B 383254
AW BOOKS
ARTES
1837
SCIENTIA
LIBRARY
VERITAS
OF THE
UNIVERSITY OF MICHIGAN
E PLUMBUS UNDA
GEBOR
51-QUAERIS PENINSULAM AMOENAMU
CIRCUMSPICE
THE GIFT OF
Estate of Prof. K. Smalley.
H. GR. Die, 18, 1986.
HE
2710
.AI
1906
Hamon S. Jualley
Нам
མ་ིང་
Deals. 16, 1907.
SUPPLEMENT
ΤΟ
SNYDER'S INTERSTATE COMMERCE ACT
AND
FEDERAL ANTI-TRUST LAWS
EMBRACING
THE RAILWAY RATE BILL
APPROVED JUNE 29, 1906, AMENDING THE COM-
MERCE ACT AND ELKINS ACT
WITH AN INTRODUCTION
AND FULL NOTES OF JUDICIAL DECISIONS REN-
DERED SINCE THE PUBLICATION OF THE
WORK IN JULY, 1904, WITH A REFER-
ENCE TO THE ANTI-TRUST LAWS
OF THE SEVERAL STATES.
INCLUDING ALSO
THE EMPLOYERS' LIABILITY BILL, PURE FOOD BILL, Meat
INSPECTION BILL AND HALL-MARK OR JEWELERS'
LIABILITY BILL.
CONTAINING ALSO INDEX AND TABLE OF CASES
BY WILLIAM L. SNYDER
OF THE NEW YORK BAR
NEW YORK
BAKER, VOORHIS & COMPANY
1906
COPYRIGHT 1906
BY WILLIAM L. SNYDER '
DIB Je / B. S. C.
TABLE OF CONTENTS.
INTRODUCTION.
Federal control.
Railways of the United States
•
Railway legislation prior to 1906
Community of interest among carriers
Need of supplemental legislation
Result of carrier being dealer
Legislation of 1906
•
Results achieved by legislation of 1906
As to free passes
•
Bills of lading compulsory
Coastwise steamships and carriers by water
Imprisonment - Penalty
Imprisonment - Penalty for rebating
Railways not to engage in business
Coal properties controlled by carriers
Power of visitation and supervision
Records of carrier must be uniform
Appraisal of railroad property
•
·
The Chesapeake and Ohio case and Tobacco Trust decisions.
The Tobacco Trust cases
Employers' liability bill
· •
Reclass. 5-6-30 A.Y. M.
Pure food legislation
•
Hall-Mark or Jewelers' liability bill
CHAPTER I.
PAGE.
iii
iv
vi
vii
viii
ix
X
xi
xii
xiv
XV
xviii
xix
XX
xxii
•
XXV
xxvii
xxix
xxxi
xxxiv
xxxvi
xxxix
xxxix
Analysis of Interstate Commerce Act.
SEC. 1. Interstate
3.
carrier
commerce defined Definitions Common
J
- Railroad transportation Charges must be
reasonable Free transportation, when prohibited
Carriers not to deal in commodities transported -
Switches and terminal facilities
1-6
6
2. Rebates prohibited Unjust discrimination defined....
Preferences and advantages-Duty of connecting lines. 6
4. Long and short haul regulations Power of commis-
sion
254076
•
6, 7
3
TABLE OF CONTENTS.
SEO. 5.
6.
Pools and combinations prohibited
Schedule of rates to be published Rates through for-
eign country Change of rates must be on notice
Provision as to joint tariff rates Publication con-
dition precedent — Preference time of war
Elkins Act-Sec. 1. Liability for acts of agents, re-
ceivers, trustees, etc. Rebates Forfeiture of three
times amount as additional penalty
•
PAGE.
7
7-10
.... 10-13
7. Commerce act Continuous carriage from point of ship-
ment to point of destination
8. Liability of carrier in damages
•
•
9. Remedy of shipper in alternative by complaint to com-
mission or suit in Federal court
•
10. Criminal liability of carrier - Criminal liability of car-
rier for false bills, weights or classification Crim-
inal liability of shipper for false weights, bills or clas-
sification — Joint and several liability of shipper and
carrier
13
14
14
14-17
17
11. Interstate Commerce Commission created
12. Commission may prosecute through United States Dis-
trict Attorney — Witnesses
- Witnesses Attendance compulsory
Penalty for disobedience of witness-Testimony
taken by deposition-Deposition, how taken — For-
eign witnesses Fees
—
18-20
13. Complaint to commission, how made — Investigations,
how conducted — Complaints by State Railroad Com-
mission
20
14. Reports and findings of commission shall be evidence.. 20-21
15. Commission may fix rates - When order of commission
16.
takes effect Supplemental order, joint rates — Pay-
ment by carrier for services and instrumentalities.. 21–23
Order for damages, how enforced — Findings of com-
mission prima facie evidence - Damage claims to be
mission prima facie evidence Damage claims to be
filed within two years - Damage claims — Parties
Order, how served, modification or suspension of
Orders, how enforced - Penalties and forfeitures
When orders enforced by injunction - Appeal-Venue
- Provisions as to court review - Schedules
prima facie evidence
16a. Application for rehearing
17.
Procedure before Interstate Commerce Commission
18. Salary of commission
Fees and expenses
19. Sessions of commission, where held
filed
23-28
28, 29
29
29
30
4
TABLE OF CONTENTS.
PAGE.
SEC. 20. Annual reports-Contents-Uniformity-Uniform books
and accounts of carriers, when compulsory — Man-
damus on application of commission or attorney-gen-
eral Bill of lading compulsory - Initial carrier
liable for damages
30-34
21. Commission to make annual reports to Congress..
22. Free or reduced rates Excursions - Mileage
Mileage-Com-
mutation rates - Remedies cumulative
35
35-36
•
23. Remedy by mandamus to move traffic or furnish cars.. 36-37
24. Commerce commission enlarged Salaries Term of
office
Act June 29, 1906. Application of existing laws
Repealer Act to take effect
•
37
37-38
CHAPTER II.
I. Constitutional Limitations — Sumptuary Laws - Police Power.
SEC. 1. Interstate commerce
2.
•
tutes
Interstate commerce
erative as to
3. Interstate commerce
4. Interstate commerce
strued
5. Interstate commerce
ing cars for
•
6. Interstate commerce
State
Original package, what consti-
39
40
42
When State liquor laws not op-
When sale of liquors is not...
Sale of liquors Wilson Act con-
43
State law cannot compel furnish-
44
Taxation
Business within the
45
II. Constitutional Limitations - Immunity.
7. Immunity defined - Immunity statute
8. Immunity under Federal statute
45
Act of Feb. 25, 1903,
tained
11. Immunity - Testimony before grand jury
construed
9. Immunity under State statute
•
10. Immunity Examination before grand jury
12. Immunity does not extend to corporation
13. Immunity from search and seizure extends to corpora-
tion
47
Constitutionality sus-
48
49
50
52
53
•
III. Commerce Act - Elkins Act - Pooling Rebates - Discrimination.
SEC. 14.
Unreasonable rates
Charges based on shippers' profits. 54
15.
Pooling-What constitutes
55
5
10
TABLE OF CONTENTS.
SEC. 16. Pooling
When joint through rate is not
17. Discrimination - When denial of right of shipper to
designate route is not
18.
Rebates Discrimination Freight classification.
19. Discrimination - Transportation of troops
SEC. 20.
•
PAGE.
55
59
•
•
ཚསྐྱ
61
62
IV. Commerce Act Carrier Cannot be a Dealer.
Carriers cannnot deal in commodities which they trans-
port
63
21. Carrier cannot be a dealer — Legislation of 1906 as to.. 68
V. Imprisonment Crimes and Conspiracies.
SER. 22. Imprisonment - Conspiracy against United States
Criminal liability — Rebates Concessions Foreign
shipments
23.
24.
69
73
Criminal liability-Concessions-Overlapping contracts. 75
VI. Commerce Act - Mandamus.
• •
SEC. 25. Mandamus - Effect of new legislation as to
26. Mandamus - Jurisdiction of Federal court as to.
27. Mandamus Writ may fix percentage of cars
•
28. Mandamus - Right to, not affected by contract with
carrier
. 76
77
78
79
34.
VII. Commerce Act― Jurisdiction — Evidence Remedies Procedure.
SEC. 29. Jurisdiction of Federal courts
• ·
30. Jurisdiction acquired only by proper service.
31.
Federal question
·
32. Appeal directly to Supreme Court of the United States
Under Act of February 11, 1903
•
33. Appeal directly to Supreme Court, under Court of Ap-
peal Act of March 3, 1891
Evidence
•
81
83
84
85
86
35.
36.
Documentary evidence under Commerce Act..
Remedies - Orders of commission — Legislation of 1906.
Orders for payment of money Damages
87
87
89
37. Orders for damages, how enforced
92
• •
38. Orders enforced in equity
39.
40. Evidence Burden of proof
prima facie evidence
40a. Burden of proof - Drug Trust
40b. Pleadings under Sherman Act
40c. Assignment of claims Jurisdiction
in Federal court
•
40d. Switches on private land - Injunction
93
Lawfulness of order - How reviewed
94
Findings of commission
94
95
96
Rights of assignor
999
97
99
6
TABLE OF CONTENTS.
VIII. Criminal Trusts Under Sherman Act.
PAGE.
SEC. 41. Jurisdiction - Action pending in State court, when no
bar under Sherman Act
100
42. Municipal corporation may recover damages under
43. Measure of damages under Sherman Act
44. Liability of individual members of trust
•
45. Statute of Limitations applicable to Sherman Act.
46. Beef Trust an unlawful conspiracy under
47. Stock quotations, when not within
48. Sale of steamboats and business of carrier, when not
within Trust When contract of sale of steamboats
101
101
102
•
102
103
•
•
104
is not
105
•
49. Sale of mercantile business and good will, when not
within
106
—>
50. Agreement not to sell goods outside the State, not within
Sherman Act
51. Illegal contract under When not enforceable
107
•
Rights
of parties
108
52. Book Trust
Copyright
Blacklisting void under Sher-
man Act
108
•
53. Book Trust
When owner of copyright can control sale. 110
53a. Patent right will protect trust
110
54. Boycott Conspiracy to boycott restrained by injunc-
tion
111
•
54a. Blacklisting prohibited as to employees of carriers en-
gaged in interstate commerce
113
54b. Injunction proceedings in State court, when forbidden.. 114
IX. State Anti-Trust Laws - Common Law Trusts.
SER. 55. State anti-trust laws
115
•
56. Federal courts cannot punish common-law trusts... 115-118
57. Common law, as to trusts and conspiracies in restraint
of trade
118
•
57a. State anti-trust laws upheld
121
58. Kansas Anti-Trust Law sustained
121
•
59. Missouri Anti-Trust Law - Purchaser relieved in suit by
the trust
123
X. State Anti-Trust Laws Enumerated.
SEC. 60. State anti-trust laws enumerated
126
XI. Telegraph Companies.
SEC. 61. As to right of Eminent Domain Act of July 24, 1866.... 130
7
TABLE OF CONTENTS.
XII. Safety Appliance Law.
SEO. 62. Safety Appliance Law - Automatic couplers, different
types — Liability of carrier to employee
63. Safety Appliance Law-Penalties
Penalties Liability of carrier
for penalty
PAGE.
131
131
CHAPTER III.
New interstate commerce legislation
Employers' Liability Bill
133
134-136
Pure Food Bill
136-144
•
Meat Inspection Bill
144-152
Hall-Mark or Jewelers' Liability Bill
152-157
8
TITLES OF ACTS OF CONGRESS CITED AND
REFERRED TO.
1789. SEPT. 24. AN ACT to establish the Judicial Courts of the
United States.
1875. MARCH 3. AN ACT to determine the jurisdiction of the
Circuit Courts of the United States and to regulate the re-
moval of causes from State Courts and for other purposes.
1886. JUNE 29. AN ACT to legalize the incorporation of Trades
Unions.
1887. FEB. 4. AN ACT to regulate commerce.
1888. AUG. 13. AN ACT to correct the enrollment of An Act ap-
proved March 3, 1887, entitled "An Act to amend sections
1, 2, 3 and 10 of An Act to determine the jurisdiction of
the Circuit Courts of the United States and to regulate the
removal of causes from the State Courts and for other pur-
poses."
1890. JULY 2. AN ACT to protect trade and commerce against un-
lawful restraints and monopolies.
1890. AUG. 8. AN ACT to limit the effect of the regulations of com-
merce between the several states and with foreign countries
in certain cases.
1893. FEB. 11. AN ACT in relation to testimony before the Inter-
state Commerce Commission and in cases or proceedings
under or connected with An Act entitled "An Act to regu-
late commerce," approved February 4, 1887, and amend-
ments thereto.
1893. FEB. 13. AN ACT relating to navigation of vessels, bills-of-
lading and to certain obligations, duties and rights in con-
nection with the carriage of property.
1894. AUG. 27. AN ACT to reduce taxation to provide revenue for
the government and for other purposes. Became a law
without the President's signature.
1898. JUNE 1. AN ACT concerning carriers engaged in interstate
commerce and their employees.
1901. MARCH 3. AN ACT requiring common carriers engaged in in-
terstate commerce to make full reports of all accidents to
the Interstate Commerce Commission.
1903. FEB. 11. AN ACT to expedite the hearing and determination
of suits in equity pending or hereafter brought under the
9
ACTS OF CONGRESS CITED AND REFERRED TO.
act of July 2, 1890, entitled "An Act to protect trade and
commerce against unlawful restraints and monopolies," "An
Act to regulate commerce," approved February 4, 1887, or
any other acts having a like purpose that may be hereafter
enacted.
1903. FEB. 14. AN ACT to establish the department of Commerce
and Labor.
1903. FEB. 19. AN ACT to further regulate commerce with foreign
nations and among the states.
1903. FEB. 25. AN ACT making appropriations for the legislative,
executive and judicial expenses of the government for the
fiscal year ending June 30, 1904, and for other purposes.
1906. JUNE 11. AN ACT relating to liability of common carriers in
the District of Columbia and territories, and common car-
riers engaged in commerce between the states and foreign
nations to their employees.
1906. JUNE 13. AN ACT forbidding the importation, exportation or
carriage in interstate commerce of falsely or spuriously
stamped articles of merchandise made of gold or silver or
their alloys, and for other purposes.
1906. JUNE 19. AN ACT to further protect the public health and
make more effective the national quarantine.
1906. JUNE 28. A BILL to declare the true intent and meaning of
parts of the acts entitled “An Act in relation to testimony
before the Interstate Commerce Commission," and so forth,
approved February 11, 1893, and An Act entitled "An Act
to establish the department of commerce and labor," ap-
proved February 14, 1903, and An Act entitled "An Act to
further regulate commerce with foreign nations and among
the states," approved February 19, 1903, and An Act entitled
"An Act making appropriations for the legislative, execu-
tive and judicial expenses of the government for the fiscal
year ending June 30, 1904, and for other purposes," approved
February 25, 1903.
1906. JUNE 29. AN ACT to amend An Act entitled "An Act to regu-
late commerce," approved February 4, 1887, and all acts
amendatory thereof, and to enlarge the powers of the Inter-
state Commerce Commission.
1906. JUNE 30. AN ACT making appropriations for the Department
of Agriculture for the fiscal year ending June 30, 1907.
1906. JUNE 30. AN ACT for preventing the manufacture, sale, or
transportation of adulterated or misbranded or poisonous or
deleterious foods, drugs, medicines, and liquors, and for
regulating trafic therein, and for other purposes.
10
Table of Cases.
A.
Addyston Pipe Case...
Addyston Pipe Co. v. United States
Allen v. Pullman Co...
Ambler v. Eppinger.
American Express Co. v. Iowa.
•
American Steel & Wire Co. v. Speed..
Andes v. Ely..
•
PAGE.
96
96, xxxii
104
99
41
42
99
112
59
101,
102
63
40
Arthur v. Oaks.
Atchison, Topeka & Santa Fe Ry. Co. v. Interstate Com. Co....56,
Atlanta v. Chattanooga Foundry Co....
Austin v. Tennessee.
•
Attorney-General v. Great Northern Ry. Co...
B.
Bement v. Nat. Harrow Company....
Board of Trade v. Christie Grain & Stock Co.
Bobbs-Merrill Co. v. Straus..
Booth & Co. v. Davis..
•
Bowman v. Chicago & N. Y. Ry. Co.
