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1 (" 'i) ¡¡ç"J ~I ¡¡U., '.,'~i. ~: Yj. ~ l
(" 'i) ¡¡ç"J ~I ¡¡U., '.,'~i. ~: Yj. ~ l í. ~ ¡: '; ~ ~ ;.~1\ ~11 i., ¡¡ iiil '" cl l, ~\~ '1:"='" 11~?f-;l; ~ 'C & ~8~ .j l4 \\ I~ ;: A'~-~UNTED STATES OF AMERICAFEDERAL TRADE COMMISSIONOFFICE OF ADMINISTRATIVE LAW JUGESd?~6 6ó~oc-I '5"1t.7~1Respondent.)))) Docket No. 9327) (Public Version)))))In the Matter ofPolypore International, Inc.,a corporation,INTERVENOR HOLLINGSWORTH & VOSE COMPANY'SBRIEF ON REMEDIESAFFECTING ITS CONTRACTUAL RIGHTSCounsel for Hollngsworth & Vose Company:Kathryn K. CondeJonathan D. PerskyNUTTER MCCLENNEN & FISH LLP155 Seaport BoulevardWorld Trade Center WestBoston, MA 02210Tel: (617) 439-2420Fax: (617) 310-9420E-mail: kconde(lnutter.comjpersky(lnutter. com- -i i. INTRODUCTIONThe Complaint issued against Polypore International, Inc. ("Polypore") in this matteralleges that Polypore's acquisition of Microporous Holding Corporation is an ilegal mergerunder Clayton Act, Section 7 and Section 5 of the Federal Trade Commission Act and that italso constitutes an unlawful merger to monopoly. The Complaint alleges further that Polyporeengaged in a pattern of conduct - the merger being just one aspect - of thwarting competitionand monopolizing various battery separator markets. As part of this scheme, the governmentcontends that Polypore's subsidiary, Daramic, solidified an unlawful monopolization of severalpolyethylene ("PE") battery separator markets by inducing Intervenor, Hollngsworth & VoseCompany ("H&V"), to enter into a restrictive covenant contained in a Cross AgencyAgreement, "in order to prevent H&V from entering the PE separator market." (Compl.'47.). The essence of the government's claim against Daramic on the Cross Agency Agreementis that Daramic did not have a legitimate procompetitive purpose that could justify the restrainton H&V's competitive activities with respect to PE battery separators. (CC Post-Trial Brief at65-68.). It is the non-competition provision concerning the PE battery business - not theoverarching cross agency arrangement - that the government contends is an "unfair method ofcompetition." Notably, the Complaint did not name H&V as a Respondent and did not allegethat H& V engaged in unlawful conduct with respect to llH& V submits this brief pursuant to the Order on Motion to Leave to Intervene by N on-Party Hollingswort & Vose Company (the "Intervention Order") to address the propriety ofthe relief requested by Complaint Counsel to the extent the remedy improperly deprives H& Vof its property rights under the Cross Agency Agreement. Complaint Counsel proposes toremedy Polypore's alleged unfair method of competition with respect to the restriction on PE- 2 - battery separator competition by requiring Polypore to cease and desist from enforcing orimplementing and to nullfy both the non-competition restrictions relating to PE batteryseparators and the l L Fundamentalprinciples of due process and limitations on the remedial authority of the Federal TradeCommission prohibit an order nullfying the contractual rights of H& V which have not beenlitigated in this matter.II. CROSS AGENCY AGREEMENT

2 AND CLAIM AGAINST POL YPOREIn March 200
AND CLAIM AGAINST POL YPOREIn March 2001, Daramic and H&V entered the Cross Agency Agreement. DaramIcmakes PE battery separators for flooded lead acid batteries, while H&V makes absorptive glassmat ("AGM") battery separators for valve regulated lead acid ("VRLA") batteries. PEseparators cannot be used in VRLA batteries, and AGM battery separators cannot be used inflooded batteries. (H&V FOF '2.) The Agreement provided that l_l (H&V FOF , 3.)l(H&V FOF "4-5.) H&V engineers frequently participate in sales calls and assist customersin resolving manufacturing problems. (H&V FOF " 4- 5.) Since the cross-agencyrelationship would l- 3 - (H&V FOF , 6.) Section 4(b) provided that lL Section 4(a) provided that l(H&V FOF "7-8.)Complaint Counsel alleges that Daramic did not have a proper procompetitive purposeto enter the Cross Agency Agreement and that its sole purpose was to solidify its unlawfulmonopolization of several PE battery separator markets. Complaint Counsel does not contendthat H& V and Daramic were competitors, but that