hence illegal price fixing and monopolistic practices are to be prevented and the Federal laws are to be supplemented to that end. The act further provides for injunctions against violations. If the injunction is disobeyed a receiver is to be appointed and if the defendant attempts to withdraw the copyrighted works from the State the court shall appoint a State antimonopoly board which shall fix the license rates for a year. Unless the copyright holder agrees to refrain from the monopolistic practices within this time the copyrights shall escheat to the State. See Vol. State Price Control Legislation: Antidiscrimination Legislation. Rev. Stat. Ann. (Remington 1932) Section 3898 provides that nonprofit corporations organized under sections 3888 to 3900 that shall engage in any business for gain or which shall enter into any agreement or combination in restraint of trade, or to fix the price of any commodity, or to limit or regulate the production or distribution of any commodity, or which shall attempt to restrain trade, or fix the price of any commodity, or limit or regulate the production or distribution of any commodity shall forfeit its rights to exist as a corporation and shall be dissolved. See Vol. Cooperatives in projected study. Dairy Products Section 6242 provides that combinations to fix the price at which dairy products shall be bought or sold are prohibited. See Vol. State Price Control Legislation: Antidiscrimination Legislation. Insurance Section 7076 prohibits insurance companies from entering into any combination or agreement with another insurance company for the purpose of controlling insurance rates, discriminating against any other company, or lessening free competition in the business. Commission Merchants Section 8299 (f) provides that the director of agriculture may decline to grant, or may revoke or suspend a license already granted to a commission merchant, after a hearing duly held as herein provided, where he is satisfied that the applicant or licensee has (5) participated in an illegal combination or combinations to fix prices. Section 8292-12 provides that the provisions of the act are not applicable to cooperative marketing associations. 210235°-40-vol. 1-55 Rev. Stat. Ann. (Remington, Supp. 1939) Section 7306-90 provides that no manufacturer or wholesaler or person financially interested directly or indirectly in such business, whether resident or nonresident, shall have any financial interest, direct or indirect, in any licensed retail business; nor own any of the property upon which such retail business is conducted; nor advance moneys or the equivalent under any arrangement whatsover; nor shall any retail licensee under any arrangement whatsoever conduct his business upon property in which any manufacturer or wholesaler has any interest nor receive any such advances of money. No manufacturer or wholesaler shall be eligible to receive or hold a retail license or sell at retail. Financial interest, direct or indirect, as used in this section, shall include any interest, whether by stock ownership, mortgage, lien, or through interlocking directors, or otherwise. Section 7306-91 provides that every person who violates any provision of this act or the regulations shall be guilty of a violation of this act, whether otherwise declared or not. Section 7306-93 provides that every person guilty of a violation of this act for which no penalty has been specifically provided shall be liable, on conviction, for a first offense to a penalty of not more than $300 or to imprisonment for not more than two months, with or without hard labor, or both; for a second offense, to imprisonment for not more than six months, with or without hard labor; and for a third or subsequent offense to imprisonment for not more than one year, with or without hard labor. If the offender convicted is a corporation, it shall for a first offense be liable to a penalty of not more than $2,000, and for a second or subsequent offense to a penalty of not more than $3,000, or to forfeiture of its corporate license, or both. 2. Public Contract Provisions Rev. Stat. Ann. (Remington, 1932) Section 2333-1 provides that when any competitive bids for work or improvements have been solicited by the State or any of its subdivisions it shall be unlawful for any person to offer or give anything of value to another person for the purpose of inducing such other person either to refrain from submitting any bids or to enter into any agreement or arrangement whereby full and unrestricted competition for the securing of such public work will be suppressed. The statute further provides that it shall be unlawful for any person to solicit or accept money or any other thing of value upon a promise that he will refrain from bidding upon such public work or that he will submit a bid in such sum as to eliminate full and unrestricted competition. Collusion in competitive bidding is unlawful. Sec. 2333-2. It is no defense to a prosecution under this act that any agreement to eliminate unrestricted competitive bids was made outside of the State if the work for which bids are called is to be done in the State. Sec. 2333-4. See projected Vol. Governmental Purchasing. Rev. Stat. Ann. (Remington, Supp., 1939) Road Equipment Section 6450-47 provides that in purchases of road equipment exceeding $500, on evidence of collusion between bidders, county commissioners may reject all bids. See projected MARKETING LAWS SURVEY volume Governmental Purchasing. Printing Section 10335 provides that all government printing work is to be done in the State except where bids are excessive and not reasonably competitive. No claims for printing done outside the State shall be allowed unless it shall be alleged and proved that such work could not be done in the State at reasonable and competitive rates. See projected Vol. Governmental Purchasing. 