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HARVARD COLLEGE LIBRAA

JUL 1 1914.

The Clayton Anti-Trust Bill

Its Vicious Labor-Exemption, Anti-Injunction and Contempt
Provisions; Their Effect if Enacted and Held Valid

Written for The American Employer
By HARRY W. VAN DYKE
Counsellor-at-Law, Washington, D. C.

On the 5th of this month the National House of Representatives, by vote of 277 to 54 (102 of the members were absent, or if present did not vote), passed the so-called Clayton anti-trust bill (H. R. 15,657) "to supplement existing laws against unlawful restraints and monopolies and for other purposes." The reason for its

introduction is set forth in the majority report of the Committee on the Judiciary, to which it was referred for consideration, as follows:

"Your committee, after the delivery of a message by the President of the United States on January 20 last to the Congress, making certain recommendations relating to the matter of trusts and monopolies, immediately prepared and published tentative bills. which were designed to give legislative expression to the views contained in the President's message, and, in order that the country might be given ample time to discuss them, the committee conducted public hearings until April 4, at which time they were concluded. This method of dealing with so large a question, though new, met with general response from the business interests of the country, large and small; and, though these hearings imposed upon the committee months of tedious labor, they were exceedingly helpful to all concerned.

"The salient principle of the tentative bills as finally agreed upon, with additional provisions, have been embodied in the one comprehensive bill now reported. * *The bill as proposed will go far to bring about busi

*

ness readjustment with as few, as slight, as easy and simple changes as the object sought will admit of. 'Nothing essential has been disturbed, nothing torn up by the roots, no parts rent asunder which can be left in wholesome combination.' The bill is not designed to destroy or hinder business, but, on the contrary, to help business and the whole people of the country who are related to or affected by it. The able and patriotic message of the President has been ever before us and the program which he proposed is contained in the provisions of the bill, and, if enacted into law, will in truth be 'additional articles in our constitution of peacethe peace which is honor and freedom and prosperity.'

THE "LABOR" PROVISIONS OF THE BILL

One of these few, slight, easy changes, which the committee assures us will make for peace, honor, freedom and prosperity, is embodied in section 7 of the bill, which, instead of strengthening the anti-trust laws in accord with the general purpose, seeks to annul them altogether, as to cerItain classes, by exempting them from their operation. That section reads as follows:

"Section 7. That nothing contained in the anti-trust laws shall be construed to forbid the existence and operation of fraternal, labor, consumers,' agricultural or horticultural organizations, orders or associations 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, orders or associations, from carrying out the legitimate objects thereof; nor shall such organizations, orders or associations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade under the anti-trust laws."

Section 18 limits the power of the federal courts to issue injunctions. It provides:

"That no restraining order or injunction shall be granted by any court. of the United States, or a judge or the judges thereof, in any case between an employer and employes, or between employers and employes, or between employers or between persons employed and persons seeking employment, involving or growing out of a dispute concerning terms or conditions of employment, unless necessary to prevent irreparable injury to property or to a property right of the party making the application, for which injury there is no adequate remedy at law, and such property or property right must be described with particularity in the application, which must be in writing and sworn to by the applicant or by his agent or attor

ney.

"And no such restraining order or injunction shall prohibit any person or persons from terminating any relation of employment; or from ceasing to perform any work or labor, or from recommending, advising or persuading others by peaceful means so to do; or from attending at or near a house or place where any person resides or works or carries on business or happens to be, for the purpose of peacefully obtaining or communicating information, or of peacefully persuading any person to work or to abstain from working; or from ceasing to patronize or to employ any party to such dispute, or for recommending, advising or persuading others by peaceful means so to do; or from paying or giving to, or withholding from, any person engaged in such dispute any strike benefits, or moneys or things of value; or from peace

fully assembling at any place in any lawful manner and for lawful purposes; or from doing any act or thing which might lawfully be done in the absence of such dispute by any party thereto; nor shall any of the acts specified in this paragraph be considered or held unlawful."

Sections 19, 20, 21, 22 and 23 modify the procedure in cases of contempt of court. They read:

"Sec. 19. That any person who shall wilfully disobey any lawful writ, process, order, rule, decree or command of any district court of the United States or any court of the District of Columbia by doing any act or thing therein or thereby forbidden to be done by him, if the act or thing so done by him be of such character as to constitute also a criminal offense under any statute of the United States or at common law, shall be proceeded against for his said contempt as hereinafter provided.

