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GREYHOUND CORP. ET AL. v. MT. HOOD STAGES, INC., DBA PACIFIC TRAILWAYS

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE

NINTH CIRCUIT

No. 77-598. Argued April 24, 1978-Decided June 19, 1978

On October 7, 1964, respondent motor carrier instituted a proceeding before the Interstate Commerce Commission in which it asked the ICC to reopen proceedings in which the ICC, over respondent's opposition, had approved petitioner's acquisition of several bus companies, alleging that petitioner had not lived up to representations that the acquisitions would not adversely affect respondent. On December 14, 1964, the United States petitioned for leave (and later was allowed) to intervene in the ICC proceeding, stating that respondent's allegations made "a serious charge" but that it did not know whether they were "true or false." After extensive hearings, the ICC decided against petitioner. In the meantime on July 5, 1968, respondent filed an action in District Court alleging, inter alia, violations of the federal antitrust laws, and the jury found violations of the Sherman Act and fraudulent concealment of such violations. The court held that the Government's petition to intervene in the ICC proceeding served to toll the statute of limitations under § 5 (i) of the Clayton Act (which provides that "[w]henever any civil or criminal proceeding is instituted by the United States to prevent, restrain, or punish violations of any of the antitrust laws, . . . the running of the statute of limitations in respect of every private . . right of action arising under said laws and based in whole or in part on any matter complained of in said proceeding shall be suspended during the pendency thereof and for one year thereafter"), with the result that the Act's four-year period of limitations extended back to December 14, 1960, when it was combined with fraudulent concealment to create a 20-year damages period. The Court of Appeals affirmed, holding that the literal wording of § 5 (i) was not controlling and that § 5 (i)'s purpose in furthering effective enforcement of the antitrust laws by permitting private litigants to benefit from governmental antitrust enforcement efforts would be advanced by treating the United States' petition to intervene as the "functional equivalent of a direct action" by the United States. Held: The Clayton Act's statute of limitations was

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not tolled under § 5 (i) by the filing of the Government's petition to intervene in the ICC proceeding. Pp. 330-337.

(a) The ICC proceeding was plainly not "instituted by the United States" within the meaning of § 5 (i). It strains accepted usage to argue that a party who intervenes in a proceeding instituted by someone else has also "instituted that proceeding." In fact, the United States not only did not institute the ICC proceeding but was not in a position to do so, since in view of its statement that it did not know whether respondent's allegations were "true or false," it could not in good faith have made the charging allegations necessary to institute the proceeding. Pp. 330331.

(b) Neither had the United States, within the meaning of §5 (i), "complained of" anything on which the District Court action was based, since in the ICC proceeding its petition to intervene charged petitioner with no wrongdoing, took no position on the merits, sought no relief, and disclaimed any knowledge of the relevant facts, seeking only an opportunity for respondent to establish its allegations. Pp. 331-332.

(c) What is now § 5 (i) was enacted to ensure that private litigants would have the benefit of prior Government antitrust efforts, and this purpose would not be served by construing § 5 (i) as applicable to the facts of this case, where respondent is seeking to benefit not from a Government antitrust action, but from an ICC proceeding respondent itself instituted. Pp. 332-334.

(d) Application of § 5 (i) to this case would also fail to give weight to Congress' purpose in amending the Clayton Act to provide a uniform four-year period of limitations and thus eliminate the prior confusion caused by determining the period of limitations by state law. P. 334. 555 F.2d 687, vacated and remanded.

BLACKMUN, J., delivered the opinion for a unanimous Court. BURGER, C. J., filed a concurring opinion, post, p. 337.

John R. Reese argued the cause for petitioners. With him on the briefs were Richard C. Brautigam, James H. Clarke, and Keith A. Jenkins.

Eugene C. Crew argued the cause for respondent. With him on the brief were Michael N. Khourie, Bruce M. Hall, and Donald A. Schafer.

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MR. JUSTICE BLACKMUN delivered the opinion of the Court. This case presents the issue whether § 5 (i) of the Clayton Act, as amended, 88 Stat. 1706, 90 Stat. 1396, 15 U. S. C. § 16 (i) (1976 ed.),' operates to toll the running of the Act's statute of limitations from the date on which the United States filed a petition for leave to intervene in an Interstate Commerce Commission proceeding previously instituted by the plaintiff.

2

I

Petitioner Greyhound and respondent Mt. Hood Stages, Inc. (doing business as Pacific Trailways), are motor common

1 Section 5 (i), as set forth in 15 U. S. C. § 16 (i) (1976 ed.), provides: "Whenever any civil or criminal proceeding is instituted by the United States to prevent, restrain, or punish violations of any of the antitrust laws, but not including an action under section 15a of this title, the running of the statute of limitations in respect to every private or State right of action arising under said laws and based in whole or in part on any matter complained of in said proceeding shall be suspended during the pendency thereof and for one year thereafter: Provided, however, That whenever the running of the statute of limitations in respect of a cause of action arising under section 15 or 15c of this title is suspended hereunder, any action to enforce such cause of action shall be forever barred unless commenced either within the period of suspension or within four years after the cause of action accrued."

