Mr. POTVIN. Mr. Chairman, may I ask counsel if it would be appropriate for his client, in sort of a thumbnail sketch term, to describe any further dealings he may have had during 1965 with the Bristol firm without in any way endangering or impinging upon your litigation? Mr. Woods. I think the fact that Bristol Laboratories cut them off in October of 1965 can go into the record. That is an established fact. Mr. POTVIN. May I ask this specifically subject to any reservation or objection you may wish to impose.

Is it not a fact, Mr. Mandell, that in October 1965 you were visited by a Mr. Abel, national sales manager of Bristol, who told you-I believe that I am quoting "You are to make no sales to H. L. Moore or Biddle," and you were further told not to sell to any mail-order wholesaler?

Please do not answer until you have conferred with your counsel. Mr. WOODS. Again, I think I have to object. It gets into the realm of our litigation.

Mr. POTVIN. I will withdraw the question, then, subject to your filing the complaint.

Mr. DINGELL. May I ask this question. Is that statement included in the complaint in any of your antitrust matters?

Mr. WOODS. No. That statement is not included verbatim in the complaint.

Mr. DINGELL. Is some statement similar to that included in the complaint, and, if so, what is the nature of the statement?

Mr. WOODS. No. There is no verbatim statement of that nature included in the complaint.

Mr. DINGELL. Has that statement been made in any of the depositions or discovery proceedings made in regard to the case pending against the firm mentioned?

Mr. WOODS. Yes, it has.

Mr. DINGELL. It has been. Was that made by any of the companies concerned or was it made by you and your client?

Mr. Woods. It was made in both the examination of the plaintiff and the examination of the defendant.

Mr. DINGELL. I see. Would it be appropriate for you to make available to the subcommittee a copy of the information taken in the examination?

Mr. WOODS. Well, again, Mr. Chairman, I don't wish to try my lawsuit in the committee. On the other hand, at the appropriate time that the depositions are filed at the pretrial conference and become a matter of public record, at that point they are free for anyone to see.

Mr. DINGELL. Well, at the appropriate time, then, if you feel it proper, the committee will be happy to receive that information. In the meantime, in view of your lawsuit now pending, we will not request you to submit it to us at this time.

Mr. POTVIN. You have already testified that during 1965 you were cut off by Bristol, and we will leave that subject.

Can you tell us the continuing nature of your relationship with the Sandoz and Eaton firms during the remainder of 1965?

Mr. MANDELL. Yes. The Sandoz and Eaton firms continued their practices as they had throughout the entire year and in addition we received further indications from other manufacturers that we were going to have problems. We started to see a delay in the orders from the A. H. Robins Co.

Mr. DINGELL. What firms were these that so indicated to you?

Mr. MANDELL. Well, I was going to tell you the A. H. Robins Co. They started to take a longer time to ship our orders than they had previously. This started in late 1965. And, in fact, we received a visit from the national sales manager of Roche Laboratories.

Mr. DINGELL. What was his name?

Mr. MANDELL. Robert Abrams.

Mr. DINGELL. And what was the nature of his visit and what comments and discussions took place at that time?

Mr. MANDELL. The nature of his visit at that time was purportedly to discuss the new contract they were going to release for the wholesalers to sign.

Mr. DINGELL. What was the new contract he was going to submit? What were the terms of this?

Mr. MANDELL. I didn't see it. We never got around to it. He started to ask me where we were selling our merchandise and whether we had accounts outside of New York, and when I told him we did, he asked me who they were and I told him who they were.

Mr. DINGELL. Did he ever indicate to you what your trading area was or was to be according to their wishes?

Mr. MANDELL. Yes.

Mr. DINGELL. What did he say to you in this matter?

Mr. MANDELL. He told me that it wasn't our prerogative to sell to H. L. Moore and to Biddle because if his company wanted to sell to these people, they could sell to them themselves. And when the new contract was forwarded to wholesalers, the fact of our selling to these people would be taken into consideration in awarding or not awarding

a contract.

Mr. DINGELL. Awarding or not awarding a contract to you?

Mr. MANDELL. Yes; and he said at the time he advised me to reconsider our position where he wasn't going to tell me or couldn't legally say you must stop selling to H. L. Moore and to Biddle, it would be taken into consideration when awarding the new contract.

