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City of New York v. International Pipe and Ceramics Corp.

decided: April 10, 1969.


Moore and Hays, Circuit Judges, Timbers,*fn* District Judge. Hays, Circuit Judge (dissenting).

Author: Moore

MOORE, Circuit Judge:

The plaintiff "THE CITY OF NEW YORK, a Municipal Corporation of the State of New York, on behalf of itself and all others similarly situated" brings this action as the representative of a class (Rule 23, F.R. Civ. Pr.) consisting of "all state and municipal governments, government agencies, authorities and subdivisions in the United States . . ."*fn** The defendants are manufacturers and sellers of "low-pressure" and "non-pressure" concrete pipe, allegedly sold to governmental agencies pursuant to a conspiracy in violation of the antitrust laws of the United States. This action is the outgrowth of two indictments in the District of New Jersey in 1966 in which certain of the defendants in this action and others not here named were charged with criminal conspiracy.

The indictments were filed on January 11, 1966, the defendants therein pleaded nolo contendere and sentences were imposed on April 29, 1966. The action by the City of New York was filed on April 28, 1967. These dates are of importance only with reference to the possible application of the statute of limitations if the requirement for the commencement of this action within a year from the termination of the criminal actions controls (Clayton Act, §§ 4B, 5(b), 15 U.S.C. §§ 15 (b), 16(b), 69 Stat. 283). In all, twenty-seven governmental agencies have intervened as plaintiffs.

In January 1968 defendant Martin Marietta Corporation supported by defendant Kerr Concrete Pipe Company moved to obtain a determination that the action should not be treated as a class action as defined in Rule 23. The motion came on before Judge Ryan. The Judge did not dispose of the motion in summary fashion but made a thorough investigation into the facts bearing upon a determination of the class action issue. Towards this end he directed extensive factual discovery by means of interrogatories and answers thereto. The answers included amongst other things information as to the names of the manufacturers, place of manufacture, the names and location of customer purchasers, the periods of purchase and sale, and the cost.

The Proceedings Before Judge Ryan

On December 12, 1967, a hearing was held before Judge Ryan relating largely to the granting of interventions and to the effect of existing interrogatories and answers thereto.

On January 10, 1968, a lengthy hearing was conducted (Tr. pp. 1-97). Further interventions were allowed and various counsel for plaintiff and intervenor-plaintiffs presented their views as to the propriety and practicality of treating the case as a class action. During argument, the Court expressed the opinion that "the Court will be in a much better position to determine whether this is or is not to be declared a class action at this time if we have these interrogatories served and answered before the determination is made to have some basis for it" (Tr. p. 31).

On April 2, 1968, there was an adjourned hearing (Tr. pp. 1-127), on the class action motion and the Court proceeded to hear final argument "since the answers to these interrogatories have been served by the defendants and by a substantial number of the plaintiffs . . ." (Tr. p. 4). The interrogatories and answers were exceedingly voluminous and were filed by the City of New York, International Pipe and Ceramics Corp., Kerr Concrete Pipe Co., the Port of New York Authority, the State of New York and the New York State Thruway Authority, the City of Philadelphia, Allegheny County Sanitary Authority, the City of Detroit, the City of Tampa, the City of Pittsburgh, the State of Alaska and the State of Ohio. Illustrative of the vast quantity of information furnished to the Court are the answers of the State of Ohio for the years 1955-58 which covered 634 pages and the submission by the New York State Thruway Authority of 102 exhibits.

During argument, the Court covered the many factual elements which he felt should control his judgment as to whether this action should be regarded as, and continue as, a class suit.

After having the nature and scope of the prospective trial thus unrolled before him, having had an opportunity to examine the interrogatories and answers thereto over a period of many weeks and after having heard extensive oral argument on the class action issue, Judge Ryan came to the conclusion that "treatment of this suit as a class action would not be 'superior to other available methods for the fair and efficient adjudication of the controversy.'"

Of particular significance is Judge Ryan's role as a Rule 2 judge, namely, as the judge assigned to hear and determine all procedural matters in advance of the trial, to align the relevant issues and to hear and determine the issues on the trial itself. The responsibility therefore of the fairest and most efficient way to handle the trial should be left in the hands of the judge charged therewith. This point is illustrated by Judge Ryan's comment during argument for the issuance of a certificate that he had "simply held that this suit under the facts here, the undisputed facts, does not require and does not dictate that it be given class treatment" and that "it is not just, fair and equitable and that it would not promote the orderly conduct of this litigation" (Tr. 4/23/68, pp. 18, 15).

The key words of Rule 23 are "fair and efficient adjudication." This issue should not be decided in an abstract or academic manner but rather in a practical and realistic way by a trial judge who has knowledge of the actual problems presented in the courtroom by these multi-plaintiff, multi- defendant cases. In theory and in an initial off-hand reaction, it is tempting to say: why not let everyone who asserts a somewhat related grievance come into a common arena to resolve their controversy? However, on a moment's reflection, it should be apparent that the capacities of judges and jurors to absorb the factual situations thus presented are finite and that courthouses are not coliseums. Illustrative of the desirability of focusing attention upon narrow issues is the increasing tendency in the criminal law to avoid as much as possible the multi-defendant trial on the theory that it is most difficult to assure "equal protection" and "due process" if court or jury has to resolve a plethora of issues between a host of parties.

Contrasted against this obvious difficulty are the equally obvious benefits intended to be bestowed by the Rule 23 class action which would obviate the necessity for many -- possibly hundreds of ...

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