Isidor Straus v. American Publishers Association

• Decision Date: 01 December 1913
• Docket Number: No. 19,19
• Citation: 58 L.Ed. 192,231 U.S. 222,34 S.Ct. 84
• Parties: ISIDOR STRAUS and Nathan Straus, Composing the Firm of R. H. Macy & Company, Plffs. in Err., v. AMERICAN PUBLISHERS' ASSOCIATION et al
• Court: U.S. Supreme Court

231 U.S. 222

34 S.Ct. 84

58 L.Ed. 192

ISIDOR STRAUS and Nathan Straus, Composing the Firm of R. H. Macy & Company, Plffs. in Err.,

v AMERICAN PUBLISHERS' ASSOCIATION et al.

No. 19.

Argued March 7, 1913.

Decided December 1, 1913.

Messrs. Wallace Macfarlane and Edmond E. Wise for plaintiffs in error.

[Argument of Counsel from page 223 intentionally omitted] Messrs. Stephen H. Olin and John G. Milburn for defendants in error.

[Argument of Counsel from pages 224-229 intentionally omitted] Mr. Justice Day delivered the opinion of the court:

This is a writ of error to review a judgment of the supreme court of the state of New York, rendered on remittitur from the court of appeals, refusing to grant to the plaintiffs in error an injunction restraining any interference with their purchase and sale of copyrighted books, and damages, the defendants acting under an agreement alleged to be violative of the laws of New York and the Sherman anti-trust act (26 Stat. at L. 209, chap. 647, U. S. Comp. Stat. 1901, p. 3200).

The suit originated in a bill filed in the supreme court of the state of New York for New York county, in which the plaintiffs in error alleged that they conducted a department store in New York city, a large department of which was devoted to books, magazines, and pamphlets; that, because of their methods of business, they had been able to undersell other retail book stores; that the defendants in error, through the American Publishers' Association and the American Booksellers' Association, and by means of resolutions and agreements, with the co-operation of the Associations and their members, and by the use of various practices and methods, to the end that books should be sold to the booksellers only who would maintain the retail price upon net copyrighted books for one year, and who would not sell books to anyone who would cut such prices, had restrained and prevented competition in the state of New York and throughout all of the United States in the supply and price of books, and that the business of the plaintiffs in error had been seriously affected; and they prayed that the combination and agreements be declared unlawful, and that defendants be enjoined from acting thereunder or accomplishing the purposes thereof, and for damages. A demurrer having been interposed to the complaint and sustained by the court at special term, and the interlocutory judgment there entered having been reversed upon appeal to the appellate division of the first department, the court of appeals, permission having been granted to appeal and the question certified, affirmed the decision, and held that, so far as the bill related to copyrighted books, the demurrer was good; but that as to uncopyrighted books, the complaint stated facts sufficient to constitute a cause of action. 177 N. Y. 473, 64 L.R.A. 701, 101 Am. St. Rep. 819, 69 N. E. 1107.

Amended answers having been filed, upon trial to the court without a jury, the court made findings of fact from which it appears that the material allegations of the complaint are true, as above set forth, and further, that about April 1, 1904, and after the decision of the court of appeals reported in 177 N. Y., the Associations amended their resolutions and agreements so as to restrict the application and operation thereof to copyrighted books only; that about January 19, 1907, the Publishers' Association revoked all its former resolutions and adopted a new resolution, but that the Associations had continued the same course as to copyrighted books as was followed before the passage of such resolution. The court concluded that the resolutions and agreements, so far as they related to uncopyrighted books, were unlawful and contrary to the laws of New York, and to that extent granted relief by way of injunction and damages; but held that as to copyrighted books, the agreements, resolutions, and acts of the defendants were not unlawful, and entered an interlocutory judgment accordingly; and in its opinion the court stated that the former decision of the court of appeals in the case (177 N. Y. 473) was controlling. Plaintiffs in error excepted to the conclusions of law made by the court, restricting the illegality of the combinations to uncopyrighted books, and requested that certain conclusions be made, and excepted to the refusal to find the conclusions submitted by them.

From that part of the interlocutory judgment denying relief as to copyrighted books, the plaintiffs in error appealed to the appellate division, which, also upon the authority of 177 N. Y. 473, affirmed the interlocutory judgment, and judgment of affirmance was entered in the supreme court; and, with permission, an appeal was taken to the court of appeals, which answered in the negative the question certified by the appellate division as to whether plaintiffs in error, in so far as copyrighted books were concerned, were entitled to relief, adhering to its previous decision (177 N. Y. 473). 193 N. Y. 496, 86 N. E. 525. Judgment was so entered on remittitur to the supreme court. The report of the referee appointed to ascertain the amount of the damages sustained by the plaintiffs in error in the sale of uncopyrighted books having been filed and approved, final judgment was entered in the supreme court, granting an injunction and damages as to uncopyrighted books only, and upon appeal to the court of appeals that court affirmed the final judgment (199 N. Y. 548, 93 N. E. 1133) and remitted the case to the supreme court. Judgment on remittitur was accordingly entered, and this writ of error sued out to review that judgment.

In this court a motion was made to dismiss the writ of error upon the ground that it presents no Federal question so saved and brought here as to permit a review of such question. When the case was before the court of appeals, upon demurrer to the complaint (177 N. Y. 473), that court held that the agreement, as to copyrighted books, was not illegal, because of the monopoly granted to the holder of a copyright under the statutes of the United States. The court held that the agreement, as to uncopyrighted books, however, was in violation of the so-called anti-trust law of New York, chapter 690, Laws of 1899, making contracts, agreements, etc., creating monopoly, or restraining or preventing competition in the supply or price of articles or commodities void as against public policy. Subsequently the agreement was modified so as to apply to copyrighted books only, and findings of fact were specifically made upon which the case again went to the court of appeals of New York upon the certified question: 'Are the plaintiffs, under the findings of fact contained in the decision in this case, entitled, in so far as copyrighted books are concerned, to the relief demanded in the complaint, or to any relief as against the defendants in this case?' Upon the record the court of appeals by a majority adhered to its former decision, notwithstanding the decision of Bobbs-Merrill Co. v. Straus, 210 U. S. 339, 52 L. ed. 1086, 28 Sup. Ct. Rep. 722, which had in the meantime been decided by this court, and held that, as the object of the copyright and patent statutes was to give monopolies, contracts made by the owners of copyrights to secure the fullest protection in the enjoyment of their monopolies would not be condemned by the courts as being in unlawful restraint of trade; at least, not until the Supreme Court of the United States had...