[Federal Register Volume 73, Number 242 (Tuesday, December 16, 2008)]
[Notices]
[Pages 76383-76406]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-29603]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States et al. v. Republic Services, Inc. et al.; Proposed 
Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec.  16(b)-(h), that a proposed Final 
Judgment and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States v. Republic Services, Inc. & Allied Waste Industries, Inc., 
Civil Action No. 1:08-cv-02076. On December 3, 2008, the United States 
filed a Complaint alleging that the proposed acquisition by Republic 
Services, Inc. of Allied Waste Industries, Inc. would violate section 7 
of the Clayton Act, 15 U.S.C. 18, by substantially lessening 
competition in the provision of non-franchised small container 
commercial waste collection services in the areas of Atlanta, Georgia; 
Cape Girardeau, Missouri; Charlotte, North Carolina; Fort Worth, Texas; 
Greenville-Spartanburg, South Carolina; Houston, Texas; Lexington, 
Kentucky; Lubbock, Texas; and Northwest Indiana; and in the provision 
of municipal solid waste disposal services in the areas of Atlanta, 
Georgia; Cape Girardeau, Missouri; Charlotte, North Carolina; 
Cleveland, Ohio; Denver, Colorado; Flint, Michigan; Fort Worth, Texas; 
Greenville-Spartanburg, South Carolina; Houston, Texas; Los Angeles, 
California; Northwest Indiana; Philadelphia, Pennsylvania; and San 
Francisco, California. The proposed Final Judgment, filed the same day 
as the Complaint, requires Republic to divest certain non-franchised 
small container

[[Page 76384]]

commercial waste collection assets in the small container collection 
areas of concern and certain municipal solid waste disposal assets in 
the municipal solid waste disposal services areas of concern. A 
Competitive Impact Statement filed by the United States describes the 
Complaint, the proposed Final Judgment, the industry, and the remedies 
available to private litigants who may have been injured by the alleged 
violation.
    Copies of the Complaint, proposed Final Judgment, and Competitive 
Impact Statement are available for inspection at the Department of 
Justice, Antitrust Division, Antitrust Documents Group, 450 Fifth 
Street, NW., Suite 1010, Washington, DC 20530 (telephone: 202-514-
2481), on the Department of Justice's Web site at http://www.usdoj.gov/atr, and at the Office of the Clerk of the United States District Court 
for the District of Columbia. Copies of these materials may be obtained 
from the Antitrust Division upon request and payment of the copying fee 
set by Department of Justice regulations.
    Public comment is invited within 60 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 Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, 
U.S. Department of Justice, 1401 H Street, NW., Suite 3000, Washington, 
DC 20530 (telephone: 202-307-0924).

Patricia A. Brink,
Deputy Director of Operations.

United States District Court for the District of Columbia

    United States of America, Department of Justice, Antitrust 
Division, 1401 H Street, NW., Suite 3000, Washington, DC 20530; 
State of California, Office of Attorney General, 455 Golden Gate 
Avenue, San Francisco, CA 94102; Commonwealth of Kentucky, Consumer 
Protection Division, 1024 Capital Center Drive, Frankfort, KY 40601; 
State of Michigan, Consumer Protection Division, Antitrust Section, 
525 W. Ottawa Street, 6th Floor, Lansing, Michigan 48913; State of 
North Carolina, Department of Justice, 9001 Mail Service Center, 
Raleigh, NC 27699-9001; State of Ohio, Attorney General's Office, 
150 East Gay Street, 23rd Floor, Columbus, OH 43215; Commonwealth of 
Pennsylvania, Office of the Attorney General, Strawberry Square, 
16th Floor, Harrisburg, PA 17120; and State of Texas, Antitrust 
Division, Office of the Attorney General, PO Box 12548, Austin, TX 
78711-2548; Plaintiffs, v. Republic Services, Inc., 110 S.E. 6th 
Street, 28th Floor, Fort Lauderdale, FL 33301; and Allied Waste 
Industries, Inc., 18500 North Allied Way, Phoenix, AZ 85054, 
Defendants.

Civil Action No.: 1.08-Cv-02076.
Description: Antitrust.
Judge: Roberts, Richard W.
Date Stamp: 12/3/2008.

Complaint

    Plaintiff United States of America (``United States''), acting 
under the direction of the Attorney General of the United States, and 
plaintiffs State of California, Commonwealth of Kentucky, State of 
Michigan, State of North Carolina, State of Ohio, Commonwealth of 
Pennsylvania, and State of Texas (the ``States''), acting under the 
direction of their respective Attorneys General, bring this civil 
antitrust action to enjoin the acquisition by defendant Republic 
Services, Inc. (``Republic'') of the voting securities of defendant 
Allied Waste Industries, Inc. (``Allied'') and to obtain equitable and 
other relief as is appropriate. Plaintiffs complain and allege as 
follows:

I. Nature of the Action

    1. Pursuant to a stock purchase agreement dated June 22, 2008, 
Republic plans to acquire all of the issued and outstanding voting 
securities of Allied, in a transaction valued at $4.5 billion. 
Defendants Republic and Allied currently compete to provide small 
container commercial waste collection and municipal solid waste 
(``MSW'') disposal in areas across the United States. The proposed 
transaction would substantially lessen competition for small container 
commercial waste collection service as a result of Republic's 
acquisition of Allied small container commercial waste collection 
assets in the following areas: (a) Atlanta, Georgia; (b) Cape 
Girardeau, Missouri; (c) Charlotte, North Carolina; (d) Fort Worth, 
Texas; (e) Greenville-Spartanburg, South Carolina; (f) Houston, Texas; 
(g) Lexington, Kentucky; (h) Lubbock, Texas; and (i) Northwest Indiana. 
The proposed transaction also would substantially lessen competition 
for MSW disposal service as a result of Republic's acquisition of 
Allied's MSW disposal assets in the following areas: (a) Atlanta, 
Georgia; (b) Cape Girardeau, Missouri; (c) Charlotte, North Carolina; 
(d) Cleveland, Ohio; (e) Denver, Colorado; (f) Flint, Michigan; (g) 
Fort Worth, Texas; (h) Greenville-Spartanburg, South Carolina; (i) 
Houston, Texas; (j) Los Angeles, California; (k) Northwest Indiana; (l) 
Philadelphia, Pennsylvania; and (m) San Francisco, California,
    2. Defendants Republic and Allied are two of only a few significant 
providers of small container commercial waste collection or MSW 
disposal services in each of the identified areas. Unless the 
acquisition is enjoined, consumers of small container commercial waste 
collection or MSW disposal services in these areas likely will pay 
higher prices and receive fewer services as a consequence of the 
elimination of the vigorous competition between Republic and Allied. 
Accordingly, Republic's acquisition of Allied would violate Section 7 
of the Clayton Act, 15 U.S.C. 18.

II. Jurisdiction and Venue

    3. This action is filed by the United States under Section 15 of 
the Clayton Act, 15 U.S.C. 25, to prevent and restrain the violation by 
defendants of Section 7 of the Clayton Act, 15 U.S.C. 18. Each of the 
States brings this action under Section 16 of the Clayton Act, 15 
U.S.C. 26, to prevent and restrain the violation by defendants of 
Section 7 of the Clayton Act, 15 U.S.C. 18. The States, by and through 
their respective Attorneys General, or other authorized officials, 
bring this action in their sovereign capacities and as parens patriae 
on behalf of the citizens, general welfare and economy of each of their 
states.
    4. Defendant Allied transacts business in the District of Columbia, 
and Republic and Allied have consented to venue and personal 
jurisdiction, in the District of Columbia. Venue is therefore proper in 
this District under Section 12 of the Clayton Act, 15 U.S.C. 22 and 28 
U.S.C. 1391(c).
    5. Defendants Republic and Allied collect MSW from residential, 
commercial, and industrial customers, and they own and operate transfer 
stations and landfills that process and dispose of MSW. In their small 
container commercial waste collection and MSW disposal businesses, 
Republic and Allied make sales and purchases in interstate commerce, 
ship waste in the flow of interstate commerce, and engage in activities 
substantially affecting interstate commerce, as well as commerce in 
each of the states. The Court has jurisdiction over this action and 
over the parties pursuant to 15 U.S.C. 22 and 28 U.S.C. 1331 and 1337.

III. Defendants and the Transaction

    6. Republic is a Delaware corporation with its principal office in 
Fort Lauderdale, Florida. Republic is the nation's third largest waste 
hauling and disposal company. It provides small container commercial 
waste collection and MSW disposal services throughout the United 
States. In 2007, Republic reported total revenues of approximately $3.2 
billion.
    7. Allied is a Delaware corporation with its principal office in 
Phoenix,

[[Page 76385]]

Arizona. Allied is the nation's second largest waste hauling and 
disposal company. It also provides small container commercial waste 
collection and MSW disposal services throughout the United States. In 
2007, Allied reported total revenues of approximately $6.1 billion.
    8. On January 22, 2008, defendants Republic and Allied entered into 
a stock purchase agreement pursuant to which Republic will acquire all 
of the issued and outstanding voting securities of Allied in a 
transaction valued at $4.5 billion.

IV. Trade and Commerce

A. The Relevant Service Markets

Small Container Commercial Waste Collection
    9. Waste collection firms, or haulers, collect MSW from 
residential, commercial and industrial establishments and transport the 
waste to a disposal site, such as a transfer station, landfill or 
incinerator, for processing and disposal. Private waste haulers 
typically contract directly with customers for the collection of waste 
generated by commercial accounts. MSW generated by residential 
customers, on the other hand, often is collected either by local 
governments or by private haulers pursuant to contracts bid by, or 
franchises granted by, municipal authorities.
    10. ``Small container commercial waste collection'' means the 
business of collecting MSW from commercial and industrial accounts, 
usually in ``dumpsters'' (i.e., a small container with one to ten cubic 
yards of storage capacity), and transporting or ``hauling'' such waste 
to a disposal site by use of a front-end or rear-end load truck. 
Typical small container commercial waste collection customers include 
office and apartment buildings and retail establishments (e.g., stores 
and restaurants). As used herein, ``small container commercial waste 
collection'' does not include small container commercial waste 
collection of franchised routes, the collection of roll-off containers, 
or residential collection service.
    11. Small container commercial waste collection differs in many 
important respects from the collection of residential or other types of 
waste. An individual commercial customer typically generates 
substantially more MSW than a residential customer. To handle this high 
volume of MSW efficiently, haulers often provide commercial customers 
with small containers, also called dumpsters, for storing the waste. 
Haulers organize their commercial accounts into routes, and collect and 
transport the MSW generated by these accounts in front-end load 
(``FEL'') trucks uniquely well suited for commercial waste collection. 
Less frequently, haulers may use more maneuverable, but less efficient, 
rear-end load (``REL'') trucks, especially in those areas in which a 
collection route includes narrow alleyways or streets. FEL trucks are 
unable to navigate narrow passageways easily and cannot efficiently 
collect the waste located in them.
    12. On a typical small container commercial waste collection route, 
an operator drives a FEL vehicle to the customer's container, engages a 
mechanism that grasps and lifts the container over the front of the 
truck, and empties the container into the vehicle's storage section 
where the waste is compacted and stored. The operator continues along 
the route, collecting MSW from each of the commercial accounts, until 
the vehicle is full. The operator then drives the FEL truck to a 
disposal facility, such as a transfer station, landfill or incinerator, 
and empties the contents of the vehicle. Depending on the number of 
locations and amount of waste collected on the route, the operator may 
make one or more trips to the disposal facility in the servicing of the 
route.
    13. In contrast to a small container commercial waste collection 
route, a residential waste collection route is significantly more labor 
intensive. The customer's MSW is stored in much smaller containers 
(e.g., garbage bags or trash cans) and instead of FEL trucks, waste 
collection firms routinely use REL or side-load trucks manned by larger 
crews (usually, two-person or three-person teams). On residential 
routes, crews generally hand-load the customer's MSW, typically by 
tossing garbage bags and emptying trash cans into the vehicle's storage 
section. Because of the differences in the collection processes, 
residential customers and commercial customers usually are organized 
into separate routes.
    14. Likewise, other types of collection activities, such as the use 
of roll-off containers (typically used for construction debris) and the 
collection of liquid or hazardous waste, are rarely combined with small 
container commercial waste collection. This separation of routes is due 
to differences in the hauling equipment required, the volume of waste 
collected, health and safety concerns, and the ultimate disposal option 
used.
    15. The differences in the types and volume of MSW collected and in 
the equipment used in collection services distinguish small container 
commercial waste collection from all other types of waste collection 
activities. Absent competition from other small container commercial 
waste collection firms, a small container commercial waste collection 
provider could profitably increase its charges without losing 
significant sales or revenues to firms engaged in the provision of 
other types of waste collection services. Thus, small container 
commercial waste collection is a line of commerce, or relevant service, 
for purposes of analyzing the effects of the acquisition under Section 
7 of the Clayton Act, 15 U.S.C. 18.
Disposal of Municipal Solid Waste
    16. ``MSW'' means municipal solid waste, a term of art used to 
describe solid putrescible waste generated by households and commercial 
establishments such as retail stores, offices, restaurants, warehouses, 
and non-manufacturing activities in industrial facilities. MSW does not 
include special handling waste (e.g., waste from manufacturing 
processes, regulated medical waste, sewage, and sludge), hazardous 
waste, or waste generated by construction or demolition sites. MSW has 
physical characteristics that readily distinguish it from other liquid 
or solid waste.
    17. In order to be disposed of lawfully, MSW must be disposed in a 
landfill or an incinerator, and such facilities must be located on 
approved types of land and operated under prescribed procedures. 
Federal, state and local safety, environmental, zoning and permit laws 
and regulations dictate critical aspects of storage, handling, 
transportation, processing and disposal of MSW in each market. In less 
densely populated areas of the country, MSW often is disposed of 
directly into landfills that are permitted and regulated by the state. 
Landfill permit restrictions often impose limitations on the type and 
amount of waste that can be deposited. In many urban and suburban 
areas, because landfills are scarce due to high population density and 
the limited availability of suitable land. Accordingly, MSW generated 
in such areas often is burned in an incinerator or taken to a transfer 
station. A transfer station is an intermediate disposal site for the 
processing and temporary storage of MSW before transfer, in bulk, to 
more distant landfills or incinerators for final disposal. Anyone who 
fails to dispose of MSW in a lawful manner can be subject to severe 
civil and criminal penalties.
    18. Because of the strict laws and regulations that govern the 
disposal of

[[Page 76386]]

MSW, there are no good substitutes for MSW disposal in landfills or 
incinerators, or at transfer stations located near the source of the 
waste. Firms that compete in the disposal of MSW can profitably 
increase their charges to haulers of MSW without losing significant 
sales to any other firms. Thus, disposal of MSW is a line of commerce, 
or relevant service, for purposes of analyzing the effects of the 
acquisition under Section 7 of the Clayton Act, 15 U.S.C. 18.

