[Federal Register Volume 75, Number 140 (Thursday, July 22, 2010)]
[Notices]
[Pages 42749-42752]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-17978]


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FEDERAL TRADE COMMISSION

[File No. 091 0032]


Fidelity National Financial, Inc.; Analysis of the Agreement 
Containing Consent Order to Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint and the terms of the consent order -- embodied in the consent 
agreement -- that would settle these allegations.

DATES: Comments must be received on or before August 16, 2010.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form. Comments should refer to ``Fidelity 
National Financial, File No. 091 0032'' to facilitate the organization 
of comments. Please note that your comment -- including your name and 
your state -- will be placed on the public record of this proceeding, 
including on the publicly accessible FTC website, at (http://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as an individual's Social Security 
Number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include any ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential. . . .,'' as provided in 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and Commission Rule 
4.10(a)(2), 16 CFR 4.10(a)(2). Comments containing material for which 
confidential treatment is requested must be filed in paper form, must 
be clearly labeled ``Confidential,'' and must comply with FTC Rule 
4.9(c), 16 CFR 4.9(c).\1\
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR 
4.9(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted by using the following weblink: (https://public.commentworks.com/ftc/fidelitynationalfinancial) and following 
the instructions on the web-based form. To ensure that the Commission 
considers an electronic comment, you must file it on the web-based form 
at the weblink: (https://public.commentworks.com/ftc/fidelitynationalfinancial). If this Notice

[[Page 42750]]

appears at (http://www.regulations.gov/search/index.jsp), you may also 
file an electronic comment through that website. The Commission will 
consider all comments that regulations.gov forwards to it. You may also 
visit the FTC website at (http://www.ftc.gov/) to read the Notice and 
the news release describing it.
    A comment filed in paper form should include the ``Fidelity 
National Financial, File No. 091 0032'' reference both in the text and 
on the envelope, and should be mailed or delivered to the following 
address: Federal Trade Commission, Office of the Secretary, Room H-135 
(Annex D), 600 Pennsylvania Avenue, NW, Washington, DC 20580. The FTC 
is requesting that any comment filed in paper form be sent by courier 
or overnight service, if possible, because U.S. postal mail in the 
Washington area and at the Commission is subject to delay due to 
heightened security precautions.
    The Federal Trade Commission Act (``FTC Act'') and other laws the 
Commission administers permit the collection of public comments to 
consider and use in this proceeding as appropriate. The Commission will 
consider all timely and responsive public comments that it receives, 
whether filed in paper or electronic form. Comments received will be 
available to the public on the FTC website, to the extent practicable, 
at (http://www.ftc.gov/os/publiccomments.shtm). As a matter of 
discretion, the Commission makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC website. More information, including 
routine uses permitted by the Privacy Act, may be found in the FTC's 
privacy policy, at (http://www.ftc.gov/ftc/privacy.shtm).

FOR FURTHER INFORMATION CONTACT: Joseph Lipinsky (206-220-4473), FTC 
Northwest Regional Office, FTC, 600 Pennsylvania Avenue, NW, 
Washington, D.C. 20580.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec.  2.34 the 
Commission Rules of Practice, 16 CFR 2.34, notice is hereby given that 
the above-captioned consent agreement containing a consent order to 
cease and desist, having been filed with and accepted, subject to final 
approval, by the Commission, has been placed on the public record for a 
period of thirty (30) days. The following Analysis to Aid Public 
Comment describes the terms of the consent agreement, and the 
allegations in the complaint. An electronic copy of the full text of 
the consent agreement package can be obtained from the FTC Home Page 
(for July 16, 2010), on the World Wide Web, at (http://www.ftc.gov/os/actions.shtm). A paper copy can be obtained from the FTC Public 
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW, Washington, 
D.C. 20580, either in person or by calling (202) 326-2222.
    Public comments are invited, and may be filed with the Commission 
in either paper or electronic form. All comments should be filed as 
prescribed in the ADDRESSES section above, and must be received on or 
before the date specified in the DATES section.

