[Federal Register Volume 65, Number 49 (Monday, March 13, 2000)]
[Notices]
[Pages 13309-13325]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-5536]


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DEPARTMENT OF JUSTICE

Anitrust Division


United States of America v. Miller Industries, Inc., Miller 
Industries Towing Equipment, Inc., and Chevron, Inc., No. 1:00CV00305 
(D.D.C., Filed February 17, 2000); Proposed Final Judgment and 
Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation, and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States of America v. Miller Industries, Inc., Miller Industries Towing 
Equipment, Inc., and Chevron, Inc., No. 1:00CV00305. On February 17, 
2000, the United States filed a Complaint alleging that the acquisition 
by Miller Industries, Inc. on September 2, 1996, of all the issued and 
outstanding capital stock of its competitor Vulcan Equipment, Inc., a 
Mississippi corporation, and the acquisition by Miller Industries, Inc. 
on December 5, 1997, of all the issued and outstanding capital stock of 
its competitor Chevron, Inc., a

[[Page 13310]]

Pennsylvania corporation, violated Section 7 of the Clayton Antitrust 
Act, as amended, 15 U.S.C. 18. The proposed Final Judgment, filed with 
a Stipulation at the same time as the Complaint, would require Miller 
Industries, Inc. and its wholly owned subsidiaries Miller Industries 
Towing Equipment, Inc., and Chevron, Inc., to grant to anyone 
requesting it a non-exclusive license, at unit royalties that are not 
to exceed specified amounts, under any one or more of five towing and 
recovery vehicle equipment patents, and to notify the Department of 
Justice prior to future acquisitions of towing and recovery equipment 
assets or patents having a value that exceeds $5 million. The 
Stipulation provides for these patent licenses to become available 
within ten (10) days following the filing of the Stipulation with the 
Court. Copies of the Complaint, Stipulation, proposed Final Judgment, 
and Competitive Impact Statement are available for inspection at the 
Department of Justice in Washington, D.C. in Room 207, 325 Seventh 
Street, NW, where copies may be obtained upon request and payment of a 
copying fee, and at the Office of the Clerk of the United States 
District Court for the District of Columbia.
    Public comment is invited within sixty days of the date of this 
notice. Such comments, and responses thereto, will be published in the 
Federal Register and filed with the Court. Comments should be directed 
to Mary Jean Moltenbrey, Chief, Civil Task Force, Antitrust Division, 
Department of Justice, Suite 300, 325 Seventh Street, NW, Washington, 
D.C. 20530 (telephone: (202) 616-5935)

Rebecca P. Dick,
Director of Civil Non-Merger Enforcement.

Stipulation

    It is stipulated by and between the undersigned parties, by their 
respective attorneys, as follows:
    (1) The 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 this Court.
    (2) The parties stipulate that a Final Judgment in the form hereto 
attached may be filed and entered by the Court, upon the motion of any 
party or upon 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 thereof on defendants and by filing that notice with 
the Court.
    (3) Defendants shall abide by and comply with the provisions of the 
proposed Final Judgment pending its entry by the Court, or until 
expiration of time for all appeals of any Court ruling declining entry 
of the proposed Final Judgment, and shall, from the date of the signing 
of this Stipulation, comply with all the terms and provisions of the 
proposed Final Judgment as though the same were in full force and 
effect as an order of the Court. As part of this compliance, defendants 
shall not assign, transfer interest, or take any action, direct or 
indirect, that will impede or impair the value or ownership rights of 
the `737, `147, `509, `609, and `623 Patents (as those terms are 
defined in the proposed Final Judgment) before the proposed Final 
Judgment shall be effective.
    (4) Pursuant to Section IV of the proposed Final Judgment, 
Defendants shall offer to any requesting third party a license or 
licenses, the terms of which shall comply with the terms set forth in 
the proposed Final Judgment and Exhibits A and B thereof; provided, 
however, that if the proposed Final Judgment has not been entered 
because Plaintiff has withdrawn its consent or the time for all appeals 
of any Court ruling declining entry of the proposed Final Judgment has 
expired, then the license(s) shall terminate effective upon withdrawal 
of consent of expiration of time for appeals. As provided in Exhibits A 
and B, licensees shall have the right to sell at any time products made 
within 60 days of termination caused by the withdrawal of the 
Plaintiff's consent or by the Court's declining to enter the proposed 
Final Judgment.
    (5) Within ten (10) days of its filing of the proposed Final 
Judgment and every thirty days thereafter until entry of the Final 
Judgment, defendants shall provide Plaintiff an affidavit setting forth 
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 
license, expressed an interest in licensing, entered into negotiations 
to license, or was contacted or made an inquiry about licensing the 
`737, `147, `509, `609, or `623 Patents, and shall describe in detail 
each contact with any such person during that period.
    (6) This Stipulation shall apply with equal force and effect to any 
amended proposed Final Judgment agreed upon in writing by the parties 
and submitted to the Court.
    (7) In the event Plaintiff withdraws its consent, as provided in 
paragraph (2) above, or in the event that the Court declines to enter 
the proposed Final Judgment pursuant to this Stipulation, the time has 
expired for all appeals of any Court ruling declining entry of the 
proposed Final Judgment, and the Court has not otherwise ordered 
continued compliance with the terms and provisions of the proposed 
Final Judgment, then the parties are released from all further 
obligations under this Stipulation, and the making of this Stipulation 
shall be without prejudice to any party in this or any other 
proceeding.
    (8) Defendants represent that the licenses ordered in the proposed 
Final Judgment can and will be made, and that defendants will later 
raise no claims of hardship or difficulty as grounds for asking the 
Court to modify any of the licensing provisions contained therein.

    For plaintiff United States of America:
Susan L. Edelheit,
D.C. Bar No. 250 720, Assistant Chief, Civil Task Force Antitrust 
Division, U.S. Department of Justice, Suite 300, 325 7th Street, NW, 
Washington, D.C. 20530, (202) 514-5038.
    Date Signed: February 16, 2000.

    For Miller Industries, Inc., Miller Industries Towing Equipment, 
Inc., and Chevron, Inc.
C. Loring Jetton, Jr.,
(202) 663-6738, D.C. Bar No. 083766
John Q. Rounsaville, Jr.,
(202) 663-6328, D.C. Bar No. 162305
William F. Adkinson, Jr.,
(202) 663-6530, D.C. Bar No. 411922
Wilmer, Cutler & Pickering, 2445 M Street, NW, Washington, DC 20037.
    Date Signed: February 16, 2000.

Frank Madonia,
Executive Vice President and General Counsel, Miller Industries, 
Inc., 8503 Hilltop Drive, Ooltewah, TN 37363--0120, (423) 238-4171.
    Date Signed: February 16, 2000.

    Stipulation Approved for Filing:
Ordered this ____ day of ____________, 2000.

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

Final Judgment

    Whereas, Plaintiff, the United States of America (``United 
States''), having filed its Complaint in this action, and Plaintiff and 
Defendants, Miller Industries, Inc. and its wholly-owned subsidiaries 
Miller Industries Towing Equipment, Inc., and Chevron, Inc. (any one or 
more of which may be referred to as ``Miller Industries''), by their 
respective attorneys, having consented to the entry of this Final 
Judgment without trial or adjudication of any issue of fact or law 
herein, and without this Final Judgment constituting any evidence 
against or an admission by any

[[Page 13311]]

party with respect to any issue of law or fact herein;
    And Whereas Defendants have agreed to be bound by the provisions of 
this Final Judgment pending its approval by the Court;
    And Whereas the essence of this Final Judgment is the prompt and 
certain licensing of specified patents to one or more third parties;
    And whereas Defendants, as alleged in the Complaint, as owners of 
all right, title, and interest in the L-Arm Patent (defined below), 
acquired all of the capital stock of Vulcan International, Inc., 
including all right, title, and interest in the Vulcan Improvement 
Patents (defined below), and thereafter acquired all of the capital 
stock of Chevron, Inc., including all right, title and interest in the 
Independent Wheel Lift Patent and the Backsaver Patent (defined below):
    And whereas licensing of the specified patents is necessary to 
remedy the loss of competition resulting from Defendants' acquisition 
of control of competitors' assets as alleged in the Complaint;
    And whereas Plaintiff takes no position as to the validity or 
enforceability of the patents at issue or as to whether they are or 
have been infringed by any third parties, and Plaintiff and Defendants 
agree that this Final Judgment shall have no impact whatsoever on any 
adjudication concerning the validity or enforceability of the patents 
at issue or any other patents assigned to or owned by Defendants;
    And whereas Defendants have represented to Plaintiff that Miller 
Industries is the owner of the patents at issue, that the licensing and 
other terms and conditions ordered herein can and will be accomplished, 
and that Defendants will later raise no claims of hardship or 
difficulty as grounds for asking the Court to modify any of the 
provisions contained below;
    Now, therefore, before the taking of any testimony, and without 
trial or adjudication of any issue of fact or law herein, and upon 
consent of the parties hereto, 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 hereto. The Complaint states a claim upon 
which relief may be granted against the Defendants, as hereinafter 
defined, under Section 7 of the Clayton Act, as amended (15 U.S.C. 18).

II.

Definitions

    As used in this Final Judgment:
    A. ``Miller Industries'' shall mean one or more of Miller 
Industries, Inc., a Tennessee corporation headquartered in Ooltewah, 
TN, and tits wholly-owned subsidiaries Miller Industries Towing 
Equipment, Inc., a Delaware corporation headquartered in Ooltewah, TN, 
and Chevron, Inc., a Pennsylvania corporation headquartered in Mercer, 
PA, and their successors, assigns, subsidiaries, divisions, groups, 
affiliates, partnerships and joint ventures, and directors, officers, 
managers, agents, and employees.
    B. ``Produce,'' ``Producing,'' or ``Production'' shall mean to 
manufacture, make, have made, import into the United States, use, offer 
to sell, sell or otherwise dispose of
    C. ``The `737 Patent'' (commonly referred to as the `` L-Arm 
Patent'') shall mean United States Patent Number 4,836,737 and all 
continuations, continuations-in-part, and divisions or reissues 
thereof, if any.
    D. ``The `623 Patent'' shall mean United States Patent Number 
4,637,623 and all continuations, continuations-in-part, and divisions 
or reissues thereof, if any.
    E. ``The `509 Patent'' shall mean United States Patent Number 
4,798,509 and all continuations, continuations-in-part, and divisions 
or reissues thereof, if any.
    F. ``The `147 Patent'' (commonly referred to as the ``Independent 
Raise-and-Lower Patent'') shall mean United States Patent Number 
5,061,147 and all continuations, continuations-in-part, and divisions 
or reissues thereof, if any.
    G. ``The `609 Patent'' (commonly referred to as the ``Backsaver 
Patent'') shall mean United States Patent Number 5,628,609 and all 
continuations, continuations-in-part, and divisions or reissues 
thereof, if any.
    H. The ``Century Design'' shall mean Miller Industries' wheel lift 
designs depicted in the engineering drawings attached as Exhibit D and 
E and which are embodied in Century Model Nos. 124002217 and 12400221, 
currently being marked by Miller Industries in the United States, as 
well as the wheel lift designs incorporated in the previously marketed 
Century Model Nos. 124001824 and 124001825.
    I. ``The Improvement Patents'' (commonly referred to as the 
``Vulcan Improvement Patents,'' covering such items as the horizontal 
and vertical ``pivot'' L-arm features) shall mean the `623 Patent and 
the `509 Patent.
    J. The ``Licensed Claims of the Improvements Patents'' shall mean 
Claims 1-3, 6-10, 12, 15, 17, 18, 20 and 22 of the `623 Patent and 
Claims 1, 4-9, 11-14 and 16-19 of the `509 Patent. The Licensed Claims 
include such features as the horizontal and vertical ``pivot'' of the 
L-arm.
    K. The ``Unlicensed Claims of the Improvements Patents'' shall mean 
Claims 4, 5, 11, 13-14, 16, 19 or 21 of the `623 Patent and Claims 2, 
3, 10 or 15 of the `509 Patent. The Unlicensed Claims of the 
Improvement Patents embody the following features of the Improvement 
Patents: (1) the vertical locking pin device; (2) the elongated curved 
wheel retainer plate (sometimes referred to as ``the Scoop''); and (3) 
the wheel lift receiver placed completely above the cross-bar. The act 
of Producing products containing (a) a horizontal locking pin device, 
(b) a vertical alignment pin on the receiver used in combination with a 
horizontal locking pin device, or (c) two flat surfaces joined together 
to form the wheel retainer plate, or any combination of (a), (b), or 
(c), by a licensee under the Licensed Claims of the Improvement Patent 
shall not constitute an infringement of any of the Unlicensed Claims of 
the Improvement Patents.

