Opinion · Supreme Court of the United States
United Leather Workers International Union, Local Lodge or Union No. 66 v. Herkert & Meisel Trunk Co.
United Leather Workers Int’l Union, Loc. Lodge or Union No. 66 v. Herkert & Meisel Trunk Co., 265 U.S. 457 (1924)
- Type
- Opinion
- Court
- Supreme Court of the United States
- Jurisdiction
- Federal
- Date
- 1924-06-09
- Topic
- general
*461 Mr. Chief Justice Taft delivered the opinion of the Court. This suit was begun by a bill in equity filed in the District Court for the Eastern District of Missouri by the Herkert & Meisel Trunk Company and four others, all corporations of Missouri, engaged in making trunks and leather goods in St. Louis, against the United Leather Workers Union, Local Lodge or Union No. 66, an unincorporated association, its officers and agents and a number of its members. The bill averred that each of the complainants had built up a valuable business in making, selling and shipping in interstate commerce trunks and leather goods, that each received large quantities of raw material by interstate commerce, and employed a large *462 number of persons, men and girls, that on February 28, 1920, defendants demanded that their shops be unionized and conducted as closed shops and announced that if complainants refused they would ruin the interstate commerce business of each of them, that on April 10,1920, the defendants, acting individually and on behalf of the defendant union, in order to destroy the complainants’ business and to prevent their employees from continuing in their employment unless complainants would yield to their demands, began a strike, assaulted and threatened complainants’ employees, and intimidated them so as to force them against their wills to quit complainants’ employment, and that they thereby prevented complainants from engaging in and carrying on their interstate busi…
Citator
United Leather Workers International Union, Local Lodge or Union No. 66 v. Herkert & Meisel Trunk Co. has been questioned or limited by later authorities: relies on overruled authority: 38 S. Ct. 529 (overruled by Smith v. Allwright). Read them before relying on it. 103 later decisions cite it.
- Authority status
- caution
- Cited by
- 103 opinions
Headnotes
- Antitrust & Competition Law — Restraint of Interstate Commerce — Labor Strikes A strike by employees intended, through illegal picketing and intimidation, to prevent the continued manufacture of goods by their employer, and having that effect, is not a conspiracy to restrain interstate commerce under the Anti-Trust Act, even though the strikers know the products when made are to be shipped in interstate commerce to fill orders already received from customers in other States, provided there is no actual or attempted interference with the free transport of the products from the factory to their destination in other States, or with their sale in those States. 265 U.S. at 464
- Antitrust & Competition Law — Restraint of Interstate Commerce — Reduction of Supply by Preventing Manufacture The mere reduction of the supply of an article to be shipped in interstate commerce, by illegal and tortious prevention of its manufacture, is ordinarily an indirect and remote obstruction to that commerce; only where the intent or necessary effect is to enable those preventing the manufacture to monopolize the supply, control its price, or discriminate among would-be purchasers is the unlawful interference with manufacture a direct burden on interstate commerce. 265 U.S. at 471
- Antitrust & Competition Law — Restraint of Interstate Commerce — Intent to Monopolize Obstruction to mining or manufacture, though it may prevent the product from going into interstate commerce, is not a restraint of that commerce unless the obstruction is intended to restrain commerce in the product or has necessarily such a direct, material, and substantial effect to restrain it that the intent reasonably must be inferred. 265 U.S. at 471 (quoting United Mine Workers v. Coronado Co., 259 U.S. 344, 410)
UNITED LEATHER WORKERSv. HERKERT,265 U.S. 457(1924)
44 S.Ct. 623
UNITED LEATHER WORKERS INTERNATIONAL UNION, LOCAL LODGE OR UNION NO. 66, ET
AL.v. HERKERT MEISEL TRUNK COMPANY ET AL.
APPEAL FROM THE CIRCUIT COURT OF APPEALS FOR THE EIGHTH CIRCUIT.
No. 233.
Argued April 24, 25, 1924.
Decided June 9, 1924.
APPEAL from a decree of the Circuit Court of Appeals which
affirmed a final decree of the District Court, granting an
injunction in a suit by divers manufacturers of trunks and
leather goods against striking employees and labor unions.
The formation of this conspiracy, and the acts done in pursuance thereof, were violative of the Anti-Trust Act, because a direct restraint was intended and placed upon the interstate business of the plaintiffs.