Brock v. Northwestern Fuel Co.
•
•
Calderon v. Atlas Steamship Co.
Caldwell v. North Carolina..
Caledonian Coal Co. v. Baker.
Canal Co. v. Railroad Co..
•
C.
Chicago Coal Co. v. People...
Chicago-Milwaukee Railroad v. Sabon.
Cincinnati Packet Co. v. Bay
·
City of Atlanta v. Chattanooga Foundry Co...
Clune v. United States...
Commonwealth v. Miskey.
Commonwealth v. Carlisle.
•
Connolly v. Union Sewer Pipe Co..
Cook v. Marshall County.
Crawford v. Neal.
Cross v. Allen...
•
Crutcher v. Kentucky..
•
110, 111
105
• •
109, 110
106, 107
42
99
xvi
42
84
xxvi
120
xvi
85, 106
•
101, 102
71
120
120
124, 125
40
99
99
104
11
TABLE OF CASES.
D.
PAGE.
99
Dodge v. Tully..
F.
Field v. Barber Asphalt Co.
86
Foppiano v. Speed....
42,
43
G.
Georgia Bank Co. v. Smith..
General Electric Co. v. Wise...
Gordon v. Guilford...
Gulf, etc., R. R. Co. v. Ellis.
86
109
100
53
H.
Hadley Dean Plate Glass Co. v. Highland Glass Co.
125
xxxi, 46, 47, 50, 51, 52,
54
iv
xxxiii,
77
108
.44,
45
Hale v. Henkel
Hall v. De Cuir..
Harp v. Choctaw Railroad
•
Harriman v. Northern Securities Co..
Houston & Texas Central Ry. Co. v. Mayes..
I.
Interstate Com. Co. v. Southern Pacific Ry. Co....
Interstate Com. Co. v. Lake Shore & Michigan Ry. Co..
Interstate Com. Co. v. Chesapeake & Ohio R. R. Co.... xxxi, 63,
Interstate Com. Co. v. Baird.
Baird....
In re Hohorst..
•
59
62
66
67, 68,
96
..85,
86
81
Jack 1. Kansas..
Johnson v. Southern Pacific Co.
Kehrer v. Stewart....
v.
King . Morris..
J.
.47, 48,
49
xxxii, 96, 131,
132
K.
Knapp ". Lake Shore Ry. Co....
L.
Lafayette Bridge Co. v. City of Streator.
Leisy v. Hardin
Leloup v. Port of Mobile.
·
Lowe v. California State Federation of Labor.
Loewe v. Lawlor
Lilienthal's Tobacco Co. v. United States.
Loder v. Jayne...
45
119
78
126
42
104
•
•
.111, 11:
83,
100
95
96
12
TABLE OF CASES.
M.
PAGE.
McAllister v. Henkel ..
McCall v. Cincinnati, Indianapolis, etc., Railroad..
xxxi, 46, 47, 50, 51, 52,
54
100
Metcalf v. Watertown.
Mexican Nat. Railroad v. Davidson.
99
.98, 99
Minis v. United States..
Minneapolis & St. Louis Railway v. Pontius
Missouri Pacific Railway v. Mackey
Munn . Illinois...
v.
Montague . Lowry
86
xxxviii
•
Xxxviii
100
•
xxxii, 96
N.
Nat. Cotton Oil Co. v. Texas..
•
Nester . Continental Brewing Co.
•
New Haven R. R. Co. v. Interstate Com. Co..
New Orleans r. Whitney.
•
New York Ry. Co. r. Penn. Refining Co..
Norfolk & Western R. R. Co. t. Simms.
Northern Securities Case.
Northern Securities Co. v. United States.
•
•
0.
121
120
·
.63, 66, 67,
68
888
99
89
42
.96, 97
xxiv, xxx, xxxii, 108
Oman v. Bedford Bowling Green Stone Co...
P.
Pabst Brewing Co. v. Cranshaw.
Pennsylvania v. Wheeling Bridge Co.
People v. Fisher..
People v. Sheldon.
People v. The Milk Exchange.
•
Phillips v. Iola Portland Cement Co.
Plant Investment Co. v. Jacksonville.
·
•
xxxiii, 100, 114
41
116
120
120
120
107
99
Railway Co. v. Gonzalez.
Rhodes v. Iowa...
Rice t. Standard Oil Co.
•
R.
Rubber Tire Wheel Co. v. Milwaukee Rubber Works..
81
42
xxxiii, 96,
97
111
S.
Santa Fe Pacific Ry. Co. v. Interstate Com. Co.
...56,
59
Scribner v. Straus.
110
•
Shoecraft v. Bloxham..
99
Smiley v. Kansas..
123
Southern California Ry. Co. v. Interstate Com. Co.
..56,
59
18
TABLE OF CASES.
Southern Pacific Co. v. Interstate Com. Co.
•
State of Pennsylvania v. Wheeling Bridge Co.
Swift v. United States
T.
•
Tift et al. v. Southern R. R. Co.
Tullis v. Lake Erie & Western Railroad
U.
PAGE.
...56, 59,
61
116
•
97, 103, 104
x, 55, 82, 95
xxxviii
United States ex rel. Interstate Com. Co. v. Seaboard Railroad...
United States ex rel. Kingwood Coal Co. v. West Virginia R. R. Co.
United States ex rel. Greenbrier Coal & Coke Co. v. Norfolk Ry. Co.
United States v. Armour Packing Co. et al.....
United States v. Astoria & Columbia River R. R. Co..
United States v. Barr....
United States v. Chicago, Burlington & Quincy Ry. Co..
United States v. Chicago & Northwestern R. R. Co...
United States v. Coolidge..
•
United States v. Garlinghouse..
United States v. Hudson & Goodwin..
United States v. Lancaster..
United States v. Southern Railway
United States v. Wiltberger..
United States v. Worrall..
•
• •
xvi
78
79
75
63
116
76
62
116
117
116
116
132
116
116
V.
Vance v. Vandercook Co. No. 1.
W.
42
Waters-Pierce Oil Co. v. Texas....
West Virginia R. R. Co. v. United States ex rel. Kingwood Coal
Co...
Western New York Ry. Co. v. Penn. Refining Co.
Western Union Tel. Co. v. Pennsylvania Railroad.
Wheaton v. Peters..
Whitwell v. Continental Tobacco Co...
14
•
121
79
xxxiii,
90
130,
131
116
108
INTRODUCTION.
1
INTRODUCTION
The Fifty-ninth Congress, at its first session, in June,
1906, enacted legislation amending the Interstate Commerce
Act and the Elkins Act, and conferring additional powers
upon the Interstate Commerce Commission. The purpose
of this legislation was to amplify and broaden the scope of
the railroad legislation referred to, so as to protect the in-
terests of the shipper and limit the power of the carrier.
From an economic standpoint this new legislation marks an
era in the history of the republic. It is the beginning
of Federal control of the commerce of the country. It is a
recognition by Congress of the inherent power which resides.
in the Federal government, to regulate and control inter-
state commerce, and of the obligation which rests upon the
government to exercise this sovereign power.
It is a tremendous power. Commerce is one of the chief
concerns of government, because it constitutes the life of the
nation. "Whoever control the trade of the world," said Sir
Walter Raleigh, "commands the riches of the world, and
consequently the world itself." When, therefore, Congress,
exercising the sovereignty conferred upon it by the Con-
stitution, enacts into law wise and salutary rules for the
government of the great transportation companies which
operate the railways of the United States, it must, of neces-
sity, exercise Federal control over the commerce of the
nation, and thereby establish economic conditions of vital
and far-reaching importance, which suggest new problems in
industrial progress.
FEDERAL CONTROL.
The warrant for Federal control of interstate commerce
is written plainly in the Constitution. The power to fix
[iii]
iv
INTRODUCTION.
rates and charges for transportation is an attribute of
sovereignty, because in operating a public highway, a trans-
portation corporation exercises the power of the sovereign.
This power over public highways, constructed for public use,
to accommodate public travel, and secure public convenience,
is a matter of public concern and is absolutely essential to
government. The sovereign cannot surrender this power,
because, like the taxing power, the entire community has an
interest in preserving it undiminished. Two sovereigns can-
not exist in the same jurisdiction. One must be supreme,
and the supreme power must, of necessity, be the Federal
government. And so it was ordained when our fathers wrote
into the Constitution the words declaring that that instru-
ment and the laws made in pursuance thereof "shall be the
supreme law of the land," and in express words subordinated.
the judiciary of the several States by declaring that
judges in every State shall be bound thereby, anything in
the Constitution or laws of any State to the contrary not-
withstanding."
the
...The assumption, therefore, by the Federal government of
this power to control interstate commerce is not an assump-
tion of the power of the States, because this particular power
does not reside in the States, but in the Federal government.
Indeed, before Congress assumed to exercise this power by
enacting the Interstate Commerce Act, Chief Justice WAITE,
in 1877, speaking for the Supreme Court of the United
States, declared that "State legislation which seeks to im-
pose a direct burden upon interstate commerce, or to inter-
fere directly with its freedom, does encroach upon the
exclusive power of Congress.' This doctrine has always
prevailed and must prevail, if Congress is to exercise its
right to regulate interstate commerce.
29 1
RAILWAYS OF THE UNITED STATES.
Our unrivalled railway system, the finest in the world, is
the growth of seventy-five years. In 1830 there were but
twenty-three miles of railroad in operation in the United.
1 Hall v. De Cuir, 95 U. S. 485.
RAILWAYS OF THE UNITED STATES.
V
States. On January 1, 1906, the total trackage was 215,000
miles, exclusive of second, third, and fourth tracks, yards,
and sidings. If these be included, the aggregate will be
300,000 miles of track. The circumference of the earth is
but 25,000 miles. The mileage of railways in the United
States embraces two-thirds of the railway mileage of the
world. The capital of these transportation corporations is
estimated at $13,000,600,000. The aggregate value of their
capital stock represents $6,339,899,000, and, in 1905, their
income from freight and passenger receipts reached the hand-
some total of $5,500,000 per day. Some idea of the colossal
proportions of the freight business alone may be learned
from the fact that an increase of one mill per ton per mile,
on the traffic for the year 1905, would produce $174,522,089.
They employ 1,600,000 men. Their disbursements include
operating expenses, fixed charges, floating indebtedness, im-
provement of road bed, necessary repairs, and dividends.
which may be declared from time to time on the capital
stock. The vast power, exercised by the carriers of the
country, are controlled by a directorate, dominated, it is said,
by about a hundred men.
The principal railways of the United States are under the
control of seven great systems, as follows: (1) The Vander-
bilt System;¹ (2) The Pennsylvania;² (3) The Gould Sys-
tem;³ (4) The Harriman Lines; (5) The Hill System;"
4
1 Comprising New York Central; the Lake Shore & Michigan Southern;
the Michigan Central; the Cleveland, Cincinnati, Chicago & St. Louis ;
the Pittsburg & Lake Erie, and the Erie Railway Company (formerly
New York, Lake Erie & Western).
2 Including the Pennsylvania, and controlling the Baltimore & Ohio;
Chesapeake & Ohio: Norfolk & Western, and holding jointly with the
New York Central a controlling interest in the Philadelphia & Reading.
which latter controls the Central Railroad of New Jersey.
3 Comprising the Wabash; the Missouri Pacific; the St. Louis Iron
Mountain & Southern; the Texas & Pacific; the St. Louis Southwestern ;
the International Great Northern: the Wheeling & Lake Erie; the West
Virginia Central: the Denver & Rio Grande; the Western Maryland,
and now constructing the Western Pacific.
4 Comprising the Union Pacific; Southern Pacific; Central Pacific;
Oregon Short Line: Oregon Railway & Navigation Co., with large
interests in the Illinois Central; the Chicago & Alton, and Kansas City
Southern.
5 Including the Great Northern; the Northern Pacific. and the Chi-
cago, Burlington & Quincy.
vi
INTRODUCTION.
(6) The Rock Island System;¹ and (7) The Southern Rail-
way System.2
These facts give force to the pertinent observation of Hon.
JOHN F. DILLON, speaking of the danger of railway con-
solidation, "that uncontrolled power in a few men by any
form of corporate device, to control the railway systems of
great country, is a power too great to be compatible with
the public weal, and one which would not be permanently
endured by the people."
RAILWAY LEGISLATION PRIOR TO 1906.
The first general law by which Congress assumed to exer-
cise control of commerce among the States and with foreign
nations was approved February 4, 1887, and is known as
the Interstate Commerce Act. It embraced legislation affect-
ing only common carriers, and was supplemented by the
Sherman Act, approved July 2, 1890, which included not
only common carriers, but manufacturers and producers.
The Sherman Act prohibits contracts and agreements of
every kind in restraint of trade and commerce.
This legis-
lation as to carriers was further supplemented by the Elkins
Act, approved February 19, 1903. Two causes contributed
to hinder efficient administration of this railway and anti-
trust legislation. One was occasioned by the unavoidable
delay in reaching the Supreme Court of the United States,
as an appeal in the first instance was to the United States
Circuit Court of Appeals. Another obstacle resulted from
the difficulty of securing evidence to prosecute violations of
the law. To obviate these difficulties Congress passed the
Expediting Act of February 19, 1903, abolishing inter-
mediate appeals to the Circuit Court of Appeals, when the
government was a party, and authorizing an appeal directly
to the Supreme Court, and giving cases so expedited a prefer-
ence over all other litigation, except criminal causes.
In
order to compel witnesses to testify Congress passed several
1 Including the Chicago, Rock Island & Pacific; the St. Louis & San
Francisco; the Chicago & Eastern Illinois, and the Choctaw, Oklahoma
& Gulf.
2 This system controls nearly all the important railways of the South.
POOLING
COMPETITION.
vii
statutes, approved, respectively, February 11, 1893, Febru-
ary 14, 1903, February 19, 1903, and February 25, 1903,
each containing an express provision making the testimony
of the witness compulsory, and securing immunity to the per-
son so testifying, by prohibiting any prosecution of the wit-
ness on account of any matter to which he might be compelled
to testify, except perjury in giving the evidence.
Congress also provided a method of securing information
through an investigating bureau, known as the Bureau of
Corporations in the Department of Commerce and Labor,
created by section 6 of the act approved February 14, 1903,
giving the Commissioner power to investigate "the organiza-
tion, conduct, and management of the business" of corpora-
tions or joint-stock companies engaged in interstate com-
merce. This legislation was designed to promote Federal
control in the field of interstate commerce.
COMMUNITY OF INTEREST among CARRIERS.
The Commerce Act, among other provisions, prohibited
pooling among railroads in order to stimulate competition
among carriers. The consolidation and merger of competing
systems of railway has been condemned by the Supreme Court
of the United States as contrary to law and public policy and
in violation of the Sherman Act. Yet from official data in
the records of the Interstate Commerce Commission, and
from testimony taken before that body from time to time, it
would seem that the railways of the United States are practi-
cally merged and operated under a sort of gentlemen's agree-
ment, which substantially eliminates competition. Mr. Ed-
ward A. Moseley, secretary of the Commission, is authority
for the statement that 65 per cent. of all the railroads in the
country are so closely united as to amount to a practical
community of interest; while the remaining 35 per cent. are
absolutely dependent upon these great consolidations. "Com-
petition," says Mr. Moseley, "between carriers by rail, which
formerly prevailed and acted as a check or restraint again
unreasonable rates, has been to a great extent suppressed and
destroyed. As a result of these consolidations, the shipper
viii
INTRODUCTION.
can no longer safely rely upon competition to insure rates
reasonably low, and to prevent rates unreasonably high. The
principal and powerful lines are now controlled by a few,
whose common interests make it desirable and profitable to
act in concert and refrain from competition."
Other objects sought to be secured by the Commerce Act
originally, and by the legislation of 1906 amending it, were
(1) to give to every shipper equality of opportunity, and
prevent the carrier from charging one man more than an-
other for transportation of property; (2) to forbid one carry-
ing company to combine with another, so that there could be
no merger of public highways, which could only result in
eliminating competition, thus establishing a monopoly;
(3) to compel a carrier to carry, and to prohibit it from
engaging in any other business.
The Interstate Commerce Act was experimental legisla-
tion. Experience has shown that its provisions, even as
amended by the Elkins Act and other supplemental legisla-
tion above referred to, failed to accomplish the benefits which
it was designed to secure.
NEED OF SUPPLEMENTAL LEGISLATION.
