Fisons Limited v. United States

• Citation: 458 F.2d 1241
• Decision Date: 03 April 1972
• Docket Number: Misc. No. 1235.
• Parties: FISONS LIMITED and Fisons Pharmaceuticals Ltd., Petitioners-Defendants, v. UNITED STATES of America, Respondent-Plaintiff.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

458 F.2d 1241 (1972)

FISONS LIMITED and Fisons Pharmaceuticals Ltd., Petitioners-Defendants, v. UNITED STATES of America, Respondent-Plaintiff.

Misc. No. 1235.

United States Court of Appeals, Seventh Circuit.

January 5, 1972.

Certiorari Denied April 3, 1972.

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Charles J. Merriam, Chicago, Ill., for petitioners-defendants.

Stephen Rubin, Chicago, Ill., for respondent-plaintiff.

Before PELL, STEVENS and SPRECHER, Circuit Judges.

Certiorari Denied April 3, 1972. See 92 S.Ct. 1312.

STEVENS, Circuit Judge.

Three jurisdictional issues are presented by this appeal: (1) whether an interlocutory order in a civil antitrust case brought by the United States may be reviewed by a court of appeals pursuant to 28 U.S.C. § 1292(b); (2) if so, whether this is an appropriate case for the exercise of that jurisdiction; and (3) if that also be so, whether the district court acquired personal jurisdiction over petitioners as a result of service effected pursuant to § 17(1) (a) of the Illinois Civil Practice Act, Ill.Rev.Stat.1971, c. 110, § 17(1) (a). We answer all three questions in the affirmative.

Petitioners are two British corporations, one the wholly owned subsidiary of the other, each having its principal place of business in England. They manufacture iron dextran in Great Britain and sell it to certain large American companies. Iron dextran is a patented product used in the treatment of anemia and other iron deficiency conditions in humans and other animals. Petitioners own the American patent on iron dextran and have entered into license agreements which the Government claims are violative of the Sherman Act.

This litigation was commenced on July 23, 1969, when the Government filed its complaint pursuant to § 4 of the Sherman Act, 15 U.S.C. § 4, against five defendants, including the two petitioners and their three American licensees. It is alleged that trade in iron dextran has been unreasonably restrained since 1956 by the defendants' license agreements which allocate markets, restrict the resale of the product in bulk form, control the use of certain trademarks, require the licensees to assign all trademarks to petitioners when the agreements expire, and restrict the grant of additional licenses.

The jurisdictional requirement of § 17(1) (a) of the Illinois Civil Practice Act was allegedly satisfied by (1) the existence of the agreements, which affect the economy of Illinois; (2) the fact that all three licensees do business in Illinois; (3) the continual exportation of iron dextran from Britain for resale in Illinois; and (4) the fact that certain business relating to the agreements was transacted in Illinois by officers of petitioners and a predecessor in interest.

On August 21, 1969, petitioners filed a motion to quash service and to dismiss the complaint against them for lack of jurisdiction. The motion was supported by an affidavit in which the conclusory allegations in the complaint were denied, and except for three visits in 1968 and two in 1969, all direct contact between petitioners and the transaction of business in Illinois was specifically denied. The Government conducted extensive discovery on the jurisdictional issue, the matter was briefed extensively, and ultimately the district court overruled the motion to quash or to dismiss.

In his order entered on August 27, 1971, the district judge expressed the opinion that he had decided "a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the Order may materially advance the ultimate termination of this litigation." He then stated the controlling question¹ and ordered that further proceedings involving the two petitioners be stayed "until a final decision on any interlocutory appeal under 28 USC § 1292(b)."

Within the 10-day period specified in the statute petitioners sought permission from this court to take an appeal from that order.² The Government opposed the petition, contending that § 1292 (b) is not applicable to cases which are subject to the Expediting Act of 1903, 15 U.S.C. § 29, and in any event, since the decision of the district court was correct, there was no reason to allow a discretionary appeal.

On September 30, 1971, after noting the importance and novelty in this court of the question presented under § 1292 (b), we set the matter for oral argument, invited the parties to file additional memoranda, and directed that the district court proceedings not be stayed while the issues were under consideration here.

