Westinghouse Electric Corp. v. City of Burlington, Vermont

• Decision Date: 09 June 1965
• Docket Number: No. 18582.,18582.
• Citation: 351 F.2d 762
• Parties: WESTINGHOUSE ELECTRIC CORPORATION et al., Appellants, v. CITY OF BURLINGTON, VERMONT, et al., Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

351 F.2d 762 (1965)

WESTINGHOUSE ELECTRIC CORPORATION et al., Appellants, v. CITY OF BURLINGTON, VERMONT, et al., Appellees.

No. 18582.

United States Court of Appeals District of Columbia Circuit.

Argued December 2, 1964.

Decided June 9, 1965.

COPYRIGHT MATERIAL OMITTED

Mr. William H. Dempsey, Jr., Washington, D. C., with whom Messrs. Francis M. Shea and Richard T. Conway, Washington, D. C., were on the brief, for appellants.

Mr. H. Robert Halper, Atty., Dept. of Justice, of the bar of the Supreme Court of Illinois, pro hac vice, by special leave of court, for appellee Attorney General of the United States. Asst. Atty. Gen., William H. Orrick, Jr., and Messrs. Lionel Kestenbaum and Arthur J. Murphy, Jr., Attys., Dept. of Justice, were on the brief, for appellee Attorney General of the United States.

No brief was filed on behalf of appellee City of Burlington, Vt.

Before WASHINGTON, DANAHER and McGOWAN, Circuit Judges.

WASHINGTON, Circuit Judge.

On January 20, 1964, appellants, defendants below, served upon a representative of the Attorney General of the United States a subpoena duces tecum directing the production of documents relevant to the trial of certain treble-damage antitrust litigation, which might be in the files of the Department of Justice.¹ The subpoena was issued as part of the "National Discovery Program" which had been devised to facilitate and expedite the more than 1800 treble-damage actions which had been brought in the Federal courts against several manufacturers of electrical equipment, including appellants.² These actions were brought in the wake of the Government's criminal actions against these manufacturers in 1960.

The records that were demanded in connection with the subpoena may be described generally as complaints by publicly or privately owned utilities or by associations of such utilities that manufacturers of electrical equipment were, or might have been, violating the antitrust laws with respect to the sale of such equipment during the period between January 1, 1948, and December 31, 1960. The reason for this demand was that such complaints, if there were any, might help establish a defense to the claims of plaintiff-appellees that they should recover damages for transactions beyond the four-year period of limitations because the defendants-appellants had "fraudulently concealed" the alleged conspiracy. Several Courts of Appeals, including this one, have held that the running of the four-year statute of limitations applicable to treble-damage antitrust suits, 15 U.S.C. § 15b, is tolled by fraudulent concealment on the part of the defendants. E. g., City of Burlington, Vermont v. Westinghouse Electric Corp., 215 F.Supp. 497 (D.D.C.1963), aff'd, 117 U.S.App.D.C. 148, 326 F.2d 691 (1964). One well established defense to a claim of fraudulent concealment is that the plaintiff knew, or by the exercise of due diligence could have known, that he may have had a cause of action. Since here many of the plaintiffs' claimed damages related to transactions which took place before the four-year period immediately preceding the bringing of suit, the establishment by defendants that the plaintiffs or others had complained to the Justice Department of antitrust violations by the defendants would be highly relevant to the defense of this action. The fact that such complaints were made would also be relevant in the numerous similar treble-damage actions in other jurisdictions. Discovery of such documents might limit the plaintiffs' damages to those incurred within the four years immediately preceding suit.

On January 25, 1964, the Government filed a motion to quash the subpoena, on the grounds that the documents were protected from disclosure by the "informer's privilege," that in certain respects the subpoena sought irrelevant documents, and that the subpoena was unreasonable and oppressive. The court, after a hearing, granted the motion on the informer's privilege and oppressiveness grounds. This appeal followed.

While it is true that this court's review of District Court orders going to the scope of discovery is limited, we think that the District Judge abused his discretion, that his order should be set aside, and that the matter should be remanded for further proceedings. The lower court's action in quashing the subpoena was in our view "improvidently taken," and it "affected the substantial rights of the parties." Sher v. De Haven, 91 U.S.App.D.C. 257, 261, 199 F.2d 777, 781, 36 A.L.R.2d 937 (1952). We do not now hold that the broad subpoena sought by the defendants should be enforced; but we instruct the trial judge to reconsider, in the light of the principles outlined herein, the possibility of reaching an accommodation between the defendants and the Department of Justice.

I.

After the District Court granted the motion to quash, defendants-appellants requested that the court add to its order a certification that the decision warranted appeal under 28 U.S.C. § 1292(b). The request was denied, and this appeal, under 28 U.S.C. § 1291, followed. Appellees moved to have the appeal dismissed on the ground that an order of a District Court quashing a subpoena in an action pending in that court is not a final order within the meaning of Section 1291.³ By order of June 11, 1964, we denied the motion to dismiss, without prejudice to a renewal of the motion at the time of the argument of the appeal. Appellees renewed motion, and we must, as a preliminary matter, decide the point.

It is clear that ordinarily an order quashing a subpoena issued against a party in a case pending in the District Court in which the order was entered is not appealable. See Hoffa v. United States, 309 F.2d 680 (5th Cir.) cert. denied, 371 U.S. 878, 83 S.Ct. 147, 9 L.Ed. 2d 115 (1962).⁴ There is a conflict of authority on the question of whether an order quashing a subpoena entered in a district other than the one in which the main case is pending is appealable. Compare Palmer v. Fisher, 228 F.2d 603 (7th Cir. 1955), with Horizons Titanium Corp. v. Norton Co., 290 F.2d 421 (1st Cir. 1961). In the latter case the order quashing the subpoena was held to be final and appealable. The Horizons Titanium result has been adopted in this jurisdiction without discussion. Machin v. Zuckert, 114 U.S.App.D.C. 335, 316 F.2d 336, cert. denied, 375 U.S. 896, 84 S.Ct. 172, 11 L.Ed.2d 124 (1963). See 4 MOORE, FEDERAL PRACTICE ¶ 26.37 1.1.-2-2 hereinafter cited as MOORE, approving this result. The subpoena herein was sought as part of the National Discovery Program; it sought information that was of value to defendants in numerous treble-damage actions in other jurisdictions as well as the defendants in this jurisdiction. The issue here is whether this fact brings it within the reasoning of the Horizons Titanium decision.

In Horizons Titanium the order quashing the subpoena would have been unreviewable if an appeal from the order had not been allowed. That is not so clearly the case here. If the order quashing the appeal is held unappealable at this time, the defendants below could still present the issue to us in an appeal from the decision in the main case. This approach, however, overlooks the fact that numerous defendants in other jurisdictions, involved in the National Discovery Program, are also interested in this subpoena; and they may have no review of the decision as it affects them if we do not review it herein. We see no reason why their claim to prompt appellate review should rest on the decision of the defendants below (appellants in this case) whether or not to appeal from the final judgment in the main case. Furthermore, litigation may be terminated in other jurisdictions by the time an appeal in the main case is decided, if such an appeal is taken. The issues involved in the instant appeal are separable from the issues involved in the main case. Hence, we pass to a consideration of the present appeal on the merits.⁵

II.

The Government contends that the subpoena should be quashed on the grounds that it is unreasonable and oppressive. FED.R.CIV.P. 45(b). The burden of proving that a subpoena duces tecum is oppressive is on the party moving for relief on this ground. 5 MOORE ¶ 45.05 2. The burden is particularly heavy to support a "motion to quash as contrasted to some more limited protection." Horizons Titanium Corp. v. Norton Co., 290 F.2d 421, 425 (1st Cir. 1961). The two affidavits submitted by appellees are not sufficient to bear this burden. Appellants have expressed their willingness to accept some reasonable effort by the Government, that would be less than a page-by-page search. The lower court, in these circumstances, should have sought some way to accommodate the interests of the defendants herein with the practical problems of searching the Government's voluminous files.⁶ Nothing in the record suggests that the possibility of making a less than complete search was explored.⁷

On this record we cannot sustain the trial court's holding that the subpoena is oppressive and burdensome. The District Court should explore the matter fully in an effort to accommodate the interests of the defendants and then consider whether this subpoena is so oppressive that it cannot be granted, even in a modified form.⁸ Perhaps a partial search could be attempted to determine how productive and how onerous a search of the complete file would be. The two brief affidavits filed by the Government, after the hearing on the motion to quash, were insufficient to establish that the subpoena was unreasonably burdensome and oppressive.

The fact that these are very important cases with large sums of money at stake is relevant in determining the reasonableness of the subpoena. Even though the subpoena is addressed to a non-party, inconvenience occasioned by compliance with the subpoena is not a sufficient reason to quash. Cf. Pathe Laboratories, Inc. v. Du Pont Film Mfg. Corp., 3 F.R.D. 11 (S.D.N.Y.1943); 5 MOORE ¶ 45.05 2....