by the United States, in its sole 
discretion. The United States, in its sole discretion, may approve one 
or more extensions of any contract for transition services, for a total 
of up to an additional six (6) months. If the Acquirer of the Texas 
Divestiture Assets seeks an extension of the term of any transition 
services agreement, Defendants must notify the United States in writing 
at least one (1) month prior to the date the contract expires. The 
Acquirer of the Texas Divestiture Assets may terminate a contract for 
transition services, or any portion of a contract for transition 
services, without cost or penalty at any time upon thirty (30) days' 
written notice to Republic. The employee(s) of Defendants tasked with 
providing transition services must not share any competitively 
sensitive information of the Acquirer of the Texas Divestiture Assets 
with any other employee of Defendants.
    M. If any term of an agreement between Defendants and the Acquirer 
of the Texas Divestiture Assets, including but not limited to an 
agreement to effectuate the divestiture required by this Final 
Judgment, varies from a term of this Final Judgment, to the extent that 
Defendants cannot fully comply with both, this Final Judgment 
determines Defendants' obligations.

VI. Appointment of Divestiture Trustee

    A. If Defendants have not divested the Divestiture Assets within 
the periods specified in Paragraph IV(A) and Paragraph V(A), Defendants 
must immediately notify Plaintiffs of that fact in writing. Upon 
application of the United States, which Defendants may not oppose, the 
Court will appoint a divestiture trustee selected by the

[[Page 18311]]

United States and approved by the Court to effect the divestiture(s) of 
any of the Divestiture Assets.
    B. After the appointment of a divestiture trustee by the Court, 
only the divestiture trustee will have the right to sell the 
Divestiture Assets that the divestiture trustee has been appointed to 
sell. The divestiture trustee will have the power and authority to 
accomplish the divestiture(s) to an Acquirer or Acquirers acceptable to 
the United States, in its sole discretion, after consultation with the 
State of Alabama, at a price and on terms as are then obtainable upon 
reasonable effort by the divestiture trustee, subject to the provisions 
of Sections IV, V, VI, and VII of this Final Judgment, and will have 
other powers as the Court deems appropriate. The divestiture trustee 
must sell the Divestiture Assets that the divestiture trustee has been 
appointed to sell as quickly as possible.
    C. Defendants may not object to a sale by the divestiture trustee 
on any ground other than malfeasance by the divestiture trustee. 
Objections by Defendants must be conveyed in writing to Plaintiffs and 
the divestiture trustee within ten (10) calendar days after the 
divestiture trustee has provided the notice of proposed divestiture 
required under Section VII.
    D. The divestiture trustee will serve at the cost and expense of 
Defendants pursuant to a written agreement, on terms and conditions, 
including confidentiality requirements and conflict-of-interest 
certifications, that are approved by the United States in its sole 
discretion.
    E. The divestiture trustee may hire at the cost and expense of 
Defendants any agents or consultants, including but not limited to 
investment bankers, attorneys, and accountants, that are reasonably 
necessary in the divestiture trustee's judgment to assist with the 
divestiture trustee's duties. These agents or consultants will be 
accountable solely to the divestiture trustee and will serve on terms 
and conditions, including terms and conditions governing 
confidentiality requirements and conflict-of-interest certifications, 
that are approved by the United States in its sole discretion.
    F. The compensation of the divestiture trustee and agents or 
consultants hired by the divestiture trustee must be reasonable in 
light of the value of the Divestiture Assets that the divestiture 
trustee has been appointed to sell and based on a fee arrangement that 
provides the divestiture trustee with incentives based on the price and 
terms of the divestiture(s) and the speed with which it is 
accomplished. If the divestiture trustee and Defendants are unable to 
reach agreement on the divestiture trustee's compensation or other 
terms and conditions of engagement within fourteen (14) calendar days 
of the appointment of the divestiture trustee by the Court, the United 
States may, in its sole discretion, take appropriate action, including 
by making a recommendation to the Court. Within three (3) business days 
of hiring an agent or consultant, the divestiture trustee must provide 
written notice of the hiring and rate of compensation to Defendants and 
the United States.
    G. The divestiture trustee must account for all monies derived from 
the sale of the assets sold by the divestiture trustee and all costs 
and expenses incurred. Within thirty (30) calendar days of the date of 
the sale of the assets sold by the divestiture trustee, the divestiture 
trustee must submit that accounting to the Court for approval. After 
approval by the Court of the divestiture trustee's accounting, 
including fees for unpaid services and those of agents or consultants 
hired by the divestiture trustee, all remaining money must be paid to 
Defendants and the trust will then be terminated.
    H. Defendants must use their best efforts to assist the divestiture 
trustee to accomplish the required divestiture. Subject to reasonable 
protection for trade secrets, other confidential research, development, 
or commercial information, or any applicable privileges, Defendants 
must provide the divestiture trustee and agents or consultants retained 
by the divestiture trustee with full and complete access to all 
personnel, books, records, and facilities of the Divestiture Assets 
that the divestiture trustee has been appointed to sell. Defendants 
also must provide or develop financial and other information relevant 
to the Divestiture Assets that the divestiture trustee may reasonably 
request. Defendants must not take any action to interfere with or to 
impede the divestiture trustee's accomplishment of the divestiture.
    I. The divestiture trustee must maintain complete records of all 
efforts made to sell the Divestiture Assets, including by filing 
monthly reports with Plaintiffs setting forth the divestiture trustee's 
efforts to accomplish the divestitures ordered by this Final Judgment. 
The reports must include the name, address, and telephone number of 
each person who, during the preceding month, made an offer to acquire, 
expressed an interest in acquiring, entered into negotiations to 
acquire, or was contacted or made an inquiry about acquiring any 
interest in the Divestiture Assets that the divestiture trustee has 
been appointed to sell and must describe in detail each contact with 
any such person.
    J. If the divestiture trustee has not accomplished the divestitures 
ordered by this Final Judgment within six months of appointment, the 
divestiture trustee must promptly provide Plaintiffs with a report 
setting forth: (1) The divestiture trustee's efforts to accomplish the 
required divestitures; (2) the reasons, in the divestiture trustee's 
judgment, why the required divestitures have not been accomplished; and 
(3) the divestiture trustee's recommendations for completing the 
divestitures. Following receipt of that report, the United States may 
make additional recommendations consistent with the purpose of the 
trust to the Court. The Court thereafter may enter such orders as it 
deems appropriate to carry out the purpose of this Final Judgment, 
which may include extending the trust and the term of the divestiture 
trustee's appointment by a period requested by the United States.
    K. The divestiture trustee will serve until divestiture of all 
Divestiture Assets that the divestiture trustee has been appointed to 
sell is completed or for a term otherwise ordered by the Court.
    L. If the United States determines that the divestiture trustee is 
not acting diligently or in a reasonably cost-effective manner, the 
United States may recommend that the Court appoint a substitute 
divestiture trustee.

VII. Notice of Proposed Divestiture

    A. Within two (2) business days following execution of a definitive 
divestiture agreement with an Acquirer other than Kinderhook (through 
its portfolio companies, CWS or EcoSouth) or Waste Connections (through 
its subsidiary Waste Connections of Texas), Defendants or the 
divestiture trustee, whichever is then responsible for effecting the 
divestiture, must notify Plaintiffs of a proposed divestiture required 
by this Final Judgment. If the divestiture trustee is responsible for 
completing the divestiture, the divestiture trustee also must notify 
Defendants. The notice must set forth the details of the proposed 
divestiture and list the name, address, and telephone number of each 
person not previously identified who offered or expressed an interest 
in or desire to acquire any ownership interest in the Divestiture 
Assets.
    B. Within fifteen (15) calendar days of receipt by the United 
States of this notice, the United States may request from Defendants, 
the proposed Acquirer(s), other third parties, or the divestiture 
trustee additional

[[Page 18312]]

information concerning the proposed divestiture, the proposed 
Acquirer(s) and other prospective Acquirers. Defendants and the 
divestiture trustee must furnish the additional information requested 
within fifteen (15) calendar days of the receipt of the request, unless 
the United States provides written agreement to a different period.
    C. Within forty-five (45) calendar days after receipt of the notice 
required by Paragraph VII(A) or within twenty (20) calendar days after 
the United States has been provided the additional information 
requested pursuant to Paragraph VII(B), whichever is later, the United 
States will provide written notice to Defendants and any divestiture 
trustee that states whether or not the United States, in its sole 
discretion, after consultation with State of Alabama, objects to the 
Acquirer(s) or any other aspect of the proposed divestiture. Without 
written notice that the United States does not object, a divestiture 
may not be consummated. If the United States provides written notice 
that it does not object, the divestiture may be consummated, subject 
only to Defendants' limited right to object to the sale under Paragraph 
VI(C) of this Final Judgment. Upon objection by Defendants pursuant to 
Paragraph VI(C), a divestiture by the divestiture trustee may not be 
consummated unless approved by the Court.
    D. No information or documents obtained pursuant to this Section 
VII may be divulged by Plaintiffs to any person other than an 
authorized representative of the executive branch of the United States 
or an authorized representative of the State of Alabama, except in the 
course of legal proceedings to which the United States is a party, 
including grand-jury proceedings, for the purpose of evaluating a 
proposed Acquirer or securing compliance with this Final Judgment, or 
as otherwise required by law.
    E. In the event of a request by a third party for disclosure of 
information under the Freedom of Information Act, 5 U.S.C. 552, the 
Antitrust Division will act in accordance with that statute and the 
Department of Justice regulations at 28 CFR part 16, including the 
provision on confidential commercial information at 28 CFR 16.7. 
Persons submitting information to the Antitrust Division should 
designate the confidential commercial information portions of all 
applicable documents and information under 28 CFR 16.7. Designations of 
confidentiality expire ten years after submission, ``unless the 
submitter requests and provides justification for a longer designation 
period.'' See 28 CFR 16.7(b).
    F. If at the time that a person furnishes information or documents 
to the United States or the State of Alabama pursuant to this Section 
VII, that person represents and identifies in writing information or 
documents for which a claim of protection may be asserted under Rule 
26(c)(1)(G) of the Federal Rules of Civil Procedure, and marks each 
pertinent page of such material, ``Subject to claim of protection under 
Rule 26(c)(1)(G) of the Federal Rules of Civil Procedure,'' the United 
States and the State of Alabama must give that person ten calendar 
days' notice before divulging the material in any legal proceeding 
(other than a grand-jury proceeding).

