ute, and provisions directed at the expedition of proceedings occasionally appear. Lengthy sections specifying procedure for hearings before a master enacted in Massachusetts in 1911,14 represent perhaps the most matured product of this state of preoccupation with adjective law, but in practice Massachusetts has shared New England's coolness toward antitrust proceedings.

EXEMPTIONS

Exemptions from antitrust provisions were the first products to be turned out in volume in the post-war period. Early State antitrust legislation attempting to favor farmers had been declared unconstitutional. An Illinois act failed because the exemption of farmers was held to be improper favoritism and the statute could not be upheld with the elimination of the exemption without restricting the freedom of the class the legislature indicated a clear intention to leave unmolested.15 Kentucky antitrust laws became involved with meaningless phrases about the real value of commodities and were declared unconstitutional by the United States Supreme Court when an examination of their construction by the Kentucky courts disclosed that they were construed so that farmers could do no wrong and industrial corporations were furnished no guide to the manner in which they might escape violation of the act.16 A Colorado antitrust statute was found unconstitutional because it exempted associations to conduct operations at a reasonable profit or to market at a reasonable profit products not otherwise marketable." The cooperative movement after the World War developed a successful technique of lawful statutory discrimination in favor of farmers. State legislatures hastened to adopt statutes containing lengthy recitals of public policy based upon further recitals of the farmers' inability to meet the buyers on equal terms without cooperation. Cooperatives were authorized to tie their members to exclusive dealing contracts covering long terms of years and extraordinary remedies were provided. Not only were such contracts made specifically enforceable, but legal pressure was frequently brought to bear on third parties as by penalizing a warehouseman who afforded facilities to contract breakers. By way of express exemptions from the antitrust laws, the statutes commonly contain apparently innocuous declarations that cooperatives are not illegal combinations or conspiracies and that they shall be free to control the output of their

"Ark. Dig. Stat. (Pope, 1937), secs. 9407-9432. Acts of 1905, No. 1, secs. 1-4. "Mass. Ann. Laws (1933), c. 93, sec. 2 (L. 1911, c. 503, secs. 1-4).

Connolly v. Union Sewer Pipe Co., 184 U. S. 540, 22 Sup. Ct. 431, 46 L. Ed. 679 (1902).

"Intl. Harvester Co. v. Comm. of Kentucky, 234 U. S. 216, 34 Sup. Ct. 853, 58 L. Ed. 1284 (1914).

"Cline v. Frink Dairy Co., 274 U. S. 445, 47 Sup. Ct. 681, 71 L. Ed. 1146 (1927).

members. The significant part of this movement is that under the shield of these statutes, which do not on their face necessarily authorize monopolization on a crop basis, such monopolization has sometimes proceeded with limitation of production and destruction of surpluses limited only by the economic power of the agricultural combinations, and cases of successful legal attack are wanting. Labor unions have been the second beneficiaries of widespread exemptions, but declarations that unions do not violate the act have not generally been held to mean that they cannot violate the act by unduly oppressive conduct. The policy of the State with reference to abuses of power by labor unions is thus not encompassed by innocuous exemptions from the antitrust laws.

ANTITRUST LAWS APPLICABLE TO PARTICULAR

KINDS OF BUSINESS

While legislatures have sought to exempt certain favored groups, other groups have been made the subject of special restrictive legislation. The most numerous special acts of this sort relate to railroads. The railroads were early of preponderant economic importance and in many States special favors granted them by way of inducement to extend their lines offered additional reason for subjecting them to special regulation. The exceptional number of nineteenth century statutes relating to the consolidation of railroads, frequently several in the same State, seems largely due to special pressures producing statutes framed in general form but designed to permit a single consolidation only. It is quite apparent that many legislatures were inclined to yield to "just one more" consolidation at a time.18 The more general statutes of this nature announce but one principle and that with almost innumerable minor variations-extended and feeder lines may consolidate, but parallel and competing lines may not.

Next frequent among the statutes touching railroads which come within the scope of this volume are those directed against pooling freights. A prohibition of this nature was enacted as early as 1873 in Iowa.19 These laws include enactments closely paralleling the Interstate Commerce Act of 1887 20 in that respect. Indeed, the Missouri

18 Illinois provides a good example of a multiplicity of consolidation statutes for railroads. None of the following statutes have been regarded as repealing the statutes preceding them in the list. Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 46 (L. 1875, p. 96 as amended by L. 1895, p. 293); Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 39 (L. 1883, p. 124); Ill. Rev. Stat. (Smith-Hurd), c. 114. sec. 165 (L. 1885, p. 229 as amended by L. 1925, p. 510); Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 42 (L. 1893, p. 166); Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 167 (L. 1897, p. 281); Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 170 (L. 1907, p. 473); Ill. Rev. Stat. (Smith-Hurd), c. 114, sec. 49c (L. 1929, p. 591).

