Editing Sherman Antitrust Act (section)

==Background==
In ''[[Spectrum Sports, Inc. v. McQuillan]]'' 506 U.S. 447 (1993) the Supreme Court said:

{{blockquote|The purpose of the [Sherman] Act is not to protect businesses from the working of the market; it is to protect the public from the failure of the market. The law directs itself not against conduct which is competitive, even severely so, but against conduct which unfairly tends to destroy competition itself.<ref name="SpectrumSports">{{ussc|name=Spectrum Sports, Inc. v. McQuillan|link=|volume=506|page=447|pin=458|year=1993}}.</ref>}}

According to its authors, it was not intended to impact market gains obtained by honest means, by benefiting the consumers more than the competitors. Senator [[George Hoar]] of [[Massachusetts]], another author of the Sherman Act, said the following:

{{blockquote|... [a person] who merely by superior skill and intelligence...got the whole business because nobody could do it as well as he could was not a monopolist...(but was if) it involved something like the use of means which made it impossible for other persons to engage in fair competition."<ref>{{cite web|url=https://books.google.com/books?id=OsssAAAAYAAJ&pg=PA279|title=Bills and Debates in Congress Relating to Trusts: Fiftieth Congress to Fifty-seventh Congress, First Session, Inclusive|first1=United States|last1=Congress|first2=James Arthur|last2=Finch|date=26 March 2018|publisher=U.S. Government Printing Office|via=Google Books|url-status=live|archive-url=https://web.archive.org/web/20170409142100/https://books.google.com/books?id=OsssAAAAYAAJ&pg=PA279&lpg=PA279&source=bl&ots=QI5PFBZPn_&sig=0mccC_vXBFDUc9O8BsmPW2x6HAk&hl=en&ei=VoXFTs28OoObtwej1PWTCg&sa=X&oi=book_result&ct=result&resnum=3&ved=0CCgQ6AEwAg#v=onepage&f=false|archive-date=9 April 2017}}</ref>}}

Apex Hosiery suffered losses when strikers occupied their business, and prevented shipments of orders, including shipments to other states.  Apex attempted to sue the union leader for treble damages as provided by the Sherman Act.  Apex argued that the union had interfered with interstate commerce. The court held that the Sherman Act did not apply to the unlawful occupation of a business.

At ''Apex Hosiery Co. v. Leader'' [http://supreme.justia.com/us/310/469/case.html 310 U.S. 469], [http://supreme.justia.com/us/310/469/case.html#492 310 U. S. 492]-93 and n. 15:

{{blockquote|The legislative history of the Sherman Act, as well as the decisions of this Court interpreting it, show that it was not aimed at policing interstate transportation or movement of goods and property. The legislative history and the voluminous literature which was generated in the course of the enactment and during fifty years of litigation of the Sherman Act give no hint that such was its purpose.<ref>Footnote 11 appears here: "''See'' the Bibliography on Trusts (1913) prepared by the Library of Congress. ''Cf.'' Homan, Industrial Combination as Surveyed in Recent Literature, 44 Quart.J.Econ., 345 (1930). With few exceptions, the articles, scientific and popular, reflected the popular idea that the Act was aimed at the prevention of monopolistic practices and restraints upon trade injurious to purchasers and consumers of goods and services by preservation of business competition. ''See, e.g.,'' Seager and Gulick, Trust and Corporation Problems (1929), 367 ''et seq.,'' 42 Ann.Am.Acad., Industrial Competition and Combination (July 1912); P. L. Anderson, Combination v. Competition, 4 Edit.Rev. 500 (1911); Gilbert Holland Montague, Trust Regulation Today, 105 Atl.Monthly, 1 (1910); Federal Regulation of Industry, 32 Ann.Am.Acad. of Pol.Sci., No. 108 (1908), ''passim;'' Clark, Federal Trust Policy (1931), Ch. II, V; Homan, Trusts, 15 Ency.Soc.Sciences 111, 113:

"clearly the law was inspired by the predatory competitive tactics of the great trusts, and its primary purpose was the maintenance of the competitive system in industry."

