[Federal Register Volume 59, Number 184 (Friday, September 23, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-23411]


[[Page Unknown]]

[Federal Register: September 23, 1994]


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DEPARTMENT OF JUSTICE

Antitrust Division

 

U.S. v. Outdoor Systems, Inc.; Proposed Final Judgment and 
Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation and Competitive Impact Statement have been filed with the 
United States District Court for the Northern District of Georgia in 
United States of America v. Outdoor Systems, Inc., Civil No. P1-94-CV-
2393-CC.
    The Complaint alleges that the proposed acquisition by Outdoor 
Systems, Inc. of the outdoor advertising business of Capitol Outdoor 
Advertising, Inc. may be substantially to lessen competition in outdoor 
advertising in the Atlanta area in violation of section 7 of the 
Clayton Act.
    The Proposed Final Judgment provides that Outdoor Systems, Inc. may 
acquire the outdoor advertising business of Capitol Outdoor 
Advertising, Inc. but that Outdoor Systems, Inc. must divest the assets 
of its existing outdoor advertising business in the Atlanta area within 
six months of the entry of the Final Judgment.
    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 John T. Orr, Chief, Atlanta Field 
Office, Antitrust Division, Department of Justice, Suite 1176, Richard 
B. Russell Federal Building, 75 Spring Street, Atlanta, Georgia 30303 
(telephone: (404) 331-7100).
Constance K. Robinson,
Director of Operations, Antitrust Division.

United States District Court, Northern District of Georgia, Atlanta 
Division

    United States of America, Plaintiff, v. Outdoor Systems, Inc., 
Defendant. Civil No. 94-      . Filed: September 8, 1994.

Stipulation

    It is stipulated by and between the undersigned parties, by their 
respective attorneys, that:
    1. This Court has jurisdiction over the subject matter of this 
action and over each of the parties hereto, and venue of this action is 
proper in the United States District Court for the Northern District of 
Georgia, Atlanta Division;
    2. 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), and 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 defendant and by filing that notice with the 
Court;
    3. Defendant agrees to be bound by the provisions of the proposed 
Final Judgment pending its approval by the Court. 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; and
    4. This Stipulation and the Final Judgment to which it relates are 
for settlement purposes only and do not constitute an admission by 
defendant 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:
Anne K. Bingaman,
Assistant Attorney General.
Steven C. Sunshine,
Deputy Assistant Attorney General.
Constance K. Robinson
Director of Operations.
John T. Orr,
Chief, Atlanta Field Office, U.S. Department of Justice, Antitrust 
Division.
Mark W. Ryan by David H. Fin
With express authorization Schreeder, Wheeler & Flint, 1600 Candler 
Bldg, Atlanta, GA 30303-1845, 404-681-3450, GA. Bar, No. 264600.
Mark W. Ryan,
Counsel For defendant.
Mayer, Brown & Platt, 2000 Pennsylvania Avenue NW., Washington, D.C. 
20006, (202) 778-0627.
Justin M. Nicholson,
William G. Traynor
Attorneys, Antitrust Division, U.S. Department of Justice, Richard B. 
Russell Building, 75 Spring Street, SW., Suite 1176, Atlanta, Georgia 
30303, (404) 331-7100.

United States District Court, Northern District of Georgia, Atlanta 
Division

    United States of America, Plaintiff, v. Outdoor Systems, Inc., 
Defendant. Civil No. 94-      . Filed: September 8, 1994.

Final Judgment

    Plaintiff, United States of America, filed its Complaint on 
September 8, 1994. Plaintiff and defendant, 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 constitute any evidence against, or an admission by, any 
party with respect to any issue of law or fact. Defendant has agreed to 
be bound by the provisions of this Final Judgment pending its approval 
by the Court. Prompt and certain diverstiture is the essence of this 
agreement, and defendant has represented to plaintiff that the 
diverstiture required below can and will be made and that defendant 
will later raise no claims of hardship or difficulty as grounds for 
asking the Court to modify any of the divestiture provisions contained 
below. Therefore, before the taking of any testimony, 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 as follows:

