[Federal Register Volume 65, Number 38 (Friday, February 25, 2000)]
[Notices]
[Pages 10109-10111]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-4509]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Fiat S.p.A., Fiat Acquisition Corporation, New 
Holland N.V., New Holland, North America, Inc., and Case Corporation, 
Civil Action No. 99-02927(JR) (D.D.C.); Response to Public Comments

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec. 16(b)-(h), that Public Comments and the 
Responses of the United States have been filed with the United States 
District Court for the District of Columbia in United States v. Fiat 
S.p.A., Fiat Acquisition Corporation, New Holland N.V., New Holland 
North America, Inc., and Case Corporation, Civil Action No. 99-
02927(JR) (D.D.C. filed Nov. 4, 1999). On November 4, 1999, the United 
States filed a Complaint alleging that the proposed acquisition of Case 
Corporation (``Case'') by Fiat S.p.A. and related companies 
(collectively ``Fiat'') would violate Section 7 of the Clayton Act, 15 
U.S.C. 18. The proposed Final Judgment, filed at the same time as the 
Complaint, permits Fiat to acquire Case, but requires that Fiat divest 
specified assets used in the manufacture and sale of tractors and hay 
and forage equipment.
    Public comment was invited within the statutory 60-day comment 
period. The two Comments received, and the Responses thereto, have been 
filed with the Court and are hereby published in the Federal Register. 
Copies of the Complaint, Hold Separate Stipulation and Order, proposed 
Final Judgment, Competitive Impact Statement, Public Comments and the 
Responses of the United States are available for inspection in Room 215 
of the Antitrust Division, Department of Justice, 325 7th Street, N.W., 
Washington, D.C. 20530 (telephone: 202-514-2481) and at the Office of 
the Clerk of the United States District Court for the District of 
Columbia, 333 Constitution Avenue, N.W., Washington, D.C.
    Copies of any of these materials may be obtained upon request and 
payment of a copying fee.

Constance K. Robinson,
Director of Operations and Merger Enforcement Antitrust Division.

United States Response to Comments

    The United States of America hereby files with the Court the 
written comments that it received in this case, and its responses 
thereto, and states:
    1. The Complaint in this case, the proposed Final Judgment, and the 
Hold

[[Page 10110]]

Separate Stipulation and Order (``Stipulation'') were filed on November 
4, 1999. The United States' Competitive Impact Statement was filed on 
November 19, 1999.
    2. Pursuant to 15 U.S.C. Sec. 16(b), the proposed Final Judgment, 
Stipulation, and Competitive Impact Statement were published in the 
Federal Register on December 7, 1999 (64 Fed. Reg. 68377-87).
    3. Pursuant to 15 U.S.C. Sec. 16(c), a summary of the terms of the 
proposed Final Judgment and the Competitive Impact Statement were 
published in The Washington Post, a newspaper of general circulation in 
the District of Columbia, during the period November 6, 1999 through 
December 6, 1999.
    4. The 60-day comment period specified in 15 U.S.C. Sec. 16(b) 
ended on February 5, 2000. The United States received two written 
comments on the proposed settlement: (1) from Mark Zeltwanger of Wyatt 
Farm Center, on December 27, 1999 (attached as Exhibit 1); and (2) from 
august P. Hau of Hau Nutrition Service, on November 30, 1999 (attached 
as Exhibit 3).
    5. Pursuant to 15 U.S.C. Sec. 16(d), the United States has 
considered and responded to these comments. Copies of the United 
States' responses are attached as Exhibits 2 and 4.
    6. The United States is making arrangements to have these comments 
and the United States' responses thereto published in the Federal 
Register, pursuant to 15 U.S.C. Sec. 16(d). As soon as that publication 
has been effected, the United States will notify the Court that it has 
complied with the requirements of the Antitrust Procedures and 
Penalties Act (``APPA''), 15 Sec. 16(b)-(d), and that the Court may 
then enter the proposed Final Judgment after it determines that the 
Judgment serves the public interest.

    Dated: February 9, 2000.

    Respectfully submitted,

Joan Farragher,
Trial Attorney, U.S. Department of Justice, Antitrust Division, 1401 H 
Street, N.W. Suite 3000, Washington, D.C. 20530, (202) 307-6355.

