Notice2026-02185
United States v. Columbus McKinnon Corp., et al.; Proposed Final Judgment and Competitive Impact Statement
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 3, 2026
Issuing agencies
Justice DepartmentAntitrust Division
Full Text
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<title>Federal Register, Volume 91 Issue 22 (Tuesday, February 3, 2026)</title>
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[Federal Register Volume 91, Number 22 (Tuesday, February 3, 2026)]
[Notices]
[Pages 4938-4951]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-02185]
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DEPARTMENT OF JUSTICE
Antitrust Division
United States v. Columbus McKinnon Corp., 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. 16(b)-(h), that a proposed Final Judgment,
Stipulation, and Competitive Impact Statement have been filed with the
United States District Court for the District of Columbia in United
States of America v. Columbus McKinnon Corp., et al., Civil Action No.
1:26-cv-00266. On January 29, 2026, the United States filed a Complaint
alleging that Columbus McKinnon's proposed acquisition of Kito Crosby
Limited 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,
requires Columbus McKinnon to divest its power chain hoists and chains
businesses.
Copies of the Complaint, proposed Final Judgment, and Competitive
Impact Statement are available for inspection on the Antitrust
Division's website at <a href="http://www.justice.gov/atr">http://www.justice.gov/atr</a> 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, including the name of the submitter, and
responses thereto, will be posted on the Antitrust Division's website,
filed with the Court, and, under certain circumstances, published in
the Federal Register. Comments should be submitted in English and
directed to Soyoung Choe, Acting Chief, Defense, Industrials, and
Aerospace Section, Antitrust Division, Department of Justice, 450 Fifth
Street NW, Suite 8700, Washington, DC 20530 (email address: <a href="/cdn-cgi/l/email-protection#85c4d1d7abd5f0e7e9ece6a8c6eae8e8e0ebf1f6a8d1f0ebebe0fca8c4e6f1a8c8c7c5f0f6e1eaefabe2eaf3"><span class="__cf_email__" data-cfemail="6e2f3a3c403e1b0c02070d432d0103030b001a1d433a1b00000b17432f0d1a43232c2e1b1d0a010440090118">[email protected]</span></a>).
Suzanne Morris,
Deputy Director Civil Enforcement Operations, Antitrust Division.
United States District Court for the District of Columbia
United States of America, Plaintiff, v. Columbus Mckinnon
Corporation, KKR North America Fund XI L.P., and Kito Crosby
Limited, Defendants.
No. 1:26-cv-00266-TJK
Judge: Timothy J. Kelly
Complaint
Columbus McKinnon Corporation (``CMCO'') and Kito Crosby Limited
(``Kito Crosby'') are two of the leading manufacturers of electric
chain hoists and overhead lifting chain in the United States. CMCO's
proposed acquisition of Kito Crosby from KKR North America Fund XI L.P.
(``KKR'') may substantially lessen competition in the markets for the
development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain in the United States in violation of
Section 7 of the Clayton Act, 15 U.S.C. 18. The
[[Page 4939]]
proposed transaction should therefore be enjoined.
I. Nature of the Action
1. Pursuant to a stock purchase agreement dated February 10, 2025,
CMCO proposes to acquire all of the outstanding voting securities of
Kito Crosby in exchange for approximately $2.7 billion. As part of the
transaction, CMCO and Clayton, Dubilier & Rice Fund XII, L.P. (``CDR'')
entered into an investment agreement dated February 10, 2025, in which
CDR proposes to purchase approximately 40 percent of the voting
securities of CMCO for approximately $800 million on the condition that
CMCO subsequently close its acquisition of Kito Crosby.
2. Electric chain hoists use a motor-driven chain system to safely
lift and move heavy loads with ease and precision. They are often
integrated with overhead cranes to streamline operations in warehouses,
factories, and production facilities across nearly every industry in
the United States.
3. Overhead lifting chain is welded chain made from alloy steel
that is manufactured and tested in accordance with standards published
by the American Society of Testing & Materials (``ASTM''). Due to their
superior strength and durability, alloy steel chains that meet or
exceed ASTM's specifications are the only chains recommended by the
Occupational Safety and Health Administration (``OSHA''), the National
Association of Chain Manufacturers (``NACM''), and the American Society
of Mechanical Engineers (``ASME'') for use in lifting loads into
positions in which dropping the load would cause bodily injury or
property damage.
4. The proposed acquisition would eliminate competition between
CMCO and Kito Crosby. As a result, the proposed acquisition may
substantially lessen competition in the United States for the
development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain in violation of Section 7 of the
Clayton Act, 15 U.S.C. 18.
II. The Defendants
5. CMCO is incorporated in New York and headquartered in Charlotte,
North Carolina. CMCO produces a wide range of material handling
equipment and is a market leader in the United States for hoists,
material handling digital power control systems, and precision
conveyers. The company has a strong market position in certain chains,
forged fittings, and linear actuator products. In 2024, CMCO had
revenues of approximately $1 billion.
6. Kito Crosby Limited is a private limited company registered in
the United Kingdom and headquartered in Arlington, Texas. Kito Crosby
is a global leader in the lifting and securement hardware industry with
key products including hoists, cranes, and lifting hardware. In 2024,
Kito Crosby had revenues of approximately $1.1 billion. Kito Crosby is
owned by KKR North America Fund XI L.P., a Cayman Islands exempted
limited partnership with its principal place of business in New York,
New York.
III. Jurisdiction and Venue
7. The United States brings this action under Section 15 of the
Clayton Act, 15 U.S.C. 25, as amended, to prevent and restrain
Defendants from violating Section 7 of the Clayton Act, 15 U.S.C. 18.
8. Defendants develop, manufacture, distribute, and sell electric
chain hoists and overhead lifting chain in the flow of interstate
commerce. Defendants' activities in the development, manufacture,
distribution, and sale of these products substantially affect
interstate commerce. This Court has subject matter jurisdiction over
this action pursuant to Section 15 of the Clayton Act, 15 U.S.C. 25,
and 28 U.S.C. 1331, 1337(a), and 1345.
9. Defendants have consented to venue and personal jurisdiction in
this judicial district. 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(b)
and (c).
IV. Background
10. The material handling industry is responsible for the movement,
protection, storage, and control of materials and products through the
process of their manufacture, distribution, consumption, and disposal.
Rigging and lifting equipment are key to material handling as they
facilitate the safe and efficient movement of heavy loads in a wide
range of applications across the American economy. Rigging and lifting
equipment is pervasive in the industrial and manufacturing, oil and
gas, metals and mining, utilities, construction, and automotive
industries.
11. Rigging and lifting equipment includes a variety of hardware,
such as chains and shackles, which attach to a load and enable it to be
raised and lowered with mechanical force by lifting equipment, such as
cranes and hoists. Operating rigging and lifting equipment to move
loads that weigh hundreds or thousands of pounds poses significant risk
of serious injuries or fatalities. Manufacturers of rigging and lifting
equipment, including CMCO and Kito Crosby, compete to provide safe and
reliable products to their customers. To that end, they invest heavily
in manufacturing with quality materials, safety testing, training end
users, and ensuring durability of products in the field.
V. Relevant Markets
12. Electric chain hoists and overhead lifting chain each
constitute a line of commerce as that term is used in Section 7 of the
Clayton Act, and each is a relevant product market in which competitive
effects can be assessed. The geographic market for each relevant
product market is comprised of sales to customers within the United
States.
13. Each of these relevant markets satisfies the well-accepted
``hypothetical monopolist'' test, which asks whether a hypothetical
monopolist of all products sold in a market likely would impose at
least a small but significant and non-transitory increase in price or
other worsening terms (``SSNIPT''). Customers could not turn to
alternative products to avoid such a price increase, nor would they so
significantly reduce their purchases that the SSNIPT would be
unprofitable for the hypothetical monopolist.
a. Electric Chain Hoists
14. Electric chain hoists use a chain driven by an electric motor
to lift, lower, and position heavy materials. Electric chain hoists are
designed to be durable and can be used independently or integrated into
a small overhead crane. Industries across the economy--including
automotive, aerospace, energy, construction, and logistics--rely on
electric chain hoists daily to increase efficiency and reduce strain on
operators.
15. Electric chain hoists vary in capacity, voltages, chain length,
and speed. Electric chain hoists are ideal for lifting lighter loads
(generally less than three tons) and are easy for operators to use.
Although electric chain hoists vary in price depending on their
features, the majority of electric chain hoists sold in the United
States are priced from approximately $2,000 to $6,000.
16. While there are other types of hoists that are designed to
perform the same basic lifting, lowering, and positioning functions as
electric chain hoists, none of the alternatives offer the same value
proposition as electric chain hoists, and therefore are not close
substitutes. These other types of hoists are intended for different
applications and offer different benefits and drawbacks depending on
the environment in which they will be
[[Page 4940]]
used, how much weight will be lifted, and lift frequency. Accordingly,
these other types of hoists are not effective substitutes for electric
chain hoists.
b. Overhead Lifting Chain
17. Chains vary greatly in strength, durability, and reliability
depending on how they are manufactured, metals they are made from, and
size. To ensure safe and proper usage, ASTM recommends certain
specifications for chain used in different applications. The
specifications for chain recommended for use in overhead lifting are
defined by ASTM as ``Grade 80'' and ``Grade 100.'' Overhead lifting
chain is exclusively made from forged alloy steel while lower grade
chain is made from carbon steel or stainless steel.
