325 U.S.

212
65 S.Ct. 1130
89 L.Ed. 1566

DE BEERS CONSOL. MINES, Limited, et al.

v.
UNITED STATES. SOCIETE INTERNATIONALE
FORESTIERE ET MINIERE DU CONGO et al. v. SAME.
Nos. 1189, 1190.
Argued May 2, 1945.
Decided May 21, 1945.

[Syllabus from pages 212-214 intentionally omitted]

Mr. Wm. D. Whitney, of New York City, for petitioners De Beers Consol.
Mines and others.
Mr. John M. Harlan, of New York City, for petitioners Societe
Internationale Forestiere et Miniere du Congo and another.
Mr. Herbert A. Berman, Sp. Asst. to Atty. Gen., for respondent.
Mr. Justice ROBERTS delivered the opinion of the Court.

These cases come before the court on petitions for certiorari presented pursuant
to 262 of the Judicial Code.1 Each petition is by several of the defendants in a
single suit pending in the District Court.

Two matters are presented: the propriety of review of the action below by
certiorari, and the alleged excess of jurisdiction by the court below in making
the order of which the petitioners complain. An understanding of the issues
requires a statement of the nature of the suit and of the order made.

The United States filed a complaint in the District Court against the three
petitioners in No. 1189, which are corporations organized under the laws of
South Africa; the petitioners in No. 1190, which are respectively corporations
organized under the laws of the Belgian Congo and under the laws of Portugal;

and four other corporations, one organized under the laws of Belgium, one
under the laws of the Belgian Congo, and two under the laws of the United
Kingdom of Great Britain and Northern Ireland, and seven individuals
respectively characterized as stockholder, or stockholder and director, or
stockholder and employee, or managing agent, or managing irector of one or
more of the corporations. The complaint sought equitable relief based upon a
charge that the defendants were engaged in a conspiracy to restrain and
monopolize the commerce of the United States with foreign nations in gem and
industrial diamonds, in violation of 1 and 2 of the Sherman Act2 and 73 of
the Wilson Tariff Act.3 The complaint alleged that all of the corporate
defendants were doing business within the United States.
4

With the complaint the United States filed a motion for a preliminary
injunction in which it prayed that all of the corporate defendants be restrained
from withdrawing from the country any property located in the United States,
and from selling, transferring or disposing of any property in the United States
'until such time as this Court shall have determined the issues of this case and
defendant corporations shall have complied with its orders.' The reason given in
support of the motion was:

'The injury to the United States of America from the withdrawal of said
deposits, diamonds or other property would be irreparable because
sequestration of said property is the only means of enforcing this Court's orders
or decree against said foreign corporate defendants. The principal business of
said defendants is carried on in foreign countries and they could quickly
withdraw their assets from the United States and so prevent enforcement of any
order or decree which this Court may render.'

Amongst other supporting papers was an affidavit by counsel for the United
States which stated that 'the investigation which he has made shows the foreign
corporate defendants named herein have endeavored to avoid subjecting
themselves to the jurisdiction of the courts of the United States by making their
sales abroad only and requiring customers to pay in advance for all purchases.'

There was also a motion for a restraining order without notice. The requested
restraining order was issued and served on a number of banks; one, a bank in
which de Beers had, the same day, established a credit of $59,320; others in
which Forestiere had credits of approximately $632,000. Bank credits of
petitioner Diamantes affected aggregate approximately $47,000. Both the two
last named petitioners had purchased machinery and supplies in the United
States of an approximate value of $100,000, which were covered by the
injunction. Upon a showing that as the corporate defendants were foreign

corporations and would be required to obtain information and affidavits in

support of their contention that service of process in the suit had not been made
upon them, and in support of other motions addressed to failure to state a cause
of action under the statutes, time to plead or answer was extended; and the
injunction was from time to time modified and continued. Counsel for the
petitioners, appearing specially, moved for dissolution of the injunction. The
case was heard on affidavits and oral argument, the application was denied, and
the injunction was continued in force. Thereupon the petitioners applied to this
court for certiorari under 262. That section provides in part:
8

'The Supreme Court, the circuit courts of appeals, and the district courts shall
have power to issue all writs not specifically provided for by statute, which
may be necessary for the exercise of their respective jurisdictions, and
agreeable to the usages and principles of law.'

