Appeal From the United States District Court for the Western District of Pennsylvania
Before Adams, Hunter and Weis, Circuit Judges.
The appellants, United States Gypsum Co. (USG), National Gypsum Co. (National), Georgia-Pacific Corp. (G-P), and The Celotex Corp. (Celotex), appeal from the denial of their consolidated motion for judgments of acquittal on the ground of insufficiency of the evidence to support the convictions. They contend that the district court should have granted their motion and, on the authority of Burks v. United States, 437 U.S. 1, 98 S. Ct. 2141, 57 L. Ed. 2d 1 (1978), should have held that retrial was barred by the double jeopardy clause. Finding sufficient evidence, we affirm.
On December 27, 1973 appellants were indicted, along with two other companies and ten individuals not before us, for violating section 1 of the Sherman Act, 15 U.S.C. § 1 (1976). They are alleged to have engaged in a nationwide conspiracy to fix the prices, the terms and conditions of sale, and the methods of handling gypsum board products. The Government charged that the conspiracy began some time prior to 1960 and continued until the indictment was returned. The indictment listed thirteen means by which the conspiracy was allegedly effected, the most pervasive of which was price verification. Appellants were convicted after a nineteen week trial, and appealed to this court. We reversed the appellants' convictions, though without ruling on the sufficiency of the evidence. 550 F.2d 115 (3d Cir. 1977). The Government appealed to the United States Supreme Court, which affirmed this court's judgment. 438 U.S. 422, 98 S. Ct. 2864, 57 L. Ed. 2d 854 (1978). The case was remanded to the district court for a new trial.
On remand appellants moved for judgments of acquittal, contending that the evidence introduced at the first trial was insufficient to support the convictions. Their motion was denied on September 7, 1978. Because appellants' original conviction on the charges involved here was reversed on appeal, if the defendants are correct that the evidence tendered at the first trial was insufficient to support a conviction, retrial would subject them to double jeopardy. Burks v. United States, 437 U.S. 1, 98 S. Ct. 2141, 57 L. Ed. 2d 1 (1978). Consequently, they may appeal the denial of their motion at this juncture, under the "collateral order" exception to the final judgment rule. See Abney v. United States, 431 U.S. 651, 97 S. Ct. 2034, 52 L. Ed. 2d 651 (1977).
In reviewing the denial of a motion for judgment of acquittal on the ground of insufficiency of the evidence to support a conviction, we must sustain the verdict if there is substantial evidence, viewed in the light most favorable to the Government, to uphold the jury's decision.*fn1 Burks v. United States, 437 U.S. 1, 17, 98 S. Ct. 2141, 57 L. Ed. 2d 1 (1978); Glasser v. United States, 315 U.S. 60, 80, 62 S. Ct. 457, 86 L. Ed. 680 (1942). Moreover, we are aware that "the character and effect of a conspiracy (is) not to be judged by dismembering it and viewing its separate parts, but only by looking at it as a whole." United States v. Patten, 226 U.S. 525, 544, 33 S. Ct. 141, 145, 57 L. Ed. 333 (1913).
The appellants primarily contend that there was presented insufficient evidence of conspiracy in the statutory period to support the conviction, particularly given what they describe as intense price competition beginning immediately prior to the statutory period.*fn2 We focus our attention on that argument.
The gist of the crime of conspiracy to violate the Sherman Act is the agreement itself. United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 252, 60 S. Ct. 811, 84 L. Ed. 1129 (1940). No overt acts need be alleged or proved: "(I)t does not make the doing of any act other than the act of conspiring a condition of liability." Nash v. United States, 229 U.S. 373, 378, 33 S. Ct. 780, 57 L. Ed. 1232 (1913). To determine whether the conspiracy is a continuing one, we must look to the scope of the agreement allegedly entered into by the parties. Fiswick v. United States, 329 U.S. 211, 216, 67 S. Ct. 224, 91 L. Ed. 196 (1946). See Grunewald v. United States, 353 U.S. 391, 397, 77 S. Ct. 963, 1 L. Ed. 2d 931 (1957). The Supreme Court in United States v. Kissel, 218 U.S. 601, 607, 31 S. Ct. 124, 54 L. Ed. 1168 (1910), defined a continuous conspiracy as one that "contemplates bringing to pass a continuous result that will not continue without the continuous cooperation of the conspirators to keep it up." The conspiracy charged here, to maintain high and stable prices, certainly fits that test.