We now explain why we believe each jurisdictional question should be answered affirmatively.

I.

The two statutes directly relevant to the first jurisdictional issue were enacted, respectively, in 1903 and 1958. The earlier is commonly known as the Expediting Act,³ and the latter as the Interlocutory Appeals Act.

The Expediting Act applied to suits in equity brought under the Sherman Act, the Interstate Commerce Act, or any other act "having a like purpose" that might thereafter be enacted. Its first section authorized the Attorney General to file a certificate of importance in such cases, whereupon the matter would be heard by three judges and given precedence over other litigation "and in every way expedited." That procedure, though still authorized by 15 U.S.C. § 28, was not used in this case and has been employed rarely, if at all, in recent years.⁴

Section 2 of the Expediting Act drastically shortened the time for appeal in cases covered by the statute. Prior to its enactment in 1903, six months were allowed in which to take an appeal to the Circuit Court of Appeals, 26 Stat. 826, 829, and one year after the entry of that court's judgment, an appeal lay to the Supreme Court. 26 Stat. at 828. Section 2 provided:

"That in every suit in equity pending or hereafter brought in any circuit court of the United States under any of said Acts, wherein the United States is complainant, including cases submitted but not yet decided, an appeal from the final decree of the circuit court will lie only to the Supreme Court and must be taken within sixty days from the entry thereof. . ."⁵ 32 Stat. 823; 15 U.S.C. § 29.

By its terms, § 2 of the Expediting Act applies to appeals from final decrees in a limited category of cases. The Interlocutory Appeals Act of 1958 makes no reference to final orders and its language is applicable to all civil litigation in the federal district courts. It provides:

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 1292 of title 28 of the United States Code is hereby amended by insertion of the letter (a) at the beginning of the section and adding at the end thereof an additional subparagraph lettered (b) to read as follows:

"`(b) When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals may thereupon, in its discretion, permit an appeal to be taken from such order, if application is made to it within ten days after the entry of the order: Provided, however, That application for an appeal hereunder shall not stay proceedings in the district court unless the district judge or the Court of Appeals or a judge thereof shall so order.\'

"Approved September 2, 1958." 72 Stat. 1770.

A plain reading of the two statutes reveals no inconsistency between them. If they had been enacted simultaneously, the language of each could be given full effect without limiting the scope of the other. If some conflict in literal meaning did exist, under normal rules of construction the later statute would prevail. United States v. Wrightwood Dairy Co., 127 F.2d 907, 912 (7th Cir. 1942); Eisenberg v. Corning, 86 U.S.App.D.C. 21, 179 F.2d 275, 276 (1949).

The purpose of the 1958 Act is consistent with the expediting purpose of the 1903 Act. Although it authorizes a departure from the general practice of postponing appellate review until after the entry of a final judgment, such authorization is only for the purpose of materially advancing the ultimate termination of the litigation. The specified procedure must be invoked within ten days and shall not stay proceedings in the trial court unless a judge shall expressly so direct.

The legislative history of the Interlocutory Appeals Act indicates that it was intended to apply to protracted cases, including antitrust litigation.⁶ Indeed, it is fair to infer that its primary efficacy was expected to occur in cases of exceptional magnitude.⁷ In sum, the plain language, the purpose, and the history of the Interlocutory Appeals Act of 1958 are all consistent with its application to civil antitrust litigation commenced by the United States.

The Government advances a number of arguments for a contrary interpretation. None of these arguments questions the wisdom of applying the 1958 Act to this type of case, or suggests any conflict between the language or the policy of the two statutes. In essence, it is the Government's position that the Expediting Act is an especially important statute which has been construed to mean a great deal more than it says, and specifically to foreclose interlocutory appeals; nothing short of an express amendment of that statute, it is argued, should be permitted to modify that construction. Since other circuits have accepted these arguments,⁸ we have considered them with care.

First, we note that the Expediting Act is just another statute. It has been on the books a long time and it deals with important litigation. But the statute itself commands no special respect today. It has been criticized by Supreme Court Jus...