IOWA I. TRUSTS, COMBINATIONS, AND MONOPOLIES A. GENERAL ANTITRUST LAWS CONSTITUTIONAL PROVISIONS Const. (1857) art. VIII, sec. 12. Amendment or repeal of lawsExclusive privileges.—Subject to the provisions of this article, the General Assembly shall have power to amend or repeal all laws for the * * * granting of special or exclusive privileges or immunities, by a vote of two-thirds of each branch of the General Assembly; and no exclusive privileges, except as in this article provided, shall ever be granted. STATUTORY PROVISIONS Sec. 9906. Pools and trusts.-Any corporation organized under the laws of this or any other state or country for transacting or conducting any kind of business in this state, or any partnership, association, or individual, creating, entering into, or becoming a member of, or a party to, any pool, trust, agreement, contract, combination, confederation, or understanding with any other corporation, partnership, association, or individual, to regulate or fix the price of any article of merchandise or commodity, or to fix or limit the amount or quantity of any article, commodity, or merchandise to be manufactured, mined, produced, or sold in this state, shall be guilty of a conspiracy. (C97, sec. 5060; C24, 27, 31, sec. 9906.) Sec. 9907. Corporation not to enter.-No corporation shall issue or own trust certificates, and no corporation, nor any agent, officer, employee, director, or stockholder of any corporation, shall enter into any combination, contract, or agreement with any person or corporation, or with any stockholder or director thereof, for the purpose of NOTE.-Art. VIII, secs. 1-11 and the remainder of sec. 12, empower the legisla ture to enact the general corporation act, limit the state's possible interest in private corporations, specify certain aspects of state banking law. placing the management or control of such combination or combinations, or the manufactured product thereof, in the hands of any trustee or trustees, with intent to limit or fix the price or lessen the production or sale of any article of commerce, use, or consumption, or to prevent, restrict, or diminish the manufacture or output of any such article. (C97, sec. 5061; C24, 27, 31, sec. 9907.) Sec. 9908. Penalty.-Any corporation, company, firm, or association violating any of the provisions of sections 9906 and 9907 shall be fined not less than five hundred nor more than five thousand dollars, and any president, manager, director, officer, agent, or receiver of any corporation, company, firm, or association, or any member of any corporation, company, firm, or association, or any individual, found guilty of a violation thereof, shall be fined not less than five hundred nor more than five thousand dollars, or be imprisoned in the county jail not to exceed one year, or both. (C97, sec. 5062; S13, sec. 5062; C24, 27, 31, sec. 9908.) Sec. 9909. Contracts void. All contracts or agreements in violation of any provisions of sections 9906 to 9908, inclusive, shall be void. (C97, sec. 5063; C24, 27, 31, sec. 9909.) Sec. 9910. Defense.-Any purchaser of any article or commodity from any individual, company, or corporation transacting business contrary to any provisions of sections 9906 to 9909, inclusive, shall not be liable for the price or payment thereof, and may plead such provisions as a defense to any action for such price or payment. sec. 5064; C24, 27, 31, sec. 9910.) (C97, Sec. 9911. Forfeiture of charter.-Any corporation created or organized by or under the law of this state, which shall violate any provision of sections 9906 to 9910, inclusive, shall thereby forfeit its corporate right and franchise, as provided in section 9912. (C97, sec. 5065; C24, 27, 31, sec. 9911.) Sec. 9912. Notice by secretary of State.-The secretary of state, upon satisfactory evidence that any company, or association of persons incorporated under the laws of this state has entered into any trust, combination, or association in violation of the provisions of sections 9906 to 9911, inclusive, shall give notice to such corporation that, unless it withdraws from and severs all business connection with said trust, combination, or association, its articles of incorporation will be revoked at the expiration of thirty days from date of such notice. (C97, sec. 5066; C24, 27, 31, sec. 9912.) Sec. 9913. Enforcement-Inquiry by grand jury.-County attor neys, in their counties, and the attorney general shall enforce the provisions of a public nature in sections 9906 to 9912, inclusive, and it shall be the duty of the grand jury to inquire into and ascertain if there exists any pool, trust, or combination within their respective counties. (C97, sec. 5067; C24, 27, 31, sec. 9913.) Sec. 9914. Fees of prosecutors.-Any county attorney or the attorney general securing a conviction under the provisions of sections 9906 to 9912, inclusive, shall be entitled, in addition to such fee or salary as by law he is allowed for such prosecution, to one-fifth of the fine recovered. When the attorney general and county attorney act in conjunction in the prosecution of any action under such provisions, they shall be entitled to one-fourth of the fine recovered, which they shall divide equally between them, where there is no agreement to the contrary. (C97, sec. 5067; C24, 27, 31, sec. 9914.) Sec. 9915. Combinations, pools, and trusts-Fixing prices.-It shall be unlawful for any person, company, partnership, association, or corporation owning or operating any business of buying, selling, handling, consigning, or transporting any commodity or any article of commerce: 1. To enter into any agreement, contract, or combination with any other dealer or dealers, partnership, company, corporation, or association of dealers, whether within or without the state, engaged in like business, for the fixing of the price or prices at which any commodity or any article of commerce should be sold by different dealers or sellers. 