The trustees of the United Mine Workers of America Welfare and
Retirement Fund sued respondents, partners in a coal mining
company, for royalty payments under the National Bituminous Coal
Wage Agreement of 1950, as amended. Respondents filed a cross-claim
for damages, alleging that the trustees, the UMW and certain large
coal operators had conspired to restrain and monopolize commerce in
violation of §§1 and 2 of the Sherman Act. It was alleged that, to
eradicate overproduction in the coal industry, the UMW and large
operators agreed to eliminate the smaller companies by imposing the
terms of the 1950 Agreement on all companies regardless of ability
to pay, by increasing royalties due the welfare fund, by excluding
the marketing, production and sale of nonunion coal, by refusing to
lease coal lands to nonunion operators and refusing to buy or sell
coal mined by such operators, by obtaining from the Secretary of
Labor the establishment of a minimum wage under the Walsh-Healey
Act higher than that in other industries, by urging TVA to curtail
spot market purchases which were exempt from the Walsh-Healey
order, and by waging a price-cutting campaign to drive small
companies out of the spot market. Petitioner's motions to dismiss
were denied, and the jury returned a verdict against the trustees
and the UMW. The trial court set aside the verdict against the
trustees, but overruled the union's motion for judgment
notwithstanding the verdict or for a new trial. The Court of
Appeals affirmed, ruling that the union was not exempt from
liability under the Sherman Act under the facts of the case.
Held:
1. An agreement between the union and large operators to secure
uniform labor standards throughout the industry would not be exempt
from the antitrust laws. Pp.
381 U. S.
661-669.
(a) An agreement resulting from union-employer bargaining is not
automatically exempt from Sherman Act scrutiny merely because the
negotiations covered wage standards, or any other compulsory
subject of bargaining. Pp.
381 U. S. 664-665.
Page 381 U. S. 658
(b) A union may make wage agreements with a multiemployer
bargaining unit and may, in pursuance of its own self-interests,
seek to obtain the same terms from other employers, but it forfeits
its antitrust exemption when it agrees with a group of employers to
impose a certain wage scale on other bargaining units, and thus
joins a conspiracy to curtail competition. Pp.
381 U. S.
665-666.
(c) Nothing in the national labor policy indicates that a union
and employers in one bargaining unit are free to bargain about
wages or working conditions of other bargaining units or to settle
these matters for the whole industry, nor does it allow an employer
to condition the signing of an agreement on the union's imposition
of a similar contract on his competitors. Pp.
381 U. S.
666-667.
(d) Antitrust policy clearly restricts employer-union agreements
seeking to set labor standards outside the bargaining unit, in view
of the anticompetitive potential and the surrender by the union of
its freedom of action with respect to bargaining policy. P.
381 U. S.
668.
2. Concerted efforts to influence public officials do not
violate the antitrust laws even though intended to eliminate
competition.
Eastern R. Conf. v. Noerr Motors,
365 U. S. 127,
followed. Pp.
381 U.S.
669-672.
(a) Instructions to the jury that anticompetitive purpose could
support an illegal conspiracy based solely on the Walsh-Healey and
TVA episodes did not constitute merely harmless error. P.
381 U. S.
670.
(b) Respondents were not entitled to damages under the Sherman
Act for any injury suffered from the actions of the Secretary of
Labor, and the jury should have been so instructed. Pp.
381 U. S.
671-672.
325 F.2d 804, reversed and remanded.
Page 381 U. S. 659
MR. JUSTICE WHITE delivered the opinion of the Court.