Analysis of Agreement Containing Consent Order to Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'' or ``FTC'') has 
accepted, subject to final approval, an Agreement Containing Consent 
Order (``Consent Agreement'') from Fidelity National Financial, Inc. 
(``Fidelity''). Fidelity purchased three title insurance subsidiaries 
from LandAmerica Financial, Inc. (``LandAmerica''). The subsidiaries 
were Commonwealth Land Title Insurance Company (``Commonwealth''), 
Lawyers Title Insurance Company (``Lawyers''), and United Capital Title 
Insurance Company (``United''). Fidelity's acquisition of Commonwealth 
and Lawyers created likely anticompetitive effects that the proposed 
Consent Agreement resolves. Under the terms of the proposed Consent 
Agreement, Fidelity is required, among other things, to divest one 
share of its ownership interest in a joint title plant serving the 
Portland, Oregon, metropolitan area, and divest a copy of its title 
data serving Benton, Jackson, Linn, and Marion Counties, in Oregon. 
Additionally, Fidelity will sell a copy of title data that LandAmerica 
had provided to a third party, Data Trace, to a pre-approved purchaser 
to remedy the competitive concern in three counties in the Detroit, 
Michigan, metropolitan area.
    The proposed Consent Agreement has been placed on the public record 
for thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) days, the Commission will again review the 
proposed Consent Agreement, and will decide whether it should withdraw 
from the proposed Consent Agreement, modify it, or make it final.
    On November 25, 2008, Fidelity and LandAmerica entered into an 
acquisition agreement under which Fidelity acquired LandAmerica's title 
insurance subsidiaries for an amount valued, at the time of entering 
into the acquisition agreement, at approximately $258 million 
(``Acquisition''). The Commission's Complaint alleges that Fidelity's 
acquisition violates Section 7 of the Clayton Act, as amended, 15 
U.S.C. Sec.  18, and Section 5 of the Federal Trade Commission Act, as 
amended, 15 U.S.C. Sec.  45, by eliminating an actual, direct, and 
substantial competitor from certain local markets in the United States.

II. Description of the Parties and the Acquisition

    Fidelity, a publicly traded company, is based in Jacksonville, 
Florida. Its title insurance services facilitate the purchase, sale, 
transfer, and finance of residential and commercial real estate. 
Fidelity provides title insurance to residential and commercial 
property buyers and sellers, real estate agents and brokers, 
developers, attorneys, mortgage brokers and lenders, and title 
insurance agents through its subsidiaries, Fidelity National Title 
Company, Title Insurance Company, Ticor Title Insurance Company, 
Commonwealth, and Lawyers.
    LandAmerica was a publicly traded company based in Glen Allen, 
Virginia, that operated through wholly owned subsidiaries. LandAmerica 
generated the majority of its income from its title insurance 
subsidiaries, Commonwealth and Lawyers.
    On Tuesday, December 16, 2008, the United States Bankruptcy Court 
for the Eastern District of Virginia held a hearing on LandAmerica's 
motion to sell its subsidiaries to Fidelity. The bankruptcy court took 
testimony from LandAmerica, Fidelity, the unsecured creditors 
committee, the secured creditors committee, and the FTC. The court 
found that Fidelity's purchase of the LandAmerica title insurance 
subsidiaries was in the best interest of the estate, and approved the 
sale of the subsidiaries to Fidelity.

III. Title Information Services

    Title insurance companies insure clients against the risk that 
clear title is not transferred during the sale of property. Risks 
include failure to detect defective deeds or to discover liens, adverse 
court judgments, or encumbrances created by other security interests. 
In order to conduct title searches in a timely fashion, title insurers 
need access to the most accurate, up-to-date, and conveniently

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arranged title information. That information is found, among other 
places, in title plants, which are private collections of historic and 
current information about the status of title to real property. Because 
title information is essential to conducting a title search, ownership 
of, or access to, a title plant is a title insurer's primary 
competitive asset.

