Amicus Curiae Brief — City of New York v. United States

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SUPREME eu ee eds

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_CouEn, Sapiro, Bercer, Pousier

No. 1121,

-|° CITY OF NEW YorK,

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a Appellant,

ee :

‘UNITED STATES OF AMERICA, AUTOMOBILE MANU.

FACTURERS ASSOCIATION, INC., GENERAL MO. °

CHRYSLER CORPORATION, AND AMERICAN MO.

TORS CORPORATION, ak ; _

| A ppellees,

On Appeal From the United States District Court for the

Central District of- California,

_ BRIEF OF AMICI CURIAE,

COUNTY OF LACKAWANNA, ET AL,

IN SUPPORT OF JURISDICTIONAL STATEMENT.

Davip Berczr, »

Herserr B. NEWBERG, ©

H. Lavpre Montacur, Jr.,

Howarp L, Scuampetan, o

: Awan M. Lerner,

. Attorneys for Amici Curiae.

AND CoHEn, ‘

Twenty-Second Floor,

Philadelphia Saving Fund Building,

Philadelphia, Pa. ‘19107 aie :

Of Counsel

- International, 711 So. sorh St., Phila., Pa. 19143—Tei, SA 7-8711 Area Code 215

“

.

&

IN THE

Supreme Court of the United States

OcToBER Ter, 1969.

No. 1121.

CITY OF NEW-YORK, .

ites Appellant,

\ U.

|

UNITED STATES OF AMERICA, AUTOMOBILE

MANUFACTURERS ASSOCIATION, INC., GEN-—

' ERAL. MOTORS CORPORATION, FORD MOTOR

. COMPANY, CHRYSLER CORPORATION, AND

AMERICAN MOTORS CORPORATION, .

Appellees.

.

On AppreaL From THE Unirep States District Courr

FOR THE CENTRAL District oF CALIFORNIA

BRIEF OF AMICI CURIAE, COUNTY OF

LACKAWANNA, ET AL. IN SUPPORT

| OF JURISDICTIONAL STATEMENT.

The counties of Lackawanna and Luzerne, Pennsy]-

vania, the‘City of Buffalo, New York and the County of

_ Erie, New York file this brief as Aynici Curiae pursuant to

Rule 42 of the Rules of the Supreme Court of fhe United

States. -!

“SN

; a . A i » L be

_ INTERESTS OF AMICI CURIAE

or ;

Each of Ahe 4 micit Curiae herein (hereinafter collec.

tively referred fo as ‘‘Amici’’) are a political subdivision

as identified below: as

County of Luzerne, ‘Pennsylvania |

‘5 County of* Lackawanna, Pennsylvania

~ City of Buffalo, New York. .

| County of Krie, New York cee

and as such, share common interests with Appellant, City

of New York. - In addition, each of the Amici Curiae are-

plaintiffs in a private treble damage action! against the.

lefendants and ¢0-conspirators named in United States of

-lmerica v, Automobile Manufacturers Association, Inc.,

Civ. Action No. 69-75 (C. D. Cal.), plaintiffs being repre-

sentatives of a class pursuant to F. RB. C. P. 23, the class

being defined as: ; ye

| §overnments, .

states and public bodies in the United States, their citi-

zens and members of the public whom they’serve . *.»

sare municipalities, county and local

Accordingly, if the defendants have committed the acts al-

leged by the United States and by Amici and the members

of the class they re resent, Amici as well as Appellant have

suffered substantial injury to their ‘business and property. -

Indeed, it is the interests of Amici and others similarly

situated that the relief requested by the Federal] Govern-

ment Action was designed to protect. Cascade Natural Gas

‘Corp. v. El Paso Natural Gas Co., 386 U.S. 129, 135, 17 L.

Ed. 2d 814, 819, 87 8. Ct. 939 (1967). See Association of

1. County of Lackawanna, Pennsylvania, ct al. v. Automobile

Manufacturers Association, Inc., et al., Ciy. Action No. 70-398 (E. D.- *

re)

‘

3

‘"* Data Processing Service Organizations, Inc. v. Camp, U.S.

Supreme Court Docket No. 85 (Opinion March 3, 1970) ;

Barlow v. Collins, U. §. Supreme Court Docket No. 249

(Opinion March 3, 1970). For these’ reasons Amici are

vitally interested in and will be greatly affected by the out-

come of this appeal. sti |

I.

ARGUMENT.

__

‘The Proposed Consent Decree Without Any Admission of

3 Liability by the Defendants Was Improperly Entered

in That It Adversely Affects the Interests of State and

Local Governments and Their Citizens and Does N ot

-Rectify the Deleterious Effects Caused by Defendants’

_ Acts.

