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The Anti-Trust Act of July 2, 1890, c. 647, 26 Stat. 209, prohibits any combination whatever to secure action which essentially obstructs the free flow of commerce between the States, or restricts, in that regard, the liberty of a trader to engage in business.
Plaintiffs Loewe & Company manufactured fur hats in Connecticut and sold them in various states. Defendants, Lawlor and other members of the United Hatters of North America, boycotted plaintiffs because they refused to unionize and engaged in a campaign to keep others from purchasing plaintiffs product. Loewe sued the Union, alleging that the boycott interfered with the fur manufacturers ability to engae in interstate commerce. The manufacturer sought treble damages under the Anti-Trust Act of July 2, 1890, c. 647, 26 Stat. 209. The lower court sustained defendants' demurrer on the grounds that the combination stated was not within the Sherman Act. The fur manufacturer appealed to the Court of Appeals for the Second Circuit, which certified the question to the United States Supreme Court.
Did the actions of the hatters' unions constitute an unlawful combination within the scope of the Sherman Act?
The United States Supreme Court reversed and remanded the lower court decision, finding plaintiffs' complaint properly alleged a combination in restraint of trade or commerce under the Act. The court found the statute, so far as it related to the sort of combinations to which it was to apply, included combinations which were composed of laborers acting in the interest of laborers. The court held the fact that defendants were members of a labor union seeking to force plaintiff to unionize did not serve to take defendants out of the reach of the Act.