VIII. Financing

    Defendants may not finance all or any part of any Acquirer's 
purchase of all or part of the Divestiture Assets made pursuant to this 
Final Judgment.

IX. Asset Preservation

    Defendants must take all steps necessary to comply with the Asset 
Preservation Stipulation and Order entered by the Court. Defendants 
must take no action that would jeopardize the divestiture ordered by 
the Court.

X. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, and every thirty (30) calendar days thereafter until 
the divestiture required by this Final Judgment has been completed, 
each Defendant must deliver to Plaintiffs an affidavit describing the 
fact and manner of that Defendant's compliance with this Final 
Judgment. Republic's affidavits must be signed by the Senior Vice 
President of Emerging Business and a Deputy General Counsel; Santek's 
affidavits must be signed by the Chief Operating Officer and the Chief 
Business Officer. The United States, in its sole discretion, may 
approve different signatories for the affidavits.
    B. Each affidavit must include: (1) The name, address, and 
telephone number of each person who, during the preceding thirty (30) 
calendar days, made an offer to acquire, expressed an interest in 
acquiring, entered into negotiations to acquire, or was contacted or 
made an inquiry about acquiring, an interest in the Divestiture Assets 
and describe in detail each contact with such persons during that 
period; (2) a description of the efforts Defendants have taken to 
solicit buyers for and complete the sale of the Divestiture Assets, and 
to provide required information to prospective Acquirers; and (3) a 
description of any limitations placed by Defendants on information 
provided to prospective Acquirers. Objection by the United States to 
information provided by Defendants to prospective Acquirers must be 
made within fourteen (14) calendar days of receipt of the affidavit, 
except that the United States may object at any time if the information 
set forth in the affidavit is not true or complete.
    C. Defendants must keep all records of any efforts made to divest 
the Divestiture Assets until one year after the divestitures have been 
completed.
    D. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, each Defendant also must deliver to Plaintiffs an 
affidavit that describes in reasonable detail all actions that 
Defendant have taken and all steps that Defendant has implemented on an 
ongoing basis to comply with Section IX of this Final Judgment. 
Republic's affidavits must be signed by the Senior Vice President of 
Emerging Business and a Deputy General Counsel; Santek's affidavits 
must be signed by the Chief Operating Officer and the Chief Business 
Officer. The United States, in its sole discretion, may approve 
different signatories for the affidavits.
    E. If a Defendant make any changes to the efforts and actions 
outlined in any earlier affidavits provided pursuant to Paragraph X(D), 
the Defendant must, within fifteen (15) calendar days after any change 
is implemented, deliver to Plaintiffs an affidavit describing those 
changes.
    F. Defendants must keep all records of any efforts made to preserve 
the Divestiture Assets until one year after the divestiture has been 
completed.

XI. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of related orders such as the Asset Preservation 
Stipulation and Order or of determining whether this Final Judgment 
should be modified or vacated, upon written request of an authorized 
representative of the Assistant Attorney General for the Antitrust 
Division, and reasonable notice to Defendants, Defendants must permit, 
from time to time and subject to legally recognized privileges, 
authorized representatives, including agents retained by the United 
States:
    1. To have access during Defendants' office hours to inspect and 
copy, or at the option of the United States, to require Defendants to 
provide electronic copies of all books, ledgers, accounts, records, 
data, and documents in the possession, custody, or control of 
Defendants relating to any matters contained in this Final Judgment; 
and

[[Page 18313]]

    2. to interview, either informally or on the record, Defendants' 
officers, employees, or agents, who may have their individual counsel 
present, regarding such matters. The interviews must be subject to the 
reasonable convenience of the interviewee and without restraint or 
interference by Defendants.
    B. Upon the written request of an authorized representative of the 
Assistant Attorney General for the Antitrust Division, Defendants must 
submit written reports or respond to written interrogatories, under 
oath if requested, relating to any of the matters contained in this 
Final Judgment.
    C. No information or documents obtained by the United States 
pursuant to this Section XI may be divulged by Plaintiffs to any person 
other than an authorized representative of the executive branch of the 
United States or an authorized representative of the State of Alabama, 
except in the course of legal proceedings to which the United States is 
a party, including grand jury proceedings, for the purpose of securing 
compliance with this Final Judgment, or as otherwise required by law.
    D. In the event of a request by a third party for disclosure of 
information under the Freedom of Information Act, 5 U.S.C. 552, the 
Antitrust Division will act in accordance with that statute and the 
Department of Justice regulations at 28 CFR part 16, including the 
provision on confidential commercial information at 28 CFR 16.7. 
Defendants submitting information to the Antitrust Division should 
designate the confidential commercial information portions of all 
applicable documents and information under 28 CFR 16.7. Designations of 
confidentiality expire ten years after submission, ``unless the 
submitter requests and provides justification for a longer designation 
period.'' See 28 CFR 16.7(b).
    E. If at the time that Defendants furnish information or documents 
to the United States pursuant to this Section XI, Defendants represent 
and identify in writing information or documents for which a claim of 
protection may be asserted under Rule 26(c)(1)(G) of the Federal Rules 
of Civil Procedure, and Defendants mark each pertinent page of such 
material, ``Subject to claim of protection under Rule 26(c)(1)(G) of 
the Federal Rules of Civil Procedure,'' the United States must give 
Defendants ten (10) calendar days' notice before divulging the material 
in any legal proceeding (other than a grand jury proceeding).

XII. Notification

    A. Unless a transaction is otherwise subject to the reporting and 
waiting period requirements of the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, as amended, 15 U.S.C. 18a (the ``HSR Act''), 
Defendants may not, without first providing notification to the United 
States and, if any of the assets or interests are located in Alabama, 
to the State of Alabama, directly or indirectly acquire (including 
through an asset swap agreement) any assets of or any interest, 
including a financial, security, loan, equity, or management interest, 
in any person or entity involved in MSW Disposal and/or SCCW Collection 
services in any area identified in Appendix B, where that person's or 
entity's revenues for the 12 months preceding the proposed acquisition 
from MSW Disposal and/or SCCW Collection services in the identified 
area were in excess of $500,000. This provision also applies to an 
acquisition of facilities that serve an identified area but are located 
outside the area and requires notice to the State of Alabama where an 
identified area in Alabama is serviced by assets or interests to be 
acquired that are located outside of Alabama.
    B. Defendants must provide the notification required by this 
Section XII in the same format as, and in accordance with the 
instructions relating to, the Notification and Report Form set forth in 
the Appendix to Part 803 of Title 16 of the Code of Federal Regulations 
as amended, except that the information requested in Items 5 through 8 
of the instructions must be provided only about MSW Disposal and SCCW 
Collection. Notification must be provided at least thirty (30) calendar 
days before acquiring any assets or interest, and must include, beyond 
the information required by the instructions, the names of the 
principal representatives who negotiated the transaction on behalf of 
each party and all management or strategic plans discussing the 
proposed transaction. If, within the thirty (30) calendar days 
following notification, representatives of the United States make a 
written request for additional information, Defendants may not 
consummate the proposed transaction until thirty (30) calendar days 
after submitting all requested information.
    C. Early termination of the waiting periods set forth in this 
Section XII may be requested and, where appropriate, granted in the 
same manner as is applicable under the requirements and provisions of 
the HSR Act and rules promulgated thereunder. This Section XII must be 
broadly construed and any ambiguity or uncertainty regarding whether to 
file a notice under this Section XII must be resolved in favor of 
filing notice.

XIII. Limitations on Reacquisition

    Defendants may not reacquire any part of or any interest in the 
Divestiture Assets during the term of this Final Judgment.

XIV. Retention of Jurisdiction

    The Court retains jurisdiction to enable any party to this Final 
Judgment to apply to the Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to enforce 
compliance, and to punish violations of its provisions.

