Federal Trade Commission.
Proposed Consent Agreement.
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.
Comments must be received on or before December 26, 2006.
Interested parties are invited to submit written comments. Comments should refer to “SCI Alderwoods Group, File No. 061 0156,” to facilitate the organization of comments. A comment filed in paper form should include this reference both in the text and on the envelope, and should be mailed or delivered to the following address: Federal Trade Start Printed Page 70770Commission/Office of the Secretary, Room 135-H, 600 Pennsylvania Avenue, NW., Washington, DC 20580. Comments containing confidential material must be filed in paper form, must be clearly labeled “Confidential,” and must comply with Commission Rule 4.9(c). 16 CFR 4.9(c) (2005). 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. Comments that do not contain any nonpublic information may instead be filed in electronic form as part of or as an attachment to e-mail messages directed to the following e-mail box: email@example.com.
FOR FURTHER INFORMATION CONTACT:
Joseph Brownman (202-326-2605), Bureau of Competition, or Craig Tregillus (202-326-2970), Bureau of Consumer Protection, 600 Pennsylvania Avenue, NW., Washington, DC 20580.End Further Info End Preamble Start Supplemental Information
Pursuant to section 6(f) of the Federal Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and § 2.34 of 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 November 22, 2006), on the World Wide Web, at http://www.ftc.gov/os/2006/11/index.htm. A paper copy can be obtained from the FTC Public Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW., Washington, DC 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
The Federal Trade Commission (“Commission”) has accepted for public comment, subject to final approval, an Agreement Containing Consent Orders (“Consent Agreement”) from Service Corporation International (“SCI”) and Alderwoods Group, Inc. (“Alderwoods”), formerly known as The Loewen Group, Inc. (“Loewen”). The purpose of the Consent Agreement is to remedy the anticompetitive effects that would be likely to result from SCI's purchase of Alderwoods, as alleged in the Complaint the Commission issued with the Consent Agreement. The Consent Agreement has been placed on the public record for thirty (30) days for the receipt of comments from the public. Comments received during this period will become part of the public record. After the thirty (30) day comment period, the Commission will consider the Consent Agreement and the comments received, and will decide whether to withdraw from the Consent Agreement or make it final.
The Consent Agreement provides for relief in 47 local markets in which the Commission in its Complaint alleged the proposed acquisition is anticompetitive. Under the terms of the Consent Agreement, SCI must divest 40 funeral home facilities in 29 local markets and 15 cemetery properties in 12 local markets across the United States. In each of six additional funeral service markets, the Consent Agreement gives SCI the option of either divesting the Alderwoods funeral home(s) it will be acquiring or terminating its licensing agreement with the third-party funeral homes that are providing funeral services in the markets under SCI's Dignity Memorial trademark. In these Dignity Affiliate markets, until the divestitures required by the Consent Agreement, SCI must cease and desist from suggesting prices to those third-party Dignity Affiliates.
The Commission, SCI, and Alderwoods have also agreed to an Order to Hold Separate and Maintain Assets. This order requires SCI and Alderwoods to hold separate and maintain all of the Alderwoods assets in the markets where divestitures are required, pending the required divestitures. To ensure that the Alderwoods assets are properly held separate and maintained, the Commission has appointed William E. Rowe to act as monitor trustee. The eventual acquirers of the assets required to be divested and the manner of their divestiture must receive the prior approval of the Commission. The order also requires SCI to provide the Commission with regular compliance reports demonstrating how it is complying with the terms of the Consent Agreement, until it is in full compliance with that Agreement.
On April 2, 2006, SCI and Alderwoods agreed to SCI's proposed acquisition of Alderwoods for $1.23 billion (a figure that includes the assumption of debt by SCI). The Commission's Complaint alleges that the proposed acquisition, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45, by lessening competition in connection with the provision of funeral services (and associated products) or cemetery services (and associated products and property) in many of the local markets in which SCI and Alderwoods compete.