One radical defect in the law was its failure to create a
tribunal with power to fix rates and charges for transporta-
tion. When the act was passed the far-reaching conse-
quences of conferring this sovereign power was ably dis-
cussed. Should it remain in the carrier? Should it be
vested in a judicial tribunal or court, clothed with juris-
diction over this particular field, to be known as the Court
of Interstate Commerce (Congress undoubtedly has power to
create such a court), or should supervision be conferred upon
an administrative or quasi-judicial body. The latter ex-
pedient was adopted and the Interstate Commerce Commis-
sion was created with certain specified powers and duties.
The Commission, however, prior to 1906, was not clothed
with power to fix rates and charges for transportation. It
could take testimony as to whether or not a given rate was
reasonable, but if it found that the rate was unreasonable, it
CARRIERS ACTING AS DEALERS.
ix
had no power to prescribe what would be a reasonable rate
in its stead. It could make orders commanding the carrier
to cease and desist from practicing discrimination, or from
continuing to charge an unreasonable rate, or to make repara-
tion for losses sustained. But the orders were not obligatory
until suit was brought by the Commission to enforce them.
Pending the protracted delays which necessarily ensued, dur-
ing which period the acts forbidden by the order were also
prohibited by injunction, the discouraged shipper became
exhausted. He found his business ruined by the acts com-
plained of. He was helpless. As between carrier and ship-
per the latter was practically remediless.
Thus the carrier, with unlimited resources at its com-
mand, has been able to evade the law and defeat the bene-
ficial provisions of the statute, by reason of the lack of power
conferred upon the Interstate Commerce Commission.
RESULT OF CARRIER BEING DEALER.
But graver abuses than rebating and discrimination grew
out of the practice of carriers engaging in business, and deal-
ing in the commodities which they transport. Not only were
shippers discriminated against and driven out of business by
rivals, who, by means of secret rebates, could secure freight
rates much lower than that paid by the competitor, but in
many instances the rival and competitor of the helpless
shipper was the carrier itself, who, contrary to public policy,
was permitted to become a dealer in the very commodities it
transported. A familiar instance of the evils resulting from
the practice of the carrier engaging in business will be found
in the mining regions of Pennsylvania and West Virginia,
where the coal lands were largely absorbed and the coal busi-
ness monopolized by the carrier. By mining and dealing in
coal, the carrier, either directly or through subsidiary com-
panies, found no difficulty in driving its competitors from
the field by refusing them cars and facilities for transporta-
tion, and discriminating against them by secret rebates. The
carrier was also the miner and shipper of coal, and in this
dual capacity was enabled to establish a complete monopoly
X
INTRODUCTION.
and to control absolutely the price of the commodity to the
consumer.
The carrier in the exercise of the tremendous power
which attaches to the control of rates of transportation upon
the public highways was able to make its own markets, and
to establish its own market towns. Communities were de-
stroyed because rates were made lower to certain points at
greater distances than the rates given to localities situated
nearer to the place of the origin of the shipment. This sort
of discrimination frequently destroyed communities, and
built up rival localities, and market points at the expense of
those destroyed. In one instance (the Tift case ¹) the carrier,
under the guise of increased freight charges, took a pro rata
share of the increased profits realized from the business of a
prosperous shipper.
LEGISLATION OF 1906.
He
The President of the United States, Hon. THEODORE
ROOSEVELT, carefully studied the conditions resulting from
the criminal acts of the carriers, and the abuse of their great
powers. He realized the difficulties attending the stupendous
problem, and the far-reaching consequences of conferring
upon some body or tribunal the rate-making power.
aroused public opinion to the importance of the subject, and
the pressing need of a remedy for the evils complained of.
In his annual message to Congress (December, 1905), he
recommended that the power be vested in the Interstate
Commerce Commission, in these memorable words:
"The Interstate Commerce Commission should be vested
with the power, where a given rate has been challenged and
after full hearing found to be unreasonable, to decide, sub-
ject to judicial review, what shall be a reasonable rate to take
its place; the ruling of the Commission to take effect imme-
diately and to obtain, unless and until it is reversed by the
court of review."
Had this recommendation been enacted into law, the rights
of the shipper would have been restored, and the power of
1 Tift v. Southern Ry. Co., 138 Fed. Rep. 753.
RESULTS OF NEW LEGISLATION.
xi
the carrier to exhaust and ruin the shipper by interminable
delay, and to continue to grant rebates, and to exercise un-
reasonable discrimination in its own behalf, would have been
materially checked. The carrier would have been obliged to
obey an order made after a fair trial, and to carry, upon the
terms and conditions prescribed in the act, and to treat all
shippers, similarly situated, alike. The struggle which re-
sulted in Congress over the rate regulation recommended by
the President became memorable. One phase of it was the
strenuous effort to prevent the rate, made by the Commission,
from taking effect immediately. This effort was successful.
The act, passed June 29, 1906, vested in the Interstate Com-
merce Commission power to fix a maximum rate, the order
of the Commission to take effect "within such reason-
able time, not less than thirty days, and continue in force
for such period of time, not exceeding two years, as shall be
prescribed in the order, unless the same shall be suspended
or modified or set aside by the Commission, or be suspended
or set aside by a court of competent jurisdiction."
RESULTS ACHIEVED BY LEGISLATION OF 1906.
Nevertheless, great and lasting results were achieved by
the legislation of 1906. The task of securing efficient reme-
dial legislation was difficult. The law must be just. The
carrier must have reasonable compensation for services ren-
dered. The shipper must be protected absolutely from un-
just discrimination by the carrier. One man must not be
charged more than another for the same service. Facilities
of shipment and instrumentalities of commerce, including
switches and sidings, must be open to all, and none unjustly
excluded from their use. A railroad is a public highway
and cannot, in the nature of things, be operated as a private
way so as to permit its use by those only who are chosen by
the carrier. Such discrimination would make the highway
private. In order to secure these ends, the following pro-
visions, in addition to the power to fix rates, will be found
in the new law:
The Commission is given power, not only to fix rates gen-
xii
INTRODUCTION.
erally, but to prescribe joint through rates, and part rail and
part water rates.
Carriers, that is railroad companies, as distinguished from
pipe-line companies, are expressly forbidden to deal in the
commodities they carry, other than timber and the manu-
factured products thereof. This provision is to go into effect
May 1, 1908.
Private car lines, including those operating refrigerating
and ventilating cars, express companies, and sleeping car
companies are made common carriers. Pipe line companies,
persons and corporations engaged in the transportation of oil
or other commodities, except water, or natural or artificial
gas who transport by means of pipe lines, or partly by pipe
lines and partly by railroad, or partly by pipe lines and
partly by water, are also declared to be common carriers.
Carriers must keep uniform books, which, at all times,
shall be accessible to the Interstate Commerce Commission.
All reports made by carriers to the Commission must be
uniform.
Switches, sidings and terminal facilities may be ordered by
the Commission, and may also be directed to be furnished
by the court by writ of mandamus.
Damages sustained to goods sent over a joint through
route shall be borne by the initial carrier.
An appeal from an order of the Commission fixing a rate,
if sustained by the court below, must be taken directly to the
Supreme Court of the United States, thus abolishing inter-
mediate appeal.
AS TO FREE PASSES.
The law as to free passes, and free transportation, will
require judicial interpretation. Congress in the Act ap-
proved June 29, 1906, enacted new legislation in this regard,
but in so doing did not amend section 22 of the Commerce
Act, which relates exclusively to the subject, but inserted the
new legislation as part of section 1 of the Act. The amending
Act declares" that all laws, and parts of laws in conflict with
the provisions of" the Act of June 29, 1906, are repealed.
So much, and such parts of section 22, therefore, as conflict
FREE PASSES.
xiii
with the provisions of section 1, relating to free transporta-
tion, are repealed. But if the provisions of section 22 do not
directly conflict with the provisions of section 1, in this re-
spect, both sections must stand. Under section 22 carriers
could handle or carry property for the United States, State
or municipal governments free, or at reduced rates. There
is nothing in section 1 which is inconsistent with this pro-
vision. Under section 22, however, free passes could law-
fully be given, only to officers and employees of railroads;
and the principal officers of any railroad company could
exchange free passes or tickets "with other railroad com-
panies for their officers and employees."
The class of persons to whom free passes may issue, after
January 1, 1907, will be no longer confined to the officers and
employees of a railroad company, but may include the officers
and employees of any "common carriers," namely, the officers
and employees of any oil company using pipe lines, any ex-
press company, sleeping car company, or railroad company,
their families, agents, surgeons, physicians, and attorneys-
at-law; and also "witnesses attending any legal investigation
in which the common carrier is interested.” To this class
belongs also persons engaged in religious and charitable work.
A person transacting the business of a common carrier, or
representing it in any capacity, is an agent of the carrier.
Pipe line companies are engaged in refining and selling oil.
Any person or corporation engaged in this business which does
not use a pipe line, can not derive any benefit under the law
which sanctions free transportation; but a competitor using
pipe lines, could secure free transportation for its salesmen,
employees, agents and attorneys. All salesmen or traveling
agents of such persons or corporations, throughout the United
States, would thus be enabled to carry on business free of
charge, so far as transportation for these traveling agents is
concerned. This exemption from charges for transportation,
would give them an advantage in the market over a compet-
itor, which would result in securing to the pipe line company
a monopoly. Free transportation under such circumstances,
would operate as a commercial weapon, equally as formida-
xiv
INTRODUCTION.
ble, as though the carrier gave the pipe line company sub-
stantial rebates aggregating thousands of dollars annually.
An attorney-at-law elected to the legislature, if he did any
work for a common carrier, could ride on an annual pass.
From this standpoint it would seem that all members of the
legislature, State or Federal, who represent common carriers,
could, if they chose, receive milage from the public treasury,
and ride on free passes issued to them by their clients. But
to the legislator who is also the attorney for the car-
riers, this anomaly presents itself. As attorney he would
he lawfully entitled to use the pass; its use by him as a
legislator would be unlawful. If he desires to retain the
pass, he must either relinquish his public office, or decline
to act for the carrier in the exercise of his profession.
The first instance of the results to be anticipated from
the operation of the new law, in this regard, arose in West
Burlington, Iowa, where it happened that all the city
officials were railroad employees and as such were entitled
to passes. As municipal officers, they are prohibited from
receiving free transportation. The passes being considered
more valuable than the official positions, the pass-holders
resigned their municipal offices, in order to avoid any con-
troversy, which might arise as to their right to use the
passes.
BILL OF LADING COMPULSORY.
One of the most important features of the legislation of
1906, is the provision contained in section 20, which makes
it obligatory upon every common carrier not only to give
the shipper a receipt or bill of lading, but which also forbids
the carrier to seek to exempt itself from liability, by con-
ditions, or limitations, which it may see fit to print upon the
receipts or bills of lading which it issues. The statute ex-
pressly declares that the carrier "shall be liable to the
lawful holder" of such receipt or bill of lading, "for any
loss, damage or injury to such property caused by it," or
by a connecting carrier, and provides expressly that " no
contract, receipt, rule or regulation shall exempt such com-
mon carrier," from the liability imposed by the statute.
BILLS OF LADING LAW AS TO VESSELS.
XV
Any uniform bill of lading to be used by common car-
riers, must be free from the limitations and conditions
usually contained in bills of lading and receipts devised for
the purpose of relieving the carriers from liability. It is
customary for the carrier, if the shipper insists, to offer two
bills of lading or receipts, one of which acknowledges the
receipt of the goods, to be carried to a certain place for a
specific rate, and containing a printed stipulation relieving
the carrier from all liability in case the goods are lost or
destroyed. The carrier usually offers to transport the goods
at a trifling reduction in cost of carriage in case such receipt
is given. The ordinary bill of lading, however, usually con-
tains specific exemption clauses, inserted for the benefit of
the carrier.
In order to establish the carrier's liability, and protect
the public from uni-lateral contracts containing conditions.
which must result in a law suit, in case the shipper seeks
redress for property lost or destroyed, while in the custody
of the carrier, Congress, under section 20 of the Commerce
Act, has established a uniform rule governing tills of lading
in all interstate transactions.
COASTWISE STEAMSHIPS AND CARRIERS BY WATER.
Owners of vessels, including coastwise steamships and
vessels bound for foreign ports, are not within the Com-
merce Act, and are not bound by its provisions, unless they
operate a railroad or a pipe-line in conjunction with the
vessels. Such owners are common carriers by virtue of their
employment. But the statute is made applicable only to
carriers engaged in the transportation of passengers or
property, “wholly by railroad, or partly by railroad and
partly by water when both are used under a common con-
trol, management, or arrangement for a continuous carriage
or shipment." In defining these words, the courts have held
that an agreement among carriers to transport property over
a number of lines, at a fixed through rate, and agree among
themselves expressly, or by implication to a division of the
charges, such a transaction will constitute a common ar-
(6
xvi
INTRODUCTION.
rangement for a continuous carriage or shipment" within
the meaning of the statute.¹
Carriers by water, however, who are not within the stat-
ute, so far as the conditions in bills of lading are concerned,
are governed by the provisions of an act approved February
13, 1893, known as the Harter Act, entitled "An act relating
to navigation of vessels, bills of lading, and to certain obliga-
tions, duties, and rights, in connection with the carriage of
property." This statute forbids the insertion of clauses in
bills of lading or receipts purporting to relieve the carrier
from liability, and limits the liability of carriers "trans-
porting merchandise or property to or from any port of the
United States of America," upon certain conditions.
Except as modified by statute, there is no distinction be-
tween the liability of a carrier by land and a carrier by
water. Both are common carriers by virtue of their employ-
ment, and whenever they undertake such employment their
liability attaches. In the case of a carrier by water, who
receives no franchise, and conducts business in an enrolled
or licensed vessel, plying the ocean, which is the great high-
way of nations, his liability and the liability of his vessel
attaches when the lien for freight attaches. Under a con-
tract of affreightment the ship and cargo have reciprocal
rights, each having a lien against the other to enforce these
rights. The elements of such a contract are that the ship is
seaworthy, including competent officers and crew, and prop-
erly provisioned, in order to carry and deliver the cargo,
and to properly navigate the ship without needless delay or
deviation. The rule defining a ship-owner's liability is
clearly stated by Mr. Justice BROWN2 as follows:
Any contract by which a common carrier of goods or
passengers, undertakes to exempt himself from all responsi-
bility for loss or damage, arising from the negligence of
himself or servants is void as against public policy, as at-
tempting to put off the essential duties resting upon every
public carrier by virtue of his employment, and as tending
¹U. S. ex rel. Interstate Com. Co. v. Seaboard Railroad, 82 Fed. R. 563.
'Calderon v. Atlas Steamship Company, 170 U. S. 272, citing from Chicago,
Milwaukee Railway v. Sabon, 169 U. S. 133
THE HARTER ACT.
xvii
to defeat the fundamental principle upon which the law of
common carriers was established."
This fundamental principle, referred to by Mr. Justice
BROWN, is, that every common carrier, by reason of the
nature of his employment, is liable to the shipper for every
misfortune, save only the act of God, and the public enemy.
The carrier can not relieve himself from such liability unless
by an express contract based upon a valuable consideration
moving to the shipper. A bill of lading is a uni-lateral con-
tract, and in maritime law differs materially from a charter
party, which is in the nature of a lease of the vessel and
must be signed by both parties.
Under the Harter Act, above referred to, clauses in bills
of lading given by the manager, agent, master, or owner of
any vessel transporting merchandise or property from or
between ports of the United States and foreign ports, pur-
porting to relieve the carrier from liability from negligence
are prohibited. In like manner also, carriers are forbidden
to insert clauses in bills of lading purporting to relieve them
from liability for failure "to exercise due diligence, prop-
erly equip, man, provision, and outfit said vessel, and to
make said vessel seaworthy, and capable of performing her
intended voyage," or to relieve from liability for failure "to
carefully handle and stow her cargo, and to care for and
properly deliver same." The Harter Act, section 3, also
limits the liability of carriers transporting merchandise to
or from ports in the United States, as follows:
"That if the owner of any vessel transporting merchan-
dise or property to or from any port in the United States of
America shall exercise due diligence to make the said ves-
sel in all respects seaworthy and properly manned, equipped,
and supplied, neither the vessel, her owner or owners, agent
or charterers, shall become or be held responsible for dam-
age or loss resulting from faults or errors in navigation or in
the management of said vessel nor shall the vessel, her
owner or owners, charterers, agent, or master be held liable
for losses arising from dangers of the sea or other navigable
waters, acts of God, or public enemies, or the inherent de-
fect, quality, or vice of the thing carried, or from insuffi-
ii
xviii
INTRODUCTION.
ciency of package or seizure under legal process, or for loss
resulting from any act or omission of the shipper or owner
of the goods, his agent or representative, or from saving or
attempting to save life or property at sea, or from any
deviation in rendering such service."
