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Antitrust - Procedures and Penalties Act
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Antitrust - Procedures and Penalties Act
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The original documents are located in Box 68, folder "Antitrust - Procedures and Penalties
Act of the Edward Hutchinson Papers at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 68 of The Edward Hutchinson Papers at the Gerald R. Ford Presidential Library
Amendment to Amendment No. 1
Strike the third paragraph of the amendment and insert
in lieu thereof the following:
On page 3, line 14, strike "and evaluation".
DJ position: delete from Sec. 2(e)2 the phrase "including consideration of the public benefit to be derived from a determination
of the issues at trial" as Senate floor-amendment did.
PRO
CON
1. Only private treble damage plaintiffs can be aided.
1. Contradicts Subcomm. Amend. No. 4: Hearings in both
Senate and House concluded the necessity for this provision.
2. An invitation for district courts to put on a show.
2. Sec. 2(h) making proceedings under bill inadmissible
2. DJ may be burdened.
evidence defuses any fears that treble damage plaintiffs will
use.
3. In any event, DJ has not expertise: the section is one
of two dealing with courts and designed to cure abuse of
judicial rubber stamping.
4. A main support for Part 1 of bill is that the nublic does
have an interest in settlements; and, in the integrity of
procedures related thereto.
5. The section is an exercise of legislative oversight on
judicial operations - not executive branch functions.
6. Mr. Wilson, at hearings (p. 72), recognized that there are
no members of public who merely seek delays of settlements for
delay purposes only.
7. A question of judicial-legislative separation of nowers
issue is involved: entry of a proposal is a judicial act:
however, legislative guidelines are appropriate.
8. Courts cannot compel entry of decrees if DJ resists: con-
verse is true also.
9. Case law supports public issues: LTV (1970); Blue Chip
(1967); Nader V. U.S. (1973); E1 Paso Gas (1970) (also shows
supervisory powers of courts are over courts are directly
involved).
10. Any conceivable burdening that can be specified, easily
outweighed if a balancing test is proper.
DJ position: Delete Subcomm. Amend. No. 5 and restore Senate version.
PRO
CON
1. A compromise worked out on Senate floor.
1. Sen. and House Subcomm. witnesses were unanimous on this
point except DJ.
2. Valuable information is elicited from corporate
officials who accompany counsel of record by top
2. Both Subcomm. mark-ups included this provision.
Antitrust Division personnel which may be chilled
if such contacts are reported.
3. Owens amendment shows the Subcomm. has not gone far
enough (rejects DJ "too far" position).
4. "Lawyering" can be distinguished from lobbying.
5. Abuses are sought to be remedied; DJ does not even admit
abuses and, therefore, have no internal policy changes to support
their position.
6. Disclosure of contacts only is required; not substance:
"chilling" argument makes no sense.
7. Sponsors want "sunlight" and "courtrooms" substituted for
"backrooms" in any event.
8. Ex-DJ attorneys complained bitterly that (a) Top Division
officials interfere with litigation or (b) the "helpful"
information is really no "help" to issues involved in cases
and, in any event, never get passed to trial/staff personnel
until a fait accompli occurs.
DJ position: Repeal direct review of litigated cases SO that (a) Supreme Court jurisdiction is changed from obligatory jurisdiction
to discretionary; (b) provide AG with power to certify important cases for direct review which, if Supreme Court agrees, will provide
direct review in some cases; (c) route all litigated cases through circuit courts unless AG exercises his certification power.
PRO
CON
1. Some cases are not being appealed because they are not
1. Legislation is redundant therefore: this is the definition
significant enough to bother Supreme Court.
of the Solicitor General and explains the Court's deference to
cases he files; moreover, no real case was ever cited by DJ -
only hypotheticals.
2. Routing cases through circuit courts will create jurisdic-
tional splits as already has happened in private cases increas-
ing circuit and Supreme Court workloads.
3. Certiorari provides no rule of law and huge waste may be
involved.
4. DJ never provided arguments for repeal in the first instance
and admit their citation of history was erroneous: Since 1903,
the comprehensive Judiciary Act of 1925; the 1928 Frankfurter
& Landis study; and the 1974 Casper & Posner study - all were
not considered or, even cited by them.
5. Only 10% of S.Ct's docket is obligatory jurisdiction and
antitrust is at most 0.2%.
6. Modern antitrust litigation expands and protracts discovery
phases and by definition refines issues - post-trial ought to
be expedited rather than protracted.
7. Congress assumes and DJ ordinarily argues, it does not
bring frivolous cases: if one or two slip in, arquendo, this
does not support repeal or DJ position.
8. Legal and social national policy as well as economic and
antitrust are unified in Supreme Court.
Page 2.
2. Present Supreme Court is hostile to Government cases;
9. Legislation is based on principles not personalities;
summary dispositions are increasing.
recent losses with opinions criticize DJ directly.
10. Only 2 Justices announce hostility; 2 or more announce
the opposite.
11. Summary dispositions give a rule of law and do not take
much Court time: 14% of S. Ct. time is for review of 3,700
cases. Antitrust is less than 8 and usually 5 at this stage
with only 2.2 on annual average surviving for argument.
12. Those Justices expressing hostility rely on the Freund
Report which, to the extent not totally discredited is highly
controversial and legislation for a Commission has been
introduced.
13. The "certainty" businessmen rely on is in rules of law
at Supreme Court level.
14. Modern economic structure argues more for national rules
of law than promotion of different, and regional/local rules
of law.
15. Forum shopping at its worst.
3. Defendants in Government cases do not need a certif-
16. Inequitable in essence.
ication power; the AG has a responsibility private
parties do not have.
17. Private cases already provide national issues and national
rules of law; the growth of private antitrust in experience
and sophistication allows private parties to recognize issues
important to an industry or to the public.
18. Recent history confirms abuses of present responsibility
for which it is illogical to ask for greater responsibility.
Page 3
19. The national enforcement policies are matched by
business' having national and international operations for
which they need certainty and uniformity in law.
4. Such post-trial discretion will aid more vigorous
20. Enforcement usually means pre-trial and trial not
enforcement.
appeals.
21. So few cases are actually tried, the argument is, at best,
de minimis.
22. The argument is superfluous: the AG-Solicitor General are
not required to file an appeal in everv case the Government
loses; moreover, as in all trials, some cases should not have
been tried in any event and should not be appealed.
23. A grant of specific discretionary power by the Congress
entails major changes in areas of law other than antitrust law;
DJ has not even discussed this - nor have Senate or House
hearings although staff memoranda have discussed.
5. Prospective Senate conferees support DJ.
24. Misleading: Senate conferees have "no objection" to
House work on Part 3 of bill; Senate focus was on Parts 1 and
2.
25. Inaccurate: inferences of literal statements of "no
objection" are a recognition of House complementing Senate work.
(Overall)
26. DJ amendment was rejected by Senate Antitrust Subcomm. and
by Sen. floor leaders.
27. The lobbying has been 11th hour and unsupported except by
a request for confidence in DJ personnel.
S. 782 ANALYSIS
The Antitrust Procedures and Penalties Act, S. 782, has three unrelated
main sections: the first section has seven subsections; the second, one;
and the third, five. At the conclusion of its mark-up, the Monopolies and
Commercial Law Subcommittee struck all after the enacting clause of S. 782
and substituted the bill it had considered, H.R. 9203. At that time, the
Subcommittee's version of S. 782 differed from the Senate-passed version
of S. 782 by, essentially, six substantive amendments and numerous technical
and conforming amendments.
At an informal meeting of the Monopolies Subcommittee on October 3, 1974,
by unanimous agreement of 9 Subcommittee Members (7 present and 2 by message),
it was decided to introduce a "clean bill" that would differ in two main
respects from the Subcommittee's previous work, both of which changes were
supported by the Justice Department and by prospective Senate conferees and
eliminated two differences with the Senate-passed bill: H.R. 17063 is that
"clean bill". By unanimous consent of the Judiciary Committee, all text
after the enacting clause of S. 782 will be struck and H.R. 17063 substituted
therefor.
PURPOSE OF THE BILL
The first section requires the filing of an impact statement for each
proposal for a consent judgment (Sec. 2(b)); and, provides mechanisms for
notifying the public of the filing of such proposals (Sec. 2(c)) and, for
submission of public comment and responses thereto by the Justice Department,
(Sec. 2(d)). Thereupon, district courts are required to determine that the
proposal is in the public interest with legislative and oversight guidelines
- 2 -
for the exercise of judicial discretion provided (Sec. 2(e) and (f)).
Defendants are required to disclose lobbying contacts known or that should
reasonably have been known as occurring in connection with a case resulting
in a proposal for a consent judgment (Sec. 2(g)); "lawyering" contacts are
excluded from disclosure. Impact statements filed and proceedings occurring
in connection with the bill are inadmissible as evidence against defendants
in private antitrust actions; and, present law denying prima facie evidentiary
effect to consent judgments is preserved (Sec. 2(h)).
The second section of the bill seeks to increase maximum fines for
criminal violations of the Sherman Act from $50,000 to $500,000 for corporations
and $100,000 for other persons.
The third section of the bill amends the Expediting Act to: (1) facil-
itate and speed up antitrust trials following filing of a case; (2) provide
intermediate appellate review of pre-trial denials of preliminary injunctions
in merger cases; and (3) repeal present law providing Supreme Court direct
review of litigated cases, merger and non-merger cases alike, but enacting
a savings provision whereby direct Supreme Court review may be available in
some cases. The bill also would eliminate the reference in existing law to
measure for expediting civil cases brought by the United States under the
original Interstate Commerce Act and the Communications Act.
STATEMENT CONCERNING S. 782 FOR FULL COMMITTEE MEETING - OCTOBER 8, 1974
The Subcommittee on Monopolies and Commercial Law this morning reports
favorably on important new antitrust legislation, the Antitrust Procedures
and Penalties Act, S. 782, that passed the Senate unanimously by a 92-0 vote.
The Act was the subject of intense legislative and oversight study by
the Monopolies Subcommittee since not only is new legislation presented but
also remedies for abuses. in consent decree procedures that have been criticized
for a long time and which began in a 1959 Monopolies Subcommittee Report. The
Subcommittee held 4 days of hearings during which more than 200 pages of
testimony were received from distinguished representatives from the public
and private antitrust bars. The Subcommittee also believes that enactment
of the proposed measure would be a giant step forward in restoring public
confidence in the impartial execution of the antitrust laws.
As the Subcommittee observed in 1959, "The consent decree practice has
established an orbit in the twilight zone between established rules of
administrative law and judicial procedures." The first part of the bill,
therefore, requires the filing of an impact statement explaining proposed
consent decrees along with requirements for public notice; requires district
courts to determine that proposals are in the public interest and provides
legislative guidelines for the exercise of judicial discretion; and, requires
the publication of lobbying contacts made with the Justice Department in the
course of the formulation of consent decrees.
The second part of the bill would increase fines for Sherman Act offenses
from 350, to $500,000 for corporations and $100,00 for individuals and
- 2 -
non-corporate business enterprises. It as in 1955, that these fines were
raised from $5,000 to $50,000 and revisions upward on fine ceilings are
long overdue. The need for effective deterrents to antitrust violations
has not been disputed before the Subcommittee or, for that matter, in the
Senate. Current events increase this need for effective deterrents since
one FTC Commissioner recently estimated that unlawful price-fixing currently
adds $10 billion annually to prices paid by consumers; and, the Assistant
Attorney General for Antitrust observed that "vigorous enforcement" of the
antitrust laws is the "true anti-inflationary road" to follow.
The third part of the bill is innovative providing measures to reduce
time from filing to trial in civil cases; and, providing appellate review
of district court pre-trial orders relating to preliminary injuctions in
Terger cases. This latter provision is expected to have the added benefit
of reducing acpeals to the Supreme Court following litimation.
In addition, present procedures for judicial review of litigated civil
cases is altered: (1) Supreme Court discretionary review jurisdiction is sub-
stituted for present obligatory jurisdiction; and (2) post-trial review will
lie to Circuit Courts rather than directly to the Supreme Court unless the
Attorney General certifies that the case is one that ought to receive Supreme
Court review directly. Certification by the Attorney General merely provides
an opportunity for direct Supreme Court review since the legislation confers
control of the Supreme Court's docket on that Court and allows it, upon
certification, nevertheless to refer the case to the appropriate Circuit Court.
The Monopolies Subcommittee labored long and diligently on this provision and I
am confident that all arguments pro and con were effectively raised and fairly
considered.
S. 782 ANALYSIS
The Antitrust Procedures and Penalties Act, S. 782, has three un-
related main sections: the first section has seven sub-sections; the
second, one; and the third, five. With the exception of numerous
"technical and conforming" amendments that will be offered en bloc, the
Subcommittee has five amendments to the first section; no amendments to
the second part; and, an amendment deleting two of the five sub-sections
in the third part.
PURPOSE OF AMENDMENTS
Amendment No. 1 requires the impact statement accompanying a proposal
for a consent judgment to include an explanation of the anticipated effects
on competition of alternatives to settlement by a consent decree foregone.
Alternatives are considered and the bill requires a description of them.
However, since each alternative presumptively had different competitive
effects that have been outweighed, it is reasonable to expect that the choice
of a consent decree could be explained in competitive terms without difficulty
since such choice was or ought to have been integral to the decision in the
first instance. More importantly, a basis for comparing competitive effects
foregone with those expected to be achieved by a consent decree is essential
if a court is to determine that the proposal is in the public interest; and,
if meaningful public comment is to be elicited and considered. Without
Amendment No. 1, in addition, the impact statement's contents amount to little
-ore than legislation of Antitrust Division press releases and abuses sought
:) be corrected would remain remediless. Deletion of references to the
Freedom of Information Act is intended to insure that except for disclosure
- 2 -
required in the bill, FOIA case law, substantive and procedural, is not
disturbed.
Amendment No. 2 re-labels the impact statement as a "comoetitive impact
statement" in order to clarify the intent to distinguish impact statements
required under environmental laws; and, emphasize that, since the antitrust
laws are designed to promote and to protect competition, the expertise that
the Congress has charged the Antitrust Division with acquiring and institu-
tionalizing actuated and embodied in consent decree proposals is accessible
and subject to scrutiny by the courts and the public.
Amendment No. 3 consists of a four-word deletion that recognizes that
the "public interest" is not defined in legal dictionaries, encyclopedias,
or statutes. More importantly, the Subcommittee did not intend to change
case law construing the "public interest" in cases involving the antitrust
laws or antitrust provisions of other laws.
Amendment No. 4 expands legislative guidelines for matters placed within
a district court's discretion in making a mandated determination that the
proposal for a consent judgment is in the public interest. Testimony substan-
tiating widespread criticism of district courts' merely acting as rubber
stamps in the consent decree process identified the lack of clear legislative
intent as an explanation of judicial inertia and inaction. The amendment is
necessary both to correct the abuse of rubber stamping and to restore public
confidence in the integrity of judicial procedures. Entry of a proposed
consent decree is a judicial act and an exercise of judicial power. The amend-
ment also expresses the fruits of legislative oversight activity and increases,
therefore, the propriety of legislative guidelines for the exercise of judicial
- 3 -
discretion. The permissive legislation of the sub-section amended is legis-
lative acknowledgment of and deference to the judicial nature of the entry
of consent decree proposals as court judgments. Finally, the amendment ex-
presses the legislative intention of not changing case law developments that
the Justice Department cannot compel courts to enter proposed consent decrees
as judgments; nor can courts compel the Justice Department to enter into
settlements unless it so desires.
Amendment No. 5 is intended to close loopholes in the reporting of
lobbying contacts made by defendants with the Attorney General or members of
the Antitrust Division in connection with cases subsequently settled by a
consent decree either pre-trial or post-trial. Contacts by counsel of record
alone are exempted as a balancing of "lawyering" contacts with the difficulties
of legislating legal ethics confining contacts by counsel of record alone to
lawyering and not lobbying.
Amendment No. 6 deletes the repeal of present law governing judicial
review procedures for litigated cases contemplated by the bill. A major change
in antitrust policy would be effectuated by a repeal of present law. Testimony
in support of repealing present law did not outweigh the reasons leading to
enactment of present law and long acquiescence therein by the many Congresses
since. If the passage of time has done anything, it has increased the impor-
tance of the critical unifying role played by the Supreme Court in the recon-
ciliation of the national legal, economic, and social policies expressed in
the antitrust laws, the "referee" of the free enterprise system; and, given
the development of discovery and other extensive, time-consuming pre-trial
procedures in antitrust litination, present time periods in obtaining definitive
- 4 -
rulings on national issues ought to be reduced rather than protracted.
Moreover, testimony in support of repeal was, mainly, expression of support
for establishment of a mini-Supreme Court because of overburdening of the
Supreme Court. To the extent that the arguments of the mini-Supreme Court
advocates were entitled to weight in antitrust law, they were amply rebutted
by quantitative and qualitative analyses of their positions.
PURPOSE OF THE BILL
The first section requires the filing of an impact statement for each
proposal for a consent judgment (Sec. 2(b)); and, provides mechanisms for
notifying the public of the filing of such proposals (Sec. 2(c)) and, for
submission of public comment and responses thereto by the Justice Department,
(Sec. 2(d)). Thereupon, district courts are required to determine that the
proposal is in the public interest with legislative and oversight quidelines
for the exercise of judicial discretion provided (Sec. 2(e) and (f)).
Defendants are required to disclose lobbying contacts known or that should
reasonably have been known as occurring in connection with a case resulting
in a proposal for a consent judgment (Sec. 2(g)); "lawyering" contacts are
excluded from disclosure. Impact statements filed and proceedings occurring
in connection with the bill are inadmissible as evidence against defendants
in private antitrust actions; and, present law denying prima facie evidentiary
effect to consent judgments is preserved (Sec. 2(h)).
The second section of the bill seeks to increase maximum fines for
criminal violations of the Sherman Act from $50,000 to $500,000 for corporations
=-- $100,000 for other persons.
- 5 -
The third section of the bill amends the Expediting Act to: (1) facil-
itate and speed up antitrust trials following filing of a case; (2) provide
intermediate appellate review of pre-trial denials of preliminary injunctions
in merger cases; and (3) repeal present law providing Supreme Court direct
review of litigated cases, merger and non-merger cases alike, but enacting
a three-step savings provision whereby direct Supreme Court review may be
available in some cases. The bill also would eliminate the reference in
existing law to measures for expediting civil cases brought by the United
States under the original Interstate Commerce Act and the Communications
Act.
93D CONGRESS
1ST SESSION
H. R. 9203
IN THE HOUSE OF REPRESENTATIVES
JULY 11, 1973
Mr. RODINO introduced the following bill; which was referred to the Com-
mittee on the Judiciary
A BILL
To reform consent decree procedures, to increase penalties for
violation of the Sherman Act, and to revise the expediting
Act as it pertains to appellate review.
1
Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 That this Act may be cited as the "Antitrust Procedures and
4 Penalties Act".
5
CONSENT DECREE PROCEDURES
6
SEC. 2. Section 5 of the Act entitled "An Act to supple-
7 ment existing laws against unlawful restraints and monopo-
8 lies, and for other purposes", approved October 15, 1914
9 (38 Stat. 730; 15 U.S.C. 16), is amended by redesignating
I
2
3
1 subsection (b) as (i) and by inserting after subsection (a)
1
rise to the alleged violation of the antitrust laws;
2 the following:
2
" (3) an explanation of the proposed judgment, relief
3
" (b) Any consent judgment proposed by the United
3
to be obtained thereby, and the anticipated effects on
4 States for entry in any civil proceeding brought by or on
4
competition of that relief, including an explanation of any
5 behalf of the United States under the antitrust laws shall be
5
unusual circumstances giving rise to the proposed judg-
6 filed with the district court before which that proceeding is
6
ment or any provision contained therein;
7 pending and published in the Federal Register at least sixty
7
" (4) the remedies available to potential private
8 days prior to the effective date of such decree. Any written
8
plaintiffs damaged by the alleged violation in the event
9 comments relating to the proposed consent judgment and any
9
that the proposed judgment is entered;
10 responses thereto shall also be filed with the same district
10
" (5) a description of the procedures available for
11 court and published in the Federal Register within the afore-
11
modification of the proposed judgment;
12 mentioned sixty-day period. Copies of the proposed consent
12
" (6) a description and evaluation of alternatives
13 judgment and such other materials and documents which the
13
actually considered to the proposed judgment and the
14 United States considered determinative in formulating the
14
anticipated effects on competition of such alternatives.
15 proposed consent judgment shall also be made available to
15
" (c) The United States shall also cause to be published,
16 members of the public at the district court before which the
16 commencing at least sixty days prior to the effective date of
17 proceeding is pending and in such other districts as the court
17 such decree, for seven days over a period of two weeks in
18 may subsequently direct. Simultaneously with the filing of
18 newspapers of general circulation of the district in which the
19 the proposed consent judgment, unless otherwise instructed
19 case has been filed, in Washington, District of Columbia, and
20 by the court, the United States shall file with the district
20 in such other districts as the court may direct (i) a summary
21 court, cause to be published in the Federal Register, and
21 of the terms of the proposed consent judgment, (ii) a sum-
22 thereafter furnish to any person upon request a public impact
22 mary of the public impact statement to be filed under subsec-
23 statement which shall recite-
23 tion (b) (iii) and a list of the materials and documents
24
" (1) the nature and purpose of the proceeding;
24 under subsection (b) which the United States shall make
25
" (2) a description of the practices or events giving
25 available for purposes of meaningful public comment, and the
5
4
1
1 places where such material is available for public inspection.
" (2) the public impact of entry of the judgment
2
2
" (d) During the sixty-day period provided above, and
upon the public generally and individuals alleging spe-
3
3 such additional time as the United States may request and
cific injury from the violations set forth in the complaint,
4
4 the court may grant, the United States shall receive and
including consideration of the public benefit to be de-
5
rived from a determination of the issues at trial.