H& V was a potential competitor of Daramicin the PE battery separator business.l Specifically, Complaint Counsel has alleged with respectto Daramic's lack of a legitimate procompetitive purpose that:. "Daramic's principal purpose in contracting with H&V was to keep H&V out ofthe PE separator market." (CC Pre-Trial Br. at 32) (emphasis added)).. "(T)he evidence establishes that Daramic induced H & V to agree not to competein several markets - markets that have long been dominated by Daramic." (CCPost-Trial Br. at 67 (emphasis added)).. Upon learning that H& V was exploring the possibility of entering the PEbusiness, "(Un order to block this competitive threat, Daramic approached H& Vand proposed an 'allance." (Id. at 63 (emphasis added).Without a proper purpose relating to the expansion of PE battery sales, the governmentcontends that the restraint on H& V competing in PE battery separators was an unlawfuli H& V takes issue with the proposition that H& V had any plans to begin making or selling PE batteryseparators, as well as many other of Complaint Counsel's anegations. For example, H&V does not concede thatDaramic's motives were improper or that the non-compete in Section 4(b) was not a reaoonable ancilary restraint.However, those issues are outside of the scope of H&V's in1ervention.- 4- restraint. (CC Post-Trial Br. at 67-68.) This tribunal has not adjudicated whether l_L Moreover, in the context of H&V's response to third-partydiscovery requests from the government, H&V was informed that it was not being targeted inthis case, that its conduct was not at issue and that it was not considered the "bad actor" withrespect to the Cross Agency Agreement.Complaint Counsel's proposed remedy with respect to the Cross Agency Agreementextends beyond the claim actually litigated in this case - namely, whether the restriction oncompetition in PE battery separators was a reasonable ancilary restraint. In seeking relief,Complaint Counsel fails to distinguish between the restraints on competition in l_L Complaint Counsel propos

3 es that Respondent be required to do as
es that Respondent be required to do as follows:1. Within fifteen (15) days after the date this Order becomes final:(a) modif and amend the H& V Agreement in writing to terminate and declarenull and void, and (b) cease and desist from, directly or indirectly, or throughany corporate or other device, implementing or enforcing, the covenant not tocompete set forth in Section 4 of the H& V Agreement, and all related terms anddefinitions, as that covenant applies to Nort America and to actual and potentialcustomers within North America.2. Within thirty (30) days after the date this Order becomes final,fie with the Commission the written amendment to the H& V Agreement("Amendment") that complies with the requirements of Paragraph VLA.1(sicj .(CC Proposed Order VIlLA, at 26-27 (emphases added)).The Proposed Order would not only require Polypore to nullfy the entirety of Section 4by written amendment but would also, within 15 days, require that Polypore not "implement"Section 4. In other words, Polypore would be ordered to cease and desist from complyingL in Section 4(a).- 5 - If entered, the proposed remedy would necessarily and immediately effect H&V'scontract rights arising under Section 4(a).2 During the life of the Cross Agency Agreement,lFOF "911.) Daramic representatives have worked closely with H&V representatives indeveloping and maintaining these customer relationships and goodwil. (H&V FOF " 5,9.)lL (H&V FOF , 11.)H&V's valuable and valid contract rights would be negated by the proposed remedy.III. THE PROPOSED RELIEF VOIDING H&V'S CONTRACTUAL RIGHTSVIOLATES PROCEDURAL DUE PROCESSA. The Commssion May Not Adjudicate the Rights of a Non-PartyIt is black-letter law that a tribunal may not adjudicate the rights of a non-party.Richards v. Jefferson County, Alabama, 517 U.S. 793, 798 (1996) ("In Anglo-Americanjurisprudence. . . one is not bound by a judgment. . . in a litigation in which he is notdesignated as a party or to which he has not been made a party by service of process. "); ZenithRadio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 110 (1969) (similar); Hansberry v.Lee, 311 U.S. 32, 40 (1940) (similar); Lohr