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SUPREME COURT OF THE UNITED STATES

Syllabus

UNITED STATES v. SOCONY-VACUUM OIL CO., INC. ET AL.

310 U.S. 150

Argued February 5, 6, 1940 -- Decided May 6, 1940

CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT.

Together with No. 347, Socony-Vacuum Oil Co., Inc. et al. v. United States, also on writ of certiorari (308 U.S. 540) to the Circuit Court of Appeals for the Seventh Circuit.

Certiorari, 308 U.S. 540, on cross-petitions, to review the rulings of the court below in a case involving the indictment and conviction of corporations and individuals for a conspiracy in violation of 1 of the Sherman Anti-Trust Act. The opinion of the District Court is reported in 23 F.Supp. 937.

1. Agreements to fix prices in interstate commerce are unlawful per se under the Sherman Act; and no showing of so-called competitive abuses or evils which the agreements were designed to eliminate or alleviate may be interposed as a defense. Pp. 210, 218.

2. Numerous oil companies and individuals were convicted under an indictment alleging that, in violation of 1 of the Sherman Act, they conspired to raise and maintain spot market prices of gasoline, and prices to jobbers and consumers in the "Midwestern Area," embracing many States, by buying up "distress" gasoline on the spot markets and eliminating it as a market factor. In support of allegations of the indictment, there was evidence to prove that the defendants, with intent to raise and maintain prices, devised and carried out an organized program of regularly ascertaining the amounts of surplus spot market gasoline, of assigning its sellers to buyers who were in the combination, and of purchasing it at fair going market prices, and that this process, by removing part of the spot market supply, was at least a contributing factor in stabilizing the spot market and thereby causing an increase of prices, so that jobbers and consumers in the midwestern area paid more for their gasoline than they would have paid but for the conspiracy, their prices being geared to spot market prices.

Held:

(1) It is immaterial to the question of guilt that other factors also may have contributed to the rise and stability of the markets and that competition on the spot markets was not entirely eliminated. P. 219.

(2) The elimination of so-called competitive evils is no legal justification for such buying programs. So far as price-fixing agreements are concerned the Act establishes one uniform rule applicable to all industries alike. P. 220.

(3) Even though the members of the price-fixing group were in no position to control the market, yet to the extent that they raised, lowered, fixed, pegged, or stabilized prices they would be directly interfering with the free play of market forces. P. 221.

(4) There was no error in the refusal to charge that, in order to convict, the jury must find that the resultant prices were raised and maintained at "high, arbitrary and non-competitive levels." A charge in the indictment to that effect was surplusage. P. 222.

(5) Nor is it important that the prices paid by the combination were not fixed in the sense of being uniform and inflexible. P. 222.

(6) A combination formed for the purpose and with the effect of raising, depressing, fixing, pegging, or stabilizing the price of a commodity in interstate or foreign commerce is illegal per se under the Act. P. 223.

(7) Where the means for price-fixing are purchases of a part of the supply of the commodity for the purpose of keeping it from having a depressive effect on the market, power to fix prices may be found to exist though the combination does not control a substantial part of the commodity. P. 224.

(8) Price-fixing agreements may have effective influence over the market, and utility to members of the conspiracy group, though the power possessed or exerted by the combination falls far short of domination and control. The Sherman Act is not concerned solely with monopoly power. P. 224.

(9) Proof that a combination was formed for the purpose of fixing prices, and that it caused them to be fixed or contributed to that result, is proof of the completion of a price-fixing conspiracy under 1 of the Act. P. 224.

(10) A conspiracy to fix prices violates 1 of the Act though no overt act is shown, though it is not established that the conspirators had the means available for accomplishment of their objective, and though the conspiracy embraced but a part of the interstate or foreign commerce in the commodity. P. 225n.

(11) Under the National Industrial Recovery Act, 48 Stat. 195, a price-fixing agreement could be exempted from the provisions of the Sherman Act only through the code machinery with the approval of the President as provided in 3 (a) and 5; mere knowledge, acquiescence or tacit approval by government employees would not suffice. Pp. 225-227.

(12) A practice contrary to the Sherman Act, even if approved under the National Industrial Recovery Act, became unlawful when continued after the expiration of the Recovery Act. P. 227.

(13) The fact that the buying program in this case may have been consistent with the general objectives of the National Industrial Recovery Act is irrelevant to its legality under the Sherman Act, where the method provided by Congress for alleviating the penalties of the Sherman Act was not followed. P. 227.

(14) Offers of proof by defendants to show that by their buying program they had not raised spot market prices of gasoline to an artificial, non- competitive level, held properly denied as immaterial. P. 229.

