D.C. Civil Action No. 70-729 APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA.
Van Dusen, Aldisert, and Rosenn, Circuit Judges.
Plaintiffs, scrap metal dealers, brought an antitrust suit under Section 4 of the Clayton Act by which they sought treble damages for alleged violations commencing as early as 1946 of Sections 1 and 2 of the Sherman Act and Section 7 of the Clayton Act. Defendants sought by a motion for summary judgment to bar all claims for damages accrued before October 10, 1965, due to the running of the statute of limitations. The opinion and order of the United States District Court for the Eastern District of Pennsylvania 336 F. Supp. 1238, rejected in general defendants-appellants' motion and barred only damage claims accrued before January 1, 1952. The appeal challenges the district court's disposition of that motion.*fn1 We affirm.
Plaintiffs-appellees, Luria Steel & Trading Corporation and Hyman-Michaels Company ("Luria"), filed a complaint in the district court on October 10, 1969, alleging violations of Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2, and Sections 3 and 7 of the Clayton Act, 15 U.S.C. §§ 14 and 18. Defendants-appellants, the Ogden Corporation, three of its subsidiaries, and William J. Luria, moved for summary judgment barring all damages accrued more than four years before filing of the suit on the basis of the applicable four year statute of limitations provided by Section 4B of the Clayton Act, 15 U.S.C. § 15b. In opposing the motion, Luria relied on Section 5(b) of the Clayton Act, 15 U.S.C. § 16(b), which suspends the running of the statute during the pendency of "any civil or criminal proceeding . . . instituted by the United States to prevent, restrain, or punish violations of any of the antitrust laws . . . and for one year thereafter."*fn2 Luria contended a Federal Trade Commission (F.T.C.) proceeding, pending from January 19, 1954, to October 14, 1968, suspended the running of the statute on the claims for which suit was begun October 10, 1969.
The Federal Trade Commission initiated proceedings on January 19, 1954, against scrap metal dealer and broker Luria Brothers & Company*fn3 for violations of Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45, and Section 7 of the Clayton Act, 15 U.S.C. § 18. Two years later Luria Brothers was purchased by the defendant, Ogden Corporation. By stipulation, on March 9, 1956, the purchasing Ogden subsidiary, Luria Brothers & Co., Inc., was added as a respondent to the F.T.C. proceeding. The Commission found violations of F.T.C. Act § 5 and Clayton Act § 7 in 1962, Luria Brothers and Co., 62 F.T.C. 243 (1962); and this court affirmed, Luria Brothers & Co. v. Federal Trade Commission, 389 F.2d 847 (3d Cir. 1968). Luria Brothers was found to have violated F.T.C. Act § 5 by entering agreements with various steel mills which restrained trade and tended to create a monopoly and to have violated Clayton Act § 7 by acquisition of a competitor. 389 F.2d at 852. Luria Brothers appealed this court's finding of a violation of F.T.C. Act § 5, but not the finding of a violation of Clayton Act § 7. Certiorari was denied on October 14, 1968. 393 U.S. 829, 89 S. Ct. 94, 21 L. Ed. 2d 100 (1968).
The district court opinion in the present case, relying on this court's opinion in New Jersey Wood Finishing Co. v. Minnesota Mining & Manufacturing Co., 332 F.2d 346, 359 (3d Cir. 1964), aff'd, 381 U.S. 311, 14 L. Ed. 2d 405, 85 S. Ct. 1473 (1965), determined that F.T.C. proceedings to enforce the F.T.C. Act cannot toll the statute of limitations, but F.T.C. proceedings to enforce the Clayton Act may. It therefore found the 1954 F.T.C. proceeding against Luria Brothers, in alleging Clayton Act § 7 violations, tolled the statute of limitations. It further held the statute was tolled until October 14, 1968, the date when certiorari was denied, even though only the F.T.C. Act violation was appealed from our decision.*fn4
In determining on what date the statute was originally tolled, the district court reasoned that F.T.C. proceedings could not have such an effect until January 1, 1956, the date on which various amendments to Section 5 of the Clayton Act became effective.*fn5 The court thus barred all claims for damages accrued before January 1, 1952, four years before the statute was tolled. The district court refused to find the statute tolled on any other date for any of the named defendants on the grounds advanced that individuals cannot be sued under the Clayton Act or that the named corporate defendants were not in the scrap metal business when the F.T.C. proceeding began.
Defendants contend that the district court order cannot be sustained, because (1) as held by the district court, F.T.C. proceedings to enforce the F.T.C. Act do not suspend the running of the statute of limitations; and (2) contrary to the holding of the district court, F.T.C. proceedings begun in 1954 to enforce violations of the Clayton Act could not suspend the running of the statute. In support of the second contention, appellants rely on this court's opinion in New Jersey Wood, supra, 332 F.2d at 348. They note that until 1959, when the Finality Act was passed by Congress, 73 Stat. 243 (1959), 15 U.S.C. § 21, Commission orders based on Clayton Act violations were not enforceable until approved by a court of appeals. They argue that before 1959, F.T.C. proceedings were therefore not "civil or criminal proceeding[s]" which under Section 5(b) of the Clayton Act suspended the running of the statute of limitations. And, they argue that passage of the Finality Act of 1959 did not transform proceedings begun before that time into "civil or criminal proceedings." Federal Trade Commission v. Jantzen, Inc., 386 U.S. 228, 18 L. Ed. 2d 11, 87 S. Ct. 998 (1967).
Plaintiffs contend that the statute was tolled in 1954 on the basis either (1) that F.T.C. proceedings to enforce the F.T.C. Act tolled the statute, or (2) F.T.C. proceedings to enforce the Clayton Act tolled the statute.
Consideration of whether the statute of limitations was tolled in 1954 by reason of the F.T.C.'s proceeding to enforce either F.T.C. Act § 5 or Clayton Act § 7 must begin with the Supreme Court's opinion in Minnesota Mining & Manufacturing Co. v. New Jersey Wood Finishing Co., 381 U.S. 311, 14 L. Ed. 2d 405, 85 S. Ct. 1473 (1965). The holding of New Jersey Wood was that an F.T.C. proceeding begun in 1960, alleging violations of Clayton Act § 7, tolled the statute of limitations pursuant to Clayton Act § 5(b). The holding in New Jersey Wood does not necessarily control the present case because it did not deal with F.T.C. proceedings brought to enforce ...