XV. Enforcement of Final Judgment

    A. The United States retains and reserves all rights to enforce the 
provisions of this Final Judgment or of related orders such as the 
Asset Preservation Stipulation and Order, including the right to seek 
an order of contempt from the Court. Defendants agree that in a civil 
contempt action, a motion to show cause, or a similar action brought by 
the United States regarding an alleged violation of this Final 
Judgment, the United States may establish a violation of this Final 
Judgment and the appropriateness of a remedy therefor by a 
preponderance of the evidence, and Defendants waive any argument that a 
different standard of proof should apply.
    B. This Final Judgment should be interpreted to give full effect to 
the procompetitive purposes of the antitrust laws and to restore the 
competition the United States and the State of Alabama allege was 
harmed by the challenged conduct. Defendants agree that they may be 
held in contempt of, and that the Court may enforce, any provision of 
this Final Judgment that, as interpreted by the Court in light of these 
procompetitive principles and applying ordinary tools of 
interpretation, is stated specifically and in reasonable detail, 
whether or not it is clear and unambiguous on its face. In any such 
interpretation, the terms of this Final Judgment should not be 
construed against either party as the drafter.
    C. In an enforcement proceeding in which the Court finds that 
Defendants have violated this Final Judgment, the United States may 
apply to the Court for a one-time extension of this Final Judgment, 
together with other relief that may be appropriate. In connection with 
a successful effort by the United States

[[Page 18314]]

to enforce this Final Judgment against a Defendant, whether litigated 
or resolved before litigation, that Defendant agrees to reimburse the 
United States for the fees and expenses of its attorneys, as well as 
all other costs including experts' fees, incurred in connection with 
that effort to enforce the Final Judgment, including in the 
investigation of the potential violation.
    D. For a period of four (4) years following the expiration of this 
Final Judgment, if the United States has evidence that a Defendant 
violated this Final Judgment before it expired, the United States may 
file an action against that Defendant in this Court requesting that the 
Court order: (1) Defendant to comply with the terms of this Final 
Judgment for an additional term of at least four years following the 
filing of the enforcement action; (2) all appropriate contempt 
remedies; (3) additional relief needed to ensure the Defendant complies 
with the terms of this Final Judgment; and (4) fees or expenses as 
called for by this Section XV.

XVI. Expiration of Final Judgment

    Unless the Court grants an extension, this Final Judgment will 
expire ten (10) years from the date of its entry, except that after 
five (5) years from the date of its entry, this Final Judgment may be 
terminated upon notice by the United States, after consultation with 
the State of Alabama, to the Court and Defendants that the divestiture 
has been completed and the continuation of this Final Judgment is no 
longer necessary or in the public interest.

XVII. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16, including by making available to the 
public copies of this Final Judgment and the Competitive Impact 
Statement, public comments thereon, and any response to comments by the 
United States. Based upon the record before the Court, which includes 
the Competitive Impact Statement and, if applicable, any comments and 
response to comments filed with the Court, entry of this Final Judgment 
is in the public interest.

Date:------------------------------------------------------------------
[Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16]
-----------------------------------------------------------------------
United States District Judge

Appendix A: Southeast Divestiture Assets

I. Landfills and Transfer Stations (Paragraph II(K)(1))

    a. Rhea County Landfill, located at 207 Sanitary Drive, Dayton, 
Tennessee 37321;
    b. Murray County Landfill and Transfer Station, located at 6585 
US-411, Chatsworth, Georgia 30734; and
    c. Chattanooga Transfer Station, located at 1387 Wisdom Street, 
Chattanooga, Tennessee 37406.

II. Collection Facilities and Routes (Paragraph II(K)(3))

    a. Collection facilities located at:
    i. 140 Goodrich Drive, Birmingham, Alabama 35217;
    ii. 1387 Wisdom Street, Chattanooga, Tennessee 37406;
    iii. 2207 Industrial South Road, Dalton, Georgia 30721;
    iv. 108 Nehi Road, Ellisville, Mississippi 39437;
    b. Routes:
    i. Santek Birmingham SCCW Collection Routes 901, 902, 903 and 
904;
    ii. Santek Chattanooga SCCW Collection Routes 901, 902, 903, 
904, 906, and 907;
    iii. Santek Chattanooga Commercial Recycling Collection Route 
201;
    iv. Santek North Georgia SCCW Collection Routes 902, 904, 905, 
909, 919, 920, 922, and 923; and
    v. Santek Hattiesburg SCCW Collection Routes 901, 902, 903, 904 
and 905.

Appendix B: Areas for Which the Notice Provision in Paragraph XII(A) 
Applies

------------------------------------------------------------------------
                                    Counties within
        Geographic market          geographic market   Relevant service
------------------------------------------------------------------------
Birmingham, Alabama.............  Jefferson and       SCCW Collection.
                                   Shelby Counties.
Chattanooga, Tennessee and North  Hamilton, Marion,   MSW Disposal and
 Georgia.                          Rhea, and           SCCW Collection.
                                   Sequatchie
                                   Counties in
                                   Tennessee; and
                                   Catoosa,
                                   Chattooga, Dade,
                                   Gordon, Murray,
                                   and Walker
                                   Counties in
                                   Georgia.
Eastern Montgomery County, Texas  Montgomery County   SCCW Collection.
                                   (limited to zip
                                   codes 77357,
                                   77365, and 77372).
Estill Springs and Fayetteville,  Franklin and        MSW Disposal.
 Tennessee.                        Lincoln Counties.
Hattiesburg, Mississippi........  Forrest and Jones   SCCW Collection.
                                   Counties.
------------------------------------------------------------------------

United States District Court for the District of Columbia

    United States of America and State of Alabama, Plaintiffs, v. 
Republic Services, Inc. and Santek Waste Services, LLC Defendants.

Civil Action No.: 1:21-cv-00883-RDM
Judge: Randolph D. Moss

Competitive Impact Statement

    In accordance with the Antitrust Procedures and Penalties Act, 15 
U.S.C. 16 (the ``APPA'' or ``Tunney Act''), the United States of 
America files this Competitive Impact Statement related to the proposed 
Final Judgment filed in this civil antitrust proceeding.

I. Nature and Purpose of the Proceeding

    On February, 18, 2020, Republic Services, Inc. (``Republic'') 
agreed to acquire Santek Waste Services, LLC (``Santek''). The United 
States and the State of Alabama filed a civil antitrust Complaint on 
March 31, 2021, seeking to enjoin the proposed acquisition. The 
Complaint alleges that the likely effect of this acquisition would be 
to substantially lessen competition for small container commercial 
waste (``SCCW'') collection and municipal solid waste (``MSW'') 
disposal in six geographic markets in the southeastern United States in 
violation of Section 7 of the Clayton Act, 15 U.S.C. 18.
    At the same time the Complaint was filed, the United States filed a 
proposed Final Judgment and an Asset Preservation Stipulation and Order 
(``Stipulation and Order''), which are designed to remedy the loss of 
competition alleged in the Complaint.
    Under the proposed Final Judgment, which is explained more fully 
below, Defendants are required to divest specified SCCW collection and 
MSW disposal assets in six local markets in five states. The assets to 
be divested are grouped into two packages--the Southeast Divestiture 
Assets and the Texas Divestiture Assets (capitalized terms are defined 
in the proposed Final Judgment). The Southeast Divestiture Assets 
includes assets in Alabama,

[[Page 18315]]

Georgia, Mississippi, and Tennessee. The Texas Divestiture Assets 
includes assets in Texas.
    Under the terms of the Stipulation and Order, Defendants must take 
certain steps to ensure that the assets that must be divested are 
operated as ongoing, economically viable, competitive assets for the 
provision of SCCW collection and MSW disposal and must take all other 
actions to preserve and maintain the full economic viability, 
marketability, and competitiveness of the assets to be divested.
    The Plaintiffs and Defendants have stipulated that the proposed 
Final Judgment may be entered after compliance with the APPA. Entry of 
the proposed Final Judgment will terminate this action, except that the 
Court will retain jurisdiction to construe, modify, or enforce the 
provisions of the proposed Final Judgment and to punish violations 
thereof.

II. Description of Events Giving Rise to the Alleged Violation

A. The Defendants and the Proposed Transaction

    Pursuant to a purchase agreement dated February 18, 2020, and 
amended on May 19, 2020, July 10, 2020, October 6, 2020, and March 8, 
2021, Republic proposes to acquire all of the outstanding membership 
interest in Santek.
    Republic, a Delaware corporation headquartered in Phoenix, Arizona, 
is the second largest non-hazardous solid waste collection and disposal 
company in the United States. It provides waste collection, recycling, 
and disposal (including transfer) services. Republic operates in 41 
states and Puerto Rico. For 2020 Republic reported revenues of 
approximately $10.2 billion.
    Santek, a Tennessee limited liability company headquartered in 
Cleveland, Tennessee, is a vertically integrated solid waste management 
company with waste collection and disposal (including transfer) 
operations in nine southeastern states. In 2019, the most recent year 
for which information is publicly available, Santek generated 
approximately $140 million in revenue.

