by the appellate court1 and by the Supreme Court of Illinois. In California, where a fire insurance company complained that certain representatives of a board of underwriters had threatened to boycott firms and individuals holding policies issued by the complainant and other "nonboard" companies unless they forthwith canceled the policies, a Federal court enjoined such threats, and referred to the defendants' conduct as unlawful and unjustifiable. Still other methods employed by combinations of dealers have been declared unlawful. Thus in New York it has been held actionable for the president of a retail druggists' association and others to conspire to ruin the business of other druggists, and to resort to threats, intimidation, libel and slander, and interference with the plaintiffs' advertising. In another case it appeared that the agents of an implement and hardware dealers' association in Washington had interfered with salesmen peddling wagons and buggies for a manufacturer in another State, by following and intimidating them, interrupting their conversations with customers, and advising the latter not to buy. Some of the followers carried rifles, some had been made deputy sheriffs, and in one instance one of the salesmen was arrested by such a sheriff under a provision of a law which had been declared void. The Federal court was of the opinion that such acts constituted an unwarranted interference with the plaintiffs' business and issued a temporary injunction."

4

ENGLISH DECISIONS.

The most important English case involving the legality of certain methods of competition was decided by the House of Lords in 1891. It was then held lawful for the owners of a number of steamships operating between China and England, in order to secure the entire tea-carrying trade, to enter into agreements providing for the regulation of this traffic as among themselves, the determination of the rates of freight, the semiannual payment of rebates to such persons as shipped exclusively by their vessels, and the sending of vessels to a certain shipping point to secure freight without regard to remu

1 Purington et al. v. Hinchliff, 120 Ill. App., 523, 533 (1905). Per Freeman, J.: "Lawful competition in trade may have the effect of driving men out of business and creating a practical monopoly in those who survive the struggle. Such competition is legitimate, however, and not actionable, although its effect in particular cases may be similar to that brought about by unlawful means employed to destroy competition. That this may happen is no excuse or justification for the use of unlawful methods, by combination or otherwise, with intent to do a wrongful injury by inducing, as in the case before us, former customers not to deal with appellee nor to buy or use brick of his manufacture." 2 Purington et al. v. Hinchliff, 219 Ill., 159 (1905).

3 Continental Insurance Co. v. Board of Fire Underwriters of the Pacific, 67 Fed., 310 (C. C., 1895).

Rourke et al. v. Elk Drug Co. et al., 75 N. Y. App. Div., 145 (1902).

Spaulding et al. v. Evenson et al., 149 Fed., 913 (1906); aff. Evenson et al. v. Spaulding et al., 150 Fed., 517 (1907). See form of injunction, p. 407.

nerative rates whenever a rival vessel left for that port, and further providing that the agents of parties to the agreement should be prohibited from being interested in rival steamers or from loading sailing vessels belonging to outsiders. A shipping company which had been excluded from this association or conference and had been injured by the carrying out of these agreements brought an action against the members of the combination, alleging a conspiracy, and claiming damages and an injunction. It was held by the House of Lords that as neither the object of the combination nor the means employed were unlawful the action could not be maintained. Lord Halsbury observed that if an offer by the members of an associated body of traders of reduced freights to persons who would deal exclusively with them was unlawful, it would seem "that the greater part of commercial dealings, where there is rivalry in trade, must be equally unlawful;" and Lord Hannen expressed the opinion that this, in effect, is "nothing more than the ordinary form of competition between traders by offering goods or services at a cheaper rate than their rivals."

With respect to rate cutting, Lord Watson said, in part: "I can not for a moment suppose that it is the proper function of English courts of law to fix the lowest prices at which traders can sell or hire, for the purpose of protecting or extending their business, without committing a legal wrong which will subject them in damages." Lord Bramwell also expressed the opinion that in resorting to this method of attracting customers "the defendants did no more than they had a legal right to do."

Lord Watson and Lord Hannen were of opinion that the withdrawal of the defendants' agency from persons who also represented nonconference steamers, could not be regarded as an illegal act, and Lord Morris expressed the view that the dismissal of agents. might be questionable, according to circumstances, but in the present case they filled an irreconcilable position in being the agents for two rivals, and that "dismissal under such circumstances became, perhaps, a necessary incident of the warfare in trade." It has also been held lawful for members of a print sellers' association to publish circulars suggesting that dealers agree not to order from houses whose publications were systematically offered by certain notorious undersellers, although the effect of such action was to prevent the plaintiffs from obtaining further supplies from the publishers.2

1 Mogul Steamship Co. (Ltd.) v. McGregor, Gow & Co. et al., L. R. (1892), A. C., 25, affirming L. R. (1889), 23 Q. B. D., 598, and L. R. (1888), 21 Q. B. D., 544. Cf. Lough et al. v. Outerbridge et al., p. 455.

