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

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Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. § 16(b)-(h), that Public Comments and the Responses of the United States have been filed with the United States District Court for the District of Columbia in United States v. Fiat S.p.A., Fiat Acquisition Corporation, New Holland N.V., New Holland North America, Inc., and Case Corporation, Civil Action No. 99-02927(JR) (D.D.C. filed Nov. 4, 1999). On November 4, 1999, the United States filed a Complaint alleging that the proposed acquisition of Case Corporation (“Case”) by Fiat S.p.A. and related companies (collectively “Fiat”) would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The proposed Final Judgment, filed at the same time as the Complaint, permits Fiat to acquire Case, but requires that Fiat divest specified assets used in the manufacture and sale of tractors and hay and forage equipment.

Public comment was invited within the statutory 60-day comment period. The two Comments received, and the Responses thereto, have been filed with the Court and are hereby published in the Federal Register. Copies of the Complaint, Hold Separate Stipulation and Order, proposed Final Judgment, Competitive Impact Statement, Public Comments and the Responses of the United States are available for inspection in Room 215 of the Antitrust Division, Department of Justice, 325 7th Street, N.W., Washington, D.C. 20530 (telephone: 202-514-2481) and at the Office of the Clerk of the United States District Court for the District of Columbia, 333 Constitution Avenue, N.W., Washington, D.C.

Copies of any of these materials may be obtained upon request and payment of a copying fee.

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Constance K. Robinson,

Director of Operations and Merger Enforcement Antitrust Division.

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United States Response to Comments

The United States of America hereby files with the Court the written comments that it received in this case, and its responses thereto, and states:

1. The Complaint in this case, the proposed Final Judgment, and the Hold Start Printed Page 10110Separate Stipulation and Order (“Stipulation”) were filed on November 4, 1999. The United States' Competitive Impact Statement was filed on November 19, 1999.

2. Pursuant to 15 U.S.C. § 16(b), the proposed Final Judgment, Stipulation, and Competitive Impact Statement were published in the Federal Register on December 7, 1999 (64 Fed. Reg. 68377-87).

3. Pursuant to 15 U.S.C. § 16(c), a summary of the terms of the proposed Final Judgment and the Competitive Impact Statement were published in The Washington Post, a newspaper of general circulation in the District of Columbia, during the period November 6, 1999 through December 6, 1999.

4. The 60-day comment period specified in 15 U.S.C. § 16(b) ended on February 5, 2000. The United States received two written comments on the proposed settlement: (1) from Mark Zeltwanger of Wyatt Farm Center, on December 27, 1999 (attached as Exhibit 1); and (2) from august P. Hau of Hau Nutrition Service, on November 30, 1999 (attached as Exhibit 3).

5. Pursuant to 15 U.S.C. § 16(d), the United States has considered and responded to these comments. Copies of the United States' responses are attached as Exhibits 2 and 4.

6. The United States is making arrangements to have these comments and the United States' responses thereto published in the Federal Register, pursuant to 15 U.S.C. § 16(d). As soon as that publication has been effected, the United States will notify the Court that it has complied with the requirements of the Antitrust Procedures and Penalties Act (“APPA”), 15 § 16(b)-(d), and that the Court may then enter the proposed Final Judgment after it determines that the Judgment serves the public interest.

Dated: February 9, 2000.

Respectfully submitted,

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Joan Farragher,

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

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Attachment 1

December 27, 1999.

J Robert Kramer II, Chief, Litigation II Section, Antitrust Division, U.S. Department of Justice, 1401 H Street, N.W., Suite 3000, Washington, D.C. 20530.

Dear Sir,

Please be advised that over 1,400 dealers and dealer personnel in North America are very upset over Joel Klein's decision to require New Holland to divest of their Winnipeg, Canada factory and the brand names of Genesis Tractor and versatile tractor in order for the buyout of New Holland and Case-IH to be approved.

To the American farmer this means that one very competitive branch of tractor (New Holland Blue Tractors) has been eliminated from competition and instead of giving the American farmer more choices when he goes to buy a tractor he now only has green or red.

It seems that Mr. Klein did not listen to his staff who tried to tell him this was wrong and succumbed to powerful foreign lobbyists who are only interested in helping their own pockets.

What he has done is already give the John Deere Company a head start in gaining more market share and eventually take over as the only American company producing AG Tractors over 140HP.

Please respond.

Sincerely,

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Mark Zeltwanger,

President and CEO Wyatt Farm Center.

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Attachment 2

February 9, 2000.

Mark Zeltwanger, President and CEO, Wyatt Farm Center, P.O. Box 59, 66400 St. Rd. 331, Wyatt, IN 46595.

Re: Comment on Proposed Final Judgment in United States v. Fiat S.p.A. et al. (D.D.C. filed Nov 4, 1999).

Dear Mr. Zeltwanger:

This letter responds to your December 27, 1999 letter commenting on the proposed Final Judgment in United States v. Fiat S.p.A. et al. (D.D.C. filed Nov 4, 1999), which is currently pending in federal district court in the District of Columbia. The complaint filed by the United States alleges that the proposed acquisition of Case Corporation (“Case”) by Fiat S.p.A. (“Fiat”) would result in a substantial lessening of competition in the manufacture and sale of two-wheel drive (“2WD”) tractors, four-wheel-drive (“4WD”) tractors, and several types of hay and foraging equipment. The proposed Final Judgment would settle the case by requiring the divestiture of New Holland's 2WD and 4WD tractor lines and the sale of Case's interest in Hay and Forage Industries (“HFI”), a joint venture engaged in the manufacture of hay and forage equipment.