Mr. DINGELL. Did he say that he could not legally tell you not to sell to either Biddle or Moore?

Mr. MANDELL. Yes, he did.
Mr. DINGELL. He said that.

Mr. MANDELL. Yes.

Mr. DINGELL. But he said it would be taken into consideration in determining whether or not you would receive a contract from his firm to sell as a wholesaler? Is that correct?

Mr. MANDELL. That is correct.

Mr. DINGELL. Did you continue to sell to Moore and Biddle?

Mr. MANDELL. We did.

Mr. DINGELL. Did you receive a contract from them?

Mr. MANDELL. Yes, we did. I will tell you why we received a

contract.

Mr. POTVIN. Mr. Chairman, if I may double back for just a little embroidery I would like to bring out several details.

First of all, was Dr.-Mr. Robert W. Abrams, the national distribution manager for Roche?

Mr. MANDELL. Yes. I think he holds-I know he holds the title of doctor, so you might refer to him as doctor.

Mr. POTVIN. Did you know him?

Mr. MANDELL. I had never met him before.

Mr. POTVIN. Were you aware of his position and acquaintanceship within the industry, and, if so, state what it is?

Mr. MANDELL. Yes. He was at one time I believe president of the American College of Apothecaries and he came to Roche under the auspices of William Enes.

Mr. POTVIN. Is this the same Mr. Enes who had been a subordinate of Ed Beckwith at Warner-Chilcott?

Mr. MANDELL. Yes, it is.

Mr. POTVIN. Who is the gentleman who had cut you off on another line?

Mr. MANDELL. Yes, he was.

Mr. POTVIN. Now, about this conversation that you had about not selling to Moore and Biddle, where precisely did that take place?

Mr. MANDELL. Well, he didn't seem to want to talk about that in the office in front of people walking in and out, so he asked to see the warehouse merchandise where his line was kept, and the discussion took place in the back of the warehouse among the merchandise.

Mr. POTVIN. Were there witnesses nonetheless to the conversation? Mr. MANDELL. Yes. I had had similar experiences with other manufacturers, and I instructed two people who work in our place to station themselves in a position where they could overhear the conversation, listen to what was said, so that, in fact if something were denied later, I wanted the course of justice to be served and I didn't want anybody bludgeoning me without having someone around to hear the thud of the hammer as it bounced off my head.

Mr. DINGELL. Was there in any of these discussions with the individuals or the firms that you have mentioned so far any discussion about the fact that you were selling at 10-percent less than cost or at 10-percent off?

Mr. MANDELL. I don't think it was specifically referred to as 10percent off. It was discounting.

Mr. DINGELL. Was there mention made of your practice of discounting?

Mr. MANDELL. Yes.

Mr. DINGELL. What comments were made and by whom?

Mr. MANDELL. Oh, just about everybody. There is always a discussion as to pricing policies in the industry.

Mr. DINGELL. Well, now, with regard to Bristol Labs, was there any discussion as to discounting?

Mr. MANDELL. Yes. We had a general discussion of the entire industry and the practice of diversion.

Mr. DINGELL. Well, now, you have been discussing the practice of diversion. Did they ever discuss with you the fact that you were discounting?

Mr. MANDELL. We discussed discounting

Mr. DINGELL. Were there allusions to it, subtle allusions to it? Mr. MANDELL. Yes.

Mr. DINGELL. What form did these allusions take and by whom were they made?

Mr. MANDELL. It would be very difficult to go back and remember exact words or how it came out in the conversation because it wasn't that important to me at the time. It seemed that the basis of the entire attack upon us was the fact that we were selling to people who were outside our trading area at a price which was raising a lot of static in their area where they were focated among other wholesalers.

Mr. POTVIN. At a price which was introducing price competition into many markets throughout the country, is that not correct? Mr. MANDELL. Exactly.

Mr. DINGELL. So then the fact that you were selling at a discount in other peoples' so-called trading areas was definitely a factor. Had you been selling simply at the same cost that the other wholesalers were selling, there probably would have been no complaint. Am I correct?

Mr. MANDELL. I am quite certain there would have been no complaint, although there still may have been a complaint insofar as a fellow from a different trading area is coming into this specific area and taking business away from the account which is geographically located and historically and traditionally located and doing business in this area.