IMPRISONMENT PENALTY.
Failure to restore the imprisonment penalty, as it existed
originally in the Commerce Act, constitutes also, a notable
defect in the legislation of 1906.
The efficiency of the act was greatly impaired by
abolishing this penalty. This was accomplished by the
Elkins Act, approved February 19, 1903, which de-
clared that "no penalty shall be imposed on the con-
victed party other than the fine prescribed by law;
imprisonment, wherever now prescribed as part of the pen-
alty being hereby abolished." This provision was made ex-
pressly applicable to the Commerce Act, to which the Elkins
Act was a supplement, and rendered the Commerce Act
practically harmless. The latter act, as originally passed,
made imprisonment the penalty for any and every violation
of its provisions. Section 6 of the act declared that a writ
of mandamus should issue to compel the carrier to file
schedules of its rates and tariffs, and provided that failure
to comply with the writ might be punished as a contempt of
court. Under contempt proceedings the court has power to
imprison the offender as part of the penalty imposed.
tion 10 declared that any one guilty of "an unlawful dis-
crimination in rates, fares, or charges for the transportation
of passengers or property " should be liable to imprisonment
in addition to the fine prescribed, for a term not exceeding
two years, or to both fine and imprisonment, in the discretion
of the court. Section 10 further provided that any one
guilty of aiding a shipper to obtain transportation for prop-
erty at less than the published rate, which was declared to be
the only legal rate, "by means of false billing, false classifi-
cation, false weighing, or false report of weight, or by any
other device or means," was guilty of a misdemeanor,
Sec-
IMPRISONMENT.
xix
punishable by either fine or imprisonment, or by both fine
and imprisonment, in the discretion of the court.
These penal provisions rendered the Commerce Act avail-
able as a partial remedy for the evils it was designed to
correct, notwithstanding the many difficulties attending its
enforcement. But when these penalties, which would de-
prive the offender of liberty, were eliminated, the act became
of practically little value. Convictions under it were rare
and the cash fine for which the offender became liable, in case
he was obliged to pay, still left large profits to the credit of
the trusts and combinations who succeeded in getting rates
which destroyed competition and eliminated the competitor
as a rival in the commercial world.
IMPRISONMENT PENALTY FOR REBATING.
The imprisonment penalty has not been restored by the
Act of June 29, 1906, except in so far as relates to the crime
of rebating. One who knowingly accepts or receives any
"rebate, concession, or discrimination" may, in addition
to the fine imposed, be punished by imprisonment in the
penitentiary for a term of two years, or by both fine and
imprisonment, in the discretion of the court. To this extent
the punishment by imprisonment has been incorporated in
the Elkins Act, and restored to the Commerce Act. The
language of the amendment in this regard, however, is so
framed that it will be impossible to make it applicable to
false billing, false classification, false weighing, or false
reports of weight, or for failure on the part of the carrier
to comply with the provisions relating to filing and post-
ing schedules of rates and tariffs, and keeping the same
posted; or for giving free passes, or free transportation.
In this connection the conclusion is warranted that it
was not the intention of Congress to restore the imprison-
ment penalty to the Commerce Act, and to incorporate
such penalty in the Elkins Act. The argument is un-
answerable that, if such had been the intention of the
Legislature, it would have simply re-enacted section 10 of
XX.
INTRODUCTION.
the Commerce Act to read as it was enacted originally, in
addition to the amendment of section 1 of the Elkins Act,
and also to have declared that failure to comply with the
requirements of a writ of mandamus, should be punishable
as for a contempt of court.
The court, doubtless, has power to impose such remedy
where a mandamus issues, as the writ is a direct mandate
issued by the court. But no question on this point could
possibly arise had the original provisions of the statute been
restored.
RAILWAYS NOT TO ENGAGE IN BUSINESS.
The legislation which declares that railroad companies,
after May 1, 1908, shall cease to mine and sell coal or any
other commodity manufactured, mined, or produced by the
carrier, or under its authority, or in which it may own, in
whole or in part, or in any way have any interest, direct or
indirect, other than timber and the manufactured products
thereof, will create a commercial revolution. It means that
the carrier may, perhaps, remain in the lumber business in
addition to performing its public duties as carrier, but other
commercial enterprises of every nature can no longer be law-
fully carried on by them. Congress, in enacting this legisla-
tion, assumed that sound public policy required that the car-
rier must give its undivided attention to the performance of
those public duties which it is chartered to perform. If the
carrier should be permitted to engage in any private business,
as a manufacturer and dealer in commodities, which com-
modities it must also carry, it must compete with its own
customers, who are obliged to patronize it as shippers. It is
obvious that the carrier cannot, as a dealer, enter into suc-
cessful competition with its shippers, who are also dealers,
without discriminating against them in the matter of rates
and in furnishing facilities for transportation. The public
duty of the carrier, comes directly in conflict with the private
interest of the carrier in its capacity as dealer. The public
duty and the private interest are incompatible and repugnant
to each other. Both relations cannot be sustained simul-
taneously by the carrier. Either the public duty must yield
CARRIER NOT TO BE DEALER.
xxi
to private interest, or there can be no successful competition,
in this regard, with rivals in the same line of business.
When the carrier is also a dealer, the fact that it carries
its own goods in competition with those shipped by a com-
petitor would ordinarily be prima facie evidence that dis-
crimination has been practiced against the rival, because the
carrier has the absolute power to transport its goods at actual
cost of freightage.
The result of the practice of carriers engaging also in
private business, which does not involve a public duty, has
resulted in creating monopolies, giving them control of many
commodities, notably of oil, beef, sugar, coffee, salt, iron ore,
and coal. In the States of Pennsylvania and West Virginia the
carriers are engaged in mining and shipping coal, and are
the principal dealers in that commodity. In Pennsylvania
they have conducted this business in defiance of the Constitu-
tion of the State, which expressly forbids the carrier to
engage in the business of mining and selling that commodity,
or engaging in any business other than that for which it was
chartered. The provisions of the Constitution, adopted in
1874, in this regard, are as follows:
66
No incorporation company doing the business of a com-
mon carrier shall, directly or indirectly, prosecute or engage
in mining or manufacturing articles for transportation over
its works; nor shall such company, directly or indirectly,
engage in any other business than that of common carrier,
or hold or acquire lands, freehold or leasehold, directly or
indirectly, except such as shall be necessary for carrying on
its business; but any mining or manufacturing company may
carry the products of its mines and manufacturies on its rail-
road or canal, not exceeding fifty miles in length." Const.,
Art. 17, § 5.
66
No corporation shall engage in any business other than
that expressly authorized in its charter, nor shall it take and
hold any real estate except such as may be necessary and
proper for its legitimate business." Const., Art. 16, § 5.
But notwithstanding this constitutional prohibition the
railroads which penetrate the coal regions of Pennsylvania,
control the business and fix the price, from time to time, of
that prime necessity of life.
xxii
INTRODUCTION.
Now that Congress has directed the railroads to abandon
the coal business, in so far as it relates to interstate commerce,
can they justly complain, in view of the fact that they have
carried it on for more than thirty years in direct violation
of the Constitution of Pennsylvania, and the laws of the
Commonwealth? Is it "commercial lynch law" on the part
of the government to prohibit the practice, or is it not rather
"commercial lynch law" on the part of the carrier to con-
tinue the business in defiance of law?
COAL PROPERTIES CONTROLLED BY CARRIERS.
The anthracite coal properties of the carriers in Pennsyl-
vania are exceedingly valuable, worth hundreds of millions
of dollars.¹ In order to obey the law, therefore, the rail-
roads must shift the ownership of these properties, let go
the profits of the business, the control of the coal trade, and
the power to control the output of the mines, and the price
to the consumer. Will this change work legal injustice? On
the contrary, the carriers and their stockholders will be bene-
fitted, because the railroads will continue to carry the coal
as they always did, but they will get the tariff rates of freight
on every ton transported, and this will inure to the benefit
of the stockholders, because the rebates which formerly found
their way into the pockets of the subsidiary companies, con-
trolled by the carriers, being no longer diverted, will flow
directly into the treasury of the railroad company and will
materially increase the earnings of the carrier. The
merchant can once more engage in the coal business, because
his principal rival and competitor, the railroad, acting in the
1 Their value can be estimated by reference to the amount of bond,
stock and certificates of indebtedness issued by the holding companies,
having custody of the various properties held by them as representatives
of the carriers. The Philadelphia North American, in July, 1906, pub-
lished a summary of these values, as follows:
The Reading, represented by the Philadelphia & Reading
Coal & Iron Co.:
Capital stock of holding company
Sinking fund loan
Reading Co. advance
•
$8,000,000
1,320,000
79,135,760
$88,455.760
CARRIERS CONTROL OF COAL PROPERTIES.
xxiii
interest of its subordinate corporations, can no longer de-
stroy his business by discriminating against him, either as
to rates, or as to furnishing cars, or as to the use of terminal
facilities. The net result will benefit the stockholder of the
carrier by directly increasing its earning capacity. It will
benefit the public and the consumer by destroying the coal
monopoly. It will open the entire field of mining and selling
coal to any capitalist or operator who may choose to engage
in the business; develop new properties, and open new
mines and new industries, and give the commercial world
an impetus not dreamed of under present conditions.
The value of these coal lands, however, is too great to
permit of the presumption that the carrier will divorce
absolutely the business of carrier from that of miner and
dealer, until they have received from the Supreme Court of
the United States an interpretation of the statute. Some
may seek to accomplish indirectly that which they cannot
The Lehigh Valley, represented by Cox Brothers & Co.:
Purchase-money bonds
•
$19,000,000
Lehigh Valley Coal Co. stock
1,965,000
Lehigh Valley Coal Co. bonds
12,968,000
Lehigh Valley Coal Co. certificates of indebtedness to
railroad company
10,537,000
$44,470,000
The Erie, represented by Pennsylvania Coal properties,
cost
$37,000,000
Hillsdale Coal & Iron Co., stock
1,000,000
Blossburg Coal Co., stock
1,000,000
•
$39,000,000
The New Jersey Central, represented by Lehigh & Wilkes-
barre Coal Co.:
Capital stock of holding company
Lehigh & Wilkesbarre Coal Co., bonds
•
$9,212,500
26,053,339
$35,265,839
The Delaware & Lackawanna R. R. owns directly its coal
companies, claims right under its charter:
Estimated value of Anthracite properties
$25,000,000
The Delaware & Hudson, claims same as Lackawanna:
Estimated value of unmined coal
$12,600,000
Coal department equipment, mining plant and advances.
2,500,000
$15,100,000
xxiv
INTRODUCTION.
lawfully do directly. The language of the prohibition is
that the carrier shall not have any interest in business other
than that of carrier, either "direct or indirect." How far
the language of ancient charters will serve in this connection
remains to be seen. If a holding company is formed to
take over the coal properties of the carrier, will the trans-
action be held to be within the statute, as was the case of the
holding company, which was resorted to, as a device to evade
the provisions of the Sherman Act, in the Northern Securi-
ties case.¹ That transaction was an attempt to consolidate
the property of carriers, to be operated by carriers.
Some of the carriers have declared that they purposed to
abandon the business of miner and dealer in coal. In July,
1906, a corporation was organized with a capital of $8,000,-
000, known as the Pennsylvania, Beech Creek and Eastern
Coal Company. This company was created for the purpose
of mining and selling bituminous coal. It has negotiated
for the control of a number of properties heretofore operated
in the interest of the carriers, and has acquired, under a 999
year lease, mining properties from the Pennsylvania Coal
and Coke Company, the Webster Coal and Coke Company,
and the North River Coal and Wharf Company.
The Ontario & Western:
Elk Hill Coal & Iron Co. bonds
Scranton Coal Co. bonds
•
The Lehigh Coal & Navigation Company claims an invest-
ment in anthracite property of
·
Valued on basis of Delaware & Hudson basis, the value of
the investment would be $35,000,000; on Reading basis,
the value would be about half that amount.
The Pennsylvania R. R. Co., represented by Susquehanna
Coal Co.:
Susquehanna Coal Co. stock
Susquehanna Coal Co. bonds
•
Manor Hill, real estate, stock and bonds.
Stock of other minor companies
$5,375,000
3,020,000
$8,395,000
$500,000,000
•
$2,136,800
1,355,000
2,250,000
125,000
$5,866,800
1 Northern Securities Co. v. United States, 193 U. S. 197.
FEDERAL CONTROL.
XXV
POWER OF VISITATION AND SUPERVISION.
Of far-reaching importance also are the amendments to
section 20 of the Commerce Act. If the requirements of
this section, as amended, are faithfully complied with, evi-
dence as to how the business of the carrier is conducted, the
amount of its gross earnings, and its net earnings, the detail
of its receipts and expenditures, in what manner soever re-
ceived or incurred, will be preserved in convenient form,
readily accessible to the government as well as to the stock-
holder and the general public. These details and official
data, including reports of all accidents, are required to be
put in the form of reports, which, when filed, become official
documents and may be used in evidence in any Federal court.
In requiring the carrier to furnish these minute details
of all interstate business the government exercises the power
to visit the corporation engaged in such business, which
power is inherent in the sovereign and has always existed
among civilized nations. Speaking of this power, Sir WIL-
LIAM BLACKSTONE, the most distinguished commentator of
the common law of England, observes that "the general
duties of all bodies politic, considered in their corporate
capacity, may, like those of natural persons be reduced to
this single one, that of acting up to the end or design, what-
ever it be, for which they were created by their founder."
In this terse sentence BLACKSTONE has admirably stated
the reason and philosophy which underlies the rule of law
giving to the founder of every corporation power to visit
it. Corporations, though artificial bodies, are composed of
individuals, and like individuals are subject to human frail-
ties and are liable to abuse their powers and franchises and
deviate from the performance of those duties with which
they have been entrusted, and in the exercise of which carry-
ing corporations exercise the attributes of sovereignty. The
sovereign, therefore, as founder has wisely provided proper
persons to visit, inquire into, and correct all irregularities
that arise, and for which the corporation is responsible.
At the common law the king was the founder of all civil
corporations, and his prerogative in regard to the power of
xxvi
INTRODUCTION.
visitation was exercised through his majesty's Court of
King's Bench. The power of visitation includes the right to
inflict the extreme penalty of civil death upon the corporation
by a decree dissolving it. Forfeiture of a corporate char-
ter might be for negligence or abuse of its franchises in
which cases "the law judges that the body politic has broken
the condition upon which it was incorporated." The same
principle applies in the United States to corporations created
by an act of the Legislature. Of these the founder is the
Commonwealth.
1
Strictly speaking the Federal government is not the
founder of corporations chartered under State laws. Few
of them have Federal charters.2 But the fact that a carrying
company receives its franchise from the State is not material
because, when the carrier assumes to exercise its franchise
in connection with interstate commerce, it can do so only
in subordination to the power of Congress to regulate such
commerce. The carrier when doing interstate business be-
comes subject to a dual sovereignty, and the Federal govern-
ment possesses the same right to compel obedience to Federal
laws, as the State has to enforce obedience to its laws with
respect to domestic or internal commerce, within the borders
of the State. The power of the Federal government in re-
spect to an act of Congress relating to interstate commerce
is supreme, and may be exercised as if the corporation were
chartered by Federal authority.
The power of Congress, therefore, to regulate interstate
commerce includes the power to create a body with inquisi-
torial powers which are analogous to the power of visitation
exercised in England by the crown through the Court of
King's Bench as founder of all corporations receiving char-
1 Canal Co. v. Railroad Co., 4 Gill & Johns.
2 The Union Pacific Railroad received aid and grants of land from the
United States. Congress has declared that the books, records, and cor-
respondence, and all other documents of the company "shall at all
times be open to inspection by the Secretary of the Treasury, or such
persons as he may delegate" and has forbidden the company to declare
dividends other than from net earnings, or to issue new stock or securi-
ties of any kind without leave of Congress, except to fund its debt then
existing. U. S. Rev. Stat., Sec. 5256, Act March 3, 1873, Chap. 226,
Sec. 4.
