Anti-Trust Enforcement Through Consent Decrees

December 19, 1938

Report Outline
New Procedure in Anti-Trust Prosecutions
Enforcement of Anti-Trust Laws, 1917-1932
Court Decisions on Use of Consent Decrees
Concurrent Use of Criminal and Civil Action

New Procedure in Anti-Trust Prosecutions

With Approval last month by a federal court of two consent decrees entered into by the Department of Justice with the Ford Motor Company and the Chrysler Corporation respecting the relations of the two concerns with affiliated automobile finance companies, enforcement of federal anti-trust laws entered upon a new phase. In prosecuting these cases, the Department employed a new type of procedure which officials believe provides a means by which the anti-trust laws may be vitalized and the government's prosecution policy made consistent and understandable to the interests it affects.

The new procedure has three principal features: (1) Concurrent use of criminal and civil proceedings; (2) entry of consent decrees not only enjoining allegedly illegal conduct but detailing what may legally be done; and (3) issuance by the department of public statements setting forth reasons for the action taken in each case, in order (a) to provide a guide and warning for businessmen, (b) to aid the Department itself in formulating a consistent policy of anti-trust law enforcement, (c) to direct the attention of Congress to needed amendments to existing anti-trust legislation.

Settlement of Auto Finance Cases by Consent Decree

Initial legal action against the Ford and Chrysler companies and against the General Motors Corporation was taken in September, 1937, when the Justice Department presented evidence before a federal grand jury in Milwaukee relating to violations of the anti-trust laws by these companies and three finance companies associated with them. Before the grand jury could return criminal indictments, however, it was dismissed by District Judge Ferdinand A. Geiger because the Department, during a recess of the grand jury, had entered into negotiations with representatives of the companies for settlement of the case by means of consent decrees in equity. Under the terms of the proposed decrees, the companies were to discontinue the allegedly illegal practices and to substitute practices approved by the Department and by the court, while the Department was to nolle prosse the indictments, “I thought it highly improper for the parties to get together during the period when the grand jury was in recess,” Judge Geiger said in his ruling. “There is nothing for the court to do but to dismiss the grand jury

ISSUE TRACKER for Related Reports
Antitrust
Jun. 12, 1998  Antitrust Policy
Jul. 07, 1989  Do Antitrust Laws Limit U.S. Competitiveness?
Jan. 15, 1982  Business Mergers and Antitrust
Jan. 31, 1975  Antitrust Action
May 25, 1966  Business Concentration and Antitrust Laws
Feb. 19, 1947  Enforcement of the Antitrust Laws
Dec. 19, 1938  Anti-Trust Enforcement Through Consent Decrees
Nov. 24, 1930  Revision of the Antitrust Laws
BROWSE RELATED TOPICS:
Antitrust and Monopolies
Antitrust and Monopolies