2. To divide between said dealers the aggregate or net proceeds of the earnings of such dealers and sellers, or any portion thereof. 3. To form, enter into, maintain, or contribute money or anything of value to any trust, pool, combination, or association of persons of whatsoever character or name, which has for any of its objects the prevention of full and free competition among buyers, sellers, or dealers in any commodity or any article of commerce. 4. To do or permit to be done by his or their authority any act or thing whereby the free action of competition in the buying or selling of any commodity or any article of commerce is restrained or prevented. (S13, sec. 5067-a; C24, 27, 31, sec. 9915.) Sec. 9916. Labor-Unions.-The labor of a human being either mental or physical is not a commodity or article of commerce and it shall not be unlawful for men and women to organize themselves into or carry on unions for the purpose, by lawful means, of lessening the hours of labor or increasing the wages, or bettering the condition of the members of such organizations, or lawfully carrying out their legitimate purposes. (C24, 27, 31, sec. 9916.) Sec. 9917. Liability. In case any person, company, partnership, corporation, or association, trust, pool, or combination of whatsoever name shall do, cause to be done, or permit to be done, any act, matter, or thing in section 9915 prohibited or declared to be unlawful, such person, partnership, company, association, corporation, trust, pool, or combination shall be liable to the person, partnership, company, association, or corporation injured thereby for the full amount of damages sustained in consequence of any such violation of the provisions of section 9915. (S13, sec. 5067-b; C24, 27, 31, sec. 9917.) Sec. 9918. Violation-Penalty.-Any person, partnership, company, association, or corporation subject to the provisions of sections 9915 to 9917, inclusive, or any person, trust, combination, pool, or association, or any director, officer, lessee, receiver, trustee, employee, clerk, agent, or any person acting for or employed by them, who shall violate any of the provisions of section 9915, or who shall aid and abet in such violation, shall be deemed guilty of a misdemeanor, and shall upon conviction thereof be fined any sum not less than five hundred dollars and not exceeding two thousand dollars or imprisoned in the county jail for a period not exceeding six months, or both, at the discretion of the court. (S13, sec. 5067-c; C24, 27, 31, sec. 9918.) Sec. 9919. Duty of grand jury. It shall be the duty of the grand jury to inquire into and ascertin if there exists any pool, trust, combination, or violation of any provision in section 9915, in their respective counties. (S13, sec. 5067-c; C24, 27, 31, sec. 9919.) Code (1939) Section 13162 provides in part that it is a crime to conspire to injure the business, property, or rights of another or to do any illegal act injurious to the public trade. Discriminations Sections 9885 to 9894 provide that it shall be unlawful for any person selling products or commercial services to discriminate as to price between different localities for the purpose of destroying the business of a competitor or creating a monopoly. Commercial services regulated by cities or town exempted from this act. See vol. State Price Control Legislation: Antidiscrimination Legislation. Judicial Decisions Application of the Common Law. An agreement was entered into between plaintiff, who was about to engage in the butter business, and all the grocers in town, whereby each of the latter, including defendant, agreed not to buy any butter from neighboring farmers (i. e. compete with plaintiff) for 2 years. Plaintiff promised to buy all butter offered by farmers at prices then prevailing in a neighboring town. The contract was held void as tending to monopolize the butter trade and destroy competition. Chaplin v. Brown, 83 Iowa 156, 48 N. W. 1074 (1891). However, in Marshalltown Stone Co. v. Des Moines Brick Mfg. Co., 114 Iowa 574, 87 N. W. 496 (1901), a contract to pay one who promised to decline a contract to furnish rock for paving a street at 25 cents per cubic yard provided the payee would not sell any crushed rock in Des Moines during the remainder of the year was held valid. The court stated that the contract was not a significant attempt to restrain competition in selling rock since many other competitors could supply the public demand. The contract was limited as to time, place, and commodity. Chaplin v. Brown, supra, was distinguished on the ground that all grocers in town entered into the agreement. See Contracts Not to Compete, infra. Constitutionality of Statutes. A prior statute identical with sections 9885 to 9887 except that it prohibited discrimination in dairy products, poultry, eggs, and grain rather than in all commodities was held constitutional in State v. Fairmont Creamery Co., 153 Iowa 702, 133 N. W. 895 (1911). This case, it seems, would be equally applicable to sections 9885 to 9887. Application of the Statutes. Applying section 5454 of McClain's Code which contained similar but narrower language than section 9906, insurance is a commodity and not a service within the meaning of the antitrust laws and an agreement to fix rates is invalid. Beechley v. Mulville, 102 Iowa 602, 70 N. W. 107 (1897). (Pet. for rehearing denied 71 N. W. 428.) For more recent antitrust regulation of insurance, see Special Antitrust Laws, infra. Medical service, however, is not a commodity within the meaning of section 9906 and a combination of physicians to fix fees cannot be prosecuted. The court stated: "It is manifest that the statute was not intended to, and did not include labor either skilled or unskilled." Rohlf v. Kasemeier, 140 Iowa 182, 118 N. W. 276 (1908). |