This action began as a suit by the trustees of the United Mine
Workers of America Welfare and Retirement Fund against the
respondents, individually and as owners of Phillips Brothers Coal
Company, a partnership, seeking to recover some $55,000 in royalty
payments alleged to be due and payable under the trust provisions
of the National Bituminous Coal Wage Agreement of 1950, as amended,
September 29, 1952, executed by Phillips and United Mine Workers of
America on or about October 1, 1953, and reexecuted with amendments
on or about September 8, 1955, and October 22, 1956. Phillips filed
an answer and a cross-claim against UMW, alleging in both that the
trustees, the UMW and certain large coal operators had conspired to
restrain and to monopolize interstate commerce in violation of §§ 1
and 2 of the Sherman Antitrust Act, as amended, 26 Stat. 209, 15
U.S.C. §§ 1, 2 (1958 ed.). Actual damages in the amount of $100,000
were claimed for the period beginning February 14, 1954, and ending
December 31, 1958. [
Footnote
1]
The allegations of the cross-claim were essentially as follows:
prior to the 1950 Wage Agreement between the operators and the
union, severe controversy had existed in the industry, particularly
over wages, the welfare fund and the union's efforts to control the
working time of
Page 381 U. S. 660
its members. Since 1950, however, relative peace has existed in
the industry, all as the result of the 1950 Wage Agreement and its
amendments and the additional understandings entered into between
UMW and the large operators. Allegedly, the parties considered
overproduction to be the critical problem of the coal industry. The
agreed solution was to be the elimination of the smaller companies,
the larger companies thereby controlling the market. More
specifically, the union abandoned its efforts to control the
working time of the miners, agreed not to oppose the rapid
mechanization of the mines which would substantially reduce mine
employment, agreed to help finance such mechanization and agreed to
impose the terms of the 1950 agreement on all operators without
regard to their ability to pay. The benefit to the union was to be
increased wages as productivity increased with mechanization, these
increases to be demanded of the smaller companies whether
mechanized or not. Royalty payments into the welfare fund were to
be increased also, and the union was to have effective control over
the fund's use. The union and large companies agreed upon other
steps to exclude the marketing, production, and sale of nonunion
coal. Thus, the companies agreed not to lease coal lands to
nonunion operators, and, in 1958, agreed not to sell or buy coal
from such companies. The companies and the union jointly and
successfully approached the Secretary of Labor to obtain
establishment under the Walsh-Healey Act, as amended, 49 Stat.
2036, 41 U.S.C. § 35
et seq. (1958 ed), of a minimum wage
for employees of contractors selling coal to the TVA, such minimum
wage being much higher than in other industries and making it
difficult for small companies to compete in the TVA term contract
market. At a later time, at a meeting attended by both union and
company representatives, the TVA was urged to curtail its spot
market purchases, a substantial portion of which
Page 381 U. S. 661
were exempt from the Walsh-Healey order. Thereafter, four of the
larger companies waged a destructive and collusive price-cutting
campaign in the TVA spot market for coal, two of the companies,
West Kentucky Coal Co. and its subsidiary Nashville Coal Co., being
those in which the union had large investments and over which it
was in position to exercise control.
The complaint survived motions to dismiss, and, after a
five-week trial before a jury, a verdict was returned in favor of
Phillips and against the trustees and the union, the damages
against the union being fixed in the amount of $90,000, to be
trebled under 15 U.S.C. § 15 (1958 ed.). The trial court set aside
the verdict against the trustees, but overruled the union's motion
for judgment notwithstanding the verdict or, in the alternative,
for a new trial. The Court of Appeals affirmed. 325 F.2d 804. It
ruled that the union was not exempt from liability under the
Sherman Act on the facts of this case, considered the instructions
adequate, and found the evidence generally sufficient to support
the verdict. We granted certiorari. 377 U.S. 929. We reverse and
remand the case for proceedings consistent with this opinion.
I
We first consider UMW's contention that the trial court erred in
denying its motion for a directed verdict and for judgment
notwithstanding the verdict, since a determination in UMW's favor
on this issue would finally resolve the controversy. The question
presented by this phase of the case is whether, in the
circumstances of this case, the union is exempt from liability
under the antitrust laws. We think the answer is clearly in the
negative, and that the union's motions were correctly denied.
The antitrust laws do not bar the existence and operation of
labor unions as such. Moreover, § 20 of the Clayton Act, 38 Stat.