III.

Applicability

    The provisions of this Final Judgment apply to Miller Industries, 
its successors and assigns (including any transferee or assignee of any 
ownership rights to, control of, or ability to license the patents 
referred to in this Final Judgment), its subsidiaries, affiliates, 
directors, officers, managers, agents, and employees, and 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.

IV

Licensing of Patents

    A. Beginning no later than ten (10) business days after the filing 
pursuant to 15 U.S.C. 16(b) of this Final Judgment, Miller Industries 
shall offer to any third party a non-exclusive license in the form 
attached hereto as Exhibit A (with the exception of licenses that 
include the Improvement Patents) or Exhibit B (for licenses that 
include the Improvement Patents) under the following patents subject to 
license fees not to exceed the corresponding stated amount per unit:

[[Page 13312]]



 
------------------------------------------------------------------------
                                                                  Unit
                                                                license
                   Patent(s) to be licensed                     fee not
                                                               to exceed
------------------------------------------------------------------------
`737 Patent..................................................     125.00
`147 Patent..................................................     150.00
`609 Patent..................................................     150.00
Licensed Claims of the Improvement Patents...................     150.00
`737 Patent & `147 Patent, Together..........................     175.00
`737 Patent & `609 Patent, Together..........................     175.00
`737 Patent & Licensed Claims of the Improvement Patents,         175.00
 Together....................................................
------------------------------------------------------------------------

The Maximum Unit License Fee shall be adjusted up or down annually in 
accordance with the change in the U.S. Department of Labor Producer 
Price Index for Finished Goods.
    B. Such licenses shall be available for the life of the licensed 
patent. The Maximum Unit License Fee for a license covering more than 
one patent shall, in the event of the expiration of any covered patent, 
be modified to reflect the Maximum Unit License Fee for the remaining 
licensed patent or patents. The terms of Exhibit A or Exhibit B may be 
modified upon consent of both parties to the license.
    C. In accomplishing the licensing ordered by this Section IV, 
Miller Industries shall retain the services of an Independent Auditor 
(a certified public accountant from a firm of good standing) who shall 
collect from each licensee reports and royalty payments as required by 
each license agreement made pursuant to this Final Judgment. Miller 
Industries shall instruct the Independent Auditor to provide Miller 
Industries no more frequently than on a quarterly basis the aggregate 
dollar amount of royalty payments collected under each category of 
license set forth in Paragraph A hereof, together with a report stating 
the name of each licensee making royalty payments and the aggregate 
number of units of licensed products reported by all licensees for that 
period. Miller Industries shall instruct the Independent Auditor not to 
provide or disclose any information or data that would allow Miller 
Industries to determine the number of units of licensed products 
produced by any particular licensee, but may permit the Independent 
Audit to disclose to it facts that constitute grounds for material 
breach under the terms of the license.
    D. Any existing licensee of any one or more of the `147, `509, 
`609, `623 or `737 Patents may elect to modify its existing license to 
any such patent by substituting the terms and conditions of the 
licenses available pursuant to this Section IV on thirty (30) days` 
written notice to Miller Industries.
    In accomplishing the licensing ordered by this Section IV, Miller 
Industries promptly shall make known, by usual and customary means, the 
availability of the licenses, including mailing within ten (10) days of 
filing pursuant to 15 U.S.C. 16(b) of this Final Judgment notices of 
the available licenses in the form of Exhibit C along with copies of 
this Final Judgment to all firms known to it that manufacture tow 
trucks, car carriers, or similar towing and recovery vehicles. Miller 
Industries shall provide any person making an inquiry regarding a 
possible license with a copy of this Final Judgment, including all 
exhibits thereto. At Plaintiff`s request, Miller Industries shall 
furnish to Plaintiff copies of any executed licenses made pursuant to 
this Section IV.
    F. Miller Industries shall retain the services of a Designated 
Expert, to be selected by Plaintiff in its sole discretion, who shall, 
at the request of any existing or prospective Licensee of the 
Improvement Patents (hereafter ``Licensee''), determine whether a 
proposed design is an ``Approved Proposed Design.'' A proposed design 
shall be an Approved Proposed Design if it falls within the Licensed 
Claims of the Improvement Patents and does not fall within the 
Unlicensed Claims. Miller Industries shall provide the Designated 
Expert with a copy of this Final Judgment and shall instruct him/her to 
use his/her best efforts to provide the Licensee with a written 
determination within 30 days after receipt of engineering drawings and 
other necessary information. A Licensee has no obligation to request a 
determination from the Designated Expert, and use of the Designated 
Expert is at a Licensee`s sole discretion.
    G. Miller Industries shall be bound by the Designated Expert`s 
determination that a proposed design is an Approved Proposed Design, 
and shall not challenge as infringement of any Unlicensed Claim the 
Licensee`s Production of products made in accordance with the 
specifications of an Approved Proposed Design.
    H. Miller Industries shall instruct the Designated Expert to keep 
confidential all submissions and contact with any Licensee seeking a 
determination, and shall instruct the Designated Expert not to disclose 
to Miller Industries or any third party, unless required to do so by 
law, any information concerning the Licensee`s request for a 
determination on any proposed design. However, Miller Industries may 
instruct the Designated Expert (1) to notify Miller Industries after a 
proposed design has been approved, of the identity of the firm 
submitting the design, and (2) after the Licensee has begun selling 
products made in accordance with an Approved Proposed Design, to 
provide Miller Industries with a description of the product and its 
features sufficient to enable Miller Industries to determine whether 
the product is made in accordance with the specifications of the 
Approved Proposed Design, subject to the Licensee`s confirmation that 
the description to be disclosed reveals no confidential data or trade 
secrets.
    I. Miller Industries will pay the Designated Expert`s fees, up to 
maximum of five (5) thousand dollars, for his/her services in gaining 
sufficient familiarity with the licensed patents and the scope of the 
claims thereof to enable him/her to undertake to determine whether 
proposed designs are Approved Proposed Designs. The cost of the 
Designated Expert`s determination of whether a given submitted proposed 
design is an Approved Proposed Design shall be borne by the Licensee.
    J. Within fifteen days from the filing pursuant to 15 U.S.C. 16(b) 
of this Final Judgment, Miller Industries shall provide Plaintiff with 
the names of three candidates (each with sufficient expertise in patent 
interpretation to be able to make qualified determinations) who have no 
affiliation or relationship with Miller Industries or any other 
towtruck or car carrier manufacturer to serve as the Designated Expert. 
After reviewing these candidates, Plaintiff may request from Miller 
Industries the names of additional candidates to serve as Designated 
Expert, Miller Industries shall provide such additional names within 
fifteen days from receipt of such request. Should Plaintiff object to 
all candidates submitted by Miller Industries, Plaintiff may select a 
Designated Expert of its own choosing.
    K. Miller Industries shall not challenge as infringement of its 
Unlicensed Claims, or of any other claims of any patents owned by or 
assigned to Miller Industries, the Production of a product embodying 
the Century Design by a licensee of the `737 Patent and the Licensed 
Claims of the Improvement Patents. Miller Industries shall also not 
challenge as infringement of any claims under the Improvement Patents 
the Production of a product with a wheel lift design made pursuant to 
the specification in the `609 Patent (the ``Backsaver Design'') by a 
licensee of the `609 Patent.

[[Page 13313]]

V

Limitations

    A. Nothing in this Final Judgment shall be construed to restrict 
Miller Industries` ability to manufacture and sell products pursuant to 
the `737 Patent, the Improvement Patents, the `147 Patent, or the `609 
Patent.
    B. Notwithstanding Section IV of this Final Judgment, Miller 
Industries is not required to grant a license to any person to whom a 
license was previously granted under this Final Judgment that was 
terminated for material breach.

VI

Notification

    A. Miller Industries shall provide advance notification to the 
Plaintiff (1) when it directly or indirectly acquires (other than in 
the ordinary course of business as defined in the HSR regulations) any 
assets of, or any interest (including any financial, security, loan, 
equity, or management interest) in, any manufacturer of towtrucks, car 
carriers, or other towing and recovery equipment, with the exception of 
any transaction where the total value of the assets or interest being 
acquired is less than five (5) million dollars; or (2) when it directly 
or indirectly (i) acquires any exclusive license or (ii) acquires or is 
assigned any ownership or security interest in a patent or patents 
relating to the manufacture of towtrucks, car carriers, or other towing 
and recovery equipment, with the execution of any transaction where the 
total value of the interest acquired in such patent rights is less than 
five (5) million dollars. For purpose of this paragraph, total value 
shall be determined as prescribed in 16 CFR Sec. 801.00. If the 
transaction is covered by the reporting and waiting period requirements 
of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as 
amended, 15 U.S.C. 18a (the ``HSR Act''), Miller Industries' obligation 
to provide notification under this Section shall be satisfied by 
compliance with the HSR Act.
    B. Notification under this section shall be provided to the 
Plaintiff in the same format as, and per the instructions relating to, 
the Notification and Report Form set forth in the Appendix to Part 803 
of Title 16 of the Code of Federal Regulations, as amended. 
Notification shall be provided at least thirty (30) days prior to the 
acquisition of such interest, and shall include, beyond what may be 
required by the applicable instructions, the names of the principal 
representatives of the parties to the agreement who negotiated the 
agreement, and any management or strategic plans discussing the 
proposed transaction. If within the 30-day period after notification 
representatives of the Plaintiff make a written request for additional 
information, Defendant shall not consummate the proposed transaction or 
agreement until twenty (20) days after substantial compliance with the 
request for such additional information. The Plaintiff may, however, 
grant defendant early termination of the waiting periods prescribed by 
this Section. This Section shall be broadly construed, and any 
ambiguity or uncertainty regarding the necessity of filing such 
notification under this Section shall be resolved in favor of filing 
notice.

