Maryland and Virginia Milk Producers Assn., Inc. v. United States – Oral Argument – January 20, 1960

Media for Maryland and Virginia Milk Producers Assn., Inc. v. United States

Audio Transcription for Oral Argument – January 19, 1960 in Maryland and Virginia Milk Producers Assn., Inc. v. United States

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Earl Warren:

Number 62, Maryland and Virginia Milk Producers Association, Incorporated, versus United States, and Number 73, United States, Appellant, versus Maryland and Virginia Milk Producers Association.

Mr. Elman, you may continue with your argument.

Philip Elman:

Mr. Chief Justice, may it please the Court.

Before going on with the arguments on the law, that is the language and legislative history of the Capper-Volstead Act and the Borden case, which is a very important case here, since it’s the only case which has come before this Court since the enactment of the Capper-Volstead Act, which bears upon the relationship of that Act to the antitrust laws.

Before doing that, I should like to put the issues upon this case and its factual context and to review the facts in the record.

There is one preliminary point that may have been left uncertain by the argument yesterday afternoon and that is as to the role of the Secretary of Agriculture in relation to the acquisition of the assets of the Embassy Dairy.

It was suggested that the Secretary may have approved that acquisition.

Now, that question was specifically dealt with in the findings of the District Court to which there’s no challenge here and that’s to be found in the record on pages 493 and 494 of volume 2.

There, Judge Holtzoff deals specifically with the argument that the approval of a loan by the Baltimore Bank for Cooperatives, which was part of the Farm Credit Administration, represented the defense.

And the bottom paragraph of the page, mentions the fact as to that loan.

At the top of page 494, he says there is — the evidence does not sustain the defense for two reasons.

First, that there is no statutory provision empowering the Secretary of Agriculture to approve any transaction such as is involved here and secondly, the transaction was not authorized either by the Secretary of Agriculture or by anyone acting in his behalf.

And I might refer the Court, so far as the evidence —

What does the bank do?

Is it simply a commercial transaction — looks at it from a credit standpoint or what does it do?

Philip Elman:

Yes, solely from a credit standpoint.

And I — I think, if Your Honor will look at the record at page, 653, plaintiff’s Exhibit 114, where the bank, in connection with the pretrial proceedings here, was specifically asked.

This is question 1, the bottom of page 653 of the record, “Did the Baltimore Bank for Cooperatives, through its executive committee or otherwise, (a) authorize, (b) direct, (c) approve, (d) declare a fine to be in the public interest, or (e) sanctioned the acquisition of assets of Embassy Dairy, Incorporated, by Maryland and Virginia Milk Producers Association?”

Answer, this is the bank’s answer, “No.”

The bank did, however, approve and make a loan for the defendant.”

So, all you have is the making of the loan and there is no statutory authorization that either the association or the Government has been able to find, which permits the Secretary to approve such an acquisition.

And, he didn’t — and in any event, he did not purport to do so.

Now —

Hugo L. Black:

Well, if — if he had the power, did you — are you leaving your question, the first ground on which the Judge Holtzoff rested?

Philip Elman:

No, I’m not —

Hugo L. Black:

Not, what I was thinking was if — if he had the power to do it, it would be the same as though he had approved it, would it not, so far as the violation of the Act was decided, if he had the power to approve the acquisition?

Philip Elman:

Yes, assuming he did, which we don’t believe he had.

Hugo L. Black:

That — that you denied that he had the power.

Philip Elman:

We denied that he had the power, but even if he did have the power, he did not exercise the power so as to approve his acquisition.

Hugo L. Black:

Well, with (Voice Overlap) —

Philip Elman:

There’s no statute that we know of that gives him the power to approve an acquisition which will otherwise be in violation of Section 7 of the Clayton Act or Sections 1 and 3 of the Sherman Act, apart from the Capper-Volstead Act argument that’s made here in this case.

If the Capper-Volstead Act gives him that authority, then — then, of course, we have the question whether he — he exercised it here.

And we say, on the basis of the finding made by the Court here in the undisputed evidence, he didn’t.

Hugo L. Black:

Well, I was asking you the question with the idea that how you had to defend on your first point that he didn’t have the power.

Philip Elman:

We depend on both.

Hugo L. Black:

If Congress confided the power to the Secretary of Agriculture to pass on these things, I suppose it wouldn’t be proper to test it out through a violation and only charge him for violating the antitrust laws.

Philip Elman:

Well if — if it’s true that the Capper-Volstead Act give — does give the Secretary of Agriculture the power to immunize from the antitrust laws an acquisition that would otherwise violate those laws then, if he did grant such immunity, of course, that would be a full defense.

But, you see —

Hugo L. Black:

But, I —

Philip Elman:

You see, there are two — excuse me.

Hugo L. Black:

It may be that — I certainly haven’t made my idea clear.

Philip Elman:

Well, I think it would fall in line.

Hugo L. Black:

Is it — no, I think it’s fine.

There are two arguments that he made and I understand you’re making.

The first one, I think, is wholly a complete defense if you’re right that he has no power to authorize this to be done.

But, if that power has been given, might it not be construed as to mean that that was the regulatory method that was to control the acquisition of the dairy?

Philip Elman:

Yes, and — yes, sir.

And I think that is just another way of presenting their argument that the grant of power to the Secretary under Section 2 of Capper-Volstead, that grant of power is equivalent to taking out from under the antitrust laws the question of the legality of — of the activities including the acquisition.

Hugo L. Black:

Well, you deny, do you not, that he had the power under the Capper-Volstead Act?

Philip Elman:

Yes, sir.

Hugo L. Black:

To authorize this acquisition?

Philip Elman:

We certainly do.

Felix Frankfurter:

Do you further say that that whatever power he had under Section 2 of Capper-Volstead to approve must be exercised explicitly as an approval and it can’t be inferred from the fact that the bank which loaned him money to make this transaction possible was using government funds?

Do you reject that?

Philip Elman:

Well, it’s not only not possible to draw that inference, the bank itself, contradicts the drawing of any such inference.

Felix Frankfurter:

Well, I’m — I’m suggesting that the banks, if using government funds, entirely means a proof.

The banks disavowed of approval couldn’t change that legal fact.

Philip Elman:

I think that the bank’s action in this case, as it fully appears from the memoranda surrounding this transaction and its — its own statement, the bank was concerned with the financial wisdom or unwisdom of this —

Felix Frankfurter:

Quite properly, financial.

Philip Elman:

This thing —

Felix Frankfurter:

— suggesting there’s an implicit legal problem issue that the mere use of government funds does not constitute an approval.

Philip Elman:

That’s right.

