[Federal Register Volume 59, Number 91 (Thursday, May 12, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-11572]


[[Page Unknown]]

[Federal Register: May 12, 1994]


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DEPARTMENT OF JUSTICE
 

U.S. v. Tele-Communications, Inc. and Liberty Media Corporation; 
Proposed Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. section 16 (b) through (h), that a proposed 
Final Judgment, a Stipulation and a Competitive Impact Statement have 
been filed with the United States District Court for the District of 
Columbia in United States of America v. Tele-Communications, Inc. and 
Liberty Media Corporation, Civil No. 94-0948.
    The Complaint in the case alleges that the effect of the proposed 
merger between the two defendants, Tele-Communications, Inc. and 
Liberty Media Corporation, may be substantially to lessen competition 
among multichannel subscription television providers and video 
programming providers.
    The proposed Final Judgment enjoins the defendants from (A) 
discriminating against unaffiliated video programming offered by such 
providers, where the effect of such discrimination is unreasonably to 
restrain competition; and (B) discriminating against unaffiliated 
multichannel subscription television providers in the sale or license 
of video programming, where the effect of such discrimination is 
unreasonably to restrain competition. These injunctions apply with 
respect to the conduct of organizations under the defendants' control. 
With interest not amounting to control, the proposed Final Judgment 
enjoins defendants from seeking or supporting conduct that would 
violate (A) or (B) above is engaged in directly by defendants.
    Public comment on the proposed Final Judgment is invited within the 
statutory 60-day comment period. Such comments and responses thereto 
will be published in the Federal Register and filed with the Court. 
Comments should be directed to Richard L. Rosen, Chief, Communications 
and Finance Section, Antitrust Division, Department of Justice, 555 4th 
Street NW., room 8104, Washington, DC 20001 (telephone: 202/514-5621).
Constance K. Robinson,
Director of Operations, Antitrust Division.

Stipulation

    United States of America, Plaintiff, v. Tele-Communications, 
Inc. and Liberty Media Corporation, Defendants.

    Civil Action No. 94-0948, Judge Richey, Filed: 4/28/94.

    It is stipulated by and between the undersigned parties, by their 
respective attorneys, that:
    1. The parties to this Stipulation consent that a Final Judgment in 
the form attached may be filed and entered by the Court, upon any 
party's or the Court's own motion, at any time after compliance with 
the requirements of the Antitrust Procedures and Penalties Act (15 
U.S.C. 16), without further notice to any party or other proceedings, 
provided that plaintiff has not withdrawn its consent, which it may do 
at any time before entry of the proposed Final Judgment by serving 
notice on the defendants and by filing that notice with the Court;
    2. If plaintiff withdraws its consent or the proposed Final 
Judgment is not entered pursuant to this Stipulation, this Stipulation 
shall be of no effect whatever and its making shall be without 
prejudice to any party in this or any other proceeding;
    3. This Stipulation and the Final Judgment to which it relates are 
for settlement purposes only and do not constitute an admission by 
defendants in this or any other proceeding that section 7 of the 
Clayton Act, 15 U.S.C. 18, or any other provision of law, has been 
violated.

    Dated: April 26, 1994.
Anne K. Bingaman,
Assistant Attorney General.
Steven C. Sunshine,
Deputy Assistant Attorney General.
Constance K. Robinson,
Director of Operations.
Richard L. Rosen,
Chief, Communications and Finance Section.
Joe Sims,
Counsel for Defendants, Jones, Day, Reavis & Pogue, Metropolitan Square 
Building.
N. Scott Sacks, Patricia A. Shapiro, Kevin C. Quin, Nancy Dickinson, 
Susannah M. Zwerling,
Counsel for Plaintiff, Antitrust Division, U.S. Department of Justice.

