ods of competition. Loewe v. Lawlor, supra; Eastern States Lumber Co. v. United States, supra; Nash v. United States, 229 U. S. 373, 379. The objection that the public is not interested in the activities of the association is answered by the fact that if the Commission's findings are to be accepted trade conditions in the harness and saddlery trade have been substantially affected by the methods of competition in question. This subject will more fully appear by consideration of the nature and effect of the Commission's findings.

3. The harness and saddlery trade consists broadly of three divisions: (a) Manufacturers of saddlery hardware, harness goods, and horse furnishing goods; (b) wholesalers and jobbers who buy the last-mentioned classes of goods from the manufacturers and themselves manufacture harness in wholesale quantities, selling both classes of products to the retailer; (c) retail harness dealers who sell saddlery goods at retail and to a small extent manufacture harness.

The Commission's findings of fact, so far as now important, may be thus summarized: Prior to the organization of the Saddlery Association it was the general custom for accessory manufacturers to sell direct to retailers; and in large and important sections of the United States the wholesale and retail saddlery business has long been conducted as one operation. The Harness Manufacturers' Association is a voluntary, unincorporated association, its membership being composed largely of city and district associations in various cities throughout the States of the Union, the membership of these associations being composed of concerns engaged in manufacturing and selling harness and saddlery goods at retail, and who purchase their supplies of harness and saddlery goods largely from whole al rs and jobbers in interstate commerce, including members of the Saddlery Association. The membership of the Saddlery Association, which comprised the greater part of the wholesale saddlery trade of the United States, consisted of persons and concerns engaged in selling at wholesale harness and saddlery goods in interstate commerce throughout the various States and Territories of the United States to retail dealers, both members and nonmembers of the Harness Manufacturers' Association, and in direct competition with other persons or organizations similarly engaged, its declared policy being (at variance with the condition above set forth) to promote a system of trade by which the manufacturers should sell to jobbers only, the jobbers to the retailers only, and the retailers alone direct to consumers; that the Saddlery Association accordingly adopted and established a rule that concerns doing a combined and closely affiliated wholesale and retail business were not eligible to new admission into the Saddlery Association (although some of its old members were still, in various parts of the United States, doing a combined wholesale and retail business), as well as a policy

that such concerns were not entitled to recognition as legitimate jobbers, and that the adoption of such rule and policy were brought about in part by the influence and pressure, and in response to the overtures of the Harness Manufacturers' Association. The Commission further found that the officers, committees, and members of the Harness Manufacturers' Association and of the Saddlery Association have actively cooperated to establish the principle that a combined and closely affiliated wholesale and retail business was not a legitimate wholesale business; that the secretary of the Saddlery Association has attempted to prevent accessory manufacturers from recognizing, as legitimate jobbers, wholesalers whose names were furnished by the Harness Manufacturers' Association to the Saddlery Association, as complained of by retailers, for competing with them; and that the Harness Manufacturers' Association has used its influence with the Saddlery Association to prevent the admission of specific concerns to membership in the latter association and the recognition of such concerns as legitimate jobbers.

The Commission further found that the Harness Manufacturers' Association has requested and secured the cooperation of members of the Saddlery Association in a refusal to sell mail-order houses, hardware stores, general stores, and other competitors of retail harness manufacturers not recognized by the Harness Manufacturers' Association as legitimate; that the latter has refused the privilege of associate membership to accessory manufacturers and jobbers who sell to mail-order houses, establishing, however, an associate membership restricted to manufacturers and jobbers who do not sell to consumers and to mail-order houses, and who are otherwise in harmony with the policy of the association, and issuing credentials thereof to the traveling salesmen of associate members and urging and encouraging the affiliated retailers to withdraw and withhold patronage from concerns whose salesmen were not so equipped; and have induced the members of the Saddlery Association to use their influence with the accessory manufacturers not to sell mail-order houses; and that by reason of refusals of accessory manufacturers, due to objections of the Saddlery Association, to recognize as jobbers certain competitors of members of that association, such competitors have been forced to buy from the Saddlery Association at prices higher than charged by manufacturers to recognized jobbers. The Commission further found that as a result of the opposition of the Harness Manufacturers' Association to sales by manufacturers and jobbers to the classes of competitors before mentioned, the latter had been prevented from purchasing as freely in interstate

It is to be noted that one of the objects of the Harness Manufacturers' Association asstated in its constitution and by-laws, is to protect the harness dealers from the unjust sale of goods by wholesale dealers direct to the consumers.'

74636-22-37

"

commerce as they would have been without such opposition. The findings detail many instances of specific means used to accomplish the various classes of alleged unfair methods of competition, and which we deem it unneccessary to set out.

Both the Saddlery and Harness Manufacturers' Association, its officers, committees, and members of its subsidiary and affiliated associations, were ordered to cease and desist from conspiring or combining between themselves to induce, coerce, and compel accessory manufac turers to refuse to recognize as legitimate jobbers, entitled to buy from manufacturers at jobbers' prices and terms, individuals and concerns doing or endeavoring to do a combined and closely affiliated wholesale and retail business; and from carrying on between themselves communications having the purpose, tendency, and effect of so inducing, coercing, and compelling accessory manufac turers in the respect above referred to.

The Harness Manufacturers Association, its officers, committees, and members of its subsidiary and affiliated associations were ordered to cease and desist from (a) conspiring or combining among themselves to induce, coerce, and compel manufacturers and jobbers to refuse to sell any of the competitors of retail harness manufacturers; (b) using any scheme whereby the active membership of the Harness Manufacturers Association concerted to favor with or confine their patronage to manufacturers and jobbers comprising the associate membership of that association or who had not complied with its active membership by selling to certain competitors thereof; (c) using or continuing any system of credentials or other indication of manufacturers and jobbers sales policies with regard to certain competitors and consumers, and from encouraging and urging retailers to confine their patronage to or to patronize manufac turers and jobbers whose sales policy is in harmony with the Harness Manufacturers Association's requirements as before set out; (d) inducing members of the Saddlery Association to use their influence with accessory manufacturers not to sell to mail order houses or other competitors of retail harness manufacturers.

