A grand jury indicted appellee and a corporation of which he was
an officer for engaging in a combination and conspiracy to
eliminate price competition in the sale of milk in the Kansas City
area, in violation of § 1 of the Sherman Act. In a bill of
particulars, the Government charged that appellee had been acting
"solely in his capacity as an officer, director, or agent who
authorized, ordered, or did" some of the acts constituting a
violation. The District Court dismissed the indictment as to
appellee, on the ground that § 1 of the Sherman Act does not apply
to corporate officers acting in a representative capacity.
Held: a corporate officer is subject to prosecution
under § 1 of the Sherman Act whenever he knowingly participates in
effecting an illegal contract, combination or conspiracy -- be he
one who authorizes, orders or helps to perpetrate the crime --
regardless of whether he is acting in a representative capacity.
Pp.
370 U. S.
406-416.
(a) An officer of a corporation acting solely in his
representative capacity is a "person" within the meaning of § 1 of
the Sherman Act, which imposes criminal sanctions upon "every
person" who violates its provisions. Pp.
370 U. S.
407-408.
(b) A different conclusion is not required by § 8, which defines
"person" to include "corporations and associations." Pp.
370 U. S.
408-411.
(c) A different conclusion is not required by § 14 of the
Clayton Act or its legislative history. Pp.
370 U. S.
411-415.
(d) Nothing in the language or legislative history of the 1955
amendment to the Sherman Act, increasing the penalty for violation
thereof from $5,000 to $50,000 without making a corresponding
increase in the $5,000 penalty under the Clayton Act, indicates
that Congress intended to restrict the applicability of the
increased fine to corporations. P.
370 U. S.
415.
196 F.
Supp. 155 reversed.
Page 370 U. S. 406
MR. CHIEF JUSTICE WARREN delivered the opinion of the Court.
A grand jury returned an indictment charging the National Dairy
Products Corporation with engaging
"in a combination and conspiracy to eliminate price competition
in the sale of milk in the Greater Kansas City market in
unreasonable restraint of . . . trade and commerce, in violation of
Section 1"
of the Sherman Act, 15 U.S.C. § 1. Two counts incorporated by
reference the alleged illegal acts of the corporation and named the
appellee as codefendant. In a bill of particulars, the Government
charged that the appellee had "been acting solely in his capacity
as an officer, director, or agent who authorized, ordered, or did
some of the acts" constituting the violation. The appellee moved
for a dismissal on the ground that the indictment, as
particularized by the bill, failed to charge a crime. According to
appellee, the Sherman Act does not apply to corporate officers
acting in a representative capacity; he contends that the statute
exclusively applicable to these officers is § 14 of the Clayton
Act, 15 U.S.C. § 24. Over the Government's opposition, the
dismissal was ordered by the district judge.
196 F.
Supp. 155. An appeal was perfected pursuant to 18 U.S.C. §
3731, and we noted probable jurisdiction. 368 U.S. 945.
Although the Sherman Act has been in existence for over 70
years, and although corporate officers have been indicted under
that Act for almost as long,
see, e.g., United States v.
Greenhut, 50 F. 469 (D.C.D. Mass.1892);
United States v.
Patterson, 55 F. 605 (D.C.D.
Page 370 U. S. 407
Mass.1893), [
Footnote 1]
this question is one of first impression for this Court. The
impetus for raising this issue at such a late date comes from the
fact that, in 1955, the Congress raised the penalty provision in
the Sherman Act from $5,000 to $50,000 without making a
corresponding increase in the $5,000 penalty found in the Clayton
Act.
Section 1 of the Sherman Act imposes criminal sanctions upon
"every person" who violates that provision, 15 U.S.C. § 1.
[
Footnote 2] The Government
contends that a corporate officer is obviously a "person" within
the Act. The appellee, however, distinguishes between a corporate
officer who represents his corporation and one who acts on his own
account. In the latter case, the appellee agrees that the Sherman
Act applies. But, when the officer is acting solely for his
corporation, the appellee contends that he is no longer a "person"
within the Act. The rationale for this distinction is that the
activities of an officer, however illegal and culpable, are
chargeable to the corporation as the principal, but not to the
individual who perpetrates them.
No substantial support for such an artificial interpretation of
a seemingly clear statute is provided by the legislative history.