B. The Relevant Geographic Markets

Small Container Commercial Waste Collection
    19. Small container commercial waste collection is generally 
provided in highly localized areas because, to operate efficiently and 
profitably, a hauler must have sufficient density (i.e., a large number 
of commercial accounts that are reasonably close together) in its small 
container commercial waste collection operations. If a hauler has to 
drive significant distances between customers, it earns less money for 
the time the truck is operating. For the same reason, the accounts must 
be near the operator's base of operations. It is economically 
impractical for a small container commercial waste collection firm to 
service metropolitan areas from a distant base, which requires that the 
FEL truck travel long distances just to arrive at its route. Haulers, 
therefore, generally establish garages and related facilities within 
each major local area served.
    20. In each of the following areas encompassing the listed 
counties, local small container commercial waste collection firms, 
absent competition from other small container commercial waste 
collection firms, could profitably increase charges to local customers 
without losing significant sales to more distant competitors: Atlanta, 
Georgia (Cherokee, Forsyth, Hall, Jackson, Barrow, Gwinnett, Walton, 
DeKalb, Rockdale, Fulton, Clayton, Cobb and Paulding Counties); Cape 
Girardeau, Missouri (Cape Girardeau County); Charlotte, North Carolina 
(Mecklenburg County); Fort Worth, Texas (Tarrant County); Greenville-
Spartanburg, South Carolina (Greenville and Spartanburg Counties); 
Houston, Texas (Harris County); Lexington, Kentucky (Fayette, 
Jessamine, Woodford, Scott and Franklin Counties); Lubbock, Texas 
(Lubbock County); and Northwest Indiana (Lake, Porter and LaPorte 
Counties). Accordingly, each of these areas is a section of the 
country, or relevant geographic market, for purposes of analyzing the 
effects of the acquisition under Section 7 of the Clayton Act, 15 
U.S.C. 18.
Disposal of Municipal Solid Waste
    21. MSW generally is transported by collection trucks to landfills 
and transfer stations, and the availability of disposal sites close to 
a hauler's routes is a major factor that determines a hauler's 
competitiveness and profitability. The cost of transporting MSW to a 
disposal site often is a substantial component of the cost of disposal. 
The cost advantage of local disposal sites limits the areas where MSW 
can be economically transported and disposed of by haulers and creates 
localized markets for MSW disposal services.
    22. In each of the following areas encompassing the listed 
counties, the high costs of transporting MSW and the substantial travel 
time to other disposal facilities based on distance, natural barriers 
and congested roadways, limit the distance that haulers of MSW 
generated in those areas can travel economically to dispose of their 
waste: Atlanta, Georgia (Cherokee, Forsyth, Hall, Jackson, Barrow, 
Gwinnett, Walton, DeKalb, Rockdale, Fulton, Clayton, Cobb and Paulding 
Counties); Cape Girardeau, Missouri (Cape Girardeau County); Charlotte, 
North Carolina (Mecklenburg County); Cleveland, Ohio (Cuyahoga County); 
Denver, Colorado (Denver and Arapahoe Counties); Flint, Michigan 
(Saginaw and Genesee Counties); Fort Worth, Texas (Tarrant County); 
Greenville-Spartanburg, South Carolina (Greenville and Spartanburg 
Counties); Houston, Texas (Harris County); Los Angeles, California (Los 
Angeles County); Northwest Indiana (Lake, Porter and LaPorte Counties); 
Philadelphia, Pennsylvania (Philadelphia County); and San Francisco, 
California (Contra Costa, Solano and Alameda Counties). The firms that 
compete in disposal of MSW generated in each of these areas generally 
own landfills, transfer stations or incinerators located within the 
area or no farther than roughly 25 to 35 miles outside the area's 
border.
    In the event that all the owners of those local disposal facilities 
imposed a small but significant increase in the price of the disposal 
of MSW, haulers of MSW generated in each area could not profitably turn 
to more distant disposal facilities. Firms that compete for the 
disposal of MSW generated in each area, absent competition from other 
local MSW disposal operators, could profitably increase their charges 
for disposal of MSW generated in the area without losing significant 
sales to more distant disposal sites. Accordingly, disposal of MSW 
generated in each of the areas of Atlanta, Georgia; Cape Girardeau, 
Missouri; Charlotte, North Carolina; Cleveland, Ohio; Denver, Colorado; 
Flint, Michigan; Fort Worth, Texas; Greenville-Spartanburg, South 
Carolina; Houston, Texas; Los Angeles, California; Northwest Indiana; 
Philadelphia, Pennsylvania; and San Francisco, California is a section 
of the country, or relevant geographic market, for purposes of 
analyzing the competitive effects of the acquisition under Section 7 of 
the Clayton Act, 18 U.S.C. 15.

C. Competitive Effects of the Acquisition

    23. Defendants Republic and Allied directly compete in small 
container commercial waste collection service in each of the relevant 
geographic markets for small container commercial waste collection, 
defined in paragraph 20. In these markets, Republic and Allied each 
account for a substantial share of total revenues from small container 
commercial waste collection services.
    24. Defendants Republic and Allied directly compete in the disposal 
of MSW in each of the relevant geographic markets for MSW disposal, 
defined in paragraph 22. In these markets, Republic and Allied each 
account for a substantial share of MSW disposal revenue and capacity.
    25. The acquisition of Allied voting securities by Republic would 
remove a significant competitor in small container commercial waste 
collection and the disposal of MSW in already highly concentrated and 
difficult-to-enter markets. In each of these markets, the resulting 
substantial increase in concentration, loss of competition, and absence 
of any reasonable prospect of significant new entry or expansion by 
market incumbents likely will result in higher prices for collection of 
small container commercial waste or the disposal of MSW.
Atlanta, Georgia Area
    26. In the Atlanta, Georgia area, the proposed acquisition would 
reduce from four to three the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Atlanta, Georgia 
area is approximately $60 million. After the acquisition, defendants 
would have approximately 50 percent of the total number of small 
container commercial collection routes in the market. Using a standard 
measure of market concentration called the ``HHI'' (defined and 
explained in Appendix A), the post-merger HHI for small container 
commercial waste

[[Page 76387]]

collection would be approximately 4064, an increase of 1225 points over 
the pre-merger HHI of 2839.
    27. The proposed acquisition also would reduce from four to three 
the number of significant competitors for the disposal of MSW in the 
Atlanta, Georgia area. Annual revenue from MSW disposal in this market 
is approximately $89 million. After the acquisition, defendants would 
have approximately 46 percent of the MSW disposal market. The post-
merger HHI for MSW disposal would be approximately 3864, an increase of 
953 points over the pre-merger HHI of 2911.
Cape Girardeau, Missouri Area
    28. In the Cape Girardeau, Missouri area, the proposed acquisition 
would reduce from four to three the number of significant competitors 
in the collection of small container commercial waste. Annual revenue 
from small container commercial waste collection in the Cape Girardeau, 
Missouri area is approximately $5 million. After the acquisition, 
defendants would have approximately 64 percent of the total number of 
small container commercial collection routes in the market. The post-
merger HHI for small container commercial waste collection would be 
approximately 4552, an increase of 2034 points over the pre-merger HHI 
of 2518.
    29. The proposed acquisition also would reduce from three to two 
the number of significant competitors for the disposal of MSW in the 
Cape Girardeau, Missouri area. Annual revenue from MSW disposal in this 
market is approximately $3 million. After the acquisition, defendants 
would have approximately 70 percent of the MSW disposal market. The 
post-merger HHI for MSW disposal would be approximately 5800, an 
increase of 2442 points over the pre-merger HHI of 3358.
Charlotte, North Carolina Area
    30. In the Charlotte, North Carolina area, the proposed acquisition 
would reduce from three to two the number of significant competitors in 
the collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Charlotte, North 
Carolina area is approximately $40 million. After the acquisition, 
defendants would have approximately 70 percent of the total number of 
small container commercial collection routes in the market. The post-
merger HHI for small container commercial waste collection would 
approximate 5456, an increase of 2340 points over the pre-merger HHI of 
3116.
    31. The proposed acquisition also would reduce from three to two 
the number of significant competitors for the disposal of MSW in the 
Charlotte, North Carolina area. Annual revenue from MSW disposal in 
this market is approximately $69 million. After the acquisition, 
defendants would have approximately 80 percent of the MSW disposal 
market. The post-merger HHI for MSW disposal would be approximately 
8652, an increase of 3794 points over the pre-merger HHI of 4918.
Cleveland, Ohio Area
    32. In the Cleveland, Ohio area, the proposed acquisition would 
reduce from four to three the number of significant competitors for the 
disposal of MSW. Annual revenue from MSW disposal in this market is 
approximately $68 million. After the acquisition, defendants would have 
approximately 56 percent of the MSW disposal market. The post-merger 
HHI for MSW disposal would be approximately 3837, an increase of 1570 
points over the pre-merger HHI of 2267.
Denver, Colorado Area
    33. In the Denver, Colorado area, the proposed acquisition would 
reduce from three to two the number of significant competitors for the 
disposal of MSW. Annual revenue from MSW disposal in this market is 
approximately $56 million. After the acquisition, defendants would have 
approximately 37 percent of the MSW disposal market, and the two 
largest competitors would have roughly 87 percent. The post-merger HHI 
for MSW disposal would be approximately 4104, an increase of 551 points 
over the pre-merger HHI of 3353.
Flint, Michigan Area
    34. In the Flint, Michigan area, the proposed acquisition would 
reduce from four to three the number of competitors for the disposal of 
MSW. Annual revenue from MSW disposal in this market is approximately 
$29 million. After the acquisition, defendants would have over 51 
percent of the MSW disposal market. The post-merger HHI for MSW 
disposal would be approximately 4311, an increase in excess of 827 
points over the pre-merger HHI of 3483.
Fort Worth, Texas Area
    35. In the Fort Worth, Texas area, the proposed acquisition would 
reduce from four to three the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Fort Worth, Texas 
area is approximately $55 million. After the acquisition, defendants 
would have approximately 42 percent of the total number of small 
container commercial collection routes in the market, and the two 
largest competitors would have approximately 70 percent of the market. 
The post-merger HHI for small container commercial waste collection 
would be approximately 2711, an increase of 783 points over the pre-
merger HHI of 1928.
    36. The proposed acquisition also would reduce from four to three 
the number of significant competitors for the disposal of MSW in the 
Fort Worth, Texas area. Annual revenue from MSW disposal in this market 
is approximately $84 million. After the acquisition, defendants would 
have over 55 percent of the MSW disposal market. The post-merger HHI 
for MSW disposal would be approximately 4428, an increase of 1332 
points over the pre-merger HHI of 3096.
Greenville-Spartanburg, South Carolina Area
    37. In the Greenville-Spartanburg area, the proposed acquisition 
would reduce from three to two the number of significant competitors in 
the collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Greenville-
Spartanburg area is approximately $41 million. After the acquisition, 
defendants would have approximately 69 percent of the total number of 
small container commercial collection routes in the market. The post-
merger HHI for small container commercial waste collection would be 
approximately 5714, an increase of 2173 points over the pre-merger HHI 
of 3541.
    38. The proposed acquisition also would reduce from three to two 
the number of significant competitors for the disposal of MSW in the 
Greenville-Spartanburg area. Annual revenue from MSW disposal in this 
market is approximately $40 million. After the acquisition, defendants 
would have approximately 50 percent of the MSW disposal market. The 
post-merger HHI for MSW disposal would be approximately 5000, an 
increase of 1226 points over the pre-merger HHI of 3774.
Houston, Texas Area
    39. In the Houston, Texas area, the proposed acquisition would 
reduce from three to two the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Houston, Texas area 
is approximately $109 million. After the acquisition, defendants would 
have approximately 56 percent of the total number of small container 
commercial collection routes in the market. The post-merger HHI for

[[Page 76388]]

small container commercial waste collection would be approximately 
4060, an increase of 1613 points over the pre-merger HHI of 2447.
    40. The proposed acquisition also would reduce from three to two 
the number of significant competitors for the disposal of MSW in the 
Houston, Texas area. Annual revenue from MSW disposal in this market is 
approximately $75 million. After the acquisition, defendants would have 
approximately 70 percent of the MSW disposal market. The post-merger 
HHI for MSW disposal would be approximately 5733, an increase of 2408 
points over the pre-merger HHI of 3325.
Lexington, Kentucky Area
    41. In the Lexington, Kentucky area, the proposed acquisition would 
reduce from three to two the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Lexington, Kentucky 
area is approximately $9 million. After the acquisition, defendants 
would have approximately 75 percent of the total number of small 
container commercial collection routes in the market. The post-merger 
HHI for small container commercial waste collection would be 
approximately 6250, an increase of 2500 points over the pre-merger HHI 
of 3750.
Los Angeles, California Area
    42. In the Los Angeles, California area, the proposed acquisition 
would reduce from four to three the number of significant competitors 
for the disposal of MSW. Annual revenue from MSW disposal in this 
market is approximately $372 million. After the acquisition, defendants 
would have approximately 39 percent of the MSW disposal market, and the 
two largest competitors would have 61 percent. The post-merger HHI for 
MSW disposal would be approximately 3070, an increase of 865 points 
over the pre-merger HHI of 2204.
Lubbock, Texas Area
    43. In the Lubbock, Texas area, the proposed acquisition would 
reduce from four to three the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Lubbock, Texas area 
is approximately $18 million. After the acquisition, defendants would 
have approximately 63 percent of the total number of small container 
commercial collection routes in the market. The post-merger HHI for 
small container commercial waste collection would be approximately 
4674, an increase of 1944 points over the pre-merger HHI of 2730.
Northwest Indiana Area
    44. In the Northwest Indiana area, the proposed acquisition would 
reduce from four to three the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Northwest Indiana 
area is approximately $2.4 million. After the acquisition, defendants 
would have approximately 44 percent of the total number of small 
container commercial collection routes in the market. The post-merger 
HHI for small container commercial waste collection would be 
approximately 3586, an increase of 981 points over the pre-merger HHI 
of 2605.
    45. The proposed acquisition also would reduce from four to three 
the number of significant competitors for the disposal of MSW in the 
Northwest Indiana area. Annual revenue from MSW disposal in this market 
is approximately $28 million. After the acquisition, defendants would 
have approximately 64 percent of the MSW disposal market. The post-
merger HHI for MSW disposal would be approximately 4864, an increase of 
1718 points over the pre-merger HHI of 4111.
Philadelphia, Pennsylvania Area
    46. In the Philadelphia, Pennsylvania area, the proposed 
acquisition would reduce from three to two the number of significant 
competitors for the disposal of MSW. Annual revenue from MSW disposal 
in this market is approximately $126 million. After the acquisition, 
defendants would have approximately 52 percent of the MSW disposal 
market. The post-merger HHI for MSW disposal would be approximately 
4547, an increase of 1396 points over the pre-merger HHI of 3151.
San Francisco, California Area
    47. In the San Francisco, California area, the proposed acquisition 
would reduce from three to two the number of significant competitors 
for the disposal of MSW. Annual revenue from MSW disposal in this 
market is approximately $101 million. After the acquisition, defendants 
would have approximately 50 percent of the MSW disposal market. The 
post-merger HHI for MSW disposal would be approximately 4256, an 
increase of 1283 points over the pre-merger HHI of 2973.

D. Entry Into Small Container Commercial Waste Collection

    48. Significant new entry into small container commercial waste 
collection is difficult and time-consuming in the areas of Atlanta, 
Georgia; Cape Girardeau, Missouri; Charlotte, North Carolina; Fort 
Worth, Texas; Greenville-Spartanburg, South Carolina; Houston, Texas; 
Lexington, Kentucky; Lubbock, Texas; and Northwest Indiana. A new 
entrant into small container commercial waste collection cannot provide 
a significant competitive constraint on the prices charged by market 
incumbents until it achieves minimum efficient scale and operating 
efficiencies comparable to existing firms. In order to obtain a 
comparable operating efficiency, a new firm must achieve route 
densities similar to those of firms already competing in the market. 
However, the incumbent's ability to engage in price discrimination and 
enter into long-term contracts with collection customers is effective 
in preventing new entrants from winning a large enough base of 
customers to achieve efficient routes in sufficient time to constrain 
the post-acquisition firm from significantly raising prices. 
Differences in the service provided by an incumbent hauler to each 
customer permit the incumbent easily to meet competition from new 
entrants by pricing its services lower to any individual customer that 
wants to switch to the new entrant. Incumbent firms frequently also use 
three to five year contracts, which may automatically renew or contain 
large liquidated damage provisions for contract termination. Such 
contracts make it more difficult for a customer to switch to a new 
hauler in order to obtain lower prices for its collection service. By 
making it more difficult for new haulers to obtain customers, these 
practices increase the cost and time required by an entrant to form an 
efficient route, reducing the likelihood that the entrant ultimately 
will be successful.

E. Entry Into MSW Disposal

    49. Significant new entry into the disposal of MSW in the areas of 
Atlanta, Georgia; Cape Girardeau, Missouri; Charlotte, North Carolina; 
Cleveland, Ohio; Denver, Colorado; Flint, Michigan; Fort Worth, Texas; 
Greenville-Spartanburg, South Carolina; Houston, Texas; Los Angeles, 
California; Northwest Indiana; Philadelphia, Pennsylvania; and San 
Francisco, California would be difficult and time-consuming. Obtaining 
a permit to construct a new disposal facility or to expand an existing 
one is a costly and time-consuming process that typically takes many 
years to conclude. Suitable land is scarce. Even when land is 
available, local public opposition often increases the time and 
uncertainty of successfully permitting a facility. It is

[[Page 76389]]

also difficult to overcome environmental concerns and satisfy other 
governmental requirements.
    50. Where it is not practical to construct and permit a landfill, 
it is necessary to use an incinerator to dispose of waste, or a 
transfer station to facilitate the use of more distant disposal 
options. Many of the problems associated with the permitting and 
construction of a landfill likewise make it difficult to permit and 
construct a transfer station or incinerator.
    51. In the areas of Atlanta, Georgia; Cape Girardeau, Missouri; 
Charlotte, North Carolina; Cleveland, Ohio; Denver, Colorado; Flint, 
Michigan; Fort Worth, Texas; Greenville-Spartanburg, South Carolina; 
Houston, Texas; Los Angeles, California; Northwest Indiana; 
Philadelphia, Pennsylvania; and San Francisco, California, entry by 
constructing and permitting a new MSW disposal facility would be costly 
and time-consuming, and unlikely to prevent market incumbents from 
significantly raising prices for the disposal of MSW following the 
acquisition.