738, and § 4 of the Norris-LaGuardia
Page 381 U. S. 662
Act, 47 Stat. 70, permit a union, acting alone, to engage in the
conduct therein specified without violating the Sherman Act.
United States v. Hutcheson, 312 U.
S. 219;
United States v. International Hod Carriers
Council, 313 U.S. 539,
affirming per
curiam, 37 F. Supp.
191 (D.C.N.D.Ill.1941);
United States v. American
Federation of Musicians, 318 U.S. 741,
affirming per
curiam, 47 F. Supp.
304 (D.C.N.D.Ill.1942).
But neither § 20 nor § 4 expressly deals with arrangements or
agreements between unions and employers. Neither section tells us
whether any or all such arrangements or agreements are barred or
permitted by the antitrust laws. Thus,
Hutcheson itself
stated:
"So long as a union acts in its self-interest
and does not
combine with non-labor groups, the licit and the illicit under
§ 20 are not to be distinguished by any judgment regarding the
wisdom or unwisdom, the rightness or wrongness, the selfishness or
unselfishness of the end of which the particular union activities
are the means."
312 U.S. at
312 U. S. 232.
(Emphasis added.)
And in
Allen Bradley Co. v. Union, 325 U.
S. 797, this Court made explicit what had been merely a
qualifying expression in
Hutcheson, and held that,
"when the unions participated with a combination of business men
who had complete power to eliminate all competition among
themselves and to prevent all competition from others, a situation
was created not included with the exemptions of the Clayton and
Norris-LaGuardia Acts."
Id. at
325 U. S. 809.
See also United Brotherhood of Carpenters v. United
States, 330 U. S. 395,
330 U. S.
398-400;
United States v. Employing Plasterers
Assn., 347 U. S. 186,
347 U. S. 190.
Subsequent cases have applied the
Allen Bradley doctrine
to such combinations without regard to whether they found
expression in a collective bargaining agreement,
United
Brotherhood
Page 381 U. S. 663
of Carpenters v. United States, supra; see Teamsters Union
v. Oliver, 358 U. S. 283,
358 U. S. 296,
and even though the mechanism for effectuating the purpose of the
combination was an agreement on wages,
see Adams Dairy Co. v.
St. Louis Dairy Co., 260 F.2d 46 (C.A.8th Cir. 1958), or on
hours of work,
Philadelphia Record Co. v. Manufacturing
Photo-Engravers Assn., 155 F.2d 799 (C.A.3d Cir. 1946).
If the UMW in this case, in order to protect its wage scale by
maintaining employer income, had presented a set of prices at which
the mine operators would be required to sell their coal, the union
and the employers who happened to agree could not successfully
defend this contract provision if it were challenged under the
antitrust laws by the United States or by some party injured by the
arrangement.
Cf. Allen Bradley Co. v. Union, 325 U.
S. 797;
United States v. Borden Co.,
308 U. S. 188,
308 U. S.
203-205;
Lumber Prods. Assn. v. United States,
144 F.2d 546, 548 (C.A.9th Cir. 1944),
aff'd on this issue sub
nom. Brotherhood of Carpenters v. United States, 330 U.
S. 395,
330 U. S.
398-400;
Las Vegas Merchant Plumbers Assn. v. United
States, 210 F.2d 732 (C.A.9th Cir. 1954),
cert.
denied, 348 U.S. 817;
Local 175, IBEW v. United
States, 219 F.2d 431 (C.A.6th Cir. 1955),
cert.
denied, 349 U.S. 917. In such a case, the restraint on the
product market is direct and immediate, is of the type
characteristically deemed unreasonable under the Sherman Act, and
the union gets from the promise nothing more concrete than a hope
for better wages to come.
Likewise, if as is alleged in this case, the union became a
party to a collusive bidding arrangement designed to drive Phillips
and others from the TVA spot market, we think any claim to
exemption from antitrust liability would be frivolous, at best. For
this reason alone, the motions of the unions were properly
denied.