The most that can be said for the appellee's position is that the
Reagan Bill, an unsuccessful competitor of the Sherman Bill,
specifically included corporate
Page 370 U. S. 408
officers in its penal section while the Sherman Bill had no
penal section at one time. The penal provision of the Reagan Bill
was offered as an amendment to the Sherman Bill, and the Senate
Committee on the Judiciary then redrafted and resubmitted a bill in
the form which became the Sherman Act. 21 Cong.Rec. 2731, 3152.
That Act outlawed certain acts by "persons," and there is nothing
to indicate that the Congress intended to restrict the meaning as
applied to corporate officers.
See Trailmobile Co. v.
Whirls, 331 U. S. 40.
The appellee points to § 8 of the Sherman Act, 15 U.S.C. § 7,
which defines "person" "to include corporations and associations."
He argues that, since corporations are included within the term,
individual corporate officers are thereby excluded. This is a
non sequitur. The mere fact that the term is given a broad
construction does not alter its basic meaning, and no such
inference can be drawn from the express inclusion of corporations
as "persons." The reason for this inclusion is readily
understandable. The doctrine of corporate criminal responsibility
for the acts of the officers was not well established in 1890.
See New York Central & H. R.R. Co. v. United States,
212 U. S. 481.
When a criminal statute proscribed conduct by "persons," corporate
defendants contended that only natural persons were included.
United States v.
Amedy, 11 Wheat. 392. The same issue raised in
other cases was not always resolved by a unanimous Court.
Beaston v. Farmers' Bank of
Delaware, 12 Pet. 102.
Cf. United States v.
Shirey, 359 U. S. 255. The
dissent by Mr. Justice Story in the
Beaston case would be
sufficient reason for a careful draftsman to avoid the whole
problem of a provision such as § 8. Further reason for caution lay
in the language found in cases then recent.
Sinking-Fund
Cases, 99 U. S. 700,
99 U. S.
718-719, and
Canada Southern R. Co. v. Gebhard,
109 U. S. 527,
109 U. S. 542
(dissenting opinion), which distinguished between persons
Page 370 U. S. 409
and corporations when considering the application of the
Fourteenth Amendment's protection to "persons."
See
Philadelphia Fire Assn. v. New York, 119 U.
S. 110,
119 U. S. 120
(dissenting opinion). Therefore, we attribute no significance to
the specific inclusion of corporations in the definition of
"persons" in determining whether a corporate officer is within the
term.
This Court was faced with the same problem in
United States
v. Dotterweich, 320 U. S. 277,
involving the construction of the Federal Food, Drug, and Cosmetic
Act, 21 U.S.C. §§ 301-392. An earlier version of the Act stated
that the acts of a corporate officer would be chargeable both to
him and to the corporation. In a 1938 revision, the statute made
any "person" responsible and specifically included corporations
within that term. 52 Stat. 1040. The Court of Appeals reversed the
conviction of a corporate officer on the ground that only a
corporation was a "person" within the Act. This Court reversed the
Court of Appeals, rejecting substantially the same argument that is
advanced by the appellee in this case. The reason for the rejection
is equally applicable to the case at bar. No intent to exculpate a
corporate officer who violates the law is to be imputed to Congress
without clear compulsion; else the fines established by the Sherman
Act to deter crime become mere license fees for illegitimate
corporate business operations. Following
Dotterweich, we
construe § 1 of the Sherman Act in its common sense meaning to
apply to all officers who have a responsible share in the
proscribed transaction.
Cf. Carolene Products Co. v. United
States, 323 U. S. 18,
323 U. S.
21.
This construction is supported by the decisions of the lower
federal courts which considered the problem of whether corporate
officers were "persons" within the Sherman Act in the interim
before the passage of the Clayton Act. The most significant case is
United States v. MacAndrews & Forbes Co., 149 F. 823
(C.C.S.D.N.Y 1906),
Page 370 U. S. 410
in which the Court, considered the joint indictment of a
corporation and some of its officers for violations of the Sherman
Act. The defendants demurred to the joinder, the corporation
pleading that only the human agents could be held responsible for
the misdemeanor, while the officers pleaded that only the
corporation was responsible. The Court refused to hold as a matter
of law that either proposition was correct, because responsibility
was, in each case, a matter of fact. The Court noted that the
officers may or may not be convicted, depending upon whether they
were personally responsible for the crime. [
Footnote 3]
In
United States v. Winslow, 195 F. 578
(D.C.D.Mass.1912), the same contention by corporate officers was
given short disposition:
"The indictment, however, expressly charges them [the corporate
officers] as actors, and two fundamental principles are thoroughly
settled. One is that neither in the civil nor the criminal law can
an officer protect himself behind a corporation where he is the
actual, present, and efficient actor; and the second is that all
parties active in promoting a misdemeanor, whether agents or not,
are principals."