The purpose of this analysis is to invite public comment on the Consent Agreement, including the proposed required divestitures, to aid the Commission in its determination whether to make final the Consent Agreement. This analysis is not an official interpretation of the Consent Agreement nor does it modify any of its terms. Start Printed Page 70771
II. The Parties and the Transaction
SCI is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Texas, with its office and principal place of business located at 1929 Allen Parkway, Houston, Texas 77019. SCI had sales in 2005 of $1.7 billion. SCI is the nation's largest chain of funeral homes and cemeteries, with about 10% of all related United States revenues.
Alderwoods is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Delaware, with its office and principal place of business located at 311 Elm Street, Suite 1000, Cincinnati, Ohio 45202. Alderwoods had sales in 2005 of approximately $740 million. Alderwoods is the nation's second largest funeral home and cemetery chain, with about 5% of all related United States revenues.
The proposed acquisition is the largest deal of its kind to date in the funeral home and cemetery industry. After the acquisition, SCI will have about 15% of all United States funeral and cemetery service revenues. The Complaint alleges that the proposed acquisition would be anticompetitive in 35 highly concentrated local funeral service markets and 12 highly concentrated cemetery service markets, but not in the nation as a whole. For this reason, the contemplated relief is limited to local markets.
III. The Commission's Complaint
A. The Direct Overlap Markets
According to the Commission's Complaint, SCI and Alderwoods compete in the sale of funeral services  and cemetery services  in over 100 local markets throughout the United States. In highly concentrated local funeral service or cemetery service markets  where SCI and Alderwoods compete, the acquisition will eliminate significant competition between SCI and Alderwoods and, in many of them, substantially increase the likelihood that SCI would be able unilaterally to exercise market power. In many other highly concentrated local funeral service or cemetery service markets where SCI and Alderwoods compete, the acquisition will increase substantially the likelihood that remaining firms in the market will be able to exercise market power through coordinated group behavior. In some markets, the Commission was concerned with both future coordinated interaction and the future exercise of unilateral market power.
1. The Two Ways To Exercise Unilateral Market Power
The Complaint alleges that the acquisition increases the likelihood of SCI unilaterally exercising market power in 19 funeral service markets and nine cemetery service markets. In these markets, SCI is more likely to be able to increase its prices or decrease its services notwithstanding actions taken by other firms already in the market or who may be considering entry. This market power may be exercised in one of two ways. First, in about half of the markets, SCI's post-acquisition market share will approach 100%, and SCI will be in a position to exercise unilateral market power because it will face no real competition. This market power may be exercised by increasing prices or decreasing services. Second, in other markets, SCI will have a significant, but not a monopoly or near monopoly, post-acquisition market share and will also own or control facilities that are the first and second choices for a substantial number of consumers. In these markets, SCI and Alderwoods are now the first and second choices for a substantial number of consumers for several reasons, including: (i) They are the leading providers for certain religious or ethnic groups, including the Jewish or Chinese-American communities; (ii) the proximity of the SCI and Alderwoods facilities makes them the first and second choices for many consumers; or (iii) they are the first and second choice providers of high-end funeral services, which are generally not available at the facilities of nearby competitors. In these markets, SCI's ability to exercise unilateral market power post-acquisition will increase because it will be able to obtain the profit from the combined benefits of (a) the increase in price (or decrease in services) at the facilities of first choice for consumers and (b) the increase in business moving from the facilities of first choice for consumers to their second choices. The Commission alleges that the proposed acquisition would substantially increase concentration, and give SCI a monopoly or near monopoly market share, in 10 funeral service markets (Cartersville, Georgia; Hanford, California; Meridian, Mississippi; Newton, Mississippi; Alhambra, California; Broward County, Florida; Miami-Dade County, Florida; Yuma, Arizona; Yakima, Washington; and Gonzales, Louisiana) and five cemetery service markets (Bradenton/Palmetto, Florida; Broward County, Florida; Fort Myers, Florida; Abilene, Texas; and Baton Rouge, Louisiana). The Commission also alleges that unilateral effects are likely in nine additional funeral service markets (Odessa, Texas; Northern Rockland County, New York; Greensboro, North Carolina; Charlotte, North Carolina; Merced, California; Memphis, Tennessee; Abilene, Texas; Southern Ventura County, California; and Port Orange, Florida) and four additional cemetery service markets (Conroe, Texas; Miami-Dade County, Florida; Ventura County, California; and Macon, Georgia) where, post-merger, SCI will own or operate facilities that are the first and second choices for a substantial number of consumers, and will be in a position profitably to raise prices at one of these facilities.