To accomplish this destruction the defendants had a choice of means available. They could have boycotted plaintiffs' goods in the hands of their customers. This would have been more difficult and less effective. Or they could have attempted to prevent the transfer companies from hauling plaintiffs' goods to the railroads for shipment. This they were probably not strong enough to do, and besides, such a course would have brought them into more certain conflict with the police. Or they could do, as they did do, assault and abuse those who desired to continue at work, and those who sought employment with plaintiffs, and thereby prevent plaintiffs' factories from operating. This latter was the easiest, safest andPage 459most certain method of destroying plaintiffs' business. It was completely successful.
The evidence conclusively established the existence of the conspiracy to destroy plaintiffs' interstate business, and the unlawful means charged. Two courts have so found. SeeWashingtonSecurities Co. v.United States,234 U.S. 76.
Is a conspiracy to destroy an established interstate business, by preventing the manufacture of goods which are being sold and shipped in such interstate business, prohibited by the Sherman Act?
InEastern States Lumber Dealers' Assn. v.United States,234 U.S. 600, this Court said: "It [the Sherman Act] broadly condemns all combinations and conspiracies which restrain the free and natural flow of trade in the channels of interstate commerce."
The purpose of § 1 of the act was to prevent any direct and unreasonable interference with interstate commerce. It condemns any plan, scheme or device, adopted as a part of a combination or conspiracy which has that effect.Eastern States Lumber Assn. v.United States,234 U.S. 600;Northern Securities Co. v.United States,193 U.S. 197;United Statesv.Reading Co.,226 U.S. 324.
The deduction to be made from these cases is that the Sherman Act will reach any act, however remote (standing alone) it may be from interstate commerce, if it is made an effective part of a combination to restrict such commerce.
The pertinency of these cases is made to appear when the reasoning of the appellants in this case is kept in mind. Their reasoning may be roughly stated thus:
The Sherman Act deals only with interstate commerce. Manufacture is not interstate commerce. Therefore, the Sherman Act is not concerned with the stoppage of manufacture. With equal propriety might the defendants in theNorthern Securities Co.Casehave reasoned: ThePage 460Sherman Act deals only with interstate commerce. The purchase of shares of stock of interstate railroads is not commerce. Therefore, the Sherman Act has no concern with such purchase.
The comprehensiveness of the Sherman Act is no longer a question. It forbids any means by which a combination or a conspiracy may seek to restrict interstate commerce. If stoppage of manufacture is resorted to as such a means, the act prohibits it.Pennsylvania Sugar Refg. Co. v.American Sugar Refg. Co., 166 F. 254;American Column Co. v.United States,257 U.S. 377;Loewev.Lawlor,208 U.S. 274;United Statesv.Workingmen's Council, 54 F. 994;United Statesv.Elliott, 62 F. 801;Thomasv.Railway, 62 F. 803;United Statesv.Debs, 64 F. 724.
InLoewev.Lawlor,208 U.S. 274, the boycott was directed at the manufacturers' goods after transportation had ended and the hats had lost their status as a part of interstate commerce. They were boycotted as a means of destroying the interstate business of the manufacturers. The means employed operated at one end, after transportation ceased. In this case they operated at the other end, before transportation commenced. The purpose in each case was identical.
SeeDuplex Co. v.Deering,254 U.S. 443;Staffordv.Wallace,258 U.S. 495;United Statesv.Ferger,250 U.S. 199;Lamarv.United States, 260 F. 561; s.c.250 U.S. 673.
The conspiracy inUnited Mine Workersv.Coronado Co.,259 U.S. 344, was between the union coal operators and the International Union to restrain interstate commerce in coal and to monopolize it. As pointed out by Judge Sanborn, in the court below, the conspiracy alleged and proved in the present case is entirely different from that involved in theCoronado Case.
InHammerv.Dagenhart,247 U.S. 251, the restrictions placed on the manufacture of the goods had absolutelyPage 461no effect upon the goods themselves or upon the commerce into which they flowed, and the sole purpose of the act was to regulate the employment of children within the State.
In the present case the restraint imposed was not negligible; it was complete as to all commerce flowing from St. Louis in this particular line. It was not an indirect and incidental restraint on interstate commerce. The conspiracy charged was one to destroy this interstate business. The destruction of this business was the direct object of the conspiracy. Both the District Court and the Court of Appeals have so found. Such being its object, it cannot be said that the restraint was incidental. The stoppage of plaintiffs' interstate commerce by the means employed in this case was just as effectively a restraint upon interstate commerce, and just as violative of the Sherman Act, as would be the act of plaintiffs' competitors in Chicago, for instance, should they, for the purpose of destroying competition, purchase the stock of the plaintiff companies and by their control, thus secured, stop the manufacture of all goods in plaintiffs' factories.