195 F. at 581.
Page 370 U. S. 411
We have found no case between 1890 and 1914 in which a corporate
officer successfully secured the dismissal of an indictment or the
reversal of a conviction on the ground that he was not a "person"
within the Sherman Act when he acted solely as a representative of
the corporation.
Unless subsequent statutes have repealed or amended this aspect
of the Sherman Act, our inquiry is at an end.
The appellee seeks succor in the subsequent legislative history
accompanying attempts to amend the Sherman Act between 1890 and
1914. He particularly relies upon H.R. 10539, 56th Cong., 1st Sess.
(1900). This bill would have expressly included corporate officers
and agents in the definition of "persons" found in § 8. The report
accompanying that bill stated that the existing law did not subject
agents, officers, and attorneys to penalties. H.R. Rep. No. 1506,
56th Cong., 1st Sess. However, statutes are construed by the courts
with reference to the circumstances existing at the time of the
passage. The interpretation placed upon an existing statute by a
subsequent group of Congressmen who are promoting legislation and
who are unsuccessful has no persuasive significance here.
United States v. Price, 361 U. S. 304,
361 U. S. 313;
United States v. Turley, 352 U. S. 407,
415, n. 14;
Fogarty v. United States, 340 U. S.
8,
340 U. S. 13-14;
Wong Yang Sung v. McGrath, 339 U. S.
33,
339 U. S. 47;
United States v. United Mine Workers, 330 U.
S. 258,
330 U. S.
281-282;
Gemsco, Inc., v. Walling, 324 U.
S. 244,
324 U. S. 265.
Logically, several equally tenable inferences could be drawn from
the failure of the Congress to adopt an amendment in the light of
the interpretation placed upon the existing law by some of its
members, including the inference that the existing legislation
already incorporated the offered change.
In 1914, the Congress passed "An Act To supplement existing laws
against unlawful restraints and monopolies,
Page 370 U. S. 412
and for other purposes," commonly called the Clayton Act.
Section 14 of that Act provided:
"That whenever a corporation shall violate any of the penal
provisions of the antitrust laws, such violation shall be deemed to
be also that of the individual directors, officers, or agents of
such corporation who shall have authorized, ordered, or done any of
the acts constituting in whole or in part such violation, and such
violation shall be deemed a misdemeanor, and upon conviction
therefor of any such director, officer, or agent he shall be
punished by a fine of not exceeding $5,000 or by imprisonment for
not exceeding one year, or by both, in the discretion of the
court."
38 Stat. 736.
The appellee contends that § 14 is an entirely new provision
added by Congress to provide for the criminal responsibility of
corporate officers who act in a representative capacity. The
Government contends that § 14 is merely supplemental, and that
appellee's construction results in an implied repeal of part of § 1
of the Sherman Act. [
Footnote
4]
Appellee asserts that § 14 would not literally apply to the
officer who acted on his own account because, his misconduct would
not be attributed to the corporation. From this premise, he argues
that, since § 14 of the Clayton Act applies only to an officer
acting in a representative capacity, § 1 of the Sherman Act only
applies to an officer acting on his own account.
We do not agree. The reasons for § 14 are sufficiently revealed
by the legislative history. The provision originated
Page 370 U. S. 413
in the House, and, after conferences with the Senate, survived
substantially intact. The reports provide no assistance, but the
debates do. Whether any supplementary legislation was necessary was
the essence of the debates. As Senate Shields, an opponent,
said,
"[§ 14] is merely a reenactment of the Sherman law, sections 1,
2, and 3. In other words, it has always been held that the officers
of corporations violating the law were punishable under these
sections. . . ."
