Atlantic City Electric Co. v. General Electric Co.

Citation207 F. Supp. 620
PartiesATLANTIC CITY ELECTRIC COMPANY et al., Plaintiffs, v. GENERAL ELECTRIC COMPANY et al., Defendants.
Decision Date18 July 1962
CourtU.S. District Court — Southern District of New York

Webster, Sheffield, Fleischmann, Hitchcock & Chrystie, and Kaye, Scholer, Fierman, Hays & Handler, New York City, for plaintiffs Atlantic City Electric Co. and others; Bethuel M. Webster, Milton Handler, and James B. Henry, Jr., New York City, of counsel.

Leboeuf, Lamb & Leiby, New York City, for plaintiffs Arkansas Power & Light Co. and others; Horace R. Lamb, and Taylor R. Briggs, New York City, of counsel.

Winthrop, Stimson, Putnam & Roberts, New York City, for plaintiffs Consumers Power Co. and others; Merrell E. Clark, Jr., James T. Boorsch, and B. Brooks Thomas, New York City, of counsel.

Reid & Priest, and Coudert Brothers, New York City, for plaintiffs Dallas Power & Light Co. and others; Joseph A. McManus, Clifford D. Root, New York City, Peyton G. Bowman III, Washington, D. C., William Rand, Jr., and James C. Pressey, New York City, of counsel.

Naylon, Foster, Dean & Aronson, New York City, for plaintiffs New York State Electric & Gas Corp. and others; Edward F. Huber, Howard M. Schmertz, New York City, and James M. Baisley, New York City, of counsel.

Louis J. Lefkowitz, New York City, for plaintiffs People of State of New York and others; Mathias Lloyd Spiegel, Albany, N. Y., of counsel.

Sidney Goldstein, New York City, for plaintiff Port of New York Authority; Nathaniel Fensterstock, and Milton H. Pachter, New York City, of counsel.

Thomas Moore, Jr., New York City, for plaintiff Power Authority of New York; Scott B. Lilly, New York City, of counsel.

Leo Larkin, New York City, for plaintiffs City of New York and others.

Cravath, Swaine & Moore, New York City, for defendant Westinghouse Electric Corp.; Albert Ray Connelly, New York City, of counsel.

Davis, Polk, Wardwell, Sunderland & Kiendl, New York City, for defendants Allis-Chalmers Manufacturing Co. and others; S. Hazard Gillespie, New York City, of counsel.

Wickes, Riddell, Bloomer, Jacobi & McGuire, New York City, for defendants C. H. Wheeler Manufacturing Co. and others; Harold F. McGuire, New York City, of counsel.

Brown, Wood, Fuller, Caldwell & Ivey, New York City, for defendant A. B. Chance Co.

Hughes, Hubbard, Blair & Reed, New York City, for defendant Allen-Bradley Co.

Richard Owen, New York City, for defendant Cole Electric Co.

Proskauer, Rose, Goetz & Mendelsohn, New York City, for defendants Cornell-Dubilier Electric Corp. and others.

Kissam & Halpin, New York City, for defendant Cutler-Hammer, Inc.

Meyer, Kissel, Matz & Seward, New York City, for defendant Foster Wheeler Corp.

White & Case, New York City, for defendant General Electric Co.

Satterlee, Warfield & Stephens, New York City, for defendant Hubbard & Co.

Haight, Gardner, Poor & Havens, New York City, for defendant I-T-E Circuit Breaker Co.

Austin, Burns, Appell & Smith, New York City, for defendant Ingersoll-Rand Co.

Stickles, Hayden, Young, Kennedy & Hort, New York City, for defendants Joslyn Mfg. & Supply Co. and others.

Casey, Lane & Mittendorf, New York City, for defendant Kuhlman Electric Co.

Cleary, Gottlieb & Steen, New York City, for defendants Moloney Electric Co. and others.

Sheridan & Madigan, New York City, for defendant Murray Manufacturing Corp.

Kupfer, Silberfield, Nathan & Danziger, New York City, for defendant Norbute Corp.

LaPorte & Meyers, New York City, for defendant Schwager-Wood Corp.

Clark, Carr & Ellis, New York City, for defendant Southern States, Inc.

Allan D. Emil, New York City, for defendant Square D. Co.

Alexander & Green, New York City, for defendants H. K. Porter Co. and others.

Close, Griffiths, McCarthy & Gaynor, White Plains, N. Y., for defendant Ward Leonard Electric Co.

Gallop, Climenko & Gould, New York City, for defendant Worthington Corp.

FEINBERG, District Judge.

Defendants in 418 antitrust treble-damage actions joined in three motions under Rule 12(f), Fed.R.Civ.P., 28 U.S. C.A. to strike certain allegations from the complaints. My opinion dated July 11, 1962,1 dealt with the first of these and describes the background of the litigation. This opinion deals with the remaining motions directed to allegations relating to criminal and civil injunctive suits brought by the Government in Philadelphia against many of these defendants, and other allegedly prejudicial evidentiary matter.