v. Conseco, Inc., Civ. No. 07-374, 2008 U.S.Dist. LEXIS 102344, at *15 (M.D.N.C. 2008) ("(J)udicial action that attempts to enforce a2 H& V submitted its proposed Findings of Fact relating to its right umer the contract in compliance with theIntervention Order. H&V cited record evidence to which it had public access or which itself possessed. Theevidence cited is by no means a complete record concerning H&V's rights or concerning the purpose, necessity,effect or validity of the restraints contained in the Cross Agency Agreement since H& V did not have rights ofdiscovery or presentation of evidence in this matter and does not have access to the complete record, which islargely in camera.- 6 - judgment against an absent party runs afoul of the due process requirements of the Fifth andFourteenth Amendments. "). Without adequate notice and a meaningful opportnity to beheard, a party cannot be deprived of a constitutionally

4 protected property interest.B. The Gove
protected property interest.B. The Government Did not Provide Notice to H&V of its Proposed Nullficationof H&V's Contract Rights and H&V was Without a Meaningful Opportnity tobe Heard.H& V's rights under its contract with Daramic constitute a legally protected propertyinterest. E.g., Lynch v. United States, 292 U.S. 571, 579 (1934). As such, the Due ProcessClause requires that H& V be provided adequate notice that its property interest is to beaffected and a meaningful opportnity to be heard. In re Kellogg Co., Dkt No. 8883, 1978FTC LEXIS 280, at *11-*12 (June 9, 1978); see Mathews v. Eldridge, 424 U.S. 319, 333(1976). In order to be adequate, notice must describe "the nature and scope of thecontemplated inquiry." Murphy Oil Corp. v. Fed. Power. Comm'n, 431 F.2d 805,813 (8thCir. 1970) (emphasis added); Shell Oil Co. v. Fed. Power Comm'n, 334 F.2d 1002, 1012 (3dCir. 1964). Such notice must suffciently identify of the allegations against a party. SouleGlass & Glazing Co. v. NLRB, 652 F.2d 1055, 1074 (1st Cir. 1981) ("Failure to clearly definethe issues and advise (a litigant) charged with a violation of the specific complaint he mustmeet and provide a full hearing on the issue presented is to deny due process of law. ").Applying the Supreme Court's balancing test set forth in Mathews v. Eldridge,3 meaningfulopportuty to be heard in this setting must mean the full rights of a party: an opportunity tosubmit evidence, object to evidence and to cross-examine. See, e.g., Murphy Oil Corp, 4313 Due process generally requires consideration of three distinct factors. First, the privateinterest that wil be affected by the official action; second, the risk of an erroneous deprivationof such interest through the procedures used, and the probable value, if any, of additional orsubstitute procedural safeguards; and finally, the Governmts interest, including the functioninvolved and the fiscal and administrative burdens that the additional or substitute proceduralrequirement would entail.Matthews v. Eldridge, 424 U.S. 319, 335 (1976).- 7 - F.2d at 813 ("(P)arties to a proceeding before an administrative agency are entitled to . . . anopportunity to be heard and present evidence. . . . A departure from (this) minimalrequirement() is a denial of procedural due process."); Doe v. U.S. Civ. Servo Comm'n, 483 F.Supp. 539, 579 (S.D.N.Y. 1980) ("The right to cross-examine witnesses applies toadministrative proceedings where an interest protected by the due process clause is at stake. ").In this case, Complaint Counsel did not provide H&V with notice that its contractualrights were at stake. The Complaint did not state a claim with respect to the lL H& V was not a named party and throughout discovery in thismatter it was informed by Complaint Counsel that it was not being targeted, that its motive wasnot at issue in the case and that H& V was not considered the "bad actor." H& V was withoutany of the discovery or trial rights of a party. Even today the record of the evidence submittedon the Cross Agency Agreement is largely in camera. Documents and testimon

5 y fromPolypore relating to the Cross Age
