Black, Donald F.

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Volume 39 Issue 4 Article 10 June 1933 Monopolies--Producers' Coal Sales Agency and the Sherman Act Donald F. Black West Virginia University College of Law Follow this and additional works at: https://researchrepository.wvu.edu/wvlr  Part of the Business Organizations Law Commons, Commercial Law Commons, and the Oil, Gas, and Mineral Law Commons Recommended Citation Donald F. Black, Monopolies--Producers' Coal Sales Agency and the Sherman Act, 39 W. Va. L. Rev. (1933). Available at: https://researchrepository.wvu.edu/wvlr/vol39/iss4/10 This Recent Case Comment is brought to you for free and open access by the WVU College of Law at The Research Repository @ WVU. It has been accepted for inclusion in West Virginia Law Review by an authorized editor of The Research Repository @ WVU. For more information, please contact ian.harmon@mail.wvu.edu. RECENT CASE COMMENTSposes of county taxes the county is the governmental unit. In thecase of state taxes the state is the governmental unit, but thecounty assessments are used as the basis on which such taxes arelevied. It is submitted that the rule of the principal case logical-ly bars discrimination in assessment for state taxation of prop-erty in different counties. Difficulties of proof, however, are sogreat as doubtless to explain why no application of the rule tosuch a situation has been found on record.-CHiARtS H. HADEN.MONOPOLIES - PRODUCERS' COAL SALES AGENCY AND THESHRmAN ACT. - Appalachian Coals Incorporated was organizedas the combined and sole selling agency of seventy-three per centof all the active coal producers in what is known as the Appal-achian Territory, lying in Virginia, West Virginia, Kentucky andTennessee. The purpose of the agency was to eliminate competi-tive sales and wasteful and undesirable sales practice between itsmembers. The government sought to enjoin its formation andoperation as being a combination in restraint of interstate com-merce and a monopoly in violation of sections one and two of theSherman Act.' The District Court granted the injunction.' TheSupreme Court of the United States, after full review of theevidence, found that substantial competition would exist in thecoal market even if the agency operated; that the organizationwould not reasonably restrain trade; and while retaining juris-diction in the event the agency in operation did restrain inter-state trade, reversed the district court. Appalachtian Coals Inc.v. United States.'In construing the Sherman Act the courts at first interpretedrestraint of trade as covering any scheme reducing competitionbetween independent concerns, whether economically justifiableor not.' In 1911 the Supreme Court judicially legislated into theact the rule of reason, taken from the common law on restraint oftrade The principal case demonstrates clearly the elasticity lentto the statute by judicially placing in it the rule of reason.'26 Stat. 209, 15 U. S. C. A. §§ 1, 2 (1926).21 Fed. Supp. 339 (1932).553 S. Ct. 471 (1933).' United States v. Freight Association, 166 U. S. 290, 17 S. Ct. 540 (1897);United States v. Joint Traffic Association, 171 U. S. 505, 19 S. Ct. 25 (1898).8Standard Oil Co. v. United States, 221 U. S. 1, 31 S. Ct. 502 (1911);United States v. American Tobacco Co., 221 U. S. 106, 31 S. Ct. 632 (1911).1Black: Monopolies--Producers' Coal Sales Agency and the Sherman ActDisseminated by The Research Repository @ WVU, 1933WEST VIRGINIA LAW QUARTERLYA little over twenty-five years ago the West Virginia SupremeCourt of Appeals declared a strikingly similar sales agency illegalas a combination in restraint of trade at common law.' ThusAppalachian Coals, for example, may, as to its intra-state busi-ness in West Virginia, be illegal, though the court might findthat to be reasonable today which was an unreasonable restraintof trade twenty-five years ago.In the principal case the court boldly assumed that the Sher-man Act, "has a generality and adaptability comparable to thatfound to be desirable in constitutional provisions." It is truethat constitutional provisions such as the due process clause havebeen invariably kept elastic and capable of absorbing the changingwill of the people as expressed through legislative enactment."But it is a rather remarkable doctrine that attributes a like elas-ticity to a criminal statute based upon one of the express powersof Congress. The decision is clearly in line with the government'spolicy as to other economic groups such as that of the farmer andno doubt the public will has to a large extent changed since theenactment of the Anti-Trust laws. But does the present extremityof the coal industry justify the court in reflecting a trend awayfrom the theory that rivalry is the life of trade in advance of legis-lative action?It has been objected that indefinite language, especially in acriminal statute, is in effect a delegation of legislative power tothe court and thus unconstitutional.8 A further objection is thatindefiniteness violates the due process clause of the Constitutionbecause it does not give the citizen a fixed guide by which he canreasonably ascertain when he is acting criminally.! Has not theCouit by the present application of the rule of reason read suchuncertainty into a criminal statute as to give us a piece of uncon-stitutional judicial legislation?'-DONALD F. BL.cK.OPocahontas Coke Co. v. Powhatan Coal and Coke Co., 60 W. Va. 508,56 S. E. 264 (1906). See also Slaughter v. Thatcher Coal & Coke Co., 55W. Va. 642, 47 S. E. 247 (1904).7CUTHBERT W. POUND AND AssociATEs, THE GROWTH op AmERicAN AD-MINISTRATIVE LAW (1923) 100, 115.8 Aigler, Legislation in Yague Terms (1923) 21 MicH. L. REV. 831.1 Freund, The Use of Indefinite Terms in Statutes (1921) 30 YALE L. J. 437."Fall v. Sutter County, 21 Cal. 237 (1862) ; cited with approval in Hodgesv. Public Service Commission, 110 W. Va. 649, 159 S. E. 834 (1931).2West Virginia Law Review, Vol. 39, Iss. 4 [1933], Art. 10https://researchrepository.wvu.edu/wvlr/vol39/iss4/10

Monopolies--Producers\u27 Coal Sales Agency and the Sherman Act

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Monopolies--Producers\u27 Coal Sales Agency and the Sherman Act

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