5 consider any written comments relating to the proposed con-
6
6 sent judgment. The Attorney General or his designate shall
" (f) In making its determination under subsection (e),
7 establish procedures to carry out the provisions of this subsec-
7 the court may-
8
8 tion, but the sixty-day time period set forth herein shall not
(1) take testimony of Government officials or ex-
9
9 be shortened except by order of the district court upon a
perts or such other expert witnesses, upon motion of
10
10 showing that extraordinary circumstances require such
any party or participant or upon its own motion, as
11
11 shortening and that such shortening of the time period is not
the court may deem appropriate;
12
12 adverse to the public interest. At the close of the period
" (2) appoint a special master, pursuant to rule
13
13 during which such comments may be received, the United
53 of the Federal Rules of Civil Procedure, and such
14 States shall file with the district court and cause to be pub-
14
outside consultants or expert witnesses as the court
15 lished in the Federal Register a response to such comments.
15
may deem appropriate; and request and obtain the
16
16
" (e) Before entering any consent judgment proposed
views, evaluations, or advice of any individual group
17
17
by the United States under this section, the court shall
or agency of government with respect to any aspect
18 determine that entry of that judgment is in the public
18
of the proposed judgment of the effect thereof in such
19 interest as defined by law. For the purpose of this determina-
19
manner as the court deems appropriate;
20
20
tion, the court may consider-
" (3) authorize full or limited participation in pro-
21
21
(1) the public impact of the judgment, including
ceedings before the court by interested persons or agen-
22
termination of alleged violation, provisions for enforce-
22
cies, including appearance amicus curiae, intervention
23
ment and modification, duration of relief sought, antici-
23
as a party pursuant to rule 24 of the Federal Rules
24
pated effects of alternative remedies actually considered,
24
of Civil Procedure, examination of witnesses or docu-
25
and any other considerations bearing upon the adequacy
25
mentary materials, or participation in any other manner
26
H.R. 9203-2
of the judgment;
6
7
1
and extent which serves the public interest as the court
1 defendant in any action or proceeding brought by any other
2
may deem appropriate;
2 party against such defendant under the antitrust laws or by
3
" (4) review any comments or objections concern-
3 the United States under section 4A of this Act nor constitute
4
ing the proposed judgment filed with the United States
4 a basis for the introduction of the consent judgment as prima
5
under subsection (d) and the response of the United
5 facie evidence against such defendant in any such action or
6
States to such comments or objections;
6 proceeding."
7
" (5) take such other action in the public interest
7
PENALTIES
8
as the court may deem appropriate.
8
SEC. 3. Sections 1, 2, and 3 of the Act entitled "An Act
9
" (g) Not later than ten days following the filing of any
9 to protect trade and commerce against unlawful restraints
10 proposed consent judgment under subsection (b), each de-
10 and monopolies", approved July 2, 1890 (26 Stat. 209; 15
11 fendant shall file with the district court a description of
11 U.S.C. 1, 2, and 3) are each amended by striking out "fifty
12 any and all written or oral communications by or on behalf
12 thousand dollars" and inserting "five hundred thousand dol-
13 of such defendant, including any officer, director, employee,
13 lars if a corporation, or, if any other person, one hundred
14 or agent thereof, or other person except counsel of record,
14 thousand dollars".
15 with any officer or employee of the United States concern-
15
EXPEDITING ACT REVISIONS
16 ing or relevant to the proposed consent judgment. Prior
16
SEC. 4. Section 1 of the Act of February 11, 1903 (32
17 to the entry of any consent judgment pursuant to the anti-
17 Stat. 823), as amended (15 U.S.C. 28; 49 U.S.C. 44),
18 trust laws, each defendant shall certify to the district court
18 commonly known as the Expediting Act, is amended to read
19 that the requirements of this section have been complied
19 as follows:
20 with and that such filing is a true and complete description
20
"SECTION 1. In any civil action brought in any district
21 of such communications known to the defendant or which the
21 court of the United States under the Act entitled 'An Act
22 defendant reasonably should have known.
22 to protect trade and commerce against unlawful restraints
23
" (h) Proceedings before the district court under subsec-
23 and monopolies', approved July 2, 1890, or any other Acts
24 tions (e) and (f), and public impact statements filed under
24 having like purpose that have been or hereafter may be
25 subsection (b) hereof, shall not be admissible against any
25 enacted, wherein the United States is plaintiff and equitable
8
9
1 relief is sought, the Attorney General may file with the
1 to review by the Supreme Court upon a writ of certiorari as
2 court, prior to the entry of final judgment, a certificate that,
2 provided in section 1254 (1) of title 28 of the United States
3 in his opinion, the case is of a general public importance.
3 Code.
4 Upon filing of such certificate, it shall be the duty of the
4
" (b) An appeal from a final judgment pursuant to
5 judge designated to hear and determine the case, or the chief
5 subsection (a) shall lie directly to the Supreme Court if-
6 judge of the district court if no judge has as yet been desig-
6
" (1) upon application of a party filed within five
7 nated, to assign the case for hearing at the earliest practicable
7
days of the filing of a notice of appeal, the district judge
8 date and to cause the case to be in every way expedited."
8
who adjudicated the case enters an order stating that
9
SEC. 5. Section 2 of the Act (15 U.S.C. 29; 49 U.S.C.
9
immediate consideration of the appeal by the Supreme
10 45) is amended to read as follows:
10
Court is of general public importance in the adminis-
11
" (a) Except as otherwise expressly provided by this
11
tration of justice.
12 section, in every civil action brought in any district court
12 A court order pursuant to (1) must be filed within
13 of the United States under the Act entitled 'An Act to pro-
13 fifteen days after the filing of a notice of appeal. When such
14 tect trade and commerce against unlawful restraints and
14 an order or certificate is filed, the appeal and any cross appeal
15 monopolies', approved July 2, 1890, or any other Acts hav-
15 shall be docketed in the time and manner prescribed by the
16 ing like purpose that have been or hereafter may be enacted,
16 rules of the Supreme Court. That Court shall thereupon
17 in which the United States is the complainant and equitable
17 either (1) dispose of the appeal and any cross appeal in
18 relief is sought, any appeal from a final judgment entered
18 the same manner as any other direct appeal authorized by
19 in any such action shall be taken to the court of appeals
19 law, or (2) in its discretion, deny the direct appeal and
20 pursuant to sections 1291 and 2107 of title 28 of the United
20 remand the case to the court of appeals, which shall then
21 States Code. Any appeal from an interlocutory order entered
21 have jurisdiction to hear and determine the same as if the
22 in any such action shall be taken to the court of appeals pur-
22 appeal and any cross appeal therein had been docketed in
23 suant to section 1292 (a) (1) and 2107 of title 28 of the
23 the court of appeals in the first instance pursuant to sub-
24 United States Code but not otherwise. Any judgment entered
24 section (a)
25 by the court of appeals in any such action shall be subject
25
SEC. 6. (a) Section 401 (d) of the Communications
10
1 Act of 1934 (47 U.S.C. 401 (d) ) is repealed.
2
(b) The proviso in section 3 of the Act of February
3 19, 1903, as amended (32 Stat. 848, 849; 49 U.S.C. 43),
4 is repealed and the colon preceding it is changed to a
5 period.
6
SEC. 7. The amendment made by section 2 of this Act
7 shall not apply to an action in which a notice of appeal to
8 the Supreme Court has been filed on or before the fifteenth
9 day following the date of enactment of this Act. Appeal in
10 any such action shall be taken pursuant to the provisions
11 of section 2 of the Act of February 11, 1903 (32 Stat. 823), ,
12 as amended (15 U.S.C. 29; 49 U.S.C. 45) which were in
13 effect on the day preceding the date of enactment of this Act.
93D CONGRESS
1ST SESSION
H. R. 9203
A BILL
To reform consent decree procedures, to in-
crease penalties for violation of the Sher-
man Act, and to revise the expediting Act
as it pertains to appellate review.
By Mr. RODINO
JULY 11, 1973
Referred to the Committee on the Judiciary
93D CONGRESS
1ST SESSION
S. 782
IN THE HOUSE OF REPRESENTATIVES
JULY 23, 1973
Referred to the Committee on the Judiciary
AN ACT
To reform consent decree procedures, to increase penalties for
violation of the Sherman Act, and to revise the Expediting
Act as it pertains to Appellate Review.
1
Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 That this Act may be cited as the "Antitrust Procedures and
4 Penalties Act".
5
CONSENT DECREE PROCEDURES
6
SEC. 2. Section 5 of the Act entitled "An Act to supple-
7 ment existing laws against unlawful restraints and monopo-
8 lies, and for other purposes", approved October 15, 1914
9 (38 Stat. 730; 15 U.S.C. 16), is amended by redesignating
I
2
3
1 subsection (b) as (i) and by inserting after subsection
1 furnish to any person upon request a public impact statement
2 (a) the following:
2 which shall recite-
3
" (b) Any consent judgment proposed by the United
3
" (1) the nature and purpose of the proceeding;
4 States for entry in any civil proceeding brought by or on
4
" (2) a description of the practices or events giving
5 behalf of the United States under the antitrust laws shall be
5
rise to the alleged violation of the antitrust laws;
6 filed with the district court before which that proceeding is
6
" (3) an explanation of the proposed judgment, relief
7 pending and published in the Federal Register at least sixty
7
to be obtained thereby, and the anticipated effects on
8 days prior to the effective date of such decree. Any written
8
competition of that relief, including an explanation of
9 comments relating to the proposed consent judgment and any
9
any unusual circumstances giving rise to the proposed
10 responses thereto, other than those which are exempt from
10
judgment or any provision contained therein;
11 disclosure under section 552 (b) of title 5, United States
11
" (4) the remedies available to potential private
12 Code, shall also be filed with the same district court and
12
plaintiffs damaged by the alleged violation in the event
13 published in the Federal Register within the aforementioned
13
that the proposed judgment is entered;
14 sixty-day period. Copies of the proposed consent judgment
14
" (5) a description of the procedures available for
15 and such other materials and documents which the United
15
modification of the proposed judgment;
16 States considered determinative in formulating the proposed
16
" (6) a description and evaluation of alternatives
17 consent judgment, other than those which are exempt from
17
actually considered to the proposed judgment.
18 disclosure under sections 552 (b) (4) and (5) of title 5,
18
" (c) The United States shall also cause to be published,
19 United States Code, shall also be made available to members
19 commencing at least sixty days prior to the effective date of
20 of the public at the district court before which the preceding
20 such decree, for seven days over a period of two weeks in
21 is pending and in such other districts as the court may sub-
21 newspapers of general circulation of the district in which the
22 sequently direct. Simultaneously with the filing of the pro-
22 case has been filed, in Washington, District of Columbia, and
23 posed consent judgment, unless otherwise instructed by the
23 in such other districts as the court may direct (i) a summary
24 court, the United States shall file with the district court,
24 of the terms of the proposed consent judgment, (ii) a sum-
25 cause to be published in the Federal Register and thereafter
4
5
1 mary of the public impact statement to be filed under sub-
1 interest as defined by law. For the purpose of this deter-
2 section (b) (iii) and a list of the materials and documents
2 mination, the court may consider-
3 under subsection (b) which the United. States shall make
3
" (1) the public impact of the judgment, including
4 available for purposes of meaningful public comment, and
4
termination of alleged violation, provisions for enforce-
5 the places where such material is available for public inspec-
5
ment and modification, duration of relief sought, antici-
6 tion.
6
pated effects of alternative remedies actually considered,
7
" (d) during the sixty-day period provided above, and
7
and any other considerations bearing upon the adequacy
8 such additional time as the United States may request and
8
of the judgment;
9 the court may grant, the United States shall receive and
9
" (2) the public impact of entry of the judgment
10 consider any written comments relating to the proposed
10
upon the public generally and individuals alleging spe-
11 consent judgment. The Attorney General or his designate
11
cific injury from the violations set forth in the complaint.
12 shall establish procedures to carry out the provisions of this
12
" (f) In making its determination under subsection (e),
13 subsection, but the sixty-day time period set forth herein
13 the court may-
14 shall not be shortened except by order of the district court
14
" (1) take testimony of Government officials or ex-
15 upon a showing that extraordinary circumstances require
15
perts or such other expert witnesses, upon motion of
16 such shortening and that such shortening of the time period
16
any party or participant or upon its own motion, as
17 is not adverse to the public interest. At the close of the
17
the court may deem appropriate;
18 period during which such comments may be received, the
18
" (2) appoint a special master, pursuant to rule
19 United States shall file with the district court and cause to
19
53 of the Federal Rules of Civil Procedure, and such
20 be published in the Federal Register a response to such
20
outside consultants or expert witnesses as the court
21 comments.
21
may deem appropriate; and request and obtain the
22
" (e) Before entering any consent judgment proposed
22
views, evaluations, or advice of any individual group
23 by the United States under this section, the court shall
23
or agency of government with respect to any aspect
24 determine that entry of that judgment is in the public
S. 782-2
6
7
1
of the proposed judgment of the effect thereof in such
1 General or the employees of the Department of Justice shall
2
manner as the court deems appropriate;
2 be excluded from the requirements of this subsection. Prior
3
" (3) authorize full or limited participation in pro-
3 to the entry of any consent judgment pursuant to the anti-
4
ceedings before the court by interested persons or agen-
4 trust laws, each defendant shall certify to the district court
5
cies, including appearance amicus curiae, intervention
5 that the requirements of this section have been complied
6
as a party pursuant to rule 24 of the Federal Rules
6 with and that such filing is a true and complete description
7
of Civil Procedure, examination of witnesses or docu-
7 of such communications known to the defendant or which the
8
mentary materials, or participation in any other manner
8 defendant reasonably should have known.
9
and extent which serves the public interest as the court
9
" (h) Proceedings before the district court under subsec-
10
may deem appropriate;
10 tions (e) and (f), and public impact statements filed under
11
" (4) review any comments or objections concern-
11 subsection (b) hereof, shall not be admissible against any de-
12
ing the proposed judgment filed with the United States
12 fendant in any action or proceeding brought by any other
13
under subsection (d) and the response of the United
13 party against such defendant under the antitrust laws or by
14
States to such comments or objections;
14 the United States under section 4A of this Act nor constitute
15
" (5) take such other action in the public interest
15 a basis for the introduction of the consent judgment as prima
16
as the court may deem appropriate.
16 facie evidence against such defendant in any such action or
17
" (g) Not later than ten days following the filing of
17 proceeding."
18 any proposed consent judgment under subsection (b), each
18
PENALTIES
19 defendant shall file with the district court a description of
19
SEC. 3. Sections 1, 2, and 3 of the Act entitled "An Act
20 any and all written or oral communications by or on behalf
20 to protect trade and commerce against unlawful restraints
21 of such defendant, including any officer, director, employee,
21 and monopolies", approved July 2, 1890 (26 Stat. 209;
22 or agent thereof, or other person with any officer or employee
22 15 U.S.C. 1, 2, and 3) are each amended by striking out
23 of the United States concerning or relevant to the proposed
23 "fifty thousand dollars" and inserting "five hundred thousand
24 consent judgment: Provided, That communications made
24 dollars if a corporation, or, if any other person, one hundred
25 by or in the presence of counsel of record with the Attorney
25 thousand dollars".
8
9
1
EXPEDITING ACT REVISIONS
1 monopolies', approved July 2, 1890, or any other Acts hav-
2
SEC. 4. Section 1 of the Act of February 11, 1903 (32
2 ing like purpose that have been or hereafter may be enacted,
3 Stat. 823), as amended (15 U.S.C. 28; 49 U.S.C. 44),
3 in which the United States is the complainant and equitable
4. commonly known as the Expediting Act, is amended to read
4 relief is sought, any appeal from a final judgment entered in
5 as follows:
5 any such action shall be taken to the court of appeals pur-
6
"SECTION 1. In any civil action brought in any district
6 suant to sections 1291 and 2107 of title 28 of the United
7 court of the United States under the Act entitled 'An Act
7 States Code. Any appeal from an interlocutory order entered
8 to protect trade and commerce against unlawful restraints
8 in any such action shall be taken to the court of appeals pur-
9 and monopolies', approved July 2, 1890, or any other Acts
9 suant to sections 1292 (a) (1) and 2107 of title 28 of the
10 having like purpose that have been or hereafter may be
10 United States Code but not otherwise. Any judgment entered
11 enacted, wherein the United States is plaintiff and equitable
11 by the court of appeals in any such action shall be subject
12 relief is sought, the Attorney General may file with the
12 to review by the Supreme Court upon a writ of certiorari
13 court, prior to the entry of final judgment, a certificate that,
13 as provided in section 1254 (1) of title 28 of the United
14 in his opinion, the case is of a general public importance.
14 States Code.
15 Upon filing of such certificate, it shall be the duty of the
15
" (b) An appeal from a final judgment pursuant to
16 judge designated to hear and determine the case, or the chief
16 subsection (a) shall lie directly to the Supreme Court if,
17 judge of the district court if no judge has as yet been desig-
17 upon application of a party filed within fifteen days of the
18 nated, to assign the case for hearing at the earliest practicable
18 filing of a notice of appeal, the district judge who adjudi-
19 date and to cause the case to be in every way expedited."
19 cated the case enters an order stating that immediate con-
20
SEC. 5. Section 2 of that Act (15 U.S.C. 29; 49 U.S.C.
20 sideration of the appeal by the Supreme Court is of general
21 45) is amended to read as follows:
21 public importance in the administration of justice. Such
22
" (a) Except as otherwise expressly provided by this
22 order shall be filed within thirty days after the filing of a
23 section, in every civil action brought in any district court
23 notice of appeal. When such an order is filed, the appeal
24 of the United States under the Act entitled 'An Act to pro-
24 and any cross appeal shall be docketed in the time and
25 tect trade and commerce against unlawful restraints and
25 manner prescribed by the rules of the Supreme Court. The
10
11
1 Supreme Court shall thereupon either (1) dispose of the
1 as amended (15 U.S.C. 29; 49 U.S.C. 45) which were in
2 appeal and any cross appeal in the same manner as any
2 effect on the day preceding the date of enactment of this
3 other direct appeal authorized by law, or (2) in its discre-
3 Act.
4 tion, deny the direct appeal and remand the case to the
Passed the Senate July 18, 1973.
5 court of appeals, which shall then have jurisdiction to hear
Attest:
FRANCIS R. VALEO,
6 and determine the same as if the appeal and any cross appeal
Secretary.
7 therein had been docketed in the court of appeals in the
8 first instance pursuant to subsection (a)
9
SEC. 6. (a) Section 401 (d) of the Communications
10 Act of 1934 (47 U.S.C. 401 (d) ) is repealed.
11
(b) The proviso in section 3 of the Act of February
12 19, 1903, as amended (32 Stat. 848, 849; 49 U.S.C. 43),
13 is repealed and the colon preceding it is changed to a
14 period.
15
SEC. 7. The amendment made by section 2 of this Act
16 shall not apply to an action in which a notice of appeal to
17 the Supreme Court has been filed on or before the fifteenth
18 day following the date of enactment of this Act. Appeal in
19 any such action shall be taken pursuant to the provisions
20 of section 2 of the Act of February 11, 1903 (32 Stat. 823) ,
93D CONGRESS
1ST SESSION
S. 782
AN ACT
To reform consent decree procedures, to increase
penalties for violation of the Sherman Act,
and to revise the Expediting Act as it per-
tains to Appellate Review.
JULY 23, 1973
Referred to the Committee on the Judiciary
U.S. HOUSE OF REPRESENTATIVES
COMMITTEE ON THE JUDICIARY
WASHINGTON, D.C.
September 24, 1974
TO:
Hon. Jack Brooks, M.C.
Hon. Walter Flowers, M.C.
Hon. John F. Seiberling, M.C.
Hon. Barbara Jordan, M.C.
Hon. Edward Mezvinsky, M.C.
Hon. Edward Hutchinson, M.C.
Hon. Robert McClory, M.C.
Hon. Charles W. Sandman, Jr., M.C.
gH
Hon. David W. Dennis, M.C.
FROM
James F. Falco, Counsel
Subcommittee on Monopolies and
Commercial Law
In the materials I sent to you yesterday there
was one mistake that had two parts, namely, one
"substantive" amendment was omitted and one
amendment incorrectly combined unrelated matters.
The materials attached hereto should be placed in
the packet and the one you have referring to the
FOIA should be disposed of. My apologies for the
mistake.
One amendment combining all "technical and conform-
ing" amendments is in the process of being prepared
and, so far as I know, this is the only extra
paper work that I shall burden you with.
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Nr. Rodino
Page 2, beginning in line 12, strike out "other than those
which are exempt from disclosure under section 552(b) of title 5,
United States Code,".
Page 2, beginning in line 19, strike out "the proposed consent
judgment, other than those which are exempt from disclosure under
sections 552(b)(4) and (5) of title 5, United States Code," and
insert in lieu thereof "such proposal".
Page 4, line 1, after "considered", add "by the United States
and the anticipated effects on competition of such alternatives".
The Subcommittee's amendment adding the words "including consideration
of the public benefit to be derived from a determination of the issues at
trial," is a restoration of language approved by the Senate Judiciary Com-
mittee but deleted by a Senate floor amendment. Most witnesses in hearings
by the Senate Antitrust Subcommittee as well in House Monopolies Subcommittee
hearings expressed support for the language as legislative solutions to two
problems addressed by the bill: the "backroom" atmosphere of consent decree
negotiations; and judicial rubber stamping of proposals for consent decrees.
Additional reasons for Subcommittee restoration of language are:
(a) Antitrust oversight/review of compliance with Congressional guidelines
enacted will be facilitated; (b) the public widely assumes that such a con-
sideration is an integral part of consent decree formulation procedures and,
in fact, such considerations are publicly acknowledged by Justice Department
officials details of which are not made public; (c) inclusion in the contents
of the impact statement is essential if district courts are meaningfully to
assess proffers of consent decrees; (d) further legislative guidance for
district courts is provided since, "Moreover
...
not only must we consider
the probable effects of the merger upon the economics of the particular
markets affected but also we must consider its probable effects upon the
economic way of life sought to be preserved by the Congress," Brown Shoe Co.
