Mr. WALLACE. I think we have a right, then, Mr. Focht, to inform those who feel with us, presumably working people, who have the same ideas we have, that this man has a dispute on hand, and that is the extent of what I believe we have a right to do.

Mr. SPROUL. Yes; but you go further than that.

The CHAIRMAN. Somebody read into the record an article describing how people were beaten up and clothing was torn from girls. That is interfering with their right to work, is it not?

Mr. WALLACE. That is against the law as it now exists.

The CHAIRMAN. But you hire men to do that.

Mr. WALLACE. I deny that, Mr. Focht.

The CHAIRMAN. I want you to deny it. You will not live, or any other labor organization, unless you do deny it.

Mr. WALLACE. We deny we hire anyone.

The CHAIRMAN. That is good stuff. That is all right, if you deny it.

Mr. BLANTON. Do you desire to introduce any other evidence besides this brief? If you do, I am perfectly willing, as one member of the committee, to allow you to introduce all the evidence you want, and if you want to ask me any questions concerning any

matter

Mr. WALLACE. No; I do not want to ask any questions.

I have here the decision of the judge in the police court case entitled "District of Columbia v. John K. Lynch and others." He goes further than deciding on this particular phase of the law. He quotes men's rights under the Constitution. I would like to introduce his statement.

The CHAIRMAN. What part do you want to introduce?

Mr. WALLACE. I will try to find it, Mr. Chairman. It is on page 29, to the conclusion. It is the court's decision only.

Mr. BLANTON. Does that embrace all of the decision?

Mr. WALLACE. It approximately embraces his entire decision. It begins on page 29. There are some interpolations there by the lawyers.

That will be all I have to say

(The brief for defendants in error in the case of William Truax et al. v. Michael Corrigan et al. is here printed in full, as follows:)

[In the Supreme Court of the United States, October Term, 1919. No. 307. William Truax et al. plaintiffs in error, v. Michael Corrigan et al., defendants in error.]

BRIEF FOR DEFENDANTS IN ERROR.

STATEMENT OF THE CASE.

As is set out at length in the brief of plaintiffs in error, this suit is brought because of so-called picketing indulged in by the defendants consequent upon labor difficulties affecting the plaintiffs' business establishment at Bisbee, Ariz. The defendants are charged with having caused certain persons to walk back and forth in front of plaintiffs' restaurant bearing banners which were easily legible from either side of the street, and from a great distance in other directions, which banners pointed out the existence of a dispute between plaintiffs and defendants and described plaintiffs' establishment as unfair. It is further said that the defendants and other persons caused persons to attend at or near the entrance to the restaurant and to hand the plaintiffs' customers and patrons hand bills referring to plaintiffs and their restaurant as being unfair, and advising and persuading, or attempting so to do, plaintiffs' customers to cease from patronizing the plaintiffs. It is said that the defendants and other persons unknown to plaintiffs caused persons to attend at or near the entrance to said

restaurant when it was open for business and announce and proclaim repeatedly in a voice audible for a great distance that plaintiffs' restaurant was unfair, and recommended, etc., plaintiffs' customers and patrons and other persons to refrain from patronizing or trading with plaintiffs in their restaurant.

As a consequence it is charged that plaintiffs' patronage fell off to the extent of over one-half.

It is further set up that in the doing of the several acts defendants were relying upon the provisions of paragraph 1464 of the Civil Code, Revised Statutes of Arizona, 1913, reading as follows:

"No restraining order or injunction shall be granted by any court of this State, or a judge or the judges thereof, in any case between an employer and employees, or between employers and employees, or between employees, or between persons employed and persons seeking employment, involving or growing out of a dispute concerning terms or conditions of employment, unless necessary to prevent irreparable injury to property or to a property right of the party making the application, for which injury there is no adequate remedy at law, and such property or property right must be described with particularity in the application, which must be in writing and sworn to by the applicant or by his agent or attorney.

"And no such restraining order or injunction shall prohibit any person or persons from terminating any relation of employment, or from ceasing to perform any work or labor, or from recommending, advising, or persuading others by peaceful means so to do; or from attending at or near a house or place where any person resides or works, or carries on business, or happens to be for the purpose of peacefully obtaining or communicating information, or of peacefully persuading any person to work or to abstain from working; or from ceasing to patronize or to employ any party to such dispute; or from commanding, advising, or persuading others by peaceful means so to do; or from paying or giving to or withholding from any person engaged in such dispute any strike benefits or other moneys or things of value; or from peaceably assembling at any place in a lawful manner and for lawful purposes; or from doing any act or thing which might lawfully be done in the absence of such dispute by any party thereto.

