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UNITED STATES v. FIRST NATL. BANK OF SUNBURY

March 31, 1970

United States, plaintiff,
v.
The First National Bank of Sunbury and Snyder County Trust Co., defendants


Herman, D. J.


The opinion of the court was delivered by: HERMAN

HERMAN, District Judge.

 The court has before it a motion for summary judgment by the defendants, The First National Bank of Sunbury and Snyder County Trust Company, pursuant to Rule 56 of the Federal Rules of Civil Procedure.

 The government, plaintiff herein, instituted the within action claiming jurisdiction under Section 15 of the Act of Congress of October 15, 1914, c. 323, 38 Stat. 736, as amended (15 U.S.C. § 25), commonly known as the Clayton Act, and alleging violation of § 7 of the said act, 15 U.S.C. § 18 (1950)(formerly Ch. 323 § 7, 38 Stat. 7631 (1914)), which provides, in part:

 
"No corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share of the capital . . . of another corporation engaged also in commerce, wherein any line of commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly."

 The government alleges that the effect of the proposed merger between the two defendant banks may be to "substantially lessen competition" in a relevant line of commerce (commercial banking) in the "Susquehanna area" which is defined as the 4-county area consisting of Snyder, Northumberland, Union, and Montour counties or, in the alternative, the "Sunbury-Selinsgrove section of the Susquehanna Area," which is defined as "the area within five miles of the towns of either Sunbury or Selinsgrove."

 Within the Susquehanna area, First National, with total resources of approximately 34.8 million dollars, total deposits of 29.0 million dollars, and net loans and discounts of 18.2 million dollars, holds approximately 11% of the total deposits and 15% of the I.P.C. demand deposits, and is the largest commercial bank headquartered in the respective 4-county area. Snyder County Trust, with total resources of 19.1 million dollars, total deposits of 17.6 million dollars, and net loans and discounts of 11.4 million dollars, represents the third largest headquartered bank of the Susquehanna area with 6% of total deposits, and about 6% of the I.P.C. demand deposits.

 Comparatively, in the Sunbury-Selinsgrove section of the "Susquehanna Area " First National holds the largest share of deposits with about 44% of the total deposits in that area, and Snyder County Trust holds the second largest share with approximately 25% of the deposits.

 The government contends that the relative size of the merged banks alone would create a bank three times as large as the next largest bank in Northumberland County; twice as large as the next largest bank in Snyder County; three times as large as the next largest bank in Montour County, and four times as large as the next largest bank in Union County.

 The area involved herein is admittedly rural with population figures as of the 1960 census showing Union County with a population of 25,656; Snyder County, 25,942; Northumberland County, 104,138; and Montour County, 16,730. Commonwealth of Pennsylvania, Department of Property and Supplies, Vol. 99 The Pennsylvania Manual (1969).

 For the purposes of the motion for summary judgment, defendants have conceded all issues except that they contend that:

 
(1) Defendants First National Bank and Snyder County Trust Company are not substantial competitors in Union, Northumberland, and Montour counties.
 
(2) The remaining geographic areas to which the complaint relates, Snyder County and the twin 5-mile circle of Sunbury and Selinsgrove are not economically, demographically, and geographically significant to constitute a "section of the country" within the intendment of § 7.

 Defendants have submitted to the court for consideration affidavits consisting of the deposit breakdowns of Snyder County Trust Company and its accounts with Northumberland County addresses, including names and addresses; the deposit and loan breakdown of Snyder County Trust Company within the "Susquehanna Area"; the deposit and loan breakdown of First National Bank within the "Susquehanna Area"; and two affidavits by authorized representatives of the defendants instructing their ...


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