IN RE: General Aircraft Corporation Antitrust/Tort Claims Act Litigation

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JUDICIAL PANEL ON EE
. BEFORE THE JUDICIAL PANEL MULTIGISTRICT LITIGATION SR
ON FILED a
MULTIDISTRICT LITIGATION MAY	11 1978 } Lo
IN RE GENERAL AIRCRAFT CORPORATION ) DOGKEERING: 344i trp aANTITRUST/TORT CLAIMS ACT LITIGATION) te baie :
OPINION AND ORDER
BEFORE JOHN MINOR WISDOM, CHARIMAN, AND EDWARD WEINFELD, :
EDWIN A. ROBSON, JOSEPH S. LORD, III, STANLEY A. WEIGEL, RE
ANDREW A. CAFFREY, AND ROY W. HARPER, JUDGES OF THE PANEL. CL
PER CURIAM 2
This litigation consists of two actions, one in the |
District of the District of Columbia and one in the Eastern
District of Virginia. B oo
Both actions arise from the same general factual oo
allegations. General Aircraft Corporation (GAC), the | -
plaintiff in both actions, states that during a twenty year -
period from 1955 to 1975 it was the manufacturer of two oo
short take off and landing (''STOL") type aircraft. GAC
alleges that it was the victim of a vendetta conducted by .
officers of the Central Intelligence Agency (CIA), CIA oo _
proprietariesl/ and private defendants to drive GAC out RE
of the STOL business. GAC alleges that this vendetta oo
stemmed from GAC's refusal to conduct its STOL sales under
the auspices of a CIA proprietary, Air America, Inc. (Air oo
Americal. |
T/Aproprietary	1s a business entirely owned or operated
by the CIA which either actually does business as a private
firm or appears to do business under commercial guise.

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- oe = i
More specifically, GAC alleges that Air America; its oo .
CT subsidiary,	Air Asia Company, Ltd. (Air Asia); and their a
former chief executive officer, George A. Doole, Jr.
(Doole), used the extensive power of these two air pro-
prietaries to obtain the agreement of two private companies, SEE
Continental Air Services (CAS) and Bird & Sons, Inc. (Bird), oo
not to purchase GAC's STOL aircraft. Instead, GAC alleges, -
the two private companies agreed to buy STOL aircraft manu-
factured by Fairchild Industries, Inc. (Fairchild). -
Additionally, GAC alleges that without authorization from Tee
GAC, Air Asia illegally obtained GAC engineering documents N -
and manufactured at Air Asia's Taiwan facilities complete
STOL aircraft and inferior replacement parts which Air : SE
Asia passed off as GAC products. GAC also alleges that SE
Air America and Doole deliberately and without foundation ht
disparaged GAC's STOL aircraft and caused GAC to lose so -
many sales in Nepal, the Phillipines, Greece and other B :
countries that GAC was finally forced to discontinue B Fa
production of STOL aircraft. Finally, GAC alleges that CIA BREE
agents held themselves out as GAC employees as a cover for oo
their operations in the Far East, that this was without ~
permission from GAC, and that GAC suffered losses when
pctential customers concluded that GAC was a front for the E =
CIA. |

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® The District of Columbia action is brought against,
inter alia, Ajir America, Air Asia, Doole, Bird,
CAS and Fairchild. GAC charges that all defendants engaged
in a conspriacy to boycott and disparage GAC's products
in violation of Sections 1 and 2 of the Sherman Act.
GAC has brought the Virginia action against the United
States under the Tort Claims Act, alleging that the United
States tortiously interfered with GAC's contractual
relations.
Air America, Air Asia and Doole move the Panel,
pursuant to 28 U.S.C.§ 1407, for transfer of the Virginia
C action to the District of the District of Columbia for |coordinated or consolidated pretrial proceedings with the
action pending there. Bird, Fairchild and the United States
support the motion to transfer. GAC, at the hearing before
the Panel on this matter, acknowledged the advantages of
transfer, but urges that the Eastern District of Virginia
is the more appropriate transferee forum.
We find that these two actions involve common questions
of fact and that transfer under Section 1407 of the
Virginia action to the District of the District of
Columbia for coordinated or consolidated pretrial pro-
ceedings with the action pending there will best serve the
convenience of the parties and witnesses and promote the
® just and efficient conduct of this litigation.

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®
As all parties to this litigation recognize, both
actions share complex factual questicns concerning defen-
dants' conduct over a twenty year period, notwithstanding
the presence of different legal theories of liability. These
complex common factual questions relate to the alleged CIA
vendetta, the alleged disparagement of GAC's STOL aircraft
by the CIA, the alleged use of unauthorized ''cover'' by CIA
agents, the alleged promotion of Fairchild's STOL aircraft
by the CIA and Doole, and the reasons why various foreign
governments allegedly declined to deal with GAC. Additionally,
threshold factual questions involving the relevant statute
of limitations and concomitant allegations of fraudulent ®	concealment are common to both actions. Transfer under
Section 1407 is thus necessary, even though only two actions —
are involved, in order to avoid duplication of time-consuming
discovery, eliminate the possibility of inconsistent pre-
trial rulings, and otherwise conserve the efforts of the
parties, the witnesses and the judiciary. We note that
the courthouses where the two actions are now pending are
but a few miles apart and that no party will be subjected
to any significant inconvenience as a result of transfer.
See generally In re Scotch Whiskey Antitrust Litigation,
299 F.Supp 543, 544 (J.P.M.L. 1969).
Either the District of the District of Columbia or
the Eastern District of Virginia could be characterized Cas an appropriate transferee forum for this litigation.

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®
Pretrial proceedings are advancing at the same pace in both
districts, and each district is conveniently located with
respect to the whereabouts of the parties, their anticipated
witnesses and relevant documents. On balance, however,
we are persuaded that the District of the District of
Columbia is the preferable transferee forum. That district
is the choice of the majority of the parties, see In re
Sugar Industry Antitrust Litigation, 395 F. Supp. 1271,
1274 (J.P.M.L. 1975); all depositions thus far noticed in
the two actions have been noticed there; and many of the
acts allegedly perpetrated by several of the defendants
® are alleged to have occurred there.
IT IS THEREFORE ORDERED that, pursuant to 238 U.S.C.
§ 1407, the action listed on the following Schedule A and
pending in the Eastern District of Virginia be, and the
same hereby is, transferred to the District of the District
of Columbia and, with the consent of that court, assigned
to the Honorable June L. Green for coordinated or consoli-
dated pretrial proceedings with the action listed on
Schedule A and pending in that district.
® :

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DOCKET NO. 344 -— IN RE GENERAL AIRCRAFT CORP. ANTITRUST/ )TT TORTS CLAIM ACT LITIGATION
SCHEDULE A
DISTRICT OF THE DISTRICT OF COLUMBIA
General Aircraft Corp. v. Air America, Civil Action
et al. No. 77-1926
EASTERN DISTRICT OF VIRGINIA
General Aircraft Corp. v. U.S.A. Civil Action
No. 77-829A