Felix Frankfurter:

Alright.

Philip Elman:

I fully agree.

Now, as to the facts, as we stated yesterday, we have three causes of action here.

One of them was not tried.

That’s the Section 2 of the Sherman Act, monopolization charge which, as I said, from our standpoint is the most important phase of this case.

The —

Potter Stewart:

May I ask you, Mr. Elman?

Do you say that would cause you to the remedy which is a relief broader than the finding?

Philip Elman:

Yes, sir.

Potter Stewart:

That’s the — that would lead you to it.

Philip Elman:

Yes, sir.

From our stand — from our standpoint, the Embassy — the acquisition in 1954 from the Embassy assets was about one — perhaps the most significant and most dramatic, but it was about one part of a — an attempted monopolization which, according to the allegations of the complaint, began in 1930 and the relief that the Government is seeking for the protection of other cooperatives and for the protection of independent farmers who are not members of this cooperative would be, we believe, far more effective and far more beneficial to them and to the public than the mere divestiture that was ordered here.

Potter Stewart:

Well, how was it far beyond divestitures, divestitures put under suit would be part of it, wouldn’t it?

Philip Elman:

Yes, sir.

Potter Stewart:

Of what condition?

Philip Elman:

Well, it would — it would include an injunction against the — the acts and similar acts such as there are alleged in the complaint.

And, I would like to go immediately to the allegation in the complaint here as to what was done.The complaint as to Section 2 alleged that this association which was organized in 1923 has, from — at least from 1931 to the present time, controlled somewhere between 85% and 95% of the supply of milk in the Washington Metropolitan Area.

The exact figure has varied from time to time.

And this cooperative, which as close to 2,000 members, has never achieved a 100% monopoly in the sense that every farmer in the Maryland and Virginia producing area became a member.

At all times, they were independent farmers who chose not to become members of the association, who preferred to sell either directly to the dairies, the distributors, or through some other cooperative.

Now, this is — this cooperative is of course, by far, the largest cooperative in this area but it is not the only one.

There are three other such cooperatives which are here now and which have tried, from time to time, to gain a foothold in the market, and one is the Capital Milk Producers Cooperative which sells to the High’s retail stores.

There’s the Valley of Virginia Cooperative which sells through Alexandria Dairy, and there’s Queen City Cooperative that sells through the Harvey’s Dairy.

And, these other cooperatives are cooperatives of the same farmers that you have in this association farmers in the Maryland and Virginia area, and the gist of the monopolization charge here is that this defendant-association has used its dominant position in controlling the supply of milk in this area.

Could I ask you this question?

Supposing you had nothing in this case other than the fact that this association was 100% — included 100% of the producers?

Philip Elman:

Absolutely nothing else?

Nothing else, could you maintain this action?

Philip Elman:

No, sir.

If all you have here —

So, the fact that —

Philip Elman:

Is a voluntary —

The fact — the fact of a monopoly as such, just the bare monopoly arising from voluntary — voluntary aggregation of 100% of the producers, doesn’t get you anything.

Philip Elman:

Well, let me be sure that I understand your question correctly and that you understand my answer correctly.

If you have a purely voluntary joining together of the farmers —

Yes.

Philip Elman:

For the purpose of collectively marketing their milk —

Yes.

Philip Elman:

That’s all you have —

Yes.

Philip Elman:

You have nothing directed in the way of — practice as directed against nonmembers or people who might choose to leave the association, nothing in the way of eliminating competition —

Right.

Philip Elman:

At the wholesale level, no denial of access to the market by anybody else, in other words, we’re taking out of this case everything that makes the case what it is and why it’s here.

If you take everything out of the case —

That’s my question.

Philip Elman:

Except that voluntary —

Except the monopoly.

Philip Elman:

Except the monopoly.

Felix Frankfurter:

The monopoly of what?

Philip Elman:

A monopoly — a monopoly as to the marketing of milk by members who have voluntarily joined together, and —

Felix Frankfurter:

That’s what Capper-Volstead did in the charter of association.

Philip Elman:

Charter of association.

Felix Frankfurter:

Legislative charter of association and the statute doesn’t put any limit as to how many can belong to this voluntary association.

Philip Elman:

It is also a charter of non-association —

Felix Frankfurter:

But then —

Philip Elman:

Insofar —

Felix Frankfurter:

Certainly —

Philip Elman:

Insofar as in —

Felix Frankfurter:

It could be clumped into it.

Philip Elman:

That’s right.

They can — so far as the — as the farmers who — who voluntarily want to join the association are concerned, any elimination of competition among themselves as to fixing of price is perfectly alright.

And —

My question went no further than that.

That was all.

Philip Elman:

But the gravamen of this case, the gravamen of the charge here is that they used their voluntary combination which Capper-Volstead authorizes to club nonmembers into — into leaving the market or joining the association, giving them that choice.

Now, we say that there’s nothing in Section 1 of the Capper-Volstead Act, which is the source of the immunity here, which authorizes anything going beyond the voluntary association you’ve cited in —

Hugo L. Black:

And how was it coming to that?

Philip Elman:

Well, I hope Your Honors will bear with me if I —

Hugo L. Black:

If you don’t —

Philip Elman:

— take you through the record.

I’d like to be as specific as I can about rather than using generalities —

Hugo L. Black:

I don’t want to disarrange your argument.

I —

Philip Elman:

You’re not — you’re serving —

Hugo L. Black:

That the —

Philip Elman:

You’re serving my purpose, Mr. Justice.

I — I could summarize the allegations of the complaint here by saying that the — it alleged that they obtained, maintained, and extended their monopoly power through the use of activities for the use acts which were not authorized by Section 1 of the Capper-Volstead Act and which, if done by an ordinary business corporation concededly, would be unlawful under the antitrust laws.

That’s the broad outline.

Now, what did the — what did the complaint say specifically?

If the Court will refer to Volume 1 of the record, page 17, you will find the allegations dealing with Section 2.

Paragraph 21 recites generally the beginning in 1930 and continuing thereafter up to an including the time of the complaint, the defendant has attempted to monopolize and has monopolized interstate trade and commerce in the supply of milk for resale as fluid milk in this area.

Paragraph 22 specifies 10 respects in which that attempt of monopolization was carried out.

I will refer only to two of them Subparagraph (b) of paragraph 22, that the defendant has excluded, eliminated, attempted to eliminate others, including producers, its farmers, and producers agricultural cooperative associations not affiliated with the defendant from supplying milk to dealers, dealers being the word for “dairies” like seal tests, counts, and so on.

Subparagraph (k), on the next page, the defendant has eliminated and attempted to eliminate competition with its dealer customers by dealers purchasing milk from others than the defendant.