V. Violation Alleged

    52. Republic's proposed acquisition of all Allied voting securities 
and waste hauling or disposal assets in the areas of Atlanta, Georgia; 
Cape Girardeau, Missouri; Charlotte, North Carolina; Cleveland, Ohio; 
Denver, Colorado; Flint, Michigan; Fort Worth, Texas; Greenville-
Spartanburg, South Carolina; Houston, Texas; Lexington, Kentucky; Los 
Angeles, California; Lubbock, Texas; Northwest Indiana; Philadelphia, 
Pennsylvania; and San Francisco, California likely will lessen 
competition substantially and tend to create a monopoly in interstate 
trade and commerce in violation of Section 7 of the Clayton Act.
    53. The transaction likely will have the following effects, among 
others:
    a. Competition in small container commercial waste collection 
service in the areas of Atlanta, Georgia; Cape Girardeau, Missouri; 
Charlotte, North Carolina; Fort Worth, Texas; Greenville-Spartanburg, 
South Carolina; Houston, Texas; Lexington, Kentucky; Lubbock, Texas; 
and Northwest Indiana will be lessened substantially;
    b. Prices charged by small container commercial waste collection 
firms in the areas of Atlanta, Georgia; Cape Girardeau, Missouri; 
Charlotte, North Carolina; Fort Worth, Texas; Greenville-Spartanburg, 
South Carolina; Houston, Texas; Lexington, Kentucky; Lubbock, Texas; 
and Northwest Indiana will increase;
    c. Competition in the disposal of MSW in the areas of Atlanta, 
Georgia; Cape Girardeau, Missouri; Charlotte, North Carolina; 
Cleveland, Ohio; Denver, Colorado; Flint, Michigan; Fort Worth, Texas; 
Greenville-Spartanburg, South Carolina; Houston, Texas; Los Angeles, 
California; Northwest Indiana; Philadelphia, Pennsylvania; and San 
Francisco, California will be lessened substantially; and
    d. Prices for disposal of MSW in the areas of Atlanta, Georgia; 
Cape Girardeau, Missouri; Charlotte, North Carolina; Cleveland, Ohio; 
Denver, Colorado; Flint, Michigan; Fort Worth, Texas; Greenville-
Spartanburg, South Carolina; Houston, Texas; Los Angeles, California; 
Northwest Indiana; Philadelphia, Pennsylvania; and San Francisco, 
California will increase.

VI. Requested Relief

    Plaintiffs request:
    1. That Republic's proposed acquisition of all Allied's issued and 
outstanding voting securities be adjudged and decreed to be unlawful 
and in violation of Section 7 of the Clayton Act;
    2. That defendants be permanently enjoined from carrying out the 
acquisition of voting securities described in the stock purchase 
agreement dated June 22, 2008, or from entering into or carrying out 
any agreement, understanding, or plan, the effect of which would be to 
merge the voting securities or assets of the defendants;
    3. That plaintiffs receive such other and further relief as the 
case requires and the Court deems proper; and
    4. That plaintiffs recover the costs of this action.

Dated: December 3, 2008
Respectfully submitted,
For Plaintiff United States of America
/s/--------------------------------------------------------------------
Deborah A. Garza,
Acting Assistant Attorney General, D.C. Bar #359259

/s/--------------------------------------------------------------------
Maribeth Petrizzi,
Chief, Litigation II Section, D.C. Bar #435204

/s/--------------------------------------------------------------------
David L. Meyer,
Principal Deputy Assistant Attorney General, D.C. Bar #414420

/s/--------------------------------------------------------------------
Dorothy B. Fountain,
Assistant Chief, Litigation II Section, D.C. Bar #439469

/s/--------------------------------------------------------------------
Patricia A. Brink,
Deputy Director of Operations

Lowell R. Stern, (D.C. Bar 440487)
Alexander Krulic (D.C. Bar 490070)
Carolyn Davis
Michael K. Hammaker
Stephen A. Harris
Leslie D. Peritz
Ferdose Al-Taie
Brian E. Rafkin
Attorneys, United States Department of Justice, Antitrust Division, 
Litigation II Section, 1401 H Street, NW., Suite 3000, Washington, D.C. 
20530, (202) 514-3676

Dated: December 3, 2008
For Plaintiff State of California
Edmund G. Brown Jr.,
Attorney General

Kathleen E. Foote,
Senior Assistant Attorney General

Sangeetha M. Raghunathan,
Deputy Attorney General

By:

/s/--------------------------------------------------------------------
Nicole S. Gordon,
Deputy Attorney General, 455 Golden Gate Avenue, San Francisco, CA 
94102, Tel.: (415) 703-5702, Fax: (415) 703-5480, Email: 
[email protected]

For Plaintiff Commonwealth of Kentucky
Jack Conway,
Attorney General

By:

/s/--------------------------------------------------------------------
C. Terrell Miller,
Assistant Attorney General

/s/--------------------------------------------------------------------
Maryellen B. Mynear,
Branch Manager, Litigation, Consumer Protection Division, 1024 Capital 
Center Drive, Frankfort, KY 40601, Tel.: (502) 696-5389, Fax: (502) 
573-8317, Email: [email protected]

For Plaintiff State of Michigan
Michael A. Cox,
Attorney General

By:

/s/--------------------------------------------------------------------
M. Elizabeth Lippitt,
Assistant Attorney General, Consumer Protection Division, Antitrust 
Section, Attorneys for the State of Michigan, G. Mennen Williams 
Building, 6th Floor, 525 W. Ottawa Street, Lansing, Michigan 48913, 
Tel.: (517) 335-0855, Fax: (517) 335-1935, Email: [email protected]

For Plaintiff State of North Carolina
Roy Cooper,
Attorney General

By:

/s/--------------------------------------------------------------------
K. D. Sturgis,
Assistant Attorney General, North Carolina Department of Justice, 9001

[[Page 76390]]

Mail Service Center, Raleigh, NC 27699-9001, Tel.: (919) 716.6000, Fax: 
919-716-6050, Email: [email protected]

For Plaintiff State of Ohio
Nancy H. Rogers,
Attorney General

By:

/s/--------------------------------------------------------------------
Jennifer L. Pratt,
Chief, Antitrust Section

Mitchell L. Gentile,
Principal Attorney, Antitrust Section

Office of the Ohio Attorney General, 150 East Gay St., 23rd Floor, 
Columbus, Ohio 43215, Tel.: (614) 466-4328, Fax: (614) 995-0266, Email: 
[email protected]

For Plaintiff Commonwealth of Pennsylvania
Thomas W. Corbett, Jr.,
Attorney General

By:

/s/--------------------------------------------------------------------
James A. Donahue, III,
Chief Deputy Attorney General

Jennifer J. Kirk,
Deputy Attorney General

Norman J. Marden,
Deputy Attorney General 

Antitrust Section, 14th Floor, Strawberry Square, Harrisburg, PA 17120, 
Tel.: (717) 787-4530, Fax: (717) 705-7110, Email: 
[email protected]

For Plaintiff State of Texas
Greg Abbott,
Attorney General

C. Andrew Weber,
First Assistant Attorney General

Jeff L. Rose,
Deputy Attorney General for Litigation

Mark Tobey,
Chief, Antitrust Division

By:

/s/--------------------------------------------------------------------
Kim Van Winkle,
Texas Bar #24003104, Antitrust Division, Office of the Attorney 
General, P.O. Box 12548, Austin, TX 78711-2548, Tel.: (512) 463-1266, 
Fax: (512) 320-0975, Email: [email protected]

Appendix A

Herfindahl-Hirschman Index Calculations

    ``HHI'' means the Herfindahl-Hirschman Index, a commonly accepted 
measure of market concentration. It is calculated by squaring the 
market share of each firm competing in the market and then summing the 
resulting numbers. For example, for a market consisting of four firms 
with shares of thirty, thirty, twenty, and twenty percent, the HHI is 
2600 (302 + 302 + 202 + 202 
= 2,600). The HHI takes into account the relative size and distribution 
of the firms in a market and approaches zero when a market consists of 
a large number of firms of relatively equal size. The HHI increases 
both as the number of firms in the market decreases and as the 
disparity in size between those firms increases.
    Markets in which the HHI is between 1,000 and 1,800 points are 
considered to be moderately concentrated and those in which the HHI is 
in excess of 1,800 points are considered to be highly concentrated. 
Transactions that increase the HHI by more than 100 points in highly 
concentrated markets presumptively raise antitrust concerns under the 
Horizontal Merger Guidelines issued by the U.S. Department of Justice 
and the Federal Trade Commission. See Horizontal Merger Guidelines 
Sec.  1.51.

United States District Court for the District of Columbia

    United States of America, State of California, Commonwealth of 
Kentucky, State of Michigan, State of North Carolina, State of Ohio, 
Commonwealth of Pennsylvania, and State of Texas, Plaintiffs, v. 
Republic Services, Inc., and Allied Waste Industries, Inc., 
Defendants.

Civil Action No.:
Description: Antitrust
Judge:
Date Stamp:

Proposed Final Judgment

    Whereas, plaintiffs, the United States of America, the State of 
California, the Commonwealth of Kentucky, the State of Michigan, the 
State of North Carolina, the State of Ohio, the Commonwealth of 
Pennsylvania, and the State of Texas, filed their Complaint on December 
3, 2008; the plaintiffs and defendants, Republic Services, Inc. and 
Allied Waste Industries, Inc., by their respective attorneys, have 
consented to the entry of this Final Judgment without trial or 
adjudication of any issue of fact or law; and without this Final 
Judgment constituting any evidence against or admission by any party 
regarding any issue of law or fact;
    And whereas, defendants agree 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 divestiture of the Divestiture Assets to assure that 
competition is not substantially lessened;
    And whereas, the United States requires defendants to make certain 
divestitures for the purpose of remedying the loss of competition 
alleged in the Complaint;
    And whereas, defendants have represented to the United States that 
the divestitures required below can and will be made, and that 
defendants will later raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the divestiture 
provisions contained below;
    Now, Therefore, before any testimony is taken, without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is hereby ordered, adjudged, and decreed:

I. Jurisdiction

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

II. Definitions

    As used in this Final Judgment:
    A. ``Acquirer'' or ``Acquirers'' means the entity or entities to 
whom defendants divest the Divestiture Assets.
    B. ``Allied'' means defendant Allied Waste Industries, Inc., a 
Delaware corporation with its headquarters in Phoenix, Arizona, its 
successors, assigns, subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and all of their directors, officers, 
managers, agents, and employees.
    C. ``Republic'' means defendant Republic Services, Inc., a Delaware 
corporation headquartered in Ft. Lauderdale, Florida, its successors, 
assigns, subsidiaries, divisions, groups, affiliates, partnerships, and 
joint ventures, and all of their directors, officers, managers, agents, 
and employees.
    D. ``Disposal'' means the business of disposing of waste into 
approved disposal sites, including the use of transfer stations to 
facilitate shipment of waste to other disposal sites.
    E. ``Divestiture Assets'' means the Relevant Disposal Assets and 
the Relevant Hauling Assets.
    F. ``Hauling'' means small container commercial waste collection 
from customers and the shipment of the collected waste to disposal 
sites. Hauling, as used herein, does not include collection of roll-off 
containers.
    G. ``Route'' means a group of customers receiving regularly 
scheduled small container commercial waste collection service and all 
tangible and intangible assets relating to the route, as of October 31, 
2008 (except for de

[[Page 76391]]

minimis changes, such as customers lost and gained in the ordinary 
course of business), including capital equipment, trucks and other 
vehicles (those assigned to routes and a pro-rata share of spare 
vehicles); containers (at the customer location and a pro-rata share of 
spares); supplies (pro-rata share); and if requested by the Acquirer, 
the real property and improvements to real property (e.g., garages and 
buildings that support the route) as specified in Section II, paragraph 
I below; customer lists; customer and other contracts; leasehold 
interests; permits/licenses and accounts receivable, excluding 
franchise customers.
    H. ``Relevant Disposal Assets'' means, unless otherwise noted, with 
respect to each transfer station and landfill listed and described 
herein, all of defendants' rights, titles, and interests in any 
tangible asset related to each transfer station and landfill listed, 
including all fee simple or ownership rights to offices, garages, 
related facilities, capital equipment, trucks and other vehicles, 
scales, power supply equipment, and supplies; and all of defendants' 
rights, titles, and interests in any related intangible assets, 
including all leasehold interests and renewal rights thereto, permits, 
customer lists, contracts, and accounts, or options to purchase any 
adjoining property. Relevant Disposal Assets, as used herein, includes 
each of the following:

1. Landfills and Landfill Disposal Agreements

a. Charlotte, North Carolina
    Allied's Anson County Landfill, located at 375 Allied Road, 
Polkton, North Carolina 28135;
b. Cleveland, Ohio
    Allied's Superior Oakland Marsh Landfill, located at 170 Noble Road 
East, Shiloh, Ohio 44878;
 c. Denver, Colorado
    Republic's Front Range Landfill, located at 1830 Weld Company Road 
5, Erie, Colorado 80516;
 d. Flint, Michigan
    Republic's Brent Run Landfill, located at 8247 Vienna Road, 
Montrose, Michigan 48457;
e. Fort Worth, Texas
    At the Acquirer's option, (i) Allied's Turkey Creek Landfill, 
located at 9100 South I-35 West Exit 21, Alvarado, Texas 76009, or (ii) 
all of Allied's rights, titles, and interests in the Fort Worth 
Southeast Landfill, located at 6900 Dick Price Road, Kennedale, Texas 
76060, provided that the City of Fort Worth, owner of the Fort Worth 
Southeast Landfill, approves in advance the sale or assignment of 
Allied's rights, titles, and interests in the landfill to the Acquirer. 
If an Acquirer opts to purchase all of Allied's rights, titles, and 
interests in the Fort Worth Southeast Landfill, defendants will use 
their best efforts to secure the City of Fort Worth's approval.
f. Greenville-Spartanburg, South Carolina
    Allied's Anderson Regional Landfill, located at 203 Landfill Road, 
Anderson, South Carolina 29627;
g. Houston, Texas
    (1) Republic's Seabreeze Environmental Landfill, located at 10310 
FM-523, Angleton, Texas 77515; and
    (2) Rights to landfill disposal, at rates to be negotiated, at 
Allied's Blue Ridge Landfill, located at 2200 FM-521 Road, Fresno, 
Texas 77545, pursuant to which defendants will reserve capacity for an 
Acquirer for MSW disposal under the following minimum terms and 
conditions:
    a. A term of ten (10) years from the date of sale of the Relevant 
Hauling Assets for the Houston, Texas area;
    b. The Acquirer may dispose of 600 tons per day of MSW (``Minimum 
Disposal Amount'') and no more than 1,000 tons per day of direct-haul 
MSW (``Maximum Disposal Amount'') at the Blue Ridge Landfill (``Maximum 
Disposal Amount''), during each six (6) calendar month period during 
the term of the agreement, to be pro rated for any partial periods at 
the beginning and end of the agreement. The agreement may also provide 
that if the Acquirer disposes of less than the prevailing Minimum 
Disposal Amount during any such six (6) month period, then the Minimum 
Disposal Amount and the Maximum Disposal Amount may be reduced for the 
remainder of the disposal agreement term by a tonnage amount equal to 
the shortfall amount.
    c. For the Acquirer of the landfill disposal agreement, defendants 
must commit to operate the Blue Ridge Landfill gates, scale houses, and 
disposal areas under terms and conditions no less favorable than those 
provided to defendants' own vehicles or to the vehicles of any 
municipality in the metropolitan Houston area, except as to price and 
credit terms; and
    d. At any time during the life of the agreement, the Acquirer has 
the right to terminate the agreement upon ninety (90) days' written 
notice to defendants.
h. Los Angeles, California
    Republic's Chiquita Canyon Sanitary Landfill, 29201 Henry Mayo 
Drive, Valencia, California 91355;
i. Northwest Indiana
    At the option of the Acquirer of the Valparaiso Transfer Station, 
landfill disposal rights, at rates to be negotiated, at Allied's Newton 
County Development Corporation Landfill (``Newton County Landfill''), 
located at 2266 East 500 South Road, Brook, Indiana 47922, pursuant to 
which defendants will offer to reserve 350 tons per day of capacity for 
an Acquirer for MSW disposal at Newton County Landfill, under the 
following minimum terms and conditions:
    (1) A term of two (2) years from the date of sale of the Valparaiso 
Transfer Station;
    (2) The Acquirer may dispose of up to 350 tons per day of MSW at 
Newton County Landfill;
    (3) For the Acquirer of the landfill disposal agreement, defendants 
must commit to operate the Newton County Landfill gates, scale houses, 
and disposal areas under terms and conditions no less favorable than 
those provided to defendants' own vehicles or to the vehicles of any 
municipality in the Northwest Indiana area, except as to price and 
credit terms; and
    (4) At any time during the life of the agreement, the Acquirer has 
the right to terminate the agreement upon thirty (30) days' written 
notice to defendants.
j. Philadelphia, Pennsylvania
    At the option of the Acquirer of the Girard Point Transfer Station 
and the Philadelphia Recycling and Transfer Station, rights to landfill 
disposal, at rates to be negotiated, at Republic's Modern Landfill, 
located at 4400 Mount Pisgah Road, York, Pennsylvania 17402, pursuant 
to which defendants will reserve capacity for an Acquirer for MSW 
disposal at Modern Landfill, under the following minimum terms and 
conditions:
    (1) A term of eighteen (18) months from the date of sale of the 
Girard Point Transfer Station and the Philadelphia Recycling and 
Transfer Station;
    (2) The Acquirer may dispose of up to 1300 tons per day of MSW at 
the Modern Landfill;
    (3) For the Acquirer of the landfill disposal agreement, defendants 
must commit to operate the Modern Landfill gates, scale houses, and 
disposal areas under terms and conditions no less favorable than those 
provided to defendants' own vehicles or to the vehicles of any 
municipality in the

[[Page 76392]]

Philadelphia, Pennsylvania area, except as to price and credit terms; 
and
    (4) At any time during the life of the agreement, the Acquirer has 
the right to terminate the agreement upon thirty (30) days' written 
notice to defendants.
k. San Francisco, California
    Republic's Potrero Hills Sanitary Landfill, located at 3675 Potrero 
Hills Lane, Suisun, California 94585, except that Republic need not 
convey (i) the right to control the location of disposal for waste 
volumes that Republic has disposed of at Potrero Hills Sanitary 
Landfill via transfer through the Golden Bear Transfer Station or 
contracts covering the disposal of such waste, or (ii) contracts 
between the Republic subsidiary that owns Potrero Hills Sanitary 
Landfill and Alameda County Industries to the extent those contracts 
govern disposal of waste at Vasco Road Landfill.