2. The Exercise of Market Power Through Coordinated Interaction
The Complaint alleges that the acquisition increases the likelihood of SCI exercising market power through coordinated interaction in 15 highly concentrated funeral service markets (Seguin, Texas; Odessa, Texas; Tulare, California; Northern Rockland County, New York; Manassas, Virginia; Baton Rouge, Louisiana; Greensboro, North Carolina; Lansing, Michigan; Abilene, Texas; Killeen, Texas; Merced, California; Lynchburg, Virginia; Lexington/West Columbia, South Carolina; Brownsville, Texas; and Fort Myers, Florida) and four highly concentrated cemetery service markets Start Printed Page 70772(Columbia/Lexington, South Carolina; Nashville, Tennessee; Memphis, Tennessee; and Miami-Dade County, Florida). These increased opportunities for successful coordinated interaction will be due to: (a) An increased ease of agreement upon terms of coordination, (b) the availability of opportunities to monitor compliance with those terms of agreement, and (c) the ability of the firms in the market to control or punish firms that deviate from their terms of agreement.
B. The Dignity Affiliate Markets
The Complaint alleges that in six funeral service markets in which Alderwoods is present, but in which SCI does not own or operate a facility, SCI nevertheless has a competitive presence through a licensing arrangement with third-party funeral service providers, which it refers to as Dignity Affiliates. SCI has authorized third parties to sell SCI trademarked Dignity Memorial funeral services. The Dignity Affiliates were competitors of Alderwoods, but not SCI, prior to the proposed acquisition. After SCI acquires Alderwoods, competition between the Alderwoods facility (which would be owned by SCI post-acquisition) and the Dignity Affiliate is likely to be reduced because it is likely that these firms will cooperate on pricing. Such cooperation on pricing would increase the likelihood that firms in these six markets  would exercise market power through coordinated interaction.
C. “Customs-Conscious” Consumers Sometimes Create Narrow Antitrust Product Markets
The Complaint alleges that in some local markets, some funeral homes or cemeteries cater to specific populations by focusing upon the customs and rituals associated with one or more religious, ethnic, or cultural heritage groups. In some of the local markets addressed in the proposed Consent Agreement, this market segmentation exists in connection with Jewish, Chinese-American, or African-American populations.
Because of the preferences of “customs-conscious” consumers, in some local markets, the alleged product market is limited to facilities that provide the customs and rituals for a specific population. In some other local markets, the alleged product market is limited to facilities that serve the general population but do not provide the customs and rituals that “customs-conscious” consumers require. The determination whether a product market was narrower than all facilities that provided funeral or cemetery services was made on a market-by-market basis. However, if other facilities in that market served both the “customs-conscious” population as well as abroader population, facilities that performed the customs and rituals associated exclusively with respect to a specific population were included in the overall market definition.
D. Entry Conditions
The Complaint alleges that entry would not be timely, likely or sufficient to prevent anticompetitive effects in the specific markets at issue. With regard to these cemetery service markets, entry would be difficult because of the limited availability of land, zoning regulations and other statutory restrictions, and high sunk costs, as well as the lead time necessary to develop a customer base. As concerns entry into the funeral service markets at issue, new entry, if it occurs, is unlikely to prove sufficient to prevent a significant price increase for “traditional” funeral home services of the type offered by most of the parties' homes. If a new traditional funeral home were to enter, it is unlikely that it would make sufficient sales within two years to constrain anticompetitive behavior. Moreover, if “no frills” funeral homes were to enter, it is unlikely that the services that they would offer would be sufficiently close substitutes for traditional funeral home services to prevent a price increase for the latter.
