United Leather Workers International Union, Local Lodge or Union No. 66 v. Herkert & Meisel Trunk Co.

delivered the opinion of the Court.

This suit was begun by a bill in equity filed in the District Court for the Eastern District of Missouri by the Herkert & Meisel Trunk Company and four others, all corporations of Missouri, engaged in making trunks and leather goods in St. Louis, against the United Leather Workers Union, Local Lodge or Union No. 66, an unincorporated association, its officers and agents and a number of its members. The bill averred that each of the complainants had built up a valuable business in making, selling and shipping in interstate commerce trunks and leather goods, that each received large quantities of raw material by interstate commerce, and employed a large

The evidence adduced before the District Court showed that the defendant, the Local Union No. 66 of the United Leather Workers, having declared a strike against the complainants and withdrawn its members from their employ, instituted an illegal picketing campaign of intimidation against their employees who were willing to remain and against others willing to take the places of the striking employees, that the effect of this campaign was to prevent the complainants from continuing to manufacture their goods needed to fill the orders they had received from regular customers and would-be purchasers in other States, that such orders covered ninety per cent, of all goods manufactured by complainants, that the character of their business was known to the defendants, and that the illegal strike campaign of defendants thus interfered with and obstructed complainants’ interstate commerce business to their great loss. There was no evidence whatever to show that complainants were obstructed by the strike or the strikers in shipping to other States the products they had ready to ship or in their receipt of materials from other States needed to make their goods. While the bill averred that defendants had instituted a boycott against complainants and were prosecuting the same by illegal methods, there was no evidence whatever that any attempt was made to boycott the sale of the complainants’ products in other States or anywhere or to interfere with their interstate shipments of goods ready to ship.

We think that this question has already been answered in the negative by this Court. In United Mine Workers v. Coronado Co., 259 U. S. 344 , a coal mining company in Arkansas changed its arrangement' with its employees from a closed shop to an open shop. The local union resented the change and the avowed purpose of the company to protect non-union employees by armed guards. Violence, murder and arson were resorted to by the union. Seventy-five per cent, of the output of the mine was to be shipped out of the State and a car of coal prepared for interstate shipment was destroyed by the mob of strikers and their sympathizers. It was contended that, as the result of the conspiracy was to reduce the interstate shipment of coal from the mines by 5,000 tons or more a week, this conspiracy was directed against interstate commerce, and triple damages for the injury inflicted could be recovered under the Federal Anti-Trust Law. But this Court held otherwise and reversed a judgment for a large'amount on the ground that the evidence did not disclose a conspiracy against interstate commerce, justifying recovery under the law. The language of the Court was (p. 407):

“ Coal mining is not interstate commerce, and the power of Congress does not extend to its regulation as such. In Hammer v. Dagenhart, 247 U. S. 251 , 272, we said: ‘The making of goods and the mining of coal are not commerce, nor does the fact that these things are to be afterwards shipped or used in interstate commerce, make their production a part thereof. Delaware, Lackawanna & Western R. R. Co. v. Yurkonis, 238 U. S. 439 .’ Obstruction to coal mining is not a direct obstruction to interstate commerce in coal, although, it, of course, may affect it by reducing the amount of coal to be carried in that commerce.” The same rule was followed in Gable v. Vonnegut Machinery Co., 274 Fed. 66 , 73, 74.

The same general principles are affirmed in Heisler v. Thomas Colliery Co., 260 U. S. 245 , 259; Crescent Oil Co. v. Mississippi, 257 U. S. 129 , 136; Arkadelphia Milling Co. v. St. Louis S. W. Ry. Co., 249 U. S. 134 , 151; McCluskey v. Marysville Ry. Co., 243 U. S. 36 , 38; Diamond Glue Co. v. U. S. Glue Co., 187 U. S. 611 , 616; Capital City Dairy Co. v. Ohio, 183 U. S. 238 , 245; United States v. E. C. Knight Co., 156 U. S. 1 , 12, 13; Kidd v. Pearson, 128 U. S. 1 , 20, 21; Coe v. Errol, 116 U. S. 517 , 528.

