The opinion of the court was delivered by: HOLTZOFF
This case is now before the Court on a motion of the defendants for a judgment of acquittal. This is a criminal prosecution on a charge of conspiracy to violate Section 3 of the Sherman Anti-Trust Act, 15 U.S.C.A. § 3, the pertinent provisions of which read as follows: 'Every contract, combination * * * or conspiracy, in restraint of trade or commerce in any Territory of the United States or of the District of Columbia, or in restraint of trade or commerce between any such Territory and another, or between any such Territory or Territories and any State or States or the District of Columbia, or with foreign nations, or between the District of Columbia and any State or States or foreign nations, is declared illegal.'
At the close of the Government's case, the defendants moved for a judgment of acquittal.
The principles to be applied in determining a motion for a judgment of acquittal in a criminal case were well summarized by the Court of Appeals in Curley v. United States, 81 U.S.App.D.C. 389, 392, 160 F.2d 229, 232, in the following words: 'The true rule, therefore, is that a trial judge, in passing upon a motion for directed verdict of acquittal, must determine whether upon the evidence, giving full play to the right of the jury to determine credibility, weigh the evidence, and draw justifiable inferences of fact, a reasonable mind might fairly conclude guilt beyond a reasonable doubt. If he concludes that upon the evidence there must be such a doubt in a reasonable mind, he must grant the motion; or, to state it another way, if there is no evidence upon which a reasonable mind might fairly conclude guilt beyond reasonable doubt, the motion must be granted. If he concludes that either of the two results, a reasonable doubt or no reasonable doubt, is fairly possible, he must let the jury decide the matter. In a given case, particularly one of circumstantial evidence, that determination may depend upon the difference between pure speculation and legitimate inference from proven facts.'
Substantial evidence of guilt is required to justify the submission of a case to the jury. A mere scintilla of evidence is not enough.
Although this is a trial without a jury, the motion for a judgment of acquittal at the close of the Government's case performs the same functions and is governed by the same considerations as a similar motion at a trial by jury.
The Sherman Anti-Trust Act provides two methods of enforcement: a criminal prosecution and a civil action for an injunction. In this case the government has chosen to proceed by way of an indictment. Consequently, all the rights and safeguards that hedge a defendant in a criminal case are to be extended to the defendants in this proceeding. The additional burden that must be borne by the government in a criminal case, as compared with a civil action, must be carried by the government in this instance.
Thus, the defendants are clothed with a presumption of innocence which attaches to them throughout the trial. The government has the burden of proving guilt beyond a reasonable doubt. If the evidence on which the government relies is entirely circumstantial, it must be of such character as to exclude every reasonable hypothesis except that of guilt. A conspiracy may, indeed, be established by circumstantial evidence. Nevertheless, such evidence must meet the standard just mentioned. Thus the onus that must be borne by the government is much heavier than would have to be sustained by it in a civil case. The government has, however, made its choice. The principles that I have just summarized are purely elementary but it is at times useful to bring back to mind elementary principles.
The defendant Maryland & Virginia Milk Producers' Association is a cooperative association of farmers who ship milk to the City of Washington and its environs, and who are generally called 'producers.' The individual defendant B. B. Derrick is the Secretary-Treasurer of the association. The remaining seven defendants are corporations that are engaged in the business of selling and distributing milk at retail and wholesale in Washington and nearby Maryland and Virginia. Each of them purchases all or most of its supply of milk from the producers' association which, in turn, acts as the exclusive agent for its members.
It is charged in substance that the defendants have combined to restrain trade and commerce in milk, to fix the prices at which milk should be sold by the producers to the distributors and by the distributors to the public, and to suppress competition.
First, the government charges that the defendants have developed and operated a scheme of exclusive or so-called 'full supply' contracts entered into between the Producers' Association and each distributor, whereby the latter agrees to buy his entire supply of milk from the Association and the Association undertakes, in turn, to furnish all the milk required by the distributor. An integral part of this series of arrangements is claimed to be a uniform method of computing the price to be paid by each distributor for the milk purchased by him. It is an elaborate formula, known variously as the classification plan or as the use plan. All milk sold to the distributors is divided into three classes according to the manner in which the milk is used by them. Class 1 consists of milk resold by the distributors as fluid milk. Class 2 is composed of milk transformed into cream. Class 3 comprises all unsold or surplus milk that each distributor finds on his hands and which he sells for manufacture into by-products such as ice cream, cheese, and other dairy products. A different price is paid for the milk in each category, although in each instance the milk is of the same grade and quality. The Association periodically audits the books of every distributor in order to ascertain the amount used from him.
Second, the government charges that the prices to be paid by the distributors were fixed by the joint action of the Producers' Association and the distributors. The illegality in this procedure is claimed to be found in the fact that each distributor did not negotiate with the Producers' Association individually and separately, but that all the distributors bargained with the Association collectively as a group.
Third, the government charges that the Producers' Association and the distributors jointly fixed prices to ...