71 N.Y.2d at 331 Analyzing vertical restraints under state antitrust law25 citing cases“an application to quash a subpoena should be granted only where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry”
- Smith v. City of New York, 2024 NY Slip Op 34385(U) (N.Y. Sup. Ct., New York Cty. 2024).unpublishedThe party moving to quash the subpoena must first show that '"the futility of the process to uncover anything legitimate is inevitable or obvious'" or that "the information sought is 'utterly irrelevant to any proper inquiry."' Id at 38, q…
- Matter of Fulton Commons Care Ctr., Inc. v. James, 2024 NY Slip Op 02322 (N.Y. App. Div. 2d Dep't 2024).published "An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry" ( Anheuser-…
- Matter of People of the State of New York v. Tyson Foods, Inc., 2023 NY Slip Op 03975 (N.Y. App. Div. 1st Dep't 2023).publishedRespondent Tyson Foods, Inc. failed to demonstrate that the Attorney General's subpoena calls for documents that are utterly irrelevant to any proper inquiry or that "the futility of the process to uncover anything legitimate is inevitable…
- Matter of Broadway Stages, Ltd. v. New York State Jt. Commn. on Pub. Ethics, 2022 NY Slip Op 00085 (N.Y. App. Div. 3d Dep't 2022).publishedA subpoena should only be quashed "where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry," and the burden rests on the challeng…
- M&T Bank Corp. v. Moody's Invs. Servs., Inc., 141 N.Y.S.3d 800 (N.Y. App. Div. 4th Dep't 2021).published"An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious . . . or where the information sought is utterly irrelevant to any proper inquiry" ( Anh…
- Matter of Barber v. BorgWarner, Inc., 174 A.D.3d 1377 (N.Y. App. Div. 4th Dep't 2019).published"An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious . . . or where the information sought is utterly irrelevant to any proper inquiry" ( Anh…
- Matter of New York State Senate Repub. Campaign Comm. v. Sugarman, 2018 NY Slip Op 7218 (N.Y. App. Div. 3d Dep't 2018).published"An application to quash a subpoena should be granted only where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry" ( Anheuser-Bu…
- Matter of Evergreen Assn., Inc. v. Schneiderman, 153 A.D.3d 87 (N.Y. App. Div. 2d Dep't 2017).publishedAn application to quash an investigatory subpoena issued by the Attorney General should be granted where the information sought is “utterly irrelevant to any proper inquiry” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 331-332 [1988]).
- Bianchi v. Galster Mgmt. Corp., 131 A.D.3d 558 (N.Y. App. Div. 2d Dep't 2015).publishedHowever, the party or nonparty moving to vacate the subpoena has the initial burden of establishing either that the requested deposition testimony “is ‘utterly irrelevant’ ” to the action or that “ ‘the futility of the process to uncover a…
- Kapon v. Koch, 11 N.E.3d 709 (N.Y. 2014).published“An application to quash a subpoena should be granted ‘[o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious’ ... or where the information sought is ‘utterly irrelevant to any proper inquiry’ ” (A…
Show 14 more citing cases
- People v. Laughing, 113 A.D.3d 956 (N.Y. App. Div. 3d Dep't 2014).published “An application to quash a subpoena should be granted only where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry” (Anheuser-Bus…
- Carl Andrews & Assocs., Inc. v. Off. of Inspector Gen., 30 Misc. 3d 271 (N.Y. Sup. Ct. 2010).publishedDiscussion “An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious, or where the information sought is utterly irrelevant to any proper inquiry.…
- Roemer v. Cuomo, 67 A.D.3d 1169 (N.Y. App. Div. 3d Dep't 2009).publishedIt is well settled that an agency’s investigative subpoena should not be quashed unless “the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any prope…
- Hogan v. Cuomo, 67 A.D.3d 1144 (N.Y. App. Div. 3d Dep't 2009).published “An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry” (Anheuser-B…
- People v. Marcus Garvey Nursing Home, Inc., 57 A.D.3d 201 (N.Y. App. Div. 1st Dep't 2008).publishedCounty Lawyers’ Assn., 23 NY2d 916, 918 [1969], cert denied 395 US 959 [1969]), and except where “the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to…
