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Baker v. United States Steel Corp.

decided: February 25, 1974.


Appeals from an order of the District Court for the Southern District of New York, Inzer B. Wyatt, Judge, transmitting grand jury minutes to the District of Connecticut at its request, and from an order of the District of Connecticut, Jon O. Newman, Judge, granting disclosure of redacted portions of the minutes to plaintiffs for general discovery purposes and denying a stay of disclosure pending appeal. Dismissed.

Kaufman, Chief Judge, Lumbard and Mansfield, Circuit Judges. Lumbard, Circuit Judge (dissenting).

Author: Mansfield

MANSFIELD, Circuit Judge:

Appellants, who are the defendants in a rather hoary private civil antitrust action pending before Judge Newman in the District of Connecticut, seek review of an order entered by Judge Wyatt in the Southern District of New York transmitting to the Connecticut district court, at Judge Newman's request, transcripts of testimony given years earlier before a grand jury in the New York district which had filed an indictment against the defendants based on the same charges later asserted in the civil suit. Appellant United States Steel Corporation, alone, has also appealed from an order by Judge Newman, dated November 2, 1973, denying a stay of the release to plaintiffs of redacted portions of the transcripts, which appeal was consolidated with the pending appeal from Judge Wyatt's order by an order of this Court dated November 9, 1973. Since we find these interlocutory orders to be non-appealable, we must dismiss these appeals.

On April 2, 1963, a grand jury sitting in the Southern District of New York filed an indictment against five manufacturers of steel railroad wheels charging a conspiracy in violation of § 1 of the Sherman Act, 15 U.S.C. § 1, to fix the price of railroad wheels at artificially high levels. The criminal case was terminated upon the court's acceptance of nolo contendere pleas by the defendants. Approximately four years later the Trustees of the New Haven Railroad, to whose interest the Trustees of the Penn Central succeeded as plaintiffs, commenced a civil antitrust suit in the District of Connecticut which, tracking the allegations of the indictment, sought treble damages against the same five defendants*fn1 for alleged overcharges for railroad wheels during the period from 1948 to 1967.

After the civil action, still in the discovery stage, had languished for another five years or so plaintiffs sought transcripts of testimony given by seven witnesses before the New York district's grand jury, who at the time of testifying were officials of the defendants but are now deceased. Plaintiffs were unable to satisfy the test of showing a "particularized need for the testimony," see Pittsburgh Plate Glass Co. v. United States, 360 U.S. 395, 3 L. Ed. 2d 1323, 79 S. Ct. 1237 (1959); United States v. Procter & Gamble Co., 356 U.S. 677, 2 L. Ed. 2d 1077, 78 S. Ct. 983 (1958); In re Biaggi, 478 F.2d 489, 491 (2d Cir. 1973), their object being to use the transcripts as "leads" to evidence that might support their claims. However, they succeeded in persuading Judge Newman that the particularized need test should not be applied in this case since some of the considerations which underlay it no longer existed.*fn2 As a result he ruled that "only a slight need for disclosure will be sufficient" and that the public interest against unwarranted disclosure could be protected by his examining the transcripts in camera and redacting those portions not relevant to the civil suit, including names and comments of grand jurors as well as parties and activities not charged in the criminal and civil proceedings.

Lacking custody or control over the New York district's grand jury minutes, Judge Newman adopted a procedure suggested by the District of Columbia Court of Appeals in Gibson v. United States, 131 U.S. App. D.C. 143, 403 F.2d 166 (D.C. Cir. 1968). As part of his decision he certified to the Southern District of New York that the grand jury testimony sought by plaintiffs should be reviewed by him in camera for disclosure in the Connecticut proceeding and requested the New York district court to forward the transcripts to him for that purpose. Counsel for the defendants then asked the Southern District of New York for a hearing on the request, which was held by Judge Wyatt on June 27, 1973. For that purpose a civil miscellaneous proceeding entitled "In the Matter of the Grand Jury Proceedings from the United States District Court, District of Connecticut; Re: George P. Baker, et al. v. United States Steel Corp., et al., Civil M 11-188" was established. Upon hearing the parties Judge Wyatt indicated that he did not propose to sit in review of Judge Newman's decision and that for "reasons of judicial administration" he was inclined to grant Judge Newman's request. On the following day Judge Wyatt filed a short memorandum decision granting the request.