Attachment 1

December 27, 1999.
J Robert Kramer II, Chief, Litigation II Section, Antitrust 
Division, U.S. Department of Justice, 1401 H Street, N.W., Suite 
3000, Washington, D.C. 20530.
    Dear Sir,
    Please be advised that over 1,400 dealers and dealer personnel 
in North America are very upset over Joel Klein's decision to 
require New Holland to divest of their Winnipeg, Canada factory and 
the brand names of Genesis Tractor and versatile tractor in order 
for the buyout of New Holland and Case-IH to be approved.
    To the American farmer this means that one very competitive 
branch of tractor (New Holland Blue Tractors) has been eliminated 
from competition and instead of giving the American farmer more 
choices when he goes to buy a tractor he now only has green or red.
    It seems that Mr. Klein did not listen to his staff who tried to 
tell him this was wrong and succumbed to powerful foreign lobbyists 
who are only interested in helping their own pockets.
    What he has done is already give the John Deere Company a head 
start in gaining more market share and eventually take over as the 
only American company producing AG Tractors over 140HP.
    Please respond.
    Sincerely,

Mark Zeltwanger,
President and CEO Wyatt Farm Center.

Attachment 2

February 9, 2000.
Mark Zeltwanger, President and CEO, Wyatt Farm Center, P.O. Box 59, 
66400 St. Rd. 331, Wyatt, IN 46595.
Re: Comment on Proposed Final Judgment in United States v. Fiat 
S.p.A. et al. (D.D.C. filed Nov 4, 1999).
    Dear Mr. Zeltwanger:
    This letter responds to your December 27, 1999 letter commenting 
on the proposed Final Judgment in United States v. Fiat S.p.A. et 
al. (D.D.C. filed Nov 4, 1999), which is currently pending in 
federal district court in the District of Columbia. The complaint 
filed by the United States alleges that the proposed acquisition of 
Case Corporation (``Case'') by Fiat S.p.A. (``Fiat'') would result 
in a substantial lessening of competition in the manufacture and 
sale of two-wheel drive (``2WD'') tractors, four-wheel-drive 
(``4WD'') tractors, and several types of hay and foraging equipment. 
The proposed Final Judgment would settle the case by requiring the 
divestiture of New Holland's 2WD and 4WD tractor lines and the sale 
of Case's interest in Hay and Forage Industries (``HFI''), a joint 
venture engaged in the manufacture of hay and forage equipment.
    In your letter, you express concern that the proposed Final 
Judgment will result in the elimination of the New Holland tractor 
lines as a competitive alternative in the marketplace. Specifically, 
your letter states that ``to the American farmer, this [settlement] 
means that one very competitive brand of tractor (New Holland blue 
tractors) has been eliminated from competition[,] and instead of 
giving the American farmer more choice when he goes to buy a tractor 
he now only has green [John Deere] and red [Case]''.
    The United States disagrees with your assertion that the 
proposed Final Judgment will reduce the choices available to the 
American farmer when purchasing a new tractor. Far from being 
eliminated, the proposed Final Judgment requires that the New 
Holland tractor lines be sold to another company (or companies) with 
the capability and will to provide substantial competition in the 
tractor markets. Farmers will still be able to buy the New Holland 
tractor lines, and will not suffer a reduction in tractor 
alternatives because of either Fiat's acquisition of Case or the 
terms of the proposed Final Judgment. The United States strongly 
believes the divestitures required by the proposed final Judgment 
will alleviate the competitive concerns alleged in the Complaint and 
preserve competition in the 2WD and 4WD tractor markets.
    Thank you for bringing your concerns to our attention. I trust 
you appreciate that we have given them due consideration, and hope 
this response will help alleviate them. Pursuant to the Antitrust 
Procedures and Penalties Act, 15 U.S.C. Sec. 16(d), a copy of your 
comment and this response will be published in the Federal Register 
and filed with the Court.

    Sincerely yours,
J. Robert Kramer II,
Chief, Litigation II Section.

Attachment 3

HAU NUTRITION SERVICE

5454 Marshview Dr., Hartford, WI 53027, Phone/FAX (414) 644-7806, 
August P. Hau, Feed Consultant.

Mr. J. Robert Kramer II, Chief Litigation II Section, Anti Trust 
Division, U.S. Dept. of Justice, 1401 H Street, NW Suite 3000, 
Washington, DC 20530.

