80_FR_30829 80 FR 30726 - United States v. Verso Paper Corp. and NewPage Holdings Inc.; Public Comments and Response on Proposed Final Judgment

80 FR 30726 - United States v. Verso Paper Corp. and NewPage Holdings Inc.; Public Comments and Response on Proposed Final Judgment

DEPARTMENT OF JUSTICE
Antitrust Division

Federal Register Volume 80, Issue 103 (May 29, 2015)

Page Range30726-30736
FR Document2015-13025

Federal Register, Volume 80 Issue 103 (Friday, May 29, 2015) 
[Federal Register Volume 80, Number 103 (Friday, May 29, 2015)]
[Notices]
[Pages 30726-30736]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-13025]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Verso Paper Corp. and NewPage Holdings Inc.; 
Public Comments and Response on Proposed Final Judgment

    Pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. 
16(b)-(h), the United States hereby publishes below the comments 
received on the proposed Final Judgment in United States v. Verso Paper 
Corp., et al., Civil Action No. 1:14-CV-2216-TSC (D.D.C. 2014), 
together with the Response of the United States to Public Comments.
    Copies of the comments, attachments to these comments, and the 
United States' Response are available for inspection at the Department 
of Justice Antitrust Division, 450 Fifth Street NW., Suite 1010, 
Washington, DC 20530 (telephone: 202-514-2481), on the Department of 
Justice's Web site at http://www.justice.gov/atr/cases/verso.html, and 
at the Office of the Clerk of the United States District Court for the 
District of Columbia, 333 Constitution Avenue NW., Washington, DC 
20001. Copies of any of these materials may also be obtained upon 
request and payment of a copying fee.

 Patricia A. Brink,
Director of Civil Enforcement.

United States District Court for the District of Columbia

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

Case No. 1:14-cv-2216 (TSC)

Response of Plaintiff United States to Public Comments on the Proposed 
Final Judgment

    Pursuant to the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec.  16(b)-(h) (``APPA'' or ``Tunney Act''), 
the United States hereby responds to the public comments received 
regarding the proposed Final Judgment in this case. After careful 
consideration of the submitted comments, the United States continues to 
believe that the proposed Final Judgment will provide an effective and 
appropriate remedy for the antitrust violations alleged in the 
Complaint. The United States will move the Court for entry of the 
proposed Final Judgment after the public comments and this response 
have been published in the Federal Register pursuant to 15 U.S.C. Sec.  
16(d).\1\
---------------------------------------------------------------------------

    \1\ On May 7, 2015, the United States submitted its Unopposed 
Motion and Supporting Memorandum to Excuse Federal Register 
Publication of Attachments to Public Comments requesting that this 
Court authorize an alternative means for publishing the attachments 
to the public comments received in this action. (Docket No. 11.)

---------------------------------------------------------------------------

[[Page 30727]]

I. Procedural History

    On January 3, 2014, Verso Paper Corp. (``Verso'') entered into an 
agreement to acquire NewPage Holdings Inc. (``NewPage'') in a 
transaction valued at approximately $1.4 billion.\2\ The United States 
filed a civil antitrust Complaint on December 31, 2014, seeking to 
enjoin Verso from acquiring NewPage. The United States alleged in its 
Complaint that the acquisition likely would substantially lessen 
competition in the sale of coated freesheet web paper, coated 
groundwood paper, and label papers to customers in North America in 
violation of Section 7 of the Clayton Act, 15 U.S.C. Sec.  18. At the 
time the Complaint was filed, Verso and NewPage were vigorous 
competitors in these coated paper markets.
---------------------------------------------------------------------------

    \2\ After the United States initiated this action on December 
31, 2014, Verso Paper Corp. changed its name to Verso Corporation.
---------------------------------------------------------------------------

    Simultaneously with the filing of the Complaint, the United States 
filed a proposed Final Judgment and a Stipulation signed by Plaintiff 
and Defendants consenting to entry of the proposed Final Judgment after 
compliance with the requirements of the Tunney Act, 15 U.S.C. Sec.  16, 
and a Competitive Impact Statement (``CIS'') describing the transaction 
and the proposed Final Judgment. The United States published the 
proposed Final Judgment and CIS in the Federal Register on January 14, 
2015, see 80 FR 1957, and caused summaries of the proposed Final 
Judgment and CIS, together with directions for the submission of 
written comments relating to the proposed Final Judgment, to be 
published in The Washington Post on January 14, 15, 16, 19, 20, 21, and 
22, 2015. The 60[hyphen]day period for public comment ended on March 
24, 2015. The United States received two comments, as described below 
and attached hereto as Exhibits 1 and 2.

II. The Investigation and the Proposed Resolution

    The proposed Final Judgment is the culmination of a nearly year-
long investigation by the Antitrust Division of the United States 
Department of Justice (``Department'') of the proposed transaction. As 
part of its investigation, the Department issued 19 Civil Investigative 
Demands for documents and information to third parties, collected 
almost one million documents from the Defendants and third parties, 
interviewed more than 100 customers, brokers, and competitors in the 
relevant coated paper markets, deposed 12 Verso and NewPage employees, 
and consulted with industry experts. The Department carefully analyzed 
the information it obtained from these sources and thoroughly 
considered all of the issues presented.
    The Department found that the proposed acquisition would likely 
have eliminated substantial head-to-head competition in the relevant 
markets between Verso and NewPage, providing the combined firm with an 
incentive to raise prices and reduce output. The Department also found 
in the coated freesheet web paper and coated groundwood paper markets 
that the transaction would have likely caused the remaining players to 
accommodate one another's price increases and output reductions. 
Overall, the Department concluded that if Verso and NewPage had 
completed the proposed transaction as structured, the loss of 
competition likely would have resulted in higher prices to consumers. 
For these reasons, the Department filed a civil antitrust lawsuit to 
block the merger and alleged that the proposed transaction violated 
Section 7 of the Clayton Act, 15 U.S.C. Sec.  18.
    The proposed Final Judgment eliminates the anticompetitive effects 
identified in the Complaint by requiring Defendants to divest NewPage's 
Rumford, Maine and Biron, Wisconsin paper mills and related assets 
(collectively, ``the Divestiture Assets'') to Catalyst Paper 
Corporation (``Catalyst'') on terms acceptable to the United States. 
The divestitures eliminate the anticompetitive effects of the 
transaction by transferring the Rumford and Biron paper mills to a 
vigorous and independent competitor and preserving the pre-merger 
market structure in the coated freesheet web paper, coated groundwood 
paper, and label paper markets.
    Since the United States submitted the proposed Final Judgment on 
December 31, 2014, Verso has acquired NewPage, and Catalyst has 
acquired and is operating the Divestiture Assets.