18. Chain manufacturers market chain as Grade 80 or Grade 100 and
emboss links with the grade for identification purposes. Chains that
meet or exceed these specifications are collectively referred to as
``overhead lifting chain.'' Since lower grades of chain are not
recommended for overhead lifting by OSHA or ASME due to their inferior
strength, there are effectively no substitutes for overhead lifting
chain.
VI. Anticompetitive Effects
19. In the United States, CMCO and Kito Crosby are the two largest
suppliers of electric chain hoists and two of the three largest
suppliers of overhead lifting chain. CMCO's proposed acquisition of
Kito Crosby would eliminate the competition between them and its future
benefits to customers.
20. The transaction is likely to substantially lessen competition
in the market for electric chain hoists in the United States. CMCO and
Kito Crosby are the two largest suppliers of electric chain hoists with
a combined market share of over 70 percent. The market for electric
chain hoists is already highly concentrated and, as evidenced by the
parties' combined share, would be significantly more concentrated after
the proposed acquisition.
21. CMCO and Kito Crosby compete directly against one another to
provide electric chain hoists to customers. CMCO and Kito Crosby offer
more product features and local customer support than other market
participants. Defendants have lowered prices and improved customer
service as a result of competition from the other.
22. The transaction is also likely to substantially lessen
competition in the market for overhead lifting chain in the United
States. CMCO and Kito Crosby are two of the three largest suppliers of
overhead lifting chain in the United States and have a combined market
share of more than 60 percent. The market for overhead lifting chain is
already highly concentrated and would become significantly more
concentrated after the proposed acquisition.
23. CMCO and Kito Crosby compete head-to-head to supply overhead
lifting chain to customers. This competition has resulted in lower
prices, investments in new production capabilities, and better terms of
sale.
24. After the acquisition of Kito Crosby, CMCO likely would have
the incentive and ability to profitably increases prices for and reduce
the quality of its electric chain hoists and overhead lifting chain.
The proposed acquisition, therefore, may substantially lessen
competition for the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain in the United States
in violation of Section 7 of the Clayton Act.
VII. Absence of Countervailing Factors
25. Entry or repositioning of new competitors into the markets for
the development, manufacture, distribution, and sale of electric chain
hoists or overhead lifting chain is unlikely to be sufficient or timely
enough to prevent the loss of competition that will result from CMCO
acquiring Kito Crosby.
26. Not only does entering each of the electric chain hoist or
overhead lifting chain markets require significant time and investment
to set up production facilities and test new products, brand reputation
is also very important to competing successfully for customers in the
lifting and rigging industries. Electric chain hoists and overhead
lifting chain must operate reliably every time to avoid exposing
workers to significant risk. Customers often rely on personal
experience and brand recognition as a proxy for quality in selecting a
supplier since it can be difficult for customers to evaluate the
quality of a particular electric chain hoist or overhead lifting chain.
27. Potential entrants into the production of electric chain hoists
and overhead lifting chain also struggle to compete with established
suppliers due to the scale advantages that larger suppliers benefit
from given their increased production volumes. The fact that new
entrants have higher average costs than incumbents deters entry into
the markets for the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain.
28. As a result of these high barriers, entry into the markets for
the development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain would not be timely, likely, or
sufficient to defeat the substantial lessening of competition that
would likely result from CMCO's acquisition of Kito Crosby.
VIII. Violations Alleged
29. CMCO's acquisition of Kito Crosby may substantially lessen
competition in the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain in violation of
Section 7 of the Clayton Act, 15 U.S.C. 18.
30. Unless enjoined, the proposed acquisition likely would have the
following anticompetitive effects relating to electric chain hoists and
overhead lifting chain, among others:
(a) actual and potential competition between CMCO and Kito Crosby
would be eliminated;
(c) competition likely would be substantially lessened; and
(d) prices would likely increase, service would likely decrease,
quality would likely be reduced, and innovation would likely slow.
IX. Request for Relief
31. The United States requests that this Court:
(a) adjudge and decree that CMCO's acquisition of Kito Crosby would
be unlawful and violate Section 7 of the Clayton Act, 15 U.S.C. 18;
(b) preliminarily and permanently enjoin and restrain Defendants
and all persons acting on their behalf from consummating the proposed
acquisition of Kito Crosby by CMCO, or from entering into or carrying
out any other contract, agreement, plan, or understanding, the effect
of which would be to combine CMCO and Kito Crosby;
(c) award the United States its costs for this action; and
(d) award the United States such other and further relief as the
Court deems just and proper.
Dated: January 29, 2026
Respectfully submitted,
For Plaintiff United States of America
ABIGAIL A. SLATER (D.C. Bar #90027189), Assistant Attorney General.
MARK HAMER (D.C. Bar #1048333), Deputy Assistant Attorney General.
GEORGE C. NIERLICH (D.C. Bar #1004528), Acting Director of Civil
Enforcement (Mergers).
SOYOUNG CHOE, Acting Chief, Defense, Industrials, and Aerospace
Section.
GABRIELLA NEIZMIK (D.C. Bar # 1044309) *
ANNA CROSS MIRANDA ISAACS Trial Attorneys
U.S. Department of Justice, Antitrust Division, Defense,
Industrials, and Aerospace Section, 450 Fifth Street NW, Suite 8700,
Washington, DC 20530, Tel.: 202-598-8774,
[[Page 4941]]
Fax: 202-514-9033, Email: <a href="/cdn-cgi/l/email-protection#6b0c0a0919020e07070a45050e02110602002b1e180f0401450c041d"><span class="__cf_email__" data-cfemail="2a4d4b4858434f46464b04444f43504743416a5f594e4540044d455c">[email protected]</span></a>.
* LEAD ATTORNEY TO BE NOTICED
United States District Court for the District of Columbia
United States of America, Plaintiff, v. Columbus McKinnon
Corporation, KKR North America Fund XI L.P., and Kito Crosby
Limited, Defendants.
No. 1:26-cv-00266-TJK Judge Timothy J. Kelly
Proposed Final Judgment
Whereas, Plaintiff, United States of America, filed its Complaint
on January 29, 2026;
And whereas, the United States and Defendants, Columbus McKinnon
Corporation, KKR North America Fund XI L.P., and Kito Crosby Limited,
have consented to entry of this Final Judgment without the taking of
testimony, 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 relating to any issue of fact or law;
And whereas, Defendants agree to make a divestiture to remedy the
loss of competition alleged in the Complaint;
And whereas, Defendants represent that the divestiture and other
relief required by this Final Judgment can and will be made and that
Defendants will not later raise a claim of hardship or difficulty as
grounds for asking the Court to modify any provision of this Final
Judgment;
Now therefore, it is ordered, adjudged, and decreed:
I. Jurisdiction
The 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 Defendants under Section 7 of the Clayton
Act (15 U.S.C. 18).
II. Definitions
As used in this Final Judgment:
A. ``CMCO'' means Defendant Columbus McKinnon Corporation, a New
York corporation with its headquarters in Charlotte, North Carolina,
its successors and assigns, and its subsidiaries, divisions, groups,
affiliates, partnerships, and joint ventures, and their directors,
officers, managers, agents, and employees.
B. ``KKR'' means Defendant KKR North America Fund XI L.P., a Cayman
Islands exempted limited partnership with its principal place of
business in New York, New York, its successors and assigns, and its
subsidiaries, divisions, groups, affiliates, partnerships, and joint
ventures, and their directors, officers, managers, agents, and
employees.
C. ``Kito Crosby'' means Defendant Kito Crosby Limited, a private
limited company registered in the United Kingdom with its headquarters
in Arlington, Texas, its successors and assigns, and its subsidiaries,
divisions, groups, affiliates, partnerships, and joint ventures, and
their directors, officers, managers, agents, and employees.
D. ``Pacific'' means Pacific Avenue Capital Partners, LLC, a
Delaware limited liability company with its headquarters in Manhattan
Beach, California, its successors and assigns, and its subsidiaries,
divisions, groups, affiliates, partnerships, and joint ventures, and
their directors, officers, managers, agents, and employees.
E. ``Acquirer'' means Pacific or another entity approved by the
United States in its sole discretion to which Defendants divest the
Divestiture Assets.
F. ``Divestiture Business'' means the business of the development,
manufacture, distribution, and sale of Power Chain Hoists and chains by
CMCO in the United States.
