-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VZD2Gw88aoGNtM9erXxVEB1yYbnDleSsttAlP/zBZRr5KMhdSBMUgnh5M/JebY8S XZCrHs/VXcYhp/ODxA4Fxg== 0000950131-96-006137.txt : 19961203 0000950131-96-006137.hdr.sgml : 19961203 ACCESSION NUMBER: 0000950131-96-006137 CONFORMED SUBMISSION TYPE: SC 14D9/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19961202 SROS: NYSE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: LOEWEN GROUP INC CENTRAL INDEX KEY: 0000845577 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PERSONAL SERVICES [7200] IRS NUMBER: 980121376 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D9/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-43525 FILM NUMBER: 96675016 BUSINESS ADDRESS: STREET 1: 4126 NORLAND AVE CITY: BURNABY BC CANADA V5 STATE: A1 ZIP: V5G 3S8 BUSINESS PHONE: 6042999321 MAIL ADDRESS: STREET 1: 4126 NORLAND AVE STREET 2: BRITISH COLUMIA CITY: BURNABY V5G 3S8 STATE: A1 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: LOEWEN GROUP INC CENTRAL INDEX KEY: 0000845577 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PERSONAL SERVICES [7200] IRS NUMBER: 980121376 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D9/A BUSINESS ADDRESS: STREET 1: 4126 NORLAND AVE CITY: BURNABY BC CANADA V5 STATE: A1 ZIP: V5G 3S8 BUSINESS PHONE: 6042999321 MAIL ADDRESS: STREET 1: 4126 NORLAND AVE STREET 2: BRITISH COLUMIA CITY: BURNABY V5G 3S8 STATE: A1 SC 14D9/A 1 AMENDMENT #4 TO SCHEDULE 14D-9/A ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _______________ SCHEDULE 14D-9/A (AMENDMENT NO. 4) SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO SECTION 14(D)(4) OF THE SECURITIES EXCHANGE ACT OF 1934 _______________ THE LOEWEN GROUP INC. (Name of Subject Company) THE LOEWEN GROUP INC. (Name of Person(s) Filing Statement) COMMON SHARES, WITHOUT PAR VALUE (AND ASSOCIATED SHARE PURCHASE RIGHTS) 6.00% CUMULATIVE REDEEMABLE CONVERTIBLE FIRST PREFERRED SHARES, SERIES C, WITHOUT PAR VALUE (Title of Class of Securities) 54042L100 54042L407 (CUSIP Number of Class of Securities) _______________ Peter S. Hyndman Vice President, Law and Corporate Secretary The Loewen Group Inc. 4126 Norland Avenue Burnaby, British Columbia Canada V5G 3S8 (604)299-9321 (Name, Address and Telephone Number of Person Authorized to Receive Notice and Communications on Behalf of the Person(s) Filing Statement) WITH A COPY TO: Lyle G. Ganske, Esq. Jones, Day, Reavis & Pogue North Point 901 Lakeside Avenue Cleveland, Ohio 44114 (216) 586-3939 ================================================================================ This statement amends and supplements the Solicitation/Recommendation Statement on Schedule 14D-9, as amended (the "Schedule 14D-9") of The Loewen Group Inc., a corporation incorporated under the laws of British Columbia, Canada (the "Company"), initially filed with the Securities and Exchange Commission (the "Commission") on October 10, 1996, with respect to the proposed exchange offers (the "Second SCI Proposal") announced on October 2, 1996, and disclosed in a Registration Statement on Form S-4, as amended (the "Registration Statement") initially filed with the Commission on October 3, 1996, by New Service Corporation International, a Delaware corporation ("New SCI"), and SCI Holdings Canada, Inc., a company incorporated under the laws of British Columbia, Canada ("Canadian SCI"), each a wholly owned direct or indirect subsidiary of Service Corporation International, a Texas Corporation ("SCI"). The proposed exchange offers contemplated by the Second SCI Proposal have not yet commenced. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Schedule 14D-9. ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED. Item 8 is amended and supplemented hereby by inserting the following new paragraph after the second paragraph of Item 8(a): On November 29, 1996, the United States District Court for the Southern District of Texas (the "Texas Court") granted the motion of the Company and co-defendants Loewen Group, Inc. and LGII (collectively, the "Defendants") to dismiss SCI's action against the Defendants. Copies of the Texas Court's Memorandum Opinion and the Company's related press release are included as Exhibits 49 and 50 to this Schedule 14D-9, respectively, and are incorporated herein by reference. In the Memorandum Opinion, the Texas Court found that SCI filed its declaratory judgment action in anticipation of the Company filing an antitrust suit against SCI, that SCI sought to preempt the Company's lawsuit in order to gain an unfair advantage in choosing the forum for an antitrust action, and that SCI's tortious interference and securities law claims were related to the Company's antitrust claims and thus should be resolved in the Company's New York antitrust action, described below. The fourth paragraph of Item 8(b) is hereby amended and supplemented to read in its entirety as follows: The Company has also received numerous other requests for information from states' attorneys general. On September 27, 1996, the Office of the Attorney General of the State of New York requested data from the Company in connection with an investigation of the First SCI Proposal and the Second SCI Proposal. On September 30, 1996, the Office of the Attorney General of the State of Alaska requested data from the Company in connection with an investigation of the First SCI Proposal and the Second SCI Proposal. On October 2, 1996, the Office of the Attorney General of the State of Hawaii requested data from the Company in connection with an investigation of the Second SCI Proposal. On October 3, 1996, the Office of the Attorney General for the State of Texas requested information from the Company in connection with an investigation of the Second SCI Proposal. On October 4, 1996, the Office of the Attorney General of the State of California requested information from the Company in connection with an investigation of the Second SCI Proposal. On October 9, 1996, the Attorney General of the State of Tennessee requested information from the Company in connection with an investigation of the Second SCI Proposal. On October 11, 1996, the Company received a written request for data from the Commonwealth of Pennsylvania's Office of the Attorney General in connection with an investigation of the Second SCI Proposal. A copy of the Company's press release regarding this investigation is included as Exhibit 44 to this Schedule 14D-9 and is incorporated herein by reference. On October 18, 1996, the Attorney Generals of the States of Washington and Oregon individually requested information from the Company in connection with their offices' respective investigations of the Second SCI Proposal. A copy of the Company's press release regarding the Washington and Oregon investigations is included as Exhibit 46 to this Schedule 14D-9 and is incorporated herein by reference. On December 2, 1996, the Office of the Attorney General of the State of North Carolina requested information from the Company in connection with an investigation of the Second SCI Proposal. On December 2, 1996, the Company received a request for information from the State of New Mexico in connection with an investigation of the Second SCI Proposal. 1 ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. Except for Exhibits 49 and 50 which are filed herewith, the following Exhibits were previously filed with the Schedule 14D-9:
Exhibit 1 -- Letter from L. William Heiligbrodt to Raymond L. Loewen, dated September 17, 1996. Exhibit 2 -- Letter from L. William Heiligbrodt to Raymond L. Loewen, dated September 18, 1996. Exhibit 3 -- Letter to Shareholders from Raymond L. Loewen, dated September 24, 1996. Exhibit 4 -- Letter to L. William Heiligbrodt from Raymond L. Loewen, dated September 24, 1996. Exhibit 5 -- [Intentionally omitted]. Exhibit 6 -- Press Release issued by Loewen, dated September 17, 1996. Exhibit 7 -- [Intentionally omitted]. Exhibit 8 -- Press Release issued by Loewen, dated September 24, 1996. Exhibit 9 -- Press Release issued by Loewen, dated September 27, 1996. Exhibit 10 -- Press Release issued by Loewen, dated October 1, 1996. Exhibit 11 -- Press Release issued by SCI, dated October 2, 1996. Exhibit 12 -- Press Release issued by Loewen, dated October 2, 1996. Exhibit 13* -- Press Release issued by Loewen, dated October 10, 1996. Exhibit 14 -- Complaint in KRIM V. BAGNELL, ET AL. (Superior Court of the State of California). Exhibit 15 -- First Amended Complaint in SERVICE CORPORATION INTERNATIONAL V. THE LOEWEN GROUP INC. (United States District Court for the Southern District of Texas). Exhibit 16 -- Complaint in THE LOEWEN GROUP INC. V. SERVICE CORPORATION INTERNATIONAL, ET AL. (United States District Court for the Eastern District of New York). Exhibit 17* -- Opinion letter of Smith Barney Inc. to Loewen Board of Directors, dated October 10, 1996. Exhibit 18* -- Opinion letter of Nesbitt Burns Inc. to Loewen Board of Directors, dated October 10, 1996. Exhibit 19 -- Pages 15 - 20 and 32 - 34 of The Loewen Group Inc. Proxy Statement, dated April 9, 1996. Exhibit 20 -- The Loewen Group Inc. Employee Stock Option Plan (United States). Exhibit 21 -- The Loewen Group Inc. Employee Stock Option Plan (Canada). Exhibit 22 -- Form of The Loewen Group Inc. Employee Stock Option Plan Agreement (Directors of Loewen Group International, Inc.). Exhibit 23 -- Form of The Loewen Group Inc. Employee Stock Option Plan Agreement (Directors of subsidiaries). Exhibit 24 -- Form of The Loewen Group Inc. Employee Stock Option Plan Agreement (employees). Exhibit 25 -- The Loewen Group Inc. Employee Share Purchase Plan (United States). Exhibit 26 -- The Loewen Group Inc. Employee Share Purchase Plan (Canada).
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Exhibit 27 -- The Loewen Group Inc. 1994 Management Equity Investment Plan. Exhibit 28 -- Form of The Loewen Group Inc. 1994 Management Equity Investment Plan Investment Option Agreement. Exhibit 29 -- The Loewen Group Inc. Supplement to 1994 Management Equity Investment Plan. Exhibit 30 -- The Loewen Group Inc. Addendum to 1994 Management Equity Investment Plan. Exhibit 31 -- Form of The Loewen Group Inc. Management Equity Investment Plan Borrowing Agreement. Exhibit 32 -- Form of The Loewen Group Inc. Management Equity Investment Plan Executive Agreement. Exhibit 33 -- Form of The Loewen Group Inc. Management Equity Investment Plan 1994 Exchangeable Floating Rate Debenture due July 15, 2001. Exhibit 34 -- The Loewen Group Inc. 1994 Outside Director Compensation Plan. Exhibit 35 -- The Loewen Group Inc. Employee Stock Bonus Plan. Exhibit 36 -- The Loewen Group Inc. Shareholder Protection Rights Plan Agreement and Amendments. Exhibit 37 -- Employment Agreement with Timothy R. Hogenkamp. Exhibit 38 -- [Intentionally omitted]. Exhibit 39 -- Form of Indemnification Agreement with Outside Directors. Exhibit 40 -- Form of Indemnification Agreement with Officers. Exhibit 41 -- Form of The Loewen Group Inc. Severance Agreement. Exhibit 42 -- The Loewen Group Inc. Severance Pay Plan. Exhibit 43* -- Letter to Shareholders from Raymond L. Loewen, dated October 10, 1996. Exhibit 44 -- Press Release issued by Loewen, dated October 14, 1996. Exhibit 45 -- Press Release issued by Loewen, dated October 17, 1996. Exhibit 46 -- Press Release issued by Loewen, dated October 20, 1996. Exhibit 47 -- Press Release issued by Loewen, dated November 1, 1996. Exhibit 48 -- Press Release issued by Loewen, dated November 3, 1996. Exhibit 49 -- Memorandum Opinion dated November 27, 1996 (United States District Court for the Southern District of Texas). Exhibit 50 -- Press Release issued by Loewen, dated December 1, 1996. - -------------------------
* Exhibits distributed to Shareholders. -3- SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Schedule 14D-9 is true, complete and correct. THE LOEWEN GROUP INC. By: /s/ Peter S. Hyndman ----------------------------------- Name: Peter S. Hyndman Title: Vice President, Law and Corporate Secretary Dated: December 2, 1996 EX-99.1 2 MEMORANDUM OPINION DTD. 11-27-96 EXHIBIT 49 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION SERVICE CORPORATION, (S) INTERNATIONAL, (S) (S) Plaintiff, (S) (S) CIVIL ACTION NO. H-96-3269 v. (S) (S) THE LOEWEN GROUP INC., (S) LOEWEN GROUP, INC., AND (S) LOEWEN GROUP INTERNATIONAL, (S) INC., (S) (S) Defendants. (S) MEMORANDUM OPINION ------------------ Pending before the Court are Defendants' Motion to Dismiss (Docket #4), and Plaintiff's Motion for Preliminary Injunction (Docket #10). After considering the motions, responses, replies, hearing transcripts, and the applicable law, the Court is of the opinion that Defendants' Motion to Dismiss should be GRANTED and Plaintiff's Motion for Preliminary Injunction should be DENIED, as set forth herein. I. BACKGROUND This case arises out of Service Corporation International's ("SCI") attempts to take over The Loewen Group ("Loewen"). After Loewen's board of directors rejected SCI's proposal of a stock swap merger, Loewen allegedly began making public comments that suggested the combination would violate the antitrust laws and invite FTC scrutiny. On October 1, 1996, SCI's board approved a tender offer for all outstanding Loewen stock and on the same day filed this action in the Southern District of Texas seeking, inter alia, a declaration that Loewen has no standing under the antitrust laws to institute an action to block or impede SCI's attempted takeover./1/ Thereafter, on October 10, 1996, Loewen filed an antitrust action in the Eastern District of New York to enjoin SCI's attempted takeover. The parties filed motions to dismiss in each court; Loewen in this Court, and SCI in New York. After a hearing, the New York court refused to dismiss or stay the suit filed in its court, so SCI moved this court to enjoin Loewen from pursuing the New York action based on the first-to-file doctrine. Loewen, in turn, vigorously opposes SCI's request for an injunction and urges the Court to grant its motion to dismiss. II. DISCUSSION This controversy requires the Court to apply the first-to-file rule, which dictates that "[I]n the absence of compelling circumstances, the Court initially seized of a controversy should be the one to decide whether it will try the case." Dillard v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 961 F.2d 1148, 1161 n.28 (5th Cir. 1992); Mann Mfg., Inc. v. Hortex, Inc., 439 F.2d 403, 407 (5th Cir. 1971). The first-to-file rule is applicable when there are two pending actions involving substantially similar issues or are so duplicative that one court should decide both controversies. California Security Co-op, Inc. v. Multimedia - ------------------ /1/SCI's initial Complaint includes the declaratory judgment claim, and a claim for tortious interference with prospective business relations. On October 3, 1996, SCI Amended its complaint to add a claim under (S) 14(e) of the Securities Exchange Act. 2 Cablevision, Inc., 897 F. Supp. 316, 317 (E.D. Tex. 1995) (citing Texas Instruments Inc. v. Micron Semiconductor, Inc., 815 F. Supp. 994, 997 (E.D. Tex. 1993)); see Mann Mfg., 439 F.2d at 407 (first-to-file rule applies when there is a substantial likelihood of overlap). When the first-to-file rule applies, the first-filed court decides which case should proceed. West Gulf Maritime Ass'n v. ILA DeepSea Local 24, 751 F.2d 721, 729 (5th Cir. 1985); Mann Mfg., 439 F.2d at 408; Texas Instruments, 815 F.2d at 997. This case and the New York case involve substantially similar issues such that the first-to-file rule should apply. The New York case involves the claim that SCI's takeover of Loewen would violate the antitrust laws. The case in this Court involves claims that Loewen does not have standing to bring an antitrust suit to enjoin SCI's takeover, and that Loewen's public suggestions that the takeover would violate the antitrust laws were illegal. Clearly these are substantially similar and related lawsuits which should, if possible, be consolidated. The question, then, is which forum should proceed with the case. As the first-filed forum, this Court has the responsibility of determining which action will proceed. Although the rule is that the first- filed court should adjudicate the matter, this Court can defer to the later- filed court when "compelling circumstances" are present. West Gulf, 751 F.2d at 729; Mann Mfg., 439 F.2d at 407; California Security Co-op, 897 F. Supp. at 318. One such compelling circumstance is when the suit was brought in one forum in anticipation of the opposing party bringing suit in another, less favorable forum. See California 3 Security Co-op, 897 F. Supp. at 319 (recognizing exception to first-to-file rule when first suit brought in anticipation of the second); 909 Corp. v. Village of Bolingbrook Police Pension Fund, 741 F. Supp. 1290, 1292-93 (S.D. Tex. 1990) (recognizing policy against anticipatory suits brought to choose the forum); EEOC v. University of Pennsylvania, 850 F.2d 969, 976 (3d Cir. 1988) (noting that "courts have rejected the [first-to-file] rule . . . when the first-filing party instituted suit in one forum in anticipation of the opposing party's imminent suit in another, less favorable, forum."). See also BASF Corp. v. Symington, 50 F.3d 555, 558 (8th Cir. 1995) (noting that "a suit for a declaratory judgment aimed solely at wrestling the choice of forum from the `natural' plaintiff will normally be dismissed") (quoting Allendale Mut. Ins. Co. v. Bull Data Systems, Inc., 10 F.3d 425, 431 (7th Cir. 1993)). After considering the allegations of the parties in the two lawsuits and the circumstances under which they were brought, this Court finds that SCI's suit in this Court was filed in anticipation of Loewen filing its antitrust suit in New York. SCI argues that it had no way to know with certainty that Loewen would file an antitrust suit, but the facts belie the conclusion that its suit was not anticipatory. The relief sought by SCI in its declaratory judgment claim is anticipatory by nature. SCI does not seek a declaration that the takeover of Loewen would not violate the antitrust laws -- it seeks a declaration that "the Loewen Defendants lack standing to institute, and accordingly may not institute, any action seeking to block or impede any SCI exchange 4 offer for Loewen stock under any theory of federal antitrust law." First Amended Complaint at 16. To seek a declaration that an opposing party may not bring a lawsuit is to anticipate that it will. Indeed, if it did not anticipate a lawsuit, its declaratory claim would lack the immediacy required for the controversy to be justiciable. Cf., Rowan Companies, Inc. v. Griffin, 876 F.2d 26, 28 (5th Cir. 1989) ("A controversy, to be justiciable, must be such that it can presently be litigated and decided and not hypothetical, conjectural, conditional or based upon the possibility of a factual situation that may never develop."); National Basketball Ass'n v. SDC Basketball Club, Inc., 815 F.2d 562, 566 (9th Cir. 1987) (holding that a potential antitrust defendant has standing to bring suit for a declaration of non-liability once there is a "real and reasonable apprehension" of actions that will create the controversy). Thus, either SCI's declaratory judgment claim is anticipatory, or it is nonjusticiable. In addition, the circumstances of this case indicate that SCI sought to preempt Loewen's impeding lawsuit in order to have the choice of forum. SCI filed this lawsuit on the very same day that its board decided to make a tender offer for Loewen's stock, and before the tender offer was made public or even made known to Loewen's principals. This give it an unfair advantage in the "race to the courthouse" because Loewen, for purposes of its antitrust suit, had nothing yet of which to complain./2/ And the race to the - ----------------------- /2/ A tender offer is "a public made invitation addressed to all shareholders of a corporation to tender their shares for sale (continued...) 5 courthouse was important to the parties in this action because the Second Circuit, which is where Loewen brought its antitrust suit, is the only circuit that currently permits the target of a takeover to bring suit to enjoin the takeover on antitrust grounds./3/ The Court is sympathetic to SCI's situation: the Second Circuit's minority position on antitrust standing encourages forum shopping by target companies seeking to block hostile takeovers. However, this does not change the facts or the Court's analysis. SCI seems to argue that even if its suit was anticipatory, this Court may not discard the first-to-file rule unless the lawsuit was brought in Texas solely for the purpose of forum shopping. That is, it appears to argue that the presence of - --------------------- /2/( . . . continued) at a specified price." M. LIPTON & E.H. STEINBERGER, TAKEOVERS & FREEZEOUTS (S) 2.02 (1991). Until such a tender offer is commenced, the parties have no standing to complain of actions preventing the tender offer, or of the tender offer itself. See, e.g., Armstrong World Indus. Inc. v. Adams, 961 F.2d 405, 414 (3d Cir. 1992); Moore Corp. Ltd. v. Wallace Computer Svcs., Inc., 898 F. Supp. 1089, 1095 (D. Del. 1995). In this case, until SCI informed Loewen of its intentions of making a tender offer, or until SCI made a "public made invitation addressed to all shareholders," they lacked constitutional standing to bring suit to enjoin the tender offer. /3/ See Consolidated Gold Fields PLC v. Minorco, S.A., 871 F.2d 252, 257- 60 (2d Cir.), cert. dismissed, 492 U.S. 939, 110 S. Ct. 29, 106 L.Ed.2d 639 (1989). Most other circuits that have addressed the issue, including the Fifth Circuit, have held that the target of a takeover lacks antitrust standing. See Anago, Inc. v. Tecnol Medical Prods., Inc., 976 F.2d 248, 250 (5th Cir. 1992), cert. dismissed, 510 U.S. 985, 114 S. Ct. 491, 126 L.Ed.2d 441 (1993); McDonald v. Johnson & Johnson, 722 F.2d 1370, 1375 (8th Cir. 1983), cert. denied, 469 U.S. 870, 105 S. Ct. 219, 83 L.Ed.2d 149 (1984); Central Nat'l Bank v. Rainbolt, 720 F.2d 1183, 1186 (10th Cir. 1983); Chrysler Corp. v. Fedders Corp., 643 F.2d 1229, 1235 (6th Cir.), cert. denied, 454 U.S. 893, 102 S. Ct. 388, 70 L.Ed.2d 207 (1981); A.D.M. Corp. v. Sigma Instruments, Inc., 628 F.2d 753, 754 (1st Cir. 1980). See also BNS Inc. v. Koppers Co., Inc., 848 F.2d 945, 954 (9th Cir. 1988) (Beezer, J., dissenting). 6 any legitimate reasons for its choice of forum defeats, as a matter of law, a claim of "compelling circumstances." In support of this argument, SCI cites Mattel, Inc. v. Louis Marx & Co., 353 F.2d 421, 424 n.4 (2d Cir. 1965), cert. dismissed, 384 U.S. 948, 86 S. Ct. 1475, 16 L.Ed.2d 546 (1966), Rayco Mfg. Co. v. Chicopee Mfg. Co., 148 F. Supp. 588, 593-94 (S.D.N.Y. 1957), and Fisher & Porter Co. v. Moorco Int'l Inc., 869 F. Supp. 323, 325 (E.D. Pa. 1994). All of these cases, in addition to being from other jurisdictions, are distinguishable. In Mattel, the court merely listed filing suit solely for forum shopping as one reason courts have discarded the first-to-file rule. In Rayco, the case cited by Mattel, the court simply decided to discard the first-to-file rule because forum shopping was the sole reason for the first-filed suit. And in Fisher & Porter, the court just listed filing suit solely for forum shopping as one reason to discard the first-to-file rule. Notably, that court also recognized filing an anticipatory suit to avoid the effect of another jurisdiction's law as another reason to discard the first-to-file rule. Fisher & Porter, 869 F. Supp. at 325. Thus, none of the cases cited by SCI support the proposition that forum shopping must be the sole reason for the first suit in order to set aside the first-to-file rule. If this case were merely a declaratory judgment action, this Court would be compelled to dismiss it. As discussed supra, SCI's declaratory judgment claim was clearly brought in anticipation of Loewen's antitrust suit, and such actions should generally be dismissed by the district court. See Rowan Companies, 876 F.2d at 29; BASF Corp., 50 F.3d at 558-59; Allendale, 10 F.3d 7 at 431; 909 Corp., 741 F. Supp. at 1292. The only remaining question, then, is whether there are compelling circumstances to dismiss the entire action in favor of the case in New York. The Court finds compelling circumstances to allow the later-filed New York action to proceed with the entire controversy. First, the heart of this action is the declaratory judgment claim, which was improperly brought and must be dismissed. The remaining claims -- tortious interference with prospective business relations, and violations of (S) 14(e) of the Securities Exchange Act - -- are intimately connected to Loewen's antitrust claims. These claims could be fully and adequately adjudicated as counterclaims to Loewen's antitrust suit in New York, and in the interest of comity, the orderly administration of justice, and the avoidance of piecemeal litigation, this Court finds compelling reasons to dismiss the claims so that they can all proceed in the same judicial proceeding. III. CONCLUSION In light of the foregoing, the Court finds compelling reasons to disregard the first-to-file rule. It is therefore ORDERED that Defendants' Motion to Dismiss (Docket #4) is GRANTED, and Plaintiff's Motion for Preliminary Injunction (Docket #10) is DENIED. Plaintiff's declaratory judgment claim is dismissed, and Plaintiff's tortious interference and (S) 14(e) claims are dismissed subject to the New York court permitting them to be asserted as counterclaims in that action. The clerk shall enter this Order and provide a true copy to all parties. 