51 Cong.Rec. 14214.
See 51 Cong.Rec. 9079, 9080, 9169,
9201, 9202, 9595, 9610, 14225, 15820, 16143. The proponents of the
bill agreed that the Sherman Act did cover officers whose conduct
constituted the offense (without distinction as to the capacity in
which the officer was acting), but were disappointed in the
sympathy shown to corporate officers by judges, juries, and
prosecutors. Second, the proponents feared that the present Sherman
Act did not cover officers who merely authorized or ordered the
commission of the offense. These ideas were clearly expressed by
Representative Floyd, a House manager:
"The purpose we had was to make it clear that, when a
corporation had been guilty, those officers, agents, and directors
of the corporation that either authorized, ordered, or did the
thing prohibited should be guilty. Under the existing law, and
without that provision of the statute, the person who did the
things would undoubtedly be guilty; but in the enforcement of the
criminal provisions of the Sherman law, experience has demonstrated
that both juries and courts are slow to convict men who have simply
done acts authorized or ordered by some officers of the concern
higher up, and the words 'authorized' and 'ordered' were introduced
to reach the real offenders, the men who caused the things to be
done. . . ."
51 Cong.Rec. 9609.
See 51 Cong.Rec. 9074, 9185, 9676,
9677, 9678, 9679, 16317.
Page 370 U. S. 414
Third, the proponents were fearful that the Sherman Act might
not cover the activities of an officer which made a single "link"
in the "chain" of events constituting the antitrust violation.
Hence, the provision fixing responsibility for an act constituting
"in whole or in part" the violations. 51 Cong.Rec. 9679, 16275,
16317.
We examine this legislative history in order to ascertain the
intent of Congress as to the ultimate purpose of § 14 of the
Clayton Act.
United States v. E. I. du Pont de Nemours &
Co., 353 U. S. 586,
353 U. S.
591-592;
Schwegmann Bros. v. Calvert Distillers
Corp., 341 U. S. 384,
341 U. S.
390-395;
Federal Trade Comm'n v. Morton Salt
Co., 334 U. S. 37,
334 U. S. 43-46,
334 U. S. 49;
Corn Products Refining Co. v. Federal Trade Comm'n,
324 U. S. 726,
324 U. S.
734-737. How members of the 1914 Congress may have
interpreted the 1890 Act is not of weight for the purpose of
construing the Sherman Act.
Federal Housing Administration v.
Darlington, Inc., 358 U. S. 84;
Rainwater v. United States, 356 U.
S. 590;
Koshkonong v. Burton, 104 U.
S. 668;
Ogden v.
Blackledge, 2 Cranch 272,
6 U. S. 277.
See United States v. Stafoff, 260 U.
S. 477;
Penn Mutual Life Ins. Co. v. Lederer,
252 U. S. 523;
Levindale Lead & Zinc Mining Co. v. Coleman,
241 U. S. 432;
Talbot v. Seeman,
1 Cranch 1.
But see Sioux Tribe v. United States,
316 U. S. 317;
Stockdale v. Insurance
Co., 20 Wall. 323,
87 U. S. 331
(separate opinion);
United States v.
Freeman, 3 How. 556.
Cf. United States v. E. I.
du Pont de Nemours & Co., 353 U.
S. 586.
Section 14 was intended to be a reaffirmation of the Sherman
Act's basic penal provisions and a mandate to prosecutors to bring
all responsible persons to justice. In the light of the
congressional purpose revealed on the face of the statute and by
the legislative history, this Court cannot construe § 14 as a
restriction of § 1 of the Sherman Act. Thus, insofar as § 14
relates to the corporate officer who participants in the Sherman
Act violation, whether or not in a representative capacity, no
change was either intended or effected.
Page 370 U. S. 415
The cases subsequent to the Clayton Act reveal an understanding
in accord with our own. The Government continued to seek
indictments of corporate officers under the Sherman Act, not the
Clayton Act, and many convictions were obtained.
See, e.g.,
United States v. Socony-Vacuum Oil Co., 310 U.
S. 150;
United States v. Trenton Potteries Co.,
273 U. S. 392;
American Tobacco Co. v. United States, 147 F.2d 93
(C.A.6th Cir.),
affirmed, 328 U. S. 328 U.S.
781.
The appellee does not call to our attention any case during this
time in which the contention he now makes was successfully urged.