The Circuit Court of Appeals seems first to have based its conclusion on cases like Rearick v. Pennsylvania, 203 U. S. 507 ; Caldwell v. North Carolina, 187 U. S. 622 ; Brennan v. Titusville, 153 U. S. 289 ; and Robbins v. Shelby Taxing District, 120 U. S. 489 , 497. These dealt directly with the sale of goods in interstate commerce. They were cases of state taxation upon the solicitation and acceptance of orders of goods to be sent from one State to another. The subject matter taxed was contracts of sale proposed or made for deliveries of goods in interstate commerce. It is a far cry from such cases to a strike to induce the employers to make better terms with their employees when no interference with the transportation or

The Circuit Court of Appeals found further justification for its conclusion in cases like Eureka Pipe Line Co. v. Hallanan, 257 U. S. 265 , United Fuel Gas Co. v. Hallanan, 257 U. S. 277 , Dahnke-Walker Milling Co. v. Bondurant, 257 U. S. 282 , and Lemke v. Farmers Grain Co., 258 U. S. 50 . They present the practical conception of interstate commerce elaborated in Swift & Co. v. United States, 196 U. S. 375 , hereafter to be discussed, as a flowing stream created by a course of business to be protected against State invasion, but it must be a real and direct invasion and not something incidental or remote. Thus in the Pipe Line Company and Gas Company Cases, the State of West Virginia sought to tax-a stream of oil and gas flowing constantly through the State and out of it. It was held that the mere power of those who directed the stream to divert it from interstate commerce when as a course of business it was constantly interstate with only incidental and minor diversions to intrastate commerce, did not expose to the taxing power of the State that part of the flow which crossed state lines. The burden and invasion of interstate commerce was direct. In the Bon-durant Case, a Tennessee Milling Company bought a crop of grain in Kentucky, to be delivered on board the cars in Kentucky for shipment to Tennessee in accord with a course of business between the parties. It was held that an effort by the State of Kentucky to require a license of the Tennessee Company before it could buy and ship grain from Kentucky to Tennessee was a burden on, and invasion of, interstate commerce even though the Milling. Company might have stopped the grain in Kentucky contrary to the usual course.

In Lemke v. Farmers Grain Co., a state law of North Dakota subjected the purchase price of all grain flowing in a regular course of business from that State to the

None of these cases, although they all illustrate the practical conception of interstate commerce as a flowing stream from one State to another formed by a regular course of business, can properly be said to support the argument that mere intentional cutting down of manufacture or production is a direct restraint of commerce in the product intended to be shipped when ready, or to be any departure from the general rule last announced in the Coronado Case and uniformly applied in all the cases referred to above, which it followed. The effect upon interstate commerce in the four cases just cited on the other hand was directly burdensome and restraining.

Then the Circuit Court of Appeals found sustaining precedent in Swift & Co. v. United States, 196 U. S. 375 . In nat case the defendants were charged with a conspiracy to monopolize interstate commerce in cattle, step by step from the purchase of them on the western plains, in the transportation of them by the railroads through to the stockyards at Chicago, their sale and distribution there, their slaughter and preparation as meats in the packing houses of that city and their distribution and sale in the East. This Court held that such a conspiracy was a violation of the Federal Anti-Trust Law because it was an intended obstruction to the flow of interstate commerce which Congress in the Anti-Trust Law intended to keep free and untrammeled. It held that the intent to monopolize and restrain the stream of interstate commerce

The case of the Addyston Pipe Co. v. United States, 176 U. S. 211 , was an agreement between those who made and sold iron pipe in different States to fix prices as between themselves and not sell and deliver pipe from their foundries across state lines in competition with each other. Their intent and ability to control prices and prevent the public from having the benefit of competition in interstate trade brought them within the Federal AntiTrust Act.

So in the case of Montague & Co. v. Lowry, 193 U. S. 38 , manufacturers in eastern States of tiles and grates agreed with manufacturers and dealers in California not to sell tiles and grates to local dealers who would not agree to keep up prices. The intent to control commerce between the eastern States and local dealers in California, and thus to maintain prices, was held to constitute a conspiracy in restraint of interstate commerce.

On the'other hand, Hopkins v. United States, 171 U. S. 578 , Anderson v. United States, 171 U. S. 604 , and United States v. E. C. Knight Co., 156 U. S. 1 , were held not to come within the Federal Anti-Trust Law because the facts of those cases were not thought to reveal the probably effective intent directly to compass the restraint on interstate commerce.

