shall be guilty of contempt of court, and may be fined not exceeding one hundred dollars, and may be attached and imprisoned in jail until he makes a full statement of all the facts within his knowledge with reference to the matter inquired about. Any person who shall testify before any judge or justice as provided for in this chapter, or who shall testify as a witness for the State in the course of any statutory proceeding to secure testimony for the enforcement of this law, or in the course of any judicial proceeding to enforce the provisions of this chapter, shall not be subject to indictment or prosecution for any transaction, matter or thing concerning which he shall so give evidence documentary or otherwise.

Art. 1637. Agreement to form trust, monopoly, etc.-If any person shall enter into an agreement or understanding of any character to form a trust, or to form a monopoly, or to form a conspiracy in restraint of trade, as these offenses are defined in this chapter, or shall form a trust, monopoly, or conspiracy in restraint of trade, or shall be a party to the formation of a trust or monopoly or conspiracy in restrain of trade, or shall become a party to a trust or monopoly or conspiracy in restraint of trade, or shall do any act in furtherance of or aid to such trust or monopoly or conspiracy in restraint of trade, he shall be confined in the penitentiary not less than two or more than ten years. (Acts 1907, p. 457.)

Art. 1638. Operating in violation of this law. If any person shall, as a member, agent, employee, officer, director, or stockholder of any business, firm, corporation, or association of persons, form in violation of the provisions of this chapter, or shall operate, in violation of such provisions, any such business, firm, corporation, or association formed in violation of this chapter, or shall make any sale, or purchase, or any other contract, or do business for such business, firm, corporation, or association, or shall do any other act which has the effect of violating or aiding in the violation of any provision of this chapter, or shall, with the intent or purpose of driving out competition or for the purpose of financially injuring competitors, sell within this State at less than cost of manufacture or production, or sell in such a way or give away within this State, products for the purpose of driving out competition or financially injuring competitors engaged in a similar business, or give secret rebates on such purchase for the purpose of the aforesaid, he shall be confined in the penitentiary not less than two nor more than ten years. Id.

Art. 1639. Persons outside State liable.-If any person shall, outside of this State, do anything which, if done within this State, would constitute the formation of a trust or monopoly or conspiracy in the restraint of trade, as defined in this chapter, and shall

cause or permit the trust or monopoly so formed by him to do business within this State, or shall cause or permit such trust, monopoly, or conspiracy in restraint of trade to have any operation or effect within this State, or, if such trust, monopoly, or conspiracy in restraint of trade, having been formed outside of said State, any person shall give effect to such trust, monopoly, or conspiracy in this State, or he shall do anything to help or aid it doing business in this State, or otherwise violate the antitrust laws of this State, or if any person shall buy or sell or otherwise make contracts for or aid any business, firm, corporation, or association of persons, formed or operated in violation of any provision of this chapter, or so formed or operated as would be in violation of the laws of this State, if it had been formed within this State, shall be confined in the penitentiary not less than two nor more than ten years. Id.

Art. 1640. Forming trusts, etc.-If any person, employe, agent, stockholder, or officer of any person, firm, association of persons, or corporation, now doing business in this State, have formed a trust, or monopoly, as defined in this chapter, or have formed a conspiracy in restraint of trade, as defined in this chapter, or shall do or perform any act of any character to carry out such trust, monopoly, or conspiracy in restraint of trade, such person, employe, agent, stockholder, or officer shall be confined in the penitentiary not less than two nor more than ten years. (Acts 1907, p. 458.)

Art. 1641. Venue.-Prosecutions under this chapter may be conducted in Travis County, or in any county wherein a trust, monopoly. or conspiracy in restraint of trade is being carried on. (Acts 1907, p. 458.)

Art. 1642. Agricultural products and livestock exempt.-No provision of this law shall apply to agricultural products or livestock while in the hands of the producer or raiser. It shall be lawful for any person engaged in any kind of work or labor, manual or mental, or both, to associate with other such persons to form trades unions and other organizations for the purpose of protecting themselves in their personal work, personal labor, and personal service, in their respective pursuits and employments. (Acts 1899, p. 262.)

Art. 1643. Trade unions, etc. It shall be lawful for any members of such trades union or other organization or association, or any other person, to induce or attempt to induce, by peaceable and lawful means, any person to accept any particular employment, or quit any particular employment in which such person may then be engaged, or to enter any pursuit, or refuse to enter any pursuit, or quit any pursuit, in which such person may then be engaged. No such member shall have the right to trespass upon the premises of another without the consent of the owner thereof. Id.

Art. 1644. Not to apply to combination, etc.-The foregoing article shall not be held to apply to any combination or combinations, association or associations of capital, or capital and persons, natural or artificial, formed for the purpose of limiting the production or consumption of labor's products, or for any other purpose in restraint of trade. Nothing herein contained shall be held to interfere with the terms and conditions of private contract with regard to the time of service, or other stipulations between employers and employes. Nothing herein shall be construed to repeal, affect, or diminish the force and effect of any statute now existing on the subject of trusts, conspiracies against trade, pools, and monopolies. Id.

Stat. (Vernon, 1936)

Art. 1302. Purposes.-The purposes for which private corporations may be formed are:

50. To subscribe for, purchase, invest in, hold, own, assign, pledge, and otherwise deal in and dispose of shares of capital stock, bonds, mortgages, debentures, notes and other securities, obligations, contracts, and evidences of indebtedness of foreign or domestic corporations not competing with each other in the same line of business; provided the powers and authority herein conferred shall in no way affect any provision of the antitrust laws of this State. (Acts 1921, p. 265.)

