was never carried into effect, as it otherwise and normally would have been, and, at least by it, there was no subversion of the Grand Jury.
The Court feels it should allude to a certain temporary angle of this Grand Jury proceeding, even though the Department of Justice does not allude thereto in its briefs filed on this motion. We must bear in mind that household soaps and industrial soaps differ substantially in both their production and their distribution, and the civil complaint herein refers to household soap and detergents only. The record shows that on February 1, 1952, before any oral testimony had been taken, there was an allusion in a Department of Justice memorandum to 'the civil soap case and criminal case in industrial soaps and glycerine.' This consideration of the criminal aspect of a matter, quite different from the civil complaint in this case, had but the shortest life. But a month and a half later, on March 19, 1952, the industrial soap matter was alluded to by the Department of Justice as 'general litigation,' as to which a civil 'complaint' was to be submitted, in the same fashion as the civil complaint which is the basis of the present proceeding as to household soap. There is nothing whatever to indicate that any such criminal aspect of the industrial soap litigation was sought by the Department previously and when the Grand Jury was impanelled. It arose only after the Government had obtained a large number of the defendants' documents but before a single witness had testified. Finally, this industrial soap angle was dropped, criminally at least, almost immediately.
Obviously this angle had nothing to do with the impanelling of the Grand Jury. Obviously it only affected the use of the Grand Jury for the month and a half it was being temporarily considered. When dropped it obviously did not affect the use of the Grand Jury thereafter, i.e., from the very beginning of the oral testimony. Presumably plaintiff's briefs do not allude thereto because the situation, weak as it is, could not possibly have any practical, but only an academic, effect. That is because this temporary consideration of this different criminal aspect could only affect the documents upon which it was based, not the oral testimony which had not then been taken, and these documents are presumably all defendants' documents, as to which all parties are fully advised.
To bolster up their contention that the Department of Justice always intended a criminal outcome of the Grand Jury investigation of the household soap industry, and in entire disregard of the documents to the contrary written by Smith, Kramer and Morison before the Grand Jury was impanelled, plaintiff alludes to the recent oral testimony of Kramer that he and Smith agreed to make no 'decision' or 'conclusion' not to proceed criminally, until after the great bulk of the witnesses before the Grand Jury had been heard orally. But it is quite clear that this 'decision' and 'conclusion' referred to a final decision and conclusion, made after the ever present, but unexpected, legal possibility of an indictment had failed to eventuate in fact. Nor does the above show that either Smith or Kramer ever intended, expected or desired that any such indictment would result. In fact their written statements at the time are to the contrary, and, as stated above, it is the Government's intent and desire which is the determining factor. To the same effect is plaintiff's reliance upon the depositions of Morison and Clapp. Their evidence in no way shows that they had an 'expectation,' to use the plaintiff's term, of a criminal indictment, nor that an indictment was ever 'sought.' Neither witness testified that the Department was seeking an indictment.
Finally, plaintiff is simply incorrect when it says:
'The determination that the prior criminal case had proved ineffective was based upon the facts developed during the course of the Grand Jury's investigation.'
The exact contrary is shown to be the fact by the above mentioned memorandum from Smith to Kramer of March 21, 1951, by the memorandum of Kramer to Morison of March 23, 1951, both of them before the impanelling of the Grand Jury was even authorized, and by the memorandum of Morison to Attorney General McGrath of March 23, 1951, taken in connection with that of Clapp to Attorney General McGranery of November 13, 1952, the latter having been written almost completed. In them Smith, almost completed. In them Smith, Kramer and Morison, before the impanelling of the Grand Jury, alluded to the same basis for not considering a criminal remedy effective, as did Clapp in his memorandum to Attorney General McGranery, toward the very end of the Grand Jury sessions. Smith and Kramer, from past experience, stated that they considered a criminal remedy inadequate; they considered 'divestiture * * * the only effective relief' against this monopoly. So Morison, on receipt of these recommendations, immediately asked for a Grand Jury to investigate this 'monopoly.' After almost all the Grand Jury witnesses had been heard, Clapp wrote Attorney General McGranery as to this 'monopolization.' To remedy this, he advised 'only * * * divestitures or dissolutions.' The Department's viewpoint that a criminal remedy would be ineffective was the same, both before the Grand Jury had been impanelled and after its sessions had substantially come to an end. Plaintiff's above claim is therefore clearly incorrect.
In conclusion, it thus appears that the situation in regard to the present defendants, as known to the Department of Justice when it called and used the Grand Jury in this case, was not a 'case with a criminal cast.' It was not one where the criminal 'trails' looked 'fresh at the start.' On the contrary, as those in actual charge of the Grand Jury recommended at the time, mere 'injunctions or criminal prosecutions as remedies' were inadequate, and equitable 'divestiture or dissolution is both necessary and practicable.' Again, as Kramer said:
'* * * we propose to use a Grand Jury for the purpose of gaining evidence. If evidence of a law violation is obtained, we propose to file a civil suit * * * the use of a Grand Jury to obtain evidence of a violation of law under these circumstances is entirely appropriate * * *'
Further, the Grand Jury was impanelled for the express purpose of endeavoring to obtain evidence to justify the 'divestiture or dissolution' of an apparent 'monopoly.' As to such monopolies, it was then the policy of the Department of Justice to proceed against them not criminally, but civilly.
Obviously the prosecution was thus 'using criminal procedures to elicit evidence in a civil case,' to quote from the Supreme Court in its above decision in this case. Hence the United States was, to quote from the same decision, 'flouting the policy of the law' and 'criminal procedure is subverted.' To continue the use of the language of our highest Court, and to apply here the very remedy laid down by our highest Court as appropriate in the present circumstances, the 'production of a (the) Grand Jury transcript' (brackets this Court's) to the defendants is 'warranted.'
One of the defendants again urges that because of the above 'subversion' of criminal procedure all the Grand Jury testimony, together with all leads obtained by the Government therefrom, be impounded and suppressed. This would, of course, terminate the Government's entire case. It would completely frustrate the intent of the Congress in enacting the Sherman Act. Indeed, this very claim by this very defendant has already been ruled on adversely by this Court, 180 F.Supp. 195 (1959). To repeat the grounds of that decision would obviously be unnecessary and inappropriate. In any event, it is apparent that the defendant's request for impounding was one which our highest Court clearly had in mind when it decided that the appropriate remedy under such circumstances of misuse was to turn over the Grand Jury testimony to the defendants for their use.
Our highest Court doubtless then had in mind the fact that the Department of Justice thought at that time that it was legally justified in taking the action it did. But if the Department were to repeat such action now, in the fact of the above decision of out highest Court that same was illegal, it might well be that a different and more stringent remedy would be considered appropriate.
An order to turn over the Grand Jury transcript to the defendants may be presented accordingly.