He said, "I had no right to invite you. I have no authority to invite you."

Then another one of these fellows who also gets edges got up and said, "Well, I think Mr. Kotin was invited, but I did not think he took the invitation seriously."

Then another fellow got up and he said, "Mr. Chairman, I suggest that we cannot hear Mr. Kotin. I have not got my lawyer with me. I left him at Atlanta." He said, "Have you got the lawyer here in the association?" and the chairman said, "No; I left him in St. Louis."

So here they were without lawyers and they did not want me to speak on the Robinson-Patman Act. There was a vote taken on the floor and it was decided I should speak, then be told to get out. So I spoke, then I was told to go out, and then I went home. That is the end of that.

By the way, at that meeting I went into these problems I am presenting to you now very thoroughly and that I presented to the Commission. I told them that I thought it was unhealthy for businessmen in America to decide what laws they want to obey. Some of the men said, "Mr. Kotin, you are trying to get the fellow with the whiskers tangled up in your business."

Mr. BALLINGER. Who is the fellow with the whiskers?

Mr. KOTIN. Uncle Sam. He said, "You are simply creating a Frankenstein." He said, "After you get us into trouble with the Government with your law"-this is now my law-"after you get us in trouble, then we will have to hire you to get us out."

Then another fellow spoke up and he said, "Mr. Kotin, do you want to control the prices?"

I said, "No; I have never asked anybody what to sell for. I do not care what their price is provided it is the same price to everybody and not different prices to different people at the same time.' Mr. BALLINGER. You mean for the same quantity?

Mr. KOTIN. It can be for a little different quantity. I am talking about where there is no actual cost saving. I know enough about this business to tell you this: If they have a cost saving of 1 percent, they get an edge of 25. That is the cost saving we are talking about.

Mr. BALLINGER. They are entitled to 1, but they get 25?

Mr. KOTIN. Yes. The 15, 25, depending on how big you are and how bad one fellow wants to grab it away from the other fellow.

We have one outfit that belongs to the association that sells today on a one point profit to the big chains. That is what he operates on-1 percent-but when he sells to the little shoe repairer he gets his 30 percent from him. He gets the full price from him, the 30 percent from the little guy. When he wants to make a sale to somebody to take away somebody else's business, he has enough room to cut down 5 or 10 or 15 percent. That happens in our own territory.

Mr. BALLINGER. Is it not true that so far as the sale of rubber heels is concerned, most of them are fair-traded as far as the business is concerned?

Mr. KOTIN. Yes; they fair-trade their rubber heels, but let us be honest about that. There are cases with the rubber companies-I do not care to discuss that except in executive session-where I know this to be true: Certain people even though they fair-trade in dealing with the finders go ahead and give a 5 or 10 percent discount. They go ahead and give that discount of 5 or 10 percent because they want to

grab that business from their competitors. So I say that the fair trading in rubber heels is not honest in some cases. I do not make that accusation against all of them.

Let me show you something about this fair trading in rubber. Last November certain rubber companies came out with a notice to their finders that on and after a certain date, a month in advance, the price of rubber heels goes up. Take orders, all you can get now. The purpose was to load up the poor shoe repairer and the finder loaded them up so nobody else can sell them. When that date came around the same rubber companies, some of them, told those finders, "Do not change your price yet; wait until everybody else gets in line."

The whole deal was only to load up these shoe repairers do you get the point-using the increase in price, the fair-trade increase, as a cover-up for what was only a load up on rubber heels. We have discussed that at our meetings.

Mr. BALLINGER. When you were at this convention, were there a good many people there?

Mr. KOTIN. There were several hundred.

Mr. BALLINGER. Did you hear Mr. Levey make any statements detrimental to the enforcement of the Robinson-Patman Act?

Mr. KOTIN. I do not think he will deny it. He has always said he does not believe in the law, that it cannot be understood, it should not be enforced, that there is no such law. He has never denied that to anybody.

Mr. BALLINGER. Were these statements heard by other people there? Mr. KOTIN. Well, he told them: "Do not get Uncle Sam in your business. You are creating a Frankenstein. Keep the Government away from you. Just go about your business." He was even opposed to the Fair Trade Practice Conference. There was another fellow, a lawyer, I met for the first time in my life from Atlanta, Ga., a fellow by the name of Kaye. He got up and made a speech and said he used to work for the Government and from his experience with the Government he advised the businessmen not to let the Government have anything to do with his business, from his experience with the Government. That is his statement. Now, that is true. I am sure that we can get a copy of that talk.