All the petitioners attack the order as in substance a sequestration of property

beyond the power of the court and an abuse of discretion in the circumstances.
The petitioners in No. 1189 also seek a reversal on the ground that the
complaint does not state a claim cognizable by United States courts and that the
affidavits filed by these petitioners establish that the court below has no
jurisdiction over the persons of the defendants. It is obvious from the record
that these contentions are still open in the court below and that court has not yet
passed upon them. In the view we take of the case it is unnecessary for us
presently to consider them.

10

In United States Alkali Export Ass'n, Inc. et al. v. United States, and California
Alkali Export Ass'n et al. v. United States, 325 U.S. 196, 65 S.Ct. 1120, the
court has discussed the propriety of review under 262 in a suit brought under
the Anti-Trust laws where there is a substantial question whether the District
Court has jurisdiction of a suit which it has retained for trial on the merits.
What is there said applies in this instance. If the preliminary injunction here
granted, unless set aside, will stand throughout the course of the trial and for an
indefinite period after its termination, and if the order was beyond the powers
conferred upon the court, it is plain, under the decisions mentioned, that the
petitions present an appropriate case for the exercise of our jurisdiction under
262. As hereafter noted the order in question was not made to grant
interlocutory relief such as could be afforded by any final injunction, but is one
respecting a matter lying wholly outside the issues in the case; no decision of
the suit on the merits can redress any injury done by the order; and therefore
unless it can be reveiewed under 262 it can never be corrected if beyond the
power of the court below.4 When Congress withholds interlocutory reviews,
262 can, of course, not be availed of to correct a mere error in the exercise of

conceded judicial power. But when a court has no judicial power to do what it
purports to dowhen its action is not mere error but usurpation of powerthe
situation falls precisely within the allowable use of 262. We proceed,
therefore, to inquire whether the District Court is empowered to enter the order
under attack.
11

Although the Government based its motion upon the theory that the entry of the
requested injunction would amount to a sequestration of the defendants' assets,
and so argued in the court below, it has abandoned that position, because Rule
70 of the Rules of Civil Procedure,5 which permits the issue of a writ of
attachment or sequestration against the property of a disobedient party to
compel satisfaction of a judgment, is operative only after a judgment is entered.

12

The Government disclaims any benefit of Rule 64, which provides for an
attachment at the commencement of, or during the course of, an action for the
purpose of securing payment of any judgment ultimately obtained, under and in
accordance with the law of the state in which the court sits or under any
existing federal statute. It is admitted that there is no applicable federal statute
and that, under the law of New York, an attachment may issue only in an action
seeking a money judgment and will not issue in an equity suit such as the
instant one.6

13

The court below deduced the power to grant the injunction from 4 of the
Sherman Act7 and from 262 of the Judicial Code, the section under which
petitioners seek review in this court. The respondent seeks to sustain the
injunction under the same statutory provisions.

14

Section 4 of the Sherman Act confers jurisdiction on District Courts 'to prevent
and restrain violations of this act.' That jurisdiction, as we have held,8 is to be
exercised according to the general principles which govern the granting of
equitable relief. Since it confers no new or different powe than those
traditionally exercised by courts of equity, we are remitted to examination of
the practice of such courts, unless 262 has enlarged those powers. That
section empowers District Courts to issue all writs not specifically provided for
by statute which may be necessary for the exercise of their respective
jurisdictions and agreeable to the usages and principles of law. It turns out,
therefore, that we are again remitted to an inquiry as to what is the usage, and
what are the principles of equity applicable in such a case.

15

Preliminary to a discussion of the course of decision in chancery it will be well

to note exactly what is the substance of the injunction, since the name given to

the process is not determinative. In truth the purpose and effect of the
injunction is to provide security for performance of a future order which may
be entered by the court. Its issue presupposes or assumes the following things:
(1) That the court has obtained jurisdiction of the persons of the defendants; (2)
that it may be found and adjudged that the United States has stated a cause of
action in its complaint; (3) that a decree may be entered after trial on the merits
enjoining and restraining the defendants from certain future conduct; (4) that
the defendants may disobey the decree entered; (5) that a proceeding may be
instituted for contempt and will result adversely to the defendants; (6) that a
fine may be imposed; (7) that the defendants may neglect or refuse to pay the
fine; (8) that an execution issued for the collection of the fine pursuant to 18
U.S.C. 569, 18 U.S.C.A. 569, may be ineffectual to seize property or money
of the defendants in liquidation of the fine, unless the moneys and properties
covered by the injunction are held to await the event.
16