The motions should be considered in the context of authority that not only makes clear that motions to strike on the grounds alleged here are not favored, but also raises grave doubt whether anything is gained by allowing the pleadings to be the battlefield in complex cases rather than moving such cases expeditiously through carefully supervised pretrial procedures.

In Nagler v. Admiral Corp., 248 F.2d 319 (2 Cir. 1957), a treble-damage suit, the Court of Appeals reversed a judgment dismissing a complaint as insufficient. Attack on the complaint in Nagler asserted that too little — not, as here, too much — was alleged. But the Court stressed that over-emphasis on the pleading process in these cases is unwise. Thus, the Court said (248 F.2d at 326-327):

"The sad truth is that these cases are likely to prove laborious in any event and that there is no real substitute for trial, although pre-trial conferences and orders may greatly speed the result. * * * The real solution — so far as there is one short of trial — would appear to be * * * continuing pre-trial conferences under the direction of a single judge who may thus avoid the duplicating efforts of various judges we have noted above."

While it is true that the Court in Nagler referred to pleading of evidence as "surely not required and * * * on the whole undesirable," (Id. at 326) the author of the Court's opinion elsewhere stated:

"Occasionally there is a direction to prune off surplusage, a theoretically sound point of view, since these complaints, far from being models, are usually singularly verbose and full of unnecessary conclusions, cliches, and counts. Indeed, I fear the trend I am discussing in part because it promotes verbosity. But is there time in the Southern District for such pruning and perfectionism when the easier course is just to treat such excesses with silent disdain?" Clark, Special Pleading in the "Big Case," 21 F. R.D. 45, 51 (1957).2

This pragmatic attitude is consistent with the general doctrine that has grown up around Rule 12(f). In discussing that doctrine, Professor Moore, after stating that motions to strike are not favored, adds:

"Matter will not be stricken from a pleading unless it is clear that it can have no possible bearing upon the subject matter of the litigation. If there is any doubt as to whether under any contingency the matter may raise an issue, the motion should be denied. Even if the allegations are redundant or immaterial, they need not be stricken if their presence in the pleading cannot prejudice the adverse party. * * * And where certain evidential facts, when read with the complaint as a whole, give a full understanding thereof, they need not be stricken. In suits involving multiple and complex issues greater latitude in pleading may be allowed since the impertinence may not be so clear." 2 Moore, Federal Practice 2317-2319 (2 Ed.1961).

Thus, in Fleischer v. A. A. P., Inc., 180 F. Supp. 717, 721 (S.D.N.Y.1959), the Court observed:

"Before it may be determined that a portion of a complaint is immaterial it must clearly appear that the matter alleged can have no possible bearing on the issues of the trial * * *. Even if that determination is made, immaterial allegations, and likewise verbose, conclusory, or evidentiary allegations, need not be stricken unless their presence in the complaint prejudices the defendant."

Cf. Buchholtz v. Renard, 188 F.Supp. 888, 894 (S.D.N.Y.1960); Gas Consumers Ass'n v. Philadelphia Gas Works Co., 12 F.R.D. 125, 127 (E.D.Pa.1951); Tivoli Realty, Inc. v. Paramount Pictures, Inc., 80 F.Supp. 800 (D.Del.1948); Sinaiko Bros. Coal & Oil Co. v. Ethyl Gasoline Corp., 2 F.R.D. 305 (S.D.N.Y. 1942); see Boerstler v. American Medical Ass'n, 16 F.R.D. 437, 446 (N.D.Ill. 1954).

These cases and modern notions of the pleading process in "big" cases3 express a useful approach: little is accomplished from attempting to prune complaints at this stage; they should be left intact unless matter is alleged whose materiality is highly unlikely. If such matter is alleged, then the Court may strike it, in its discretion, depending upon its assessment of other factors, including possible prejudice, elements of unfairness and threat of delay.

I The Motion to Strike References to Prior Grand Jury and Government Proceedings

The allegations objected to are classifiable as: (1) references to pleas of guilty and the judgments entered thereon; (2) references to pleas of nolo contendere and the judgments entered thereon; (3) references to other incidents of the Government suits, such as the pendency of the civil injunctive proceedings, the indictments, the sentences and the Grand Jury proceedings. Defendants contend that these allegations are "immaterial, impertinent and unfairly prejudicial to defendants."

A. References to Pleas of Guilty and Judgments Thereon

Defendants have moved to strike all references to the pleas of guilty entered in the Philadelphia proceedings,4 and the judgments of conviction on these pleas. Defendants, relying on the language of the statute, legislative history and judicial authority, argue that judgments on pleas of guilty are "consent judgments" within the meaning of the proviso to Section 5(a) of the Clayton Act, 15 U.S.C.A. § 16(a) ("Section 5(a)"), which states:

"(a) A final judgment or decree heretofore or hereafter rendered in any civil or criminal proceeding brought by or on behalf of the United States under the antitrust laws to the effect that a defendant has violated said laws shall be prima
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