On paragraph 25 (c), on page 19, under violations of Sections 1 and 3, subparagraphs (a), (b), and (c) referred to the Embassy transaction.

And, (a) and (b) alleged the making of the contract, the agreement by the owners of Embassy that they will not engage in the sale or distribution of milk in this area and paragraph (c), the defendant and co-conspirators, that’s the owners of Embassy, made arrangements for and assisted in the diversion or foreclosure of producers of milk who had supplied Embassy from independently supplying their milk to the Washington Metropolitan area market, giving such producers the alternative of supplying co-conspirators, Green Spring Dairy, Inc. at Baltimore.

That’s the dairy that was owned by the owners of Embassy in Baltimore, giving them the choice of either going to the Baltimore market or becoming members of the defendant [Association].

Again, on page 20 in the following paragraph, paragraph 26, it’s again alleged that this contract, I’m reading now from the last sentence of the first paragraph, “the aforesaid contract was made and executed by the defendant for the purpose of eliminating Embassy as an outlet in the Washington Metropolitan area for milk produced by others than the Defendant and for the purpose of eliminating competition in said area between Embassy and dealers purchasing the requirements of milk from the defendant.”

Philip Elman:

Now there were extensive pretrial proceedings here.

Judge Holtzoff ordered the Government to supply particularizations of these general allegations, and the Government furnished a statement of particulars and three supplements to that statement of particulars.

They appear in the record beginning at page 35.

The statement of particulars starts at 35 and goes on to 5 — page 57.

The supplements begin at page 68.

And, there are, by my count, 143 specific acts specified, particularized under the general allegations of the complaint.

And as I indicated yesterday, all this must be taken as proof for the purposes of this case since the defense of immunity was sustained without committing the allegations to be tried.

You —

Felix Frankfurter:

Mr. Elman, may I ask whether the Maryland and Virginia Milk Producers Association had the equivalent, if it were a corporation, well, it is a corporation, articles of incorporation setting forth its purposes?

Philip Elman:

Yes, sir.

Felix Frankfurter:

Where is that in the record?

Is that in the record?

Well — I’ll go to my —

Philip Elman:

I — I’m not sure —

Felix Frankfurter:

I’ll go to my question.

Philip Elman:

Whether it is in the — whether it’s in the printed record or not but I think it’s in the record that’s filed with the Court.

Felix Frankfurter:

Well, I’ll go to my question.

If one takes that as a definite — as a particularization of the purposes of this association, would the items which you’ve just made before the Court, as transgressing its powers, would there be a conflict in what they purported to exist for and what the Government charged him with this?

Philip Elman:

Yes, sir.

We think — we think that —

Felix Frankfurter:

Therefore, I should think the articles of incorporation are rather important in that point.

Philip Elman:

Well, we think that if the articles of incorporation had said that our purpose is to eliminate the competition of nonmembers, then there would be a conflict between that authorization and the authorization given to the cooperative by Section 1 of Capper-Volstead.

Felix Frankfurter:

Yes, but I didn’t ask that question.

Philip Elman:

But, I don’t think that’s what this is.

Felix Frankfurter:

That’s what they seldom do.

The article might violate the law from your point of view.

What I want to know is whether their profess purposes, as formulated in the articles of incorporation —

Philip Elman:

Yes.

Felix Frankfurter:

— are in conflict with what you — the itemization of illegality that you’ve just —

Philip Elman:

Well, I can’t answer your question without looking at the charter of the corporation but I would be very much surprised if it’s — if there were anything in it that said the purpose of the cooperative is to monopolize and to club nonmembers.

Felix Frankfurter:

If it isn’t in print, then it’s in the — would you mind giving us —

Philip Elman:

I’d be very happy to furnish it now.

Felix Frankfurter:

Because that might be —

Philip Elman:

Well, our argument —

Felix Frankfurter:

I mean, it is one yardstick of measurement.

Philip Elman:

Well, we don’t —

Felix Frankfurter:

Do you open the question that you raise that if by then by setting forth the illegalities, they couldn’t make them legal?

Philip Elman:

Yes.

Felix Frankfurter:

But if they didn’t — if they set forth things that are wholly innocent —

Philip Elman:

Well, perhaps I can — I can relieve your mind by saying that we do not argue, so far as I know, and have not argued in the court below that there’s anything in the charter of incorporation which is the basis for illegality.

The basis for lega — the illegality is —

Felix Frankfurter:

That’s —

Philip Elman:

— what they did, not what they started out in 1923 saying they were going to do.

Felix Frankfurter:

I understand that.

My point is that the — they may be measured in what they did, by what they professed in the articles of incorporation as the cause of their distance.

Philip Elman:

Yes.

Well as to what they actually did, I hope the Court will indulge me to the extent of a few minutes to refer to some of these specific items that are stated in the Government’s statement of particulars.

Page 38, under subparagraph (b) of paragraph 2, the allegation of excluding, eliminating, attempting to eliminate, others from supplying milk to dealers.

Subparagraph — paragraph 5 on page 38 refers to an incident during the period 1938 to 1940, the Fairfax Farms Dairy or Embassy Dairy, the defendant required that they agree not to purchase milk from producers or suppliers in addition to those producers or suppliers that they were then supplying.

And, on page 39, paragraph 7, they attempted to arrange with James J. Ward, he was the owner of Embassy, that producer supplying milk to Embassy would be switched to the Baltimore market and, paragraph 8, an allegation that they attempted to prevent or interfere with the shipment of milk to the Washington area market by producers not members to the defendant Association, particularly, by attempting to prevent or interfere with the transportation of milk of nonmember farmers on the truck of that named dairy and others.

Paragraph No.9, activities directed against another co-op, activities to exclude Valley of Virginia Producers Association as a supplier of milk, the same kind of allegation in paragraph 10.

Now, if I may —

Earl Warren:

Was there any — anything in the record to indicate what the — what that effort to prevent the truck from —

Philip Elman:

These weren’t tried.

Earl Warren:

How important it is —

Philip Elman:

It wasn’t tried.

It wasn’t tried, Mr. Chief Justice.

Earl Warren:

They’re not —

Philip Elman:

And, as far as I know, there wasn’t any interest at that time.

Now, on the next page, as one of the allegations under the monopolization charge, paragraph 14 refers to the acquiring of assets of Embassy Dairy in the — 1954, and arranging for the diversion from the Washington market or absorption in the defendant Association of milk producers who supplied Embassy as independent suppliers of milk and foreclosing from the Washington market of other suppliers of milk who also furnished milk to Embassy.