8 Signed this 27th day of November, 1996. ---- -------- /s/ John D. Rainey ---------------------------- JOHN D. RAINEY UNITED STATES DISTRICT JUDGE 9 EX-99.2 3 PRESS RELEASE BY LOEWEN DTD. 11-1-96 EXHIBIT 50 Contacts: David A. Laundy The Loewen Group Inc. (604) 293-7857 Thomas C. Franco Broadgate Consultants, Inc. (212) 229-2222 FOR IMMEDIATE RELEASE ===================== LOEWEN GROUP PREVAILS IN TEXAS FEDERAL COURT Loewen's Antitrust Lawsuit Against SCI To Proceed In New York Federal Court All Other SCI Claims Also Dismissed - -------------------------------------------------------------------------------- VANCOUVER, December 1, 1996 -- The Loewen Group Inc. (NYSE, TSE, ME: LWN) announced today that the United States District Court for the Southern District of Texas has granted its motion to dismiss the lawsuit that Service Corporation International (SCI) filed the day before commencing its proposed hostile exchange offer for Loewen. The Texas federal court dismissed SCI's claim for a declaratory judgment, by which SCI sought to stop Loewen from bringing antitrust claims against SCI in any other jurisdiction. Following the Loewen board of directors' rejection of SCI's proposed hostile exchange offer, Loewen filed an antitrust action against SCI in the United States District Court for the Eastern District of New York. In his ruling in favor of Loewen, United States District Judge John D. Rainey found that SCI's Texas action was filed in anticipation of Loewen filing its antitrust suit in New York federal court. Judge Rainey also found that SCI sought to preempt Loewen's impending lawsuit in order to gain unfair advantage in choosing the forum for an antitrust action. In support of his opinion, Judge Rainey noted that SCI filed its lawsuit on the very same day that its board decided to make a proposed hostile exchange offer for Loewen's stock, and before that proposed offer was made public or even made known to Loewen's principals. Judge Rainey concluded that these compelling circumstances warranted dismissal of the Texas action in favor of allowing Loewen's New York antitrust action to proceed. Judge Rainey also dismissed SCI's securities law and tortious interference claims, ruling that they were "intimately connected to Loewen's antitrust claims" and could be heard in the New York action. The ruling of the Texas federal court clears the way for Loewen to proceed with its antitrust lawsuit in New York federal court challenging the proposed business combination of SCI and Loewen under Section 7 of the Clayton Act and alleging a conspiracy to monopolize between SCI and Equity Corporation International in violation of Section 1 of the Sherman Act. In October, Judge Frederic Block of the New York federal court denied a motion by SCI to dismiss Loewen's antitrust action in favor of the Texas case. The New York action has been stayed since that time pending resolution of the proceedings in the Texas federal court. Loewen stated that it now intends to vigorously pursue its antitrust lawsuit in New York federal court which alleges SCI's proposed acquisition of Loewen would, if successful, substantially lessen competition in the markets for locally-offered funeral and cemetery services, "pre-need" funeral services, and the funeral home and cemetery acquisition markets. The anti-competitive effects of SCI's hostile takeover proposal are also being reviewed by the FTC and have prompted regulatory scrutiny in numerous states, including New York, Florida, Hawaii, Texas, California, Pennsylvania, Tennessee, Washington, Oregon, Alaska, and North Carolina. In addition, the Canadian Competition Bureau is investigating the effects of the proposal under the Canadian Competition Act, and in that respect has made a request for information from the Company. ### -----END PRIVACY-ENHANCED MESSAGE-----