I

Jurisdiction

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

II

Definitions

    As used in this Final Judgment:
    A. ``Capitol'' shall mean Capitol Outdoor Advertising, Inc., 
Capitol Outdoor Leasing Co., Inc., each of their subsidiaries and 
affiliates and each officer, director, employee, attorney, agent or 
other person acting for or on behalf of any of them. Such term shall 
also mean the entity owned by defendant that acquires the assets of 
Capitol Outdoor Advertising, Inc. and Capitol Outdoor Leasing Co., 
Inc.;
    B. ``OSI-Atlanta'' shall mean the entity conducting the outdoor 
advertising business of Outdoor Systems, Inc. as of the date of the 
entry of this Final Judgment, or any successor entity, in the greater 
Atlanta, Georgia metropolitan area, each of their subsidiaries and 
affiliates and each officer, director, employee, attorney, agent or 
other person acting for or on behalf of any of them;
    C. ``Holding Company'' or ``defendant'' shall mean defendant 
Outdoor Systems, Inc., each of its subsidiaries and affiliates and each 
officer, director, employee, attorney, agent or other person acting for 
or on behalf of any of them;
    D. ``Separated Assets'' shall mean (1) all of the outdoor 
advertising billboards (including bulletins and poster panels), 
structures and leases of OSI-Atlanta, (2) all contracts, including but 
not limited to advertising contracts, agreements, invoices, ledgers and 
other books and records relating to the business of OSI-Atlanta and (3) 
such equipment currently owned or operated by Capitol as the purchaser 
may select that would provide the purchaser with the functional 
equivalent of the equipment owned or operated by OSI-Atlanta;
    E. ``Separated Business'' shall mean Capitol or OSI-Atlanta, as the 
case may be;
    F. ``Purchaser'' shall mean an independent third party, not 
connected or affiliated in any way with Capitol, OSI-Atlanta or Holding 
Company, that acquires the Separated Assets; and
    G. ``Person'' shall mean any natural person, corporation, 
association, firm, partnership or other business or legal entity.

III

Applicability

    A. The provisions of this Final Judgment shall apply to defendant, 
to its successors and assigns, to its subsidiaries, affiliates, 
directors, officers, managers, agents and employees and to all other 
persons in active concert or participation with any of them who shall 
have received actual notice of this Final Judgment by personal service 
or otherwise.
    B. Nothing herein shall suggest that any portion of this Final 
Judgment is or has been created for the benefit of any third party, and 
nothing herein shall be construed to provide any rights to any third 
party.

IV

Divestiture of OSI-Atlanta

    A. Defendant is hereby ordered and directed to divest all of its 
direct and indirect ownership and control of the Separated Assets to a 
purchaser within six (6) months of the entry of this Final Judgment. In 
addition, defendant shall offer to any purchaser of the Separated 
Assets the opportunity, which may be exercised in the purchaser's sole 
and absolute discretion, (1) To make offers of employment to all or any 
of the employees currently employed by Capitol and (2) to assume the 
lease of the facility now operated by Capitol in the conduct of its 
outdoor advertising business. The obligation to divest shall be 
satisfied if, within six (6) months of the entry of this Final 
Judgment, defendant has entered into a binding contract with a 
qualified purchaser for the sale of the Separated Assets according to 
terms approved by plaintiff that are contingent upon compliance with 
the terms of this Final Judgment and that specify a prompt and 
reasonable date for the closing and if the sale is completed pursuant 
to the contract.
    B. Defendant agrees to take all reasonable steps to accomplish the 
divestiture as quickly as possible. In carrying out the divestiture of 
the Separated Assets, defendant may divest the Separated Assets alone, 
or may divest along with the Separated Assets any other assets of 
defendant.
    C. In accomplishing the divestiture ordered by this Final Judgment, 
defendant promptly shall make known, by usual and customary means, the 
availability of the Separated Assets for sale and the opportunities 
described in Paragraph IV.A. above. Defendant shall notify any person 
making an inquiry regarding the possible purchase of the Separated 
Assets that the sale is being made pursuant to this Final Judgment and 
provide such person with a copy of the Final Judgment, if requested. 
Defendant shall also offer to furnish to all bona fide prospective 
purchasers of the Separated Assets, subject to customary 
confidentiality assurances, all pertinent information regarding OSI-
Atlanta, except information subject to attorney-client privilege or 
attorney work product privilege. Defendant shall make available to 
plaintiff, upon plaintiff's request, such information as is made 
available to such potential purchasers. Defendant shall permit 
prospective purchasers of the Separated Assets to have access to 
personnel at the business and to make such inspection of physical 
facilities and any and all financial, operational, or other documents 
and information as may be relevant and customary to the sale of an 
outdoor advertising business.
    D. The divestiture required by this Final Judgment shall be 
accomplished in such a way as to satisfy plaintiff, in its sole 
discretion, that the Separated Assets can and will be operated by the 
purchaser as a viable, ongoing business. Divestiture shall be made to a 
purchaser for whom it is demonstrated to plaintiff's satisfaction that 
(1) The purchase is for the purpose of competing effectively in the 
outdoor advertising business in the greater Atlanta, Georgia 
metropolitan area, and (2) the purchaser has the managerial, 
operational, and financial capability to compete effectively in the 
outdoor advertising business.

V

Financing

    With prior consent of plaintiff, defendant may finance all or any 
part of any purchase made pursuant to this Final Judgment.