III. Standard of Judicial Review

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

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

15 U.S.C. Sec.  16(e)(1). In considering these statutory factors, the 
court's inquiry is necessarily a limited one as the government is 
entitled to ``broad discretion to settle with the defendant within the 
reaches of the public interest.'' United States v. Microsoft Corp., 56 
F.3d 1448, 1461 (D.C. Cir. 1995); see also United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1, 10-11 (D.D.C. 2007) (assessing 
public interest standard under the Tunney Act); United States v. InBev 
N.V./S.A., No. 08-cv-1965 (JR), 2009 U.S. Dist. LEXIS 84787, at *3 
(D.D.C. Aug. 11, 2009) (discussing nature of review of consent judgment 
under the Tunney Act; inquiry is limited to ``whether the government's 
determination that the proposed remedies will cure the antitrust 
violations alleged in the complaint was reasonable, and whether the 
mechanisms to enforce the final judgment are clear and manageable'').
    Under the APPA, a court considers, among other things, the 
relationship between the remedy secured and the specific allegations 
set forth in the Complaint, whether the decree is sufficiently clear, 
whether the enforcement mechanisms are sufficient, and whether the 
decree may positively harm third parties. See Microsoft, 56 F.3d at 
1458-62. With respect to the adequacy of the relief secured by the 
decree, a court may not ``engage in an unrestricted evaluation of what 
relief would best serve the public.'' United States v. BNS, Inc., 858 
F.2d 456, 462 (9th Cir. 1988) (citing United States v. Bechtel Corp., 
648 F.2d 660, 666 (9th Cir. 1981)). Instead, courts have held that:

[t]he balancing of competing social and political interests affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is

[[Page 30728]]

the one that will best serve society, but whether the settlement in 
``within the reaches of the public interest.'' More elaborate 
requirements might undermine the effectiveness of antitrust 
enforcement by consent decree.

Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).
    In determining whether a proposed settlement is in the public 
interest, ``the court `must accord deference to the government's 
predictions about the efficacy of its remedies.''' United States v. 
U.S. Airways Grp., Inc., 38 F. Supp. 3d 69, 76 (D.D.C. 2014) (quoting 
SBC Commc'ns, 489 F. Supp. at 17). See also Microsoft, 56 F.3d at 1461 
(noting that the government is entitled to deference as to its 
``predictions as to the effect of the proposed remedies''); United 
States v. Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 
2003) (noting that the court should grant due respect to the United 
States' ``prediction as to the effect of the proposed remedies, its 
perception of the market structure, and its views of the nature of the 
case''); United States v. Morgan Stanley, 881 F. Supp. 2d 563, 567-68 
(S.D.N.Y. 2012) (explaining that the government is entitled to 
deference in choice of remedies).
    Courts ``may not require that the remedies perfectly match the 
alleged violations.'' SBC Commc'ns, 489 F. Supp. 2d at 17. Rather, the 
ultimate question is whether ``the remedies [obtained in the decree 
are] so inconsonant with the allegations charged as to fall outside of 
the `reaches of the public interest.' '' Microsoft, 56 F.3d at 1461. 
Accordingly, the United States ``need only provide a factual basis for 
concluding that the settlements are reasonably adequate remedies for 
the alleged harms.'' SBC Commc'ns, 489 F. Supp. 2d at 17. And, a 
``proposed decree must be approved even if it falls short of the remedy 
the court would impose on its own, as long as it falls within the range 
of acceptability or is within the reaches of the public interest.'' 
United States v. Am. Tel. & Tel. Co., 552 F. Supp. 131, 151 (D.D.C. 
1982) (citations and internal quotations omitted); see also United 
States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 1985) 
(approving the consent decree even though the court would have imposed 
a greater remedy).
    In its 2004 amendments to the Tunney Act,\3\ Congress made clear 
its intent to preserve the practical benefits of using consent decrees 
in antitrust enforcement, adding the unambiguous instruction that 
``[n]othing in this section shall be construed to require the court to 
conduct an evidentiary hearing or to require the court to permit anyone 
to intervene.'' 15 U.S.C. Sec.  16(e)(2). The procedure for the public 
interest determination is left to the discretion of the court, with the 
recognition that the court's ``scope of review remains sharply 
proscribed by precedent and the nature of the Tunney Act proceedings.'' 
SBC Commc'ns, 489 F. Supp. 2d at 11; see also United States v. Enova 
Corp., 107 F. Supp. 2d 10, 17 (D.D.C. 2000) (``[T]he Tunney Act 
expressly allows the court to make its public interest determination on 
the basis of the competitive impact statement and response to public 
comments alone.'').
---------------------------------------------------------------------------

    \3\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for courts to consider and amended the 
list of factors to focus on competitive considerations and to 
address potentially ambiguous judgment terms. Compare 15 U.S.C. 
Sec.  16(e) (2004), with 15 U.S.C. Sec.  16(e)(1) (2006); see also 
SBC Commc'ns, 489 F. Supp. 2d at 11 (concluding that the 2004 
amendments ``effected minimal changes'' to Tunney Act review).
---------------------------------------------------------------------------

IV. Summary of Public Comments and the United States' Response

A. Summary of the Public Comments

    During the 60-day comment period, the United States received two 
comments regarding the proposed Final Judgment, although no comments 
were received from any printer, publisher, or other paper customer. The 
only comments were made by former employees of the now closed 
Bucksport, Maine paper mill. Verso produced coated groundwood and 
specialty paper products at the Bucksport mill until closing the mill 
in December 2014 and selling it to AIM Development (USA) LLC (``AIM''). 
AIM is the U.S. subsidiary of American Iron & Metal, Inc., a company 
that purchases discontinued manufacturing facilities and salvages the 
metal. Both comments focus upon competition in the coated groundwood 
paper market and the closure of the Bucksport mill.
    Local 1821 of the International Association of Machinists and 
Aerospace Workers (``Local 1821''), consisting of 58 former employees 
of the Bucksport mill, submitted a comment arguing that: (1) The 
divestitures provided by the proposed Final Judgment are inadequate to 
redress the merger's anticompetitive effects and should have included 
the Bucksport mill; (2) Catalyst is an insufficiently independent and 
vigorous competitor and should not have been selected as the buyer of 
the Divestiture Assets; (3) recent price increases by Verso and 
Catalyst demonstrate the failure of the proposed Final Judgment to 
remedy the transaction's anticompetitive effects; and (4) the United 
States should have investigated alleged anticompetitive conduct that 
Verso's parent company, Apollo Capital Management (``Apollo''), has 
engaged in since at least 2011, including efforts to buy NewPage, 
acquiring NewPage's debt to influence its business operations, and 
causing Verso and NewPage to shut down mills in order to reduce output 
and raise prices. Local 1821 further argues that the Department should 
open an investigation into whether the sale of the Bucksport mill to 
AIM violated Section 1 of the Sherman Act.
    Herbert R. Gilley also submitted a comment. Mr. Gilley, who is not 
a member of Local 1821, worked at the Bucksport mill for more than 38 
years before losing his job when the mill closed. In his comment, Mr. 
Gilley similarly contests the closure and sale of the Bucksport mill 
and argues that the closure was anticompetive and will result in 
reduced output and higher prices.

B. The United States' Response to the Public Comments

1. The Divestiture Assets Are Sufficient To Remedy the Harm Alleged in 
the Complaint
    Local 1821 and Mr. Gilley argue that the required divestitures are 
not sufficient to prevent the merger's anticompetitive effects and 
assert that additional paper mills, including Verso's Bucksport mill, 
should have been included in the divestiture package. But the required 
divestitures essentially preserve the preexisting competitive structure 
of the affected coated paper markets by providing Catalyst with 
approximately the same capacity as Verso had prior to the merger. The 
divested Rumford and Biron mills produced approximately 940,000 tons 
per year of coated publication papers, label paper, and other papers, 
which is approximately the same amount of production capacity that 
Verso had after closing the Bucksport mill but before acquiring 
NewPage. In the coated groundwood market in which the Bucksport mill 
competed, the output of the divested mills actually exceeds the output 
of the assets Verso held after it closed the Bucksport mill and before 
it completed the merger. In fact, the Biron mill alone produces more 
coated groundwood than Verso's remaining coated groundwood production 
assets. Furthermore, both the Rumford and Biron mills have a strong 
track record of competitively producing a range of coated publication 
papers and label paper, and Catalyst's ownership of the mills will give 
it a