Philip Elman:

Page 42, there’s another allegation the Court might be interested in.

Paragraph 13 on page 42 of the record, such charge that the defendant Association threatened and induced the boycott by dairy farmer members of defendant of feed and farm supply outlets owned by one Herbert Bryan in or about 1956, which was two years after the acquisition of Embassy in order to compel Eastern Dairy Products Corporation of Alexandria, Virginia, also owned by Bryan, to purchase from Defendant milk for resale as fluid milk.

If I may jump now to page 57, which is one of the supplements to the statement, charged that the defendant has eliminated and attempted to eliminate competition with its dealer customers, paragraph 1, by refusing to sell milk to High’s Dairy, Washington, D.C., in or about the period 1935 to 1940 on the grounds that said High’s Dairy sold and proposed to sell milk at retail prices below those charged by other Washington area dealers who were customers of the defendant, who were buying their milk from the defendant Association.

Let me — let me jump now to page 71.

I think this will — I don’t want to impose on the Court’s time, but I think this will — this should conclude my statement of the bill of particulars here.

On page 71 of the record, the Government made these further allegations, which it did not have an opportunity to prove.

Paragraph 14, preventing or attempting to prevent milk of nonmember farmers from being transported to the Washington area market by prohibiting member’s milk from being shipped in trucks of independent contract callers which transported milk of nonmembers in or about the period 1953-1957 which, again, goes beyond the date of the acquisition of Embassy.

The next paragraph, attempting to induce or cause Coleman C. Gore to cease the business of supplying milk of independent producers to Washington Metropolitan area dealers in 1943.

Paragraph 17, attempting to do — induce Mullin Curt, IV, the field representative of a Green Spring Dairy of Baltimore to cause former suppliers of Embassy, who were diverted from the Washington area market by the acquisition of the Embassy, and who might be considering resumption of shipments of milk to the Washington market, to do so through the defendant Association, and so on.

Well —

Could I ask you a question to this point?

Philip Elman:

Yes, sir.

These particulars that you’ve been pointing out all relate to the monopoly charge.

Philip Elman:

Not at — no, not entirely.

Not entirely.

Philip Elman:

That they —

Of course you’ve got your relief.

Philip Elman:

The duplication here, many of these particulars relate to not only the acquisition of Embassy, for example, is cited as a violation of all three provisions of the antitrust law.

My question is this.

You — you say that — you said yes in answer to Justice Whittaker’s question, that you were — you considered the monopoly charge very important from the standpoint of your position on the relief.

Therefore, I would suppose that if you — we sustained you on the monopoly charge, in other words, the exception is not applied and that you’re entitled to have an opportunity to prove these allegations, I should think the question of relief, at least to the extent that it depended upon your proving the particulars that concerned the monopoly charge is distinguished from the counts on which you’ve won would have to wait the trial of these issues.

Philip Elman:

Well, the theory — the theory of the monopoly charged is essentially the one that was declared by the Court in the Griffith case that monopoly power, even if it’s lawfully acquired, cannot be used for the purpose of destroying a competitor for foreclosing it in the market now.

But all of this is subject to proof that what you’ve alleged here is the fact.

It hasn’t been proved.

Philip Elman:

We have —

Your monopoly power, as such, is something that’s immunized, as you agreed this morning —

Philip Elman:

If it’s voluntarily obtained.

If it’s voluntary, but do you said all this stuff shows that this goes beyond the voluntary characteristics, therefore, you ought to have more relief.

Philip Elman:

Yes, sir.

And I’m suggesting that these allegations, so far, are nothing but allegations and they haven’t been tried out.

Philip Elman:

And all we’re asking for is an opportunity to try them out.

Yes, but then you don’t reach the question of extending relief until you do try them out.

Philip Elman:

Well, we’re not asking —

Do you think that it depended on another?

Philip Elman:

We’re not asking — we’re not asking Your Honors to write a decree on Section 2 at this stage.

All we want —

Well, then I misunderstood you.

Philip Elman:

Oh no.

Earl Warren:

You were going to say all you want, will you continue that, —

Philip Elman:

All —

Earl Warren:

— please?

Philip Elman:

Well, precisely, what we want on Section 2 is a decision by this Court that the District Court erroneously sustained the def — the affirmative defense.

He disposed of the Section 2 case on the pleadings.

And, at the Section 2, this is a pleadings case and if Your — if the Court agrees with the Government, all we’re entitled to is an order sending the case back for trial.

I misread your brief.

I thought you —

Philip Elman:

But —

addressed is professionally.

Philip Elman:

No.

Mr. Justice Whittaker’s question, as I understood it, was whether we couldn’t get everything that we wanted under Section 3 of the Sherman Act and Section 7 of the Clayton Act.

The answer to that question was no.

Charles E. Whittaker:

Well, the question that I ask you, if I may, Mr. Elman, are you dissatisfied then with the relief given you by the Court as respect to counts 2 and 3 —

Philip Elman:

Yes.

Charles E. Whittaker:

— standing alone?

Philip Elman:

Yes.

We — we have — we have included in our cross appeal here certain questions as to the adequacy of the Section 3 relief, the relief as to divestiture of the Embassy assets.

Those are minor questions.

I — I would prefer to leave them to the brief, but I will discuss them if I have an opportunity later on there.

Charles E. Whittaker:

I just wanted to —

Philip Elman:

I don’t think there are of any considerable magnitude.

Philip Elman:

The provisions that we think the District Court should have included in the decree but didn’t, from our point of view, are standard routine antitrust provisions and there was no responsible exercise of discretion on his part to keep them out —

Charles E. Whittaker:

Well, frankly, the only one I see is your claim of a right to visitation.

Philip Elman:

Yes, sir.

Charles E. Whittaker:

Isn’t that about all?

Philip Elman:

I think that’s probably the most important one, but where we stand as to all the objections to the decree that are in our brief.

As to visitation, for example, if I may take a moment to deal with that since it’s been raised, the Government prop — which had won Section 3 and Section 7, and there was no question about the divestiture, the District Court.

And the defendants recognized that where there’s a violation of Section 7, the proper relief is divestiture.

We had included a provision that the Government would have the right to inspect the books and records of the Defendant-Association at its office, at its convenience, and so on.

And, we thought that was an important provision because the decree had standards into this for the good faith of the association, and so on.

That kind of provision in the antitrust decree is included in every consent decree that I’ve seen.

It’s — it’s and as I say, routine standard and there’s no requirement.

It isn’t mandatory that it be included.

This Court in the Bausch and Lomb case in 321 U.S. said that the District Court had some discretion in the matter.

