United States v. Carrozzo

• Decision Date: 07 April 1941
• Docket Number: No. 32271.,32271.
• Citation: 37 F. Supp. 191
• Parties: UNITED STATES v. CARROZZO et al.
• Court: U.S. District Court — Northern District of Illinois

37 F. Supp. 191

UNITED STATES v. CARROZZO et al.

No. 32271.

District Court, N. D. Illinois, E. D.

February 4, 1941.

Judgment Affirmed April 7, 1941.

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Thurman Arnold, Asst. Atty. Gen., and J. Albert Woll, U. S. Atty., and Leo F. Tierney and Daniel B. Britt, Sp. Assts. to Atty. Gen., all of Chicago, Ill., Richard P. Shanahan and Thomas H. Daly, Sp. Assts. to Atty. Gen., both of Washington, D. C., and David R. Mason, Sp. Asst. to Atty. Gen., of Chicago, Ill., for the United States.

Joseph R. Roach and Samuel H. Shapiro, both of Chicago, Ill., for defendants International Hod Carriers, Building & Common Laborers District Council of Chicago and Vicinity and others.

Hartshorn, Thomas, Abele, Phillips & Mitchell, of Cleveland, Ohio, and Nash & Ahern, of Chicago, Ill., for William E. Maloney and others.

Judgment Affirmed April 7, 1941. See 61 S.Ct. 839, 85 L.Ed. ___.

SULLIVAN, District Judge (after stating the facts as above).

Objections third and fourth as to substance, and objection fifth, will be first considered.

The offense charged in the present indictment is a combination and conspiracy in restraint of trade, in violation of Section One of the Sherman Act, 15 U.S.C.A. § 1, which provides: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal."

The indictment charges the defendants with "knowingly having entered into and engaged in a combination and conspiracy unreasonably to prevent persons, partnerships and corporations engaged in the manufacture of truck-mixers in states other than the State of Illinois, from selling and delivering truck-mixers in, and shipping the same to the Chicago area, where they would enter into competition with other types of equipment, machines and devices employed in the production of concrete, and where their use would result in the reduction of the cost, and an improvement of the quality of concrete to consumers, which conspiracy and combination in fact has been and is now in restraint of trade and commerce in truck-mixers among the several states." Then follows a detailed description of the means used to effectuate the combination and conspiracy, such as strikes, and threats of strikes, to prevent the use of truck-mixers in the Chicago area; warnings to contractors in the Chicago area that defendant Union would prohibit the use of truck-mixers in the Chicago area unless in each instance of their use they were manned by one of its engineer members; the use of threats to force paving contractors in the Chicago area to enter into working agreements with the Union of Operating Engineers providing that in the event truck-mixers were used, the contractors would employ the same number of men as would be employed if truck-mixers were not used. The indictment then sets out that "the aforesaid conspiracy, and the acts performed by the defendants, were not intended to increase wages, shorten hours of labor, better working conditions, or promote or effectuate any other legitimate or normal object of a labor union."

Defendants insist that on the contrary, in doing the acts with which they are charged they were carrying out the legitimate and normal objects of a labor union, in that they were attempting to prevent the dismissal of any of their members where contractors in the Chicago area were using what are alleged in the indictment to be labor saving truck-mixers. It appears that truck-mixers are concrete mixers mounted on trucks, which either mix the cement or agitate pre-mixed cement en route to a job, while "the other type of mixers" are located at the job site and may be mounted on tractors or other conveyances which move about the job site, or are stationed at some fixed place on the job site. One type mixes or agitates the ingredients while going to the job site, while the other type operates and does the mixing only at the job site, where it has been the practice to employ a member of the International Union of Operating Engineers to operate them. Use of truck-mixers attempts to do away with the services of this engineer, who has for years had jurisdiction of the operation of "the other type of cement mixers". The indictment alleges, and the Government contends, that the use of truck-mixers would result in a savings of labor costs through reduction of the number of men employed. Defendants insist that this is exactly what they are objecting to, and the purpose of the strikes, or threatened strikes, was to compel cement contracts in the Chicago area to accede to the Union's demands that the services of these engineers be retained on jobs where truck-mixers are used; that these are activities within the legitimate objects of a labor union. That these activities grew out of a "jurisdictional labor dispute" between the members of the International Union of Operating Engineers Local 150, whose members operate the mixers, and the Teamsters' and Chauffeurs Union, whose members operate the trucks, in which dispute the Engineers Union has refused to relinquish jurisdiction over truck-mixers, which are essentially concrete mixers, and over which the Union has for years had jurisdiction. There appears to be nothing unreasonable in these demands, and only lawful means seem to have been used to accomplish them. I am of the opinion that defendants, under such circumstances, are immune from prosecution under the Sherman Act, by reason of the provisions of the Norris-LaGuardia Act, which enlarges the scope of Section 20 of the Clayton Act. The Sherman Act was modified by the Clayton Act of October 15th, 1914. Section 6 of the Clayton Act, Title 15, Sec. 17, U.S.C.A., provides that a labor organization, or the members thereof, shall not be held or construed to be an illegal combination or conspiracy in restraint of trade, under the anti-trust laws.