[[Page 30729]]

market presence comparable to Verso's pre-merger market presence in the 
relevant markets. See also Competitive Impact Statement at 11. For 
these reasons, the Department concluded that Verso's divestiture of the 
Rumford and Biron mills sufficiently redressed the merger's competitive 
harm.
    Local 1821 and Mr. Gilley assert that the Department should have 
required Verso to divest the Bucksport mill. But, as discussed above, 
the Department concluded that the required divestitures would 
sufficiently preserve competition, making the divestiture of the 
Bucksport mill unnecessary. See US Airways, 38 F. Supp. 3d at 75-76 
(explaining that the government is entitled to deference in choice of 
remedies); United States v. Abitibi Consol. Inc., 584 F. Supp. 2d 162, 
166 (D.D.C. 2008) (rejecting claim that paper mill divestiture was too 
small because the government had factual basis for concluding that a 
single mill divestiture was adequate).
    The Bucksport mill, moreover, was less viable than the mills 
included in the Divestiture Assets. The Department carefully reviewed 
evidence related to the Verso mills, including Verso's plans relating 
to the Bucksport mill that pre-dated the merger and deposition 
testimony of senior Verso executives about the future of the Bucksport 
mill. Based on this evidence, the Department concluded that Verso 
closed the Bucksport mill because the mill was not profitable and that 
the merger did not cause the mill's closure.\4\
---------------------------------------------------------------------------

    \4\ Consequently, the closure of the Bucksport mill is not an 
anticompetitive effect of Verso's acquisition of NewPage. See also 
Competitive Impact Statement at 3 n.1.
---------------------------------------------------------------------------

    Notably, Local 1821 made many of the same antitrust arguments about 
the Bucksport mill in a recent--and unsuccessful--lawsuit it brought to 
enjoin Verso's sale of the Bucksport mill to AIM. On December 15, 2014, 
Local 1821 filed a civil action in the United States District Court for 
the District of Maine alleging that the pending sale violated federal 
and state antitrust laws. See Int'l Ass'n of Machinists and Aerospace 
Workers v. Verso Paper Corp., No. 1:14-cv-00530 (JAW), ___F. Supp. 3d 
___, 2015 WL 248819, at *8-*34 (D. Me. Jan. 20, 2015) (attached as 
Exhibit 3). After extensive briefing and oral argument, the Court 
rejected Local 1821's motion for a preliminary injunction and temporary 
restraining order, concluding in a 73-page opinion that Local 1821 had 
not ``met its burden to prove a strong likelihood of success on the 
merits of their claims under federal antitrust law.'' Verso Paper, 2015 
WL 248819, at *73.
2. Catalyst Is an Appropriate Buyer for the Divested Assets
    Local 1821 asserts that Catalyst is not an appropriate buyer for 
the Divestiture Assets because it is insufficiently vigorous and 
independent to compete with Verso. However, Catalyst operated three 
paper mills in British Columbia, Canada, before it acquired the 
Divestiture Assets and the Department thoroughly examined Catalyst 
before approving it as the purchaser of the Divestiture Assets. The 
Department carefully reviewed the proposed transaction, Catalyst's 
plans to compete in the relevant markets, and the transitional 
agreements between Verso and Catalyst.\5\ Based upon this review, the 
Department concluded that Catalyst would be a vigorous and independent 
competitor.

---------------------------------------------------------------------------

    \5\ While Catalyst recently emerged from bankruptcy, bankruptcy 
reorganization is a fairly common occurrence in the paper industry 
and not a sign that Catalyst will not be an effective competitor. 
See, e.g., Judy Newman, NewPage Corp. Emerges from Chapter 11 
Bankruptcy, Wis. State J., Dec. 12, 2012, available at http://host.madison.com/business/newpage-corp-emerges-from-chapter-bankruptcy/article_d31c8f88-4bc8-11e2-9164-001a4bcf887a.html 
(discussing NewPage's emergence from bankruptcy); Press Release, 
AbitibiBowater, AbitibiBowater Emerges from Creditor Protection 
(Dec. 9, 2010), available at http://www.newswire.ca/en/story/586251/abitibibowater-emerges-from-creditor-protection.
---------------------------------------------------------------------------

3. Verso's and Catalyst's Recent Announcements of Price Increases Do 
Not Show That the Department's Proposed Remedy Is Inadequate
    Local 1821 notes that Verso and Catalyst each announced price 
increases in January 2015 and argues that these announced price 
increases demonstrate that the divestiture is inadequate. But Local 
1821 has not offered any evidence that the price increases arise from 
or are connected to the merger. To the contrary, the price increases 
likely are related to a number of factors, including input costs, 
demand fluctuations, and recent and significant capacity reductions in 
the coated groundwood market that are unrelated to the merger. In 
addition to Verso's Bucksport mill closure, coated groundwood paper 
producer Futuremark also closed its Alsip, Illinois coated groundwood 
mill in August 2014. See Press Release, FutureMark Alsip, FutureMark 
Alsip to Idle Mill (Aug. 21, 2014), available at http://www.businesswire.com/news/home/20140821005972/en/#.VUjFcv-Jiig 
(``FutureMark Alsip [] today announced that, due to increasingly 
challenging market conditions in the North American coated paper 
market, it will indefinitely idle its mill in early September.'').
4. Local 1821's Allegations That Other Conduct by Apollo and Verso 
Violated the Antitrust Laws Are Outside the Scope of the Tunney Act
    Lastly, Local 1821 alleges that Apollo, Verso's parent company, has 
engaged in anticompetitive conduct since at least 2011 and argues that 
the Department should have investigated these earlier activities. Local 
1821 also asserts that the Department should investigate whether 
Verso's 2015 sale of the Bucksport mill to AIM violates Section 1 of 
the Sherman Act.
    Although the Department takes all allegations of anticompetitive 
conduct seriously, Local 1821's claim that the United States should 
bring or have brought an enforcement action relating to conduct not 
challenged in the Complaint is outside the scope of this Tunney Act 
proceeding. It is well-settled that the Department's decision to bring 
an action alleging harm is left to the Department's prosecutorial 
discretion and is not part of the court's Tunney Act review. See 
Microsoft, 56 F.3d at 1459 (explaining that in an APPA proceeding, the 
``district court is not empowered to review the actions or behavior of 
the Department of Justice; the court is only authorized to review the 
decree itself''). Indeed, this Court has squarely held that ``a 
district court is not permitted to `reach beyond the complaint to 
evaluate claims that the government did not make and to inquire as to 
why they were not made.' '' SBC Commc'ns, 489 F. Supp. 2d at 14 
(quoting Microsoft, 56 F.3d at 1459) (emphasis in original); see also 
US Airways, 38 F. Supp. 3d at 76. Consequently, Local 1821's 
allegations of anticompetitive conduct not challenged in the Complaint 
do not provide a basis for rejecting the proposed Final Judgment.

V. Conclusion

    After reviewing the public comments, the United States continues to 
believe that the proposed Final Judgment, as drafted, provides an 
effective and appropriate remedy for the antitrust violations alleged 
in the Complaint, and is therefore in the public interest. The United 
States will move this Court to enter the proposed Final Judgment after 
the comments and this response are published in the Federal Register.
    Dated: May 18, 2015
    Respectfully submitted, /s/Karl D. Knutsen., Karl D. Knutsen, 
Richard Martin, Garrett M. Liskey (D.C. Bar No.