November 30, 1999.

    As an agribusiness professional for 16 years, I write to you 
with great need to stand up against monopolistic control of 
agriculture in this country. In recent decades the poultry and pork 
industries have become vertical monopolies. If you doubt this, just 
ask any family farmer. Feed and milk cooperatives have been allowed 
to merge to the point where they ``know'' what their few 
competitor's price will be in future months! This would make our 
forefathers ill. Some cooperatives have ``no-compete'' clauses with 
each other. Is this free trade? Implement companies who used to 
boast about innovation and produce differentiation are now nesting 
together in hopes of boosting stockholder profits. There is very 
little competition left. Meanwhile farm costs continue upward.
    The recent merger plans between Case/IH and Ford/New Holland is 
obviously monopolistic to me and most of my farmer customers. Case 
and IH should not have been allowed to merge in the first case. Ford 
and New Holland should not have been allowed to merge either. 
Obviously all four merging is much worse. John Deere is the only 
other major manufacturer left . . . so would that merger be approved 
also?
    If this is not clearly unfair competition to the Justice 
Department, then perhaps anti-trust members should resign and let 
the free market take over. That could work no worse than what I have 
seen over the past two decades of my adult life. Most all Americans 
agree Federal Government is too large and incredibly partisan 
anyway. Please exert your power and stop this merger (along with the 
Exxon/Mobil plan). If two companies merge to become the largest 
company in their industry, isn't it clearly monopolistic and

[[Page 10111]]

usually negative for workers and consumers alike?
    Sincerely,

August P. Hau.
 


Attachment 4

February 9, 2000.
     
August P. Hau, Hau Nutrition Service, Hartford, WI 53027.
Re: Comment on Proposed Final Judgment in United States v. Fiat 
S.p.A. et al. (D.D.C. filed Nov. 4, 1999).
    Dear Mr. Hau:
    This letter responds to your November 30, 1999 letter commenting 
on the proposed Final Judgment in United States v. Fiat S.p.A. et 
al. (D.D.C. filed Nov. 4, 1999), which is currently pending in 
federal district court in the District of Columbia. The Complaint 
filed by the United States alleges that the proper acquisition of 
Case Corporation (``Case'') by Fiat S.p.A. (``Fiat'') would result 
in a substantial lessening of competition in the manufacture and 
sale of two-wheel drive (``2WD'') tractors, four-wheel-drive 
(``4WD'') tractors, and several types of hay and foraging equipment. 
The proposed Final Judgment would settle the case by requiring the 
divestiture of New Holland's 2WD and 4WD tractor lines and the sale 
of Case's interest in Hay and Forage Industries (``HFI''), a joint 
venture engaged in the manufacture of hay and forage equipment.
    In your letter, you express concern that Fiat's acquisition of 
Case will harm consumers of farm equipment. Specifically, your 
letter states that: ``If two companies merge to become the largest 
company in their industry, isn't it clearly monopolistic and usually 
negative for workers and consumers alike?'' Your letter also 
expresses concern that ``Case and IH [International Harvester]'' and 
``Ford and New Holland should not have been allowed to merge'' in 
previous transactions.
    Although the United States agrees that Fiat's acquisition of 
Case--if allowed to proceed without the required divestitures--would 
harm farmers who purchase tractors and hay and forage equipment, the 
proposed Final Judgment does not simply allow Fiat and Case to merge 
their agricultural equipment business. The United States strongly 
believes the divestitures required by the proposed Final Judgment 
will alleviate the competitive concerns alleged in the Complaint and 
preserve competition in the manufacture and sale of 2WD tractors, 
4WD tractors, and hay and forage equipment. Finally, the United 
States assures you that it thoroughly investigated the mergers of 
Case/IH and Ford/New Holland and took appropriate enforcement 
action.
    Thank you for bringing your concerns to our attention. I trust 
you appreciate that we have given them due consideration, and hope 
this response will help alleviate them. Pursuant to the Antitrust 
Procedures and Penalties Act, 15 U.S.C. Sec. 16(d), a copy of your 
comment and this response will be published in the Federal Register 
and filed with the Court.
    Sincerely yours,

J. Robert Kramer II,
Chief, Litigation II Section.
[FR Doc. 00-4509 Filed 2-24-00; 8:45 am]
BILLING CODE 4410-11-M