Page 381 U. S. 664
A major part of Phillips' case, however, was that the union
entered into a conspiracy with the large operators to impose the
agreed-upon wage and royalty scales upon the smaller, nonunion
operators, regardless of their ability to pay and regardless of
whether or not the union represented the employees of these
companies, all for the purpose of eliminating them from the
industry, limiting production and preempting the market for the
large, unionized operators. The UMW urges that, since such an
agreement concerned wage standards, it is exempt from the antitrust
laws.
It is true that wages lie at the very heart of those subject
about which employers and unions must bargain, and the law
contemplates agreements on wages not only between individual
employers and a union, but agreements between the union and
employers in a multiemployer bargaining unit.
Labor Board v.
Truck Drivers Union, 353 U. S. 87,
353 U. S. 94-96.
The union benefit from the wage scale agreed upon is direct and
concrete and the effect on the product market, though clearly
present, results from the elimination of competition based on wages
among the employers in the bargaining unit, which is not the kind
of restraint Congress intended the Sherman Act to proscribe.
Apex Hosiery Co. v. Leader, 310 U.
S. 469,
310 U. S.
503-504;
see Adams Dairy Co. v. St. Louis Dairy
Co., 260 F.2d 46 (C.A.8th Cir. 1958). We think it beyond
question that a union may conclude a wage agreement with the
multiemployer bargaining unit without violating the antitrust laws,
and that it may, as a matter of its own policy, and not by
agreement with all or part of the employers of that unit, seek the
same wages from other employers.
This is not to say that an agreement resulting from
union-employer negotiations is automatically exempt from Sherman
Act scrutiny simply because the negotiations involve a compulsory
subject of bargaining, regardless
Page 381 U. S. 665
of the subject or the form and content of the agreement.
Unquestionably, the Board's demarcation of the bounds of the duty
to bargain has great relevance to any consideration of the sweep of
labor's antitrust immunity, for we are concerned here with
harmonizing the Sherman Act with the national policy expressed in
the National Labor Relations Act of promoting "the peaceful
settlement of industrial disputes by subjecting labor-management
controversies to the mediatory influence of negotiation,"
Fibreboard Paper Prods. Corp. v. Labor Board, 379 U.
S. 203,
379 U. S. 211.
But there are limits to what a union or an employer may offer or
extract in the name of wages, and because they must bargain does
not mean that the agreement reached may disregard other laws.
Teamsters v. Oliver, 358 U. S. 283,
358 U. S. 296;
Carpenters v. United States, 330 U.
S. 395,
330 U. S.
399-400.
We have said that a union may make wage agreements with a
multiemployer bargaining unit and may, in pursuance of its own
union interests, seek to obtain the same terms from other
employers. No case under the antitrust laws could be made out on
evidence limited to such union behavior. [
Footnote 2] But we think a union forfeits its exemption
from the antitrust laws when it is clearly shown that it has agreed
with one set of employers to impose a certain wage scale on other
bargaining units. One group of employers may not conspire to
eliminate competitors from
Page 381 U. S. 666
the industry and the union is liable with the employers if it
becomes a party to the conspiracy. This is true even though the
union's part in the scheme is an undertaking to secure the same
wages, hours or other conditions of employment from the remaining
employers in the industry.
We do not find anything in the national labor policy that
conflicts with this conclusion. This Court has recognized that a
legitimate aim of any national labor organization is to obtain
uniformity of labor standards, and that a consequence of such union
activity may be to eliminate competition based on differences in
such standards.
Apex Hosiery Co. v. Leader, 310 U.
S. 469,
310 U. S. 503.
But there is nothing in the labor policy indicating that the union
and the employers in one bargaining unit are free to bargain about
the wages, hours and working conditions of other bargaining units
or to attempt to settle these matters for the entire industry. On
the contrary, the duty to bargain unit by unit leads to a quite
different conclusion. The union's obligation to its members would
seem best served if the union retained the ability to respond to
each bargaining situation as the individual circumstances might
warrant, without being strait-jacketed by some prior agreement with
the favored employers.
So far as the employer is concerned it has long been the Board's
view that an employer may not condition the signing of a collective
bargaining agreement on the union's organization of a majority of
the industry.