- New York Temp. State Comm'n on Lobbying v. Crane, 49 A.D.3d 1066 (N.Y. App. Div. 3d Dep't 2008).publishedCounty Lawyers’ Assn., 23 NY2d 916, 918 [1969], cert denied 395 US 959 [1969]), a subpoena will be quashed “[o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is…
- Tech. Multi Sources, S.A. v. Stack Global Holdings, Inc., 44 A.D.3d 931 (N.Y. App. Div. 2d Dep't 2007).publishedNonetheless, “[a]n application to quash a subpoena should be granted ‘[o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious’ ... or where the information sought is ‘utterly irrelevant to any prope…
- Abbruzzese v. New York Temp. State Comm'n on Lobbying, 43 A.D.3d 518 (N.Y. App. Div. 3d Dep't 2007).published As noted by the Court of Appeals, “[a]n application to quash a subpoena should be granted only where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant…
- Irizarry v. Beltron, 6 A.D.3d 276 (N.Y. App. Div. 1st Dep't 2004).publishedInasmuch as the extent of respondent’s income has been placed at issue in this child support proceeding and there are compelling grounds to believe that during the years in question respondent received substantial income from nonparty appe…
- Oncor Commc'ns, Inc. v. State, 165 Misc. 2d 262 (N.Y. Sup. Ct. 1995).published "An application to quash a subpoena should be granted '[o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious,’ or where the information sought is 'utterly irrelevant to any * * * proper inquiry’ ”…
- George v. Victoria Albi, Inc., 148 A.D.3d 1119 (N.Y. App. Div. 2d Dep't 2017).published
- George v. Victoria Albi, Inc., 148 A.D.3d 1120 (N.Y. App. Div. 2d Dep't 2017).published
- Hudson City Sav. Bank v. 59 Sands Point, LLC, 153 A.D.3d 611 (N.Y. App. Div. 2d Dep't 2017).published
- Jamaica Wellness Med., P.C. v. USAA Cas. Ins., 49 Misc. 3d 926 (N.Y. City Civ. Ct. 2015).published
71 N.Y.2d at 332 Determining relevance for subpoena challenges under the Donnelly Act15 citing cases“a reasonable relation to the subject matter under investigation and to the public purpose to be achieved”
- Matter of Madison Sq. Garden Ent. Corp. v. New York State Liq. Auth., 2023 NY Slip Op 06090 (N.Y. App. Div. 1st Dep't 2023).publishedAnheuser-Busch, Inc. v Abrams , 71 NY2d 327, 332 [1988], citing General Business Law § 343; Matter of Levin v Murawski , 59 NY2d 35, 39 [1983]).
- Matter of People of the State of New York v. Trump Org., Inc., 2022 NY Slip Op 03456 (N.Y. App. Div. 1st Dep't 2022).published This sequence of events suggests that the investigation was lawfully initiated at its outset and well [*2]founded, apart from any parallel criminal investigation undertaken by the District Attorney ( see Anheuser-Busch, Inc. v Abrams , 71…
- Hyatt v. California Franchise Tax Bd., 105 A.D.3d 186 (N.Y. App. Div. 2d Dep't 2013).published The issuer must demonstrate that the materials sought have “a reasonable relation to the subject matter under investigation and to the public purpose to be achieved” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 332 [1988] [internal quotati…
- Hogan v. Cuomo, 67 A.D.3d 1144 (N.Y. App. Div. 3d Dep't 2009).published “An application to quash a subpoena should be granted [o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant to any proper inquiry” (Anheuser-B…
- Abbruzzese v. New York Temp. State Comm'n on Lobbying, 43 A.D.3d 518 (N.Y. App. Div. 3d Dep't 2007).published As noted by the Court of Appeals, “[a]n application to quash a subpoena should be granted only where the futility of the process to uncover anything legitimate is inevitable or obvious or where the information sought is utterly irrelevant…
- Brasky v. City of New York Dep't of Investigation, 40 A.D.3d 531 (N.Y. App. Div. 1st Dep't 2007).publishedIn the circumstances, DOI met the threshold of showing that this complaint was authentic and of sufficient substance to warrant investigation (see Levin, 59 NY2d at 41 ; Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 332 [1988]).