“The consent deéree accepfed and entered by the District

Court did not contain a clause giving the decree prima facie

effect:in private treble damage actions pursuant to §d(a),

Clayton Act. The Federal Rules of Civil Brocedure as well

'as_basie jurisdictional statutes provide the District Court

with power to refuse to approve a consent decree absent the

§)(a) clause.” Res f

Potential recoveries in private treble-damage actions

are the nyost effective deterrent of violations of the antitrust

laws. Th exercising their diseretion whether or not to de-

cept nolo pleas or whether or not to approve stipulated con-

sent judgments, courts should: consider whether or not prima

facie evidence will be available to plaintiffs in later private

civil actions. See Nolo Pleas in Antitrust Cases, 79 Harv.

_ L, Rev. 1475, 1481-82 (1966). ‘«In.cases of serious violations

2. “It is certainly within the power of the court to reject a

proposed decree even when both sides consent.” Dabney, Consent

Decrees Without Consent, 63 Col. L. Rev. 1053, 1064 (1963).

.

_ Where substantia] private injury has resulted, the policy of.

Section 5 should override any ‘special considerations that

would deny the evidentiary aid to injured parties and would

permit defendants to avoid private liability.’’ Section 5 of

the Clayton Act and the Nolo Contendere -Plea, 75 Yave L.

. J. 845, 867-68 (1966). By the ‘proviso excluding consent —

~ decrees from the operation of the prima facie effect of

fovernment proceedings, Congress did not intend to open

_ the door to any willing defendant to escape from obligations .

for restitution to ifijured parties arising from its wrong-

doings, ‘ Sei aie

‘Congress made convictions in contested cases and.con-

Victions after guilty pleas -binding in later suits; to

argue that Congress meant, at the same time, to allow .

‘ magic Latin words is to make a mockery of the policy

supporting section D(a). And since the mair purpose A

of that policy was to aid plaintiffs in treble damage

suits, it seems that the effect on such suits should be

considered when the court, by accepting or rejecting

nolo, determines whether the defendant will be excepted

- from section D(a).”’” Nolo Pleas, supra, 79 Harv. L,

Rey. at 1483, gs"

‘There are compelling reasons why the consent decree °

in this case should have provided for its prima facie effect

in subsequent actions: .

at . ° ‘ e t “ Pea,

a. The Subject Matter Is Vital to Life and Well Being.

This Court may take judicial notice of the immediate

grave threat-of air pollution Yo our country. Where the

vital element necessary to life, the courts should scrutinize

the consent deeree in light of its overwhelming importance

* j . : -

ry]

to public interest and welfare. In U.S. ¢. Toledo Milk

Distributors Association, 1954 Trade Reg., 1 67,918 (N. D.

Ohio 1954), the: District Court refused to accept pleas of... —

nolo contendere ina criminal antitrust action.on the ground

that the complaint contained allegations of price-fixing for

sales of a vital commodity, milk.

b. The Public Interest Can Be Served Adequately Only : ‘

by a Consent Decree With a Prima Facie Effect or

by a Trial on the Merits. .

The consent. decree in its present form enjoins the de-

fendants from continuing the acts alleged to be in violation

of the Sherman Act. The Court below reasoned that the

deeree brings immiediate assured results and avoids a tre- .

ie mendous.expenditure of taxpayer’s money, (App. A, 5a,

‘Ma-l5a). These stated benefits of the decree are illusory.

There is no avoidance of ‘‘a tremendous expenditure of

taxpayers’ money. ’? The Government already made a

vast investment in its grand jury inves tion.’ A Govern-

ment trial would only-harvest the fruits of that investment.

Furthermore, the savings to the Federal Government in not 4

conducting a trial will be surpassed greatly by the ex-

penditures whic). will necessarily be made by state and

local governments in enforcing their. rights and the rights

of their citizens. Instead of taxpayers’ money being ex-

pended by the Justice Department in the prosecution of one

trial beneficial to all subsequent related actions, those same ,

_ taxpayers will be expending a greater amount of money at

the state and loeal government. leve] in the prosecution of

a myriad of treble damage actions scattered throughdut

‘the various judicial districts. Paap fa

- The alleged benefits from the consent decree of grant-

ing the Justice Department the immediate assured results

it desired is also illusory. ‘That’ same result would most

G6

probably be reached by a Government request for a pre-

liminary injunetion.* Likewise, the result would most likely

Come about in this. case due to the almost unprecedented

amount of publie and governmental pressures placed upon

the defendants and others to clean. up and preserve our

atmosphere. This pressure is caused by today’s coneern —

of the lethal problem of environmental pollution.

Although the consent decree may cause defendants to

cease their past activities, it ‘contributes nothing toward

‘rectifying the harm which their alleged acts have caused.