VI

Appointment of Trustee for OSI-Atlanta

    A. If defendant has not accomplished the divestiture required by 
Section IV. of this Final Judgment within five (5) months of the entry 
of this Final Judgment, then defendant shall notify plaintiff of that 
fact. Within ten (10) days after notification, plaintiff shall provide 
defendant with written notice of the names and qualifications of not 
more than two (2) nominees for the position of trustee for the required 
divestiture. Defendant shall notify plaintiff within ten (10) days 
thereafter whether either or both of such nominees are acceptable. If 
either or both of such nominees are acceptable to defendant, plaintiff 
shall notify the Court of the person upon whom the parties have agreed 
and the Court shall appoint that person as the trustee. If neither of 
such nominees is acceptable to defendant, it shall furnish to 
plaintiff, within ten (10) days after plaintiff provides the names of 
its nominees, written notice of the names and qualifications of not 
more than two (2) nominees for the position of trustee for the required 
divestiture. If either or both of such nominees are acceptable to 
plaintiff, plaintiff shall notify the Court of the person upon whom the 
parties have agreed and the Court shall appoint that person as the 
trustee. If neither of such nominees is acceptable to plaintiff, it 
shall furnish the Court the names and qualifications of its proposed 
nominess and the names and qualifications of the nominees proposed by 
defendant. The Court may hear the parties as to the qualifications of 
the nominees and shall appoint one of the nominees as the trustee.
    B. If defendant has not accomplished the required divestiture at 
the expiration of the period specified in paragraph IV.A. of this Final 
Judgment, the appointment by the Court of the trustee shall become 
effective. The trustee shall then take steps to effect divestiture of 
the Separated Assets.
    C. After the trustee's appointment has become effective, only the 
trustee shall have the right to sell the Separated Assets and to offer 
any prospective purchasers the same opportunities as defendant is 
obligated to extend as provided in paragraph IV.A. The trustee shall 
have the power and authority to accomplish the divestiture to a 
purchaser acceptable to plaintiff at such price and on such terms as 
are then obtainable upon a reasonable effort by the trustee, subject to 
the provisions of paragraph IX.A. of this Final Judgment, and shall 
have such other powers as this Court shall deem appropriate. Defendant 
shall not object to a sale of the Separated Assets by the trustee on 
any grounds other than the trustee's malfeasance. Any such objection by 
defendant must be conveyed in writing to plaintiff and the trustee 
within fifteen (15) days after the trustee has notified defendant of 
the proposed sale.
    D. The trustee shall serve at the cost and expense of defendant, 
shall receive compensation based on a fee arrangement providing an 
incentive based on the price and terms of the divestiture and the speed 
with which it is accomplished and shall serve on such other terms and 
conditions as the Court may prescribe; provided, however, that the 
trustee shall receive no compensation, nor incur any costs or expenses, 
prior to the effective date of his or her appointment. The trustee 
shall account for all monies derived from a sale of the Separated 
Assets and all costs and expenses incurred in connection therewith. 
After approval by the Court of the trustee's accounting, including fees 
for the trustee's services, all remaining monies shall be paid to 
defendant and the trust shall then be terminated.
    E. Defendant shall take no action to interfere with or impede the 
trustee's accomplishment of the divestiture of the Separated Assets and 
shall use its best efforts to assist the trustee in accomplishing the 
required divestiture. The trustee shall have full and complete access 
to the personnel, books, records and facilities of OSI-Atlanta.
    F. After his or her appointment becomes effective, the trustee 
shall file monthly reports with the parties and the Court setting forth 
the trustee's efforts to accomplish divestiture of the Separated Assets 
as contemplated under this Final Judgment; provided, however, that to 
the extent such reports contain information that the trustee deems 
confidential, such reports shall not be filed in the public docket of 
the Court. Such reports shall include the name, address and telephone 
number of each person who, during the preceding thirty (30) days, made 
an offer to acquire, expressed an interest in acquiring, entered into 
negotiations to acquire or was contacted or made an inquiry about 
acquiring any ownership interest in the Separated Assets, and shall 
describe in detail each contact with any such person during that 
period. The trustee shall maintain full records of all efforts made to 
divest these operations.
    G. Within six (6) months after his or her appointment has become 
effective, if the trustee has not accomplished the divestiture required 
by this Final Judgment, the trustee shall promptly file with the Court 
a report setting forth (1) the trustee's efforts to accomplish the 
required divestiture, (2) the reasons, in the trustee's judgment, why 
the required divestiture has not been accomplished and (3) the 
trustee's recommendations; provided, however, that to the extent such 
reports contain information that the trustee deems confidential, such 
reports shall not be filed in the public docket of the Court. The 
trustee shall at the same time furnish such report to the parties, who 
shall each have the right to be heard and to make additional 
recommendations consistent with the purpose of the trust. The Court 
shall thereafter enter such orders as it shall deem appropriate in 
order to carry out the purpose of the trust, which shall, if necessary, 
include extending the trust and the term of the trustee's appointment.

