White Collar Crime: The Heavy Electrical Equipment Antitrust Case of 1961

  • Gilbert Geis
Part of the The Plenum Series in Crime and Justice book series (PSIC)


An inadvertent bit of humor by a defense attorney provided one of the major criminological motifs for “the most serious violations of the antitrust laws since the time of their passage at the turn of the century.”1 The defendants, including several vice-presidents of the General Electric Corporation and the Westinghouse Electric Corporation—the two largest companies in the heavy electrical equipment industry—stood somberly in a federal courtroom in Philadelphia on February 6, 1961. They were aptly described by a newspaper reporter as “middle-class men in Ivy League suits—typical business men in appearance, men who would never be taken for lawbreakers.”2 Several were deacons or vestrymen of their churches. One was president of his local chamber of commerce, another a hospital board member, another chief fund raiser for the community chest, another a bank director, another a director of the taxpayer’s association, another an organizer of the local little league.


General Electric York Time White Collar Crime Grand Jury Antitrust Case 
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  1. 1.
    Judge J. Cullen Ganey in “Application of the State of California,” Federal Supplement, 195 ( Eastern District, Pennsylvania, 1961 ), p. 39.Google Scholar
  2. 2.
    New York Times,Feb. 7, 1961.Google Scholar
  3. 3.
    New York Times,Feb. 7, 1961.Google Scholar
  4. 4.
    Edwin H. Sutherland, White Collar Crime, New York: Holt, Rinehart and Winston, Inc., 1949, p. 240. Note: “Private enterprise remains extraordinarily private…. We know more about the motives, habits, and most intimate arcana of primitive peoples in New Guinea… than we do of the denizens of executive suites in Unilever House, Citroen, or General Electric (at least until a recent Congressional investigation).”—Roy Lewis and Rosemary Stewart, The Managers, New York: New American Library, 1961, pp. 111–112.Google Scholar
  5. 5.
    For an elaboration of this point, see Gilbert Geis, “Toward a Delineation of White-Collar Offenses,” Sociological Inquiry,32 (Spring 1962), pp. 160–171.Google Scholar
  6. 6.
    Edwin H. Sutherland in Vernon C. Branham and Samuel B. Kutash, Encyclopedia of Criminology, New York: Philosophical Library, Inc., 1949, p. 511.Google Scholar
  7. 7.
    Sutherland, White Collar Crime, p. 9, fn. 7.Google Scholar
  8. 8.
    United States Statutes,26 (1890), p. 209; United States Code,15 (1958), pp. 1, 2. See also William L. Letwin, “Congress and the Sherman Antitrust Law, 1887–1890,” University of Chicago Law Review,23 (Winter 1956), pp. 221–258, and Paul E. Hadlick, Criminal Prosecutions under the Sherman Anti-Trust Act,Washington, D.C.: Ransdell, 1939. The best interpretation of American antitrust law is A. D. Neale, Antitrust Laws of the United States,New York: Cambridge University Press, 1960.Google Scholar
  9. 9.
    Note: “Release of the Grand Jury Minutes in the National Deposition Program of the Electrical Equipment Cases,” University of Pennsylvania Law Review, 112 (June 1964), pp. 1133–1145.Google Scholar
  10. 10.
    John Herling, The Great Price Conspiracy, Washington, D.C.: Robert B. Luce, 1962, pp. 1–12; John G. Fuller, The Gentleman Conspirators, New York: Grove Press, Inc., 1962, pp. 7–11. See also Myron W. Watkins, “Electrical Equipment Antitrust Cases—Their Implications for Government and Business,” University of Chicago Law Review, 29 (August 1961), pp. 97–110.Google Scholar
  11. 11.
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  12. 12.
    Telephone interview with Judge Ganey, Philadelphia Aug. 31, 1964; New York Times, Dec. 20, 1961.Google Scholar
  13. 13.
    New York Times,Feb. 7, 1961. 14 New York Times,July 27, 1962. 15 New York Times,March 14, 1961.Google Scholar
  14. 16.
    New York Times,Apr. 29, 1964. Regarding Westinghouse see Wall Street Journal,Sept. 3, 1964. 17 Wall Street Journal,July 27, 1964.Google Scholar
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    Edwin H. Sutherland, “White-Collar Criminality,” American Sociological Review, 5 (February 1940), pp. 1–12Google Scholar
  16. 19.