G. ``Divestiture Assets'' means all of Defendant CMCO's rights,
titles, and interests in and to all property and assets, tangible and
intangible, wherever located, relating to or used in connection with
the Divestiture Business, including:
1. the real property and facility located at 22364 Jeb Stuart
Highway, Damascus, Virginia (the ``Damascus Facility'');
2. the real property and facility located at 560 Rush Street,
Lexington, Tennessee (the ``Lexington Facility'');
3. the lease dated June 30, 2016 between Defendant CMCO and Pod #2
at Rock Lititz LP for Training Pod #2, located at Suite 40, 201 Rock
Lititz Blvd., Lititz, Pennsylvania;
4. the lease dated July 31, 2025 between Defendant CMCO and Kilo
Delta, LLC for 26478 Hillman Highway, Abingdon, Virginia;
5. the lease dated January 1, 2026 between Defendant CMCO and Ellen
Costello for 22798 Jeb Stuart Highway, Damascus, Virginia;
6. the Transitional Columbus McKinnon Trademark License;
7. all other real property, including fee simple interests, real
property leasehold interests and renewal rights thereto, improvements
to real property, and options to purchase any adjoining or other
property, together with all buildings, facilities, and other
structures;
8. all tangible personal property, including fixed assets,
machinery and manufacturing equipment, tools, vehicles, inventory,
materials, office equipment and furniture, computer hardware, and
supplies (including tangible personal property located at the Wadesboro
Facility);
9. all contracts, contractual rights, and customer relationships,
and all other agreements, commitments, and understandings, including
supply agreements, teaming agreements, joint development agreements,
and leases, and all outstanding offers or solicitations to enter into a
similar arrangement;
10. all licenses, permits, certifications, approvals, consents,
registrations, waivers, and authorizations, including those issued or
granted by any governmental organization, and all pending applications
or renewals;
11. all records and data, including (a) customer lists, accounts,
sales, and credit records, (b) production, repair, maintenance, and
performance records, (c) manuals and technical information Defendants
provide to their own employees, customers, suppliers, agents, or
licensees, (d) records and research data concerning historic and
current research and development activities, including designs of
experiments and the results of successful and unsuccessful designs and
experiments, and (e) drawings, blueprints, and designs;
12. all intellectual property owned, licensed, or sublicensed,
either as licensor or licensee, including (a) patents, patent
applications, and inventions and discoveries that may be patentable,
(b) registered and unregistered copyrights and copyright applications,
and (c) registered and unregistered trademarks, trade dress, service
marks, trade names, and trademark applications; and
13. all other intangible property, including (a) commercial names
and d/b/a names, (b) technical information, (c) computer software and
related documentation, know-how, trade secrets, design protocols,
specifications for materials, specifications for parts, specifications
for devices, safety procedures (e.g., for the handling of materials and
substances), quality assurance and control procedures, (d) design tools
and simulation capabilities, and (e) rights in internet websites and
internet domain names.
Provided, however, that the assets specified in Paragraphs II.G.1-
13 above do not include (1) the interests in the Wadesboro Facility; or
(2) any intellectual property associated with the brand names
``Columbus McKinnon,'' ``CMCO,'' or ``CM'' other than what is provided
in the Transitional Columbus McKinnon Trademark License.
[[Page 4942]]
H. ``Divestiture Date'' means the date on which the Divestiture
Assets are divested to Acquirer pursuant to this Final Judgment.
I. ``Electric Chain Hoists'' means motorized lifting devices,
powered by electricity, that lift, lower, and position heavy loads
using a chain.
J. ``Including'' means including, but not limited to.
K. ``Overhead Lifting Chain'' means high-strength, alloy steel
chain specifically engineered for lifting, suspending, or maneuvering
heavy loads.
L. ``Power Chain Hoists'' means motorized lifting devices,
irrespective of the source of power, that lift, lower, and position
heavy loads using a chain.
M. ``Relevant Personnel'' means all full-time, part-time, or
contract employees of CMCO, wherever located, whose job
responsibilities relate in any way to the Divestiture Assets, at any
time between February 10, 2025, and the Divestiture Date, including
employees of CMCO whose job responsibilities relate to the
international sale of Power Chain Hoists and chains manufactured in the
United States. The United States, in its sole discretion, will resolve
any disagreement relating to which employees are Relevant Personnel.
N. ``Transaction'' means the proposed acquisition of Kito Crosby by
CMCO.
O. ``Transitional Columbus McKinnon Trademark License'' means a
non-exclusive, non-transferrable, sublicensable, fully paid-up,
royalty-free, worldwide license to use the ``CM'' marks in connection
with the Divestiture Business for a period of eight years following the
Divestiture Date.
P. ``Wadesboro Facility'' means Defendant CMCO's facility located
at 2020 Country Club Road, Wadesboro, NC 28170.
III. Applicability
A. This Final Judgment applies to KKR, Kito Crosby, and CMCO, as
defined above, and all other persons in active concert or participation
with any Defendant who receive actual notice of this Final Judgment.
B. If, prior to complying with Section IV and Section V of this
Final Judgment, Defendants sell or otherwise dispose of all or
substantially all of their assets or of business units that include the
Divestiture Assets, Defendants must require any purchaser to be bound
by the provisions of this Final Judgment. Defendants need not obtain
such an agreement from Acquirer.
IV. Divestiture
A. Defendants are ordered and directed, within 45 calendar days
after the Court's entry of the Asset Preservation and Hold Separate
Stipulation and Order in this matter, to divest the Divestiture Assets
in a manner consistent with this Final Judgment to Pacific or another
Acquirer acceptable to the United States, in its sole discretion. The
United States, in its sole discretion, may agree to one or more
extensions of this time period not to exceed 90 calendar days in total
and will notify the Court of any extensions.
B. For all contracts, agreements, customer relationships, and
supplier relationships (or portions of such contracts, agreements,
customer relationships, and supplier relationships) included in the
Divestiture Assets, Defendant CMCO must assign or otherwise transfer
all contracts, agreements, customer relationships, and supplier
relationships to Acquirer within the deadlines set forth in Paragraph
IV.A.; provided, however, that for any contract or agreement that
requires the consent of another party to assign or otherwise transfer,
Defendant CMCO must use best efforts to accomplish the assignment or
transfer. Defendants must not interfere with any negotiations between
Acquirer and a contracting party.
C. Defendants must use best efforts to divest the Divestiture
Assets as expeditiously as possible. Defendants must take no action
that would jeopardize the completion of the divestiture ordered by the
Court, including any action to impede the permitting, operation, or
divestiture of the Divestiture Assets.
D. Unless the United States otherwise consents in writing,
divestiture pursuant to this Final Judgment must include the entire
Divestiture Assets and must be accomplished in such a way as to satisfy
the United States, in its sole discretion, that the Divestiture Assets
can and will be used by Acquirer as part of a viable, ongoing business
of the development, manufacture, distribution, and sale of Electric
Chain Hoists and Overhead Lifting Chain and that the divestiture to
Acquirer will remedy the competitive harm alleged in the Complaint.
E. The divestiture must be made to an Acquirer that, in the United
States' sole judgment, has the intent and capability, including the
necessary managerial, operational, technical, and financial capability,
to compete effectively in the development, manufacture, distribution,
and sale of Electric Chain Hoists and Overhead Lifting Chain.
F. The divestiture must be accomplished in a manner that satisfies
the United States, in its sole discretion, that none of the terms of
any agreement between Acquirer and Defendants give Defendants the
ability unreasonably to raise Acquirer's costs, to lower Acquirer's
efficiency, or otherwise interfere in the ability of Acquirer to
compete effectively in the development, manufacture, distribution, and
sale of Electric Chain Hoists and Overhead Lifting Chain.
G. In the event Defendants are attempting to divest the Divestiture
Assets to an Acquirer other than Pacific, Defendants promptly must make
known, by usual and customary means, the availability of the
Divestiture Assets. Defendants must inform any person making an inquiry
relating to a possible purchase of the Divestiture Assets that the
Divestiture Assets are being divested in accordance with this Final
Judgment and must provide that person with a copy of this Final
Judgment. Defendants must offer to furnish to all prospective
Acquirers, subject to customary confidentiality assurances, all
information and documents relating to the Divestiture Assets that are
customarily provided in a due diligence process; provided, however,
that Defendants need not provide information or documents subject to
the attorney-client privilege or work-product doctrine. Defendants must
make all information and documents available to the United States at
the same time that the information and documents are made available to
any other person.
H. Defendant CMCO must provide prospective Acquirers with (1)
access to make inspections of the Divestiture Assets; (2) access to all
environmental, zoning, and other permitting documents and information
relating to the Divestiture Assets; and (3) access to all financial,
operational, or other documents and information relating to the
Divestiture Assets that would customarily be provided as part of a due
diligence process. Defendant CMCO also must disclose all encumbrances
on any part of the Divestiture Assets, including on intangible
property.
I. Defendant CMCO must cooperate with and assist Acquirer in
identifying and, at the option of Acquirer, hiring all Relevant
Personnel, including:
1. Within 10 business days following the entry of the Asset
Preservation and Hold Separate Stipulation and Order in this matter,
Defendant CMCO must identify all Relevant Personnel to Acquirer and the
United States, including by providing organization charts covering all
Relevant Personnel.
[[Page 4943]]
2. Within 10 business days following receipt of a request by
Acquirer or the United States, Defendant CMCO must provide to Acquirer
and the United States additional information relating to Relevant
Personnel, including name, job title, reporting relationships, working
location, and responsibilities. Defendant CMCO must also provide to
Acquirer and the United States information relating to current and
accrued compensation and benefits of Relevant Personnel, including most
recent bonuses paid, aggregate annual compensation, current target or
guaranteed bonus, if any, any retention agreement or incentives, and
any other payments due, compensation or benefits accrued, or promises
made to the Relevant Personnel. If Defendant CMCO is barred by any
applicable law from providing any of this information, Defendant CMCO
must provide, within 10 business days following receipt of the request,
the requested information to the full extent permitted by law and also
must provide a written explanation of Defendant CMCO's inability to
provide the remaining information, including specifically identifying
the provisions of the applicable laws.
3. At the request of Acquirer, Defendant CMCO must promptly make
Relevant Personnel available for private interviews with Acquirer
during normal business hours at a mutually agreeable location.
4. Defendants must not interfere with any effort by Acquirer to
employ any Relevant Personnel. Interference includes offering to
increase the compensation or improve the benefits of Relevant Personnel
unless (a) the offer is part of a company-wide increase in compensation
or improvement in benefits that was announced prior to February 10,
2025 or (b) the offer is approved by the United States in its sole
discretion. Defendants' obligations under this Paragraph IV.I.4. will
expire 180 calendar days after the Divestiture Date.