[[Page 30730]]

1000937), Attorneys for the United States, Litigation I Section, 
Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW., 
Suite 4100, Washington, DC 20530, Telephone: (202) 514-0976, Facsimile: 
(202) 305-1190, Email: [email protected].
BILLING CODE P
[GRAPHIC] [TIFF OMITTED] TN29MY15.000


[[Page 30731]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.001


[[Page 30732]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.002


[[Page 30733]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.003


[[Page 30734]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.004


[[Page 30735]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.005


[[Page 30736]]


[GRAPHIC] [TIFF OMITTED] TN29MY15.006


[FR Doc. 2015-13025 Filed 5-28-15; 8:45 am]
BILLING CODE C

30726 Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices Annual CITATION 30 Average number burden CFR 254 and Reporting requirement Hour burden of annual re- hours NTLs sponses (rounded) Subpart D—Oil Spill Response Requirements for Facilities Located in State Waters Seaward of the Coast Line 50; 52 ................ Submit response plan for facility in State waters following format for 46.3 ................... 13 plans .............. 602 OCS plan. 50; 51; 52 .......... Submit response plan for facility in State waters by modifying exist- 14.3 ................... 50 plans .............. 715 ing OCS plan. 50; 53; ............... Submit response plan for facility in State waters developed under 40 ...................... 8 plans ................ 320 State requirements including all information as required in these sections. 54 ...................... Submit description of oil-spill prevention procedures and dem- 3.8 ..................... 67 submissions ... 255 onstrate compliance; include any industry safety and pollution prevention standards your facility meets. Subtotal ...................................................................................................................................................... 138 responses .... 1,892 hours Total Hour Burden ............................................................................................................................. 1,610 Responses 74,461 Hours Estimated Reporting and result of your comments, we will make (telephone: 202–514–2481), on the Recordkeeping Non-Hour Cost Burden: any necessary adjustments to the burden Department of Justice’s Web site at We have identified no non-hour cost in our submission to OMB. http://www.justice.gov/atr/cases/ burdens for this collection. Public Comment Procedures: Before verso.html, and at the Office of the Clerk Public Disclosure Statement: The PRA including your address, phone number, of the United States District Court for (44 U.S.C. 3501, et seq.) provides that an email address, or other personal the District of Columbia, 333 agency may not conduct or sponsor a identifying information in your Constitution Avenue NW., Washington, collection of information unless it comment, you should be aware that DC 20001. Copies of any of these displays a currently valid OMB control your entire comment—including your materials may also be obtained upon number. Until OMB approves a personal identifying information—may request and payment of a copying fee. collection of information, you are not be made publicly available at any time. Patricia A. Brink, obligated to respond. While you can ask us in your comment to withhold your personal identifying Director of Civil Enforcement. Comments: Before submitting an ICR to OMB, PRA section 3506(c)(2)(A) information from public review, we United States District Court for the requires each agency ‘‘. . . to provide cannot guarantee that we will be able to District of Columbia notice . . . and otherwise consult with do so. UNITED STATES OF AMERICA, members of the public and affected Dated: May 20, 2015. Plaintiff, v. VERSO PAPER CORP., and agencies concerning each proposed Robert Middleton, NEWPAGE HOLDINGS INC., collection of information . . .’’. Deputy Chief, Office of Offshore Regulatory Defendants. Agencies must specifically solicit Programs. Case No. 1:14–cv–2216 (TSC) comments to: (a) Evaluate whether the [FR Doc. 2015–13003 Filed 5–28–15; 8:45 am] collection is necessary or useful; (b) Response of Plaintiff United States to BILLING CODE 4310–VH–P evaluate the accuracy of the burden of Public Comments on the Proposed Final the proposed collection of information; Judgment (c) enhance the quality, usefulness, and DEPARTMENT OF JUSTICE Pursuant to the requirements of the clarity of the information to be Antitrust Procedures and Penalties Act, collected; and (d) minimize the burden Antitrust Division 15 U.S.C. § 16(b)–(h) (‘‘APPA’’ or on the respondents, including the use of ‘‘Tunney Act’’), the United States technology. United States v. Verso Paper Corp. and hereby responds to the public comments Agencies must also estimate the non- NewPage Holdings Inc.; Public received regarding the proposed Final hour paperwork cost burdens to Comments and Response on Proposed Judgment in this case. After careful respondents or recordkeepers resulting Final Judgment consideration of the submitted from the collection of information. Pursuant to the Antitrust Procedures comments, the United States continues Therefore, if you have other than hour and Penalties Act, 15 U.S.C. 16(b)–(h), to believe that the proposed Final burden costs to generate, maintain, and the United States hereby publishes Judgment will provide an effective and disclose this information, you should below the comments received on the appropriate remedy for the antitrust comment and provide your total capital proposed Final Judgment in United violations alleged in the Complaint. The and startup cost components or annual States v. Verso Paper Corp., et al., Civil United States will move the Court for operation, maintenance, and purchase Action No. 1:14–CV–2216–TSC (D.D.C. entry of the proposed Final Judgment of service components. For further 2014), together with the Response of the after the public comments and this Lhorne on DSK2VPTVN1PROD with NOTICES information on this burden, refer to 5 United States to Public Comments. response have been published in the CFR 1320.3(b)(1) and (2), or contact the Copies of the comments, attachments Federal Register pursuant to 15 U.S.C. Bureau representative listed previously to these comments, and the United § 16(d).1 in this notice. States’ Response are available for 1 On May 7, 2015, the United States submitted its We will summarize written responses inspection at the Department of Justice Unopposed Motion and Supporting Memorandum to this notice and address them in our Antitrust Division, 450 Fifth Street NW., to Excuse Federal Register Publication of submission for OMB approval. As a Suite 1010, Washington, DC 20530 Attachments to Public Comments requesting that VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00076 Fmt 4703 Sfmt 4703 E:\FR\FM\29MYN1.SGM 29MYN1

Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices 30727 I. Procedural History coated paper markets, deposed 12 Verso violations, provisions for enforcement and and NewPage employees, and consulted modification, duration of relief sought, On January 3, 2014, Verso Paper Corp. anticipated effects of alternative remedies (‘‘Verso’’) entered into an agreement to with industry experts. The Department actually considered, whether its terms are acquire NewPage Holdings Inc. carefully analyzed the information it ambiguous, and any other competitive (‘‘NewPage’’) in a transaction valued at obtained from these sources and considerations bearing upon the adequacy of approximately $1.4 billion.2 The United thoroughly considered all of the issues such judgment that the court deems States filed a civil antitrust Complaint presented. necessary to a determination of whether the The Department found that the consent judgment is in the public interest; on December 31, 2014, seeking to enjoin proposed acquisition would likely have and Verso from acquiring NewPage. The (B) the impact of entry of such judgment eliminated substantial head-to-head United States alleged in its Complaint upon competition in the relevant market or competition in the relevant markets that the acquisition likely would markets, upon the public generally and between Verso and NewPage, providing substantially lessen competition in the individuals alleging specific injury from the the combined firm with an incentive to violations set forth in the complaint sale of coated freesheet web paper, raise prices and reduce output. The coated groundwood paper, and label including consideration of the public benefit, Department also found in the coated if any, to be derived from a determination of papers to customers in North America freesheet web paper and coated the issues at trial. in violation of Section 7 of the Clayton groundwood paper markets that the Act, 15 U.S.C. § 18. At the time the 15 U.S.C. § 16(e)(1). In considering these transaction would have likely caused statutory factors, the court’s inquiry is Complaint was filed, Verso and the remaining players to accommodate NewPage were vigorous competitors in necessarily a limited one as the one another’s price increases and output government is entitled to ‘‘broad these coated paper markets. reductions. Overall, the Department Simultaneously with the filing of the discretion to settle with the defendant concluded that if Verso and NewPage within the reaches of the public Complaint, the United States filed a had completed the proposed transaction proposed Final Judgment and a interest.’’ United States v. Microsoft as structured, the loss of competition Corp., 56 F.3d 1448, 1461 (D.C. Cir. Stipulation signed by Plaintiff and likely would have resulted in higher Defendants consenting to entry of the 1995); see also United States v. SBC prices to consumers. For these reasons, Commc’ns, Inc., 489 F. Supp. 2d 1, 10– proposed Final Judgment after the Department filed a civil antitrust compliance with the requirements of the 11 (D.D.C. 2007) (assessing public lawsuit to block the merger and alleged interest standard under the Tunney Tunney Act, 15 U.S.C. § 16, and a that the proposed transaction violated Competitive Impact Statement (‘‘CIS’’) Act); United States v. InBev N.V./S.A., Section 7 of the Clayton Act, 15 U.S.C. No. 08–cv–1965 (JR), 2009 U.S. Dist. describing the transaction and the § 18. proposed Final Judgment. The United LEXIS 84787, at *3 (D.D.C. Aug. 11, The proposed Final Judgment States published the proposed Final 2009) (discussing nature of review of eliminates the anticompetitive effects Judgment and CIS in the Federal identified in the Complaint by requiring consent judgment under the Tunney Register on January 14, 2015, see 80 FR Defendants to divest NewPage’s Act; inquiry is limited to ‘‘whether the 1957, and caused summaries of the Rumford, Maine and Biron, Wisconsin government’s determination that the proposed Final Judgment and CIS, paper mills and related assets proposed remedies will cure the together with directions for the (collectively, ‘‘the Divestiture Assets’’) antitrust violations alleged in the submission of written comments to Catalyst Paper Corporation complaint was reasonable, and whether relating to the proposed Final Judgment, (‘‘Catalyst’’) on terms acceptable to the the mechanisms to enforce the final to be published in The Washington Post United States. The divestitures judgment are clear and manageable’’). on January 14, 15, 16, 19, 20, 21, and eliminate the anticompetitive effects of Under the APPA, a court considers, 22, 2015. The 60-day period for public the transaction by transferring the among other things, the relationship comment ended on March 24, 2015. The Rumford and Biron paper mills to a between the remedy secured and the United States received two comments, vigorous and independent competitor specific allegations set forth in the as described below and attached hereto and preserving the pre-merger market Complaint, whether the decree is as Exhibits 1 and 2. structure in the coated freesheet web sufficiently clear, whether the paper, coated groundwood paper, and enforcement mechanisms are sufficient, II. The Investigation and the Proposed and whether the decree may positively Resolution label paper markets. Since the United States submitted the harm third parties. See Microsoft, 56 The proposed Final Judgment is the proposed Final Judgment on December F.3d at 1458–62. With respect to the culmination of a nearly year-long 31, 2014, Verso has acquired NewPage, adequacy of the relief secured by the investigation by the Antitrust Division and Catalyst has acquired and is decree, a court may not ‘‘engage in an of the United States Department of operating the Divestiture Assets. unrestricted evaluation of what relief Justice (‘‘Department’’) of the proposed would best serve the public.’’ United transaction. As part of its investigation, III. Standard of Judicial Review States v. BNS, Inc., 858 F.2d 456, 462 the Department issued 19 Civil The APPA requires that proposed (9th Cir. 1988) (citing United States v. Investigative Demands for documents consent judgments in antitrust cases Bechtel Corp., 648 F.2d 660, 666 (9th and information to third parties, brought by the United States be subject Cir. 1981)). Instead, courts have held collected almost one million documents to a 60-day public comment period, that: from the Defendants and third parties, after which the court shall determine [t]he balancing of competing social and interviewed more than 100 customers, whether entry of the proposed Final political interests affected by a proposed Lhorne on DSK2VPTVN1PROD with NOTICES brokers, and competitors in the relevant Judgment ‘‘is in the public interest.’’ 15 antitrust consent decree must be left, in the U.S.C. § 16(e)(1). In making that first instance, to the discretion of the this Court authorize an alternative means for determination, the court, in accordance Attorney General. The court’s role in publishing the attachments to the public comments with the statute as amended in 2004, is protecting the public interest is one of received in this action. (Docket No. 11.) insuring that the government has not 2 After the United States initiated this action on required to consider: breached its duty to the public in consenting December 31, 2014, Verso Paper Corp. changed its (A) The competitive impact of such to the decree. The court is required to name to Verso Corporation. judgment, including termination of alleged determine not whether a particular decree is VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 E:\FR\FM\29MYN1.SGM 29MYN1