"Sec. 20. That whenever it shall be made to appear to any district court or judge thereof, or to any judge therein sitting, by the return of a proper officer on lawful process, or upon the affidavit of some credible person, or by information filed by any district attorney, that there is reasonable ground to believe that any person has been guilty of such contempt, the court or judge thereof, or any judge therein sitting. may issue a rule, requiring the said person so charged to show cause, upon a day certain, why he should not be punished therefor, which rule, together with a copy of the affidavit or information, shall be served upon the person charged. with sufficient promptness to enable him to prepare for and make return to the order at the time fixed therein.

"If upon such return, in the judgment of the court, the alleged contempt is not sufficiently purged, a trial shall be directed at the time and place fixed by the court: Provided, however, that if the accused, being a natural person, fail or refuse to make return to the rule to show cause. an attachment may issue against his person to compel an answer, and, in

case of his continued failure or refusal, or if for any reason it be impractical to dispose of the matter on the return day, he may be required to give reasonable bail for his attendance at the trial and his submission to the final judgment of the court. Where the accused is a body corporate, an attachment for the sequestration of its property may be issued upon like refusal or failure to answer.

"In all cases within the purview of this act, such trial may be by the court, or, upon demand of the accused, by a jury; in which latter event the court may impanel a jury from the jurors then in attendance, or the court or the judge thereof in chambers may cause a sufficient number of jurors to be selected and summoned, as provided by law, to attend at the time and place of trial, at which time a jury shall be selected and impaneled as upon a trial for misdemeanor, and such trial shall conform, as near as may be, to the practice in criminal cases prosecuted by indictment or upon information.

"If the accused be found guilty, judgment shall be entered accordingly, prescribing the punishment, either by fine or imprisonment, or both, in the discretion of the court. Such fine shall be paid to the United States or to the complainant or other party injured by the act constituting the contempt, or may, where more than one is so damaged, be divided or apportioned among them as the court may direct, but in no case shall the fine to be paid to the United States exceed, in case the accused is a natural person, the sum of $1,000, nor shall such imprisonment exceed the term of six months.

"Sec. 21. That the evidence taken upon the trial of any person so accused may be preserved by bill of exceptions and any judgment of conviction may be reviewed upon writ of error in all respects as now provided by law in criminal cases and may be affirmed, reversed or modified as justice may require. Upon the granting of such writ of error, execution of judgment shall be stayed and the accused, if thereby sentenced to im

prisonment, shall be admitted to bail in such reasonable sum as may be required by the court or by any justice or any judge of any district court of the United States or any court of the District of Columbia.

"Sec. 22. That nothing herein contained shall be construed to relate to contempts committed in the presence of the court, or so near thereto as to obstruct the administration of justice, nor to contempts committed in disobedience of any lawful writ, process, order, rule, decree or command entered in any suit or action in the name of, or on behalf of, the United States,

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but the same, and all other cases of contempt not specifically embraced within Section 19 of this act, may be punished in conformity to the usages of law now prevailing.

"Sec. 23. That no proceeding for contempt shall be instituted against any person unless begun within one year from the date of the act complained of; nor shall any such proceeding be a bar to any criminal prosecution for the same act or acts; but nothing herein contained shall affect any proceedings in contempt pending at the time of the passage of this act."

WHAT DO THESE PROVISIONS MEAN?

"The object of Section 7," explains the Committee on the Judiciary in the majority report, "is to make clear certain questions about which doubt has arisen as to whether or not fra

ternal, labor, consumers', agricultural

or

horticultural organizations, orders or associations, organized for mutual help and not having capital stock or conducted for profit, come within the scope and purview of the Sherman anti-trust law in such a way as to warrant the courts, under interpretations heretofore given to that law, to enter a decree for the dissolution of such organizations, orders or associations, upon a proper showing as may be done in regard to industrial corporations and combinations which have been found to be guilty of violation of its provisions.

"It was contended before your Committee by Mr. Gompers, President of the American Federation of

Labor, that under the interpretation of the Sherman law as construed by the courts, the labor organizations as they exist today might, under certain conditions, be deemed and held illegal combinations in restraint of trade and be dissolved by a decree of the court under section 4 of the act of July 2, 1890" (the Sherman act), "and that the American Federation of Labor and all organizations affiliated with it exist and operate today at the sufference of the administration in power.

***

"In the light of previous decisions of the courts and in view of a possible interpretation of the law which would empower the court to order the dissolution of such organizations and associations, your Committee feels that all doubt should be removed as to the legality of the existence and operations of these organizations and associations and that the law should not be construed in such a way as to authorize their dissolution by the courts under the anti-trust laws, or to forbid the individual members of such associations from carrying out the legitimate and lawful objects of their associations.