y fromPolypore relating to the Cross Agency Agreement are not reviewable by H& V. Much of thebriefing on the claim is also redacted. H&V never offered evidence with respect to thelegitimate purpose of the Agreement l L never cross-examinedkey witnesses from Polypore or put on full testimony of its own witnesses relating to the validpurpose of the Agreement and the reasonable necessity of the restrictions on competition llL The validity of the l_l were not at issue. It is violative of concepts of fundamental fairness for thegovernment to purport to have adjudicated H&V's contract rights under these circumstances.- 8 - iv. THE PROPOSED NULIFICATION OF H&V'S CONTRACTRIGHTS is BEYOND TH COMMISSION'S REMEDIAL AUTORITYRemedies imposed by the Commission must bear a "reasonable relation to the unlawfulpractices found to exist." FTC v. Natl Lead Co., 352 U.S. 419, 428 (1957); In re Ky.Household Goods Carriers Ass'n, 139 FTC 404,406 (2004) (Chappell, A.L.J.). Furthermore,the Commssion's "orders should go no further than is reasonably necessary to correct the eviland preserve the rights of competitors and public." FTC v. Royal Miling Co., 288 U.S. 212,217 (1933).Complaint Counsel has overreached in its request for a remedy. The remedy must fitthe claim. The claim that was tried was the legality of the non-competition restrictionsrelating to PE battery separators. Specifically the issues for proof as identified by the partiesincluded: (1) whether there was a legitimate purpose relating to PE battery separators; (2)whether the PE restriction was reasonably necessary to advance a legitimate procompetitivepurpose; and (3) whether there was there any anticompetitive effect on markets involving PEbattery separators. The validity of the non-competition restrictions contained in Section 4(a)lL were not tested. Any remedy necessarily must be limited tothe provisions of Section 4(b) ll. Requiring Respondent to"modify and amend the H& V Agreement in writing to declare null and void . . . the covenantnot to compete set forth in Section 4 of the Agreement" is not properly tailored to redress thealleged wrongdoing by Daramic. A reasonably related and complete remedy is available in theevent that this tribunal finds against Daramic on the validity of the PE battery separator non-compete. The relief requested by Complaint Counsel may be modified so that it is limited toSection 4(b) and wil not, as such, affect or determine H&V's contract rights.- 9 - V. CONCLUSIONFor the foregoing reasons, the Court should decline to adopt section VIII of ComplaintCounsel's Proposed Order, or, in the alternative, modify paragraph VIlLA. 1 of the ProposedOrder to strike the words "Section 4 of the H&V Agreement" and insert in their place "Section4(b) of the H& V Agreement."Dated: September 30,2009Respectfully submitted,HOLLINGSWORTH & VOSE COMPANYBy its attorneys,¡2.h- D ~.Kthryn K. Conde/ Jonathan D. PerskyNutter McClennen & Fish LLP155 Seaport BoulevardWorld Trade Center WestBoston, MA 02210Tel: (617) 439-2420Fax: (617) 310-9420E-mail: kconde(lnutter.comjpersky(lnutter. com-

6 10- CERTTFTCA TE OF SERVTCEI hereby cert
10- CERTTFTCA TE OF SERVTCEI hereby certify that on September 30, 2009, I filed via overnight delivery andelectronic mail delivery an original and two copies of the foregoing Intervenor Hollngsworth& Vose Company's Brief On Remedies Affecting Its Contractual Rights (Public Version) andthat the electronic copy is a true and correct copy of the paper original and that a paper copywith an original signature is being fied with:Donald S. Clark, SecretaryOffice of the SecretaryFederal Trade Commission600 Pennsylvania Avenue, NW, Rm. H-135Washington, DC 20580secretary~c. govI hereby certify that on September 30, 2009, I filed via overnight delivery andelectronic mail delivery two copies of the foregoing Intervenor Hollingsworth & V oseCompany's Brief On Remedies Affecting Its Contractual Rights (Public Version) with:The Honorable D. Michael ChappellAdministrative Law JudgeFederal Trade Commission600 Pennsylvania Avenue, NWWashington, DC 20580oalj~c. govI hereby certify that on September 30, 2009, I caused to be served via electronicdelivery and first-class mail delivery a copy of the foregoing Intervenor Hollingsworth & V oseCompany's Brief On Remedies Affecting Its Contractual Rights (Public Version) on:Wiliam L. Rickard, Jr., Esq.Eric D . Welsh, Esq.Parker, Poe, Adams & Bernstein, LLP401 South Tryon Street, Suite 3000Charlotte, North Carolina 28202willamrickard(lparkerpoe. comericwelsh(jparkerpoe. com1863347.1. '--_.-----J. Robert Robertson, Esq.Steven Dah, Esq.Bureau of CompetitionFederal Trade Commission600 Pennsylvania Avenue, NWWashington, DC 20580rrobertson~c. govsdahm~c. govL~ j)rathan D. PerskyI(- 11 - V.For the foregoing reasons, the Court should decline to adopt section VIII of Complaint Counsel's Proposed Order, or, in the alternative, modify paragraph VIlLA. 1 of