IV. The Consent Agreement
The Commission believes that the Consent Agreement, if made final, would fully restore competition and maintain the competitive status quo ante in the local markets that would have been adversely impacted by the proposed acquisition.
A. The Direct Overlap Markets
In 29 local funeral service markets and 12 local cemetery service markets, the Consent Agreement provides for divestitures of specific properties. The following Table A lists each of the local markets in which the Complaint alleges that the proposed acquisition would be competitively problematic, separately for funeral services and cemetery services. Table A also lists the specific SCI or Alderwoods funeral home facilities that SCI will be required to divest under the Consent Agreement.
1. Funeral Service Markets and the Required Divestitures
|Market area||Properties required to be divested|
|1. Abilene, Texas||Elmwood Funeral Home, 5750 U.S. Highway 277 South, Abilene, Texas (an SCI property).|
|2. Alhambra, California||Universal Chung Wah Funeral Directors, 225 North Garfield Avenue, Alhambra, California (an SCI property).|
|3. Baton Rouge, Louisiana||Resthaven Gardens of Memory Funeral Home, 11817 Jefferson Highway, Baton Rouge, Louisiana (an Alderwoods property).|
|4. Brownsville, Texas||1. Trevino Funeral Home, 1355 Old Port Isabel Road, Brownsville, Texas (an Alderwoods property); and 2. Darling-Mouser Funeral Home, 945 Palm Boulevard, Brownsville, Texas (an Alderwoods property).|
|5. Broward County, Florida||1. Levitt-Weinstein Memorial Chapel, 3201 N.W. 72nd Avenue, Hollywood, Florida (an Alderwoods property); 2. Levitt-Weinstein Memorial Chapel, 8135 West McNab Road, Tamarac, Florida (an Alderwoods property); 3. Levitt-Weinstein Memorial Chapel, 1921 Pembroke Road, Hollywood, Florida (an Alderwoods property); and 4. Levitt-Weinstein Memorial Chapel, 7500 North State Road 7, Coconut Creek, Florida (an Alderwoods property).|
|6. Cartersville, Georgia||Parnick Jennings Funeral Home & Cremation Services, 430 Cassville Road, Cartersville, Georgia (an SCI property).|
|Start Printed Page 70773|
|7. Charlotte, North Carolina||Hankins & Whittington—Dilworth Chapel, 1111 East Boulevard, Charlotte, North Carolina (an Alderwoods property).10|
|8. Fort Myers, Florida||Fort Myers Memorial Gardens Funeral Home, 1589 Colonial Boulevard, Fort Myers, Florida (an SCI property).|
|9. Gonzales, Louisiana||Welsh Funeral Home, 426 West New River Street, Gonzales, Louisiana (an SCI property).11|
|10. Greensboro, North Carolina||Lambeth Troxler Funeral Home, 300 West Wendover Avenue, Greensboro, North Carolina (an SCI property).|
|11. Hanford, California||Whitehurst-McNamara Funeral Service, 100 West Bush Street, Hanford, California (an Alderwoods property).|
|12. Killeen, Texas||Harper-Talasek Funeral Home, 506 North 38th Street, Killeen, Texas (an Alderwoods property).|
|13. Lansing, Michigan||1. Estes-Leadley Greater Lansing Chapel, 325 West Washtenaw Street, Lansing, Michigan (an SCI property); and 2. Estes-Leadley Holt/Delhi Chapel, 2121 Cedar Street, Holt, Michigan (an SCI property).|