5. For Relevant Personnel who elect employment with Acquirer within
180 calendar days of the Divestiture Date, Defendants must waive all
non-compete and non-disclosure agreements; vest and pay to the Relevant
Personnel (or to Acquirer for payment to the employee) on a prorated
basis any bonuses, incentives, other salary, benefits, or other
compensation fully or partially accrued at the time of the transfer of
the employee to Acquirer; vest any unvested pension and other equity
rights; and provide all other benefits that those Relevant Personnel
otherwise would have been provided had the Relevant Personnel continued
employment with Defendant CMCO, including any retention bonuses or
payments. Defendants may maintain reasonable restrictions on disclosure
by Relevant Personnel of Defendants' proprietary non-public information
that is unrelated to the Divestiture Assets and not otherwise required
to be disclosed by this Final Judgment.
J. For a period of 24 months from the Divestiture Date, Defendants
CMCO and Kito Crosby may not solicit to re-hire Relevant Personnel who
were hired by Acquirer within 180 days of the Divestiture Date unless
(a) an individual is terminated or laid off by Acquirer or (b) Acquirer
agrees in writing that Defendants may solicit to re-hire that
individual. Nothing in this Paragraph IV.J prohibits Defendants from
advertising employment openings using general solicitations or
advertisements and re-hiring Relevant Personnel who apply for an
employment opening through a general solicitation or advertisement.
K. Defendant CMCO must warrant to Acquirer that (1) the Divestiture
Assets will be operational and without material defect on the date of
their transfer to the Acquirer; (2) there are no material defects in
the environmental, zoning, or other permits relating to the operation
of the Divestiture Assets; and (3) Defendant CMCO has disclosed all
encumbrances on any part of the Divestiture Assets, including on
intangible property. Following the sale of the Divestiture Assets,
Defendants must not undertake, directly or indirectly, challenges to
the environmental, zoning, or other permits relating to the operation
of the Divestiture Assets.
L. Defendant CMCO must use best efforts to assist Acquirer to
obtain all necessary licenses, registrations, and permits to operate
the Divestiture Business. Until Acquirer obtains the necessary
licenses, registrations, and permits, Defendant CMCO must provide
Acquirer with the benefit of Defendant CMCO's licenses, registrations,
and permits to the full extent permissible by law.
M. At the option of Acquirer, and subject to approval by the United
States in its sole discretion, on or before the Divestiture Date,
Defendant CMCO must enter into a supply contract or contracts for
hooks, motors, drives, gears, hardware, and components related to the
Divestiture Assets sufficient to meet Acquirer's needs, as determined
by Acquirer, for a period of up to 24 months, on terms and conditions
reasonably related to market conditions for the supply of hooks,
motors, drives, gears, hardware, and components related to the
Divestiture Assets. At the option of the Acquirer, subject to approval
by the United States in its sole discretion, Defendant CMCO must enter
into one or more extensions of any such contracts for a total of up to
an additional 12 months, on terms and conditions reasonably related to
market conditions for the supply of hooks, motors, drives, gears,
hardware, and components related to the Divestiture Assets. Any
amendment to or modification of any provision of any such supply
contract or supply contract extension is subject to approval by the
United States, in its sole discretion. If Acquirer seeks an extension
of the term of any supply contract, Defendant CMCO must notify the
United States in writing at least 60 calendar days prior to the date
the supply contract expires. Acquirer may terminate a supply contract
(including an extension of a supply contract), or any portion of a
supply contract (including a portion of an extension of a supply
contract), without cost or penalty upon 30 calendar days' written
notice.
N. At the option of Acquirer, and subject to approval by the United
States in its sole discretion, on or before the Divestiture Date,
Defendant CMCO must enter into a contract to provide transition
services for back office, human resources, accounting, employee health
and safety, supply chain logistics, and information technology services
and support for a period of up to 12 months on terms and conditions
reasonably related to market conditions for the provision of the
transition services. At the option of the Acquirer, subject to approval
by the United States in its sole discretion, Defendant CMCO must enter
into one or more extensions of any such contracts for a total of up to
an additional 90 calendar days, on terms and conditions reasonably
related to market conditions for the provision of the transition
services. Any amendment to or modification of any transition services
contract or extension to a transition services contract is subject to
approval by the United States, in its sole discretion. If Acquirer
seeks an extension of the term of any contract for transition services,
Defendant CMCO must notify the United States in writing at least five
calendar days prior to the date the contract expires. Acquirer may
terminate a contract (including an extension) for transition services,
or any portion of a contract (including an extension) for transition
services, without cost or penalty at any time upon 30 calendar days'
written notice. The employees of Defendant CMCO tasked with providing
transition
[[Page 4944]]
services to Acquirer must not share any competitively sensitive
information of Acquirer with any other employee of Defendants.
O. At the option of Acquirer, subject to approval by the United
States in its sole discretion, on or before the Divestiture Date,
Defendant CMCO must enter into a contract or contracts for the
operation of the portion of the Divestiture Assets located at the
Wadesboro Facility, sufficient to meet Acquirer's needs, as determined
by Acquirer, for a period of up to 12 months, on terms and conditions
reasonably related to market conditions for such asset operation. At
the option of Acquirer, subject to approval by the United States in its
sole discretion, Defendant CMCO must enter into one or more extensions
of any such contracts for a total of up to an additional 12 months, on
terms and conditions reasonably related to market conditions for such
asset operation. Any amendment to or modification of any provision of
any such contract or extension must first be approved by the United
States, in its sole discretion. If Acquirer seeks an extension of the
term of any such contract, Defendant CMCO must notify the United States
in writing at least 30 days prior to the date the contract expires.
Acquirer may terminate such a contract (including an extension), or any
portion of such a contract (including an extension), without cost or
penalty upon 30 calendar days' written notice. The employees of
Defendant CMCO tasked with operation of the Divestiture Assets located
at the Wadesboro Facility must not share any competitively sensitive
information of Acquirer with any employee of Defendants other than
those tasked with providing services at the Wadesboro Facility.
P. If any term of an agreement between Defendants and Acquirer,
including an agreement to effectuate the divestiture required by this
Final Judgment, varies from a term of this Final Judgment, to the
extent that Defendants cannot fully comply with both, this Final
Judgment determines Defendants' obligations.
V. Appointment of Divestiture Trustee
A. If Defendants have not divested all of the Divestiture Assets
within the period specified in Paragraph IV.A., Defendants must
immediately notify the United States of that fact in writing. Upon
application of the United States, which Defendants may not oppose, the
Court will appoint a divestiture 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 divestiture trustee by the Court,
only the divestiture trustee will have the right to sell those
Divestiture Assets that the divestiture trustee has been appointed to
sell. The divestiture trustee will have the power and authority to
accomplish the divestiture to an Acquirer acceptable to the United
States, in its sole discretion, at a price and on terms obtainable
through reasonable effort by the divestiture trustee, subject to the
provisions of Sections IV, V, and VI of this Final Judgment, and will
have other powers as the Court deems appropriate. The divestiture
trustee must sell the Divestiture Assets as quickly as possible.
C. Defendants may not object to a sale by the divestiture trustee
on any ground other than malfeasance by the divestiture trustee.
Objections by Defendants must be conveyed in writing to the United
States and the divestiture trustee within 10 calendar days after the
divestiture trustee has provided the notice of proposed divestiture
required by Section VI.
D. The divestiture trustee will serve at the cost and expense of
Defendants pursuant to a written agreement, on terms and conditions,
including confidentiality requirements and conflict of interest
certifications, approved by the United States in its sole discretion.
E. The divestiture trustee may hire at the cost and expense of
Defendants any agents or consultants, including investment bankers,
attorneys, and accountants, that are reasonably necessary in the
divestiture trustee's judgment to assist with the divestiture trustee's
duties. These agents or consultants will be accountable solely to the
divestiture trustee and will serve on terms and conditions, including
confidentiality requirements and conflict-of-interest certifications,
approved by the United States in its sole discretion.
F. The compensation of the divestiture trustee and agents or
consultants hired by the divestiture trustee must be reasonable in
light of the value of the Divestiture Assets and based on a fee
arrangement that provides the divestiture trustee with incentives based
on the price and terms of the divestiture and the speed with which it
is accomplished. If the divestiture trustee and Defendants are unable
to reach agreement on the divestiture trustee's compensation or other
terms and conditions of engagement within 14 calendar days of the
appointment of the divestiture trustee by the Court, the United States,
in its sole discretion, may take appropriate action, including by
making a recommendation to the Court. Within three business days of
hiring an agent or consultant, the divestiture trustee must provide
written notice of the hiring and rate of compensation to Defendants and
the United States.
G. The divestiture trustee must account for all monies derived from
the sale of the Divestiture Assets by the divestiture trustee and all
costs and expenses incurred. Within 30 calendar days of the Divestiture
Date, the divestiture trustee must submit that accounting to the Court
for approval. After approval by the Court of the divestiture trustee's
accounting, including fees for unpaid services and those of agents or
consultants hired by the divestiture trustee, all remaining money must
be paid to Defendants, and the trust will then be terminated.
H. Defendants must use best efforts to assist the divestiture
trustee to accomplish the required divestiture. Subject to reasonable
protection for trade secrets, other confidential research, development,
or commercial information, or any applicable privileges, Defendants
must provide the divestiture trustee and agents or consultants retained
by the divestiture trustee with full and complete access to all
personnel, books, records, and facilities of the Divestiture Assets.
Defendants also must provide or develop financial and other information
relevant to the Divestiture Assets that the divestiture trustee may
reasonably request. Defendants must not take any action to interfere
with or to impede the divestiture trustee's accomplishment of the
divestiture.