VII

Affidavits

    A. Miller Industries shall provide Plaintiff an affidavit within 
ten (10) days of the filing pursuant to 15 U.S.C. 16(b) of this Final 
Judgment, and every six (6) months thereafter until the life of each of 
`147, `509, `609, `623 and the `737 Patents has expired, as to the fact 
and manner of compliance with Section IV hereof. Each such affidavit 
shall set forth efforts made to accomplish licensing of the patents 
contemplated in his Final Judgment and shall include, inter alia, 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 
license, expressed an interest in licensing, entered into negotiations 
to license, or was contacted or made an inquiry about licensing the 
patents to be licensed, and shall describe in detail each contact with 
any such person during that period.
    B. Until one year after each of the `147, `509, `609, `623 and the 
`737 Patents have expired, Miller shall preserve all records of all 
efforts made to effect the licensing of each such patent.

VIII

Compliance Inspection

    For the purpose of determining or securing compliance with this 
Final Judgment, or determining whether the Final Judgment should be 
further modified or terminated, and subject to any legally recognized 
privilege, from time to time:
    A. Duly authorized representatives of the United States Department 
of Justice, upon written request of the Attorney General or the 
Assistant General in charge of the Antitrust Division, and on 
reasonable notice to Defendants made to their principal offices, shall 
be permitted:
    1. Access during office hours of Defendants to inspect and copy all 
books, ledgers, accounts, correspondence, memoranda, and other records 
and documents in the possession or under the control of Defendants, who 
may have counsel present, relating to any matters contained in this 
Final Judgment; and
    2. Subject to the reasonable convenience of Defendants and without 
restraint or interference from them, to interview, either informally or 
on the record, their officers, employees, and agents, who may have 
counsel present, regarding any such matters.
    B. Upon the written request of the Attorney General or of the 
Assistant Attorney General in charge of the Antitrust Division, made to 
Defendants at their principal offices, Defendants shall submit such 
written reports, under oath if requested, with respect to any of the 
matters contained in this Final Judgment.
    C. No information nor any documents obtained by the means provided 
in Sections VII or VIII of this Final Judgment shall be divulged by a 
representative of the United States 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 
Defendants to Plaintiff, Defendants represent and identify in writing 
the material in any such information or documents for which a claim of 
protection may be asserted under Rule 26(c)(7) of the Federal Rules of 
Civil Procedure, and Defendants mark each pertinent page of such 
material, ``Subject to claim of protection under Rule 26(c)(7) of the 
Federal Rules of Civil Procedure,'' then Plaintiff shall give ten (10) 
days notice to Defendants prior to divulging such material in any legal 
proceeding (other than a grand jury proceeding) to which Defendants are 
not a party.

IX

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

[[Page 13314]]

enforcement of compliance herewith, and for the punishment of any 
violation hereof.

X

Termination

    Unless this Court grants an extension, this Final Judgment will 
expire on the tenth anniversary of the date of its entry.

XI

Public Interest

    Entry of this Final Judgment is in the public interest.

    Dated:________________________
Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16.
United States District Judge

Exhibit A: License Agreement

    [Exhibit A to be used for licensing United States Patent Number 
5,061,147 (``The Independent Raise-and-Lower Patent''); United 
States Number 5,628,609 (``The Backsaver Patent''); United States 
Patent Number 4,836,737 (``The L-Arm Patent''); or a combination of 
the '737 Patent and either the '147 or '609 Patents. Please see 
Exhibit B for licenses relating to United States Patent Number 4, 
798,509 & United States Patent Number 4,637,623 (collectively, the 
``Improvement Patents'')]
    This License Agreement is made by and between ____________ 
(``Licensee'') and MILLER INDUSTRIES, INC., or a designated 
subsidiary thereof (and its successors and assigns, collectively 
``Licensor'').
    Whereas, Licensor is the owner of [United States Patent Number 
5,061,147; United States Patent Number 5,628,609; and/or United 
States Patent Number 4,836,737]
    And whereas, Licensee desires to obtain a license from Licensor 
relating to said patent [or patents];
    And whereas, Licensor desire to grant Licensee such a license;
    Now, therefore, in consideration of the foregoing and of the 
mutual covenants which follow, the parties hereby agree that:

Article 1--Definitions

    As used in this Agreement, the following terms shall have the 
following meanings:
    1.01. ``The '737 Patent'' shall mean United States Patent Number 
4,836,737. [``the '147 Patent'' shall mean United States Patent 
Number 5,061,147; and/or ``the '609 Patent'' shall mean United 
States Patent Number 5,628,609.]
    1.02. ``Royalty Bearing Products'' shall mean products made in 
accordance with the claims of the '737 Patent [the '147 Patent and/
or the '609 Patent].
    1.03. ``Independent Auditor'' shall mean a person or persons 
appointed by Licensor subject to the terms and conditions of Section 
IV of the Final Judgment in United States v. Miller Industries, 
Inc., Civ. 1:00CV00305 (D.D.C. 2000).

Article 2--License and Related Terms

    2.01. Patent License. During the term of this Agreement, subject 
to the terms and conditions hereof, including, without limitation, 
the timely payment by Licensee to the Independent Auditor of the 
license fees provided for in Section 2.02 hereof, Licensor hereby 
grants to Licensee, and Licensee hereby accepts from Licensor, a 
non-exclusive, non-transferable (except as specifically provided in 
Section 5.05 hereof), right and license under the `737 Patent [the 
`147 Patent and/or the `609 Patent] to make, have made, import, use, 
offer to sell, sell or otherwise dispose of Royalty Bearing Products 
within the United States.
    2.02. Royalties. In consideration of the license granted under 
Section 2.01 hereof, Licensee shall pay Licensor a royalty of $ 
____\1\ per unit for each Royalty Bearing Product Sold or Otherwise 
Disposed of by or for Licensee. The term ``Sold or Otherwise 
Disposed of'' includes Royalty Bearing Products sold, leased, placed 
in commercial service, or delivered by or on behalf of Licensee 
within the United States. In no event shall a licensee pay more than 
one royalty on a single unit of Royalty Bearing Product.
---------------------------------------------------------------------------

    \1\ Royalties shall not exceed the following: `737 Patent: 
$125.00 per unit; `147 Patent: $150.00 per unit; `609 Patent: 
$150.00 per unit; `147 and `737 Patents, together: $175.00 per unit; 
`609 and `737 Patents, together: $175.00 per unit.
    These maximum limits on royalties shall be adjusted up or down 
annually in accordance with the change in the U.S. Department of 
Labor Producer Price Index for Finished Goods.
---------------------------------------------------------------------------

Article 3--Notice Provisions

    3.01. Licensee shall make written reports to the Independent 
Auditor within 30 days of the end of each calendar quarter through 
the life of the `737 patent [the `147 Patent and/or the `609 Patent] 
stating in each such report the aggregate number of Royalty Bearing 
Products it has Sold or Otherwise Disposed of within the United 
States during such calendar quarter and upon which royalty is 
payable as provided in this Agreement. The first such report shall 
include all Royalty Bearing Products Licensee has Sold or Otherwise 
Disposed of between the date of this Agreement and the date of such 
report. The Independent Auditor shall report to the Licensor only 
such information as is permitted under Paragraph IV.C of the Final 
Judgment in United States v. Miller Industries, Inc., et al., Civ. 
1;00CV00305 (D.D.C. 2000).
    3.02. Concurrently with each report, Licensee shall pay to the 
Independent Auditor royalties at the rate specified in Article 2.02 
of this Agreement on the Royalty Bearing Products included in the 
report.
    3.03. Licensee shall keep accurate books and records in 
accordance with accepted accounting practices showing the Royalty 
Bearing Products it made, had made, imported, used, offered for 
sale, Sold or Otherwise Disposed of during the life of this License 
Agreement. Such records shall be in sufficient detail to enable the 
royalties payable to Licensor to be determined.
    3.04. The Independent Auditor shall notify Licensor when, in his 
or her independent judgment, an audit is appropriate, and upon 
Licensor's approval shall conduct an audit. Upon request of the 
Independent Auditor, Licensee will permit its books and records 
pertinent to the determination of the royalties payable to Licensor 
to be examined to the extent reasonably necessary for the 
Independent Auditor to verify the reports provided by Licensee. In 
the event that the Auditor shall have questions that appear not to 
be answered by such books and records, the Auditor shall have the 
right to confer with representatives of the Licensee, including but 
not limited to the Licensee's Chief Financial Officer and Plant 
Manager. Such examination shall be made at the expense of the 
Independent Auditor and may be requested no more than once per year. 
The Independent Auditor, who shall be obligated to confidentiality, 
shall report to Licensor only the amount of royalty payable for the 
period under audit based upon a review of the books and records 
provided. If the Independent Auditor determines that Licensee has 
underpaid the applicable royalties by less than 5% of the total 
applicable royalties for the period in question, Licensee shall pay 
the arrears and interest at a rate of 10% per annum, or the maximum 
allowable interest rate under the applicable state law, if it is 
lower. If the Independent Auditor determines that Licensee has 
underpaid the applicable royalties by greater than 5% of the total 
applicable royalties for the period in question, Licensee shall pay 
the cost of the audit, the arrears, and interest at a rate of 10% 
per annum, or the maximum allowable interest rate under the 
applicable state law, if it is lower.
    3.05. Nothing in this Agreement shall restrict the right of 
Licensor to seek redress for infringement of the [patents to be 
licensed] by Licensee occurring before the date of execution of this 
Agreement.

Article 4--Term and Termination

    4.01. Subject to the terms and conditions hereof, this Agreement 
shall become effective upon execution by both parties and shall 
remain in force for the life of the last licensed patent to expire 
or upon termination. Licensee may terminate this Agreement by giving 
Licensor at least 90 days' prior written notice of termination. 
Licensor may terminate this Agreement immediately, and refuse to 
grant Licensee a new license, if Licensee commits a material breach, 
as defined in Section 4.02 below.
    4.02. Licensor may treat as a material breach: (i) Licensee's 
failure to make a report pursuant to Section 3.01 hereof, or to pay 
corresponding royalties due under such report pursuant to Section 
3.02 hereof, provided that such failure is not cured or resolved 
within 30 days after Licensee received notice thereof; (ii) the 
Independent Auditor's determination, as a result of an audit 
conducted pursuant to Section 3.04 above, that Licensee has 
underpaid the royalties by more than 20% in the applicable period, 
provided that the underpayment is not cured or resolved within 60 
days after Licensee is informed of the determination; (iii) the 
Independent Auditor's determination in two successive audits 
conducted pursuant to Section 3.04 above, that Licensee has 
underpaid the royalties by more than 20% in the applicable period, 
whether or not such

[[Page 13315]]

underpayment is cured; or (iv) Licensee's failure to re-establish 
compliance with its obligations to maintain liability insurance 
under Section 5.10(b) hereof within 60 days of receiving notice from 
Licensor of its non-compliance. The provisions of Section 5.04 
concerning Force Majeure shall apply to the curing or resolution of 
grounds for a material breach.
    4.03. [To be included only in all licenses granted before entry 
of the Final Judgment.] Licensor shall have the option to terminate 
this Agreement if, in the matter United States v. Miller Industries, 
Inc. et al., either of the following events occur: (1) Plaintiff 
withdraws its consent to entry of the proposed Final Judgment, or 
(2) the Court declines to enter the proposed Final Judgment, and the 
time has expired for all appeals from any Court ruling declining 
such entry. Such termination shall be effective 60 days after 
Licensor notifies Licensee of the occurrence of event (1) or (2) 
under this Section 4.03.
    4.04. In the event of termination, Licensee shall report under 
Section 3.01 hereof, and pay under Section 3.02 hereof, royalties on 
all Royalty Bearing Products that it has made or imported prior to 
termination. A terminated Licensee shall have the right at any time 
to sell or otherwise dispose of any Royalty Bearing Product on which 
royalties have been paid. Termination shall not affect Licensee's 
duty to pay royalty obligations hereunder, and shall not affect 
Licensor's right to request an audit covering any period during 
which Licensee has a right hereunder to make or import any product.