Mr. BALLINGER. You mean so far as enforcing the laws of the Congress of the United States is concerned?

Mr. KOTIN. I do not know about that. He did not say about enforcing laws. He said not to permit the Government to have anything to do with business. That is why he was advising them to oppose voting for a trade-practice conference.

Chairman PLOESER. Do you think it can be interpreted as the official statement of this association that they ignore the Robinson-Patman Act?

Mr. KOTIN. Mr. Chairman, let me put it to you this way: I think it would be unfair if we were to charge the association with that position. It is more honest if we do this: There are certain men who control the destinies of that association and have for years, who also are the receivers of the edge from the supplier and are the men whom I believe to be guilty of the vicious practice of price discrimination that I am complaining about, who are at the head and control the destinies of that association, and that those individuals, those few, are the ones who have kept the association in ignorance, not the association itself.

I want to show you my point. Six months ago I prepared a letter which I addressed to the finders and shoe repairers of America and I sent the letter, which was a story of the Robinson-Patman Act and what the finder and shoe repairer could do to bring about enforcement of the Robinson-Patman Act. I sent this letter to the Shoe Service magazine, which is a magazine published by the national association. I sent it to the National Shoe Repairer, the Master Shoe Repairer at New York. I sent the letter to Caziolia, the third magazine, which are the only three publications that go to the shoe repairers. Those are the friends of the shoe repairers. Not one of them would publish my letter. They told me they would not dare publish the letter to let the shoe repairer know his rights.

You cannot get that information to the membership of the national association throughout the country. You cannot get that information to the shoe repairer. It has got to be kept secret. Now, that is the truth. I can give you copies of the letters. I can give you a copy of the letter showing where my script was rejected.

Chairman PLOESER. I would like to have those.

Mr. KOTIN. I wll turn them over to Mr. Ballinger.

Chairman PLOESER. They will be made a part of the record.

Mr. BALLINGER. Did you attend the national convention of the association that was held in June?

Mr. KOTIN. When Mr. Snow of the Federal Trade Commission discussed the workings of the Federal Trade Commission as far as trade practice conferences are concerned, I spoke on the motion to have the national association join in such a request for a conference, because I figured that maybe if we can get a trade practice conference we might sneak in the Robinson-Patman Act on the edges. The other way, you could not get anything done. That was voted down, because the high moguls of the industry, the ones who get the benefit of the edges and different other things we are talking about, were there in number enough to vote down the proposition.

Mr. BALLINGER. You wanted a trade conference in order to explain to the gentlemen what the Robinson-Patman Act was?

Mr. KOTIN. That is right.

Mr. BALLINGER. And to sort of educate them as to its purposes? Mr. KOTIN. Yes; the same as I did in my letter, but you cannot get it published.

I want to say this to you before I forget it, because I want this information I have made myself of record before the Federal Trade Commission available. As a result of what I am fighting to get enforced, the charge has been made that if I keep this up the association that I represent will be broken up and I will be prosecuted for trying to set prices.

Chairman PLOESER. Who has made that charge?

Mr. KOTIN. I do not want to make that statement to you. I would rather make it in executive session. I will give you the names of the gentlemen to whom they spoke and I will give you the names of all of them. They said I am going to be charged with trying to set prices and a conspiracy to violate the law of the land. I do not care what they sell their merchandise for, that does not interest me. I am interested in them obeying the Robinson-Patman Act just as you obey

any other law in America, because competition will take care of the price level.

Mr. BALLINGER. In your connection with this industry, have you ever advocated that the leather and finders gang up on any manufacturer and boycott him?

Mr. KOTIN. Never at any time. That is unheard of. As a matter of fact, I am the only one in the entire industry who openly tells people that they cannot solve their problems in that fashion; they cannot talk to their manufacturers about prices or anything like that. They must operate within the laws of the United States, I tell them. There are enough laws of the United States to give them relief. I am only in one industry. There are different ones in different sections of the country who are charged with such advocacy.

Mr. BALLINGER. At this present convention, the present year, did you find Mr. Levey again in the position of being opposed to the enforcing of the Robinson-Patman Act?

Mr. KOTIN. He was of the same opinion.

