State v. Kraft General Foods, Inc., 93 Civ. 0811(KMW).
| Citation | 926 F. Supp. 321 |
| Decision Date | 22 February 1995 |
| Docket Number | No. 93 Civ. 0811(KMW).,93 Civ. 0811(KMW). |
| Parties | STATE of New York, Plaintiff, v. KRAFT GENERAL FOODS, INC., Nabisco Cereals, Inc., Nabisco, Inc., Philip Morris Companies Inc., RJR Nabisco Holdings Corp., and RJR Nabisco Inc., Defendants. |
| Court | United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York |
COPYRIGHT MATERIAL OMITTED
Richard Schwartz, Gary J. Malone, George Sampson, Beth Farmer, Maria Del Monaco, Timothy Cone, Robert Abrams, Attorney General, New York City, for Plaintiff.
Craig A. Newman, Arnold & Porter, New York City, Abe Krash, Donna Patterson, March Coleman, Brooksley Born, Michael Geske, Steve Reade, Arnold & Porter, Washington, D.C., Theodore L. Banks, Geoffrey Kent, Kraft General Foods Inc., Northfield, IL, for Kraft.
Richard C. Weisberg, Simpson, Thacher & Bartlett, New York City, for Nabisco.
Craig A. Newman, Arnold & Porter, New York City, March Coleman, Arnold & Porter, Washington, DC, for Philip Morris Companies, Inc.
Kraft General Foods, Inc. ("Kraft"), which owns Post cereals, entered into an agreement to buy the ready-to-eat ("RTE") cereal assets of Nabisco on November 12, 1992 (the "Acquisition"). The Federal Trade Commission reviewed the Acquisition pursuant to the requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, 15 U.S.C. § 18a. That Act's waiting period expired, without a challenge to the Acquisition, on December 24, 1992, and the Acquisition was consummated on January 4, 1993. Soon thereafter, the Nabisco assets were fully integrated into Kraft's Post Cereals Division.
On February 10, 1993, more than five weeks after the Acquisition was consummated, plaintiff, the State of New York's Attorney General (the "State"), initiated this suit seeking divestiture or recission pursuant to Section 7 of the Clayton Act, 15 U.S.C. § 18, Section 1 of the Sherman Act, 15 U.S.C. § 1, and the Donnelly Act, N.Y.Gen.Bus.Law §§ 340-344. Much of the procedural background of this case is set forth in the court's Opinion and Order of June 14, 1993, denying the State's first motion for a preliminary injunction. Familiarity with that opinion is assumed. The State maintains that the Acquisition may substantially lessen competition in what the State terms the adult RTE cereal market, or, in the alternative, in the entire RTE cereal market. The State seeks either (1) to rescind the transaction between Kraft and Nabisco, making it possible for Nabisco to reenter the RTE cereal business immediately, or (2) to divest Kraft of Nabisco's assets to another firm ("Newco") that could function in Nabisco's place as the sixth major competitor in the RTE market. By stipulation between the State and Nabisco, the action has been stayed as against Nabisco pending this court's determination of liability.
The State has twice moved for a preliminary injunction enjoining Kraft from implementing a proposed transition between its Post cereal brand and the Nabisco brand. The court denied both of the State's preliminary injunction motions, finding an insufficient threat of irreparable harm. After a...
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