The evidence adduced before the District Court showed that the defendant, the Local Union No. 66 of the United Leather Workers, having declared a strike against the complainants and withdrawn its members from their employ, instituted an illegal picketing campaign of intimidation against their employees who were willing to remain and against others willing to take the places of the striking employees, that the effect of this campaign was to prevent the complainants from continuing to manufacture their goods needed to fill the orders they had received from regular customers and would-be purchasers in other States, that such orders covered ninety per cent. of all goods manufactured by complainants, that the character of their business was known to the defendants, and that the illegal strike campaign of defendants thus interfered with and obstructed complainants' interstate commerce business to their great loss. There was no evidence whatever to show that complainants were obstructed by the strike or the strikers in shipping to other States the products they had ready to ship or in their receipt of materials from other States needed to make their goods. While the bill averred that defendants had instituted a boycott against complainants and were prosecuting the same by illegal methods, there was no evidence whatever that any attempt was made to boycott the sale of the complainants' products in other States or anywhere or to interfere with their interstate shipments of goods ready to ship.Page 464
The sole question here is whether a strike against manufacturers by their employees, intended by the strikers to prevent, through illegal picketing and intimidation, continued manufacture, and having such effect, was a conspiracy to restrain interstate commerce under the Anti-Trust Act because such products when made were, to the knowledge of the strikers, to be shipped in interstate commerce to fill orders given and accepted by would-be purchasers in other States, in the absence of evidence that the strikers interfered or attempted to interfere with the free transport and delivery of the products when manufactured from the factories to their destination in other States, or with their sale in those States.
We think that this question has already been answered in the negative by this Court. InUnited Mine Workersv.CoronadoCo.,259 U.S. 344, a coal mining company in Arkansas changed its arrangement with its employees from a closed shop to an open shop. The local union resented the change and the avowed purpose of the company to protect non-union employees by armed guards. Violence, murder and arson were resorted to by the union. Seventy-five per cent. of the output of the mine was to be shipped out of the State and a car of coal prepared for interstate shipment was destroyed by the mob of strikers and their sympathizers. It was contended that, as the result of the conspiracy was to reduce the interstate shipment of coal from the mines by 5,000 tons or more a week, this conspiracy was directed against interstate commerce, and triple damages for the injury inflicted could be recovered under the Federal Anti-Trust Law. But this Court held otherwise and reversed a judgment for a large amount on the ground that the evidence did not disclose a conspiracy against interstate commerce, justifying recovery under the law. The language of the Court was (p. 407):Page 465
"Coal mining is not interstate commerce, and the power of Congress does not extend to its regulation as such. InHammerv.Dagenhart,247 U.S. 251,272, we said: `The making of goods and the mining of coal are not commerce, nor does the fact that these things are to be afterwards shipped or used in interstate commerce, make their production a part thereof.Delaware,Lackawanna Western R.R. Co. v.Yurkonis,238 U.S. 439.' Obstruction to coal mining is not a direct obstruction to interstate commerce in coal, although it, of course, may affect it by reducing the amount of coal to be carried in that commerce." The same rule was followed inGablev.VonnegutMachinery Co., 274 F. 66, 73, 74.
The same general principles are affirmed inHeislerv.Thomas Colliery Co.,260 U.S. 245,259;Crescent Oil Co. v.Mississippi,257 U.S. 129,136;Arkadelphia Milling Co. v.St. Louis S.W. Ry. Co.,249 U.S. 134,151;McCluskeyv.Marysville Ry. Co.,243 U.S. 36,38;Diamond Glue Co. v.U.S. Glue Co.,187 U.S. 611,616;Capital City Dairy Co. v.Ohio,183 U.S. 238,245;United Statesv.E.C. Knight Co.,156 U.S. 1,12,13;Kiddv.Pearson,128 U.S. 1,20,21;Coev.Errol,116 U.S. 517,528.
The Circuit Court of Appeals seems first to have based its conclusion on cases likeRearickv.Pennsylvania,203 U.S. 507;Caldwellv.North Carolina,187 U.S. 622;Brennanv.Titusville,153 U.S. 289; andRobbinsv.Shelby TaxingDistrict,120 U.S. 489,497. These dealt directly with the sale of goods in interstate commerce. They were cases of state taxation upon the solicitation and acceptance of orders of goods to be sent from one State to another. The subject matter taxed was contracts of sale proposed or made for deliveries of goods in interstate commerce. It is a far cry from such cases to a strike to induce the employers to make better terms with their employees when no interference with the transportation orPage 466future sale of the goods by the strikers is attempted or shown.
