UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION

Commissioners:
Timothy J. Muris, Chairman
Sheila F. Anthony
Mozelle W. Thompson
Orson Swindle
Thomas B. Leary

In the Matter of

LIBBEY INC., a corporation, and
NEWELL RUBBERMAID, INC., a corporation.

Docket No. 9301

COMPLAINT

The Federal Trade Commission ("Commission"), having reason to believe that respondents Libbey Inc. ("Libbey"), a corporation, and Newell Rubbermaid, Inc. ("Newell Rubbermaid"), a corporation, entered into (1) an agreement, dated as of June 17, 2001, for the acquisition by Libbey of the stock of Anchor Hocking Corporation ("Anchor") from Newell Rubbermaid, and (2) an amended agreement, dated as of January 21, 2002, for the acquisition by Libbey of the stock of Anchor from Newell Rubbermaid, both in violation of Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45, which acquisitions, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, and that a proceeding in respect thereof would be in the public interest, hereby issues its complaint, stating its charges as follows:

RESPONDENT LIBBEY

1. Respondent Libbey is a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 300 Madison Avenue, Toledo, Ohio 43699-0060.

2. Libbey is the largest maker and seller of food service glassware in the United States, with substantially more than half of the sales. Libbey produces and sells food service glassware, a line of products that includes many different styles of tumblers and stemware for beverages, and other glassware products ranging from serving platters to candle holders. Libbey produces and sells glassware, among other segments, to food service customers, including distributors who resell soda-lime glassware to restaurants, hotels and other food service establishments.

RESPONDENT NEWELL RUBBERMAID

3. Respondent Newell Rubbermaid is a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 29 East Stephenson Street, Freeport, Illinois 61032. Anchor is an indirect, wholly-owned subsidiary of Newell Rubbermaid.

4. Anchor is the third largest maker and seller of food service glassware in the United States. Anchor is Libbey's most formidable competitor in the food service glassware market.

JURISDICTION

5. Libbey is, and at all times relevant herein has been, engaged in commerce as "commerce" is defined in Section 1 of the Clayton Act, as amended, 15 U.S.C. 12, and is a corporation whose business is in or affects commerce as "commerce" is defined in Section 4 of the Federal Trade Commission Act, as amended, 15 U.S.C. 44.

6. Newell Rubbermaid is, and at all times relevant herein has been, engaged in commerce as "commerce" is defined in Section 1 of the Clayton Act, as amended, 15 U.S.C.  12, and is a corporation whose business is in or affects commerce as "commerce" is defined in Section 4 of the Federal Trade Commission Act, as amended, 15 U.S.C. 44.

THE ACQUISITION AND THE AMENDED MERGER AGREEMENT

7. Pursuant to a Stock Purchase Agreement dated June 17, 2001, Libbey proposed to acquire all of the stock of Anchor from Newell Rubbermaid (the "acquisition").

8. On December 18, 2001, the Commission authorized the commencement of an action under Section 13(b) of the FTC Act to seek a preliminary injunction barring the acquisition during the pendency of administrative proceedings. Thereafter, on January 14, 2002, the FTC commenced such an action in the United States District Court for the District of Columbia, and on April 22, 2002, the district court granted the FTC's motion for a preliminary injunction pending the completion of administrative adjudication.

9. On or about January 21, 2002, after the preliminary injunction action was commenced, respondents amended their merger agreement (the "amended merger agreement"). Respondents amended their merger agreement in response to the Commission's vote to challenge the acquisition. Pursuant to the amended merger agreement, Libbey would still acquire all of the stock of Anchor, but prior to closing Anchor would transfer to Newell Rubbermaid's Rubbermaid Commercial Products ("RCP") division less than 10% of the assets of Anchor, and the consideration to be paid by Libbey for Anchor would be reduced by less than 10%.

10. Under the amended merger agreement, the assets to be transferred to RCP are most (not all) of the molds, customer relationships and certain other assets used in Anchor's food service glassware business. Anchor would keep, and Libbey would still acquire, key assets used by Anchor in the food service glassware business, most significantly Anchor's two glassware manufacturing plants. Newell would not retain any capability to manufacture glassware.