And if Judge Holtzoff had exercised the discretion here, if he had said, I — I don’t think that it’s necessary or appropriate here and on the basis of what we had in the facts here,” that — that would be an entirely different situation.

What — what he said was, as I — he looked at this provision, he said, “I think this is a police state provision.

This is unreasonable searches and seizures.

Well you couldn’t ask.

You couldn’t impose this requirement on criminals, so you shouldn’t be able to impose it on honest businessmen.”

The word “honest” was his word, not mine.

And he thought, in effect, that it was mandatory to omit that provision from the decree.

And as I say, if it’s an — if it’s a question of discretion, if he had exercised discretion, we wouldn’t be objecting.

But he — I mean, that’s — that’s the — that’s the kind of question we have on the relief and I would like to leave them to the brief.

Mr. Elman, if you just, one question, and I don’t want to take up your time, but to declare my — my own — I think, perhaps, I misunderstood your answer to the question.

Assuming that you don’t prevail on your appeal and the case is left where it now is, as far as the merits are concerned.

You said you didn’t ask us to write a decree at this stage.

In that hypothesis, would you ask us to broaden the relief?

Philip Elman:

Yes.

On Section 3 of the Sherman Act and Section 7, that part of the case was tried.

There, you have a decree and we are saying that that decree —

Alright, I understand now.

Philip Elman:

— was not fully effective to undo the violations which the District Court found, and that is properly before you for —

Felix Frankfurter:

And you’re not saying —

Philip Elman:

— modification.

Felix Frankfurter:

— and you’re going beyond saying that it should be sent back to Judge Holtzoff to exercise a discretion.

You say it’s getting on, we might as well deal with it.

Philip Elman:

As for the —

Felix Frankfurter:

Are you saying that?

Philip Elman:

Section 3 —

Felix Frankfurter:

I understand.

Of course, you don’t ask for a decree on a case that hasn’t been tried.

Philip Elman:

Well, may I — may I say this, I — that the — that the questions as to the decree, the inadequacy of the decree that we have raised, would also arise, we think, for example, this visitation provision, would also arise under a Section 2 decree, if you’re — if the Court were to send the case back under Section 2 and if we won and the — and the judge were to give us a decree, you’d have the same question.

We thought that since it was, from our point of view, the case has got to go back anyway, it might be helpful to give the Court guidance not only as to the Section 2 part which isn’t quite ready for Your Honors’ decision as to the decree —

Charles E. Whittaker:

Mr. Elman —

Philip Elman:

— but as to the Section 3 and Section 7 which is before Your Honors.

Felix Frankfurter:

But we couldn’t say more than you’ve indicated, namely, that, as a matter of law, he’s not divided evidently he thought he was divided from adding those other provisions.

Philip Elman:

That’s right.

Charles E. Whittaker:

Mr. Elman —

Philip Elman:

Justice —

Charles E. Whittaker:

May I ask you to — as I understand you, you say the case must go back in any event.You therefore, treated as one case, do you?

Philip Elman:

Well, it’s one case.

It’s one complaint and one —

Charles E. Whittaker:

Alright.

How many —

Philip Elman:

— trial, but there were — there were separate judgments as to Section 2 in the Sherman Act.

Charles E. Whittaker:

Separate judgments or separate counts treated in one judgment?

Philip Elman:

No, they’re separate judgments.

Charles E. Whittaker:

Other?

Philip Elman:

Page 74 and 75, you have the judgment of the Court as to the —

Charles E. Whittaker:

74?

Philip Elman:

Record 74 and 75 is a judgment, dated November 10th, 1958, as to Section 3 of the Sherman Act and Section 7 of the Clayton Act.

Philip Elman:

No, I beg your pardon.

That’s the judgment as to Section 2.

He sustains the defense of Capper-Volstead as to Section 2, the monopolization.

And then, on page 85, he has his judgment as to — in favor of the Government.

Charles E. Whittaker:

Well, then, that’s treated as being separate suits, aren’t they?

Philip Elman:

Well, but I know —

Charles E. Whittaker:

Because there could only be one final judgment in the case.

Philip Elman:

No, I think — I think it’s one suit, Mr. Justice.

You have complaint setting forth three causes of action, but I don’t think that makes it three lawsuits.

Charles E. Whittaker:

No, but it’s three causes of action.

It’s three separate causes of action —

Philip Elman:

Yes.

Charles E. Whittaker:

— under one complaint.

Philip Elman:

Yes, sir.

That’s right.

Now, up to now, I’ve talked about allegations which haven’t been tried.

There are findings of fact here as to the acquisition of the Embassy Dairy’s assets in 1954.

That was fully tried.

You have — there was extensive oral testimony by the parties to the transaction.

There were documentary exhibits and, particularly, significant with those referred to by the District Court in his opinion, which is in the record at page 480.

There were contemporaneous memoranda furnished by the directors of the association to its members and to this Baltimore Bank for Cooperatives which described the reasons for this acquisition, so that, we have a very full factual record on that phase of the case.

Now, what was the situation as to Embassy?

In 1954, the Defendant-Association controlled 86% of the supply of milk in this area.

There were about a dozen dairies distributors to whom — who were, in effect, the wholesalers of milk.

The big three, the three largest Chestnut Farms, Thompsons, Lucerne which is Division of Safeways, in which, themselves, counted from well-over 70% of the sales of milk in this area.

They bought all or practically all of their milk from the defendant Association.

There were some other dairies.

The fourth largest dairy was Embassy.

Embassy had about 10% of the market.

86% to the association, 10% Embassy, and this leaves 6% for the remainder, and I don’t think it’s very significant in the context of this case but Embassy was important because Embassy did not buy from the association.

Philip Elman:

Embassy bought its milk from 122 independent farmers who are not members of this Association.

Embassy was a vigorous aggressive competitor, in relation to the customers of this Association.

Embassy cut prices, particularly, in the sales of milk to the Federal Government for using in federal installations in this area like Fort Myer and old soldiers’ home, and so on.

The Federal Government bought about $2 million worth of milk each year and Embassy, which was — which was the number four dairy in the area, was able to get 47% of that business.

And, it was able to do that because it submitted low bids.

The association’s customers were able to sell only 45% to the Government and, in order to get hat 45%, they had to reduce their prices to the level of Embassy’s bids.

And in — and in order to permit that arrangement, the association had to reduce the price that it was charging its customers.

I hope I’ve made that clear.

It’s fully spelled out in the memorandum which the general manager of the association submitted to the members of the association in 1954 in explaining why they wanted to acquire Embassy.

This is on page 542 of the record.

He says there that “the fact that Embassy was buying its milk from these independents was costing the association about $700,000 a year.”

