Dairy Industries Supply Ass'n v. La Buy

• Decision Date: 04 November 1953
• Docket Number: No. 10873.,10873.
• Citation: 207 F.2d 554
• Parties: DAIRY INDUSTRIES SUPPLY ASS'N v. LA BUY.
• Court: U.S. Court of Appeals — Seventh Circuit

207 F.2d 554 (1953)

DAIRY INDUSTRIES SUPPLY ASS'N v. LA BUY.

No. 10873.

United States Court of Appeals Seventh Circuit.

November 4, 1953.

Walter J. Cummings, Jr., H. Blair White, Chicago, Ill., for petitioner.

Henry S. Blum, Bernard G. Sang, Vincent J. Carney, Chicago, Ill., for respondent.

Before MAJOR, Chief Judge, and DUFFY and SWAIM, Circuit Judges.

SWAIM, Circuit Judge.

On September 20, 1952, Maryland Baking Company and Northwest Cone Company, corporations organized under the laws of the State of Maryland and having their principal places of business in Baltimore, Maryland, and Chicago, Illinois, respectively, commenced an action in the United States District Court for the Northern District of Illinois against Dairy Industries Supply Association, hereinafter referred to as DISA, a corporation organized under the laws of the State of New York and having its principal place of business in Washington, D. C., and against its officers and directors, both in their official capacities and as individuals. The complaint alleged that the defendants combined and conspired together to bar and prevent Maryland Baking Company from exhibiting its wares and to prevent its wholly-owned subsidiary, Northwest Cone Company, from furnishing its products to the exhibitors at the National Dairy Industries Exposition which DISA held on Navy Pier in Chicago, commencing September 22, 1952. The complaint alleged that this action by the defendants was in violation of the Sherman Anti-Trust Act, 26 Stat. 209, 15 U.S.C.A. § 1, and that plaintiffs brought this action under the Clayton Anti-Trust Act, § 4, 38 Stat. 731, 15 U.S.C.A. § 15. The complaint asked that the defendants be enjoined from preventing the plaintiff Maryland Baking Company from exhibiting its wares at the Chicago exposition and from preventing Northwest Cone Company from furnishing its products to the exhibitors at said exposition and also asked for a judgment for treble damages for the injuries sustained by plaintiffs by reason of the alleged unlawful acts of the defendants in excluding the two plaintiffs from participating in said exposition.

On October 30, 1952, DISA and the individual defendants who had been served with summons in the action filed a motion to transfer the action to the United States District Court for the District of Columbia pursuant to 28 U.S. C. § 1404(a). On the same date DISA filed its motion to quash the service of summons made upon it in Chicago during the convention and the alias summons served upon it thereafter in Washington, D. C. In this latter motion DISA also moved to dismiss the action for want of venue in the Northern District of Illinois. The defendants filed four affidavits made by Roberts Everett, executive vice president of the corporate defendant, in support of these motions. The plaintiffs opposed these motions and filed, in opposition to the motions, the affidavit of Henry Shapiro who was the president of Maryland Baking Company and the secretary of Northwest Cone Company.

After considering the pleadings, motions, affidavits, arguments and briefs of the parties, the District Court was of the opinion that the corporate defendant, DISA, "was doing business here to such an extent and in such manner that actual presence was established and it was `found' here at the time of the service of summons on September 24, 1952." The District Court also found that the defendants had failed to sustain their burden to prove that for the convenience of the parties and witnesses, and in the interest of justice, the District Court should transfer the action to the District of Columbia, pursuant to 28 U.S.C. § 1404(a).

The District Court thereupon entered an order overruling the defendants' motion to quash the service of summons and denying their motion to transfer the action to the District Court for the District of Columbia.

The defendants then filed in this court a petition for a writ of mandamus directing the District Court to vacate and set aside its order denying the petition to transfer and directing the transfer of the action or, in the alternative, directing that the action be dismissed for want of venue in the Northern District of Illinois.

Section 12 of the Clayton Act, 15 U.S. C.A. § 22, provides:

"Any suit, action, or proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found."

Thus, as the Supreme Court said in United States v. Scophony Corporation, 333 U.S. 795, 802, 68 S.Ct. 855, 859, 92 L.Ed. 1091:

"Section 12 of the Clayton Act has two functions, first, to fix the venue for antitrust suits against corporations; second, to determine where process in such suits may be served. Venue may he had `not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business.\' And all process may be served `in the district of which it is an inhabitant, or wherever it may be found.\' (Emphasis added.)"

The court also pointed out that § 12 of the Clayton Act was an enlargement over similar prior statutes which only provided for such actions in districts where the corporation "resides or is found." 28 Stat. 570, § 77 and 26 Stat. 210, § 7.

In the Scophony case the court said, 333 U.S. at page 807, 68 S.Ct. at page 862, that under § 12 of the Clayton Act, "the practical, everyday business or commercial concept of doing or carrying on business `of any substantial character' became the test of venue." Under § 12, as so interpreted, we think the corporate defendant in the instant case was transacting business in the Northern District of Illinois when the action against it was commenced.

DISA is described by Roberts Everett, its executive vice president as "a trade association comprising some four hundred members — persons, firms and corporations — which originate, make or distribute the essential manufacturing and marketing machinery, equipment, materials, supplies and ingredients or supply basic services for milk processing and dairy product manufacturing industries of the United States and Canada." Mr. Everett listed fourteen different activities and services in which DISA is engaged,...