11. After the district court granted the Commission's motion for a preliminary injunction, respondents told the court that Libbey would not solicit certain Anchor employees. At approximately the same time, Newell and a third party modified the price term under a supply agreement for RCP.

12. The amended merger agreement and the changes described in Paragraph 11 do not materially change the acquisition or its likely effect on competition.

RELEVANT MARKET

13. A relevant line of commerce in which to assess the effects of the acquisition and the amended merger agreement is food service glassware.

GEOGRAPHIC MARKET

14. The relevant geographic area in which to assess the effects of the acquisition and the amended merger agreement is the United States.

MARKET STRUCTURE

15. The United States food service glassware market is highly concentrated.

16. Libbey is the largest maker and seller of food service glassware in the United States, with substantially more than half of the sales.

17. Anchor is the third largest maker and seller of food service glassware in the United States.

18. Libbey and Anchor are direct and actual competitors in the manufacture and sale of food service glassware. They compete with each other on price by, among other things, offering discounts and other promotions on the sale of their food service glassware. Anchor prices and discounts its food service glassware in response to Libbey's pricing, and in order to take sales from Libbey. Anchor has succeeded in taking food service glassware sales from Libbey by offering lower prices to food service customers and distributors.

19. The acquisition and the amended merger agreement would combine the largest and third largest manufacturers and sellers of food service glassware in the United States, substantially increasing concentration in the food service glassware market, would result in a highly concentrated market, would eliminate the existing substantial competition between Libbey and Anchor, would impair the competitive viability of Newell Rubbermaid, and would substantially reduce competition and tend to create a monopoly in the market for food service glassware in the United States.

ANTICOMPETITIVE EFFECTS OF THE ACQUISITION
AND THE AMENDED MERGER AGREEMENT

20. The amended merger agreement, if consummated, would impair the competitive viability of Newell Rubbermaid as a competitor in the sale of food service glassware in the United States, and would reduce competition in the food service glassware market.

21. The acquisition and the amended merger agreement may substantially lessen competition in the following ways, among others:

a. they would eliminate actual, direct and substantial competition between Libbey and Anchor;
 
b. they would increase the level of concentration in the relevant market;

c. they may lead to increases in price for the relevant product;
 
d. they may increase barriers to entry into the relevant market;

e. they may give Libbey market power in the relevant market; and
 
f. they may allow Libbey to exercise market power in the relevant market either unilaterally or in coordination with others.

ENTRY CONDITIONS

22. Entry into the relevant product market would not be timely, likely, or sufficient in its magnitude, character, and scope to deter or counteract anticompetitive effects of the acquisition and the amended merger agreement.

VIOLATIONS CHARGED

COUNT I - ILLEGAL ACQUISITION

23. The allegations contained in Paragraphs 1-22 are repeated and realleged as though fully set forth here.

24. The effect of the acquisition may be substantially to lessen competition or tend to create a monopoly in violation of Section 7 of the Clayton Act, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, 15 U.S.C.  45.

COUNT II - ILLEGAL ACQUISITION AGREEMENT

25. The allegations contained in Paragraphs 1-22 are repeated and realleged as though fully set forth here.

26. Libbey and Newell Rubbermaid, through the Stock Purchase Agreement described in Paragraph 7, have engaged in unfair methods of competition in or affecting commerce in violation of Section 5 of the Federal Trade Commission Act, 15 U.S.C.  45.

COUNT III - ILLEGAL ACQUISITION

AMENDED MERGER AGREEMENT

27. The allegations contained in Paragraphs 1-22 are repeated and realleged as though fully set forth here.

28. The effect of the amended merger agreement may be substantially to lessen competition or tend to create a monopoly in violation of Section 7 of the Clayton Act, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, 15 U.S.C.  45.

COUNT IV - ILLEGAL ACQUISITION AGREEMENT

AMENDED MERGER AGREEMENT

29. The allegations contained in Paragraphs 1-22 are repeated and realleged as though fully set forth here.

30. Libbey and Newell Rubbermaid, through the amended merger agreement described in Paragraph 9 and the changes thereto described in Paragraph 11, have engaged in unfair methods of competition in or affecting commerce in violation of Section 5 of the Federal Trade Commission Act, 15 U.S.C.  45.

