The opinion of the court was delivered by: GASCH
This action for civil penalties and equitable relief for violation of a Federal Trade Commission (hereinafter "FTC") cease and desist order is now before the Court on the motion of plaintiff, the FTC, to compel the production of about 60 documents, brought pursuant to Rule 37(a) of the Federal Rules of Civil Procedure. Defendant United States Steel Corporation objects to the production of these documents on the grounds of relevancy and the attorney-client privilege.
Defendant United States Steel Corporation objects to the production of any documents dated prior to January 1, 1968, on several grounds, all of which essentially pertain to the relevancy of these documents. Defendant Corporation claims that documents dated prior to January 1, 1968, are too far removed in time to be reasonably calculated to lead to the discovery of admissible evidence and that, since the applicable statute of limitations precludes recovery for any violations occurring more than five years prior to the date this suit was instituted, June 18, 1974, its January 1, 1968 cut-off date gives plaintiff a period of a year and a half prior to the statutory period of limitations to show a violation running into the period of limitations. United States Steel Corporation also points out that the FTC has investigated the subject matter of the instant action on several occasions from 1955 to 1964, without any suit being instituted, and claims that it should not be subjected to repeated investigations and discovery into this period. These objections to the production of the documents sought by the FTC are not well-taken.
The discovery rules should normally be liberally construed to permit discovery in antitrust cases. The courts have, as a result, frequently permitted discovery of information or documents relatively remote in time and in periods prior to the time when recovery may be had. E.g., Kansas City Star Co. v. United States, 240 F.2d 643 (8th Cir.), cert. denied, 354 U.S. 923, 1 L. Ed. 2d 1438, 77 S. Ct. 1381 (1957); Natcontainer Corp. v. Continental Can Co., 362 F. Supp. 1094 (S.D.N.Y. 1973); Quonset Real Estate Corp. v. Paramount Distributing Corp., 50 F.R.D. 240 (S.D.N.Y. 1970); Magee v. Carvehicle Corp., 7 F.R. Serv. 2d 33.353, Case 1 (E.D.N.Y. 1963); Toler v. Paramount Film Distributing Corp., 1 F.R. Serv. 2d 34.41, Case 2 (N.D. Cal. 1958); Erone Corporation v. Skouras Theatres Company, 22 F.R.D. 494 (S.D.N.Y. 1958). Such discovery has been permitted where, as here, a conspiracy to violate the antitrust laws is alleged, on the ground that it may lead to the discovery of admissible evidence of design, pattern or intent. See Quonset Real Estate Corporation v. Paramount Film Distributing Corp., supra; Toler v. Paramount Film Distributing Corp., supra; see also, Natcontainer Corp. v. Continental Can Co., supra; Erone Corporation v. Skouras Theatres Corporation, supra. Thus, in the instant case, documents dated prior to January 1, 1968, are relevant in that they may lead to the discovery of admissible evidence of design, pattern or intent. Defendant United States Steel Corporation's contentions that because of the statute of limitations violations occurring prior to this date would not be actionable and that the January 1, 1968 cut-off date gives the FTC a period of a year and a half prior to the period of limitations to show violations running into the statutory period ignore this fact.
There is one additional factor in the instant case. Defendant Corporation has produced several documents dated prior to January 1, 1968, yet it now objects to the production of other documents dated prior to January 1, 1968. Such selective production of pre-1968 documents certainly undercuts the strength of its objections to the production of pre-1968 documents.
The Court is not unmindful of the fact that defendant Corporation should not be subjected to discovery of documents from unreasonably remote time periods. See Erone Corporation v. Skouras Theatres Corporation, supra; Quonset Real Estate v. Paramount Film Distributing Corp., supra; Natcontainer Corp. v. Continental Can Co., supra. In the instant case, none of the documents the FTC seeks are dated prior to 1962. These documents which, at the most, antedate the institution of this action by twelve and a half years and the period of limitations by seven and a half years are not unreasonably or extremely remote in time. Thus, the discovery plaintiff seeks is limited to a reasonable period and will not be unduly burdensome to defendant Corporation. See Erone Corporation v. Skouras Theatres Corporation, supra; Natcontainer Corp. v. Continental Can Co., supra. These documents must, therefore, be produced, except to the extent that they are protected by the attorney-client privilege.
Defendant Corporation also objects to the production of six of the documents
sought by the FTC on the ground that these six documents are protected by the attorney-client privilege. These documents are letters or memoranda exchanged by the Corporation's counsel and various corporate employees. Defendant has supplied this Court with information as to the duties and positions of the recipients and senders of the memoranda or letters and a summary of their contents. The documents have been submitted to the Court, at its request, for in camera inspection.
The attorney-client privilege has been described in United States v. United Shoe Machinery Corp., 89 F. Supp. 357 (D. Mass. 1950), as follows:
The privilege applies only if (1) the asserted holder of the privilege is or sought to become a client; (2) the person to whom the communication was made (a) is a member of the bar of a court, or his subordinate and (b) in connection with this communication is acting as a lawyer; (3) the communication relates to a fact of which the attorney was informed (a) by his client (b) without the presence of strangers (c) for the purpose of securing primarily either (i) an opinion on law or (ii) legal services or (iii) assistance in some legal proceeding, and not (d) for the purpose of committing a crime or tort; and (4) the privilege has been (a) claimed and (b) not waived by the client.
Id. at 358-59. The party seeking the benefit of the privilege has the burden of demonstrating its applicability. Honeywell, Inc. v. Piper Aircraft Corporation, 50 F.R.D. 117 (M.D. Pa. 1970).
The FTC contends that defendant has failed to carry its ...