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Timestamp: 2019-05-19 22:31:39
Document Index: 360450560

Matched Legal Cases: ['§ 4', '§ 5', '§ 4', '§ 1', '§ 5', '§ 5', '§ 657']

EMICH MOTORS CORP. V. GENERAL MOTORS CORP., 340 U. S. 558 - Volume 340 - 1951 - Full Text - US Supreme Court Center - USSC Cases - Nolo
US Supreme Court Center > Volume 340 > EMICH MOTORS CORP. V. GENERAL MOTORS CORP., 340 U. S. 558 (1951) > Full Text
EMICH MOTORS CORP. V. GENERAL MOTORS CORP., 340 U. S. 558 (1951)
Emich Motors Corp. v. General Motors Corp., 340 U.S. 558 (1951)
1. In this suit under § 4 of the Clayton Act to recover treble damages for injuries sustained by reason of a conspiracy in restraint of trade, plaintiffs were entitled under § 5 to introduce a prior criminal judgment based on a conviction of defendants for the same conspiracy in order to establish prima facie all matters of fact and law necessarily decided by the conviction and the verdict on which it was based. Pp. 340 U. S. 566-569.
2. Where the criminal judgment rests on a general verdict of the jury, what was decided by that judgment must be determined by the trial judge hearing the treble damage suit, upon an examination of the record, including the pleadings, the evidence submitted, the instructions under which the jury arrived at its verdict, and any opinions of the court. P. 340 U. S. 569.
3. The criminal judgment involved in this case was prima facie evidence of a general conspiracy for the purpose of monopolizing the financing of General Motors cars, and also of the effectuation of that conspiracy by coercing General Motors dealers to use its subsidiary finance company's services. Pp. 340 U. S. 570-571.
4. In order to establish their prima facie case, it therefore was only necessary for plaintiffs to introduce, in addition to the criminal judgment, evidence of the impact of the conspiracy on them and evidence of any resulting damages. P. 340 U. S. 571.
5. What issues were decided by the criminal conviction is a question of law on which the judge must instruct the jury. He should (1) examine the record to determine the issues decided by that judgment; (2) in his instructions to the jury reconstruct that case in the manner and to the extent he deems necessary to acquaint the jury fully with the issues determined therein, and (3) explain the scope and effect of the former judgment on the case at trial. Pp. 340 U. S. 571-572.
The case is remanded to the Court of Appeals with directions to modify its judgment, p. 340 U. S. 572.
This action was brought in the United States District Court for the Northern District of Illinois under § 4 of the Clayton Act [Footnote 1] to recover treble damages for injuries alleged to have been suffered by reason of a conspiracy in restraint of trade in violation of the Sherman Act, § 1. [Footnote 2] Plaintiffs, petitioners here, are Emich Motors Corporation, a former dealer in Chevrolet cars, and its related finance company, U.S. Acceptance Corporation. Respondents are General Motors Corporation and its wholly owned subsidiary finance company, General Motors Acceptance Corporation (GMAC).
"A final judgment or decree rendered in any criminal prosecution or in any suit or proceeding in equity brought by or on behalf of the United States under the antitrust laws to the effect that a defendant has violated said laws shall be prima facie evidence against such defendant in any suit or proceeding brought by any other party against such defendant under said laws as to all matters respecting which said judgment or decree would be an estoppel as between the parties thereto. . . . [Footnote 3]"
"The specific conduct embraced within the illegal concert of action is described in paragraphs 36 to 67 of the indictment . . . : (1) requiring dealers to promise to use GMAC exclusively as a condition to obtaining a franchise for the sale, transportation and delivery of automobiles; (2) making contracts for short periods and cancelable without cause, canceling or threatening to cancel such contracts unless GMAC facilities are used; (3) discriminating against dealers not using GMAC by refusing to deliver cars when ordered, delaying shipment, and shipping cars of different number, model, color and style; (4) compelling dealers to disclose how they finance their wholesale purchases and retail sales, examining and inspecting dealers' books and accounts in order to procure this information, and requiring dealers to justify their using other financing media; (5) giving special favors to dealers using the wholesale and retail facilities of GMAC; (6) granting special favors to GMAC which are denied to other discount companies; (7) giving dealers a rebate from the GMAC finance charge paid by the retail purchaser in order to induce use of GMAC financing facilities, and (8) compelling dealers to refrain from using other finance companies by all other necessary, appropriate or effective means. [Footnote 4] "
the GMAC representative that these problems would disappear if he used GMAC. In 1936, Emich was given his 'last warning,' the zone manager telling him that he was going to make an example of Emich for his failure to use GMAC. Not long thereafter, Emich was canceled as a dealer, and he appealed to the president of General Motors, where he pleaded that, in a period of four years, he had done a gross business of around $3,000,000. The president of General Motors told him that he had been canceled because he did not use GMAC, that it was the policy of the corporation to require dealers to use GMAC, and that, if Emich would not agree to use GMAC, it would be useless for the president of General Motors to discuss his reinstatement. . . . [Footnote 5]"
After explaining the term "prima facie evidence," the court then summarized § 5 of the Clayton Act and charged that
and that "such acts and means are not to be considered as established by the finding of guilt." It concluded that the use of the indictment as evidence was aggravated by the instruction of the trial judge last quoted and italicized in part, supra, p. 340 U. S. 565.
The evidentiary use which may be made under § 5 of the prior conviction of respondents is thus to be determined by reference to the general doctrine of estoppel. As this Court has observed, that "principle is as applicable to the decisions of criminal courts as to those of civil jurisdiction." Frank v. Mangum, 237 U. S. 309, 237 U. S. 334 (1915); Sealfon v. United States, 332 U. S. 575, 332 U. S. 578 (1948). It is well established that a prior criminal conviction may work an estoppel in favor of the Government in a subsequent civil proceeding. United States v. Greater New York Live Poultry Chamber of Commerce, 53 F.2d 518 (1931), aff'd sub nom.
Local 167 v. United States, 291 U. S. 293 (1934); Farley v. Patterson, 166 App.Div. 358, 152 N.Y.S. 59 (1915); see State v. Adams, 72 Vt. 253, 47 A. 779 (1900); 2 Freeman, Judgments (5th ed.1925,) § 657. Such estoppel extends only to questions "distinctly put in issue and directly determined" in the criminal prosecution. See Frank v. Mangum, supra, at 237 U. S. 334; United States v. Meyerson, 24 F.2d 855, 856 (1928). In the case of a criminal conviction based on a jury verdict of guilty, issues which were essential to the verdict must be regarded as having been determined by the judgment. Cf. Commonwealth v. Evans, 101 Mass. 25 (1869). Accordingly, we think plaintiffs are entitled to introduce the prior judgment to establish prima facie all matters of fact and law necessarily decided by the conviction and the verdict on which it was based.
The difficult problem, of course, is to determine what matters were adjudicated in the antecedent suit. A general verdict of the jury or judgment of the court without special findings does not indicate which of the means charged in the indictment were found to have been used in effectuating the conspiracy. And since all of the acts charged need not be proved for conviction, United States v. Socony-Vacuum Oil Co., 310 U. S. 150 (1940), such a verdict does not establish that defendants used all of the means charged or any particular one. Under these circumstances, what was decided by the criminal judgment must be determined by the trial judge hearing the treble damage suit, upon an examination of the record, including the pleadings, the evidence submitted, the instructions under which the jury arrived at its verdict, and any opinions of the courts. Sealfon v. United States, supra; cf. Oklahoma v. Texas, 256 U. S. 70 (1921). [Footnote 6]
United States v. General Motors Corp., 121 F.2d 376, 397 (1941). The same conclusion was reached by this Court in Ford Motor Co. v. United States, 335 U. S. 303 (1948), where it was required for another purpose to determine what was necessarily found by the jury verdict in the criminal proceeding against General Motors and GMAC. [Footnote 7]
cars, and also of its effectuation by coercing General Motors dealers to use GMAC. To establish their prima facie case, it therefore was necessary for petitioners only to introduce, in addition to the criminal judgment, evidence of the impact of the conspiracy on them, such as the cancelation of their franchises and the purpose of General Motors in canceling them, and evidence of any resulting damages. [Footnote 8] From this it follows that the Court of Appeals was in error when it held that the judgment was prima facie evidence only of a conspiracy by respondents.
What issues were decided by the former Government litigation is, of course, a question of law as to which the court must instruct the jury. It is the task of the trial judge to make clear to the jury the issues that were determined against the defendant in the prior suit, and to limit to those issues the effect of that judgment as evidence in the present action. As to the manner in which such explanation should be made, no mechanical rule can be laid down to control the trial judge, who must take into account the circumstances of each case. He must be free to exercise "a well established range of judicial discretion." Nardone v. United States, 308 U. S. 338, 308 U. S. 342 (1939). He is not precluded from resorting to such portions of the
335 U.S. at 335 U. S. 316-319. Relevant portions of the instructions are set forth at p. 335 U. S. 316, n. 3.
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