He suggests that the dearth of cases on this point reflects the
belief on the part of corporate officers that, because of the
identical penalties of the Clayton Act, the successful challenge to
a Sherman Act indictment would be an academic victory. We cannot
even attempt to evaluate the motives of individual defendants in
raising or not raising defenses, even if we regarded the matter as
being significant, which we do not.
The Government, on the other hand, relies upon
United States
v. Atlantic Comm'n Co., 45 F. Supp.
187 (D.C.E.D.N.C.);
United States v. General Motors
Corp., 26 F. Supp.
353 (D.C.N.D.Ind.),
affirmed, 121 F.2d 376 (C.A.7th
Cir.); and
United States v. National Malleable & Steel
Castings Co., 6 F.2d 40
(D.C.N.D.Ohio), holding that nothing in § 14 of the Clayton Act
altered the existing liability for prosecution of all officers who
participate in the violation of the Sherman Act. With this, we
agree.
We also agree that there is nothing in the 1955 amendment to the
Sherman Act nor in its legislative history to indicate that the
Congress intended to restrict the applicability of the increased
fine to corporations.
See 69 Stat. 282; S.Rep.No.618, 84th
Cong., 1st Sess.
Page 370 U. S. 416
Based upon the foregoing, we hold that a corporate officer is
subject to prosecution under § 1 of the Sherman Act whenever he
knowingly participates in effecting the illegal contract,
combination, or conspiracy -- be he one who authorizes, orders, or
helps perpetrate the crime -- regardless of whether he is acting in
a representative capacity. It follows that the District Court erred
when it dismissed the indictment against the appellee. The case is
reversed and remanded for proceedings consistent with this
opinion.
Reversed and remanded.
MR. JUSTICE FRANKFURTER took no part in the consideration or
decision of this case.
[
Footnote 1]
In the Government's brief, the Solicitor General cites 40 cases
in which corporate officers were indicted under the Sherman Act
between 1890 and 1914. Brief for Appellant, pp. 69-72.
[
Footnote 2]
"Every contract, combination in the form of trust or otherwise,
or conspiracy, in restraint of trade or commerce among the several
States, or with foreign nations, is declared to be illegal. . . .
Every person who shall make any contract or engage in any
combination or conspiracy declared . . . to be illegal shall be
deemed guilty of a misdemeanor, and, on conviction thereof, shall
be punished by fine not exceeding fifty thousand dollars, or by
imprisonment not exceeding one year, or by both said punishments,
in the discretion of the court."
[
Footnote 3]
"It is not without significance that offenses as serious, in
congressional opinion, as those created by this statute are made
misdemeanors. When the statute declares that certain acts
notoriously to be accomplished under modern business conditions
only through corporate instrumentality shall be misdemanors
[
sic], and further declares that the word 'person' as used
therein shall be deemed to include corporations, such statute seems
to me clearly passed in contemplation of the elementary principle
that, in respect of a misdemeanor, all those who personally aid or
abet in its commission are indictable as principals. . . . I am
compelled to the conclusion that, under this statute, if the
officer or agent of a corporation charged with fault be also
charged with personal participation, direction, or activity
therein, both may be so charged in the same indictment."
149 F. at 832.
[
Footnote 4]
Appellee also argues, "[t]he Government in this case has not
expressly relied on an aider and abettor theory, but . . . it has
sought tacit support from the theory." Brief for Appellee, pp.
62-68. Under the view we take of the case, it is unnecessary to
consider the application of the general aider and abettor statute,
18 U.S.C. § 2.
MR. JUSTICE HARLAN, concurring.
I join in the opinion of THE CHIEF JUSTICE with some additional
observations, believed warranted by the circumstance that the
holding below has since been followed by five District Courts, with
only two others to the contrary. [
Footnote 2/1]
Page 370 U. S. 417
The language of § 1 of the Sherman Act, providing a penalty for
"every person" who engages in a conspiracy or makes a contract in
restraint of trade, of course, presents a serious obstacle to
appellee's contention that he cannot be prosecuted thereunder. I
agree with the Court that § 8, defining "person" to include
corporations and associations, does not imply the exclusion of
natural persons. Moreover, the fiction of corporate entity,
operative to protect officers from contract liability, had never
been applied as a shield against criminal prosecutions when the
Sherman Act was passed. In fact, I think there can have been no
serious doubt, even as early as 1890, that officers could be
punished for crimes committed for their corporations. Until well
into the nineteenth century, the corporation itself could not be
convicted; the individuals who acted in its name of course could
be.