It may

2 Boots et al. v. Grundy et al., 16 Times Law Reps., 457 (Q. B. Div., 1900). be noted that defendants' counsel, one of whom was Rufus Isaacs, Q. C. (now Lord Chief Justice) contended, among other things, that the statement of claim disclosed no cause of action, "as it only alleged an unfair competition on the part of the defendants."

In Scotland, where it appeared that American and Canadian meat could be obtained only at the Yorkhill Wharf, Glasgow, where it was sold at auction, it was held lawful for a butchers' association to notify the cattle salesmen that they would not buy at their auction sales unless they declined to sell to certain competing cooperative stores, and likewise to threaten to withdraw their patronage from hide merchants who dealt with cooperative societies. The court was of opinion that it was lawful for the salesmen to decline to receive bids from such stores and that the butchers were not liable for inducing by lawful means, an act which was lawful in itself.1

On the other hand, in Ireland, where the acts complained of would apparently have been illegal in the absence of a combination, the defendants have been held liable. Thus where it was found that certain members of a stevedores' association and representatives of a labor union agreed to compel another stevedore to join the employers' organization, and to that end used threats and procured his laborers to break their contracts of employment, it was held by the Court of Appeal that such conduct was actionable.2

In an earlier Irish case it appeared that certain coopers, in order to injure the business of a manufacturer of machine-made firkins, induced a number of butter merchants to publish a notice to farmers stating that they would not purchase butter packed in machine-made firkins, as they had been found to be most injurious to the keeping qualities of butter, and urging the necessity of packing their butter in hand-made firkins. The manufacturer thereupon brought an action against several of the merchants and officers of coopers' societies and guilds claiming an injunction and damages for libel and conspiracy. The court granted an injunction pending the hearing of the case, being of the opinion that if the allegations were proved, damages would not afford sufficient compensation, but that an injunction would be awarded to restrain future acts of a like character.3

In Australia it has been held unlawful for a grocers' association to induce the members of a brewers' club not to sell beer to grocers who did not maintain list prices, and accordingly to refuse to sell to a grocer who had reduced prices, until he should join the association.1 In a more recent case, however, involving substantially similar facts, another Australian court held a contrary view. There it appeared

1 Scottish Cooperative Wholesale Society (Ltd.) v. Glasgow Fleshers' Trade Defense Association et al., 35 Scottish Law Rep., 645 (1898). An ordinance subsequently passed by the local authority providing that sale rings at the public wharf should not be used for private sales, sales to any limited number of persons, or sales in which any class of the public are excluded from bidding or buying, was held valid by the Court of Sessions, in Scott et al v. Magistrates of Glasgow, 36 Scottish Law Rep., 458 (1899).

2 Long v. Larkin et al. (1914), 2 Irish Reps., 285, 329. While this report was on the press the above decision was affirmed by the House of Lords. See Larkin et al. v. Long, L. R. (1915), A. C., 814.

Punch v. Boyd et al., 16 L. R. (Ireland), 476 (1885).

4 Taffs v. Beesley, 16 Australian Law Times, 59 (Victoria, 1894).

that a retail butchers' association entered into an arrangement with a wholesalers' association, the members of the latter agreeing not to supply retailers who sold below certain fixed prices. The plaintiff, a retail butcher, became a member of the association, but refused to be bound by the prices agreed upon, and as a consequence the wholesalers refused to supply him further with meat. A verdict for the plaintiff was set aside on appeal, the court being of opinion that the defendants were merely acting for the protection of their own interests and not to injure the plaintiff whose legal rights had not been infringed.1

Section 12. Intimidation, obstruction, and molestation of competitors or their customers.

