United States v. Union Oil Company of California

343 F.2d 29 UNITED STATES of America, Appellant, v. UNION OIL COMPANY OF CALIFORNIA, Appellee. No. 19179. United States Court of Appeals Ninth Circuit. March 18, 1965. Wm. H. Orrick, Jr., Asst. Atty. Gen., Robert B. Hummel, Geo. R. Kucik, attys., Dept. of Justice, Washington, D. C., Stanley E. Disney, Atty., Dept. of Justice, Los Angeles, Cal., for appellant. Moses Lasky, Richard Haas, Joseph M. Livermore, Brobeck, Phleger & Harrison, San Francisco, Cal., L. A. Gibbons, Los Angeles, Cal., for appellee. Before ORR, JERTBERG and MERRILL, Circuit Judges. ORR, Circuit Judge: 1 On August 19, 1963, the Department of Justice of the United States issued a Civil Investigative Demand to the Union Oil Company of California. The demand recited that it was issued pursuant to the Antitrust Civil Process Act (herein ACPA), 15 U.S.C. §§ 1311-1314 , and requested documents relating to an investigation of "proposed acquisitions of fertilizer companies by petroleum companies", for the purpose of "ascertaining whether there is or has been a violation of the provisions of [Section 7 of the Clayton Act]". 1 2 On August 27, 1963, pursuant to Section 5(b) of the ACPA, 15 U.S.C. § 1314…

On August 19, 1963, the Department of Justice of the United States issued a Civil Investigative Demand to the Union Oil Company of California. The demand recited that it was issued pursuant to the Antitrust Civil Process Act (herein ACPA), 15 U.S.C. §§ 1311-1314 , and requested documents relating to an investigation of “proposed acquisitions of fertilizer companies by petroleum companies”, for the purpose of “ascertaining whether there is or has been a violation of the provisions of [Section 7 of the Clayton Act]”. 1

On August 27, 1963, pursuant to Section 5(b) of the ACPA, 15 U.S.C. § 1314 (b), Union filed a petition in the United States District Court for the Southern District of California to have the demand set aside. The petition contained six grounds. It was granted upon the ground that the ACPA may not be used to investigate prospective acquisitions, which, if consummated, might violate Section 7 of the Clayton Act.

For purposes of this opinion we assume, without deciding, that the demand made was upon a “person under investigation”, that it was sufficiently definite and certain, and that it otherwise constituted a proper request for the production of documents which…

(concurring) :

I would agree that acquisitions which have not progressed beyond mere contemplation or consideration or a subjective judgment to proceed cannot be made the subject of a § 1312 civil investigative demand. In the light of that proposition, “proposed acquisitions” is a most equivocal term since it may well be directed to such situations. I therefore agree that the demand in suit is not subject to enforcement and was properly set aside.

However, I disagree with the majority opinion in permitting the demand only as to an accomplished acquisition — one beyond the reach of preventive injunction. This, in my judgment, reads the Antitrust Civil Process Act with unnecessary strictness.

In my view the business of acquiring encompasses more than the formal corporate resolutions finally accomplishing the acquisition. If companies are engaged in activities leading to that end which they can under the antitrust laws be halted from pursuing I would say that they are presently engaged in the process of acquiring and accordingly are presently in the process of violating the antitrust laws,