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UNITED STATES v. AT&T

August 1, 1980

UNITED STATES of America, Plaintiff,
v.
AMERICAN TELEPHONE & TELEGRAPH COMPANY; Western Electric Co.; Bell Telephone Laboratories, Inc., et al., Defendants



The opinion of the court was delivered by: GREENE

The basic issue regarding the test care materials is whether, notwithstanding their appearance as hearsay documents, they may be admissible for the truth of the matters stated *fn2" under one or more of the Federal Rules of Evidence. In this regard, the materials divide into three categories. *fn3" The first consists of statements by government officials *fn4" in various forms which defendants claim are admissions by party-opponents and therefore admissible as non-hearsay under Rule 801(d)(2). The second and third categories constitute designations by the government, one consisting of various paragraphs of decisions by the Federal Communications Commission and state public utilities commissions, the other being a report by the FCC and materials used in the preparation of that report. The government asserts that the materials in both categories may be admitted under the public records exception to the hearsay rule contained in Federal Rule of Evidence 803(8)(C).

 I-Admissions by Government Officials

 The government in response does not argue that the statements were made outside the scope of the employment of these officials. Instead it contends that for purposes of the party-opponent admissions rule the "plaintiff" in this case should not be deemed to encompass the Executive Branch in its entirety, but should be limited to the Department of Justice.

 The government acknowledges, as it must, that in the Court's Opinion of September 11, 1978, *fn7" and in Pretrial Order No. 10 of the same date, it was held that all Executive Branch agencies, departments and subdivisions comprise the plaintiff in this case, but it asserts that this holding was and should be limited to questions of discovery under Rule 34 of the Federal Rules of Civil Procedure. That is taking too narrow a view of what was decided at that time.

 In its September 11, 1978, Opinion the Court noted that this action was instituted on behalf of the United States under the antitrust laws, which "constitute a means for protecting the economic interests of the citizens of this country, not infrequently on a national scale," and that the "theory of the government's case and the relief requested are national in scope and they are likely to involve the documents and activities of a great number of government departments." *fn8"

 In the view of the Court, the concerns and activities of the government generally are implicated by this antitrust suit, not merely those of the Department of Justice, and that is true irrespective of whether the particular issue involves rules of discovery or rules of evidence. In either context, it "makes no sense to hold that the Department of Justice, which essentially is a law office, alone comprises the United States." *fn9" Moreover, although the authorities on the subject are sparse, what little there is regards the Department of Justice and the Attorney General not as the plaintiff but as plaintiff's counsel, representing the "Government of the United States acting on behalf of its citizens." *fn10"

 But, it is argued, any definition of the plaintiff as comprising the government generally in the present context would contradict the rationale of Rule 801(d)(2). Citing McCormick *fn11" and the Advisory Committee Notes, the government claims that Rule 801(d)(2) treats statements by party-opponents as non-hearsay (a) because the party against which the statement is being used has no need to challenge the trustworthiness of its own statement and (b) because that party has the ability to provide an explanation for the statement should the need therefor arise. Government officials from different executive departments, it is said, represent a variety of diverse and often conflicting interests, and explanations of their statements at trial could be secured by the Department of Justice only through a massive effort. These arguments cannot be accepted, for a number of reasons.

 First, the admissibility of an admission by a party-opponent is a consequence, not of trustworthiness or lack of burdensomeness, but of the adversary system of litigation. The Advisory Committee Notes on the Federal Rules of Evidence explained that

 See also McCormick, Evidence, § 262; *fn12" 4 Weinstein's Evidence, P 801(d)(2) (01) at 801-136. The adversaries in this litigation are not the Department of Justice and the Legal Office of AT&T; they are the United States of America and the American Telephone and Telegraph Company, Western Electric Company, and Bell Telephone Laboratories.

 A second and related reason for rejecting the government's position is that its arguments would apply with equal force to any large organization with many individuals speaking and acting on its behalf. Were the Court to accept the government's reasoning, all such organizations would effectively have to be exempted from the purview of the rule on party-opponent admissions. The unambiguous language of Rule 801(d)(2) clearly does not contemplate such a result.

 Finally, the underlying theoretical premise of the government's argument is troubling and cannot be accepted. Its argument in effect is that, whenever the purpose of a rule-whether of pleading or of evidence-would be better effectuated by altering the configuration of a party to which it is applicable, then the definition of that party must be changed in midstream. Carried to its logical conclusion, this position would force the courts to change the shape and size of parties, particularly in complex litigation, depending upon the part of the case being tried and the principles of law and procedure that may be relevant at any given moment. These chameleon-like shifts in the identity of the parties would upset the orderly conduct of such litigation.

 For these reasons, the Court rejects the proposition that the plaintiff in this case for the purposes of the rules of evidence is the Department of Justice; it holds, as it did on September 11, 1978, that the plaintiff is the United States; *fn13" and it concludes that the statements contained in the three test case documents in question (see note 6 supra ) constitute admissions by a party-opponent under Rule 801(d)(2). *fn14"

 II-Decisions by Regulatory Commissions

 Among the test case materials which the government proposes to offer as evidence for the truth of the matters asserted therein are portions of orders and decisions in six FCC dockets (Nos. 8963, 19528, 19896, 19919, 20097, 20288) and in one state regulatory proceeding (Colorado P.U.C. Docket No. 881). The government contends that these materials, though hearsay, are admissible into evidence under the "public records" exception to the hearsay rule codified in Rule 803(8)(C), which excepts from the hearsay rule

 
Records, reports, statements, or data compilations, in any form, of public offices and agencies, setting forth ... (C) in civil actions and proceedings ..., factual findings resulting from an investigation made pursuant to authority granted by law, unless the sources of information or other circumstances indicate lack of trustworthiness.

 In view of the disparate character of the different dockets, both procedurally and substantively, it is not feasible to make a blanket finding of admissibility or non-admissibility for the materials in this category. For that reason the Court has examined each docket and designated paragraphs within each docket in light of the requirements of Rule 803(8)(C) and has made determinations on that basis as to whether exclusion is or is not warranted. In its determinations the Court has been guided by the Advisory Committee Notes, prepared by the framers of the Rules, which state that Rule 803(8) "assumes admissibility in the first instance, but with ample provision for escape if sufficient negative factors are present." *fn15"

 A. Factual Findings Resulting from an Investigation Authorized by Law

 The Federal Communications Commission is clearly authorized to hold hearings on investigations into newly filed charges, regulations, and practices (section 204 of the Communications Act, 47 U.S.C. § 204) either in response to a complaint or on its own motion (section 403 of the Communications Act, 47 U.S.C. § 403) and the Colorado Public Utilities Commission is similarly authorized to conduct its investigations (Colo.Rev.Stat. §§ 40-3-111, 40-4-101, 40-6-101 et seq. (1973)). Thus, the first part of the Rule 803(8)(C) test is met.

 The next issue to be examined is whether the materials constitute "factual findings resulting from an investigation." The legislative history of Rule 803(8)(C) is unfortunately contradictory, some of it indicating that the public records exception to the hearsay rule was intended to be limited to routine reports memorializing past facts observed by the investigator, other history supporting the view that it also embraces so-called "evaluative reports." Thus, the report of the House Judiciary Committee stated that "(t)he Committee intends that ... "factual findings' be strictly construed and that evaluations or opinions contained in public reports shall not be admissible under this Rule." Report of the Committee on the Judiciary, H.R.Rep.No.93-650, 93d Cong., 1st Sess. 14 (1973), U.S.Code Cong. & Admin.News 1974, pp. 7051, 7088. The Senate Judiciary Committee, on the other hand, noting that the "Advisory Committee assumes admissibility in the first instance of evaluative reports," took strong exception to the House ...


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