The consent decree was entered by the court on August 17, 1998.
In United States and State of New York and State of Illinois v. Sony Corporation of America, LTM Holdings, Inc. d/b/a Loews Theatres Cineplex Odeon Corporation and J.E. Seagram, the Division challenged the proposed merger between Loews Theatres, a subsidiary of Sony Corporation, and Cineplex Odeon Corporation. The complaint alleged that the merger of these two movie theater chains would lessen competition substantially in the Manhattan and metro Chicago markets, leading to higher ticket prices and reduced theater quality for first-run movies. The merged firm would have had market shares, by revenue, of 67 percent in Manhattan and 77 percent in Chicago. A proposed consent decree was filed simultaneously settling the suit. The decree requires the divestiture of 14 theaters in Manhattan and 11 theaters in the Chicago area. In both Manhattan and Chicago, the divestitures represent slightly more than the leading firm would be acquiring in terms of both number of screens and revenue. The decree was entered by the court on November 16, 1998.
In United States v. Primestar, Inc., Tele-Communications, Inc., TCI Satellite Entertainment, Inc., Time Warner Entertainment Company, L.P., MediaOne Group, Comcast Corporation, Cox Communications, Inc., GE American Communications, Inc., Newhouse Broadcasting Corporation, The News Corporation Limited, MCI Communications Corporation and Keith Rupert Murdoch, the Division challenged Primestar's acquisition of the direct broadcast satellite ("DBS") assets of News Corporation Limited and MCI, alleging that it would allow five of the largest cable companies in the United States, which control Primestar, to protect their monopolies and keep out new competitors. The complaint alleged that the proposed $1.1 billion acquisition would lessen competition substantially and enhance monopoly power in multichannel video programming distribution, which includes cable, DBS and a few other types of video programming distribution, denying consumers the benefits of competition, including lower prices, higher quality, greater choice, and increased innovation. The proposed transaction called for News Corp./ MCI to transfer authorization to operate 28 satellite transponders at the 110 west longitude orbital slot and two high-power DBS satellites under construction to Primestar. The 110 slot is one of three that can be used to provide high-power DBS service -- which customers can receive using dishes as small as 18 inches in diameter -- to the entire continental U.S., and is the last position available for use or expansion by independent DBS firms. The complaint alleged that the transaction would prevent an independent firm from using the assets to compete directly and vigorously with the Primestar owners' cable systems and would eliminate the cable companies' most significant potential competitor, News Corp.'s ASkyB satellite venture. On October 14, 1998, Primestar abandoned its acquisition of News Corporation's and MCI's direct broadcast satellite assets.
In United States v. Aluminum Company of America and Alumax Inc., the Division challenged the proposed $3.8 billion acquisition of Alumax Inc. by Alcoa. The complaint alleged that the acquisition likely would have resulted in higher prices for customers of aluminum cast plate. Alcoa and Alumax are the two largest producers of aluminum cast plate and together control approximately 90 percent of the worldwide market for cast plate. Cast plate is a flat aluminum product that resists warping and is used in machinery that makes products for packaging frozen foods and aircraft and automotive parts. A proposed consent decree was filed simultaneously settling the suit. The decree requires Alcoa to sell its cast plate operations, including its Vernon, California plant that makes cast plate, to a firm that will continue to manufacture and sell cast plate.
