A combination of wholesale and retail dealers in food products to control prices and prevent others who were not members of the combination from purchasing said products, was held to be a criminal conspiracy. Denver Jobbers' Ass'n v. Peoples ex rel Dickson, Att'y Gen., 21 Colo. App. 326, 122 Pac. 404 (1912). Refusal of members of an association of builders and contractors in Denver to bid on a building job if other nonmembers' bids were received held not an illegal restraint. Since it appeared that the association had only 15 members as against more than 50 nonmember builders and contractors in the city no coercion or intimidation was shown. Masters Builders' Ass'n v. Domascio, 16 Colo., App. 25, 63 Pac. 782 (1901). The general manager of a corporation, who took possession of a mill leased by him to the corporation, cannot interpose, as a defense to the corporation's action to quiet title, the illegality of the corporation. Buckhorn Plaster Co. v. Consolidated Plaster Co., 47 Colo 516, 108 Pac. 27 (1910). Constitutionality of Statutes. The Colorado antitrust law was held unconstitutional in Cline v. Frink Dairy Company, 9 Fed. (2d) 176, aff'd., 274 U. S. 445 (1927), on the ground that it violated the due-process clause of the Federal Constitution. The "reasonable profit" provisos were condemned as setting too uncertain a standard of legality. The court said: These provisos make the line between lawfulness and criminality to depend upon first, what commodities need to be handled according to the trust methods condemned in the first part of the act to enable those engaged in dealing in them to secure a reasonable profit therefrom; second, to determine what generally would be a reasonable profit for such a business; and third, what would be a reasonable profit for the defendant under the circumstances of his particular business. The lower court, however, had proceeded on the theory that the act was in violation of the equal-protection clause since the exemption of agricultural cooperatives from its provisions established an unreasonable classification. Application of Statutes. The following cases were decided before the antitrust law was held unconstitutional in the Cline case, supra. It was held that contracts involving labor were not exempt from the provisions of subdivision 1 of Stat. Ann. (Michie, 1935), c. 167 (L. 1913, c. 161), and if their "obvious and natural tendency" was to achieve a monopoly, they were illegal under the act. An agreement by a master plumbers association and a local union that the former would employ only members of latter and the latter would work only for the former is illegal. The tendency is to create a monopoly in the business of plumbing. Though labor is not a "commodity" within the pricecontrol provision of the antitrust law (L. 1913, c. 161), a combination which controls a certain type of labor, in effect, controls the price of the commodity on which the labor is to be used and is unlawful under the act. Campbell v. People, 72 Colo. 213, 210 Pac. 841 (1922); Johnson v. People, 72 Colo. 218, 210 Pac. 843 (1922). An indictment under Stat. Ann. (Michie, 1935), c. 167 (L. 1913, c. 161), need not contain allegations negativing the provisos of the Act. People v. Apostolos, 73 Colo. 71, 213 Pac. 331 (1923). B. EXCEPTIONS TO GENERAL ANTITRUST LAWS Stat. Ann. (Michie, Supp. 1938), c. 165 Resale Price Maintenance Section 20, subsections (1) to (5), permit contracts fixing the resale price of branded commodities. The act is expressly inapplicable to horizontal agreements between producers, between wholesalers, or between retailers. See Vol., State Price Control Legislation. Stat. Ann. (Michie, 1935), c. 106 Section 42 provides that no agricultural cooperative marketing association organized under sections 14 to 45 shall be deemed to be a conspiracy or combination in restraint of trade, an illegal monopoly, or an attempt to lessen competition or fix prices arbitrarily. See Tying Contracts and Exclusive Dealing Arangements, infra. See also Cooperatives in projected study. Cooperatives. Judicial Decisions Application of Common Law. See Denver Jobbers' Ass'n. v. People ex rel. Dickson, supra; Burns v. Wray Farmers' Grain Co., supra; Atkinson v. Colorado Wheat Growers' Association, supra. Constitutionality of Statute. The Colorado Cooperative Marketing Act (Stat. Ann. (Michie, 1935), c. 106 (L. 1923, c. 142)) is constitutional. The exemption of "agricultural products" combinations cannot be said to be an arbitrary or unreasonable classification. Rifle Potato Growers Cooperative Association v. Smith, 78 Colo. 171, 240 Pac. 937 (1925). Application of Statute. The act legalizes the type of contract involved in the Burns v. Wray case, supra. Rifle Potato Growers Cooperative Association v. Smith, 78 Colo. 171, 240 Pac. 937 (1925). The contract, to be valid, must be: (1) entered into after the act was passed; (2) authorized by the act and executed in compliance therewith; (3) made by and between an association formed under the act, and a member of such association. Thus, where a contract was entered into after 1923, but before the corporation was organized as an association pursuant to sec. 40, Stat. Ann. (Michie, 1935), c. 106, the contract is invalid. Contracts "heretofore made" under sec. 32 (c) Stat. Ann. (Michie, 1935), c. 106, are contracts made prior to the passage of the act, and therefore invalid. Colorado Wheat Growers' Ass'n. v. Thede, 80 Colo. 529, 253 Pac. 30 (1927). The act (Stat. Ann. (Michie, 1935), c. 106, secs. 40 and 40 (a)) cannot be applied retroactively. Atkinson v. Colorado Wheat Growers' Association, 77 Colo. 559 Pac. 1117 (1925). Stat. Ann (Michie, 1935), c. 106, sec. 41, insofar as it imposes civil liability was applied and sustained in