- N. v. Novello, 13 A.D.3d 631 (N.Y. App. Div. 2d Dep't 2004).publishedThe issuing agency need only establish that the material sought bears a reasonable relation to the matter under investigation (see Matter of Abrams v Thompson, 150 AD2d 679, 680 [1989]), and the subpoena will be upheld unless the informati…
- New York State Supreme Court Officers Ass'n v. New York State Unified Court Sys., 2 Misc. 3d 960 (N.Y. Sup. Ct. 2004).publishedHowever, a very high standard governs an irrelevancy determination given the principle that quashing a subpoena results “where the information sought is ‘utterly irrelevant to any proper inquiry’ ” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 3…
- Matter of New York State Supreme Ct. Officers Assn. v. New York State Unified Ct. Sys. (N.Y. Sup. Kings 2004).publishedHowever, a very high standard governs an irrelevancy determination given the principle that quashing a subpoena results "where the information sought is 'utterly irrelevant to any proper inquiry' " ( Anheuser-Busch, Inc. v Abrams , 71 NY2d…
- Oncor Commc'ns, Inc. v. State, 165 Misc. 2d 262 (N.Y. Sup. Ct. 1995).published "An application to quash a subpoena should be granted '[o]nly where the futility of the process to uncover anything legitimate is inevitable or obvious,’ or where the information sought is 'utterly irrelevant to any * * * proper inquiry’ ”…
Show 2 more citing cases
- New York City Dep't of Investigation v. Passannante, 148 A.D.2d 101 (N.Y. App. Div. 1st Dep't 1989).publishedAlthough we find that the Commissioner of DOI, like this State’s Attorney-General, when defending a subpoena duces tecum he or she has issued, which is challenged by a motion to quash, "enjoys a presumption that he [or she] is acting in go…
- Matter of People of the State of New York v. VDARE Found., Inc., 2024 NY Slip Op 00819 (N.Y. App. Div. 1st Dep't 2024).published
71 N.Y.2d at 335 Interpreting state antitrust law in light of federal precedent6 citing cases“should generally be construed in light of federal precedent”
- Global Reinsurance Corp.-U.S. Branch v. Equitas Ltd., 82 A.D.3d 26 (N.Y. App. Div. 1st Dep't 2011).published Legal analysis of that argument begins with the precept that the provisions of the Donnelly Act “should generally be construed in light of Federal precedent and given a different interpretation only where State policy, differences in the s…
- People v. Liberty Mut. Ins., 52 A.D.3d 378 (N.Y. App. Div. 1st Dep't 2008).publishedFurthermore, “the Donnelly Act . . . should generally be construed in light of Federal [antitrust] precedent” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 335 [1988]), and because bid-rigging is an activity that is inherently one of fraudu…
- Sperry v. Crompton Corp., 863 N.E.2d 1012 (N.Y. 2007).publishedAlthough we generally construe the Donnelly Act in light of federal antitrust case law, it is also well settled that we will interpret our statute differently “where State policy, differences in the statutory language or the legislative hi…
- George C. Miller Brick Co. v. Stark Ceramics, Inc., 9 Misc. 3d 151 (N.Y. Sup. Ct. 2005).published There appears to be no reason, however, why state antitrust cases should be treated differently than federal antitrust cases in this regard (see Anheuser-Busch, 71 NY2d at 335 [the Donnelly Act is “construed in light of Federal precedent a…
- Lennon v. Philip Morris Companies, 189 Misc. 2d 577 (N.Y. Sup. Ct. 2001).published The Donnelly Act is often referred to as the “Little Sherman Act” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 335 [1988]).
- Global Reinsurance Corp. v. Equitas Ltd, 969 N.E.2d 187 (N.Y. 2012).published
520 N.E.2d at 539 “The Donnelly Act — often called a ‘Little Sherman Act’ — should generally be construed in light of Federal precedent and given a different interpretation only where State policy, differences in statutory language or the legislative history justify such a result”2 citing cases
- In re Packaged Seafood Prods. Antitrust Litig., 242 F. Supp. 3d 1033 (S.D. Cal. 2017).published Anheuser-Busch, Inc. v. Abrams, 71 N.Y.2d 327 , 525 N.Y.S.2d 816 , 520 N.E.2d 535, 539 (1988).
- Volmar Distributors, Inc. v. New York Post Co., Inc., 825 F. Supp. 1153 (S.D.N.Y. 1993).published“The Donnelly Act — often called a ‘Little Sherman Act’ — should generally be construed in light of Federal precedent and given a different interpretation only where State policy, differences in statutory language or the…”
71 N.Y.2d at 333 “We conclude, however, that the cases cited by petitioners do not conclusively establish, either singly or in combination, a rule of per se legality for vertical territorial arrangements.”3 citing cases
- Taxi Tours v. Go New York Tours , Go New York Tours v. Big Bus Tours Ltd., 41 N.Y.3d 991 (N.Y. 2024).publishedAlthough sparse, these factual assertions and all the possible inferences to be drawn therefrom are sufficient to allege concerted action between two or more entities and support a cognizable Donnelly Act counterclaim under our liberal not…
- Radon Corp. of Am., Inc. v. Nat'l Radon Saf. Bd., 125 A.D.3d 1537 (N.Y. App. Div. 4th Dep't 2015).published Instead, as construed by State and Federal courts, the antitrust laws prohibit only ‘unreasonable’ restraints on trade” (Anheuser-Busch, Inc. v Abrams, 71 NY2d 327, 333 [1988]).
