St. Regis Paper Company

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IN Tile MATTER OF ST. REGIS PAPER COMPANY, ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 61;76. Complaint, Dec. 1t15-Decision, Feb. , 1.95.9 Consent order requiring 17 of the nation s leading paper hag- manufacturersalleged, along with the f(Jur other manufacturers cited, to account for substantially all the more than two billion annual production of rnultiwall paper shipping sacks, and charged with using the same pricing formula to quote identical delivered prices to customers, regardless of location or freight costs-to cease entering into and carrying out any planned common course of action among themselves or with others to fix prices of said products.

In 1956 the examiner dismissed charges as to Raymond Bag Co. and Thomas Philips Co., who no longer made and sold the sacks. On April 11, 1959 (p. 1672 herein), charges were dismissed without prejudice as to the remaining two respondents, Fulton Bag and Cotton Mills and Equitable Paper Bag Co.

INITIAL DECISION AS TO ALL REMAINING RESPONDENTS EXCEPT FULTON BAG AND COTTON MILLS D EQUITABLE PAPER BAG COMPA M?" And,' ew C. Goodlw?)e, MT. Ross D. Young, JT. and MT. John Perechinslcy supporting complaint. LeBoeuf, Lamb Leiby, by MT. Homee R. Lamb and M?" Cmigh Leonard of New York, N.Y" for St. Regis Paper Company; Hale and D01'? by M?" Joseph N. Welch of Boston, Mass., for Bemis Brothers Bag Company;

1111. George GTubeT of New York, N. , for Arkel! & Smiths; Battle, Fowler, Neaman, Stolces Kheel by . Ludlow Fowler of New York, N. , for Chase Bag Company; Katzenbach and Salvatore by MT. F'mnlc S. Katzenbach, 11 I and MT. A,.thu1' A. Salva.!ote of Trenton, N. , for Universal Paper Bag Company;

MT. Ismel B. Oscas, of New York, N. , for Hudson Pulp & Paper Corporation;

Gallop, Climenlco Gould by M,' . Jesse Climenlco of New York, N. , for National Container Corporation; Davis, Pollc, Ward:well, SundeTland Kiendl by MT. Ralph M. Cm' son of New York, N. , for International Paper Company; ST. REGIS PAPER COMPANY, ET AL. 1163 1162 Decision by Mr, Joseph Hunton, Williams, Gay, Moore Powell Carter, Jr. of Richmond, Va., for Albemarle Paper Manufacturing Corporation, Seaboard Bag Corporation and Virginia-Carolina Chemical Corporation;

by M,.. Robe,. C. Ha'Tis Heller, Ehrman, White MeAuliffe of San Francisco, Calif., for Ames Harris N evi1e Company; Mr. Philip S. EhTlieh of San Francisco, Calif. , for Crown Zellerbach Corporation;

Dorff and Levy, by MT. 1, Alfred Levy, of New York, N. , for Gilman Paper Company;

Vinson, Elkins, Weems SeaTls by M,' . W. Buck Arnold Houston, Tex., for Lone Star Bag & Bagging Company; Mr, Carney W. Mirnms of New York, N. , for Union Bag- Camp Paper Corporation;

Stephens and Gignilliat by Mr. W. Hugh Stephens of Savannah, Ga., for Chemical Packaging Corporation. Before Mr. John Lewis hearing examiner. The Federal Trade Commission issued its complaint against the above-named respondents on December 7, 1955, charging them with the use of unfair methods of competition, in commerce, in violation of the Federal Trade Commission Act, by entering- into a combination or conspiracy to hinder, lessen, restrict and restrain competition in price in the sale and distribution of multiwall paper shipping sacks. After being served with said complaint, respondents appeared by counsel and filed their separate answers thereto. Thereafter, by orders dated respectively, February 20, 1956, and November 9, 1956, the complaint herein was dismissed as to respondents Raymond Bag Company and Thomas Philips Company on the ground, substantially, that said respondents had ceased engaging in the manufacture and sale of multiwall paper shipping sacks. Subsequently tbe remaining respondents, except Fulton Bag and Cotton 1Ii1s and Equitable Bag Co. entered into separate but identical agreements, dated December , 1958, containing a consent order to cease and desist purporting to dispose of al1 of this proceeding as to al1 remaining respondents, except Fulton Dag and Cotton :l1il1s and Equitable Bag Co. Said agreements, which have been signed by al1 respondents who arc parties thereto, by counsel for said respondents, and by counsel supporting tbe complaint, and approved by the director and assistant director of the Commission s Bureau of Litigation, have been submitted to the above-named hearing examiner for his 1164 FEDERAL TRADE COMMISSIO:\ DECISIO:\S Decision 55 F.