Fort v. Cooperative Farmers' Exchange, Inc., 81 Colo. 431, 256 Pac. 319 (1927). It was held that an injunction would lie restraining defendant from inducing breach of plaintiff's marketing contract, whether or not the acts complained of were criminal. Persons, whether members of the association or not, conspiring to defeat objective of marketing contracts are equally liable for all damages sustained by the association. Stat. Ann. (Michie, 1935), c. 106, sec. 32 (c) Monte Vista Potato Growers' Co-op. Ass'n. v. Bond, 80 Colo. 516, 252 Pac. 813 (1927). Under Stat. Ann (Michie, 1935), c. 106, sec. 32 (c) (L. 1923, sec. 19 (c)) a tenant taking a lease from an association member, with knowledge of his lessor's marketing contract, can be enjoined by the association from making disposition of his crops in a manner not provided. He is charged with knowledge of the statutory provisions relative to marketing contracts and is liable for all damages incurred because of such violation. Wilson v. Monte Vista Potato Growers' Ass'n., 82 Colo. 428, 260 Pac. 1080 (1927). C. SPECIAL ANTITRUST LAWS 1. Special Industry Antitrust Acts CONSTITUTIONAL PROVISIONS Railroads Const. art. XV, sec. 5, provides that no railroad corporation shall consolidate its stock, property, or franchises with any other railroad corporation owning or controlling a parallel or competing line. Telegraph Companies Const. art. XV, sec. 13, provides that no telegraph company shall consolidate with, control, or purchase any other competing telegraph line and company. STATUTORY PROVISIONS Sections 7 and 13 provide that no railroad shall consolidate with, lease, purchase, or sell a competing or parallel line. Stat. Ann. (Michie, 1935), c. 41 Railroads and Telegraph Companies Section 57 provides that no railroad or telegraph company may consolidate its stock, property, or franchise with any other railroad or telegraph company having under its control a parallel or competing line of railroad or telegraph. Stat. Ann. (Michie, 1935), c. 69 Sections 41 to 46 provide that destruction of food, whether unripe or not, grown for human or animal consumption, by any person, firm, or corporation for the purpose of fixing or increasing the price thereof, limiting or diminishing the quantity thereof, establishing and maintaining a monopoly in such articles or products, or restraining trade therein in any manner, is unlawful. Proof of voluntary destruction of such food, unexplained, is prima facie violation of the act. The penalty for violation is a fine or imprisonment from 30 days to 1 year, or both. Stat. Ann. (Michie, 1935), c. 89 Section 28 provides that it shall be unlawful (1) for any manufacturer, wholesaler, or any other person interested financially in or with any of the above licensees, to be interested financially, directly or indirectly, in the business of any retail licensee, and vice versa; (2) for the above licensees in any manner to furnish, supply, or loan, directly or indirectly, to any retail licensee any financial assistance, or any equipment, fixtures, except exterior signs, chattels, decorations, or furnishings used in the storing, handling, or serving of food or alcoholic beverages within the premises, or for making any structural alterations or improvements in or on the building on which such premises are located; (3) for any retail licensee to receive and obtain from the above licensees, directly or indirectly, any of the above aid or materials; (4) for any person directly or indirectly interested in any retail liquor establishment or license to conduct, own, either in whole or in part, or be directly or indirectly interested in any other such establishment or license; (5) for any person or corporate licensee or stockholder thereof, to be a stockholder or interested, directly or indirectly, in any company of any kind whatsoever which shall make, own, or be interested, directly or indirectly, in any loan to any licensee. Any transaction, agreement, or arrangement prohibited by the above provisions shall be unlawful, illegal, and void, and any obligation arising therefrom shall be unenforceable in any court of this state by or against any of the parties involved. The purpose of these provisions is to prohibit and prevent the control of retail outlets for the sale of alcoholic beverages by any person other than the retail licensee. Section 41 provides that any person violating any of the provisions of this act, or any other rules and regulations pursuant thereto, shall be deemed guilty of a misdemeanor and upon conviction shall be fined not more than $5,000 for each offense, or may be punished by confinement in the county jail for not more than 1 year, or both. The court trying such offense may decree that the present license be revoked and that no license shall thereafter be issued to the person convicted of such violation. These penalties shall be construed to be in addition to any and all other penalties. Section 7 provides that it shall be unlawful (1) for any manufacturer, wholesaler, or any person financially interested in or with any such licensees, to be interested financially, directly or indirectly, in the business of any retail licensee, and vice versa; (2) for them to furnish, supply, or loan, in any manner, directly or indirectly, to any retail licensee, any financial assistance, or any equipment, fixtures, except exterior signs, chattels, decorations, or furnishings used in the storing, handling, or serving of food or fermented malt beverages within the premises or for making any structural alterations or improvements in or on the building on which such premises are located; (3) for any retail licensee in any way to receive and obtain such assistance, etc.; (4) for any person or corporation holding any |