71 N.Y.2d at 334 Petitioners’ efforts to extract a rule of per se legality from the case law dealing with vertical territorial arrangements are unavailing for several reasons.…2 citing cases
- Geoffrey Desrosiers v. Perry Ellis Menswear , Christopher Vasquez v. Nat'l Sec. Corp., No. 121-122 (N.Y. Dec. 12, 2017).published Granted, the persuasive significance of legislative inaction in this context carries more weight where the legislature has amended the statute after the judicial - 10 - - 11 - Nos. 121-122 interpretation but its amendments "do not alter th…
- Preston Hollow Capital LLC v. Nuveen LLC, No. CA No. 2019-0169-SG, 2020 WL 1814756 (Del. Ch. Apr. 9, 2020).published
520 N.E.2d at 538 “construed in light of federal precedent and given a different interpretation only where State policy, differences in the statutory language or the legislative history justify such a result”1 citing case
- Clorox Co. v. Winthrop, 836 F. Supp. 983 (E.D.N.Y 1993).published“construed in light of federal precedent and given a different interpretation only where State policy, differences in the statutory language or the legislative history justify such a result”
525 N.Y.S.2d at 820 cited at this page1 citing case
- Re-Alco Indus., Inc. v. Nat'l Ctr. for Health Educ., Inc., 812 F. Supp. 387 (S.D.N.Y. 1993).published Anheuser-Busch, Inc. v. Abrams, 71 N.Y.2d 327, 335 , 520 N.E.2d 535, 539 , 525 N.Y.S.2d 816, 820 (1988).
71 N.Y.2d at 327 “We hold that General Business Law § 343 authorizes the Attorney-General to investigate the practice in question and that it was error, therefore, to quash the subpoenas and interrogatories.”1 citing case
- Starr Indem. & Liab. Co. v. Monte Carlo, LLC, 2025 NY Slip Op 50527(U) (N.Y. Sup. Ct., New York Cty. 2025).unpublished Neither does the record establish that compliance with the subpoena would be 'futile' or would otherwise lead to the disclosure of irrelevant information ( Anheuser-Busch, Inc., 71 NY2d at 327 [a motion to quash a subpoena should be grante…
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- Dorman v. Luva of NY, LLC, 2025 NY Slip Op 06155 (N.Y. App. Div. 2d Dep't 2025).published
- 8206 N. Blvd, LLC v. Ai Qiu Qu, 2024 NY Slip Op 05949 (N.Y. App. Div. 2d Dep't 2024).published
v.
Robert Abrams, as Attorney-General of the State of New York, Appellant In the Matter of Subpoenas Duces Tecum Served by the Attorney-General of the State of New York, Upon the New York State Beer Wholesalers Association, Inc., Respondents Attorney-General of the State of New York, Appellant In the Matter of G. Heileman Brewing Company, Inc. v. Robert Abrams, as Attorney-General of the State of New York, Appellant In the Matter of Miller Brewing Company v. Robert Abrams, as Attorney-General of the State of New York, Appellant In the Matter of Stroh Brewery Company v. Robert Abrams, as Attorney-General of the State of New York, Appellant In the Matter of Forbee Bros. Corporation v. Robert Abrams, as Attorney-General of the State of New York
Lead Opinion
OPINION OF THE COURT
Chief Judge Wachtler.The petitioners — four brewers, several beer wholesalers and a beer wholesalers’ trade association — brought these proceedings to quash subpoenas duces tecum and interrogatories served upon them by the Attorney-General pursuant to an investigation into marketing practices in the beer industry which the Attorney-General alleges may violate the State’s antitrust laws. The central issue posed by this appeal, here by leave of the Appellate Division,[1] is whether that court properly granted the applications on the ground that the focus of the investigation is an activity which is per se legal under State law and therefore beyond the scope of the Attorney-General’s investigatory powers.
We hold that General Business Law § 343 authorizes the Attorney-General to investigate the practice in question and that it was error, therefore, to quash the subpoenas and interrogatories.
[*331] I.
The subpoenas and interrogatories now challenged were issued to the petitioners beginning in May 1985 as part of an investigation by the Attorney-General into the pervasive use in the beer industry of exclusive territorial distributorships. The Attorney-General alleges — and petitioners do not dispute for purposes of these proceedings — that since 1982 brewers and wholesaler distributors have entered into agreements establishing exclusive territorial rights to sell each brewer’s products to retail outlets. According to the Attorney-General, under this scheme, the brewer agrees to sell its products to only one designated wholesaler in a given territory and that wholesaler, in turn, agrees not to sell the brewer’s products outside that territory or to anyone inside the territory who would resell the products elsewhere. The aim of these agreements, allegedly, is to eliminate intrabrand competition by "transshippers”, independent wholesalers who, prior to the advent of these agreements, could buy beer from a franchised wholesaler in one territory and sell it in another territory, in competition with another franchised wholesaler.
