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arrangement would show a monopoly purpose. Hence, the fine would become an instrument to secure a loyalty to the organization which would become the effective means of achieving the monopoly purpose. Hence it would quite properly be held illegal.

Martell v. White is to be sustained, if at all, on the ground that such an attempt at monopoly existed. That depends upon whether this association did or did not occupy a preponderant position. It clearly did at the Quincy quarries. Were these so isolated and was the cost of transporting granite such that Quincy must be regarded as a market by itself, cut off from the rest of the world so far as quarrying, manufacturing and polishing granite are concerned. Perhaps so-perhaps not. We do not know the facts. This vital aspect of the case was not developed. Yet the court may have been profoundly influenced by it. It may have looked upon this association as being preponderant in Quincy and that Quincy was a market by itself.

§ 103. In Macauley v. Tierney 14 we have two groups of plumbers competing. One was organized, the other was not. The organization in the course of competition refused to deal with any manufacturer who dealt with a non-member. This was held to be lawful. It was not a tort to the non-member on the part of the plumbers' association.

Laying aside all question of the size and preponderant position of the plumbers' association, we have here Allen v. Flood 15 over again—that is to say Allen v. Flood in its simplest form. It is the strike by one plumbers' association against manufacturers if they deal with the other and rival group. If the plumbers' association had had an agreement with the manufacturer that they would not deal with outsiders it would have been valid under the Mogul case.16

If, however, we introduce the fact that the plumbers' association had a preponderant position in the plumbing business throughout the United States the whole situation is changed. The plumbers' association would then have a power over the manufacturer, and it would be using that power to exclude others

14—19 R. I. 255 (1895) [487]. 15-Ante

96.

Kales Sum. R. of T.-7

97

16-Ante § 94.

from the plumbing business. That is a clear attempt to secure a monopoly. It is the same as if the Standard Oil Company refused to sell to anyone who dealt with an independent. It is the same as if the International Harvester Company refused to sell to any farmers who dealt with an independent. Such acts would be unfair methods of competition and illegal and constitute a tort on the part of the combination against the independent manufacturers' damaged.

Did the plumbers' association in Macauley v. Tierney have a preponderant position? It was a national organization. One may suspect that it did have a preponderant position. The court, however, entirely neglected this aspect of the case. It failed to consider the effect which the preponderant position of the plumbers' association would have had if it had existed. Perhaps it is fair to say that in 1895 it was not apparent to the court that preponderant position was to have the consequences which it is now perceived it must have.

§ 104. In Brown & Allen v. Jacobs' Pharmacy Co.17 the members of the retailers' association refused to deal with wholesalers who sold to other retailers, who cut prices fixed by the retailers' association. This was held to be tort and the act of the retailers' association was enjoined at the suit of the outsider.

Here we have the strike against the wholesaler used to require the wholesaler to bring pressure upon the outsider to observe the association's rules as to prices. We have also the retailers' association clearly occuping a preponderant position in the business. It was a national organization. The court vaguely hints at this feature of the case. The fact that the association of retailers deals directly with the maintenance of prices is an assumption of preponderant position and power to exclude others, 18 so that the association of retailers presents all the features of an illegal attempt at monopoly. The act complained of in aid of that monopoly is clearly a tort.

§ 105. In National Fireproofing Company v. Mason Builders' Association 19 we have a case where the competition was between

17-115 Ga. 429 (1902) [496]. 18-Ante § 70.

19-169 Fed. 259 (1909) [522].

the group of bricklayers who wanted inside as well as outside work and the group of bricklayers who did only inside work, such as tiling and fireproofing, the contracts for which were sublet to special contractors. It may be assumed that the only labor employed was union labor, and that all the bricklayers belonged to the same union. The point was, however, that the special contractors for the inside work hired bricklayers who became inside specialists. To prevent such a development the bricklayers refused to work unless the entire contract for all bricklaying was given to the general contractor, who could then give inside work to outside men. The operation of this was to prevent the fireproofing company from doing business as they wanted to, with specialist bricklayers to lay their particular kind of fireproofing. The action of the bricklayers, causing damage to the fireproofing company, was held not to be a tort and an injunction against the bricklayers was refused.