2. Transfer Stations

a. Atlanta, Georgia
    (i) Republic's Central Gwinnett Transfer Station, located at 535 
Seaboard Industrial Drive, Lawrenceville, Georgia 30045; and
    (ii) Allied's BFI Smyrna Transfer Station, located at 4696 South 
Cobb Drive, Smyrna, Georgia 30080;
b. Cape Girardeau, Missouri
    Allied's Jackson Solid Waste Transfer Station, located at 2004 Lee 
Avenue, Hwy 25 N, Jackson, Missouri 63755;
c. Charlotte, North Carolina
    Republic's Queen City Transfer Station, located at 3130 Jeff Adams 
Drive, Charlotte, North Carolina 28206;
d. Cleveland, Ohio
    Republic's Harvard Road Transfer Station, located at 3227 Harvard 
Road, Newburgh Heights, Ohio 44105;
e. Greenville-Spartanburg, South Carolina
    Allied's Greer Transfer Station, located at 590 Gilliam Road, 
Greer, South Carolina 29651;
f. Houston, Texas
    Republic's Hardy Road Transfer Station, located at 18784 Hardy 
Road, Houston, Texas 77073;
g. Northwest Indiana
    Allied's Valparaiso Transfer Station, located at 3101 Bertholet 
Boulevard, Valparaiso, Indiana 46383; and
h. Philadelphia, Pennsylvania
    (i) Republic's Girard Point Transfer Station, located at 3600 South 
26th Street, Philadelphia, Pennsylvania 19145; and
    (ii) Allied's Philadelphia Recycling and Transfer Station, located 
at 2209 South 58th Street, Philadelphia, Pennsylvania 19143.
    I. ``Relevant Hauling Assets,'' unless otherwise noted, means the 
small container commercial waste collection routes and other assets 
listed below:

1. Atlanta, Georgia

    (a) Allied's small container commercial waste collection routes 
123, 130, 131, 132, 133, 136, 137, 138, 141, 142, 144, 146, and 147; 
and (b) at the Acquirer's option, the hauling facility located at 1581 
Fulenwider Road, Gainesville, Georgia;

2. Cape Girardeau, Missouri

    (a) Allied's small container commercial waste collection routes 790 
and 791; and (b) at the Acquirer's option, the hauling facility located 
at 281 Rambler Road, Jackson, Missouri;

3. Charlotte, North Carolina

    (a) Republic's small container commercial waste collection routes 
A001, A002, A003, A004, A005, A007, A008, A009, A010, and A012; and (b) 
at the Acquirer's option, the hauling facility located at 5516 
Rozzelles Ferry Road, Charlotte, North Carolina;

4. Fort Worth, Texas

    (a) Republic's small container commercial waste collection routes 
VA, VB, VC, VD, and VE; and (b) notwithstanding any other provision of 
this Final Judgment, in the event an Acquirer purchases Allied's 
rights, titles and interests in the Fort Worth Southeast Landfill, the 
Acquirer shall have the option to lease a sufficient portion of the 
Republic yard located at 1212 Harrison Avenue, Arlington, Texas for a 
period of six (6) months with an option to renew for one additional six 
(6) month period, under a lease to permit the Acquirer to support fully 
the operation of the divested small container commercial waste 
collection routes and the potential growth of the divested hauling 
business to include additional routes;

5. Greenville-Spartanburg, South Carolina

    (a) Allied's small container commercial waste collection routes 
701, 704, 705, 708, 714, 718, 719, and 720; and (b) at the Acquirer's 
option, the hauling facility located at 101 Rogers Bridge Road, Duncan, 
South Carolina;

6. Houston, Texas

    (a) Republic's small container commercial waste collection routes 
A002, A004, A005, A006, A008, A009, A010, A011, A012, A017, A024, A027, 
A028, A029, A031, A034, A035, A038, A040, A042, A043, A044, A045, A046, 
A049, A052, A053, A054, A055, A058, A059, and A060; and (b) at the 
Acquirer's option, the hauling facility located at 2010 Wilson Road, 
Houston, Texas;

7. Lexington, Kentucky

    (a) Republic's small container commercial waste collection routes 
31, 32, 34, 36, and 37; and (b) at the Acquirer's option, the hauling 
facility located at 4000 Park Central Court, Nicholasville, Kentucky;

8. Lubbock, Texas

    (a) Allied's small container commercial waste collection routes 
1711, 1713, 1714, 1911, 1912, 1913, and 1914; and (b) at the Acquirer's 
option, the hauling facility located at 1812 CR-60, Lubbock, Texas; and

9. Northwest Indiana

    (a) Allied's small container commercial waste collection routes 
150, 751, 754, 756, and 757; and (b) at the Acquirer's option, the 
hauling facility located at 3101 Bertholet Boulevard, Valparaiso, 
Indiana.
    J. ``Relevant State'' means the state or commonwealth in which the 
Divestiture Assets are located, provided, however, that state or 
commonwealth is a party to this Final Judgment.
    K. ``Small container commercial waste collection'' means the 
business of collecting municipal solid waste from commercial and 
industrial accounts, usually in ``dumpsters'' (i.e., a small container 
with one to ten cubic yards of storage capacity), and transporting or 
``hauling'' such waste to a disposal site by use of a front-end or 
rear-end load truck. Typical small container commercial waste 
collection customers include office and apartment buildings and retail 
establishments (e.g., stores and restaurants). As used herein, ``small 
container commercial waste collection'' does not include small 
container commercial waste collection of franchised routes.
    L. ``MSW'' means municipal solid waste, a term of art used to 
describe solid putrescible waste generated by households and commercial 
establishments. Municipal solid waste does not include special handling 
waste (e.g., waste from manufacturing processes, regulated medical 
waste, sewage and sludge), hazardous waste or waste generated by 
construction or demolition sites.

[[Page 76393]]

III. Applicability

    A. This Final Judgment applies to Republic and Allied, as defined 
above, and all other persons in active concert or participation with 
any of them who receive actual notice of this Final Judgment by 
personal service or otherwise.
    B. If, prior to complying with Sections IV and V of this Final 
Judgment, defendants sell or otherwise dispose of all or substantially 
all of their assets or of lesser business units that include the 
defendants' Divestiture Assets, they shall require the purchaser to be 
bound by the provisions of this Final Judgment. Defendants need not 
obtain such an agreement from the Acquirer of the assets divested 
pursuant to this Final Judgment.

IV. Divestitures

    A. Defendants are ordered and directed, within 90 calendar days 
after the filing of the Complaint in this matter, or five (5) calendar 
days after notice of the entry of this Final Judgment by the Court, 
whichever is later, to divest all Divestiture Assets in a manner 
consistent with this Final Judgment to an Acquirer(s) acceptable to the 
United States in its sole discretion, after consultation with the 
Relevant State. With respect to the Atlanta, Georgia; Cleveland, Ohio; 
Philadelphia, Pennsylvania; and Ft. Worth, Texas areas, the Divestiture 
Assets in each area must be offered for sale to prospective Acquirers 
separately from Divestiture Assets in other areas. All of the 
Divestiture Assets serving any single relevant area shall be sold to 
the same Acquirer, unless defendants receive the prior written consent 
of the United States. The United States, in its sole discretion, after 
consultation with the Relevant State, may agree to one or more 
extensions of this time period not to exceed sixty (60) calendar days 
in total, and shall notify the Court in such circumstances. Defendants 
agree to use their best efforts to divest the Divestiture Assets as 
expeditiously as possible.
    B. In accomplishing the divestitures ordered by this Final 
Judgment, defendants promptly shall make known, by usual and customary 
means, the availability of the Divestiture Assets. Defendants shall 
inform any person making inquiry regarding a possible purchase of the 
Divestiture Assets that they are being divested pursuant to this Final 
Judgment and provide that person with a copy of this Final Judgment. 
Defendants shall offer to furnish to all prospective Acquirers, subject 
to customary confidentiality assurances, all information and documents 
relating to the Divestiture Assets customarily provided in a due 
diligence process except such information or documents subject to the 
attorney-client privilege or work-product doctrine. Defendants shall 
make available such information to the United States at the same time 
that such information is made available to any other person.
    C. Defendants shall provide the Acquirer(s) and the United States 
information relating to all personnel involved in the operation and 
management of the Divestiture Assets to enable the Acquirer(s) to make 
offers of employment. Defendants shall not interfere with any 
negotiations by the Acquirer(s) to employ or contract with any 
defendant employee whose primary responsibility is the operation or 
management of the Divestiture Assets.
    D. Defendants shall permit prospective Acquirers of the Divestiture 
Assets to have reasonable access to personnel and to make inspections 
of the physical facilities of the Divestiture Assets; access to any and 
all environmental, zoning, and other permit documents and information; 
and access to any and all financial, operational or other documents and 
information customarily provided as part of a due diligence process.
    E. Defendants shall warrant to the Acquirer(s) that each asset will 
be operational on the date of sale.
    F. In the event that the Turkey Creek Landfill is not, for any 
reason, fully operational and capable of disposing of at least 675,000 
tons of MSW annually at the time of its divestiture, defendants shall 
be required to divest alternative disposal assets in the Fort Worth, 
Texas area that are sufficient to achieve the purposes of this Final 
Judgment to the satisfaction of the United States, in its sole 
discretion, after consultation with the State of Texas.
    G. Defendants shall not take any action that will impede in any way 
the permitting, operation or divestiture of the Divestiture Assets.
    H. Defendants shall warrant to each Acquirer that there are no 
material defects in the environmental, zoning or other permits 
pertaining to the operation of the Divestiture Assets, and that 
following the sale of the Divestiture Assets, defendants will not 
undertake, directly or indirectly, any challenges to the environmental, 
zoning, or other permits relating to the operation of the Divestiture 
Assets.
    I. Unless the United States, after consultation with the Relevant 
State, otherwise consents in writing, the divestitures pursuant to 
Section IV, or by trustee appointed pursuant to Section V, of this 
Final Judgment, shall include all the Divestiture Assets, and shall be 
accomplished in such a way as to satisfy the United States, in its sole 
discretion, after consultation with the Relevant State, that the 
divestiture will achieve the purposes of this Final Judgment and that 
the Divestiture Assets can and will be used by an Acquirer(s) as part 
of a viable, ongoing disposal or hauling business in each relevant 
area. The divestitures, whether pursuant to Section IV or Section V of 
this Final Judgment:
    (1) Shall be made to an Acquirer(s) that, in the United States's 
sole judgment, after consultation with the Relevant State, has the 
intent and capability (including the necessary managerial, operational, 
technical and financial capability) of competing effectively in the 
disposal or hauling business; and
    (2) Shall be accomplished so as to satisfy the United States, in 
its sole discretion, after consultation with the Relevant State, that 
none of the terms of any agreement between an Acquirer(s) and 
defendants gives defendants the ability unreasonably to raise the 
Acquirer's costs, to lower the Acquirer's efficiency, or otherwise to 
interfere in the ability of the Acquirer to compete effectively.

V. Appointment of Trustee

    A. If defendants have not divested the Divestiture Assets within 
the time period specified in Section IV, Paragraph A, defendants shall 
notify the United States of that fact in writing. Upon application of 
the United States, the Court shall appoint a trustee selected by the 
United States and approved by the Court to effect the divestiture of 
the Divestiture Assets.
    B. After the appointment of a trustee becomes effective, only the 
trustee shall have the right to sell the Divestiture Assets. The 
trustee shall have the power and authority to accomplish the 
divestitures to an Acquirer(s) acceptable to the United States, after 
consultation with the Relevant State, at such price and on such terms 
as are then obtainable upon reasonable effort by the trustee, subject 
to the provisions of Sections IV, V and VI of this Final Judgment, and 
shall have such other powers as this Court deems appropriate. Subject 
to Section V, Paragraph D of this Final Judgment, the trustee may hire 
at the defendants' cost and expense any investment bankers, attorneys, 
or other agents, who shall be solely accountable to the trustee, 
reasonably necessary in the trustee's judgment to assist in the 
divestitures.

[[Page 76394]]

    C. Defendants shall not object to a sale by the trustee on any 
ground other than the trustee's malfeasance. Any objection by 
defendants on the ground of the trustee's malfeasance must be conveyed 
in writing to the United States and the trustee within ten (10) 
calendar days after the trustee has provided the notice required under 
Section VI.
    D. The trustee shall serve at the cost and expense of defendants, 
on such terms and conditions as the United States approves, and shall 
account for all monies derived from the sale of the assets sold by the 
trustee and all costs and expenses so incurred. After approval by the 
Court of the trustee's accounting, including fees for its services and 
those of any professionals and agents retained by the trustee, all 
remaining money shall be paid to defendants and the trust shall then be 
terminated. The compensation of the trustee and any professionals and 
agents retained by the trustee shall be reasonable in light of the 
value of the Divestiture Assets and based on a fee arrangement 
providing the trustee with an incentive based on the price and terms of 
the divestitures and the speed with which they are accomplished, but 
timeliness is paramount.
    E. Defendants shall use their best efforts to assist the trustee in 
accomplishing the required divestitures. The trustee and any 
consultants, accountants, attorneys, and other persons retained by the 
trustee shall have full and complete access to the personnel, books, 
records, and facilities of the business to be divested, and defendants 
shall develop financial and other information relevant to such business 
as the trustee may reasonably request, subject to reasonable protection 
for trade secret or other confidential research, development, or 
commercial information. Defendants shall take no action to interfere 
with or to impede the trustee's accomplishment of the divestitures.
    F. After its appointment, the trustee shall file monthly reports 
with the United States, the Relevant State, and the Court setting forth 
the trustee's efforts to accomplish the divestitures ordered under this 
Final Judgment. To the extent such reports contain information that the 
trustee deems confidential, such reports shall not be filed in the 
public docket of the Court. Such reports shall include the name, 
address, and telephone number of each person who, during the preceding 
month, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry about acquiring, any interest in the Divestiture Assets, and 
shall describe in detail each contact with any such person. The trustee 
shall maintain full records of all efforts made to divest the 
Divestiture Assets.
    G. If the trustee has not accomplished the divestitures ordered 
under this Final Judgment within six (6) months after its appointment, 
the trustee shall promptly file with the Court a report setting forth: 
(1) the trustee's efforts to accomplish the required divestitures; (2) 
the reasons, in the trustee's judgment, why the required divestitures 
have not been accomplished; and (3) the trustee's recommendations. To 
the extent such reports contain information that the trustee deems 
confidential, such reports shall not be filed in the public docket of 
the Court. The trustee shall at the same time furnish such report to 
the United States, which shall have the right to make additional 
recommendations consistent with the purpose of the trust. The Court 
thereafter shall enter such orders as it shall deem appropriate to 
carry out the purpose of the Final Judgment, which may, if necessary, 
include extending the trust and the term of the trustee's appointment 
by a period requested by the United States.