Under the Sherman Act and the Wilson Tariff Act, the District Court has no
jurisdiction in this suit to enter a money judgment. Its only power is to restrain
the future continuance of actions or conduct intended to monopolize or restrain
commerce. It, of course, has the power, pending final action in this respect, to
retrain action or conduct violative of the statute. A preliminary injunction is
always appropriate to grant intermediate relief of the same character as that
which may be granted finally. The injunction in question is not of this
character. It is not an injunction in the cause, and it deals with a matter lying
wholly outside the issues in the suit. It deals with property which in no
circumstances can be dealt with in any final injunction that may be entered. It is
not a form of seizure of property used in offending against the statute for the
property is not such as might be seized under 6 of the Sheman Act,9 or under
76 of the Wilson Act,10 and the complaint and affidavits do not purport so to
charge. This process is, and can only be, sustained as a method of providing
security for compliance with other process which conceivably may be issued
for satisfaction of a money judgment for contempt.

17

The parties agree that neither of them can find any decision or text book
authority for the requisition of such security on the footing of a complaint in
equity. The respondent refers us to certain cases as analogous but, upon
examination, they are all found to be cases in which an interlocutory injunction
was granted with respect to a fund or property which would have been the
subject of the provisions of any final decree in the cause,11 or against action
which would ultimately have been subject to injunction by final decree.12 The
Government also refers us to cases where federal courts have enjoined
interference with their jurisdiction.13 Thus it argues that a court of equity has
inherent power to protect its jurisdiction. The fallacy, in the application of the

principle here, is that, i service of the defendants is properly obtained, and if the
complaint states a cause of action, no one questions the jurisdiction of the
District Court to enter an appropriate injunction against future conduct violative
of the Anti-Trust Acts. The injunction here granted cannot aid or protect this
exercise of its powers, and is not intended to do so.
18

Federal and State courts appear consistently to have refused relief of the nature
here sought.14 The Government nevertheless urges that equity should extend its
jurisdiction for the purpose envisaged in the issue of the injunction and
advances several reasons in support of its position. It suggests that, by analogy
to the practice of issuing writs ne exeat,15 the court, if it would restrain, by such
a writ, an individual defendant in a similar case, should restrain the removal of
the property of a corporate defendant from the jurisdiction. The analogy is not a
helpful one, for the writ ne exeat would not be issued in a case of this sort
where the defendant presently owes no debt to the complainant nor is under any
fixed duty by reason of the receipt of moneys to account to the complainant
therefor.16

19

The Government urges that the supposed hardship imposed upon the
defendants by the entry of the injunction is exaggerated; that, by giving a bond,
the defendants could release their moneys and property. To this there are
several sufficient answers. If the court is without jurisdiction to demand
security under the circumstances presented it is equally without authority to
compel the proffer of a bond by the seizure of property. If the process be
justified in the present posture of the case there is nothing to prevent other and
further seizures of property or money brought into the United States in
connection with transactions unrelated to any supposed violation of the AntiTrust laws. Moreover, the very indefiniteness of the obligation, the remoteness
of any possible exoneration of the surety, and the citizenship of the defendants
would, as common experience tells us, require the posting of collateral with any
bondsman, which would, in effect, tie up assets of value equal to that of those
frozen by the injunction.

20

To sustain the challenged order would create a precedent of sweeping effect.

This suit, as we have said, is not to be distinguished from any other suit in
equity. What applies to it applies to all such. Every suitor who resorts to
chancery for any sort of relief by injunction may, n a mere statement of belief
that the defendant can easily make away with or transport his money or goods,
impose an injunction on him, indefinite in duration, disabling him to use so
much of his funds or property as the court deems necessary for security or
compliance with its possible decree. And, if so, it is difficult to see why a
plaintiff in any action for a personal judgment in tort or contract may not, also,

apply to the chancellor for a so-called injunction sequestrating his opponent's

assets pending recovery and satisfaction of a judgment in such a law action. No
relief of this character has been thought justified in the long history of equity
jurisprudence.
21

We are of opinion that the injunction issued in this case is not authorized either
by statute or by the usages of equity and that the decree granting the injunction
should be reversed.

22

Reversed.