30728 Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices the one that will best serve society, but intent to preserve the practical benefits and (4) the United States should have whether the settlement in ‘‘within the of using consent decrees in antitrust investigated alleged anticompetitive reaches of the public interest.’’ More enforcement, adding the unambiguous conduct that Verso’s parent company, elaborate requirements might undermine the instruction that ‘‘[n]othing in this Apollo Capital Management (‘‘Apollo’’), effectiveness of antitrust enforcement by consent decree. section shall be construed to require the has engaged in since at least 2011, court to conduct an evidentiary hearing including efforts to buy NewPage, Bechtel, 648 F.2d at 666 (emphasis or to require the court to permit anyone acquiring NewPage’s debt to influence added) (citations omitted). to intervene.’’ 15 U.S.C. § 16(e)(2). The its business operations, and causing In determining whether a proposed procedure for the public interest Verso and NewPage to shut down mills settlement is in the public interest, ‘‘the determination is left to the discretion of in order to reduce output and raise court ‘must accord deference to the the court, with the recognition that the prices. Local 1821 further argues that government’s predictions about the court’s ‘‘scope of review remains the Department should open an efficacy of its remedies.’’’ United States sharply proscribed by precedent and the investigation into whether the sale of v. U.S. Airways Grp., Inc., 38 F. Supp. nature of the Tunney Act proceedings.’’ the Bucksport mill to AIM violated 3d 69, 76 (D.D.C. 2014) (quoting SBC SBC Commc’ns, 489 F. Supp. 2d at 11; Section 1 of the Sherman Act. Commc’ns, 489 F. Supp. at 17). See also see also United States v. Enova Corp., Herbert R. Gilley also submitted a Microsoft, 56 F.3d at 1461 (noting that 107 F. Supp. 2d 10, 17 (D.D.C. 2000) comment. Mr. Gilley, who is not a the government is entitled to deference (‘‘[T]he Tunney Act expressly allows the member of Local 1821, worked at the as to its ‘‘predictions as to the effect of court to make its public interest Bucksport mill for more than 38 years the proposed remedies’’); United States determination on the basis of the before losing his job when the mill v. Archer-Daniels-Midland Co., 272 F. competitive impact statement and closed. In his comment, Mr. Gilley Supp. 2d 1, 6 (D.D.C. 2003) (noting that response to public comments alone.’’). similarly contests the closure and sale of the court should grant due respect to the the Bucksport mill and argues that the United States’ ‘‘prediction as to the IV. Summary of Public Comments and closure was anticompetive and will effect of the proposed remedies, its the United States’ Response result in reduced output and higher perception of the market structure, and A. Summary of the Public Comments prices. its views of the nature of the case’’); United States v. Morgan Stanley, 881 F. During the 60-day comment period, B. The United States’ Response to the Supp. 2d 563, 567–68 (S.D.N.Y. 2012) the United States received two Public Comments (explaining that the government is comments regarding the proposed Final 1. The Divestiture Assets Are Sufficient entitled to deference in choice of Judgment, although no comments were To Remedy the Harm Alleged in the remedies). received from any printer, publisher, or Complaint Courts ‘‘may not require that the other paper customer. The only remedies perfectly match the alleged comments were made by former Local 1821 and Mr. Gilley argue that violations.’’ SBC Commc’ns, 489 F. employees of the now closed Bucksport, the required divestitures are not Supp. 2d at 17. Rather, the ultimate Maine paper mill. Verso produced sufficient to prevent the merger’s question is whether ‘‘the remedies coated groundwood and specialty paper anticompetitive effects and assert that [obtained in the decree are] so products at the Bucksport mill until additional paper mills, including inconsonant with the allegations closing the mill in December 2014 and Verso’s Bucksport mill, should have charged as to fall outside of the ‘reaches selling it to AIM Development (USA) been included in the divestiture of the public interest.’ ’’ Microsoft, 56 LLC (‘‘AIM’’). AIM is the U.S. subsidiary package. But the required divestitures F.3d at 1461. Accordingly, the United of American Iron & Metal, Inc., a essentially preserve the preexisting States ‘‘need only provide a factual basis company that purchases discontinued competitive structure of the affected for concluding that the settlements are manufacturing facilities and salvages coated paper markets by providing reasonably adequate remedies for the the metal. Both comments focus upon Catalyst with approximately the same alleged harms.’’ SBC Commc’ns, 489 F. competition in the coated groundwood capacity as Verso had prior to the Supp. 2d at 17. And, a ‘‘proposed decree paper market and the closure of the merger. The divested Rumford and must be approved even if it falls short Bucksport mill. Biron mills produced approximately of the remedy the court would impose Local 1821 of the International 940,000 tons per year of coated on its own, as long as it falls within the Association of Machinists and publication papers, label paper, and range of acceptability or is within the Aerospace Workers (‘‘Local 1821’’), other papers, which is approximately reaches of the public interest.’’ United consisting of 58 former employees of the the same amount of production capacity States v. Am. Tel. & Tel. Co., 552 F. Bucksport mill, submitted a comment that Verso had after closing the Supp. 131, 151 (D.D.C. 1982) (citations arguing that: (1) The divestitures Bucksport mill but before acquiring and internal quotations omitted); see provided by the proposed Final NewPage. In the coated groundwood also United States v. Alcan Aluminum Judgment are inadequate to redress the market in which the Bucksport mill Ltd., 605 F. Supp. 619, 622 (W.D. Ky. merger’s anticompetitive effects and competed, the output of the divested 1985) (approving the consent decree should have included the Bucksport mills actually exceeds the output of the even though the court would have mill; (2) Catalyst is an insufficiently assets Verso held after it closed the imposed a greater remedy). independent and vigorous competitor Bucksport mill and before it completed In its 2004 amendments to the and should not have been selected as the merger. In fact, the Biron mill alone Tunney Act,3 Congress made clear its the buyer of the Divestiture Assets; (3) produces more coated groundwood than Lhorne on DSK2VPTVN1PROD with NOTICES recent price increases by Verso and Verso’s remaining coated groundwood 3 The 2004 amendments substituted ‘‘shall’’ for Catalyst demonstrate the failure of the production assets. Furthermore, both ‘‘may’’ in directing relevant factors for courts to proposed Final Judgment to remedy the the Rumford and Biron mills have a consider and amended the list of factors to focus on strong track record of competitively competitive considerations and to address transaction’s anticompetitive effects; potentially ambiguous judgment terms. Compare 15 producing a range of coated publication U.S.C. § 16(e) (2004), with 15 U.S.C. § 16(e)(1) 11 (concluding that the 2004 amendments ‘‘effected papers and label paper, and Catalyst’s (2006); see also SBC Commc’ns, 489 F. Supp. 2d at minimal changes’’ to Tunney Act review). ownership of the mills will give it a VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 E:\FR\FM\29MYN1.SGM 29MYN1

Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices 30729 market presence comparable to Verso’s federal antitrust law.’’ Verso Paper, market conditions in the North pre-merger market presence in the 2015 WL 248819, at *73. American coated paper market, it will relevant markets. See also Competitive indefinitely idle its mill in early 2. Catalyst Is an Appropriate Buyer for Impact Statement at 11. For these September.’’). the Divested Assets reasons, the Department concluded that 4. Local 1821’s Allegations That Other Verso’s divestiture of the Rumford and Local 1821 asserts that Catalyst is not an appropriate buyer for the Divestiture Conduct by Apollo and Verso Violated Biron mills sufficiently redressed the the Antitrust Laws Are Outside the merger’s competitive harm. Assets because it is insufficiently vigorous and independent to compete Scope of the Tunney Act Local 1821 and Mr. Gilley assert that with Verso. However, Catalyst operated Lastly, Local 1821 alleges that Apollo, the Department should have required three paper mills in British Columbia, Verso’s parent company, has engaged in Verso to divest the Bucksport mill. But, Canada, before it acquired the anticompetitive conduct since at least as discussed above, the Department Divestiture Assets and the Department 2011 and argues that the Department concluded that the required divestitures thoroughly examined Catalyst before should have investigated these earlier would sufficiently preserve activities. Local 1821 also asserts that competition, making the divestiture of approving it as the purchaser of the Divestiture Assets. The Department the Department should investigate the Bucksport mill unnecessary. See US whether Verso’s 2015 sale of the Airways, 38 F. Supp. 3d at 75–76 carefully reviewed the proposed transaction, Catalyst’s plans to compete Bucksport mill to AIM violates Section (explaining that the government is 1 of the Sherman Act. entitled to deference in choice of in the relevant markets, and the transitional agreements between Verso Although the Department takes all remedies); United States v. Abitibi allegations of anticompetitive conduct Consol. Inc., 584 F. Supp. 2d 162, 166 and Catalyst.5 Based upon this review, the Department concluded that Catalyst seriously, Local 1821’s claim that the (D.D.C. 2008) (rejecting claim that paper United States should bring or have mill divestiture was too small because would be a vigorous and independent competitor. brought an enforcement action relating the government had factual basis for to conduct not challenged in the concluding that a single mill divestiture Complaint is outside the scope of this was adequate). Tunney Act proceeding. It is well- 3. Verso’s and Catalyst’s Recent The Bucksport mill, moreover, was Announcements of Price Increases Do settled that the Department’s decision to less viable than the mills included in Not Show That the Department’s bring an action alleging harm is left to the Divestiture Assets. The Department Proposed Remedy Is Inadequate the Department’s prosecutorial carefully reviewed evidence related to discretion and is not part of the court’s the Verso mills, including Verso’s plans Local 1821 notes that Verso and Tunney Act review. See Microsoft, 56 relating to the Bucksport mill that pre- Catalyst each announced price increases F.3d at 1459 (explaining that in an dated the merger and deposition in January 2015 and argues that these APPA proceeding, the ‘‘district court is testimony of senior Verso executives announced price increases demonstrate not empowered to review the actions or about the future of the Bucksport mill. that the divestiture is inadequate. But behavior of the Department of Justice; Based on this evidence, the Department Local 1821 has not offered any evidence the court is only authorized to review concluded that Verso closed the that the price increases arise from or are the decree itself’’). Indeed, this Court Bucksport mill because the mill was not connected to the merger. To the has squarely held that ‘‘a district court profitable and that the merger did not contrary, the price increases likely are is not permitted to ‘reach beyond the cause the mill’s closure.4 related to a number of factors, including complaint to evaluate claims that the input costs, demand fluctuations, and Notably, Local 1821 made many of the government did not make and to inquire recent and significant capacity same antitrust arguments about the as to why they were not made.’ ’’ SBC reductions in the coated groundwood Bucksport mill in a recent—and Commc’ns, 489 F. Supp. 2d at 14 market that are unrelated to the merger. unsuccessful—lawsuit it brought to (quoting Microsoft, 56 F.3d at 1459) In addition to Verso’s Bucksport mill enjoin Verso’s sale of the Bucksport mill (emphasis in original); see also US closure, coated groundwood paper to AIM. On December 15, 2014, Local Airways, 38 F. Supp. 3d at 76. producer Futuremark also closed its 1821 filed a civil action in the United Consequently, Local 1821’s allegations Alsip, Illinois coated groundwood mill States District Court for the District of of anticompetitive conduct not in August 2014. See Press Release, Maine alleging that the pending sale challenged in the Complaint do not FutureMark Alsip, FutureMark Alsip to violated federal and state antitrust laws. provide a basis for rejecting the Idle Mill (Aug. 21, 2014), available at See Int’l Ass’n of Machinists and proposed Final Judgment. http://www.businesswire.com/news/ Aerospace Workers v. Verso Paper home/20140821005972/en/#.VUjFcv-Jiig V. Conclusion Corp., No. 1:14–cv–00530 (JAW), lll (‘‘FutureMark Alsip [] today announced F. Supp. 3d lll, 2015 WL 248819, at After reviewing the public comments, that, due to increasingly challenging the United States continues to believe *8–*34 (D. Me. Jan. 20, 2015) (attached as Exhibit 3). After extensive briefing that the proposed Final Judgment, as 5 While Catalyst recently emerged from and oral argument, the Court rejected bankruptcy, bankruptcy reorganization is a fairly drafted, provides an effective and Local 1821’s motion for a preliminary common occurrence in the paper industry and not appropriate remedy for the antitrust injunction and temporary restraining a sign that Catalyst will not be an effective violations alleged in the Complaint, and competitor. See, e.g., Judy Newman, NewPage Corp. is therefore in the public interest. The order, concluding in a 73-page opinion Emerges from Chapter 11 Bankruptcy, Wis. State J., that Local 1821 had not ‘‘met its burden United States will move this Court to Lhorne on DSK2VPTVN1PROD with NOTICES Dec. 12, 2012, available at http:// to prove a strong likelihood of success host.madison.com/business/newpage-corp-emerges- enter the proposed Final Judgment after on the merits of their claims under from-chapter-bankruptcy/article_d31c8f88-4bc8- the comments and this response are 11e2-9164-001a4bcf887a.html (discussing published in the Federal Register. NewPage’s emergence from bankruptcy); Press Dated: May 18, 2015 4 Consequently, the closure of the Bucksport mill Release, AbitibiBowater, AbitibiBowater Emerges is not an anticompetitive effect of Verso’s from Creditor Protection (Dec. 9, 2010), available at Respectfully submitted, /s/Karl D. acquisition of NewPage. See also Competitive http://www.newswire.ca/en/story/586251/ Knutsen., Karl D. Knutsen, Richard Impact Statement at 3 n.1. abitibibowater-emerges-from-creditor-protection. Martin, Garrett M. Liskey (D.C. Bar No. VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\29MYN1.SGM 29MYN1