Article 5--Miscellaneous Provisions

    5.01. Limitations of Liability and Claims.
    (a) Licensor warrants that is owns the entire right, title, and 
interest to the [patent(s) being licensed] and has the ability to 
license the [patent(s) being licensed] but otherwise neither party 
makes any representations, extends any warranties of any kind, 
either express or implied, and each party specifically disclaims any 
implied warranty of merchantability or fitness for a particular 
purpose in relation to the teachings of the [patent(s) being 
licensed].
    (b) The parties are under no obligation and shall not be 
required under this Agreement to bring or prosecute actions or suits 
against any third party for infringement of the [patent(s) being 
licensed].
    5.02. Relationship of the Parties. The parties shall be 
independent contractors hereunder and neither party shall have the 
power or authority to bind the other party with respect to any third 
party. Except as specifically provided herein, each party shall bear 
its own costs and expenses.
    5.03. Effect of Agreement. This Agreement embodies the entire 
understanding between the parties with respect to the subject matter 
hereof and supersedes any and all prior understandings and 
agreements, oral or written, relating thereto. Any amendment hereof 
must be in writing and signed by both parties.
    5.04. Force Majeure. Each party's performance hereunder is 
subject to interruption or delay due to causes beyond its reasonable 
control such as acts of God, acts of government, war or other 
hostility, the elements, fire, explosion, power failure, equipment 
failure, industrial or labor dispute, and the like. In the event of 
such an interruption or delay, any relevant period of performance of 
the party affected shall be extended for a period of time equal to 
the period of the interruption or delay and any obligation of the 
party whose performance is not affected which corresponds to the 
interrupted or delayed performance shall be suspended for a period 
of time equal to the period of the interruption or delay. Any party 
whose performance hereunder is subject to such interruption or delay 
shall give prompt notice to the other party of the reason or reasons 
for the commencement of and of the conclusion of such interruption 
or delay.
    5.05. Assignment and Successors. This Agreement shall inure to 
the benefit of and be binding upon the parties as well as 
subsidiaries, affiliates, and successors-in-interest of the parties 
hereto. Neither party nor any subsidiary, affiliate or successor-in-
interest shall assign or transfer any of its rights, privileges or 
obligations hereunder without the prior written consent of the other 
party, except that Licensor may, without the consent of Licensee, 
assign this license in connection with the transfer of all or 
substantially all of its towing equipment manufacturing and 
distribution business. Nothing in this Agreement grants, or is 
intended to grant the right or authorization to grant, sublicenses 
of the [patent(s) being licensed]. Upon a permitted assignment of 
this Agreement, said assignee shall expressly agree in writing to be 
bound by all of the provisions of this Agreement. However, nothing 
in this Section shall permit a former licensee of the [patents being 
licensed] who has been terminated for material breach as defined in 
Section 4.02 to exercise any rights under this Agreement.
    5.06. Severability. Should any provision of this Agreement be 
held to be void, invalid, unenforceable or illegal by a court, the 
validity and enforceability of the other provisions shall not be 
affected thereby.
    5.07. Non-Waiver. Failure of either party to enforce any 
provision of this Agreement shall not constitute or be construed as 
a waiver of such provision nor of the right to enforce such 
provision.
    5.08. Notices. In order to be effective, all notices, requests, 
demands, agreements, consents, approvals, permissions and other 
communications required or permitted hereunder shall be in writing, 
shall be delivered personally, faxed, transmitted by courier or 
express service, or mailed, with proper charge prepaid, to the party 
for whom intended as set forth below, and shall be deemed to be 
given upon the date of actual receipt:

To Licensee:
To Licensor: President, Miller Industries, Inc., 8503 Hilltop Drive, 
Ooltewah, TN 37363.
(by other means)

    The sending party shall have the burden of proving receipt. 
Either party may change any address to which notices and other 
communications are to be directed to it by giving notice of such 
change to the other party in the manner provided above.
    5.09. Governing Law. This Agreement shall be governed by and 
construed under the laws of the State of Tennessee.
    5.10. Insurance. During the term of this Agreement, Licensee 
shall maintain broad form general liability insurance, including 
blanket contractual, products and completed operations liability 
coverage, in the amount of two (2) million dollars. Within 30 days 
following execution of this Agreement, Licensee shall deliver to 
Licensor a Certificate of Insurance and, subsequently, any renewals 
thereof evidencing the insurance required by this Paragraph.
    5.11. Patent Marking. Licensee shall mark each Royalty Bearing 
Product made, used, Sold or Otherwise Disposed of under this license 
with the following marking:

Manufactured and sold under license of United States Patent Nos. 
[Patents(s) being licensed].

    5.12. Trademarks and Trade Names. The license herein granted 
conveys no right to Licensee to use or register any trademarks or 
trade names of the Licensor.
    5.13. Preservation of Licensor's Rights. Licensor's grant of 
rights to License pursuant to this Agreement shall in no way 
restrict Licensor's right to manufacture and sell products pursuant 
to the [patent(s) being licensed].
    In witness whereof, the parties have executed this Agreement by 
their authorized representatives.

    [Licensee]
By__------------------------------------------------------------------
Its__-----------------------------------------------------------------
Date__----------------------------------------------------------------

    [Licensor]
By__------------------------------------------------------------------
Its__-----------------------------------------------------------------
Date__----------------------------------------------------------------

Exhibit B: License Agreement

    [Exhibit B to be used for licenses relating to United States 
Patent Number 4,798,509 and United States Patent Number 4,637,623 
(collectively, the ``Improvement Patents''). The ``Alternative'' (in 
italics) relates to terms for licenses of the Improvement Patents 
together with the `737 L-Arm Patent.]
    This License Agreement is made by and 
between____________(``Licensee'') and MILLER INDUSTRIES, INC., or a 
designated subsidiary thereof (and its successors, collectively 
``Licensor'');
    Whereas, Licensor is the owner of United States Patent Number 
4,798,509 and United States Patent Number 4,637,623; [and United 
States Patent Number 4,836,737]
    And whereas, Licensee desires to obtain a license from Licensor 
relating to said patents;
    And whereas, Licensor desires to grant Licensee such a license;
    Now, therefore, in consideration of the foregoing and of the 
mutual covenants which follow, the parties hereby agree that:

Article 1--Definitions

    As used in this Agreement, the following terms shall have the 
following meanings:
    1.01. ``The `737 Patent'' shall mean United States Patent Number 
4,836,737.
    1.02. ``The `623 Patent'' and ``the `509 Patent'' shall mean 
respectively, United States Patent Number 4,637,623 and United

[[Page 13316]]

States Patent Number 4,798,509. (Collectively, the ``Improvement 
Patents'').
    1.03. The ``Licensed Claims'' shall mean only Claims 1-3, 6-10, 
12, 15, 17, 18, 20 and 22 of the `623 Patent and only Claims 1, 4-9, 
11-14 and 16-19 of the `509 Patent. The act of Producing products 
containing (a) a horizontal locking pin device, (b) a vertical 
alignment pin on the receiver used in combination with a horizontal 
locking pin device, or (c) two flat surfaces joined together to form 
a wheel retainer plate, or any combination of (a), (b), or (c), 
shall not constitute an infringement of any unlicensed claim of the 
`623 Patent or the `509 Patent.
    1.04. ``Royalty Bearing Products'' shall mean products made in 
accordance with the Licensed Claims of the `623 Patent or the `509 
Patent. [ALTERNATIVE IF LICENSE IS FOR BOTH--ARM AND IMPROVEMENTS: 
``Royalty Bearing Products'' shall mean products made in accordance 
with any claim or claims of the `737 Patent and the Licensed Claims 
of the `623 Patent or the `509 Patent].
    1.05. ``Independent Auditor'' shall mean a person or persons 
appointed by Licensor subject to the terms and conditions of Section 
IV of the Final Judgment in United States v. Miller Industries, 
Inc., Civ.1:00 CV00305 (D.D.C. 2000).
    1.06. ``Produce,'' ``Producing,'' or ``Production'' means to 
manufacture, make, have made, import into the United States, use, 
offer to sell, sell or otherwise dispose of.

Article 2--License and Related Terms

    2.01. Patent License. During the term of this Agreement, subject 
to the terms and conditions hereof, including, without limitations, 
the timely payment by licensee to the Independent Auditor of the 
license fees provided for in Section 2.02 hereof, Licensor hereby 
grants to Licensee, and Licensee hereby accepts from Licensor, a 
non-exclusive, non-transferable (except as specifically provided in 
Section 5.05 hereof), right and license under the `623 Patent and 
`509 Patent to make, have made, import, use, offer to sell, sell, or 
otherwise dispose of Royalty Bearing Products within the United 
States. This agreement does not provide Licensee with the right to 
make, have made, import, use, offer to sell, sell, or otherwise 
dispose of products that are made in accordance with (i) Claims 4, 
5, 11, 13-14, 16, 19 or 21 of the `623 Patent; (ii) Claims 2, 3, 10 
or 15 of the `509 Patent; or (iii) any claim of the `737 Patent.
    2.02. Royalties. In consideration of the license granted under 
Section 2.01 hereof, Licensee shall pay Licensor a royalty of $____ 
per unit \1\ for each Royalty Bearing Product Sold or Otherwise 
Disposed of by or for Licensee. The term ``Sold or Otherwise 
Disposed of'' includes Royalty Bearing Products sold, leased, placed 
in commercial service, or delivered by or on behalf of Licensee 
within the United States. In no event shall a Licensee pay more than 
one royalty on a single unit of Royalty Bearing Product.
---------------------------------------------------------------------------

    \1\ The royalty shall not exceed $150 per unit, adjusted up or 
down annually in accordance with the change in the U.S. Department 
of Labor Producer Price Index for Finished Goods.
---------------------------------------------------------------------------

Article 2--License and Related Terms

[ALTERNATIVE: LICENSE FOR L-ARM PLUS IMPROVEMENT PATENTS]