23

Mr. Justice DOUGLAS, with whom Mr. Justice BLACK, Mr. Justice
MURPHY and Mr. Justice RUTLEDGE concur, dissenting.

24

I think the writ should be dismissed. For I do not think this is a proper case in
which to exercise our jurisdiction under 262 of the Judicial Code, 28 U.S.C.
377, 28 U.S.C.A. 377.

25

Our jurisdiction under 262 has been fully reviewed by the Chief Justice in
United States Alkali Export Ass'n, Inc. v. United States, decided this day. 325
U.S. 196, 65 S.Ct. 1120. I agree that the exercise of our extraordinary
jurisdiction was appropriate in that case. For the question presented not only
went to the jurisdiction of the District Court to entertain the suit. If the
defendants in that suit were right in their contention, a trial on the merits would
have frustrated the statutory scheme which Congress had designed for the
control of anti-trust activities.

26

But there is no such extraordinary situation presented here. This is precisely the
kind of decree which Congress by the Expediting Act of February 11, 1903, as
amended, 15 U.S.C. 29, 15 U.S.C.A. 29, intended should not be brought
here for review. With reference to the change made by that Act, Mr. Justice
Brandeis speaking for the Court in United States v. California Cooperative
Canneries, 279 U.S. 553, 558, 49 S.Ct. 423, 425, 73 L.Ed. 838, said: 'These
provisions governing appeals in general were amended by the Expediting Act
so that in suits in equity under the Anti-Trust Act 'in which the United States is
complainant' the appeal should be direct to this court from the final decree in
the trial court. Thus, Congress limited the right of review to an appeal from the
decree which disposed of all matters, see Collins v. Miller, 252 U.S. 364, 40
S.Ct. 347, 64 L.Ed. 616; and it precluded the possibility of an appeal to either
court from an interlocutory decree.'

27

To allow this appeal is to defeat that policy. Long ago in Bank of Columbia v.
Sweeney, 1 Pet. 567, 569, 7 L.Ed. 265, Chief Justice Marshall stated that an
allowance of an appeal from an interlocutory ruling where Congress permitted
an appeal only from a final judgment would be a 'plain evasion' of the Act of
Congress. We made a like ruling only recently in Roche v. Evaporated Milk
Ass'n, 319 U.S. 21, 30, 63 S.Ct. 938, 943, 87 L.Ed. 1185, where we said:
'Where the appeal statutes establish the conditions of appellate review an
appellate court cannot rightly exercise its discretion to issue a writ whose only
effect would be to avoid those conditions and thwart the Congressional policy
against piecemeal appeals in criminal cases.'

28

The present case presents no issue which warrants a departure from that long
settled practice. This case raises no question of grave public importance. It is
by no means comparable to Ex parte United States, 287 U.S. 241, 53 S.Ct. 129,
77 L.Ed. 283, where the interlocutory decree was equivalent to a denial of the
absolute right of the government to put the accused on trial. It is wholly unlike
the cases cited in United States Alkali Export Ass'n, Inc. v. United States,
supra, where writs were issued under 262, to review inter ocutory orders
which foreclosed the adjudication of rights entrusted to the jurisdiction of a
state tribunal or which deprived a party of his basic right of trial by jury. The
public importance of the present question is not apparent. The actual hardship
imposed upon the defendants is no more than the cost of procuring a bond. It
has always been assumed that mere hardship or inconvenience alone was not
sufficient to justify resort to the extraordinary course of review by way of
262. United States Alkali Export Ass'n Inc. v. United States, supra. Is the
inconvenience of private litigants to be the newly found ground for evading the
Expediting Act?

29

The reason advanced for departing from the long standing practice is that 'the
order was beyond the powers conferred upon the court.' By that test every
interlocutory order which is wrong can be reviewed here under 262. That is
novel doctrine. That seems to be the test for the Court says that the order can
now be reviewed because it involves 'a matter lying wholly outside the issues in
the case.' In other words, we look to the merits and take the case under 262 if
it appears that the District Court exceeded its authority. But it always exceeds
its authority when it abuses its discretion. Thus we must now entertain these
appeals on interlocutory orders, though Congress said we should not, in order
to determine whether the District Court kept within bounds. Certainly Congress
knew that some interlocutory orders might be erroneous when it chose to make
them non-reviewable. It did not draw the distinction now suggested between
interlocutory orders which are an abuse of conceded judicial power and
interlocutory orders which otherwise exceed judicial authority. Congress

moreover knew that if immediate review of interlocutory orders could not be

had, no decision on the merits might be able to 'redress any injury done by the
order'. But that was the choice which it made. We should respect it.
30

The decision, if followed, will open the flood gates to review of interlocutory
decrees. It circumvents the policy of Congress to restrict review in these cases
to final judgments.