See the anonymous note of Holt, C.J., 12 Mod. 559,
Case 935, 88 Eng.Rep. 1518 (K.B. 1701);
Rex v. Medley, 6
Car. & P. 292, 297, 299, 172 Eng.Rep. 1246, 1249-1250 (K.B.
1834);
State v. Great Works Milling & Mfg. Co., 20 Me.
41, 44 (1841); Ballantine, Corporations (rev. ed. 1946), § 113.
However, it was recognized that corporate officers could be
convicted for "representative" crimes even after the corporation's
immunity was worn away,
Regina v. Great North of England R.
Co., [1846] 9 Q.B. 315, 325-327, 115 Eng.Rep. 1294, 1298;
State v. Morris & E. R. Co., 23 N.J.L. 360, 369 (1852);
State v. Patton, 26 N.C. 16 (1843), in line with the rule
stated in 1 Bishop, Criminal Law (7th ed. 1882), § 892, that an
agent might be punished for crimes committed for his principal.
Cf. 32 U. S. S.
418� States v. Mills,@ 7 Pet. 138,
32 U. S. 142. A
substantial volume of convictions of individuals for corporate
crimes had accumulated by 1890. [
Footnote 2/2] Congress legislated against this
background; it used words sufficiently broad that representative
crimes fell within their ordinary meaning; and the normal inference
would be that Congress intended to punish those responsible for
acts which it declared unlawful.
The legislative history discloses no intention on the part of
Congress to exempt the representative offenses of corporate
officers. The Sherman bill, S. 1, 50th Cong., 1st Sess., was
reported to the Senate with criminal penalties expressly extending
to corporate officers and agents, but Senator Sherman soon omitted
the criminal provisions altogether. 21 Cong.Rec. 1765, 2455.
Senator Reagan then offered a substitute bill which, among other
things, reinstated the criminal provisions, again expressly naming
corporate agents in slightly different language.
Id. at
2456. Appellee relies on statements made by Senator Sherman in the
debate:
"Whether this law should extend to mere clerks, as was proposed
in the third section [as reported by the Committee], is a matter of
grave doubt. . . . To restrain and prevent the illegal tendency of
a corporation is the proper duty of a court of equity. To punish
the criminal intention of an officer is a much
Page 370 U. S. 419
more difficult process, and might be well left to the future. .
. . These corporations do not care about your criminal statutes
aimed at their servants. . . ."
Id. at 2456, 2457, 2569.
However, the issue before the Senate at that time was not
whether to exempt corporate officers from criminal prosecution, but
whether to omit criminal sanctions entirely. The objections raised
-- that the addition of criminal penalties would result in strict
construction in favor of legality and would inflict punishment for
violations of vague and uncertain provisions -- applied as well to
persons acting for their own account, admittedly included within
the Act as passed, as to those acting for corporations. Moreover,
Senator Sherman was promptly overruled by a vote of 34-12, adopting
the Reagan amendment as an amendment to the Sherman bill.
Id. at 2611. A number of additional amendments rendered
the bill quite unwieldy,
see id. at 2655 (Senator
Sherman), and it was submitted to the Committee on the Judiciary
for tailoring,
id. at 2731. The bill was redrafted in
committee to its approximate present form and passed by a 52-1
vote,
id. at 2901, 3145, 3153.
I am not persuaded, as argued by the appellee, that the greater
margin of support for the final bill than for the Reagan bill
indicates that the criminal liability of corporate officers was
narrowed. Opposition to the Reagan bill was based in part on its
specification of unlawful purposes that would render a combination
a trust,
id. at 2469 (Senator Reagan), 2561 (Senator
Teller), which was omitted by the Committee, and in part on the
inclusion of any criminal penalties at all, a feature common to the
Reagan and the final bills which was accepted at the end in a
spirit of compromise, as it was by Senator Sherman himself,
id. at 2604, 2655. No Senator ever suggested, so far as
can be found, that criminal penalties should be provided for
corporations and for self-employed or "
ultra
Page 370 U. S. 420
vires" individuals alone. Thirty-four Senators -- a
majority of the whole body -- voted to include, via the Reagan
bill, sanctions against officers acting for the corporation. The
Committee's reduction of the explicit but cumbersome language of
the Reagan bill to the simple and on its face equally
all-encompassing "every person" appears to have been simply a part
of the general streamlining of the bill that took place in the
Committee, with no intention of changing substance.
