Opinion
This matter coming on to be heard on the motion of defendant, Anchor Serum Company, a corporation, filed October 14, 1940, to quash and set aside the summons issued upon the complaint of the plaintiff in the above entitled action against said defendant and the service of the writ of summons on said defendant and the return of the Marshal of the service of the writ of summons upon said defendant:
From the bill of complaint and from the affidavits filed in support of and in opposition to said motion to quash the summons, the service thereof and the return of the Marshal thereon, and having considered written briefs and arguments filed by the respective parties, the Court now makes the following
Findings of Fact
(1) On September 13, 1940, the plaintiff filed its complaint against the defendant, Anchor Serum Company and others, which complaint is hereby incorporated in and made a part of these findings of fact.
(2) Upon the filing of said complaint a summons was issued directed to the United States Marshal for the Western District of Missouri for service and, under date of September 24, 1940, the said United States Marshal made the following return: 'I hereby certify and return, that on the 16th. day of September, 1940, I received the within summons and complaint and I executed this writ by delivering a true copy of Summons together with a copy of Complaint to each of the within-named defendants; Anchor Serum Company, a corp., by serving W. J. Kennedy, Vice President and to W. J. Kennedy, individually and to True Davis all at the Exchange Building, South Saint Joseph, Missouri. All done in the St. Joseph Division of the Western District of Missouri.'
(3) The defendant, Anchor Serum Company is a corporation existing under and by virtue of the laws of the State of Missouri, and is a resident and citizen of no other state. The defendant was not found and no agent, servant or representative of it was found and no service was had upon said defendant within the geographical limits of the United States District Court for the Northern District of Illinois, or within the State of Illinois.
(4) For many years last past said defendant was and now is engaged in the manufacture and sale of anti-hog cholera serum and virus and other animal vaccines, and never was and is not now engaged in any other business. At all said times its manufacturing plant and warehouses were and are located in South St. Joseph, Missouri, where all of the serum, virus and animal vaccines manufactured and sold by it are kept and stored until shipped to purchasers, except that it had warehouses in Indiana and Iowa.
(5) The defendant, Anchor Serum Company, since 1936, has contracted with the co-defendants residing in the State of Illinois, whereby the defendant, Anchor Serum Company, is to supply the said Illinois defendants with all of the serum and virus which they can use or can distribute in the State of Illinois, the last of which contracts cover the period from September 1, 1940 to February 28, 1942. Said contracts were made and executed in the City of Chicago, Illinois, where the Illinois defendants have their home offices, and such contracts do not, on their face, require acceptance at the home office of defendant, Anchor Serum Company.
(6) The contract covering the period from September 1, 1940 to February 28, 1942, calls for the sale and delivery of a minimum of 45,000,000 cc of concentrated anti-hog cholera serum at .36 cents per 100 cc.
(7) Under the contracts hereinabove referred to, the defendant, Anchor Serum Company, has been delivered annually approximately 44,000,000 cc of serum in Illinois which, according to the original contract, amounts to a gross sale of approximately $215,000, such amount being between one-third and one-half of the total production of the defendant, Anchor Serum Company.
(8) The Fidelity Laboratories, Inc., is an Illinois corporation with its principal office in Chicago, Illinois. Its business is that of the manufacture and sale of anti-hog cholera serum and virus. The defendant, Anchor Serum Company, owns and controls fifty percent of the common stock of the said Fidelity Laboratories, Inc. and, in addition, owns some of its preferred stock.
(9) A verbal agreement between the officers of the defendant, Anchor Serum Company, and Fidelity Laboratories, Inc., made either in Chicago, Illinois, or while the said agents were traveling into Chicago enroute from Washington, D.C., in the year 1938, whereby the said Fidelity Laboratories, Inc. would sell to the defendant, Anchor Serum Company, sufficient quantities of serum to take care of the needs of Kankakee, Sangamon, Mercer, Hancock and Cook Counties, Illinois. Pursuant to said contract the defendant, Anchor Serum Company, during 1939, purchased 4,625,375 cc of anti-hog cholera serum and 389,490 cc of hog cholera virus and delivered by the Fidelity Laboratories, Inc., to various counties of Illinois, which said serum and virus were billed to and paid for by the defendant, Anchor Serum Company.
(10) The defendant, Anchor Serum Company, has, for the last twelve years, employed and compensated a Doctor of Veterinary Medicine within the State of Illinois. The function of the Doctor of Veterinary Medicine so employed and so compensated is to take care of what is known as 'trouble cases' in the industry. These are cases where sickness develops in a herd after vaccination and the duties of this Doctor encompassed examination of herds which became sick after vaccination with Anchor Serum. The duties of this Doctor further require that he make reports in triplicate, with a copy to the Illinois defendants, a copy to the county unit of Illinois and a copy to the defendant, Anchor Serum Company.
