RUTLEDGE, J., dissenting. 333 U.S. can leave no doubt that its purpose was to withhold from every interstate rail carrier the inducement and facility for favoritism and abuse of its powers as a common carrier, which experience had shown are likely to occur when a single business interest occupies the inconsistent position of carrier and shipper. See United States v. Reading Co., 253 U. S. 26, 60, 61. Before the enactment of the commodities clause, Congress, by sweeping prohibitions, had made unlawful every form of rebate to shippers and every form of discrimination in carrier rates, service and facilities, injurious to shippers or the public. By the Sherman Act it had forbidden combinations in restraint of interstate commerce. But it did not stop there. The commodities clause was aimed, not at the practices of railroads already penalized, but at the suppression of the power and the favorable opportunity, inseparable from actual control of both shipper and carrier by the same interest, to engage in practices already forbidden and others inimical to the performance of carrier duties to the public. See Delaware, L. & W. R. Co. v. United States, 231 U. S. 363, 370; United States v. Reading Co., supra." 298 U. S. at 504.1 In my opinion this expresses the intent of the letter and the policy of the commodities clause, and we should now return to it on our own responsibility. Congress should not again be required to reenact what it has once provided for, only to have its mandate nullified in part by this Court's misconstruction. 17 See also note 4. Syllabus. UNITED STATES v. SCOPHONY CORPORATION OF AMERICA ET AL. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK. No. 41. Argued January 12-13, 1948.-Decided April 26, 1948. A British corporation with its principal place of business in London engaged in the Southern District of New York in various but continuing efforts to conserve and exploit its television inventions and patents. This was done through a series of complex contractual arrangements made with certain American corporations and involved the British company's constant intervention and supervision. The company was represented in the New York district by two of its directors, one of whom held a comprehensive power of attorney to protect its interests in the United States. Held: The company was "transacting business" and was "found" in the Southern District of New York, within the meaning of § 12 of the Clayton Act, so that it could be sued and served there in a civil proceeding charging violations of §§ 1 and 2 of the Sherman Act. Pp. 796-818. (a) The venue provision of § 12 of the Clayton Act permitting suit in any district wherein a corporation "transacts business" is met by the carrying on of business "of any substantial character." Practical, nontechnical business or commercial standards are to be applied in determining whether the requirement is satisfied. P. 810. (b) Section 12 of the Clayton Act is not to be construed in a manner to bring back the obstacles to enforcement of antitrust policies and remedies which it was enacted to eliminate. In this case, the determination whether the British corporation was "found" within the Southern District of New York so that it could be served there is not to be made by atomizing the enterprise into minute parts or events, in disregard of the unity and continuity of the whole course of conduct. P. 817. 69 F. Supp. 666, reversed. In a civil proceeding brought in the Southern District of New York under § 12 of the Clayton Act and charging violations of §§ 1 and 2 of the Sherman Act, the District Opinion of the Court. 333 U.S. Court quashed service of process and dismissed the complaint as to a British corporation having its principal place of business in London. 69 F. Supp. 666. On direct appeal to this Court, reversed and remanded, p. 818. Sigmund Timberg argued the cause for the United States. With him on the brief were Solicitor General Perlman, Assistant Attorney General Sonnett, Charles H. Weston and Robert L. Stern. Edwin Foster Blair argued the cause and filed a brief for Scophony, Ltd., appellee. MR. JUSTICE RUTLEDGE delivered the opinion of the Court. The appellee Scophony, Limited is a British corporation which has its offices and principal place of business in London, England. The question is whether that company "transacted business" and was "found" within the Southern District of New York under § 12 of the Clayton Act, so that it could be sued and served there in a civil proceeding charging violation of §§ 1 and 2 of the Sherman Act. 26 Stat. 209, 50 Stat. 693, 15 U. S. C. §§ 1, 2. The violations stated were that Scophony and the other defendants had monopolized, attempted to monopolize, and conspired to restrain and monopolize interstate and 1"SEC. 12. That any suit, action, or proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found." 38 Stat. 736, 15 U. S. C. § 22. 2 The suit was instituted against Scophony, Limited (designated in this opinion as "Scophony"), Scophony Corporation of America (designated "American Scophony"), General Precision Equipment Corporation (designated "General Precision"), Television Produc 795 3 Opinion of the Court. foreign commerce in products, patents and inventions useful in television and allied industries. The cause is here on direct appeal from an order of the District Court granting Scophony's motion to quash the service of process and dismiss the complaint as to it. 69 F. Supp. 666. Scophony manufactures and sells television apparatus and is the owner and licensor of inventions and patents covering television reception and transmission.* With the outbreak of the European War in 1939, the British Broadcasting Corporation stopped television broadcasting. Consequently it became impossible for Scophony to continue in the commercial development, manufacture and sale of television equipment in England. It therefore sent personnel to the United States, opened an office in New York City, and began demonstrations of its product and other activities preliminary to establishing a manufacturing and selling business in this country. Late in 1941 Scophony found itself in financial distress, in part because of restrictions imposed by the British Government on the export of currency. It became imperative that new capital from American sources be found for the enterprise. Accordingly, Arthur Levey, a director tions, Inc. (designated "Productions"), Paramount Pictures, Inc. (designated "Paramount"), and three individual defendants, Arthur Levey and the presidents of General Precision and Productions. The corporations, except Scophony, are incorporated in the United States. 3 Pursuant to § 2 of the Expediting Act of February 11, 1903, 32 Stat. 823, 15 U. S. C. § 29, and § 238 of the Judicial Code, 43 Stat. 938, 28 U.S. C. § 345. * The inventions and patents in the main relate to two systems of television transmission and reception, one known as the "supersonic" system and the other as the "skiatron" system. We shall at times refer to the present and future patents, processes, designs, technical data, etc., relating to these two systems as the Scophony inventions. A third system, the cathode-fluorescent system, was developed early in this century and is the principal method of television transmission and reception used in the United States today. Opinion of the Court. 333 U.S. of Scophony and one of its founders, undertook negotiations in New York with American motion picture and television interests, including Paramount and General Precision. They culminated in the execution of three interlacing contracts, the so-called master agreement of July 31, 1942, and two supplemental agreements of August 11, 1942. Copies of the latter had been attached to the master agreement, which provided for their later execution, and they when executed in effect carried out its terms. The alleged violations of the Sherman Act center around these agreements. The master agreement was executed by Scophony, William George Elcock, as mortgagee of all of Scophony's assets. General Precision, and Productions, the latter a wholly owned subsidiary of Paramount. It provided for the formation of a new Delaware corporation, American Scophony, with an authorized capital stock of 1,000 Class "A" shares and a like number of Class "B" shares. Scophony and individuals interested in it were to be given the Class "A" shares. Under the agreement, ownership of those shares conferred the right to elect three of American Scophony's five directors and its president, vice president and treasurer. The Class "B" shares were allotted to General Precision and Productions. By virtue of such ownership those two corporations were entitled to name the remaining two directors and the secretary and assistant secretary of American Scophony. Levey was named in the agreement as the president and a director of the new corporation. The master agreement set forth the general desire of the parties to promote the utilization of the Scophony inventions "particularly in the United States of America 5 An agreement of February 4, 1943, amended the original agreement so as to give two-thirds of the "A" shares to Scophony, the remainder to individuals. |