V. United States, 370 U.S. 294 (1962), is a Supreme Court gloss on antitrust
enforcement and judicial responsibilities with respect thereto in which the
Congress has Tong acquiesced and which, in fact, expressed proper interaction
of judicial and legislative functions; (e) effective public comment would be
foreclosed without such language; (f) Issues are refined and possible modifi-
cations that may be necessary since a consent decree, "embodies a compromise;
in exchange for the saving of cost and elimination of risk, the parties each
give up something they might have won had they proceeded to litigation,"
United States V. Armour & Co., 402 U.S. 673, 681 (1971), are facilitated;
(g) Subsequent controversies between the parties over the meaning of consent
decree language or the parties intentions with respect thereto, United States
V. Atlantic Refining Co., 360 U.S. 19 (1959) may be avoided and judicial
resources conserved.
Provisions deleted by the Subcommittee amendment are designed: (a) As a
clarification of intentions not to make changes in the law that has developed
under the Freedom of Information Act (see S. Rept. 93-298 (semble)) and,
(b) to prevent controversies from arising seeking to establish legislative
intentions other than emphasis by incorporation of parts of the FOIA.
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 6, after "plaint" on line 2, add "including consideration
of the public benefit to be derived from a determination of the
issues at trial".
This Subcommittee amendment is also a restoration of a provision
approved by the Senate Judiciary Committee but deleted by a Senate floor
amendment. Section 2(e) sets forth criteria for district courts' dis-
cretion recognized as being necessarily broad because they have a bal-
ancing-of-interests function to perform: information is necessary for
district courts determining that a proposed consent decree is in the
public interest yet preserving consent decrees as "viable settlement
options". S. Rept. 93-298. In this respect, the amendment must be
read in the light of Section 2(h) that prevents the use of impact state-
ments as evidence; and retains present law denying prima facie eviden-
tiary effect of antitrust violations to consent judgments.
In addition, the Subcommittee considered the Senate Judiciary Com-
mittee's further explanation: "Nor is Section 2(e) intended to force
the government to go to trial for the benefit of potential private plain-
tiffs. The primary focus of the Department's enforcement policy should
be to obtain a judgment - either litigated or consensual - which protects
the public by insuring healthy competition in the future." S. Rept. 93-298,
p. 6. Essentially, this recognizes present law: courts cannot compel the
Government to enter into a consent decree; nor can the Government compel
courts to enter proposed decrees that upon acceptance and entry by a court
become judicial action. The proposed legislation does not change present
law. It is expected, moreover, that, as in the past, the greater number
of proposals for consent judgments will not occasion judicial resort to
the calling of witnesses for the purpose of eliciting additional facts.
NINETY-THIRD CONGRESS
PETER W. RODING, JR. (N.J.) CHAIRMAN
HAROLD D. DONOHUE, MASS.
EDWARD HUTCHINSON, MICH.
GENERAL COUNSEL:
JACK BROOKS, TEX.
ROBERT MC CLORY, ILL.
JEROME M. ZEIFMAN
ROBERT W. KASTENMEIER, WIS.
HENRY P. SMITH III, N.Y.
DON EDWARDS, CALIF.
WILLIAM L. HUNGATE, MO.
TOM RAILSBACK, ILL.
Congress of the United States
ASSOCIATE GENERAL COUNSEL:
CHARLES W. SANDMAN, JR., N.J.
GARNER J. CLINE
JCHN CONYERS, JR., MICH.
CHARLES E. WIGGINS, CALIF.
COUNSEL:
COSHUA E.LBERG. PA.
DAVID W. DENNIS, IND.
HERBERT FUCHS
JEROME R. WALDIE. CALIF.
HAMILTON FISH. JR., N.Y.
WALTER FLOWERS, ALA.
WILEY MAYNE, IOWA
Committee on the Judiciary
HERBERT E. HOFFMAN
WILLIAM P. SHATTUCK
JAMES R. MANN, S.C.
LAWRENCE J. HOGAN, MD.
H. CHRISTOPHER NOLDE
PAUL S. SARBANES, MD.
M. CALDWELL BUTLER, VA.
House of Representatives
ALAN A. PARKER
JOHN F. SEIBERLING, OHIO
WILLIAM 5. COHEN, MAINE
JAMES F. FALCO
GEORGE E. DANIELSON, CALIF.
TRENT LOTT. MISS.
MAURICE A. BARBOZA
ROBERT F. DRINAN. MASS.
HAROLD V. FROEHLICH, WIS.
CHARLES B. RANGEL, N.Y.
CARLOS J. MOORHEAD. CALIF.
Mashington, D.C. 20515
FRANKLIN G. POLK
THOMAS E. MOONEY
BARBARA CORDAN, TEX.
JOSEPH J. MARAZITI, N.J.
MICHAEL W. BLOMMER
PAY THORNTON, ARK.
DELBERT L. LATTA, OHIO
ALEXANDER B. COOK
ELIZABETH HOLTZMAN, N.Y.
CONSTANTINE J. GEKAS
WAYNE OWENS, UTAH
EDWARD MEZVINSKY, IOWA
September 24, 1974
MEMORANDUM
TO: Republican Members
FROM: Frank Polk
RE: Antitrust Practices and Procedures Act
5:35
S. 782 was recommended to the full Committee with an amendment in
the nature of a substitute. The bill was introduced by Senator Tunney,
amended by the Senate Judiciary Committee, and further amended on the
floor of the Senate. These latter amendments appear to be the result of
a compromise which, in turn, brought about the unanimous approval (92-0)
of the Senate.
The bill affects three different areas of antitrust law -- consent
decrees, penalties, and appellate procedure. Although no part of the bill
makes any substantive changes in the law, the procedural issues in the
bill are significant.
1. With regard to consent decrees, it should be understood that
nearly 80% of all complaints filed by the Antitrust Division of the Depart-
ment of Justice are settled by the entry of a consent decree. That the
consent decree would become the primary enforcement toolvas probably not
foreseen when Congress wrote the Clayton Act in 1914. However, in retro-
spect, its use is quite logical since there are compelling reasons why both
sides should prefer to settle by entry of a consent decree.
Page 2
Since this actual litigation of an antitrust case consumes an inordinate
amount of time and manpower, the Antitrust Division would be incapable of
reaching that degree of enforcement sufficient to deter violations if every
case went to trial. The use of consent decrees thus allows the Antitrust
Division to allocate limited resources, so that its effectiveness far ex-
ceeds its litigation abilities.
On the other side, defendants enjoy certain advantages in settling
by entry of a consent decree. If the case were to go to trial and if judg-
ment were entered for the government, then by statute aggrieved parties
would be permitted in subsequent lawsuits to plead the judgment as prima
facie evidence of defendant's liability. In effect, such a defendant is
presumed liable and private plaintiffs need only prove their damages and
collect. However, also by statute, the defendant who agrees to a consent
decree, besides possibly deflecting the full force of the government's com-
plaint, is not legally presumed liable in any subsequent lawsuit.
Although the entry of a consent decree is a judicial act, courts have
traditionally not explored the merits of any proposed settlement. It is
said that courts thus serve only as "rubber stamps" and that the public
interest is not secured.
The bill would require that the courts make an independent determina-
tion that the consent decree is in the public interest. To enable the
court to make such a determination, the Justice Department would be required
to submit a competitive impact statement. Moreover, interested parties
would be encouraged to comment on the proposed consent decree and the de-
fendant would be required to disclose all contacts made with any government
employee except those made by its counsel of record acting alone.
Whether the bill improves upon the present practice regarding consent
decrees is debatable. On the one hand, one can point to the consent decree
in the ITT case and argue that safeguards should be established to preclude
settlements allegedly not in the public interest. On the other hand, one
might suggest that since the efficient allocation of resources is necessary
to the Antitrust Division, any proposal which significantly disrupts its
operation is not beneficial. Whether the bill would cause such a disruption
is unknown since the impact of the bill is largely within the discretion
of 93 district courts which may, in determining whether the consent decree
would be in the public interest, require anything from answering a couple
of questions to a so-called mini-trial on the merits. Moreover, since the
bill casts additional burdens on both government and defendant, it may be-
come mutually advantageous to circumvent the bill. This could be achieved
Page 3
if the parties made their settlement before the complaint was filed or if
the Department chose not to convert the settlement into a judicial decree.
The position of the Department of Justice on the bill has been less
than enthusiastic. The Department strongly opposed the version reported by
the Senate Judiciary Committee (identical with H.R. 9203). After certain
amendments were adopted on the Senate floor which alleviated some of the
bill's problems, the Department changed its position to "no opposition."
Since most of these amendments were eliminated in subcommittee, the Depart-
ment opposes approval of the bill.
One might reasonably suspect that the Department's "no opposition"
position with regard to the Senate-passed version is something other than
a firm belief on its part. Rather, the Department may have made the best
of a bad situation by bargaining for amendments that mitigate the bill's
impact.
Whether consent-decree reform as prescribed in S.782 is wise is a
question that must be viewed in a context broader than that set out in
discussions of various amendments. Generally, the reform is founded on
a need to "second guess" the Antitrust Division's prosecutorial activity.
Thus the bill would require the Antitrust Division to publicize its
activity (why it brought the suit, what remedies it considered, which one
it decided on, the effect of the proposed remedy on competition, etc.)
and defendants to publicize their so-called lobbying contacts with the
government. But more than that, the bill would require that the court
evaluate the record to determine whether the Antitrust Division had acted
in the "public interest" in proposing a particular consent decree.
Central to any such evaluation will be how the Division is utilizing its
administrative resources to enforce the policy of the antitrust laws, how
strong or weak its case is against the defendant, how long it would take
to try the case to conclusion, and how relevant the legal issues of the
particular case are to future cases. In other words, the court will be
required to evaluate an exercise of prosecutorial discretion in its
purest form. Although in other contexts courts are called upon to decide
what is in the "public interest", it does not follow that every question
of what is in the "public interest" is judicially cognizable. Here,
the question is not whether prosecutorial discretion has been exercised.
according to a fixed standard but whether it has been exercised well or,
more precisely, as well as possible. Are such questions appropriate
for courts?
The next question is whether a judge's order granting or rejecting
the proposed consent decree is appealable. This as a practical matter is
not important unless the right of third parties to intervene is enlarged
by the bill. During the subcommittee hearings, proponents of the
Page 4
bill argued that it was not while opponents feared that that was exactly
what the bill might authorize. The Senate version sought to preclude any
expansive interpretation by tying intervention rights to those accorded
under the Federal Rules of Civil Procedure. However, the subcommittee
adopted a "technical" amendment deleting reference to the Federal Rules
as unnecessary. In view of the controversy regarding this question,
every precaution should be taken lest the consent-decree procedure be
construed as some liberalizing exception to regular procedure.
In determining whether a proposed consent decree is in the public
interest, a judge is authorized by the bill, as amended in subcommittee,
to consider "the public benefit to be derived from a determination of
the issues at trial, Section 2(e)2. What could those words mean? No
proponent of the bill has sought to give those words a salutary meaning.
Others both for and against the bill have criticized the language as
inviting judicial suspension in particular cases of the Congressional
policy enunciated in section 5 of the Clayton Act that consent decrees
are not to be considered as prima facie evidence of defendant's liability
in subsequent cases brought by aggrieved parties. It will generally
be true from the standpoint of the antitrust laws that a consent decree
will be less in the public interest than a litigated judgment by the
simple fact that the latter is a benefit to private plaintiffs and the
former is not. Should this Congressionally mandated difference be a
factor in rejecting a proposed consent decree? The answer would clearly
be negative were it not for the fact that Congress is deciding the
question, and Congress may, of course, repeal in whole or in part its
prior policy. However, if Congress is to undercut its prior policy on
consent decrees, it should do so knowingly. If Congress wishes to
preserve its prior policy, Section 2(e)2 should be rewritten to make
clear that a judge may examine the proposed decree to see how by its
terms it provides general and specific relief from the alleged antitrust
violation without regard to the legislatively mandated legal effect
of a consent decree in subsequent litigation.
The Antitrust Division for administrative reasons opposes a sub-
committee amendment to Section 2(b)6 that would require that the
competitive impact statement, in addition to stating what alternative
remedies the Division considered, also state what effect on competition
each such alternative would have if adopted. The Department suggests
that the requirement would have a chilling effect on the free exchange of
ideas within the Antitrust Division. And if the proposed consent decree
were rejected by the court, the defendant would be well-armed with in-
side information if the Department decided to go to trial. Such explor-
ation of alternatives, it is argued, would be time-consuming and
speculative.
Page 5
Another problem is found in Section 2(g), the lobbying-contacts
provision. The Senate-passed version says that all contacts by the
defendant with the U.S. government relevant to the proposed consent
decree must be reported except those between defendant's counsel
of record and the Department. The House subcommittee version both
narrows and broadens the exception. It is narrower in that counsel
of record must be "alone," that is, without any corporate officers.
It is broader in that such counsel acting alone may contact anyone in
government and still come within the exception to the reporting require-
ment. The subcommittee rationale is that when counsel is accompanied
by a corporate representative, it is in fact a lobbying contact and
should be reported. What is not addressed, however, is why contacts
by counsel with government employees not with the Justice Department
should not be reported if they relate to the particular case.
2. The second part of the bill increases penalties for Sherman
Act violations. It is not controversial.
3. As originally enacted in 1903, the Expediting Act had two main
purposes: (1) ensuring an effective trial court for antitrust cases
instituted by the Government under the then new and untested Sherman
Act; and (2) providing an expedited direct appeal to the Supreme Court
in cases involving novel issues which demanded clear, concise answers
from the Supreme Court.
The Expediting Act in Section 1 presently provides for a three
judge federal court in cases where the United States brings an action
under the Sherman Act, the Clayton Act, and certain sections of the
Interstate Commerce Act and where the Attorney General files with
the trial court a certificate that the action is of general public
importance. This provision, while having validity when the antitrust
laws were first enacted to insure a complete and effective trial of
the novel and complex issues presented by these Act, has outlived its
usefulness and is now rarely if ever invoked.
Thus, the bill amends Section 1 of the Expediting Act to eliminate
the provision for three-judge courts and to require that, as in other
government litigation, the cause be tried to a single federal district
court. However, the bill does retain the provision for expeditious
consideration, should the public importance of the issue require it;
but, trial is before a single federal district judge.
Today the major controversy about the Expediting Act concerns
its provisions for appellate review. Section 2 of the Expediting
Act provides for direct review of final district court judgments by the
Supreme Court. This "expediting" of the appellate process was more
justified when antitrust issues were generally issues of first impression
Page 6
than it is today when appeals as of right to the Supreme Court are less
necessary to antitrust and more burdensome on an ever-growing Supreme
Court docket, as some Justices have commented in their written opinions.
Thus both the Johnson and Nixon Administrations proposed modern
compromises somewhere between the Expediting Act provisions and the
general provisions for the appeal of other cases. Such proposals have
sought to preserve the opportunity for direct review for certain special
cases while channeling other antitrust cases through regular procedures.
The difficulty with such compromises has been in finding the appropriate
mechanism for determining which are the special cases.
The Senate version would permit the trial judge, on application of
either party, to certify that direct review is of general public importance
in the administration of justice. The problem with that mechanism is
that the trial judge is not in the best position to determine how important
the case at bar is to the enforcement of the antitrust laws, i.e. other
cases pending in other courts in other districts or yet to be filed.
The only one who can make that judgment is the Attorney General, the
same party that determines that a given trial should be expedited both
under current law and S. 782 (Senate and subcommittee versions).
But the subcommittee did not adopt that suggestion, which was
offered by Mr. Hutchinson. Rather on a party line vote, the subcommittee
decided to retain present law on the point. It chose to ensure direct
review of every case so that important cases would be heard directly
by the Supreme Court. But as a practical matter, the Supreme Court does
not allow itself to be forced to hear non-important antitrust cases on
appeal. It summarily affirms them, thereby denying any appellate review
in those cases. Thus present law favors the important antitrust case but
discriminates against other antitrust cases by treating them as less
than any routine case. Mr. Hutchinson's amendment would have treated
routine antitrust cases as routine and special cases as special.
Finally, both the Senate version and the subcommittee version
agree that interlocutory appeals should be permitted to the court of
appeals. This is not a matter of controversy. However, its presence
in the subcommittee version points up an incongruity, that all inter-
locutory appeals go to the courts of appeals and all final appeals go
to the Supreme Court.
FGP:slh
Amendment No. 1
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 2, beginning in line 9, strike out "other than
those which are exempt from disclosure under section 552(b)
of title 5, United States Code,
Page 2, beginning line 15, strike out "other than
those which are exempt from disclosure under sections
552 (b) (4) and (5) of title 5, United States Code,".
Page 3, line 16, after "States", add "and the
anticipated effects on competition of such alternatives".
Amendment No. 2
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 2, line 24, strike out "public" and insert in lieu
thereof "competitive".
Page 4, line 3, strike out "public" and insert in lieu
thereof "competitive".
Page 7, beginning in line 15, strike out "public impact
statements" and insert in lieu thereof "the competitive impact
statement".
Amendment No. 3
Amendment to S. 782
(Committee Print 9/25/74)
Offered by Mr. Rodino
Page 5, lines 2 and 3, strike out "as defined by law".
Amendment No. 4
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 5, after line 13, add ", including consideration of
the public benefit to be derived from a determination of the
issues at trial".
Amendment No. 5
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 6, line 25, immediately after "person" insert
", except with respect to any and all written or oral
communications on behalf of such defendant by counsel of
record alone,".
Page 7, beginning in line 3, strike out "the proposed
consent judgment: Provided, That communications made by or
in the presence of counsel of record with the Attorney General
or the employees of the Department of Justice shall be ex-
cluded from the requirements of this subsection" and insert
in lieu thereof "such proposal".
Amendment No. 6
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 8, strike out line 25 and all that follows down
through line 11 on page 9.
Page 9, line 12, insert the following:
(b) Section 2 of the Act of February 11, 1903 (15
U.S.C. 29; 49 U.S.C. 45), commonly known as the Expediting
Act, is amended by adding at the end of such section the
following:
Page 9, strike out line 23 and all that follows down
through line 16 on page 10.
Page 11, strike out lines 12 through 20.
Amendment No. 1
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 2, beginning in line 9, strike out "other than
those which are exempt from disclosure under section 552(b)
of title 5, United States Code,".
Page 2, beginning line 15, strike out "other than
those which are exempt from disclosure under sections
552(b) (4) and (5) of title 5, United States Code,".
Page 3, line 16, after "States", add "and the
anticipated effects on competition of such alternatives".
Amendment No. 2
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 2, line 24, strike out "public" and insert in lieu
thereof "competitive".
Page 4, line 3, strike out "public" and insert in lieu
thereof "competitive".
Page 7, beginning in line 15, strike out "public impact
statements" and insert in lieu thereof "the competitive impact
statement".
Amendment No. 3
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 5, lines 2 and 3, strike out "as defined by law".
Amendment No. 4
Amendment to S. 782
(Committee Print- - 9/25/74)
Offered by Mr. Rodino
Page 5, after line 13, add ", including consideration of
the public benefit to be derived from a determination of the
issues at trial".
Amendment No. 5
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 6, line 25, immediately after "person" insert
", except with respect to any and all written or oral
communications on behalf of such defendant by counsel of
record alone,".
Page 7, beginning in line 3, strike out "the proposed
consent judgment: Provided, That communications made by or
in the presence of counsel of record with the Attorney General
or the employees of the Department of Justice shall be ex-
cluded from the requirements of this subsection" and insert
in lieu thereof "such proposal".
Amendment No. 6
Amendment to S. 782
(Committee Print--9/25/74)
Offered by Mr. Rodino
Page 8, strike out line 25 and all that follows down
through line 11 on page 9.
Page 9, line 12, insert the following:
(b) Section 2 of the Act of February 11, 1903 (15
U.S.C. 29; 49 U.S.C. 45), commonly known as the Expediting
Act, is amended by adding at the end of such section the
following:
Page 9, strike out line 23 and all that follows down
through line 16 on page 10.
Page 11, strike out lines 12 through 20.
Amendments to S. 782
(Committee Print--9/25/74)
Offered by Mr. Owens
Page 6, line 25, after "or other person" insert "with any officer
or employee of the United States concerning or relevant to such proposal,
except with respect to any and all written or oral communication on behalf
of such defendant by counsel of record alone with the Attorney General
or the employees of the Antitrust Division of the Department of Justice."
Page 6, line 25, strike out ,except" and all that follows down
through "such proposal. 11 on line 7, page 7.
Committee Statement
This amendment is a substitute for the Subcommittee's amendment
No. 5. It merely adds another phrase to the lobbying disclosure provision
clarifythe
of the bill. It is intended to insure the disclosure of lobbying contacts that
may influence the settlement of antitrust cases. It requires the public dis-
closure of lobbying contacts by members of the federal government who are
not members of the Antitrust Division of the Justice Department.
This amendment will thus close two significant loopholes. It will
now require the disclosure of lobbying contacts made by defendants with
influential individuals outside the Department of Justice. For example, it
will compel the disclosure of lobbying contacts by antitrust defendants
with people like the Secretary of the Treasury. Secondly, it will require the
disclosure of lobbying efforts directed at individuals who may be a part of
the Justice Department outside the Antitrust Division of the Department.
That would include efforts to lobby, for example, the Chief of the Criminal
Justice Department
Division 7 in connection with antitrust cases subsequently settled by a
consent decree.
This amendment will make lobbying disclosure provisions of this
important bill more realistic, more comprehensive and more effective. I
urge your support for this amendment.
Wells Fargo Bank Building, Suite 440
LOGICON
21535 Hawthorne Boulevard, Torrance, California 90503
(213) 542-7313
September 30, 1974
The Honorable Peter W. Rodino, Jr.
Chairman, Judiciary Committee
United States House of Representatives
Washington, D. C. 20515
Dear Mr. Rodino:
We have been informed that the proposed "Antitrust Procedures and
Penalties Act" (the Tunney Bill - H. R. 9203) has not yet been reported
out of the Judiciary Committee even though the Monopolies Subcommittee
completed hearings on the bill in October of 1973. As you are probably
aware, a substantially identical version of this bill has already passed the
Senate unanimously. While robust debate and careful evaluation of every
bill pending in Congress are essential, we deplore a delay of this magni-
tude. We respectfully request that the bill be referred back to the full
House with a favorable recommendation forthwith.