VI. Notice of Proposed Divestiture

    A. Within two (2) business days following execution of a definitive 
divestiture agreement, defendants or the trustee, whichever is then 
responsible for effecting the divestiture required herein, shall notify 
the United States and the Relevant State of any proposed divestiture 
required by Section IV or V of this Final Judgment. If the trustee is 
responsible, it shall similarly notify defendants. The notice shall set 
forth the details of the proposed divestiture and list the name, 
address, and telephone number of each person not previously identified 
who offered or expressed an interest in or desire to acquire any 
ownership interest in the Divestiture Assets, together with full 
details of the same.
    B. Within fifteen (15) calendar days of receipt by the United 
States and the Relevant State of such notice, the United States, in its 
sole discretion, after consultation with the Relevant State, may 
request from defendants, the proposed Acquirer(s), any other third 
party, or the trustee, if applicable, additional information concerning 
the proposed divestiture, the proposed Acquirer, and any other 
potential Acquirer. Defendants and the trustee shall furnish any 
additional information requested within fifteen (15) calendar days of 
the receipt of the request, unless the parties shall otherwise agree.
    C. Within thirty (30) calendar days after receipt of the notice or 
within twenty (20) calendar days after the United States has been 
provided the additional information requested from defendants, the 
proposed Acquirer(s), any third party, and the trustee, whichever is 
later, the United States, in its sole discretion, after consultation 
with the Relevant State, shall provide written notice to defendants and 
the trustee, if there is one, stating whether or not it objects to the 
proposed divestiture. If the United States provides written notice that 
it does not object, the divestiture may be consummated, subject only to 
defendants' limited right to object to the sale under Section V, 
Paragraph C of this Final Judgment. Absent written notice that the 
United States does not object to the proposed Acquirer(s) or upon 
objection by the United States, a divestiture proposed under Section IV 
or Section V shall not be consummated. Upon objection by defendants 
under Section V, Paragraph C, a divestiture proposed under Section V 
shall not be consummated unless approved by the Court.

VII. Notice of Future Acquisitions

    Unless such transaction is otherwise subject to 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''), 
defendants, without providing advance notification to United States and 
the Relevant State, shall not directly or indirectly acquire, any (1) 
interest in any business engaged in a relevant service in a relevant 
area, (2) assets (other than in the ordinary course of business) used 
in a relevant service in a relevant area, (3) capital stock, or (4) 
voting securities of any person that, at any time during the twelve 
(12) months immediately preceding such acquisition, was engaged in MSW 
disposal or small container commercial waste collection in any relevant 
area, where that person's annual revenues in the relevant area from MSW 
disposal and/or small container commercial waste collection service 
were in excess of $500,000 annually. For clarity, this provision also 
applies to an acquisition of disposal facilities that serve a relevant 
area but are located outside the relevant area, whether or not they are 
physically located in the relevant area.
    Such notification shall be provided to the United States 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, except that the information

[[Page 76395]]

requested in Items 5 through 8 of the instructions must be provided 
only about the relevant service. Notification shall be provided at 
least thirty (30) calendar days prior to acquiring any 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 Antitrust 
Division make a written request for additional information, defendants 
shall not consummate the proposed transaction or agreement until thirty 
(30) calendar days after submitting all such additional information. 
Early termination of the waiting periods in this paragraph may be 
requested and, where appropriate, granted in the same manner as is 
applicable under the requirements and provisions of the HSR Act and 
rules promulgated thereunder. This Section shall be broadly construed 
and any ambiguity or uncertainty regarding the filing of notice under 
this Section shall be resolved in favor of filing notice.

                Areas for Which Notice Provision Applies
------------------------------------------------------------------------
         Relevant area                 Counties         Relevant service
------------------------------------------------------------------------
Atlanta, GA...................  Cherokee, Forsyth,      hauling and
                                 Hall, Jackson,          transfer
                                 Barrow, Gwinnett,       station
                                 Walton, DeKalb,         disposal.
                                 Rockdale, Fulton,
                                 Clayton, Cobb and
                                 Paulding Counties.
Cape Girardeau, MO............  Cape Girardeau County.  hauling and
                                                         transfer
                                                         station
                                                         disposal.
Charlotte, NC.................  Mecklenburg County....  hauling and
                                                         transfer
                                                         station and
                                                         landfill
                                                         disposal.
Cleveland, OH.................  Cuyahoga County.......  transfer station
                                                         and landfill
                                                         disposal.
Denver, CO....................  Denver and Arapahoe     landfill
                                 Counties.               disposal.
Flint, MI.....................  Saginaw and Genesee     landfill
                                 Counties.               disposal.
Fort Worth, TX................  Tarrant County........  hauling and
                                                         landfill
                                                         disposal.
Greenville-Spartanburg, SC....  Greenville and          hauling and
                                 Spartanburg Counties.   transfer
                                                         station and
                                                         landfill
                                                         disposal.
Houston, TX...................  Harris County.........  hauling and
                                                         transfer
                                                         station and
                                                         landfill
                                                         disposal.
Lexington, KY.................  Fayette, Jessamine,     hauling.
                                 Woodford, Scott and
                                 Franklin Counties.
Los Angeles, CA...............  Los Angeles County....  landfill
                                                         disposal.
Lubbock, TX...................  Lubbock County........  hauling.
Northwest Indiana.............  Lake, Porter and        hauling and
                                 LaPorte Counties.       transfer
                                                         station
                                                         disposal.
Philadelphia, PA..............  Philadelphia County...  transfer station
                                                         disposal.
San Francisco, CA.............  Contra Costa, Solano    landfill
                                 and Alameda Counties.   disposal.
------------------------------------------------------------------------

VIII. Financing

    Defendants shall not finance all or any part of any purchase made 
pursuant to Section IV or V of this Final Judgment.

IX. Hold Separate

    Until the divestitures required by this Final Judgment have been 
accomplished, defendants shall take all steps necessary to comply with 
the Hold Separate Stipulation and Order entered by this Court. 
Defendants shall take no action that would jeopardize the divestitures 
ordered by this Court.

X. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, and every thirty (30) calendar days thereafter until 
the divestitures have been completed under Section IV or V, defendants 
shall deliver to the United States and the Relevant State an affidavit 
as to the fact and manner of its compliance with Section IV or V of 
this Final Judgment. Each such affidavit shall include the name, 
address, and telephone number of each person who, during the preceding 
thirty (30) calendar days, made an offer to acquire, expressed an 
interest in acquiring, entered into negotiations to acquire, or was 
contacted or made an inquiry about acquiring, any interest in the 
Divestiture Assets, and shall describe in detail each contact with any 
such person during that period. Each such affidavit shall also include 
a description of the efforts defendants have taken to solicit buyers 
for the Divestiture Assets, and to provide required information to 
prospective Acquirers, including the limitations, if any, on such 
information. Assuming the information set forth in the affidavit is 
true and complete, any objection by the United States, after 
consultation with the Relevant State, to information provided by 
defendants, including limitation on information, shall be made within 
fourteen (14) calendar days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, defendants shall deliver to the United States an 
affidavit that describes in reasonable detail all actions defendants 
have taken and all steps defendants have implemented on an ongoing 
basis to comply with Section IX of this Final Judgment. Defendants 
shall deliver to the plaintiffs an affidavit describing any changes to 
the efforts and actions outlined in defendants' earlier affidavits 
filed pursuant to this section within fifteen (15) calendar days after 
the change is implemented.
    C. Defendants shall keep all records of all efforts made to 
preserve and divest the Divestiture Assets until one year after such 
divestitures have been completed.

XI. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of determining whether the Final Judgment should be 
modified or vacated, and subject to any legally recognized privilege, 
from time to time authorized representatives of the United States 
Department of Justice Antitrust Division (``DOJ''), including 
consultants and other persons retained by the United States, shall, 
upon written request of an authorized representative of the Assistant 
Attorney General in charge of the Antitrust Division, and on reasonable 
notice to defendants, be permitted:

[[Page 76396]]

    (1) Access during defendants' office hours to inspect and copy, or 
at the option of the United States, to require defendants to provide 
hard copy or electronic copies of, all books, ledgers, accounts, 
records, data, and documents in the possession, custody, or control of 
defendants, relating to any matters contained in this Final Judgment; 
and
    (2) To interview, either informally or on the record, defendants' 
officers, employees, or agents, who may have their individual counsel 
present, regarding such matters. The interviews shall be subject to the 
reasonable convenience of the interviewee and without restraint or 
interference by defendants.
    B. Upon the written request of an authorized representative of the 
Assistant Attorney General in charge of the Antitrust Division, 
defendants shall submit written reports or responses to written 
interrogatories, under oath if requested, relating to any of the 
matters contained in this Final Judgment as may be requested.
    C. No information or documents obtained by the means provided in 
this section shall be divulged by the United States to any person other 
than an authorized representative of the executive branch of the United 
States, or the Attorney General's Office of any other plaintiff, except 
in the course of legal proceedings to which the United States or any 
other plaintiff 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 the United States, defendants represent and identify in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under Rule 26(c)(1)(G) 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)(1)(G) of the Federal Rules of Civil Procedure,'' then the United 
States shall give defendants ten (10) calendar days' notice prior to 
divulging such material in any legal proceeding (other than a grand 
jury proceeding).

XII. No Reacquisition

    During the term of this Final Judgment, defendants may not 
reacquire any part of the Divestiture Assets, nor may any defendant 
participate in any other transaction that would result in a 
combination, merger, or other joining together of any part of the 
Divestiture Assets with assets of the divesting company.

XIII. Retention of Jurisdiction

    This Court retains jurisdiction to enable any party to this Final 
Judgment to apply to this Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to enforce 
compliance, and to punish violations of its provisions.

XIV. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire ten (10) years from the date of its entry.

XV. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16, including making copies available to the 
public of this Final Judgment, the Competitive Impact Statement, and 
any comments thereon and the United States's responses to comments. 
Based upon the record before the Court, which includes the Competitive 
Impact Statement and any comments and response to comments filed with 
the Court, entry of this Final Judgment is in the public interest.
Date:------------------------------------------------------------------

Court approval subject to procedures of Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sec.  16

United States District Judge

United States District Court for the District of Columbia

    United States of America, State of California, Commonwealth of 
Kentucky, State of Michigan, State of North Carolina, State of Ohio, 
Commonwealth of Pennsylvania, and State of Texas, Plaintiffs, v. 
Republic Services, Inc., and Allied Waste Industries, Inc., Defendants.

Civil Action No.: 1:08-cv-02076.
Description: Antitrust.
Judge: Roberts, Richard W.
Date Stamp: 12/3/2008.

Competitive Impact Statement

    Plaintiff United States of America (``United States''), pursuant to 
Section 2(b) of the Antitrust Procedures and Penalties Act (``APPA''), 
15 U.S.C. 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

    Pursuant to a stock purchase agreement dated June 22, 2008, 
defendant Republic Services, Inc. (``Republic'') plans to acquire all 
of the issued and outstanding voting securities of defendant Allied 
Waste Industries, Inc. (``Allied''). If consummated, the agreement 
would give Republic ownership of all the waste hauling and disposal 
assets held by Allied throughout the United States. The United States 
and the State of California, Commonwealth of Kentucky, State of 
Michigan, State of North Carolina, State of Ohio, Commonwealth of 
Pennsylvania, and State of Texas (the ``States'') filed a civil 
antitrust Complaint on December 3, 2008, seeking to enjoin the proposed 
acquisition. The Complaint alleges that the likely effect of this 
acquisition would be to lessen competition substantially for small 
container commercial waste collection and municipal solid waste 
(``MSW'') disposal services in several markets in violation of Section 
7 of the Clayton Act. This loss of competition would result in 
consumers paying higher prices and receiving fewer services for the 
collection and disposal of MSW.
    At the same time the Complaint was filed, the United States also 
filed a Hold Separate Stipulation and Order and proposed Final 
Judgment, which are designed to eliminate the anticompetitive effects 
of the acquisition. Under the proposed Final Judgment, which is 
explained more fully below, Republic is required within 90 days after 
the filing of the Complaint, or five (5) days after notice of the entry 
of the Final Judgment by the Court, whichever is later, to divest, as 
viable business operations, specified small container commercial waste 
collection and MSW disposal assets. Under the terms of the Hold 
Separate Stipulation and Order, Republic and Allied are required to 
take certain steps to ensure that the assets to be divested will be 
preserved and held separate from their other assets and businesses.
    The United States, the States, and the defendants have stipulated 
that the proposed Final Judgment may be entered after compliance with 
the APPA. Entry of the proposed Final Judgment would terminate this 
action, except that the Court would retain jurisdiction to construe, 
modify, or enforce the provisions of the proposed Final Judgment and to 
punish violations thereof.

II. Description of the Events Giving Rise to the Alleged Violation

1. The Defendants and the Proposed Transaction

    Republic, with revenues in 2007 of approximately $3.2 billion, is 
the nation's third largest waste hauling and disposal company. Allied, 
with 2007

[[Page 76397]]

revenues of approximately $6.1 billion, is the nation's second largest 
waste hauling and disposal company. The proposed transaction, as 
initially agreed to by defendants on June 22, 2008, would lessen 
competition substantially in the provision of non-franchised small 
container commercial waste collection services in the areas of Atlanta, 
Georgia; Cape Girardeau, Missouri; Charlotte, North Carolina; Fort 
Worth, Texas; Greenville-Spartanburg, South Carolina; Houston, Texas; 
Lexington, Kentucky; Lubbock, Texas; and Northwest Indiana. In 
addition, the transaction as initially proposed would lessen 
competition substantially in the provision of MSW disposal services in 
the areas of Atlanta, Georgia; Cape Girardeau, Missouri; Charlotte, 
North Carolina; Cleveland, Ohio; Denver, Colorado; Flint, Michigan; 
Fort Worth, Texas; Greenville-Spartanburg, South Carolina; Houston, 
Texas; Los Angeles, California; Northwest Indiana; Philadelphia, 
Pennsylvania; and San Francisco, California. This acquisition is the 
subject of the Complaint and proposed Final Judgment filed by the 
United States and the States on December 3, 2008.

