Company settles state antitrust lawsuit over Palm Mortuary purchase

By Steve Green (contact)

Wednesday, Nov. 25, 2009 | 11:43 a.m.

A Texas company has agreed to sell some of its Las Vegas funeral home operations to settle an antitrust lawsuit filed by the state over its purchase of Palm Mortuary Inc.

Service Corporation International (SCI) will sell Davis Funeral Home and Memorial Park, 6200 South Eastern Ave. (Sunset Road), the Nevada Attorney General's office said.

SCI must also sell the pre-paid funeral business from that home and the pre-paid business from Davis Funeral Home, 2127 West Charleston Blvd. (Rancho Road); to settle a complaint filed by the state so it can proceed with the purchase of Palm Mortuary.

"We are very pleased and ready to move forward to serve the families of Las Vegas," SCI spokeswoman Lisa Marshall said of the settlement.

"Cemeteries involve major purchases, typically at an extremely difficult time when consumers are most vulnerable," Nevada 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 state filed a lawsuit Tuesday over the takeover of Palm Mortuary, and the settlement of the suit was announced today.

State lawyers charged in the suit in federal court in Las Vegas that the deal as originally proposed would have violated the federal Clayton Act covering antitrust law and the Nevada Unfair Trade Practice Act because "defendant’s proposed acquisition will eliminate head-to-head competition in an already highly concentrated market, and will result in defendant having a monopoly or near-monopoly market share post-acquisition for cemetery services in the Las Vegas metropolitan area."

Such a monopoly situation, the state charged, would increase the likelihood of higher prices and a reduction in the quality of cemetery services.

Besides the funeral operations it's selling, the state said SCI also owns Thomas and Jones Funeral Home, 310 Foremaster Lane (Main St./Owens Ave.).

Palm is the largest provider of cemetery and funeral services in the Las Vegas area with cemetery services in six locations and funeral services in eight locations, the state said.

Palm's locations include one in Boulder City; downtown Las Vegas at 1325 N. Main St. (near Owens Ave.); near Henderson at 7600 S. Eastern Ave. (Warm Springs Road); in Henderson at 800 S. Boulder Highway (Lake Mead Parkway); in northwest Las Vegas at 6701 N. Jones Blvd. (Deer Springs Way); in Las Vegas at 1600 S. Jones Blvd. (Charleston Blvd.); and in northwest Las Vegas at 7400 W. Cheyenne Ave. (U.S. 95).

The state said the deal -- without the divestitures -- would have combined the No. 1 and No. 3 businesses in the Las Vegas industry, with Palm now enjoying a 60 percent share and SCI 16 percent of the market.

SCI, based in Houston, says it's the nation's largest provider of funeral, cremation and cemetery services. It reported revenue of $497 million in the third quarter of this year.