Shotkin v. General Electric Co.

• Decision Date: 31 December 1948
• Docket Number: No. 3604.,3604.
• Parties: SHOTKIN v. GENERAL ELECTRIC CO. et al.
• Court: U.S. Court of Appeals — Tenth Circuit

171 F.2d 236 (1948)

SHOTKIN v. GENERAL ELECTRIC CO. et al.

No. 3604.

United States Court of Appeals Tenth Circuit.

December 2, 1948.

Rehearing Denied December 31, 1948.

Bernard M. Shotkin pro se.

Donald S. Stubbs, of Denver, Colo. (Irving Hale, Jr. and Lewis, Grant, Newton, Davis & Henry, all of Denver, Colo., on the brief), for appellees, L. A. Goalby and Westinghouse Electric Corporation.

Henry W. Toll, of Denver, Colo. (Grant, Shafroth & Toll, of Denver, Colo., on the brief), for appellees, General Electric Co., Edison General Electric Appliance Co., now Hotpoint, Inc., and Hendrie & Bolthoff Co.

Winston S. Howard and Pershing, Bosworth, Dick & Dawson, all of Denver, Colo., for appellees, Mine & Smelter Supply Co., O. H. Johnson, and John D. Nicholson.

Merrill A. Knight and Schaetzel & Knight, all of Denver Colo., for appellee New England Electric Co.

Before PHILLIPS, Chief Judge, and BRATTON and MURRAH, Circuit Judges.

BRATTON, Circuit Judge.

This was an action instituted in the United States Court for Colorado by Bernard M. Shotkin, as trustee for his minor children against General Electric Company, General Electric Supply Company, Westinghouse Electric & Manufacturing Company, Westinghouse Electric Supply Company, Thomas A. Edison, Inc., Edison General Electric Appliance Company, and approximately seventy-five other corporations and individuals. Drawn without the aid of counsel, the amended complaint alleged that the action was filed under sections 1, 2, 3, 4, 7, and 15 8 of the Sherman Anti-Trust Act, 15 U.S.C.A. §§ 1-4, 7, 15 note, sections 14 and 16 of the Clayton Act, 15 U.S.C.A. §§ 24, 26, and the Robinson-Patman Act, 15 U.S.C.A. §§ 13, 13a, 13b, 21a. It further charged in general language that fluorescent and incandescent lamps, fixtures, apparatuses, appliances, devices, parts and materials were manufactured by various of the defendants in different localities and were shipped and distributed through the channels of interstate commerce; that the defendants controlled and monopolized the manufacture, sale, and distribution of such commodities; that trading under the names Edison Light & Power Company, Dison Power & Light Company, and Chicago Wholesale Merchandise Company, plaintiff was engaged at Denver, Colorado, in the sale as wholesale distributor of electric lamps, light fixtures, apparatuses, appliances, devices, and other electric goods; and that most of his business was in interstate commerce. The complaint further alleged that the defendant Westinghouse Electric & Manufacturing Company agreed to furnish plaintiff lamps at the highest distributor's discount for sale and distribution in the course of his business in Denver; that such defendant did furnish plaintiff lamps for a period of time; that the defendants entered into a combination or conspiracy to drive plaintiff out of business, with the intent to monopolize or attempt to monopolize a part of the interstate trade in fluorescent and incandescent lamps and fixtures originating in Denver; that as part of such combination or conspiracy or as the result thereof, the defendant Westinghouse Electric & Manufacturing Company ceased to furnish lamps to plaintiff and thereafter refused to furnish them to him; that the effect of driving him out of business in that manner would be substantially to lessen competition and create a monopoly in the sale of lamps to the great injury of the public; and that the defendants were discriminating against plaintiff. The complaint contained allegations respecting the decree entered against some of the defendants in a civil action previously pending in the United States Court for New Jersey but plaintiff was not a party to the action and had no personal interest in its subject-matter. And the complaint contained further allegations relating to a criminal prosecution against some of the defendants in the United States Court for Illinois, but that was long prior to the time plaintiff entered business at Denver and it had no bearing whatever upon any justiciable issue appropriate for determination in this case. The prayer was for injunctive relief and treble damages. The court dismissed the action for failure of the amended complaint to state a claim for which relief could be granted, and plaintiff appealed.

The general principles of the common law relating to contracts for the restriction or suppression of competition in the markets, agreements to fix prices, concerts to divide marketing territories, understandings to apportion customers, meeting of minds to restrict production, unity of purpose to furnish inferior products, and other like practices which tend to raise prices or otherwise take from buyers or consumers the advantages which accrue to them from free competition in the markets are familiar to all and therefore do not call for elaboration here. But the resulting restraints of trade were not penalized and they did not give rise to any actionable wrong. The Sherman Act, approved July 2, 1890, 26 Stat. 209, 15 U.S.C.A. §§ 1-7, 15 note, took its origin from that commonlaw background, and its primary purposes were more effective protection of the public from the evils of restraints on the competitive system. It extended the inhibition to any combination or conspiracy, whatever its form, having injurious effects of that kind upon the competitive system, and it provided both public and private remedies for the injuries flowing from the restraints. United States v. Addyston Pipe & Steel Co., 6 Cir., 85 F. 271, 46 L.R.A. 122, affirmed 175 U.S. 211, 20 S.Ct. 96, 44 L.Ed. 136; Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 31 S.Ct. 502, 55 L.Ed. 619, 34 L.R.A.,N.S., 834, Ann.Cas. 1912D, 734; Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311, 128 A.L.R. 1044.

Founded upon these broad concepts of public policy, the Act is limited in operative scope and effect to combinations, agreements, or concerts which tend to prejudice the public interest by unduly restricting competition or unduly obstructing the due course of trade, or which because of their evident purpose or inherent nature injuriously restrain trade in the competitive markets. Wilder Manufacturing Co. v. Corn Products Refining Co., 236 U.S. 165, 35 S.Ct. 398, 59 L.Ed. 520, Ann. Cas.1916A, 118; Ramsay Co. v. Associated Bill Posters of United States and Canada, 260 U.S. 501, 43 S. Ct. 167, 67 L.Ed. 368; United States v. American Linseed Oil Co., 262 U.S. 371, 43 S.Ct. 607, 67 L.Ed. 1035; Paramount Famous Lasky Corp. v. United States, 282 U.S. 30, 51 S.Ct. 42, 75 L.Ed. 145. A common form of such combination, agreement, or concert is one having for its purpose or tendency the raising or fixing of prices, or...