The Circuit Court of Appeals found further justification for its conclusion in cases likeEureka Pipe Line Co. v.Hallanan,257 U.S. 265,United Fuel Gas Co. v.Hallanan,257 U.S. 277,Dahnke-Walker Milling Co. v.Bondurant,257 U.S. 282, andLemkev.Farmers Grain Co.,258 U.S. 50. They present the practical conception of interstate commerce elaborated inSwift Co. v.United States,196 U.S. 375, hereafter to be discussed, as a flowing stream created by a course of business to be protected against State invasion, but it must be a real and direct invasion and not something incidental or remote. Thus in thePipe Line CompanyandGas CompanyCases, the State of West Virginia sought to tax a stream of oil and gas flowing constantly through the State and out of it. It was held that the mere power of those who directed the stream to divert it from interstate commerce when as a course of business it was constantly interstate with only incidental and minor diversions to intrastate commerce, did not expose to the taxing power of the State that part of the flow which crossed state lines. The burden and invasion of interstate commerce was direct. In theBondurant Case, a Tennessee Milling Company bought a crop of grain in Kentucky, to be delivered on board the cars in Kentucky for shipment to Tennessee in accord with a course of business between the parties. It was held that an effort by the State of Kentucky to require a license of the Tennessee Company before it could buy and ship grain from Kentucky to Tennessee was a burden on, and invasion of, interstate commerce even though the Milling Company might have stopped the grain in Kentucky contrary to the usual course.
InLemkev.Farmers Grain Co., a state law of North Dakota subjected the purchase price of all grain flowing in a regular course of business from that State to thePage 467market in Minneapolis, Minnesota, to a North Dakota inspector who was required to fix the price and determine thereby the profit the buyer should make after paying the freight to Minneapolis at the market price in that city. This was held to be a direct burden and restraint upon the interstate commerce in the grain from one State to the other. It was a direct limitation on that commerce.
None of these cases, although they all illustrate the practical conception of interstate commerce as a flowing stream from one State to another formed by a regular course of business, can properly be said to support the argument that mere intentional cutting down of manufacture or production is a direct restraint of commerce in the product intended to be shipped when ready, or to be any departure from the general rule last announced in theCoronado Caseand uniformly applied in all the cases referred to above, which it followed. The effect upon interstate commerce in the four cases just cited on the other hand was directly burdensome and restraining.
Then the Circuit Court of Appeals found sustaining precedent inSwift Co. v.United States,196 U.S. 375. In that case the defendants were charged with a conspiracy to monopolize interstate commerce in cattle, step by step from the purchase of them on the western plains, in the transportation of them by the railroads through to the stockyards at Chicago, their sale and distribution there, their slaughter and preparation as meats in the packing houses of that city and their distribution and sale in the East. This Court held that such a conspiracy was a violation of the Federal Anti-Trust Law because it was an intended obstruction to the flow of interstate commerce which Congress in the Anti-Trust Law intended to keep free and untrammeled. It held that the intent to monopolize and restrain the stream of interstate commercePage 468and the probability that by such methods and steps as were attempted the purpose of the conspiracy could be effected, brought the whole machinery of the conspiracy within the federal jurisdiction. The case rested wholly on the probably effective intent of the conspirators directed against interstate commerce.
The case of theAddyston Pipe Co. v.United States,175 U.S. 211, was an agreement between those who made and sold iron pipe in different States to fix prices as between themselves and not sell and deliver pipe from their foundries across state lines in competition with each other. Their intent and ability to control prices and prevent the public from having the benefit of competition in interstate trade brought them within the Federal Anti-Trust Act.
So in the case ofMontague Co. v.Lowry,193 U.S. 38, manufacturers in eastern States of tiles and grates agreed with manufacturers and dealers in California not to sell tiles and grates to local dealers who would not agree to keep up prices. The intent to control commerce between the eastern States and local dealers in California, and thus to maintain prices, was held to constitute a conspiracy in restraint of interstate commerce.
On the other hand,Hopkinsv.United States,171 U.S. 578,Andersonv.United States,171 U.S. 604, andUnited Statesv.E.C. Knight Co.,156 U.S. 1, were held not to come within the Federal Anti-Trust Law because the facts of those cases were not thought to reveal the probably effective intent directly to compass the restraint on interstate commerce.
TheKnight Casehas been looked upon by many as qualified by subsequent decisions of this Court. The case is to be sustained only by the view that there was no proof of steps to be taken with intent to monopolize or restrain interstate commerce in sugar, but only proof of the acquisition of stock in sugar manufacturing companies toPage 469control its making. As intimated in theSwift Case(196 U.S. 397), theKnight Casewas very near the line. See also the distinction pointed out by the Circuit Court of Appeals inPennsylvania Sugar Refg. Co. v.American Sugar Refg. Co., 166 F. 254, 256, between that case and theKnight Case. TheKnight Caseemphasizes the difference between manufacture and interstate commerce. But theKnight Casewas a far stronger case for federal jurisdiction under the Anti-Trust Law, because of the probable relation between the monopoly of manufacture and sale in interstate commerce, than the case at bar, in which there is present no element of intended and probable monopoly or discrimination in interstate commerce. The same element was lacking in theCoronado Case.