IV. The Complaint

    The Commission's Complaint alleges that Fidelity's acquisition of 
LandAmerica's title insurance subsidiaries may substantially lessen 
competition in the provision of title information services in several 
counties in Oregon, and three counties making up the Detroit, Michigan, 
metropolitan area, in violation of Section 7 of the Clayton Act, as 
amended, 15 U.S.C. Sec.  18, and Section 5 of the Federal Trade 
Commission Act, as amended, 15 U.S.C. Sec.  45.
    The Complaint alleges that the relevant product market in which to 
analyze the effects of the acquisition is the provision of title 
information services. ``Title information services'' means access to 
selected information contained in a title plant that is used to 
determine ownership of, and interests in, real property in connection 
with the underwriting and issuance of title insurance policies.
    The Complaint also alleges that the relevant geographic markets are 
local in nature. Title information is generated and collected on a 
county level and, because of the highly local character of the real 
estate markets in which the title information services are used, 
geographic markets for title information services are highly localized 
and consist of the county or other local jurisdiction embraced by the 
real property information contained in the title plant. The three 
geographic areas of concern outlined in the Complaint are: (1) the tri-
county Portland, Oregon, metropolitan area consisting of Clackamas, 
Multnomah, and Washington Counties; (2) Benton, Jackson, Linn, and 
Marion Counties, in Oregon; and (3) the tri-county Detroit, Michigan, 
metropolitan area consisting of Oakland, Macomb, and Wayne Counties.
    In the Portland, Oregon, metropolitan area, the acquisition of 
LandAmerica's subsidiaries vested Fidelity with a controlling interest 
in the sole title plant providing title insurance information services. 
Absent the proposed relief regarding the title plant serving the 
Portland metropolitan area, Fidelity's acquisition of LandAmerica's 
subsidiaries increases the risk that Fidelity would unilaterally 
restrict or withhold access to title information, thus eliminating the 
potential for a new title insurance company to enter.
    In Benton, Jackson, Linn, and Marion Counties in Oregon, the 
acquisition of LandAmerica's subsidiaries reduced the number of 
independent title plants providing title information services in these 
counties from four to three. Absent the proposed relief in these 
counties, Fidelity's acquisition would increase the risk of collusion 
among the remaining market participants to restrict or withhold access 
to title information, thus eliminating the potential for a new title 
insurance company to enter.
    In three counties in the Detroit, Michigan, metropolitan area, 
Fidelity's purchase of LandAmerica's subsidiaries may give Fidelity the 
power to affect the competitive significance of Data Trace, an 
independent title information services provider. Data Trace, in which 
LandAmerica once had an ownership interest, is a provider of title 
plant information services in the Detroit metropolitan area.
    Based on the facts above, the Complaint alleges that Fidelity's 
acquisition of LandAmerica's subsidiaries could eliminate actual, 
direct, and substantial competition between Fidelity and LandAmerica's 
subsidiaries in the relevant markets; increase Fidelity's ability to 
unilaterally exercise market power in the Detroit and Portland 
metropolitan areas; and substantially increase the level of 
concentration and enhance the probability of coordination in Benton, 
Jackson, Linn, and Marion Counties, in Oregon.
    As stated in the Complaint, entry would not be timely, likely, or 
sufficient to deter or counteract the anticompetitive effects of this 
acquisition. There are relatively long time frames and large capital 
expenses associated with building and maintaining title plants. Among 
other things, intensive time and labor are required in each local 
jurisdiction to develop effective data collection technology and to 
compile historical data.

V. The Terms of the Consent Agreement

    The proposed Consent Agreement will remedy the Commission's 
competitive concerns resulting from Fidelity's acquisition in each of 
the relevant markets discussed above. Pursuant to the proposed Consent 
Agreement, Fidelity will divest one share of its ownership interest in 
a joint title plant that serves the Portland, Oregon, metropolitan area 
to Northwest Title. This will remedy the competitive harm in that local 
market by ensuring that Fidelity no longer owns a majority of the only 
joint title plant serving that market. The proposed Consent Agreement 
also requires Fidelity to divest a copy of each of the title plants 
serving Benton, Jackson, Linn, and Marion Counties, in Oregon to 
Northwest Title. The sale of the title plants in Benton, Jackson, Linn, 
and Marion counties will eliminate the competitive harm that otherwise 
would have resulted in those markets by restoring the number of 
independent title plant owners within each county to the pre-
acquisition level.
    Northwest Title is a privately-held company that is part of a 
family of six companies involved in real estate. Although the company 
will be a new entrant in the relevant markets, it does have experience 
in the title insurance business, and has pre-existing relationships 
with entities and individuals in the real estate market, mortgage 
banking industry, and related businesses. Moreover, Northwest Title is 
financially viable and is positioned to quickly achieve the remedial 
purposes of the proposed Consent Agreement.
    Additionally, pursuant to the proposed Consent Agreement, Fidelity 
will sell a copy of the title data that LandAmerica's subsidiaries had 
provided to Data Trace to a pre-approved purchaser, for the three 
counties making up the Detroit, Michigan, metropolitan area.
    Finally, the proposed Consent Agreement requires Fidelity to 
provide the Commission with prior written notice before acquiring fifty 
(50) percent or more of any joint title plant in the following states: 
California, Colorado, Nevada, New Mexico, Oregon, and Texas. In all of 
these states, Fidelity's acquisition of LandAmerica's subsidiaries 
increased Fidelity's ownership interest in joint title plants. Without 
this prior notification provision, in the future Fidelity could gain a 
controlling interest in joint plants serving these states without the 
FTC's knowledge.

VI. Opportunity for Public Comment

    The Consent Agreement has been placed on the public record for 
thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) days, the Commission will review the Consent 
Agreement again and the comments received and will decide whether it 
should withdraw from the Consent Agreement, modify it, or make it 
final. By accepting the Consent Agreement subject to final approval, 
the

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Commission anticipates that the competitive problems alleged in the 
Complaint will be resolved. The purpose of this analysis is to inform 
and invite public comment on the Consent Agreement, including the 
proposed divestitures, and to aid the Commission in its determination 
of whether to make the Consent Agreement final. This analysis is not 
intended to constitute an official interpretation of the Consent 
Agreement, nor is it intended to modify the terms of the Consent 
Agreement in any way.
    By direction of the Commission.

Donald S. Clark
Secretary.
[FR Doc. 2010-17978 Filed 7-21-10: 7:20 am]
BILLING CODE 6750-01-S