(15) Offers of proof by defendants to establish and evaluate other contributing causes for price rise and market stability during the indictment period, held properly denied, as cumulative and collateral. A trial court has a wide range of discretion in the exclusion of such evidence. P. 229.

3. In a trial under the Sherman Act, where much evidence had been given of general economic conditions before and during the indictment period, the defense offered further evidence of market conditions antedating that period, introduction of which would have complicated the case, confused the jury possibly, and protracted an already lengthy trial, held that refusal of the offers was not ground for a new trial, matters of substance not being affected. P. 229.

4. Use of grand jury testimony for the purpose of refreshing the recollection of a witness rests in the sound discretion of the trial judge and no iron-clad rule requires that opposing counsel be shown the grand jury transcript where it is not shown the witness and where some appropriate procedure is adopted to prevent its improper use. Pp. 231, 233.

5. Grand jury testimony is ordinarily confidential. But after the grand jury's functions are ended, disclosure is wholly proper where the ends of justice require it. Pp. 233-234.

6. Permission to use grand jury testimony to refresh the memories of witnesses in a criminal case is not ground for a new trial, even if erroneous, where it was clearly not prejudicial and did not affect substantial rights of the defendant. Jud. Code, 269. P. 235.

7. In the absence of exceptional circumstances, improper remarks made by a prosecuting attorney in his argument to the jury in a criminal trial, are not ground for a new trial if they were not objected to at the time. Pp. 237, 238-239.

8. It is not improper in a Sherman Act case to discuss corporate power, its use and abuse, relevantly to the issues; for the subject is material to the philosophy of that Act, and its purposes and objectives are clearly legitimate subjects for discussion before the jury. P. 239.

9. Appeals to class prejudice in argument to a jury are highly improper and can not be condoned and trial courts should ever be alert to prevent them. P. 239.

10. Although some of the remarks made to the jury by government counsel in argument of this case appealed to class prejudice, were undignified and intemperate, and did not comport with the standards of propriety expected of a prosecutor, they are, in the particular circumstances, not regarded as prejudicial but as minor aberrations in a prolonged trial of a strong case which could not have influenced the minds of jurors. P. 239.

11. Statements made in argument to the jury by government counsel in a prosecution under the Sherman Act to the effect that it was the wish and desire of the highest officials in the Government to have the defendants convicted, held not ground for a new trial, because the defendants had sought to justify their activities as done with government approval and because the statements were but casual episodes in a long summation and not at all reflective of the quality of the argument as a whole. Pp. 241-242.

12. Assertions of personal knowledge, made in argument to the jury by government counsel, held not prejudicial, where they related to a matter irrelevant to the case and, upon objection, were withdrawn and the jury instructed to disregard them. P. 242.

13. The granting of a new trial to some of the defendants convicted of a conspiracy does not require that a new trial be granted to the others, where participation by the former was not necessary to the existence of the crime charged and the jury was instructed that it could convict any of the defendants found to have been members of the combination and that it need not convict all or none. Pp. 243, 246.

14. In a Sherman Act case, as in other conspiracy cases, the grant of a new trial to some defendants and its denial to others is not per se reversible error. After the jury's verdict has been set aside as respects some of the alleged co-conspirators, those remaining can not seize on that action as ground for the granting of a new trial to them, unless they can establish that such action was so clearly prejudicial to them that the denial of their motions constituted a plain abuse of discretion. P. 247.

15. As a general rule, neither this Court nor the Circuit Court of Appeals will review the action of a federal trial court in granting or denying a motion for a new trial for error of fact, since such action is a matter within the discretion of the trial court. P. 247.

16. A denial of a motion for a new trial on the ground that the verdict was against the weight of the evidence is not subject to review. P. 248.

17. Where an indictment charges various means by which a conspiracy is to be effectuated, not all of them need be proved. P. 249.

18. Where a price-fixing conspiracy, violating the Sherman Act, embraced, at least by clear implication, the making of sales at advanced prices to jobbers and consumers in a wide area, held that prosecution would lie in a judicial district within that area and within which such sales were made by any of the conspirators, though the conspiracy was formed elsewhere. P. 250.

19. Conspiracies under the Act are not dependent on the doing of any act other than the act of conspiring, as a condition of liability. P. 252.

105 F.2d 809, reversed.

Mr. Justice Douglas delivered the opinion of the Court.

The Chief Justice and Mr. Justice Murphy did not participate in the consideration or decision of this case.

Mr. Justice Roberts, dissenting, with whom Mr. Justice McReynolds concurs.


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