Document 3yM16Dd2Xj4dN98KJBZBbwjx

racy 7-8-43 Witnesses FOR THE COMMISSION d ir e c t CROSS REDIRECT EECROSS HeCarthy, Fred 105? Rowe, Harold 1095 1140 1165 1172 Auchinclcss, Wm. S. 1110 1128 1137 Exhic COMMISSION*S FOR IDE: : : :t f c a mT^VV ;iV*< V ** ;v Z 22-A thru 22-2-47 1181 92, 93-A thru -1 1181 94~A thru -G 1181 538 1103 595, 596-A and -B 1163 597, 59o, 599 1163 601-A and -B,` 603 1163 609, 610 1163 S06-A thru -J 1066 1099 807-A 'thru h 1092 1094 808-A thru H 1122 1133 N39103 OFFICIAL REPORT OF PROCEEDINGS BEFORE THE Federal Trade Commission DOCKET No....5253*. & the Matter of:.. .. $ r mi90^ - ' s'*:- s 'fa'-'" ''" " ' *'>, y- ^ WASHINGTON 6, tk . 1UTKHML < 4M7 .v *r ' f*-;: *<v /#*** '. -< 4y* *v w-T-< ' . .?rt St N39103.01 CERTIFICATE This is to certify that the following pages and related exhibits are a transcript of hearings before the FEDERAL TRADE COMMISSION in the matter of: DOCKET HO. CASE TITLE - 5253* VJL7Z0HAL LEAD OOKPAHT, et al. pl ac e - lew York, I. Y. dat e . - June 26, 19^6. PAGES NUMBERED 1062' to 1183 INCLUSIVE. which were had as therein appears, and that this is the original transcript \.' thereof for the files of the Commission. \ V, ^v * .,,* & ELECTREPORTER, INC. Official Reporter \UMfrvSL ^AAxLoiW /yioe-President. N39103.02 IO69 Company, which operates from mines in the supply state area; but their production is nil, so far as our own requirements are concerned, and *e are dependent upon the market for our supplies, Q Does that hold true over a period of years, say back to 1930 to 19351 A Tee, we have never been a factor, to ay recollection, in the mining business. q You mentioned several suppliers of pig lead, whioh Is used in the manufacture of pigments. Could you list those in the order of importance; that is to say, in the order of the largest purchasee that you make. MR, DtTBOSE: That is, of percentages, Mr.Wrightt MR, WRIGHT: Yes, percentages, THE WITNESS: We keep the figures, Mr, fright; and while I am not connected with the metal purchasing departseni , I don't know that I would be a competent witness on a ratio basis, because all I oould say would be to approximate them. But I would say from the figures I have seen from time to I time, that our largest single source of supply would be St. 21 Joe; and of course, since Pearl Harbor, the metal reserve division of the Federal Government has more or lese monopol 23 ized the distribution of pig lead. They buy, of course, iron, 24 the field, and we in turn are allocated in our own pig lead 25 requirements from Washington from them. N39103.03 10?0 I 0 From the records that vou huve seen, ani do -ou h.ive t.ny I otr.er knowledge, whether the price at which pig lead is pur 3 chased from St. Joe, are the same a. which pig leal is purchg* 4 ed from American Smelting and Refining? , 5 A The market on pig lead is uniform, yes. 6 0 Han you state what lead pigments the National Lead i ! i ! I ! 7 Company produces;at the present time? S A We produce basic oatbonate of white lead, which is kr.oirr q in the trade as dry white lead. We produce basic sulphate cf 10 lead, which is another type of white lead, and those are the II two large articles of commerce in the paint industry. And 12 then, in addition, we produce various grades of dry red lead, S3 which are used in the manufacture of red lead paints, and 14 those, in the phraseology of the trade, are the only pigmenti 15 we produce -- lead pigments, that is. 16 Q Does the Company also produce litharge? I? A Tee. Litharge is an oxide, and we are also a producer of II litharge. 19 Q Doss it produce Orange mineral? 20 A That is a very minor article of commerce, and we have pro 21 duced orange mineral, but frankly, I don't know how long 22 ago it was. 23 Q Are any other additional pigments that the 'TatlonalLead 24 Company sells purchased from others, not produced by Wation25 al Lead? / 1071 I YF EtlfGs You mean lead pigments? 2 VLP.m WRIGHT: Yes. 3 THE WITNESS: There is a product known &a lead ace 4 tate, which at one time we manufactured, tout because of its 5 very minor tonnage, it is my understanding that in recent 6 years we have purchased it of another chemical company, be 7 cause the tonnage is such a minor factor that it didn't pay 8 us to maintain Its production. 9 Q Does National produce the so-called "Blue Lead* ? !0 A Wo, blue lead is a oy-product of the smelting process, !1 and sinoe we are not miners and smelters, we don't have ac 12 cess to that type of material. 13 Q Does National sell, or have they ever sold it to your M knowledge? 15 A Occasionally, when specifications have favored blue lead, U in order to be competitive, we have secured it in the outside \7 market and we sold it just to keep our place in the picture. 18 # Q From whom do you recall National purchasing it? 19 A I would assume it would be secured from Eagle-Pioher, 20 the only known manufacturer of the material. 21' Q Am I oorrect in understanding that National maintains 22 factories and plants in various part a of the United States for 23 producing these various pigments? 