B. The Competitive Effects of the Transaction

    MSW is solid, putrescible waste generated by households and 
commercial establishments. Waste collection firms, or haulers, contract 
to collect MSW from residential and commercial customers and transport 
the waste to private and public MSW disposal facilities (e.g., transfer 
stations, incinerators, and landfills), which, for a fee, process and 
legally dispose of the waste. Small container commercial waste 
collection is one component of MSW collection, which also includes 
residential and other waste collection. Private waste haulers typically 
contract with customers for the collection of waste generated by 
commercial accounts. MSW generated by residential customers, on the 
other hand, often is collected by local governments or by private 
haulers pursuant to contracts bid by, or franchises granted by, 
municipal authorities. Republic and Allied compete in the collection of 
small container commercial waste and the disposal of MSW.
1. The Effects of the Transaction on Competition in Small Container 
Commercial Waste Collection
a. Small Container Commercial Waste Collection
    Small container commercial waste collection service is the 
collection of MSW from commercial businesses such as office and 
apartment buildings and retail establishments (e.g., stores and 
restaurants) for shipment to, and disposal at, an approved disposal 
facility. Because of the type and volume of waste generated by 
commercial accounts and the frequency of service required, haulers 
organize commercial accounts into routes, and generally use specialized 
equipment to store, collect, and transport MSW from these accounts to 
approved MSW disposal sites. This equipment (e.g., one- to ten-cubic-
yard containers for MSW storage, and front-end load vehicles commonly 
used for collection and transportation of MSW) is uniquely well suited 
for providing small container commercial waste collection service. 
Providers of other types of waste collection services (e.g., 
residential, hazardous waste, and roll-off services) are not good 
substitutes for small container commercial waste collection firms. In 
these types of waste collection efforts, firms use different waste 
storage equipment (e.g., garbage cans or semi-stationary roll-off 
containers) and different vehicles (e.g., rear-load, side-load, or 
roll-off trucks), which, for a variety of reasons, cannot be 
conveniently or efficiently used to store, collect, or transport MSW 
generated by commercial accounts and, hence, rarely are used on small 
container commercial waste collection routes. In the event of a small 
but significant increase in price for small container commercial waste 
collection services, customers would not switch to any other 
alternative. Thus, the Complaint alleges that the provision of small 
container commercial waste collection services constitutes a line of 
commerce, or relevant service, for purposes of analyzing the effects of 
the transaction.
    The Complaint alleges that the provision of small container 
commercial waste collection service takes place in compact, highly 
localized geographic markets. It is expensive to transport MSW long 
distances between collection customers or to disposal sites. To 
minimize transportation costs and maximize the scale, density, and 
efficiency of their MSW collection operations, small container 
commercial waste collection firms concentrate their customers and 
collection routes in small areas. Firms with operations concentrated in 
a distant area cannot easily compete against firms whose routes and 
customers are locally based. Distance may significantly limit a remote 
firm's ability to provide small container commercial waste collection 
service as frequently or conveniently as that offered by local firms 
with nearby routes. Also, local small container commercial waste 
collection firms have significant cost advantages over other firms, and 
can profitably increase their charges to local small container 
commercial waste customers without losing significant sales to firms 
outside the area.
    Applying this analysis, the Complaint alleges that local small 
container waste collection firms, absent competition from other small 
container waste collection firms, could profitably increase charges to 
local customers without losing significant sales to more distant 
competitors in each of the following areas: Atlanta, Georgia; Cape 
Girardeau, Missouri; Charlotte, North Carolina; Fort Worth, Texas; 
Greenville-Spartanburg, South Carolina; Houston, Texas; Lexington, 
Kentucky; Lubbock, Texas; and Northwest Indiana. Accordingly, the 
Complaint alleges that each of these areas constitutes a section of the 
country, or a relevant geographic market, for the purpose of assessing 
the competitive effects of a combination of Republic and Allied in the 
provision of small container commercial waste collection services.
    There are significant entry barriers into small container 
commercial waste collection. A new entrant into small container 
commercial waste collection services must achieve a minimum efficient 
scale and operating efficiencies comparable to those of existing firms 
in order to provide a significant competitive constraint on the prices 
charged by market incumbents. In order to obtain comparable operating 
efficiencies, a new firm must achieve route density similar to existing 
firms. An efficient route usually handles 80 or more customers or 
containers each day. Because most customers have their MSW collected 
once or twice a week, a new entrant must have several hundred small 
container commercial waste customers in close proximity to construct an 
efficient route. However, the incumbent's ability to engage in price 
discrimination and enter into long-term contracts with small container 
commercial waste collection customers can leave too few customers 
available for the entrant in a sufficiently confined geographic area to 
create an efficient route. The incumbent firm can selectively and 
temporarily charge an unbeatably low price to specified customers 
targeted by new entrants. Long-term contracts often run for three to 
five years and may automatically renew or contain large liquidated 
damage provisions for contract termination. Such terms make it more 
costly or difficult for a customer to

[[Page 76398]]

switch to a new small container commercial waste hauler and obtain 
lower prices for its collection service. Because of these factors, a 
new entrant may find it difficult to compete by offering its small 
container commercial waste services at pre-entry price levels 
comparable to the incumbent and may find an increase in the cost and 
time required to form an efficient route, thereby limiting a new 
entrant's ability to build an efficient route and reducing the 
likelihood that the entrant will ultimately be successful.
    The need for route density, the use of long-term contracts with 
restrictive terms, and the ability of existing firms to price 
discriminate raise significant barriers to entry by new firms, which 
likely will be forced to compete at lower than pre-entry price levels. 
Such barriers in the market for small container commercial waste 
collection have allowed incumbent firms to raise prices successfully.
b. Anticompetitive Effects in Small Container Commercial Waste 
Collection Markets
(1) Atlanta, Georgia Area
    Republic is acquiring the hauling assets of Allied in Atlanta, 
Georgia. These assets serve small container commercial waste collection 
customers in Cherokee, Forsyth, Hall, Jackson, Barrow, Gwinnett, 
Walton, DeKalb, Rockdale, Fulton, Clayton, Cobb, and Paulding Counties, 
Georgia. In this area, the proposed acquisition would reduce from four 
to three the number of significant competitors in the collection of 
small container commercial waste. Annual revenue from small container 
commercial waste collection in the Atlanta, Georgia area is 
approximately $60 million. After the acquisition, defendants would have 
approximately 50 percent of the total number of small container 
commercial waste collection routes in the market.
(2) Cape Girardeau, Missouri Area
    Republic is acquiring the hauling assets of Allied in Cape 
Girardeau, Missouri. These assets serve small container commercial 
waste collection customers in Cape Girardeau County, Missouri. In this 
area, the proposed acquisition would reduce from four to three the 
number of significant competitors in the collection of small container 
commercial waste. Annual revenue from small container commercial waste 
collection in the Cape Girardeau, Missouri area is approximately $5 
million. After the acquisition, defendants would have approximately 64 
percent of the total number of small container commercial waste 
collection routes in the market.
(3) Charlotte, North Carolina Area
    Republic is acquiring the hauling assets of Allied in Charlotte, 
North Carolina. These assets serve small container commercial waste 
collection customers in Mecklenburg County, North Carolina. In this 
area, the proposed acquisition would reduce from three to two the 
number of significant competitors in the collection of small container 
commercial waste. Annual revenue from small container commercial waste 
collection in the Charlotte, North Carolina area is approximately $40 
million. After the acquisition, defendants would have approximately 70 
percent of the total number of small container commercial waste 
collection routes in the market.
(4) Fort Worth, Texas Area
    Republic is acquiring the hauling assets of Allied in Fort Worth, 
Texas. These assets serve small container commercial waste collection 
customers in Tarrant County, Texas. In this area, the proposed 
acquisition would reduce from four to three the number of significant 
competitors in the collection of small container commercial waste. 
Annual revenue from small container commercial waste collection in the 
Fort Worth, Texas area is approximately $55 million. After the 
acquisition, defendants would have approximately 42 percent of the 
total number of small container commercial waste collection routes in 
the market, and the two largest competitors would have approximately 70 
percent of the market.
(5) Greenville-Spartanburg, South Carolina Area
    Republic is acquiring the hauling assets of Allied in Greenville-
Spartanburg, South Carolina. These assets serve small container 
commercial waste collection customers in Greenville and Spartanburg 
Counties, South Carolina. In this area, the proposed acquisition would 
reduce from three to two the number of significant competitors in the 
collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Greenville-
Spartanburg, South Carolina area is approximately $41 million. After 
the acquisition, defendants would have approximately 69 percent of the 
total number of small container commercial waste collection routes in 
the market.
(6) Houston, Texas Area
    Republic is acquiring the hauling assets of Allied in Houston, 
Texas. These assets serve small container commercial waste collection 
customers in Harris County, Texas. In this area, the proposed 
acquisition would reduce from three to two the number of significant 
competitors in the collection of small container commercial waste. 
Annual revenue from small container commercial waste collection in the 
Houston, Texas area is approximately $109 million. After the 
acquisition, defendants would have approximately 56 percent of the 
total number of small container commercial waste collection routes in 
the market.
(7) Lexington, Kentucky Area
    Republic is acquiring the hauling assets of Allied in Lexington, 
Kentucky. These assets serve small container commercial waste 
collection customers in Fayette, Jessamine, Woodford, Scott and 
Franklin Counties, Kentucky. In this area, the proposed acquisition 
would reduce from three to two the number of significant competitors in 
the collection of small container commercial waste. Annual revenue from 
small container commercial waste collection in the Lexington, Kentucky 
area is approximately $9 million. After the acquisition, defendants 
would have approximately 75 percent of the total number of small 
container commercial waste collection routes in the market.
(8) Lubbock, Texas Area
    Republic is acquiring the hauling assets of Allied in Lubbock, 
Texas. These assets serve small container commercial waste collection 
customers in Lubbock County, Texas. In this area, the proposed 
acquisition would reduce from four to three the number of significant 
competitors in the collection of small container commercial waste. 
Annual revenue from small container commercial waste collection in the 
Lubbock, Texas area is approximately $18 million. After the 
acquisition, defendants would have approximately 63 percent of the 
total number of small container commercial waste collection routes in 
the market.
(9) Northwest Indiana Area
    Republic is acquiring the hauling assets of Allied in the Northwest 
Indiana area. These assets serve small container commercial waste 
collection customers in Lake, Porter and LaPorte Counties, Indiana. In 
this area, the proposed acquisition would reduce from four to three the 
number of significant competitors in the collection of small container 
commercial waste. Annual revenue from small container commercial waste 
collection in the Northwest Indiana area is

[[Page 76399]]

approximately $2.4 million. After the acquisition, defendants would 
have approximately 44 percent of the total number of small container 
commercial collection routes in the market.
    The Complaint alleges that a combination of Republic and Allied in 
each of these areas would remove a significant competitor in small 
container commercial waste collection services. In each of these 
markets, the resulting increase in concentration, loss of competition, 
and absence of any reasonable prospect of significant new entry or 
expansion by market incumbents likely will result in higher prices for 
the collection of small container commercial waste.
2. The Effects of the Transaction on Competition in the Disposal of 
Municipal Solid Waste
a. Municipal Solid Waste Disposal
    A number of federal, state, and local safety, environmental, 
zoning, and permit laws and regulations dictate critical aspects of 
storage, handling, transportation, processing and disposal of MSW. In 
order to be disposed of lawfully, MSW must be disposed of in a landfill 
or incinerator permitted to accept MSW. Anyone who attempts to dispose 
of MSW in an unlawful manner risks severe civil and criminal penalties. 
In some areas, landfills are scarce because of significant population 
density and the limited availability of suitable land. Accordingly, 
most MSW generated in these areas is burned in an incinerator or 
brought to transfer stations where it is compacted and transported on 
tractor trailer trucks to a more distant permanent MSW disposal site. A 
transfer station is an intermediate disposal site for processing and 
temporary storage of MSW before transfer in bulk to more distant 
landfills or incinerators for final disposal.
    Because of the strict laws and regulations that govern MSW 
disposal, there are no good substitutes for MSW disposal in landfills, 
or incinerators, or at transfer stations located near the source of the 
waste. Firms that compete in MSW disposal can profitably increase their 
charges to haulers of MSW without losing significant sales to any other 
firms. Thus, for purposes of antitrust analysis, MSW disposal 
constitutes a line of commerce, or relevant service, for purposes of 
analyzing the transaction.
    MSW disposal generally occurs in localized markets. Because of 
transportation costs and travel time to more distant MSW disposal 
facilities, a substantial percentage of the MSW generated in an area is 
disposed of in landfills within roughly 25 to 35 miles of the relevant 
geographic market. In certain relevant geographic markets, virtually 
all of the MSW is disposed of in nearby transfer stations due to the 
high costs of transporting MSW and the substantial travel time to other 
MSW disposal facilities based on distance, natural barriers, and 
congested roadways. In the event that all owners of local disposal 
facilities imposed a small but significant increase in the price of 
disposal of MSW, haulers of MSW generated in that area could not 
profitably turn to more distant disposal sites. Firms that compete in 
MSW disposal in these markets, absent competition from other local MSW 
disposal operators, can profitably increase their charges for MSW 
disposal without losing significant sales to more distant MSW disposal 
sites.
    In other relevant geographic markets, because of transportation 
costs and travel time to more distant MSW disposal facilities, a 
substantial percentage of the MSW generated in the area is disposed of 
in landfills often within roughly 25 to 35 miles of the relevant 
geographic market. Firms that compete to dispose of MSW generated in 
these markets can profitably increase their charges for MSW disposal 
without losing significant sales to more distant MSW disposal sites.
    Applying this analysis, the Complaint alleges that in each of the 
following areas, the high costs of transporting MSW and the substantial 
travel time to other disposal facilities based on distance, natural 
barriers and congested roadways, limit the distance that haulers can 
travel economically to dispose of their waste: Atlanta, Georgia; Cape 
Girardeau, Missouri; Charlotte, North Carolina; Cleveland, Ohio; 
Denver, Colorado; Flint, Michigan; Fort Worth, Texas; Greenville-
Spartanburg, South Carolina; Houston, Texas; Los Angeles, California; 
Northwest Indiana; Philadelphia, Pennsylvania; and San Francisco, 
California. Those areas constitute sections of the country, or relevant 
geographic markets, for the purpose of assessing the competitive 
effects of a combination of Republic and Allied in the provision of MSW 
disposal services.
    There are significant barriers to entry in MSW disposal. Obtaining 
a permit to construct a new disposal facility or expand an existing one 
is a costly and time-consuming process that typically takes many years 
to conclude. Local public opposition often increases the time and 
uncertainty of successfully permitting a facility. It is also difficult 
to overcome environmental concerns and satisfy other government 
requirements. In the relevant geographic areas for MSW disposal, entry 
by a new MSW disposal facility would be costly and time-consuming, and 
unlikely to prevent market incumbents from significantly raising prices 
for MSW disposal following the acquisition.
3. Anticompetitive Effects in the Disposal of Municipal Solid Waste
(1) Atlanta, Georgia Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Atlanta, Georgia area. These assets serve MSW disposal customers in 
Cherokee, Forsyth, Hall, Jackson, Barrow, Gwinnett, Walton, DeKalb, 
Rockdale, Fulton, Clayton, Cobb, and Paulding Counties, Georgia. The 
proposed acquisition would reduce from four to three the number of 
significant competitors for MSW disposal in the Atlanta, Georgia area. 
Annual revenue from MSW disposal in this market is approximately $89 
million. After the acquisition, defendants would have approximately 46 
percent of the MSW disposal market.
(2) Cape Girardeau, Missouri Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Cape Girardeau, Missouri area. These assets serve MSW disposal 
customers in Cape Girardeau County, Missouri. The proposed acquisition 
would reduce from three to two the number of significant competitors 
for the MSW disposal in the Cape Girardeau, Missouri area. Annual 
revenue from MSW disposal in this market is approximately $3 million. 
After the acquisition, defendants would have approximately 70 percent 
of the MSW disposal market.
(3) Charlotte, North Carolina Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Charlotte, North Carolina area. These assets serve MSW disposal 
customers in Mecklenburg County, North Carolina. The proposed 
acquisition would reduce from three to two the number of significant 
competitors for the MSW disposal in the Charlotte, North Carolina area. 
Annual revenue from MSW disposal in this market is approximately $69 
million. After the acquisition, defendants would have approximately 80 
percent of the MSW disposal market.
(4) Cleveland, Ohio Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Cleveland, Ohio area. These assets serve MSW disposal customers in 
Cuyahoga County, Ohio. In this area, the proposed acquisition would 
reduce from four to

[[Page 76400]]

three the number of significant competitors for the MSW disposal. 
Annual revenue from MSW disposal in this market is approximately $68 
million. After the acquisition, defendants would have approximately 56 
percent of the MSW disposal market.
(5) Denver, Colorado Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Denver, Colorado area. These assets serve MSW disposal customers in 
Denver and Arapahoe Counties, Colorado. In this area, the proposed 
acquisition would reduce from four to three the number of significant 
competitors for MSW disposal. Annual revenue from MSW disposal in this 
market is approximately $56 million. After the acquisition, defendants 
would have approximately 37 percent of the MSW disposal market, and the 
two largest competitors would have roughly 87 percent.
(6) Flint, Michigan Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Flint, Michigan area. These assets serve MSW disposal customers in 
Saginaw and Genesee Counties, Michigan. In this area, the proposed 
acquisition would reduce from four to three the number of competitors 
for MSW disposal. Annual revenue from MSW disposal in this market is 
approximately $29 million. After the acquisition, defendants would have 
over 51 percent of the MSW disposal market.
(7) Fort Worth, Texas Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Fort Worth, Texas area. These assets serve MSW disposal customers in 
Tarrant County, Texas. In this area, the proposed acquisition would 
reduce from four to three the number of significant competitors for MSW 
disposal. Annual revenue from MSW disposal in this market is 
approximately $84 million. After the acquisition, defendants would have 
over 55 percent of the MSW disposal market.
(8) Greenville-Spartanburg, South Carolina Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Greenville-Spartanburg, South Carolina area. These assets serve MSW 
disposal customers in Greenville and Spartanburg Counties, South 
Carolina. In this area, the proposed acquisition would reduce from 
three to two the number of significant competitors for MSW disposal. 
Annual revenue from MSW disposal in this market is approximately $40 
million. After the acquisition, defendants would have approximately 50 
percent of the MSW disposal market.
(9) Houston, Texas Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Houston, Texas area. These assets serve MSW disposal customers in 
Harris County, Texas. In this area, the proposed acquisition would 
reduce from three to two the number of significant competitors for MSW 
disposal in the Houston, Texas area. Annual revenue from MSW disposal 
in this market is approximately $75 million. After the acquisition, 
defendants would have approximately 70 percent of the MSW disposal 
market.
(10) Los Angeles, California Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Los Angeles, California area. These assets serve MSW disposal customers 
in Los Angeles County, California. In this area, the proposed 
acquisition would reduce from four to three the number of significant 
competitors for MSW disposal. Annual revenue from MSW disposal in this 
market is approximately $372 million. After the acquisition, defendants 
would have approximately 39 percent of the MSW disposal market, and the 
two largest competitors would have 61 percent.
(11) Northwest Indiana Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Northwest Indiana area. These assets serve MSW disposal customers in 
Lake, Porter and LaPorte Counties, Indiana. In this area, the proposed 
acquisition would also reduce from four to three the number of 
significant competitors for MSW disposal. Annual revenue from MSW 
disposal in this market is approximately $28 million. After the 
acquisition, defendants would have approximately 64 percent of the MSW 
disposal market.
(12) Philadelphia, Pennsylvania Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
Philadelphia, Pennsylvania area. These assets serve MSW disposal 
customers in Philadelphia County, Pennsylvania. In this area, the 
proposed acquisition would reduce from three to two the number of 
competitors for MSW disposal. Annual revenue from MSW disposal in this 
market is approximately $126 million. After the acquisition, defendants 
would have approximately 52 percent of the available MSW disposal 
capacity.
(13) San Francisco, California Area
    Republic is acquiring the MSW disposal assets of Allied serving the 
San Francisco, California area. These assets serve MSW disposal 
customers in Contra Costa, Solano and Alameda Counties, California. In 
this area, the proposed acquisition would reduce from three to two the 
number of significant competitors for MSW disposal. Annual revenue from 
MSW disposal in this market is approximately $101 million. After the 
acquisition, defendants would have approximately 50 percent of the MSW 
disposal market.
    The Complaint alleges that a combination of Republic and Allied in 
each of these areas would remove a significant competitor in the market 
for MSW disposal. In each of these markets, the resulting increase in 
concentration, loss of competition, and absence of any reasonable 
prospect of significant new entry or expansion by market incumbents 
likely will result in higher prices for MSW disposal.