The Knight Case has been looked upon by many as qualified by subsequent decisions of this Court. The case is to be sustained only by the view that there was no proof of steps to be taken with intent to monopolize or restrain interstate commerce in sugar, but only proof of the acquisition of stock in sugar manufacturing companies to

In Loewe v. Lawlor, 208 U. S. 274 , and in Duplex Co. v. Deering, 254 U. S. 443 , members of labor unions having a controversy with their employers sought to embarrass the sales by their employers of the product of their manufacture in other States by boycott and otherwise. They were held guilty of a conspiracy against interstate commerce because of their palpable intent to achieve their purpose by direct obstruction of that commerce.

The cases of Stafford v. Wallace, 258 U. S. 495 , and Chicago Board of Trade v. Olsen, 262 U. S. 1 , are also supposed in some way to sustain the view that a strike against the manufacture of commodities intended to be shipped in interstate commerce is a conspiracy against that commerce. What those cases decided was that when Congress found from investigation that more or less constant abusive practices and a course of business, usually only within state police cognizance, threatened to obstruct or unduly to burden the freedom of interstate commerce, it could by law institute supervision of such course of business in order to prevent the abuses having such effect. As said in Stafford v. Wallace (p. 520):

“ The reasonable fear by Congress that such acts, usually lawful and affecting only intrastate commerce when considered alone, will probably and more or less constantly be used in conspiracies against interstate commerce or constitute a direct and undue burden on it, expressed in this remedial legislation, serves the same purpose as the intent charged in the Swift indictment to bring acts of a similar character into the current of interstate commerce for federal restraint.”

In United States v. Patten, 226 U. S. 525 , 543, running a corner in the available supply of a staple commodity, normally the subject of interstate commerce, in order to enhance its price artificially in the whole country, although the corner was carried on only in New York by sale of cotton futures, was held to be a monopoly of interstate commerce in violation of the Federal Anti-Trust Act. It was the intent to monopolize such commerce and its probability of success which sustained the indictment.

In the Coronado Case, supra, (p. 410), this Court referred to the Patten Case and the difference between that and the Coronado Case as follows:

“ The difference between the Patten Case and that of Ware & Leland v. Mobile County, 209 U. S. 405 , illustrates a distinction to be drawn in cases which do not involve interstate commerce intrinsically but which may or may not be regarded as affecting interstate commerce so directly as to be within the federal regulatory power. In the Ware & Leland Case, the question was whether a State could tax the business of a broker dealing in contracts for the future delivery of cotton where there was no obligation to ship from one State to another. The tax was sustained and dealing in cotton futures was held not to be interstate commerce, and yet thereafter such dealings in cotton futures as were alleged in the Patten Case where they were part of a conspiracy to bring the entire cotton trade within its influence, were held to be in restraint of

interstate commerce. And so in the case at bar, coal mining is not interstate commerce and obstruction of coal mining, though it may prevent coal from going into interstate commerce, is not a restraint of that commerce unless the obstruction to mining is intended to restrain commerce in it or has necessarily such a direct, material and substantial effect to restrain it that the intent reasonably must be inferred.”

This review of the cases makes it clear that the mere reduction in the supply of an article to be shipped in interstate commerce, by the illegal or tortious prevention of its manufacture, is ordinarily an indirect and remote obstruction to that commerce. It is only when the intent or necessary effect upon such commerce in the article is to enable those preventing the manufacture to^ monopolize the supply, control its price or discriminate as between its would-be purchasers, that the unlawful interference with its manufacture can be said directly to burden interstate commerce.

The record is entirely without evidence or circumstances to show that the defendants in their conspiracy to deprive the complainants of their workers were thus directing their scheme against interstate commerce. It is true that they were, in this labor controversy, hoping that the loss of business in selling goods would furnish a motive to the complainants to yield to demands in respect to the terms of employment; but they did nothing which in any way directly interfered with the interstate transportation or sales of the complainants’ product.

We concur with the dissenting Judge in the Circuit Court of Appeals when, in speaking of the conclusion of the majority, he said: “ The natural, logical and inevitable result will be that every strike in any industry or even in any single factory will be within the Sherman Act and subject to federal jurisdiction provided any appreciable amount of its product enters into interstate -commerce.” ( 284 Fed. 446 , 464.)

Decree reversed.

Mr. Justice McKenna, Mr. Justice Van Devanter, and Mr. Justice Butler, dissent.