American Range Lines, Inc., 13 N.L.R.B. 139,
147 (1939);
Samuel Youlin, 22 N.L.R.B. 879, 885 (1940);
Newton Chevrolet, Inc., 37 N.L.R.B. 334, 341 (1941);
see Labor Board v. George P. Pilling & Son Co., 119
F.2d 32, 38 (C.A.3d Cir. 1941). In such cases, the obvious interest
of the employer is to ensure that acceptance of the union's wage
demands will not adversely affect his competitive position. In
American Range Lines, Inc., supra, the
Page 381 U. S. 667
Board rejected that employer interest as a justification for the
demand.
"[A]n employer cannot lawfully deny his employees the right to
bargain collectively through their designated representative in an
appropriate unit because he envisions competitive disadvantages
accruing from such bargaining."
13 N.L.R.B. at 147. Such an employer condition, if upheld, would
clearly reduce the extent of collective bargaining. Thus, in
Newton Chevrolet, Inc., supra, where it was held a refusal
to bargain for the employer to insist on a provision that the
agreed contract terms would not become effective until five
competitors had signed substantially similar contracts, the Board
stated that
"[t]here is nothing in the Act to justify the imposition of a
duty upon an exclusive bargaining representative to secure an
agreement from a majority of an employer's competitors as a
condition precedent to the negotiation of an agreement with the
employer. To permit individual employers to refuse to bargain
collectively until some or all of their competitors had done so
clearly would lead to frustration of the fundamental purpose of the
Act to encourage the practice of collective bargaining."
37 N.L.R.B. at 341. Permitting insistence on an agreement by the
union to attempt to impose a similar contract on other employers
would likewise seem to impose a restraining influence on the extent
of collective bargaining, for the union could avoid an impasse only
by surrendering its freedom to act in its own interest
vis-a-vis other employers, something it will be unwilling
to do in many instances. Once again, the employer's interest is a
competitive interest, rather than an interest in regulating its own
labor relations, and the effect on the union of such an agreement
would be to limit the free exercise of the employees' right to
engage in concerted activities according to their own views of
their self-interest. In sum, we cannot conclude that the national
labor policy provides any support for such agreements.
Page 381 U. S. 668
On the other hand, the policy of the antitrust laws is clearly
set against employer-union agreements seeking to prescribe labor
standards outside the bargaining unit. One could hardly contend,
for example, that one group of employers could lawfully demand that
the union impose on other employers wages that were significantly
higher than those paid by the requesting employers, or a system of
computing wages that, because of differences in methods of
production, would be more costly to one set of employers than to
another. The anticompetitive potential of such a combination is
obvious, but is little more severe than what is alleged to have
been the purpose and effect of the conspiracy in this case to
establish wages at a level that marginal producers could not pay,
so that they would be driven from the industry. And if the
conspiracy presently under attack were declared exempt, it would
hardly be possible to deny exemption to such avowedly
discriminatory schemes.
From the viewpoint of antitrust policy, moreover, all such
agreements between a group of employers and a union that the union
will seek specified labor standards outside the bargaining unit
suffer from a more basic defect, without regard to predatory
intention or effect in the particular case. For the salient
characteristic of such agreements is that the union surrenders its
freedom of action with respect to its bargaining policy. Prior to
the agreement, the union might seek uniform standards in its own
self-interest, but would be required to assess in each case the
probable costs and gains of a strike or other collective action to
that end, and thus might conclude that the objective of uniform
standards should temporarily give way. After the agreement, the
union's interest would be bound in each case to that of the favored
employer group. It is just such restraints upon the freedom of
economic units to act according to their own choice and discretion
that run counter to antitrust policy.
See, e.g., 326 U.
S. S. 669� Press v. United States,
326 U. S.
1, 326 U. S.
19; Fashion Originators' Guild v. Federal Trade
Comm'n,
312 U. S. 457,
312 U. S.
465; Anderson v. Shipowners Assn.,@
272 U.
S. 359,
272 U. S.
364-365.