UNIFORM BOOKS.
xxvii
In the case of
ters from the king or the Parliament.
national banks, this power is conferred upon the banking
department and is exercised through the bank examiner.
As to carriers the power is vested in the Interstate Com-
merce Commission supplemented by the aid of the Bureau of
Corporations in the Department of Commerce and Labor.
RECORDS OF CARRIER MUST BE UNIFORM.
Under section 20 of the Commerce Act the Commission
has power to prescribe the form of all accounts, records, and
memoranda to be kept by carriers, including details as to the
movement of traffic and of all receipts and expenditures.
The carrier is forbidden to keep any accounts other than
those prescribed by the Commission. False entries in books
and records, the mutilation of books or records, falsification
of any records, failure to keep true and correct books or cor-
rect entries, or to keep books or accounts other than those
prescribed by the Commission, or a refusal to submit them to
the examiner for inspection is declared to be a misdemeanor.
The Commission may employ special agents or examiners, to
examine all records of the carrier, with power to administer
oaths, examine witnesses, and receive evidence.
The primary objects of the Commerce Act, as has been
observed, is to abolish rebates, false billing, false weights,
false classification of freights, and all sorts of discrimina-
tion. The object of requiring but one set of books was to
render accessible evidence of any violations of law in this
respect, upon the theory that with all books open to the in-
spection of a government expert examiner, it would be well-
nigh impossible to conceal such violations, as a record of
every transaction must be kept; and to alter, mutilate, or
conceal any entry is declared to be a crime.
The carrier, in the absence of these requirements, might
be able to baffle an investigation of its affairs through an
ingenious system of bookkeeping. What part of the dis-
bursements of the carrier should be charged to capital ac-
count? How is the stockholder to know, or how is the shipper
to know, or how is the Commission to know what constitutes
xxviii
INTRODUCTION.
a reasonable rate for freight charges, if income which should
be used for operating expenses is used for something else?
Expenses which should be charged to capital account might
be charged to operating expenses, or might be credited to
a fund used to liquidate damage suits incurred by the carrier
in killing and maiming passengers and employees, for
thousands are killed and maimed by the carrier every year.
The bookkeeping problem also bears directly upon the
accuracy of schedules of rates and charges, required to be
kept and posted, so that rebates cannot be hidden by manipu-
lating these schedules, as has been done frequently and suc-
cessfully. Mr. ALPHEUS B. STICKNEY, President of the Chi-
cago and Great Western railroad, is perhaps as well qualified
as any one to enlighten the public on this phase of the rail-
road problem. Mr. STICKNEY heartily approves of a rigid
compliance with the requirements of the Commerce Act in
this regard.
"In order to furnish this information," says Mr. STICKNEY,
"the tariffs must be published in such a way that a man of
ordinary understanding can tell what the rate is. Now the
tariffs are published in a private cipher, which no one save
the expert clerk who has immediate charge of this business.
can understand. The tariff managers and the freight agents
cannot find the rates in their tariffs. Every officer must have
what is called a tariff clerk who keeps track of the tariff
amendments, and when it is desired to know what the rate
is, he is called upon for information.
"As an illustration, suppose a tariff is made upon a certain
commodity. The tariff is modified by an amendment. An-
other amendment may follow. Then a circular will be issued
which further modifies the rate. Thus the stream of sched-
ules grows in volume until there are more than 2,500,000
tariffs filed in the office of the Interstate Commerce Com-
mission.
"An example of the effect of the modification of tariffs is
found in the way in which the Standard Oil Company se-
cured lower rates for its shipments from Whiting, Ind., to
East St. Louis, than did its independent competitors. The
APPRAISAL OF RAILWAY PROPERTY.
xxix
railroads in Illinois published a tariff between Chicago and
East St. Louis, both places being within the State. Then
they published a little circular saying the rates between
Chicago and East St. Louis applied between Whiting, Ind.,
and East St. Louis. This circular was filed with the Inter-
state Commerce Commission. Nobody knew what it meant.
The Illinois tariff contained some very low rates on oil and
its products. The circular was sent to the Standard, and it
secured the advantage through the ignorance of its rivals.'
The recommendation of Mr. STICKNEY to cure this evil, was
a suggestion that the Commission should refuse to permit
amendments to schedules, or permit them to be filed. As it
would be impossible to go around to every station and change
the tariffs to conform to the amendment, the only practical
way is to reprint the whole tariff, and let the carrier give
more permanency to its rates, to prevent constant changes,
in order that a shipper may be reasonably certain what
freight rates will be when he intends to ship goods to be
manufactured, perhaps six months after he receives an order
for them.
APPRAISAL OF RAILROAD PROPERTY.
The inquisitorial power now conferred upon the Inter-
state Commerce Commission, under section 20, coupled with
the duty imposed upon it by section 15 of the Commerce
Act, which requires that body to fix rates and charges of
transportation, and "to determine and prescribe what will
be the just and reasonable rate," is broad enough, it would
seem, to enable the Commission to appraise and value the
railroad properties of the United States. Indeed, this task
has been assumed, and Professor HENRY C. ADAMS, the
statistician of the Commission, has been selected by it to
aid in that delicate and important duty, by far the most
important phase of the railroad problem. In order to fix
the amount of rates and charges, it is essential to ascer-
tain the amount of capital actually invested in construct-
ing, equipping, and operating the railway. A rate to be
just must yield a fair return on the capital invested.
How much capital has been invested? From official data
XXX
INTRODUCTION.
gathered by the Commission, from time to time, the car-
riers claim that the railroads of the United States are
capitalized at about $13,000,000,000, and are worth that
amount. How much of this vast sum represents money
actually invested; how much is based upon no consideration
whatever, and represents what is ordinarily designated as
water? It is a matter of common knowledge that mergers and
reorganizations of railroad properties usually result in large
bonuses, represented by stock, and sometimes bonds, issued by
the new corporation, which are merely gifts. But they find
their way into the hands of innocent holders. Upon these
fictitious securities the carrier must pay dividends, which
must be taken from the earnings, and these earnings repre-
scnt the money which is paid for freight and transportation
by merchants and the traveling public. An illustration of
the vast amount of securities of this character will be
revealed by an examination of the Northern Securities case,
in which the defendants sought, by a merger agreement, to
consolidate competing lines of railway between the Great
Lakes and the Pacific ocean. Had the transaction been legal-
ized, the projectors of the plan would have received $122,-
000,000 of watered stock. The earnings of the consolidated
companies was the only source from which the money could
be realized with which to pay the dividends, not only on the
capital actually invested in the properties, but in addition,
upon the $122,000,000 which was issued as a bonus to mem-
bers of the syndicate. The payment of these dividends,
therefore, would have cast an additional burden upon the
shipper and consumer, for there is and can be no other source
from which the revenues of the carrier can be derived with
which to pay them.
1
In justice to the shipper and consumer, it is obvious, that
a reasonable rate of transportation of persons and property
must be based on knowledge of the amount of capital in-
vested in railway properties. This fact, when known, will
form the only true basis upon which to estimate what will
be a just and fair compensation to the carrier in return for
the services it renders.
1 Northern Securities Co. v. United States, 193 U. S. 197.
TWO IMPORTANT DECISIONS.
xxxi
But, notwithstanding its manifold defects, the railway
legislation of 1906 will shed new lustre on the administration
of Mr. ROOSEVELT, who is entitled to the credit of its epact-
ment, and will add to his great reputation.
THE CHESAPEAKE AND OHIO CASE AND TOBACCO TRUST
DECISIONS.
The efficiency of railroad and anti-trust legislation has
been immeasurably strengthened by two notable decisions
made by the Supreme Court of the United States in Febru-
ary, 1906, a short time previous to the legislation amending
the Commerce Act and the Elkins Act. These deliverances
were made in what are known as the Chesapeake and Ohio
case,¹ and the Tobacco Trust cases.2 In the former the court
established two new principles; first, as to the rule of con-
struction to be applied in administering the Commerce Act;
second, the wholesome doctrine, that to permit a carrier to
engage in business other than that of carrier in commodities
transported by it, is contrary to public policy, and that con-
tracts in violation of that rule, entered into by carriers, are
void. This principle has been enacted into law, and is em-
bodied in section 1 of the Commerce Act by the act approved
June 29, 1906.
The rule of construction is based upon the assumption that
the Commerce Act, when invoked in civil actions or when
injunctive relief is sought, is remedial and not penal legis-
lation. Aside from its penal aspect, it is a remedial statute,
and should be construed and interpreted liberally to secure
the beneficial purposes for which it was designed, and in aid
of those for whose benefit the law was enacted. In this con-
nection Mr. Justice WHITE, speaking for every member of
the court, said:
"It cannot be challenged that the great purpose of the act
to regulate commerce, whilst seeking to prevent unjust and
unreasonable rates, was to secure equality of rates as to all
and to destroy favoritism, these last being accomplished by
1 Interstate Com. Co. v. Chesapeake & Ohio R. R. Co., 200 U. S. 261.
2 Hale v. Henkel, 201 U. S. 43; McAllister v. Henkel, 201 U. S. 61.
xxxii
INTRODUCTION.
requiring the publication of tariffs and by prohibiting secret
departures from such tariffs, and forbidding rebates, prefer-
ences, and all other forms of undue discrimination. To this
extent and for these purposes the statute is remedial, and is,
therefore, entitled to receive that interpretation which reason-
ably accomplishes the great public purpose which it was
enacted to subserve."
4
2
This rule of construction is applicable also to the Sherman
Act, in view of the decisions of the Supreme Court in the
Northern Securities case,¹ the Addyston Pipe case, the
Montague case,³ and in the Johnson case, all brought under
the Sherman Act except the last named. In the authority
first cited the court went to the merits of the controversy,
disregarding entirely technical objections. It revealed the
heart of the conspiracy charged, and declared that the hold-
ing company was created to take over the stock of the com-
peting lines of railway comprised in the merger, thus creating
a monopoly, which extinguished competition in the transpor-
tation of persons and property from the Great Lakes to the
Pacific ocean, and that the holding company was a mere
device to cover the unlawful combination. It was a scheme
by which the parties sought to do by indirection that which
was directly and expressly forbidden. The court considered
the Sherman Act a remedial statute, in applying the remedy
which it was designed to secure. It considered the real
nature of the transaction which resulted in the merger and
inquired into the purposes sought to be accomplished thereby.
The same thing can be said of the Addyston Pipe case and
the Montague case.
In the Johnson case the court construed the Safety Appli-
ance Law, approved March 2, 1893, which was enacted to
promote the safety of employees and travelers upon rail-
roads. The carrier claimed that it was a penal statute and
must be strictly construed. The Supreme Court refused to
adopt this view. On this point, the court, by Chief Justice
1 Northern Securities Co. v. United States, 193 U. S. 197.
2 Addyston Pipe Co. v. United States, 175 U. S. 211.
3 Montague v. Lowry, 193 U. S. 35.
4 Johnson v. Southern Pacific R. R. Co., 196 U. S. 1.
CHESAPEAKE AND OHIO CASE.
xxxiii
FULLER, reversing the Circuit Court of Appeals, said that
the object of the Legislature in enacting the law was to pro-
tect the lives and limbs of employees and passengers. The
legislative intent was to promote the public welfare and
secure safety. The evil sought to be remedied was the risk
arising from the necessity of going between cars in coupling
and uncoupling them; and that while with respect to suits
to recover the penalties and forfeitures provided by the act,
it might be construed as penal, yet where it was invoked to
secure the remedy, it was a remedial statute.
"The design
to give relief," said the chief justice, "was more dominant
than to inflict punishment."
The value of this rule of construction is apparent, in view
of the cases in which the shipper has been defeated in the
attempt to secure the benefits which the law was designed to
secure to him. The ruling of the lower courts, in some cases,
was based upon a narrow and technical construction of the
statute. The shipper was defeated and thrown out of court
upon technicalities, and the merits of his case were lost sight
of in order to promote some technical rule which could not
fairly be said to have misled any one. Notably in the Rice
case,¹ brought by merchants to recover damages under the
Sherman Act, and the case of the Penn Refining Company,2
brought by shippers to recover damages sustained by the act
of the carrier in granting rebates in violation of section 2 of
the Commerce Act.
Had the construction been given to this remedial legisla-
tion, which the Supreme Court indicated should be given to
it, in the cases above referred to, a different result might
possibly have been reached in those cases, and also in the
Harp case, and the Oman case, where the shipper sought
to compel the carrier to carry, and afford him the same use
of tracks, cars, and terminal facilities which it was claimed
were employed by other shippers similarly situated.
3
4
1 Rice v. Standard Oil Co., 134 Fed. Rep. 464.
2 Western New York R. R. Co. v. Penn. Refining Co., 137 Fed. Rep. 343.
3 Harp v. Choctaw R. R. Co., 125 Fed. Rep. 445.
4 Oman v. Bedford-Bowling Green Stone Co., 134 Fed. Rep. 64.
xxxiv
INTRODUCTION.
THE TOBACCO TRUST CASES.
Of equal importance is the decision of the Supreme Court
in the Tobacco Trust cases, and its bearing upon the efficiency
of anti-trust legislation cannot be overestimated. Credit for
the results achieved in this most important litigation is
especially due to Mr. HENRY W. TAFT, special counsel for
the government, whose ability and learning in the conduct of
the proceeding materially contributed toward securing a con-
struction as to the limitation and scope of the Fourth and
Fifth Amendments to the Constitution, involving questions
decided by the Supreme Court for the first time in its
history.
1
"The decisions in the Hale and McAllister cases," says
Mr. TAFT, "have placed in the hands of the government a
potent weapon to compel obedience to the law. How it shall
be used will largely depend upon the attitude of the trusts
themselves. A just and wise enforcement of the commerce
laws did not require an immediate resort to criminal reme-
dies; and circumstances may still exist where the policy of
the law may be effectively carried out by means of in-
junctive relief. The commerce laws deal with a regulation
of interstate trade entirely new a generation ago. Business
dealings which had before been regarded as justifiable, both
in morals and law, became in a day mala prohibita. Multi-
tudes of transactions which had not been, in their general
effect, injurious to trade, were declared to be illegal, not
because they were intrinsically immoral or even, under ordi-
nary conditions, in violation of wise economic principles, but
because they enabled powerful corporations, by an aggrega-
tion of an immense amount of capital, to oppress and ulti-
mately to exterminate the less powerful. It was a serious
matter to prohibit by law methods of business which had
prevailed for many years; and the immediate and drastic
enforcement of such a law, a reasonable public opinion would
neither have demanded nor tolerated. It has taken years to
establish the principles upon which it must be determined
what constitutes a combination in restraint of interstate
1 Article in Columbia Law Review, June, 1906.
TOBACCO TRUST CASES.
XXXV
trade which is prohibited by the commerce acts. But they
are now so far settled that little excuse will hereafter be
afforded to a person or corporation for pleading ignorance of
them; and there can be no complaint of hardship if, for
violations of the law in clear cases, criminal penalties should
be vigorously imposed."
The Supreme Court, in the cases referred to, disposed of
the notion that a corporation could enter into conspiracies in
restraint of trade and commerce, in violation of the express
provisions of an act of Congress, and then escape the penalty
for its acts by refusing, when subpoenaed, to give any evi-
dence upon which a conviction could be based. In other
words, it was claimed that the Fifth Amendment threw about
the criminal conduct of corporations an almost impenetrable
veil, for if the agents and servants of the corporation could
refuse, under subpoena, to answer questions before the grand
jury, both they and the corporation would escape punish-
ment, and the law secking to punish them would become a
dead letter. Furthermore, evidence of criminal conspiracy
is sometimes clearly revealed in the books of the corporation;
and in order to withhold the evidence they contained, the
tobacco corporations invoked the aid of the Fourth Amend-
ment, which forbids unreasonable searches and seizures. Had
this contention prevailed, corporations engaged in criminal
conspiracies in violation of the Commerce Act or the Sher-
man Act, or any other law which Congress might pass,
would, probably, be able to nullify them. No indictment,
as a rule, could be found for the crimes which Congress
sought to punish, and no convictions could be had even if
indictments were found.
In addition to these important principles the court also
decided that a grand jury had power, without making a
specific charge against any particular person, to conduct an
inquisitorial proceeding, examining witnesses, and demand-
ing the production of documentary evidence, with a view to
determine whether there has been a violation of law, and, if
so, who committed it. The power of the grand jury upon
such an investigation is, of course, greatly aided by the
xxxvi
INTRODUCTION.
immunity provisions contained in the statutes, which, while
they render immune the officer or employees of a corporation,
do not permit such officer or employee to assert the privilege
against incrimination in behalf of the corporation or of any
fellow officer or employee.
