Evening star., 1953-04-10
Civil Suit Planned
Against Oil Firms
Accused Of Cartel
By w. H. ShipDen

Wiling To-Day TO drop criminal
action while pressing a civil suit
against major oil companies in
an alleged international cartel.
Attorney General Brownell in
dicated yesterday this course will
be recommended in Federal
Court here before the scheduled
resumption of a grand jury in
quiry April % into the activities
of the companies overseas.
Mr.. Brownell pointed out, how
ever, that a decision on the GRIM
inal proceedings will be up to
the court. The grand jury inves-
tigation was halted January 28
to allow the new Attorney Cen
eral to evaluate the case in the
light of national security.
Document Deal Offered.
The new administration fell
heir to the antitrust fight after
the decision was taken under
former Attorney General Nc
Granery to seek criminal indict-
ments against the companies.
Shortly before former Presi-
dent Truman left Office, however,
he directed Mr.. McGranery to
learn from the companies if
they would surrender documents
subpoenaed by the court on con-
dition that the criminal action
be dropped in favor Of a. civil
suit.
The offer was rejected by vir-
tually all of the companies. A
spokesman for one of the largest,
Standard Oil of New Jersey. de-
clared acceptance would spread
trade secrets on the record which
"the Russians would give their
eye-teeth to get"
Consent Decree Asked.
The Justice Department said
then that while a criminal trial
might reveal company secrets,
these matters could be kept con-
f1dential in a civil action. The
spokesman added the companies.
if they accepted the offer, would
have to sign a consent decree to
abandon any practices found
Objectionable.
The attorney for Standard Oil
declared his company had COM
mitted no illegal acts and did
not feel it had to sign a consent
decree. Other large companies
involved are the Standard Oil
of California, Socony-Vacuum
Oil Co.. Gulf Oil, the Texas Co.,
the BritiSh-owned Iraq Petrole-
UNI Co., and the Dutch-owned
Shell.
In New York yesterday, Off
cialS Of two oil companies said
they saw no basis for the civil
proceeding announced by Mr..
BroWnell.
Frank w. Abrams, board
chairman for Standard Oil of
New Jersey, denied his firm is
member of any international
oil cartel. George v. Holton,
board chairman of Socony-
Vacuum, said all it's operations
are lin complete harmony with
all applicable laws of the United
States. including the antitrust
laws"
Mr.. Brownell said yesterday
that the decision to file a civil
complaint was the result Of dis
cussions with President Eisen-
hover, cabinet officers. and the
chairman of the Joint Chiefs of
Staff. The action was prompted,
he said, "in view of existing
world tensions" and in the
interest of national security"
Backed by Other Agencies.
Mr.. Brownell pointed out that
this general policy has the in
dorsement of two Presidents, two
Secretaries of State or their
principal representatives, two
Secretaries of Defense" as well
as the Central Intelligence
Agenc yand the chairman of the
Joint Chiefs of Staff.
He said the suit will be fol-
lowed by an application to the
U. S. Court for the District of
Columbia for an order to the
companies to produce documents
relating to their operations
abroad.
Mr.. Brownell explained that
civil procedures are broad
enough to provide that records
now under subpoena by the
grand jury be produced in the
civil action.
Security Measures Planned.
Through the records Federal
attorneys hope to learn what
impact the activities of the al
legged cartel has upon the foreign
commerce Of the United States.
Extraordinary precautions will
be taken, Mr.. Brownell said, to
guard against the public dis
closure of documents which
might have an adverse effect
upon the national security"
To insure secrecy, a screening
committee will be set up. Mem
mebrS are to include represen-
tatives of the State. Defense and
Justice Departments, and the
Central Intelligence Agency.
President Eisenhower, Mr..
Brownell said, will be called upon
to settle any difference of opin-
ion as to the harmful effect of
nIlhliShinC tho documents