In your letter, you express concern that the proposed Final Judgment will result in the elimination of the New Holland tractor lines as a competitive alternative in the marketplace. Specifically, your letter states that “to the American farmer, this [settlement] means that one very competitive brand of tractor (New Holland blue tractors) has been eliminated from competition[,] and instead of giving the American farmer more choice when he goes to buy a tractor he now only has green [John Deere] and red [Case]”.

The United States disagrees with your assertion that the proposed Final Judgment will reduce the choices available to the American farmer when purchasing a new tractor. Far from being eliminated, the proposed Final Judgment requires that the New Holland tractor lines be sold to another company (or companies) with the capability and will to provide substantial competition in the tractor markets. Farmers will still be able to buy the New Holland tractor lines, and will not suffer a reduction in tractor alternatives because of either Fiat's acquisition of Case or the terms of the proposed Final Judgment. The United States strongly believes the divestitures required by the proposed final Judgment will alleviate the competitive concerns alleged in the Complaint and preserve competition in the 2WD and 4WD tractor markets.

Thank you for bringing your concerns to our attention. I trust you appreciate that we have given them due consideration, and hope this response will help alleviate them. Pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. § 16(d), a copy of your comment and this response will be published in the Federal Register and filed with the Court.

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Sincerely yours,

J. Robert Kramer II,

Chief, Litigation II Section.

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Attachment 3

HAU NUTRITION SERVICE

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

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

November 30, 1999.

As an agribusiness professional for 16 years, I write to you with great need to stand up against monopolistic control of agriculture in this country. In recent decades the poultry and pork industries have become vertical monopolies. If you doubt this, just ask any family farmer. Feed and milk cooperatives have been allowed to merge to the point where they ``know'' what their few competitor's price will be in future months! This would make our forefathers ill. Some cooperatives have ``no-compete'' clauses with each other. Is this free trade? Implement companies who used to boast about innovation and produce differentiation are now nesting together in hopes of boosting stockholder profits. There is very little competition left. Meanwhile farm costs continue upward.

The recent merger plans between Case/IH and Ford/New Holland is obviously monopolistic to me and most of my farmer customers. Case and IH should not have been allowed to merge in the first case. Ford and New Holland should not have been allowed to merge either. Obviously all four merging is much worse. John Deere is the only other major manufacturer left . . . so would that merger be approved also?

If this is not clearly unfair competition to the Justice Department, then perhaps anti-trust members should resign and let the free market take over. That could work no worse than what I have seen over the past two decades of my adult life. Most all Americans agree Federal Government is too large and incredibly partisan anyway. Please exert your power and stop this merger (along with the Exxon/Mobil plan). If two companies merge to become the largest company in their industry, isn't it clearly monopolistic and Start Printed Page 10111usually negative for workers and consumers alike?

Sincerely,

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August P. Hau.

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Attachment 4

February 9, 2000.

August P. Hau, Hau Nutrition Service, Hartford, WI 53027.

Re: Comment on Proposed Final Judgment in United States v. Fiat S.p.A. et al. (D.D.C. filed Nov. 4, 1999).

Dear Mr. Hau:

This letter responds to your November 30, 1999 letter commenting on the proposed Final Judgment in United States v. Fiat S.p.A. et al. (D.D.C. filed Nov. 4, 1999), which is currently pending in federal district court in the District of Columbia. The Complaint filed by the United States alleges that the proper acquisition of Case Corporation (``Case'') by Fiat S.p.A. (``Fiat'') would result in a substantial lessening of competition in the manufacture and sale of two-wheel drive (``2WD'') tractors, four-wheel-drive (``4WD'') tractors, and several types of hay and foraging equipment. The proposed Final Judgment would settle the case by requiring the divestiture of New Holland's 2WD and 4WD tractor lines and the sale of Case's interest in Hay and Forage Industries (``HFI''), a joint venture engaged in the manufacture of hay and forage equipment.

In your letter, you express concern that Fiat's acquisition of Case will harm consumers of farm equipment. Specifically, your letter states that: ``If two companies merge to become the largest company in their industry, isn't it clearly monopolistic and usually negative for workers and consumers alike?'' Your letter also expresses concern that ``Case and IH [International Harvester]'' and ``Ford and New Holland should not have been allowed to merge'' in previous transactions.

Although the United States agrees that Fiat's acquisition of Case—if allowed to proceed without the required divestitures—would harm farmers who purchase tractors and hay and forage equipment, the proposed Final Judgment does not simply allow Fiat and Case to merge their agricultural equipment business. The United States strongly believes the divestitures required by the proposed Final Judgment will alleviate the competitive concerns alleged in the Complaint and preserve competition in the manufacture and sale of 2WD tractors, 4WD tractors, and hay and forage equipment. Finally, the United States assures you that it thoroughly investigated the mergers of Case/IH and Ford/New Holland and took appropriate enforcement action.

Thank you for bringing your concerns to our attention. I trust you appreciate that we have given them due consideration, and hope this response will help alleviate them. Pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. § 16(d), a copy of your comment and this response will be published in the Federal Register and filed with the Court.

Sincerely yours,

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J. Robert Kramer II,

Chief, Litigation II Section.

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[FR Doc. 00-4509 Filed 2-24-00; 8:45 am]

BILLING CODE 4410-11-M