356 U.S. 677 (1958), 51, United States v. Procter & Gamble Co.

Docket Nº:No. 51
Citation:356 U.S. 677, 78 S.Ct. 983, 2 L.Ed.2d 1077
Party Name:United States v. Procter & Gamble Co.
Case Date:June 02, 1958
Court:United States Supreme Court
 
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Page 677

356 U.S. 677 (1958)

78 S.Ct. 983, 2 L.Ed.2d 1077

United States

v.

Procter & Gamble Co.

No. 51

United States Supreme Court

June 2, 1958

Argued April 28, 1958

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

Syllabus

Following a federal grand jury investigation of possible criminal violations of the Sherman Act, in which no indictment was returned, the Government brought a civil suit under § 4 of the Act to enjoin alleged violations of §§ 1 and 2 by appellees. The Government was using the grand jury transcript to prepare the civil case for trial, and appellees moved for discovery and production of the transcript, in order that they might have the same privilege. The District Court ruled that appellees had shown "good cause," as required by Rule 34 of the Federal Rules of Civil Procedure, and granted the motion. Being unwilling to produce the transcript, the Government moved that the order be amended to provide that, if production of the transcript were not made, the Court would dismiss the complaint. The order was so amended; the Government persisted in its refusal to produce the transcript; and the District Court dismissed the complaint. The Government appealed to this Court.

Held:

1. The rule that a plaintiff who has voluntarily dismissed his complaint may not appeal from the order of dismissal has no application here, since the Government's motion to amend the original order was designed only to expedite review of that order. Pp. 680-681.

2. Appellees failed to show "good cause," as required by Rule 34, for the wholesale discovery and production of a transcript of the grand jury's proceedings, which, pursuant to a long established policy, must normally be kept secret, when they did not show that the criminal procedure had been subverted to elicit evidence in a civil case. Pp. 681-684.

Reversed.

Page 678

DOUGLAS, J., lead opinion

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

This is a civil suit brought under § 4 of the Sherman Act, 26 Stat. 209, as amended, 15 U.S.C. § 4, to enjoin alleged violations of § 1 and § 2 of the Act. The civil suit was filed on the heels of a grand jury investigation in which no indictment was returned. The Government is using the grand jury transcript to prepare the civil case for trial, and appellees, who are defendants in that suit, desire the same privilege. They moved for discovery and production of the minutes under the Rules of Civil Procedure.1 The District Court granted the motion, ruling that appellees had shown "good cause" as required by Rule 34.2 It rested on the ground that the Government

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was using the transcript in preparation for trial, that it would be useful to appellees in their preparation, [78 S.Ct. 985] that only in this way could appellees get the information. These reasons, the court held, outweighed the reasons behind the policy for maintaining secrecy of the grand jury proceedings. 19 F.R.D. 122, 128.

The District Court entered orders directing the Government to produce the transcript in 30 days and to permit appellees to inspect and copy it. The Government, adamant in its refusal to obey, filed a motion in the District Court requesting that those orders be amended to provide that, if production were not made, the court would dismiss the complaint. Alternatively, the Government moved the District Court to stay the order pending the filing of an appeal and an application for extraordinary writ. Appellees did not oppose the motion, and the District Court entered an amended order providing that, unless the Government released the transcript by August 24, 1956, "the Court will enter an order dismissing the complaint."3 As the Government persisted

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in its refusal, the District Court entered judgment of dismissal. The case is here by way of appeal, 32 Stat. 823, as amended, 62 Stat. 869, 989, 15 U.S.C. § 29. We postponed the question of jurisdiction to argument on the merits. 352 U.S. 997

First. The orders of dismissal were final orders, ending the case.4 See United States v. Wallace & Tiernan Co., 336 U.S. 793.