I. The divestiture trustee must maintain complete records of all
efforts made to sell the Divestiture Assets, including by filing
monthly reports with the United States setting forth the divestiture
trustee's efforts to accomplish the divestiture ordered by this Final
Judgment. The reports must 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 must describe in detail each
contact.
J. If the divestiture trustee has not accomplished the divestiture
ordered by this Final Judgment within 180 calendar days of appointment,
the divestiture trustee must promptly provide the United States with a
report setting forth: (1) the divestiture trustee's efforts to
accomplish the required divestiture; (2) the reasons, in the
divestiture trustee's
[[Page 4945]]
judgment, why the required divestiture have not been accomplished; and
(3) the divestiture trustee's recommendations for completing the
divestiture. Following receipt of that report, the United States may
make additional recommendations to the Court. The Court thereafter may
enter such orders as it deems appropriate to carry out the purpose of
this Final Judgment, which may include extending the trust and the term
of the divestiture trustee's appointment by a period requested by the
United States.
K. The divestiture trustee will serve until divestiture of all
Divestiture Assets is completed or for a term otherwise ordered by the
Court.
L. If the United States determines that the divestiture trustee is
not acting diligently or in a reasonably cost-effective manner, the
United States may recommend that the Court appoint a substitute
divestiture trustee.
VI. Notice of Proposed Divestiture
A. Within two business days following execution of a definitive
agreement with an Acquirer other than Pacific to divest the Divestiture
Assets, Defendants or the divestiture trustee, whichever is then
responsible for effecting the divestiture, must notify the United
States of the proposed divestiture. If the divestiture trustee is
responsible for completing the divestiture, the divestiture trustee
also must notify Defendants. The notice must 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.
B. After receipt by the United States of the notice required by
Paragraph VI.A., the United States may make one or more requests to
Defendants or the divestiture trustee for additional information
concerning the proposed divestiture, the proposed Acquirer, and other
prospective Acquirers. Defendants and the divestiture trustee must
furnish any additional information requested within 15 calendar days of
the receipt of each request unless the United States provides written
agreement to a different period.
C. Within 45 calendar days after receipt of the notice required by
Paragraph VI.A. or within 20 calendar days after the United States has
been provided the additional information requested pursuant to
Paragraph VI.B., whichever is later, the United States will provide
written notice to Defendants and any divestiture trustee that states
whether the United States, in its sole discretion, objects to the
proposed Acquirer or any other aspect of the proposed divestiture.
Without written notice that the United States does not object, a
divestiture may not be consummated. 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 Paragraph V.C. of this Final Judgment. Upon objection by
Defendants pursuant to Paragraph V.C., a divestiture by the divestiture
trustee may not be consummated unless approved by the Court.
VII. Financing
Defendants may not finance all or any part of Acquirer's purchase
of all or part of the Divestiture Assets.
VIII. Asset Preservation and Hold Separate Obligations
Defendants must take all steps necessary to comply with the Asset
Preservation and Hold Separate Stipulation and Order entered by the
Court.
IX. Affidavits
A. Within 20 calendar days of entry of the Asset Preservation and
Hold Separate Stipulation and Order, and every 30 calendar days
thereafter until the divestiture required by this Final Judgment has
been completed, each Defendant must deliver to the United States an
affidavit, signed by Defendant CMCO's Chief Financial Officer and
General Counsel and Defendant Kito Crosby's Chief Financial Officer and
Chief Legal and Compliance Officer, describing in reasonable detail the
fact and manner of that Defendant's compliance with this Final
Judgment. The United States, in its sole discretion, may approve
different signatories for the affidavits.
B. In the event Defendants are attempting to divest the Divestiture
Assets to an Acquirer other than Pacific, each affidavit required by
Paragraph IX.A. must include: (1) the name, address, and telephone
number of each person who, during the preceding 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, an interest in the Divestiture Assets and describe in detail
each contact with such persons during that period; (2) a description of
the efforts Defendants have taken to solicit buyers for and complete
the sale of the Divestiture Assets and to provide required information
to prospective Acquirers; and (3) a description of any limitations
placed by Defendants on information provided to prospective Acquirers.
Objection by the United States to information provided by Defendants to
prospective Acquirers must be made within 14 calendar days of receipt
of the affidavit, except that the United States may object at any time
if the information set forth in the affidavit is not true or complete.
C. Defendants must keep all records of any efforts made to divest
the Divestiture Assets until one year after the Divestiture Date.
D. Within 20 calendar days of entry of the Asset Preservation and
Hold Separate Stipulation and Order, Defendants must deliver to the
United States an affidavit signed by Defendant CMCO's Chief Financial
Officer and General Counsel and Defendant Kito Crosby's Chief Financial
Officer and Chief Legal and Compliance Officer that describes in
reasonable detail all actions that Defendants have taken and all steps
that Defendants have implemented on an ongoing basis to comply with
Section VIII of this Final Judgment. The United States, in its sole
discretion, may approve different signatories for the affidavits.
E. If a Defendant makes any changes to actions and steps described
in affidavits provided pursuant to Paragraph IX.D., the Defendant must,
within 15 calendar days after any change is implemented, deliver to the
United States an affidavit describing those changes.
F. Defendants must keep all records of any efforts made to comply
with Section VIII until one year after the Divestiture Date.
X. Compliance Inspection
A. For the purposes of determining or securing compliance with this
Final Judgment or of related orders such as the Asset Preservation and
Hold Separate Stipulation and Order or of determining whether this
Final Judgment should be modified or vacated, upon the written request
of an authorized representative of the Assistant Attorney General for
the Antitrust Division and reasonable notice to Defendants, Defendants
must permit, from time to time and subject to legally recognized
privileges, authorized representatives, including agents retained by
the United States:
1. to have access during Defendants' business hours to inspect and
copy, or at the option of the United States, to require Defendants to
provide electronic copies of all books, ledgers, accounts, records,
data, and documents, wherever located, in the possession, custody, or
control of Defendants relating to any
[[Page 4946]]
matters contained in this Final Judgment; and
2. to interview, either informally or on the record, Defendants'
officers, employees, or agents, wherever located, who may have their
individual counsel present, relating to any matters contained in this
Final Judgment. The interviews must 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 for the Antitrust Division, Defendants must
submit written reports or respond to written interrogatories, under
oath if requested, relating to any matters contained in this Final
Judgment.
XI. No Reacquisition
Defendants may not reacquire any part of or any interest in the
Divestiture Assets during the term of this Final Judgment without prior
written authorization of the United States.
XII. Public Disclosure
A. No information or documents obtained pursuant to any provision
in this Final Judgment may be divulged by the United States to any
person other than an authorized representative of the executive branch
of the United States, except in the course of legal proceedings to
which the United States is a party, including grand-jury proceedings,
for the purpose of evaluating a proposed Acquirer or securing
compliance with this Final Judgment, or as otherwise required by law.
B. In the event of a request by a third party, pursuant to the
Freedom of Information Act, 5 U.S.C. 552, for disclosure of information
obtained pursuant to any provision of this Final Judgment, the United
States will act in accordance with that statute and the Department of
Justice regulations at 28 CFR part 16, including the provision on
confidential commercial information at 28 CFR 16.7. Defendants
submitting information to the Antitrust Division should designate the
confidential commercial information portions of all applicable
documents and information under 28 CFR 16.7. Designations of
confidentiality expire 10 years after submission, ``unless the
submitter requests and provides justification for a longer designation
period.'' See 28 CFR 16.7(b).
C. If at the time that Defendants furnish information or documents
to the United States pursuant to any provision of this Final Judgment,
Defendants represent and identify in writing information or documents
for 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,'' the United
States must give Defendants 10 calendar days' notice before divulging
the material in any legal proceeding (other than a grand jury
proceeding).
XIII. Retention of Jurisdiction
The Court retains jurisdiction to enable any party to this Final
Judgment to apply to the 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. Enforcement of Final Judgment
A. If at any time during the five-year period following entry of
this Final Judgment, the United States determines in its sole
discretion that the Final Judgment has failed to fully redress the
violations alleged in the Complaint, then the United States may re-open
this proceeding to seek additional relief, including divestiture of
additional assets. Such additional relief may be ordered by this Court
upon a finding by a preponderance of the evidence that there is a
reasonable probability that the proposed Final Judgment did not fully
redress the violations alleged in the Complaint.
B. The United States retains and reserves all rights to enforce the
provisions of this Final Judgment, including the right to seek an order
of contempt from the Court. In a civil contempt action, a motion to
show cause, or a similar action brought by the United States relating
to an alleged violation of this Final Judgment, the United States may
establish a violation of this Final Judgment and the appropriateness of
a remedy therefor by a preponderance of the evidence, and Defendants
waive any argument that a different standard of proof should apply.
C. This Final Judgment should be interpreted to give full effect to
the procompetitive purposes of the antitrust laws and to restore the
competition the United States alleges was harmed by the challenged
conduct. Defendants may be held in contempt of, and the Court may
enforce, any provision of this Final Judgment that, as interpreted by
the Court in light of these procompetitive principles and applying
ordinary tools of interpretation, is stated specifically and in
reasonable detail, whether or not it is clear and unambiguous on its
face. In any such interpretation, the terms of this Final Judgment
should not be construed against either party as the drafter.