Final Judgment

    Plaintiff, United States of America, filed its Complaint on April 
26, 1994. Plaintiff and Defendants, by their respective attorneys, have 
consented to the entry of this Final Judgment without trial or 
adjudication of any issue of fact or law. This Final Judgment shall not 
be evidence or admission by any party with respect to any issue of fact 
or law. Therefore, before any testimony is taken, and without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is hereby
    Ordered, Adjudged and Decreed:

I

Jurisdiction
    This Court had jurisdiction of the subject matter of this action 
and of each of the parties consenting to this Final Judgment. The 
Complaint states a claim upon which relief may be granted against 
Defendants under section 7 of the Clayton Act, 15 U.S.C. 18.

II

Definitions
    As used in this Final Judgment:
    A. Affiliated means an ownership interest (other than a de minimis 
interest) in, or the right to direct the management decisions of, an 
entity.
    B. Control means (i) the right, contractual or otherwise, to direct 
the management decisions of an entity, or (ii) an ownership interest of 
50% or greater, unless Defendants do not have the right to direct the 
management decisions of such entity.
    C. Financial interest means any economic interest, including, but 
not limited to, any ownership interest or right to any portion of 
current or future revenues.
    D. Multichannel subscription television distributor means a person 
providing multiple channels of video programming to consumers fro which 
a fee is charged, by any of various methods including, but not limited 
to, cable, satellite master antenna television, multichannel multipoint 
distribution, direct-to-home satellite (C-band, Ku-band, or broadcast 
satellite), or the facilities of common carrier telephone companies or 
their affiliates.
    E. Video programming provider means a person engaged in the 
wholesale distribution for sale of video programming.

III

Applicability
    This Final Judgment shall apply to Defendants and each of their 
affiliates, subsidiaries, officers, directors, employees, agents, 
successors, and assigns:

IV

Prohibited Conduct
    A. Defendants are restrained and enjointed, with respect to each 
multichannel subscription television distributor they control, from 
discriminating against any video programming provider not affiliated 
with Defendants in the selection, terms or conditions of carriage of 
video programming offered by such distributors, where the effect of 
such discrimination is to unreasonably restrain competition. Nothing in 
this paragraph is intended to create any automatic right of access for 
any individual video programming provider to any individual 
multichannel subscription television distributor controlled by 
Defendants.
    B. Defendants are restrained and enjoined, with respect to any 
video programming provider they control, from refusing to sell or 
license, or from selling or licensing only on a discriminatory basis, 
any video programming service for distribution by any competing 
multichannel subscription television distributor, where the effect of 
such conduct is to unreasonably restrain competition. Differences in 
price or terms reasonably based on ordinary commercial factors, 
including but not limited to those factors currently set forth in 47 
CFR 76.1002 (b), shall not constitute discrimination.
    C. Defendants are restrained and enjoined, with respect to any 
multichannel subscription television distributor or video programming 
provider in which they have any financial interest but do not control, 
from seeking or supporting any conduct that would be prohibited by (A) 
and (B), above, if engaged in by Defendants.

V

Sanctions
    Nothing in this Final Judgment shall bar the United States from 
seeking, or the Court from imposing, against Defendants or any person 
any relief available under any applicable provision of law.

VI

Plaintiff Access
    A. To determine or secure compliance with this Final Judgment and 
for no other purpose, duly authorized representatives of the Plaintiff 
shall, upon written request of the Assistant Attorney General in charge 
of the Antitrust Division, and on reasonable notice to Defendants, be 
permitted:
    1. Access during Defendants' office hours to inspect and copy all 
records and documents in their possession or control relating to any 
matters contained in this Final Judgment; and
    2. To interview Defendants' officers, employees, trustees, or 
agents, who may have counsel present, regarding such matters. The 
interviews shall be subject to Defendants' reasonable convenience and 
without restraint or interference from Defendants.
    B. Upon the written request of the Assistant Attorney General in 
charge of the Antitrust Division, Defendants shall submit such written 
reports, under oath if requested, relating to any or the matters 
contained in this Final Judgment as may be reasonably requested.
    C. No information or documents obtained by the means provided in 
this section VI shall be divulged by the Plaintiff to any person other 
than a duly authorized representative of the executive branch of the 
United States, except in the course of legal proceeding to which the 
United States is a party, or for the purpose of securing compliance 
with this Final Judgment, or as otherwise required by law.