Appellees urge that this appeal may not be maintained, because dismissal of the complaint was solicited by the Government. They invoke the familiar rule that a plaintiff who has voluntarily dismissed his complaint may not sue out a writ of error. See Evans v. Phillips, 4 Wheat. 73; United States v. Babbitt, 104 U.S. 767. The rule has no application here. The Government at all times opposed the production orders. It might, of course, have tested their validity in other ways -- for example, by the route of civil contempt. Yet it is understandable why a more conventional way of getting review of the adverse ruling might be sought and any unseemly conflict with the District Court avoided. When

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the Government proposed dismissal for failure to obey, it had lost on the merits, and was only seeking an expeditious review. This case is therefore like Thomsen v. Cayser, 243 U.S. 66, where the losing party got the lower court to [78 S.Ct. 986] dismiss the complaint, rather than remand for a new trial, so that it could get review in this Court. The court, in denying the motion to dismiss, said

The plaintiffs did not consent to a judgment against them, but only that, if there was to be such a judgment, it should be final in form instead of interlocutory, so that they might come to this court without further delay.

Id. at 83.

Second. On the merits, we have concluded that "good cause," as used in Rule 34, was not established. The Government as a litigant is, of course, subject to the rules of discovery. At the same time, we start with a long established policy that maintains the secrecy of the grand jury proceedings in the federal courts.5 See United States v. Johnson, 319 U.S. 503, 513; Costello v. United States, 350 U.S. 359, 362. The reasons are varied.6 One

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is to encourage all witnesses to step forward and testify freely without fear or retaliation. The witnesses in antitrust suits may be employees or even officers of potential defendants, or their customers, their competitors, their suppliers. The grand jury, as a public institution serving the community, might suffer if those testifying today knew that the secrecy of their testimony would be lifted tomorrow. This "indispensable secrecy of grand jury proceedings," United States v. Johnson, supra, at 513, must not be broken except where there is a compelling necessity. There are instances when that need will outweigh the countervailing policy. But they must be shown with particularity.

No such showing was made here. The relevancy and usefulness of the testimony sought were, of course, sufficiently established. If the grand jury transcript were made available, discovery through depositions, which might involve delay and substantial costs, would be avoided. Yet these showings fall short of proof that, without the transcript, a defense would be greatly prejudiced, or that, without reference to it, an injustice would be done. Modern instruments of discovery serve a useful purpose, as we noted in Hickman v. Taylor, 329 U.S. 495. They, together with pretrial procedures, make a trial less a game of blind man's buff and more a fair contest with the basic issues and facts disclosed to the fullest practicable [78 S.Ct. 987] extent. Id. at 501. Only strong public policies weigh against disclosure. They were present in Hickman

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v. Taylor, supra, for there, the information sought was in the trial notes of the opposing lawyer. They are present here because of the policy of secrecy of grand jury proceedings. We do not reach in this case problems concerning the use of the grand jury transcript at the trial to impeach a witness, to refresh his recollection, to test his credibility, and the like.7 Those are cases of particularized need, where the secrecy of the proceedings is lifted discretely and limitedly. We only hold that no compelling necessity has been shown for the wholesale discovery and production of a grand jury transcript under Rule 34. We hold that a much more particularized, more discrete showing of need is necessary to establish "good cause." The court made no such particularized finding of need in case of any one witness. It ordered that the entire transcript be delivered over to the appellees. It undoubtedly was influenced by the fact that this type of case is complex, long drawn out, and expensive to prosecute and defend. It also seemed to have been influenced by the fact that the prosecution was using criminal procedures to elicit evidence in a civil case. If the prosecution were using that device, it would be flouting the policy of the law. For, in these Sherman Act cases, Congress has guarded against in camera proceedings by providing that "the taking of depositions . . . shall be open to the public," and that no order excluding the public shall be valid. 37 Stat. 731, 15 U.S.C. § 30.

We cannot condemn the Government for any such practice in this case. There is no finding that the grand jury proceeding was used as a shortcut to goals otherwise barred or more difficult to reach. It is true that no indictment was returned in the present case. But that is no reflection on the integrity of the prosecution. For all

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we know, the trails that looked fresh at the start faded along the way. What seemed at the beginning to be a case with a criminal cast apparently took on a different character as the events and transactions were disclosed. The fact that a criminal case failed does not mean that the evidence obtained could not be used in a civil case. It is only when the criminal procedure is subverted that "good cause" for wholesale discovery and production of a grand jury transcript would be warranted. No such showing was made here.

Reversed.

WHITTAKER, J., concurring

MR. JUSTICE WHITTAKER, concurring.

Believing that appellees did not make...

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