''See also'' Shulman, Labor and the Anti-Trust Laws, 34 Ill.L.Rev. 769; Boudin, the Sherman Law and Labor Disputes, 39 Col.L.Rev. 1283; 40 Col.L.Rev. 14."</ref>}}

{{blockquote|They do not suggest that, in general, state laws or law enforcement machinery were inadequate to prevent local obstructions or interferences with interstate transportation, or presented any problem requiring the interposition of federal authority.<ref>Footnote 12 appears here: "There was no lack of existing law to protect against evils ascribed to organized labor. Legislative and judicial action of both a criminal and civil nature already restrained concerted action by labor. ''See, e.g.,'' the kinds of strikes which were declared illegal in Pennsylvania, including a strike accompanied by force or threat of harm to persons or property, Brightly's Purdon's Digest of 1885, pp. 426, 1172.

For collection of state statutes on labor activities, ''see'' Report of the Commissioner of Labor, Labor Laws of the Various States (1892); Bull. 370, Labor Laws of the United States with Decisions Relating Thereto, United States Bureau of Labor Statistics (1925); Witte, The Government in Labor Disputes (1932), 12–45, 61–81."</ref> 

In 1890, when the Sherman Act was adopted, there were only a few federal statutes imposing penalties for obstructing or misusing interstate transportation.<ref>Footnote 13 appears here: "Three statutes covered in 1890 the Congressional action in relation to obstructions to interstate commerce. A penalty was imposed for the refusal to transmit a telegraph message (R.S. § 5269, 17 Stat. 366 (1872)) for transporting nitroglycerine and other explosives without proper safeguards (R.S. § 5353, 14 Stat. 81 (1866)) and for combining to prevent the continuous carriage of freight, 24 Stat. 382, 49 U.S.C. § 7."</ref> With an expanding commerce, many others have since been enacted safeguarding transportation in interstate commerce as the need was seen, including statutes declaring conspiracies to interfere or actual interference with interstate commerce by violence or threats of violence to be felonies.<ref>Footnote 14 appears here:

"''See, e.g.'' regulation of; interstate carriage of lottery tickets, 28 Stat. 963 (1895), 18 U.S.C. § 387; Transportation of obscene books, 29 Stat. 512 (1897), 18 U.S.C. § 396; transportation of illegally killed game, 31 Stat. 188 (1900), 18 U.S.C. §§ 392–395; interstate shipment of intoxicating liquors, 35 Stat. 1136 (1909), 18 U.S.C. §§ 388–390; white slave traffic, 36 Stat. 825 (1910), 18 U.S.C. §§ 397–404; transportation of prize-fight films, 37 Stat. 240 (1912), 18 U.S.C. §§ 405–407; larceny of goods moving in interstate commerce, 37 Stat. 670 (1913), 18 U.S.C. § 409; violent interference with foreign commerce, 40 Stat. 221 (1917), 18 U.S.C. § 381; transportation of stolen motor vehicles, 41 Stat. 324 (1919), 18 U.S.C. § 408; transportation of kidnapped persons, 47 Stat. 326 (1932), 18 U.S.C. § 408a–408c; threatening communication in interstate commerce, 48 Stat. 781 (1934), 18 U.S.C. § 408d; transportation of stolen or feloniously taken goods, securities or money, 48 Stat. 794 (1934), 18 U.S.C. § 415; transporting strikebreakers, 49 Stat. 1899 (1936), 18 U.S.C. § 407a; destruction or dumping of farm products received in interstate commerce, 44 Stat. 1355 (1927), 7 U.S.C. § 491. ''Cf.''

National Labor Relations Act, 49 Stat. 449 (1935), 29 U.S.C., Ch. 7, § 151,

"Findings and declaration of policy. The denial by employers of the right of employees to organize and the refusal by employers to accept the procedure of collective bargaining lead to strikes and other forms of industrial strife or unrest, which have the intent or the necessary effect of burdening or obstructing commerce. . . ."