19

Iowa Code (1935) sec. 8050 (Code of 1873, sec. 1297).

2024 Stat. 379 (1887) (49 U. S. C. A. (1929) secs. 1-27).

Legislature in extra session in 1887 forthwith enacted the substantial provisions of that statute, so far as applicable to State jurisdiction, including the section against pooling." The Washington Constitution of 1889 22 evidences the same concern. This found legislative expression in different States every few years until the Federal control of railroads was expanded in 1906.23

A policy against having railroads interested in other business has had several manifestations. The commodity clause of the Hepburn amendment of 1906 to the Interstate Commerce Act 24 was directed at the interest of common carriers in commodities transported by them. Like legislation occurred in Pennsylvania in 1907 25 and in Kansas in 1911, although the first might be regarded as merely implementing a constitutional prohibition, going back to 1874. As early as 1867, Ohio had limited the stock interest that railroads might hold in grain elevators,28 and in the last quarter of the century Tennessee specifically forbade any carrier to become a party to any combination to control cotton compressing, and West Virginia forbade railroads to trade in coal.30 In 1890 South Dakota evidenced concern of the legislature with agreements between railroad companies and a warehouseman to consign property to a warehouse without the consent of the owner,31 and the same practice was forbidden elsewhere, Wisconsin following suit as late as 1905.32 In the same year, while the discussion of railroad rebates in general, leading to Federal legislation of 1906 was rife, Nebraska passed a law against rebates in aid of local price-discrimination practices on the part of shippers.33 Missouri legislation addressed

29

Mo. Stat. Ann. (1932) c. 32, art. 2, sec. 4798, p. 2185 (L. 1887, ex. sess., p. 15, sec. 5). Wash. Const. art. XII, sec. 14.

By the Hepburn Amendment to the Interstate Commerce Act, 34 Stat. 584 (1906) (49 U. S. C. A. (1929) secs. 1 (1)-(9), 6, 11, 14, 15, 16, 16 (a), 18, 20, 41). "Same as 23, supra.

25 Directed at the officers and agents and not at the company, Pa. Stat. Ann. (Purdon, 1931), tit. 67, secs. 234, 235 (L. 1907, No. 359).

Kan. Gen. Stat. Ann. (Corrick, 1935) c. 66, art. 1, sec. 66-122 (L. 1911, c. 238, sec. 23).

27 Const. art. 17, sec. 5.

28

Ohio Code Ann. (Baldwin's Throckmorton, 1936) sec. 10173 (L. 1867, p. 86, sec. 4).

"Tenn. Code Ann. (Michie, 1938) secs. 5524-5526 (L. 1879, c. 160).

30

W. Va. Code Ann. (Michie and Sublett, 1937) sec. 3101 (Acts 1895, c. 16).

1 S. D. Comp. Laws (1929) sec. 9763 (L. 1890, c. 99, sec. 23).

Wis. Rev. Stat. (1937) sec. 126.37 (L. 1905, c. 19, sec. 37).

23 Neb. Comp. Stat. (1929) c. 59, art. 8, sec. 59-815 (L. 1905, c. 162, sec. 15). This section declares it unlawful to transport the property of corporations or combinations soliciting or receiving rebates. A reference to the illegality of transporting the property of any such corporation or combination indulging in local price discrimination is here assumed to cover only corporations and combinations guilty of the acts condemned in the last sentence. The section seems highly penal and should be strictly construed even though the second sentence then subtracts from the first rather than adds to it. No cases have been found on the point.

itself to the subject of interlocking officers of railroads as early as 1887.34

The Federal legislation affecting railroads in 1906 approximately marks the end of the period of State activity in that respect. The Interstate Commerce Commission assumed an increasing degree of control, and long before the Transportation Act of 1920 35 marked a reversal of Federal legislative policy which now favored a combination of railroads under administrative control, State legislatures had turned their attention almost exclusively to other fields. Statutes such as that of West Virginia in 1927 remitting the subject of the consolidation of parallel lines to administrative control 36 are merely of passing interest as evidencing the spirit of the times. The subject matter was no longer generally regarded as a matter of systematic State concern.