B. Relevant Product Markets

57. Small Container Commercial Waste Collection
    As alleged in the Complaint, SCCW (small container commercial waste 
collection) is a relevant product market. Waste collection firms--also 
called haulers--collect MSW (municipal solid waste) from residential, 
commercial, and industrial establishments, and transport that waste to 
a disposal site, such as a transfer station, landfill, or incinerator, 
for processing and disposal.
    SCCW collection is the business of collecting MSW from commercial 
and industrial accounts, usually in small containers (i.e., dumpsters 
with one to ten cubic yards capacity), and transporting such waste to a 
disposal site. Typical SCCW collection customers include office and 
apartment buildings and retail establishments like stores and 
restaurants.
    SCCW collection is distinct from other types of waste collection 
such as residential and roll-off collection. An individual commercial 
customer typically generates substantially more MSW than a residential 
customer. To handle this high volume of MSW efficiently, SCCW haulers 
often provide commercial customers with small containers for storing 
the waste. SCCW haulers organize their commercial accounts into routes 
and collect and transport the MSW generated by these accounts in front-
end load (``FEL'') trucks that are uniquely well suited for commercial 
waste collection.
    On a typical SCCW collection route, an operator drives a FEL truck 
to the customer's container, engages a mechanism that grasps and lifts 
the container over the front of the truck, and empties the container 
into the vehicle's storage section where the waste is compacted and 
stored. The operator continues along the route, collecting MSW from 
each of the commercial accounts, until the vehicle is full. The 
operator then drives the FEL truck to a disposal facility, such as a 
transfer station, landfill, or incinerator, and empties the contents of 
the vehicle. Depending on the number of locations and amount of waste 
collected on the route, the operator may make one or more trips to the 
disposal facility in servicing the route.
    In contrast to a SCCW collection route, a residential waste 
collection route is highly labor intensive. A residential customer's 
MSW is typically stored in much smaller containers such as trash cans, 
and instead of using a FEL truck manned by a single operator, 
residential haulers routinely use rear-end load or side-load trucks 
typically manned by two- or three-person teams who may need to hand-
load the customer's MSW. In light of these differences, haulers 
typically organize commercial customers into separate routes from 
residential customers.
    Roll-off container collection also is not a substitute for SCCW 
collection. Roll-off container collection is commonly used to serve 
construction and demolition customers. A roll-off container is much 
larger than a SCCW container and is serviced by a truck capable of 
carrying a single roll-off container. Unlike SCCW customers, multiple 
roll-off customers are not served between trips to the disposal site, 
as each roll-off truck is typically only capable of carrying one roll-
off container at a time.
    Other types of waste collection, such as hazardous or medical waste 
collection, also are not substitutes for SCCW collection. These forms 
of collection differ from SCCW collection in the equipment required, 
the volume of waste collected, and the facilities where the waste is 
disposed.
    The Complaint alleges that, because no other waste collection 
service can substitute for SCCW collection, other waste collection 
services do not constrain pricing for SCCW collection. Absent 
competition, SCCW collection providers could profitably increase their 
prices without losing significant sales to firms engaged in the 
provision of other types of waste collection services. In other words, 
in the event of a small but significant non-transitory increase in 
price for SCCW collection, customers would not substitute to other 
forms of collection in sufficient numbers so as to render the price 
increase unprofitable. SCCW collection is therefore a line of commerce, 
or relevant product market, for purposes of analyzing the effects of 
the acquisition under Section 7 of the Clayton Act.
58. Municipal Solid Waste Disposal
    As alleged in the Complaint, MSW disposal is a relevant product 
market. MSW is solid putrescible waste generated by households and 
commercial establishments such as retail stores, offices, restaurants, 
warehouses, and industrial facilities. MSW has physical characteristics 
that readily distinguish it from other liquid or solid waste, such as 
waste from manufacturing processes, regulated medical waste, sewage, 
sludge, hazardous waste, or waste generated by construction or 
demolition sites.
    Haulers must dispose of all MSW at a permitted disposal facility. 
There are intermediary disposal facilities--transfer stations--and 
ultimate disposal facilities--landfills and incinerators. All such 
facilities must be located on approved types of land and operated under 
prescribed procedures. Federal, state, and local safety, environmental, 
zoning, and permit laws and regulations dictate critical aspects of 
storage, handling, transportation, processing, and disposal of MSW. In 
less densely populated areas, MSW often is disposed of directly into 
landfills that are permitted and regulated by a state and

[[Page 18316]]

the federal government. Landfill permit restrictions often impose 
limitations on the type and amount of waste that can be deposited. In 
many urban and suburban areas, landfills are scarce due to high 
population density and the limited availability of suitable land. As a 
result, MSW generated in such areas often is burned in an incinerator 
or taken to a transfer station. Transfer stations briefly hold MSW 
until it is reloaded from collection vehicles onto larger tractor-
trailers for transport, in bulk, to more distant landfills or 
incinerators for final disposal.
    Some haulers--including Republic and Santek--are vertically 
integrated and operate their own disposal facilities. Vertically 
integrated haulers often prefer to dispose of waste at their own 
disposal facilities. Vertically integrated haulers may also sell a 
portion of their disposal capacity to disposal customers in need of 
access to a disposal facility.
    Disposal customers include private waste haulers without their own 
disposal assets (referred to in the industry as ``independent 
haulers'') as well as local governments that own their own equipment 
and collect their citizens' waste themselves. Disposal customers also 
include independent and municipally-owned transfer stations that serve 
as temporary disposal sites for haulers in areas where landfills and 
incinerators are not easily accessible. Disposal customers that are not 
vertically integrated lack their own ultimate disposal facilities and 
rely on cost-competitive landfills.
    As alleged in the Complaint, due to strict laws and regulations 
that govern the disposal of MSW, there are no reasonable substitutes 
for MSW disposal, which must occur at landfills, incinerators, or 
transfer stations. Thus, in the event of a small but significant non-
transitory increase in price from MSW disposal firms, customers would 
not substitute to other forms of disposal in sufficient numbers so as 
to render the price increase unprofitable. MSW disposal is therefore a 
line of commerce, or relevant product market, for purposes of analyzing 
the effects of the acquisition under Section 7 of the Clayton Act.

C. Relevant Geographic Markets

1. Small Container Commercial Waste Collection Geographic Markets
    As alleged in the Complaint, the relevant geographic markets for 
SCCW collection are local. This is because SCCW haulers need a large 
number of closely located customer pick-up locations to operate 
efficiently and profitably. If there is significant travel time between 
customers, then the SCCW hauler earns less money for the time that the 
truck operates. SCCW haulers, therefore, try to minimize the ``dead 
time'' in which the truck is operating and incurring costs from fuel, 
wear and tear, and labor, but not generating revenue from collecting 
waste. Likewise, customers must be near the SCCW hauler's base of 
operations as it would be unprofitable for a truck to travel a long 
distance to the start of a route. SCCW haulers, therefore, generally 
establish garages and related facilities to serve as bases within each 
area served.
    As alleged in the Complaint, the transaction would likely cause 
harm in four relevant geographic markets for SCCW collection: (1) The 
Birmingham, Alabama area (Jefferson and Shelby Counties); (2) the 
Chattanooga, Tennessee and North Georgia area (Hamilton, Marion, Rhea, 
and Sequatchie Counties in Tennessee; and Catoosa, Chattooga, Dade, 
Gordon, Murray, and Walker Counties in Georgia); (3) the Eastern 
Montgomery County, Texas area (the area east of the City of Conroe 
defined as zip codes 77357, 77365, and 77372); and (4) the Hattiesburg, 
Mississippi area (Forrest and Jones Counties). In each of these 
markets, a hypothetical monopolist of SCCW collection could profitably 
impose a small but significant non-transitory increase in price for 
SCCW collection without losing significant sales to more distant 
competitors. Accordingly, each of these areas constitutes a relevant 
geographic market and section of the country for purposes of analyzing 
the effects of the acquisition on SCCW collection under Section 7 of 
the Clayton Act.
2. Municipal Solid Waste Disposal Geographic Markets
    As alleged in the Complaint, the relevant geographic markets for 
MSW disposal are local as the cost of transporting MSW to a disposal 
site--including fuel, regular truck maintenance, and hourly labor--is a 
substantial component of the total cost of MSW disposal. Haulers also 
prefer nearby MSW disposal sites to minimize the FEL truck dead time. 
Due to the costs associated with travel time and customers' preference 
to have MSW disposal sites close by, an MSW disposal provider must have 
local facilities to be competitive.
    As alleged in the Complaint, the proposed transaction would likely 
cause harm in two relevant geographic markets for MSW disposal: (1) The 
Chattanooga, Tennessee area (Hamilton County); and (2) the Estill 
Springs and Fayetteville, Tennessee area (Franklin and Lincoln 
Counties). In each of these local markets, a hypothetical monopolist of 
MSW disposal could profitably impose a small but significant non-
transitory increase in price for MSW disposal without losing 
significant sales to more distant MSW disposal sites.
    Accordingly, the Complaint alleges that the Chattanooga, Tennessee 
area, and the Estill Springs and Fayetteville, Tennessee area 
constitute relevant geographic markets for the purposes of analyzing 
the effects of the acquisition on MSW disposal under Section 7 of the 
Clayton Act.

D. Anticompetitive Effects of the Proposed Transaction

    As alleged in the Complaint, the proposed transaction would 
increase concentration, significantly and substantially lessen 
competition, and harm consumers in each relevant market by eliminating 
the substantial head-to-head competition that currently exists between 
Republic and Santek.
    Market concentration can be a useful indicator of the level of 
competitive vigor in a market and likely competitive effects of a 
merger. The more concentrated a market, and the more a transaction 
would increase concentration in a market, the more likely it is that 
the transaction would result in harm to consumers by meaningfully 
reducing competition.
    Concentration in relevant markets is typically defined by the 
Herfindahl-Hirschman Index (``HHI''). Markets in which the HHI is above 
2,500 are considered to be highly concentrated. Mergers that increase 
the HHI by more than 200 points and result in a highly concentrated 
market are presumed to likely enhance market power. See U.S. Dep't of 
Justice & Fed. Trade Comm'n, Horizontal Merger Guidelines Sec.  5.3 
(revised Aug. 19, 2010) (``Horizontal Merger Guidelines''), https://www.justice.gov/atr/horizontal-merger-guidelines-08192010.
    As alleged in the Complaint, Republic's acquisition of Santek would 
result in a highly concentrated market in every relevant SCCW 
collection market and relevant MSW disposal market. Moreover, as a 
result of the acquisition, the HHI would increase by more than 400 
points in each of these markets, suggesting an increased likelihood of 
significant anticompetitive effects. Therefore, Republic's proposed 
acquisition of Santek is presumptively likely to enhance Republic's 
market power. See Horizontal Merger Guidelines Sec.  5.3.