24 A 25 Wo are in production of white lead products of five points, the Wew York area at Perth Amboy, ^ew Jersey, Phila- 10?2 s delphia, Chicago, St. Louie, and in the Oakland section of 2 San Francisco. 3 Q Can you state the percentage of production that is ac 4 counted for at each one of these points? 5 MR. EWIN3* You aean the percentage of National's 6 production? 7 MR# WRIGHT: Yea, the percentage of National's pro a duction. 9 THE WITNESS: I would say kO% at Chicago; 3<# In 10 Hew York; and 10$ at each of the other three points, Phila 11 delphia, St.Leals and San Francisco. 12 Q At what points does National produce lead sulphate? S3 A Only in St# Louis. 14 Q Can you state briefly the process by which lead sulphate IS la produced. nA Lead sulphate is a pigment that is chemically precipitat 17 ed from lead oxide. : In other words, the litharge of a proper 11 grade and fineness is precipitated in the presence of sul If phuric aoid, and produced as lead sulphate. 20 Q What processes of producing basic carbonate are employ 2S ed by Wational? 22 A We are using three processes at the present time: 23 Carter process, in which atomized load or lead dust is treat 24 ed in revolving cylinders in the presence of aoetlo aoid and 25 carbon dioxide. And we use a Thompson-Stewart proooss of 1073 ! our own development, in which lead oxide is precipitated 2 chemically in the presence of acetic acid. And at one point ' 3 we use the Old Dutch process, in which lead buckles or is 4 exposed in stacks in piles of tanb^rk, fora period of 120 5 days, developing a form of lead carbonate at the end of that 6 time by a rath** natural process. 7 Q Can you state whether the resv ting product is substan 8 tially the same thing? 9 A All three products conplv with Federal Specifications. 10 q Is there any difference in these three products, prodnoed 11 by the threat 12 A Tea, their differences are primarily for the raw materiaL 13 customer who, for example, wants certain qualities in his pro 14 duct. A potter ceramic manufacturer will have & different 15 requirement than a paint grinder; and the manufacturers of H putty will use a different grade of lead than the manufactur 17 er* of dry colors, for example. 98 Q With respect to the basic carbonate that is sold to pain* 19 manufacturere, le there any difference in quality as between 20 the oarbonate produced by any of these three processes? 21 A In this respect only: That some of these pigments are 12 the finer partiole else, because of their method of manufact 23 ure, and therefore they have different characteristics for 24 the paint manufacturer in point of color and paint consis 25 tency and tinting strength. 10SO i I of Mined, or to the Lead Industries Association; and with re- j 2 spent to Lead Industries Association, that information supI plied it by individual companies is never given out to the i t 4 other companies, except in a total fora. In other ffords. 5 National*? production In particular lines supplied to Lead 6 Industries Association is never passed out to any other member 7 as National1s production in that line* a In view of the fact that it is made a practice not 9 to dl801086 that information, and in view of the fact that 10 it regards it as an important element of its business which 91 should be kept confidential, I feel constrained to instruct (I the witness not to answer the question. IS MR. WRIGHT: Well, your Honor, I would like to point 14 out that there is already in the record Commission1 e Exhibit 15 664, which consists of a memorandum of the sales of white 16 lead and white-lead-in-oil by The National Lead Company, the 17 total sales, which baa aiready been received in evidence in 18 the case. If NR. MaoINTYRE* That is one of the pigments involved 20 here. The other pigments, of course, are, I would say, no 21 ore Important to the position of National in its desire to 22 withhold its disclosure than would be white lead; and the 23 charges in the complaint are to the effect that the large 24 percentages of the total business in each of these disolosed 25 ita monopolistic position that it holds. How else can you 1051 I 1 prove that fact, in answer to the allegations of the complaint 2 except toy getting answers to the Questions of the line such 3 as represented toy the pending one. 4 TRIAL HAMMER 1 GET#COB: It will not be necessary to 5 put anything further on the record, because the rest of the 6 talk had to be to the District Judge. The counsel hae ad ? vised, or rather instructed and advised this witness to re 8 fuse, and I take it that the witness does refuse on the ad 9 vice of counsel. 10 TIE WIME8S: Ye, air. It TRIAL EXAMINER NCRWGOD: Now the Commission's ooun*4l tl know they are limited. They may go to the District Court for 13 an order to make him answer, if they show it is relevant -- 14 if they show its relevancy, materiality, and necessity for IS it. In that oasis the Court will instruct the witness to 16 answer it. 17 By Mr, Wrighti ti l Mr, McCarthy, has The National Lead Company reoeived from 19 the Load industries Association statistics which show the 20 jropertioa of the production or sales of lead pigments of The It national Lead Company to the total production of suoh pig22 &ents for the industry? 