VII

Notification

    Immediately following entry of a binding contract, contingent upon 
compliance with the terms of this Final Judgment, to effect the 
proposed divestiture pursuant to Section IV. or VI. of this Final 
Judgment, defendant or the trustee, whichever is then responsible for 
effecting the divestiture, shall notify plaintiff of the proposed 
divestiture. If the trustee is responsible, it shall similarly notify 
defendant. The notice shall set forth the details of the proposed 
transaction and list the name, address and telephone number of each 
person not previously identified who offered to, or expressed an 
interest in the business that is the subject of the binding contract, 
together with full details of same. Within fifteen (15) days of receipt 
by plaintiff of such notice, plaintiff may request additional 
information concerning the proposed divestiture and the proposed 
purchaser. Defendant and/or the trustee shall furnish any additional 
information requested within twenty (20) days of the receipt of the 
request, unless the parties shall otherwise agree. Within thirty (30) 
days after receipt of the notice or within twenty (20) days after 
plaintiff has been provided the additional information requested 
(excluding any additional information requested of persons other than 
defendant or the trustee), whichever is later, plaintiff shall provide 
written notice to defendant and the trustee, if there is one, stating 
whether or not it objects to the proposed divestiture. If plaintiff 
provides written notice to defendant or the trustee that it does not 
object, then the divestiture may be consummated, subject only to 
defendant's limited right to object to the sale under the provisions in 
Section VI.C. Absent written notice that the plaintiff does not object 
to the proposed purchaser, a divestiture under Section IV. shall not be 
consummated. Upon objection by plaintiff, or by defendant under the 
proviso in Section IV.C., a divestiture proposed under Section VI. 
shall not be consummated.

VIII

Affidavits

    Upon filing of this Final Judgment and every thirty (30) days 
thereafter until the divestiture has been completed or authority to 
effect divestiture passes to the trustee pursuant to Section VI. of 
this Final Judgment, defendant shall deliver to plaintiff an affidavit 
as to the fact and manner of compliance with Section IV. of this Final 
Judgment. Each such affidavit shall include the name, address and 
telephone number of each person who, at any time after the period 
covered by the last such report, made an offer to acquire, expressed an 
interest in acquiring, entered into negotiations to acquire or was 
contacted or made an inquiry about acquiring any ownership interest in 
the Separated Assets and shall describe in detail each contact with any 
such person during that period. Defendant shall maintain full records 
of all efforts made to divest the Separated Assets.