    2.01. Patent License. During the term of this Agreement, subject 
to the terms and conditions hereof, including, without limitations, 
the timely payment by Licensee to the Independent Auditor of the 
license fees provided for in Section 2.02 hereof, Licensor hereby 
grants to Licensee, and Licensee hereby accepts from Licensor, non-
exclusive, non-transferable (except as specifically provided in 
Section 5.05 hereof), right and license under the `737 Patent, `623 
Patent and `509 Patent to make, have made, import, use offer to 
sell, sell, or otherwise dispose of Royalty Bearing Products within 
the United States. This agreement does not provide Licensee with the 
right to make, have made, import, use, offer to sell, sell, or 
otherwise dispose of products that embody or are made in accordance 
with Claims 4, 5, 11, 13-14, 16, 19 or 21 of the `623 Patent or 
Claims 2, 3, 10 or 15 of the `509 Patent.
    2.02. Royalties. In consideration of the license granted under 
Section 2.01 hereof, Licensee shall pay Licensor a royalty of $____ 
per unit \2\ for each Royalty Bearing Product Sold or Otherwise 
Disposed of by or for Licensee.. The term ``Sold or Otherwise 
Disposed of'' includes Royalty Bearing Products sold, leased, placed 
in commercial service, or delivered by or on behalf of Licensee 
within the United States. In no event shall a licensee pay more than 
one royalty on a single unit of Royalty Bearing Product.
---------------------------------------------------------------------------

    \2\ The royalty shall not exceed $175 per unit, adjusted up or 
down annually in accordance with the change in the U.S. Department 
of Labor Producer Price Index for Finished Goods.
---------------------------------------------------------------------------

Article 3--Notice Provisions

    3.01. Licensee shall make written reports to the Independent 
Auditor within 30 days of the end of each calendar quarter through 
the life of each patent to be licensed, stating in each such report 
the aggregate number of Royalty Bearing Products it has Sold or 
Otherwise Disposed of within the United States during such calendar 
quarter and upon which royalty is payable as provided in this 
Agreement. The first such report shall include all Royalty Bearing 
Products Licensee has Sold or Otherwise Disposed of between the date 
of this Agreement and the date of such report. The Independent 
Auditor shall report to the Licensor only such information as is 
permitted under Paragraph IV.C of the Final Judgment in  United 
States v. Miller Industries, Inc., et al., Civ. 1:00 CV00305 (D.D.C. 
2000).
    3.02. Concurrently with each report, Licensee shall pay to the 
Independent Auditor royalties as the rate specified in Article 2.02 
of this Agreement on the Royalty Bearing Products included in the 
report.
    3.03 Licensee shall keep accurate books and records in 
accordance with accepted accounting practices showing the Royalty 
Bearing Products it made, had made, imported, used, offered for 
sale, Sold or Otherwise Disposed of during the life of this License 
Agreement. Such records shall be in sufficient detail to enable the 
royalties payable to Licensor to be determined.
    3.04. The Independent Auditor shall notify Licensor when, in his 
or her independent judgment, an audit is appropriate, and upon 
Licensor's approval shall conduct an audit. Upon request of the 
Independent Auditor, Licensee will permit its books and records 
pertinent to the determination of the royalties payable to Licensor 
to be examined to the extent reasonably necessary for the 
Independent Auditor to verify the reports provided by Licensee. In 
the event that the Auditor shall have questions that appear not to 
be answered by such books and records, the Auditor shall have the 
right to confer with representatives of the Licensee, including but 
not limited to the Licensee's Chief Financial Officer and Plant 
Manager. Such examination shall be made at the expense of the 
Independent Auditor and may be requested no more than once per year. 
The Independent Auditor, who shall be obligated to confidentiality, 
shall report to Licensor only the amount of royalty payable for the 
period under audit based upon a review of the books and records 
provided. If the Independent Auditor determines that Licensee has 
underpaid the applicable royalties by less than 5% of the total 
applicable royalties for the period in question, Licensee shall pay 
the arrears and interest at a rate of 10% per annum, or the maximum 
allowable interest rate under the applicable state law if it is 
lower. If the Independent Auditor determines that Licensee has 
underpaid the applicable royalties by greater than 5% of the total 
applicable royalties for the period in question, Licensee shall pay 
the cost of the audit, the arrears, and interest at a rate of 10% 
per annum. or the maximum allowable interest rate under the 
applicable state law, if it is lower.
    3.05 Nothing in this Agreement shall restrict the right of 
Licensor to seek redress for infringement of the [patents to be 
licensed] by licensee occurring before the date of execution of this 
Agreement.

Article 4--Term and Termination

    4.01. Subject to the terms and conditions hereof, this Agreement 
shall become effective upon execution by both parties and shall 
remain in force for the life of the last licensed patent to expire 
or upon termination. Licensee may terminate this Agreement by giving 
Licensor at least 90 days' prior written notice of termination. 
Licensor may terminate this Agreement immediately, and refuse to 
grant Licensee a new license, if Licensee commits a material breach, 
as defined in Section 4.02 below.
    4.02. Licensor may treat as a material breach: (1) Licensee's 
failure to make a report pursuant to Section 3.01 hereof, or to pay 
corresponding royalties due under such report pursuant to Section 
3.02 hereof, provided that such failure to not cured or resolved 
within 30 days after Licensee receives notice thereof; (ii) the 
Independent Auditor's determination, as a result of an audit 
conducted pursuant to Section 3.04 above, that Licensee has 
underpaid the royalties by more than 20% in the applicable period, 
provided that the underpayment is

[[Page 13317]]

not cured or resolved within 60 days after Licensee is informed of 
the determination; (iii) the Independent Auditor's determination in 
two successive audits conducted pursuant to Section 3.04 above, that 
Licensee has underpaid the royalties by more than 20% in the 
applicable period whether or not such underpayment is cured; or (iv) 
Licensee's failure to re-establish compliance with its obligations 
to maintain liability insurance under Section 5. 10(b) hereof within 
60 days of receiving notice from Licensor of its non-compliance. The 
provisions of Section 5.04 concerning Force Majeure shall apply to 
the curing or resolution of grounds for a material breach.
    4.03. [To be included only in all licenses granted before entry 
of the Final Judgment.] Licensor shall have the option to terminate 
this Agreement if, in the matter United States v. Miller Industries, 
Inc. et al., either of the following events occur: (1) Plaintiff 
withdraws its consent to entry of the proposed Final Judgment, or 
(2) the Court declines to enter the proposal Final Judgment, and the 
time has expired for all appeals from any Court ruling declining 
such entry. Such termination shall be effective 60 days after 
Licensor notifies License of the occurrence of event (1) or (2) 
under this Section 4.03.
    4.04. In the event of termination, License shall report under 
Section 3.01 hereof, and pay under Section 3.02 hereof, royalties on 
all Royalty Bearing Products that it has made or imported prior to 
termination. A terminated Licensee shall have the right at any time 
to sell or otherwise dispose of any Royalty Bearing Product on which 
royalties have been paid. Termination shall not affect Licensee's 
duty to pay royalty obligations hereunder, and shall not affect 
Licensor's right to request an audit covering any period during 
which Licensee has a right hereunder to make or import any product.

Article 5--Miscellaneous Provisions

    5.01. Limitations of Liability and Claims.
    (a) Licensor warrants that it owns the entire right, title, and 
interest to the [patent(s) being licensed] and has the ability to 
license the [patent(s) being licensed] but otherwise neither party 
makes any representations, extends warranties of any kind, either 
express or implied, and each party specifically disclaims any 
implied warranty of merchantability or fitness for a particular 
purpose in relation to the teachings of the [patent(s) being 
licensed].
    (b) The parties are under no obligation and shall not be 
required under this Agreement to bring or prosecute actions or suits 
against any third party for infringement of the [patent(s) being 
licensed].
    (c) Licensor warrants that, should Licensee (in its own 
discretion) obtain an ``Approved Proposed Design'' from the 
Designated Expert pursuant to Section IV of the Final Judgment in 
United States v. Miller Industries, Licensor will not challenge as 
infringement of any unlicensed claim of the `509 or `623 Patents the 
Licensee's production of products made in accordance with the 
specifications of an Approved Proposed Design.
    5.02 Relationship of the Parties. The parties shall be 
independent contractors hereunder and neither party shall have the 
power or authority to bind the other party with respect to any third 
party. Except as specifically provided herein, each party shall bear 
its own costs and expenses.
    5.03. Effect Agreement. This Agreement embodies the entire 
understanding between the parties with respect to the subject matter 
hereof and supersedes any and all prior understandings and 
agreements, oral or written, relating thereto. Any amendment hereof 
must be in writing and signed by both parties.
    5.04. Force Majeure. Each party's performance hereunder is 
subject to interruption or delay due to causes beyond its reasonable 
control such as acts of God, acts of government, war or other 
hostility, the elements, fire, explosion, power failure, industrial 
or labor dispute, and the like. In the event of such an interruption 
or delay, any relevant period of performance of the party affected 
shall be extended for a period of time equal to the period of the 
interruption or delay and any obligation of the party whose 
performance is not affected which corresponds to the interrupted or 
delayed performance shall be suspended for a period of time equal to 
the period of the interruption or delay. Any party whose performance 
hereunder is subject to interruption or delay shall give prompt 
notice to the other party of the reason or reasons for the 
commencement of and of the conclusion of such interruption or delay.
    5.05. Assignment and Successors. This Agreement shall inure to 
the benefit of and be binding upon the parties as well as 
subsidiaries, affiliates, and successors-in-interest of the parties 
hereto. Neither party nor any subsidiary, affiliate or successor-in-
interest shall assign or transfer any of its rights, privileges or 
obligations hereunder without the prior written consent of the other 
party, except that Licensor may, without the consent of Licensee, 
assign this license in connection with the transfer of all or 
substantially all of its towing equipment manufacturing and 
distribution business. Nothing in this Agreement grants, or is 
intended to grant the right or authorization to grant, sublicenses 
of the [patent(s) being licensed]. Upon a permitted assignment of 
this Agreement, said assignee shall expressly agree in writing to be 
bound by all of the provisions of this Agreement. However, nothing 
in this Section shall permit a former licensee of the [patents being 
licensed] who has been terminated for material breach as defined in 
Section 4.02 to exercise any rights under this Agreement.
    5.06. Severability. Should any provision of this Agreement be 
held to be void, invalid unenforceable or illegal by a court, the 
validity and enforceability of the other provisions shall not be 
affected thereby.
    5.07. Non-Waiver. Failure of either party to enforce any 
provision of this Agreement shall not constitute or be construed as 
a waiver of such provision nor of the right to enforce such 
provision.
    5.08. Notices. In order to be effective, all notices, requests, 
demands, agreements, consents, approvals, permissions and other 
communications required or permitted hereunder shall be in writing, 
shall be delivered personally, faxed, transmitted by courier or 
express service, or mailed, with proper charge prepaid, to the party 
for whom intended as set forth below, and shall be deemed to be 
given upon the date of actual receipt:
To Licensee:
To Licensor: President, Miller Industries, Inc., 8503 Hilltop Drive, 
Ooltewah, TN 37363.
(by other means)

    The sending party shall have the burden of proving receipt. 
Either party may change any address to which notices and other 
communications are to be directed to it by giving notice of such 
change to the other party in the manner provided above.
    5.09 Governing Law. This Agreement shall be governed by and 
construed under the laws of the State of Tennessee.
    5.10. Insurance. During the term of this Agreement, Licensee 
shall maintain broad form general liability insurance, including 
blanket contractual, products and completed operations liability 
coverage, in the amount of two (2) million dollars. Within 30 days 
following execution of this Agreement, Licensee shall deliver to 
Licensor a Certificate of Insurance and, subsequently, any renewals 
thereof evidencing the insurance required by this Paragraph.
    5.11. Patent Marking. Licensee shall mark each Royalty Bearing 
Product made, used, Sold or Otherwise Disposed of under this license 
with the following marking:

Manufactured and sold under license of United States Patent Nos. 
[Patent(s) being licensed].