Then, in the next paragraph, he said that “It isn’t limited to the fact that Embassy is not buying its milk from us.

There’s this contract milk which is sold to the Federal Government.

As a result, of the Dairy’s, that’s Embassy’s, ability to under-buy and, therefore, undercut in their bidding, it has been necessary for the association to drop the price to a competitive level.

That is, to the price of Embassy’s able to buy their milk.”

And, that that — this is costing the association something like $2 million a year.

The District Court found that this acquisition of Embassy’s assets, which were worth $1,600,000, was for the purpose of eliminating the competition of the 122 producers.

As a result of the acquisition, these 122 farmers, the District Court found, were compelled to leave this market or to join the association.

The — the purpose of this transaction is abundantly demonstrated by the record.

There was a testimony by the President of Thompsons Diary, for example.

That while the negotiations were in progress, he was approached by the manager of the association and he was told that he should not attempt to acquire the — to buy his milk from the — from any of these 122 farmers who have been shipping to Embassy because that would “queer” the deal.

The memoranda submitted to the bank all showed that the purpose of this transaction was to foreclose these independent markets, to cut off their normal market outlet, to give them the choice either of leaving the Washington market, as many of them did, or of joining the association.

Now, as far as —

It varies as to what its underscoring is, isn’t it?

Philip Elman:

That underscoring was — was made for the benefit of the District Court.

The significant portions were underscored and that’s the way it was printed.

Now, I would like to spend just a minute or two of my remaining time to say something about the Borden case in the legislative history.

The Borden case was not a case which holds, as the defendant argues, that there is an absolute sweeping exemption from the antitrust laws for cooperatives but it doesn’t go so far as to immunize combinations involving outsiders.

The very same arguments that are being made here that Section 2 entirely displaces the antitrust laws, that it gives a remedy which is exclusive, was better than — that Section 2, in effect, denies persons who are injured by actions such as these.

Independent farmers who were driven out of the market by clubbing tactics, that they have no action for damages, that there’s no criminal action, as in Borden.

Philip Elman:

That is very same argument was accepted by the District Court in the Borden case and the — this Court, in the unanimous opinion by Chief Justice Hughes said, “We are unable to accept that view of Section 2.

Section 2 is merely a qualification on Section 1.

Section 2 is intended to serve the purpose of protecting the public against the excessive prices where the activities permitted by Section 1, in the opinion of the Secretary of Agriculture, unduly enhanced prices.

That Section 2 is a valuable provision because without it, there would be no protection for the public as to activities which are authorized by Section 1.

But, if it’s — it distorts the whole function and scope of Section 2 which, incidentally, has never been used by the Secretary of Agriculture that we have — that we don’t have the benefit of any administrative interpretation or construction of it.

Section 2 is not the provision which in it — which repeals antitrust remedies.

That, I can say to that only, that this — this argument was fully made to this Court in the Borden case.

The legislative history materials, which are relied on here, were — were presented to the Court in the briefs of the Borden Company and the Pure Milk Company.

The Court considered them.

The Court had the District Court decision before accepting that argument and it rejected it.

And, if the — all Your Honors have to do is reread the Borden case to see that.

Thank you.

Hugo L. Black:

May I ask you just one question?

Philip Elman:

Yes, sir.

Hugo L. Black:

(Inaudible) does your argument, the contention which you made, result in subjecting cooperatives to the Antitrust Act upon the conditions by a labor union who were held exempted in the Hutcheson case?

Philip Elman:

We think that the situation of the labor union is entirely dissimilar.

You’ve got a different history as to labor unions.

Labor unions aren’t engaged in the marketing of commodities, to begin with.

As to labor unions, Congress, as this Court held in the Allen Bradley case and the Hutcheson case, enacted the state statutes and it’s upon the Clayton Act, Norris-LaGuardia, then of course, we have the National Labor Relations Act in that part, the Act of 1959.

There’s a different minor growth in the last brief of labor unions.

All you have, as to agricultural offers, is the Capper-Volstead.

Now, you also have the Agricultural Market Agreement of 1957 which deals with this problem of protecting cooperatives and protecting farmers, generally, from the — against the (Inaudible) of disability in farm places and so on.

The Congress (Inaudible) to buy in the market would have happened in most agreements which had certain procedures(Inaudible).

In 1957, the agricultural market agreements were to be approved by the Secretary.

It is (Inaudible)

There, it had the clearest (Inaudible) Capper-Volstead would not (Inaudible) given to agricultural cooperatives by the antitrust laws as immunity.

It has a limited function and, that is, the act of an agreement (Inaudible).

Felix Frankfurter:

What did the courts (Inaudible)

Philip Elman:

(Inaudible)

Felix Frankfurter:

(Inaudible) policy there.

Philip Elman:

Yes, sir.

Felix Frankfurter:

Which do not exist here?

Philip Elman:

You have nothing at all comparable to those legislative —

Felix Frankfurter:

Wasn’t there —

Philip Elman:

— acts here.

Felix Frankfurter:

Wasn’t there a suggestion — wasn’t there a suggestion in both the House and Senate reports that, perhaps, a proper construction of the Sherman Law would authorize cooperatives pursuing nearly the function of voluntary association and tells its interest to the proper construction of the Sherman Law but not to include (Inaudible) Capper-Volstead Act (Inaudible) with the cooperative explicitly out of condemnation of the Sherman Law.

Philip Elman:

That’s right.

The big — the big ambiguity that was resolved by the Capper-Volstead Act is how far the “legitimate” object to the association, provision under Section 6 of the Clayton Act, go and they wanted to make sure that the members of a cooperative could — could voluntarily join together, set up a single marketing agency, market their products with a single price, which would otherwise violate the antitrust laws, and make sure that did not violate the Antitrust laws.

But, the — the House Committee report, which is quoted on page 21 (a) of the association’s voluminous appendix on legislative history, after referring to that purpose, says that in the event that associations authorized by this bill shall do anything forbidden by the Sherman Antitrust Act, they will be subject to the penalties imposed by that law, not the penalties imposed by Section 2, the penalties imposed by the Sherman law.

Felix Frankfurter:

Well, how do you —

Philip Elman:

Well that’s a far cry from the — from saying that the legislative history is conclusive that Congress intended to take foreign cooperatives entirely out from under the antitrust laws.

Felix Frankfurter:

Well, I was referring, particularly, to what Senator Walsh of Montana has said, speaking for the Committee, if there — if, indeed, there’d be any objection, he didn’t refer to the Sherman law as such but he indicated that it was doubtful whether a classical, what I call a classical cooperative, would be condemned by the Sherman law, if it merely restrict itself to doing what a cooperative does, namely, serve a common interest to voluntary membership.