The parties agree that, to the extent that this arrangement results in a restraint of trade, it is a "vertical” restraint — that is, one imposed by an agreement between noncompetitors who occupy different levels in the distribution chain — as opposed to a "horizontal” restraint, which results from an agreement among competitors at the same level of distribution. The Attorney-General contends that, although such vertical restraints are not per se illegal under New York’s antitrust law (the Donnelly Act; General Business Law § 340 et seq.), they may be found to be illegal if, under all the circumstances, they impose an unreasonable restraint on competition. Petitioners concede that the "rule of reason” analysis urged by the Attorney-General would be employed to determine if the practice violates Federal antitrust law (see, e.g., Continental T. V. v GTE Sylvania, 433 US 36), but they argue that the courts of this State have ruled that such vertical restraints are per se legal under the Donnelly Act. Accordingly, they conclude, the Attorney-General lacks authority to conduct an investigation designed to facilitate a rule of reason analysis of the brewing industry practice.
II.
An application to quash a subpoena should be granted "[o]nly where the futility of the process to uncover anything[*332] legitimate is inevitable or obvious” (Matter of Edge Ho Holding Corp., 256 NY 374, 382) or where the information sought is " 'utterly irrelevant to any proper inquiry’ ” (Matter of La Belle Creole Intl., S. A. v Attorney-General of State of N. Y, 10 NY2d 192, 196, quoting Matter of Dairymen’s League Coop. Assn. v Murtagh, 274 App Div 591, 595, affd 299 NY 634). In defending his inquiry, the Attorney-General enjoys a presumption that he is acting in good faith (Matter of Ryan v Lefkowitz, 26 AD2d 604, affd 18 NY2d 977) and must show only that the materials sought bear "a reasonable relation to the subject matter under investigation and to the public purpose to be achieved” (Carlisle v Bennett, 268 NY 212, 217; see also, Virag v Hynes, 54 NY2d 437, 442; Matter of Goldin v Greenberg, 49 NY2d 566, 572; Matter of La Belle Creole Intl., S. A. v Attorney-General of State of N. Y, supra, at 196).
Thus, the precise question presented by these proceedings is brought into focus. The question is not whether all vertical restraints of this type should, in the context of these proceedings, be declared legal per se or, on the other hand, subject to a rule of reason analysis. Instead, the question is whether the Attorney-General has authority under the Donnelly Act to issue the subpoenas and interrogatories challenged here, a question which must be answered in the affirmative unless the legality of the brewers’ marketing practice is so well established, either by the plain language of the statute or by existing judicial interpretation, as to be free from doubt. If the legality of the brewing industry’s vertical restraints is arguable, then the subpoenas issued pursuant to the Attorney-General’s broad powers to investigate possible violations of the Donnelly Act (see, General Business Law § 343)[2] must be sustained (see, Matter of Nicholson v State Commn. on Judicial Conduct, 50 NY2d 597, 610-611).
Petitioners effectively concede as much, because the focus of their argument is not that we should announce a rule of per[*333] se legality, but rather that such a rule has already been established by "seven decades of unanimous precedent” and that the Legislature has acquiesced in such an interpretation of the Donnelly Act by failing to amend the statute to overrule those decisions. We conclude, however, that the cases cited by petitioners do not conclusively establish, either singly or in combination, a rule of per se legality for vertical territorial arrangements. Nor does the statutory language foreclose the Attorney-General’s position that such arrangements, if shown to result in an unreasonable restraint of trade under the circumstances, are prohibited.
III.
The Donnelly Act declares, among other things, that "[e]very contract, agreement, arrangement or combination whereby * * * [competition or the free exercise of any activity in the conduct of any business, trade or commerce or in the furnishing of any service in this state is or may be restrained [is] against public policy, illegal and void” (General Business Law § 340 [1]). This language is clearly broad enough, on its face, to encompass the vertical restraints in issue. There is no dispute for present purposes that the target of the Attorney-General’s investigation — exclusive territorial distributorships — restricts intrabrand competition in the beer industry.
We recognize that neither the Donnelly Act nor the Sherman Act, after which it was modeled, has been interpreted as prohibiting every agreement that has the effect of restraining trade, no matter how minimal. Instead, as construed by State and Federal courts, the antitrust laws prohibit only "unreasonable” restraints on trade (see, Northern Pac. Ry. Co. v United States, 356 US 1, 5; Atkin v Union Processing Corp., 90 AD2d 332, affd 59 NY2d 919, cert denied 465 US 1038). Even in light of this general judicial gloss, however, the statutory language easily accommodates the Attorney-General’s position that petitioners’ practice may be prohibited if it can be shown to be unreasonable.[3]
[*334] Petitioners’ efforts to extract a rule of per se legality from the case law dealing with vertical territorial arrangements are unavailing for several reasons. First, the issue of per se legality of all vertical territorial arrangements was not presented in the cases cited by petitioners. In Dawn to Dusk v Brunckhorst Co. (23 AD2d 780 [2d Dept]), Stemmerman v Kelly (150 App Div 735 [1st Dept], judgment after remand affd no opn 163 App Div 892, affd no opn 220 NY 756), and Revlon Prods. Corp. v Bernstein (204 Misc 80, affd no opn 285 App Div 1139 [1st Dept]), the issue before the courts was the legality, under specific circumstances, of specific arrangements. The courts decided no more than that those arrangements did not constitute unreasonable restraints of trade.
