The opinion of the court was delivered by: STEWART
Plaintiffs, shippers in the United States/Europe ocean shipping trade, brought these actions under section 4 of the Clayton Act, 15 U.S.C. § 15 seeking damages for injuries sustained as a result of violations by defendants of section 1 of the Sherman Act, 15 U.S.C. § 1.
They seek relief on behalf of themselves and all United States shippers by common carrier in the United States/Europe trade during the period 1971 through a certain time in 1977. Defendants are common carriers engaged in ocean transportation of freight for hire, serving the United States/Europe trade. As such, they are subject to regulation by the Federal Maritime Commission ("FMC" or "Commission") under the Shipping Act of 1916, as amended, 46 U.S.C. § 801 et seq., 1976.
Plaintiffs allege that, beginning in 1971 and continuing until sometime in 1977, defendants participated in a conspiracy consisting of a continuing agreement to fix, raise, maintain and stabilize price levels for the shipment of freight in the United States/Europe trade. Plaintiffs further allege that the agreement was not approved by the Commission and was not authorized or permitted by existing agreements that had been approved by the FMC.
Under the Shipping Act, any agreement among carriers engaged in ocean transportation of freight fixing rates or fares or in any manner providing for an exclusive, preferential or cooperative working arrangement must be filed with the FMC, 46 U.S.C. § 814. The Commission is required to disapprove agreements that are:
unjustly discriminatory or unfair as between carriers, shippers, ... or operate to the detriment of the commerce of the United States, or (are) ... contrary to the public interest, or ... (are) in violation of the (act).
It is required to approve all other agreements subject to its jurisdiction. 46 U.S.C. § 814. An agreement approved by the Commission is excepted from the antitrust laws. Before approval or after disapproval, however, the agreement is subject to antitrust laws. Id.
Defendants have moved to dismiss the complaints or, in the alternative, to stay the action pending an investigation and determination by the Commission, pursuant to the doctrine of primary jurisdiction. The Commission has moved to intervene and for a stay of this proceeding.
The facts and circumstances leading to these motions, as set forth in the parties' pleadings, are as follows: As of 1972, the FMC had approved seven conference agreements, three rate agreements, and a number of cooperative working agreements, of which each of the defendant lines were a member for some relevant period.
In 1969 defendant lines filed with the FMC the "Transatlantic Freight Conference," FMC Agreement 9813. The proposed "super-conference" allegedly would have established one conference with authority to fix rates, charges and practices for the United States/Europe trade. In 1971, the parties withdrew the proposed agreement. In 1977, eight conferences covering the United States/Europe trade, of which defendants were members, filed a proposed agreement, called the Bridge Agreement, to take joint interconference action on such matters as rates and charges for transportation of cargo, costs of providing transportation of cargo, and collection, preparation and dissemination of data or reports. The Bridge Agreement was disapproved by the FMC in March of 1978. The carriers appealed the FMC's order of disapproval on procedural grounds. The FMC determined, based on a recent Court of Appeals decision, that their procedures would not be found to meet due process requirements set forth in U.S. Lines v. FMC, 189 U.S. App. D.C. 361, 584 F.2d 519 (D.C.Cir.1978). The FMC them moved to remand the case for further proceedings, and the Court of Appeals granted this motion. The carriers then withdrew their proposed agreement, and pursuant to court order, the FMC vacated the proceedings and dismissed the case as moot.
On June 1, 1979, a federal grand jury in the District of Columbia returned indictments against the defendants charging that they entered into several agreements and understandings not approved by the FMC during the years 1971 through 1975 "to fix, raise, stabilize and maintain price levels for the shipment of freight in the United States/Europe trade." D.C.Crim. No. 79-00271, §§ 33, 34. The defendants pleaded nolo contendere to the indictments on June 8, 1979, and large fines were assessed.
Following the judgment in the criminal actions, the instant civil actions were filed and consolidated before us for pretrial proceedings.
On August 14, 1979, the FMC served an Order of Investigation naming the seven defendants and their conferences as "respondents" and directing that a hearing be held to investigate the charges contained in the indictment. Investigation of Unfiled Agreements in the North Atlantic Trades, FMC Docket 7983.
The FMC, by its General Counsel's Office, moves to intervene in this action, pursuant to Rule 24(a)(2) and Rule 24(b)(2), F.R.Civ.P. Plaintiffs move to strike the Commission's motion to intervene, or in the alternative, to deny intervention. The Office of the Attorney General, not a party to this action, has submitted a letter to the Court asserting that the Commission is without authority to move independently to intervene without the authorization or consent of the Department of Justice, that no such authorization or consent was granted, and that the Court should therefore strike the pleadings of the Commission.
Plaintiffs and the Attorney General rely on 28 U.S.C. §§ 516 and 519 as the basis for their motions to strike. Section 516 of Title 28 provides:
Except as otherwise authorized by law, the conduct of litigation in which the United States, an agency, or officer thereof is a party, or is interested, and securing evidence therefor, is reserved to officers of the ...