Several other statutes involving railroads which have not so far been described are included in the body of this compilation, but all the types commonly occurring have been here mentioned and there included, except those centering around the activities of railroad or public utility commissions and those setting forth the regulations to be enforced by such commissions. These statutes are outside the scope of this volume. Analytically, they seem to fall within the distinct field of public utility regulation. While antitrust laws necessarily touch public utilities and intersect the legal arrangements for administrative control, in themselves, they represent a simpler phase of real or attempted Government control over business. Enforced by criminal proceeding, injunction, or damage suit, they do not involve direct control of capital issues or price-fixing, which constitute two of the distinctive features of public utility regulation.

The compilation does include, however, a number of statutes of an antitrust nature affecting public utilities, but largely antedating extensive commission control. As early as Civil War days, Missouri forbade telegraph companies to obtain exclusive rights-of-way for their lines from landowners,37 and a prohibition in Ohio against the consolidation of parallel telegraph lines also came early.38 Ohio cities were denied authority to grant exclusive rights in streets to gas companies in 1868 39 and the express mention of telephone companies in that State

34 Mo. Stat. Ann. (1932) c. 32, art. 2, sec. 4692, p. 2101 (L. 1887, reg. sess., p. 103). This law was repealed in 1939 (L. 1939, p. 280, sec. 1).

3641 Stat. 474 (1920) (49 U. S. C. A. (1929) sec. 1).

36

W. Va. Code Ann. (Michie and Sublett, 1937) sec. 3107 (Offic. Code (1931) sec. 31-2-11).

37 Mo. Stat. Ann. (1932) c. 32, art. 6. sec. 4923, p. 2239 (G. S. 1865, p. 349, sec. 7, purporting to amend R. S. 1856, p. 152, sec. 7).

48).

Ohio Code Ann. (Baldwin's Throckmorton, 1936) sec. 9190 (50 v. 274, 288, sec.

* Ohio Code Ann. (Baldwin's Throckmorton, 1936) sec. 3989 (66 v. 219, sec.

goes back almost to the earliest days of the telephone.40 As in the case of railroads, legislation against specific practices, such as the South Dakota statute of 1911 against pooling messages," follows statutes against combinations.

43

Nebraska paid express attention to the consolidation of street railways as early as 1889,2 although the statute then enacted was in permissive form, and, as late as 1915, Texas took occasion to forbid the consolidation of competing interurban railways. The decline of electric railway transportation is reflected by such statutes as the Georgia Act of 1924 authorizing electric railways to acquire the securities of bus companies. As previously suggested, however, the bulk of the later statutes falls within the excluded field of public utility laws, only occasional instances being embodied in this collection by reason of more than usual affiliation with the antitrust laws. Several provisions affecting other public utilities have been included for one reason or another without any attempt to survey that field. They relate, not only to mergers, but to combinations through stockholders. Some prohibit transfer of franchises. Some relate to specific services, such as the hydroelectric industry or motor carriers, but as might be expected from a miscellaneous collection merely adhering, so to speak, to the general antitrust laws, they disclose no particular trend or other significant generalization. Such significance must be sought elsewhere.

Antitrust statutes appear in another field which has also been remitted in most part to administrative control-that of insurance. As early as 1887, Michigan required foreign insurance companies to enter into a bond conditioned that they refrain from combinations in restraint of competition.45 Missouri legislation of the nineties made special reference to fire, storm, and property damage insurance in connection with the general antitrust laws.46 Although regulations of a statutory nature relating to combinations, pooling, or other interferences with the competitive process have been strung out over a period of 50 years, the most activity in this field occurred during the 8 years following the insurance scandals of 1906-7. Virtually all kinds of insurance companies are covered by statutes of an antitrust nature in one State or another. Most of the statutes do not refer to all kinds of insurance. Concern with fire insurance and other in

Ohio Code Ann. (Baldwin's Throckmorton, 1936) sec. 9191 (R. S. 1880, sec. 3471).

S. D. Comp. Laws (1929) sec. 9511 (L. 1911, c. 207, sec. 9).

Neb. Comp. Stat. (1929) c. 74, art. 11, sec. 74-1106 (L. 1889, c. 38). "Tex. Stat. (Vernon, 1936) Civ. Code, art. 6543 (L. 1915, 1st called sess., c. 14. sec. 2).

L. 1924, p. 99 [Ga. Code Ann. (Park et al., 1937) title 94, sec. 94-1010]. Mich. Stat. Ann. (1937) secs. 24.99-24.101 (Mich. Pub. Acts 1887, No. 285). "Mo. Stat. Ann. (1932) c. 47, art. 3, sec. 8728, p. 6503 (L. 1895, p. 237, sec. 1).