In New Jersey Wood Finishing Company v.-Minnesota -

Wining & Manuacturing Company, 381 U.S. 311, 318, 85

S. Ct.1473, 14 L. Ed. 2d 405, 411 (1965), this Court empha-

sized that ‘Congress has expressed its belief that private

antitrust litigation is one of the surest weapons for. effec-

tive inforcement of the antitrust laws.’’ In discussing the

impact of § 5(a), the Court stated: —

ss in framing ¢5(a) Congress focused on the nar-.

- row issue of the use by private parties of judgments

or decrees as prima facie evidence, This ‘Was recog-

nized in Emich Motors Corp. v.. General Motors Corp.,

340 U.S. 558.95. L. ed. 534, 71 S..Ct. 408. (1951), where

Wwe stated that the purpose of § 5(a) was ‘to minimize

the burdens of litigation for injured private suitors by

making available to tliem all matters previously estab- —

lished hy the Government in antitrust actions’ and to:

permit them ‘as ‘large an. advantage as tho estoppel

doctrine would afford had the Government brought

suit,’ Id., at 068,.95 LL, ed. at 544.” , 381 U.S. at 317.

‘It is clear that with respect to the present antitrust

violations charged against the defendants, the cireum-

3. At the very least, it appears that the Government should at-

tempt to obtain preliminary relief before it enters into a consent de-

cree, especially where prompt relief is a major factor in its decision

to obtain a consent decree, i sy.

}*-— Sime

. ys .

S.

_Stanées are proper to blend the effectiveness of private

antitrust litigation with the skill and resources of the Jus-

tice Department in redressing completely the deplorable

conditions to which the defendants have contributed.

. . Apart from the importance of the issues involved and . |

_. their direct impact throughout the United States, there is

an additional reason that: this Court should review. the

the Expediting Act of February 11, 190 ,15 U.S. C. Sec? 29.

Absent review by this Court, appellant has no other forum

to which to turn for réview of what it cohisiders to be

_ erroneous rulings by the District’ Court.

“*(I)n antitrust cases . . . our practice, particularly

in cases of direct appeal from the decree of a single

judge, is to examine the District Court’s action closely

to satisfy ‘ourselves that the relief is effective to re- _

dress the antitrust. Violations proved. ‘The relief

granted by a trial court in an antitrust case and brought

here on direct appeal, thus. by-passing the usual ap-

pellate review, has always had the most careful seru-

tiny of this Court.’ 5. International Boxing Club

v. U.S., 358 U.S. 242, 253, 3 L. Ed. 2d 270, 278, 79.

S. Ot. 245 (1959) |...

.““(T)he suit has been a futile exercise if the Govern-

ment proves 4 violation but fails to secure a remedy -

adequate to redress it. . .

“‘Our practice reflects a situation created by the

congressional authorization, under Sec, 2 of the Ex-

pediting Act, of a direct appeal to this Court from

the judgment of relief fashioned by a single judge.

Congress has deliberately taken away the shield of

eo

S

intermediate appellate review by a Court of Appeals,

and left with us alone the responsibility of affording

the parties a review of his determination. This eir-

cumstance imposes a special burden: upon us, for, as

Mr. Justice Roberts said for the Court, ‘. . . it is

unthinkable that Congress has entrusted the enforce-

ment of a statute of such far-reaching importance to

the judgment of a single judge, without review of.

the relief granted or denied by him.’ Hartford-Em-

pire Company v. U. S., 324 1. S.°570, 571, 89 L. Ed.

1198, 1200, 65 S. Ct. 815 (1945).””. U. §, vy. DuPont

De Nemours & Company, 366 U. S. 316, 323-35, 81-8.

Ct. 1243, 6 L. Ed. 2d 318, 323-24 (1961), :

‘

III. CONCLUSION.

This Court is called upon to determine questions most

Significant to the full scheme. of enforcement of the anti- -

trust laws. The particular case in which these issues -

are raised will have meaningful and lasting effects through-

out the United States. Accordingly, amici curiae respect-

fully urge that this Court review whether tlie district court

adequately considered whether the gonsent decree in jts’

of Appellant, amici curiae and others similarly situated

were adequately protected in the proceedings - below.

Respectf ully submitted,

‘ Davin BeErcerr, -

Hersert B, N EWBERG,

H. Lappre Montacug; Jr.,

Howarp L, ScHAMBELAN,

Aan M, Lerner, .

. Twenty-Second Floor,

Philadelphia Saving Fund Bldg.,

Philadelphia, Pa. 19107,

_ Attorneys for Amici Curiae.

_Conen, Suapio, BErcer,

PoLIsHER anp Coney,

Twenty-Second Floor,

Philadelphia Saving Fund Building,

Philadelphia, Pa. 19107,

Of Counsel... ~