VII

Further Elements of Decree
    A. This Final Judgment shall expire five years from the date of 
entry.
    B. Jurisdiction is retained by this Court for the purpose of 
enabling any of the parties to this Final Judgment to apply to this 
Court at any time for further orders and directions as may be necessary 
or appropriate to carry out or construe this Final Judgment, to modify 
or terminate any of its provisions, to enforce compliance, and to 
punish violations of its provision. Any party to this Final Judgment 
may seek modification of its substantive terms and obligations, and 
neither the absence of specific reference to a particular event in the 
Final Judgment, nor the foreseeability of such an event at the time 
this Final Judgment was entered, shall preclude this Court's 
consideration of any modification request. The common law applicable to 
modification of final judgments is not otherwise altered.
    C. Entry of this Final Judgment is in the public interest.


----------------------------------------------------------------------
United States District Judge.

Competitive Impact Statement

    Pursuant to section 2(b) of the Antitrust Procedures and Penalties 
Act (``APPA or ``Tunney Act''), 15 U.S.C. 16(b)-(h), the United States 
submits this Competitive Impact Statement relating to the proposed 
Final Judgment submitted for entry with the consent of Tele-
Communications, Inc. and Liberty Media Corp. in this civil antitrust 
proceeding.

I

Nature and Purpose of the Proceeding
    On April 26, 1994, the United States filed a civil antitrust 
complaint, under section 15 of the Clayton Act, as amended, 15 U.S.C. 
25, against Tele-Communications, Inc. (``TCI''), and Liberty Media 
Corporation (``Liberty'') (collectively ``Defendants''), alleging that 
the proposed merger of Defendants violates section 7 of the Clayton 
Act, as amended, 15 U.S.C. 18.
    TCI is the largest cable multiple systems operator (``MSO'') in the 
United States in terms of subscribers, and Liberty is one of the 
largest MSOs. Pursuant to an agreement dated January 27, 1994, TCI and 
Liberty agreed to merge. Combined, TCI and Liberty would have financial 
interests in cable systems accounting for more than 13 million 
subscribers, or approximately one-fourth of the nation's cable 
subscribers. The combined firms would also have substantial financial 
interests in a large number of providers of video programming to 
multichannel subscription television distributors. The Complaint 
alleges that the effect of such combination may be substantially to 
lessen competition in violation of section 7 of the Clayton Act, 15 
U.S.C. 18, by:

    1. Decreasing actual and potential competition among video 
programming providers, because the combined TCI-Liberty may have the 
increased ability and incentive to discriminate with respect to 
access to its cable systems, or the terms and conditions of such 
access, in favor of its affiliated video programming providers and 
against unaffiliated video programming providers.
    2. Decreasing actual and potential competition among 
multichannel subscription television distributors, because the 
combined TCI-Liberty may have the increased ability and incentive to 
deny to competing multichannel subscription television distributors 
access to its affiliated video programming services, or to provide 
such access only on unreasonable terms.

    On April 26, 1994, the United States and Defendants filed a 
Stipulation by which they consented to the entry of a proposed Final 
Judgment designed to eliminate the anticompetitive effects of the 
proposed merger. The proposed Final Judgment, as explained more fully 
below, would enjoin Defendants from discriminating against unaffiliated 
video programmers with respect to access to its cable systems and other 
multichannel subscription television distributors (``MSTDs''), and from 
discriminating against other MSTDs with respect to its programming 
providers, where such discrimination results in an unreasonable 
restraint on competition.
    The United States 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 and enforce the 
Final Judgment, and to punish violations of the Final Judgment.