The decision in the Tobacco Trust cases has overthrown
the contention of the corporations, that no law can reach
them because their conduct is rendered immune by the Fourth
and Fifth Amendments. The Supreme Court has said that
the Fifth Amendment does not extend to a corporation
at all, and that, while the unreasonable search and seizure
prohibited in the Fourth Amendment applies to search and
seizure without warrant of law and in the absence of a sub-
pœna or other lawful mandate, a Federal
Federal court has
power, in any proceeding authorized by law to issue its sub-
pœna or appropriate writ, commanding a corporation or an
individual or an officer or agent of the corporation, to appear
before a grand jury or before a petit jury and produce its
books for inspection, and that books produced in obedience
to such legal mandate are not unlawfully seized or searched
within the meaning of the Fourth Amendment.
The result is that the Sherman Act and the Commerce
Act are enforceable. Counsel will be compelled to resort to
some new device to defeat them. They cannot be evaded
by invoking, as a refuge the Fourth and Fifth Amendments
to the Constitution.
EMPLOYER'S LIABILITY BIll.
The first session of the Fifty-ninth Congress has made
longer strides in the field of economic legislation than that
of any Congress in history. The Interstate Commerce Act
and the Sherman Act were aimed at monopolies and trusts,
having for their object the establishment through diverse
forms of discrimination, of exclusive commercialism, and
exclusive commercialism may be said to be economic anarchy.
The Commerce Act affected carriers in their relations toward
shippers and consumers, and also in their relations toward
the communities, cities, and towns, through which the public
EMPLOYERS' LIABILITY BILL.
xxxvii
highways, operated by them under public franchises, ex-
tended. Remedies were required for other evils existing
in connection with interstate commerce. Congress has un-
dertaken, in a measure, to supply such remedies by appro-
priate legislation.
To afford relief to the employees of carriers engaged in
interstate commerce, it has enacted the Employers' Liability
Bill, authorizing an employee to recover damages for in-
juries he may have sustained, even though such injuries
may have been occasioned by the negligence of a fellow
servant or co-employee. The bill goes further and gives
to the legal representatives of a deceased employee, in the
service of a common carrier, a cause of action against the
employer, for damages for injuries resulting in the death
of the employee.
It
The employment of one engaged by a common carrier,
to transport persons and property at the highest rate of
speed, which the genius of man has made possible, is one of
peculiar peril. More than a million of men are so em-
ployed. The dangers attending their employment will be
understood when attention is called to the fact that in the
year 1904, 10,046 of these employees were killed and
84,155 were maimed or injured on the public highways of
the nation. Of the number of passengers carried in 1904,
441 were killed and 9,111 were injured. These quasi-pub-
lic servants have complained justly, that the law furnished no
adequate relief when they sought to recover damages.
is true the State courts were open, and the Federal courts
also, when plaintiff and defendant were residents of different
States. But established rules of evidence in some jurisdic-
tions rendered a recovery in many cases doubtful, and in
others impossible. At common law, a servant could not hold
the master liable for the negligence of a fellow servant.
This rule, while it has been abrogated in many States, still
prevails in others. The law governing contributory negli-
gence also is not uniform. In the Federal courts the ques-
tion of contributory negligence is usually a question of fact
for the jury; but in many States slight evidence of plaintiff's
contributory negligence will constitute a bar to his recovery.
xxxviii
INTRODUCTION.
The Employers' Liability Bill, approved June 11, 1906,
establishes a uniform rule. Under it the negligence of a
fellow servant will not bar his action, and in every case the
question of contributory negligence, where plaintiff's negli-
gence was slight, becomes a question of fact for the jury,
who may consider the comparative degree of plaintiff's
negligence, and diminish the amount of damages "in pro-
portion to the amount of negligence attributable to such
employee."
Statutes making the carrier liable to an employee for the
negligence of a fellow servant, have been adopted in many
States. Those in Kansas, Iowa, and Indiana, have been
sustained by the Supreme Court of the United States.*
Their validity was put upon the ground of the extreme
hazard attending the employment of operating a railway.
"The business of other corporations," said Mr. Justice
FIELD, in the Mackey case, "is not subject to similar dangers
to their employees, and no objection, therefore, can be made
to the legislation on the ground of its making an unjust
discrimination. It meets a particular necessity, and all
railroad corporations are, without distinction, made subject
to the same liabilities." As to creating a new liability
against the employer, where no personal wrong is chargeable
to the corporation, or its directors, Mr. Justice FIELD ob-
served: "The same hardship and injustice, if there be any,
exist when the company, without any wrong or negligence on
its part, is charged for injuries to passengers. Whatever
care and precaution may be taken in conducting its business
or in selecting its servants, if injury happen to the passen-
gers from the negligence or incompetency of the servants,
responsibility, therefore, at once attaches to it. The utmost
care on its part will not relieve it from liability, if the
passenger injured be himself free from contributory negli-
gence." The court held that the State legislature had power
to extend like liability where an employee was injured
through the negligence of a fellow servant.
* Tullis v. Lake Erie & Western Railroad, 175 U. S. 348; Missouri
Pacific Railway v. Mackey. 127 U. S. 205: Minneapolis & St. Louis Rail-
way v. Pontius, 157 U. S. 209.
LEGISLATION AS TO FOOD PRODUCTS.
xxxix
use.
PURE FOOD LEGISLATION.
Legislation has been enacted also to provide remedies for
other commercial evils, bordering very closely on the exercise
of the police power, which remains in the States, and
has never been delegated to the Federal government. The
cupidity of great industrial corporations has increased with
their unparalleled growth and prosperity. Not millions,
but hundreds of millions have been invested in combinations
which control the food supply of the country, and which fur-
nish also the beverages, liquors, and medicines in common
Congress, by the enactment of the Pure Food Bill
and the Meat Inspection Bill, has said in effect to these
public purveyors, the food, which you supply through agen-
cies of interstate commerce, must be pure and wholesome,
and every article of commerce intended for consumption,
whether for meat or drink, must be what it purports to be,
to entitle it to be carried from one State to another. To
that extent Congress, by enacting this legislation, has sought
to regulate such commerce, to protect the community from
the greed which has prompted unscrupulous methods in the
preparation and sale of the necessaries of life. The statute
requires these products to be labeled and branded, and for-
bids their interstate transportation unless so labeled. The
label must designate the contents and nature of the article
labeled, and the use of a false label is made a crime.
Laws respecting food products have heretofore been en-
acted by Congress, namely, taxing and regulating the prepa-
ration and sale of oleomargarine (Act of August 2, 1886);
of filled cheese (Act of June 6, 1896), and mixed flour (Act
of October 1, 1890). But the Pure Food Bill and the Meat
Inspection Bill is the first general legislation seeking to regu-
late the preparation and sale of food products, beverages,
and medicines.
HALL-MARK OR JEWELERS' LIABILITY BILL.
Congress has legislated also with regard to the manu-
facture and sale of merchandise prepared from gold and
silver, and has enacted what is known as the Hall-mark
xl
INTRODUCTION.
or Jewelers' Liability Bill. The hall-mark affixed by the
goldsmith and silver smith, and the worker in the precious
metals, must designate the true weight and fineness of the
metal, and the use of a spurious hall-mark is made a crim-
inal offense.
•
Hall-marks were devised during the Middle Ages to keep
the standard of articles made from the precious metals to
the required purity. They have been in use in England for
more than six hundred years. The first law making their
use compulsory was in the reign of Edward I, in the year
1300 (29 Edw. I, Stat. 3, Ch. 30). Under this statute the
stamp was designated as the King's mark, represented by a
leopard's head or a lion's head, crowned. In 1363 a law
was passed (37 Edw. III, Ch. 7) allowing the manufacturer
to add his own mark to that of the king, it being known as
the maker's mark. A devise was also adopted in 1438
known as the assayer's mark, indicated by a year letter,
consisting of an alphabet, one letter being used for each year,
counting from the day of the annual election of the Gold-
smith's Company. After the entire alphabet was exhausted,
different shaped letters were used to continue and preserve
the chronology. A spoon with the three marks complete, indi-
cating the year mark for 1445, may be seen in the South
Kensington Museum. The spoon was given by Henry VI to
Sir Ralph Pudsey.
Congress has now made the use of the hall-mark compul-
sory, by forbidding the importation, exportation, or carriage
in interstate commerce of falsely or spuriously stamped arti-
cles of merchandise made of gold or silver, or their alloys.
In this supplement, in addition to the text of the various
statutes, will be found also full notes of all decisions reported
since the publication of "Snyder's Interstate Commerce Act
and Federal Anti-Trust Laws," in July, 1904.
WILLIAM L. SNYDER.
TEMPLE COURT, 5 Beekman street,
NEW YORK, August, 1906.
SUPPLEMENT
ΤΟ
SNYDER'S INTERSTATE COMMERCE ACT AND
FEDERAL ANTI-TRUST LAWS.
CHAPTER ONE.
Text of the Interstate Commerce Act, as Amended
June 29, 1906. In Effect August 28, 1906.
An Act to amend an Act entitled "An Act to regulate commerce," ap-
proved February fourth, eighteen hundred and eighty-seven, and
all Acts amendatory thereof, and to enlarge the powers of the
Interstate Commerce Commission.
Be it enacted by the Senate and House of Representatives
of the United States of America in Congress assembled, That
section one of an Act entitled "An Act to regulate commerce,"
approved February fourth, eighteen hundred and eighty-seven,
be amended so as to read as follows:
Sec. 1. Commerce Act Interstate Commerce Defined.*
-That the provisions of this Act shall apply to any corpora-
tion or any person or persons engaged in the transportation
of oil or other commodity, except water and except natural
or artificial gas, by means of pipe lines, or partly by pipe
*The side headings in bold face type are inserted for convenience, and
form no part of the text of the Act.
For easy reference the amended sections and new sections of the
Commerce Act and Elkins Act are printed with leads between the
lines, the unamended sections are printed solid, without leads, changes
introduced by amendment are indicated, where practical, by italic, or a
reference at end of paragraph if it consists of entirely new matter.
2
COMMERCE ACT SEC. 1.
lines and partly by railroad, or partly by pipe lines and partly
by water, who shall be considered and held to be common
carriers within the meaning and purpose of this Act, and to
any common carrier or carriers engaged in the transportation
of passengers or property wholly by railroad (or partly by
railroad and partly by water when both are used under a com-
mon control, management, or arrangement for a continuous
carriage or shipment), from one State or Territory of the
United States, or the District of Columbia, to any other State
or Territory of the United States, or the District of Columbia,
or from one place in a Territory to another place in the same
Territory, or from any place in the United States to an ad-
jacent foreign country, or from any place in the United States
through a foreign country to any other place in the United
States, and also to the transportation in like manner of prop-
erty shipped from any place in the United States to a foreign
country and carried from such place to a port of transship-
ment, or shipped from a foreign country to any place in the
Unted States and carried to such place from a port of entry
either in the United States or an adjacent foreign country:
Provided, however, That the provisions of this Act shall not
apply to the transportation of passengers or property, or to the
receiving, delivering, storage, or handling of property wholly
within one State and not shipped to or from a foreign country
from or to any State or Territory as aforesaid.
com-
Sec. 1. Commerce Act continued Definitions Com-
mon Carrier - Railroad Transportation. The term "
mon carrier" as used in this Act shall include express
companies and sleeping car companies. The term "railroad,"
as used in this Act, shall include all bridges and ferries used
or operated in connection with any railroad, and also all the
road in use by any corporation operating a railroad, whether
owned or operated under a contract, agreement, or lease, and
shall also include all switches, spurs, tracks, and terminal facili-
ties of every kind used or necessary in the transportation of
the persons or property designated herein, and also all freight
CHARGES MUST BE REASONABLE
FREE TRANSPORTATION.
depots, yards, and grounds used or necessary in the transporta-
tion or delivery of any of said property; and the term "trans-
portation" shall include cars and other vehicles and all instru-
mentalities and facilities of shipment or carriage, irrespective
of ownership or of any contract, express or implied, for the
use thereof and all services in connection with the receipt,
delivery, elevation, and transfer in transit, ventilation, refriger-
ation or icing, storage, and handling of property transported;
and it shall be the duty of every carrier subject to the pro-
visions of this Act to provide and furnish such transportation
upon reasonable request therefor, and to establish through
routes and just and reasonable rates applicable thereto.
Sec. 1. Commerce Act Continued Charges must be
Reasonable.-All charges made for any service rendered or
to be rendered in the transportation of passengers or property
as aforesaid, or in connection therewith,[1] shall be just and
reasonable; and every unjust and unreasonable charge for
such service or any part thereof is prohibited and declared to
be unlawful.
Sec. 1. Commerce Act Continued Free Transporta-
tion, when Prohibited.*-No common carrier subject to the
provisions of this Act, shall, after January first, nineteen hun-
dred and seven, directly or indirectly, issue or give any inter-
state free ticket, free pass, or free transportation for passen-
gers, except to its employees and their families, its officers,
agents, surgeons, physicians, and attorneys at law; to minis-
ters of religion, traveling secretaries of railroad Young Men's
Christian Associations, inmates of hospitals and charitable and
eleemosynary institutions, and persons exclusively engaged in
[1] Words "for the receiving, delivery, storage, or hauling such prop-
erty" omitted.
*These provisions with regard to free passes and free transportation,
introduced by the Act of June 29, 1906, are practically a re-enactment
of Sec. 22 of the Commerce Act, and wherever they conflict with the
provisions of Sec. 22 the provisions of the latter section are repealed.
See Sec. 22, post, page 35.
4
COMMERCE ACT - SEC. 1.
charitable and eleemosynary work; to indigent, destitute and
homeless persons, and to such persons when transported by
charitable societies or hospitals, and the necessary agents em-
ployed in such transportation; to inmates of the National
Homes or State Homes for Disabled Volunteer Soldiers, and
of Soldiers' and Sailors' Homes, including those about to
enter and those returning home after discharge and boards
of managers of such Homes; to necessary care takers of live
stock, poultry, and fruit; to employees on sleeping cars,
express cars, and to linemen of telegraph and telephone com-
panies; to Railway Mail Service employees, post-office inspec-
tors, customs inspectors and immigration inspectors; to news-
boys on trains, baggage agents, witnesses attending any legal
investigation in which the common carrier is interested, per-
sons injured in wrecks and physicians and nurses attending
such persons: Provided, That this provision shall not be con-
strued to prohibit the interchange of passes for the officers,
agents, and employees of common carriers, and their families;
nor to prohibit any common carrier from carrying passengers
free with the object of providing relief in cases of general
epidemic, pestilence, or other calamitous visitation. Any com-
mon carrier violating this provision shall be deemed guilty of
a misdemeanor and for each offense, on conviction, shall pay
to the United States a penalty of not less than one hundred
dollars nor more than two thousand dollars, and any person,
other than the persons excepted in this provision, who uses
any such interstate free ticket, free pass, or free transporta-
tion, shall be subject to a like penalty. Jurisdiction of offenses
under this provision shall be the same as that provided for
offenses in an Act entitled "An Act to further regulate com-
merce with foreign nations and among the States," approved
February nineteenth, nineteen hundred and three, and any
amendment thereof. (New Provision added by Act of June
29, 1906.)
Sec. 1. Commerce Act Continued
in Commodities Transported. From
Carriers not to deal
and after May first,
SWITCHES AND TERMINAL FACILITIES.
5
nineteen hundred and eight, it shall be unlawful for any rail-
road company to transport from any State, Territory, or the
District of Columbia, to any other State, Territory, or the
District of Columbia, or to any foreign country, any article or
commodity, other than timber and the manufactured products
thereof, manufactured, mined, or produced by it, or under its
authority, or which it may own in whole, or in part, or in
which it may have any interest direct or indirect except such
articles or commodities as may be necessary and intended for
its use in the conduct of its business as a common carrier.
(New Provision added by Act of June 29, 1906.)