[[Page 18317]]

    As alleged in the Complaint, the merger would also substantially 
lessen competition through the vertical integration of the two 
companies. Specifically, by combining Republic's strong position in 
both SCCW collection and MSW disposal with Santek's strong position in 
both SCCW collection and MSW disposal, the proposed transaction would 
increase Republic's incentive and ability to harm its SCCW collection 
rivals by raising the costs of MSW disposal in the Chattanooga, 
Tennessee and North Georgia area. With SCCW collection rivals facing 
higher operational costs, they would have to raise their SCCW 
collection prices to offset these costs and would be less able to apply 
competitive pressure on Republic's SCCW collection operations. As a 
result, businesses, municipalities, and other customers likely would 
pay higher prices for SCCW collection. See U.S. Dep't of Justice & Fed. 
Trade Comm'n, Vertical Merger Guidelines Sec.  4(a) (June 30, 2020), 
https://www.justice.gov/atr/page/file/1290686/download.
1. Elimination of Horizontal Competition in SCCW Collection
    As alleged in the Complaint, Republic's acquisition of Santek would 
eliminate a significant competitor for SCCW collection in markets that 
are already highly concentrated and difficult to enter. Republic and 
Santek compete head-to-head for SCCW collection customers in the 
relevant SCCW collection markets. In these four geographic markets, 
Republic and Santek each account for a substantial share of total 
revenue generated from SCCW collection and, in each relevant market, 
are two of no more than five significant competitors.
    In each relevant SCCW collection market, collection customers 
including offices, apartment buildings, and retail establishments have 
been able to secure better collection rates and improved collection 
service by threatening to switch from Republic to Santek or vice versa. 
In each of the relevant markets, the elimination of this head-to-head 
competition would allow Republic to exercise market power unilaterally 
to increase prices and reduce the quality of service for SCCW 
collection customers.
i. Birmingham, Alabama Area SCCW Collection
    As alleged in the Complaint, in the Birmingham, Alabama area, the 
proposed acquisition would reduce from five to four the number of 
significant competitors in the SCCW collection market. After the 
acquisition, Defendants would have approximately 61 percent of the SCCW 
collection customers in the market. The post-merger HHI for SCCW 
collection in this market would be approximately 4,157, an increase of 
445 points from the current HHI.
ii. Chattanooga, Tennessee and North Georgia Area SCCW Collection
    As alleged in the Complaint, in the Chattanooga, Tennessee and 
North Georgia area, the proposed acquisition would reduce from five to 
four the number of significant competitors in the SCCW collection 
market. After the acquisition, Defendants would have approximately 73 
percent of the SCCW collection customers in the market. The post-merger 
HHI for SCCW collection in this market would be approximately 5,551, an 
increase of 2,660 points from the current HHI.
iii. Eastern Montgomery County, Texas Area SCCW Collection
    As alleged in the Complaint, in the Eastern Montgomery County, 
Texas area, the proposed acquisition would reduce from three to two the 
number of significant competitors in the SCCW collection market. After 
the acquisition, Defendants would have approximately 58 percent of the 
SCCW collection customers in the market. The post-merger HHI for SCCW 
collection in this market would be approximately 4,064, an increase of 
1,703 points from the current HHI.
iv. Hattiesburg, Mississippi Area SCCW Collection
    As alleged in the Complaint, in the Hattiesburg, Mississippi area, 
the proposed acquisition would reduce from five to four the number of 
significant competitors in the SCCW collection market. After the 
acquisition, Defendants would have approximately 55 percent of SCCW 
collection customers in the market. The post-merger HHI for SCCW 
collection would be approximately 3,853, an increase of 1,420 points 
from the current HHI.
2. Elimination of Horizontal Competition in MSW Disposal
    As alleged in the Complaint, Republic's acquisition of Santek would 
also eliminate a significant competitor for MSW disposal in markets 
that are already highly concentrated and difficult to enter. Republic 
and Santek compete head-to-head for MSW disposal customers in the 
relevant MSW disposal markets. In these geographic markets, Republic 
and Santek each account for a substantial share of total revenue 
generated from MSW disposal and, in each relevant MSW disposal market, 
are two of no more than three significant competitors. In each relevant 
MSW disposal market, independent haulers and municipalities have been 
able to negotiate more favorable MSW disposal rates by threatening to 
move MSW from Republic's facilities to Santek's facilities and vice 
versa. In each of the relevant MSW disposal markets, the elimination of 
this head-to-head competition would allow Republic to exercise market 
power unilaterally to increase prices and reduce the quality of service 
for MSW disposal customers.
i. Chattanooga, Tennessee Area MSW Disposal
    As alleged in the Complaint, in the Chattanooga, Tennessee area, 
the proposed acquisition would reduce from three to two the number of 
significant competitors in the MSW disposal market. After the 
acquisition, approximately 82 percent of the waste generated in the 
Chattanooga, Tennessee area would either be disposed of directly in the 
Defendants' landfills or pass through the Defendants' transfer stations 
in Chattanooga before ultimately being disposed of in the Defendants' 
landfills. The post-merger HHI for MSW disposal would be approximately 
6,980, an increase of 3,018 points from the current HHI.
ii. Estill Springs and Fayetteville, Tennessee Area MSW Disposal
    MSW in the Estill Springs and Fayetteville, Tennessee area, is 
hauled to municipally-owned transfer stations before it is transferred 
to a landfill. As alleged in the Complaint, the proposed acquisition 
would reduce from three to two the number of significant landfill 
competitors available to bid to dispose of the MSW from these transfer 
stations. Since Santek was awarded the most recent contracts for the 
exclusive right to dispose of the waste from the Estill Springs and 
Fayetteville, Tennessee area's municipally-owned transfer stations, the 
transaction will not have an impact on the market's HHI. Still, the 
loss of competition between Republic and Santek for the area's 
contracts will result in higher prices and lower quality service for 
these municipalities in the upcoming years when the current contracts 
expire.
3. Raising Rivals' Costs of MSW Disposal in the Chattanooga, Tennessee 
and North Georgia Area
    As alleged in the Complaint, in the Chattanooga, Tennessee and 
North Georgia area, the proposed transaction also would substantially 
lessen competition in the SCCW collection market by raising the MSW 
disposal

[[Page 18318]]

costs of independent haulers. As noted above, Republic and Santek 
collectively serve approximately 73 percent of the SCCW collection 
customers in the Chattanooga, Tennessee and North Georgia area. In 
addition, the vast majority of the waste generated in this area is 
disposed of in landfills operated by Republic and Santek. Thus, not 
only are Defendants each other's largest competitor in the SCCW 
collection market, they also compete with each other to supply MSW 
disposal services to independent haulers, including those that compete 
with them in the SCCW collection market.
    By combining the two firms' SCCW collection and MSW disposal 
businesses, the merger would increase Republic's incentive and ability 
to raise its MSW disposal price for independent haulers. Having 
acquired its largest MSW disposal competitor, Santek, Republic would be 
able to raise its MSW disposal prices without fear of losing 
significant sales to remaining disposal competitors. With few 
alternative MSW disposal facilities available, independent haulers 
would be forced to incur these increased MSW disposal costs or shutter 
their operations. Those independent haulers that remained in business 
would need to raise their SCCW collection prices in order to offset 
higher MSW disposal costs, rendering them less competitive in SCCW 
collection. The merger would also increase Republic's incentive to 
raise the MSW disposal costs of independent haulers because Republic--
no longer confronting competition from Santek in SCCW collection--would 
capture more of the business lost by independent haulers in the SCCW 
collection market.
    As alleged in the Complaint, as a result, the merged firm would 
likely find it profitable to raise the cost of MSW disposal or to deny 
service altogether to the merged firm's SCCW collection rivals, thereby 
reducing competition in the SCCW collection market.

E. Difficulty of Entry

1. Difficulty of Entry Into SCCW Collection
    As alleged in the Complaint, entry of new competitors into the 
relevant SCCW collection markets would be difficult and time-consuming 
and is unlikely to prevent the harm to competition that is likely to 
result if the proposed transaction is consummated.
    A new entrant in SCCW collection could not provide a significant 
competitive constraint on the prices that market incumbents charge 
until achieving a minimum efficient scale and operating efficiency 
comparable to existing competitors. In order to obtain a comparable 
operating efficiency, a new competitor would have to achieve route 
densities similar to those of firms already in the market. Incumbents 
in a geographic market, however, can prevent new entrants from winning 
a large enough base of customers by selectively lowering prices and 
entering into longer term contracts with collection customers.
2. Difficulty of Entry Into MSW Disposal
    As alleged in the Complaint, entry of new competitors into the 
relevant MSW disposal markets would be difficult and time-consuming and 
is unlikely to prevent the harm to competition that is likely to result 
if the proposed transaction is consummated.
    A new entrant in MSW disposal would need to obtain a permit to 
construct an MSW disposal facility or to expand an existing one, and 
this process is costly and time-consuming, typically taking many years. 
Land suitable for MSW disposal is scarce, as a landfill must be 
constructed away from environmentally-sensitive areas, including fault 
zones, wetlands, flood plains, and other restricted areas. Even when 
suitable land is available, local public opposition frequently 
increases the time and uncertainty of the permitting process.
    Construction of a new transfer station or incinerator also is 
difficult and time consuming and faces many of the same challenges as 
new landfill construction, including local public opposition.
    Thus, entry by constructing and permitting a new MSW disposal 
facility would be costly, time-consuming, and unlikely to prevent 
market incumbents from significantly raising prices for MSW disposal in 
each of the relevant MSW disposal markets following the acquisition.

