Marvin Yollin on the monies furnished by Ford through its Dealer Development Program at the time of the creation of East Hills Ford. Mr. Yollin contributed $60,000.00 and Ford contributed $240,000.00. Mr. Fulton substantiated the Plaintiff's contention that the entire transaction was worked out through Ford's Dealer Development Representative, Beecher Lingerfelt. He insisted that the only question which was raised regarding the Release had to do with some problems with a suit of Eazor Trucking against Three Rivers involving Ford warranties. Three Rivers asked for an exception which was subsequently put into the Release. Mr. Fulton further confirmed the fact that under the terms of the Buy-Sell Agreement with East Hills Ford, a general release had to be obtained in order to open up the new franchise. His only testimony with respect to the form of the Release was that since no question had been raised about it, there had been no discussion with Ford as to whether or not the transaction would have gone through if Three Rivers had refused to sign that particular form of release.
The Plaintiff asked the Court to consider the Affidavit of J. Norman Davis, stating that he was counsel for Three Rivers in 1969 and 1970 when the Ford Franchise was terminated; that the Release given by the Plaintiff in connection with that termination related only to matters having to do with the Franchise Agreement; that he was unaware of any anti-trust violations at that time, and did not contemplate or advise Three Rivers or any of its Officers of the possibility of an action against Ford for such violations; that the Release was "not intended as a release of unknown claims resulting from the violation of the antitrust laws." (Affidavit at P 9).
Between 1951 and 1965, Three Rivers had operated as a profitable Ford Dealership. Between 1966 and 1970, Three Rivers sustained an annual loss and, under Ford's Dealer Development Program, entered into a Buy-Sell Agreement with East Hills Ford. As part of the entire transaction there was included the execution of a General Release to Ford in the form set forth in Footnote 1. In this action, Three Rivers claims that Ford's sales restrictions, pricing policies, and various financing arrangements it had with other Dealers violated the antitrust laws, and that it was damaged as a result of Ford's unlawful activity. The Release purported to discharge Ford "of and from any and all manner of action and actions, cause or causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims and demands whatsoever in law, in admiralty or in equity . . . . upon or by reason of any manner, cause or thing whatsoever from the beginning of the world to the date of these presents . . ."
Under the Affidavits as filed and the testimony received at the Hearing on the Petition to Set Aside the Release, it was clearly established that Ford desired and secured a General Release. There was no indication of any fraud, accident, mistake or misrepresentation.
It is just as clear, however, that the matter of antitrust actions was not, in any way, a part of the negotiations which led to the Release; what concerned the parties was the purchase and sale of assets, any claims in relation thereto, as well as claims inter se concerning the dealership operations.
Three Rivers lost $42,782.00 in 1966, and at that time, through its President, attempted to terminate the Dealership. Ford refused to buy back new parts, accessories, and equipment inventory having an estimated value of $150,000.00. Following this refusal, Three Rivers rescinded its resignation and continued in business. Also in 1966, Ford advised Three Rivers that its facilities were inadequate and directed that new facilities be obtained. Three Rivers accordingly purchased a five acre tract of land in the Borough of Wilkinsburg, Pennsylvania, on which Ford (through its Realty Company) built a building and leased it to Three Rivers. Three Rivers moved into the new facility in September of 1968, after having registered a loss of nearly $10,000.00 in 1967. Three Rivers incurred a loss of $23,773.00 in 1968 and in 1969, again facing continued losses, Three Rivers resigned. Before accepting the resignation, however, Ford demanded the Release, which has been previously set forth, from Three Rivers. We must answer the question as to what effect should be given to the Release in regard to the present anti-trust action.
II. Applicability of Federal or State Law on the Interpretation of Releases
We begin this discussion with the principle that it is Congressional policy to rely heavily upon the private sector for enforcement of anti-trust laws. Zenith Radio Corp. v. Hazeltine Research, 401 U.S. 321, 336, 91 S. Ct. 795, 28 L. Ed. 2d 77 (1971); Minnesota Mining v. New Jersey Wood F. Co., 381 U.S. 311, 317-318, 85 S. Ct. 1473, 14 L. Ed. 2d 405 (1965). There is strong authority indicating that in view of this Federal policy, Federal law should wholly displace State law governing the release of anti-trust claims. In Zenith, supra, the Court assumed the question of whether the release of an anti-trust defendant released his co-conspirators as a matter to be determined without reference to particular state rules on releases. Cf. Dice v. Akron, C. & Y. R. Co., 342 U.S. 359, 72 S. Ct. 312, 96 L. Ed. 398 (1952) (Federal law held to govern releases of claims under the F.E.L.A.).