We feel that the effect this bill would have on the consent decree procedures
of antitrust litigation are obviously and amply advantageous. Since the
principles behind the antitrust laws are the protection of the weaker
segments of industry as well as the public in general from the anti-
competitive efforts of industrial giants, it seems only logical that the
smaller companies who are likely to be affected by the antitrust action
brought in their behalf should have a voice in its outcome. While we are
specifically interested in seeing that the bill's mandate becomes effective
before settlement of the present litigation by the United States against
International Business Machines Corporation, it seems clear that opening
the negotiations between a defendant and the Justice Department to public
scrutiny and response is advisable as a matter of general application to
antitrust litigation involving any industry.
Additionally, we feel that judicial evaluation of a proposed decree, and
public opinion operating to review both court and plaintiff, increase the
probable effectiveness of the ultimate decree. Too frequently has recent
history seen a consent decree fail of purpose, whether by Justice Department's
LOGICON
The Honorable Peter W. Rodino, Jr.
September 30, 1974
Chairman, Judiciary Committee
Page 2
lack of foresight or otherwise. A new scheme of checks and balances
can only serve to tighten up the consent procedure, tend to restore public
faith in the Executive Branch, and increase participation of non-parties in
decisions which affect their industrial livelihood.
We urge a prompt, favorable Committee vote as soon as possible.
Sincerely yours,
LOGICON, INC.
JRW:mm
CC: Judiciary Committee Members
STATEMENT CONCERNING S. 782 FOR FULL COMMITTEE MEETING - OCTOBER 2, 1974
The Subcommittee on Monopolies and Commercial Law this morning reports
favorably on important new antitrust legislation, the Antitrust Procedures
and Penalties Act, S. 782, that passed the Senate unanimously by a 92-0 vote.
The Act was the subject of intense legislative and oversight study by
the Monopolies Subcommittee since not only is new legislation presented but
also remedies for abuses in consent decree procedures that have been criticized
for a long time and which began in a 1959 Monopolies Subcommittee Report. The
Subcommittee held 4 days of hearings during which more than 200 pages of
testimony were received from distinguished representatives from the public
and private antitrust bars. The Subcommittee also believes that enactment
of the proposed measure would be a giant step forward in restoring public
confidence in the impartial execution of the antitrust laws.
As the Subcommittee observed in 1959, "The consent decree practice has
established an orbit in the twilight zone between established rules of
administrative law and judicial procedures." The first part of the bill,
therefore, requires the filing of an impact statement explaining proposed
consent decrees along with requirements for public notice; requires district
courts to determine that proposals are in the public interest and provides
legislative guidelines for the exercise of judicial discretion; and, requires
the publication of lobbying contacts made with the Justice Department in the
course of the formulation of consent decrees.
The second part of the bill would increase fines for Sherman Act offenses
from $50,000 to $500,000 for corporations and $100,000 for individuals and
- 2 -
non-corporate business enterprises. It was in 1955, that these fines were
raised from $5,000 to $50,000 and revisions upward on fine ceilings are
long overdue. The need for effective deterrents to antitrust violations
has not been disputed before the Subcommittee or, for that matter, in the
Senate. Current events increase this need for effective deterrents since
one FTC Commissioner recently estimated that unlawful price-fixing currently
adds $10 billion annually to prices paid by consumers; and, the Assistant
Attorney General for Antitrust observed that "vigorous enforcement" of the
antitrust laws is the "true anti-inflationary road" to follow.
The third part of the bill is innovative providing measures to reduce
time from filing to trial in civil cases; and, providing appellate review
of district court pre-trial orders relating to preliminary injuctions in
merger cases. This latter provision is expected to have the added benefit
of reducing appeals to the Supreme Court following litigation.
93D CONGRESS
2D SESSION
H.R. 17063
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 3, 1974
Mr. RODINO introduced the following bill; which was referred to the Com-
mittee on the Judiciary
A
BILL
To reform consent decree procedures, to increase penalties for
violation of the Sherman Act, and to revise the Expediting
Act as it pertains to appellate review.
1
Be it enacted by the Senate and House of Representa-
2
tives of the United States of America in Congress assembled,
3
That this Act may be cited as the "Antitrust Procedures and
4
Penalties Act".
5
CONSENT DECREE PROCEDURES
6
SEC. 2. Section 5 of the Act entitled "An Act to sup-
7 plement existing laws against unlawful restraints and monop-
8 olies, and for other purposes", approved October 15, 1914
9 (15 U.S.C. 16), is amended by redesignating subsection (b)
10 as (i) and by inserting immediately after subsection (a) the
11 following:
12
(b) Any proposal for a consent judgment submitted
I
2
3
1 by the United States for entry in any civil proceeding
1
contained therein, relief to be obtained thereby, and the
2 brought by or on behalf of the United States under the anti-
2
anticipated effects on competition of such relief;
3 trust laws shall be filed with the district court before which
3
" (4) the remedies available to potential private
4 such proceeding is pending and published by the United
4
plaintiffs damaged by the alleged violation in the event
5 States in the Federal Register at least 60 days prior to
5
that such proposal for the consent judgment is entered
6 the effective date of such judgment. Any written comments
6
in such proceeding;
7 relating to such proposal and any responses by the United
7
" (5) a description of the procedures available for
8 States thereto, shall also be filed with such district court and
8
modification of such proposal; and
9 published by the United States in the Federal Register
9
" (6) a description and evaluation of alternatives
10 within such sixty-day period. Copies of such proposal and
10
to such proposal actually considered by the United
11 any other materials and documents which the United States
11
States.
12 considered determinative in formulating such proposal, shall
12
" (c) The United States shall also cause to be published,
13 also be made available to the public at the district court and
13 commencing at least 60 days prior to the effective date of
14 in such other districts as the court may subsequently direct.
14 the judgment described in subsection (b) of this section,
15 Simultaneously with the filing of such proposal, unless
15 for 7 days over a period of 2 weeks in newspapers of general
16 otherwise instructed by the court, the United States shall
16 circulation of the district in which the case has been filed,
17 file with the district court, publish in the Federal Register,
17 in the District of Columbia, and in such other districts as the
18 and thereafter furnish to any person upon request, a com-
18 court may direct-
19 petitive impact statement which shall recite-
19
" (i) a summary of the terms of the proposal for
20
" (1) the nature and purpose of the proceeding;
20
the consent judgment,
21
" (2) a description of the practices or events giving
21
" (ii) a summary of the competitive impact state-
22
rise to the alleged violation of the antitrust laws;
22
ment filed under subsection (b)
23
" (3) an explanation of the proposal for a consent
23
" (iii) and a list of the materials and documents
24
judgment, including an explanation of any unusual cir-
24
under subsection (b) which the United States shall
25
cumstances giving rise to such proposal or any provision
25
make available for purposes of meaningful public com-
4
5
1
ment, and the place where such materials and documents
1
anticipated effects of alternative remedies actually con-
2
are available for public inspection.
2
sidered, and any other considerations bearing upon the
3
" (d) During the 60-day period as specified in subsection
3
adequacy of such judgment;
4 (b) of this section, and such additional time as the United
4
" (2) the impact of entry of such judgment upon
5 States may request and the court may grant, the United
5
the public generally and individuals alleging specific
6 States shall receive and consider any written comments re-
6
injury from the violations set forth in the complaint
7 lating to the proposal for the consent judgment submitted
7
including consideration of the public benefit, if any, to
S under subsection (b) The Attorney General or his designee
8
be derived from a determination of the issues at trial.
9 shall establish procedures to carry out the provisions of this
9
" (f) In making its determination under subsection (e)
10 subsection, but such 60-day time period shall not be short-
10
the court may-
11 ened except by order of the district court upon a showing
11
" (1) take testimony of Government officials or ex-
12 that (1) extraordinary circumstances require such shorten-
12
perts or such other expert witnesses, upon motion of any
13 ing and (2) such shortening is not adverse to the public
13
party or participant or upon its own motion, as the court
14 interest. At the close of the period during which such com-
14
may deem appropriate;
15 ments may be received, the United States shall file with the
15
" (2) appoint a special master and such outside con-
16 district court and cause to be published in the Federal
16
sultants or expert witnesses as the court may deem ap-
17 Register a response to such comments.
17
propriate; and request and obtain the views, evaluations,
18
" (e) Before entering any consent judgment proposed by
18
or advice of any individual, group or agency of govern-
19 the United States under this section, the court shall determine
19
ment with respect to any aspect of the proposed judg-
20 that the entry of such judgment is in the public interest.
20
ment or the effect of such judgment, in such manner as
21 For the purpose of such determination, the court may con-
21
the court deems appropriate;
22 sider-
22
" (3) authorize full or limited participation in pro-
23
" (1), the competitive impact of such judgment, in-
23
ceedings before the court by interested persons or agen-
24
cluding termination of alleged violations, provisions for
24
cies, including appearance amicus curiae, intervention as
25
enforcement and modification, duration of relief sought,
H.R. 17063-2
6
7
1
a party pursuant to the Federal Rules of Civil Proce-
1 consent judgment pursuant to the antitrust laws, each de-
2
dure, examination of witnesses or documentary mate-
2 fendant shall certify to the district court that the requirements
3
rials, or participation in any other manner and extent
3 of this subsection have been complied with and that such
4
which serves the public interest as the court may deem
4 filing is a true and complete description of such communi-
5
appropriate;
5 cations known to the defendant or which the defendant
6
(4) review any comments including any objec-
6 reasonably should have known.
7
tions filed with the United States under subsection (d)
7
(h) Proceedings before the district court under sub-
8
concerning the proposed judgment and the responses of
8 sections (e) and (f) of this section, and the competitive
9
the United States to such comments and objections; and
9 impact statement filed under subsection (b) of this section,
10
(5) take such other action in the public interest
10 shall not be admissible against any defendant in any action or
11
as the court may deem appropriate.
11 proceeding brought by any other party against such defend-
12
" (g) Not later than 10 days following the date of
12 ant under the antitrust laws or by the United States under
13 the filing of any proposal for a consent judgment under
13 section 4A of this Act nor constitute a basis for the introduc-
14 subsection (b), each defendant shall file with the district
14 tion of the consent judgment as prima facie evidence against
15 court a description of any and all written or oral communi-
15 such defendant in any such action or proceeding."
16 cations by or on behalf of such defendant, including any
16
PENALTIES
17 and all written or oral communications on behalf of such
17
SEC. 3. Sections 1, 2, and 3 of the Act entitled "An
18 defendant by any officer, director, employee, or agent of
18 Act to protect trade and commerce against unlawful re-
19 such defendant, or other person, with any officer or employee
19 straints and monopolies", approved July 2, 1890 (15 U.S.C.
20 of the United States concerning or relevant to such proposal,
20 1, 2, and 3), are each amended by striking out "fifty thou-
21 except that any such communications made by counsel of
21 sand dollars" whenever such phrase appears and inserting
22 record alone with the Attorney General or the employees of
22 in each case the following: "five hundred thousand dollars
23 the Department of Justice alone shall be excluded from
23 if a corporation, or, if any other person, one hundred thou-
24 the requirements of this subsection. Prior to the entry of any
24 sand dollars".
8
9
1
EXPEDITING ACT REVISIONS
1 to protect trade and commerce against unlawful restraints
2
SEC. 4. (a) Section 1 of the Act of February 11, 1903
2 and monopolies', approved July 2, 1890, or any other Acts
3 (15 U.S.C. 28; 49 U.S.C. 44), commonly known as the
3 having like purpose that have been or hereafter may be
4 "Expediting Act", is amended to read as follows:
4 enacted, in which the United States is the complainant and
5
"SECTION 1. In any civil action brought in any district
5 equitable relief is sought, any appeal from a final judgment
6 court of the United States under the Act entitled 'An Act
6 entered in any such action shall be taken to the court of
7 to protect trade and commerce against unlawful restraints
7 appeals pursuant to sections 1291 and 2107 of title 28 of
8 and monopolies', approved July 2, 1890, or any other Acts
8 the United States Code. An appeal from an interlocutory
9 having like purpose that have been or hereafter may be
9 order entered in any such action shall be taken to the court
10 enacted, wherein the United States is plaintiff and equitable
10 of appeals pursuant to sections 1292 (a) (1) and 2107 of
11 relief is sought, the Attorney General may file with such
11 title 28, United States Code, but not otherwise. Any judg-
12 court, prior to the entry of final judgment, a certificate that,
12 ment entered by the court of appeals in any such action
13 in his opinion, the case is of general public importance.
13 shall be subject to review by the Supreme Court upon a writ
14 Upon filing of such certificate, it shall be the duty of the
14 of certiorari as provided in section 1254 (1) of title 28,
15 judge designated to hear and determine the case, or the chief
15 United States Code.
16 judge of the district court if no judge has as yet been desig-
16
" (b) An appeal from a final judgment entered in any
17 nated, to assign the case for hearing at the earliest practi-
17 action specified in subsection (a) shall lie directly to the
18 cable date and to cause the case to be in every way ex-
18 Supreme Court if the Attorney General files in the district
19 pedited.".
19 court a certificate stating that immediate consideration of
20
(b) Section 2 of the Act of February 11, 1903 (15
20 the appeal by the Supreme Court is of general public im-
21 U.S.C. 29; 49 U.S.C. 45), commonly known as the Ex-
21 portance in the administration of justice. Such certificate
22 pediting Act, is amended to read as follows:
22 shall be filed within 10 days after the filing of a notice of
23
"SEC. 2. (a) Except as otherwise expressly provided
23 appeal. When such a certificate is filed, the appeal and any
24 by this section, in every civil action brought in any district
24 cross appeal shall be docketed in the time and manner pre-
25 court of the United States under the Act entitled 'An Act
25 scribed by the rules of the Supreme Court. The Supreme
10
11
1 Court shall thereupon either (1) dispose of the appeal and
1 shall apply to any case prosecuted under the direction of the
2 any cross appeal in the same manner as any other direct ap-
2 Attorney-General in the name of the Interstate Commerce
3 peal authorized by law, or (2) deny the direct appeal and
3 Commission".
4 remit the case to the appropriate court of appeals, which
4
EFFECTIVE DATE OF EXPEDITING ACT REVISIONS
5 shall then have jurisdiction to hear and determine such case
5
SEC. 6. The amendment made by section 4 of this Act
6 as if the appeal and any cross appeal in such case had been
6 shall not apply to an action in which a notice of appeal to
7 docketed in the court of appeals in the first instance pursuant
7 the Supreme Court has been filed on or before the fifteenth
8 to subsection (a) .".
8 day following the date of enactment of this Act. Appeal in
9 APPLICATION OF EXTENDING ACT TO COMMUNICATIONS
9 any such action shall be taken pursuant to the provisions
10
ACT OF 1934
10 of section 2 of the Act of February 11, 1903 (32 Stat. 823),
11
SEC. 5. (a) Section 401 (d) of the Communications
11 as amended (15 U.S.C. 29; 49 U.S.C. 45) which were in
12 Act of 1934 (47 U.S.C. 401 (d) ) is repealed.
12 effect on the day preceding the date of enactment of this
13
(b) Section 3 of the Act entitled "An Act to further
13 Act.
14 regulate commerce with foreign nations and among the
15 States", approved February 19, 1903 (32 Stat. 849; 49
16 U.S.C. 43), is amended by striking out the following:
17 ": Provided, That the provisions of an Act entitled 'An Act
18 to expedite the hearing and determination of suits in equity
19 pending or hereafter brought under the Act of July second,
20 eighteen hundred and ninety, entitled "An Act to protect
21 trade and commerce against unlawful restraints and monop-
22 olies," "An Act to regulate commerce," approved Febru-
23 ary fourth, eighteen hundred and eighty-seven, or any other
24 Acts having a like purpose that may be hereafter enacted,
25 approved February eleventh, nineteen hundred and three,
93D CONGRESS
2D SESSION
H. R. 17063
A
BILL
To reform consent decree procedures, to increase
penalties for violation of the Sherman Act,
and to revise the Expediting Act as it per-
tains to appellate review.
By Mr. RODINO
OCTOBER 3, 1974
Referred to the Committee on the Judiciary
NINETY-THIRD CONGRESS
PETER W. RODINO, JR. (N.J.) CHAIRMAN
HAROLD D. DONOHUE, MASS.
EDWARD HUTCHINSON, MICH.
GENERAL COUNSEL:
JACK BROOKS, TEX.
ROBERT MCCLORY, ILL.
JEROME M. ZEIFMAN
ROBERT W. KASTENMEIER, WIS.
HENRY P. SMITH III, N.Y.
DON EDWARDS, CALIF.
WILLIAM L. HUNGATE, MO,
TOM RAILSBACK, ILL.
Congress of the United States
ASSOCIATE GENERAL COUNSEL:
CHARLES W. SANDMAN, JR., N.J.
GARNER J. CLINE
JOHN CONYERS, JR., MICH.
CHARLES E. WIGGINS, CALIF.
COUNSEL:
JOSHUA EILBERG, PA.
DAVID W. DENNIS, IND.
HERBERT FUCHS
JEROME R. WALDIE, CALIF.
HAMILTON FISH, JR., N.Y.
Committee mt the Judiciary
HERBERT E. HOFFMAN
WALTER FLOWERS, ALA.
WILEY MAYNE, IOWA
WILLIAM P. SHATTUCK
JAMES R. MANN, S.C.
LAWRENCE J. HOGAN, MD.
H. CHRISTOPHER NOLDE
PAUL S. SARBANES, MD.
M. CALDWELL BUTLER, VA.
House of Representatives
ALAN A. PARKER
JOHN F. SEIBERLING, OHIO
WILLIAM S. COHEN, MAINE
JAMES F. FALCO
GEORGE E. DANIELSON, CALIF.
TRENT LOTT, MISS.
MAURICE A. BARBOZA
ROBERT F. DRINAN, MASS.
HAROLD V. FROEHLICH, WIS.
CARLOS J. MOORHEAD, CALIF.
Mashington, D.C. 20515
FRANKLIN G. POLK
CHARLES S. RANGEL, N.Y.
THOMAS E. MOONEY
BARBARA JORDAN, TEX.
JOSEPH J. MARAZITI, N.J.
MICHAEL W. BLOMMER
RAY THORNTON, ARK.
DELBERT L. LATTA, OHIO
ALEXANDER B. COOK
ELIZABETH HOLTZMAN, N.Y.
CONSTANTINE J. GEKAS
WAYNE OWENS, UTAH
October 7, 1974
EDWARD MEZVINSKY, IOWA
MEMORANDUM
OCT -7 1974
4 pm
TO: Republican Members
FROM: Frank Polk
RE: Antitrust Practices and Procedures Act
On September 24, 1974, a memorandum was circulated analyzing
S. 782, the Senate passed version of the Antitrust Practices and
Procedures Act. This memo is a supplement to that analysis. In
the memo of September 24, several areas of concern were outlined.
To recapitulate, they are as follows:
(1) whether the consent decree provisions of the bill expand
Same
right
the right of any person to intervene as a party in a
as under
proceeding before a court to determine whether the pro-
Present
posed consent decree is in the public interest;
(2) whether in making a determination that the proposed consent
decree is in the public interest, a court may consider the
public benefit of a determination of the issues at a trial;
(3) whether the Department of Justice must include in its
competitive impact statement a description and evaluation
NO
of the effect on competition of alternatives to the pro-
posed consent decree that were not adopted;
(4) whether an exception to the general rule that the defendant
must report all contacts made with government employees
concerning the proposed consent decree should be made for
contacts made by or in the presence of counsel of record
with the Attorney General or employees of the Department; and
(5) whether antitrust cases should be appealed under the ordinary
rules of appellate procedure but with the exception that the
soprovides
Attorney General may certify that a case is of general public
importance, SO as to permit a direct appeal to the Supreme
Court.
- 2 -
On October 3, 1974, there was an informal meeting of the
Antitrust Subcommittee. At that meeting the above questions were
discussed. As a result of the informal discussion, the Chairman
introduced a clean bill -- H.R. 17063 -- which includes some but
not all of the changes thought desirable in the memorandum of
September 24, 1974.
With regard to the first question, H.R. 17063 makes clear that
the right of a party to intervene is no more and no less than that
accorded under current law. With regard to the third question,
H.R. 17063 deletes the requirement that the Department of Justice
include in a competitive impact statement the effect on competition
of alternatives to the consent decree that were not adopted. With
regard to the fifth question, H.R. 17063 adopts the so-called Hutchinson
amendment which provides for Attorney General certification of anti-
trust cases so that they may be directly appealed to the Supreme
Court.
However, the resolution with regard to questions 2 and 4 may
be considered less than satisfactory. With regard to question 4,
it is generally assumed that contacts by the defendant with government
employees relevant to the consent decree should be reported to the
court which is determining whether the consent decree is in the public
interest. Controversy has generally focused on which contacts, if
any, should be exempted from the reporting requirement. The Senate
bill would exempt contacts made by or in the presence of counsel with
the Attorney General or employees of the Department of Justice. The
Department of Justice, itself, favors this Senate provision. On the
House side, the Subcommittee concluded that any contact made by a
corporate officer and the counsel of record with the Department of
Justice was more a "lobbying" contact than it was a "lawyering" con-
tact and thus should be reported. The original Subcommittee version
then created an exemption for any and all contacts made by counsel
of record alone with any government employee within or without the
Department of Justice. At the informal meeting there was a discussion
of whether the Senate version or the Subcommittee version should be
preferred. Although there was not unanimous agreement, a majority
chose to adopt the following compromise: that the Subcommittee version
would be retained with regard to meetings with counsel of record alone
and the Department of Justice but that the Senate version would be
preferred with regard to meetings by counsel of record and government
employees outside the Department of Justice. What this means is
that contacts made by the defendant with the plaintiff must be
reported. The Department of Justice reasons that the reporting re-
quirement will have a chilling effect on such contacts and that such
chilling effect is undesirable because it very frequently occurs that
officers of the defendant corporation are rather direct in indicating
to the Department the exact nature of their questioned activity. The
Department foresees under the compromise embraced by H.R. 17063 that
it will become the general practice for defendant's counsel to appear
- 3 -
at the Department alone so that the contact will not have to be
reported and that the Department will thereby by deprived of this
occasional source of information.