|14. Lexington/West Columbia, South Carolina||1. Caughman-Harman Funeral Home, 820 West Dunbar Road, West Columbia, South Carolina (an Alderwoods property); and 2. Caughman-Harman Funeral Home, 5400 Bush River Road, Columbia, South Carolina (an Alderwoods property).12|
|15. Lynchburg, Virginia||1. Diuguid Waterlick Chapel, 21914 Timberlake Road, Lynchburg, Virginia (an Alderwoods property); and 2. Diuguid Funeral Service, 811 Wiggington Road, Lynchburg, Virginia (an Alderwoods property).|
|16. Manassas, Virginia||Lee Funeral Home, 8521 Sudley Road, Manassas, Virginia (an Alderwoods property).|
|17. Memphis, Tennessee||Memorial Park Funeral Home, 5668 Poplar Avenue, Memphis, Tennessee (an Alderwoods property).|
|18. Merced, California||1. Ivers & Alcorn Funeral Home, 901 West Main Street, Merced, California (an SCI property); and 2. Ivers & Alcorn Funeral Home, 3050 Winton Way, Atwater, California (an SCI property).|
|19. Meridian, Mississippi||James F. Webb Funeral Home, 2514 7th Street, Meridian, Mississippi (an SCI property).|
|20. Miami-Dade County, Florida||1. Eternal Light Funeral Directors Inc., 17250 West Dixie Highway, North Miami Beach, Florida (an Alderwoods property); 2. Blasberg-Rubin-Zilbert Funeral Chapel, 720 71st Street, Miami Beach, Florida (an Alderwoods property); and 3. Levitt-Weinstein Memorial Chapels, 18840 West Dixie Highway, North Miami Beach, Florida (an Alderwoods property).13|
|21. Newton, Mississippi||James F. Webb Funeral Home, 100 Old Highway 15 Loop, Newton, Mississippi (an SCI property).|
|22. Odessa, Texas||Sunset Memorial Funeral Home, 6801 East Highway 80, Odessa, Texas (an SCI property).|
|23. Port Orange, Florida||Cardwell & Maloney Funeral Home, 3571 South Ridgewood Avenue, Port Orange, Florida (an Alderwoods property).|
|24. Northern Rockland County, New York||1. T.J. McGowan Sons Funeral Home, 71 North Central Highway, Garnerville, New York (an Alderwoods property); and 2. T.J. McGowan Sons Funeral Home, 133 Broadway, Haverstraw, New York (an Alderwoods property).14|
|25. Seguin, Texas||Palmer Mortuary Inc., 1116 North Austin Street, Seguin, Texas (an Alderwoods property).|
|26. Tulare, California||Miller's Tulare Funeral Home, 151 North H Street, Tulare, California (an Alderwoods property).|
|27. Southern Ventura County, California||Conejo Mountain Funeral Home & Memorial Park, 2052 Howard Road, Camarillo, California (an Alderwoods property).|
|28. Yakima, Washington||Shaw & Sons Funeral Directors, Inc., 201 North 2nd Street, Yakima, Washington (an Alderwoods property).|
|29. Yuma, Arizona||Yuma Mortuary & Crematory, 551 West 16th Street, Yuma, Arizona (an Alderwoods property).|
|10 SCI will retain funeral home assets with the “Hankins & Whittington” name in this market, but, under the terms of the Decision and Order, is permitted to use this name only for a period limited to twelve months.|
|11 SCI will retain funeral homes with the “Welsh” name in this geographic market, and thus the proposed Decision and Order includes a provision that limits the acquirer's use of this name for the divested business to a period of twelve months.|