Art. 1372. Law violations. Whenever any domestic or foreign corporation in this State shall violate any law of this State, including the law against trusts, monopolies, and conspiracies or combinations or contracts in restraint of trade, for the violation of which fines or penalties or forfeitures are provided, all property of such corporation within this State at the time of such violation, or which may thereafter come within this State, shall by reason of such violation, become liable for such fines or penalties and for costs of suit and costs of collection. (Acts 1907, p. 175.)

Art. 1531. Affidavit.-Before a permit is issued to such corporation, its president, vice president, secretary, or treasurer, or two of the directors thereof, shall make and file in the office of the Secretary of State an affidavit stating that such corporation is not a trust or organization in restraint of trade in violation of the laws of this State, has not, within twelve months next preceding the making of such affidavit, become or been a party to any trust agreement of any kind which would constitute a violation of any antitrust law of Texas existing at the date of such affidavit, and has not within that time, entered into or been in any wise a party to, any combination in restraint of trade within the United States, and that no officer of

such corporation has, within the knowledge of affiant, within such time and on behalf of such corporation or for its benefit, made any such contract, or entered into or become a party to any such combination in restraint of trade. The jurat of the officer making such affidavit shall be attested by his official signature and seal of office. (Acts 1909, C. S., p. 267; id.)2

Judicial Decisions

Application of the Common Law.

The common law doctrine against monopolies and restraint of trade was incorporated in the first Texas Constitution of 1845 by provisions enacted to the effect that monopolies and grants in perpetuity shall never be permitted. There were no general antitrust cases prior to the enactment of the Antitrust Act in 1889, and since then most cases turned on provisions contained in the constitution and statutes. However, for application of common law doctrines see Contracts not to Compete, infra.

In a case, decided after the act of 1889, but involving an agreement made prior to the act, the plaintiff, a butcher, contended that a firm of cattle dealers had induced another firm to refrain from dealing with him, thereby forcing him to make purchases out of the city. The court held that at common law, a seller may refuse to sell to whomever he pleases, but may not combine and conspire with others to do so to the injury of another. Such combinations were actionable at common law. Delz v. Winfree, 80 Tex. 400, 16 S. W. 111 (1891). See also North Texas Gin. Co. v. Thomas, 277 S. W. 438 (Civ. App. 1925).

Constitutionality of Statutes.

The first general Antitrust Act was passed in 1889 (L. 1889, c. 117, 141). Its validity was questioned in a suit to restrain a combination of fire-insurance companies from fixing insurance rates and agents' commissions, on the ground that the statute violated the "equal protection" clause of the fourteenth amendment to the Federal Constitution, since it exempted agricultural and livestock products while în the hands of the producer. The district court and court of civil appeals denied defendants' contentions, and held for the State. The decision. however, was reversed by the Supreme Court of Texas not on the above ground, but on the ground that the act was inapplicable

'Art. 1531 is a part of the Foreign Corporation Law, arts. 1529 to 1538.

to the business of insurance, and that, otherwise, the act was valid. Queen Insurance Co. v. State, 22 S. W. 1048; 24 S. W. 397 (Civ. App. 1893). See also Anheuser-Busch Brewing Ass'n & Houck, 27 S. W. 692 (Civ. App. 1894), aff'd., 88 Tex. 184, 30 S. W. 869 (1895), where the court held the act constitutional, despite the exemptions.

The act of 1889 was amended in 1895 (L. 1895, c. 83, p. 112), but the exemptions to agricultural and livestock products were retained. Its validity was again challenged on the same ground, but the contention was overruled. Texas Brewing Co. v. Anderson, 40 S. W. 737 (Civ. App. 1898).

The act of 1895 was also challenged on the ground that it violated the Bill of Rights of the State Constitution, which provided that "no citizen of this State be deprived of life, liberty, property, or immunities, or in any manner disfranchised, except by the due course of the law of the land." This contention was likewise overruled on authority of the Anderson case, supra. Texas Brewing Co. v. Durrum, 46 S. W. 880 (Civ. App. 1898).

Both the 1889 and 1895 acts were then attacked as invalid, in a suit to cancel a corporation's permit to do business in the state, on the ground that defendants were deprived of their property and contract rights "without due process of law" in violation of the fourteenth amendment to the Federal Constitution, and also on the ground that the acts constituted class legislation. The acts, however, were upheld as a valid exercise of the State's police power. Waters-Pierce Oil Co. v. State, 19 Civ. App. 1, 44 S. W. 936 (1898). The decision was affirmed by the Supreme Court of the United States, but on a different ground, holding that the constitutional questions were not before the court. (Id., 177 U. S. 28, 20 Sup. Ct. 518, 44 L. Ed. 657 (1900).)

In 1902 the Supreme Court of the United States decided the case of Connolly v. Union Sewer Pipe Co. 184 U. S. 540 (1902), involving the Antitrust Act of Illinois, which contained similar exemptions. In an action to collect the purchase price for pipes sold, the defendant argued that the plaintiff could not recover on the ground that it was a member of an illegal combination. The Supreme Court held the entire Illinois Antitrust Act unconstitutional, on the ground that the exemptions to agricultural and livestock products constituted class legislation, in violation of the "equal protection" clause of the Federal Constitution.

Following the Connolly decision, the State court of civil appeals, in a suit to recover penalties for violation of the antitrust laws, held the Antitrust Acts unconstitutional. State v. Waters-Pierce Oil Co. 67 S. W. 1057 (1902). But, in another case, the Supreme Court of