For example, in Stemmerman (supra), the Appellate Division held that the trial court had erred in declaring the contract void without allowing the plaintiff to introduce proof tending to show the limited impact of the territorial restriction on the asphalt market — evidence relevant to a rule of reason analysis. Thus, the decision did not establish a rule of per se legality; it simply rejected the trial court’s rule of per se illegality. The Revlon Prods, (supra) decision is open to a similar interpretation (see, Robinson, Restraints on Trade and the Orderly Marketing of Goods, 45 Cornell LQ 254, 261, n 32; 263, n 40) and, in any event, was colored by the defendant’s concession that the restriction in question did not restrain trade (see, 204 Misc, at 81, supra).
In addition, this court, the final arbiter of questions of State law, did not issue or pass directly upon any of the decisions cited for the proposition advanced by petitioners. Nor do these isolated decisions from two judicial departments represent the kind of unanimous judgment of the intermediate appellate courts deserving of similar weight (cf., Matter of Knight-Ridder Broadcasting v Greenberg, 70 NY2d 151). Thus, even if the cited decisions unequivocally supported petitioners’ contention, we would not be persuaded that legislative inaction should be interpreted as acquiescence (see, Matter of Hellerstein v Assessor of Town of Islip, 37 NY2d 1, 9-10).
Finally, such a tenuous inference is even less compelling in this case, because it would result in an interpretation of the Donnelly Act at odds with the settled interpretation of its[*335] Federal counterpart. Although we do not move in lockstep with the Federal courts in our interpretation of antitrust law (see, People v Roth, 52 NY2d 440), the Donnelly Act — often called a "Little Sherman Act” — should generally be construed in light of Federal precedent and given a different interpretation only where State policy, differences in the statutory language or the legislative history justify such a result (see, State of New York v Mobil Oil Corp., 38 NY2d 460, 463; Matter of Aimcee Wholesale Corp. [Tomar Prods.], 21 NY2d 621, 626; Givens, Practice Commentaries, McKinney’s Cons Laws of NY, Book 19, General Business Law § 340, 1988 Cum Ann Pocket Part, at 182). Thus, we should not be eager to find that a contrary State rule has been established by a combination of equivocal pronouncements from the lower courts and legislative inaction in response to such decisions.
IV.
We conclude, therefore, that no rule of per se legality must inexorably be gleaned from the case law or the statutory language. In the absence of such a rule, we hold that the Attorney-General is authorized to conduct an investigation to test the legality of petitioners’ practices. In addition, we find no merit to petitioners’ alternative argument that the subpoenas must be quashed because the Attorney-General has commenced a civil action in Federal court, charging them with violations of the Sherman and Donnelly Acts. Section 343 specifically provides that the Attorney-General’s subpoena power does not abate by reason of any action or proceeding brought by him (see, Matter of Grandview Dairy v Lefkowitz, 76 AD2d 776, 777; State of New York v Mobil Oil Corp., 40 AD2d 369, affd 33 NY2d 627).
Accordingly, the order of the Appellate Division should be reversed and the judgments of Supreme Court reinstated.
The Appellate Division also certified the following question: "Was the order of this Court, which reversed the six judgments (denominated orders) of the Supreme Court, properly made?” Because the order appealed from finally determines these special proceedings (see, Matter of Abrams [Anonymous], 62 NY2d 183, 192), the certified question was unnecessary and need not be answered.
Pertinent language from General Business Law § 343, the provision which confers investigatory powers on the Attorney-General, illustrates the broad scope of that authority. The statute authorizes an investigation "[wjhenever it shall appear to the attorney general * * * that any person or persons, partnership, corporation, company, trust or association shall have engaged in or engages in or is about to engage in any act or practice by this article [the Donnelly Act] prohibited or declared to be illegal, or * * * has assisted or participated in any plan, scheme, agreement or combination of the nature described herein, or whenever he believes it to be in the public interest that an investigation be made”. That such an investigation may include the use of subpoenas and interrogatories is not disputed here.
Thus, the dissent’s major premise — that the Donnelly Act does not expressly declare the brewers’ practice to be illegal — is flawed. The Act, by its very broad terms, declares all restraints on trade to be illegal'; it is only by judicial interpretation that some practices have been held to be outside the act’s scope. And, as noted above (supra, at 332, n 2), the Attorney-General’s investigatory powers are equally broad. Thus, our decision to[*334] allow this investigation to proceed does not, as the dissent suggests, depend on the kind of extrapolation of legislative intent that we resisted in CPC Intl, v McKesson Corp. (70 NY2d 268).
