Shawmut, Inc. v. American Viscose Corp.

11 F.R.D. 562, 1951 U.S. Dist. LEXIS 3504, 1951 Trade Cas. (CCH) 62,844
CourtDistrict Court, S.D. New York
DecidedMay 16, 1951
StatusPublished
Cited by19 cases

This text of 11 F.R.D. 562 (Shawmut, Inc. v. American Viscose Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shawmut, Inc. v. American Viscose Corp., 11 F.R.D. 562, 1951 U.S. Dist. LEXIS 3504, 1951 Trade Cas. (CCH) 62,844 (S.D.N.Y. 1951).

Opinion

S. H. KAUFMAN, District Judge.

Plaintiff in an action now pending in the United States District Court for the District of Massachusetts seeks to have Arthur Malina and Malina Company (hereinafter referred to as Malina) and Saul Gutner and Gutner Brothers Corporation (hereinafter referred to as Gutner), none of whom is a party to the action, adjudged to be in contempt of court for failure to comply with subpoenas duces tecum.

Cross-motions have been made by Malina and Gutner (deponents) to limit the taking of depositions by oral examination and to modify the subpoenas. Plaintiff and deponents seek counsel fees and expenses in connection with these motions.

[564]*564Plaintiff seeks discovery of certain information which, it claims, is necessary to support its action against American Viscose Corporation and Atlantic Rayon Corporation. Defendants are alleged to have violated the Sherman, Clayton, and Robinson-Patman Acts, 15 U.S.C.A. §§ 1 et seq., 12 et seq., 13c, for which plaintiff demands damages and injunctive relief. Ma-lina and Gutner, although not parties to the action, are named as “co-conspirators”.

The complaint in this action alleges, in substance, that from about 1941 to 1949 American, the principal producer of viscose processed yarn, sold such yarn in interstate commerce to plaintiff, defendant Atlantic, and to Malina and Gutner at the same price; that all the buyers engaged in the business of reselling the yarn in its original containers and that, in addition, all but Gutner used large quantities of the yarn in processing activities.

The complaint further alleges that in 1949 American entered into- contracts with these buyers, other than plaintiff, under which it was agreed that the buyers would resell American’s yarn only at American’s list price, and that each particular buyer would receive from American a discount of 5%. It is alleged that American refused to extend a similar discount to plaintiff although, for a time subsequent to the date of these agreements, American sold plaintiff yarn which plaintiff resold unprocessed. Plaintiff alleges that when it complained that the discount arrangements' with its competitors constituted a violation of its rights, American refused to sell it any more yarn; that when plaintiff asked each of its competitors, including Malina and Gutner, for a supply of yarn, they all refused to sell or even to quote prices thereon, although in previous years when a similar arrangement had been in effect 'between Malina, Gutner, American, and Atlantic’s predecessor, Textron, Inc., both Gutner and Textron sold large quantities of yarn to plaintiff.

Two questions are presented for determination: 1. Are deponents in contempt? 2. Should the depositions by oral examination be limited and the subpoenas duces tecum modified?

1. The question of contempt.

The motions for orders adjudging deponents in contempt must be denied. No defiance of the authority of this court has been shown. On • the contrary, deponents have acted with strict conformity to the court’s edict. Their original motions to limit and modify were denied without prejudice to renewal thereof “when made during the taking of such depositions.” Their motions were renewed without delay in accordance with the leave so given. In these circumstances, it would be inequitable to hold deponents in contempt for refusing to comply with the subpoenas before a ruling on the motion so renewed.

2. Whether the depositions by oral examination should be limited and the subpoenas duces tecum should be modified.

Malina in its cross-motion pursuant to Rules 30 and 45, 28 U.S.C.A. asks (a) that the subpoena be modified by striking out paragraph “8”, which refers to its financial statements, and that the remaining paragraphs be limited to records and other documents which will not disclose the names of any of its customers; (b) that the deposition by oral examination be limited so as to exclude disclosure of customers’ names, and disclosure with respect to financial statements; (c) that it he granted $5,000 for legal expenses in connection with this proceeding.

Gutner’s cross-motion is pursuant to Rules 30 and 45. It seeks (a) to modify the subpoena by striking out paragraph “8”; (b) to exclude production of invoices that will disclose the names of customers and individual sales made to them; (c) to limit the deposition by oral examination so as to exclude disclosure of customers’ names; (d) to be awarded $2,500 for legal expenses in connection with this proceeding.

Since plaintiff has waived its right to examine the financial statements and balance sheets of deponents, the only issue to be decided is whether plaintiff should be permitted to examine’ the customer lists containing confidential sales data which are specified in the subpoenas. Before this [565]*565issue is touched upon, it is necessary to determine whether this court has jurisdiction.

Plaintiff contends that an order of the Massachusetts District Court, denying American’s motion to limit and modify so as to 'exclude disclosure of any customer list information which it may have received from deponents, is binding on Malina and Gutner. There is no merit to this contention since deponents are not parties to this action and were not parties to that pro-, ceeding. Parties may be required to furnish broader information than non-party witnesses.

Plaintiff further argues that under the Federal Rules of Civil Procedure exclusive jurisdiction to limit and modify is vested in the Massachusetts court. It claims that the jurisdiction of this court in the present case is solely that given by Rule 45(f), authorizing contempt proceedings in the event that a subpoena is disobeyed: This is much too restrictive an interpretation of the Federal Rules.

This court clearly has the power to limit the oral examination.1 That it has jurisdiction also to modify the subpoena is equally clear. The subpoenas were served pursuant to Rule 45(d), which provides that a subpoena duces tecum used in connection with a deposition is subject to the provisions of Rule 30(b) and also Rule 45(b). Rule 45(b) states that the court “upon motion made promptly and in any •event at or before the time specified in the subpoena for compliance therewith, may (1) quash or modify the subpoena if it ■is unreasonable and oppressive * * There is no limitation in Rule 45(b) as to the court in which relief may be granted. To place a construction upon Rule 45(b) that would require one who is not a party, ^nd who seeks modification of a subpoena served in connection with an action pending in a distant court, to make application before that court, instead of in the court for the district in which the deposition is being taken, would not effectuate the purpose of the Federal Rules which were designed “to secure the just, speedy, and inexpensive determination of every action”.2 It must therefore be concluded that this court has jurisdiction to decide this application.

There would seem to be no question as to the timeliness of the motions to limit under Rule 30(d). That the motions to modify were timely when originally made was conceded by plaintiff, and this is but a renewal thereof, pursuant to leave of court. Plaintiff concedes in its 'brief that the orders denying the motions as having been prematurely made were in error. In any event, they are not binding upon this court.

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Bluebook (online)
11 F.R.D. 562, 1951 U.S. Dist. LEXIS 3504, 1951 Trade Cas. (CCH) 62,844, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shawmut-inc-v-american-viscose-corp-nysd-1951.