United States Supreme Court Cases & Opinions

U.S. Supreme Court

FTC v. Beech-Nut Packing Co., 257 U.S. 441 (1922)

Federal Trace Commission v. Beech-Nut Packing Company

No. 47

Argued November 10, 14, 1921

Decided January 3, 1922

257 U.S. 441

Syllabus

1. A trader does not violate the Sherman Act by simply refusing to sell his goods or by withholding them from those who do not sell them at the resale prices he fixes, but he may not, by contracts or combinations express or implied, unduly hinder or obstruct the free and natural flows of interstate commerce. P. 257 U. S. 452.

2. The public policy evinced in the Sherman Act is to be considered in determining what are "unfair methods of competition" within the Federal Trade Commission Act. P. 257 U. S. 453.

3. A plan of merchandising, in interstate trade which has a dangerous tendency unduly to hinder competition or to create monopoly the Federal Trade Commission has authority to order suppressed. P. 257 U. S. 454.

4. The respondent manufacturer, for the purpose of maintaining resale prices fixed by itself, declined to sell its products to jobbers, wholesalers, or retailers who did not observe them or who sold to other dealers who failed to do so, and, to enforce this policy, obtained,

Page 257 U. S. 442

by the cooperation of it customers and through it agents and salesmen, and by marking and tracing the cases of its good, the names of dealers who cut the prices or who sold to others who did so, and enrolled them as undesirable customers to whom it did not sell until they gave satisfactory assurances of their purpose to conform in the future. By these means, it was enabled to suppress competition in the disposition of it products after it had old them by preventing all who did not conform to the resale price from obtaining more goods, although there was no contract for fixing, maintaining or enforcing the resale prices. Held that these or any other equivalent cooperative means should be enjoined, upon an order of the Federal Trade Commission, as an unfair method of competition. P. 257 U. S. 454.

264 F.8d 5 reversed.

Certiorari to review a judgment of the circuit court of appeals setting aside an order of the Federal Trade Commission.

Page 257 U. S. 443