Let us not put the blame on Morris Levey. He is just one out of a number that I say are heading the policies of the association, who are opposed to any talk of the Robinson-Patman Act in the industry, or a fair trade practice conference. But he is not the sole industry. I do not think it would be fair to throw the responsibility on any one person. There is a group and that is the group that controls the deals and also controls the association.

Mr. BALLINGER. Wherever we go I am asking for these people who are opposing the Robinson-Patman Act. I brought Mr. Levey's name up because we are here in Omaha. You heard these things and I want it a matter of record. At other places I will ask for their names.

Mr. KOTIN. What I am telling you, other people can tell you the same thing. These are open meetings. These are not secret meetings. I have not had a secret conference with anybody.

Chairman PLOESER. Do you think enforcement of the RobinsonPatman Act in this industry would give you equitable relief?

Mr. KOTIN. I think, if the Robinson-Patman Act were enforced, you would save 68,000 little-business men in America-and it is the only way you are going to save them-and 1,200 little wholesale finders. But you have got to enforce the law.

I will tell you something further about the average finder. I have spoken to them. They will obey the law if the big fellow to whom he looks up for leadership will set the pattern. The big fellow will not do it because he is too greedy. The Government must force him to do it. When the Government forces him to do it, you will find 95 percent of the people will follow in line for the same honest things. I have done association work a long time, and I think I know how the people will operate.

Mr. BALLINGER. How long have you been connected with this industry?

Mr. KOTIN. About 10 years. It seems like a hundred, because I am so closely interwoven with leather and rubber heels, and I know what

goes on.

Mr. BALLINGER. You came here to represent your association?
Mr. KOTIN. I came here representing my association; yes.
Mr. BALLINGER. Did they pay your expenses here?

Mr. KOTIN. No, sir. I paid my expenses out of my own pocket, the same as I paid my expenses when I came to Washington to talk to you. I paid my own expenses because my association tells me that the Robinson-Patman Act is a vague law and they will not pay any expenses further in connection with it. So I said, "I will pay my own expenses and do the job," and that is true.

Chairman PLOESER. We thank you.

(Witness excused.)

TESTIMONY OF MORRIS LEVEY, ON BEHALF OF PHILADELPHIA LEATHER CO.

(The witness was duly sworn and testified as follows:)

Mr. BALLINGER. Give your full name.

Mr. LEVEY. Morris Levey.

Mr. BALLINGER. And the name of your business?

Mr. LEVEY. The Philadelphia Leather Co.

Mr. BALLINGER. You are president of the company?

Mr. LEVEY. That is right.

Mr. BALLINGER. You have heard the testimony of Mr. Kotin. Have you any comment you would like to make on that?

I

Mr. LEVEY. Well, naturally, I am at a tremendous disadvantage. Mr. Kotin is a trained attorney with a very smooth, glib tongue. could not hope to compete against him any more than I could go in the ring against Joe Louis. I cannot offer much of a defense, and I hope the committee will bear that in mind. I am just a small-business man who is doing what he thinks is right.

Chairman PLOESER. The committee bears in mind that I, as a businessman, make no concession to the lawyers or their ability; so go right ahead.

Mr. LEVEY. I am happy to hear that.

Chairman PLOESER. You sound just as good; so go right ahead.
Mr. LEVEY. What do you want?

Mr. BALLINGER. You heard Mr. Kotin's testimony. Have you been for a number of years an opponent of the Robinson-Patman Act?

Mr. LEVEY. NO; I am not an opponent of any Federal law that can be worked. I am an opponent of any law that can lead into further troubles. That has been our problem all the way through. I will observe any law that can be observed; that is, if it is feasible.

Mr. BALLINGER. You respect it by the tested feasibility?

Mr. LEVEY. No; I do not. I beg to differ with you. In other words, this Robinson-Patman law is a law we are abiding by. It is my understanding that the Robinson-Patman law says that I can buy at any price I am permitted to buy in open market; that I can make my own price, whether it is 1-percent profit or 100-percent profit, just so I sell like quantities to all customers at the same price.

Mr. BALLINGER. Let us straighten that out. You can buy at any price that is offered to you, but the fellow who is selling to you cannot do that.

Mr. LEVEY. Mr. Chairman, I cannot be the guardian of the manufacturer.

Mr. BALLINGER. You come into the picture when you start selling.