23 I We received from the Lead Industries Association total 24 Industry figures, and knowing what our own figures,are, we 25 an determine in air own organization by ratio what cur 1032 j ! jompetitlve position is; tut we don't know what share of the j 2 aalance belongs to any individual competitor. j 3 l My question was: Has The Rational Lead Company ever re- j ! 4 :eived such information coopiled to show the percentage of j 5 [he National Lead Company to the total from the Industry? i 6 i Regularly on each month, we can tell what our share of the ? total is. 8 MR. BRING: I move to strike that as not responsive 9 TRIAL EXAMINER HORWOOD: Read the question and answer, 10 >lease. IS MR. WRIGHT: Your Honor, I accept that answer. 11 (The question and answer were read.) 13 TRIAL EXAMINER HCRWOGD; Your motion to strike the 14 newer is denied. 15 ly Mr. Wright; 16 In what form are the statistics showing the production of 1? he industry received by National Lead Company from Lead In- II uatriss Association? 19 A page headed by the type of product, showing the total 20 ndU8try's production, deliveries and inventories, as of the 21 nd of the month. 22 Does that page, as it is received from Lead Industries 23 seoolation by National Lead Company, have entered upon it 24 e percentage of National Lead Cooqpany1 a production and 25 lea, inventories, and shipments to the total? I 1063 1 MR. DuBOSE: (Interposing) I object to that ques 2 tion, as involving two concepts. He said Does it have en 3 tered on it. At what stage do you mean, Mr. Wright? Do you 4 mean the way It was originally? 5 MR. WRIGHT: When it was received by The National 6 Lead Company. That was the question. ? THE flwilSS; No. I By Mr. Wright: 9 Q Do you report to the Lead Industries Association your 10 total production, sales, shipments, and inventories of these li pigment? 12 A Tea. 13 Q At what Intervals! 14 A Each month. 15 Q And is that information also reported to the Bureau of 16 Mines? 17 A I think the Bureau oolleots it quarterly. 13 Q Quarterly* S9 A Tee. 20 TRIAL EXAMINER NCRWOCD: Now ia it confidential when 21 you send it to the Association? 22 THE WITNESS: Tea, sir. 23 TRIAL EXAMINER NORWOOD: And confidential, when you 24 send it to the Bureau of Mines? 2S THE WITNESS: Yes. m? 1 By Mr. Wright; 1084 I 2 Q Ib suoh Information disseminated to any other individual I or agency I A lot to my knowledge. 5 Q Mr. McCarthy, will you state, as to dry basic carbonate, 6 dry lead sulfate, white-lead-in-oil, dry red lead, dry lead- 7 in-oil, and litharge, the percentage of the sales of the I National Lead Company during the year 194-3 to the total of 9 such sales by the industry? 10 ME. EWING; I object to that question. It is similar tl o the prior question, and I advise the witness not to answer 12 it. 13 TRIAL EXAMINER NORWOOD: I lnstruot the witness to 14 answer the question. His counsel advises that he need not 15 : answer it. 14 Proceed with the examination. The counsel know their S? remedy. 1 MR. EWING; I advise him not to answer. 19 By Mr. Wright: 20 Q Will you answer the question, Ur. McCarthy? 21 A No, the same reason, because those total figures are known 22 to other people in the industry, and my ratio figures then 23 apply. It would give them the identloal information that I 24 .prefer not to answer. 25 aponsive MtoR.thWeRIqGuHeT:stioInm. ove to strike that answer as not reTRIM*. EXAMINER NCRWOCD: Read the question again. (Question read by the reporter.3 ALKY 1085 MR. WRIGHT; Your Honor I amend my mot ion to strike to mak it strife ill after the word "no." MR. EWING: I third: I am entitled to have his reason 4 lander the circumstances. 5 TR.J.AL XAMIHF.R NORWOOD: It might stand there for 6 the information of1 the court. 7 MR. WRIGHT: I submit yo'jr Honor if that information * 8 is to be in the record I don't like it to be in response to 9 a question cf mine;* * SO TRIAL EXAMINER NORWOOD: Read the answer ab.in* n (The reporter again read the answer.8 ,2 TRIAL EXAMINER NORWOOD: I think 1.1 has a point there, S3 I will allow the motion to strike everything after the word 14 "reason8 there* And the answer will be to stand to this 13 Bffeot, "No, for the same reason.* 16 By Mr* Wrights 17 Mr* McCarthy, do you recall supplying information oon~ ! serning freight rates on various lead pigments to representa If tives of the Commission in connection with an investigation 20 jf the National Lead Company? 21 2 do* ' 22 Are you able to state whether the freight rates actually 23 ised in the shipment of lead pigments from the National Lead 24 Jompany to destination of the customer would be the same 25 red >n red lead-in-oil or dry/lead or litharge when packed in