II

Events Giving Rise to the Alleged Violation
    A. Description of the parties and the proposed transaction. TCI is 
the largest cable multiple systems operator (``MSO'') in the United 
States, with financial and management interests in cable systems 
serving more than 10.2 million subscribers. TCI also has substantial 
interests in direct-to-home satellite delivery of multichannel 
subscription television service, with both a substantial C-band 
satellite business and a partnership interest in Primestar Partners, 
L.P., a Ku-band satellite multichannel subscription television service. 
TCI also has financial and management interests in programming services 
such as The Discovery Channel, The Learning Channel, E! Entertainment 
Television, Request Television (pay-per-view), Home Shopping Network 
Inc., QVC Network Inc., Starz, Rocky Mountain Prime Sports Network, and 
Turner Broadcasting Systems, Inc. (which provides Cable News Network 
(CNN), Headline News, The Cartoon Network, TBS and Turner Network 
Television (TNT)).
    Liberty is a large cable MSO, with financial and management 
interests in cable systems serving 2.9 million subscribers. Liberty 
also has financial and management interests in a wide range of 
programming services, including Black Entertainment Television (BET), 
The Box, Courtroom Television Network, Encore, Starz, Family Channel, 
Home Shopping Network Inc., QVC Network Inc., Prime Sports Network and 
more than a dozen regional sports channels.
    TCI and Liberty intend to merge pursuant to an agreement dated 
January 27, 1994. Together TCI and Liberty will serve more than 13 
million subscribers, or about a quarter of the nation's cable 
subscribers, and have financial interests in a wide range of 
programming services, including a number of the most popular and 
widely-carried services.
    B. Historical relationship between TCI and Liberty. In 1990, TCI 
created Liberty, a new public company, through a rights offering to TCI 
shareholders and moved certain TCI assets into Liberty. According to 
TCI, the new company was created for two reasons. First, the company 
anticipated that possible federal legislation or regulation might force 
such divestiture later under unfavorable circumstances; a voluntary 
separation allowed TCI to retain ties to the new company. Second, in a 
smaller company, management would be able to devote greater attention 
to maximizing the value of Liberty assets and have greater freedom to 
pursue growth opportunities in the cable industry. TCI management also 
felt that capital and financial markets had not given appropriate 
recognition to certain TCI interests and assets, particularly in the 
cable programming area, because they were difficult for security 
analysts and others to identify, value and track; TCI hoped that, in a 
smaller company, the actual and potential value of those interests and 
assets would be appropriately recognized.
    Although Liberty was organized as a separate company, it shared 
stockholders and directors with TCI. Five shareholders maintained 
voting control of both firms, and Bob Magness has simultaneously served 
as Chairman of the Board of TCI and a director of Liberty, and John 
Malone has simultaneously served as President, Chief Executive Officer, 
and a director of TCI and Chairman of the Board of Liberty. TCI 
acknowledges that the two companies have cooperated closely since 
Liberty was formed, and are partners in a number of ventures.
    In 1992, Congress passed the Cable Television Consumer Protection 
and Competition Act, Public Law No. 102-385, 106 Stat. 106 (1992) 
(``1992 Cable Act''), which, combined with implementing FCC regulation, 
established a legal framework regarding, among other things, the number 
of cable subscribers a person is authorized to reach through cable 
systems owned by such person, or in which such person has an 
attributable interest, and delineating the extent to which multichannel 
video programming distributors may engage in the creation or production 
of video programming. TCI claims that the cable system and programming 
assets of TCI and Liberty can be recombined under this regulatory 
framework, and that appropriate market valuation for Liberty's assets 
has been achieved, thus obviating the principal reasons for separating 
the companies. According to TCI the recombination will eliminate 
certain inefficiencies and costs of separation, as well as eliminate 
confusion and conflicts that may have resulted from the separation.
    While not indifferent to the cooperative relationship between the 
firms and the commonality of control in five shareholders and common 
managers and directors, the Department has analyzed the proposed merger 
as a transaction involving two separate entities, since separate legal 
and fiduciary obligations exist for each of the firms that require each 
firm to operate in its distinct interest.
    C. Effects on competition. A multichannel subscription television 
distributor (``MSTD'') is an entity that provides multiple channels of 
video programming to consumers on a subscription or fee basis, as 
differentiated from local broadcast television stations which 
individually provide a single channel at no charge within their 
broadcast areas. MSTDs deliver programming to consumers utilizing 
various methods, including cable, multichannel multipoint distribution 
(``MMDS''), satellite master antenna television (``SMATV''), direct-to-
home satellite, or the facilities of common carrier telephone companies 
or their affiliates.
    The United States filed its complaint because the effects of the 
proposed merger may be substantially to lessen competition (i) among 
providers of video programming to MSTDs in the United States, and (ii) 
among MSTDs in the areas in the United States in which TCI and Liberty 