|12 SCI will retain funeral homes with the “Caughman-Harman” name in this geographic market, and thus the proposed Decision and Order includes a provision that limits the acquirer's use of this name to a period of twelve months.|
|13 SCI will retain funeral homes assets with the “Levitt-Weinstein Memorial Chapel” name in this market, but, under the terms of the Decision and Order, is permitted to use this name only for a period limited to twelve months.|
|14 SCI will retain funeral homes assets with the “T.J. McGowan” name in this market, but, under the terms of the Decision and Order, is permitted to the ongoing use of this name only for a period limited to twelve months.|
2. Cemetery Service Markets and the Required Divestitures
|Market area||Properties required to be divested|
|1. Abilene, Texas||Elmwood Memorial Park, 5750 U.S. Highway 277 South, Abilene, Texas (an SCI property).|
|2. Baton Rouge, Louisiana||Resthaven Gardens of Memory, 11817 Jefferson Highway, Baton Rouge, Louisiana (an Alderwoods property).|
|3. Bradenton/Palmetto, Florida||Skyway Memorial Gardens, 5200 U.S. Highway 19, Palmetto, Florida (an Alderwoods property).|
|4. Broward County, Florida||Beth David Memorial Gardens & Chapel, 3201 N.W. 72nd Avenue, Hollywood, Florida (an Alderwoods property).|
|5. Columbia/Lexington, South Carolina||1. Bush River Memorial Gardens, 5400 Bush River Road, Columbia, South Carolina (an Alderwoods property); 2. Elmwood Cemetery, 501 Elmwood Avenue, Columbia, South Carolina (an Alderwoods property); and 3. Southland Memorial Gardens, 700 West Dunbar Road, West Columbia, South Carolina (an Alderwoods property).|
|6. Conroe, Texas||Conroe Memorial Park, 1600 Porter Road, Conroe, Texas (an Alderwoods property).|
|7. Fort Myers, Florida||Fort Myers Memorial Gardens, 1589 Colonial Boulevard, Fort Myers, Florida (an SCI property).|
|8. Macon, Georgia||Glen Haven Memorial Gardens, 7070 Houston Road, Macon, Georgia (an SCI property).|
|9. Memphis, Tennessee||Memorial Park Inc., 5668 Poplar Avenue, Memphis, Tennessee (an Alderwoods property).|
|10. Miami-Dade County, Florida||1. Graceland Memorial Park North, 4420 S.W. 8th Street, Miami, Florida (an Alderwoods property); and 2. Graceland South Memorial Park, 13900 S.W. 117th Avenue, Miami, Florida (an Alderwoods property).|
|11. Nashville, Tennessee||Spring Hill Cemetery, 5110 Gallatin Pike, Nashville, Tennessee (an Alderwoods property).|
|12. Ventura County, California||Conejo Mountain Funeral Home & Memorial Park, 2052 Howard Road, Camarillo, California (an Alderwoods property).|
B. The Dignity Affiliate Markets
In six funeral service markets, the Consent Agreement requires that SCI, at its option, either divest the Alderwoods property being acquired or terminate the SCI licensing relationship with the third-party Dignity Affiliate. The Consent Agreement also requires that until SCI has complied with this requirement in the markets, SCI shall not enter into or enforce any agreement or exchange information with the Dignity Affiliate regarding actual, suggested, or future prices of funeral services.
Table B lists each of the highly concentrated Dignity Affiliate funeral service markets in which the proposed acquisition would create a competitive problem, together with the remedy.