In our opinion, the Commission's finding of fact, and the existence of the combinations, schemes, and practices directed to be discontinued, are amply sustained either by undisputed testimony or by the great preponderance of the evidence. This conclusion is not overcome by petitioner's criticisms addressed to specific features of the testimony. The findings of fact being so supported, the Commission's order is, in our opinion, fully justified by the authorities to which attention has already been called, including especially Eastern States Lumber Co. v. United States, supra, where a state of facts quite similar to that found here was held to amount to a violation of the Sherman Antitrust Act.

In view of what has appeared, the criticism of lack of public injury is without force. The suggestion that nd damage has been shown, even if true in fact, is answereo by the consideration that the remedy afforded by the statute is preventive, not compensatory.

The order of the Commission, so far as it relates to the Harness Manufacturers Association, its officers, committees, and the members of its subsidiary and affiliated associations, is affirmed.

CURTIS PUBLISHING CO. v. FEDERAL TRADE COMMISSION."

(Circuit Court of Appeals, Third Circuit. March 2,

1921.) No. 2511.

1. CONTRACTS KEY NO. 169-MUST BE CONSTRUED WITH REFERENCE TO ENVIRONMENT AND CIRCUMSTANCES.

There can be no just construction of a contract without an understanding of the general situation and the causes which led to the making of the contract.

2 MONOPOLIFS KEY No. 17 (2)-PROHIBITIONS OF CLAYTON ACT LIMITED TO SALES AND LEASES.

The provision of Clayton Act, section 3 (Comp. St., sec. ES35c), making it unlawful to lease or make a sale or contract for sale of goods on condition that the lessee or purchaser shall not deal in the goods of a competitor of the lessor or seller, is limited to contracts of lease or sale by the clear meaning of its terms, and especialy in view of its purpose to nrake invalid certain contracts of lease or sale of patented articles which the Supreme Court had shortly before held to be valid.

3. MONOPOLIES KEY No. 17(2)-CONTRACT APPOINTING DISTRICT AGENTS FOR DISTRIBUTION OF MAGAZINES HELD NOT A

"SALE" CONTRACT.

A contract by a magazine publisher whereby it appointed another as its agent in a limited district for the purpose of selling and distributing its magazines to retail dealers and to boys who sold at retail, the district agents not being required to purchase the magazines but merely to receive and distributethem and to pay the stipulated price for those which they did not return as unsold, is not a contract for sale of goods, so that the insertion of a clause therein forbidding such district agents to sell at wholesale the magazines of any other publisher without the consent of the principal did not violate the Clayton Act.

[ED. NOTE. For other definitions see Words and Phrases, First and Second Series, Sale.]

• Reviewing order of Commission in Federal Trade Commission v. Curtis Publishing Co., II F. T. 20. Petition of the Commission for writ of certiorari in this case was granted by the Supreme Court on June 6, 1921.

4. MONOPOLIES KEY NO. 17 (2)-REQUIREMENT OF INDEMNITY CASH DEPOSIT HELD NOT TO MAKE AGENCY CONTRACT A SALE.

The provision of a contract appointing district agents for the wholesale distribution of magazines that the agents shall deposit with the publisher a cash sum as security for payment for the magazines distributed to themr, which sum the publisher must account for to the district agent, and on which it must pay him interest, does not make the agency contract a contract for the sale of the magazines within the provisions of the Clayton Act, since the deposit is merely a cash indemnity to secure the performance of the agent's agreement and not a paynrent for the magazines shipped to him.

5. TRADE-MARKS AND TRADE-NAMES KEY No. 804, NEW, VOL. 8A KEY-NO. SERIES-UNFAIR COMPETITION WITHIN TRADE COMMISSION ACT A JUDICIAL QUESTION.

Under the Trade Commission act (Comp. St., secs. 8836a8836k), making unfair competition in interstate commerce unlawful, without defining unfair competition, the determination of whether the acts established amounted to unfair competition is a judicial question, as it long had been in remedial suits at law for damages and injunction suits to prevent unfair competition.

6. TRADE-MARKS AND TRADE-NAMES KEY No. 801, NEW, VOL. 8A KEY-NO. SERIES-COURT'S SUPERVISORY POWERS UNDER TRADE COMMISSION ACT INCLUDED DETERMINATION OF UNFAIR COMPETITION.

Under the Trade Commission act (Comp. St., secs. 8836a8836k), giving to the Circuit Courts of Appeals supervisory powers over the decisions of the Trade Commission, but making the Commission's findings of facts conclusive, the courts, in exercising their supervisory powers, can determine whether the facts established show unfair competition; the decision of that question by the Commission not being final.

7. TRADE-MARKS AND TRADE-NAMES, KEY No. 804, NEW, VOL. SA KEYNo. SERIES-DECISION ON UNFAIR TRADE IN PRIVATE SUIT IS PERSUASIVE IN PROCEEDINGS UNDER TRADE COMMISSION ACT. Where, pending proceedings before the Trade Commission to determine unfair competition, a private suit was instituted by competitors against the company whose methods were under investigation, to restrain those methods as unfair competition, the decision in that suit for the defendant company, though it was not conclusive in the proceedings before the Trade Commission or on review thereof, is to be considered by the supervisory court, with a view to avoiding conflicting holdings under substantially similar states of fact.