Mr. DINGELL. Did you have any discussions about the price at which you were selling in these other trading areas?

Mr. MANDELL. Yes.

Mr. DINGELL. With any of the people concerned?

Mr. MANDELL. Yes.

Mr. DINGELL. What was the gist of those discussions?

Mr. MANDELL. Well, again, I didn't pay too much attention to those discussions. I was so troubled with the fact that nobody wanted to sell to us. I can recall one specific discussion. Dr. Abrams asked me, and he also very nicely advised me, very kindly advised me that I didn't have to tell him if I didn't want to, but he asked me what price we were charging H. L. Moore for the Roche merchandise and what price to the Biddle group for the Roche merchandise.

Mr. DINGELL. Did you tell him?

Mr. MANDELL. Yes, I did.

Mr. DINGELL. What was his response?

Mr. MANDELL. His response was this is a mighty low price you are charging, you must not be making too much profit in this line.

Mr. POTVIN. During this time can you tell us about your relationship with the A. H. Robins firm? Is it not a fact that there was a very sharp, 50-percent or 100-percent increase in the delays and in the unfilled orders?

Mr. MANDELL. Yes. No. Robins never for a moment failed to fill an order of ours. They did in fact delay it. There was an increase in the time elapsed on shipment of our orders.

Mr. POTVIN. They just took longer though they didn't short it? Mr. MANDELL. What had traditionally been the time elapsed for filling. I think it went sometimes double the normal amount of time, from the time of giving the order to the time of receipt of merchandise.

Mr. POTVIN. And at or about this time did anyone from the Robins firm visit you?

Mr. MANDELL. Yes, sir.

Mr. POTVIN. What was his name and title?

Mr. MANDELL. In the early part of January the regional sales manager from Robins visited us and his name is Jack or John Byrne. Mr. PorVIN. What did he tell you?

Mr. WOODS. Mr. Chairman, we are also in litigation with A. H. Robins Co. I think we are getting into the area of the lawsuit in this line of questioning, too.

Mr. PorvIN. Mr. Chairman-and this question, Mr. Witness, is asked you subject to any reservation or objection that your counsel may wish to interpose, so please consult with him before answering it-is it not a fact, sir, that Mr. Byrne after pointing out that you were not the only firm selected for his visitation and that this was a broad effort to secure cooperation in holding the line on Robins' merchandise, asked you to stop selling to Moore or at least to raise your price to Moore? Is that not a fact, sir?

Mr. WOODS. I have to interpose my objections, Mr. Counsel.

Mr. DINGELL. Gentlemen, at the appropriate time I think it would be helpful to the committee if you would submit to us the pretrial records, your discovery proceedings, depositions on this matter, and so forth for the benefit of the committee.

Counsel?

Mr. POTVIN. May I inquire, Counsel, was this matter covered in any of your discovery procedures in the litigation?

Mr. Woops. Not at the present time.

Mr. PorvIN. But you are still in the process.

Mr. Woods. Yes. In the pretrial discovery.

Mr. POTVIN. Presumably it will be covered during the course of litigation.

Mr. Woods. It will.

Mr. PoTvIN. Now, drawing your attention back to the Roche firm, did you have any further difficulties with that manufacturer during the next few months?

Mr. MANDELL. Yes. There came a time shortly after the visitation. by Dr. Abrams when I was informed that they were holding one of our orders and weren't going to ship the merchandise because they thought all of the merchandise wasn't "for us."

Mr. PorvIN. There was no position taken by the manufacturer that the merchandise ordered was in short supply?

Mr. MANDELL. No, sir.

Mr. POTVIN. And there was no question as to your credit capability? Mr. MANDELL. No. There never was. We always discounted our bills. Mr. POTVIN. I see. During this time did you take any steps to call to the attention of the manufacturers in the industry the problems of those Bronx retailers who had told you they were getting less than adequate service?

Mr. MANDELL. I wrote a number of letters to pharmaceutical manufacturers who had traditionally refused to sell us.

to?

Mr. POTVIN. Can you tell us how many manufacturers you wrote

Mr. MANDELL. Well, I think 10 or 11.