State v. Mobil Oil Corp.

Capozzoli, J. This action was commenced on July 17, 1972 by the Attorney-General of the State of New York, pursuant to article 22 of the General Business Law (Donnelly Anti-Trust Act), to enjoin and prevent alleged violations of section 340 of that act. [370] Prior to the commencement of this action the Attorney-General had been investigating the practices and policies of the gasoline industry under the cited act. In the course of this investigation the Attorney-General, in February, 1972, served upon defendant a subpoena, pursuant to section 343 of the General Business Law, calling for the production of data concerning defendant’s sales of tires, batteries and accessories. Defendant complied therewith and produced the available information. On July 19, 1972, two days after the institution of this action, and as part of the continuing investigation, the Attorney-General served a second subpoena on defendant to obtain data and documents relative to defendant’s practices concerning dealer aid. More particularly, it sought information concerning the quantum of dealer aid given by the defendant to each service station in the Greater New York area covering the period from May, 1971 to the date of the subpoena. Defendant moved to quash the latter on the ground that it was issued subsequent to the commencement of the civil action against it. It contended that the subpoena was being utilized to circumvent the disclosure procedures provided for in the CPLB and that enforcement of that subpoena would deprive it of its constitutional rights. The Attorney-General has taken the position that the information sought by means of the subpoena in question is relevant to a continuing investigation by him into" the practices, policies and price structures of the gasoline industry. The constitutional attack levied by defendant on this appeal is without merit. (Matter of Hoyt v. Attorney-General, 258 N. Y. 569.) In the cited case the Court of Appeals affirmed, without opinion, an order denying a motion to quash an investigatory subpoena issued pursuant to section 352 of the General Business Law and rejected the contention raised that the section would be unconstitutional if it were construed to permit an examination of one of the defendants in the action, in circumvention of the provisions of the Civil Practice Act. The Legislature has expressly provided, in section 343 of the General Business Law that the Attorney-General may conduct his investigations with authority to issue subpoenas which “ shall not abate or terminate by reason of any action or proceeding brought by the attorney general under this article”. The courts have, on a number of occasions, sustained the authority of the Attorney-General to continue his investigation following the commencement of an antitrust action. (People v. Anaconda Wire & Cable Co., 19 A D 2d 867; Long Is. Moving & Stor. [371] Assn. v. Lefkowitz, 24 A D 2d 452, mot. for lv. to app. den. 17 N Y 2d 419, app. dsmd. 17 N Y 2d 918.) The dissent relies on the ease of People v. Anaconda Wire Co. (45 Misc 2d 151, affd. 23 A D 2d 823, app. dsmd. 16 N Y 2d 871 [1965]). However, the reason for the decision in that case, as given by Special Term in its opinion, was the failure of the Attorney-General to specifically allege that the investigation was still in progress. In fact, Special Term referred to the earlier Anaconda case (19 A D 2d 867, supra) and distinguished it from the case before it, calling attention, at page 152 of its decision, to the fact that, in the earlier Anaconda case, the Attorney-General “ averred that ‘ The investigation is still in progress ’ ”, and the court then went on to say “ there is no such statement in the opposing affidavit submitted herein ”. In the case at bar it clearly appears from the two affidavits of Charles A. La Torella, Jr., Assistant Attorney-General in charge, that the investigation is very much alive and is continuing. The order denying defendant’s motion to quash the subpoena issued by the Attorney-General should be affirmed, without costs.