Philip Elman:

Well, may I — may I answer that as to Sec — Senator Walsh.

Senator Walsh was the Chairman of the Senate Judiciary Committee which was opposed to Section 2.

Felix Frankfurter:

2, yes.

Philip Elman:

He was not a sponsor of the provision which is relied on here.

Senator Walsh was — and the Senate Judiciary Committee were concerned that a cooperative might form a monopoly of the — of supply just through the voluntary aggregation of the farmers, and that’s where the — that’s what they were worried about and they were defeated.

However, on the question of whether a cooperative which had obtained the monopoly could use that monopoly to drive out nonmembers through unfair methods of competition, you have a statement on page 39 (a) of the appendix.

That of course, if this association shall practice unfair methods of competition for the purpose of driving their competitors out of business, I dare say, they would still be amenable to discipline under the Federal Trade Commission Act, at least I hope so.

But, Mr. — President, that is not the situation which presents itself at all.

The Federal Trade Commission will take care of all these unfair methods of competition by its processes.

The situation that he was talking about, the situation that the Senate amendment was directed at was the monopolization of supply by voluntary membership of the farmer members.

Felix Frankfurter:

But he — throughout his report, there’s a distinction, as I think, that’s involved in this case between being a cooperative and what it does.

Philip Elman:

Yes, being a cooperative —

Felix Frankfurter:

That the cooperative addresses itself to being a cooperative and that Section 2 —

Philip Elman:

And, to some extent —

Felix Frankfurter:

And that Section 2 gives power to the Secretary of Agriculture to find that, even being a — a cooperative, names, under certain circumstances, on its findings, begins the public interest.Is that right?

Philip Elman:

If that unduly enhances prices and if does not du — unduly enhance prices, the Secretary — even the Secretary can’t act, so that the — what you’re being asked to hold really is that the grant of power under Section 2 to prevent high prices is, in effect, an immunity against restraints and monopolization which don’t — don’t — may not increase prices and which deprives everybody who was hurt by those violations of any effective remedy other than Section 2.

Thank you very much.

Earl Warren:

Mr. Hughes.

William J. Hughes, Jr.:

If Your Honor please.

As House Council for this unhappy group of farmers, let me suggest that the important reality in the situation, to my mind, is this.

The Government concedes that we have a right to get 100% of these producers into an organization.

They admit that, since 1923, we have had from 85% to 95% of the milk production in this area.

Now, having all this milk, on the income, the question is what are we going to do with in on the outcome?

We’ve got to sell it.

In other words, if we don’t sell it, we’re simply a savings bank for milk or a warehouse.

Now, in selling it, we’ve got to sell it from a monopoly position.

In other words, we are a monopoly all this time and, so, we are selling this milk from a monopoly position.

We are committing acts of monopoly, all along the line, in selling this milk.

We’re bound to restraint trade.

We’re bound to fixed prices.

We’re bound on most occasions, I suppose, or some occasions, to exclude producers.

So, everything we do has two sides to it.

In other words, in the operation of this monopoly, we are doing acts together under Section 1.

We are, likewise making, from out viewpoint, the necessary contracts and agreements to effectuate the sale of our members’ milk.

But, unquestionably, we’re violating the antitrust laws if we’re to be judged by ordinary antitrust standards.

Now, what is the test?

The Test — the only test that we can see is undue enhancement of prices.

Unless that’s the test, the antitrust division can bring a lawsuit or indict us any day in the week.

I don’t know why they pick out the Embassy acquisition.

They could just as well have gone back to 1923 and indicted us and sued us and enjoined us for everything we did over that whole period of time because we were operating a monopoly.

Earl Warren:

Mr. Hughes.

William J. Hughes, Jr.:

Now —

Earl Warren:

Mr. Elman read us from the complaint the allegation that your client prevented transportation of milk into this community.

Do you think that whatever exemption you have gives you the right to prevent transportation coming out — milk coming into the City of Washington?

I’m not — I’m not judging it now.

I’m not saying, well, there is —

William J. Hughes, Jr.:

Well, I thank Your Honor for that —

Earl Warren:

— a fair allegation or not —

William J. Hughes, Jr.:

— frankly question.

Earl Warren:

But the allegation is there.

Now, do you — do you include —

William J. Hughes, Jr.:

Well —

Earl Warren:

— that in your exemption that you may use methods of that kind to coerce people into and to prevent transportation into the city of milk because it happens to compete with your monopoly position?

William J. Hughes, Jr.:

My answer, Your Honor, is that Congress had to put it tr — its trust somewhere.

It’s just like the situation that Judge Learned Hand had before him in New York in Gregoire against Biddle, a suit against Attorney General Biddle for alleged vicious practices against somebody in an immigration proceeding.

Judge Learned Hand said it would be monstrous to deny this man relief if he was right, but we can’t tell if he’s right until the case is tried.

Now, in the same situation here, you never can tell if the antitrust division is going to assail all these acts all along the line, going back, as I say, to 1923, until after the case is tried.

And, that’s precisely what Congress, I think, by the overwhelming legislative history which we’ve cited to you, was anxious to avoid because it knew the antitrust division, having competitive cheap prices as its object, would naturally assail any of our activities, over the period of years, and an operation of a monopoly which was designed not to get prices down but to get prices up.

Felix Frankfurter:

What you —

William J. Hughes, Jr.:

Up but fair.

Felix Frankfurter:

What — are you saying that Congress put its trust for protection against what might be public evil in the administrative determination of the Secretary of Agriculture, is that right?

William J. Hughes, Jr.:

I am saying that.

Felix Frankfurter:

That’s your argument.

William J. Hughes, Jr.:

I am saying that, Your Honor, and that that was the only place it could put it and it could only give the undue enhancement of prices as the test because anything else we did would naturally violate the antitrust laws.

Felix Frankfurter:

Now —

William J. Hughes, Jr.:

Now, if the Department of Justice, the Antitrust Division, could assail our activities any day in the week for any routine act that we committed violative of the Antitrust laws, they could restrain those acts all along the line.

There’d never be any opportunity for the Secretary of Agriculture to reach the question of undue enhancement of prices.

Earl Warren:

Is there —

William J. Hughes, Jr.:

Now —

Earl Warren:

Is there in the — in the Secretary of Agriculture any power to restrain your organization from preventing other farmers or other cooperatives from transporting their milk into Washington?

William J. Hughes, Jr.:

In the event he finds undue enhancement of prices —

Earl Warren:

No.