D. In an enforcement proceeding in which the Court finds that
Defendants have violated this Final Judgment, the United States may
apply to the Court for an extension of this Final Judgment, together
with other relief that may be appropriate. In connection with a
successful effort by the United States to enforce this Final Judgment
against a Defendant, whether litigated or resolved before litigation,
that Defendant must reimburse the United States for the fees and
expenses of its attorneys, as well as all other costs including
experts' fees, incurred in connection with that effort to enforce this
Final Judgment, including during the investigation of the potential
violation.
E. For a period of four years following the expiration of this
Final Judgment, if the United States has evidence that a Defendant
violated this Final Judgment before it expired, the United States may
file an action against that Defendant in this Court requesting that the
Court order: (1) Defendant to comply with the terms of this Final
Judgment for an additional term of at least four years following the
filing of the enforcement action; (2) all appropriate contempt
remedies; (3) additional relief needed to ensure the Defendant complies
with the terms of this Final Judgment; and (4) fees or expenses as
called for by this Section XIV.
XV. Expiration of Final Judgment
Unless the Court grants an extension, this Final Judgment will
expire 10 years from the date of its entry, except that after five
years from the date of its entry, this Final Judgment may be terminated
upon notice by the United States to the Court and Defendants that the
divestiture has been completed and continuation of this Final Judgment
is no longer necessary or in the public interest.
XVI. 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 by making available to the
public copies of this Final Judgment and the Competitive Impact
Statement, public comments thereon, and any response to comments by the
United States. Based upon the record before the Court, which includes
the Competitive Impact Statement and, if applicable, any comments and
response to comments filed with the
[[Page 4947]]
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. 16]
United States District Judge
United States District Court for The District of Columbia
United States of America, Plaintiff, v. Columbus McKinnon
Corporation, KKR North America Fund XI L.P., and Kito Crosby
Limited, Defendants.
No. 1:26-cv-00266-TJK
Judge Timothy J. Kelly
I. Competitive Impact Statement
In accordance with the Antitrust Procedures and Penalties Act, 15
U.S.C. 16(b)-(h) (the ``APPA'' or ``Tunney Act''), the United States of
America files this Competitive Impact Statement related to the proposed
Final Judgment filed in this civil antitrust proceeding.
I. Nature and Purpose of the Proceeding
On February 10, 2025, Columbus McKinnon Corporation (``CMCO'')
agreed to acquire all of the outstanding voting securities of Kito
Crosby Limited (``Kito Crosby'') for approximately $2.7 billion. The
United States filed a civil antitrust Complaint on January 29, 2026,
seeking to enjoin the proposed acquisition. The Complaint alleges that
the likely effect of this acquisition would be to substantially lessen
competition for electric chain hoists and overhead lifting chain in the
United States in violation of Section 7 of the Clayton Act, 15
U.S.C.Sec. 18.
At the same time the Complaint was filed, the United States filed a
proposed Final Judgment and an Asset Preservation and Hold Separate
Stipulation and Order (``Stipulation and Order''), which are designed
to remedy the loss of competition alleged in the Complaint.
Under the proposed Final Judgment, which is explained more fully
below, Defendant CMCO is required to divest its power chain hoist and
chains businesses in the United States.
Under the terms of the Stipulation and Order, Defendants must take
certain steps to operate, preserve, and maintain the full economic
viability, marketability, and competitiveness of the assets that must
be divested. In addition, management, sales, and operations of the
assets that must be divested must be held entirely separate, distinct
and apart from Defendants' other operations. The purpose of these terms
in the Stipulation and Order is to ensure that competition is
maintained during the pendency of the required divestiture.
The United States and Defendants have stipulated that the proposed
Final Judgment may be entered after compliance with the APPA. Entry of
the proposed Final Judgment will terminate this action, except that the
Court will retain jurisdiction to construe, modify, or enforce the
provisions of the proposed Final Judgment and to punish violations
thereof.
II. Description of Events Giving Rise to the Alleged Violation
A. The Defendants and the Proposed Transaction
CMCO is incorporated in New York and headquartered in Charlotte,
North Carolina. CMCO produces a wide range of material handling
equipment and is a market leader in the United States for hoists,
material handling digital power control systems, and precision
conveyers. The company has a strong market position in certain chains,
forged fittings, and linear actuator products. In 2024, CMCO had
revenues of approximately $1 billion.
Kito Crosby Limited is a private limited company registered in the
United Kingdom and headquartered in Arlington, Texas. Kito Crosby is a
global leader in the lifting and securement hardware industry with key
products including hoists, cranes, and lifting hardware. In 2024, Kito
Crosby had revenues of approximately $1.1 billion. Kito Crosby is owned
by KKR North America Fund XI L.P., a Cayman Islands exempted limited
partnership with its principal place of business in New York, New York.
Pursuant to a Stock Purchase Agreement dated February 10, 2025,
CMCO agreed to acquire all of the outstanding voting securities of Kito
Crosby for approximately $2.7 billion.
B. The Competitive Effects of the Transaction
The Complaint alleges that the transaction will result in
anticompetitive effects in the markets for the development,
manufacture, distribution, and sale of electric chain hoists and
overhead lifting chain in the United States.
1. Electric Chain Hoists
Electric chain hoists use a chain driven by an electric motor to
lift, lower, and position heavy materials. Electric chain hoists are
designed to be durable and can be used independently or integrated into
a small overhead crane. Industries across the economy--including
automotive, aerospace, energy, construction, and logistics--rely on
electric chain hoists daily to increase efficiency and reduce strain on
operators.
Electric chain hoists vary in capacity, voltages, chain length, and
speed. Electric chain hoists are ideal for lifting lighter loads
(generally less than three tons) and are easy for operators to use.
Although electric chain hoists vary in price depending on their
features, the majority of electric chain hoists sold in the United
States are priced from approximately $2,000 to $6,000.
While there are other types of hoists that are designed to perform
the same basic lifting, lowering, and positioning functions as electric
chain hoists, none of the alternatives offer the same value proposition
as electric chain hoists, and therefore are not close substitutes.
These other types of hoists are intended for different applications and
offer different benefits and drawbacks depending on the environment in
which it will be used, how much weight will be lifted, and lift
frequency. Accordingly, these other types of hoists are not effective
substitutes for electric chain hoists.
2. Overhead Lifting Chain
Chains vary greatly in strength, durability, and reliability
depending on how they are manufactured, the metals they are made from,
and their size. To ensure safe and proper usage, the American Society
of Testing & Materials (``ASTM'') recommends certain specifications for
chain used in different applications. The specifications for chain
recommended for use in overhead lifting are defined by ASTM as ``Grade
80'' and ``Grade 100.'' Overhead lifting chain is exclusively made from
forged alloy steel while lower grade chain is made from carbon steel or
stainless steel.
Chain manufacturers market chain as Grade 80 or Grade 100 and
emboss the links that make up the chain with the grade for
identification purposes. Chains that meet or exceed these
specifications are collectively referred to as ``overhead lifting
chain.'' Since lower grades of chain are not recommended for overhead
lifting by OSHA or ASME due to their inferior strength, there are
effectively no substitutes for overhead lifting chain.
3. Competitive Effects
The transaction is likely to substantially lessen competition in
the markets for the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain in the United States.
CMCO and Kito Crosby are the two largest suppliers of electric chain
hoists in the United States with a combined market share of over 70
percent. The market for
[[Page 4948]]
electric chain hoists is already highly concentrated and, as evidenced
by the parties' combined share, would be significantly more
concentrated after the proposed acquisition. CMCO and Kito Crosby
compete directly against one another to provide electric chain hoists
to customers. CMCO and Kito Crosby offer more product features and
local customer support than other market participants. Defendants have
lowered prices and improved customer service as a result of competition
from the other.
CMCO and Kito Crosby are also two of the three largest suppliers of
overhead lifting chain in the United States and have a combined market
share of more than 60 percent. The market for overhead lifting chain is
already highly concentrated and would become significantly more
concentrated after the proposed acquisition. CMCO and Kito Crosby
compete head-to-head to supply overhead lifting chain to customers.
This competition has resulted in lower prices, investments in new
production capabilities, and better terms of sale.
After the acquisition of Kito Crosby, CMCO likely would have the
incentive and ability to profitably increase prices for and reduce the
quality of its electric chain hoists and overhead lifting chain. The
proposed acquisition, therefore, likely would substantially lessen
competition for the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain in the United States
in violation of Section 7 of the Clayton Act.
4. Difficulty of Entry
Entry or repositioning of new competitors into the market for the
development, manufacture, distribution, and sale of electric chain
hoists or overhead lifting chain is unlikely to be sufficient or timely
enough to prevent the loss of competition that will result from CMCO
acquiring Kito Crosby.
Not only does entering each of the electric chain hoist or overhead
lifting chain markets require significant time and investment to set up
production facilities and test new products, brand reputation is also
very important to competing successfully for customers in the lifting
and rigging industries. Electric chain hoists and overhead lifting
chain must operate reliably every time to avoid exposing workers to
significant risk. Customers often rely on personal experience and brand
recognition as a proxy for quality in selecting a supplier since it can
be difficult for customers to evaluate the quality of a particular
electric chain hoist or overhead lifting chain.
Potential entrants into the production of electric chain hoists and
overhead lifting chain also struggle to compete with established
suppliers due to the scale advantages that larger suppliers benefit
from given their increased production volumes. The fact that new
entrants have higher average costs than incumbents deters entry into
the markets for the development, manufacture, distribution, and sale of
electric chain hoists and overhead lifting chain.
As a result of these high barriers, entry into the markets for the
development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain would not be timely, likely, or
sufficient to defeat the substantial lessening of competition that
would likely result from CMCO's acquisition of Kito Crosby.
