U.S. Supreme Court U.S. v. BORDEN CO., 308 U.S. 188 (1939)

[Page 308 U.S. 188, 192]

292, 7 U.S.C.A. 291, 292, and the Agricultural Marketing Agreement Act. With respect to count three, the District Court held that it was duplicitous, in the view that it charged several separate conspiracies and also that it did not definitely charge a restraint of interstate commerce.

The judgment expressly overruled the demurrers and motions to quash so far as they challenged the constitutionality of the Sherman Act or the sufficiency of the allegations of unlawful conspiracy, and also so far as it was contended that interstate commerce was not involved in counts one, two and four. The court added that it overruled all the defendants' contentions which it had not specifically overruled or sustained. The judgment ends by dismissing the indictment as to all defendants.

The first question presented concerns our jurisdiction. The exceptional right of appeal given to the Government by the Criminal Appeals Act is strictly limited to the instances specified. [Footnote 1] The provision invoked here is the

[Page 308 U.S. 188, 196]

broad and sweeping terms of the Sherman Act. Such cooperative organizations, in and of themselves, were not to be construed as illegal combinations or conspiracies in restraint of trade under the antitrust laws'. 28 F.Supp. 183. But the court did not hold that, by these provisions of the Clayton Act, either the defendants Pure Milk Association and its officers and agents or the defendants Milk Wagon Drivers Union, Local 753, and its officials, (albeit these organizations were not in themselves illegal combinations or conspiracies) were rendered immune from prosecution under the Sherman Act for their alleged participation in the combinations and conspiracies charged in counts one, two and four of the indictment. The Sherman Act was not construed by the District Court as having been limited to that extent by the Clayton Act.

The court invoked the Capper-Volstead Act,3 as its judgment shows, only in relation to certain defendants, that is, the Pure Milk Association, an agricultural cooperative organization, and its officers and agents. We shall consider later the effect of that statute upon the charge against those defendants.

The court dismissed the indictment as to all defendants, and we think it manifest that this ruling in its bearing upon counts one, two and four was due to the effect upon the Sherman Act which the court attributed to the Agricultural Marketing Agreement Act. [Footnote 4]

[Page 308 U.S. 188, 200]

actual party to the agreements. Section 8b. [Footnote 7] The orders are also to be made by the Secretary for the purpose of regulating the handling of the agricultural commodity to which the particular order relates. Section 8c(3 ) (4).8 That the field covered by the Agricultural Act is not coterminus with that covered by the Sherman Act is manifest from the fact that the former is thus delimited by the prescribed action participated in and directed by an officer of government proceeding under the authority specifically conferred by Congress. As to agreements and arrangements not thus agreed upon or directed by the Secretary, the Agricultural Act in no way impinges upon the prohibitions and penalties of the Sherman Act, and its condemnation of private action in entering into combinations and conspiracies which impose the prohibited restraint upon interstate commerce remains untouched.

[Page 308 U.S. 188, 201]

such commodity or product thereof. The making of any such agreement shall not be held to be in violation of any of the antitrust laws of the United States, and any such agreement shall be deemed to be lawful: Provided, That no such agreement shall remain in force after the termination of this chapter'.

Another provision is found in Section 3(d)10 of the Agricultural Marketing Agreement Act, relating to awards or agreements resulting from the arbitration or mediation by the Secretary of Agriculture or by a designated officer or employee of the Department of Agriculture as provided in Section 3(a),11 and meetings for that purpose and awards or agreements resulting therefrom which have been approved by the Secretary of Agriculture as rovided in Section 3(b).12 Section 3(d) provides: 'No meeting so held and no award or agreement so approved shall be deemed to be in violation of any of the antitrust laws of the United States'.

These explicit provisions requiring official participation and authorizations show beyond question how far Congress intended that the Agricultural Act should operate to render the Sherman Act inapplicable. [Footnote 13] If Congress had desired to grant any further immunity, Congress doubtless would have said so.

[Page 308 U.S. 188, 208]

man Act as inapplicable upon the ground that interstate commerce is not involved, and the question of the bearing upon that commerce of the acts charged is not before us.