Thus the relevant labor and antitrust policies compel us to
conclude that the alleged agreement between UMW and the large
operators to secure uniform labor standards throughout the
industry, if proved, was not exempt from the antitrust laws.
II
The UMW next contends that the trial court erroneously denied
its motion for a new trial based on claimed errors in the admission
of evidence.
In
Eastern R. Conf. v. Noerr Motor Freight Inc.,
365 U. S. 127, the
Court rejected an attempt to base a Sherman Act conspiracy on
evidence consisting entirely of activities of competitors seeking
to influence public officials. The Sherman Act, it was held, was
not intended to bar concerted action of this kind even though the
resulting official action damaged other competitors at whom the
campaign was aimed. Furthermore, the legality of the conduct "was
not at all affected by any anticompetitive purpose it may have
had,"
id. at
365 U. S. 140
-- even though the
"sole purpose in seeking to influence the passage and
enforcement of laws was to destroy the truckers as competitors for
the long-distance freight business."
Id. at
365 U. S. 138.
Nothing could be clearer from the Court's opinion than that
anticompetitive purpose did not illegalize the conduct there
involved.
We agree with the UMW that both the Court of Appeals and the
trial court failed to take proper account of the
Noerr
case. In approving the instructions of the trial court with regard
to the approaches of the union and the operators to the Secretary
of Labor and to the TVA officials, the Court of Appeals considered
Noerr as applying only to conduct
"unaccompanied by a purpose or intent to further a conspiracy to
violate a statute. It is
Page 381 U. S. 670
the illegal purpose or intent inherent in the conduct which
vitiates the conduct which would otherwise be legal."
325 F.2d at 817.
Noerr shields from the Sherman Act a
concerted effort to influence public officials regardless of intent
of purpose. The Court of Appeals, however, would hold the conduct
illegal depending upon proof of an illegal purpose.
The instructions of the trial court to the jury exhibit a
similar infirmity. The jury was instructed that the approach to the
Secretary of Labor was legal unless part of a conspiracy to drive
small operators out of business and that the approach to the TVA
was not a violation of the antitrust laws "unless the parties so
urged the TVA to modify its policies in buying coal for the purpose
of driving the small operators out of business." If, therefore, the
jury determined the requisite anticompetitive purpose to be
present, it was free to find an illegal conspiracy based solely on
the Walsh-Healey and TVA episodes, or in any event to attribute
illegality to these acts as part of a general plan to eliminate
Phillips and other operators similarly situated. Neither finding,
however, is permitted by
Noerr for the reasons stated in
that case. Joint efforts to influence public officials do not
violate the antitrust laws even though intended to eliminate
competition. Such conduct is not illegal, either standing alone or
as part of a broader scheme itself violative of the Sherman Act.
The jury should have been so instructed and, given the obviously
telling nature of this evidence, we cannot hold this lapse to be
mere harmless error. [
Footnote
3]
Page 381 U. S. 671
There is another reason for remanding this case for further
proceedings in the lower courts. It is clear under
Noerr
that Phillips could not collect any damages under the Sherman Act
for any injury which it suffered from the action of the Secretary
of Labor. The conduct of the union and the operators did not
violate the Act, the action taken to set a minimum wage for
government purchases of coal was the act of a public official who
is not claimed to be a co-conspirator, and the jury should have
been instructed, as UMW requested, to exclude any damages which
Phillips may have suffered as a result of the Secretary's
Walsh-Healey determinations. [
Footnote 4]
See also American Banana Co. v. United
Fruit Co., 213 U. S. 347,
213 U. S. 358;
Angle v. Chicago, St. Paul, Minneapolis & Omaha R.
Co., 151 U. S. 1,
151 U. S. 16-21;
Okefenokee Rural Elec. Mem. Corp. v. Florida P. & L.
Co., 214 F.2d 413, 418 (C.A.5th Cir. 1954). The trial court,
however, admitted evidence
Page 381 U. S. 672
concerning the Walsh-Healey episodes for "whatever bearing it
may have on the overall picture," and told the jury in its final
instructions to include in the verdict all damages resulting
directly from any act which was found to be part of the conspiracy.
The effect this may have had on the jury is reflected by the
statement of the Court of Appeals that the jury could reasonably
conclude
"that the wage determination for the coal industry under the
Walsh-Healey Act and the dumping of West Kentucky coal on the TVA
spot market materially and adversely affected the operations of
Phillips in the important TVA market . . . ,"
325 F.2d at 815, and that "[t]his minimum wage determination
prevented Phillips from bidding on the TVA term market . . . ,"
id. at 814. [
Footnote
5]
The judgment is reversed, and the case remanded for further
proceedings consistent with this opinion. It is so ordered.
Reversed and remanded.
[
Footnote 1]
The parties stipulated that the damages period would include the
four-year limitations period, 15 U.S.C. § 15b (1958 ed.), preceding
the filing of Phillips' cross-claim and extend up to December 31,
1958, the date on which Phillips terminated its business.
[
Footnote 2]
Unilaterally, and without agreement with any employer group to
do so, a union may adopt a uniform wage policy and seek vigorously
to implement it even though it may suspect that some employers
cannot effectively compete if they are required to pay the wage
scale demanded by the union. The union need not gear its wage
demands to wages which the weakest units in the industry can afford
to pay. Such union conduct is not alone sufficient evidence to
maintain a union-employer conspiracy charge under the Sherman Act.
There must be additional direct or indirect evidence of the
conspiracy. There was, of course, other evidence in this case, but
we indicate no opinion as to its sufficiency.
[
Footnote 3]
It would, of course, still be within the province of the trial
judge to admit this evidence, if he deemed it probative and not
unduly prejudicial, under the
"established judicial rule of evidence that testimony of prior
or subsequent transactions, which for some reason are barred from
forming the basis for a suit, may nevertheless be introduced if it
tends reasonably to show the purpose and character of the
particular transactions under scrutiny.
Standard Oil Co. v.
United States, 221 U. S. 1,
221 U. S.
46,
221 U. S. 47.
United States
v. Reading Co., 253 U. S. 26,
253 U. S.
43-44."
Federal Trade Comm'n v. Cement Institute, 333 U.
S. 683,
333 U. S. 705;
see also Heike v. United States, 227 U.
S. 131,
227 U. S. 145;
American Medical Assn. v. United States, 76 U.S.App.D.C.
70, 87-89, 130 F.2d 233, 250-252 (1942),
aff'd,
319 U. S. 317
U.S. 519 (certiorari limited to other issues).
[
Footnote 4]
By contrast, in
Continental Ore Co. v. Union Carbide &
Carbon Corp., 370 U. S. 690, we
held that the acts of a wartime purchasing agent appointed by the
Canadian Government could be proved as part of the conspiracy and
as an element in computing damages. The purchasing agent, however,
was not a public official, but the wholly owned subsidiary of an
American corporation alleged to be a principal actor in the
conspiracy. The acts complained of had been performed at the
direction of the purchasing agent's American parent, and there
was
"no indication that the Controller or any other official within
the structure of the Canadian Government approved or would have
approved of joint efforts to monopolize the production and sale of
vanadium or directed that purchases from [the plaintiff] be
stopped."
370 U.S. at
370 U. S. 706.
That case is wholly dissimilar to both
Noerr and the
present case.
[
Footnote 5]
This latter conclusion regarding the term market would seem
doubly erroneous as Phillips had virtually conceded, in the course
of offering evidence respecting bids of the alleged conspirators on
the term market, that it was claiming no damages from its exclusion
from the term market, a market it never had any immediate prospect
of entering. The trial court ruled that the proffered testimony was
inadmissible on the damages phase of the case.
MR. JUSTICE DOUGLAS, with whom MR. JUSTICE BLACK, and MR.
JUSTICE CLARK agree, concurring.
As we read the opinion of the Court, it reaffirms the principles
of
Allen Bradley Co. v. Union, 325 U.