    5.12. Trademarks and Trade Names. The license herein granted 
conveys no right to Licensee to use or register any trademarks or 
trade names of the Licensor.
    5.13. Preservation of Licensor's Rights. Licensor's grant of 
rights to Licensee pursuant to this Agreement shall in no way 
restrict Licensor's right to manufacture and sell products pursuant 
to the [patent(s) being licensed].
    In witness whereof, the parties have executed this Agreement by 
their authorized representatives.

    [Licensee]
By---------------------------------------------------------------------
Its--------------------------------------------------------------------
Date-------------------------------------------------------------------

    [Licensor]
By---------------------------------------------------------------------
Its--------------------------------------------------------------------
Date-------------------------------------------------------------------

Exhibit C: Notification of Available Licenses

    Miller Industries, Inc. and Miller Industries Towing Equipment, 
Inc. (``Miller Industries'') have consented to the entry of the 
attached proposed Final Judgment to resolve a civil suit brought by 
the Antitrust Division of the Department of Justice. Under the 
proposed Final Judgment, Miller Industries is required to offer to 
any third party a non-exclusive license to make and sell products 
covered by one or more of the following United States Patents. Terms 
and maximum unit royalty rates for such licenses are specified below 
and in greater detail in Exhibit A to the Final Judgment:


[[Page 13318]]


No. 4,836,737 (the '737 Patent, also known as the L-Arm Patent): 
$125.00
No. 5,061,147 (the '147 Patent, also known as the ``Independent 
Raise-and-Lower Patent''): $150.00
No. 5,628,609 (the '609 Patent, also known as the ``Backsaver'' 
Patent): $150.00
The L-Arm and the Independent Raise-and-Lower Patents, together: 
$175.00
The L-Arm and the Backsaver Patents, together: $175.00

    The proposed Final Judgment also requires Miller Industries to 
offer to any third party a non-exclusive license to certain 
improvements in the L-Arm, wheel lift designs covered by United 
States Patent Nos. 4,637,623 and 4,798,509 (respectively the '623 
and '509 Patents, also known as the ``Improvement Patents''). Miller 
Industries will license the features under these Improvement Patents 
that allow the L-Arm wheel lift to pivot horizontally and 
vertically. Terms and maximum unit royalty rates for such licenses 
are specified below and in greater detail in Exhibit B to the Final 
Judgment:

Licensed Claims of the Improvement Patents: $150.00
Licensed Claims of the Improvement Patents and the L-Arm Patent, 
together: $175.00

    These Improvement Patents ('623 and '509), originally owned by 
Vulcan International, Inc., embody improvements to the L-Arm wheel 
lift found on Vulcan products. Under the terms of this license, 
licensees will be able to use all features covered by the 
Improvement Patents (such as the horizontal and vertical pivoting of 
the L-arms) except for three features: (1) The vertical locking pin 
device, (2) the elongated curved wheel retainer plate, and (3) the 
wheel lift receiver placed completely above the cross bar.
    Licensees under the Licensed Claims of the Improvements Patents 
will be able to make and sell many wheel lift devices covered by the 
claims being licensed, including Miller Industries' Century design, 
drawings of which are attached as Exhibits D and E to the Final 
Judgment. Licensees under the Licensed Claims of the Improvement 
Patents may also develop and produce their own independent designs, 
so long as these do not include the three patented features 
mentioned above that are not being licensed.

BILLING CODE 4410-11-M

[[Page 13319]]

[GRAPHIC] [TIFF OMITTED] TN13MR00.004


[[Page 13320]]


[GRAPHIC] [TIFF OMITTED] TN13MR00.005

BILLING CODE 4410-11-C

[[Page 13321]]

    If they want additional assurance that Miller Industries cannot 
charge their independent designs with infringement of the Unlicensed 
Claims of the Improvement Patents, licensees may, before marketing a 
product incorporating their independent design, elect to obtain a 
determination by an independent expert. Miller Industries will pay 
for the time that it takes the independent expert to become familiar 
with the Improvement Patents, and the licensee will pay for the 
expert's time required, after his/her familiarization, to make the 
determination. The independent expert's determination that a design 
is covered by the license under the Improvement Patents will be 
binding on Miller Industries. The independent expert will be 
required to keep the licensee's request for a determination, and the 
design for which the determination is requested, confidential from 
Miller Industries until the licensee begins selling products based 
on the design approved by the independent expert.
    Section IV of the Final Judgment describes the requirements for 
these licenses. The licenses are available now and will continue to 
be available throughout the ten-year life of the Final Judgment. The 
licenses are uncancelable by Miller Industries during the life of 
the licensed patents, except on the ground of material breach (for 
instance, for non-payment of royalties), and in the unanticipated 
event that the Court declines to enter the proposed Final Judgment. 
In the event of license cancellation, a licensee will retain the 
right to sell at any time licensed products manufactured pursuant to 
the terms of the license.
    Please contact Mr./Ms. ____________ at Miller Industries [phone 
number] if you are interested in obtaining a license.

Competitive Impacts Statement

    The United States, pursuant to Section 2(b) of the Antitrust 
Procedures and Penalties Act (``APPA''), 15 U.S.C. Sec. 16(b)-(h), 
files this Competitive Impact Statement relating to the proposed Final 
Judgment submitted for entry in this civil antitrust proceeding.

I. Nature and Purpose of the Proceeding

    On February 17, 2000, the United States filed a civil antitrust 
Complaint in this Court charging that Defendant Miller Industries, 
Inc., violated Section 7 of the Clayton Act, 15 U.S.C. 18, when it 
acquired ownership of two horizontal competitors, Vulcan Equipment, 
Inc. (``Vulcan'') and Chevron, Inc. (``Chevron''). Miller Industries 
acquired Vulcan in September 1996 and acquired Chevron in December 
1997.
    The Complaint charges that these acquisitions substantially 
lessened competition in the markets for the design, manufacture, and 
sale of the two major categories of towing and recovery vehicles 
generally used to service passenger cars and light trucks in the United 
States: light-duty towtrucks and light-duty car carriers. Prior to 
their acquisition, Vulcan and Chevron were proven innovators that had 
patented and successfully marketed key functional improvements in 
light-duty towtrucks and light-duty car carriers, and were two of the 
three most significant competitors faced by Miller Industries \1\ in 
these markets. The acquisitions eliminated head-to-head competition 
that benefitted consumers, establishing Miller Industries as the 
dominant firm in the light-duty towtruck and light-duty car carrier 
markets with the ability unilaterally to raise prices or reduce 
quality. The acquisitions also increased Miller Industries' ownership 
of valuable patent rights, and reduced the number of firms with the 
right to offer towing and recovery vehicles incorporating the important 
technology covered by those patents. Finally, by reducing the number of 
competitors, these acquisitions increased the likelihood of 
anticompetitive coordinated behavior to raise prices or reduce quality.
---------------------------------------------------------------------------

    \1\ When used herein, the term ``Miller Industries'' refer to 
any one or more of the defendants.
---------------------------------------------------------------------------

    The request for relief in the Complaint seeks: (1) A judgment that 
the acquisitions violate Section 7 of the Clayton Act; (2) injunctive 
or other appropriate relief to restore competition; (3) an award of 
costs to the Government; and (4) such other relief as the Court may 
deem just proper.
    Shortly before the Complaint was filed, the parties reached a 
proposed settlement that would substantially restore competition in the 
United States light-duty towtruck and light-duty car carrier markets, 
primarily by requiring Miller Industries to grant a non-exclusive 
license to use certain items of important patented technology to any 
third party that requests such a license.
    Along with the Complaint, the parties filed a Stipulation and 
proposed Final Judgment setting out the terms of the settlement. 
Pursuant to the obligations imposed in these documents, beginning 
within ten days of the time that they are filed with the Court, Miller 
Industries must offer to any third party a non-exclusive license under 
as many as five different patents. The proposed Final Judgment 
specifies the maximum unit royalties payable under these compulsory 
licenses, and also contains model licenses setting forth other terms. 
Miller Industries is required to continue to offer these licenses 
during the ten-year life to the proposed Final Judgment. the licenses 
are not cancelable by Miller Industries during the life of any licensed 
patent, unless the licensee commits a material breach as defined in the 
license (e.g., non-payment of royalties), or the proposed Final 
Judgment is not entered by the Court. The proposed Final Judgment also 
requires Miller Industries to notify the Government prior to making 
future acquisitions of competitive assets valued above a certain dollar 
amount.
    The plaintiff and defendants have stipulated that the Court may 
enter the proposed Final Judgment after compliance with the APPA, 
unless the plaintiff has theretofore withdrawn its consent. Entry of 
the proposed Final Judgment would terminate this action, except that 
the Court would retain jurisdiction to construe, modify, or enforce 
provisions of the proposed Final Judgment and punish violations 
thereof.

II. Description of Events Giving Rise to the Alleged Violation

A. The Defendants and the Illegal Transactions
    Defendant Miller Industries, Inc. is a Tennessee corporation. Its 
wholly owned subsidiary, Miller Industries Towing Equipment, Inc., is a 
Delaware corporation. Both maintain their principal place of business 
in Ooltewah, Tennessee. Defendant Chevron, a wholly owned subsidiary of 
Defendant Miller Industries, Inc., is a Pennsylvania corporation with 
its principal place of business in Mercer, Pennsylvania.
    Miller Industries designs, manufactures, and markets many well 
known brands of light-duty towtrucks and light-duty car carriers, 
including those carrying the Century, Vulcan, Chevron, Holmes, 
Challenger, and Champion brands.
    On September 2, 1996, Defendant Miller Industries, Inc., acquired, 
in exchange for shares of its capital stock having an approximate value 
of $8.2 million, all of the outstanding capital stock of Vulcan, one of 
its major competitors in the design, manufacture, and sale of light-
duty towtrucks and light-duty car carriers, thereby obtaining control 
of Vulcan's assets, including several patents of great competitive 
value in the light-duty towtruck and light-duty car carrier markets. 
The transaction was not subject to the notification requirements of the 
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 
U.S.C. 18a, (``HSR Act'') because the dollar value of the transaction 
was below $15 million.
    Miller Industries continues to market products under the Vulcan 
label, but Vulcan's production facilities have been dismantled and its 
operations integrated with those of Miller Industries. Title to the 
patents formerly owned by Vulcan has passed to Defendant Miller 
Industries Towing Equipment, Inc.