IX

Preservation of Assets

    A. The Holding Company shall be created and take all steps 
necessary to assure that Capitol and OSI-Atlanta will be maintained as 
separate, independent and economically viable, ongoing businesses with 
their assets, management and operations separate, distinct and apart 
from one another. Without limitation of the foregoing, the Holding 
Company and the Separated Businesses shall comply with the following 
provisions during the pendency of this Final Judgment:
    1. The Holding Company and the Separated Businesses shall refrain 
from causing or permitting any commingling of the assets of one 
Separated Business with those of the other Separated Business; 
provided, however, that financial statements may be consolidated at the 
Holding Company, subject to the accounting provisions set forth herein.
    2. The Holding Company and the Separated Businesses shall assure 
that neither Separated Business, nor any of its directors, officers, 
employees or agents, influences or attempts to influence, directly or 
indirectly, any operational, marketing or financial decisions of the 
other Separated Business.
    3. a. Within five (5) days of the entry of this Final Judgment, the 
Holding Company shall establish a Sales Committee (``Holding Company 
Sales Committee''), consisting of not less than two (2) members of the 
current Board of Directors of the Holding Company, or their designees, 
who are not involved in the management of the Holding Company or of 
either of the Separated Businesses.
    b. The Holding Company shall designate an ``Operating President'' 
for each of OSI-Atlanta and Capitol and said Operating Presidents shall 
serve in those capacities for the respective Separated Businesses until 
the divestiture required by this Final Judgment shall have been 
accomplished.
    c. Without limiting his or her other responsibilities, each 
Operating President shall be responsible to supervise and assist in the 
respective Separated Business's outdoor advertising businesses and 
shall exercise such authority and responsibilities without consulting 
with any officer, director or employee of the other Separated Business 
regarding the terms and conditions of the operation of the other 
Separated Business.
    d. Insofar as any contract or proposal of either Separated Business 
shall entail actions that would otherwise require approval by either 
the Chief Executive Officer or Board of Directors of the Holding 
Company, the Operating President of the Separated Business shall report 
the proposal to the Holding Company Sales Committee for its 
consideration and any requisite action. With respect to matters that 
are brought to it pursuant to the terms of this subsection, the Holding 
Company Sales Committee shall be authorized to bind the Holding 
Company.
    e. Insofar as either Separated Business anticipates a need to 
exceed the amounts provided in its annual budget for capital 
expenditures, authority for such additional expenditures shall be 
sought and first obtained by the Operating President of the Separated 
Business from the Holding Company Sales Committee.
    4. Except as expressly allowed by the terms of this Final Judgment, 
neither Separated Business, nor any of its directors, officers, 
employees or agents, shall provide to the other Separated Business, or 
any director, officer, employee or agent of the other Separated 
Business, any competitively sensitive information, including but not 
limited to actual or proposed prices, costs, bids, contract terms, 
financial data or profit data (other than aggregated monthly or 
quarterly results provided to the Board of Directors of the Holding 
Company). The Holding Company and the independent accounting firm 
referred to in this Final Judgment shall not provide any competitively 
sensitive information relating to one Separated Business to any 
director, officer or employee of the other Separated Business.
    5. Except as authorized by the terms of this Final Judgment, 
Capitol and OSI-Atlanta shall not permit the use of the other's 
trademarks or otherwise identify the relationship of these Separated 
Businesses in their advertising, sales or promotional materials. In 
dealing with third parties, the Separated Business shall indicate and 
make clear that the Separated Businesses are being operated as discrete 
and separate business entities during the pendency of this Final 
Judgment.
    6. Each Separated Business shall compete with the other Separated 
Business in the same fashion as it competes with other outdoor 
advertising businesses in the greater Atlanta, Georgia metropolitan 
area.
    7. Each Separated Business shall keep and maintain in accordance 
with generally accepted accounting principles, separate financial 
statements and records, including separate unaudited monthly and 
quarterly financial statements. Additionally, the Holding Company shall 
assure that an independent certified public accountant shall prepare 
certified annual financial statements for each Separated Business.
    8. Paragraph IX.E. of this Final Judgment shall not preclude Arte 
Moreno from performing the following functions in his capacity as the 
Chief Operating Officer of the Holding Company:
    a. Participating in decisions regarding the management of the cash 
and short-term assets of the Holding Company and the Separated 
Businesses, subject to all of the explicit limitations contained in 
this Final Judgment;
    b. Participating in decisions regarding the deployment of existing 
equipment of either Separated Business in servicing contracts that have 
been awarded to that Separated Business;
    c. Participating in decisions regarding the employment and 
redeployment of staff and administrative personnel within each 
Separated Business, as well as all personnel at the Holding Company 
level; and
    d. Participating in decisions regarding employee compensation and 
employee benefits within the Holding Company.
    B. The Holding Company and the Separated Businesses shall refrain 
from taking any action that would jeopardize the sale or operation of 
either Separated Business or would otherwise adversely affect the 
capability of either Separated Business to compete effectively in the 
sale of outdoor advertising, including but not limited to the 
following:
    1. The Holding Company and the Separated Businesses shall refrain 
from taking any action, directly or indirectly, that would cause any 
material adverse change or alteration to be made in the operations of 
each Separated Business that would impair the ability of the Holding 
Company to sell or dispose of such Separated Business;
    2. Except as incident to obtaining financing or refinancing of the 
transaction pursuant to which the Holding Company acquired Capitol, the 
Holding Company and each Separated Business shall refrain from 
disposing of, mortgaging, pledging or otherwise encumbering any of the 
assets of the Separated Businesses, other than in the ordinary course 
of business of the Holding Company or the respective Separated 
Businesses; and
    3. Upon the entry of this Final Judgment, the Holding Company may 
move current employees of OSI-Atlanta a Capitol, but each employee 
moved from OSI-Atlanta to Capitol must be replaced at OSI-Atlanta by an 
employee of similar job description and experience. Replacement 
employees may come from Capitol.
    C. Each Separated Business shall maintain, in accordance with usual 
industry standards, all outdoor advertising structures owned or 
operated by it.
    D. The Separated Businesses shall have such outside financing for 
capital improvements and working capital available as is consistent 
with their budgets and past practices. Holding Company shall provide, 
consistent with the budgets established for the respective Separated 
Businesses prior to the date of this Final Judgment, funds for 
necessary capital improvements.
    E. No director, officer or employee of one Separated Business shall 
also serve as a director, officer or employee of the other Separated 
Business. To the extent any director, officer or employee of the 
Holding Company is also a director, officer or employee of a Separated 
Business, that person may not receive any competitively sensitive 
information provided to the Board of Directors of the Holding Company 
by the other Separated Business.

X

Modifications

    To the extent that either party later determines that modifications 
of this Final Judgment are necessary or appropriate, the parties shall 
first discuss any such proposed modifications among themselves, and 
shall present to the Court any such proposed modifications on which 
they agree in a form that they recommend the Court approve. In the 
event the parties cannot agree on any such modifications, either party 
may file a motion to the Court seeking a modification of this Final 
Judgment only after having provided the other party fifteen days' 
advance written notice of intention to seek such modification.