Dissent
(dissenting). I vote to affirm. The investigatory and enforcement powers of the Attorney-General under the Donnelly Act should not be expanded by judicial construction to include vertical restraints, as that is a policy choice and authorization uniquely reserved to the legislative branch (compare, Boreali v Axelrod, 71 NY2d 1).
The Donnelly Act (General Business Law § 340 et seq.) does not expressly declare illegal or prohibit vertical restraint agreements establishing exclusive territorial distributorships between noncompetitors in different positions in the distribu[*336] tion chain, nor does it vest authority in the Attorney-General to investigate and prosecute such commercial arrangements. The courts of this State have never, up to now, found such a prohibition or power even by implication in the provisions of the act. Indeed, the opposite has prevailed over many years. Moreover, the Legislature has evidenced its acquiescence in these decisions by repeatedly refusing to adopt legislation sought by the Attorney-General restricting vertical restraints and granting that office such enforcement powers. Most pertinently, the Legislature has even specifically refused to adopt legislation prohibiting vertical distribution agreements between brewers and beer wholesalers.
The determination of the issue as to whether the Attorney-General has the authority to issue the subpoenas and interrogatories which respondents seek to quash necessarily hinges upon whether vertical restraint agreements creating exclusive territorial distributorships are prohibited or illegal under the Donnelly Act, not whether the legality of such arrangements is "arguable”, as suggested by the majority. Such a tenuous predicate for the issuance of formal, duplicative and burdensome investigatory process by the chief law enforcement officer of the State should not be countenanced by this court.
General Business Law § 340, "[t]he determinative provision of the Donnelly Act” (State of New York v Mobil Oil Corp., 38 NY2d 460, 462), provides that "[ejvery contract, agreement, arrangement or combination whereby * * * [a] monopoly * * * is or may be established or maintained, or whereby [cjompetition * * * is or may be restrained * * * is hereby declared to be against public policy, illegal, and void”. The act authorizes the Attorney-General to bring actions "to restrain and prevent the doing in this state of any act herein declared to be illegal” or prohibited (General Business Law § 342). In the performance of these enforcement responsibilities, the Attorney-General is empowered to investigate any person or business enterprise who is or is about to be engaged in any act "by this article prohibited or declared to be illegal”; who "assisted or participated” in any such act; or "whenever he believes it to be in the public interest that an investigation be made” (General Business Law § 343). The investigation provisions of section 343 do not create new categories of illegal or prohibited acts, but merely provide when and how an investigation should be effectuated.
In Marsich v Eastman Kodak Co. (244 App Div 295, affd 269[*337] NY 621), this court affirmed a decision upholding the right of a producer and its dealers to refuse to sell their product to one who violated a price scale established by the producer. The court distinguished that situation from one where the agreement was between several manufacturers or producers which would be covered under General Business Law § 340. It stated that "[t]he soundness of the economic theories embodied in such a statute is a legislative question, and the courts may not obtrude their economic theories into a statute under the guise of interpreting it” (id., at 296 [emphasis supplied]). Similarly, in Stemmerman v Kelly (150 App Div 735, affd 220 NY 756), we affirmed a decision upholding a vertical restraint agreement establishing a sole source distributorship within an exclusive territory. The court there noted that "there may lawfully be a partial restraint of trade, sufficient to protect the interests of a party and not so great as to interfere with the interests of the public” (id., at 738; see also, Alexander’s Dept. Stores v Ohrbach’s, Inc., 266 App Div 535, appeal dismissed 291 NY 707).
The most direct and recent pronouncement on the legal propriety under State law of vertical restraint agreements concerning exclusive territorial distributorships arose in Dawn to Dusk v Brunckhorst Co. (23 AD2d 780). The manufacturer’s exclusive distributor and the exclusive subdistributor within a designated area refused to sell to the plaintiff because the latter refused to deal solely through the subdistributor. Relying upon General Business Law § 340, the court noted that "[n]ot every agreement or combination which is in restraint of trade is proscribed by the statute” (id., at 781), and specifically held "[a]n agreement or arrangement among parties in a vertical relationship, which restricts the territory within which the buyer, here the defendant jobber Vaccaro, may resell the goods in question does not violate section 340 of the General Business Law” (id., at 781 [citations omitted]).