consideration, in accordance wit.h Section 3.25 of t.he Commission s Rules of Practice for Adjudicative Proceedings. The signatory respondent.s, pursuant to t.he aforesaid agreement.s, have admitted al1 the jurisdictional facts alleged in the complaint and agreed that the record may be taken as if findings of jurisdictional facts had been duly made in accordance wit.h such allegations. Said agreements further provide that. such respondents waive any further procedural steps before the hearing examiner and the Commission, the making of findings of fact or conclusions of law and al1 of the rights they may have to challenge or contest the validity of the order to cease and desist entered in accordance \with such agreement. It has been agre( that the order to cease and desist issued in accordance \with said agreements shall have the same force and effect as if entered after a full hearing and that. the complaint may be used in construing t.hc terms of said order. It has also been agreed that. t.he record herein shall consist. solely of t.he complaint and said agreement.s, and that said agreements are for settement. purposes only and do not const.itute an admission by respondents that. they have violated the law as alleged in the complaint. This proceeding having- no\\' come on for final consideration on the complaint and the aforesaid agreements containing consent order, and it appearing that the order provided for in said agreements covers al1 the allegations of the complaint and pro vides for an appropriate disposition of this proceeding as to all parties signatory thereto, said agreements are hereby accepted and are ordered filed upon this decision s becoming the decision of the Commission pursuant to Sections 3.21 and 3.25 of the Commission s Hules of Practice for Adjudicative Proceedings, and the hearing examiner, accordingly, makes the following jurisdictional findings and order:

1. Respondent St. Regis Paper Company is a corporation organized and existing under and by virtue of t.he laws of the Stat.e of :-ew York, wit.h it.s offce and principal place of business located at 150 East42d Street, New York, N. Respondent Remis Brothers Bag Company is a corporation organized and existing under and by virtue of the hl1NS of the State of Missouri, with its offce and principal place of business located at. 40 Central Street, Roston, ;\lass. Respondent. Arkell & Smiths is a corporation organized and exist.ing under and by virt.ue of the Jaws of t.he State of New ST. REGIS PAPER COMPANY, ET AL. 1165 1162 Decision York, with its offce and principal place of business located at Canajoharie, N.

Respondent Chase Bag Company is a corporation organized and existing under and by virtue of the laws of the State of Delaware - with its offce and principal place of business located at 155 East 44th Street, ;\ew York, N.

Respondent Universal Paper Bag Company is a corporation organized and existing under and by virtue of the laws of the Commonwealth of Pennsylvania, with its offce and principal place of business located at New Hope, Pa.

Respondent Hudson Pulp & Paper Corp. is a corporation organized and existing under and by virtue of the laws of the State of Maine, with its offce and principal place of business located at 477 Jladison Avenue, New York, N.

Respondent Kational Container Corporation is a corporation organized and existing- under and by virtue of the laws of the State of Delaware, with its notice and principal place of business located at 7 Central Park West, New York, N. Respondent International Paper Company is a corporation organized and existing under and by virtue of the laws of the State of Ne\v York, with its oftice and principal place of business located at 220 East 42nd Street, New York, N. Respondent Albemarle Paper l\lanl1facturing Company is a corporation organized and existing under and by virtue of the laws of the State of Virginia, with its offce and principal place of business located at Tredegar Street, Richmond, Va. Respondent Ames Harris Neville Company is a corporation organized and existing under and by virtue of the laws of the State of California, with its notice and principal place of business located at 2800 17th Street, San Francisco, Calif. Respondent Seaboard Bag Corporation, hereinafter referred to as respondent Seaboard, is a corporation, organized and existing under and by virtue of the laws of the State of Virginia with its offce ancl principal place of business located at 3405 Moore Street, Richmond, Va. It is engaged in the manufacture, sale and distribution oJ paper products including multiwall paper shipping sacks.

Respondent Lone Star Bag & Bagging Company, hereinafler referred to as respondent Lone Star, is a corporation organized and existing under and by virtue of the laws of the State of Texas with its office and principal place of business located at 2215 Dumble Road, Houston, Tex . It is engaged in the manu- Order 55 F.

facture, saJe and distribution of paper products including multiwall paper shipping sacks.

Respondent Union Bag & Paper Corporation, hereinafter referred to as respondent Union, is a corporation organized and existing under and hy virtue of the Jaws of the State of New York with its offce and principal place of business Jocated at 233 Broadway, New York, N.Y. It is engaged in the manufacture sale and distribution of paper products including multi wall paper shipping sacks.

