299 F. 615 | E.D.S.C. | 1923
This matter , came on upon a motion to quash and set aside a subpoena duces tecum, issued herein on behalf of the defendants, and directed to the American Telephone & Telegraph Company, and served on the agent of said company on October 9, 1923, and counsel for both complainant and defendants have appeared and been heard.
Although it.may well be that it is pertinent in this case to produce testimony to show what is a proper rental to be paid under the circumstances by the Southern Bell Telephone & Telegraph Company to the American Telephone & Telegraph Company, yet it would not appear that the defendants have a right to ascertain that by compelling the American Telephone & Telegraph Company to show what are its costs of production of the transmitters, receivers, and coil leased, and its profits under its rental contract. Whether or not 4% per cent, on the gross receipts of the Southern Bell Telephone & Telegraph Company is a fair and proper payment'to be made is a point at issue. If it can be shown that the same articles in the nature of transmitters, receivers, and coil can be manufactured or furnished for substantially less than the amount paid, it would be pertinent to show it in this case; but the question of profit on production to the lessor is not competent for that purpose.
The American Telephone & Telegraph Company has a right to-receive whatever the other party is willing to pay, and what profit it may make between the actual cost of the article furnished and the amount the Southern Bell Telephone &, Telegraph Company is willing to pay
This the defendants can prove by any competent testimony they see fit. They can examine any competent witnesses, to show what is the true and proper cost of manufacturing, producing, or procuring these articles. If any of the employees of the American Telephone & Telegraph Company are competent witnesses to prove the same, they may be subject to subpoena to testify as any other witness; but the American Telephone & Telegraph Company cannot be compelled itself, under the issues in this case, to furnish evidence of what its profits are.
It is therefore ordered and adjudged that the subpoena be_ quashed and set aside, but without prejudice whatsoever to the right of the defendants, having issued such subpoena, to produce such competent testimony as they may have a right to produce, to prove what is the real and proper costs or expense that should be paid for manufacturing and producing or furnishing to the Southern Bell Telephone & Telegraph Company the articles in question.