United States v. Iron Mountain, Inc.
217 F. Supp. 3d 146
D.D.C.2016Background
- Iron Mountain (largest) agreed to acquire Recall (second-largest) in a $2.6 billion transaction; both provide hard-copy records management services (RMS).
- The DOJ investigated and concluded the merger likely would lessen competition in 15 metropolitan geographic markets where RMS competition is local.
- The United States sued under Section 7 of the Clayton Act and simultaneously filed a Hold Separate Stipulation, a proposed Final Judgment requiring divestitures, and a Competitive Impact Statement.
- Proposed remedy: Recall must divest 26 storage facilities and associated assets (customer contracts) — in 13 markets to Access CIG, LLC and in 2 markets to a DOJ-approved buyer; mechanisms address employee transition, customer contract transfers (Split Multi-City Customers), and enforcement via a court-appointed Trustee if needed.
- A single public comment was filed by National Records Centers, Inc. (NRC), urging broader customer transfer rights and modifications to the Split Multi-City Customer definition; DOJ responded and the court reviewed the submissions under the Tunney Act.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the proposed Final Judgment is in the public interest under the Tunney Act | DOJ: divestitures in 15 markets will eliminate the asserted local anticompetitive effects | Iron Mountain/Recall (implicitly): parties agreed to remedy; specific defenses not prominent in opinion | Court: Approved — Final Judgment satisfies Tunney Act public-interest standard |
| Whether divestiture remedy is sufficiently precise and enforceable | DOJ: proposed Final Judgment provides detailed divestiture plan, timelines, Trustee enforcement, and customer-transfer rules | NRC argued remedies were too narrow and requested broader customer-switch rights and extensions | Court: Remedy sufficiently precise and enforceable; Trustee and procedures adequate; DOJ predictions entitled to deference |
| Whether scope of customer transfer relief should be expanded beyond specified markets | DOJ: relief limited to 15 affected markets; broader relief unnecessary and overbroad | NRC: all affected customers nationwide should be allowed fee-free transfers; extend Split Multi-City transfer period to 3 years | Court: Rejected broader relief; accepts DOJ scope and one-year transfer period to minimize disruption |
| Whether definition and treatment of Split Multi-City Customers is inadequate | DOJ: definition allows customers to consolidate with acquiring company without undue disruption | NRC: definition too narrow and should permit transfers to any provider and extend time | Court: Accepted DOJ's definition and one-year period as reasonably tailored to remedy harms |
Key Cases Cited
- United States v. Microsoft Corp., 56 F.3d 1448 (D.C. Cir. 1995) (courts must make independent public-interest determination but defer to DOJ’s predictions about remedy effectiveness)
- United States v. SBC Commc’ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (court should not reject consent decrees simply because other remedies are preferable)
- United States v. Abitibi-Consol, Inc., 584 F. Supp. 2d 162 (D.D.C. 2008) (Tunney Act requires factual basis showing settlement is a reasonably adequate remedy)