2

In 1914 the Supreme Court of Michigan expressed the opinion that "there are many ways, other than by interference with contract, of harassing, interfering with, and obstructing a competitor in such a manner as to amount to unfair competition, in the broadest sense of the term," and that "the business of another may be unlawfully obtained by harassing his customers and salesmen, just as effectively as by passing off his [sic] goods as those of another." The Supreme Court of Massachusetts has also declared that "no man can justify an interference with another man's business through fraud or misrepresentation, nor by intimidation, obstruction, or molestation "3 and the courts of a number of other States have used similar expressions.* Likewise in England the lord chancellor observed that "intimidation, violence, molestation, or the procuring of people to break their contracts are all of them unlawful acts." 5

AMERICAN DECISIONS.

The reported cases disclose the fact that these methods have in a few instances been employed to embarrass competitors or drive them out of business. Thus, in Standard Oil Co. v. Doyle, where the testimony tended to prove such practices, the court, while conceding that "one man may by fair methods compete with a rival until by sheer force of competition, by underselling or outbidding him, his own business is built up to the detriment and ruin of his rival,"

1 Rea et al. (defendants) v. Buckland (plaintiff), 11 Western Australian Law Reps., 2 (1908).

2 Attorney General v. National Cash Register Co., 148 N. W., 420, 428 (Mich. Sup. Ct., 1914).

3 Martell v. White, 185 Mass., 255, 261 (1904).

4 Crump v. Commonwealth, 84 Va., 927, 940, 941 (1888); Jackson v. Stanfield, 137 Ind., 592, 613 (1893); Vegelahn v. Guntner, 167 Mass., 92, 99 (1896); Doremus v. Hennessy, 176 Ill., 608, 614 (1898); My Maryland Lodge v. Adt, 100 Md., 238, 250 (1905); Victor Talking Machine Co. v. Lucker, 150 N. W., 790 (Minn. Sup. Ct., 1915). 5 Mogul Steamship Co. v. McGregor, Gow & Co., L. R. (1892), A. C., 25, 37.

118 Ky., 662, 670 (1904).

declared that a different case is presented where one seeks to destroy the rival's business by unlawful means and that it was most assuredly unlawful to obstruct, harass, and annoy Doyle's employees, to threaten his customers, and to procure his arrest on false charges for the purpose of alienating his patrons.

Somewhat similar methods were disclosed in Spaulding v. Evenson, where the Inland Empire Implement & Hardware Dealers' Association and certain of its representatives were temporarily enjoined from—

preceding or following in close range any employee, agent, or servant of the complainants or the teams used by them or any of them in such manner as to hinder, obstruct, harass, annoy, or intimidate the complainants or any of their employees in the free use of the highway, and from in any other manner occupying said highway in such a manner as to hinder, obstruct, harass, annoy, or intimidate the complainants or any of their employees in the free use thereof; also from approaching or speaking to any actual or supposed customer or customers of the complainants so long as complainants' agents or servants are personally present and engaged in selling or negotiating the sale of any buggy or wagon, for the purpose of defeating such sale by the complainants; also from resorting to any species of intimidation, force, or fraud, or any conduct that would imply intimidation, force, coercion, or fraud, for the purpose of preventing complainants from selling buggies or wagons and carrying on said business of selling buggies or wagons.

Although in this case it was contended that if any damage was sustained by the complainants it was the unavoidable result of competition, the circuit court of appeals expressed the opinion that "the right of competition furnishes no justification for such acts."

Likewise on the complaint of the Economist Furnace Co., certain employees of the Wrought-Iron Range Co. were enjoined from molesting, interrupting, hindering, disturbing or otherwise interfering with, or threatening or intimidating the plaintiff or its agents, and were adjudged guilty of contempt for violating the order of the court. Subsequently in a suit brought by the Drake Hardware Co. in New York, the Wrought-Iron Range Co. and its employees were again enjoined from engaging in similar practices, and more recently in North Carolina a number of its agents were indicted and charged with a conspiracy to break up the business of the St. Louis Steel Range Co. by like methods. In Louisiana a merchant and his employees were enjoined from "inducing, rushing, or crowding" persons from in front of the windows of a competitor into his own store, from representing that plaintiff's store was a portion of the de

1149 Fed., 913 (C. C., 1906), aff. 150 Fed., 520, 522 (C. C. A., 1907).

2 Economist Furnace Co. v. Wrought-Iron Range Co. et al., 86 Fed., 1010, 1011 (C. C., 1898).

3 Drake Hardware Co. v. Wrought-Iron Range Co., 78 N. Y. Supp., 1114 (Sup. Ct., App. Div., 1902).

State v. Dalton et al., 83 S. E., 693 (N. C. Sup. Ct., 1914).