III. Explanation of the Proposed Final Judgment

    The divestiture requirements of the proposed Final Judgment will 
eliminate the anticompetitive effects of the acquisition in small 
container commercial waste collection services and MSW disposal 
services in the markets identified in the Complaint by removing 
sufficient collection and disposal assets from the merged firm's 
control and placing them in the hands of a firm that is independent of 
the merged firm and capable of preserving the competition that 
otherwise would have been extinguished by the merger. Specifically, the 
proposed Final Judgment requires defendants, within 90 days after the 
filing of the Complaint, or five (5) days after notice of the entry of 
the Final Judgment by the Court, whichever is later, to divest, as a 
viable ongoing business or businesses, (a) small container commercial 
waste collection assets (e.g., routes, trucks, containers, and customer 
lists) in the areas of Atlanta, Georgia; Cape Girardeau, Missouri; 
Charlotte, North Carolina; Fort Worth, Texas; Greenville-Spartanburg, 
South Carolina; Houston, Texas; Lexington, Kentucky; Lubbock, Texas; 
and Northwest Indiana, and (b) MSW disposal assets (e.g., landfills, 
transfer stations, airspace disposal rights, leasehold rights, garages 
and offices, trucks and vehicles, scales, permits and intangible assets 
such as customer lists and contracts) in the areas of Atlanta, Georgia; 
Cape Girardeau, Missouri; Charlotte, North Carolina; Cleveland, Ohio; 
Denver,

[[Page 76401]]

Colorado; Flint, Michigan; Fort Worth, Texas; Greenville-Spartanburg, 
South Carolina; Houston, Texas; Los Angeles, California; Northwest 
Indiana; Philadelphia, Pennsylvania; and San Francisco, California. The 
assets must be divested to purchasers approved by the United States and 
in such a way as to satisfy the United States that they can and will be 
operated by the purchaser or purchasers as part of a viable, ongoing 
business or businesses that can compete effectively in each relevant 
market. Defendants must take all reasonable steps necessary to 
accomplish the divestitures quickly and shall cooperate with 
prospective purchasers.
    In the event that defendants do not accomplish the divestitures 
within the periods prescribed in the proposed Final Judgment, the Final 
Judgment provides that the Court will appoint a trustee selected by the 
United States to effect the divestitures. If a trustee is appointed, 
the proposed Final Judgment provides that defendants will pay all costs 
and expenses of the trustee. The trustee's commission will be 
structured so as to provide an incentive for the trustee based on the 
price obtained and the speed with which the divestitures are 
accomplished. After his or her appointment becomes effective, the 
trustee will file monthly reports with the Court, United States, and 
the States as appropriate, setting forth his or her efforts to 
accomplish the divestitures. At the end of six months, if the 
divestitures have not been accomplished, the trustee, United States, 
and the States as appropriate, will make recommendations to the Court, 
which shall enter such orders as appropriate in order to carry out the 
purpose of the trust, including extending the trust or the term of the 
trustee's appointment.

A. Divestiture Provisions

    The proposed Final Judgment provides that, for any area in which 
defendants are required to divest assets, all of the assets serving 
that area shall be sold to a single purchaser, unless defendants 
receive the prior written consent of the United States to do otherwise. 
As described below, the divestiture provisions of the proposed Final 
Judgment will eliminate the anticompetitive effects of the acquisition 
in each of the nine markets in which the Complaint alleges harm to 
competition for small container commercial waste collection services 
and in each of the 13 markets in which the Complaint alleges harm to 
competition for MSW disposal. These divestitures will preserve the 
competition that otherwise would have been lost as a result of the 
acquisition.
1. Atlanta, Georgia Area
    Defendants must divest 13 of Allied's approximately 35 small 
container commercial waste collection routes and related assets in the 
Atlanta, Georgia area. The specific routes to be divested are 
identified in the proposed Final Judgment and form an efficient network 
of routes serving the northern and eastern portions of the Atlanta 
area, where Allied and Republic routes overlap most directly and the 
firms compete most intensely. The divestiture of these routes to an 
independent, economically viable acquirer will thus preserve such 
competition and also position the acquirer to expand its service 
throughout the Atlanta area.
    Defendants must also divest to the same acquirer Republic's Central 
Gwinnett Transfer Station in Lawrenceville, Georgia and Allied's BFI 
Smyrna Transfer Station in Smyrna, Georgia to remedy MSW disposal 
concerns in the Atlanta, Georgia area. In this area, transfer stations 
are the primary disposal option for haulers of MSW because MSW 
landfills are generally too far away from collection routes for direct 
hauling to the landfill to be economical. Republic's Central Gwinnett 
Transfer Station is located in the northeastern portion of the Atlanta 
area and provides an efficient MSW disposal option for the acquirer of 
the 13 small container commercial waste collection routes to be 
divested in this market. Allied's BFI Smyrna Transfer Station, which is 
in the western portion of the Atlanta area, is also efficiently 
located. Together, the two transfer stations will provide efficient 
access to disposal for collection routes throughout the Atlanta area. 
The United States' investigation found that there are sufficient 
independent MSW landfills economically reached via these transfer 
stations to allow the acquirer to provide effective disposal 
competition in the Atlanta area, both for its own waste streams as well 
as those of other independent haulers throughout the Atlanta area.
    Paragraph IV(A) of the proposed Final Judgment requires defendants 
to offer the Atlanta area divestiture assets for sale separately from 
the other assets required to be divested, so as to expand the pool of 
potential bidders for the Atlanta area divestiture assets. Local or 
regional waste firms that might wish to combine the Atlanta area 
divestiture assets with their own assets serving this market may not be 
interested in or capable of bidding on the assets to be divested in 
this market if they were offered only as part of a significantly larger 
group of divestiture assets located in multiple markets.
    Pursuant to the terms of the Modified Final Judgment entered in 
United States v. Allied Waste Industries, Inc. & Browning-Ferris 
Industries, Inc., (D.D.C. 1999) (No. 1:99 CV 01962) [hereinafter 
Allied/BFI], Allied was required to divest its Newnan Transfer Station, 
located in Newnan, Georgia. Republic acquired the Newnan Transfer 
Station from Allied and owns it today. Paragraph VIII(A) of the Allied/
BFI Modified Final Judgment prohibits Allied's reacquisition of assets 
that it divested without the prior written consent of the United 
States. Although Republic's acquisition of Allied will recombine this 
transfer station with Allied's other disposal assets in the Atlanta 
area, the United States has consented to this recombination because it 
concluded that the Newnan Transfer Station no longer participates 
meaningfully in the Atlanta market for MSW disposal, and no competitive 
issues exist in the rural areas southwest of Atlanta served by the 
Newnan Transfer Station. Specifically, the United States' investigation 
found that, although Allied used the Newnan Transfer Station to serve 
the Atlanta disposal market as of 1999--and that facility competed 
directly with transfer stations in the Atlanta area that Allied was 
acquiring in the Allied/BFI transaction--the focus of the Newnan 
Transfer Station has changed under Republic ownership, and other 
transfer stations in the Atlanta area now accept the waste streams that 
previously went to the Newnan Transfer Station. Waste flow reports show 
that the Newnan facility disposes of waste generated in rural areas 
southwest of Atlanta and competes much less directly with other 
disposal facilities in the Atlanta area. Accordingly, the United States 
concluded that the proposed acquisition of Allied by Republic, whereby 
Allied's MSW disposal assets would be recombined with the Newnan 
Transfer Station, would not substantially diminish competition for the 
provision of MSW disposal services in the Atlanta, Georgia area. 
Instead, the divestiture of Republic's Central Gwinnett Transfer 
Station and Allied's BFI Smyrna Transfer Station would be an effective 
remedy for the anticompetitive effects of the proposed acquisition on 
MSW disposal in this market.
2. Cape Girardeau, Missouri Area
    Defendants must divest Allied's two routes and related assets that 
serve small container commercial waste collection customers in the Cape

[[Page 76402]]

Girardeau, Missouri area to an independent, economically viable 
competitor. This divestiture encompasses all of Allied's existing small 
container commercial waste collection routes in this market, and the 
acquirer of these assets will therefore fill the same competitive role 
previously occupied by Allied.
    Defendants must also divest to the same acquirer Allied's only 
transfer station in the Cape Girardeau, Missouri area--the Jackson 
Solid Waste Transfer Station in Jackson, Missouri--to remedy MSW 
disposal concerns in this market. In this area, transfer stations are 
the primary disposal option for haulers of MSW because MSW landfills 
are generally too far away from collection routes for direct hauling to 
the landfill to be economical. Allied's Jackson Solid Waste Transfer 
Station has historically provided MSW disposal services for the two 
Allied small container commercial waste collection routes that will be 
divested in this market, and there is sufficient independent MSW 
landfill capacity economically reached via the transfer station to 
enable the acquirer of the divested assets to provide effective 
collection and disposal competition in the Cape Girardeau area.
3. Charlotte, North Carolina Area
    Defendants must divest Republic's ten routes and related assets 
that serve small container commercial waste collection customers in the 
Charlotte, North Carolina area to an independent, economically viable 
competitor. This divestiture encompasses all of Republic's existing 
small container commercial waste collection routes in this area, and 
the acquirer of these assets will therefore fill the same competitive 
role previously occupied by Republic.
    Defendants must also divest to the same acquirer Republic's Queen 
City Transfer Station in Charlotte, North Carolina and Allied's Anson 
County Landfill in Polkton, North Carolina to remedy MSW disposal 
concerns in the Charlotte, North Carolina area. Republic's Queen City 
Transfer Station in Charlotte, North Carolina is the facility Republic 
uses to serve its ten routes in the Charlotte area, and is an efficient 
MSW disposal option. Allied's Anson County Landfill is efficiently 
located relative to the Queen City Transfer Station and possesses ample 
capacity to preserve disposal competition in the Charlotte area once 
divested to an independent, economically viable operator. The proposed 
Final Judgment does not require the divestiture of the landfill used by 
Republic to serve this area--Republic's Uwharrie Environmental Landfill 
in Mount Gilead, North Carolina--because a significant portion of the 
capacity of that landfill, which is farther from the Queen City 
Transfer Station than Allied's Anson County facility, is devoted by 
Republic to serving waste streams from areas to the north of the 
Charlotte area, where the United States' investigation found that there 
was no competitive concern.
4. Cleveland, Ohio Area
    Defendants must divest to a single Acquirer Republic's Harvard Road 
Transfer Station in Newburgh Heights, Ohio and Allied's Superior 
Oakland Marsh Landfill in Shiloh, Ohio to remedy MSW disposal concerns 
in the Cleveland, Ohio area. Republic's Harvard Road Transfer Station 
is a large transfer station that is centrally located in the Cleveland, 
Ohio market. The Superior Oakland Marsh Landfill is efficiently located 
to accept MSW from the divested Harvard Road Transfer Station and other 
transfer stations serving the Cleveland, Ohio area, and it possesses 
ample capacity to preserve disposal competition in the Cleveland area 
once it is divested to an independent, economically viable operator. 
The proposed Final Judgment does not require divestiture of the 
landfill used by Republic to serve waste delivered via the Harvard Road 
Transfer Station--Republic's Countywide Recycling and Disposal Landfill 
in East Sparta, Ohio--because that facility has unresolved 
environmental issues related to its operation that would make it an 
unattractive candidate for divestiture.
    Paragraph IV(A) of the proposed Final Judgment requires defendants 
to offer the Cleveland area divestiture assets for sale separately from 
the other assets required to be divested, so as to expand the pool of 
potential bidders for the Cleveland area divestiture assets. Local or 
regional waste firms that might wish to combine the Cleveland area 
divestiture assets with their own assets serving this market may not be 
interested in or capable of bidding on the assets to be divested in 
this market if they were offered only as part of a significantly larger 
group of divestiture assets located in multiple markets.
5. Denver, Colorado Area
    Defendants must divest Republic's only MSW disposal facility 
serving the Denver, Colorado area--the Front Range Landfill in Erie, 
Colorado--to remedy MSW disposal concerns in this market.
6. Flint, Michigan Area
    Defendants must divest Republic's only actively operating MSW 
disposal facility serving the Flint, Michigan area--the Brent Run 
Landfill in Montrose, Michigan--to remedy MSW disposal concerns in this 
market. The proposed Final Judgment does not require defendants to 
divest an inactive landfill owned by Republic that could serve this 
market--the Tay Mouth Landfill in Birch Run, Michigan--because 
Republic's Brent Run Landfill possesses ample capacity to preserve 
competition once divested to an independent, economically viable 
operator.
7. Fort Worth, Texas Area
    Defendants must divest Republic's five routes and related assets 
that serve small container commercial waste collection customers in the 
Fort Worth, Texas area to an independent, economically viable 
competitor. This divestiture encompasses all of Republic's existing 
small container commercial waste collection routes in this market, and 
the acquirer of these assets will therefore fill the same competitive 
role previously occupied by Republic.
    Defendants must also divest to the same acquirer one of two 
landfills in the Fort Worth area: (1) Allied's Turkey Creek Landfill in 
Alvaredo, Texas, or (2) all of Allied's rights, titles, and interests 
in the Fort Worth Southeast Landfill in Kennedale, Texas, a disposal 
site that Allied leases from the City of Fort Worth. The selection of 
which landfill is to be divested is to be made by the acquirer. The 
divestiture of either of the two Allied landfills to an independent, 
economically viable competitor will eliminate the competitive harm 
caused by the acquisition. Both landfills are located close to Fort 
Worth, Texas, and are efficiently situated to serve this market as MSW 
disposal options.
    If the acquirer selects Allied's Turkey Creek Landfill, which has 
been inactive since 2007, the proposed Final Judgment required 
defendants to warrant to the purchaser that, at the date of sale, the 
landfill will be operational and ensure that it is capable of disposing 
of 675,000 tons of MSW annually, which is the approximate volume 
disposed of during 2005, when the landfill was fully operational. If 
the landfill is not so capable, defendants shall be required to divest 
alternative disposal assets in the Fort Worth area acceptable to the 
United States as sufficient to remedy the competitive harm caused by 
the acquisition.
    If the acquirer selects the Fort Worth Southeast Landfill, which 
Allied leases pursuant to a long-term contract with the City of Fort 
Worth, the acquirer would have to obtain the prior approval

