Merck & Co., Inc. v. Elmer B. Staats, Comptroller Merck & Co., Inc. v. Elmer B. Staats, Comptroller

665 F.2d 1236, 29 Cont. Cas. Fed. 81,872, 214 U.S. App. D.C. 418, 1981 U.S. App. LEXIS 17891

• Court: Court of Appeals for the D.C. Circuit
• Decided: September 10, 1981
• Docket: 79-1435, 79-1438
• Status: Published

Opinions

PER CURIAM:

The issue in this ease is the scope of the authority of the Comptroller General to examine records of Merck & Company relating to four contracts, negotiated without advertising, for sale of pharmaceutical products to the Department of Defense and the Veterans Administration. The right of the Comptroller to examine records is based on 10 U.S.C. § 2313(b) (1976) and 41 U.S.C. § 254(c) (1976), the latter of which requires that the following language appear in government contracts negotiated without advertising:

[T]he Comptroller General .. . shall ... have access to and the right to examine any directly pertinent books, documents, papers, and records of the contractor ... involving transactions related to [this contract]. . . .

Each of the Merck contracts contained such a provision. Relying upon it the Comptroller General requested access to Merck’s records directly pertinent to the pricing and cost of items furnished under each Merck contract. Merck denied the request and this litigation followed.

The District Court granted the Comptroller General access to “all books, documents, papers, or records directly pertaining to the pricing and cost of producing the items furnished by plaintiff Merck ...” under the contracts. However, the District Court enjoined the Comptroller from demanding access to “books, documents, papers, or records with respect to research and development, marketing and promotion, distribution, and administration ...” except as included in the prior grant. Both Merck and the government appeal.

On September 16,1980 Merck filed a conditional petition for a writ of certiorari before judgment. The petition was denied December 8, 1980, 449 U.S. 1038, 101 S.Ct. 618, 66 L.Ed.2d 501 (1980).

This is one of several related cases in various circuits, challenging demands by the Comptroller General to examine the records of pharmaceutical companies pursuant to the access-to-records statutes, 10 U.S.C. § 2313(b) and 41 U.S.C. § 254(c). See Staats v. Bristol Laboratories Division of Bristol-Myers Co., 428 F.Supp. 1388 (S.D.N. Y.1977), 620 F.2d 17 (2d Cir. 1980), aff’d by evenly divided court, 451 U.S. 400, 101 S.Ct. 2037, 68 L.Ed.2d 343 (1981); SmithKline Corp. v. Staats, 483 F.Supp. 712 (E.D. Pa.1980), appeal pending No. 80-1464 (3d Cir. Mar. 19, 1980), conditional petition for certiorari before judgment denied December 8, 1980, 449 U.S. 1038, 101 S.Ct. 619, 66 L.Ed.2d 502 (1980); Eli Lilly & Co. v. Staats, 574 F.2d 904 (7th Cir. 1978), cert. denied, 439 U.S. 959, 99 S.Ct. 362, 58 L.Ed.2d 351 (1978); United States v. Abbott Laboratories, 597 F.2d 672 (7th Cir. 1979); Cf. Hewlett-Packard Co. v. United States, 385 F.2d 1013 (9th Cir. 1967), cert. denied, 390 U.S. 988, 88 S.Ct. 1184, 19 L.Ed.2d 1292 (1968).

The scope and meaning of the statutory access-to-records provision have been thoroughly considered in the decisions we have cited. Conflicts in those decisions must be resolved by the Supreme Court, not by us, and we believe that nothing would be gained by a replowing of the field. Accordingly, without more, we affirm the judgment of the District Court filed January 24, 1979, pursuant to the District Court’s memorandum opinion filed August 12, 1977.

So ordered.