[[Page 13322]]

    On December 5, 1997, Defendant Miller Industries, Inc. acquired, 
for $10 million cash, all of the capital stock of Chevron, another of 
its major competitors in the design, manufacture, and sale of light-
duty towtrucks and light-duty car carriers, thereby obtaining control 
of Chevron's assets, including valuable patents in the light-duty 
towtruck and light-duty car carrier markets. This transaction also was 
not subject to the notification requirements of the HSR Act. Although 
many of Chevron's functions have now been integrated with Miller 
Industries, Defendant Chevron, Inc. survives as a wholly owned Miller 
Industries subsidiary and continues as the owner of record of the 
patents it held before its acquisition.
B. Product and Geographic Markets
    Light-duty towtrucks and light-duty car carriers are the principal 
types of vehicles used by towing companies, garages, and other towing 
service providers in the United States to recover and transport 
immobilized or unattended illegally parked passenger cars and light 
trucks. Manufacturers design, construct, and assemble specialized 
equipment components, such as booms, winches, and bed-tilting 
mechanisms, for mounting on standard truck chassis supplied by 
automotive suppliers such as GM, Ford, Dodge, or Navistar. The 
installed price of the equipment used to construct a light-duty to 
towtruck is generally between twelve to fifteen thousand dollars, and 
between eleven and fourteen thousand dollars for a light-duty car 
carrier.
    Towing and recovery vehicle fleets generally include both light-
duty towtrucks and light-duty car carriers because each possesses 
characteristics that make it more efficient than the other in certain 
situations. Light-duty towtrucks, which lift a disabled vehicle by its 
front or back tires to tow it, maneuver better in confined spaces such 
as parking garages and narrow city streets and are generally more 
effective in difficult recovery situations. Light-duty car carriers 
have flat beds that can be titled to permit a disabled vehicle to be 
winched up onto the truck bed and carried. Light-duty car carriers are 
preferred for removing vehicles that are particularly susceptible to 
damage, and are generally more efficient in transporting a disabled 
vehicle over substantial distances. Also, a light-duty car carrier may 
be equipped with an ``underlift'' that permits it to tow a second 
vehicle in addition to the one on its bed, enabling it to remove two 
disabled vehicles simultaneously.
    Removal and recovery of larger disabled vehicles, such as buses, 
heavy trucks, or construction equipment, requires the service of larger 
and more powerful vehicles, which also generally have different 
equipment. These heavier removal and recovery vehicles also cost more 
to purchase and operate.
    Because of the distinct characteristics of light-duty towtrucks and 
light-duty car carriers, respectively, prospective buyers would not 
respond to a small but significant increase in the price of either one 
by substituting the other, or by substituting any other type of towing 
and recovery vehicle. Light-duty towtrucks and light-duty car carriers 
each comprises a separate relevant product market and, as there is no 
significant importation, the United States comprises the relevant 
geographic market in which the competitive effects of these 
acquisitions must be assessed.
C. Patent Barriers
    Miller Industries owned valuable patented technology prior to its 
acquisitions of Vulcan and Chevron, and acquired additional important 
patents when it acquired these two companies. These patent rights 
relate to: (1) Improved wheel lift design technology, and (2) the 
``independent raise and lower'' (``IRL'') technology.
1. The Wheel-Lift Patents
    A wheel lift is a device mounted on the rear end of a light-duty 
towtruck or light-duty car carrier that cradles and supports from 
beneath the front or back tires of a disabled vehicle in order to apply 
the lifting power required to raise it into towing position, and to tow 
it. Nearly a decade ago, Miller Industries acquired the patents rights 
to a greatly improved wheel lift design called the L-Arm Wheel Lift 
(U.S. Patent No. 4,836,737) when it acquired Century Wrecking Company. 
Century had previously granted a paid-up royalty license under this 
patent to competitor Jerr-Dan Corporation.
    Before being acquired by Miller Industries, Vulcan had invented 
significant improvements to the basic patented L-Arm Wheel Lift, and 
obtained the ``Vulcan Improvement Patents'' (U.S. Patent Nos. 4,637, 
623 and 4,798,509). The key features of these improvements allow the L-
Arm device to pivot both horizontally and vertically, providing for 
easier deployment of the wheel lift. Miller Industries and Vulcan 
entered into a cross license agreement under which Vulcan obtained a 
license under Miller Industries' L-Arm patent and Miller Industry 
obtained a license to use the most significant features of the Vulcan 
Improvement patents.
    There is no established, commercially available alternative to the 
L-Arm or the Vulcan Improvement Patents. Prior to Miller Industries' 
acquisition of Vulcan, three competitors (Miller Industries, Jerr-Dan, 
and Vulcan) had the right to compete with products incorporating the L-
Arm wheel lift, and two (Miller Industries and Vulcan) had the right 
also to compete with products incorporating the most significant 
features of the Vulcan Improvement Patents. Vulcan reserved for itself 
the exclusive rights to other features of the improvements, such as the 
use of a vertical looking pin device and the elongated curved plate.
    Chevron, lacking rights to the above-described patents, in an 
effort to design around them, developed and obtained Patent No. 
5,628,609 on the ``Backsaver'' wheel lift. Miller Industries 
nevertheless sued Chevron and charged that this Backsaver design 
infringed its L-Arm patent, but Miller Industries acquired Chevron 
before this issue was adjudicated.
2. The IRL Patent
    A light-duty car carrier can be equipped with an ``underlift,'' 
that is a wheel lift (which can be, but need not be, an L-Arm wheel 
lift) mounted on its back end that can be used to tow another disabled 
vehicle once one disabled vehicle has been loaded atop its bed. Prior 
to its acquisition by Miller Industries, Chevron had developed and 
patented a greatly improved design for mounting a wheel lift as an 
underlift on a light-duty car carrier so that it could be raised into 
towing position, and lowered from it, independently of the tilting 
truck bed. The right to use this IRL feature (covered by U.S. Patent 
No. 5,061,147), which significantly facilitates removal and 
transportation of two vehicles simultaneously by a light-duty car 
carrier, is a substantial benefit to competitors in the United States 
light-duty car carrier market. Designing around the patent is 
difficult, time consuming, and expensive.
D. Harm to Competition as a Consequence of the Merger
    Even before it acquired Vulcan and Chevron, Miller Industries was 
the nation's largest supplier of light-duty towtrucks and the second 
largest supplier of light-duty car carriers, with 45% and 23% shares of 
total revenues in those markets, respectively. With these acquisitions, 
Miller increased its market shares dramatically, so that after the 
acquisitions it accounted for approximately 73% of total revenues for

[[Page 13323]]

U.S. sales of light-duty towtrucks and about 47% of total revenues for 
U.S. sales of light-duty car carriers, and significantly increased 
concentration in both markets. As measured by the commonly used 
Herfindahl-Hirschman Index (HHI),\2\ concentration of the light-duty 
towtruck market, which stood at an HHI of about 2650 before these 
acquisitions, rose by about 3000 points to an HHI of about 5650 after 
the acquisitions. Concentration of the light-duty car carrier market, 
which stood at an HHI of about 2380 before these acquisitions, rose by 
about 1200 points to an HHI of about 3580 after the acquisitions.
---------------------------------------------------------------------------

    \2\ A definition and explanation of HHI is provided in Appendix 
A to the Complaint.
---------------------------------------------------------------------------

    Miller Industries' acquisitions of Vulcan and Chevron also 
eliminated two significant and effective competitors, both of which had 
successfully developed and marketed valuable innovations in product 
design that had provided Miller Industries' products with important 
competition, and both of which would likely have continued to innovate 
had they remained independent. The acquisitions also reduced the number 
of firms able to offer products incorporating the L-Arm wheel lift and 
the most competitively significant features of the Vulcan Improvement 
Patents, and substantially increased Miller Industries' ownership of 
patent rights important for effective competition in the light-duty 
towtruck and light-duty car carrier markets. Miller Industries now 
faces competition in these markets from only one large competitor and a 
number of small firms.
    As a result of the acquisitions, Miller Industries became the 
dominant firm in the light-duty towtruck and light-duty car carrier 
markets with the ability unilaterally to raise prices or reduce 
quality. In addition, by reducing the number of competitors, these 
acquisitions increased the likelihood of anticompetitive coordinated 
behavior to raise prices or reduce quality.
    Successfull entry is difficult and unlikely, in large part because 
the L-Arm as well as other patented wheel lift designs owned by Miller 
Industries are critical for effective competition in both of these 
markets. It would take a new entrant considerable time, expenditure, 
and effort to develop product designs that did not infringe Miller 
Industries' patents--if it could be done at all--as well as establish 
the necessary distribution network and gain customer acceptance of its 
products.

III. Explanation of the Proposed Final Judgment

    The proposed Final Judgment is designed to eliminate the 
anticompetitive effects of Miller Industries' acquisitions of Vulcan 
and Chevron, primarily by requiring compulsory licensing of the above-
described patents to any present competitor or entrant at reasonable 
royalties.
A. Patent Licenses
    The proposed Final Judgment directs Miller Industries to offer, 
until the expiration of the ten-year term of the decree, to any third 
party requesting it a non-exclusive license for any one or more of: (1) 
The L-Arm patent, (2) certain specified claims of the Vulcan 
Improvement Patents, that allow the L-Arm to pivot horizontally and 
vertically, (3) the Backsaver patent, and (4) the IRL patent.
    All licenses will be uncancelable by Miller Industries until the 
last of the licensed patents has expired, unless the licensee 
materially breaches (as defined in the license, e.g., for non-payment 
of royalties) its terms.
    The proposed Final Judgment requires Miller Industries to retain 
the services of an Independent Auditor to collect royalty payments and 
provide Miller Industries with the Payments along with reports that do 
not disclose competitively sensitive sales information about a 
licensee.
    Licenses will be for the full subject matter scope of the L-Arm, 
Backsaver, IRL patents, and for specified claims of the Vulcan 
Improvement Patents (the ``Licensed Claims''). These Licensed Claims 
cover the horizontal and vertical pivoting features and are the claims 
that Vulcan had licensed to Miller Industries before Vulcan was 
acquired. The claims of the Vulcan Improvement Patents that are not 
licensed (the ``Unlicensed Claims'') are also specified and described 
in the Final Judgment. These cover the same features that, prior to its 
acquisition by Miller Industries, Vulcan had reserved for its own 
exclusive use.
    To clarify the features covered by the Licensed Claims, and to 
facilitate the production by licensees of wheel lifts embodying these 
features, the proposed Final Judgment makes clear that the wheel lift 
design now used in Miller Industries' Century model towtruck is covered 
by the Licensed Claims and its not precluded from licensees' use by the 
Unlicensed Claims. The engineering drawings for the Century model wheel 
lift design are appended to the proposed Final Judgment as Exhibits D 
and E.
    The Proposed Final Judgment also includes another option to 
facilitate licensing of the Licensed Claims and promote product 
innovation. Licensees that wish to incorporate the features of the 
Licensed Claims into their own wheel lift designs--rather than use the 
Century model design--may seek assurance that their designs fall within 
the Licensed Claims and do not infringe the Unlicensed Claims. Miller 
Industries shall retain a Designated Expert, to be selected at the sole 
discretion of the Government, who will at the request of an existing or 
prospective licensee, determine whether a licensee's proposed design 
falls within Licensed Claims. Miller Industries will be bound by a 
determination by the Designated Expert that a design falls within the 
Licensed Claims and will not subsequently challenge that design as an 
infringement of any Unlicensed Claim of the Vulcan Improvement Patents. 
The proposed Final Judgment provides that Miller Industries will pay, 
up to a specified maximum amount, the cost for the Designated Expert to 
review the licensed patents and gain sufficient familiarity to be able 
to assess specific design proposals offered by licensees. Any licensee 
that opts for such a determination will bear the additional cost of the 
Designated Expert's determination regarding its particular design. The 
proposed Final Judgment imposes requirements designed to assure that 
information about the proposed design remains confidential with the 
Designated Expert until products embodying the design are actually 
sold.
    Each licensee and prospective licensee under the Vulcan Improvement 
patents may use the services of the Designated Expert, but no one is 
required to use them. Miller Industries is required to grant each 
request for a license, and a licensee of the Licensed Claims may choose 
simply to design and market its product. Of course, a licensee choosing 
this option would not be protected against the risk of a possible claim 
of infringement and the costs inherent therein.
    The proposed Final Judgment is intended to restore competition and 
promote further innovation in the markets for light-duty towtrucks and 
light-duty car carriers. This will benefit customers by providing them 
with lower prices, better quality, and a greater variety of products. 
The L-Arm, the Licensed Claims of the Vulcan Improvements, the IRL 
patent, and the Backsaver Patent are important for effective 
competition in the markets for light-duty towtrucks and car carriers. 
Licensing these designs will also lower entry barriers and allow many 
firms to