    Senate Committee on the Judiciary, Subcommittee on Antitrust and Monopoly, 87th Cong., 2d Sess., 1961, “Administered Prices,” Hearings, Pts. 27 and 28. Unless otherwise indicated, subsequent data and quotations are taken from these documents. Space considerations do not permit citation to the precise pages.Google Scholar
  17. 21.
    The quotation is from an excellent two-part article by Richard Austin Smith, “The Incredible Electrical Conspiracy,” Fortune, 63 (April 1961), pp. 132–137, and 63 (May 1961), 161–164, which is reproduced in Hearings,Pt. 27, pp. 17094–17105 and 17172–17182.Google Scholar
  18. 21.
    See, for instance, Leland Hazard, “Are Big Businessmen Crooks?” Atlantic, 208 (November 1961), pp. 57–61.Google Scholar
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    Anthony Lewis, New York Times,Feb. 12, 1961.Google Scholar
  20. 23.
    Analysis of the relationship between occupational norms and legal violations could represent a fruitful line of inquiry. See Richard Quinney, “The Study of White Collar Crime: Toward a Reorientation in Theory and Research,” Journal of Criminal Law, Criminology and Police Science, 55 (June 1964), pp. 208–214.Google Scholar
  21. 28.
    A contrary view is expressed in Note, “Increasing Community Control over Corporate Crime—A Problem in the Law of Sanctions,” Yale Law Journal, 71 (December 1961), footnoted material pp. 287–289. It has been pointed out that Time Magazine (Feb. 17, 1961, pp. 64 ff.) reported the conspiracy in its business“ section, whereas it normally presents crime news under a special heading of its own.—Donald R. Taft and Ralph w. England, Jr., Criminology, 4th ed., New York: The Macmillan Company, 1964, p. 203.Google Scholar
  22. 31.
    See Edwin H. Sutherland, “Is ‘White Collar Crime’ Crime?” American Sociological Review, 10 (April 1945), pp. 132–139. Note: “It may be hoped that the Philadelphia electric cases have helped to dispel this misapprehension…. It should now be clear that a deliberate or conscious violation of the antitrust laws… is a serious offense against society which is as criminal as any other act that injures many in order to profit a few. Conspiracy to violate the antitrust laws is economic racketeering. Those who are apprehended in such acts are, and will be treated as criminals.”—Lee Loevinger, “Recent Developments in Antitrust Enforcement,” Antitrust Section, American Bar Association, 18 (1961), p. 102.Google Scholar
  23. 32.
    Paul W. Tappan, “Who Is the Criminal?” American Sociological Review, 12 (February 1947), pp. 96–102.Google Scholar
  24. 33.
    Sutherland, White Collar Crime,pp. 234–257.Google Scholar
  25. 34.
    Sutherland, p. 70.Google Scholar
  26. 33.
    Sutherland, p. 10.Google Scholar
  27. 36.
    Sutherland, p. 54.Google Scholar
  28. 37.
    For an excellent presentation, see Sanford H. Kadish, “Some Observations on the Use of Criminal Sanctions in Enforcing Economic Regulations,” University of Chicago Law Review, 30 (Spring 1963), pp. 423–449. See also Richard A. Whiting, “Antitrust and the Corporate Executive,” Virginia Law Review, 47 (October 1961), pp. 929–987.Google Scholar
  29. 38.
    Sutherland. White Collar Crime,p. 247.Google Scholar
  30. 39.
    John Kenneth Galbraith, The Affluent Society,Boston: Houghton Mifflin Company, 1958, p 84. See also Richard Hofstadter, “Antitrust in America,” Commentary,38 (August 1964), pp. 47–53. An executive of one corporation is said to have remarked regarding the collusive antitrust arrangements: “It is the only way business can be run. It’s free enterprise.” Quoted by Mr. Justice Clark to Antitrust Section, American Bar Association, St. Louis, Aug. 8, 1961, P. 4.Google Scholar
  31. 40.
    Max Weber, The Theory of Social and Economic Organization, translated by A. M. Henderson and Talcott Parsons, New York: Oxford University Press, 1947, pp. 367–373.Google Scholar
  32. 41.
    See Donald R. Cressey, Other People’s Money, New York: The Free Press of Glencoe, 1953; Gresham M. Sykes and David Matza, “Techniques of Neutralization: A Theory of Delinquency,” American Sociological Review, 22 (December 1957), pp. 664–670.Google Scholar

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© Springer Science+Business Media New York 1995

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  • Gilbert Geis

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