Occidental Petroleum Corporation

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF OCCIDENTAL PETROLEUM CORPORATION, ET AL.

MODIFYING ORDER IN REGARD TO ALLEGED VIOLATION OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Doket C-2492. Consent Order, March 1974-Modifying Order, March, 1983 This order reopens the proceeding and modifies the Commission s order issued on March 18, 1974 (83 F. C. 1374) The modification deletes the order s "fencingprovision, including the requirement that prohibited Occidental from preparing statistical data comparing its purchases from a company to its sales to that company, and vacates the order in its entirety 10 years after its March 1974 issue date. REOPENING AND VACATING IN PART AND MODIFYING IN PART ORDER ISSUED MARCH 18, 1974 On November 8, 1982, respondent Occidental Petroleum Corporation ("Occidental") fied a "Request To Reopen And Vacate Or Modify Consent Order Petition ), pursuant to Section 5(b) of the Federal Trade Commission Act, 15 U. C. 45(b) and Section 2.51 of the Commission s Rules of Practice. The Petition asks the Commission to reopen the consent order, issued on March 18 1974 ("the Order ), and either: vacate the Order in its entirety; modify to limit the duration to a ten-year period; or modify "to bring it in line with current case law and enforcement attitudes.

Section 5(b) of the Federal Trade Commission Act provides that the Commission shall reopen an order at the request ofa respondent upon a "satisfactory showing that changed conditions of law or fact require" modification. In addition, Section 5(b) provides that the Commission has discretion to modify orders whenever, in its opinion, the public interest requires.

After reviewing respondent's Petition, the Commission has concluded that respondent has not made a satisfactory showing that changed conditions of law or fact have occurred that require the modification or vacation ofthe Order. However, the Commission has determined that the public interest warrants modifying the pending Order in two respects.

First, a number of the Order s provisions are aimed at !!fencingrespondent's future conduct. See FTCv. National Lead Co., 352 U. 419 (1957). Although some of these provisions may have been justified at the time the Order was initially approved, their continued existence unnecessarily inhibits respondent from engaging in conduct which, in and of itself, is innocuous and may, in certain circum- Dissenting Statement 101 F. stances, be procompetitive. In addition, there no longer appears to be any need for continuing the "fencing- " provisions of the Order. No adverse comments were received indicating any special need to retain them and the Commission has no reason to believe that the Order has or is being violated in any respect.

These same arguments support vacating the remaining provisions ofthe Order at the end of a ten year period. In certain cases, perpetual conduct orders are appropriate in order to insure that violations of Commission orders are subject to civil penalties rather than forcing the Commission to initiate proceedings ab initio. However, we have no evidence in this record that would support retaining the provisions of this Order in perpetuity.

Accordingly, it is ordered that Paragraphs 1(D, (g), (h) and II of this Order be vacated at this time and the remaining provisions be vacated ten years from date of their initial entry, March 18, 1974. Commissioner Bailey voted in the affrmative as to elimination of the fencing-in provisions and in the negative as to sunsetting the Order. Commissioner Pertschuk voted in the negative. DISSENTING STATEMENT OF COMMISSIONER PERTSCHUK I agree that the broad "fencing- " provisions in the order are no longer necessary and should be narrowed to prohibit only anticompetitive reciprocal dealing. The Commission goes further, however, by terminating the order completely after ten years. Our general policy in the past has been to issue perpetual conduct orders as to conduct which actually violates Section 5 unless there are persuasive reasons to create an exception. Here, however, the Commission appears to reverse that presumption by requiring "evidence in this record" supporting a perpetual order. It is not clear that the Commission is making a change in policy for future cases, but, in any event, I dissent from the result in this case. STERLING DRUG, INC., ET AL. 375 375 Modifying Order