The appellants would have us hold that the Government is limited in the proof of its case solely to those events which occurred during the statutory period. In the context of a continuing conspiracy, we do not believe that the Government is so limited. When the conspiracy is alleged to have been formed prior to the statutory period, the issue becomes one of continuation. We agree with the Second Circuit that "the Government must present evidence justifying the jury in finding beyond a reasonable doubt that the particular agreement into which a defendant entered continued into the period not barred by limitation." United States v. Borelli, 336 F.2d 376, 385 (2d Cir. 1964), Cert. denied, 379 U.S. 960, 85 S. Ct. 647, 13 L. Ed. 2d 555 (1965). There is no requirement that the Government prove a new agreement in the statutory period. United States v. Kissel, 218 U.S. 601, 31 S. Ct. 124, 54 L. Ed. 1168 (1910). Moreover, the "overt act of one partner may be the act of all without any new agreement specifically directed to that act." Id. at 608, 31 S. Ct. at 126. See United States v. Nowak, 448 F.2d 134, 139 (7th Cir. 1971). This court discussed the utility of pre-statutory period evidence to prove a conspiracy in United States v. Johnson, 165 F.2d 42 (3d Cir. 1947), Cert. denied, 332 U.S. 852, 68 S. Ct. 355, 92 L. Ed. 421 (1948). There, the defendants were charged under 18 U.S.C. § 371 (1976) with conspiracy to obstruct the administration of justice. In finding sufficient evidence to support the conviction we held: "Some of the acts necessarily occurred (prior to the statutory period), but these acts could be proved to show the existence and continuance of the conspiracy even though there could have been no prosecution for any substantive offense charged as an overt act." Id. at 45.
Here, we find sufficient acts in furtherance of the conspiracy committed in the statutory period to justify a jury in concluding that the agreement continued therein. The Government's proof of conspiracy rested heavily on the practice of price verification. The defendants' own recitation of the facts reveals various incidents of price verification in the statutory period. See Appellants Brief at 34-41. The testimony discloses that Kenneth H. Atwell and Charles D. Webster, Vice President and Administrative Assistant respectively of National Sales Administration, engaged in numerous verification contacts after December 27, 1968. These apparently involved both price and credit term verifications. Also, the management of G-P did not instruct its branch managers to discontinue verification until February, 1969. Certainly, the jury could infer that the conspiracy continued until that time. Moreover, O. E. Burch, General Sales Manager of G-P, had numerous contacts with competitors between June 1969 and 1972. The testimony also discloses that Celotex continued verifying until 1973.*fn3
Finally, the appellants attempt to show abandonment of the conspiracy by demonstrating that the gypsum board industry was experiencing intensive price competition beginning in 1967. They argue that the resumed price competition proves as a matter of law that they had abandoned any anticompetitive conspiracy at least two years prior to the statutory period. The Supreme Court in United States v. Container Corp., 393 U.S. 333, 89 S. Ct. 510, 21 L. Ed. 2d 526 (1969), pointed out, however, that "(t)he continuation of some price competition is not fatal to the Government's case. The limitation or reduction of price competition brings the case within the ban . . . ." Id. at 337, 89 S. Ct. at 512, Citing United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 224 & n. 59, 60 S. Ct. 811, 84 L. Ed. 1129 (1940). Moreover, the Government contends that the stepped-up price competition did not commence until at least 1970. While not presenting expert testimony of its own, the Government pointed to shortcomings in the testimony of the defendants' expert which would justify the jury in rejecting it.
Therefore, we find sufficient evidence from which the jury could have concluded that the conspiracy ...