Defendants immediately appealed from Judge Wyatt's order to this court and on July 30, 1973, we denied their motion for a stay of that order. We also denied plaintiffs' motion to dismiss the appeal without prejudice to its being reargued upon argument of the appeal. The transcripts of some 951 pages of grand jury testimony were then forwarded to Judge Newman who, after reviewing them in camera, sealed all or portions of 378 pages as involving parties or activities different from those alleged here, and held the balance of 573 pages for release to the plaintiffs. In an opinion filed November 2, 1973, Judge Newman denied defendants' motion for a stay of the release of the minutes but in order to preserve the status quo so that a ruling could be obtained from this court he delayed release of the transcripts until November 12, 1973. On November 6, 1973, United States Steel Corporation filed a notice of appeal from Judge Newman's November 2 ruling. On November 12, 1973, we directed that both appeals be heard together and stayed release of the transcripts pending our decision of the appeals.


At the outset we face the question of whether either of the two orders, both of which deal with pretrial discovery, is appealable. Normally

"orders dealing with discovery have been held interlocutory and therefore unappealable, when issued in the same jurisdiction as that of the main proceeding, e.g., Horvath v. Letay, 343 F.2d 463 (2 Cir. 1965); Cimijotti v. Paulsen, 323 F.2d 716 (8 Cir. 1963); Hoffa v. United States, 309 F.2d 680 (5 Cir.), cert. denied, 371 U.S. 878, 83 S. Ct. 147, 9 L. Ed. 2d 115 (1962), or when, though issued in outside jurisdictions, they compelled disclosures, see, for example, Cobbledick v. United States, 309 U.S. 323, 60 S. Ct. 540, 84 L. Ed. 783 (1940); National Nut Co. of California v. Kelling Nut Co., 134 F.2d 532 (7 Cir. 1943); Korman v. Shull, 310 F.2d 373 (6 Cir. 1962); but also see Covey Oil Co. v. Continental Oil Co., 340 F.2d 993 (10 Cir), cert. denied, 380 U.S. 964, 85 S. Ct. 1110, 14 L. Ed. 2d 155 (1965)." Republic Gear Co. v. Borg-Warner Corp., 381 F.2d 551, 554 (2d Cir. 1967).

Our strong policy against interlocutory appeals is based principally on the view that since review is ultimately available upon appeal from the final judgment in the action, unnecessary intermediate appeals only serve to delay trial and to provide an opportunity for harassment and abuse, burdening us with procedural issues at a time when our dockets are swamped. See American Express Warehousing, Ltd. v. Transamerica Insurance Co., 380 F.2d 277, 280 (2d Cir. 1967); United States v. Fried, 386 F.2d 691 (2d Cir. 1967). Indeed, appeal from Judge Newman's order appears to be foreclosed by our decision in Atlantic City Electric Co. v. A. B. Chance Co., 313 F.2d 431 (2d Cir. 1963), where we applied the foregoing principles to deny both a petition for a writ of mandamus and for leave to appeal under 28 U.S.C. § 1292(b) from an order granting disclosure of grand jury minutes for use in a civil antitrust case, absent a showing that "there has been a manifest abuse of discretion." 313 F.2d at 434.*fn3

Appellants virtually concede that, if their sole appeal were from Judge Newman's order, dismissal would be mandated. However, relying principally upon In re Biaggi, 478 F.2d 489 (2d Cir. 1973); Gibson v. United States, 131 U.S. App. D.C. 143, 403 F.2d 166 (1968); and United States v. Byoir, 147 F.2d 336 (5th Cir. 1945), they contend that since Judge Wyatt's order represented a complete disposition of the only proceeding pending in the Southern District of New York it is final and appealable, and that since Judge Newman's November 2d decision hinged upon Judge Wyatt's order the two are inextricably intertwined and must be considered together.

Although we agree that both orders are "of a piece" we fail to perceive how this helps appellants or renders the orders any more final or appealable than if both had been entered in the same district court. Passing over the argument that, Judge Wyatt's order having been carried out, an appeal from it may at this stage be moot,*fn4 nothing about that order precludes an ultimate review of the basic underlying issue of whether discovery may be had of the grand jury testimony for use in this civil case. We are not here dealing with an order of a different district court denying access to the transcripts, which conceivably could be directly or separately reviewable as a final order because it could not be reviewed in the case pending in the Connecticut district, see, e.g., Gibson v. United States, supra ; Republic Gear Co. v. Borg-Warner Corp., supra, but with an order which, no matter how it was labelled, was in effect ancillary to the main proceeding in the Connecticut district. See, e.g., National Nut Co. of California v. Kelling Nut Company, 134 F.2d 532 (7th Cir. 1943) (discovery order of Northern District of Illinois issued pursuant to order granted in main proceeding in ...

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