control cable system.\1\ The merger of TCI and Liberty would result in 
a vertically integrated firm with (1) substantial interests in widely 
distributed and popular video programming and (2) control of 
approximately one-quarter of the nation's cable subscribers. 
Accordingly, the merged firm may have both the ability and incentive to 
lessen competition by discriminating against non-affiliated programmers 
in terms of access to its MSTDs and by denying to competing MSTDs 
access to its video programming on reasonable terms.
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    \1\These product and geographic markets are appropriate markets 
in which to assess the possible competitive effects of this proposed 
merger. Whether or not these markets will be appropriate markets in 
which to analyze other transactions or conduct within the industry 
will, of course, depend on the particular circumstances presented in 
each individual case.
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    The market for multichannel subscription television distribution 
today is overwhelmingly dominated by local cable systems. Cable 
television service is available in nearly all urban ad suburban areas 
in the United States as well as many rural areas, passing more than 95% 
of the nation's estimated 92 million television households. Cable 
television systems currently serve more than 55 million subscribers in 
more than 11,300 cable systems located in all 50 states, or about 60% 
of households passed. Nearly all communities are served by a single 
cable system; fewer than 0.5% of the more than 10,000 cable franchise 
areas have more than one cable system available to local cable 
subscribers. Today, cable television systems face very limited 
competition from other types of distribution systems, including MMDS, 
SMATV, and direct-to-home satellite, and may face competition in the 
future from video dialtone services.
    MMDS delivers programming over microwave channels received by 
subscribers with special antennae. There are currently fewer than 150 
MMDS systems in operation, serving an estimated 600,000 subscribers. 
MMDS has recently obtained regulatory approval to deploy systems that 
are considered technologically superior, which may increase its 
availability and attractiveness as an alternative to cable television 
service.
    SMATV is essentially a private cable system, typically used in 
apartment buildings or other high-density housing. SMATV is estimated 
to have fewer than 1 million subscribers.
    Home satellite dishes are used to receive programming from 
communications satellites. More than two and one-half million satellite 
dishes have been sold in the United States. C-band satellite service, 
which is provided by low-power satellites, requires consumers to 
install satellite receiving dishes eight to twelve feet in diameter at 
an installed cost of $1,500 or more. Because of its high installed cost 
and the size of the receiving dish required, C-band satellite is a poor 
alternative to cable television service for most current or potential 
cable subscribers. Medium-power Ku-band satellite service, provided by 
TCI and its partners in a joint venture called Primestar Partners, 
L.P., uses dishes three feet in diameter and has approximately 70,000 
subscribers. High-power DBS is expected to become operational and 
available within a few months using a dish 18 inches in diameter, and 
may by virtue of its smaller dish size be more attractive to consumers 
so that it ultimately may offer greater competition to cable service 
than the other satellite services.
    Video dialtone is a multichannel subscription television service 
recently authorized by Federal Communications Commission regulation and 
being developed by common carrier telephone companies. Using the 
telephone network, telephone companies plan to offer distribution of 
programming provided by third parties. As the telephone companies 
improve the capabilities and capacity of their networks, they are 
expected to be able to offer greatly expanded channel capacity and 
services such as ``video-on-demand.'' At present, there are a small 
number of pilot projects demonstrating the service. Widespread 
development of video dialtone services in the future may present a 
substantial competitor to cable systems. Common carrier telephone 
companies also have announced their interest in providing cable service 
directly to subscribers in the event that legal restrictions on their 
offering such services within their operating regions are removed.
    As discussed above, both TCI and Liberty, in addition to operating 
cable systems, each have substantial financial interests in video 
programming services provided to cable systems and other MSTDs. The 
merger of TCI and Liberty creates a vertically integrated firm with 
substantial power both as a MSTD and as a video programming provider. 
TCI and Liberty together will effectively control access to about one-
fourth of cable subscribers and will be affiliated with eight of the 
twenty most widely distributed cable programming services. This 
substantial integration is likely to increase abilities and incentives 
to restrain competition in two ways. First, the merged firm could 
discriminate against competitive video programmers in favor of its 
affiliated programmers by refusing to carry programs or by denying 
similar terms or conditions thereby making it significantly more 
difficult for such competitive programmers to operate profitably or to 
compete effectively against the merged firm's programming services. 
Second, the merged firm could deny access to or discriminate in terms 
of access to its programming to competing MSTDs, making it more 
difficult for competitive distribution systems to obtain programming 
necessary to compete effectively against the merged firm's MSTDs.