Sec. 1. Commerce Act Continued Switches and Ter-
minal Facilities.-Any common carrier subject to the provi-
sions of this Act, upon application of any lateral, branch line
of railroad, or of any shipper tendering interstate traffic for
transportation, shall construct, maintain, and operate upon
reasonable terms a switch connection with any such lateral,
branch line of railroad, or private side track which may be
constructed to connect with its railroad, where such connec-
tion is reasonably practicable and can be put in with safety
and will furnish sufficient business to justify the construction
and maintenance of the same; and shall furnish cars for the
movement of such traffic to the best of its ability without
discrimination in favor of or against any such shipper. If
any common carrier shall fail to install and operate any such
switch or connection as aforesaid, on application there for in
writing by any shipper, such shipper may make complaint to
the Commission, as provided in section thirteen of this Act,
and the Commission shall hear and investigate the same and
shall determine as to the safety and practicability thereof and
justification and reasonable compensation therefor and the
Commission may make an order, as provided in section fifteen
of this Act, directing the common carrier to comply with the
provisions of this section in accordance with such order, and
such order shall be enforced as hereinafter provided for the
6
SECS. 2, 3, 4.
COMMERCE ACT
enforcement of all other orders by the Commission, other than
orders for the payment of money. (New Provision added by
Act of June 29, 1906.)
Unjust
Sec. 2. Commerce Act Rebates Prohibited
Discrimination Defined. That if any common carrier sub-
ject to the provisions of this act shall, directly or indirectly,
by any special rate, rebate, drawback, or other device, charge,
demand, collect, or receive from any person or persons a
greater or less compensation for any service rendered, or to
be rendered, in the transportation of passengers or property,
subject to the provisions of this act, than it charges, demands,
collects, or receives from any other person or persons for
doing for him or them a like and contemporaneous service in
the transportation of a like kind of traffic under substantially
similar circumstances and conditions, such common carrier
shall be deemed guilty of unjust discrimination, which is
hereby prohibited and declared to be unlawful.
Sec. 3. Commerce Act Preferences and Advantages.-
That it shall be unlawful for any common carrier subject to
the provisions of this act to make or give any undue or un-
reasonable preference or advantage to any particular person,
company, firm, corporation or locality, or any particular
description of traffic, in any respect whatsoever, or to subject
any particular person, company, firm, corporation, or locality,
or any particular description of traffic, to any undue or un-
reasonable prejudice or disadvantage in any respect whatso-
ever.
Sec. 3. Commerce Act Continued - Duty of Connecting
Lines.- Every common carrier subject to the provisions
of this act shall, according to their respective powers, afford
all reasonable, proper, and equal facilities for the interchange
of traffic between their respective lines, and for the receiving,
forwarding, and delivering of passengers and property to and
from their several lines and those connecting therewith, and
shall not discriminate in their rates and charges between such
connecting lines; but this shall not be construed as requiring
any such common carrier to give the use of its tracks or ter-
minal facilities to another carrier engaged in like business.
Sec. 4. Commerce Act Long and Short Haul Regula-
tions Power of Commission. That it shall be unlawful.
for any common carrier subject to the provisions of this act
to charge or receive any greater compensation in the aggre-
POOLING - PUBLICATION OF SCHEDULES.
7
gate for the transportation of passengers or of like kind of
property, under substantially similar circumstances and con-
ditions, for a shorter than for a longer distance over the same
line, in the same directon, the shorter being included within
the longer distance; but this shall not be construed as author-
izing any common carrier within the terms of this act to
charge and receive as great compensation for a shorter as for
a longer distance: Provided, however, That upon application
to the Commission appointed under the provisions of this act,
such common carrier may, in special cases, after investigation
by the Commisson, be authorized to charge less for longer
than for shorter distances for the transportation of passengers
or property; and the Commission may from time to time pre-
scribe the extent to which such designated common carrier
may be relieved from the operation of this section of this act.
Sec. 5. Commerce Act Pools and Combinations Pro-
hibited. That it shall be unlawful for any common carrier
subject to the provisions of this act to enter into any contract,
agreement, or combination with any other common carrier or
carriers for the pooling of freights of different and com-
peting railroads, or to divide between them the aggregate or
net proceeds of the earnings of such railroads, or any portion
thereof; and in any case of an agreement for the pooling of
freights as aforesaid, each day of its continuance shall be
deemed a separate offense.
q
Sec. 6. Commerce Act Schedule of Rates to be Pub-
lished.* That every common carrier subject to the provi-
sions of this Act shall file with the Commission created by this
Act and print and keep open to public inspection schedules
showing all the rates, fares, and charges for transportation
between different points on its own route and between points
on its own route and points on the route of any other carrier
by railroad, by pipe linc, or by water when a through route
and joint rate has been established. If no joint rate over the
through route has been established, the several carriers in such
through route shall file, print and keep open to public inspec-
tion as aforesaid, the separately established rates, fares and
charges applied to the through transportation. The schedules
printed as aforesaid by any such common carrier shall plainly
state the places [1] between which property and passengers will
*Section 6 has been entirely re-arranged by the Act approved June
29, 1906.
[1] Words upon its railroad" omitted.
Co
COMMERCE ACT SEC. 6.
be carried, and shall contain the classification of freight in
force, and shall also state separately all terminal charges,
storage charges, icing charges, and all other charges which the
Commission may require, all privileges or facilities granted or
allowed and any rules or regulations which in any wise change,
affect, or determine any part or the aggregate of such afore-
said rates, fares, and charges, or the value of the service ren-
dered to the passenger, shipper, or consignee. Such schedules
shall be plainly printed in large type, and copies for the use
of the public shall be kept posted in two public and conspicu-
ous places in every depot, station, or office of such carrier
where passengers or freight, respectively, are received for
transportation, in such form that they shall be accessible to
the public and can be conveniently inspected. The provisions
of this section shall apply to all traffic, transportation, and
facilities defined in this Act.
Sec. 6. Commerce Act Continued - Rates Through For-
eign Country.- Any common carrier subject to the provisions
of this Act receiving freight in the United States to be carried
through a foreign country to any place in the United States
shall also in like manner print and keep open to public inspec-
tion, at every depot or office where such freight is received
for shipment, schedules showing the through rates established
and charged by such common carrier to all points in the United
States beyond the foreign country to which it accepts freight
for shipment; and any freight shipped from the United States
through a foreign country into the United States the through
rate on which shall not have been made public, as required
by this Act, shall, before it is admitted into the United States
from said foreign country, be subject to customs duties as if
said freight were of foreign production.
Change of Rates
Sec. 6. Commerce Act Continued
must be on Notice.-No change shall be made in the rates,
fares, and charges or joint rates, fares, and charges which have
JOINT-TARIFF RATES.
9
been filed and published by any common carrier in compliance
with the requirements of this section, except after thirty days'
notice to the Commission and to the public published as afore-
said, which shall plainly state the changes proposed to be made
in the schedule then in force and the time when the changed*
rates, fares, or charges will go into effect; and the proposed
changes shall be shown by printing new schedules, or shall
be plainly indicated upon the schedules in force at the time and
kept open to public inspection: Provided, That the Commission
may, in its discretion and for good cause shown, allow changes
upon less than the notice herein specified, or modify the re-
quirements of this section in respect to publishing, posting, and
filing of tariffs, either in particular instances or by a general
order applicable to special or peculiar circumstances or
conditions.
Provision as to Joint
Sec. 6. Commerce Act Continued
Tariff Rates.- The names of the several carriers which are
parties to any joint tariff shall be specified therein, and each
of the parties thereto, other than the one filing the same, shall
file with the Commission such evidence of concurrence therein
or acceptance thereof as may be required or approved by the
Commission, and where such evidence of concurrence or ac-
ceptance is filed it shall not be necessary for the carriers filing
the same to also file copies of the tariffs in which they are
named as parties.
Every common carrier subject to this Act shall also file with
said Commission copies of all contracts, agreements, or
arrangements with other common carriers in relation to any
traffic affected by the provisions of this Act to which it may
be a party.
The Commission may determine and prescribe the form in
which the schedules required by this section to be kept open
to public inspection shall be prepared and arranged and may
change the form from time to time as shall be found expedient.
*Word changed" substituted for word "increased."
10 COMMERCE ACT · SEC. 6 — ELKINS ACT
SEC. 1.
Sec. 6. Commerce Act Continued Publication Condi-
tion Precedent Preference Time of War. No carrier,
unless otherwise provided by this Act, shall engage
or participate in the transportation of passengers or property,
as defined in this Act, unless the rates, fares, and charges upon
which the same are transported by said carrier have been filed
and published in accordance with the provisions of this Act;
nor shall any carrier charge or demand or collect or receive
a greater or less or different compensation for such transporta-
tion of passengers or property, or for any service in connec-
tion therewith, between the points named in such tariffs than
the rates, fares, and charges which are specfied in the tariff.
filed and in effect at the time; nor shall any carrier refund or
remit in any manner or by any device any portion of the rates,
fares, and charges so specified, nor extend to any shipper or
person any privileges or facilities in the transportation of pas-
sengers or property, except such as are specified in such tariffs:
Provided, That wherever the word "carrier" occurs in this
Act it shall be held to mean common carrier.”
That in time of war or threatened war preference and
precedence shall, upon the demand of the President of the
United States, be given, over all other traffic, to the transporta-
tion of troops and material of war, and carriers shall adopt
every means within their control to facilitate and expedite the
military traffic.
(C
That section one of the Act entitled An Act to further
regulate commerce with foreign nations and among the States,
approved February nineteenth, 1903, be amended, so as to read
as follows:
Sec. 1. Elkins Act
ceivers, Trustees, etc.
Liability for Acts of Agents Re-
Imprisonment.- That anything
done or omitted to be done by a corporation common carrier,
subject to the Act to regulate commerce and the Acts amend-
tory thereof, which, if done or omitted to be done by any
director or officer thereof, or any receiver, trustee, lessee,
agent, or person acting for or employed by such corporation,
•
PENALTIES · IMPRISONMENT.
11
would constitute a msdemeanor under said Acts or under this
Act, shall also be held to be a misdemeanor committed by such
corporation, and upon conviction thereof it shall be subject
to like penalties as are prescribed in said Act or by this Act
with reference to such persons, except as such penalties are
herein changed. The willful failure upon the part of any
carrier subject to said Acts to file and publish the tariffs or
rates and charges as required by said Acts, or strictly to ob-
serve such tariffs until changed according to law, shall be a
misdemeanor, and upon conviction thereof the corporation
offending shall be subject to a fine of not less than one thousand
dollars nor more than twenty thousand dollars for each
offense; and it shall be unlawful for any person, persons, or
corporation to offer, grant, or give, or to solicit, accept, or
receive any rebate, concession, or discrimination in respect to
the transportation of any property in interstate or foreign com-
merce by any common carrier subject to said Act to regulate
commerce and the Acts amendatory thereof whereby any such
property shall by any device whatever be transported at a less
rate than that named in the tariffs published and filed by such
carrier, as is required by said Act to regulate commerce and
the Acts amendatory thereof, or whereby any other advantage
is given or discrimination is practiced. Every person or cor-
poration, whether carrier or shipper, who shall, knowingly,
offer, grant, or give, or solicit, accept, or receive any such
rebates, concession, or discrimination shall be deemed guilty of
a misdemeanor, and on conviction thereof shall be punished
by a fine of not less than one thousand dollars nor more than
twenty thousand dollars: Provided, That any person, or any
officer or director of any corporation subject to the provisions
of this Act, or the Act to regulate commerce and the Acts
amendatory thereof, or any receiver, trustee, lessee, agent, or
person acting for or employed by any such corporation, who
shall be convicted as aforesaid, shall, in addition to the fine
herein provided for, be liable to imprisonment in the peniten-
tiary for a term of not exceeding two years, or both such fine
12
ELKINS ACT SEC. 1.
and imprisonment, in the discretion of the court. Every viola-
tion of this section shall be prosecuted in any court of the
United States having jurisdiction of crimes within the district
in which such violation was committed, or through which the
transportation may have been conducted; and whenever the
offense is begun in one jurisdiction and completed in another
it may be dealt with, inquired of, tried, determined, and pun-
ished in either jurisdiction in the same manner as if the offense
had been actually and wholly committed therein.
In construing and enforcing the provisions of this section,
the act, omission, or failure of any officer, agent, or other per-
son acting for or employed by any common carrier, or shipper,
acting within the scope of his employment, shall in every case
be also deemed to be the act, omission, or failure of such car-
rier or shipper as well as that of the person. Whenever any
carrier files with the Interstate Commerce Commission or pub-
lishes a particular rate under the provisions of the Act to regu-
late commerce or Acts amendatory thereof, or participates in
any rates so filed or published, that rate as against such carrier,
its officers or agents, in any prosecution begun under this Act
shall be conclusively deemed to be the legal rate, and any
departure from such rate, or any offer to depart therefrom,
shall be deemed to be an offense under this section of this Act.
Rebates
Forfeiture of
Any person,
Sec. 1. Elkins Act Continued
three times Amount, as Additional Penalty.
corporation, or company who shall deliver property for inter-
state transportation to any common carrier, subject to the pro-
visions of this Act, or for whom as consignor or consignee, any
such carrier shall transport property from one State, Territory,
or the District of Columbia to any other State, Territory, or
the District of Columbia, or foreign country, who shall
knowingly by employee, agent, officer, or otherwise, directly
or indirectly, by or through any means or device whatsoever,
receive or accept from such common carrier any sum of money
or any other valuable consideration as a rebate or offset against
the regular charges for transportation of such property, as
CONTINUOUS CARRIAGE.
13
fixed by the schedules of rates provided for in this Act, shall
in addition to any penalty provided by this Act forfeit to the
United States a sum of money three times the amount of
money so received or accepted and three times the value of
any other consideration so received or accepted, to be ascer-
tained by the trial court; and the Attorney-General of the
United States is authorized and directed, whenever he has
reasonable grounds to believe that any such person, corpora-
tion, or company has knowingly received or accepted from any
such common carrier any sum of money or other valuable con-
sideration as a rebate or offset as aforesaid, to institute in any
court of the United States of competent jurisdiction, a civil.
action to collect the said sum or sums so forfeited as aforesaid;
and in the trial of said action all such rebates or other con-
siderations so received or accepted for a period of six years
prior to the commencement of the action, may be included
therein, and the amount recovered shall be three times the
total amount of money, or three times the total value of such
consideration, so received or accepted, or both, as the case may
be.* (New provision added by Act of June 29, 1906.)
Sec. 7. Commerce Act Continuous Carriage from Point
of Shipment to Point of Destination.— That it shall be un-
lawful for any common carrier subject to the provisions of
this act to enter into any combination, contract, or agreement,
expressed or implied, to prevent, by change of time schedule,
carriage in different cars, or by other means or devices, the
carriage of freights from being continuous from the place of
shipment to the place of destination; and no break of bulk,
stoppage, or interruption made by such common carrier shall
prevent the carriage of freights from being and being treated
as one continuous carriage from the place of shipment to the.
place of destination, unless such break, stoppage, or interrup-
tion was made in good faith for some necessary purpose, and
without any intent to avoid or unnecessarily interrupt such
continuous carriage or to evade any of the provisions of this
act.
*For the remaining sections of the Elkins Act (Sections 2, 3, 4 and
5), see Snyder's Interstate Commerce Act, pages 135-138.
Hor M
14
SECS. 8, 9, 10.
COMMERCE ACT
Sec. 8. Commerce Act - Liability of Carrier in Dam-
ages. That in case any common carrier subject to the pro-
visions of this act shall do, cause to be done, or permit to be
done any act, matter, or thing in this act prohibited or declared
to be unlawful, or shall omit to do any act, matter, or thing
in this act required to be done, such common carrier shall be
liable to the person or persons injured thereby for the full
amount of damages sustained in consequence of any such viola-
tion of the provisions of this act, together with a reasonable
counsel or attorney's fee, to be fixed by the court in every case
of recovery, which attorney's fee shall be taxed and collected
as part of the costs in the case.
Sec. 9. Commerce Act Remedy of Shipper in Alterna-
tive by Complaint to Commission or Suit in Federal Court.
-That any person or persons claiming to be damaged by any
common carrier subject to the provisions of this act may either
make complaint to the Commission as hereinafter provided for,
or may bring suit in his or their own behalf for the recovery
of the damages for which such common carrier may be liable
under the provisions of this act, in any district or circuit court
of the United States of competent jurisdiction; but such per-
son or persons shall not have the right to pursue both of said
remedies, and must in each case elect which one of the two
methods of procedure herein provided for he or they will
adopt. In any such action brought for the recovery of dam-
ages the court before which the same shall be pending may
compel any director, officer, receiver, trustee, or agent of the
corporation or company defendant in such suit to attend, ap-
pear, and testify in such case, and may compel the production
of the books and papers of such corporation or company party
to any such suit; the claim that any such testimony or evidence
may tend to criminate the person giving such evidence shall
not excuse such witness from testifying, but such evidence or
testimony shall not be used against such person on the trial
of any criminal proceeding.