(11) On March 25, 1938, at Chicago, Illinois, the defendant, Anchor Serum Company, entered into a contract with the defendant, Illinois Farm Bureau Serum Association, whereby it is recited that the parties are desirous of obtaining a wide distribution of serum and that the said Illinois defendants are ready and willing to carry on a publicity program, including advertising in a state-wide paper of general publication, in order to obtain such larger distribution, and reciting that the defendant, Anchor Serum Company, is ready and willing to compensate the Illinois defendants for the purpose of getting such wider distribution, and agreeing that the Illinois defendants, through the use of all proper publicity means, shall endeavor to extend the use of serum and virus and agreeing that the defendant, Anchor Serum Company, shall pay the Illinois defendants for such educational, promotional and publicity obligations of the Illinois defendants.
Upon the above and foregoing findings of fact, the Court states the following
Conclusions of Law
(1) Process was properly served on the defendant, Anchor Serum Company, in the State of Missouri.
(2) The defendant, Anchor Serum Company, was transacting business within the geographical limits of the District Court of the United States for the Northern District of Illinois and within the State of Illinois within the meaning of Section 12 of the Clayton Act, 15 U.S.C.A. § 22. Eastman Kodak Co. v. Southern Photo Materials Co., 273 U.S. 359, 47 S.Ct. 400, 71 L.Ed. 684.
(3) The motion of defendant, Anchor Serum Company, to quash the summons, its service and return, should be overruled. Neal J. Huff, of Chicago, Ill., for plaintiff.
Ben Phillip, of St. Joseph, Mo., and Myers & Snerly, of Chicago, Ill., for defendant Anchor Serum Co.
WOODWARD, District Judge.
The Court is filing findings of fact and conclusions of law on the motion of defendant, Anchor Serum Company, filed October 14, 1940, to quash the summons, its service and return. The Court has entered an order pursuant to its findings and conclusions overruling the motion.
By its motion and by voluminous affidavits and typewritten arguments in support of its motion, the defendant, Anchor Serum Company, has challenged not only the summons, its service and return but has challenged and argued the merits of plaintiff's case. In fact, most of the affidavits and the argument of the defendant, Anchor Serum Company, relates to the merits and not to the very narrow question of whether or not the summons was properly issued, served and returned. The record in this case is very confusing. Motions and counter-motions to strike papers and documents filed have been made. The Court will not rule on the several motions to strike. From the affidavits and other papers on file the Court has considered only such facts are are pertinent to the motion to quash and has ignored all facts and arguments which go to the merits of the controversy.
In view of the scope of the motion to quash, the affidavits and arguments filed in support thereof, the Court would have been justified in treating the motion as a general appearance in the action. The Court would also have been justified in overruling pro forma the motion to quash. However, the Court has considered the substance of the motion as made together with the affidavits and arguments filed as a motion to dismiss plaintiff's complaint and is entering an order today overruling the motion to dismiss the complaint and ordering the defendant, Anchor Serum Company, to serve its answer on or before May 19, 1941.
The complaint discloses that this is an action brought under Section 4 of the Clayton Act, 15 U.S.C.A. § 15, to recover treble damages arising out of an alleged violation of Section 2 of the Clayton Act as amended by the Act of June 19, 1936, 15 U.S.C.A. § 13. The plaintiff, bona fide and by apt averment, alleges that it was injured in its business or property by reason of acts done by the defendant in violation of the anti-trust laws.
The District Court has jurisdiction of the subject matter. 15 U.S.C.A. § 15. In the case of Flanders v. Coleman, 250 U.S. 223, 227, 39 S.Ct. 472, 473, 63 L.Ed. 948, the Court say: 'Whether the District Court has jurisdiction to grant any relief must be determined upon a consideration of the allegations of the bill and the amendment thereto. If there be enough of substance in them to require the court to hear and determine the cause, then jurisdiction should have been entertained. ' And on page 228 of the same case in 250 U.S.,on page 474 of 39 S.Ct., 63 L.Ed. 948, the Court say: 'As this court has not infrequently said, jurisdiction must be determined not upon the conclusion on the merits of the action, but upon consideration of the grounds upon which federal jurisdiction is invoked.'
"Jurisdiction' may be defined to be the right to adjudicate concerning the subjectmatter in the given cause. ' Reynolds v. Stockton, 140 U.S. 254, 258, 11 S.Ct. 773, 777, 35 L.Ed. 464.
The real test of jurisdiction is whether the Court has power to enter upon the inquiry. The averments of the complaint disclose that there is really and substantially involved a dispute or controversy over which this court has jurisdiction. The subject matter in controversy is plaintiff's claim for treble damages arising out of an alleged violation of the anti-trust act. Whether the plaintiff may successfully maintain its action is not pertinent to the question now before the court. 'Unsuccessful as well as successful suits may be brought' in a federal court. The Fair v. Kohler Die Co., 228 U.S. 22, 33 S.Ct. 410, 411, 57 L.Ed. 716. The ultimate outcome of the suit is not the test of jurisdiction. Plaintiff, by the averments of its complaint, has stated a case which is within the power and authority of this court to hear and determine.
The Court has jurisdiction both of the subject matter of the cause and of the person of the defendant and may proceed to adjudicate the cause on its merits.