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IN RE ELECTRIC WELD STEEL TUBING ANTITRUST LIT.

March 5, 1981

IN RE ELECTRIC WELD STEEL TUBING ANTITRUST LITIGATION.


The opinion of the court was delivered by: Kocoras, District Judge.

MEMORANDUM OPINION

On June 20, 1979, the movant Unarco Industries, Inc. was served with a subpoena duces tecum in connection with a grand jury investigation of alleged antitrust violations in the welded steel tubing industry. The grand jury proceeding was conducted by the Antitrust Division of the Department of Justice under the supervision of the United States District Court for the Eastern District of Pennsylvania. Unarco produced certain documents and presented testimony in response to the grand jury subpoena in August of 1979. In the subsequent criminal indictment alleging a price-fixing conspiracy under Section 1 of the Sherman Act, 15 U.S.C. § 1, United States v. Berger Industries, et al., Criminal No. 79-278 (E.D.Pa.), Unarco was named neither as a defendant nor as an unindicted co-conspirator. Judge John P. Fullam, who presides over the criminal case, denied the criminal defendants' motions for discovery of the documents submitted to the grand jury by Unarco and other non-parties.

Judge Daniel H. Huyett is presiding over this civil antitrust action in the District Court for the Eastern District of Pennsylvania, which arose from the criminal indictment pending before Judge Fullam. In Re Electric Weld Steel Tubing Antitrust Litigation, No. 79-4628 (E.D.Pa.). Unarco is not a party to this suit. On April 14, 1980, the unidentified civil plaintiffs served Unarco and other non-parties with subpoenas duces tecum seeking all documents submitted to the grand jury which returned the criminal indictment in the Berger Industries case. Having considered the briefs and having heard oral argument on the non-parties' motion to quash on October 9, 1980, Judge Huyett held that grand jury secrecy under Rule 6(e), F.R.Cr.P., would be violated by disclosure and granted the motion. In support of its decision, the court invoked the policy for Rule 6(e), as expressed in United States v. Proctor & Gamble, 356 U.S. 677, 681, n. 6, 78 S.Ct. 983, 985, n. 6, 2 L.Ed.2d 1077 (1958), which protects parties who are investigated by a grand jury but are subsequently exonerated. That court denied class certification to the civil plaintiffs on November 6, 1980.

On November 28, 1980, Unarco was served in this District with a subpoena duces tecum, which is at issue here, in connection with the civil antitrust case pending in the District Court for the Eastern District of Pennsylvania. Unarco filed its motion to quash the subpoena with this Court on December 10, 1980, and oral argument was heard on the fully briefed motion on January 22, 1981. Although the parties who served the subpoena were unidentified in both the briefs and the subpoena, their counsel indicated at oral argument that the subpoena was filed on behalf of all the plaintiffs in the civil case pending in the District Court for the Eastern District of Pennsylvania, No. 79-4628, for purposes of trial preparation.

Another non-party to this civil action, Welded Tube Corporation of America, filed a motion to quash a subpoena duces tecum served by the same plaintiffs in the Eastern District of Pennsylvania. Judge Huyett granted the motion in a bench opinion on January 23, 1981. In supporting its decision, the court observed that the civil subpoena essentially reiterated the language of the grand jury subpoena, and that there was no significant difference between them. Moreover, both the civil subpoena and the subpoena that had been quashed by Judge Huyett on October 9, 1980 sought materials submitted to the grand jury. Therefore, the District Court in Pennsylvania, where the grand jury proceeding took place and this civil case is pending, found that the civil subpoena against non-party Welded Tube Corporation implicated the secrecy policy of Rule 6(e) to the same extent as the prior subpoena for grand jury documents.

In addition, Judge Huyett found that confidential or sensitive material could be within the scope of the civil subpoena's broad sweep. In support of its reluctance to enforce such a broad ranging subpoena against a non-party competitor, the court cited United States v. Serta Associates, Inc., 29 F.R.D. 136, 138 (N.D.Ill. 1961). The court also found the civil subpoena to represent an invasion of the non-party's corporate privacy, which the law has not regarded favorably. Premium Service Corp. v. Sperry & Hutchison Co., 511 F.2d 225, 229 (9th Cir. 1975); Hecht v. Pro-Football, Inc., 46 F.R.D. 605 (D.D.C. 1969). It is unknown, however, whether the subpoena issued to Welded Tube is identical to the instant subpoena.

The civil subpoena served upon Unarco virtually duplicates the original grand jury subpoena. Although this civil subpoena is somewhat broader in scope, every Unarco document submitted to and sought by the grand jury is responsive to the instant request.

I. Rule 6(e) Claims

The plaintiffs first argue that Rule 6(e), F.R.Cr.P., does not preclude disclosure of those documents that Unarco presented to the grand jury. They assert that the secrecy policy of Rule 6(e) is not implicated where the documents are intrinsically and independently valuable to the plaintiffs' prosecution of this civil antitrust litigation in the District Court for the Eastern District of Pennsylvania.

In general, requests for grand jury materials should be directed to the court that supervised the grand jury's activities. Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 226, 99 S.Ct. 1667, 1676, 60 L.Ed.2d 156 (1979); State of Illinois v. Sarbaugh, 552 F.2d 768 (7th Cir. 1977). Where, as in this case, the request is made for use in a case pending in the same district where the grand jury convened, the District Court for the Eastern District of Pennsylvania is particularly suited to make the disclosure decision under Rule 6(e). Cf. Douglas Oil Co. v. Petrol Stops Northwest, supra, 441 U.S. at 226, 99 S.Ct. at 1676. When plaintiffs' subpoena seeking the grand jury documents of Unarco and other non-parties was quashed on October 9, 1980, the District Court for the Eastern District of Pennsylvania held that the secrecy policy of Rule 6(e) would be violated by disclosure of the non-parties' grand jury documents.

Plaintiffs' attempt to relitigate the Rule 6(e) issue with respect to Unarco's grand jury documents is foreclosed. The doctrine of issue preclusion is that "any fact, question or matter in issue and directly adjudicated or necessarily involved in a determination of an action before a court of competent jurisdiction in which a judgment or decree is rendered on the merits, is conclusively settled by the judgment therein and cannot be relitigated in any future action between the parties or privies." Palma v. Powers, 295 F. Supp. 924,933 (N.D.Ill. 1969). The same plaintiffs, who served the subpoena upon Unarco seeking grand jury documents, have reiterated their Rule 6(e) claims here. The District Court for the Eastern District of Pennsylvania quashed the civil plaintiffs' subpoena requesting Unarco's grand jury documents on October 9, 1980. That court's decision was made pursuant to Rule 6(e). Although the judgment of the District Court in Pennsylvania might be interlocutory, the need for a final judgment is not as compelling when the question is whether the determination of a single issue actually decided in the first action should be given conclusive effect in a later action between the parties on a different claim. Dunlap v. City of Chicago, 435 F. Supp. 1295, 1299 (N.D.Ill. 1977). Judge Huyett's decision in the Eastern District of Pennsylvania should be given conclusive effect in this Court where, as in this case, the issues were fully briefed, oral argument was presented, the Pennsylvania District Court supported its decision with an opinion, and Unarco's documents are sought here for use in the litigation pending in the District Court of Pennsylvania.

II. Rule 45(b) Claims

Plaintiffs contend that the document requests of the instant subpoena are neither unreasonable nor oppressive under Rule 45(b), F.R.C.P. They assert that a non-party witness cannot object to the production of evidence if ...


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