[[Page 76403]]

of Fort Worth to the sale, and the proposed Final Judgment requires 
defendants to use their best efforts to obtain such approval.
    The proposed Final Judgment does not require divestiture of the 
garage facilities used by Republic to serve the routes to be divested. 
Both Republic and Allied own garages that serve the Fort Worth area, 
but both of these facilities are much larger than necessary to serve 
the routes to be divested and are used predominantly to serve 
collection routes (such as residential franchise routes) as to which 
there is no competitive harm. The defendants intend to continue using 
both facilities after the acquisition is consummated. If the acquirer 
selects the Turkey Run Landfill for divestiture, it would be able to 
make use of space at that facility to service trucks used to operate 
the collection routes to be divested. If the acquirer selects the Forth 
Worth Southeast Landfill, the proposed Final Judgment requires the 
defendants to provide the acquirer with an option to lease for up to 
one year a sufficient portion of Republic's garage located in 
Arlington, Texas, to support fully the operation of the five routes to 
be divested as well as the potential growth of the divested collection 
business.
    Paragraph IV(A) of the proposed Final Judgment requires defendants 
to offer the Fort Worth area divestiture assets for sale separately 
from the other assets required to be divested, so as to facilitate bids 
by local or regional waste firms that might wish to combine the Fort 
Worth area divestiture assets--which do not encompass all of the 
collection or disposal assets of either Republic or Allied in this 
area--with their own assets serving this market in order to create a 
more efficient, vertically integrated competitor serving the Fort 
Worth, Texas market. Such firms may not be interested in or capable of 
bidding on the assets to be divested in this market if they were 
offered only as part of a significantly larger group of divestiture 
assets located in multiple markets.
8. Greenville-Spartanburg, South Carolina Area
    Defendants must divest Allied's eight routes and related assets 
that serve small container commercial waste collection customers in the 
Greenville-Spartanburg, South Carolina area to an independent, 
economically viable competitor. This divestiture encompasses all of 
Allied's existing small container commercial waste collection routes in 
this market, and the acquirer of these assets will therefore fill the 
same competitive role previously occupied by Allied.
    Defendants must also divest to the same acquirer all of Allieds MSW 
disposal assets serving the Greenville-Spartanburg, South Carolina 
area--Allied's Greer Transfer Station in Greer, South Carolina, and its 
Anderson Regional Landfill in Anderson, South Carolina--to remedy MSW 
disposal concerns in this market.
9. Houston, Texas Area
    Defendants must divest 32 of Republic's 54 small container 
commercial waste collection routes and related assets in the Houston, 
Texas area. The specific routes to be divested are identified in the 
proposed Final Judgment and form an efficient network of routes serving 
the entire Houston area. The divestiture of these routes to an 
independent, economically viable acquirer will thus preserve 
competition and position the acquirer to expand its service.
    Defendants must also divest Republic's Hardy Road Transfer Station 
in Houston, Texas and Seabreeze Landfill in Angleton, Texas to remedy 
MSW disposal concerns in the Houston, Texas area. Together, these two 
MSW disposal facilities will preserve competition for MSW disposal in 
the Houston area. The proposed Final Judgment does not require the 
divestiture of Republic's interest in two transfer stations owned by 
the City of Houston and operated by Republic under a long-term disposal 
contract and lease. The United States' investigation found that 
competition for that disposal contract would not be adversely affected 
by the proposed transaction.
    In order to provide the acquirer of the divested routes serving the 
southern portion of the Houston area with an efficient direct-haul 
disposal option, the proposed Final Judgment requires that the 
defendants offer the acquirer airspace disposal rights at Republic's 
Blue Ridge Landfill for the term of the proposed Final Judgment. The 
United States contemplates that such an agreement, subject to the 
approval of the United States, would be negotiated between the 
defendants and the acquirer and contain reasonable commercial terms, 
consistent with the proposed Final Judgment.
10. Lexington, Kentucky Area
    Defendants must divest Republic's five routes and related assets 
that serve small container commercial waste collection customers in the 
Lexington, Kentucky area to an independent, economically viable 
competitor. This divestiture encompasses all of Republic's existing 
small container commercial waste collection routes in this market, and 
the acquirer of these assets will therefore fill the same competitive 
role previously occupied by Republic.
11. Lubbock, Texas Area
    Defendants must divest Allied's seven routes and related assets 
that serve small container commercial waste collection customers in the 
Lubbock, Texas area to an independent, economically viable competitor. 
This divestiture encompasses all of Allied's existing small container 
commercial waste collection routes in this market, and the acquirer of 
these assets will therefore fill the same competitive role previously 
occupied by Allied.
12. Northwest Indiana Area
    Defendants must divest five of Allied's nine small container 
commercial waste collection routes and related assets in the Northwest 
Indiana area. The specific routes to be divested are identified in the 
proposed Final Judgment and form an efficient network of routes serving 
the portions of the Northwestern Indiana area where Allied and Republic 
routes overlap most directly and the firms compete most intensely. The 
divestiture of these routes to an independent, economically viable 
acquirer will thus preserve such competition and also position the 
acquirer to expand its service throughout the Northwestern Indiana 
area.
    Defendants must also divest to the same acquirer Allied's 
Valparaiso Transfer Station in Valparaiso, Indiana to remedy MSW 
disposal concerns in the Northwest Indiana area. Allied's Valparaiso 
Transfer Station is centrally located in this area and will allow the 
acquirer to provide efficient access to disposal for collection routes 
throughout the Northwestern Indiana area, including those to be 
divested.
    The United States' investigation found that there are sufficient 
independent MSW landfills economically reached via the Valparaiso 
Transfer Station to allow the acquirer to provide effective disposal 
competition in the Northwestern Indiana area. To facilitate the 
acquirer's transition of waste streams served by this transfer stations 
to other landfills, the proposed Final Judgment requires that the 
purchaser of the transfer station be offered the option of entering a 
disposal agreement providing access to up to 350 tons per day of 
capacity for up to two years at Allied's Newton County Development 
Corporation Landfill in Brook, Indiana for the final disposal of

[[Page 76404]]

waste received at the transfer station. The United States contemplates 
that such an agreement, subject to the approval of the United States, 
would be negotiated between the defendants and the acquirer and contain 
reasonable commercial terms, consistent with the proposed Final 
Judgment.
13. Los Angeles, California Area
    Defendants must divest Republic's only landfill serving the Los 
Angeles, California area ``the Chiquita Canyon Sanitary Landfill in 
Valencia, California'' to remedy MSW disposal concerns in this market.
14. Philadelphia, Pennsylvania Area
    Defendants must divest Republic's Girard Point Transfer Station and 
Allied's Philadelphia Recycling and Transfer Station, both in 
Philadelphia, Pennsylvania, to remedy MSW disposal concerns in the 
Philadelphia, Pennsylvania area. In this area, transfer stations are 
the primary disposal option for haulers of MSW in this market, because 
roadways in much of the area are highly congested and MSW landfills are 
generally too far away from collection routes for direct hauling to the 
landfill to be economical. Both transfer stations to be divested are 
easily accessible to MSW haulers in this market, and both are located 
in densely populated areas of the market where Republic and Allied 
currently compete to provide MSW disposal services: Republic's Girard 
Point Transfer Station is south of central Philadelphia and Allied's 
Philadelphia Recycling and Transfer Station is located to the west of 
central Philadelphia.
    The United States' investigation found that there are sufficient 
independent MSW landfills economically reached via these transfer 
stations to allow the acquirer to provide effective disposal 
competition in the Philadelphia area. To facilitate the acquirer's 
transition of waste streams served by these transfer stations to other 
landfills--including compliance with municipal regulations requiring 
that any landfill accepting MSW generated in the City of Philadelphia, 
either directly or through a transfer station, be approved in advance--
the proposed Final Judgment requires that the purchaser of the transfer 
stations be offered the option of entering a disposal agreement 
providing access to up to 1,300 tons per day of capacity for up to 18 
months at Republic's Modern Landfill in York, Pennsylvania for the 
final disposal of MSW received at the transfer stations. The United 
States contemplates that such an agreement, subject to the approval of 
the United States, would be negotiated between the defendants and the 
acquirer and contain reasonable commercial terms, consistent with the 
proposed Final Judgment.
    Paragraph IV(A) of the proposed Final Judgment requires defendants 
to offer the Philadelphia area divestiture assets for sale separately 
from the other assets required to be divested, so as to expand the pool 
of potential bidders for the Philadelphia area divestiture assets. 
Local or regional waste firms that might wish to combine the 
Philadelphia area divestiture assets with their own assets serving this 
market may not be interested in or capable of bidding on the assets to 
be divested in this market if they were offered only as part of a 
significantly larger group of divestiture assets located in multiple 
markets.
15. San Francisco, California Area
    Defendants must divest Republic's Potrero Hills Sanitary Landfill 
in Suisun, California to remedy MSW disposal concerns in the San 
Francisco, California area. Republic's Potrero Hills Sanitary Landfill 
has been a significant disposal competitor for MSW generated in this 
market. This divestiture will preserve the competition between the 
Potrero Hills facility and Allied's disposal facilities in this market.
    Pursuant to the terms of the Modified Final Judgment entered in 
Allied/BFI, Allied was required to divest the Vasco Road Landfill, 
located in Livermore, California and serving the San Francisco, 
California area. Republic acquired the Vasco Road Landfill from Allied 
and owns it today. Paragraph VIII(A) of the Allied/BFI Modified Final 
Judgment prohibits Allied's reacquisition of assets that it divested 
without the prior written consent of the United States. Although 
Republic's acquisition of Allied will recombine the Vasco Road Landfill 
with Allied's other disposal assets in the San Francisco area, the 
United States has consented to this recombination. The United States 
has consented because it concluded that the competitive significance of 
the Vasco Road Landfill has diminished considerably since 1999. 
Specifically, Republic's Vasco Road Landfill is not a significant 
competitor to Allied's Keller Canyon Landfill, located in Pittsburg, 
California, for the disposal of MSW generated outside Alameda County 
because of its location and the relatively high taxes levied on each 
ton of MSW disposed at Vasco Road. For disposal of MSW generated in 
Alameda County, Vasco Road faces competition from a large landfill 
located in Alameda County and owned by another firm. Today, the Vasco 
Road Landfill predominantly competes for the disposal of special waste 
(such as contaminated soil), which is not subject to the higher tax 
rate applied to MSW. Accordingly, the United States concluded that the 
proposed acquisition of Allied by Republic, whereby Allied's MSW 
disposal assets would be recombined with the Vasco Road Landfill, would 
not substantially diminish competition for the provision of MSW 
disposal services in the San Francisco, California area, and that the 
divestiture of the Potrero Hills Sanitary Landfill would be an 
effective remedy for the anticompetitive effects of the proposed 
acquisition in this MSW disposal market.

B. Notice of Future Acquisitions

    Paragraph VII of the proposed Final Judgment requires that 
defendants provide advance notification of certain proposed 
acquisitions not otherwise subject to the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, 15 U.S.C. 18a. That provision requires 30 
days' advance written notice to the United States and the relevant 
state before defendants may acquire, directly or indirectly, any 
interest in any business engaged in waste collection or disposal in a 
market as to which the Complaint alleged a violation where the acquired 
business's annual revenues from the relevant service in the market 
exceed $500,000 for the 12 months preceding the proposed acquisition. 
This provision will enable the United States and the States to 
investigate prior to consummation the competitive effects of proposed 
transactions in markets of concern.

IV. Remedies Available to Potential Private Litigants

    Section 4 of the Clayton Act (15 U.S.C. 15) provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the proposed Final Judgment will neither 
impair nor assist the bringing of any private antitrust damage action. 
Under the provisions of Section 5(a) of the Clayton Act (15 U.S.C. 
16(a)), the proposed Final Judgment has no prima facie effect in any 
subsequent private lawsuit that may be brought against the defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States, the States, and defendants have stipulated that 
the proposed Final Judgment may be entered by the Court after 
compliance

[[Page 76405]]

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 a period of at least 60 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 within 60 
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 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 entry. The 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:

Maribeth Petrizzi,
Chief, Litigation II Section, Antitrust Division, United States 
Department of Justice, 1401 H Street, NW., Suite 3000, Washington, DC 
20530.

The proposed Final Judgment provides that the Court retains 
jurisdiction over this 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 against defendants. The 
United States could have continued the litigation and sought 
preliminary and permanent injunctions against Republic's acquisition of 
all of Allied's issued and outstanding voting securities. The United 
States is satisfied, however, that the divestiture of assets and other 
relief described in the proposed Final Judgment will preserve 
competition for small container commercial waste collection services 
and MSW disposal in the relevant markets identified by the United 
States.

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

    The Clayton Act, as amended by 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.'' 15 U.S.C. 16(e)(1). In making that determination, 
the court, in accordance with the statute as amended in 2004, is 
required to consider:

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

15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, 
the court's inquiry is necessarily a limited one as the government is 
entitled to ``broad discretion to settle with the defendant within the 
reaches of the public interest.'' United States v. Microsoft Corp., 56 
F.3d 1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public 
interest standard under the Tunney Act).\1\
---------------------------------------------------------------------------

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

    As the United States Court of Appeals for the District of Columbia 
Circuit has held, under the APPA a court considers, 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 
Microsoft, 56 F.3d at 1458-62. With respect to the adequacy of the 
relief secured by the decree, a court may not ``engage in an 
unrestricted evaluation of what relief would best serve the public.'' 
United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing 
United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see 
also Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 
F. Supp. 2d 37, 40 (D.D.C. 2001). Courts have held that:

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

Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).\2\ In 
determining whether a proposed settlement is in the public interest, a 
district court ``must accord deference to the government's predictions 
about the efficacy of its remedies, and may not require that the 
remedies perfectly match the alleged violations.'' SBC Commc'ns, 489 F. 
Supp. 2d at 17; see also Microsoft, 56 F.3d at 1461 (noting the need 
for courts to be ``deferential to the government's predictions as to 
the effect of the proposed remedies''); United States v. Archer-
Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (noting that 
the court should grant due respect to the United States' prediction as 
to the effect of proposed remedies, its perception of the market 
structure, and its views of the nature of the case).
---------------------------------------------------------------------------

    \2\ Cf. BNS, 858 F.2d at 464 (holding that the court's 
``ultimate authority under the [APPA] is limited to approving or 
disapproving the consent decree''); United States v. Gillette Co., 
406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the 
court is constrained to ``look at the overall picture not 
hypercritically, nor with a microscope, but with an artist's 
reducing glass''). See generally Microsoft, 56 F.3d at 1461 
(discussing whether ``the remedies [obtained in the decree are] so 
inconsonant with the allegations charged as to fall outside of the 
``reaches of the public interest'').
---------------------------------------------------------------------------

    Courts have greater flexibility in approving proposed consent 
decrees than in crafting their own decrees following a finding of 
liability in a litigated matter. ``[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.' '' United States v. Am. Tel. & Tel. Co., 
552 F. Supp. 131, 151 (D.D.C. 1982) (citations omitted) (quoting United 
States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff'd 
sub nom. Maryland v. United States, 460 U.S. 1001 (1983); see also 
United States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 
1985) (approving the consent

[[Page 76406]]

decree even though the court would have imposed a greater remedy). To 
meet this standard, the United States ``need only provide a factual 
basis for concluding that the settlements are reasonably adequate 
remedies for the alleged harms.'' SBC Commc'ns, 489 F. Supp. 2d at 17.
    Moreover, the court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its Complaint, and does not authorize the court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459. Because the ``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 did not pursue. Id. 
at 1459-60. As this Court recently confirmed in SBC Communications, 
courts ``cannot look beyond the complaint in making the public interest 
determination unless the complaint is drafted so narrowly as to make a 
mockery of judicial power.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments, Congress made clear its intent to preserve 
the practical benefits of utilizing consent decrees in antitrust 
enforcement, adding the unambiguous instruction that ``[n]othing in 
this section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. 16(e)(2). The language wrote into the statute 
what Congress intended when it enacted the Tunney Act in 1974, as 
Senator Tunney explained: ``[t]he 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.'' 119 Cong. Rec. 24,598 (1973) (statement 
of Senator Tunney). Rather, the procedure for the public interest 
determination is left to the discretion of the court, with the 
recognition that the court's ``scope of review remains sharply 
proscribed by precedent and the nature of Tunney Act proceedings.'' SBC 
Commc'ns, 489 F. Supp. 2d at 11.\3\
---------------------------------------------------------------------------

    \3\ See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 
(D.D.C. 2000) (noting that the ``Tunney Act expressly allows the 
court to make its public interest determination on the basis of the 
competitive impact statement and response to comments alone''); 
United States v. Mid-Am. Dairymen, Inc., 1977-1 Trade Cas. (CCH) 
'61,508, at 71,980 (W.D. Mo. 1977) (``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 comments in order to determine 
whether those explanations are reasonable under the 
circumstances.''); S. Rep. No. 93-298, 93d Cong., 1st Sess., at 6 
(1973) (``Where the public interest can be meaningfully evaluated 
simply on the basis of briefs and oral arguments, that is the 
approach that should be utilized.'').
---------------------------------------------------------------------------

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.

Dated: December 3, 2008
Respectfully submitted,
/s/
Lowell R. Stern,
DC Bar No. 440487, U.S. Department of Justice, Antitrust Division, 
Litigation II Section, 1401 H Street, NW., Suite 3000, Washington, DC 
20530, (202) 307-0924

 [FR Doc. E8-29603 Filed 12-15-08; 8:45 am]
BILLING CODE 4410-11-P