2 Section 4B, 69 Stat. 283, as amended, 15 U. S. C. § 15b (1976 ed.). It provides:

"Any action to enforce any cause of action under sections 15, 15a, or 15c of this title shall be forever barred unless commenced within four years after the cause of action accrued. No cause of action barred under existing law on the effective date of this Act shall be revived by this Act."

3 Petitioner The Greyhound Corporation is a Delaware corporation that now is a diversified holding company owning, among other assets, all the issued and outstanding capital stock of petitioner Greyhound Lines, Inc., a California corporation. On December 31, 1963, The Greyhound Corporation discontinued its operation of scheduled common carrier bus service and transferred its motor carrier operating rights and properties to Greyhound Lines, Inc., App. 68; cf. Mt. Hood Stages, Inc., 104 M. C. C. 449, 465 (1968). For convenience, we refer to the two corporations collectively as

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carriers of passengers and package express and are subject to regulation by the Interstate Commerce Commission (ICC). Greyhound is the largest common carrier by bus in the United States. Mt. Hood is one of Greyhound's comparatively small competitors; it operates over routes in Oregon, Idaho, and Utah. Its principal routes are between Portland, Eugene, and Albany, Ore., in the west, and Salt Lake City, in the east, and between Klamath Falls, Ore., in the south, and Biggs and The Dalles, Ore., in the north. Greyhound's route authority surrounds that of Mt. Hood.

During the period from 1947 to 1956, Greyhound acquired control of eight bus companies operating in the Western United States. See Mt. Hood Stages, Inc., 104 M. C. C. 449, 450, and n. 1 (1968). In the proceedings before the ICC, Mt. Hood opposed four of those acquisitions,* alleging that, if the acquisitions were approved, Greyhound could route traffic around Mt. Hood's operations and thereby deprive the public of the most convenient service and jeopardize Mt. Hood's continued existence."

Greyhound successfully contended, however, that the acquisitions were not intended to, and would not, have such consequences. Greyhound represented to the ICC that the acquisitions

"would not adversely affect connecting carriers; that arrangements with such carriers, including interchange of traffic and open gateways, would be maintained; that it was not the policy of Greyhound to route passengers over circuitous routes; that its agents were instructed to quote the direct route as well as the Greyhound route and give passengers their choice; and that Greyhound had always

"Greyhound." The formal transfer of rights and properties at the end of 1963 has no significance for purposes of this litigation.

Mt. Hood, however, withdrew its opposition to one of these. See id., at 452.

5 See 555 F. 2d 687, 689 (CA9 1977).

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carried MH's schedules in its folders and cooperated in every way to acquaint the public with its service and thus promote additional traffic and business for their lines." " Greyhound also represented to the Commission that it would continue the joint through-bus arrangement with Mt. Hood.' As Greyhound had anticipated, the ICC relied on these representations in determining that the proposed acquisitions were in the public interest. Id., at 454–457, 461.

In July 1964, Greyhound terminated the through-bus arrangement with Mt. Hood. On October 7 of that year, Mt. Hood filed a petition with the Commission, pursuant to § 5 (10) (formerly § 5 (9)) of the Interstate Commerce Act, alleging that Greyhound had not lived up to various representations it had made to the ICC and asking the Commission to reopen the acquisition proceedings "for further hearing to consider the necessity of attaching certain terms, conditions and limitations to the privileges therein granted" or, in the alternative, to order Greyhound to divest itself of operations acquired in those proceedings. App. 4. The allegations in Mt. Hood's petition to the Commission were essentially the same as those Mt. Hood made later in this antitrust suit, that

This quoted material is from the opinion in the subsequent ICC proceeding instituted by Mt. Hood to reopen the eight acquisition proceedings. Mt. Hood Stages, Inc., 104 M. C. C., at 452. Greyhound's representations in those eight proceedings were so summarized.

"This arrangement, initiated in 1949, provided for a through bus from San Francisco to Spokane, using Mt. Hood's bridge route between Klamath Falls and Biggs. The route was shorter by 110 miles and several hours than the all-Greyhound route via Portland. It provided better service to travelers and was profitable for both companies. 555 F. 2d, at 689 n. 3.

8 Section 5 (10) of the Interstate Commerce Act, as amended, 90 Stat. 63, 66, 49 U. S. C. § 5 (10) (1976 ed.), provides:

"The Commission may from time to time, for good cause shown, make such orders, supplemental to any order made under paragraph (1), (2), or (8), of this section, as it may deem necessary or appropriate."

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