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In limiting the freedom of individuals in the conduct of business, or the disposal of their labor or commodities, courts ought not, and customarily do not promulgate prohibitions based on any doubtful or speculative balance of what may be, from all points of view and upon elaborate investigations of fact, most expedient and desirable. They prohibit only when a distinctive act is presented which is certainly inimical to the public interest, or which may, on a balancing of the opposing considerations, be so regarded. Where there is doubt or mere speculation as to results the tendency is to permit freedom of economic action. Yet in determining whether the distinctive act is certainly inimical to the public interest the courts must deal with economic facts and principles-especially those which are regarded as fundamental and not subject to serious controversy.
In this summary I have attempted to connect the prohibitions of the courts upon the freedom of economic action with the economic facts and principles upon which they rest. I have attempted in the text to balance economic considerations. In the notes are incorporated many quotations to indicate the economic facts and principles which the courts take cognizance of in reaching their conclusions. By this means I have sought not only to make an analysis of results but to illustrate a technique of reasoning.
I am indebted to the Harvard Law School for the opportunity of giving a course upon the subject of this volume in the year 1916-17, and of submitting the present analysis of the cases to the criticism and scrutiny of a third year class. I acknowledge a very great indebtedness to Walter T. Fisher for many valuable criticisms and suggestions. Parts of the present summary have
appeared as articles in the Harvard Law Review and the Cornell Law Quarterly.
For convenience in making references to my casebook on Contracts and Combinations in Restraint of Trade, the pages of the casebook are referred to enclosed in square brackets thus [-].
CHICAGO, FEB. 1, 1918.
A. M. K
TABLE OF CONTENTS
Sec. 1. The mere contract to refrain from doing business or from
entering or carrying on an occupation...
Sec. 2. Restrictive contracts accompanying the promisor's entry into
an apprenticeship arrangement, or made upon his entry into
the service of the promisee for the purpose of learning a
Sec. 3. Restrictive contracts accompanying the sale of a business,
which sale, however, is not made to a competitor.
(1) Where the restriction is not broader than the business
sold and is operative over a territory less than that
of any state where the restriction applies....
(2) Where the restriction is not broader than the business
sold but extends up to or beyond the limits of any
state where it is operative.....
(3) Where the restriction is broader than the business sold
and the business sold is not co-extensive with the
boundaries of the United States...
(4) Where the business sold is co-extensive with the boun-
daries of the United States but the restriction is
Sec. 4. Restrictive contracts accompanying the sale of a business to
an existing competitor where the restriction is so far lim-
ited as to be valid if the sale were not to a competitor...16, 17
Sec. 5. Restrictive contracts accompanying the combination of sev-