III

Explanation of the Proposed Final Judgment
    The United States and the defendants have stipulated that the Court 
may enter the proposed Final Judgment after compliance with the APPA. 
The stipulation provides that entry of the Final Judgment does not 
constitute any evidence or admission by any party with respect to any 
issue of fact or law. Under the provisions of the APPA, the proposed 
Final Judgment may not be entered unless the Court finds that entry is 
in the public interest. The Department believes that the proposed Final 
Judgment provides an adequate remedy for the alleged violation and is 
in the public interest. The term of the proposed Final Judgment is five 
(5) years. The length of this term reflects the Department's 
recognition that this industry is one that has experienced major 
changes in MSTD technologies that are on-going, and the effects of the 
1992 Cable Act and its implementing FCC regulations.
    Section IV(A) of the proposed Final Judgment enjoins Defendants' 
cable systems and other MSTDs from discriminating against non-
affiliated video programmers in the selection, terms, or conditions, 
where the effect of such conduct is unreasonably to restrain 
competition. This provision does not create an automatic right of 
access for any individual video programmer to any of Defendants' 
individual MSTDs, nor is it intended to inhibit good faith negotiations 
between Defendants and unaffiliated programmers regarding the terms and 
conditions of carriage. However, where the effect of discrimination by 
Defendants is to restrain competition, such conduct is prohibited. 
Discriminatory conduct can take a variety of forms depending on 
individual circumstances, and may include, but is not limited to, 
discrimination in: (i) Pricing; (ii) channel assignment; (iii) tiering 
or packaging of programming services; (iv) promotional activities; and 
(v) signal quality.
    By section IV(B), Defendants are enjoined from refusing to sell or 
license, or from selling or licensing only on a discriminatory basis, 
video programming in which they have an interest to any competing MSTD, 
where the effect of such conduct is unreasonably to restrain 
competition. Differences in price or terms that are reasonably based on 
ordinary commercial factors, including but not limited to the factors 
currently set forth in 47 CFR 76.1002(b), will not constitute 
prohibited discrimination. This section therefore does not prevent 
defendants from engaging in good faith business negotiations or from 
imposing reasonable requirements for the creditworthiness or service 
quality of a distributor, or from establishing prices, terms, and 
conditions that reasonably reflect actual differences in the 
distributor's costs of providing such video programming or economies of 
scale or other economic benefits reasonably attributable to the number 
of subscribers served by such distributor. This provision does assure 
that Defendants may not refuse to license their video programming to 
competing MSTDs where the effect would be to inhibit the ability of 
such MSTDs to compete against Defendants.
    Section IV(C) extends the prohibitions set forth in sections IV (A) 
and (B) to prevent Defendants from seeking or supporting, with respect 
to any MSTD or video programming provider in which Defendants have any 
financial interest but do not control, conduct that would violate 
sections IV (A) or (B) if engaged in by Defendants. For example, should 
Defendants urge Turner Broadcasting, Inc. to deny programming to a 
competing MSTD under circumstances that would result in an unreasonable 
restraint on competition, such conduct by Defendants would violate this 
section.
    By prohibiting conduct by Defendants that might restrain 
competition in the provision of video programming or multichannel 
subscription television distribution, the Department believes that the 
anticompetitive effects of the proposed merger alleged in the Complaint 
will be fully remedied. In addition, by expressly including common 
carrier telephone companies and their video dialtone customers in the 
definition of MSTDs, the proposed Final Judgment will make clear the 
defendants' obligation to refrain from anticompetitive discrimination 
against these potential competitors. The Department's view as to the 
sufficiency of this relief also rests on the existence of sections 12 
and 19 of the 1992 Cable Act, and their implementing FCC regulations, 
as well as the judgments recently entered in U.S. v. Primestar 
Partners, L.P., et al.\2\ and State of New York, et al. v. Primestar 
Partners, L.P., et al.\3\ (``Primestar cases'').
---------------------------------------------------------------------------

