Evening star., 1952-10-02
Identical Bids Offered
On Navy Oil, Court
Is Told in Cartel Case
By Howord [. Dutkin

A group of large oil companies
submitted identical bids in 1850
to an armed forces procurement
agency which wanted oil for
United States naval vessels, Leon
ard j. Emmerglick. special as
sistant to the Attorney General,
said today.
The action, Mr.. Emmerglick
told District Judge James r.
Kirkland, comprised an overt act
in furtherance of an alleged con-
Spiracy to control the oil industry
In violation of antitrust laws.
Mr.. Emmerglick named the fol-
lowing companies as involved in
the bidding:
Caltex Oceanic; Mideastern
Sales. a subsidiary of Socony
Vacuum; Socony Vacuum Oil Co.,
and the Esso-Export Co., a sub =
sidiary of Standard Oil.
Conspiracy Traced to '28.
Mr.. Emmerglick charged that a
conspiracy to control the produc-
tion, refining and transportation
of petroleum took shape in 1928 at
a meeting at the London grouse
hunting seat of Sir Henri Deter
ing, then head of Royal Dutch
Shell.
Present at the meeting, he de-
clared, were the chief executives
of the Standard Oil Co. of New
Jersey, an organization which later
became the Anglo-Iranian Co. and
Royal Dutch Shell.
The operators, he said, then
agreed to avoid competition.
AS a result of this agreement,
Mr.. Emmerglick asserted, an ex-
port association was registered in
the District which, he said, af-
fected all oil produced in the
United States for shipment over
seas.
Jurisdiction Questioned.
Mr.. Emmerglick told the United
States District Court for the Dis
trict of Columbia he was loath to
reveal this information in ad-
vance of any possible indictments
by a special District grand jury
investigating oil cartel possibilities.
But he felt the revelation was
necessary since the jurisdiction of
the court and the grand jury was
under fire by counsel representing
five major oil companies.
Attorneys for the companies
had argued yesterday that the
District had no jurisdiction be-
cause there was no evidence of
any offense being committed here
by the companies. The oil organ
izationS are seeking to have the
action transferred to the southern
district of New York on the
grounds that their main Offices,
most of their personnel and rec
ords are situated in that State.
The Justice Department yester-
day was accused of packing" the
grand jury so as to stack the cards
against the oil companies.
The charge was hurled by At
torney Sal Morgan, representing
the Texas Co., during arguments
on motions before Judge Kirkland.
In his blast at the Justice De-
partment, Mr.. Morgan declared: !:
I"They have a packed grand jury
that will do anything they ask
them to do"
U. S. Employees on Panel.
His argument apparently was
based on charges made earlier by
Leon Kissam, attorney for the CAL
ifornia-Texas Co.. who asserted the
grand jury proceedings were un-
fair in that the panel included IA
Federal employees. eight of whom,
he said, were employed by agencies
connected with the oil case.
Mr.. Morgan told the court: "It
is foregone conclusion that we
are going to be indicted and will
suffer the damages that confront
us as indicted citizens of the
United States when we go out to
these foreign countries" to conduct
oil operations.
Attorney David Searles, repre-
senting the Arabian-American Oil
Co., declared his organization con-
Quoted all it's business outside the
United States in Saudi-Arabia.
$50 how can we be indicted
here?" he asked.
Answering the arguments, Mr..
Emmerglick, told the court the
companies entered into a con-
Spiracy with overt acts committed
in the District beginning as far
back as 1928.
"The conspiracy was furthered
by overt acts in the District,
where considerable petroleum
products are purchased by the
United States, as well as by its
Citizens" he added.
Meanwhile, Judge Kirkland ex-
tended, until October 13, the re-
turn date for supoenas requiring
some 18 major oil companies to
produce all their records dating
back to 1928. The return date
L II u -