William J. Hughes, Jr.:

— Your Honor —

Earl Warren:

Let’s leave out the —

William J. Hughes, Jr.:

He can do anything.

Earl Warren:

Let’s leave out the price of proposition.

Whether you’re making a lot of money or whether you’re making little — a little money.

Suppose you’re making a little money and, in order to make up to your 80%, you use oppressive methods of that kind —

William J. Hughes, Jr.:

No, I don’t —

Earl Warren:

— and you use — use methods that will prevent other farmers and other cooperatives from transporting their milk into Washington.

Does the Secretary of Commerce have any — any jurisdiction over that matter?

William J. Hughes, Jr.:

No, I don’t think he does.

Earl Warren:

Who does?

Does anybody?

William J. Hughes, Jr.:

I think, Your Honor, the only test is the undue enhancement of prices.

In other words, if those acts don’t result in the undue enhancement of prices, why, they’re down in my maps way in jury, you put it that way.

In other words, Congress intended to regulate the agricultural economy by allowing cooperatives to raise prices and, in that process, somebody is bound to get injured.

You can’t help it.

Now, to put their trust somewhere and I say they put it in us.

And evidently, it’s been well placed because it’s been a long time since the Capper-Volstead Act was passed.

Now, take the Embassy acquisition.

There you have a perfect example.

There we had a chance to move seven or — 20,000 gallons of milk a day from Class 3 into Class 1, double it, $750,000 a year to us, greatly valuable thing.

It kept prices up and stabilized the market.

Yet, it had a reverse side of the coin, namely, that it displaced these producers out here in Maryland.

Naturally, if we were going to put our producers in, the Maryland producers, the other producers wouldn’t go out.

But, we couldn’t help it.

Charles E. Whittaker:

May I ask you this?

Suppose your answer to the Chief Justice in which you gave Mr. Justice — Mr. Learned — Judge Learned Hand as a quotation from him saying this condition would be monstrous if it were true, but we do not know whether it’s true until there has been a trial, now, my question does that mean that you concede that the, in effect, sustaining of the motion to dismiss count 1 was that the cause of action is stated and —

William J. Hughes, Jr.:

No.

Charles E. Whittaker:

I beg your pardon?

William J. Hughes, Jr.:

No, Your Honor.

I don’t say that.

I say, though, that there’s no way for a cooperative to operate by going down to the Department of Justice everyday in a week, hand in hand, to get clearance for its everyday act, all of which violate the antitrust laws.

Charles E. Whittaker:

I took your answer to the Chief Justice to plead in existence of learning the truth which you referred to it in the complaint.

But that as Judge Learned Hand pointed out in the case you referred to, it would be monstrous if it were sold but it can’t be told what it is until there’s been a trial.

But here, the complaint has been dismissed.

Now, there’d be no opportunity to try it.

Charles E. Whittaker:

You must, here, now confess the facts alleged, that is, that are well pleaded.

Now, is there a cause of action stated?

William J. Hughes, Jr.:

Your Honor, what Judge Learned Hand said was that public policy prevents even an attempt to add at trial, the reason being that you can’t harass public officials by suits good, better, or indifferent.

And that’s my point here.

Earl Warren:

What (Inaudible)

William J. Hughes, Jr.:

We can’t be harassed by governmental suits good, bad, or indifferent, everyday in the week.

Earl Warren:

What public official was being harassed in these situations here?

William J. Hughes, Jr.:

I don’t know how to follow you, Mr. Chief Justice.

Earl Warren:

Well, you said that — you just said that a public official should not be harassed in accordance with Judge Hand’s view.

What public official is being harassed by the position of the Government in this case?

William J. Hughes, Jr.:

Well, there isn’t any public official, Your Honor, but we are public functionary in the sense that we are the method or means by which Congress has chosen to regulate the agricultural economy.

And incidentally, in that respect, when Mr. Elman was asked as to whether the Bank for Cooperatives simply said, “We were good credit risks”, at page 11 of our bli — brief, we’ve pointed out very clearly that the Bank for Cooperatives made the statutory findings.

And, the statutory findings were that the loan was in aid of the agricultural policies of the United States.

In other words, Section — it says that the findings were that the Agricultural Market Act require the loan to be in furtherance of policy declared in 1141, namely, promoting the establishment and financing of a farm marketing system of producer-owned and producer-controlled cooperative associations.

And by aiding in preventing, and I’m not going to read all the words but this is the point, and preventing depressions in prices for the commodity.

So, our point is that, in this case, the Government is applying competitive ideas to a branch of the economy where competitive ideas have no place.

Certainly we restrain trade.

Certainly, we eliminate competition.

As I say, we do it and we do it simply because Congress has said, not only you can do it but that’s the way to do it.

That’s the way you keep prices up.

Hugo L. Black:

Do you think that includes (Inaudible) the charge on page 42 that it threatened and induced a boycott of the man who sold feed and farm supply?

William J. Hughes, Jr.:

Well, Your Honor, all the antitrust laws are (Inaudible) in the American Tobacco case, of course, the Standard Oil case, and other cases, all the antitrust laws have been designed to prevent enhancement of prices and are detrimental to the public.

Now, here —

Hugo L. Black:

Have they also intended in that to prevent the boycotts of people by —

William J. Hughes, Jr.:

But the boycott —

Hugo L. Black:

(Voice Overlap) —

William J. Hughes, Jr.:

— was on route to the enhancement of prices.

Now, here, you have a congressional policy that prices ought to be enhanced and, so to me, it’s completely illogical to apply to that policy, as given in the second section of the Capper-Volstead Act, ideas which are drawn from just the opposite policy, namely, to keep prices down.

Hugo L. Black:

Let’s suppose your members decided they didn’t like (Inaudible) and all of them were — wrote letters out to all their friends not to buy any goods from you.

You would say they had a right to do that?

Hugo L. Black:

That seems to be what this charge is.

I don’t say that it’s fact.

That seems to be what the charge is.

William J. Hughes, Jr.:

They might be common law torts, Your Honor, but I’d say that so far as the congressional policy of getting farmers a fair return for their money and they never will, unless they get together, prices will drop down, down, down of it.

That it isn’t any violation of that policy.

Somebody, as I say, gets hurt on route and ever — bound to be people that are hurt in the thing.

Now, I think, therefore, the task of this Court, as I might — if I might suggest it is, in accordance with its decision in the Hutcheson case, there, you drew together the various congressional policies and you came up with a solution to the labor problem of that day.

Now, we say the same thing applies here.

Here, you have various agricultural statutes, all of which, in the end, point to a regulation of agriculture, by a way, completely divorced, as I think, from the antitrust laws.

Thank you, Your Honor.