N. W. Electric Power Cooperative, Inc. v. General Electric Co.

DUNCAN, Chief Judge. Plaintiff instituted this suit against the defendants for violation of the Antitrust Act. The defendants, Federal Pacific Electric Company and I-T-E Circuit Breaker Company, have filed motions to strike the first sentence of paragraph 13 and all of paragraph 14 of the Complaint, and as to I-T-E Circuit Breaker Company in paragraph 13 the phrase, “following the grand jury proceedings which culminated in the return of an indictment against Defendants”. Said paragraphs are as follows: “13. Plaintiff had no knowledge of the said combination and conspiracy, or of any facts which might have led to the discovery thereof until 1960, and it first became aware of the unlawful conspiracy following the grand jury proceedings which culminated in the return of an indictment against Defendants in February, 1960. Plaintiff could not have uncovered the conspiracy at an earlier date by the exercise of due diligence, inasmuch as the unlawful conspiracy had been fraudulently concealed by Defendants through their adoption of elaborate schemes for submitting sham and collusive bids which misrepresented the independence and competitiveness thereof, and their resort to secrecy to avoid detection, as hereinabove alleged in Paragraph 11 hereof. “14. On February 16, 1960, the United States of America instituted Criminal Action No. 20235 and Civil Action No. 27717 in the United States District Court for the Eastern District of Pennsylvania against all the Defendants named herein. By said indictment and complaint the United States charged that Defendants engaged in an unlawful combination and conspiracy in restraint of interstate trade and commerce in circuit breakers in violation of Section 1 of the Sherman Act, and further charged that said combination and conspiracy consisted of a continuing agreement to fix prices, allocate business and submit collusive bids to governmental agencies and corporations, in connection with the sale of circuit breakers. The United States further charged therein that Defendants, for the purpose of forming and effectuating said combination and conspiracy, have done, among other things, those acts alleged herein in paragraph 11. On April 8, 1960, Defendant Allis-Chalmers pleaded guilty to the indictment. On December 8, 1960, Defendants General Electric and West [559] inghouse pleaded guilty, and Defendants Federal Pacific and I-T-E pleaded nolo contendere to the indictment. On February 7, 1961, judgment was entered on those pleas, and penalties were imposed by the Court.” The motions to strike are based on the grounds that said allegations “are immaterial, impertinent and highly prejudicial to” these defendants. The court agrees with said defendants that they are immaterial and prejudicial to these defendants, and said motions are hereby sustained.