XI

Compliance Inspection

    A. For purposes of determining or securing compliance with this 
Final Judgment and subject to any legally recognized privilege, from 
time to time, duly authorized representatives of the Department of 
Justice shall, upon written request of the Assistant Attorney General 
in charge of the Antitrust Division, and on reasonable notice to 
defendant made to its principal office, be permitted:
    1. access during office hours of defendant to inspect and copy all 
books, ledgers, accounts, correspondence, memoranda and other records 
and documents in the possession or under the control of defendant, who 
may have counsel present, relating to any matters contained in this 
Final Judgment; and
    2. subject to the reasonable convenience of defendant and without 
restraint or interference from it to interview officers, employees and 
agents of defendant, who may have counsel present, regarding any such 
matters.
    B. Upon the written request of the Assistant Attorney General in 
charge of the Antitrust Division made to defendant's principal office, 
defendant shall submit such written reports, under oath if requested, 
with respect to any of the matters contained in this Final Judgment as 
may be requested.
    C. No information or documents obtained by the means provided in 
this Section XI shall be divulged by a representative of the Department 
of Justice to any person other than a duly authorized representative of 
the Executive Branch of the United States, except in the course of 
legal proceedings to which the United States is a party (including 
grand jury proceedings), or for the purpose of securing compliance with 
this Final Judgment, or as otherwise required by law.
    D. If at the time information or documents are furnished by 
defendant to plaintiff, defendant represents and identifies in writing 
the material in any such information or documents to which a claim of 
protection may be asserted under Rule 26(c)(7) of the Federal Rules of 
Civil Procedures, and defendant marks each pertinent page of such 
material, ``Subject to claim of protection under Rule 26(c)(7) of the 
Federal Rules of Civil Procedure,'' governing protection of trade 
secrets and confidential commercial information, then ten days notice 
shall be given by plaintiff to defendant prior to divulging such 
material in any legal proceeding (other than a grand jury proceeding ).

XII

Retention of Jurisdiction

    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 such further orders and directions as may be necessary or 
appropriate for the construction or carrying out of this Final 
Judgment, for the modification of any of the provisions hereof, for the 
enforcement of compliance herewith, and for the punishment of any 
violations hereof.

XIII

Termination

    This Final Judgment will expire upon consummation of the 
divestiture of the Separated Assets in accordance with the terms 
herein.

XIV

Public Interest

    Entry of this Final Judgment is in the public interest.

    So ordered.

----------------------------------------------------------------------
United States District Judge, Northern District of Georgia.

    Dated:

United States District Court, Northern District of Georgia, Atlanta 
Division

    United States of America, Plaintiff, v. Outdoor Systems, Inc., 
Defendant. Civil No. 1-94-CV-2393-CC, Filed: September 8, 1994.

Competitive Impact Statement

    Pursuant to Section 2(b) of the Antitrust Procedures and Penalties 
Act (``APPA''), 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 Outdoor Services, Inc., in this 
civil antitrust proceeding.

I

Nature and Purpose of the Proceeding

    On September 8, 1994, the United States filed a civil antitrust 
complaint, under Section 15 of the Clayton Act, 15 U.S.C. 25, against 
Outdoor Services, Inc., alleging that the proposed acquisition by 
Outdoor Services, Inc. (``OSI'') of the outdoor advertising business of 
Capitol Outdoor Advertising, Inc. (``Capitol'') would violate Section 7 
of the Clayton Act, 15 U.S.C. 18. The Complaint alleges that the effect 
of the merger may be substantially to lessen competition in outdoor 
advertising in the Atlanta area. The Complaint seeks, among other 
relief, a permanent injunction preventing defendant from combining its 
outdoor advertising business with that of Capitol.
    Also on September 8, 1994, the United States and OSI filed a 
Stipulation by which they consented to the entry of a proposed Final 
Judgment designed to preserve competition in the outdoor advertising 
business in the Atlanta area. The proposed Final Judgment, as explained 
more fully below, would allow OSI to acquire the outdoor advertising 
business of Capitol but orders OSI to divest its own outdoor 
advertising business in the Atlanta area within six months. The Final 
Judgment also provides that pending the sale of OSI's outdoor 
advertising business, a holding company will be established to hold 
separate the businesses of OSI and Capitol.
    The United States and OSI 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

