268 U.S. 64 (1925), 365, Industrial Association of San Francisco v. United States

Docket Nº:No. 365
Citation:268 U.S. 64, 45 S.Ct. 403, 69 L.Ed. 849
Party Name:Industrial Association of San Francisco v. United States
Case Date:April 13, 1925
Court:United States Supreme Court

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268 U.S. 64 (1925)

45 S.Ct. 403, 69 L.Ed. 849

Industrial Association of San Francisco


United States

No. 365

United States Supreme Court

April 13, 1925

Argued March 10, 1925




For the purpose of freeing the local building industry from domination by trade unions, numerous building contractors and dealers in building materials in San Francisco combined to establish, in effect, the "open shop" plan of employment, by requiring builders who desired building materials of certain specified kinds to obtain permits therefor from a Builders' Exchange, and by refusing such permits to those who did not support the plan. Held that the

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combination did not violate the Sherman Anti-Trust Act, because

(1) Its object was confined to a purely local matter, and interference with interstate commerce was neither intended nor desired. P. 77.

(2) The materials for which permits were required were all produced in California, except one kind as to which permits were required only after they had entered the state and become commingled with the common mass of local property, so that their interstate movement and commercial status had ended. P. 78.

(3) Any interference with the free movement of supplies from other states was incidental, indirect, and remote, due merely to lack of demand for such supplies upon the part of builders who, through being unable to purchase the local permit materials, were unable to go on with their jobs. P. 80.

(4) Instances in which it was alleged that persons in other states were directly prevented or discouraged from shipping into California were either not proven or were related to a practice abandoned long before the suit was instituted, with no probability of renewal, or were sporadic and doubtful and of so little weight as evidence of the conspiracy alleged as to call for application of the maximum de minimis non currat lex. P. 83.

293 F. 925 reversed.

Appeal from a decree of the district court enjoining the appellant associations, corporations, and individuals from conduct found to violate the Anti-Trust Act.

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SUTHERLAND, J., lead opinion

MR. JUSTICE SUTHERLAND delivered the opinion of the Court.

This is a suit by the United States against a number of voluntary associations, corporations, and individuals, charging them with engaging, and threatening to continue to engage, in a conspiracy to restrain trade and commerce in building materials among the several states in violation of the Anti-Trust Act of July 2, 1890, 26 Stat. 209. The bill prays for an injunction restraining the further execution of the alleged conspiracy, for a dissolution of certain of the associations as illegal, and for other relief. After a hearing, the federal district court declined to dissolve any of the appellants or interfere with their general activities, but entered a decree enjoining them specifically from (a) requiring any permit for the purchase,

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sale, or use of building materials or supplies produced without the state of California and coming into that state in interstate or foreign commerce; (b) making, as a condition for the issuance of any permit for the purchase, sale, or use of building materials or supplies, any regulations that will interfere with the free movement of building materials, plumbers' or other supplies produced without the state; (c) attempting to prevent or discourage any person without the state from shipping building materials, or other supplies to any person within the state; or (d) aiding, abetting, or assisting, directly or indirectly, individually or collectively, others to do any of the foregoing matters or things. 293 F. 925. A reversal of this decree is sought upon the ground, mainly, that the evidence wholly fails to show any contract, combination, or conspiracy in restraint of interstate or foreign trade or commerce, or a violation in any respect of the provisions of the Anti-Trust Act. Other grounds assigned, in view of the conclusion we have reached, we put aside as unnecessary to be considered.

That there was a combination and concerted action among the appellants is not disputed. The various agreements, courses of conduct and acts relied upon to establish the case for the government arose out of a long continued controversy -- or, more accurately, a series of controversies -- between employers engaged in the construction of buildings in San Francisco, upon the one side, and the building trade unions of San Francisco, of which there were some 50 in number with a combined membership of about 99 percent of all the workmen engaged in the building industries of that city, upon the other side.

Prior to February 1, 1921, the unions had adopted and enforced, and were then enforcing, many restrictions bearing upon the employment of their members, which the employers, and a large body of other citizens, considered to be unreasonable, uneconomic, and injurious to

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the building industries, resulting, it was asserted, in decreased production, increased cost, and generally retarded progress. Among the restrictions complained of were rules limiting the number of apprentices, limiting the amount of work, limiting or forbidding the use of labor-saving devices, and interfering with the legitimate authority of the employer. The plumbers' union, for example, enforced the following, among others: no union plumber, whatever the emergency, was permitted to work on nonunion material or to work overtime on Saturday without permission of the union; detailed reports were required, showing the number of fixtures set each day, and men who exceeded the standard fixed by the union were disciplined; the time which any employer was permitted to stay on a job was limited to two hours a day; as many men as the union saw fit could be ordered on a job, regardless of the wishes of the employer. Among the restrictions imposed by the painters' union were these: wide brushes with long handles for roof painting were prohibited, and it was required that all such work should be done with a small brush; certain labor-saving devices were prohibited, and union painters declined to paint nonunion lumber.

The unions rigidly enforced the "closed shop" -- that is, they denied the right of the employer to employ any workman, however well qualified, who was not a member of a San Francisco union, and this applied to a member of a labor union in another locality, who, moreover, practically was...

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