Commonwealth Edison Co. v. Allis-Chalmers Mfg. Co.

• Decision Date: 01 April 1963
• Docket Number: No. 13904.,13904.
• Citation: 315 F.2d 564
• Parties: COMMONWEALTH EDISON COMPANY et al., Plaintiffs-Appellees, v. ALLIS-CHALMERS MANUFACTURING COMPANY et al., Defendants-Appellees, and State of Illinois, Appellant-Applicant for Intervention.
• Court: U.S. Court of Appeals — Seventh Circuit

315 F.2d 564 (1963)

COMMONWEALTH EDISON COMPANY et al., Plaintiffs-Appellees, v. ALLIS-CHALMERS MANUFACTURING COMPANY et al., Defendants-Appellees, and State of Illinois, Appellant-Applicant for Intervention.

No. 13904.

United States Court of Appeals Seventh Circuit.

April 1, 1963.

Lee A. Freeman, Chicago, Ill., William G. Clark, Atty. Gen. of State of Illinois, Chicago, Ill., for appellant-applicant for intervention.

Charles A. Bane, Robert B. Wilcox, Richard E. Powell, John P. Ryan, Jr., Chicago, Ill., Sharon L. King, Washington, D. C., Paul G. Jasper, Plainfield, Ind., Martin R. Paulsen, Milwaukee, Wis., for plaintiff-appellees.

Isham, Lincoln & Beale, Chicago, Ill., George H. Jirgal, Chicago, Ill., for Central Illinois Electric & Gas Co. Harry E. Witherell, Peoria, Ill., for Central Illinois Light Co.

William B. Waterman, Walter S. Rogowski, Davenport, Iowa, Max Swiren, Neil Flanagin, Chicago, Ill., of counsel, for Iowa-Illinois Gas & Electric Co.

John Paul Stevens, Richard L. McIntire, Rothschild, Hart, Stevens & Barry, Chicago, Ill., for A. B. Chance Co. and Foster Wheeler Corporation.

Edward R. Johnston, Thompson, Raymond, Mayer & Jenner, Chicago, Ill., for Allan Bradley Co., Clark Controller Co., Cutler-Hammer, Inc., Lapp Insulator Co., Inc., McGraw-Edison Co., Ohio Brass Co., and Square D Co.

Holmes Baldridge, John M. Kerwin, Stiefel, Greenberg, Burns & Baldridge, Chicago, Ill., for Allis-Chalmers Mfg. Co.

Earl E. Pollock, Frederic S. Lane, Sonnenschein, Lautmann, Levinson, Rieser, Carlin & Nath, Chicago, Ill., for Cornell-Dubilier Electric Corporation, Federal Pacific Electric Co., Moloney Electric Co. in Nos. 62 C 87, 62 C 88, 62 C 184 and 62 C 188 and Wagner Electric Corporation in Nos. 62 C 87, 62 C 88, 62 C 184 and 62 C 188, Sangamo Electric Company in Nos. 62 C 89 and 62 C 186.

John T. Chadwell, Richard M. Keck, Richard Calkins, John J. McHugh, Chadwell, Keck, Kayser, Ruggles & McLaren, Chicago, Ill., for General Electric Co.

Jacob H. Martin, Sydney G. Craig, Martin Bogot, Martin, Craig, Chester & Sonnenschein, Chicago, Ill., for H. K. Porter Co., Inc.

Charles M. Price, Robert C. Keck, Valentine A. Weber, Jr., MacLeish, Spray, Price & Underwood, Chicago, Ill. for Carrier Corporation and C. H. Wheeler Mfg. Co.

Timothy G. Lowry, Owen Rall, Elroy C. Sandquist, Jr., Peterson, Lowry, Rall, Barber & Ross, Chicago, Ill., for I-T-E Circuit Breaker Co.

Harold T. Halfpenny, Halfpenny, Hahn & Ryan, Chicago, Ill., for Ingersoll-Rand Co.

Roland D. Whitman, Joseph A. Conerty, Ross, McGowan & O'Keefe, Chicago, Ill., for Joslyn Mfg. & Supply Co. and Porcelain Insulator Corporation.

Lloyd M. McBride, McBride, Baker, Wienke & Schlosser, Chicago, Ill., for Kuhlman Electric Co.

Neil McKay, Winston, Strawn, Smith & Patterson, Chicago, Ill., for Hubbard & Co.

W. Donald McSweeney, John A. Pigott, Dallstream, Schiff, Hardin, Waite & Dorschel, Chicago, Ill., for Moloney Electric Co., Sangamo Electric Co. and Wagner Electric Corporation.

Edward R. Adams, Miller, Gorham, Wescott & Adams, Chicago, Ill., for Southern States, Inc.

Hammond E. Chaffetz, William R. Jentes, George D. Newton, Jr., Melvin R. Goldman, Kirkland, Ellis, Hodson, Chaffetz & Masters, Chicago, Ill., for Westinghouse Electric Corporation.

Brainerd Chapman, Pritchard, Chapman, Pennington, Montgomery & Sloan, Chicago, Ill., for Worthington Corporation.

Before HASTINGS, Chief Judge, and KNOCH and SWYGERT, Circuit Judges.

SWYGERT, Circuit Judge.

Among the plaintiffs in eighteen related antitrust suits filed below charging defendants, electrical equipment manufacturers, with conspiracy to fix prices, allocate markets and submit collusive bids, are four public utilities operating in the State of Illinois, namely, Commonwealth Edison Company, Central Illinois Electric and Gas Co., Central Illinois Light Company and Iowa-Illinois Gas and Electric Company. (These four Illinois public utilities will hereinafter be referred to as plaintiffs). Plaintiffs serve some 2,500,000 consumers with electric light and power.

The district court's original jurisdiction was invoked under Section 1 of the Sherman Act and Sections 4, and 5(b) of the Clayton Act (15 U.S.C. §§ 1, 15, and 16(b)). The effect of these price fixing conspiracies, it is alleged, was the creation of "high and artificial levels" of prices for the electrical equipment purchased by plaintiffs. All of these cases arise out of the so-called Philadelphia Electrical Conspiracy Cases.

The Attorney General of Illinois seeks to intervene in these proceedings for the State of Illinois. Intervention is sought as of right in order to represent and protect the interests of the public consumers of plaintiffs who it is claimed were injured by defendants' price fixing conspiracies in that plaintiffs were caused to pay high and artificial prices for electrical equipment used in its utility operations, which excessive prices were in turn collected from the public consumers through higher utility rates.

The State of Illinois in support of its motion for intervention urges that it has in behalf of the public consumers a direct interest in the recoveries which may be realized in these proceedings and that its participation is necessary to effectuate a proper and equitable distribution among the injured parties of any monies or fund so recovered. It is further urged that, "The representation of this public interest by existing parties may be inadequate and the applicant may be bound by a judgment or order in the action."

Permissively, the Attorney General seeks to intervene on behalf of state agencies and institutions which have made purchases from defendants of the involved electrical equipment during the period of the conspiracy. It is alleged that the claims arising from these purchases present questions of law and fact which are common to the main action.

Both plaintiffs and defendants oppose the motion of the State of Illinois to intervene.

The district court denied the State's application for intervention both as of right and permissively. The district judge's memorandum stating his reasons for the ruling appears in 207 F.Supp. 252.

This appeal was taken in the first of these eighteen related cases under a stipulation among the parties that this court's determination in this appeal shall govern the matter of intervention by the State of Illinois in all of the related cases.

I. INTERVENTION AS OF RIGHT.

We agree that the district judge was correct in not allowing the State of Illinois by its Attorney General to intervene in behalf of the consumers of the four public utility plaintiffs; we reach that result, however, for a different reason.

The primary essential element that must exist for an applicant to intervene in a pending action as of right under Rule 24(a) Fed.R.Civ.P. is that he have a direct personal or pecuniary interest in the subject of the litigation; in this, the mandatory provisions differ from the permissive under Rule 24(b) Fed.R.Civ.P. See Securities & Exchange Comm'n. v. United States Realty Co., 310 U.S. 434, 459, 60 S.Ct. 1044, 84 L.Ed. 1293 (1940). All other essential elements, i. e., "representation of the applicant's interest by existing parties is or may be inadequate and the applicant is or may be bound by a judgment in the action" (Rule 24(a) (2)), as well as "the applicant is so situated as to be adversely affected by a distribution or other disposition...