It is further said that such paragraph violates and contravenes the fourteenth amendment to the Constitution of the United States by depriving plaintiffs of their property without due process of law and denying them the equal protection of the laws of the State of Arizona, and that such paragraph is null and void.

It was asked that all of the defendants be restrained from inaugurating, carrying on, or taking part in such a "boycott" as has been set forth, or from inducing persons to cease or refrain from patronizing or trading with plaintiffs and carrying or displaying banners or other device calling attention to the dispute between plaintiffs and defendants, or referring to them or their restaurant as being "unfair," or recommending, advising, persuading, or attempting to persuade any person to refrain from patronizing them, and from writing, printing, etc.. or circulating any handbills calling attention to such dispute, or referring to plaintiffs or their restaurant as unfair, or recommending, etc., any person to cease from patronizing plaintiffs, and from orally or otherwise advertising or calling attention to any such boycott or dispute, or referring to plaintiffs or their restaurant as unfair, or recommending any person to cease from patronizing it, and generally from doing any act for the purpose of coercing plaintiffs to comply with any demands of defendants, or coercing them to settle any dispute between the parties.

It is further specifically asked that paragraph 1464 of the Civil Code be declared unconstitutional.

A large number of exhibits are attached to the complaint, consisting of the hand bills which were circulated prejudicial to plaintiff's business as claimed.

A demurrer was filed to the complaint (Rec., p. 15) alleging that it did not state facts sufficient to constitute a cause of action in that the property rights referred to in said complaint and which the said complaint alleged as irreparably injured, and from which the plaintiffs had suffered great and irreparable loss and damage, was not such property as under section 1464 was contemplated or included as property or property rights, the irreparable injury of which might be enjoined.

Upon consideration of the demurrer it was sustained in the lower court and on appeal the action of the lower court was affirmed in the Supreme Court of Arizona (Rec., pp. 17 to 20).

THE ESSENCE OF THE BILL.

It is notable that the issue in this case is confined within a much smaller compass than is usual in cases of this description. There is no allegation of violence or threat of violence. It is not suggested that plaintiffs' patrons have been interfered with in

their entrance to or egress from plaintiffs' restaurant, nor that they were rudely accosted. It is not suggested that the defendants' actions have been indulged in for any other purpose than bringing about a settlement of the dispute between the parties; nor is it suggested at any point that plaintiffs' patrons are themselves to suffer directly or indirectly from continuing to extend their patronage to the plaintiffs. It is not contended that the defendants have libeled or misrepresented the plaintiffs, or that they have done anything except to present to the public their own side of the existing dispute. The case, therefore, is to be differentiated from practically every other controversy brought before the courts and in which injunctive relief has been granted. The bare issue presented in this case is whether peaceable persuasion by circulars, banners, and word of mouth is intrinsically unlawful, and by its very existence unlawfully takes away from the plaintiffs some property or property rights belonging to them.

ARGUMENT.

We have just stated what must be regarded as the sole issue in the case, which is, whether peaceable persuasion by printed circulars, banners, or word of mouth in such case as this invades property or property rights of the plaintiffs. While the question, as we shall find, has been most largely discussed in picketing cases, yet, analyzing this situation, the picketing is purely incidental. In the present instance it is a means adopted, by the methods referred to, to convey to the public information of the fact that plaintiffs' establishment was deemed unfair. This "picketing" can not be regarded in any other light, because no State or municipal law has been violated by the "pickets," and the ingress and egress of customers has not been interfered with. The situation is not otherwise than it would have been had all the persons communicating the information resorted to the mails or stationed themselves a hundred yards away from plaintiffs' place of business. We shall, nevertheless, later on, discuss the authorities relative to the general subject of picketing, as they will shed important light upon the question at issue.

If property or a property right belonging to the plaintiffs has been reduced in value by the defendants and the statutes of Arizona have denied a remedy to the plaintiffs, this property or property right must be susceptible of definition or description. We gather from the plaintiffs' brief that they consider that the good will of their business has been impaired or taken away from them, and that this really is the right they have lost. We deny that they possess any such absolute good will as against the defendants that it may be called property.

Good will, which is property, is something which ordinarily arises out of contract, and wherever it is said to be infringed, and no contract relations have been shown to exist, such statement is made, as we shall find, because some law has been violated, upon the existence and observance of which the complaining party had a right to rely or some nuisance of a public character exists from which the plaintiff has suffered special damages.