30730 Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices 1000937), Attorneys for the United 450 Fifth Street NW., Suite 4100, (202) 514–0976, Facsimile: (202) 305– States, Litigation I Section, Antitrust Washington, DC 20530, Telephone: 1190, Email: karl.knutsen@usdoj.gov. Division, U.S. Department of Justice, BILLING CODE P From: [REDACTED] Sent: Tuesday, January 06, 2015 10:49 AM To: Knutsen, Karl Subject: Verso paper merger case #1 :14-cv-2216 Hi Karl Just would like to express my opinion on the Verso,Newpage merger seeing how I have nothing but time on my hands looking for a new job after working 38+ years at the Bucksport Maine mill. I am quite sure I wont get a response because I have also filed a complaint with the consumer complaint division and both times they responded with a automated response stating someone would contact me,not yet? So my concern is that you approved the merger and I still believe their is a anti trust violation concerning them scrapping the Bucksport mill? This will take paper off the market and it will drive the price up and it eliminates competition doesn't it and also Lyle Fellows from Verso stated they would not sell the mill to a competitor but was open for other options(scrapping the mill)? As I stated I have operate a paper machine for 38 years and I still believe that we can make a go at Bucksport if the mill is sold to another company that wants to make paper not take advantages of government and town,state tax breaks like Verso has. Since Verso has bought us we have not made a profit in 8 plus years but they we remained taking concessions thru bargaining and yet we still produced the best sheet of paper and still broke production records along with safety records and they couldn't make a profit? You might want to look at how they do their book keeping as far as shifting costs from one mill to the other. So on that note how can a mill get 30 to 40 million in tax credits and tax breaks to put into the power plant and turn around and shut down 3 paper machines and sell the mill to a scrap company(AIM) for 58 million when the power plant is worth 2 to 3 times more than that and the machines are still capable in making paper. All we want at Bucksport is to at least get a chance like the other mills in the state to try and make it go and if the Bucksport Mill cant make money then why is VERSO so afraid of selling it ? There is at least 2 companies interested in buying the mill to make paper and the state of Maine is aware of that but cannot force Verso to sell to them because Verso is more concerned in taking the paper off the market. I really believe that your department can force verso to sell and you can do so by getting involved with the pending lawsuit that International Machinist Union has coming up with Judge Woodcock this month on Jan 13th.this lawsuit is the only thing that can save the jobs at Bucksport and if we don't stop corporate Greed and big businesses controlling our government pretty soon we wont have any working people left to pay taxes then how will you people keep your jobs? Enough said and would look forward to hear from you or anyone else about this matter. Thank You Herbert R Gilley [PERSONAL INFORMATION REDACTED] Lhorne on DSK2VPTVN1PROD with NOTICES EN29MY15.000</GPH> VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4725 E:\FR\FM\29MYN1.SGM 29MYN1

Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices 30731 Kim Ervin Tucker March 12, 2015 Dem· Mucchetti: Lhorne on DSK2VPTVN1PROD with NOTICES EN29MY15.001</GPH> VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00081 Fmt 4703 Sfmt 4725 E:\FR\FM\29MYN1.SGM 29MYN1