the Proposed Order to strike the words "Section 4 of the H&V Agreement" and insert in their place "Section 4(b) of the H& V Agreement." Dated: September 30,2009 Respectfully submitted, HOLLINGSWORTH & VOSE COMPANY By its attorneys, ¡2.h- D ~.Kthryn K. Conde
/ Jonathan D. Persky
Nutter McClennen & Fish LLP 155 Seaport Boulevard World Trade Center West Boston, MA 02210 Tel: (617) 439-2420 Fax: (617) 310-9420 E-mail: jpersky(lnutter. com -10­ CERTTFTCA TE OF SERVTCE
I hereby certify that on September 30, 2009, I filed via overnight delivery and electronic mail delivery an original and two copies of the foregoing Intervenor Hollngsworth & Vose Company's Brief On Remedies Affecting Its Contractual Rights (Public Version) and that the electronic copy is a true and correct copy of the paper original and that a paper copy with an original signature is being fied with: Donald S. Clark, Secretary Office of the Secretary Federal Trade Commission 600 Pennsylvania Avenue, NW, Rm. H-135 Washington, DC 20580 secretary~c. gov
I hereby certify that on September 30, 2009, I filed via overnight delivery and electronic mail delivery two copies of the foregoing Intervenor Hollingsworth & V ose Company's Brief On Remedies Affecting Its Contractual Rights (Public Versio

7 n) with: The Honorable D. Michael Chappe
n) with: The Honorable D. Michael Chappell
Administrative Law Judge Federal Trade Commission 600 Pennsylvania Avenue, NW Washington, DC 20580 oalj~c. gov
I hereby certify that on September 30, 2009, I caused to be served via electronic delivery and first-class mail delivery a copy of the foregoing Intervenor Hollingsworth & V ose Company's Brief On Remedies Affecting Its Contractual Rights (Public Version) on: Wiliam L. Rickard, Jr., Esq. J. Robert Robertson, Esq. Eric D . Welsh, Esq. Steven Dah, Esq. Parker, Poe, Adams & Bernstein, LLP Bureau of Competition 401 South Tryon Street, Suite 3000 Federal Trade Commission Charlotte, North Carolina 28202 600 Pennsylvania Avenue, NW willamrickard(lparkerpoe. com Washington, DC 20580 ericwelsh(jparkerpoe. com rrobertson~c. gov sdahm~c. gov
L~ j) I(rathan D. Persky
1863347.1 - 11 ­. '--_.----­ : Yj. ~ l í. ~ ¡: '; ~ ~ ;.~1\ ~
11 i., ¡¡ iiil '" cl l, ~\~ '1:"='" 11 (" 'i) ¡¡ç"J ~I ¡¡U., '.,'~i. ~
~?f-;l; ~ 'C & ~8~ .j l4 \\ I~ ;: A'~-~ d?~6 6ó~UNTED STATES OF AMERICA oc-I 'FEDERAL TRADE COMMISSION 5"1t.7~1OFFICE OF ADMINISTRATIVE LAW JUGES ) In the Matter of ) ) Polypore International, Inc., ) Docket No. 9327 a corporation, ) (Public Version)
)
Respondent. )
) ) INTERVENOR HOLLINGSWORTH & VOSE COMPANY'S
BRIEF ON REMEDIES
AFFECTING ITS CONTRACTUAL RIGHTS Counsel for Hollngsworth & Vose Company: Kathryn K. Conde Jonathan D. Persky NUTTER MCCLENNEN & FISH LLP 155 Seaport Boulevard World Trade Center West Boston, MA 02210 Tel: (617) 439-2420 Fax: (617) 310-9420 E-mail: jpersky(lnutter. com - -i l iv.RIGHTS is BEYOND TH COMMISSION'S REMEDIAL AUTORITY Remedies imposed by the Commission must bear a "reasonable relation to the unlawful practices found to exist." FTC v. Natl Lead Co., 352 U.S. 419, 428 (1957); In re Ky. Household Goods Carriers Ass'n, 139 FTC 404,406 (2004) (Chappell, A.L.J.). Furthermore, the Commssion's "orders should go no further than is reasonably necessary to correct the evil and preserve the rights of competitors and public." FTC v. Royal Miling Co., 288 U.S. 212, 217 (1933). Complaint Counsel has overreached in its request for a remedy. The remedy must fit the claim. The claim that was tried was the legality of the non-competition restrictions relating to PE battery separators. Specifically the issues for proof as identified by the parties included: (1) whether there was a legitimate purpose relating to PE battery separators; (2) whether the PE restriction was reasonably necessary to advance a legitimate procompetitive purpose; and (3) whether there was there any anticompetitive effect on markets involving PE battery separators. The validity of the non-competition restrictions contained in Section 4(a) L were not tested. Any remedy necessarily must be limited to the provisions of Section 4(b) l