InLoewev.Lawlor,208 U.S. 274, and inDuplex Co. v.Deering,254 U.S. 443, members of labor unions having a controversy with their employers sought to embarrass the sales by their employers of the product of their manufacture in other States by boycott and otherwise. They were held guilty of a conspiracy against interstate commerce because of their palpable intent to achieve their purpose by direct obstruction of that commerce.
The cases ofStaffordv.Wallace,258 U.S. 495, andChicago Board of Tradev.Olsen,262 U.S. 1, are also supposed in some way to sustain the view that a strike against the manufacture of commodities intended to be shipped in interstate commerce is a conspiracy against that commerce. What those cases decided was that when Congress found from investigation that more or less constant abusive practices and a course of business, usually only within state police cognizance, threatened to obstruct or unduly to burden the freedom of interstate commerce, it could by law institute supervision of such course of business in order to prevent the abuses having such effect. As said inStaffordv.Wallace(p. 520):Page 470
"The reasonable fear by Congress that such acts, usually lawful and affecting only intrastate commerce when considered alone, will probably and more or less constantly be used in conspiracies against interstate commerce or constitute a direct and undue burden on it, expressed in this remedial legislation, serves the same purpose as the intent charged in the Swift indictment to bring acts of a similar character into the current of interstate commerce for federal restraint."
InUnited Statesv.Patten,226 U.S. 525,543, running a corner in the available supply of a staple commodity, normally the subject of interstate commerce, in order to enhance its price artificially in the whole country, although the corner was carried on only in New York by sale of cotton futures, was held to be a monopoly of interstate commerce in violation of the Federal Anti-Trust Act. It was the intent to monopolize such commerce and its probability of success which sustained the indictment.
In theCoronado Case, supra, (p. 410), this Court referred to thePatten Caseand the difference between that and theCoronado Caseas follows:
"The difference between thePatten Caseand that ofWareLelandv.Mobile County,209 U.S. 405, illustrates a distinction to be drawn in cases which do not involve interstate commerce intrinsically but which may or may not be regarded as affecting interstate commerce so directly as to be within the federal regulatory power. In theWare Leland Case, the question was whether a State could tax the business of a broker dealing in contracts for the future delivery of cotton where there was no obligation to ship from one State to another. The tax was sustained and dealing in cotton futures was held not to be interstate commerce, and yet thereafter such dealings in cotton futures as were alleged in thePatten Casewhere they were part of a conspiracy to bring the entire cotton trade within its influence, were held to be in restraint ofPage 471interstate commerce. And so in the case at bar, coal mining is not interstate commerce and obstruction of coal mining, though it may prevent coal from going into interstate commerce, is not a restraint of that commerce unless the obstruction to mining is intended to restrain commerce in it or has necessarily such a direct, material and substantial effect to restrain it that the intent reasonably must be inferred."
This review of the cases makes it clear that the mere reduction in the supply of an article to be shipped in interstate commerce, by the illegal or tortious prevention of its manufacture, is ordinarily an indirect and remote obstruction to that commerce. It is only when the intent or necessary effect upon such commerce in the article is to enable those preventing the manufacture to monopolize the supply, control its price or discriminate as between its would-be purchasers, that the unlawful interference with its manufacture can be said directly to burden interstate commerce.
The record is entirely without evidence or circumstances to show that the defendants in their conspiracy to deprive the complainants of their workers were thus directing their scheme against interstate commerce. It is true that they were, in this labor controversy, hoping that the loss of business in selling goods would furnish a motive to the complainants to yield to demands in respect to the terms of employment; but they did nothing which in any way directly interfered with the interstate transportation or sales of the complainants' product.
We concur with the dissenting Judge in the Circuit Court of Appeals when, in speaking of the conclusion of the majority, he said: "The natural, logical and inevitable result will be that every strike in any industry or even in any single factory will be within the Sherman Act and subject to federal jurisdiction provided any appreciable amount of its product enters into interstate commerce." (284 F. 446, 464.)Page 472
We can not think that Congress intended any such result in the enactment of the Anti-Trust Act or that the decisions of this Court warrant such construction.Decree reversed.
MR. JUSTICE McKENNA, MR. JUSTICE VAN DEVANTER, and MR. JUSTICE BUTLER, dissent.