Background to the Alleged Violation

    On or about July 27, 1994, OSI and Capitol entered into a purchase 
agreement under which the two companies would merge and OSI would 
become the sole surviving entity. This acquisition would, if 
unchallenged, effectively merge all of the business of OSI and Capitol. 
The purchase price was approximately $40 million.
    OSI is a corporation organized and existing under the laws of the 
State of Delaware. It maintains its principal offices at 2502 North 
Black Canyon Highway, Phoenix, Arizona. OSI is in the business of 
providing outdoor advertising services in the Atlanta area. OSI's 
Atlanta area office is located at 3745 Atlanta Industrial Drive, N.W., 
Atlanta, Georgia. OSI had outdoor advertising revenues in the Atlanta 
area of about $7.4 million in 1993.
    Capitol is a corporation organized and existing under the laws of 
the State of Delaware. It maintains its principal offices at 732 Ashby 
Street, N.W., Atlanta, Georgia. Capitol is in the business of providing 
outdoor advertising services in the Atlanta area. Capitol had outdoor 
advertising revenues in the Atlanta area of about $17.1 million in 
1992.
    The Complaint alleges that OSI and Capital are significant 
competitors in the outdoor advertising market in the Atlanta area. 
Outdoor advertising is another name given to standardized billboard 
advertising in the United States. There are several types of 
billboards. The largest type of billboard is the ``bulletin,'' which 
comes in two standard sizes, 14' tall by 48' long, or 20' high by 60' 
long. If painting is the method of reproduction, the bulletin is called 
a ``paint'' or a ``painted bulletin.'' If posting is the method of 
reproduction, the bulletin is called a ``posted bulletin.'' Bulletin 
billboards are frequently sold singly to advertisers at negotiated 
rental prices that depend primarily on each billboard's location. 
Bulletins sold in this fashion are called ``permanent bulletins'' and 
command, on average, the highest rent of any type of billboard. 
Bulletins are also rented as part of ``rotary'' plans by billboard 
companies. A rotary plan consists of rotating an advertiser's bulletin 
message to a number of well distributed bulletin locations within a 
metropolitan area. Usually located adjacent to interstate highways and 
high traffic arterials, bulletins are typically sold to advertisers for 
longer contract periods than other types of billboards because of the 
high initial expense in painting or posting the advertiser's message or 
illustration.
    A second type of standardized billboard is the ``poster panel,'' 
which comes in one size, 12' high by 25' long and which is customarily 
sold in packages called ``showings.'' A ``100 showing'' of poster 
panels means that the billboard company will provide enough 
geographically distributed poster panels to deliver in one day a number 
of exposure opportunities, as measured by the traffic count past all 
the poster panels included in the showing, equal to 100% of the 
population of that particular market. In the Atlanta area, for example, 
a 100 showing requires approximately 120 poster panels. The advertising 
message on a poster panel billboard is carried on a printed paper 
poster. Poster panels are nearly always sold in groups by billboard 
companies and usually for a shorter contract period than painted 
bulletin billboards. Poster panels are generally located adjacent to 
primary arterial roads and busy secondary streets. The rental price for 
each poster panel is a showing averages about one-fifth of the rental 
price for each painted bulletin in a rotary.
    A third type of standardized billboard is the ``8-sheet,'' 
sometimes referred to as a ``junior billboard.'' An 8-sheet is 
approximately 6' high by 12' long. An advertiser's message on an 8-
sheet is usually carried on a printed paper poster. In the Atlanta 
area, nearly all 8-sheet locations are in inner city areas, and 8-
sheets are usually sold in packages directed to residents of the areas 
in which they are located. An 8-sheet rents, on average, for less than 
one-third the rental price of a poster panel.
    Many customers who use outdoor advertising also advertise in other 
media, especially radio, television, newspapers and magazines, but use 
outdoor advertising when they want a large number of exposures to 
consumers at a low cost per exposure. Since exposure is necessarily 
brief, outdoor advertising is most suitable for highly visual, limited 
informational advertising. Outdoor advertising's particular 
characteristics make it a type of advertising for which there are no 
close substitutes. The Complaint alleges that the customers who want or 
need to use outdoor advertising would not switch to another advertising 
medium in response to a small but significant increase in outdoor 
advertising rental prices.
    The Atlanta area includes the City of Atlanta and the five populous 
counties that include and surround that city. The vast majority of the 
population of the greater Atlanta region lives or works in the Atlanta 
area and most of that region's commercial activity occurs in the 
Atlanta area. Advertisers who desire to employ outdoor advertising to 
reach the Atlanta consumer market have no reasonable substitute for 
billboards located within the Atlanta area; in particular, a small but 
significant increase in the price of outdoor advertising in the Atlanta 
area would not cause advertisers to turn to billboards located in more 
rural counties outside of the Atlanta area. About 93% of Capitol's and 
OSI's billboard sites are located in the Atlanta area. The Atlanta area 
constitutes a section of the country and relevant geographic market for 
antitrust purposes.
    OSI and Capitol are the only companies that offer a full line of 
billboards in the Atlanta area. Together, OSI and Capitol control over 
63% of all billboards in the Atlanta area. They are the only sellers of 
poster panel billboards and are two of only four sellers of bulletin 
rotary billboard service in the Atlanta area. A combined OSI-Capitol 
entity would control about 4,000 bulletin and poster panel billboards 
in the Atlanta area, over six times the total of the next largest 
outdoor advertising company in the Atlanta area and approximately 
eleven times the total of the third largest. The proposed acquisition 
of Capitol by OSI would raise OSI's market share of the outdoor 
advertising business in the Atlanta area, based upon the number of 
billboards, from approximately 24% to approximately 63%.
    The Complaint further alleges that successful new entry into the 
outdoor advertising market in the Atlanta area is not easy, due in part 
to the increasing amount of government regulation limiting billboard 
construction, the scarcity of suitable billboard sites within in the 
Atlanta area, paticularly within the I-285 Perimeter around Atlanta, 
and the necessity of obtaining a sufficient number and geographic 
dispersion of billboard sites in order to be an effective competitor.
    OSI regularly contracts with customers outside the State of Georgia 
for the sale of outdoor advertising in the Atlanta area and regularly 
receives outdoor advertising materials from outside of Georgia. OSI is 
engaged in interstate commerce, and its activities are in the flow of, 
and substantially affect, interstate commerce.