l."modify and amend the H& V Agreement in writing to declare null and void . . . the covenant not to compete set forth in Section 4 of the Agreement" is not properly tailored to redress the alleged wrongdoing by Daramic. A reaso

8 nably related and complete remedy is ava
nably related and complete remedy is available in the event that this tribunal finds against Daramic on the validity of the PE battery separator non­compete. The relief requested by Complaint Counsel may be modified so that it is limited to Section 4(b) and wil not, as such, affect or determine H&V's contract rights. - 9 ­ F.2d at 813 ("(P)arties to a proceeding before an administrative agency are entitled to . . . an opportunity to be heard and present evidence. . . . A departure from (this) minimal requirement() is a denial of
procedural due process."); Doe v. U.S. Civ. Servo Comm'n, 483 F. Supp. 539, 579 (S.D.N.Y. 1980) ("The right to cross-examine witnesses applies to administrative proceedings where an interest protected by the due process clause is at stake. "). In this case, Complaint Counsel did not provide H&V with notice that its contractual rights were at stake. The Complaint did not state a claim with respect to the l L H& V was not a named party and throughout discovery in this matter it was informed by Complaint Counsel that it was not being targeted, that its motive was not at issue in the case and that H& V was not considered the "bad actor." H& V was without any of the discovery or trial rights of a party. Even today the record of the evidence submitted on the Cross Agency Agreement is largely in camera. Documents and testimony from Polypore relating to the Cross Agency Agreement are not reviewable by H& V. Much of the briefing on the claim is also redacted. H&V never offered evidence with respect to the legitimate purpose of the Agreement l L never cross-examined key witnesses from Polypore or put on full testimony of its own witnesses relating to the valid purpose of the Agreement and the reasonable necessity of the restrictions on competition ll
L The validity of the l _l were not at issue. It is violative of concepts of fundamental fairness for the
government to purport to have adjudicated H&V's contract rights under these circumstances. - 8 ­ judgment against an absent party runs afoul of the due process requirements of the Fifth and Fourteenth Amendments. "). Without adequate notice and a meaningful opportnity to be heard, a party cannot be deprived of a constitutionally protected property interest. B.of H&V's Contract Rights and H&V was Without a Meaningful Opportnity to be Heard. H& V's rights under its contract with Daramic constitute a legally protected property interest. E.g., Lynch v. United States, 292 U.S. 571, 579 (1934). As such, the Due Process Clause requires that H& V be provided adequate notice that its property interest is to be affected and a meaningful opportnity to be heard. In re Kellogg Co., Dkt No. 8883, 1978 FTC LEXIS 280, at *11-*12 (June 9, 1978); see Mathews v. Eldridge, 424 U.S. 319, 333 (1976). In order to be adequate, notice must describe "the nature and scope of the contemplated inquiry." Murphy Oil Corp. v. Fed. Power. Comm'n, 431 F.2d 805,813 (8th Cir. 1970) (emphasis added); Shell Oil Co. v. Fed. Power Comm'n, 334 F.2d 1002, 1012 (3d Cir. 1964). Such notice must su

9 ffciently identify of the allegations ag