Against the backdrop and long history of the statute and cases interpreting it, the court now discerns an implied power for the Attorney-General to investigate and litigate against vertical restraints. Recently, we rejected just such an analysis seeking to create by implication a private action under the Martin Act (see, CPC Intl. v McKesson Corp., 70 NY2d 268, 276-277). In direct contradiction of our past opinions on the Donnelly Act that a "ruling of a Federal court interpreting a Federal statute has no direct bearing upon a State court’s analysis of an analogous provision enacted by the State Legis[*338] lature” (People v Roth, 52 NY2d 440, 447; see also, State of New York v Mobil Oil Corp., 38 NY2d 460, 463, supra; and Marsich v Eastman Kodak Co., 244 App Div 295, affd 269 NY 621, supra), the majority relies upon Federal court precedents interpreting the Sherman Antitrust Act and borrows their "rule of reason” analysis from that quite different and explicit statute. Surely, had the New York State Legislature deemed that our State court "decisions gave to the statute [Donnelly Act] a meaning or scope different from that [originally] intended, it would have amended the statute as to give it the effect intended”, especially since it was specifically importuned to do so (Marsich v Eastman Kodak Co., 244 App Div 295, 297, affd 269 NY 621, supra). In fact, the Attorney-General has made the effort to align the requirements of the Donnelly Act with those of the Sherman Antitrust Act and "has sought to obtain procedural tools comparable to those available under federal law” because of "the absence of a state per se rule and * * * vertical restraints” (Givens, Practice Commentaries, McKinney’s Cons Laws of NY, Book 19, General Business Law § 340, 1988 Cum Ann Pocket Part, at 187). He is even in this very matter litigating the same subject under Federal law in the Federal courts.
At least seven recent bills would, in varying degrees, have restructured the Donnelly Act (see, Bill No. S. 8399 [introduced 1986]; Bill No. A. 5835 [introduced 1985]; Bill No. A. 1876 [introduced 1985]; Bill No. S. 420 [introduced 1985]; Bill No. A. 6055 [introduced 1984]; Bill No. S. 5121 [introduced 1984]; and Bill No. S. 1591 [introduced 1984]). New and modified provisions directly relevant to this case would have mandated that State courts "give due consideration and great weight” to the Federal courts’ interpretations of Federal antitrust statutes specifically including the Sherman and Clayton Antitrust Acts, and "to the per se doctrine to restraints of trade” (see, e.g., Bill No. S. 8399 [introduced 1986]). Other changes would have provided the Attorney-General greater investigatory and enforcement powers and would have made it a specific violation to allocate customers or markets functionally or geographically. Five bills directly and particularly regulating vertical restraints in the malt beverage industry, explicitly declaring such agreements unlawful and empowering the Attorney-General to investigate and litigate such restraints, were rejected (Bill No. A. 5754 [introduced 1985]; Bill No. A. 4077 [introduced 1985]; Bill No. S. 2325 [introduced[*339] 1985]; Bill No. A. 4284 [introduced 1983]; Bill No. S. 2668 [introduced 1983]).
All extant judicial construction of General Business Law § 340 refused to prohibit vertical restraint agreements; yet, the Legislature on no less than 12 occasions refused to change that and rejected bills to give the Attorney-General the very power now conferred.
In Matter of Knight-Ridder Broadcasting v Greenberg (70 NY2d 151), this court used the unanimity of precedents in all four Appellate Divisions construing the Shield Law statute (Civil Rights Law § 79-h) as protecting only confidential news sources, coupled with subsequent failed legislative efforts to amend the statute to broaden the privilege, as "compellingly persuasive evidence” (id., at 159) that the Legislature did not intend that such a broad privilege should exist. The court said that legislative history must be "reviewed in light of the existing decisional law which the Legislature is presumed to be familiar with and to the extent it left it unchanged, that it accepted” that decisional law (id., at 157, citing Arbegast v Board of Educ., 65 NY2d 161, 169; Hammelburger v Foursome Inn Corp., 54 NY2d 580, 588; Engle v Talarico, 33 NY2d 237, 242). Building on this reasoning, in Boreali v Axelrod (71 NY2d 1, supra) the court relied, in part, upon negative legislative history, resulting from some 40 failed efforts to expand the prohibitions against smoking in public places (see, Public Health Law art 13-E), as evidence that the New York Public' Health Council had exceeded the scope of its broad authority to protect the public health by promulgating regulations limiting smoking in certain public places.
If the executive branch, under the separation doctrine, must respect the legislative branch prerogatives and history in a particular area, so must the judicial branch. Conflicting and selective applications of recently announced principles by this court do not well serve the judicial process and its purposes. I would affirm and quash the subpoenas.
Judges Simons, Alexander, Titone and Hancock, Jr., concur with Chief Judge Wachtler; Judge Bellacosa dissents and votes to affirm in a separate opinion; Judge Kaye taking no part.
Order reversed, with costs, and the judgments of Supreme Court, New York County, reinstated. Certified question not answered as unnecessary.