Considered apart from any question of size or preponderant position on the part of the bricklayers' association, the decision is correct. It is distinctly the case of Allen v. Flood 20 over again. For the moment the two branches of the same union come into competition. The many want to work in one way and the minority were willing to specialize. The majority threatened to strike unless the builder let his contract in such a way as to stop the specialization. That was legitimate competition between the groups of workmen just as it was in Allen v. Flood. The fact that the fireproofing concern was also interfered with because of its relation to the contract made no difference. No doubt third parties are frequently affected when one group in competition wins out against another.

If, however, the bricklayers had a preponderant position which they were using to exclude others from a certain kind of work then the threats of strike must have been a tort to the specialist group of bricklayers. But suppose they waived the point or released it, or refused to enforce their right. Suppose their sympathies were with the majority and they were willing that the views of the majority should prevail. Could the fireproofing concern sue? That depends upon whether there was any inde

20-Ante & 96.

pendent tort committed to it. The fireproofing concern was only damaged as an incident to the competition between the majority of the bricklayers and the specialist bricklayers. If the specialists did not object, how can it be said that any tort was committed to the fireproofing concern? If a competitor submits to a rival, others who are damaged by reason of his submission, have not suffered a tort. The court clearly took this view. It refused to let the fireproofing concern take any advantage of the fact that by reason of size and preponderant position of the bricklayers' association, a tort had been committed to a group of specialist workmen. This appears rather vaguely in the court's assertion that the mere fact that the bricklayers were an illegal organization does not give the plaintiff a right to sue at common law or under the Sherman Act. Having taken this step, the court, apparently, eliminated any fact of preponderant position of the bricklayers from the case for all purposes. After that it was easy to find that no tort had been committed to the specialist bricklayers or to the complainant-the fireproofing

concern.

§ 106. Park & Sons Co. v. National Druggists Association 21 and Klingel's Pharmacy v. Sharp & Dohme 22 should be considered together.

Both cases alike arise on demurrer and in both alike the manufacturer or an association of manufacturers or wholesalers of drugs refused to sell to retailers who did not keep up the prices of articles on resale. In both the plaintiff to whom this refusal had been made was suing the manufacturer in tort or to enjoin his action. In the Park & Sons Case the demurrer was sustained. No tort had been committed. In the Klingel Case the demurrer was overruled. A tort had been committed.

In Klingel's Pharmacy Case, the defendants were two wholesale drug houses which acted in connection with a third defendant which was a retail druggists' association. These three had formed a combination by agreement by which the wholesale houses would not sell to any retail druggist who cut prices contrary to the rules of the Retail Druggists' Association. This was using the boycott or the blacklist to force the plaintiff into 22-104 Md. 218 (1906) [590].

21-175 N. Y. 1 (1903) [553].

a combination of retail druggists which eliminated competition as to prices generally in the retail business. If the position of this combination in the market had been a preponderant one, or was assumed to be so from the effectiveness of its acts against the plaintiff, the boycott would be a tort and might properly be called an unfair method of competition.

In the Park & Sons Case, we have, however, an entirely different situation. The defendant in that case was the National Wholesale Druggists' Association. It had induced the manufacturers of patent or proprietary medicines to refuse to sell to the complainant because the latter refused to comply with the plan of the association that the prices of such articles as fixed by the manufacturers should be kept up to a certain standard on resale. This was not a combination among the retailers or wholesalers to keep up prices generally. It was merely a plan to secure each manufacturer the means whereby he could prevent the cutting of the price fixed by him upon the resale of his manufactured article by the retailer. It is just as if all the manufacturers of patent medicines had agreed not to furnish such articles to anyone who did not keep up the price on resale as requested. Such an arrangement would not constitute a combination of the manufacturers to fix prices generally. Each manufacturer would still compete with the others in the production of medicines and in prices to be charged. The agreement of the manufacturers would merely operate to protect a certain method of marketing through the retailer. That method, as already indicated,23 consists in the manufacturer doing a part of the selling-namely, advertising, standardizing and packing the goods. The retailer is a mere distributor who collects the price. To permit the retailers to compete with each other in the sale price of each manufacturer's product destroys or disrupts this method of marketing. When the interests are all balanced it is found that the immediate advantage to a few from permitting the retailers to compete as to the price of the manufactured article is offset by putting the ban of illegality upon a method of marketing which manufacturers have found effective in building up a business which at all times remains entirely competitive

23-Ante §§ 36-38.

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