NOTICE

Proceedings on the charges asserted against you in this complaint will be held before an Administrative Law Judge (ALJ) of the Federal Trade Commission, under Part 3 of the Commission's Rules of Practice, 16 C.F.R. Part 3. A copy of Part 3 of the Rules is enclosed with this complaint.

You may file an answer to this complaint. Any such answer must be filed within 20 days after service of the complaint on you. If you contest the complaint's allegations of fact, your answer must concisely state the facts constituting each ground of defense, and must specifically admit, deny, explain, or disclaim knowledge of each fact alleged in the complaint. You will be deemed to have admitted any allegations of the complaint that you do not so answer.

If you elect not to contest the allegations of fact set forth in the complaint, your answer shall state that you admit all of the material allegations to be true. Such an answer will constitute a waiver of hearings as to the facts alleged in the complaint and, together with the complaint, will provide a record basis on which the ALJ will file an initial decision containing appropriate findings and conclusions and an appropriate order disposing of the proceeding. Such an answer may, however, reserve the right to submit proposed findings and conclusions and the right to appeal the initial decision to the Commission under Section 3.52 of the Commission's Rules of Practice.

If you do not answer within the specified time, you waive your right to appear and contest the allegations of the complaint. The ALJ is then authorized, without further notice to you, to find that the facts are as alleged in the complaint and to enter an initial decision and a cease and desist order.

The ALJ will schedule an initial prehearing scheduling conference to be held not later than 14 days after the last answer is filed by any party named as a respondent in the complaint. Unless otherwise directed by the ALJ, the scheduling conference and further proceedings will take place at the Federal Trade Commission, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. Rule 3.21(a) requires a meeting of the parties' counsel as early as practicable before the prehearing scheduling conference, and Rule 3.31(b) obligates counsel for each party, within 5 days of receiving a respondent's answer, to make certain initial disclosures without awaiting a formal discovery request.

A hearing on the complaint will begin on August 12, 2002, at 10:00 A.M. in Room 532, or such other date as determined by the ALJ. At the hearing, you will have the right to contest the allegations of the complaint and to show cause why a cease and desist order should not be entered against you.

NOTICE OF CONTEMPLATED RELIEF

Should the Commission conclude from the record developed in any adjudicative proceedings in this matter that the Stock Purchase Agreement described in Paragraph 7 or the amended merger agreement described in Paragraph 9 violates Section 5 of the Federal Trade Commission Act, as amended, or that the proposed acquisition or the proposed amended merger agreement challenged in this proceeding would, if consummated, violate Section 7 of the Clayton Act, as amended, or Section 5 of the Federal Trade Commission Act, as amended, the Commission may order such relief against respondents as is supported by the record and is necessary and appropriate, including, but not limited to:

1. An order to cease and desist from any action to effect the acquisition and the amended merger agreement by Libbey of any assets or securities of Newell Rubbermaid.

2. Rescission of the Stock Purchase Agreement and the amended merger agreement between respondents.

3. Divestiture of an ongoing, operating business, including all assets, tangible and intangible, including, but not limited to, all intellectual property, knowhow, trademarks, trade names, research and development, and customer contracts, and including all improvements to existing products and new products developed by Newell Rubbermaid.

4. Such other or additional relief as is necessary to ensure the creation of one or more viable, competitive, independent entities to compete against Libbey in the manufacture and sale of food service glassware.
 
5. A requirement, for a ten (10) year period, that Libbey and Newell Rubbermaid provide the Commission with notice in advance of acquiring the assets or securities of, or any other combination with, any person engaged in the manufacture or sale of food service glassware in the United States.

IN WITNESS WHEREOF, the Federal Trade Commission has caused this complaint to be signed by its Secretary and its official seal to be hereto affixed, at Washington, D.C. this ninth day of May, 2002.

By the Commission.

Donald S. Clark
Secretary

SEAL: