United States v. Greater Buffalo Press, Inc.

PETITIONER: United States
RESPONDENT: Greater Buffalo Press, Inc.
LOCATION: Clarence Williams’ House

DOCKET NO.: 821
DECIDED BY: Burger Court (1970-1971)
LOWER COURT:

CITATION: 402 US 549 (1971)
ARGUED: Apr 19, 1971
DECIDED: Jun 01, 1971

Facts of the case

Question

Media for United States v. Greater Buffalo Press, Inc.

Audio Transcription for Oral Argument - April 19, 1971 in United States v. Greater Buffalo Press, Inc.

Warren E. Burger:

Mr. Friedman you may proceed whenever you’re ready.

Daniel M. Friedman:

Mr. Chief Justice and may it please the Court.

This case which is here on a direct appeal to the United States District Court for the western district of New York, brings before the Court the validity of a 1955 merger between the two leading firms engaged in the printing of color comic supplements for newspapers.

The appeal presents a group of typical Section 7 questions, the definition of the relevant product market, the question whether the effect of the merger maybe substantially to lessen competition, the question whether the acquired company was a failing company and the question of whether divestiture was a appropriate relief.

There are three principal firms involved in this case which I will describe briefly.The acquiring firm, the appellee Greater Buffalo Press, at the time of the acquisition had a plant in Buffalo and also a plant in Dunkirk, New York.

The second firm is the acquired company, International Color Press.

At the time of the acquisition, it also had two plants, one in Wilkes Barre, Pennsylvania and the other in Peoria, Illinois but the Peoria plant has been closed.

The third principal actor in this story is a firm called King Syndicate, that is a division of the Hearst Corporation.

King itself is not a printer.

It is engaged in syndication of copywrited articles, features, comic scripts, cartoons, two newspapers.

What King does is engages in two forms of activity.

First, it licenses features to the newspapers and secondly, it arranges for the printing of those comic supplements to the newspapers that wish it.

The Government complaint which was filed in 1961 challenged not only the merger that is here before the Court but also alleged that Greater Buffalo, Hearst through King and another syndicate had engaged in a conspiracy to divide costumers, to fix prices and to monopolize the printing of color comic supplements alleged that King and the other newspaper syndicate had also engaged in illegal tying agreements under which the claim was that the licensing of the comic supplements was tied to the dealing with the syndicate for printing.

In 1965, the Government settled a case against Hearst through the entry of a consent judgment under which there were various prohibitions upon Hearst including a prohibition upon engaging in tying agreements although the judgment at that -- that judgment does not preclude King from quoting a single price for features and printing for the licensing that is and the printing.

However, that judgment also contains provisions that in the event Greater Buffalo is found to have violated any provision of the antitrust laws, the judgment may then be reopened.

The --

Potter Stewart:

Why does it take so long, 10 years?

Daniel M. Friedman:

10 Years, well, --

Potter Stewart:

Years exactly.

Daniel M. Friedman:

If I may Mr. Justice, I would just like to briefly describe about the chronology of it and explain why.

Warren E. Burger:

Excuse me Mr. Friedman, isn’t it more than 10 years?

Daniel M. Friedman:

Well, it's 10 years from the time the complaint was filed.

Warren E. Burger:

Yes, but it's 15 since the -- 16 since the merger occurred?

Daniel M. Friedman:

16 since the merger filed, let me -- if I may explain just what happened in this case.

The merger took place in 1955, two or three years thereafter, an employee of another firm made a complaint to the Department of Justice that Hearst was engaging in tie-ins.

Following this complaint and some preliminary investigation, there was a grand jury investigation in Buffalo, at the conclusion of the grand jury, the Government decided not to seek an indictment but instead to bring a civil suit.

Now, the original complaint did not relate of course to the merger, the original complaint related to the tie-ins by Hearst and King but in the course of our investigation, we developed other facts including the fact relating to the merger which led us to conclude that there were violations in addition to those that had been brought to our attention.

Now, the 10 years between the time that the complaint was filed and the case comes to this Court as occupied by a series of situations.

First, two or three years were occupied by the Government’s first successful attempt to obtain a preliminary injunction against Greater, the transfer of certain assets in the Wilkes Barre plant of international to a plant that had been built down in Sylacauga, Alabama.

Following that, we had the negotiations over the consent decree which led to the consent decree against Hearst.