The Anti-Racketeering Act, 48 Stat. 979, 18 U.S.C. §§ 420a-420e (1934), is designed to protect trade and commerce against interference by violence and threats. § 420a provides that

"any person who, in connection with or in relation to any act in any way or in any degree affecting trade or commerce or any article or commodity moving or about to move in trade or commerce --"

"(a) Obtains or attempts to obtain, by the use of or attempt to use or threat to use force, violence, or coercion, the payment of money or other valuable considerations . . . not including, however, the payment of wages by a bonafide employer to a bona fide employee; or"

"(b) Obtains the property of another, with his consent, induced by wrongful use of force or fear, or under color of official right; or"

"(c) Commits or threatens to commit an act of physical violence or physical injury to a person or property in furtherance of a plan or purpose to violate subsections (a) or (b); or"

"(d) Conspires or acts concertedly with any other person or persons to commit any of the foregoing acts; shall, upon conviction thereof, be guilty of a felony and shall be punished by imprisonment from one to ten years or by a fine of $10,000 or both."

But the application of the provisions of § 420a to labor unions is restricted by § 420d, which provides:

"Jurisdiction of offenses. Any person charged with violating section 420a of this title may be prosecuted in any district in which any part of the offense has been committed by him or by his actual associates participating with him in the offense or by his fellow conspirators: ''Provided,'' That no court of the United States shall construe or apply any of the provisions of sections 420a to 420e of this title in such manner as to impair, diminish, or in any manner affect the rights of bona fide labor organizations in lawfully carrying out the legitimate objects thereof, as such rights are expressed in existing statutes of the United States."

It is significant that Chapter 9 of the Criminal Code, dealing with "Offenses Against Foreign And Interstate Commerce" and relating specifically to acts of interstate transportation or its obstruction, makes no mention of the Sherman Act, which is made a part of the Code which deals with social, economic and commercial results of interstate activity, notwithstanding its criminal penalty."</ref>}} 

{{blockquote|The law was enacted in the era of "trusts" and of "combinations" of businesses and of capital organized and directed to control of the market by suppression of competition in the marketing of goods and services, the monopolistic tendency of which had become a matter of public concern. The goal was to prevent restraints of free competition in business and commercial transactions which tended to restrict production, raise prices, or otherwise control the market to the detriment of purchasers or consumers of goods and services, all of which had come to be regarded as a special form of public injury.<ref>Footnote 15 appears here:

"The history of the Sherman Act, as contained in the legislative proceedings, is emphatic in its support for the conclusion that "business competition" was the problem considered, and that the act was designed to prevent restraints of trade which had a significant effect on such competition.

On July 10, 1888, the Senate adopted without discussion a resolution offered by Senator Sherman which directed the Committee on Finance to inquire into, and report in connection with, revenue bills

"such measures as it may deem expedient to set aside, control, restrain or prohibit all arrangements, contracts, agreements, trusts, or combinations between persons or corporations, made with a view, or which tend to prevent ''free and full competition'' . . . with such penalties and provisions . . . as will tend to preserve freedom of trade and production, the natural competition of increasing production, the lowering of prices by such competition . . ."

(19 Cong.Rec. 6041).

This resolution explicitly presented the economic theory of the proponents of such legislation. The various bills introduced between 1888 and 1890 follow the theory of this resolution. Many bills sought to make void all arrangements

"made with a view, or which tend, to prevent full and free competition in the production, manufacture, or sale of articles of domestic growth or production, . . ."

S. 3445; S. 3510; H.R. 11339; all of the 50th Cong., 1st Sess. (1888) were bills of this type. In the 51st Cong. (1889), the bills were in a similar vein. ''See'' S. 1, sec. 1 (this bill as redrafted by the Judiciary Committee ultimately became the Sherman Law); H.R. 202, sec. 3; H.R. 270; H.R. 286; H.R. 402; H.R. 509; H.R. 826; H.R. 3819. ''See'' Bills and Debates in Congress relating to Trusts (1909), Vol. 1, pp. 1025–1031.