III. Explanation of the Proposed Final Judgment

    The relief required by the proposed Final Judgment will remedy the 
loss of competition alleged in the Complaint by maintaining competition 
in each of the SCCW collection and MSW disposal markets alleged in the 
Complaint. The assets to be divested are grouped into two packages--the 
Southeast Divestiture Assets and the Texas Divestiture Assets 
(capitalized terms are defined in the proposed Final Judgment).
    The Southeast Divestiture Assets include all of the assets 
necessary for the Acquirer of the Southeast Divestiture Assets to 
operate an economically viable business that will remedy the harm that 
the United States and the State of Alabama allege would otherwise 
result from the transaction in (1) the SCCW collection markets in the 
Birmingham, Alabama area; the Chattanooga, Tennessee and North Georgia 
area; and the Hattiesburg, Mississippi area and (2) the MSW disposal 
markets in the Chattanooga, Tennessee area and the Estill Springs and 
Fayetteville, Tennessee area.\1\
---------------------------------------------------------------------------

    \1\ The landfill and transfer station assets to be divested in 
Tennessee and Georgia, as defined in Paragraphs II(K)(1) and (2) of 
the proposed Final Judgment, address not only the potential 
elimination of horizontal competition in MSW disposal as alleged in 
Paragraphs 41-43 of the Complaint, but along with the SCCW 
collection assets to be divested in Tennessee and Georgia, as 
defined in Paragraphs II(K)(3) and (4) of the proposed Final 
Judgment, they address the potential for Defendants to raise rivals' 
costs of MSW disposal as alleged in Paragraphs 44-47 of the 
Complaint.
---------------------------------------------------------------------------

    The Texas Divestiture Assets include all of the assets necessary 
for the Acquirer of the Texas Divestiture Assets to operate an 
economically viable business that will remedy the harm that the United 
States and the State of Alabama allege would otherwise result from the 
transaction in the SCCW collection market in the Eastern Montgomery 
County, Texas area.

A. Southeast Divestiture Assets

    Paragraph IV(A) of the proposed Final Judgment requires Defendants, 
within 30 days after the entry of the Stipulation and Order by the 
Court, to divest the Southeast Divestiture Assets to Kinderhook 
Industries LLC (through its portfolio companies Capital Waste Services, 
LLC, EcoSouth Services of Birmingham, LLC, and EcoSouth Services of 
Mobile, LLC), or an alternative acquirer acceptable to the United 
States, in its sole discretion, after consultation with the State of 
Alabama. The assets must be divested in such a way as to satisfy the 
United States in its sole discretion, after consultation with the State 
of Alabama, that the Southeast Divestiture Assets can and will be used 
by the Acquirer as part of a viable, ongoing SCCW collection business 
and a viable, ongoing MSW disposal business that can compete 
effectively in each of the markets in Alabama, Georgia, Mississippi, 
and Tennessee alleged in the Complaint. Defendants must take all 
reasonable steps necessary to accomplish the divestiture of the 
Southeast Divestiture Assets quickly and must cooperate with the 
Acquirer.
    The Southeast Divestiture Assets are defined as all tangible and 
intangible assets relating to or used in connection with the MSW 
disposal assets identified in Paragraphs II(K)(1) and II(K)(2) of the

[[Page 18319]]

proposed Final Judgment and the SCCW collection assets identified in 
Paragraphs II(K)(3) and II(K)(4) of the proposed Final Judgment. The 
Southeast Divestiture Assets include two landfills, two transfer 
stations, four collection facilities, and 24 Routes in Alabama, 
Georgia, Mississippi, and Tennessee. The Southeast Divestiture Assets 
also include, in each MSW disposal market alleged: All tangible and 
intangible property and assets related to or used in connection with 
the transfer stations and landfills except for the Excluded Disposal 
Agreements, which are explained below. In each SCCW collection market 
alleged, the Southeast Divestiture Assets include: All intangible and 
tangible assets related to or used in connection with the Routes except 
for what the proposed Final Judgment defines as Hybrid Contracts, which 
are explained below, and a collection facility located at 101 Barber 
Boulevard, Gardendale, Alabama 35071. In the Chattanooga, Tennessee and 
North Georgia market, the Southeast Divestiture Assets include not only 
SCCW collection assets, but also commercial recycling collection assets 
which should enhance the viability of the Southeast Divestiture Assets.
    Paragraph IV(K) of the proposed Final Judgment facilitates the 
transfer of customers and other contractual relationships, except for 
Hybrid Contracts and the Excluded Disposal Agreements, to the Acquirer 
of the Southeast Divestiture Assets. Defendants must transfer all 
contracts, agreements, and relationships to the Acquirer of the 
Southeast Divestiture Assets and must make best efforts to assign, 
subcontract, or otherwise transfer contracts or agreements that require 
the consent of another party before assignment, subcontracting, or 
other transfer.
    Hybrid Contracts, which are defined in Paragraph II(S) as customer 
waste or recycling contracts that include a combination of services 
and/or collection stops included in the Southeast Divestiture Assets 
and services and/or collection stops not included in the Southeast 
Divestiture Assets, and that make up a small portion of the SCCW 
collection contracts included in the divestiture package, are required 
under Paragraph IV(L) to be divested at the option of the Acquirer of 
the Southeast Divestiture Assets. This will enable the Acquirer of the 
Southeast Divestiture Assets to have the option to acquire the customer 
contracts which it determines it can efficiently and profitably serve.
    The Excluded Disposal Agreements are not required to be divested 
because they are not necessary for the Acquirer of the Southeast 
Divestiture Assets to operate the Southeast Divestiture Assets as part 
of a viable, ongoing MSW disposal business that can compete effectively 
in the Chattanooga, Tennessee area and the Fayetteville and Estill 
Springs, Tennessee area. The Excluded Disposal Agreements are defined 
in Paragraph II(R) as (1) the Landfill Disposal Services Agreement, 
dated December 1, 2012, between Putnam County, Tennessee and Santek 
Environmental, Inc., as amended by First Amendment to Landfill Disposal 
Services Agreement, dated October 16, 2020, and (2) the Waste Disposal 
Agreement, dated November 16, 2018, between Santek Environmental, LLC 
and Clean Harbors Environmental Services, Inc., as amended by First 
Amendment to Waste Disposal Agreement, dated January 26, 2021. They are 
not related to MSW disposal services provided in any market alleged in 
the Complaint, and, therefore, are excluded from the assets to be 
divested.
    The collection facility located at 101 Barber Boulevard, 
Gardendale, Alabama 35071 is not part of the Southeast Divestiture 
Assets because the Acquirer of the Southeast Divestiture Assets will 
acquire a collection facility located 140 Goodrich Drive, Birmingham, 
Alabama 35217 from which it can competitively run the acquired Routes 
in the Birmingham, Alabama area.
    The proposed Final Judgment contains several provisions to 
facilitate the transition of the Southeast Divestiture Assets to the 
Acquirer of the Southeast Divestiture Assets. First, Paragraph IV(P) of 
the proposed Final Judgement requires Defendants, at the option of the 
Acquirer of the Southeast Divestiture Assets, to enter into an 
agreement to provide a maintenance bay, outdoor parking for six trucks 
and empty container storage, and an interior office at Republic's 
collection facility in Birmingham, Alabama. This provision is intended 
to give the Acquirer of the Southeast Divestiture Assets a location 
from which it can temporarily run the acquired Routes in the 
Birmingham, Alabama area while it sets up its own maintenance bay and 
interior offices at the collection facility it is acquiring.
    Second, Paragraph IV(N) of the proposed Final Judgment requires 
Defendants to provide certain transition services to maintain the 
viability and competitiveness of the Southeast Divestiture Assets 
during the transition to the Acquirer of the Southeast Divestiture 
Assets. Paragraph IV(N) of the proposed Final Judgment requires 
Defendants, at the option of the Acquirer of the Southeast Divestiture 
Assets, to enter into a transition services agreement for back office, 
human resources, accounting, employee health and safety, telephone, and 
information technology services and support for the Southeast 
Divestiture Assets for a period of up to three months. The Acquirer of 
the Southeast Divestiture Assets may terminate the transition services 
agreement, or any portion of it, without cost or penalty at any time 
upon 30 days' written notice to Republic. The paragraph further 
provides that the United States, in its sole discretion, may approve 
one or more extensions of this transition services agreement for a 
total of up to an additional three months and that any amendments to or 
modifications of any provisions of a transition services agreement are 
subject to approval by the United States in its sole discretion. 
Paragraph IV(N) also provides that employees of Defendants tasked with 
supporting this agreement must not share any competitively sensitive 
information of the Acquirer of the Southeast Divestiture Assets with 
any other employee of Defendants.
    Third, Paragraph IV(O) of the proposed Final Judgment requires 
Defendants, at the option of the Acquirer of the Southeast Divestiture 
Assets, to enter into a contract to provide rights to landfill disposal 
at Republic's Pineview Landfill and Santek's Mt. Olive Landfill for a 
period of up to three years. The proposed Final Judgment also requires 
Defendants to operate gates, side houses, and disposal areas for the 
benefit of the Acquirer of the Southeast Divestiture Assets under terms 
and conditions that are no less favorable than those provided to 
Defendants' own vehicles. The Acquirer of the Southeast Divestiture 
Assets may terminate the landfill disposal contract without cost or 
penalty at any time upon 30 days' written notice to Republic. This 
provision is intended to give the Acquirer of the Southeast Divestiture 
Assets an immediate and efficient outlet for the waste that it will 
collect on the Routes in the Birmingham, Alabama area. This will allow 
the Acquirer of the Southeast Divestiture Assets to operate cost 
competitively as soon as it acquires the Routes rather than face a 
delay in needing to negotiate with disposal facilities in the region.
    The proposed Final Judgment also contains provisions intended to 
facilitate efforts by the Acquirer of the Southeast Divestiture Assets 
to hire certain employees. Specifically, Paragraph IV(I) of the 
proposed Final Judgment requires Defendants to provide the Acquirer of 
the Southeast Divestiture Assets, the United States,