3. Anticoercive Financing Statutes No provisions. Railroads. Judicial Decisions In a petition for condemnation of a right-of-way by a carrier, it was argued that the petitioner railroad had violated art. XII, sec. 16 of the State constitution in that it had unlawfully consolidated with two other competing and parallel railroads. The court held, however, that according to the evidence the constituent corporations remained the same, each transacted its own business, made its own rates and transported freight and passengers over its own lines as before the consolidation. Each corporation remained separate and distinct from the other. The mere fact that each had subscribed stock in the consolidated corporation, was not a merger within the constitutional prohibition. State ex rel. Cascade Railroad Co. v. Superior Court, 51 Wash. 346, 98 Pac. 739 (1909). The legality of a consolidation and merger of utilities in violation of Const. art. XII, sec. 16 cannot be raised by a private litigant. Such question should be left to appropriate action by the State. Day v. Tacoma Ry. & Power Co., 80 Wash. 161, 141 Pac. 347 (1914). See also Wood v. Seattle, 23 Wash. 1, 62 Pac. 135 (1900). Commission Merchants. The validity of Rem. Rev. Stat. sec. 8301 (repealed by L. 1937, c. 67, sec. 12), a comprehensive statute for the regulation of commission merchants, was challenged on the ground that cooperative marketing associations were exempted. The court held that the exemption provided for in the act was based on a reasonable and valid classification, and that its provisions were not in violation of either the State or Federal Constitutions. Northern Cedar Co. v. French, 131 Wash. 394, 230. II. CONTRACTS NOT TO COMPETE No statutory provisions. Judicial Decisions Restrictive Covenants Ancillary to Sale of a Business. A contract by a vendor of a meat market not to engage in the same business in the same locality for 2 years was upheld. The court not only enjoined the defendant but his wife as well. The court would not permit the defendant to circumvent his covenant by conveying all of his property to his wife, thereby permitting her to establish a similar business at the same place in competition with the vendee. Injunction and damages were granted. Loutzenhiser v. Peck, 89 Wash. 435, 154 Pac. 814 (1916). See also Nelson v. Brassington, 64 Wash. 180, 116 Pac. 629 (1911). A contract by a manufacturer of laundry trays and other cement products not to reenter the same business in Washington or Oregon for 5 years was held valid. The court held that the restriction here was reasonably necessary for the protection of the vendee as the market for its product extended beyond the State line. Reasonableness as to time and place, said the court, depends on the nature of the business and circumstances of sale in each case. Washington Charcrete Co. v. Campbell et al., 72 Wash. 566, 131 Pac. 208 (1913). A covenant not to engage in the business of abstracting of titles in the county for 5 years was held enforceable. Lumbermans' Trust Co. v. Title Insurance etc. Co. of Tacoma, 248 Fed. 212 (C. C. A. 9th Defendant had sold his stock in a corporation to plaintiff and orally agreed not to engage in a competing mercantile business in Spokane. He subsequently established a competing business directly opposite the plaintiff's shop. The court held that a written contract need not be proven and that the sale of a business, at a fair market value, was sufficient consideration for an agreement not to compete. Johnson v. Schultz, 137 Wash. 584, 243 Pac. 644 (1926). See also Barash v. Robinson, 142 Wash. 118, 252 Pac. 680 (1927). Restrictive Covenants Ancillary to Employment. A covenant by an employee of a certified public accountant not to solicit or perform accounting or auditing for clients of the employer with whom he came in contact during the course of employment for a period of 3 years after termination of employment was held valid. Racine v. Bender, 141 Wash. 606, 252 Pac. 115 (1927). III. TYING CONTRACTS AND EXCLUSIVE DEALING Rev. Stat. Ann. (Remington, Supp., 1939) Section 2892 provides that a cooperative agricultural association organized under sections 2878 to 2909 may enter into contracts with its members requiring the members to sell all or part of their agricultural products of specified commodities exclusively to or through the association or any facilities to be created by the association, for any period not over 10 years. See Cooperatives in projected study. Rev. Stat. Ann. (Remington, Supp., 1939) Insurance Section 7131-16 provides that no domestic mutual insurance company shall enter into a management contract the effect of which would be to surrender the control and management of the company: Provided, however, That exclusive, general, or local agency contracts may be entered into with the approval of the insurance commissioner. Judicial Decisions Contracts between an association and its members requiring the latter to ship and sell all of their produce through the association are not invalid when there is no attempt to limit production or control |