Only one, which was never enacted, S. 1268 in the 52d Cong., 1st Sess. (1892), introduced by Senator Peffer, sought to prohibit

"every willful act . . . which shall have the effect to in any way interfere with the freedom of transit of articles in interstate commerce, . . ."

When the antitrust bill (S. 1, 51st Cong., 1st Sess.) came before Congress for debate, the debates point to a similar purpose. Senator Sherman asserted the bill prevented only "business combinations" "made with a view to prevent competition", 21 Cong.Rec. 2457, 2562; ''see also ibid.'' at 2459, 2461.

Senator Allison spoke of combinations which "control prices," ''ibid.,'' 2471; Senator Pugh of combinations "to limit production" for "the purpose of destroying competition", ''ibid.,'' 2558; Senator Morgan of combinations "that affect the price of commodities," ''ibid.,'' 2609; Senator Platt, a critic of the bill, said this bill proceeds on the assumption that "competition is beneficent to the country," ''ibid.,'' 2729; Senator George denounced trusts which crush out competition, "and that is the great evil at which all this legislation ought to be directed," ''ibid.,'' 3147.

In the House, Representative Culberson, who was in charge of the bill, interpreted the bill to prohibit various arrangements which tend to drive out competition, ''ibid.,'' 4089; Representative Wilson spoke in favor of the bill against combinations among

"competing producers to control the supply of their product, in order that they may dictate the terms on which they shall sell in the market, and may secure release from the stress of competition among themselves,"

''ibid.,'' 4090.

The unanimity with which foes and supporters of the bill spoke of its aims as the protection of free competition permits use of the debates in interpreting the purpose of the act. ''See'' White, C.J. in ''Standard Oil Co. v. United States,'' [http://supreme.justia.com/us/221/1/case.html#50 221 U. S. 50] {{webarchive|url=https://web.archive.org/web/20090501033745/http://supreme.justia.com/us/221/1/case.html#50 |date=2009-05-01 }}; ''United States v. San Francisco, ante,'' p. [http://supreme.justia.com/us/310/16/case.html 310 U. S. 16] {{webarchive|url=https://web.archive.org/web/20090525001628/http://supreme.justia.com/us/310/16/case.html |date=2009-05-25 }}.

''See also'' Report of Committee on Interstate Commerce on Control of Corporations Engaged in Interstate Commerce, S.Rept. 1326, 62d Cong., 3d Sess. (1913), pp. 2, 4; Report of Federal Trade Commission, S.Doc. 226, 70th Cong., 2d Sess. (1929), pp. 343–345."</ref>}} 

{{blockquote|For that reason the phrase "restraint of trade," which, as will presently appear, had a well understood meaning in common law, was made the means of defining the activities prohibited. The addition of the words "or commerce among the several States" was not an additional kind of restraint to be prohibited by the Sherman Act, but was the means used to relate the prohibited restraint of trade to interstate commerce for constitutional purposes, Atlantic Cleaners & Dyers v. United States, 286 U. S. 427, 286 U. S. 434, so that Congress, through its commerce power, might suppress and penalize restraints on the competitive system which involved or affected interstate commerce. Because many forms of restraint upon commercial competition extended across state lines so as to make regulation by state action difficult or impossible, Congress enacted the Sherman Act, 21 Cong.Rec. 2456. It was in this sense of preventing restraints on commercial competition that Congress exercised "all the power it possessed." Atlantic Cleaners & Dyers v. United States, supra, 286 U. S. 435.}}

At ''[[Addyston Pipe and Steel Company v. United States]]'', 85 F.2d 1, ''affirmed'', [http://supreme.justia.com/us/175/211/case.html 175 U. S. 175] U.S. 211;

At ''[[Standard Oil Co. of New Jersey v. United States]]'', [http://supreme.justia.com/us/221/1/case.html 221 U. S. 1], [http://supreme.justia.com/us/221/1/case.html#54 221 U. S. 54]-58.