These and the further considerations dealt with in the opinion
of THE CHIEF JUSTICE [
Footnote 2/3]
lead to the conclusion that the indictment in this case must be
sustained.
[
Footnote 2/1]
The opinion below is reported at
196 F.
Supp. 155 (W.D.Mo.1961). In accord are
United States v. A.
P. Woodson Co., 198 F.
Supp. 582 (D.D.C.1961),
appeal pending, No. 1019,
O.T.1961;
United States v. Milk Distributors
Assn., 200 F.
Supp. 792 (D.Md.1961);
United States v. American Optical
Co., 1961 Trade Cases, par. 70,156 (E.D.Wis.1961),
reversed sub nom. United States v. Kniss, 370 U.S., 719;
United States v. General Motors Corp., 1962 Trade Cases,
par. 70,203 (S.D.Cal.1962),
reversed sub nom. United States v.
Staley, post, 370 U. S. 719; and
United States v. Engelhard-Hanovia, Inc., 204 F. Supp. 407
(S.D.N.Y.1962),
appeal pending sub nom. United States v.
Brown, No. 983, O.T.1961.
In
United States v. North American Van Lines,
Inc., 202 F.
Supp. 639 (D.D.C.1962), the court refused to dismiss an
indictment of corporate officers, holding that they were not
charged with acting solely in a representative capacity. It went on
to say that, in any event, the Sherman Act applied to
representative acts. We are informed by the parties here that, in
United States v. Packard-Bell Electronics Corp.,
Cr.No.30158, S.D.Cal., a motion to dismiss was denied without
opinion. The indictment,
see 5 CCH Trade Reg.Rep. (1961),
par. 45,061, case 1632, charged violations of § 14 as well as of §
1.
[
Footnote 2/2]
Moore v. States, 48 Miss. 147 (1873);
Elsberry v.
State, 52 Ala. 8, 10 (1875);
Ex parte Schmidt, 2
Tex.App. 196 (1877);
Cowley v. People, 83 N.Y. 464, 469
(1881);
State v. Parsons, 12 Mo.App. 205 (1882);
City
of Wyandotte v. Corrigan, 35 Kan. 21, 26, 10 P. 99, 102
(1886). The only decision found to the contrary is
Commonwealth
v. Demuth, 12 S. & R. 389, 392 (Pa.1825), in which a
particular statute was read not to impose a duty on individual
officers. That this did not state a general rule even in
Pennsylvania was made clear by the Supreme Court of that State in
Commonwealth v. Ohio & P. R. Co., 1 Grant Cas. 329,
350 (1856) (dictum).
[
Footnote 2/3]
I find little support, however, for our conclusion in
United
States v. MacAndrews & Forbes Co., 149 F. 823
(C.C.S.D.N.Y.1906), or
United States v. Winslow, 195 F.
578 (D.Mass.1912), despite some of the language in those opinions.
Neither case squarely upholds criminal responsibility in a
"representative" capacity. Among other things, the court in
MacAndrews & Forbes declared it possible to infer from
the indictment that the corporations were
"doing one thing and the individuals another at or about the
same time, which things were utterly different. . . . It is
conceivable that the evidence may show that the individual
defendants were not free agents, but acted under a species of
corporate coercion, for which they should not be held personally
responsible; but it is impossible to arrive at this conclusion on
demurrer."
149 F. at 832. In
Winslow, the indictment charged the
officers with controlling the industry "by the device and means of
and through and in the names of" certain corporations. 195 F. at
591. Thus, all that was held in
MacAndrews & Forbes,
and all that needed to be held in
Winslow, was that
corporate officers are not shielded from criminal responsibility
when they act on their own individual account or when they use a
sham corporation as a means of furthering their personal ends.
Nor do I find much weight in the decisions since 1914 upholding
the applicability of the Sherman Act to representative crimes of
corporate officers; while the penalties for violating the two
statutes were identical, there was little incentive to argue to the
contrary. The most that can be said of the decisions since 1890 is
that they have suggested no doubt of the applicability of the
Sherman Act to corporate officers acting only in a representative
capacity.