ffciently identify of the allegations against a party. Soule Glass & Glazing Co. v. NLRB, 652 F.2d 1055, 1074 (1st Cir. 1981) ("Failure to clearly define the issues and advise (a litigant) charged with a violation of the specific complaint he must meet and provide a full hearing on the issue presented is to deny due process of law. "). Applying the Supreme Court's balancing test set forth in Mathews v. Eldridge,3 meaningful opportuty to be heard in this setting must mean the full rights of a party: an opportunity to submit evidence, object to evidence and to cross-examine. See, e.g., Murphy Oil Corp, 431 3 Due process generally requires consideration of three distinct factors. First, the private interest that wil be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Governmts interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail. Matthews v. Eldridge, 424 U.S. 319, 335 (1976). - 7 ­ If entered, the proposed remedy would necessarily and immediately effect H&V's contract rights arising under Section 4(a).2 During the life of
the Cross Agency Agreement, l FOF "911.) Daramic representatives have worked closely with H&V representatives in developing and maintaining these customer relationships and goodwil. (H&V FOF " 5,9.) l L (H&V FOF , 11.) H&V's valuable and valid contract rights would be negated by the proposed remedy. III.VIOLATES PROCEDURAL DUE PROCESS A.It is black-letter law that a tribunal may not adjudicate the rights of a non-party. Richards v. Jefferson County, Alabama, 517 U.S. 793, 798 (1996) ("In Anglo-American jurisprudence. . . one is not bound by a judgment. . . in a litigation in which he is not designated as a party or to which he has not been made a party by service of process. "); Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 110 (1969) (similar); Hansberry v. Lee, 311 U.S. 32, 40 (1940) (similar); Lohr v. Conseco, Inc., Civ. No. 07-374, 2008 U.S. Dist. LEXIS 102344, at *15 (M.D.N.C. 2008) ("(J)udicial action that attempts to enforce a 2 H& V submitted its proposed Findings of Fact relating to its right umer the contract in compliance with the Intervention Order. H&V cited record evidence to which it had public access or which itself possessed. The evidence cited is by no means a complete record concerning H&V's rights or concerning the purpose, necessity, effect or validity of the restraints contained in the Cross Agency Agreement since H& V did not have rights of discovery or presentation of evidence in this matter and does not have access to the complete record, which is largely in camera. - 6 ­ restraint. (CC Post-Trial Br. at 67-68.) This tribunal has not adjudicated whether l_
L Moreover, in the context of H&V's response to third-party discovery requests from the government, H&V was informed that it was not being targ

10 eted in this case, that its conduct was
eted in this case, that its conduct was not at issue and that it was not considered the "bad actor" with respect to the Cross Agency Agreement. Complaint Counsel's proposed remedy with respect to the Cross Agency Agreement extends beyond the claim actually litigated in this case - namely, whether the restriction on competition in PE battery separators was a reasonable ancilary restraint. In seeking relief, Complaint Counsel fails to distinguish between the restraints on competition in l_
L Complaint Counsel proposes that Respondent be required to do as follows: 1.(a)null and void, and (b) cease and desist from, directly or indirectly, or through any corporate or other device, implementing or enforcing, the covenant not to compete set forth in Section 4 of the H& V Agreement, and all related terms and definitions, as that covenant applies to Nort America and to actual and potential customers within North America. 2.fie with the Commission the written amendment to the H& V Agreement ("Amendment") that complies with the requirements of Paragraph VLA.1(sicj . (CC Proposed Order VIlLA, at 26-27 (emphases added)). The Proposed Order would not only require Polypore to nullfy the entirety of Section 4 by written amendment but would also, within 15 days, require that Polypore not "implement" Section 4. In other words, Polypore would be ordered to cease and desist from complying L in Section 4(a). - 5 ­ (H&V FOF , 6.) Section 4(b) provided that l L Section 4(a) provided that l (H&V FOF "7-8.) Complaint Counsel alleges that Daramic did not have a proper procompetitive purpose to enter the Cross Agency Agreement and that its sole purpose was to solidify its unlawful monopolization of several PE battery separator markets. Complaint Counsel does not contend that H& V and Daramic were competitors, but that H& V was a potential competitor of Daramic in the PE battery separator business.l Specifically, Complaint Counsel has alleged with respect to Daramic's lack of a legitimate procompetitive purpose that: . "Daramic's principal purpose in contracting with H&V was to keep H&V out of
