The opinion of the court was delivered by: HAROLD H. GREENE
Defendant NYNEX has filed several motions, in addition to the many previously filed and disposed of by the Court.
There is also one new motion by the government. None of the recent motions has substantial merit, and all of them must be denied.
NYNEX requests that the indictment be dismissed for failure to charge that that corporation committed the offense. This request is based upon the claim that, even though NYNEX is identified in the indictment as the defendant -- indeed the sole defendant -- the actual perpetrator of the allegedly unlawful acts is its subsidiary Telco Research. The request is not well taken.
The indictment, as noted, specifies that NYNEX committed the allegedly unlawful acts in that it "did willfully disobey this Court's lawful and specific Order by providing information services." Indictment P8. Further, in a separate allegation, the indictment charges that "NYNEX" engaged in the prohibited activities "through Telco Research." Indictment P9. These allegations alone are adequate to charge that that corporation committed the offense.
At most, NYNEX's papers could be read to claim that NYNEX did not commit or could not have committed the prohibited acts because Telco Research was alien to it. However, that would be a matter to be addressed during or at the conclusion of the trial, in the context of a motion for an acquittal; it does not go to the viability of the indictment. As the government correctly notes, there is no requirement that the indictment specify in detail how the prosecution expects to go about proving the charges. See, e.g., United States v. Edmond, 288 App. D.C. 17, 924 F.2d 261, 269 (D.C. Cir. 1991); United States v. Shorter, 608 F. Supp. 871, 874 n.2 (D.D.C. 1985), aff'd, 257 App. D.C. 358, 809 F.2d 54 (D.C. Cir. 1987).
There are also several more detailed theories which the government advances, and which at least at this juncture are entirely sufficient to support the indictment herein against the NYNEX motion.
First, NYNEX may be held criminally liable under several clauses of the decree for the conduct of its wholly-owned subsidiaries. Thus, the information services restriction in section II(D) of the decree applies to any Regional Company,
such as NYNEX, acting "directly or through any affiliated enterprise." Similarly, section IV(C) of the decree defines Regional Company inter alia as any "entity directly owned or controlled by a [Regional Company] or affiliated through substantial common ownership." And NYNEX has a duty under section III of the decree to ensure that all its subsidiaries and their employees carry out the terms of the decree. See Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 771-72, 81 L. Ed. 2d 628, 104 S. Ct. 2731 (1984); United States v. Western Electric Co., 254 App. D.C. 415, 797 F.2d 1082, 1088 (D.C. Cir. 1986).
Second, the courts will disregard the corporate form where the notion of legal entity is used to protect fraud or crime. See, e.g., Anderson v. Abbott, 321 U.S. 349, 363, 88 L. Ed. 793, 64 S. Ct. 531 (1944); United States v. Milwaukee Refrigerator Transit Co., 142 F. 247, 255 (E.D. Wis. 1905). This doctrine may be particularly apt in the present factual situation, if it is true that, as the government claims, NYNEX transferred its Telco Research subsidiary to a group of its managers following the return of the indictment in this case in order to frustrate that indictment.
The motion will be denied.
NYNEX has moved to prohibit the government from amending the indictment. The motion will be denied.
In the first place, what NYNEX is really requesting is relief from an anticipated effort by the prosecution to adduce certain evidence at the trial. That type of relief is not properly sought with reference to the indictment but rather by an objection at the trial itself to the use of certain testimony or other evidence as it is being proffered by the prosecution. That is not a mere technicality because it is far more difficult for a court to determine the admissibility of evidence in the abstract, as it were, rather than in the context of other evidence as well as opening statements and the like. The motion is subject to denial on that basis.
Although both parties have filed voluminous briefs,
two principal issues have emerged from the papers.
First. NYNEX argues that incidents of on-line telephone access to Telco Research that arose in connection with studies that MCI did for Rockwell International and others were not pursuant to any of the three contracts referred to in the indictment and hence are not part of the offense charged therein. See Stirone v. United States, 361 U.S. 212, 217, 4 L. Ed. 2d 252, 80 S. Ct. 270 (1960). In this regard NYNEX relies upon language in paragraph nine of the indictment which charges, in the singular, that NYNEX ...