The Court in Zenith gave an extensive history of the various rules that have evolved concerning the release of one joint tortfeasor by an injured party and what rights remained against other joint tort-feasors who were not parties to the release. In discussing these rules, the Court stated: (28 L. Ed. 2d at pp. 95-97).
"Three rules have developed to deal with the question whether the release of one joint tortfeasor releases other tortfeasors who are not parties to or named in the release. The ancient common-law rule, which was grounded upon a formalistic doctrine that a release extinguished the cause of action to which it related, was that a release of one joint tortfeasor released all other parties jointly liable, regardless of the intent of the parties. See e.g., Western Express Co. v. Smeltzer, 88 F.2d 94, 95 (CA6 1937); American Ry. Express Co. v. Stone, 27 F.2d 8, 10 (CA1 1928); Barrett v. Third Avenue R. Co., 45 N.Y. 628, 635 (1871); Ellis v. Esson, 50 Wis. 138, 146, 6 N.W. 518, 519 (1880). While this Court has referred to this rule in cases where the rights of the litigants were controlled by state or federal common law, see Chicago & Alton R. Co. v. Wagner, 239 U.S. 452, 456-457, 60 L. Ed. 379, 381, 36 S. Ct. 135 (1915); United States v. Price, 50 U.S. 83, 9 How. 83, 92, 13 L. Ed. 56 (1850); Hunt v. Rhodes, 26 U.S. 1, 1 Pet. 1, 16, 7 L. Ed. 27 (1828); we are cited to no case where we have applied the rule to a statutory cause of action created under federal law. Indeed, we have expressly repudiated the rule. See Aro Mfg. Co. v. Convertible Top Co., 377 U.S. 476, 501, 12 L. Ed. 2d 457, 477, 84 S. Ct. 1526 (1964). Cf. Birdsell v. Shaliol, 112 U.S. 485, 489, 28 L. Ed. 768, 769, 5 S. Ct. 244 (1884). Moreover, in the lower federal courts, causes of action based upon federal statutes have generally been governed by one of the other two rules. The first of these rules provides that, although a release of one co-conspirator normally releases all others, it will not have such an effect if a plaintiff expressly reserves his rights against the others. This rule, which has been adopted with some variation by statute in 21 States, by judicial decision in others, see, e.g., McKenna v. Austin, 77 U.S. App. DC 228, 233-234, 134 F.2d 659, 664-665 (1943) (announcing D.C. law); Riley v. Industrial Finance Service Co. 157 Tex. 306, 311, 302 S.W. 2d 652, 655 (1957); and by the First Restatement, see Restatement, Torts § 885(1) (1939); has been applied in a number of antitrust cases. See, e.g., Miami Parts & Spring, Inc. v. Champion Spark Plug Co., 402 F.2d 83, 84 (CA5 1968); Twentieth Century-Fox Film Corp. v. Winchester Drive-In Theatre, Inc., 351 F.2d 925, 931 (CA9 1965); Dura Electric Lamp Co. v. Westinghouse Electric Corp., 249 F.2d 5, 6-7 (CA3 1957). It was this rule that the Court of Appeals followed in the opinion below. A final rule, which has gained support in several recent decisions and been adopted by the American Law Institute in a tentative draft of the Second Restatement of Torts, provides that the effect of a release upon coconspirators shall be determined in accordance with the intentions of the parties. See Winchester Drive-In Theatre, Inc. v. Twentieth Century-Fox Film Co., 232 F. Supp. 556, 561-563 (N.D. Cal. 1964), rev'd, Twentieth Century-Fox Film Corp. v. Winchester Drive-In Theatre, Inc., supra ; Young v. State, 455 P.2d 889 (Alaska, 1969); Breen v. Peck, 28 N.J. 351, 146 A.2d 665 (1958); Restatement (Second), Torts § 885(1) (Tent. Draft No. 16, 1970); 12 Vand. L. Rev. 1414, 1416-1417 (1959).
We recently adopted the final rule giving effect to the intentions of the parties in Aro Mfg. Co. v. Convertible Top Co., supra, a patent infringement case. The agreement in that case expressly provided for the release of Ford, its associated companies . . . its and their dealers, customers and users of its and their products' from all past and future infringement claims. 377 U.S., at 493, 12 L. Ed. 2d at 472. The document, however, did not expressly reserve the releasor's rights against anyone. The issue in the case was whether Aro, a contributory infringer which did not fit within any of the special categories enumerated in the release, was nonetheless liable for its past contribution to infringements. The District Court had found that the parties had not intended to release contributory infringers such as Aro, and, despite the absence of an express reservation of rights against such infringers, we accordingly held that Aro was not entitled to benefit from the release. We concluded that a release, which clearly intends to save the releasor's rights against a past contributory infringer, does not automatically surrender those rights. Id., at 501, 12 L. Ed. 2d at 477.