the PE separator market." (CC Pre-Trial Br. at 32) (emphasis added)). . "(T)he evidence establishes that Daramic induced H & V to agree not to compete
in several markets - markets that have long been dominated by Daramic." (CC Post-Trial Br. at 67 (emphasis added)). . Upon learning that H& V was exploring the possibility of entering the PE
business, "(Un order to block this competitive threat, Daramic approached H& V and proposed an 'allance." (Id. at 63 (emphasis added). Without a proper purpose relating to the expansion of PE battery sales, the government contends that the restraint on H& V competing in PE battery separators was an unlawful i H& V takes issue with the proposition that H& V had any plans to begin making or selling PE battery separators, as well as many other of Complaint Counsel's anegations. For example, H&V does not concede that Daramic's motives were improper or that the non-compete in Section 4(b) was not a reaoonable ancilary restra

11 int. However, those issues are outside o
int. However, those issues are outside of the scope of H&V's in1ervention. -4­ battery separator competition by requiring Polypore to cease and desist from enforcing or implementing and to nullfy both the non-competition restrictions relating to PE battery separators and the l L Fundamental principles of due process and limitations on the remedial authority of the Federal Trade Commission prohibit an order nullfying the contractual rights of H& V which have not been litigated in this matter. II.In March 2001, Daramic and H&V entered the Cross Agency Agreement. DaramIc makes PE battery separators for flooded lead acid batteries, while H&V makes absorptive glass mat ("AGM") battery separators for valve regulated lead acid ("VRLA") batteries. PE separators cannot be used in VRLA batteries, and AGM battery separators cannot be used in flooded batteries. (H&V FOF '2.) The Agreement provided that l _l (H&V FOF , 3.)
l (H&V FOF "4-5.) H&V engineers frequently participate in sales calls and assist customers in resolving manufacturing problems. (H&V FOF " 4- 5.) Since the cross-agency relationship would l - 3 ­ i.The Complaint issued against Polypore International, Inc. ("Polypore") in this matter alleges that Polypore's acquisition of Microporous Holding Corporation is an ilegal merger under Clayton Act, Section 7 and Section 5 of the Federal Trade Commission Act and that it also constitutes an unlawful merger to monopoly. The Complaint alleges further that Polypore engaged in a pattern of conduct - the merger being just one aspect - of thwarting competition
and monopolizing various battery separator markets. As part of this scheme, the government contends that Polypore's subsidiary, Daramic, solidified an unlawful monopolization of several polyethylene ("PE") battery separator markets by inducing Intervenor, Hollngsworth & Vose Company ("H&V"), to enter into a restrictive covenant contained in a Cross Agency Agreement, "in order to prevent H&V from entering the PE separator market." (Compl.' 47.). The essence of the government's claim against Daramic on the Cross Agency Agreement is that Daramic did not have a legitimate procompetitive purpose that could justify the restraint on H&V's competitive activities with respect to PE battery separators. (CC Post-Trial Brief at 65-68.). It is the non-competition provision concerning the PE battery business - not the overarching cross agency arrangement - that the government contends is an "unfair method of competition." Notably, the Complaint did not name H&V as a Respondent and did not allege that H& V engaged in unlawful conduct with respect to l l H& V submits this brief pursuant to the Order on Motion to Leave to Intervene by N on-Party Hollingswort & Vose Company (the "Intervention Order") to address the propriety of the relief requested by Complaint Counsel to the extent the remedy improperly deprives H& V of its property rights under the Cross Agency Agreement. Complaint Counsel proposes to remedy Polypore's alleged unfair method of competition with respect to the restriction on PE