"This will be accomplished by the

provisions of of section 7 of this bill. *** It also guarantees to individual members of such organizations, orders or associations the right to pursue, without molestation or legal restraint, the legitimate objects of such associations. This section should be construed in connection with sections 15 to 22, inclusive, which regulate the issuance of injunctions and proof contempts in federal courts. The vide for jury trials in certain cases sections relating to injunctions and contempts constitute for labor a com

plete bill of rights in equitable proceedings in United States courts."

Why were these labor-favoring provisions inserted in a measure proclaimed to be intended to strengthen, not weaken, the operation of the antitrust laws? Mr. Murdock, of Kansas, leader of the Progressives in the debate and a strong advocate of exemption, thus disclosed the reason. "For over a period of ten years," he declared, "this particular battle which many presume is now about to close, has been one of the chief activities here. The men who have headed the American Federation of Labor-Mr. Gompers and those associated with him-have left no stone unturned: they have worked day and night, year in and year out, to accomplish this exemption. They not only have plead with every great national convention for party platform pledges for the enactment of this exemption into law but they have worked here in Washington, in season and out of season, to accomplish this.

of

"And they have accomplished upon occasion in this body, within my experience, political revolution. They have upset party regularity and party majority. They have overriden the veto of a President. They stood here face to face for years against the powerful National Association Manufacturers, which attempted in every way to block the avenues to public service and to keep back this legislation. The old Republican stand-pat leadership for years had as one of its chief activities the defeat of this proposition. They locked and double-locked this proposition in the

pigeon holes of committees, but the leaders of labor who were fighting for it never repined; they never lost heart. They kept fighting for it. Why? Because they believed in it."

At first glance one wonders whether it could have occurred to Mr. Murdock and the 277 other members of the National House of Representatives who shared his view that the very fact that the proposition was opposed by the National Association of Manufacturers, an

organization numbering among its members thousands of intellectually competent, well informed men, many of them eminent publicists and economists, who were conducting

business concerns of the utmost importance to the country at large no less than to the laboring classes themselves, and the fact that the measure was also opposed by the leaders of a great political party, which had much. to lose by refusing to yield to the demands of labor, as was proven at the last general election, constituted a most cogent argument in favor of sustaining rather than emasculating the anti-trust laws so far as they relate to labor unions.

For are not the opinions on such a subject of men like those who compose the National Association of Manufacturers and the many other

associations of business men that are protesting against the adoption of this measure, and the opinions of experienced, properly posted political leaders like the "stand-patters" referred to, entitled to far greater weight than those of irresponsible professional labor leaders who have never had to do with most of the problems that confront the employing class?

of commodities, or have they more. to gain from the success of the employing class in retaining what-often really inadequate-means they now have of protecting their property from unreasonable or violently enforced demands? The answer is obvious. While the present general scheme of political and social organization remains in effect, the way to benefit even labor itself is not to exempt it from the operation of laws that apply to all other classes in the fields of industry, finance and public service.

But did the 277 Representatives who voted for the inclusion of the

exemption, injunction and contempt provisions of the bill do so because they were convinced that the demands of labor in these respects were just, or was it for reasons merely and selfishly political? In this connection Mr. Moore, of Pennsylvania, threw a side light on the situation in the course of the discussion in the House that is most significant. Replying to a question asked by Mr. Murdock, he said:

"Mr. Chairman, I have not dodged any issue, and I have not waited for a nod from the galleries to determine how I shall vote, as the gentleman. from Kansas has persistently done throughout this debate. *** I have not even changed the Record, as the gentleman from Kansas has done this. morning. After pleasing our labor friends in the galleries by frequent glances up that way and by smiles and nods, and after referring to the National Association of Manufacturers, possibly forgetting that the late Progressive candidate for governor in Massachusetts, Mr. Bird, was not only a Progressive but a leading member of the Manufacturers' Association which he denounced, and for which denunciation he received applause, the gentleman from Kansas changed the Record this morning so that instead of calling that Association the 'corrupt' National Association of Manufacturers he has, with Col. Bird, the Progressive, in mind, changed it to the 'powerful' National Association of Manufacturers. I do not have to correct the Record in that way, because

The effort to defeat the adoption of the measure is self-serving, the labor leaders contend. But so is the effort on their part to secure its adoption. And from the success of which of these classes have the people of the country at large more to gain? From that of the labor leaders, with the consequent opportunity they would have either of ruining business concerns. altogether or of extorting from employers concessions that would make necessary further increases in the price

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