the allocation process. The court concluded that those activities were not independent of the underlying conspiracy and therefore did not support a claim for fraudulent concealment. Mere silence or nondisclosure, even by corporate officials, was not enough to state a claim of fraudulent concealment. Id. at 889.
Bethlehem contends, however, that a self-concealing conspiracy negates the need for allegations of affirmative conduct independent of the conspiracy. The issue here is therefore whether a conspiracy which by its nature is self-concealing can serve as a substitute for affirmative conduct by the defendants in satisfying the requirement of wrongful concealment. Addressing precisely this issue, the court in F. Buddie Contracting, Inc. v. Seawright, 595 F. Supp. 422 (N.D. Ohio 1984), held that a self-concealing conspiracy will suffice to meet the requirement of wrongful concealment. The court concluded that a self-concealing conspiracy is the logical equivalent of affirmative acts which conceal a plaintiff's claim; in both instances, the plaintiff lacks the opportunity to bring the claim because of its inability to discover it. I agree with the conclusions reached by the Buddie court. I can see no reason to distinguish between situations where a conspiracy is self-concealing and where plaintiff alleges affirmative conduct by the defendant to conceal wrongdoing.
The equitable tolling doctrine was first enunciated in Bailey v. Glover, 88 U.S. (21 Wall.) 342, 349, 22 L. Ed. 636 (1874), in which the Court held "that by concealing a fraud, or by committing a fraud in a manner that it concealed itself until such time as the party committing the fraud could plead the statute of limitations to protect it, is to make the law which is designed to prevent fraud the means by which it is made successful and secure." Bailey, therefore, established the concealment and diligence elements of the present day doctrine of fraudulent concealment and suggested that self-concealing frauds could satisfy the concealment aspect of the doctrine. The Court further held that "when there has been no negligence or laches on the part of a plaintiff in coming to the knowledge of a fraud which is the foundation of the suit, and when the fraud has been concealed, or is of such character as to conceal itself, the statute does not begin to run until the fraud is discovered by, or becomes known to, the parties suing, or those in privity with him." Id. 349-50.
The Bailey court was clearly concerned that a party, who remains in ignorance of an injury through no fault or want of diligence of its own and because of the conduct of the offending party, not be barred from filing suit to remedy the injury. The same concern supports plaintiff's contention that a self-concealing conspiracy tolls the statute of limitations until such time as the plaintiff, through the exercise of diligence, becomes aware of the conspiracy. If the conspiracy conceals itself, it would be anomalous to require plaintiff to allege affirmative acts by defendants to conceal the conspiracy because such acts would be unnecessary and therefore never performed. As the Buddie court aptly concluded, defendants would be rewarded for engaging in a successful conspiracy; because no affirmative acts independent of the conspiracy would be necessary to maintain concealment, plaintiffs would never be able to pursue an action for the conspiratorial conduct.
I note, however, that there is an important distinction between tolling the statute of limitations because of the failure to discover and tolling the limitation period because the parties who engaged in unlawful conduct are successful. The former clearly does not constitute fraudulent concealment; the mere failure by defendant to disclose to a plaintiff the existence of facts does not establish the defense. Therefore, I agree with the conclusion in State of Colorado v. Western Paving Construction Co., 630 F. Supp. 206, 209 (D. Colo. 1986), that due diligence is not sufficient to establish the defense of fraudulent concealment. However, the essence of my holding here is that defendants may wrongfully or fraudulently conceal their conduct either through affirmative acts or by successfully executing a conspiracy which by its very nature is self-concealing.
There is support for this conclusion in several cases upon which defendants and the Lake Asphalt court rely for the opposite conclusion. In In Re Fertilizer Antitrust Litigation, 1979-2 Trade Cases (CCH) § 62,894 (E.D. Wash. 1979), the court, concluding that it was proper to dismiss those claims antedating the four year period prior to the filing of plaintiffs complaint, rejected plaintiff's contention that there was fraudulent concealment based on conduct that was self-concealing. Plaintiffs' allegations as to self-concealment were conclusory and therefore defective under Fed.R.Civ.P. 9(b). The court, however, implicitly recognized that self-concealing conduct could satisfy the wrongful concealment aspect of the doctrine.
In King & King Enterprises v. Champlin Petroleum Co., 657 F.2d 1147, 1154 (10th Cir. 1981), the court cited with approval language from Ashland Oil Co. of California v. Union Oil Co. of California, 567 F.2d 984 (T.E.C.A. 1977), cert. denied, 435 U.S. 994, 56 L. Ed. 2d 83, 98 S. Ct. 1644 (1978), to the effect that a statute of limitations is tolled when acts causing injury are fraudulently concealed or where the acts are of a nature to conceal themselves. In King, however, the plaintiff had alleged acts of fraudulent concealment rather than a self-concealing fraud; the court only considered the standard of proof for acts of concealment.
Finally, debate in the House of Representatives prior to the enactment of § 4B of the Clayton Act clearly reflects the intention of Congress that a self-concealing conspiracy would satisfy the wrongful concealment element of the doctrine of fraudulent concealment.
Mr. Patman: Does the 4 years apply to conspiracy cases? Suppose there is a conspiracy, and it is 10 years before the conspiracy is know.
Mr. Celler: In the case of conspiracy or fraud, the statute only runs from the time of discovery.