United States v. Allied Chemical & Dye Corporation

• Decision Date: 19 November 1941
• Citation: 42 F. Supp. 425
• Parties: UNITED STATES v. ALLIED CHEMICAL & DYE CORPORATION et al.
• Court: U.S. District Court — Southern District of New York

42 F. Supp. 425

UNITED STATES v. ALLIED CHEMICAL & DYE CORPORATION et al.

District Court, S. D. New York.

November 19, 1941.

Thurman Arnold, Asst. Atty. Gen., Samuel S. Isseks, and Herbert A. Berman, Sp. Assts. to Atty. Gen., and Nelson A. Sharfman, Sp. Atty., of New York City, for the Government.

Coudert Brothers, and John J. Burns, both of New York City, for defendants Imperial Chemical Industries (N.Y.), Ltd., et al.

Mudge, Stern, Williams & Tucker, of New York City, for defendants Compania Salitrera Anglo Chilena et al.

Breed, Abbott & Morgan, of New York City, for defendants Synthetic Nitrogen Products Corporation.

White & Case, of New York City, for defendants Chilean Nitrate Sales Corporation et al.

BRIGHT, District Judge.

This motion for a bill of particulars with reference to an indictment laid under the Sherman Anti-Trust Act, Title 15 U.S.C.A. §§ 1-3, Act approved July 2, 1890, as amended by Act approved August 17, 1937, and the Wilson Tariff Act, Title 15 U.S.C.A. § 8, Act approved August 27, 1894, and amended by Act approved February 12, 1913, presents an unusual and extraordinary set of circumstances, the like of which I have not found in any reported case.

The indictment, as returned, named nine corporations and twenty-five individuals, directors and officers of the indicted corporations and of other corporations not indicted. Eighteen of these defendants have capitulated and the indictment as to them has been nolle prossed. The remaining defendants who join in this motion are five corporations — Imperial Chemical Industries (N.Y.) Ltd., Anglo-Chilean Nitrate Corporation, The Lautaro Nitrate Company, Ltd., Chilean Nitrate Sales Corporation, and Synthetic Nitrogen Products Corporation — and eleven individuals — Richard Fort, Medley Gordon Brittain Whelpley, James F. Doetsch, Kenneth H. Rockey, James Albert Woods, George R. Petitt, A. L. Mullaly, C. B. Peters, C. Schreiber, F. P. Scar and Miguel Tegtmeyer, officers and directors of the corporations mentioned.

The indictment also names as co-conspirators and not as defendants, forty-two other corporations, and sixty-three individuals. These latter named corporations and individuals are residents of Japan, Holland, Belgium, Italy, Poland, Switzerland, Germany, France, Sweden, Palestine, England, Norway, Chile, Canada and of the states of New York, California and Georgia.

The indictment is framed in fourteen counts, the first eleven under the Sherman Act and the other three under the Wilson Tariff Act. Each count alleges unlawful combinations and conspiracies (1) to control the importation of fertilizer nitrogen into the United States; (2) to control the exportation of such fertilizer from the United States; (3), (4) and (5) to fix and maintain non-competitive prices for the sale of such fertilizer in Puerto Rico, Hawaii and the Philippine Islands; (6), (7) and (8) to fix and maintain non-competitive prices for the sale of such fertilizer between the United States and the three territories last named; (9), (10) and (11) to fix and maintain such prices between the three territories named and foreign nations; (12) to restrain lawful trade in such fertilizer imported into the United States; (13) to restrain free competition in lawful trade and commerce in such fertilizer so imported.

The indictment was returned September 1, 1939, when the world was practically at peace. It remained sealed, however, until December 3, 1940, fifteen months later, at which time the war in Europe had started. Since then, that war has engulfed all of the countries in Europe named in the indictment, and has made difficult, if not impossible, means of communication with the rest of the world, at least with those countries in the other hemisphere mentioned in the indictment.

Whether the moving defendants will be able to obtain any assistance or information for their defense from the companies and individuals who have surrendered, is questionable, to say the least.

A brief review of the indictment will reveal that the crimes charged are worldwide and involve trade and commerce in fertilizer nitrogen in every corner of the globe. The period of the alleged combination and conspiracy covers seven years. Fertilizer nitrogen, as it is mentioned in the indictment, exists in many forms, and is used in various combinations in the preparation of mixed fertilizers. The first thirty-two paragraphs of the indictment, incorporated by reference in each of the counts, allege the wide use of the many forms throughout the world. Substantial quantities of one form are imported into the United States from the Netherlands and from Canada, and in another form from Germany and Norway. Pursuant to "cartel agreements to which the principal foreign producers, designated as the D.E.N. group — are parties" (who they are is not fully specified), restrictions are imposed upon all importations from foreign countries. The Imperial Chemical Industries, Ltd., an English corporation, manufactures another form and acts as sole seller of that form produced in England, Scotland, Ireland and India, and its subsidiary, The Imperial Chemical Industries (N.Y.) Ltd., one of the moving defendants, acts as its buying and selling agent in the United States. It is further alleged that the principal foreign producers of nitrogen, approximately thirty-five in number (who are not named), are parties to an international cartel agreement, which divides the sale and distribution of fertilizer nitrogen in the markets in the world. They are, it is claimed, associated in cartel agreements with the D.E.N. group, and through them with Belgium, Italian, Polish, Swiss and Czechoslovak producers, not named and not including any of the moving defendants. Other special agreements supplemental to the general cartel agreement are mentioned, one entered into at Zurich April 17, 1939, and another on August 4, 1938, with a Chilean group.

The charging part of the first count alleges an unlawful combination and conspiracy extending over seven years from July 1, 1932, the exact date of its inception being unknown, among the thirty-four named defendants and the one hundred and five co-conspirators "and other persons to the grand jurors unknown", effectuated by fifteen specified means and methods, including, "among others", the exchange of statistical and other information, the constant surveillance and control of importations, arbitrary price fixing, reports of failure to adhere to prices, and in addition to those, the attendance at meetings (as representatives of the cartel groups), at Zurich, Switzerland, Paris and London "and other places", communications by correspondence, trans-Atlantic telephone, exchange of statistical and other information, "and otherwise". The operations it is alleged have been carried on in this district by the parties by acts, "among others", in the holding of meetings at various hotels and clubs "among other places". The other counts are equally as general, the use of the words "among others", "and other persons", "and other places", "and otherwise", appearing in every count and making more general what was general enough before. The method and means by which it is alleged the combination and conspiracy were effected, specifically and generally cover transactions with defendants and non-defendants and other persons, agreements, correspondence, statistics and every conceivable sort of communication and information which might have been had or communicated to individuals in most of the countries of the globe. They embrace practically the entire field of fertilizer nitrogen, some forms of which it is denied by the moving corporate defendants were ever made or sold by them. Obviously, many of the co-conspirators are beyond any means of communication. Assuming proof upon the trial of the combination and conspiracy, the field in which may be proved conversations, acts, communications and meetings between individuals in remote parts of the world, is boundless. It is stated in the moving affidavit that some of the defendants have never had any business dealings with many of the corporations named as co-conspirators,...