*1 The matter before this court concerns the proposed modification of the 1962 consent decrees entered into between the United States and General Electric and Westinghouse Corporation. Under section IX of those decrees, this court retained jurisdiction to modify and enforce the various provisions of the decrees.

In December of 1976, the parties to the 1962 consent decrees jointly filed with this court proposals to modify that final judgment. After reviewing the competitive impact statement filed by the government, the memoranda of the parties and amici curiae, the numerous comments of interested parties, and after hearing oral argument on the various issues presented, this court finds that entry of the modifications as proposed by the government and the defendants is in the public interest and accordingly, the proposed modifications by consent will be approved.

The 1962 consent decrees grew out of a civil action filed by the government charging General Electric, Westinghouse, and Allis-Chalmers Manufacturing Corporation with fixing the price of large turbine generators and seeking injunctive relief against further violations of section 1 of the Sherman Act. That action ended with the entry of consent decrees against the corporations enjoining them from, inter alia, communicating pricing information to one another until after the information had been released generally to the trade.

In 1972, the government undertook an investigation of the competitive condition in the turbine generator industry. The investigation revealed that beginning in 1963 there had been an elimination of price competition between G. E. and Westinghouse. By December, 1962, Allis-Chalmers had withdrawn from the market for turbine generators and, therefore, is not a party to this proceeding, nor was it a target of the government's investigation. The government does not contend that the elimination of price competition was the result of any direct covert communication between the parties, but rather that it was the result of the conscious adoption and publication of identical pricing policies in 1963-64 and the strict adherence to those policies since that time.

In 1963 both General Electric and Westinghouse published similar and unusually extensive price books enabling each to predict not only the exact price that the other would bid in a particular situation, but also the precise type and size of the machine. Both companies also adopted a price protection plan which provided that if the price was lowered by a manufacturer for a particular customer, any buyer within the previous six month period would be given an identical discount retroactively. Thus, each manufacturer was assured that the other would not engage in discounting because of the substantial self-imposed penalty involved. Also, both companies published a list of outstanding bids whenever there was a price change so that there would be no confusion as to which customers were being charged the old rate and thus no suspicions of discounting would be aroused. These practices resulted in a pattern of equal pricing in the sale of large turbine generators and the government contends that contemporaneous internal documents indicate that this result was the deliberate intent of the defendants.

*2 The government concluded that it would be appropriate to file suit against G. E. and Westinghouse and informed them of its intention to do so. In the course of subsequent negotiations, the defendants, while vigorously denying any liability, agreed to a modification of the 1962 agreement whereby they would be precluded from publicly disseminating price information and enjoined from entering into price protection agreements with their customers. This modification would grant the government all the relief it would have sought in a Sherman Act suit, while avoiding the considerable delay and expense and the uncertainty of a trial.

The government mailed over 300 copies of the proposed modification to potential customers of large turbine generators requesting comments on the proposal.FN1 The responses generally supported the proposal with some suggestions for improvements and some objections. On September 9, 1977, this court held a hearing at which time all persons desiring to comment on the proposed modifications were permitted to do so. A representative of a number of utility companies appeared and urged that the court not approve the proposed modification unless it was conditioned on a disclosure of documentary evidence by the government supporting its view that the defendants were guilty of antitrust violations. The Philadelphia Electric Company appeared and joined in the request for the disclosure of documents. Additionally, Philadelphia Electric insisted that the public interest demanded that the decree include a provision requiring the defendants to pay “restitution” to past purchasers of turbine generators. I am not persuaded that it would be in the public interest to require the parties to adopt these two recommendations as a condition for my approval of the proposed modifications.

FN1 The United States contends that the Antitrust Procedures and Penalties Act, P. L. 93-528, 15 U. S. C. § 16(b) through (h), is not applicable to modification of consent decrees but applies only to their initial entry. Because we find the procedures actually followed by the government were in substantial compliance with the Act, we need not decide that issue.

First, this court does not have the power to order restitution in connection with a consent decree especially where, as here, there has been no admission or adjudication of guilt. Private parties who believe they have been injured by antitrust violations may bring suit for an injunction, 15 U. S. C. § 26, and/or damages, 15 U. S. C. § 15. It would be improper to intermingle such claims with a government enforcement action which necessarily embodies different policy consideration. Sam Fox Publishing Co. v. United States [1961 TRADE CASES P 70,030], 366 U. S. 683 (1961). Further, G. E. and Westinghouse will not consent to the payment of damages or restitution as a condition of these decree modifications. Therefore, to insist upon the payment of money to the utilities involved would in effect require the government to abandon the consent decrees and initiate a civil action with the accompanying expense, delay and uncertainty of outcome. Such a result in not in the public interest. Cf. United States v. Automobile Manufacturer's Assn. [1970 TRADE CASES P 73,070], 307 F. Supp. 617, 619-20 (C. D. Cal. 1969), aff'd per curiam sub nom. City of New York v. United States [1970 TRADE CASES P 73,109], 397 U. S. 248 (1970).

*3 While the court may have the power to condition its approval on the production of documents by the government, (see H. R. Rep. No. 93-1463, 93rd Cong., 2d Sess. 8 (1974), quoting S. Rep. No. 93-298 93rd Cong., 1st Sess. 6 (1973), reprinted in (1974) U. S. Code Cong. & Ad. News (6538-39), there is no requirement that I do so. The overriding duty of this court is to determine whether entry of the decree would be in the public interest. 15 U. S. C. § 16(e). And although I have given appropriate consideration to the impact of our decision on private antitrust plaintiffs, I find that any benefit that those plaintiffs might derive from disclosure is outweighed by the benefit to the public to be derived from the prompt implementation of the proposed decrees which eliminates non-competitive pricing practices.

Moreover, the parties requesting disclosure admit that they have access to the defendants' internal documents by means of a “standstill” agreement entered into in connection with a private antitrust action now pending before another court. Thus, their interest in having the government disclose the documents it has obtained is minimal. Additionally, the requesting parties have alternative means of obtaining any further documents they might require to effectively litigate any future private action. These means include discovery, subpoena, and also the Freedom of Information Act, 5 U. S. C. § 552.

On the other hand, the government contends, and this court agrees, that the disclosure of evidentiary materials in connection with the entry of consent decrees would greatly diminish the availability of this useful tool in the enforcement of the antitrust laws. It is probable that many more antitrust defendants will choose to litigate rather than enter into consent decrees that are conditioned on the broad disclosure of documents that could be used against them in civil damage actions. The resulting increase in litigation is clearly not in the public interest, especially where, as in this case, the government can obtain by consent all the relief it would have sought had the case gone to trial.

I have reviewed the numerous comments presented to the court by other utilities and interested parties and have found them helpful in understanding the nature of the problem presented by this case. It is my conclusion that the public interest is best served by approving the modification of the decrees without change.

E.D.Pa. 1977.

U. S. v. General Electric Co.

Not Reported in F.Supp., 1977 WL 1474 (E.D.Pa.), 1977-2 Trade Cases P 61,659