Similarly, the contention of the defendants who are labor officials that the Sherman Act does not apply to labor unions or labor union activities is not open on this appeal. The District Court did not construe the Sherman Act as inapplicable to these defendants and the Government's appeal, under the restriction of the Criminal Appeals Act, does not present that question.

The appeal as to count three is dismissed. The judgment is reversed as to counts one, two and four, and the cause is remanded to the District Court for further proceedings in conformity with this opinion. It is so ordered.

Appeal dismissed in part and judgment reversed and cause remanded in part. Footnotes

Footnote 1 This Act, 18 U.S.C. 682, 18 U.S.C.A. 682; Jud.Code, Sec. 238, 28 U.S.C. 345, 28 U.S.C.A. 345, provides:'An appeal may be taken by and on behalf of the United States from the district courts direct to the Supreme Court of the United States in all criminal cases, in the following instances, to wit:'From a decision or judgment quashing, setting aside, or sustaining a demurrer to, any indictment, or any count thereof, where such decision or judgment is based upon the invalidity, or construction of the statute upon which the indictment is founded.'From a decision arresting a judgment of conviction for insufficiency of the indictment, where such decision is based upon the invalidity or construction of the statute upon which the indictment is founded.'From the decision or judgment sustaining a special plea in bar, when the defendant has not been put in jeopardy. ...'Pending the prosecution and determination of the appeal in the foregoing instances, the defendant shall be admitted to bail on his own recognizance: Provided, That no appeal shall be taken by or allowed the United States in any case where there has been a verdict in favor of the defendant'.

Footnote 2 Section 6 of the Clayton Act, 38 Stat. 730, 15 U.S.C. 17, 15 U.S. C.A. 17, provides:'The labor of a human being is not a commodity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor, agricultural, or horticultural organizations, instituted for the purposes of mutual help, and not having capital stock or conducted for profit, or to forbid or restrain individual members of such organizations from lawfully carrying out the legitimate objects thereof; nor shall such organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade, under the antitrust laws'.

Footnote 3 42 Stat. 388, 7 U.S.C. 291, 292, 7 U.S.C.A. 291, 292.

Footnote 4 The District Court referred, in passing, to the Co-operative Marketing Act of July 2, 1926, 44 Stat. 803, 7 U.S.C. 455, 7 U.S.C.A. 455, and to the provisions of the Agricultural Adjustment Act of 1933, 48 Stat. 31, as amended in 1935, 49 Stat. 750, which was followed by the Agricultural Marketing Agreement Act of 1937, 50 Stat. 246, 7 U.S.C.A. 601 et seq.

Footnote 5 See General Motors Acceptance Corporation v. United States, 286 U.S. 49, 61, 52 S.Ct. 468, 472, 82 A.L.R. 600.

Footnote 6 7 U.S.C.Supp.IV, 602(1), 7 U.S.C.A. 602(1).

Footnote 7 7 U.S.C.Supp.IV, Sec. 608b, 7 U.S.C.A. 608b.

Footnote 8 7 U.S.C.Supp.IV, Sec. 608c(3)(4), 7 U.S.C.A. 608c(3, 4).

Footnote 9 7 U.S.C.Supp.IV, Sec. 608b, 7 U.S.C.A. 608b.

Footnote 10 50 Stat. 249, 7 U.S.C.A. 671(d).

Footnote 11 50 Stat. 248, 7 U.S.C.A. 671(a).

Footnote 12 50 Stat. 248, 7 U.S.C.A. 671(b).

Footnote 13 See 77 Cong.Rec., Pt. II, p. 1977; Pt. III, p. 3117.

Footnote 14 Federal Register, August 30, 1939, Order No. 41, Vol. 4, pp. 3764- 3768, 3770.

Footnote 15 42 Stat. 388, 7 U.S.C. 291, 292, 7 U.S.C.A. 291, 292.

Footnote 16 38 Stat. 731, 15 U.S.C.A. 17.

Footnote 17 42 Stat. 388, 7 U.S.C.A. 291, 292.