28 U.S.C. 377, 28 U.S.C.A. 377.

26 Stat. 209 as amended 15 U.S.C. 1, 2, 15 U.S.C.A. 1, 2.

28 Stat. 570 as amended 15 U.S.C. 8, 15 U.S.C.A. 8.

See In re Chetwood, 165 U.S. 443, 462, 17 S.Ct. 385, 392, 41 L.Ed. 782;
Maryland v. Soper, 270 U.S. 9, 30, 46 S.Ct. 185, 189, 70 L.Ed. 449.

28 U.S.C.A. following section 723c.

N.Y.Civil Practice Act, 902; 7 Carmody, New York Practice, 309;

Thorington v. Merrick, 101 N.Y. 5, 3 N.E. 794; Brown v. Chaminade, Velours,
Inc., 176 Misc. 238, 26 N.Y.S.2d 1009; Avery v. Avery, 119 App.Div. 698, 104
N.Y.S. 290. Compare Lazenby v. Codman, D.C., 28 F.Supp. 949; Shiel v.
Patrick, 2 Cir., 59 F. 992.

15 U.S.C. 4, 15 U.S.C.A. 4.

Appalachian Coals Inc. v. United States, 288 U.S. 344, 377, 53 S.Ct. 471, 480,
77 L.Ed. 825.

15 U.S.C. 6, 15 U.S.C.A. 6.

10

15 U.S.C. 11, 15 U.S.C.A. 11.

11

Deckert v. Independence Shares Corporation, 311 U.S. 282, 61 S.Ct. 229, 85

L.Ed. 189.

12

Looney v. Eastern Texas R. Co., 247 U.S. 214, 38 S.Ct. 460, 62 L.Ed. 1084;
Ohio Oil Co. v. Conway, 279 U.S. 813, 49 S.Ct. 256, 73 L.Ed. 972; Virginian
R. v. System Federation, 300 U.S. 515, 57 S.Ct. 592, 81 L.Ed. 789; Gibbs v.
Buck, 307 U.S. 66, 59 S.Ct. 725, 83 L.Ed. 1111.

13

This power has often been exercised in cases where a court of equity has first

taken jurisdiction of a res and where some other court has thereafter essayed to
deal with that res. See, e.g. Wabash R. Co. v. Adelbert College, 208 U.S. 38,
45, 28 S.Ct. 182, 183, 52 L.Ed. 379; Palmer v. Texas, 212 U.S. 118, 129, 130,
29 S.Ct. 230, 233, 234, 53 L.Ed. 435; Princess Lida of Thurn and Taxis v.
Thompson, 305 U.S. 456, 467, 59 S.Ct. 275, 281, 83 L.Ed. 285.
14

Martin v. James B. Berry Sons' Co., 1 Cir., 83 F.2d 857; Cities Service Co. v.
McDowell, 13 Del.Ch. 109, 116 A. 4; Wahlgren v. Bausch & Lomb Optical
Co., 7 Cir., 77 F.2d 121; Campbell v. Ernest, 64 Hun 188, 19 N.Y.S. 123; Platt
v. Elias, 101 App.Div. 518, 91 N.Y.S. 1079; Maine Products Co. v. Alexander,
115 App.Div. 112, 100 N.Y.S. 711; Goldin v. Tauster, 68 Misc. 459, 125
N.Y.S. 83; Wright Co. v. Aero Corporation, Sup.Ct., 128 N.Y.S. 726;
Broadfoot v. Miller, 106 Misc. 455, 174 N.Y.S. 497; compare Gordon v.
Washington, 295 U.S. 30, 37, 55 S.Ct. 584, 588, 79 L.Ed. 1282.

15

See 28 U.S.C. 376, 28 U.S.C.A. 376.

16

D. Ginsberg & Sons v. Popkin, 285 U.S. 204, 208, 52 S.Ct. 322, 323, 76 L.Ed.
704.