III. Explanation of the Proposed Final Judgment
The relief required by the proposed Final Judgment will remedy the
loss of competition alleged in the Complaint by establishing an
independent and economically viable competitor in the markets for the
development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain. Paragraph IV.A of the proposed Final
Judgment requires Defendants, within 45 days after the entry of the
Stipulation and Order by the Court, to divest Defendant CMCO's Power
Chain Hoist and chains businesses in the United States to Pacific
Avenue Capital Partners or an alternative acquirer acceptable to the
United States, in its sole discretion. The assets must be divested in
such a way as to satisfy the United States, in its sole discretion,
that the assets can and will be operated by the acquirer as a viable,
ongoing business that can compete effectively in the markets for the
development, manufacture, distribution, and sale of electric chain
hoists and overhead lifting chain. Defendants must take all reasonable
steps necessary to accomplish the divestiture quickly and must
cooperate with the acquirer.
Defendants are required to divest the Divestiture Assets, which
consist of all Defendant CMCO's rights, titles, and interests in and to
all property and assets related to the Divestiture Business. The
Divestiture Business, defined in Paragraph II.F, includes the business
of the development, manufacture, distribution, and sale of Power Chain
Hoists and chains by CMCO in the United States. As defined in Paragraph
II.L, Power Chain Hoists includes all motorized lifting devices,
irrespective of the source of power, that lift, lower, and position
heavy loads using a chain.
Paragraph II.G of the proposed Final Judgment identifies categories
of Divestiture Assets, including (1) real property interests at
specified locations used in the Divestiture Business in Damascus,
Virginia; Lexington, Tennessee; Lititz, Pennsylvania; and Abingdon,
Virginia; (2) a transitional Columbus McKinnon trademark license; (3)
all other real property related to the Divestiture Business; (4) all
personal property, including fixed assets, machinery and manufacturing
equipment, tools, vehicles, inventory, materials, office equipment and
furniture, computer hardware, and supplies (including tangible personal
property located CMCO's manufacturing facility in Wadesboro, North
Carolina); (5) all contracts, contractual rights, and customer
relationships, and all other agreements, commitments, and
understandings, including supply agreements; (6) all licenses, permits,
certifications, approvals, consents, registrations, waivers, and
authorizations; (7) all records and data; (8) all intellectual property
owned, licensed, or sublicensed, either as licensor or licensee; and
(9) all other intangible property. These Divestiture Assets are broadly
defined to ensure a complete divestiture of all assets needed for the
Divested Businesses. Any exceptions to the divestiture obligations are
specified in the proposed Final Judgment.
The Divestiture Assets do not include certain specified assets, as
defined in Paragraph II.G, including (1) the interests in CMCO's
manufacturing facility in Wadesboro, North Carolina; or (2) any
intellectual property associated with the brand names ``Columbus
McKinnon,'' ``CMCO,'' or ``CM'' other than what is provided in the
transitional Columbus McKinnon trademark license, as defined in
Paragraph II.O.
The proposed Final Judgment contains provisions intended to
facilitate the acquirer's efforts to hire certain employees.
Specifically, Paragraph IV.I of the proposed Final Judgment requires
Defendant CMCO to identify to the acquirer and the United States all
Relevant Personnel, including by providing organization charts and
information relating to these employees and to make them available for
interviews. It also provides that Defendants must not interfere with
any negotiations by the acquirer to hire these employees. In addition,
for employees who elect employment with
[[Page 4949]]
the acquirer, Defendants must waive all non-compete and non-disclosure
agreements, vest all unvested pension and other equity rights, provide
any pay pro rata, provide all compensation and benefits that those
employees have fully or partially accrued, and provide all other
benefits that the employees would generally be provided had those
employees continued employment with Defendant CMCO, including but not
limited to any retention bonuses or payments. Paragraph IV.J provides
that Defendants CMCO and Kito Crosby may not solicit to re-hire any of
those employees who were hired by the acquirer, unless an employee is
terminated or laid off by the acquirer or the acquirer agrees in
writing that Defendants may solicit to hire that individual. The non-
solicitation period runs for 24 months from the date of the
divestiture.
Paragraph IV.B of the proposed Final Judgment will facilitate the
transfer to the acquirer of customers, suppliers, and other contractual
relationships that are included within the Divestiture Assets.
Defendant CMCO must transfer all contracts, agreements, and
relationships to the acquirer and must make best efforts to assign or
otherwise transfer contracts or agreements that require the consent of
another party to assign or otherwise transfer.
Paragraph IV.M of the proposed Final Judgment requires Defendant
CMCO, at the acquirer's option, to enter into a supply contract for
hooks, motors, drives, gears, hardware, and components related to the
Divestiture Assets sufficient to meet acquirer's needs for a period of
up to 24 months. The acquirer may terminate the supply contract, or any
portion of it, without cost or penalty at any time upon 30 calendar
days' notice. Upon the acquirer's request, the United States, in its
sole discretion, may approve one or more extensions of the supply
contract for up to an additional 12 months. Any amendment to or
modification of any provisions of a supply contract is subject to
approval by the United States, in its sole discretion. This provision
will help to ensure that the acquirer will not face disruption to its
supply of hooks, motors, drives, gears, hardware, and components
related to the Divestiture Assets during an important transitional
period.
The proposed Final Judgment requires Defendant CMCO to provide
certain transition services to maintain the viability and
competitiveness of the Divestiture Assets during the transition to the
acquirer. Paragraph IV.N of the proposed Final Judgment requires
Defendant CMCO, at the option of the acquirer, to enter into a
transition services agreement for back office, human resources,
accounting, employee health and safety, supply chain logistics, and
information technology services and support for a period of up to 12
months. The acquirer may terminate the transition services agreement,
or any portion of it, without cost or penalty at any time upon 30
calendar days' notice. The paragraph further provides that the United
States, in its sole discretion, may approve one or more extensions of
the transition services agreement for a total of up to an additional 90
calendar days. Any amendment to or modification of any transition
services contract is subject to approval by the United States, in its
sole discretion. Paragraph IV.N also provides that employees of
Defendant CMCO tasked with supporting this agreement must not share any
competitively sensitive information of the acquirer with any other
employee of Defendants.
Paragraph IV.O of the proposed Final Judgment provides that
Defendant CMCO must enter into a contract or contracts for the
operation of the portion of the Divestiture Assets located at CMCO's
facility in Wadesboro, North Carolina for a period of up to 12 months.
At the option of the acquirer, the United States, in its sole
discretion, may approve one or more extensions of the contract for up
to an additional 12 months. Any amendment to or modification of any
such contract or extension is subject to approval by the United States,
in its sole discretion. The acquirer may terminate the contract, or any
portion of it, without cost or penalty at any time upon 30 calendar
days' notice. Paragraph IV.O also provides that employees of Defendant
CMCO tasked with supporting this agreement must not share any
competitively sensitive information of the acquirer with any employee
of Defendants other than those also tasked with providing services
supporting this agreement.
If Defendants do not accomplish the divestiture within the period
prescribed in Paragraph IV.A of the proposed Final Judgment, Section V
of the proposed Final Judgment provides that the Court will appoint a
divestiture trustee selected by the United States to effect the
divestiture. If a divestiture trustee is appointed, the proposed Final
Judgment provides that Defendants must pay all costs and expenses of
the trustee. The divestiture trustee's commission must be structured so
as to provide an incentive for the trustee based on the price obtained
and the speed with which the divestiture is accomplished. After the
divestiture trustee's appointment becomes effective, the trustee must
provide monthly reports to the United States setting forth his or her
efforts to accomplish the divestiture. If the divestiture has not been
accomplished within 180 calendar days of the divestiture trustee's
appointment, the United States may make recommendations to the Court,
which will enter such orders as appropriate, in order to carry out the
purpose of the Final Judgment, including by extending the trust or the
term of the divestiture trustee's appointment.
The proposed Final Judgment also contains provisions designed to
promote compliance with and make enforcement of the Final Judgment as
effective as possible. Paragraph XIV.A of the proposed Final Judgment
provides that, if at any time during the five-year period following
entry of the Final Judgment, the United States determines at its sole
discretion that the Final Judgment has failed to fully redress the
violations alleged in the Complaint, then the United States may re-open
the proceeding to seek additional relief, including divestiture of
additional assets.
Paragraph XIV.B provides that the United States retains and
reserves all rights to enforce the Final Judgment, including the right
to seek an order of contempt from the Court. Under the terms of
Paragraph XIV.B, Defendants have agreed that in any civil contempt
action, any motion to show cause, or any similar action brought by the
United States regarding an alleged violation of the Final Judgment, the
United States may establish the violation and the appropriateness of
any remedy by a preponderance of the evidence and that Defendants have
waived any argument that a different standard of proof should apply.
This provision aligns the standard for compliance with the Final
Judgment with the standard of proof that applies to the underlying
offense that the Final Judgment addresses.
Paragraph XIV.C provides additional clarification regarding the
interpretation of the provisions of the proposed Final Judgment. The
proposed Final Judgment is intended to restore the competition the
United States alleged in the Complaint. Defendants agree that they will
abide by the proposed Final Judgment and that they may be held in
contempt of the Court for failing to comply with any provision of the
proposed Final Judgment that is stated specifically and in reasonable
detail, as interpreted in light of this procompetitive purpose.