Respondent Virginia-Carolina Chemical Corporation, hereinafter referred to as respondent Virginia-Carolina, is a corporation organized and existing under and by virtue of the laws of the State of Virginia with its offce and principal place of business Jocated at 401 East Main Street, Richmond, Va. It is en- Raged in the manufacture, saJe and distribution of paper products including muJtiwall paper shipping sacks. respondent Chemical Packaging Corporation . hereinafter refen' ed to as respondent Chemical, is a corporation organized and existing under and by virtue of the Jaws of the State of Georgia with its offce and principal place of business located at Atlantic CoastJine Wharves, Savannah, Ga. It is engaged in the manufacture, sale and distribution of paper products including multiwall paper shipping sacks.

Respondent Equitable Paper Bag Company, hereinafter re- Cerred to as respondent Equitable, is a corporation \with its offce and principal place of business located at 45-48 Van Dam Street Long Island City, X. Y. It is engaged in the manufacture, sale and distribution of paper products including multiwall paper shipping sacks. Respondent's state of incor1Joration is unknown. ORDER It is orclend That respondent corporations St. Regis Paper Company, Bemis Brothers Bag Company, Arkel1 & Smiths, Chase Rag Company, Universal Paper Bag Company, Hudson Pulp & Paper Corporation, National Container Corporatioll, International Paper Company, AJbemarJe Paper J\Ianufacturing Company, Ames Harris Nevil1e Company, Crown Zellerbach Corporation, Gilman Paper Company, Seaboard Bag Corporation, Lone Star Bag & Bagging Company, Union Bag Camp Paper Corporation, Virginia- Carolina Chemical Corporation, and Chemical Packaging Corporation, and their respective offcers, agents, and employees, in or in connection with the offering for salc, sale ST. REGIS PAPER COMPANY, ET AL. 1167 1162 Order and distribution of multi wall paper shipping sacks in interstate commerce, do cease and desist from entering into, continuing, cooperating or carrying out any planned common course of aeiion, agreement, understanding, combination or conspiracy between and among any two or more of said respondents, or between anyone or more of said respondents and others not parties hereto, to do or perform any of the following things: 1. Establishing, fixing or maintaining prices, terms, or conditions of sale for multi wall paper shipping sacks, or adhering to any prices, terms or conditions of sale so established or fixed. 2. Quoting or sellng multi wall paper shipping sacks at prices calculated or determined pursuant to or in accordance with a formula zone delivered price system or any other plan or system which prevents purchasers from securing any advantage in price in dealing with one or more of the respondents as againsi any of the other respondents or any others not parties hereto. 3. Circulating or exchanging between or among respondents or any of them, a formula for pricing of multi wall paper shipping sacks, or price factors, or terms or conditions of sale for the prking of multhvaJl paper shipping sacks, or a Ust or lists of zone delivered prices or of prices by any other designation for mu1tiwa1l paper shipping sacks, or zone differentials or changes of zone differentials.

4. Using, directly or indirectly, in computing price quotations or in making, quoting or in charging prices, any such formula or price factor or zone differential obtained Jrom another respondent by means of such circulation or exchange. Provided howe1Jer, That in interpreting and construing the foregoing provisions of this order, it is understood that: (J) The Federal Trade Commission is not. acting to prohibit or interfere with, any respondent from entering into a bona fide offer, agreement or transaction vdth any other manufacturer wholesaler, jobber or agent for the sale of multi wall paper shipping sacks, whether or not such other manufacturer, wholesaler johber or agent is a respondent, to buy from, to sell to, or to manufacture for the account of any such other manufacturer wholesaler, jobber, or agent multiwa1l paper shipping sacks at any price or on any terms and conditions of sale independently determined and offered and independently accepted in any bona fide agrcement or transaction.

(2) Nothing contained in this order shall be construed as prohibiting any of the respondents from taking such action relating 1168 FEDERAL TRADE COMMISSION DECISIOKS Decision 55 F.

to its export sales as would be lawful under the provisions of the Webb-Pomerene Export Tracie Act.

DECISION OF THE COMMISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice, the initial decision of the hearing examiner shall, on the 12th day of February 1909, become the decision of the Commission; and, accordingly:

It 'is O1'dered That the respondents SL Regis Paper Company, Bemis Brothers Bag Company, Arkell & Smiths, Chase Bag Company, Universal Paper Bag Company, Hudson Pulp & Paper Corporation, National Container Corporation, International Paper Company, Albemarle Paper Manufacturing Company, Ames Harris Nevi1e Company, Crown Zellerbach Corporation, Gilman Paper Company, Seaboard Bag Corporation, Lone Star Bag & Bagging Company, Union Bag-Camp Paper Corporation, Virginia- Carolina Chemical Corporation, and Chemical I)ackaging Corporation, shall within sixty (60) clays after service upon them of this order, file \with the Commission a report in \writing setting forth in detail the manner and form in which they have complied with the order to cease and desist. RENAIRE CORPORATION (PENNSYLVANIA) ET AL. 1169 Decision