III

Effect on Competition

    The effect of OSI's acquisition of Capitol's outdoor advertising 
business in the Atlanta area may be substantially to lessen competition 
in outdoor advertising in the Atlanta area because actual and potential 
competition between OSI and Capitol in outdoor advertising in the 
Atlanta area will be eliminated, and competition generally in outdoor 
advertising in the Atlanta area may be substantially lessened.

IV

Explanation of the Proposed Final Judgment

    The United States brought this action because the effect of the 
proposed merger of OSI and Capitol may be substantially to lessen 
competition, in violation of Section 7, in the Atlanta area outdoor 
advertising market. The risk posed to competition by this transaction, 
however, would be substantially eliminated were defendant OSI to divest 
its outdoor advertising business to a purchaser that would operate it 
as an active, independent and financially viable competitor in the 
Atlanta area. To this end, the provisions of the proposed Final 
Judgment are designed to accomplish the sale of OSI's outdoor 
advertising business and to prevent the anticompetitive effects of the 
proposed acquisition.
    The Final Judgment allows OSI to acquire the outdoor advertising 
business of Capitol, but requires OSI to sell its Atlanta outdoor 
advertising business to an independent third party within six months. 
The United States has the right to approve the purchaser. If OSI does 
not accomplish the sale within six months, a trustee will be appointed 
by the Court with full powers to make the sale. Pending the sale of 
OSI's Atlanta outdoor advertising business, a holding company will be 
established to preserve and hold separate the assets and business 
operations of OSI and Capitol. The proposed Final Judgment should 
ensure that an appropriate purchaser will obtain OSI's divested outdoor 
advertising business and operate it as a competitive member of the 
Atlanta area outdoor advertising market.

V

Remedies Available to Potential Litigants

    Section 4 of the Clayton Act, 15 U.S.C. Sec. 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 not assist the bringing of any private antitrust actions. Under 
the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 
Sec. 16(a), the proposed Final Judgment has no prima facie effect in 
any private lawsuit that may be brought against the defendant.

Procedures Available for Modification of the Proposed Final Judgment

    The United States and OSI 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 
until the divestiture of OSI's Atlanta business is accomplished.
    As provided by the APPA, any person believing that the proposed 
Final Judgment should be modified may submit written comments within 
the sixty-day period from the date of publication in the Federal 
Register to John T. Orr, Chief, Atlanta Field Office, Antitrust 
Division, U.S. Department of Justice, Suite 1176, 75 Spring Street, 
SW., Atlanta, GA 30303. 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 other necessary or appropriate for their modification, 
interpretation or enforcement.

VII

Alternatives to the Proposed Final Judgment

    The United States considered, as an alternative to the proposed 
Final Judgment, litigation to enjoin the major. 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 outdoor 
advertising industry in the Atlanta area. The United States believes 
that in the hands of the appropriate purchaser, the outdoor advertising 
business that is divested will likely maintain the present level of 
competition in the Atlanta area.

VIII

Determinative Documents

    No documents were determinative in the formulation of the proposed 
Final Judgment. Consequently, the United States has not attached any 
such documents to the proposed Final Judgment.

    Dated: September 8, 1994.
John T. Orr,
Georgia Bar No.: 554625.
Justin M. Nicholson,
William G. Traynor,
Attorney, Antitrust Division, U.S. Department of Justice, Richard B. 
Russell Building, 75 Spring Street SW., Suite 1176, Atlanta, Georgia 
30303, (404) 331-7100.

[FR Doc. 94-23411 Filed 9-22-94; 8:45 am]
BILLING CODE 4410-01-M