When a man sells his business with its "good will," so-called, covenanting that he will not reestablish himself in like business in a given neighborhood or within a certain length of time, he creates a contract relation and may not violate his contract without exposing himself to proceedings in equity. The essence of the situation is not then the intangible thing called "good will" after all, but is a very tangible contract by which the rights of the parties are to be measured.

Divorced from the element of contract, however, good will lacks real substance. If a man buys a store with its good will, another may establish a like store next door, and, no contract relation existing, speedily destroy the ephemeral thing called good will. A court of equity may not be resorted to ordinarily because there is no contract relation between the parties. If the second comer resorts to unfair business methods and false statements about his neighbor, then resort may be had to a court of equity, even though his neighbor's business is just being established and has had no chance whatever to acquire a good will. It is evident, therefore, that under such circumstances the thing which the courts protect is not good will in any usual sense of the term, but a man's fair right to obtain a livelihood irrespective of whether he has pursued that particular occupation theretofore or not.

In the present instance, therefore, there in no contract relation of good will: there is no right to appeal to a court of equity except it be that by some means considered by the law improper under all the circumstances of the case the defendants have injured or destroyed plaintiffs' opportunity to gain a livelihood. This they have not done by the violation of any law, by the creation of any nuisance, or in any manner save one communication to the public by every means within their power of the fact that plaintiffs' establishment is what is called "unfair" to organized labor, and this statement is, as appears from the complaint itself, an entirely truthful one, and

the defendants had, as will fully appear, an interest in making the fact known to the public. This interest was twofold in nature. They desired to convince the plaintiffs that it was more to their interest to comply with the terms of employment sought by the union that such terms of employment, when made known to the public, would appeal to more people-than the pursuit of a contrary course; and, further, the defendants believed that the more widely plaintiffs' unfairness was known the more general would be the patronage of those establishments where union men were employed, and therefore they would be incidently benefited. Hence the work of the union did not constitute a gratuitous attempt to interfere with the plaintiffs' business.

We recognize fully the fact that by the weight of authority, even though these objects of which we speak are generally recognized as sufficient to justify such action on the part of unions, yet, if coupled with wantonness or disorder, or creating a public nuisance, which especially affects the employer, he may appeal to a court of equity. What we have so far said, however, is for the purpose of showing that there is no such thing, aside from contract rights, as an absolute good will entitling to relief and protection at the hands of a court of equity.

We may add at this point that assuredly in the absence of wantonness, which can not be charged here, and in the absence of libel, which is not charged, the defendants have an absolute right of free speech, and this right of freedom of speech extends, likewise, to freedom of publication. Rights in this respect are more sacred than are rights to conduct business; their destruction would paralyze all hope of improvement in society.

THE CLAYTON ACT.

The court will have noticed the strong resemblance between the language used in the provision of the Arizona Code under consideration and that contained particularly in section 20 of the Clayton Act approved October 15, 1914. The material sections of the Clayton Act are 6 and 20, reading as follows:

"SEC. 6. That the labor of a human being is not a commodity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor, agricultural, or horticultural organizations, instituted for the purposes of mutual help, and not having capital stock or donducted for profit, or to forbid or restrain individual members of such organizations from lawfully carrying out the legitimate objects thereof; nor shall such organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade, under the antitrust laws.

"SEC. 20. That no restraining order or injunction shall be granted by any court of the United States, or a judge or the judges thereof, in any case between an employer and employees, or between employers and employees, or between employees, or between persons employed and persons seeking employment, involving, or growing out of, a dispute concerning terms or conditions of employment, unless necessary to prevent irreparable injury to property, or to a property right, of the party making the application, for which injury there is no adequate remedy at law and such property or property right must be described with particularity in the application, which must be in writing and sworn to by the applicant or by his agent or attorney.

"And no such restraining order or injunction shall prohibit any person or persons. whether singly or in concert, from terminating any relation of employment, or from ceasing to perform any work or labor or from recommending, advising, or persuading others by peaceful means so to do; or from attending at any place where any such person or persons may lawfully be, for the purpose of peacefully obtaining or communicating information, or from peacefully persuading any person to work or to abstain from working, or from ceasing to patronize or to employ any party to such dispute, or from recommending, advising, or persuading others by peaceful and lawful means so to do; or from paying or giving to, or withholding from, any person engaged in such dispute, any strike benefits or other moneys or things of value; or from peaceably assembling in a lawful manner, and for lawful purposes; or from doing any act or thing which might lawfully be done in the absence of such dispute by any party thereto; nor shall any of the acts specified in this paragraph be considered or held to be violations of any law of the United States."