With regard to the second question, H.R. 17063 includes language -
approved earlier by the House Subcommittee but rejected by the Senate
in approving S. 782 - that would authorize a court to consider "the
public benefit, if any, to be derived from a determination of the
issues at trial" as a factor to be weighed in determining whether the
proposed consent decree is in the public interest. The problem
is that this language appears to be a direct invitation to the courts
to suspend the Congressional policy with regard to consent decrees
that was incorporated in the Clayton Act of 1914. That Congressional
policy is to make consent decrees easier to obtain by making them more
attractive to defendants. Section 5 of the Clayton Act did this by
providing that a litigated judgment would be prima facie evidence of
liability in a subsequent case brought by a treble damage plaintiff
but that a consent decree would not be. The real purpose of the
Congressional policy is not to make antitrust enforcement easier on
defendants but to facilitate the enforcement of the antitrust laws
for the government. If the government had to actually litigate every
antitrust issue, this would consume such time and manpower that violators
of the antitrust laws would feel quite optimistic about escaping the
sanctions of the antitrust laws. Today, 80 percent of the judgments
in government cases are consent decrees. Without the useful tool of
the consent decree, the government could not exert the leverage that
it does in enforcing the antitrust laws unless the size of the Anti-
trust Division was greatly expanded. The problem with the language
in H.R. 17063 is that it invites the judge to determine whether a
litigated judgment will be better for individuals who are alleging
specific injury from the violations set forth in the complaint. Under
Section 5 of the Clayton Act a litigated judgment will always be
better for such individuals. Therefore, the language seems to
suggest that a court should refuse to enter a consent decree in such
an instance. It would thus seem that this language would pull
the rug out from under the current enforcement of the antitrust
laws.
93D CONGRESS
HOUSE OF REPRESENTATIVES
REPORT
2d Session
No. 93-1463
ANTITRUST PROCEDURES AND PENALTIES ACT
OCTOBER 11, 1974.-Committeed to the Committee of the Whole House on the
State of the Union and ordered to be printed
Mr. RODINO, from the Committee on the Judiciary,
submitted the following
REPORT
together with
ADDITIONAL VIEWS
[To accompany S. 782]
The Committee on the Judiciary, to whom was referred the bill
(S. 782) to reform consent decree procedures, to increase penalties
for violation of the Sherman Act, and to revise the Expediting Act
as it pertains to Appellate Review, having considered the same, report
favorably thereon with an amendment and recommend that the bill as
amended do pass.
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu thereof the
following:
That this Act may be cited as the "Antitrust Procedures and Penalities Act".
CONSENT DECREE PROCEDURES
SEC. 2. Section 5 of the Act entitled "An Act to supplement existing laws against
unlawful restraints and monopolies, and for other purposes", approved Oc-
tober 15, 1914 (15 U.S.C. 16), is amended by redesignating subsection (b) as (i)
and by inserting immediately after subsection (a) the following:
(b) Any proposal for a consent judgment submitted by the United
States for entry in any civil proceeding brought by or on behalf of the
United States under the antitrust laws shall be filed with the district
court before which such proceeding is pending and published by the
United States in the Federal Register at least 60 days prior to the
effective date of such judgment. Any written comments relating to
such proposal and any responses by the United States thereto, shall
also be filed with such district court and published by the United
States in the Federal Register within such sixty-day period. Copies
of such proposal and any other materials and documents which the
38-006
2
3
United States considered determinative in formulating such proposal,
shall also be made available to the public at the district court and in
views, evaluations, or advice of any individual, group or agency of govern-
ment with respect to any aspect of the proposed judgment or the effect of
such other districts as the court may subsequently direct. Simul-
such judgment, in such manner as the court deems appropriate;
taneously with the filing of such proposal, unless otherwise instructed
"(3) authorize full or limited participation in proceedings before the
by the court, the United States shall file with the district court, publish
court by interested persons or agencies, including appearance amicus curiae,
in the Federal Register, and thereafter furnish to any person upon
intervention as a party pursuant to the Federal Rules of Civil Procedure,
examination of witnesses or documentary materials, or participation in any
request, a competitive impact statement which shall recite-
other manner and extent which serves the public interest as the court
"(1) the nature and purpose of the proceeding;
may deem appropriate;
"(2) a description of the practices or events giving rise to the alleged
"(4) review any comments including any objections filed with the United
violation of the antitrust laws;
States under subsection (d) concerning the proposed judgment and the
"(3) an explanation of the proposal for a consent judgment, including an
responses of the United States to such comments and objections; and
explanation of any unusual circumstances giving rise to such proposal or
"(5) take such other action in the public interest as the court may deem
any provision contained therein, relief to be obtained thereby, and the antic-
appropriate.
ipated effects on competition of such relief;
"(g) Not later than 10 days following the date of the filing of any proposal
"(4) the remedies available to potential private plaintiffs damaged by
for a consent judgment under subsection (b), each defendant shall file with
the alleged violation in the event that such proposal for the consent judg-
the district court a description of any and all written or oral communications
ment is entered in such proceeding;
by or on behalf of such defendant, including any and all written or oral com-
"(5) a description of the procedures available for modification of such
munications on behalf of such defendant by any officer, director, employee, or
agent of such defendant, or other person, with any officer or employee of the
proposal; and
"(6) a description and evaluation of alternatives to such proposal actually
United States concerning or relevant to such proposal, except that any such
considered by the United States.
communications made by counsel of record alone with the Attorney General
"(c) The United States shall also cause to be published, commencing at least
or the employees of the Department of Justice alone shall be excluded from
60 days prior to the effective date of the judgment described in subsection (b)
the requirements of this subsection. Prior to the entry of any consent judg-
of this section, for 7 days over a period of 2 weeks in newspapers of general
ment pursuant to the antitrust laws, each defendant shall certify to the district
circulation of the district in which the case has been filed, in the District of
court that the requirements of this subsection have been complied with and
Columbia, and in such other districts as the court may direct-
that such filing is a true and complete description of such communications
"(i) a summary of the terms of the proposal for the consent judgment,
known to the defendant or which the defendant reasonably should have known.
"(ii) a summary of the competitive impact statement filed under sub-
(h) Proceedings before the district court under subsections (e) and (f) of
section (b),
this section, and the competitive impact statement filed under subsection (b)
"(iii) and a list of the materials and documents under subsection (b)
of this section, shall not be admissible against any defendant in any action
which the United States shall make available for purposes of meaningful
or proceeding brought by any other party against such defendant under the
public comment, and the place where such materials and documents are
antitrust laws or by the United States under section 4A of this Act nor con-
available for public inspection.
stitute a basis for the introduction of the consent judgment as prima facie
"(d) During the 60-day period as specified in subsection (b) of this section,
evidence against such defendant in any such action or proceeding."
and such additional time as the United States may request and the court may
grant, the United States shall receive and consider any written comments relat-
PENALTIES
ing to the proposal for the consent judgment submitted under subsection (b).
SEC. 3. Sections 1, 2, and 3 of the Act entitled "An Act to protect trade and
The Attorney General or his designee shall establish procedures to carry out
commerce against unlawful restraints and monopolies", approved July 2, 1890
the provisions of this subsection, but such 60-day time period shall not be short-
(15 U.S.C. 1, 2, and 3), are each amended by striking out "fifty thousand dollars"
ened except by order of the district court upon a showing that (1) extraordinary
whenever such phrase appears and inserting in each case the following: "five
circumstances require such shortening and (2) such shortening is not adverse
hundred thousand dollars if a corporation, or, if any other person, one hundred
to the public interest. At the close of the period during which such comments
thousand dollars".
may be received, the United States shall file with the district court and cause
EXPEDITING ACT REVISIONS
to be published in the Federal Register a response to such comments.
"(e) Before entering any consent judgment proposed by the United States
SEC. 4. (a) The first section of the Act of February 11, 1903 (15 U.S.C. 28;
under this section, the court shall determine that the entry of such judgment
49 U.S.C. 44), commonly known as the "Expediting Act", is amended to read
is in the public interest. For the purpose of such determination, the court may
as follows:
consider-
"SECTION 1. In any civil action brought in any district court of the United
"(1) the competitive impact of such judgment, including termination of
States under the Act entitled 'An Act to protect trade and commerce against
alleged violations, provisions for enforcement and modification, duration
unlawful restraints and monopolies', approved July 2, 1890, or any other Acts
of relief sought, anticipated effects of alternative remedies actually con-
having like purpose that have been or hereafter may be enacted, wherein the
sidered, and any other considerations bearing upon the adequacy of such
United States is plaintiff and equitable relief is sought, the Attorney General
judgment;
may file with such court, prior to the entry of final judgment, a certificate that,
"(2) the impact of entry of such judgment upon the public generally
in his opinion, the case is of general public importance. Upon filing of such
and individuals alleging specific injury from the violations set forth in the
certificate, it shall be the duty of the judge designated to hear and determine
complaint including consideration of the public benefit, if any, to be derived
the case, or the chief judge of the district court if no judge has as yet been desig-
from a determination of the issues at trial.
nated, to assign the case for hearing at the earliest practicable date and to cause
"(f) In making its determination under subsection (e), the court may-
the case to be in every way expedited.".
"(1) take testimony of Government officials or experts or such other
(b) Section 2 of the Act of February 11, 1903 (15 U.S.C. 29; 49 U.S.C. 45),
expert witnesses, upon motion of any party or participant or upon its own
commonly known as the Expediting Act, is amended to read as follows:
motion, as the court may deem appropriate;
"SEC. 2. (a) Except as otherwise expressly provided by this section, in every
"(2) appoint a special master and such outside consultants or expert
civil action brought in any district court of the United States under the Act
witnesses as the court may deem appropriate; and request and obtain the
entitled 'An Act to protect trade and commerce against unlawful restraints and
4
5
monopolies', approved July 2, 1890, or any other Acts having like purpose that
On March 12, 1974 the Subcommittee recommended S. 782 with
have been or hereafter may be enacted, in which the United States is the com-
plainant and equitable relief is sought, any appeal from a final judgment entered
amendments to the Full Committee by voice vote.
in any such action shall be taken to the court of appeals pursuant to sections
On October 8, 1974, the House Judiciary Committee, by voice vote
1291 and 2107 of title 28 of the United States Code. An appeal from an inter-
without objection, ordered reported S. 782, the Antitrust Procedures
locutory order entered in any such action shall be taken to the court of appeals
and Penalties Act, with one amendment in the nature of a substitute,
pursuant to sections 1292(a) (1) and 2107 of title 28, United States Code, but not
the language of which is the text of H.R. 17063. During hearings and
otherwise. Any judgment entered by the court of appeals in any such action shall
be subject to review by the Supreme Court upon a writ of certiorari as provided
mark-up by the Monopolies and Commercial Law Subcommittee, H.R.
in section 1254 (1) of title 28, United States Code.
9203 had been the proposed legislation considered: H.R. 17063 rep-
"(b) An appeal from a final judgment entered in any action specified in sub-
resented the amended version thereof, introduced by Chairman Rodino
section (a) shall lie directly to the Supreme Court if the Attorney General files
upon the unanimous agreement of the Members of the Monopolies
in the district court a certificate stating that immediate consideration of the ap-
peal by the Supreme Court is of general public importance in the administration
Subcommittee. S. 782 was passed unanimously by the Senate (92-0)
of justice. Such certificate shall be filed within 10 days after the filing of a notice
on July 18, 1973. H.R. 17063 differed from S. 782 in numerous respects
of appeal. When such a certificate is filed, the appeal and any cross appeal shall
most of which were either technical and conforming changes or a
be docketed in the time and manner prescribed by the rules of the Supreme Court.
redesignation of sections within the bill; however, several significant
The Supreme Court shall thereupon either (1) dispose of the appeal and any
additions and deletions were made to S. 782 as passed the Senate by the
cross appeal in the same manner as any other direct appeal authorized by law,
or (2) deny the direct appeal and remit the case to the appropriate court of
House Committee on the Judiciary.
appeals, which shall then have jurisdiction to hear and determine such case as
if the appeal and any cross appeal in such case had been docketed in the court
PURPOSES
of appeals in the first instance pursuant to subsection (a).".
The purposes of S. 782 are to enact legislative and oversight changes
APPLICATION OF EXPEDITING ACT REVISIONS
to settlements of Government civil antitrust cases with provisions
SEC. 5. (a) Section 401 (d) of the Communications Act of 1934 (47 U.S.C.
applicable to all parties in interest, namely, the Attorney General, the
(d) is repealed.
public, federal district courts, and defendants; to increase maximum
(b) Section 3 of the Act entitled "An Act to further regulate commerce with
allowable fines in Sherman Act cases (15 U.S.C. 1 et seq.) ; and, to
foreign nations and among the States", approved February 19, 1903 (32 Stat.
849; 49 U.S.C. 43), is amended by striking out the following "The provisions of
make a variety of changes in the Expediting Act (15 U.S.C. 28, 29)
an Act entitled 'An Act to expedite the hearing and determination of suits in
applicable to Government civil antitrust cases and to two other laws
equity pending or hereafter brought under the Act of July second, eighteen hun-
incorporating present Expediting Act procedures (47 U.S.C. 401 (d)
dred and ninety, entitled "An Act to protect trade and commerce against unlawful
and 49 U.S.C. 43-45) to improve or to accelerate the trial and appeal
restraints and monopolies," "An Act to regulate commerce," approved February
of public antitrust cases.
fourth, eighteen hundred and eighty-seven, or any other Acts having a like pur-
pose that may be hereafter enacted, approved February eleventh, nineteen
COST
hundred and three,' shall apply to any case prosecuted under the direction of the
Attorney-General in the name of the Interstate Commerce Commission".
The bill does not authorize appropriations for procedures enacted.
Revisions to consent decree procedures for the Justice Department and
EFFECTIVE DATE OF EXPEDITING ACT REVISIONS
federal district courts, except for costs of publishing public notice of
SEC. 6. The amendment made by section 4 of this Act shall not apply to an
pending proposals for a consent decree, do not entail procedures by
action in which a notice of appeal to the Supreme Court has been filed on or
these agencies not already authorized or for which added manpower
before the fifteenth day following the date of enactment of this Act. Appeal in any
or other new resources are necessary. Increases in fines for Sherman
such action shall be taken pursuant to the provisions of section 2 of the Act of
February 11, 1903 (32 Stat. 823), as amended (15 U.S.C. 29; 49 U.S.C. 45) which
Act violations will increase federal revenues but on a case by case de-
were in effect on the day preceding the date of enactment of this Act.
termination for which, therefore, an overall estimate is not possible.
Changes in judicial procedures for the movement of filed cases to trial
COMMITTEE ACTION
and for appeals in public civil antitrust cases are based, in part, on the
expectation that a significant conservation of judicial and of Justice
Your Committee, acting through its Monopolies and Commercial
Department resources and expenditures will occur.
Law Subcommittee, held four days of hearings from September 20,
1973 to October 3, 1973, on three bills relating to Antitrust Procedures
GENERAL STATEMENT AND ANALYSIS
and Penalties, the first of which was introduced in the House on
July 11, 1973 by Chairman Rodino. The Subcommittee received oral
The bill is composed, essentially, of three separate sections which are
and written testimony in those hearings from over fifteen witnesses
directed at different aspects of enforcement and application of anti-
including Members of Congress, the Deputy Assistant Attorney Gen-
trust laws by federal agencies and institutions the first Section relates
eral for Antitrust, the ex-Chairman of the Federal Trade Commission,
to procedures for settlements of Government civil antitrust cases; the
and numerous experienced and informed spokesmen for diverse in-
second Section increases fines allowable for Sherman Act violations;
dustries, the private and public antitrust bars, public interest groups,
and, the third Section improves pre-trial and appellate procedures in
and judicial procedures specialists.
public civil antitrust cases.
6
7
I. CONSENT DECREE PROCEDURES
to regularize and make uniform judicial and public procedures that
As an annual average since 1955, approximately 80 percent of anti-
depend upon the Justice Department's decision to enter into a proposal
trust complaints filed by the Antitrust Division of the Department of
for a consent decree. Moreover, the extant 30-day policy period is
Justice are terminated by pre-trial settlement; in two years during the
expanded by legislation to 60-days as a response to criticisms that
1955-1972 period, 100 percent of all judgments in public antitrust cases
30-days are insufficient for meaningful public analysis and comment of
resulted from utilization of the consent decree process. Given the high
both antitrust complaints and proposed consent decrees, especially in
rate of settlement in public antitrust cases, it is imperative that the
those situations where, despite Congressional criticism, the Justice
integrity of and public confidence in procedures relating to settlements
Department negotiates both the complaint and the proposed settle-
via consent- decree procedures be assured. The bill seeks precisely to
ment thereof and files them simultaneously in a district court.
accomplish this objective and focuses on the various stages of consent
Similarly, present Justice Department policy calls for the issuance
decree procedures, including that process by which proposed settle-
of a press release on the date on which a proposed consent decree is
ments are entered as a court decree by judicial action.
filed that advises the public of the terms of the proposed settlement;
Ordinarily, defendants do not admit to having violated the antitrust
describes the actions allegedly violative of the antitrust laws as ex-
or other laws alleged as violated in complaints that are settled. The
pressed in the complaint; and, invites public comment during the
antitrust laws express fundamental national legal, economic, and social
30-day period. The bill requires the Justice Department to file an
policy. Present law, 15 U.S.C. 16(a), encourages settlement by con-
sent decrees as part of the legal policies expressed in the antitrust laws.
containing: impact. statement with each of its proposals for a consent judgment
Consent decrees, unlike decrees entered as a result of litigation, are not
(1) The nature and purpose of the proceedings;
available as prima facie evidence against defendants in public anti-
(2) A description of the practices or events giving rise to the
trust cases in subsequent private antitrust cases. The bill preserves
alleged violation of the antitrust laws;
these legal and enforcement policies and, moreover, expressly makes
(3) An explanation of the proposal for a consent judgment,
judicial proceedings brought under the bill as well as the impact state-
including an explanation of any unusual circumstances giving rise
ment required to be filed prior thereto inadmissible against defendants
to such proposal or any provision contained therein, relief to be
of the public antitrust action in subsequent antitrust actions, if any.
thereby, and the anticipated effects on competition of such relief;
Various abuses in consent decree procedures by the Antitrust Division
(4) The remedies available to potential private plaintiffs dam-
and by district courts are, however, sought to be remedied as a matter
aged by the alleged violation in the event that such proposal for
of priority since as the Senate Report on the bill, Senate Report No.
the consent judgment is entered in such proceeding;
93-298, aptly observed, "by definition, antitrust violators wield great
(5) A description of the procedures available for.modification
influence and economic power." (p. 5).
of such proposal; and
The first three subsections of the bill, subsections 2(b)-(d), require
(6) A description and evaluation of alternatives to such pro-
the filing of an impact statement by the Justice Department along with
posal actually considered by the United States.
each proposal for a consent judgment offered by it to a federal district
Your Committee agrees with S. Rept. No. 93-298, "The bill seeks
court; provide mechanisms for notifying the public of such filings;
to encourage additional comment and response by providing more
and, allow public comment thereon and Justice Department responses
adequate notice to the public," (p. 5) but stresses that effective and
thereto within a specified period. In each of these areas, the Depart-
meaningful public comment is also a goal. The United States, there-
ment of Justice presently, as a matter of internal policy only, has ap-
fore, is charged with publishing a notice, at least 60 days prior to the
plicable procedures. When a proposal for a consent judgment is sub-
effective date of the consent judgment's becoming finalized and for
mitted to a district court: the defendant agrees that the proposal, as
filed, becomes binding and final on it within thirty days and that
containing: 7 days over a 2-week period in newspapers of general circulation,
during this period, it may not withdraw its consent; but, the Govern-
(1) A summary of the terms of the proposal for the consent
ment retains the right to withdraw its consent to entry of the decree
judgment,
at any time during the thirty-day period. This Justice Department
(2) A summary of the competitive impact statement filed;
"30-day" policy is relatively new, being introduced by former Attor-
(3) And a list of the materials and documents under subsection
ney General, the late Robert F. Kennedy, who was responding to a
(b) which the United States shall make available for purposes
critical 1959 Report by the House Antitrust Subcommittee that issued
of meaningful public comment, and the place where such mater-
as a result of House Resolution 107 of the 85th Congress and hearings
ials and documents are available for public inspection.
during the 85th and 86th Congresses in which nearly 4,500 pages of tes-
During the 60-day period, in addition, the United States is required to
timony on consent decree procedures were received. In the 1959 Report,
publish in the Federal Register its impact statement and its responses
the House Antitrust Subcommittee concluded, "The consent decree
to written comments received concerning the proposed consent judg-
practice has established an orbit in the twilight zone between estab-
ment. The legislation clearly prohibits a shortening of this 60-day
lished rules of administrative law and judicial procedures." The bill,
period unless the cognizant district court SO orders after it has been
in this respect, is designed to substitute "sunlight" for "twilight" and
shown: (1) Extraordinary circumstances require such shortening and
(2) such shortening is not adverse to the public interest.