S. 797, and tells the trial judge:
First. On the new trial, the jury should be instructed
that if there were an industry-wide collective bargaining agreement
whereby employers and the union agreed on a
Page 381 U. S. 673
wage scale that exceeded the financial ability of some operators
to pay, and that, if it was made for the purpose of forcing some
employers out of business, the union, as well as the employers who
participated in the arrangement with the union, should be found to
have violated the antitrust laws.
Second. An industry-wide agreement containing those
features is
prima facie evidence of a violation.
*
In
Allen Bradley Co. v. Union, supra, the union was
promoting closed shops in the New York City area. It got
contractors to purchase equipment only from local manufacturers who
had closed-shop agreements with the union, and it got manufacturers
to confine their New York City sales to contractors employing the
union's members. Agencies were set up to boycott recalcitrant local
contractors and manufacturers and bar from the area equipment
manufactured outside its boundaries. As we said:
"The combination among the three groups, union, contractors, and
manufacturers, became highly successful from the standpoint of all
of them. The business of New York City manufacturers had a
phenomenal growth, thereby multiplying the jobs available for the
Local's members. Wages went up, hours were shortened, and the New
York electrical equipment
Page 381 U. S. 674
prices soared, to the decided financial profit of local
contractors and manufacturers."
325 U.S. at
325 U. S.
800.
I repeat what we said in
Allen Bradley Co. v. Union,
supra, at
325 U. S.
811:
"The difficulty of drawing legislation primarily aimed at trusts
and monopolies so that it could also be applied to labor
organizations without impairing the collective bargaining and
related rights of those organizations has been emphasized both by
congressional and judicial attempts to draw lines between
permissible and prohibited union activities. There is, however, one
line which we can draw with assurance that we follow the
congressional purpose. We know that Congress feared the
concentrated power of business organizations to dominate markets
and prices. It intended to outlaw business monopolies. A business
monopoly is no less such because a union participates, and such
participation is a violation of the [Sherman] Act."
Congress can design an oligopoly for our society, if it chooses.
But business alone cannot do so as long as the antitrust laws are
enforced. Nor should business and labor, working hand-in-hand, be
allowed to make that basic change in the design of our so-called
free enterprise system. If the allegations in this case are to be
believed, organized labor joined hands with organized business to
drive marginal operators out of existence. According to those
allegations, the union used its control over West Kentucky Coal Co.
and Nashville Coal Co. to dump coal at such low prices that
respondents, who were small operators, had to abandon their
business. According to those allegations, there was a boycott by
the union and the major companies against small companies who
needed major companies' coal land on which to operate.
According
Page 381 U. S. 675
to those allegations, high wage and welfare terms of employment
were imposed on the small, marginal companies by the union and the
major companies with the knowledge and intent that the small ones
would be driven out of business.
The only architect of our economic system is Congress. We are
right in adhering to its philosophy of the free enterprise system
as expressed in the antitrust laws and as enforced by
Allen
Bradley Co. v. Union, supra, until the Congress delegates to
big business and big labor the power to remold our economy in the
manner charged here.
*
"It is elementary that an unlawful conspiracy may be, and often
is, formed without simultaneous action or agreement on the part of
the conspirators.
United States v. Schenck, 253 F. 212,
213,
affirmed, 249 U. S. 249 U.S. 47;
Levey
v. United States, 92 F.2d 688, 691. Acceptance by competitors,
without previous agreement, of an invitation to participate in a
plan, the necessary consequence of which, if carried out, is
restraint of interstate commerce, is sufficient to establish an
unlawful conspiracy under the Sherman Act.
Eastern States
Lumber Assn. v. United States, 234 U. S.
600;
Lawlor v. Loewe, 235 U. S.
522,
235 U. S. 534;
American
Column & Lumber Co. v. United States, 257 U. S.
377;
United States v. American Linseed Oil Co.,
262 U. S.
371."
Interstate Circuit v. United States, 306 U.
S. 208,
306 U. S.
227.