These paragraphs of the Clayton Act have been before courts of the United States for consideration on many occasions, and never has it been suggested by any court that the Clayton Act was unconstitutional or deprived anyone of property or a property right. We will refer to the Federal authorities bearing upon this point, and also upon the general proposition with regard to picketing, although for reasons we have stated, we do not look upon picketing, so called per se, as an important element even in this case.

In the case of Alaska Steamship Co. v. International Longshoremen's Association (236 Fed., 964), Judge Neterer, of the District Court, Western District of Washington, undertook to limit the actions of a picket to "interviews, peaceable persuasion, and inducements," without any suggestion that when so limited such acts could be unlawful. He gave full consideration to the Clayton Act as existing and constitutional, and while his conclusion was adverse to the labor organization involved because of certain acts of violence which were recited, and a failure to suppress them on the part of the union, he nevertheless denied that it was "the purpose of this court to abridge any of the rights given by section 20 of the antitrust act" (the Clayton Act).

In the case of Tri-City Central Trades Council v. American Steel Foundries (238 Fed., p. 728), the trial court had enjoined the defendants from doing any acts or things whatever in furtherance of any conspiracy or combination among them to obstruct or interfere with the plaintiff in the control and operation of its plant, and also from ordering, etc., or in any manner abetting any person committing any or either of such acts. And the court said:

66 6

"The obvious effect and purpose of this decree was, among other things, to prevent all picketing by the defendants or others similarly interested, and to prevent these parties from persuading their fellow employees to jojn them in their effort to secure what the strikers apparently considered the laborers' just demands. In Iron Molders' Union 125, of Milwaukee v. Allis-Chalmers Co. (166 Fed., 45; 91 C. C. A., 631; 20 L. R. A. (N. S.), 315) the rule is so well stated that we quote from it the following: The right to persuade new men to quit or decline employment is of little worth unless the strikers may ascertain who are the men that their late employer has persuaded or is attempting to persuade to accept employment. Under the name of persuasion duress may be used; but it is duress, not persuasion, that should be restrained and punished. In the guise of picketing strikers may obstruct and annoy the new men, and by insult and menacing attitude intimidate them as effectually as by physical assault. But from the evidence it can always be determined whether the efforts of the pickets are limited to getting into communication with the new men for the purpose of presenting arguments and appeals to their free judgments. Prohibitions of persuasion and picketing, as such, should not be included in the decree.'” In further discussion touching the question of picketing the court said: "In the pursuit of a lawful purpose, to secure a raise in wages, picketing may be employed, as this court has held, to ascertain whom the late employer has persuaded or attempted to persuade to accept employment,' and persuasion may be used to induce them to refuse or quit the employment. As stated further in the Allis-Chalmers

case:

*

The right of the one to persuade (but not coerce) the unemployed to accept certain terms is limited and conditioned by the right of the other to dissuade (but not restrain) them from accepting. * *Molders, having struck, in order to make their strike effective, may persuade (but not coerce) other molders not to work for less wages or under worse conditions than those for which they struck, and not to work for their late employer at all, so that he may be forced to take them back into his foundry at their own terms.'"

As of incidental value in determining the meaning of the word "employees" in connection with the act under consideration we quote from the same case:

"Plaintiff's further contention that the defendants were not its employees at the time of the strike, and therefore had no right to picket or persuade by argument those about to enter plaintiff's employment, is not well taken. It is true a striker is not technically an employee. The relation of employer and employee is temporarily suspended during the strike. The situation has been described as:

A relationship between employer and employee that is neither that of a general employer and employee,' nor that of employer and employee seeking work from them as strangers.'

"Neither strike nor lockout fully terminates during the strike the relationship between the parties. Among the defendants in this case there were some former employees. Many of the plaintiff's employees at the time of the strike were members of the defendants' organization, the Tri-City Central Trades Council. These facts disprove the charge that the defendants were merely intermeddling in the affairs of a company in which they had no interest. Under these circumstances it can not be said that the labor organization was an intermeddler or that its course was contrary to the wishes of its members or the wishes of the plaintiff's employees.

"In so far as the decree restrains all picketing and all persuasion and all interference with the plaintiff's free and unrestrained control of its plant and the operation of its business, it transcends the limit of proper restraint, and should be modified, so as to eliminate therefrom any restraining of defendants from doing lawful acts as indicated herein. The order of this court for the modification of the decree in the