30732 Federal Register/Vol. 80, No. 103 /Friday, May 29, 2015 /Notices Tunney Act Protest Letter Re: Verso—NewPage Merger March 11, 20153 Page 2 Friday January 30, 2015 This price increase was followed in quick succession with a similar price increase by Catalyst —the very entity to which the divested Biron and Rumford Mills were soid in order to "eliminate the anticompetitive effects of the [NewPage] acquisition in the North Anmperican market for coated publication papers by establishing a new, independent, and cconomically—viable competitor" (Competitive Impact Statement p. 9)° Ironically, the Verso price increase occurred on the very daythat the Division advised representatives of employess from the Bucksport Mill that the Division would—not, under anycireumstances, open an inquiry into the sale and closure ofthe Bucksport Mill by Verso to a serap dealer ({rather than a competitor willing to pay more to continue to operate the Mill). As the Division‘s Complaint asserts, the Verso—NewPage Merger violates Section 7 of the Clayton Act. We believe that it also involves likely violations of Sections 1 and 2 ofthe Sherman Act. So far, requiring the divestiture of only the Biron and Rumford Mills to Catalyst has done less than nothing to reduce or even slow—down the adverse impact on consumers, direct and indirect, ofthe anticompetitive consequences of allowing this merger to proceed. A bigger divestiture package, to a more independent and vigorous competitor than Catalyst (which recently emerged from bankruptey), might have provided greater consumer protections, but this option was expressly rejected bythe Division when proposed by me and my colleagues on behalfof the employees of the Bucksport Mill. The fact that Verso Corporation acted with such haste to increase prices after the merger deal with NewPage was approved by the Division —not even waiting until the 60—day Tunney Act comment period was past— demonstrates the impunity with which Verso will act now that it has been granted near monopolystatus in the North American coated printing paper market. Further: Catalyst‘s immediate adoption of the price increase that Verso announced last month demonstrates that the divestiture ofthe Biron and Rumford Mills to Catalyst was, and 1s, a grossly madequate remedy to prevent or delay the inevitable anticompetitive consequences of approving the Verso— NewPage Merger —utterlybereft of any chance ofprotecting direct and indirect consumers of coated paper products, now or in the future. The Antitrust Division‘s Too Narrow Focus The Division‘s inquiry into the Verso—NewPage Merger was fatally flawed from the outset, because of Lifigation 1 Section‘s apparent limitation of its invesfigation to consideration of only events after the initial public announcement of this proposed merger by Verso and NewPage in Janiary of2014. This myopic 2014—centric focus on events and actions failed to put this merger in a realistic {and accurate) competitive context and ignored ample evidence, available from publicly—available sources, regarding the lengths to which Apollo Global Management ("Apollo"). Verso‘s parent, had gone to use its acquisition of NewPage‘s second lien debt in 2011 as leverage * "Price hike prospects brighten on coated as Yerso announces immediate $20—40 CFS, CM, SC increases", PPI Pulp & Paper Week, Tanuary 30, 20185. This price increase information is available at: hittpofwow w rivinto.com|pulp—paperppippw/Price—hike—prospec ts—brightermon—consted—as—Verso«nnounces—immediate= i 20—0—CF S—CM—~SC—ncreases htm| * "Catalyst announces Apr. 1 price increase of $40/ton for Its coated freesheet, CM, and high—brite grades in the US", PPI Pulp & Paper Week, February6, 2015, aveilable. at hittpss /orww sisuinfo. com puip—paperppippwCatalyst— announces—Pupr— | —price—increase—of—40ton—for—Its—coated—freesheet—ChM—andhigh—brite—grades n—the—US htm1

Tunney Verso—NewPage Merger March 11, Page 3 to foree a Verso—NewPage merger and to have both Verso—and NewPage reduce capacity prior to the merger Apollo has sought to achieve since 2011 Even the most cursory review of publicly available sources reveals that the January 2014 announcement of a Verso—NewPage merger was merelythe most recent step in Apollo‘s quest to reduce competition by shutting down capacity and achieving this merger, In fact, a Verso— NewPage merger has been a goal actively pursued by Apolio. Verso‘s parent, since at least 2011 — — when Apollo acquired a significant amountof NewPage‘s second lien debt and began exerting influence to force a Verso—NewPage merger. Publicly available sources reveal; (1) discussions of a merger between Verso and NewPage in 2011 and 2012; (i1) public claims by Verso of abandonment ofinterest in a merger with NewPage by imd—vear in 2011, whileApollo was simultancously attempting to use its status as a second line debt holder to force a Verso—NewPage merger through the NewPage bankruptey proceedings in the Delaware BRankruptey Court {efforts that continued through at least August 2012);" and (ifi) evidence that Verso and NewPage have engaged in a campaign to restrain competition and reduce industry capacity, by scrapping the equipment and physical plants of otherwise operational and productive paper mills with the help of AIM Development (USAYy LLC. Attached to this letter, as Exhibit B, is the Chronology that representatives of the Bucksport Mill employees previously provided to the Division, but which the Division chose to ignore. This Chronclogy lays out some of the pattern of conduct, engaged in by Apollo in conjunction with Verso and NewPage, to reduce capacity in anticipation ofa Verso—NewPage merger, and committed in furtherance of an anticompetitive scheme to increase Verso‘s market power after such a merger. This pattern includes: i) shutting down and scrapping paper making machinery and laying off hundreds of workers at Verso‘s Sarter|l and Bucksport Mills in 2011; (ii) the destruction .of two viable and productive paper mills (NewPage‘s Kimberly, WI mill, and Verso‘s Sartell, MN mill) in 2011 through 2013; and (iii) the pending destruction of the Bucksport Mill as ways ofreducing capacity in order to facilitate post—merger pricing increases. All ofthese three facilities (Kimberly, Sartell and Bucksport) have been sold to the scrap metal company AIM Development (USA) LLC »— which has destroyed the paper making capacity ofthe first two mills and has indicated an intent to do the same with the Bucksport Mill, while spinning off the clectrical assets of these facilities (after the electric plants had been upgraded with milions of dollars in public funds in the case of Sartell and Bucksport)." 4 Law36Q, "Ferso Paper publicly ended talks to acquire NewPage:" by Jamie Santo (Spetember 5; 2012) httpolwowey. taw360. com(articles/37 5444/verso—paper—ends—tslke—to—noquiresnewpage hitpsfworw law360.comfarticles/37 5444/attachments 0 * Despite the availability of buyers willing to purchase the Bucksport Mill for more than AIM paid, on March 11, 201 5, AIM‘s agents announced that the Mill‘s equipment will be anctioned off on March 24, 201 5 —the same patterm used prior to the razmg of the Sartell and Kimberly Mills, that have still left those communities im ruin. Bangor Daily News, "Former Ferso Equipment to go upfor Auction," by Bill Trotier (March 11, 2015) hitp=bangordalynews.com/201 5031 | fmewshancockformerverso—equipment—to—pooup—for— auchon‘futm source=BDN News+ Updates&utm campaign=e‘cebld32¢c— RSS AFTERNOONUPDATE_ EMAIL CAMPAIGN&utmmedium=email&utm.term=0.7l5eed3192—e7ccb1d3%c— 8321111

30734 Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices Act Protest Letter Re: 2015 asp.:ctofthe Division-s failur.: it would the has im'"'''"£1 Lhorne on DSK2VPTVN1PROD with NOTICES EN29MY15.004</GPH> VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4725 E:\FR\FM\29MYN1.SGM 29MYN1

Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices 30735 Act Protest Letter Re: 2015 of the State of Maim.:_ to sell this \·aluablc the Division's own estimate in the to rebuild from continue to operate in the market. Lhorne on DSK2VPTVN1PROD with NOTICES EN29MY15.005</GPH> VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00085 Fmt 4703 Sfmt 4725 E:\FR\FM\29MYN1.SGM 29MYN1

30736 Federal Register / Vol. 80, No. 103 / Friday, May 29, 2015 / Notices [FR Doc. 2015–13025 Filed 5–28–15; 8:45 am] DEPARTMENT OF LABOR (EBSA) sponsored information BILLING CODE C collection request (ICR) titled, Office of the Secretary ‘‘Disclosures by Insurers to General Account Policyholders,’’ to the Office of Agency Information Collection Management and Budget (OMB) for Activities; Submission for OMB review and approval for continued use, Review; Comment Request; without change, in accordance with the Disclosures by Insurers to General Lhorne on DSK2VPTVN1PROD with NOTICES Account Policyholders Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq. Public ACTION: Notice. comments on the ICR are invited. DATES: The OMB will consider all SUMMARY: The Department of Labor written comments that agency receives (DOL) is submitting the Employee on or before June 29, 2015. EN29MY15.006</GPH> Benefits Security Administration VerDate Sep<11>2014 15:17 May 28, 2015 Jkt 235001 PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 E:\FR\FM\29MYN1.SGM 29MYN1


Document Created: 2015-12-15 15:31:34
Document Modified: 2015-12-15 15:31:34
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation80 FR 30726 
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR