Consent of parties can never confer jurisdiction upon a federal
court. If the record does not affirmatively show jurisdiction in
the circuit court, this Court must, upon its own motion, so
declare, and make such order as will prevent the circuit court from
exercising an authority not conferred upon it by statute.
A state is not a citizen within the meaning of the provisions of
the Constitution or acts of Congress regulating the jurisdiction of
the federal courts.
Under existing statutes regulating the jurisdiction of the
courts of the United States, a case cannot be removed from a state
court as one arising under the Constitution or laws of the United
States unless the plaintiff's complaint, bill, or declaration shows
it to be a case of that character.
While an allegation in a complaint filed in a circuit court of
the United States may confer jurisdiction to determine whether the
case is of the class of which the court may properly take
cognizance for purposes of a final decree on the merits, if,
notwithstanding such allegation, the court finds at any time that
the case does not really and substantially involve a dispute or
controversy within its jurisdiction, then, by the express command
of the act of 1875, its duty is to proceed no further. And if the
suit, as disclosed by the complaint, could not have been brought by
plaintiff originally in the circuit court, then, under the act of
1887-1888 it should not have been removed from the state court, and
should be remanded.
The intention of the Anti-Trust Act of July 2, 1890, 26 Stat.
209, was to limit direct proceedings in equity to prevent and
restrain such violations of the Anti-Trust Act as cause injury to
the general public, or to all alike, merely from the suppression of
competition in trade and commerce among the several states and with
foreign nations, to those instituted in the name of the United
States, under § 4 of the act, by district attorneys of the United
States, acting under the direction of the Attorney General, thus
securing the enforcement of the act, so far as such direct
proceedings in equity are concerned, according to some uniform plan
operative throughout the entire country.
A state cannot maintain an action in equity to restrain a
corporation from violating the provisions of the Act of July 2,
1890, on the ground that such violations, by decreasing
competition, would depreciate the value of its public lands and
enhance the cost of maintaining its public institutions, the
damages resulting from such violations being remote and indirect,
and not such direct actual injury as is provided for in § 7 of the
act.
Page 194 U. S. 49
Article IV of the Constitution of the United States only
prescribes a rule by which courts, federal and state, are to be
guided when a question arises in the progress of a pending suit as
to the faith and credit to be given by the court to the public
acts, records, and judicial proceedings of a state other than that
in which the court is sitting. It has nothing to do with the
conduct of individuals or corporations.
The facts are stated in the opinion of the Court.
Page 194 U. S. 56
MR. JUSTICE HARLAN delivered the opinion of the Court.
By a statute of Minnesota passed March 9, 1874, it was
provided
Page 194 U. S. 57
that no railroad corporation or the lessees, purchasers, or
managers thereof should consolidate the stock, property, or
franchises of such corporation with, or lease or purchase the works
or franchises of, or in any way control, any other railroad
corporation owning or having under its control a parallel or
competing line; nor should any officer of such corporation act as
an officer of any other railroad corporation owning or having the
control of a parallel or competing line, and the question whether
railroads were parallel or competing lines should, when demanded by
the party complainant, be decided by a jury as in other civil
issues. Laws, Minnesota, 1874, p. 154.
A subsequent statute, passed March 3, 1881, provided that any
railroad corporation, either domestic or foreign, whether organized
under a general law or by virtue of a special charter, might lease
or purchase, or become owner of or control, or hold the stock of,
any other railroad corporation when the respective railroads could
be lawfully connected and operated together "so as to constitute
one continuous main line, with or without branches," § 1, and that
any railroad corporation whose lines of railroad within or without
the state might be lawfully connected and operated together to
constitute one continuous main line so as to admit of the passage
of trains over them without break or interruption "could
consolidate their stock and franchises so as to become one
corporation." § 2. But, by the same statute, it was provided that
no railroad corporation should consolidate with, lease, or purchase
or in any way become owner of or control any other railroad
corporation, or any stock, franchises, rights of property thereof,
which owned or controlled "a parallel or competing line." § 3.
Laws, Minnesota, 1881, p. 109.
At a later date, 1899, the Legislature of Minnesota passed
another statute relating principally to such restraints upon trade
and commerce as interfered with competition among those engaged
therein. That statute contained these provisions:
Page 194 U. S. 58
"SEC 1. Any contract, agreement, arrangement, or conspiracy, or
any combination in the form of a trust or otherwise hereafter
entered into which is in restraint of trade or commerce within this
state, or in restraint of trade or commerce between any of the
people of this state and any of the people of any other state or
country, or which limits or tends to limit or control the supply of
any article, commodity, or utility, or the articles which enter
into the manufacture of any article [of] utility, or which
regulates, limits, or controls or raises or tends to regulate,
limit, control, or raise the market price of any article,
commodity, or utility, or tends to limit or regulate the production
of any such article, commodity, or utility, or in any manner
destroys, limits, or interferes with open and free competition in
either the production, purchase, or sale of any commodity, article,
or utility, is hereby prohibited and declared to be unlawful."
"SEC 2. That when any corporation heretofore or hereafter
created, organized, or existing under the laws of this state,
whether general or special, hereafter unites in any manner with any
other corporation, wheresoever created, or with any individual
whereby such corporation surrenders or transfers, by sale or
otherwise, in whole or in part, its franchise, rights, or
privileges, or the control or management of its business to any
other corporation or individual, or whereby the business,
management, or control of the business of such corporation is
limited, changed, or in any manner affected, and the purpose or
effect of such union or combination is to limit, control, or
destroy competition in the manufacture or sale of any article or
commodity, or is to limit or control the production of any article
or commodity, or is to control of fix the price or market value of
any article or commodity, or the price or market value of the
material entering into the production of any article or commodity,
or in case the purpose or effect of such union or combination is to
control or monopolize in any manner the trade or commerce, or any
part thereof, of this state or of the several states, such union,
combination, agreement, arrangement,
Page 194 U. S. 59
or contract is hereby prohibited and declared to be unlawful. .
. ."
"SEC 3. Any corporation heretofore or hereafter created,
organized, or existing under the laws of this state which shall
hereafter, either directly or indirectly make any contract,
agreement, or arrangement, or enter into any combination,
conspiracy, or trust, as defined in section 1 of this act, shall,
in addition to the penalty prescribed in section 2 of this act,
forfeit its charter, rights, and franchises, and it shall
thereafter be unlawful for such corporation to engage in business,
either as a corporation or as a part of any combination, trust, or
monopoly, except as to the final disposition of its property under
the laws of this state."
"
* * * *"
"SEC 6. That, for the purpose of carrying out the provisions of
this act, any citizen of this state may, and it is hereby declared
to be the duty of the Attorney General to, institute, in the name
of the state, proceedings in any court of competent jurisdiction
against any person, partnership, association, or corporation who
may be guilty of violating any of the provisions of section one of
this act for the purpose of imposing the penalties imposed by this
act, or securing the enforcement of section three hereof."
Minn.Gen.Laws, 1899, c. 359.
These statutes being in force, the State of Minnesota instituted
this suit in one of its own courts against the Northern Securities
Company, a corporation of New Jersey, the Great Northern Railway
Company, a corporation of Minnesota, the Northern Pacific Railway
Company, a corporation of Wisconsin, which, having filed its
articles of incorporation with the secretary of State of Minnesota,
became subject to the laws of that state relating to railroad
corporations, and James J. Hill, as president of the Northern
Securities Company, and individually.
What is the nature of the case as disclosed by the complaint
filed in the state court?
The complaint alleged:
That the Great Northern Railway Company and the Northern
Page 194 U. S. 60
Pacific Railway Company each owned or controlled and maintained
a system of railways connecting the Great Lakes and the Pacific
Ocean, their main roads constituting substantially parallel and
competing lines.
That, pursuant to an agreement between the defendant Hill and
other stockholders of the Great Northern Railway Company
(representing a controlling interest in the stock of that company)
and J. Pierpont Morgan and other stockholders of the Northern
Pacific Railway Company (representing a controlling interest in the
stock of that company), the Northern Securities Company was
incorporated solely as an instrumentality through which the stock,
property, and franchises of the Great Northern and Northern Pacific
Railway Companies should be consolidated, in effect, if not in
form, and the management and control of their business affairs,
respectively, including the fixing of rates and charges for the
transportation of passengers and freight over any and all of the
lines of railway of each of those companies, as well within as
without the state, be vested in and controlled by the Securities
Company, and all competition in freight and passenger traffic
between the two systems of railway, within and without the state,
to be suppressed and removed; that, by means of such arrangement,
it was sought and intended to ignore, evade, and violate the laws
of the state prohibiting as well the consolidation of the stock,
property, or franchise of parallel or competing lines of railway
therein, and the control or management thereof, as all combinations
in restraint of trade or commerce within the state, and between the
people of Minnesota and the people of other states and countries,
and that, if the Securities Company was allowed to hold and control
the stocks of the constituent railway companies, and to carry out
the purpose and object of its incorporators as well as its own,
"full faith and credit will not be given to the public acts of
this complainant, and it will be deprived of a further right
guaranteed to it by the Constitution of the United States."
That the said scheme had been consummated, and said two
Page 194 U. S. 61
railway systems were now under the absolute management and
control of the Securities Company, and,
"by reason thereof, all competition between said lines has been
destroyed, and a monopoly in railway traffic in Minnesota (as well
as without said state) has been created, to the great and permanent
and irreparable damage of the State of Minnesota, and to the people
thereof, and in violation of its laws,
and of the laws of the
United States in such case made and provided,
viz.:
the Act of Congress approved July 2, 1890, entitled 'An Act to
Protect Trade and Commerce Against Unlawful Restraints and
Monopolies,' and"
That the carrying out the above agreements and plan of
consolidation and monopoly, and in every step taken to consummate
it, the officers and directors of each of said railway companies
were severally fully advised and consented thereto, and, unless
restrained by this court, the Securities Company would continue to
manage and control the business and affairs of Great Northern and
Northern Pacific Railway Companies, and to suppress all competition
between them for freight and passenger traffic, as well as to
monopolize railway traffic in that state, to the irreparable damage
of the state and the people thereof.
The substantial relief asked was a decree declaring, among other
things, the alleged agreement and combination to be unlawful, and
all acts done and to be done in pursuance thereof contrary to, and
in violation of, the laws of Minnesota
and of the United
States prohibiting the Securities Company, its agents and
officers, from acquiring, receiving, holding, voting, or in any
manner acting as the owner of any of the shares of the capital
stock of either the Northern Pacific or the Great Northern Railway
Company, or from exercising any management, direction, or control
over the constituent companies, and enjoining those railway
companies from recognizing or accepting the Northern Securities
Company as the holder or owner of any shares of the capital stock
of either of those companies, or from effecting any combination or
agreement
Page 194 U. S. 62
that would disturb their independent integrity, management, and
control, respectively, or that would, directly or indirectly,
destroy free and unlimited competition between them by interchange
of traffic, poolings of earnings, division of property, or
otherwise.
The Securities Company, appearing specially for that purpose,
filed its petition for the removal of the case into the circuit
court of the United States upon the ground that the suit was of a
civil nature, in equity, involved, exclusive of costs, the sum of
$2,000, and was
one arising under the Constitution and laws of
the United States.
The state court approved the required statutory bond for
removal, and made an order reciting that the case was removed to
the federal court.
The Northern Securities Company, appearing specially for that
purpose, gave notice of a motion to have the service of summons
upon it vacated. Notice was also given of a like motion as to the
service of summons upon defendant Hill in his capacity as president
of that company. Subsequently, the company, and defendant Hill as
its president, gave notice that the above notices were withdrawn,
and they accordingly entered their appearance in the cause.
At a later date, the defendants severally answered, and the
state filed its replication to each answer. Proofs were taken, and,
the cause having been heard, the bill was dismissed upon the
merits. 123 F. 692.
After the cause was argued here, the parties were invited to
submit briefs upon the question whether the circuit court of the
United States could take cognizance of the case upon removal from
the state court. From the briefs filed in response to that
invitation, it appeared that both sides deemed the case a removable
one, and insist that this Court should consider the merits as
disclosed by the pleadings and evidence. But consent of parties can
never confer jurisdiction upon a federal court. If the record does
not affirmatively show jurisdiction in the circuit court, we must,
upon our own
Page 194 U. S. 63
motion, so declare, and make such order as will prevent that
court from exercising an authority not conferred upon it by
statute.
Mansfield, C. & L. M. Railway Co. v. Swan,
111 U. S. 379,
111 U. S. 382;
Robertson v. Cease, 97 U. S. 646;
King Bridge Co. v. Otoe County, 120 U.
S. 225;
Parker v. Ormsby, 141 U.
S. 83;
Mattingly v. Northwestern Va. R. Co.,
158 U. S. 53,
158 U. S. 57;
Great Southern Fire Proof Hotel Co. v. Jones, 177 U.
S. 449,
177 U. S. 453;
Continental National Bank v. Buford, 191
U. S. 120;
Defiance Water Co. v. Defiance,
191 U. S. 184,
191 U. S.
194.
We proceed, therefore, to inquire whether the circuit court
could take cognizance of this case upon removal from the state
court, and make a final decree upon the merits.
Of course, the circuit court could not take cognizance of the
case as one presenting a controversy between citizens of different
states, for the State of Minnesota is not a citizen within the
meaning of the Constitution or the acts of Congress.
Postal
Tel. Cable Co. v. Alabama, 155 U. S.
487.
But the first section of the Judiciary Act of 1887-1888, 24
Stat. 552, c. 373, 25 Stat. 433, c. 866, provides, among other
things, that the circuit courts of the United States may take
original cognizance of all suits of a civil nature at law or in
equity arising under the Constitution or laws of the United States
where the matter in dispute, exclusive of costs, exceeds in value
the sum of $2,000. And the second section provides for the removal
from a state court of
"any suit of a civil nature at law or in equity, arising under
the Constitution or laws of the United States . . . of which the
circuit courts of the United States are given original jurisdiction
by the preceding section."
In
Tennessee v. Union & Planters' Bank,
152 U. S. 454,
152 U. S. 461,
which involved the scope and meaning of the acts of 1887-1888 in
respect of cases arising under the Constitution or laws of the
United States, this Court, after referring to section one,
said:
"But the corresponding clause in section 2 allows removals from
a state court to be made only by defendants, and of suits 'of which
the circuit courts of the United States are given
Page 194 U. S. 64
original jurisdiction by the preceding section,' thus limiting
the jurisdiction of a circuit court of the United States
on
removal by the defendant under this section to such suits
as might have been brought in that court
by the
plaintiff under the first section. 24 Stat. 553; 25 Stat. 434.
The change is in accordance with the general policy of these acts,
manifest upon their face, and often recognized by this Court, to
contract the jurisdiction of the circuit courts of the United
States."
Mexican Nat. Railroad v. Davidson, 157 U.
S. 201,
157 U. S. 208;
Metcalf v. Watertown, 128 U. S. 586.
And, in
Chappell v. Waterworth, 155 U.
S. 102,
155 U. S. 107,
the Court, referring to
Tennessee v. Union & Planters'
Bank, said that it was there adjudged, upon full
consideration, that, under the act of 1887-1888,
"a case (not depending on the citizenship of the parties nor
otherwise specially provided for) cannot be removed from a state
court into the circuit court of the United States
as one
arising under the Constitution, laws, or treaties of the United
States, unless that appears by the plaintiff's statement of
his own claim, and that, if it does not so appear, the want cannot
be supplied by any statement in the petition for removal, or in the
subsequent pleadings."
To the same effect are
Postal Tel. Cable Co. v.
Alabama, 155 U. S. 487;
United States v. American Bell. Tel. Co., 159 U.
S. 548,
159 U. S. 553;
Oregon Short Line v. Skottowe, 162 U.
S. 490,
162 U. S. 494;
Texas & Pacific Railway Co. v. Cody, 166 U.
S. 606,
166 U. S. 608;
Pratt v. Paris Gas Light & Coke Co., 168 U.
S. 255,
168 U. S. 258;
Walker v. Collins, 167 U. S. 57,
167 U. S. 59;
Arkansas v. Kansas & Texas Coal Co., 183 U.
S. 185;
Western Union Tel. Co. v. Ann Arbor R.
Co., 178 U. S. 239.
These cases establish beyond further question in this Court the
rule that, under existing statutes regulating the jurisdiction of
the courts of the United States, a case cannot be removed from a
state court as one arising under the Constitution or laws of the
United States unless the plaintiff's complaint, bill, or
declaration shows it to be a case of that character. "If it does
not appear at the outset," this Court has quite recently said,
"that the suit is one of which the circuit court at the time its
jurisdiction
Page 194 U. S. 65
is invoked could properly take cognizance, the suit must be
dismissed."
Third St. & Suburban Ry. Co. v. Lewis,
173 U. S. 457,
173 U. S.
460.
We must, then, inquire whether the complaint presents a case
arising under the Constitution or laws of the United States in
respect of which the original jurisdiction of the circuit court
could have been invoked by the state.
The real purpose of the suit was to annul the agreement and
suppress the combination alleged to exist between the defendant
corporations upon the ground that such agreement and combination
were in violation, first of the laws of Minnesota, and second of
the antitrust act of Congress. If relief had been asked upon the
ground alone that what the defendant corporations had done and
would, unless restrained, continue to do was forbidden by the
statutes of Minnesota, the circuit court of the United States could
not have taken cognizance of the case, for confessedly such a
controversy would not have been one between citizens of different
states, nor could such a suit have been deemed one arising under
the Constitution or laws of the United States.
The contention, however, is that a case arising under the laws
of the United States was presented by the allegation in the
complaint that the combination and consolidation between the Great
Northern and Northern Pacific Railway Companies and the control of
their affairs and operations by the Northern Securities Company
were also in violation of the antitrust act of Congress of July 2,
1890. An allegation in a complaint filed in a circuit court of the
United States may, indeed, in a sense, confer jurisdiction to
determine whether the case is of the class of which the court may
properly take cognizance for purposes of a final decree on the
merits.
Newburyport Water Co. v. Newburyport, 193 U.
S. 561, and
Pacific Electric Ry. Co. v. Los Angeles,
post, p.
194 U. S. 112,
decided at present term. But if, notwithstanding such an
allegation, the court finds at any time, that the case does not
really and substantially involve a dispute or controversy within
its jurisdiction, then, by the
Page 194 U. S. 66
express command of the act of 1875, its duty is to proceed no
further. That is manifest from the fifth section of that act, which
provides:
"That if, in any suit commenced in a circuit court or removed
from a state court to a circuit court of the United States, it
shall appear to the satisfaction of said circuit court at any time
after such suit has been brought or
removed thereto that
such suit does not really and substantially involve a dispute or
controversy properly within the jurisdiction of said circuit court
or that the parties to said suit have been improperly or
collusively made or joined, either as plaintiffs or defendants, for
the purpose of creating a case cognizable or removable under this
act, the said circuit court shall proceed no further therein, but
shall dismiss the suit
or remand it to the court from which it
was removed, as justice may require, and shall make such order
as to costs as shall be just."
18 Stat. 470. That provision has not been superseded by any
subsequent legislation.
Does the present suit really and substantially involve a dispute
or controversy properly within the jurisdiction of the circuit
court? That is to say, could the suit, as disclosed by the
complaint, have been brought by the state originally in that court?
If it could not, then, under the act of 1887-1888 and the adjudged
cases, it should not have been removed from the state court, and
should be remanded.
By the first section of the antitrust act, every contract,
combination in the form of a trust or otherwise, or conspiracy in
restraint of trade or commerce among the several states is declared
to be illegal. The second section condemns the monopolizing or
attempting to monopolize, or combining or conspiring to monopolize,
any part of such trade or commerce. By the third section, every
contract, combination in the form of trust or otherwise, or
conspiracy in restraint of commerce in any territory of the United
States or the District of Columbia, or in restraint of trade or
commerce between any such territory and another, or between any
such territory or territories and any state or states or the
District of Columbia, or
Page 194 U. S. 67
with any foreign states, or between the District of Columbia and
any state or states or foreign nations, is declared to be illegal.
A violation of the provisions of each section is made a
misdemeanor, punishable by a fine not exceeding $5,000 or by
imprisonment not exceeding one year, or by both said punishments,
in the discretion of the court. Of course, a criminal prosecution
under the act must be in the name of the United States and in a
court of the United States -- the district attorney who conducts
the prosecution being subject to the direction of the Attorney
General as to the manner in which his duties shall be discharged.
Rev.Stat. 362.
The fourth, sixth, seventh, and eighth sections of the act are
as follows:
"SEC. 4. The several circuit courts of the United States are
hereby invested with jurisdiction to prevent and restrain
violations of this act, and it shall be the duty of the several
district attorneys of the United States, in their respective
districts, under the direction of the Attorney General, to
institute proceedings in equity to prevent and restrain such
violations. Such proceedings may be by way of petition setting
forth the case and praying that such violation shall be enjoined or
otherwise prohibited. When the parties complained of shall have
been duly notified of such petition, the court shall proceed, as
soon as may be, to the hearing and determination of the case, and,
pending such petition and before final decree, the court may at any
time make such temporary restraining order or prohibition as shall
be deemed just in the premises."
"SEC. 6. Any property owned under any contract or by any
combination or pursuant to any conspiracy (and being the subject
thereof) mentioned in section one of this act, and being in the
course of transportation from one state to another, or to a foreign
country, shall be forfeited to the United States, and may be seized
and condemned by like proceedings as those provided by law for the
forfeiture, seizure, and condemnation of property imported into the
United States contrary to law. "
Page 194 U. S. 68
"SEC. 7. Any person who shall be injured in his business or
property by any other person or corporation by reason of anything
forbidden or declared to be unlawful by this act may sue therefor
in any circuit court of the United States in the district in which
the defendant resides or is found, without respect to the amount in
controversy, and shall recover threefold the damages by him
sustained, and the costs of suit, including a reasonable attorney's
fee."
"SEC. 8. That the word 'person,' or 'persons,' wherever used in
this act, shall be deemed to include corporations and associations
existing under, or authorized by, the laws of either the United
States, the laws of any of the territories, the laws of any state,
or the laws of any foreign country."
26 Stat. 209.
It thus appears that the act specifies four modes in which
effect may be given to its provisions. It is clear that the present
suit does not belong to either of those classes. It is not a
criminal proceeding (§§ 1, 2, 3), nor a suit in equity in the name
of the United States to restrain violations of the antitrust act (§
4), nor a proceeding in the name of the United States for the
forfeiture of property being in the course of transportation (§ 6),
nor an action by any person or corporation for the recovery of
three-fold damages for injury done to business or property by some
other person or corporation. (§§ 7, 8.)
But it is said that as the act of Congress was for the benefit
of all the states and all the people, this case is to be deemed one
arising under the laws of the United States, and therefore
cognizable by the circuit court, because one of the objects of the
State of Minnesota by its suit is to protect certain of its
proprietary interests, which, it is alleged, would be injured by
violations, on the part of the defendants, of the act of Congress.
Let us see what, in that view, is the case as presented by the
complaint.
The complaint alleged that the state is the owner of more than
three million acres of land, of the value of more than fifteen
millions of dollars, obtained by donation from the United States,
and that
"the value of said lands, and the
Page 194 U. S. 69
salability thereof, depends in very large measure upon having
free, uninterrupted, and open competition in passenger and freight
rates over the lines of railway owned and operated by said Great
Northern and Northern Pacific Railway Companies."
The bill also alleges
"that many of said lands are vacant and unsettled, and located
in regions not at present reached by railway lines, and depend for
settlement upon the construction of lines in the future; that it
has heretofore been the practice of said Great Northern and
Northern Pacific Railway Companies, respectively, to extend spur
lines into territory adjacent to each of said roads, as well as
into new territory, for the purpose of developing such territory,
as well as to obtain traffic therefrom; that such new lines have
been built in the past very largely by reason of the rivalry
heretofore existing between said companies for existing, as well as
new, business; that, under the consolidation and unity of control
hereinafter set forth, such rivalry will cease, and many of the
lands now owned by the State of Minnesota will not be reached by
railroads for years to come, if at all, owing to such combination
and consolidation removing all rivalry and competition between said
companies; that the settlement and occupation of said lands will
add very much to their value, and such occupation will depend
entirely upon the accessibility of railway lines and transportation
facilities for marketing the products raised thereon; that, if said
lands are sold and become occupied, they will add very largely to
the taxable value of the property of the state, and that said lands
cannot be so sold, or the income of the state increased thereby,
without the construction of railroad lines to, or adjacent to, the
same."
It was further alleged that the state is the owner of, and has
maintained at large expense, a state university, hospitals for the
insane, normal schools for teachers, a training school for boys and
girls, schools for deaf, dumb, blind, and feeble-minded persons, a
state school for indigent and homeless children, and a state
penitentiary; that a great portion of the supplies of every kind
for such institutions must, of necessity, be shipped
Page 194 U. S. 70
over the different lines of railway owned and operated by the
Northern Pacific and Great Northern Railway Companies; that the
amount of taxes which the state must collect, and the successful
maintenance of its public institutions, as well as the performance
of its governmental functions and affairs, depend largely upon the
value of the real and personal property situated within the state,
and the general prosperity and business success of its citizens,
and that such prosperity and business depend very largely upon
maintaining in the state free, open, and unrestricted competition
between the railway lines of those two companies.
The injury on account of which the present suit was brought is,
at most, only remote and indirect -- such an injury as would come
alike, although in different degrees, to every individual owner of
property in a state by reason of the suppression, in violation of
the act of Congress, of free competition between interstate
carriers engaged in business in such state; not such a direct,
actual injury as that provided for in the seventh section of the
statute. If Minnesota may, by an original suit in its name, invoke
the jurisdiction of the circuit court because alone of the alleged
remote and indirect injury to its proprietary interests arising
from the mere absence of free competition in trade and commerce as
carried on by interstate carriers within its limits, then every
state, upon like grounds, may maintain, in its name, in a circuit
court of the United States, a suit against interstate carriers
engaged in business within their respective limits. Further, under
that view, every individual owner of property in a state may, upon
like general grounds, by an original suit, irrespective of any
direct or special injury to him, invoke the original jurisdiction
of a circuit court of the United States, to restrain and prevent
violations of the antitrust act of Congress. We do not think that
Congress contemplated any such methods for the enforcement of the
antitrust act. We cannot suppose it was intended that the
enforcement of the act should depend in any degree upon original
suits in equity instituted by the states or by
Page 194 U. S. 71
individuals to prevent violations of its provisions. On the
contrary, taking all the sections of that act together, we think
that its intention was to limit direct proceedings in equity to
prevent and restrain such violations of the antitrust act as cause
injury to the general public, or to all alike, merely from the
suppression of competition in trade and commerce among the several
states and with foreign nations, to those instituted in the name of
the United States, under the fourth section of the act, by district
attorneys of the United States, acting under the direction of the
Attorney General, thus securing the enforcement of the act, so far
as direct proceedings in equity are concerned, according to some
uniform plan, operative throughout the entire country. Possibly the
thought of Congress was that, by such a limitation upon suits in
equity of a general nature to restrain violations of the act,
irrespective of any direct injury sustained by particular persons
or corporations, interstate and international trade and commerce,
and those carrying on such trade and commerce, as well as the
general business of the country, would not be needlessly disturbed
by suits brought, on all sides and in every direction, to
accomplish improper or speculative purposes. At any rate, the
interpretation we have given of the act is a more reasonable one.
It is a safe and conservative interpretation, in view as well of
the broad and exclusive power of Congress over interstate and
international commerce as of the fact that, so far as such commerce
is concerned, Congress has prescribed a specific mode for
preventing restraints upon it -- namely, suits in equity under the
direction of the Attorney General. Of the present suit the Attorney
General has no control, and is without any responsibility for the
manner in which it is conducted, although, in its essential
features, it is just such a suit as would be brought by his
direction when proceeding under the fourth section of the antitrust
act.
The state presents still another view of the question of
jurisdiction. Its complaint alleges that, if the Securities Company
be allowed to hold and control the stocks of the Great Northern
Page 194 U. S. 72
and Northern Pacific Railway Companies and to carry out the
purpose and object of its incorporation, full faith and credit will
not be given to the public acts of the state. This, it is
contended, presents a case arising under Article IV of the
Constitution, providing that "full faith and credit shall be given
in each state to the public acts, records, and judicial proceedings
of every other state." It is said by the state's counsel that
the
"gravamen of the charge in appellant's complaint is that the
defendants created a corporate device in New Jersey, and used it
for the purpose and with the result that property rights in
Minnesota were affected, in violation of its laws. Our contention
is that Article IV must be so construed as to make the
constitutional enactments of Minnesota effective throughout the
United States so far as they apply to and affect property rights
within the state. Otherwise the policy and laws of any state may be
easily evaded."
We do not think that the clause of the Constitution above quoted
has any bearing whatever upon the question under consideration. It
only prescribes a rule by which courts, federal and state, are to
be guided when a question arises in the progress of a pending suit
as to the faith and credit to be given by the court to the public
acts, records, and judicial proceedings of a state other than that
in which the court is sitting. Even if it be assumed that the word
"acts" includes "statutes," the clause has nothing to do with the
conduct of individuals or corporations, and to invoke the rule
which it prescribes does not make a case arising under the
Constitution or laws of the United States.
What was the duty of the circuit court when it ascertained that
the suit was not one of which it could take cognizance? The answer
is indicated by the clause of the Judiciary Act of March 3, 1875,
to which we have adverted.
For the reasons stated, we are of opinion that the suit does not
-- to use the words of the act of 1875 -- really and substantially
involve a dispute or controversy within the jurisdiction of the
circuit court for the purposes of a final decree.
Western Union
Tel. Co. v. Ann Arbor R. Co., 178 U.
S. 239,
178 U. S. 243.
That being the case, the circuit court, following the mandate of
the statute, should not have proceeded therein, but should have
remanded the cause to the state court.
The decree of the Circuit Court is reversed, and the case is
sent back with directions that it be remanded to the state
court.