Funeral Service Markets Where Divestiture or Contract Termination is Required Relief: (a) Properties That May Be Divested Local Market or (b) Dignity Affiliate Contracts That May Be Terminated
|1. Anchorage, Alaska||(a) Alderwoods properties that may be divested: Evergreen Memorial Chapel, 737 East Street, Anchorage, Alaska; Alaska Cremation Center, 3804 Spenard Road, Anchorage, Alaska; and Evergreen's Eagle River Funeral Home, 11046 Chugiak Drive, Eagle River, Alaska; or (b) Third-party contracts that may be terminated: Kehl's Forest Lawn Mortuary, 11621 Old Seward Highway, Anchorage, Alaska; and Witzleben Family Funeral Home, 1707 South Bragaw Street, Anchorage, Alaska.|
|2. Hobbs, New Mexico||(a) Alderwoods property that may be divested: Griffin Funeral Home, 401 North Dalmont, Hobbs, New Mexico; or (b) Third-party contracts that may be terminated: Chapel of Hope, 3321 North Dal Paso Street, Hobbs, New Mexico.|
|3. Klamath Falls, Oregon||(a) Alderwoods property that may be divested: O'Hair & Riggs Funeral Chapel, 515 Pine Street, Klamath Falls, Oregon; or (b) Third-party contracts that may be terminated: Eternal Hills Funeral Home, 4711 Highway 39, Klamath Falls, Oregon.|
|4. Mansfield, Ohio||(a) Alderwoods property that may be divested: Finefrock-Williams Funeral Home, 350 Marion Avenue, Mansfield, Ohio; or (b) Third-party contracts that may be terminated: Wappner Funeral Home, 98 South Diamond Street, Mansfield, Ohio; and Wappner Funeral Home, 100 South Lexington Springmill Road, Mansfield, Ohio.|
|5. Pascagoula, Mississippi||(a) Alderwoods properties that may be divested: Holder Wells Funeral Home, 4007 Main Street, Moss Point, Mississippi; or (b) Third-party contracts that may be terminated: O'Bryant-O'Keefe Funeral Home, 4811 Telephone Road, Pascagoula, Mississippi; and O'Bryant-O'Keefe Gautier Funeral Home, 3290 Ladnier Road, Gautier, Mississippi.|
|Start Printed Page 70775|
|6. Williamsburg, Virginia||(a) Alderwoods property that may be divested: Bucktrout of Williamsburg, 4124 Ironbound Road, Williamsburg, Virginia; or (b) Third-party contracts that may be terminated: Nelsen Funeral Home, 3785 Strawberry Plains Road, Williamsburg, Virginia.|
By direction of the Commission.
Donald S. Clark,
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 Commission Rule 4.9(c), 16 CFR 4.9(c).Back to Citation
2. In mid 1999, Loewen, a Canadian corporation, filed for Chapter 11 bankruptcy protection. It emerged in early 2001 as a Delaware corporation under the Alderwoods name.Back to Citation
3. The Complaint identifies the market share of the parties, concentration levels in each market, and whether the principal anticompetitive concern is the increased likelihood of coordinated interaction among remaining competitors in the market or the exercise by SCI of unilateral market power, or both. The Complaint also alleges that new entry is not likely, or is likely to be insufficient in magnitude to constrain anticompetitive behavior in each of the markets of concern.Back to Citation
4. Funeral services include some or all of the following: family consultation, collection of the deceased and transportation from the place of death to the funeral home, registration of death, embalming and other preparations, sale of a casket, flowers, catering, and other merchandise, use of funeral home facilities by hosting a viewing and ceremony, transportation to a place of worship, conveying the deceased to the cemetery or crematorium, and advance planning.Back to Citation
5. Cemetery services include the traditional products and services offered by perpetual care cemeteries, including burial spaces, opening and closing of graves, memorials and burial vaults, mausoleum spaces, cemetery maintenance and upkeep, and advance planning.Back to Citation
6. In calculating market share, the Commission relied on the number of “calls” (funerals or internments) of each competitor (rather than dollar revenues) because this information was available for all firms in the markets under investigation. For purposes of determining market share as well as calculating market concentration based on the Herfindahl-Hirschman Index (“HHI”), the Commission included all market participants that competed with the funeral homes or cemeteries in the market. In addition, the Commission examined the transaction's competitive effects in each market of concern. As part of this assessment, the Commission excluded fringe competitors (participants that did not act as a competitive constraint in the market), e.g., small firms with less than three percent of the market or facilities that primarily offered direct disposals or direct cremations without attendant services.Back to Citation
7. Market power is the ability of a firm, or group of firms, profitably to reduce output and raise prices above competitive levels or otherwise achieve anticompetitive effects such as by decreasing the quality or level of services.Back to Citation
8. The six markets are identified in Table B, infra.Back to Citation
9. The Complaint and Consent Agreement do not address SCI's licensing arrangements with third-party Dignity Affiliates except in the six highly concentrated markets.Back to Citation
[FR Doc. E6-20591 Filed 12-5-06; 8:45 am]
BILLING CODE 6750-01-P