Paragraph XIV.D provides that if the Court finds in an enforcement
proceeding that a Defendant has violated the Final Judgment, the United
[[Page 4950]]
States may apply to the Court for an extension of the Final Judgment,
together with such other relief as may be appropriate. In addition, to
compensate American taxpayers for any costs associated with
investigating and enforcing violations of the Final Judgment, Paragraph
XIV.D provides that, in any successful effort by the United States to
enforce the Final Judgment against a Defendant, whether litigated or
resolved before litigation, the Defendant must reimburse the United
States for attorneys' fees, experts' fees, and other costs incurred in
connection with that effort to enforce this Final Judgment, including
the investigation of the potential violation.
Paragraph XIV.E states that the United States may file an action
against a Defendant for violating the Final Judgment for up to four
years after the Final Judgment has expired or been terminated. This
provision is meant to address circumstances such as when evidence that
a violation of the Final Judgment occurred during the term of the Final
Judgment is not discovered until after the Final Judgment has expired
or been terminated or when there is not sufficient time for the United
States to complete an investigation of an alleged violation until after
the Final Judgment has expired or been terminated. This provision,
therefore, makes clear that, for four years after the Final Judgment
has expired or been terminated, the United States may still challenge a
violation that occurred during the term of the Final Judgment.
Finally, Section XV of the proposed Final Judgment provides that
the Final Judgment will expire ten years from the date of its entry,
except that after five years from the date of its entry, the Final
Judgment may be terminated upon notice by the United States to the
Court and Defendants that the divestiture has been completed and
continuation of the Final Judgment is no longer necessary or in the
public interest.
IV. Remedies Available to Potential Private Plaintiffs
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 neither impairs
nor assists 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 Defendants.
V. Procedures Available for Modification of the Proposed Final Judgment
The United States and Defendants have stipulated that the proposed
Final Judgment may be entered by the Court after compliance with the
provisions of the APPA, provided that the United States has not
withdrawn its consent. The APPA conditions entry upon the Court's
determination that the proposed Final Judgment is in the public
interest.
The APPA provides 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, or within 60 days of the first date of
publication in a newspaper of the summary of this Competitive Impact
Statement, whichever is later. All comments received during this period
will be considered by the U.S. Department of Justice, which remains
free to withdraw its consent to the proposed Final Judgment at any time
before the Court's entry of the Final Judgment. The comments and the
response of the United States will be filed with the Court. In
addition, the comments and the United States' responses will be
published in the Federal Register unless the Court agrees that the
United States instead may publish them on the U.S. Department of
Justice, Antitrust Division's internet website.
Written comments should be submitted in English to: Soyoung Choe
Acting Chief, Defense, Industrials, and Aerospace Section, Antitrust
Division, United States Department of Justice, 450 Fifth St. NW, Suite
8700, Washington, DC 20530, <a href="/cdn-cgi/l/email-protection#642530364a341106080d0749270b0909010a10174930110a0a011d49250710492926241117000b0e4a030b12"><span class="__cf_email__" data-cfemail="b6f7e2e498e6c3d4dadfd59bf5d9dbdbd3d8c2c59be2c3d8d8d3cf9bf7d5c29bfbf4f6c3c5d2d9dc98d1d9c0">[email protected]</span></a>.
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
As an alternative to the proposed Final Judgment, the United States
considered a full trial on the merits against Defendants. The United
States could have continued the litigation and sought preliminary and
permanent injunctions against Columbus McKinnon's acquisition of Kito
Crosby. The United States is satisfied, however, that the relief
required by the proposed Final Judgment will remedy the anticompetitive
effects alleged in the Complaint, preserving competition for electric
chain hoists and overhead lifting chain in the United States. Thus, the
proposed Final Judgment achieves all or substantially all of the relief
the United States would have obtained through litigation but avoids the
time, expense, and uncertainty of a full trial on the merits.
VII. Standard of Review Under the APPA for the Proposed Final Judgment
Under the Clayton Act and APPA, proposed Final Judgments, or
``consent decrees,'' in antitrust cases brought by the United States
are subject to a 60-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); United States v. U.S. Airways Grp.,
Inc., 38 F. Supp. 3d 69, 75 (D.D.C. 2014) (explaining that the
``court's inquiry is limited'' in Tunney Act settlements); United
States v. InBev N.V./S.A., No. 08-1965 (JR), 2009 U.S. Dist. LEXIS
84787, at * 3 (D.D.C. Aug. 11, 2009) (noting that a court's review of a
proposed Final Judgment is limited and only inquires ``into whether the
government's determination that the proposed remedies will cure the
antitrust violations alleged in the
[[Page 4951]]
complaint was reasonable, and whether the mechanisms to enforce the
final judgment are clear and manageable'').
As the U.S. 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 in
the government's Complaint, whether the proposed Final Judgment is
sufficiently clear, whether its enforcement mechanisms are sufficient,
and whether it may positively harm third parties. See Microsoft, 56
F.3d at 1458-62. With respect to the adequacy of the relief secured by
the proposed Final Judgment, a court may not ``make de novo
determination of facts and issues.'' United States v. W. Elec. Co., 993
F.2d 1572, 1577 (D.C. Cir. 1993) (quotation marks omitted); see also
Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 F.
Supp. 2d 37, 40 (D.D.C. 2001); United States v. Enova Corp., 107 F.
Supp. 2d 10, 16 (D.D.C. 2000); InBev, 2009 U.S. Dist. LEXIS 84787, at *
3. Instead, ``[t]he balancing of competing social and political
interests affected by a proposed antitrust decree must be left, in the
first instance, to the discretion of the Attorney General.'' W. Elec.
Co., 993 F.2d at 1577 (quotation marks omitted). ``The court should
also bear in mind the flexibility of the public interest inquiry: the
court's function is not to determine whether the resulting array of
rights and liabilities is the one that will best serve society, but
only to confirm that the resulting settlement is within the reaches of
the public interest.'' Microsoft, 56 F.3d at 1460 (quotation marks
omitted); see also United States v. Deutsche Telekom AG, No. 19-2232
(TJK), 2020 WL 1873555, at * 7 (D.D.C. Apr. 14, 2020). More demanding
requirements would ``have enormous practical consequences for the
government's ability to negotiate future settlements,'' contrary to
congressional intent. Microsoft, 56 F.3d at 1456. ``The Tunney Act was
not intended to create a disincentive to the use of the consent
decree.'' Id.
The United States' predictions about the efficacy of the remedy are
to be afforded deference by the Court. See, e.g., Microsoft, 56 F.3d at
1461 (recognizing courts should give ``due respect to the Justice
Department's . . . view of the nature of its case''); United States v.
Iron Mountain, Inc., 217 F. Supp. 3d 146, 152-53 (D.D.C. 2016) (``In
evaluating objections to settlement agreements under the Tunney Act, a
court must be mindful that [t]he government need not prove that the
settlements will perfectly remedy the alleged antitrust harms[;] it
need only provide a factual basis for concluding that the settlements
are reasonably adequate remedies for the alleged harms.'' (internal
citations omitted)); United States v. Republic Servs., Inc., 723 F.
Supp. 2d 157, 160 (D.D.C. 2010) (noting ``the deferential review to
which the government's proposed remedy is accorded''); United States v.
Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (``A
district court must accord due respect to the government's prediction
as to the effect of proposed remedies, its perception of the market
structure, and its view of the nature of the case.''). The ultimate
question is whether ``the remedies [obtained by the Final Judgment are]
so inconsonant with the allegations charged as to fall outside of the
`reaches of the public interest.''' Microsoft, 56 F.3d at 1461 (quoting
W. Elec. Co., 900 F.2d at 309).
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; see also U.S. Airways,
38 F. Supp. 3d at 75 (noting that the court must simply determine
whether there is a factual foundation for the government's decisions
such that its conclusions regarding the proposed settlements are
reasonable); InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (``[T]he
`public interest' is not to be measured by comparing the violations
alleged in the complaint against those the court believes could have,
or even should have, been alleged''). 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. Microsoft, 56
F.3d at 1459-60.
In its 2004 amendments to the APPA, Congress made clear its intent
to preserve the practical benefits of using judgments proposed by the
United States in antitrust enforcement, Public L 108-237 Sec. 221, and
added 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); see also U.S. Airways, 38 F. Supp. 3d at 76
(indicating that a court is not required to hold an evidentiary hearing
or to permit intervenors as part of its review under the Tunney Act).
This language explicitly wrote into the statute what Congress intended
when it first 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 Sen.
Tunney). ``A court can make its public interest determination based on
the competitive impact statement and response to public comments
alone.'' U.S. Airways, 38 F. Supp. 3d at 76 (citing Enova Corp., 107 F.
Supp. 2d at 17).
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: January 29, 2026.
Respectfully submitted,
FOR PLAINTIFF
UNITED STATES OF AMERICA:
Gabriella Neizmik (DC Bar # 1044309)
ANNA CROSS
Miranda Isaacs, U.S. Department of Justice, Antitrust Division,
Defense, Industrials, and Aerospace, Section, 450 Fifth Street NW,
Suite 8700, Washington, DC 20530, Tel.: 202-598-8774, Email:
<a href="/cdn-cgi/l/email-protection#3a5d5b5848535f56565b14545f53405753517a4f495e5550145d554c"><span class="__cf_email__" data-cfemail="8deaecefffe4e8e1e1eca3e3e8e4f7e0e4e6cdf8fee9e2e7a3eae2fb">[email protected]</span></a>.
[FR Doc. 2026-02185 Filed 2-2-26; 8:45 am]
BILLING CODE 4410-11-P
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</html>Indexed from Federal Register on February 3, 2026.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.