    \2\No. 93 Civ. 3913 (S.D.N.Y. April 4, 1994).
    \3\1993-2 Trade Cas. (CCH) 70,403-4 (S.D.N.Y. Sept. 14, 1993).
---------------------------------------------------------------------------

IV

Remedies Available to Potential Litigants
    Section 4 of the Clayton Act, 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 will neither impair nor 
assist the bringing of any private antitrust actions under the Clayton 
Act. 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 
private lawsuit that may be brought against the defendants.

V

Procedures Available for Modification of the Proposed Final Judgment
    As provided by the APPA, any person believing that the proposed 
Final Judgment should be modified may submit written comments within 
the sixty (60) day period from the date of publication in the Federal 
Register to Richard L. Rosen, Chief, Communications and Finance 
Section, Antitrust Division, U.S. Department of Justice, 555 Fourth 
Street, NW., room 8104, Washington, DC 20001. These comments, and the 
Department's responses, will be filed with the Court and published in 
the Federal Register. All comments will be given due consideration by 
the Department of Justice, which remains free to withdraw its consent 
at any time prior to entry. The proposed Final Judgment provides that 
the Court retains jurisdiction over these actions, and any party may 
apply to the Court for any order necessary or appropriate for their 
modification, interpretation or enforcement.

VI

Alternatives To the Proposed Final Judgment
    The United States considered, as an alternative to the proposed 
Final Judgment, litigation to enjoin the merger. The United States 
rejected that alternative because the relief in the proposed Final 
Judgment should prevent the possible occurrence of conduct the effect 
of which may be substantially to lessen competition in the provision of 
video programming to MSTDs in the United States or competition among 
MSTDs in the geographic areas in which Defendants have cable systems. 
Moreover, the terms of the proposed Final Judgment are supplemented by 
the provisions of the 1992 Cable Act and its implementing FCC 
regulations, as well as the judgments in the Primestar cases. Under 
these circumstances, seeking to enjoin the merger would only prevent 
the two firms from achieving the economic efficiencies that may result 
from vertical integration and, given their history and present 
circumstances, eliminating the cost imposed by their legal separation 
into separate firms.

VII

Determinative Documents
    No documents were determinative in the formulation of the proposed 
Final Judgment. Consequently, the United States has not attached any 
such document to the proposed Final Judgment.
N. Scott Sacks, Patricia A. Shapiro, Kevin C. Quin, Nancy Dickinson, 
Susanna M. Zwerling,
Trial Attorneys, Antitrust Division, U.S. Department of Justice.
[FR Doc. 94-11572 Filed 5-11-94; 8:45 am]
BILLING CODE 4410-01-M