[[Page 18320]]

and the State of Alabama with organization charts and information 
relating to these employees and to make them available for interviews. 
It also provides that Defendants must not interfere with any 
negotiations by the Acquirer of the Southeast Divestiture Assets to 
hire these employees. In addition, for employees who elect employment 
with the Acquirer of the Southeast Divestiture Assets, Defendants must 
waive all non-compete and non-disclosure agreements, vest all unvested 
pension and other equity rights, provide any pay pro-rata, provide all 
other compensation and benefits that those employees have fully or 
partially accrued, and provide all other benefits that those employees 
otherwise would have been provided had those employees continued 
employment with Defendants, including but not limited to any retention 
bonuses or payments. This paragraph further provides that the 
Defendants may not solicit to hire any employees who elect employment 
with the Acquirer of the Southeast Divestiture Assets, unless that 
individual is terminated or laid off by the Acquirer of the Southeast 
Divestiture Assets or the Acquirer of the Southeast Divestiture Assets 
agrees in writing that the Defendants may solicit or hire that 
individual. The non-solicitation period runs for 12 months from the 
date of the divestiture. This paragraph does not prohibit Defendants 
from advertising employment openings using general solicitations or 
advertisements and rehiring employees who apply for a position through 
a general solicitation or advertisement.

B. Texas Divestiture Assets

    Paragraph V(A) of the proposed Final Judgment requires Defendants, 
within 30 days after the entry of the Stipulation and Order by the 
Court, to divest the Texas Divestiture Assets to Waste Connections, 
Inc. (through its subsidiary Waste Connections of Texas, LLC), or an 
alternative acquirer acceptable to the United States. The Texas 
Divestiture Assets must be divested in such a way as to satisfy the 
United States in its sole discretion that the Texas Divestiture Assets 
can and will be used by the Acquirer as part of a viable, ongoing SCCW 
collection business that can compete effectively in Eastern Montgomery 
County, Texas. Defendants must take all reasonable steps necessary to 
accomplish the divestiture quickly and must cooperate with the 
Acquirer.
    The Texas Divestiture Assets are defined as all tangible and 
intangible assets relating to or used in connection with the SCCW 
collection assets identified in Paragraphs II(L)(1) and II(L)(2) of the 
proposed Final Judgment. The Texas Divestiture Assets include two 
Routes and all intangible and tangible assets related to or used in 
connection with the Routes except for the collection facility located 
at 701 US Hwy 59 South, Cleveland Texas, 77327. The collection facility 
located at 701 US Hwy 59 South, Cleveland Texas, 77327 is not part of 
the Texas Divestiture Assets because, as with Waste Connections, any 
acquirer should already operate a collection facility in the Eastern 
Montgomery, County area into which it can efficiently integrate the two 
Routes and from which it can compete.
    Paragraph V(J) of the proposed Final Judgment facilitates the 
transfer of customers and other contractual relationships to the 
Acquirer of the Texas Divestiture Assets. Defendants must transfer all 
contracts, agreements, and relationships to the Acquirer and must make 
best efforts to assign, subcontract, or otherwise transfer contracts or 
agreements that require the consent of another party before assignment, 
subcontracting or other transfer.
    Paragraph IV(N) of the proposed Final Judgment requires Defendants 
to provide certain transition services to maintain the viability and 
competitiveness of the Texas Divestiture Assets during the transition 
to the Acquirer of the Texas Divestiture Assets. Paragraph V(L) of the 
proposed Final Judgment requires Defendants, at the Acquirer of the 
Texas Divestiture Assets' option, to enter into a transition services 
agreement for back office, human resources, accounting, employee health 
and safety, telephone, and information technology services and support 
for the Texas Divestiture Assets for a period of up to six months. The 
Acquirer of the Texas Divestiture Assets may terminate the transition 
services agreement, or any portion of it, without cost or penalty at 
any time upon 30 days' written notice to Republic. The paragraph 
further provides that the United States, in its sole discretion, may 
approve one or more extensions of this transition services agreement 
for a total of up to an additional six months and that any amendments 
to or modifications of any provisions of a transition services 
agreement are subject to approval by the United States in its sole 
discretion. Paragraph IV(N) also provides that employees of Defendants 
tasked with supporting this agreement must not share any competitively 
sensitive information of the Acquirer of the Texas Divestiture Assets 
with any other employee of Defendants.
    The proposed Final Judgment also contains provisions intended to 
facilitate the Acquirer of the Southeast Divestiture Assets' efforts to 
hire certain employees. Paragraph V(H) of the proposed Final Judgment 
requires Defendants to provide the Acquirer of the Texas Divestiture 
Assets and the United States with organization charts and information 
relating to these employees and to make them available for interviews. 
It also provides that Defendants must not interfere with any 
negotiations by the Acquirer of the Texas Divestiture Assets to hire 
these employees. In addition, for employees who elect employment with 
the Acquirer of the Texas Divestiture Assets, Defendants must waive all 
non-compete and non-disclosure agreements, vest all unvested pension 
and other equity rights, provide any pay pro-rata, provide all other 
compensation and benefits that those employees have fully or partially 
accrued, and provide all other benefits that those employees otherwise 
would have been provided had those employees continued employment with 
Defendants, including but not limited to any retention bonuses or 
payments. This paragraph further provides that the Defendants may not 
solicit to hire any employees who elect employment with the Acquirer of 
the Texas Divestiture Assets, unless that individual is terminated or 
laid off by the Acquirer of the Texas Divestiture Assets or the 
Acquirer of the Texas Divestiture Assets agrees in writing that the 
Defendants may solicit or hire that individual. The non-solicitation 
period runs for 12 months from the date of the divestiture. This 
paragraph does not prohibit Defendants from advertising employment 
openings using general solicitations or advertisements and rehiring 
employees who apply for a position through a general solicitation or 
advertisement.

C. Divestiture Trustee

    If Defendants do not accomplish the divestiture(s) within the 
periods prescribed in Sections IV and V of the proposed Final Judgment, 
Section VI of the proposed Final Judgment provides that the Court will 
appoint a divestiture trustee selected by the United States to effect 
the divestiture. If a divestiture trustee is appointed, the proposed 
Final Judgment provides that Defendants must pay all costs and expenses 
of the trustee. The divestiture trustee's commission must be structured 
so as to provide an incentive for the trustee based on the price and 
terms of the divestiture(s) and the speed with which the divestiture is 
accomplished. After the divestiture trustee's appointment

[[Page 18321]]

becomes effective, the trustee must provide monthly reports to the 
Plaintiffs setting forth his or her efforts to accomplish the 
divestiture. If the divestiture has not been accomplished within six 
months of the divestiture trustee's appointment, the United States may 
make recommendations to the Court, which will enter such orders as 
appropriate, in order to carry out the purpose of the Final Judgment, 
including by extending the trust or the term of the divestiture 
trustee's appointment.

D. Other Provisions

    Section XII of the proposed Final Judgment requires Defendants to 
notify the United States and, if any of the assets or interests are 
located in Alabama, to the State of Alabama, in advance of acquiring, 
directly or indirectly (including through an asset swap agreement), in 
a transaction that would not otherwise be reportable under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. 
18a (the ``HSR Act''), any assets of or interest in any business 
engaged in SCCW collection or MSW disposal in a market where the 
Complaint alleged a violation, which are listed in Appendix A. Pursuant 
to the proposed Final Judgment, Defendants must notify the United 
States of such acquisitions as it would for a required HSR Act filing, 
as specified in the Appendix to Part 803 of Title 16 of the Code of 
Federal Regulations. The proposed Final Judgment further provides for 
waiting periods and opportunities for the United States to obtain 
additional information analogous to the provisions of the HSR Act 
before such acquisitions can be consummated. The notification 
requirement applies when the acquired business's annual revenues from 
the relevant service in the market exceeded $500,000 for the 12 months 
preceding the proposed acquisition. It is important for the United 
States and the State of Alabama to receive notice of even small 
transactions that have the potential to reduce competition in these 
markets because the markets alleged in the Complaint are highly 
concentrated. Requiring notification of any such acquisition will 
permit the United States and the State of Alabama, as relevant, to 
assess the competitive effects of that acquisition before it is 
consummated and, if necessary, seek to enjoin the transaction.
    The proposed Final Judgment also contains provisions designed to 
promote compliance with and make enforcement of the Final Judgment as 
effective as possible. Paragraph XV(A) provides that the United States 
retains and reserves all rights to enforce the Final Judgment, 
including the right to seek an order of contempt from the Court. Under 
the terms of this paragraph, Defendants have agreed that in any civil 
contempt action, any motion to show cause, or any similar action 
brought by the United States regarding an alleged violation of the 
Final Judgment, the United States may establish the violation and the 
appropriateness of any remedy by a preponderance of the evidence and 
that Defendants have waived any argument that a different standard of 
proof should apply. This provision aligns the standard for compliance 
with the Final Judgment with the standard of proof that applies to the 
underlying offense that the Final Judgment addresses.
    Paragraph XV(B) provides additional clarification regarding the 
interpretation of the provisions of the proposed Final Judgment. The 
proposed Final Judgment is intended to remedy the loss of competition 
the United States alleges would otherwise be harmed by the transaction. 
Defendants agree that they will abide by the proposed Final Judgment 
and that they may be held in contempt of the Court for failing to 
comply with any provision of the proposed Final Judgment that is stated 
specifically and in reasonable detail, as interpreted in light of this 
procompetitive purpose.
    Paragraph XV(C) provides that if the Court finds in an enforcement 
proceeding that a Defendant has violated the Final Judgment, the United 
States may apply to the Court for a one-time extension of the Final 
Judgment, together with such other relief as may be appropriate. In 
addition, to compensate American taxpayers for any costs associated 
with investigating and enforcing violations of the Final Judgment, 
Paragraph XV(C) provides that, in any successful effort by the United 
States to enforce the Final Judgment against a Defendant, whether 
litigated or resolved before litigation, the Defendant must reimburse 
the United States for attorneys' fees, experts' fees, and other costs 
incurred in connection with any effort to enforce the Final Judgment, 
including the investigation of the potential violation.
    Paragraph XV(D) states that the United States may file an action 
against a Defendant for violating the Final Judgment for up to four 
years after the Final Judgment has expired or been terminated. This 
provision is meant to address circumstances such as when evidence that 
a violation of the Final Judgment occurred during the term of the Final 
Judgment is not discovered until after the Final Judgment has expired 
or been terminated or when there is not sufficient time for the United 
States to complete an investigation of an alleged violation until after 
the Final Judgment has expired or been terminated. This provision, 
therefore, makes clear that, for four years after the Final Judgment 
has expired or been terminated, the United States may still challenge a 
violation that occurred during the term of the Final Judgment.
    Finally, Section XVI of the proposed Final Judgment provides that 
the Final Judgment will expire ten years from the date of its entry, 
except that after five years from the date of its entry, the Final 
Judgment may be terminated upon notice by the United States to the 
Court and Defendants that the divestiture has been completed and that 
continuation of the Final Judgment is no longer necessary or in the 
public interest.

IV. Remedies Available to Potential Private Plaintiffs

    Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the proposed Final Judgment neither impairs 
nor assists the bringing of any private antitrust damage action. Under 
the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the 
proposed Final Judgment has no prima facie effect in any subsequent 
private lawsuit that may be brought against Defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

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

[[Page 18322]]

received during this period will be considered by the U.S. Department 
of Justice, which remains free to withdraw its consent to the proposed 
Final Judgment at any time before the Court's entry of the Final 
Judgment. The comments and the response of the United States will be 
filed with the Court. In addition, the comments and the United States' 
responses will be published in the Federal Register unless the Court 
agrees that the United States instead may publish them on the U.S. 
Department of Justice, Antitrust Division's internet website.
    Written comments should be submitted in English to: Katrina Rouse, 
Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, 
U.S. Department of Justice, 450 Fifth Street NW, Suite 8700, 
Washington, DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    As an alternative to the proposed Final Judgment, the United States 
considered a full trial on the merits against Defendants. The United 
States could have continued the litigation and sought preliminary and 
permanent injunctions against Republic's acquisition of Santek. The 
United States is satisfied, however, that the relief required by the 
proposed Final Judgment will remedy the anticompetitive effects alleged 
in the Complaint, preserving competition for the provision of SCCW 
collection and MSW disposal in each of the geographic markets alleged 
in the Complaint. Thus, the proposed Final Judgment achieves all or 
substantially all of the relief the United States would have obtained 
through litigation but avoids the time, expense, and uncertainty of a 
full trial on the merits.

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

    Under the Clayton Act and APPA, proposed Final Judgments or 
``consent decrees'' in antitrust cases brought by the United States are 
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 
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); United States v. U.S. Airways Grp., 
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 a court's review of a 
proposed Final Judgment is limited and only inquires ``into whether the 
government's determination that the proposed remedies will cure the 
antitrust violations alleged in the complaint was reasonable, and 
whether the mechanism to enforce the final judgment are clear and 
manageable'').
    As the U.S. 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 proposed Final Judgment is 
sufficiently clear, whether its enforcement mechanisms are sufficient, 
and whether it may positively harm third parties. See Microsoft, 56 
F.3d at 1458-62. With respect to the adequacy of the relief secured by 
the proposed Final Judgment, a court may not ``make de novo 
determination of facts and issues.'' United States v. W. Elec. Co., 993 
F.2d 1572, 1577 (D.C. Cir. 1993) (quotation marks omitted); see also 
Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F. 
Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F. 
Supp. 2d 10, 16 (D.D.C. 2000); 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.'' W. 
Elec. Co., 993 F.2d at 1577 (quotation marks omitted). ``The court 
should bear in mind the flexibility of the public interest inquiry: the 
court's function is not to determine whether the resulting array of 
rights and liabilities is one that will best serve society, but only to 
confirm that the resulting settlement is within the reaches of the 
public interest.'' Microsoft, 56 F.3d at 1460 (quotation marks 
omitted); see also United States v. Deutsche Telekom AG, No. 19-2232 
(TJK), 2020 WL 1873555, at *7 (D.D.C. Apr. 14, 2020). More demanding 
requirements would ``have enormous practical consequences for the 
government's ability to negotiate future settlements,'' contrary to 
congressional intent. Id. at 1456. ``The Tunney Act was not intended to 
create a disincentive to the use of the consent decree.'' Id.
    The United States' predictions about the efficacy of the remedy are 
to be afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at 
1461 (recognizing courts should give ``due respect to the Justice 
Department's . . . view of the nature of its case''); United States v. 
Iron Mountain, Inc., 217 F. Supp. 3d 146, 152-53 (D.D.C. 2016) (``In 
evaluating objections to settlement agreements under the Tunney Act, a 
court must be mindful that [t]he government need not prove that the 
settlements will perfectly remedy the alleged antitrust harms[;] it 
need only provide a factual basis for concluding that the settlements 
are reasonably adequate remedies for the alleged harms.'') (internal 
citations omitted); United States v. Republic Servs., Inc., 723 F. 
Supp. 2d 157, 160 (D.D.C. 2010) (noting ``the deferential review to 
which the government's proposed remedy is accorded''); United States v. 
Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (``A 
district court must accord due respect to the government's prediction 
as to the effect of proposed remedies, its perception of the market 
structure, and its view of the nature of the case.''). The ultimate 
question is whether ``the remedies [obtained by the Final Judgment 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 W. Elec. Co., 900 F.2d at 309).
    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

[[Page 18323]]

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 (``[T]he 
`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.
    In its 2004 amendments to the APPA, Congress made clear its intent 
to preserve the practical benefits of using judgments proposed by the 
United States in antitrust enforcement, Public Law 108-237 Sec.  221, 
and added 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) (statement of Sen. 
Tunney). ``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 (citing Enova Corp., 107 F. 
Supp. 2d at 17).

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.

Dated: April 2, 2021

Respectfully submitted,

For Plaintiff United States of America:

-----------------------------------------------------------------------
Gabriella R. Moskowitz, (D.C. Bar #1044309),
Defense, Industrials, and Aerospace Section, Antitrust Division, 
U.S. Department of Justice, 450 Fifth Street NW, Suite 8700, 
Washington, DC 20530, Telephone: (202) 598-8885, 
[email protected]

Appendix A: Areas for Which the Notice Provision in Paragraph XII(A) of 
the Proposed Final Judgment Applies

------------------------------------------------------------------------
                                    Counties within
        Geographic market          geographic market   Relevant service
------------------------------------------------------------------------
Birmingham, Alabama.............  Jefferson and       SCCW Collection.
                                   Shelby Counties.
Chattanooga, Tennessee and North  Hamilton, Marion,   MSW Disposal and
 Georgia.                          Rhea, and           SCCW Collection.
                                   Sequatchie
                                   Counties in
                                   Tennessee; and
                                   Catoosa,
                                   Chattooga, Dade,
                                   Gordon, Murray,
                                   and Walker
                                   Counties in
                                   Georgia.
Eastern Montgomery County, Texas  Montgomery County   SCCW Collection.
                                   (limited to zip
                                   codes 77357,
                                   77365, and 77372).
Estill Springs and Fayetteville,  Franklin and        MSW Disposal.
 Tennessee.                        Lincoln Counties.
Hattiesburg, Mississippi........  Forrest and Jones   SCCW Collection.
                                   Counties.
------------------------------------------------------------------------

[FR Doc. 2021-07224 Filed 4-7-21; 8:45 am]
BILLING CODE 4410-11-P