[[Page 13324]]

offer products with these important features.
    The proposed Final Judgment requires broad licensing to promote the 
wide dispersion and use of this intellectual property. This licensing, 
offered to all firms now in the industry and to firms that may enter in 
the future, will likely enable small firms to become more effective 
competitors, will likely lessen Miller Industries' market dominance, 
and will substantially ease entry barriers in the future. Broad 
licensing and use of the intellectual property, now concentrated in 
Miller Industries' hands, will promote further innovation and 
improvements in light-duty towtruck and light-duty car carrier 
technology. Given the configuration of the markets here, and the fact 
that these acquisitions were completed some years ago, the broad 
licensing scheme required by the proposed Final Judgment is the most 
effective form of relief in this case and offers the prospect of 
substantially increasing competition in the affected markets.
    Since the decree requires Miller to license all comers during the 
term of the decree for the life of the patents, it was necessary to 
prevent Miller from exercising market power over the price or terms of 
such licenses or from delaying, through lengthy negotiations, 
implementation of the compulsory licensing requirement. Therefore, the 
decree requires that licenses be at reasonable royalty rates not to 
exceed certain maximum amounts and contains model licenses that set 
forth the basic terms. However, the decree allows Miller Industries and 
a licensee to reach a mutual agreement to lower royalty rates or to 
vary other license terms.
B. Notification of Future Acquisitions
    The proposed Final Judgment also requires Miller Industries to 
notify the Department of Justice prior to acquiring any assets of or 
interest in a manufacturer of towing and recovery equipment, or any 
patent relating to the manufacture of towing and recovery equipment, 
when the value of the acquisition is over $5 million. This provision 
supplements the statutory notification provisions of the HSR Act, under 
which parties generally need not file a notification if the dollar 
value of their transaction is below $15 million. This decree provision 
was included because the acquisitions of Vulcan and Chevron lessened 
competition even though the dollar value of these transactions fell 
below the HSR Act's notification threshold. It will give the Department 
of Justice the opportunity to assess, before the acquisitions are 
consummated, the likely competitive effects of any future Miller 
Industries' asset acquisitions greater than $5 million in value in the 
towing and recovery vehicle markets.

IV. Remedies Available to Potential Private 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 
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 damage action. 
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 subsequent private lawsuit that may be brought against defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States and defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest. The APPA provides for a period of at least sixty days 
preceding the effective date of the proposed Final Judgment within 
which any person may submit to the United States written comments 
regarding the proposed Final Judgment. Any person who wishes to comment 
should do so in writing within sixty days of the date of publication of 
this Competitive Impact Statement in the Federal Register. The United 
States will evaluate and respond to the comments. All written comments 
will be given due consideration by the Department of Justice, which 
remains free to withdraw its consent to the proposed Final Judgment at 
any time prior to its entry. The written comments and the response of 
the United States will be filed with the Court and published in the 
Federal Register. Written comments should be submitted to: Mary Jean 
Moltenbrey, Chief, Civil Task Force, Antitrust Division, United States 
Department of Justice, 325 Seventh Street, N.W., Suite 300, Washington, 
DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over the action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    The United States considered, as an alternative to the proposed 
Final Judgment, a full trial on the merits. The United States is 
satisfied, however, that the broad licensing required by the decree is 
the most effective form of relief in this case, where the challenged 
acquisitions were completed some years ago and given the configuration 
of these markets. The proposed relief will provide and promote 
competition in the design, manufacture and sale of towtrucks, and will 
significantly ease barriers to entry.

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

    The APPA requires that proposed consent judgments in antitrust 
cases brought by the United States be subject to a sixty-day comment 
period, after which the Court shall determine whether entry of the 
proposed Final Judgment ``is in the public interest.'' In making that 
determination, the Court may consider:

    (1) the competitive impact of such judgment, including 
termination of alleged violations, provisions for enforcement and 
modification, duration or relief sought, anticipated effects of 
alternative remedies actually considered, and any other 
consideration bearing upon the adequacy of such judgment;
    (2) the impact of entry of such judgment upon the public 
generally and individuals alleging specific injury from the 
violations set forth in the complaint including consideration of the 
public benefit, if any, to be derived from a determination of the 
issuers at trial. 15 U.S.C. 16(e).

    As the Court of Appeals for the District of Columbia Circuit held, 
the APPA permits the Court to consider, among other things, the 
relationship between the remedy secured and the specific allegations 
set forth in the government's complaint, whether the decree is 
sufficiently clear, whether enforcement mechanisms are sufficient, and 
whether the decree may positively harm third parties. See United States 
v. Microsoft, 56 F.3d 1448 (D.C. Cir. 1995).
    In conducting this inquiry, ``the Court is nowhere compelled to go 
to trial or to engage in extended proceedings which might have the 
effect of vitiating the benefits of prompt and less costly settlement 
through the consent decree process.\3\ Rather,


[[Page 13325]]


absent a showing of corrupt failure of the government to discharge 
its duty, the Court, in making its public interest finding, should * 
* * carefully consider the explanations of the government in the 
competitive impact statement and its responses to comment in order 
to determine whether those explanations are reasonable under the 
circumstances.

    \3\ 119 Cong. Rec. 24598 (1973); see also United States v. 
Gillette Co., 406 F. Supp. 713, 715 (D. Mass. 1975). A ``public 
interest'' determination can be made properly on the basis of the 
Competitive Impact Statement and Response to Comments files pursuant 
to the APPA. Although the APPA authorizes the use of additional 
procedures, 15 U.S.C. 16(f), those procedures are discretionary. A 
court need not invoke any of them unless it believes that the 
comments have raised significant issues and the further proceeding 
would aid the court in resolving those issues. See H.R. 93-1463, 
93rd Cong. 2d Sess. 8-9, reprinted in (1974) U.S.C.C.A.N. 6535, 
6538.

United States v. Mid-America Dairymen, Inc., 1977-1 Trade Cas. para. 
61,508 at 71,980 9W.d. Mo. 1977). Accordingly, with respect to the 
adequacy of the relief secured by the decree, a court may not ``engage 
in an unrestricted evaluation of what relief would best serve the 
public. ``United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 
1988), quoting United States v. Bechtel Corp., 648 F.2d 660,666 (9th 
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Cir.), cert. denied, 454 U.S. 1083 (1981). Precedent requires that

[t]he balancing of competing social and political interests affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is the one that will best serve society, but 
whether the settlement is `within the reaches of the public 
interest.' More elaborate requirements might undermine the 
effectiveness of antitrust enforcement by consent decree.\4\
---------------------------------------------------------------------------

    \4\ United States v. Bechtel, 648 F.2d at 666 (internal 
citations omitted) (emphasis added); see United v. BNS, Inc., 858 F. 
2d at 463; United States v. National Broadcasting Co., 449 F. Supp. 
1127, 1143 (C.D. Cal. 1978); Gillette, 406 F. Supp. at 716. See also 
United States v. American Cyanamid Co., 719 F. 2d 558, 565 (2d Cir. 
1983).

    The proposed Final Judgment, therefore, should not be reviewed 
under a standard of whether it is certain to eliminate every 
anticompetitive effect of a particular practice or whether it mandates 
certainty of free competition in the future. Court approval of a final 
judgment requires a standard more flexible and less strict than the 
---------------------------------------------------------------------------
standard required for a finding of liability:

[A] proposed decree must be approved even if it falls short of the 
remedy the court would impose on its own, as long as it falls within 
the range of acceptability or is ``within the reaches of public 
interest.'' \5\

    \5\ United States v. American Tel. & Tel. Co., 552 F. Supp. 131, 
150 (D.D.C. 1982) (citations omitted), aff'd sub nom. Maryland v. 
United States, 460 U.S. 1001 (1983), quoting Gillette, 406 F. Supp. 
at 716; United States v. Alcan Aluminium, Ltd., 605 F. Supp. 619, 
622 (W.D. Ky. 1985).

    Moreover, the Court's role under the Tunney Act is limited to 
reviewing the remedy in relationship to the violations that the United 
States has alleged in its complaint, and the Act does not authorize the 
Court to ``construct [its] own hypothetical case and then evaluate the 
decree against the cases.'' Microsoft, 56 F.3d at 1459. Since ``[t]he 
court's authority to review the decree depends entirely on the 
government's exercising its prosecutorial discretion by bringing a case 
in the first place,'' it follows that the court ``is only authorized to 
review the decree itself'', and not to ``effectively redraft the 
complaint'' to inquire into other matters that the United States might 
have but did not pursue. Id.

VIII. Determinative Documents

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

    For plaintiff United States of America.

    Respectfully submitted,

Kurt Shaffert,
D.C. Bar No. 11791.
John W. Poole,
D.C. Bar No. 56944.
William Stallings,
D.C. Bar No. 444924, Attorneys, Civil Task Force, Antitrust Division, 
U.S. Department of Justice, 325 7th Street, N.W., Rm. 300, Washington, 
DC 20530.
    Dated: February 23, 2000, Washington, DC.

Certificate of Service

    This certifies that on this day I caused a true copy of the 
foregoing Competitive Impact Statement to be served by first class 
mail, postage prepaid, upon counsel for defendants, as indicated below:

C. Loring Jetton, Jr., Esquire, Wilmer, Cutler & Pickering, 2445 M 
Street, Northwest, Washington, DC 20037-1420, Counsel for Defendants 
Miller Industries, Inc., Miller Industries Towing Equipment, Inc., and 
Chevron, Inc.

    Dated: February 23, 2000.
Kurt Shaffert.
  

[FR Doc. 00-5536 Filed 3-10-00; 8:45 am]
BILLING CODE 4410-11-M