Section 20 of the Clayton Act, Title 29, Sec. 52, U.S.C.A., regulates the granting of restraining orders and injunctions by United States Courts in a designated class of cases, with respect to the character of acts which are exempt, and also provides that none of the acts specified therein shall be considered or held to be violations of any law of the United States.

The Norris-LaGuardia Act, Title 29, Sec. 105, U.S.C.A., enlarged the scope of the Clayton Act and prohibits any court from issuing an injunction on the ground that any person or persons participating in a labor dispute are engaged in an unlawful combination or conspiracy because of the doing of certain acts.

Defendants contend that no facts are set out in the instant indictment which show any unreasonable or injurious restraint of trade, such as is condemned by the Sherman Act. It must clearly appear from the indictment that the activities with which defendants are charged are such as unreasonably restrain interstate commerce and prejudice the public interests, and are not activities which come within the normal, legitimate and lawful activities which may be employed by a labor union, and which, under Sections 6 and 20 of the Clayton Act, and the Norris-LaGuardia Act, are exempt from prosecution under the Sherman Act. Such normal, legitimate and lawful activities of a labor union include the calling of strikes, or threatening to call strikes, in order to enforce their demands, as in the present case a demand against the use of labor saving devices which will displace their members; or, in the alternative, the demand that if the labor saving device is used the same number of men be employed as would be if the other type of mixer were used. These are legitimate and lawful activities which a labor union is permitted to carry on in an effort to maintain employment and certain working conditions for its members, and any restraint of trade or commerce attendant thereon is only indirect and incidental. Nothing unreasonable appears in the demands of the Engineers' Union. It has for many years had jurisdiction of concrete mixers, and it has as much right on the one hand to demand that its members continue to operate the mixers, as the Teamsters' and Chauffeurs' Union on the other hand has the right to demand that its members now be permitted to operate the truck-mixers. In the case of Terrio v. S. N. Nielson Construction Company, D.C., 30 F.Supp. 77, 79, the court said: "Such competition between labor unions is lawful, and the acts pleaded in furtherance thereof, even to the extent of threatening strikes in furtherance of such lawful object, are lawful and proper."

The test of a violation of the Sherman Act is not that a demand or a strike are unreasonable, but that the restraint upon interstate commerce is unreasonable. Standard Oil Company 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; United Leather Workers v. Herkert & Meisel Trunk Co., 265 U.S. 457, 44 S.Ct. 623, 68 L.Ed. 1104, 33 A.L.R. 566; Levering & Garrigues Company v. Morrin, 289 U.S. 103, 53 S.Ct. 549, 77 L.Ed. 1062.

In the instant case no acts are alleged to have been performed which would constitute restraint of trade in commercial competition in the marketing of truck-mixers. In Schechter Poultry Corp. v. United States, 295 U.S. 495, 55 S.Ct. 837, 851, 79 L.Ed. 1570, 97 A.L.R. 947, the Supreme Court said: "The distinction between direct and indirect effects of intrastate transactions upon interstate commerce must be recognized as a fundamental one." Here there is no restraint charged which would be calculated to restrict production of truck-mixers or in any way control the market. There is no restraint of commercial competition such as would substantially affect market prices; no agreements to fix prices, divide marketing territories, apportion customers, restrict production, or any like practices which would tend to raise prices, or take from buyers the advantages accruing...