8
9
The fourth and fifth subsections of the bill, Sections 2(e) and (f),
facilitate, thereby, future modifications to consent judgments under
relate entirely to judicial practices and procedures upon the submis-
appropriate judicial procedures that may become necessary, U.S. V.
sion to it of a proposal for a consent judgment and compliance by the
Armour & Co., 402 U.S. 673 (1971) and (3) in merger case settle-
Justice Department with procedures set forth in the first three sub-
ments, to insure that district courts adhere to Supreme Court direc-
sections of the bill. One of the abuses sought to be remedied by the
tions, "not only must we consider the probable effects of the merger
bill has been called "judicial rubber stamping" by district courts of
upon the economics of the particular markets affected but also we
proposals submitted by the Justice Department. The bill resolves
must consider its probable effects upon the economic way of life sought
this area of dispute by requiring district court judges to determine
to be preserved by the Congress," Brown Shoe Co. V. United States,
that each proposed consent judgment is in the public interest. Your
370 U.S. 294 (1962).
Committee agrees with S. Rept. No. 93-298's evaluation of this legis-
Section 2(f). is permissive in language whereby added legislative
lative requirement set forth in Section 2(e) of the bill
guidelines for the exercise of judicial discretion are provided. It is not
The Committee recognizes that the court must have broad
the intention of your Committee in any way to limit district courts
discretion to accommodate a balancing of interests. On the
to techniques enumerated therein. Nor it is intended to authorize tech-
niques not otherwise authorized by law. The legislative language, how-
one hand, the court must obtain the necessary information to
make its determination that the proposed consent decree is
ever, is intended to isolate further and, thereby, to preclude factors
in the public interest. On the other hand, it must preserve the
identified as contributing to the rise of the so-called abuse of "judicial
rubber stamping".
consent decree as a viable settlement option. It is not the intent
of the Committee to compel a hearing or trial on the public
The sixth subsection of the bill, Section (g) is the only provision
made applicable to defendants in public civil antitrust cases. Not later
interest issue. It is anticipated that the trial judge will ad-
than 10 days following the date of the filing of a proposal for a consent
duce the necessary information through the least compli-
judgment by the Justice Department, defendants are required to de-
cated and least time-consuming means possible. Where the
scribe all communications made by them or on their behalf but only in
public interest can be meaningfully evaluated simply on the
connection with cases sought to be settled by a consent decree. The
basis of briefs and oral arguments, this is the approach
only communications with any officer or employee of the Government
that should be utilized. Only where it is imperative that the
exempted from such requirements of this subsection are those made
court should resort to calling witnesses for the purpose of
by counsel of record for defendants who meet alone with members of
eliciting additional facts should it do SO.
the Department of Justice. The limited exemption provided reflects
Nor is Section 2(e) intended to force the government to go
a balancing test judgment distinguishing "lawyering" contacts of de-
to trial for the benefit of potential private plaintiffs. The pri-
fendants from their "lobbying contacts". Numerous contacts by counsel
mary focus of the Department's enforcement policy should be
of record with antitrust enforcers occur as an incident to the filing of
to obtain a judgment-either litigated or consensual-which
a case these, and these alone, are excepted from disclosure. A "lobby-
protects the public by insuring healthy competition in the
ing" contact includes a communication to antitrust enforcers by counsel
future. The Committee believes that in the majority of in-
of record accompanied by corporate officers or employees; or by at-
stances the interests of private litigants can be accommodated
torneys not counsel of record whether or not they are accompanied by
without the risk, delay and expense of the government going
officers or employees of defendants or prospective defendants in those
to trial. For example, the court can condition approval of
situations in which a simultaneous filing of a complaint and a pro-
the consent decree on the Antitrust Division's making avail-
posed settlement occurs. Although recognizing the difficulties of legis-
able information and evidence obtained by the government
lating legal ethics confining communications by counsel of record to
to potential, private plaintiffs which will, assist in the effective
"lawyering" and not "lobbying," your Committee intends to provide
prosecution of their claims. (pp. 6-7)
affirmative legislative action supporting the fundamental principle
Your Committee wishes to emphasize, in addition, that: (1) the
restated by the Supreme Court in the 1973 Civil Service Comm'n V.
public does have an interest in the integrity of judicial procedures
Letter Carriers decision, "[It] is not only important that the Govern-
incident to the filing of a proposed consent decree by the Justice De-
ment and its employees in fact avoid practicing political justice, but
partment and the case law in this regard is not disturbed; (2) case
it is also critical that they appear to the public to be avoiding it if
law that district courts cannot compel entry of proposed consent judg-
confidence in the system of representative Government is not to be
ments if the Justice Department resists such entry, and vice versa, is
eroded to a disastrous extent."
also not intended to be disturbed; and (3) legislative guidelines flow-
The seventh subsection of the bill expresses the Congressional judg-
ing from legislative oversight activity are appropriate even though
ment that impact statements required by and judicial proceedings
actual entry of the proposed consent judgment is an exercise of
that may result from enactment, shall be inadmissible in an action for
judicial power. Added legislative intentions in this regard are; (1)
damages, either by the government or by private parties. The subsec-
to foreclose future disputes following entry of the proposal as a con-
tion is also expressive of present law that consent judgments in public
sent judgment concerning decree language or the intentions of the
civil antitrust cases cannot be used as prima facie evidence of an anti-
parties, U.S. V. Atlantic Refining Co., 360 U.S. 19 (1959) ; (2) to
trust violation in private antitrust actions.
H. Rept. 93-1463-2
10
11
II. INCREASING SHERMAN ACT FINES
the appeal by the Supreme Court is of general public importance in
The second main section of the bill, Section 3, increases maximum
the administration of justice, whereup the Supreme Court may either:
allowable fines for violations of the Sherman Act from $50,000 to
(1) dispose of the appeal and any cross appeal in the same manner
$100,000 for individual and non-corporate business enterprises; and
as any other direct appeal authorized by law, or (2) deny the direct
to $500,000 for corporations. The last time that these fine provisions
appeal and remit the case to the appropriate court of appeals, which
were increased was in 1955. Near unanimous witness' testimony was
shall then have jurisdiction to hear and determine such case as if
received during hearings that revisions upward were long overdue.
the appeal and any cross appeal in such case had been docketed in
Indeed, some witnesses testified that fine ceilings sought were still too
the court of appeals in the first instance.
low since profits from antitrust violations can run into billions of
The exception provided for possible direct Supreme Court post-
dollars; and, since, by comparison, the Common Market imposes fines
trial review of litigated government civil antitrust cases reflects legis-
for antitrust violations in amounts up to 10 percent of the gross annual
lative recognition of the Attorney General's responsibilities to co-
sales volume of the defendant. Later during the same day that your
ordinate national antitrust enforcement policies and the necessary dis-
Committee approved the bill, President Ford called upon the Congress
cretion incident to this legislatively imposed responsibility and, that
to increase fines for antitrust violations by corporations to $1 million.
public antitrust cases differ in nature sufficiently from private anti-
trust cases and concerns to warrant providing the Attorney General
III. EXPEDITING ACT REVISIONS
with possible direct Supreme Court post-trial review in appropriate
cases. Moreover, the legislative conferral of discretion in post-trial ap-
The third main Section of the bill, Section 4, contains three major
peals on the Attorney General is expected to increase vigorous en-
substantive revisions to the Expediting Act of 1903.
forcement of the antitrust laws by the Department of Justice. It will,
The first such subsection, Sec. 4(a), relates to pre-trial procedures
also, provide opportunity for real appellate review of cases not worthy
and eliminates present provisions for convening three-judge courts
of direct Supreme Court review, both those cases never appealed for
upon the filing of public civil antitrust cases. Provided, instead, are
that reason as well as those appealed but summarily disposed of by
measures whereby, upon the filing of a certificate by the Attorney
the Supreme Court.
General that the case is of general public importance, district court
judges or chief judges of district courts are empowered to facilitate
PURPOSE OF AMENDMENT
and to speed up pre-trial procedures, including assignment of the case
for trial at the earliest practicable date. Present relevant law has been
In Section 2(b) of the bill, two express references to three portions
criticized as obstructing rather than expediting the movement of anti-
of the Freedom of Information Act, 5 U.S.C. § 552, in the Senate
trust cases from filing to trial. The bill is intended to eliminate po-
bill were not included in the Committee amendment. By deleting
tential and alleged clogs on antitrust litigation in this regard.
the piecemeal incorporation of the Freedom of Information Act it
The second major revision to the Expediting Act in this part of the
was intended to insure that, except for disclosures required by the bill,
bill contains two important provisions. First, intermediate appellate
Freedom of Information Act case law, substantive and procedural,
review for district court rulings on government motions for pre-trial
was not disturbed. In addition, the Freedom of Information Act in-
injunctions is provided, a procedure of particular importance in
tended to relate to the public's need for information from certain
merger cases. Under present law, such denials are interlocutory in
agencies and does not purport to deal with the need of the courts or of
nature and not reviewable until after trial. Judicial porcedures for
the Congress for information from those agencies. Thus reference
private antitrust cases, enacted much later than judicial procedures
to the Freedom of Information Act here would not only be inappro-
in public cases, presently provide for the pre-trial review that the bill
priate but would confuse the legislative history of that Act with regard
would establish for government cases. In addition to restoring a bal-
to its general applicability.
ance between public and private pre-trial procedures, the Committee
In section 2(e) of the bill, the Committee made one other note-
relied upon considerable testimony of witnesses during hearings that
worthy change. As originally expressed, district courts were charged
enactment would possibly conserve substantial enforcement resources
with determining that the entry of a proposal for a consent judgment
and, in view of the legal issues in merger cases, obviate the need for
was "in the public interest as defined by law." The four words, "as de-
some trials if such pretrial intermediate appellate review were en-
fined by law" were deleted as a recognition that the content of the
acted. Secondly, present law governing post-trial appeals of govern-
phrase, "public interest," is a product of judical construction in the
ment civil antitrust cases is changed SO that appeals from judgments of
context of particular statutes, as evidenced by the lack of definition
the district court will lie to the courts of appeals embracing the district
of the "public interest" in legal dictionaries and encyclopedias; to
in which the case was brought except as expressly provided in the
clarify the intention not to change case law construing the "public
bill.
interest" in cases involving the antitrust laws or antitrust provisions
The third main revision to the Expediting Act contained in this
of other laws; and'to provide illumination and consistency in the usage
part of the bill creates an exception to post-trial appellate procedures
of the phrase, the "public interest," in section 2(f) (5) of the bill.
for litigated government civil antitrust cases: a certificate may be
Preservation of antitrust precedent rather than innovation in the
filed with the Supreme Court stating that immediate consideration of
usage of the phrase, "public interest," is, therefore, unambiguous. The
12
13
original phrase either referred to "all law" and was too general or
Supreme Court while other cases may be appealed to the appropriate
referred to "antitrust law" and was too narrow in that the policy of
court of appeals. However, the Senate bill and Committee amendment
the antitrust laws as such would not admit of compromises made for
disagree as to what is the best mechanism for determining what cases
non-substantive reasons inherent in the process of settling cases
are cases of general public importance in the administration of jus-
through the consent decree procedure. See, for example, U.S. V.
tice. The Senate bill provides that the "district judge who adjudicated
Atlantic Refining Co., 360 U.S. 19(1959) U.S. v. Armour & Co., 402
the case," upon application of either party, would make that deter-
U.S. 673(1971).
mination. The Committee amendment provides that the Attorney Gen-
Wherever appearing in the bill, your Committee has substituted the
eral would make that determination.
word, "competitive" for the word, "public" in the phrase, "public im-
The Committee chose that mechanism because of the special ex-
pact statement" because: (a) the antitrust laws protect and promote
pertise of the Attorney General in administering the antitrust laws.
competition; (b), the expertise the Antitrust Division is charged by
Although the Senate bill would recognize that expertise in the Attor-
the Congress with institutionalizing focuses on "competitive" effects;
ney General at the trial stage in providing that he may certify that
(c) ambiguities arising from the usage of "public impact" in environ-
the case is "of general public importance" which should be expedited,
mental case law and statutes are foreclosed; (d) current proposals for
it has not equally recognized the Attorney General's expertise at the
inflationary "impact statements" might otherwise be thought to be
appellate stage. The Committee amendment, in contrast, recognizes
adopted which they are not except to the extent that the analysis of or
the Attorney General's expertise equally at both stages. It does SO in
the prediction of competitive effects in antitrust law traditionally en-
the belief that the Attorney General is in the best position to know
tail inflationary considerations; and (e) the substitutions refine and
how a given case affects other cases pending in other district courts
emphasize legislative purposes and guidelines for the contents of the
or cases that he plans to file at a later date. The district. judge is not
"impact statement" mandated by the bill.
in that position and since the Attorney General's certification will of
In subsection 2(e) (2) of the bill, one of the two legislative and
necessity be subjected to judicial scrutiny by the Supreme Court, the
judicial oversight guidelines expressed in permissive language in that
Committee believed it would be unnecessarily cumbersome to require
Section, further clarification of legislative intentions regarding the
the approval, as well, of the district judge. Moreover, as a matter of
district court's possible consideration of the impact of the entry of the
policy, the Committee intends that cases certified by the Attorney
proposed consent decree upon the public and upon individuals is pro-
General as cases of general public importance in the administration
vided by the addition of the words, "including consideration of the
of justice which the Supreme Court believes to be such be heard by
public benefit, if any, to be derived from a determination of the issues
that Court. In short, if the Attorney General and the Supreme Court
at trial." The addition accommodates further the interplay of legisla-
agree, the district judge's view should not be an obstacle to direct re-
tive guidelines with inherent judicial discretion. The words, "if any,"
view. Also, by mandating that only the "district judge who adjudi-
are added in recognition of the fact that among the diverse types of
cated the case" can enter the order to be reviewed by the Supreme
cases filed under the antitrust laws, there are some that, on their face
Court, an unintended loophole was created upon the death or other
and through a judicial examination of complaint and proposed consent
disability of the adjudicating judge, the opportunity for direct review
judgment, clearly do not require such a determination of impact by
is automatically foreclosed. Amendments to provide the participa-
courts. The added language expresses, further, the intentions of not
tion of district judges other than the district judge who adjudicated
replacing one mechanical procedure with another of a similar nature;
the case would be illusory no substitute for the experience gained in
of emphasizing the truism that in examining proposed settlements of
"deciding" the case could be legislated. Finally, the Committee was
particular cases, case by case judicial scrutiny is necessary; and, of
not persuaded as to the merits of the provision in the Senate bill
insuring that, in remedying the abuse of judicial rubber stamping of
whereby the defendant might request the district judge to certify the
proposed consent decrees, flexible judicial procedures evolve.
case for direct review. The Committee was of the opinion that a party
Language is added to Section 2(g) of the bill to insure that no loop-
by being sued did not become as expert as the Attorney General in
holes exist in the obligation-to disclose all lobbying contacts made by
determining the importance of the particular case to the whole of
defendants in antitrust cases culminating in a proposal for a consent
antitrust enforcement.
decree: only communication by counsel of record alone with the At-
Both the Senate bill and the Committee amendment agree that once
torney General or employees of the Department of Justice alone are
the mechanism for certification becomes operative and the case comes
excepted from reporting requirements. Conversely, communications
before the Supreme Court on direct review, the Supreme Court may
by counsel of record alone with officers or employees of all government
hear the case or remit it to the appropriate court of appeals. It should
agencies other than the Department of Justice are intended to be with-
be emhapsized that the fact that the Supreme Court is accorded this
in disclosure requirements.
option does not mean that the Supreme Court is intended to have a
Both the Senate bill and the Committee amendment agree that the
free and absolute discretion to hear or not hear a case on direct review.
Expediting Act provision insuring direct appeal to the Supreme
The Committee was well aware that under current law-Section 1254
Court in every government antitrust case wherein equitable relief is
of title 28, U.S. Code, which is not affected by this legislation-either
sought should be amended SO that only cases of general public impor-
party may by-pass the court of appeals and seek direct review by the
tance in the administration of justice may be appealed directly to the
Supreme Court. The Committee does not intend to duplicate or dis-
14
15
place that law through its amendment. Section 1254 does bestow on the
(3) an explanation of the proposad for a consent judgment,
Supreme Court an unqualified discretion to hear or not hear a case.
The Committee amendment does not. It is intended that the Supreme
including an explanation of any unusual circumstances giving
rise to such proposal or any provision contained therein, relief to
Court hear cases on direct review that are of general public importance
in the administration of the antitrust laws. Moreover, it is anticipated
be obtained thereby, and the anticipated effects on competition of
such relief;
that the Supreme Court will accord the certification of the Attorney
(4) the remedies available to potential private plaintiffs dam-
General due weight in view of his special expertise.
aged by the alleged violation in the event that such proposal for
The Committee amendment recognizes that public antitrust cases
the consent judgment is entered in such proceeding;
are unlike other federal cases, that they have an impact on the eco-
(5) a description of the procedures available for modification
nomic welfare of this nation, and that consequently they should be
treated accordingly.
of such proposal; and
(6) a description and evaluation of alternatives to such pro-
CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
posal actually considered by the United States.
(c) The United States shall also cause to be published, commeno-
In compliance with clause 3 of Rule XIII of the Rules of the House
ing at least 60 days prior to the effective date of the judgment de-
of Representatives, changes in existing law made by the bill, as re-
scribed in subsection (b) of this section, for 7 days over a period of
ported, are shown as follows (existing law proposed to be omitted is
2 weeks in newspapers of general circulation of the district in which
enclosed in black brackets, new matter is printed in italic, existing
the case has been filed, in the District of Columbia, and in such other
law in which no change is proposed is shown in roman)
districts as the court may direct-
(i) a summary of the terms of the proposal for the consent
SECTION 5 OF THE ACT OF OCTOBER 15, 1914
judgment,
(ii) a summary of the competitive impact statement filed under
SEC. 5. (a) A final judgment or decree heretofore or hereafter
subsection (b),
rendered in any civil or criminal proceeding brought by or on behalf
(iii) and a list of the materials and documents under subsection
of the United States under the antitrust laws to the effect that a
(b), which the United States shall make available for purposes
defendant has violated said laws shall be prima facie evidence against
of meaningful public comment, and the place where such ma-
such defendant in any action or proceeding brought by any other party
terials and documents are available for public inspection.
against such defendant under said laws or by the United States under
(d) During the 60-day period as specified in subsection (b) of
section 4A, as to all matters respecting which said judgment or decree
this section, and such additional time as the United States may re-
would be an estoppel as between the parties thereto: Provided, That
quest and the court may grant, the United States shall receive and
this section shall not apply to consent judgments or decrees entered
consider any written comments relating to the proposal for the con-
before any testimony has been taken or to judgments or decrees en-
sent judgment submitted under subsection (b). The Attorney General
tered in actions under section 4A.
or his designee shall establish procedures to carry out the provisions
(b) Any proposal for a consent judgment submitted by the United
of this subsection, but such 60-day time period shall not be shortened
States for entry in any civil proceeding brought by or on behalf of
except by order of the district court upon a showing that (1) extraor-
the United States under the antitrust laws shall be filed with the
dinary circumstances require such shortening and (2) such shorten-
district court before which such proceeding is pending and publish by
ing is not adverse to the public interest. At the close of the period
the United States in the Federal Register at least 60 days prior to
during which such comments may be received, the United States shall
the effective date of such judgment. Any written comments relating to
file with the district court and cause to be published in the Federal
such proposal and any responses by the United States thereto, shall
Register a response to such comments.
also be filed with such district court and published by the United
(e) Before entering any consent judgment proposed by the United
States in the Federal Register within such sixty-day period. Copies
States under this section, the court shall determine that the entry
of such proposal and any other materials and documents which the
of such judgment is in the public interest. For the purpose of such
United States considered determinative in formulating such proposal,
determination, the court may consider-
shall also be made available to the public at the district court and
(1) the competitive impact of such judgment, including term-
in such other districts as the court may subsequently direct. Simul-
ination of alleged violations, provisions for enforcement and
taneously with the filing of such proposal, unless otherwise instructed
modification, duration of relief sought, anticipated effects of alter-
by the court, the United States shall file with the district court publish
native remedies actually considered, and any other considerations
in the Federal Register, and thereafter furnish to any person upon
bearing upon the adequacy of such judgment;
request, a competitive impact statement which shall recite-
(2) the impact of entry of such judgment upon the public gen-
(1) the nature and purpose of the proceeding;
erally and individuals alleging specific injury from the violations
(2) a description of the practices or events giving rise to the
set forth in the complaint including consideration of the public
alleged violation of the antitrust laws;
benefit, if any, to be derived from a determination of the issues at
trial.
16
17
(f) In making its determination under subsection (e), the court
of action arising under said laws and based in whole or in part on any
may-
matter complained of in said proceeding shall be suspended during
(1) take testimony of Government officials or experts or such
the pendency thereof and for one year thereafter: Provided, however,
other expert witnesses, upon motion of any party or participant
That whenever the running of the statute of limitations in respect of
or upon its own motion, as the court may deem appropriate;
a cause of action arising under section 4 is suspended hereunder, any
(2) appoint a special master and such outside consultants or
action to enforce such cause of action shall be forever barred unless
expert witnesses as the court may deem appropriate; and request
commenced either within the period of suspension or within four years
and obtain the views, evaluations, or advice of any individual,
after the cause of action accrued.
group or agency of government with respect to any aspect of the
proposed judgment or the effect of such judgment, in such manner
as the court deems appropriate;
(3) authorize full or limited participation in proceedings be-
ACT OF JULY 2, 1890
fore the court by interested persons or agencies, including ap-
AN ACT To protect trade and commerce against unlawful restraints and
pearance amicus curiae, intervention as a party pursuant to the
monopolies
Federal Rules of Civil Procedure, examination of witnesses or
Be it enacted by the Senate and House of Representatives of the
documentary materials, or participation in any other manner and
United States of America in Congress assembled,
extent which serves the public interest as the court may deem
SECTION 1. Every contract, combination in the form of trust or
appropriate;
otherwise, or conspiracy, in restraint of trade or commerce among
(4) review any comments including any objections filed with
the several States, or with foreign nations, is hereby declared to be
the United States under subsection (d) concerning the proposed
illegal: Provided, That nothing herein contained shall render illegal,
judgment and the responses of the United States to such com-
contracts or agreements prescribing minimum prices for the resale
ments and objections; and
of a commodity which bears, or the label or container of which bears,
(5) take such other action in the public interest as the court
the trade mark, brand, or name of the producer or distributor of such
may deem appropriate.
commodity and which is in free and open competition with com-
(g) Not later than 10 days following the date of the filing of any
modities of the same general class produced or distributed by others,
proposal for a consent judgment under subsection (b), each defendent
when contracts or agreements of that description are lawful as
shall file with the district court a description of any and all written
applied to intrastate transactions, under any statute, law, or public
or oral communications by or on behalf of such defendant, including
policy now or hereafter in effect in any State, Territory, or the
any and all written or oral communications on behalf of such defend-
District of Columbia in which such resale is to be made, or to which
ant by any officer, director, employee, or agent of such defendant, or
the commodity is to be transported for such resale, and the making
other person, with any officer or employee of the United States con-
of such contracts or agreements shall not be an unfair method of
cerning or relevant to such proposal, except that any such communica-
competition under section 5, as amended and supplemented, f-the
tions made by counsel of record alone with the Attorney General or the
Act entitled "An Act to create a Federal Trade Commission, to define
employees of the Department of Justice alone shall be excluded from
its powers and duties, and for other purposes," approved September 26,
the requirements of this subsection. Prior to the entry of any consent
1914: Provided further, That the preceding proviso shall not make
judgment pursuant to the antitrust laws, each defendant shall certify
lawful any contract or agreement, providing for the establishment or
to the district court that the requirements of this subsection have been
maintenance of minimum resale prices on any commodity herein in-
complied with and that such filing is a true and complete description
volved, between manufacturers, or between producers, or between
of such communications known to the defendant or which the defend
wholesalers, or between brokers, or between factors, or between re-
ant reasonably should have known.
tailers, or between persons, firms, or corporations in competition with
(h) Proceedings before the district court under subsections (e) and
each other. Every person who shall make any contract or engage in
(f) of this section, and the competitive impact statement filed under
any combination or conspiracy hereby declared to be illegal shall be
subsection (b) of this section, shall not be admissible against any de-
deemed guilty of a misdemeanor, and, on conviction thereof, shall be
fendant in any action or proceeding brought by any other party
punished by fine not exceeding [fifty] five hundred thousand dollars
against such defendant under the anitrust laws or by the United States
if a corporation, or, if any other person, one hundred thousand dollars,
under section 4A of this Act nor constitute a basis for the introduction
or by imprisonment not exceeding one year, or by both said punish-
of the consent judgment as prima facie evidence against such defend-
ments, in the discretion of the court.
ant in any such action or proceeding.
SEC. 2. Every person who shall monopolize, or attempts to monop-
[(b)] (i) Whenever any civil or criminal proceeding is instituted
olize, or combine or conspire with any other person or persons, to
by the United States to prevent, restrain, or punish violations of any
monopolize any part of the trade or commerce among the several
of the antitrust laws, but not including an action under section 4A, the
States, or with foreign nations, shall be deemed guilty of a misde-
running of the statute of limitations in respect of every private right
meanor, and, on conviction thereof, shall be punished by fine not
H. Rept. 93-1463-3
18
19
exceeding [fifty] five hundred thousand dollars if a corporation, or,
hereafter may be enacted, wherein the United States is plaintiff and
if any other person, one hundred thousand dollars, or by imprisonment
equitable relief is sought, the Attorney General may file with such
not exceeding oneyear, or by both said punishments, in the discretion
of the court.
court, prior to the entry of final judgment, a certificate that, in his
opinion, the case is of general public importance. pon filing of such
SEC. 3. Every contract, combination in form of trust or otherwise,
certificate, it shall be the duty of the judge designated to hear and
or conspiracy, in restraint of trade or commerce in any Territory of
determine the case, or the chief judge of the district court if no judge
the United States or of the District of Columbia, or in restraint of
has as yet been designated, to assign the case for hearing at the earliest
trade or commerce between any such Territory and another, or be-
practicable date and to cause the case to be in every way expedited.
tween any such Territory or Territories and any State or States or
[SEC. 2. In every civil action brought in any district court of the
the District of Columbia, or with foreign nations, or between the
United States under any of said Acts, wherein the United States is
District of Columbia and an State or States or foreign nations, is
complainant, an appeal from the final judgment of the district court
hereby declared illegal. Every person who shall make any such con-
will lie only to the Supreme Court.
tract or engage in any such combination or conspiracy, shall be deemed
SEC. 2. (a) Except as otherwise expressly provided by this section,
guilty of a misdemeanor, and, on conviction thereof, shall be punished
in every civil action brought in any district court of the United States
by fine not exceeding [fifty] five hundred thousand dollars if a cor-
under the Act entitled "An Act to protect trade and commerce against
poration, or, if any other person, one hundred thousand dollars, or by
unlawful restraints and monopolies," approved July 2, 1890, or any
imprisonment not exceeding one year, or by both said punishments, in
other Acts having like purpose that have been or hereafter may be en-
the discretion of the court.
acted, in which the United States is the complainant and equitable
*
relief is sought, any appeal from a final judgment entered in any such
action shall be taken to the court of appeals pursuant to sections 1291
and 2107 of title 28 of the United States. Code. An appeal from an
AcT OF FEBRUARY 11, 1903
interlocutory order entered in any such action shall be taken to the
court of appeals pursuant to sections 1292(a) (1) and 2107 of title 28,
AN ACT To expedite the hearing and determination of suits in equity pending
United States Code, but not otherwise. Any judgment entered by the
or hereafter brought under the Act of July second, eighteen hundred and
court of appeals in any such action shall be subject to review by the
ninety, entitled "An Act to protect trade and commerce against unlawful re-
straints and monopolies," "An Act to regulate commerce," approved February
Supreme Court upon a writ of certiorari as provided in section 1254
fourth, eighteen hundred and eighty-seven, or any other Acts having a like
(1) of title 28, United States Code.
purpose that may be hereafter enacted
(b) An appeal from a final judgment entered in any action specified
Be it enacted by the Senate and House of Representatives of the
in subsection (a) shall lie directly to the Supreme Court if the Attor-
United States of America in Congress assembled, [That in any civil
ney General files in the district court a certificate stating that imme-
action brought in any district court of the United States under the
diate consideration of the appeal by the Supreme Court is of general
Act entitled 'An Act to protect trade and commerce against unlawful
public importance in the administration of justice. Such certificate
restraints and monopolies', approved July 2, 1890, 'An Act to regulate
shall be filed within 10 days after the filing of a notice of appeal.
commerce', approved February 4, 1887, or any other Acts having a like
When such a certificate is filed, the appeal and any cross appeal shall
purpose that hereafter may be enacted, wherein the United States is.
be docketed in the time and manner prescribed by the rules of the
plaintiff, the Attorney General may file with the clerk of such court a
Supreme Court. The Supreme Court shall thereupon either (1) dis-
certificate that, in his opinion, the case is of general public importance,
pose of the appeal and any cross appeal in the same manner as any
a copy of which shall be immediately furnished by such clerk to the
other direct appeal authorized by law, or (2) deny the direct appeal
senior circuit judge (or in his absence, the presiding circuit judge) of
and remit the case to the appropriate court of appeals, which shall
the circuit in which the case is pending (including the District of
then have jurisdiction to hear and determine such case as if the appeal
Columbia). Upon receipt of the copy of such cerificate, it shall be the
and any cross appeal in such case had been docketed in the court of
duty of the senior circuit judge or the presiding circuit judge, as the
appeals in the first instance pursuant to subsection (a).
case may be, to designate immediately three judges in such circuit, of
whom at least one shall be a circuit judge, to hear and determine
such case, and it shall be the duty of the judges SO designated to
SECTION 401 OF THE COMMUNICATIONS ACT OF 1934
assign the case for hearing at the earliest practicable date, to par-
ticipate in the hearing and determination thereof, and to cause the
TITLE IV-PROCEDURAL AND ADMINISTRATIVE PROVISIONS
case to be in every way expedited.]
SECTI ON 1. In any civil action brought in any district court of the
JURISDICTION TO ENFORCE ACT AND ORDERS OF COMMISSION
United States under the Act entitled 'An Act to protect trade and
commerce against unlawful restraints and monopolies," approved
SEC. 401. (a)
*
*
*
July 2, 1890, or any other Acts having like purpose that have been or
*
*
20
[(d) The provisions of the Expediting Act, approved February 11,
1903, as amended, and of section 238 (1) of the Judicial Code, as
amended, shall be held to apply to any suit in equity arising under
Title II of this Act, wherein the United States is complainant.]
ADDITIONAL VIEWS OF MR. HUTCHINSON
SECTION 3 OF THE AcT OF FEBRUARY 19, 1903
My additional views are confined to the first portion of S. 782, which
SEC. 3. That whenever the Interstate Commerce Commission shall
deals with consent decree procedures. Generally, this reform would
have reasonable ground for belief that any common carrier is engaged
require the Department of Justice to publish a competitive impact
in the carriage of passengers or freight traffic between given points at
statement in the Federal Register and receive public comment and
less than the published rates on file, or is committing any discrimina-
the defendant to reveal its "lobbying" contacts, all of which is to
tions forbidden by law, a petition may be presented alleging such
enable a court to determine whether a proposed consent decree is in
facts to the circuit court of the United States sitting in equity having
the "public interest."
jurisdiction; and when the act complained of is alleged to have been
These provisions might appear to satisfy those who believe that the
committed or as being committed in part in more than one judicial
Department of Justice is not to be trusted in exercising its prosecutor-
district or State, it may be dealt with, inquired of, tried, and deter-
ial discretion to settle antitrust cases. However, it should be pointed
mined in either such judicial district or State, whereupon it shall be
out that that discretion can be abused equally by refusing to file a
the duty of the court summarily to inquire into the circumstances,
complaint or by trying a case to completion. But such abuses are not
upon such notice and in such manner as the court shall direct and
reached by this legislation, presumably because an expansion of the
without the formal pleadings and proceedings applicable to ordinary
legislation to cover such situations would more clearly expose the de-
suits in equity, and to make such other persons or corporations parties
fect of the solution that is embraced.
thereto as the court may deem necessary, and upon being satisfied of
That defect is simply that to require federal courts to determine
the truth of the allegations of said petition said court shall enforce an
whether a consent decree is in the public interest is to transfer an
observance of the published tariffs or direct and require a discontinu-
"executive" question to the courts for resolution. The question for the
ance of such discrimination by proper order, writs, and process, which
court will be whether the Department of Justice has exercised its
said orders, writs, and process may be enforceable as well against
prosecutorial discretion well or, perhaps, as well as possible. The ques-
the parties interested in the traffic as against the carrier, subject to the
tion will not be whether the Department has violated some legal stand-
right of appeal as now provided by law. It shall be the duty of the sev-
ard. For none is established by this legislation. Rather, the court is
eral district attorneys of the United States, whenever the Attorney-
given a plenary and unqualified authority to re-decide an executive
General shall direct, either of his own motion or upon the request of the
decision.
Interstate Commerce Commission, to institute and prosecute such pro-
In our system of separated powers, the courts are to decide only
ceedings, and the proceedings provided for by this Act shall not pre-
"judicial" questions. Functionally, courts enforce executive and legis-
clude the bringing of suit for the recovery of damages by any party
lative decisions unless they violate a superceding legal standard, in
injured, or any other action provided by said Act approved February
which case they enforce that standard. But under our system, courts
fourth, eighteen hundred and eighty-seven, entitled An Act to regu-
do not determine what is wise or good for the American people. Such
late commerce and the Acts amendatory thereof. And in proceedings
determinations are reserved for the executive and legislative branches,
under this Act and the Acts to regulate commerce the said courts shall
which are answerable to the people.
have the power to compel the attendance of witnesses, both upon the
When a court reviews the exercise of prosecutorial discretion, it
part of the carrier and the shipper, who shall be required to answer
will find itself in a thicket of administrative considerations. It will
on all subjects relating directly or indirectly to the matter in contro-
have to decide how well the Department is utilizing its resources to
versy, and to compel the production of all books and papers, both of
enforce the antitrust laws, how important the legal issues are to future
the carrier and the shipper, which relate directly or indirectly to such
cases, how strong or how weak the Department's case is, how much
transaction. "The provisions of an Act entitled "An Act to expedite
time and manpower the particular case would consume if tried to
the hearing and determination of suits in equity pending or hereafter
completion, how much that trial would preclude other antitrust
brought under the Act of July second, eighteen hundred and ninety,
enforcement efforts, how much of the relief prayed for in the com-
entitled 'An Act to protect trade and commerce against unlawful
plaint would the Department obtain through the decree, and how
restraints and monopolies,' 'An Act to regulate commerce,' approved
much time would be saved by the entry of the decree. These adminis-
February fourth, eighteen hundred and eighty-seven, or any other
trative considerations, although they may involve legal questions,
Acts having a like purpose that may be hereafter enacted, approved
do not constitute, in my opinion, a judicial question.
February eleventh, nineteen hundred and three," shall apply to any
(21)
case prosecuted under the direction of the Attorney-General in the
name of the Interstate Commerce Commission.]
22
If it is assumed that it is necessary for someone to review the De-
partment's exercise of prosecutorial discretion to determine whether
it is in the public interest, it does not follow that the federal courts,
limited by the Constitution to deciding judicial questions, are the
appropriate reviewing agencies.
Under the Consttution, it is the Chief Executive who is charged
with the responsibility of reviewing and guiding the enforcement of
the laws. It is he who is charged with taking care that the laws be
faithfully executed.
Congress likewise has an oversight responsibilty to see how the
laws are enforced in order to determine if new laws are needed. It
was just such an exercise of responsibility by the House Committee
on the Judiciary in its report on the Consent Decree Program of the
Department of Justice in 1959 that prompted the Department to ini-
tiate reforms in its program.
Thus the actions of the Department of Justice are not without
their checks within the two branches responsible to the people. Con-
sistent with that, I endorse those provisions that permit greater
public knowledge of the Department's consent decree activities. But
I do not agree with those provisions which suggest that the question
of whether those activities are wise or good for the people, even in
particular cases, is a judicial question.
EDWARD HUTCHINSON.
U.S. House of Representatives
Republican Policy Committee
1616 Longworth Building
Rep. Barber B. Conable, Jr. (R-N.Y.),
Washington, D.C. 20515
Chairman
202-225-6168
93rd Congress
November 18, 1974
Second Session
Statement #13
S. 782 - The Antitrust Procedures and Penalties Act
The House Republican Policy Committee urges passage of S. 782, the
Antitrust Procedures and Penalties Act.
We advocate firm and vigorous enforcement of antitrust laws as a key
element of any effective long-term anti-inflationary economic policy.
Promotion of brisk business competition encourages lower prices for goods and
services and more creative and efficient companies.
Republican commitment to this objective is evidenced by the establishment
earlier this year of the House Republican Task Force on Antitrust and Monopoly
Problems. That group has urged prompt consideration and enactment of this bill.
Although we believe that all antitrust laws and regulatory practices
should be thoroughly reviewed, we welcome this modest bill as at least a good
first step in the direction of improving antitrust enforcement.
Some 80 percent of all antitrust complaints never come to trial but are
settled by consent decrees. S. 782 opens these pre-trial settlement
procedures to public scrutiny. Publication of the terms of consent decrees is
required at least 60 days before they become effective and mechanisms are
established for public comment and Justice Department response. The Justice
Department is required to file a "competitive impact statement" for each
consent judgment detailing the alleged violations, the proposed decree, the
remaining remedies for private persons damaged by the antitrust violations
and the alternatives considered to the proposed consent judgment. Federal
judges are to determine that proposed consent judgments are in the public
interest -- a provision intended to eliminate district court "rubber-stamping"
(OVER)
-2-
of proposals submitted by the Justice Department. To eliminate both the
appearance and the occurence of "political justice" in public civil antitrust
cases because of heavy lobbying, defendants are required to report all their
"lobbying" contacts in connection with the pending antitrust case.
The bill contains several provisions for expediting pre-trial and
appellate procedures to assure prompt action on antitrust complaints and to
prevent clogging the Supreme Court docket.
Finally, the bill increases the penalties for criminal violation of the
Sherman antitrust act.
The Policy Committee supports an amendment embodying President Ford's
October 8 suggestion that these penalties be set even higher. Under this
amendment, violation of the Sherman Act would be punishable as a felony with
an increased maximum sentence, while maximum fines would be one million
dollars for corporations and one hundred thousand dollars for individuals.
These stiff penalties are consistent with our belief that antitrust
violations should not be dismissed as merely misdemeanors or technical
violations; they cause greater economic injury to the public than do many
other felonies. Administering Increased jail sentences and higher fines
will deter individuals and companies from flouting antitrust prosecution
because the potential financial benefits outweigh the existing penalties.
Enactment of S. 782, amended to include increased penalties, will help
to curb commercial crimes that adversely Impact the economy and contribute
to rising prices. It will aid in assuring that antitrust settlements are in
the best public interest and will expedite and open to full public view the
procedures by which these settlements are reached.
We urge passage of S. 782.
DRAFT
DRAFT
DRAFT
DRAFT
S. 782 - The Antitrust Procedures and Penalties Act
The House Republican Policy Committee urges passage of S. 782, the Anti-
trust Procedures and Penalties Act.
We advocate firm and vigorous enforcement of antitrust laws as a key element
of any effective long-term anti-inflationary economic policy. Promotion of brisk
business competition encourages lower prices for goods and services and more
creative and efficient companies.
Republican commitment to this objective is evidenced by the establishment
earlier this year of the House Republican Task Force on Antitrust and Monopoly
Problems. That group has urged prompt consideration and enactment of this bill.
Although we believe that all antitrust laws and regulatory practices should
be thoroughly reviewed, we welcome this modest bill as at least a good first step
in the direction of improving antitrust enforcement.
Some 80 percent of all antitrust complaints never come to trial but are
settled by consent decrees. S. 782 opens these pre-trial settlement procedures
to public scrutiny. Publication of the terms of consent decrees is required at
least 60 days before they become effective and mechanisms are established for
public comment and Justice Department response. The Justice Department is
required to file a "competitive impact statement" for each consent judgment
detailing the alleged violations, the proposed decree, the remaining remedies
for private persons damaged by the antitrust violations and the alternatives
considered to the proposed consent judgment. Federal judges are to determine that
proposed consent judgments are in the public interest -- a provision intended
to eliminate district court "rubber-stamping" of proposals submitted by the
Justice Department. To eliminate both the appearance and the occurence of "poli-
tical justice" in public civil antitrust cases because of heavy lobbying,
defendants are required to report all their "lobbying" contacts in connection
with the pending antitrust case.
--2-
The bill contains several provisions for expediting pretrial and
appellate procedures to assure prompt action on antitrust complaints
and to prevent clogging the Supreme Court docket.
Finally, the bill increases the penalties for criminal violation
of the Sherman antitrust act.
The Policy Committee supports an amendment embodying President
Ford's Oct. 8 suggestion that these penalties be set even higher. Under
this amendment, violation of the Sherman Act would be punishable as a
felony with a maximum sentence of five years, while maximum fines would
be one million dollars for corporations and one hundred thousand dollars
for individuals.
These stiff penalties are consistent with our belief that antitrust
violations should not be dismissed as merely misdemeanors or technical
violations; they cause greater economic injury to the public than do many
other felonies. Administering increased jail sentences and higher fines
/
will deter individuals and companies from flouting antitrust prosecution
because the potential financial benefits outweigh the existing penalties.
Enactment of S. 782, amended to include increased penalties, will
help to curb commercial crimes that adversely impact the economy and
contribute to rising prices. It will aid in assuring that antitrust
settlements are in the best public interest and will expedite and open
to full public view the procedures by which these settlements are
reached.
We urge passage of S. 782.
December 11, 1974
CONGRESSIONAL RECORD-DAILY DIGEST
D 1355
Committée To Sit: Committee on the Judiciary rè-
Congress that Turkey is in compliance with the Foreign
ceived permission to sit during the 5-minute rule today.
Aid and Foreign Military Sales Acts (agreed to by a
Page H 11585
recorded vote of 297 ayes to 98 noes);
Antitrust Procedures and Penalties: House concurred
An amendment that prohibits all aid to UNESCO
in the Senate amendment to the House amendment to
until that organization refrains from adopting politically
S. 782, to reform consent decree procedures, to increase
oriented resolutions;
penalties for violation of the Sherman Act, and to revise
An amendment that limits military aid to South
the Expediting Act as it pertains to appellate review-
Korea to $145 million until the President certifies to
clearing the measure for the President.
Congress that progress is being made in expanding
human rights in that country (agreed to by a division
Pages H 11585-H 11586
vote of 64 ayes to 44 noes);
Late Reports: Committee on Public Works received
An amendment that limits military assistance to
permission to file reports by midnight tonight on the
Cambodia to $200 million and limits all aid to that
following bills: S. 3934, to authorize appropriations for
country to $377 million;
the construction of certain highways in accordance with
An amendment that adds language requiring the
title 23 of the United States Code; H.R. 17558, to amend
strengthening of international nuclear safeguards and
the act of May 13, 1954, relating to the Saint Lawrence
requires a report to Congress from the President on
Seaway Development Corporation to provide for a 7-year
the efforts being made in that area;
term of office for the Administrator; S, 4073, to extend
An amendment that authorizes an additional $25
certain authorizations under the Federal Water Pollu-
million for famine and disaster relief in Cyprus;
tion Control Act, as amended; and H.R. 17589, to desig-
An amendment that inserts "and until" after "unless"
nate the new Poe lock on the Saint Marys River at Sault
in a section prohibiting funds for CIA operations in
Sainte Marie, Mich., as the "John A. Blatnik lock."
foreign countries unless the President finds that those
Page H 11586
operations are necessary to American national security;
Real Estate Settlement Procedures: By a voice vote,
An amendment that adds language providing for the
the House-agreed to the conference report on S. 3164,
dispersal of assistance funds only if the receiving coun-
Real Estate Settlement Procedures Act of 1974-clearing
try agrees to trade strategic raw materials with the
the measure for the President.
Pages 11586-H
United States and providing for the stockpiling or sale
Farallon Wildlife Refuge: House concurred in the
of those materials by the Federal Government (agreed
Senate amendment to H.R. поз, to designate certain
to by a recorded vote of 244 ayes to 136 noes); and
lands in the Farallon National Wildlife Refuge, San
An amendment that adds a new section making it the
Francisco County, Calif.; as wilderness-clearing the
sense of Congress that any country in default of a debt
measure for the President,
Page H 11591
owed to the United States begin to pay off its debt.
Agriculture-Environmental and Consumer Pro-
Rejected:
tection Appropriations: It was made in order to con-
An amendment that sought to withhold security
sider tomorrow, December 12, or any day thereafter,
assistance funds from any state until the receiving coun-
the conference report on H.R. 16901, Agricuture-
try demonstrates that it is not violating human rights
Environmental and Consumer Protection Appropria-
by condoning such practices as torture or detention
tions for fiscal year 1975.
without charges;
Page H 11591
Foreign Assistance: By a yea-and-nay vote of 201 yeas
An amendment that sought to reduce funds for in-
to I90 nays, the House passed H.R. 17234, to amend
ternational organizations and programs by $26.6 million
the Foreign Assistance Act of 1961.
(rejected by a recorded vote of 165 ayes to 226 noes);
Rejected a motion to recommit the bill to the Com-
An amendment to the amendment limiting military
mittee on Foreign Affairs with instructions to report
assistance to Cambodia to $200 million and imposing a
it back to the House with a new section on Security
$377 million ceiling on all Cambodian aid that sought
Assistance and Human Rights prohibiting all aid
to raise the overall ceiling to $527 million and to strike
until the receiving country demonstrates that it is not
the $200 million limit on military aid (rejected by a
violating internationally recognized human rights by
division vote of 29 ayes to 54 noes);
condoning such practices as torture or imprisonment
An amendment to the Cambodia amendment that
without charge.
sought to strike the $200 million limit on military assist-
Agreed to:
ance and to exclude humanitarian and refugee assist-
An amendment that strikes $85 million for the pro-
ance from the $377 million ceiling;
curement of fertilizer by South Vietnam (agreed to by
An amendment that sought to add language allowing
a recorded vote of 291 ayes to 98 noes);
the President to withhold aid unless the receiving coun-
An amendment that provides for a complete cutoff
try agrees to trade strategic raw materials with the
of military aid to Turkey until the President certifies to
United States;
D 1356
CONGRESSIONAL RECORD- DAILY DIGEST
December 11, 1974
An amendment that sought to strike the section on
the following two measures under suspension of the
prohibitions on aid to nations trading with North
rules: conference report on H.R. 16136, military con-
Vietnam;
struction authorization; and H.R. 17597, Emergency
An amendment that sought to end all aid and mili-
Unemployment Compensation Act of 1974; consider
tary credit sales to India (rejected by a recorded vote
H.R. 16596, Emergency Jobs Act (open rule, I hour
of 159 ayes to 223 noes with I voting "present");
of debate); consider the following two bills under
An amendment that sought to insert "vital to the na-
suspension of the rules: H.R. 17085, Nurse Training,
tional defense" in lieu of "important to the national
and H.R. 17084, Health manpower; consider S.J. Res.
security" in a section allowing the President to approve
40, White House Conference on Libraries (open rule,
CIA operations in foreign countries;
I hour of debate), and H.R. 16204, Health Policy,
An amendment that sought to cut all funds authorized
Planning and Resources Development (open rule, I hour
by IO percent;
of debate).
An amendment that sought to add a new section on
control of Turkish opium;
Committee Meetings
An amendment that sought to reestablish the present.
$150 million ceiling on sales of military equipment to
COMMODITY FUTURES TRADING
Latin America;
COMMISSION ACT AMENDMENTS
An amendment that sought to reduce funds for inter-
Committee on Agriculture: Met and ordered reported
national organizations and programs by $13.4 million;
favorably to the House H.R. 17507, amended, to amend
and
the Commodity Futures Trading Commission Act of
An amendment that sought to limit contributions to
1974.'
the United Nations to $156 million.
Subsequently, this passage was vacated and S. 3394, a
SUGAR PRICES
similar Senate-passed bill, was passed in lieu after being
Committee on Agriculture: Subcommittee on Domestic
amended to contain the language of the House bill as
Marketing and Consumer Relations continued hearings
passed. The House then insisted on its amendment and
on sugar marketing conditions since defeat of sugar bill.
asked a conference with the Senate. Appointed as con-
Testimony was heard from public witnesses.
ferees: Representatives Zabłocki, Hays, Fascell,
Frelinghuysen, Broomfield, and Derwinski.
Hearings continue tomorrow.
Pages 11591 11653
BANK FAILURE
Privacy Protection: House passed amended S. 3418,
Committee on Banking and Currency: Subcommittee
to establish a Privacy Protection Commission, to provide
on Bank Supervision and Insurance continued hearings
management systems in Federal agencies and certain
on failure of United States National Bank of San Diego.
other organizations with respect to the gathering and
Testimony was heard from James Smith, Comptroller
disclosure of information concerning individuals.
of the Currency; and James Saxon, former Comptroller
Agreed to an amendment inserting the provisions of
of the Currency.
H.R. 16373, a similar House-passed bill. Agreed to
amend the title of the Senate bill. Pages H 11661-H 11666
Hearings continue tomorrow.
Late Reports: Committee on the Judiciary received
TORTURE IN BRAZIL
permission to file reports by midnight tonight on the
Committee on Foreign Affairs: Subcommittee on Inter-
following bills: S. 663, to improve judicial machinery by
national Organizations and Movements held a hearing
amending title 28, United States Code, with respect to
on torture and oppression in Brazil. Witnesses heard
judicial review of decisions of the Interstate Commerce
were Rev. Fred Morris, former United Methodist mis-
Commission; and S. 1083, to amend certain provisions
sionary in Recife, Brazil; and Rev. J. Bryan Hehir,
of Federal law relating to explosiver.
Page 111666
U.S. Catholic Conference.
Quorum Calls-Votes: One quorum call, one yea-and-
may vote, and five recorded votes developed during the
FOREST RESERVES LEASING
proceedings of the House today and appear on pages
Committee on Interior and Insular Affairs: Met and
H11586, Hri594-Hrr595, Нню4, Ниби, H11625-
ordered reported favorably to the House H.R. 10491
H11626, H11631, and H11639-Hr1640.
amended, providing for leasing of forest reserves for
Program for Thursday: Met at noon and adjourned at
commercial outdoor recreation purposes.
7:55 p.m. until noon on Thursday, December 12, when
The Committee discharged the Subcammittee on
the House will consider the conference report on
National Parks from further consideration of H.R. 2624,
H.R. 1690r, Agriculture-Environmental and Consumer
Hells Canyon National Forest Parklands, and the bill
Protection Appropriations for fiscal year 1975; consider
is now pending before the full committee.
December 11, 1974
CONGRESSIONAL RECORD-HOUSE
11585
cluded in the congressional program, has
for hearing at the earliest practicable date
The SPEAKER. Is there objection to
mentioned the RFC. The distinguished
and to cause the case to be in every way
the request of the gentleman from New
majority leader of the Senate, Hon.
expedited."
SEC. 5. Section 2 of that Act (15 U.S.C. 29;
Jersey?
MIKE MANSFIELD, in listing a number of
49 U.S.C. 45) is amended to read as follows:
Mr. HUTCHINSON. Mr. Speaker, re-
measures he thought should be adopted
"(a) Except as otherwise expressly pro-
serving the right to object-and I do not
by the Congress to try to save so many
vided by this section, in every civil action
intend to object-I would like to ask the
of our enterprises from disaster, spoke
brought in any district court of the United
chairman of the Committee on the Ju-
in favor of the RFC. In the economic
States under the Act entitled 'An Act to
diciary to explain the Senate amend-
statement made at the Democratic con-
protect trade and commerce against unlaw-
ment and tell us what it amounts to.
ference in Kansas City last weekend,
ful restraints and monopolies', approved July
enumerating measures that in their
2, 1890, or any other Acts having like pur-
Mr. RODINO. Mr. Speaker, if the gen-
pose that have been or hereafter may be en-
tleman will yield, I will be happy to ex-
opinion were necessary to preserve the
acted, in which the United States is the com-
plain the Senate amendment.
private enterprise system in this coun-
plainant and equitable relief is sought, any
Mr. Speaker, on December 9, 1974, the
try, and to aid the economy, one of the
appeal from a final judgment entered in
Senate agreed to the House amendment
essential measures proposed was the re-
any such action shall be taken to the court
to S. 782 with an amendment highly
constitution of the Reconstruction Fi-
of appeals pursuant to section 1291 and 2107
technical and extremely minor in nature.
nance Corporation.
of title 28 of the United States Code. Any
appeal from an interlocutory order entered
The Senate's action expressed agreement
Mr. Speaker, I invite the Members of
in any such action shall be taken to the
with virtually every provision and pol-
the House to join me in support of the
court of appeals pursuant to sections 1292 (a)
icy approved by the House, including
bill, H.R. 16677 to reconstitute the Re-
(1) and 2107 of title 28 of the United States
major amendments substantially in-
construction Finance Corporation which
Code but not otherwise. Any judgment en-
creasing punishment for Sherman Act
I have introduced. This bill should be
tered by the court of appeals in any such
offenses. Moreover, the Senate amend-
passed at once.
action shall be subject to review by the Su-
ment actually does not significantly
preme Court upon a writ of certiorari as pro-
vided in section 1254(1) of title 28 of the
change the intentions or will of the
PERMISSION FOR COMMITTEE ON
United States Code.
House as expressed in House Report 93-
THE JUDICIARY TO MEET TODAY,
"(b) An appeal from a final judgment pur-
1463 filed with the House on Ostober 11,
NOTWITHSTANDING CLAUSE 31,
suant to subsection (a) shall lie directly to
1974.
RULE XI OF THE RULES OF THE
the Supreme Court if, upon application of
The Senate amendment is confined to
HOUSE
a party filed within fifteen days of the filing
a change in procedures for posttrial ap-
of a notice of appeal, the district judge who
pellate review.
Mr. RODINO. Mr. Speaker, I ask unan-
adjudicated the case enters an order stating
imous consent that the Committee on
that immediate consideration of the appeal
At the time that S. 782 as amended was
the Judiciary be granted special leave
by the Supreme Court is of general public
placed before the House for its approval,
importance in the administration of jus-
both the House bill and the Senate ver-
to meet this afternoon, Wednesday, De-
tice. Such order shall be filed within thirty
sion thereof were in an agreement that
cember 11, 1974, without regard to clause
days after the filing of a notice of appeal.
present law providing for direct appeal of
31, rule XI of the Rules of the House.
When such an order is filed, the appeal and
litigated district court judgments by
The SPEAKER. Is there objection to
any cross appeal shall be docketed in the
either party to the Supreme Court ought
the request of the gentleman from New
time and manner prescribed by. the rules of
the Supreme Court. The Supreme Court shall
to be changed with appeals henceforth
Jersey?
thereupon either (1) dispose of the appeal
made to circuit courts.
There was no objection.
and any cross appeal in the same manner as
As an exception to this change in law
any other direct appeal authorized by law,
that both House and Senate versions ex-
ANTITRUST PROCEDURES AND
or (2) in its discretion, deny the direct
press and agree to, the House-approved
PENALTIES ACT
appeal and remand the case to the court of
bill would allow the Attorney General to
appeals, which shall then have jurisdiction
certify directly to the Supreme Court
Mr. RODINO. Mr. Speaker, I ask unan-
to hear and determine the same as if the
appeal and any cross appeal therein had
that immediate consideration of the ap-
imous consent to take from the Speak-
er's desk the Senate bill (S. 782) to re-
been docketed in the court of appeals in the
peal by the Supreme Court is of general
form consent decree procedures, to in-
first instance pursuant to subsection (a)."
public importance in the administration
SEC. 6. (a) Section 401 (d) of the Commu-
of justice. The Senate amendment re-
crease penalties for violation of the
nications Act of 1934 (47 U.S.C. 401 (d)) is
stores the version originally approved by
Sherman Act, and to revise the Expedit-
repealed.
the Senate whereby either party could
ing Act as it pertains to appellate review,
(b) Section 3 of the Act entitled "An Act
file for such direct Supreme Court review
with a Senate amendment to the House
to further regulate commerce with foreign
if the district judge who adjudicated the
amendment, and concur in the Senate
nations and among the States", approved
amendment.
February 19, 1903 (32 Stat. 849; 49 U.S.C. 43),
case enters an order to such effect.
The Clerk read the title of the Senate
is amended by striking out "proceeding."
The Senate amendment affords equal
bill.
and inserting in lieu thereof "proceeding."
opportunity for possible direct Supreme
and striking out thereafter the following:
Court review to either party to the case.
The Clerk read the Senate amendment
"Provided, That the provisions of an Act
This, I should add, is a position of fair-
to the House amendment, as follows:
entitled 'An Act to expedite the hearing and
ness already expressed in current law
Page 8, of the House engrossed amend-
determination of suits in equity pending or
whereby following the litigation, either
ment, strike out all after line 4 over to and
thereafter brought under the Act of July
party may file for direct review to the
including line 14 on page 11 and insert:
second, eighteen hundred and ninety, en-
SEC. 4. Section 1 of the Act of February 11,
titled "An Act to protect trade and commerce
Supreme Court with that court.
1903 (32 Stat. 823), as amended (15 U.S.C.
against unlawful restraints and monopolies,"
The requirement of the concurrence of
28; 49 U.S.C. 44), commonly known as the
"An Act to regulate commerce," approved
the district court judge had been elimi-
Expediting Act, is amended to read as fol-
February fourth, eighteen hundred and
nated in the House bill because it was
lows:
eighty-seven, or any other Acts having a like
the committee's intention, basically, to
"SECTION 1. In any civil action brought in
purpose that may be hereafter enacted, ap-
add safeguards against the filing of
any district court of the United States under
proved February eleventh, nineteen hundred
frivolous appeals and, thus, adding to
the Act entitled 'An Act to protect trade and
and three,' shall apply to any case prosecuted
commerce against unlawful restraints and
under the direction of the Attorney-Gen-
the Supreme Court's docket. The Senate
monopolies', approved July 2, 1890, or any
eral in the name of the Interstate Commerce
amendment, in effect, achieves the same
other Acts having like purpose that have
Commission".
result intended by the Judiciary Com-
been or hereafter may be enacted, wherein
SEC. 7. The amendment made by section 5
mittee by requiring an impartial, objec-
the United States is plaintiff and equitable
of this Act shall not apply to an action in
tive concurrence in the alleged impor-
relief is sought, the Attorney General may
which a notice of appeal to the Supreme
tance of the case by the judge who ad-
file with the court, prior to the entry of
Court has been filed on or before the fif-
judicated the case.
final judgment, a certificate that, in his
teenth day following the date of enactment
opinion, the case is of a general public im-
of this Act. Appeal in any such action shall
For these reasons, it is readily under-
portance. Upon filing of such certificate, it
be taken pursuant to the provisions of sec-
standable why the original Senate and
shall be the duty of the judge designated to
tion 2 of the Act of February 11, 1903 (32
House sponsors support the Senate
hear and determine the case, or the chief
Stat. 823), as amended (15 U.S.C. 29; 49
amendment; why representatives of the
judge of the district court if no judge has
U.S.C. 45) which were in effect on the day
President and of the Justice Department
as yet been designated, to assign the case
preceding the date of enactment of this Act.
have urged House acceptance of the
11586
CONGRESSIONAL HOUSE
December 11, 1974
Senate amendment; and why bipartisan
The SPEAKER. On this rollcall 354
Mr, PATMAN. Mr. Speaker, the legisla-
support for the Senate amendment has
Members have recorded their presence
tive agreement embodied in the confer-
been expressed by the members of the
by electronic device, a quorum.
ence report on S. 3164, the Real Estate
House Judiciary Committee and its
By unanimous consent, further pro-
Settlement Procedures Act of 1974, in my
Monopolies and Commercial Law Sub-
ceedings under the call were dispensed
view represents the best possible resolu-
committee.
with.
tion of the differences between the House
Mr. HUTCHINSON. Under the present
and Senate measures.
law, as I understand it, in an antitrust
PERMISSION FOR COMMITTEE ON
Almost without exception, the agree-
case, the losing party in the lower court
PUBLIC WORKS TO FILE CERTAIN
ment reached among the conferees re-
may file an appeal directly with the Su-
REPORTS
flects acceptance of the strongest con-
preme Court of the United States.
sumer protection provisions of both bills.
Mr. RODINO. That is correct.
Mr. ROE. Mr. Speaker, I ask unani-
On balance, the bill emerging from the
Mr. HUTCHINSON. Under the bill as
mous consent that the Committee on
conference constitutes a highly effective
passed by the House, it was intended
Public Works have until midnight to-
tool with which both home buyers and
that the Attorney General could deter-
night, December 11, 1974, to file reports
home sellers can protect their interests
mine whether or not an appeal should
on the following bills:
and their pocketbooks. I am certain that
go directly to the Supreme Court. In all
S. 3934, the Federal-Aid Highway
in the months and years ahead this
other cases an appeal would lie with the
Amendments of 1974;
measure will stand as a barrier to the de-
circuit court of appeals. Now, as I un-
H.R. 17558, to amend the act of
ceptive and fraudulent practices which
derstand it, the Senate amendment pro-
May 13, 1954, relating to the Saint
have bilked home buyers and home sell-
vides that the district judge who heard
Lawrence Seaway Act Development Cor-
ers of hundreds of millions of dollars.
the case will determine whether an ap-
poration to provide for a 7-year term of
The provisions of the bill are of partic-
peal shall lie directly to the Supreme
office for the Administrator, and for
ular importance to low- and moderate-
Court or whether the appeal will lie with
other purposes;
income families who have been drained
the circuit court of appeals; is that
S. 4073, to extend certain authoriza-
of hard-earned funds at the hands of
correct?
tions under the Federal Water Pollution
unscrupulous attorneys, appraisers, lend-
Mr. RODINO. That is correct.
Control Act, as amended, and for other
ers, title insurers, and others involved in
Mr. HUTCHINSON. With that expla-
purposes; and
the real estate settlement industry. In-
nation, Mr. Speaker, I withdraw my res-
H.R. 17589, to designate the new Poe
deed, abusive settlement practices have
ervation of objection, and I have no ob-
lock on the Saint Marys River at Sault
often resulted in robbing low- and mod-
jection to the Members of the House
Sainte Marie, Mich., as the "John A.
erate-ineome families of homeowner-
concurring with the Senate amendment.
Blatnick lock."
ship opportunities beeause they could
The SPEAKER. Is there objection to
The SPEAKER. Is there objection to
not afford inflated and unjustified
the request of the gentleman from New
the request of the gentleman from New
charges and fees they were required to
Jersey?
Jersey?
pay in order to purchase a home. In a
There was no objection.
There was no objection.
real sense, these unchecked abusive set-
(Mr. RODINO asked and was given
tlement practices mocked achievement
permission to revise and extend his re-
marks.)
REAL ESTATE SETTLEMENT COSTS
of our congressionally adopted national
housing goals, especially in the case of
The Senate amendment to the House
Mr. PATMAN. Mr. Speaker, I ask
low- and moderate-income families,
amendment was concurred in.
unanimous consent for the immediate
those most in need of decent dwellings
A motion to reconsider was laid on the
consideration of the conference report
in suitable living environments.
table.
on the Senate bill (S. 3164) to provide
Concerning major aspects of the re-
for greater disclosure of the nature and
port: Both the House and Senate bills
CALL OF THE HOUSE
costs of real estate settlement services,
contain provisions for the preparation
to eliminate the payment of kickbacks
and distribution of special information
Mr. GROSS. Mr. Speaker, I make the
and unearned fees in connection with
booklets to inform home buyers about the
point of order that a quorum is not pres-
settlement services provided in federally
nature and costs of real estate settlement
ent.
related mortgage transactions, and for
services. In this connection, the Senate
The SPEAKER. Evidently a quorum is
other purposes.
bill required that the average amount of
not present.
The Clerk read the title of the Senate
settlement costs in the region where the
Mr. ROGERS. Mr. Speaker, I move a
bill.
settlement is made be presented in the
call of the House.
The SPEAKER. Is there objection to
special booklets. The House bill did not
A call of the House was ordered.
the request of the gentleman from
contain such a requirement.
The call was taken by electronic de-
Texas?
Conferees agreed to accept the Senate
vice, and the following Members failed
There was no objection.
provision with an amendment which di-
to respond:
Mr. PATMAN. Mr. Speaker, I ask
rects HUD to conduct pilot demonstra-
[Roll No. 668]
unanimous consent that the statement
tion programs to determine the most
Alexander
Goldwater
O'Neill
Ashley
Grasso
Owens
of the managers be read in lieu of the
practical and efficient method to acquire
Barrett
Gray
Parris
report.
and analyze data in order to present to
Beard
Gubser
Passman
The SPEAKER. Is there objection to
home buyers the range of charges for
Blatnik
Hanley
Peyser
Brasco
the request of the gentleman from
Hansen, Idaho
Podell
settlement services in the housing mar-
Breaux
Hansen, Wash.
Rarick
Texas?
ket where the property to be purchased
Brown, Ohio
Harsha
Reid
There was no objection.
is located. HUD is to report its findings
Buchanan
Hays
Roncallo, N.Y.
The Clerk read the statement.
to Congress not later than July 1, 1976.
Burke, Calif.
Hebert
Rooney, N.Y.
Burton, John
Heckler, Mass.
Shoup
(For conference report and statement,
Mr. Speaker, the question at hand is
Carey, N.Y.
Holifield
Shuster
see proceedings of the House of Decem-
not whether HUD can report such infor-
Chisholm
Howard
Smith, N.Y.
ber 9, 1974.)
Clark
Jarman
mation to home buyers, but rather how
Staggers
Collier
Johnson, Colo.
Stark
Mr. PATMAN (during the reading).
it will acquire and analyze such infor-
Conable
Jones, N.C.
Steiger, Wis.
Mr. Speaker, I ask unanimous consent
mation for inclusion in the special in-
Davis, Ga.
Kemp
Teague
that the further reading of the statement
formation booklets. The conferees agreed
Dent
Huykendall
Thompson, N.J.
Diggs
Kyros
Tiernan
of the managers be dispensed with.
that disclosing the range of charges for
Dingell
Litton
Udall
The SPEAKER. Is there objection to
settlement services would be a highly
du Pont
Luken
Wiggins
the request of the gentleman from
desirable and useful shopping tool for
Esch
Mathias, Calif.
Wilson,
Texas?
Eshleman
Mills
Charles H.,
prospective home buyers. Moreover,
Fisher
Minshall, Ohio
Calif.
There was no objection.
HUD has already demonstrated its ca-
Ford
Moakley
Wyman
The SPEAKER. The Chair recognizes
pacity to obtain such information. It did
Gettys
Moorhead, Pa.
Young, Ga.
Giaimo
Murphy, N.Y.
the gentleman from Texas (Mr. PAT-
so in following a directive of the Emer-
Gibbons
O'Hara
MAN),
gency Home Finance Act of 1970 to de-