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

PETITIONER: Maryland and Virginia Milk Producers Assn., Inc.
RESPONDENT: United States
LOCATION: Approximately half-way between Santa Marta, Colombia and Miami. Florida (by water)

DOCKET NO.: 62
DECIDED BY: Warren Court (1958-1962)
LOWER COURT:

CITATION: 362 US 458 (1960)
ARGUED: Jan 19, 1960 / Jan 20, 1960
DECIDED: May 02, 1960

Facts of the case

Question

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

Audio Transcription for Oral Argument - January 20, 1960 in 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

Earl Warren:

Number 550 or number 62 rather, Maryland and Virginia Milk Producers Association, Appellant, versus, United States, and United States versus Maryland and Virginia Milk Producers Association.

Mr. Bergson, you may proceed.

Herbert A. Bergson:

May it please the Court.

This case is here on direct appeal by both parties from judgments of the United States District Court for the District of Columbia.

This is a case that was brought under the antitrust laws charging violations of Section 2 of the Sherman Act, Section 3 of the Sherman Act, Section 7 of the Clayton Act.

The court below held that agricultural cooperatives, which the defendant established it was, are exempt from prosecution under Section 2 of the Sherman Act, were not acting in combination with outsiders by virtue of the provisions of Section 6 of the Clayton Act and Sections 1 and 2 of the Capper-Volstead Act.

The Government is appealing from this decision, in this judgment.

The Court also held that the cooperative was not exempt when it acquires a retail dairy, where the effect of the acquisition is to restrain trade in violation of Section 3 of the Sherman Act or to substantially lessen competition or tend to create a monopoly in violation of Section 7 of the Clayton Act, from this judgment, the association appeals.

The Government also appeals from this judgment on the issue of adequacy of the relief that was granted by the District Court.

The issue that is central to both appeals is not whether, but to the extent -- but the extent to which agricultural cooperatives are exempt from the normal operations of the antitrust laws by virtue of the provisions of the Clayton and Capper-Volstead Act.

Now, there's no dispute between the parties that there is some exemptions.

William J. Brennan, Jr.:

Of what?

Herbert A. Bergson:

Some exemptions.

The Government in its main brief concedes that agricultural cooperatives were given a limited immunity from Section 2 of the Sherman Act, namely, the right to obtain a monopoly in the colloquial sense and I'm quoting, “Of controlling the entire source of supply in a particular area.”

The Government also concedes that the act from this, an agricultural association to obtain a degree of control over supply, which in the case of ordinary corporations, might constitute unlawful monopolization.

Further, in its reply brief, the Government states that it has not asserted that a cooperative by the mere possession of monopoly market power transcends any Capper-Volstead authorization.

The Government's position, as stated in its question presented, is whether monopolization or attempted monopolization by coercive and exclusionary means are immunized.

It's the association's position, on the other hand, that the cooperative has complete immunization from antitrust prosecution, say it in two circumstances.

One, where it combines with nonexempt -- combines or conspires with nonexempt outsiders for the benefit of the nonexempt outsiders as was the case in Borden, and two, where the monopolization results in undue enhancement of prices.

In that case, a special procedure is set up whereby the Secretary of Agriculture makes findings of fact, considers the question of monopolization and undue enhancement and authorizes and -- and orders the association to desist from such monopolization or restraint of trade.

Felix Frankfurter:

Would you mind turning -- turning to the page where one could put his eyes on the terms of the statute instead of the rephrasing it?

Herbert A. Bergson:

It's in the appendix to our brief, Your Honor, our first brief at pages 3 (a) -- no, excuse me --

4 (a).

Herbert A. Bergson:

4 (a).

Felix Frankfurter:

It comes from Capper-Volstead, isn't it?

Herbert A. Bergson:

Capper-Volstead.

It is now a difference -- it makes no difference (Inaudible) having she used -- I haven't read -- of reading the Government's (Inaudible)

Herbert A. Bergson:

I don't think so.

And then --

Herbert A. Bergson:

And we -- we're both talking about the same --