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Nov. 25, 2009
Copyright © Las Vegas Review-Journal

State attorney general suing over planned purchase of Palm Mortuary

By JOHN G. EDWARDS
LAS VEGAS REVIEW-JOURNAL

The Nevada attorney general’s office and Federal Trade Commission Wednesday said they reached an antitrust agreement over Service Corporation International’s planned acquisition of Palm Mortuary Inc., the dominant funeral and cemetery service company in the Las Vegas area.

SCI seeks to buy Palm’s six cemeteries and eight funeral homes in the Las Vegas area, according to a lawsuit filed Wednesday by the attorney general’s office.

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    • The nation’s largest cemetery operator with $2.1 billion ins sales, SCI has agreed to sell Davis Funeral Home and Memorial Park to an FTC-approved buyer in order to acquire Palm Mortuary.

    Without the sale of the funeral home and cemetery, the merger would have reduced the number of competitors in the Las Vegas area from three to two. SCI would have controlled 76 percent of the market with only one significant competitor, Bunkers Mortuaries, Cemeteries and Crematory of Las Vegas, according to the attorney general’s office.

    The federal agency said the transaction would have increased the likelihood that SCI could raise prices unilaterally or through interaction with Bunkers.

    “Cemeteries involve major purchases at an extremely difficult time when consumers are most vulnerable,” Attorney General Catherine Cortez Masto said in a statement. “It is critical to preserve competition in the cemetery market for local Las Vegas families.”

    The lawsuit said the merger, unless modified, “will eliminate head-to-head competition in an already highly concentrated market and will result in (SCI) having a monopoly or near-monopoly market share.”

    The anti-trust review “was certainly not a hostile process at all,” said attorney general spokeswoman Edie Cartwright. “This was a formal investigation conducted by our office,” said senior deputy attorney general Brian Armstrong.

    “We definitely worked collaboratively with them on this agreement,” said SCI spokeswoman Lisa Marshall. “It’s in everybody’s interest to do the right thing for them.”

    Palm Mortuary did not return a call for comment. Terms of the acquisition were not disclosed.

    Funeral Service Insider first disclosed the agreement to merge Palm and SCI three months ago.

    The acquisition would be the final chapter for Palm Mortuary as an independent, family-owned company.

    Gene and Anna Parks established Palm Mortuary in 1926 at the site now occupied by the Golden Nugget. Anna Parks was the first woman in Nevada to become a licensed funeral director.

    The Parkses rented a house in Boulder City in 1933, because the federal government would not start construction of Hoover Dam until there was a funeral home nearby.

    The Parkses sold to two businessmen in 1946. The location was moved 1325 N. Main St., the location of Palm’s headquarters today. Charles Knauss took over Palm in 1959 and expanded the funeral home operation to locations around the valley.

    Ken Knauss, the son of Charles Knauss, is president of Palm Mortuary. Rita Burton is secretary and treasurer.

    The attorney general’s office on Tuesday filed the lawsuit and the proposed agreement, which awaits approval by U.S. District Judge Larry Hicks.

     

    Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420.

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    Robert wrote on November 25, 2009 03:36 PM: Rodman makes a good point. How about the monopoly that NV Energy, Embarq, Cox, Republic Service. Has on the people of the Las Vegas Valley. They are the only companies available to deal with and they have been allowed to buy out or squash any other company that has come to town and tried to compete. I guess all does depend on those campaign contributions and who gets them to turn there heads and look the other way. How about those Miss Attorney General. Why aren't you suing them ??


    Rodman wrote on November 25, 2009 03:03 PM: If this broad wants to sue people for having a monopoly why not start with Nevada Power, Enery or whoever they are??? Suing a funeral home that can only get you once is nothing compared to a power company that sticks it to you month after month after month.


    Chet wrote on November 25, 2009 02:50 PM: Just what this town needs more BIG Corporations (rolls eyes) Thank you Nevada Attorney General Catherine Cortez Masto for looking out for the small citizens of this community. Maybe next you can start on some of the casinos and force them to sell off some of there ownership on the strip. BIG Corporations are destroying this country and even this community here, they don't give 10 cents about this community or America, all they care about is feeding there bottom line to all the shareholders, CEO's & CFO's. Bring back the little men who built this great country who actually care about the environment and the people of the UNITED STATES OF AMERICA. Let the control of the USA be in the hands of the people, not the BIG Corporations.


    Suffering Homeowner wrote on November 25, 2009 02:35 PM:

    Shouldn't that be "stiff competition" ?


    Too_much_Cortez-Masto wrote on November 25, 2009 02:01 PM: If Cortez-Masto is getting involved, there has to be a political angle to it.


    CHAMI wrote on November 25, 2009 01:47 PM: Whatelse people do not sue anyone for?


    Don K wrote on November 25, 2009 01:45 PM: points go to TimeRanger as having the only thoughtful comment here!

    Here is the 2008 annual report for SCI...lot of litigation. They have 3 funeral homes and 1 cemetery in Nevada.

    Who Cares? Those that don't want to be held hostage to a single publicly traded corporation (who is a subject of securities litigation), when their grandma dies.


    Who Cares wrote on November 25, 2009 01:13 PM: Sounds like we need to shed her from office. Sounds anti-business to me. I bet she would sue the SEIU if they wanted the acquire or merge all the state unions together. Mmmmmm


    TimeRanger wrote on November 25, 2009 01:13 PM: Mermaid - if the sale were allowed to go through, SCI could pretty much charge whatever they wanted to the survivors, due to a lack of Competition. It would be like having Smith's as the only grocery store in town.


    Jimmy Jay wrote on November 25, 2009 01:07 PM: I guess SCI forgot to make their "campaign contribution" in a timely manner. Nothing a little extra cash can't solve, unmarked and non-sequential, of course.


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