Sec. 10. Commerce Act - Criminal Liability of Carrier.-
That any common carrier subject to the provisions of this act,
or, whenever such common carrier is a corporation, any direc-
tor or officer thereof, or any receiver, trustee, lessee, agent, or
person, acting for or employed by such corporation, who, alone
or with any other corporation, company, person, or party, shall
willfully do or cause to be done, or shall willingly suffer or
permit to be done, any act, matter, or thing in this act pro-
hibited or declared to be unlawful, or who shall aid or abet
CRIMINAL LIABILITY.
15
therein, or shall willfully omit or fail to do any act, matter, or
thing in this act required to be done, or shall cause or willingly
suffer or permit any act, matter, or thing so directed or re-
quired by this act to be done not to be so done, or shall aid
or abet any such omission or failure, or shall be guilty of any
infraction of this act, or shall aid or abet therein, shall be
deemed guilty of a misdemeanor, and shall, upon conviction
thereof in any district court of the United States within the
jurisdiction of which such offense was committed, be subject
to a fine of not to exceed five thousand dollars for each
offense:* [Provided, That if the offense for which any person
shall be convicted as aforesaid shall be an unlawful discrimina-
tion in rates, fares, or charges, for the transportation of pas-
sengers or property, such person shall, in addition to the fine
hereinbefore provided for, be liable to imprisonment in the
penitentiary for a term of not exceeding two years, or both
such fine and imprisonment, in the discretion of the court.]
Sec. 10. Commerce Act Continued — Criminal Liability
of Carrier for False Bills, Weights or Classification.- Any
common carrier subject to the provisions of this act, or, when-
ever such common carrier is a corporation, any officer or agent
thereof, or any person acting for or employed by such cor-
poration, who, by means of false billing, false classification,
false weighing, or false report of weight, or by any other
device or means, shall knowingly and wilfully assist, or shall
willingly suffer or permit, any person or persons to obtain
transportation for property at less than the regular rates then
established and in force on the line of transportation of such
common carrier, shall be deemed guilty of a misdemeanor, and
shall, upon conviction thereof in any court of the United States
of competent jurisdiction within the district in which such
offense was committed, be subject to a fine of not exceeding
five thousand dollars,† [or imprisonment in the penitentiary
for a term of not exceeding two years, or both, in the dis-
cretion of the court, for each offense.]
*The penalty of imprisonment which was abolished by Sec. 1 of the
Elkins Act, approved February 19, 1903, was restored by the amendment
of that section by the Act approved June 29, 1906. The imprisonment
penalty as restored seems to relate only to the crime of rebating. See
Elkins Act, Sec. 1, as amended under Sec. 6 of the Commerce Act,
ante, page 11. For original Elkins Act, Sec. 1, see Snyder Interstate
Commerce Act, page 134.
II.
The penalty of imprisonment was abolished by Sec. 1 of the Elkins
Act, approved February 19, 1903, which declared that no penalty shall
be imposed on the convicted party, other than the fine prescribed by
law, imprisonment wherever now prescribed as part of the penalty being
16
COMMERCE ACT SEC. 10.
Sec. 10. Commerce Act Continued Criminal Liability
of Shipper for False Bills, Weights or Classification.- Any
person and any officer or agent of any corporation or company
who shall deliver property for transportation to any common
carrier, subject to the provisions of this act, or for whom as
consignor or consignee any such carrier shall transport prop-
erty, who shall knowingly and wilfully, by false billing, false
classification, false weighing, false representation of the contents
of the package, or false report of weight, or by any other device
or means, whether with or without the consent or connivance
of the carrier, its agent or agents, obtain transportation for
such property at less than the regular rates then established
and in force on the line of transportation, shall be deemed
guilty of fraud, which is hereby declared to be a misdemeanor,
and shall, upon conviction thereof in any court of the United
States of competent jurisdiction within the district in which
such offense was committed, be subject for each offense to a
fine of not exceeding five thousand dollars* [or imprisonment
in the penitentiary for a term of not exceeding two years, or
both, in the discretion of the court].
Sec. 10. Commerce Act Continued Joint and Several
Criminal Liability of Shipper and Carrier. If any such
person, or any officer or agent of any such corporation or com-
pany, shall, by payment of money or other thing of value,
solicitation, or otherwise, induce any common carrier subject
to the provisions of this act, or any of its officers or agents, to
discriminate unjustly in his, its, or their favor as against any
hereby abolished." See Elkins Act, Snyder's Interstate Commerce Act,
page 134.
Section I of the Elkins Act was amended by the Act of June 29, 1906,
and the portion of the section abolishing imprisonment was omitted,
and a clause inserted therein making violations of the Elkins Act and
certain parts of the Commerce, punishable by imprisonment, or by
fine, or by both fine and imprisonment. The imprisonment penalty as
restored, however, seems to relate only to the crime of rebating. See
Elkins Act, Sec. 1, as amended under Sec. 6 of the Commerce Act,
ante, page II.
*The penalty of imprisonment was abolished by Sec. 1 of the Elkins
Act, approved February 19, 1903, which declares that no penalty shall
be imposed on the convicted party, other than the fine prescribed by
law, imprisonment wherever now prescribed as part of the penalty being
hereby abolished." See Elkins Act, Snyder's Interstate Commerce Act,
page 134.
Section 1 of the Elkins Act was amended June 29, 1906, and the
penalty of imprisonment was restored as therein provided, but seems to
relate only to the crime of rebating. See Elkins Act, Sec. 1, as
amended, ante, page II.
INTERSTATE COMMERCE COMMISSION CREATED.
17
other consignor or consignee in the transportation of property,
or shall aid or abet any common carrier in any such unjust dis-
crimination, such person, or such officer or agent of such cor-
poration or company, shall be deemed guilty of a misdemeanor,
and shall, upon conviction thereof in any court of the United
States of competent jurisdiction within the district in which
such offense was committed, be subject to a fine of not ex-
ceeding five thousand dollars,* [or imprisonment in the peni-
tentiary for a term of not exceeding two years, or both, in
the discretion of the court,] for each offense; and such person,
corporation, or company shall also, together with said common
carrier, be liable, jointly or severally, in an action on the case
to be brought by any consignor or consignee discriminated
against in any court of the United States of competent jurisdic-
tion for all damages caused by or resulting therefrom. (As
amended March 2, 1889.)
Sec. 11. Commerce Act Interstate Commerce Com-
mission Created-- That a Commission is hereby created
and established to be known as the Inter-State Commerce Com-
mission, which shall be composed of five Commissioners,† who
shall be appointed by the President, by and with the advice
and consent of the Senate. The Commissioners first appointed
under this act shall continue in office for the term of two, three,
four, five, and six years, respectively, from the first day of
January, anno Domini eighteen hundred and eighty-seven, the
term of each to be designated by the President; but their suc-
cessors shall be appointed for terms of six years, except that
any person chosen to fill a vacancy shall be appointed only
for the unexpired time of the Commissioner whom he shall
succeed. Any Commissioner may be removed by the President
for inefficiency, neglect of duty, or malfeasance in office. Not
more than three of the Commissioners shall be appointed from
the same political party. No person in the employ of or hold-
* The penalty of imprisonment was abolished by the Elkins Act, Sec. 1,
approved February 19, 1903, which declared that no penalty shall be
imposed on the convicted party, other than the fine prescribed by law,
imprisonment wherever now prescribed as part of the penalty being
hereby abolished." See Elkins Act, Snyder's Interstate Commerce Act,
page 134.
Section 1 of the Elkins Act was amended by the Act of June 29, 1906,
and the penalty of imprisonment was restored as therein provided, but
seems to relate only to the crime of rebating. See Elkins Act, Sec. I,
as amended, ante, page II.
Increased to seven Commissioners, and terms of office extended to
seven years, by Section 24 of the Act, being a new section added by Act
of June 29, 1906. See Section 24, infra, page 37.
18
SEC. 12.
COMMERCE ACT
ing any official relation to any common carrier subject to the
provisions of this act, or owning stock or bonds thereof, or
who is in any manner pecuniarily interested therein, shall enter
upon the duties of or hold such office. Said Commissioners
shall not engage in any other business, vocation, or employ-
ment. No vacancy in the Commission shall impair the right of
the remaining Commissioners to exercise all the powers of
the Commission.
Sec. 12. Commerce Act Commission may Prosecute
through United States District Attorney. That the Com-
mission hereby created shall have authority to inquire into the
management of the business of all common carriers subject to
the provisions of this act, shall keep itself informed as to the
manner and method in which the same is conducted, and shall
have the right to obtain from such common carriers full and
complete information necessary to enable the Commission to
perform the duties and carry out the objects for which it was
created; and the Commission is hereby authorized and required
to execute and enforce the provisions of this act; and, upon
the request of the Commission, it shall be the duty of any
district attorney of the United States to whom the Commission
may apply to institute in the proper court and to prosecute
under the direction of the Attorney-General of the United
States all necessary proceedings for the enforcement of the
provisions of this act and for the punishment of all violations
thereof, and the costs and expenses of such prosecution shall
be paid out of the appropriation for the expenses of the courts
of the United States; and for the purposes of this act the Com-
mission shall have power to require, by subpoena, the attend-
ance and testimony of witnesses and the production of all
books, papers, tariffs, contracts, agreements, and documents
relating to any matter under investigation.
At-
Sec. 12. Commerce Act Continued Witnesses
tendance Compulsory. Such attendance of witnesses, and
the production of such documentary evidence, may be required
from any place in the United States, at any designated place
of hearing. And in case of disobedience to a subpoena the
Commission, or any party to a proceeding before the Com-
mission, may invoke the aid of any court of the United States
in requiring the attendance and testimony of witnesses and
the production of books, papers, and documents under the pro-
visions of this section.
Sec. 12. Commerce Act Continued Penalty for Dis-
obedience of Witness. And any circuit courts of the
TESTIMONY.
DEPOSITIONS.
19
United States within the jurisdiction of which such inquiry is
carried on may, in case of contumacy or refusal to obey a
subpoena issued to any common carrier subject to the pro-
visions of this act, or other person, issue an order requiring
such common carrier or other person to appear before said
Commission (and produce books and papers if so ordered)
and give evidence touching the matter in question; and any
failure to obey such order of the court may be punished by
such court as a contempt thereof. The claim that any such
testimony or evidence may tend to criminate the person giving
such evidence shall not excuse such witness from testifying;
but such evidence or testimony shall not be used against such
person on the trial of any criminal proceeding.
Testimony Taken
Sec. 12. Commerce Act Continued
by Deposition--The testimony of any witness may be
taken, at the instance of a party, in any proceeding or investiga-
tion depending before the Commission, by deposition, at any
time after a cause or proceeding is at issue on petition and
answer. The Commission may also order testimony to be
taken by deposition in any proceeding or investigation pending
before it, at any stage of such proceeding or investigation.
Such depositions may be taken before any judge of any court
of the United States, or any commissioner of a circuit, or any
clerk of a district or circuit court, or any chancellor, justice,
or judge of a supreme or superior court, mayor or chief magis-
trate of a city, judge of a county court, or court of common
pleas of any of the United States, or any notary public, not
being of counsel or attorney to either of the parties, nor inter-
ested in the event of the proceeding or investigation. Reason-
able notice must first be given in writing by the party or his
attorney proposing to take such deposition to the opposite party
or his attorney of record, as either may be nearest, which notice
shall state the name of the witness and the time and place of
the taking of his deposition. Any person may be compelled
to appear and depose, and to produce documentary evidence,
in the same manner as witnesses may be compelled to appear
and testify and produce documentary evidence before the Com-
mission as hereinbefore provided.
Sec. 12. Commerce Act Continued Deposition, how
Taken.- Every person deposing as herein provided shall be
cautioned and sworn (or affirm, if he so request) to testify
the whole truth, and shall be carefully examined. His testi-
mony shall be reduced to writing by the magistrate taking the
deposition, or under his direction, and shall, after it has been
reduced to writing, be subscribed by the deponent.
20
COMMERCE ACT SECS. 12, 13, 14.
Sec. 12. Commerce Act Continued - Foreign Witnesses
Fees. If a witness whose testimony may be desired to
be taken by deposition be in a foreign country, the deposition
may be taken before an officer or person designated by the
Commission, or agreed upon by the parties by stipulation in
writing to be filed with the Commission. All depositions must
be promptly filed with the Commission.
Witnesses whose depositions are taken pursuant to this act,
and the magistrate or other officer taking the same, shall
severally be entitled to the same fees as are paid for like
services in the courts of the United States. (As amended
March 2, 1889, and February 10, 1891.)
Sec. 13. Commerce Act Complaint to Commission,
How Made Investigations, How Conducted. That any
person, firm, corporation, or association, or any mercantile,
agricultural, or manufacturing society, or any body politic or
municipal organization complaining of anything done or
omitted to be done by any common carrier subject to the pro-
visions of this act in contravention of the provisions thereof
may apply to said Commission by petition, which shall briefly
state the facts; whereupon a statement of the charges thus
made shall be forwarded by the Commission to such common
carrier, who shall be called upon to satisfy the complaint or to
answer the same in writing within a reasonable time, to be
specified by the Commission. If such common carrier, within
the time specified, shall make reparation for the injury alleged
to have been done, said carrier shall be relieved of liability to
the complainant only for the particular violation of law thus
complained of. If such carrier shall not satisfy the complaint
within the time specified, or there shall appear to be any reason-
able ground for investigating said complaint, it shall be the
duty of the Commission to investigate the matters complained
of in such manner and by such means as it shall deem proper.
Sec. 13. Commerce Act Continued — Complaints by State
Railroad Commissions.- Said Commission shall in like
manner investigate any complaint forwarded by the railroad
commissioner or railroad commission of any State or Territory,
at the request of such commissioner or commission, and may
institute any inquiry on its own motion in the same manner
and to the same effect as though complaint had been made.
No complaint shall at any time be dismissed because of the
absence of direct damage to the complainant.
Sec. 14. Commerce Act - Reports and Finding of Com-
mission shall be Evidence.- That whenever an investiga-
COMMISSION MAY FIX RATES.
21
tion shall be made by said Commission, it shall be its duty to
make a report in writing in respect thereto, which shall state
the conclusions of the Commission, together with its decision,
order, or requirement in the premises; and in case damages
are awarded such report shall include the findings of fact on
which the award is made.
All reports of investigations made by the Commission shall
be entered of record, and a copy thereof shall be furnished to
the party who may have complained, and to any common
carrier that may have been complained of.
The Commission may provide for the publication of its
reports and decisions in such form and manner as may be best
adapted for public information and use, and such authorized
publications shall be competent evidence of the reports and
decisions of the Commission therein contained in all courts of
the United States and of the several States without any further
proof or authentication thereof. The Commission may also
cause to be printed for early distribution its annual reports.
(First Paragraph rearranged by Act of June 29, 1906.)
Sec. 15. Commerce Act Commission May Fix Rates.-,
That the Commission is authorized and empowered, and it
shall be its duty, whenever, after full hearing upon a complaint
made as provided in section thirteen of this Act, or upon com-
plaint of any common carrier, it shall be of the opinion that
any of the rates, or charges whatsoever, demanded, charged,
or collected by any common carrier or carriers, subject to the
provisions of this Act, for the transportation of persons or
property as defined in the first section of this Act, or that any
regulations or practices whatsoever of such carrier or carriers
affecting such rates, are unjust or unreasonable, or unjustly
discriminatory, or unduly preferential or prejudicial, or other-
wise in violation of any of the provisions of this Act, to deter-
mine and prescribe what will be the just and reasonable rate
or rates, charge or charges, to be thereafter observed in such
case as the maximum to be charged: and what regulation or
practice in respect to such transportation is just, fair, and
22
COMMERCE ACT SEC. 15.
reasonable to be thereafter followed; and to make an order
that the carrier shall cease and desist from such violation, to
the extent to which the Commission find the same to exist, and
shall not thereafter publish, demand, or collect any rate or
charge for such transportation in excess of the maximum rate
or charge so prescribed, and shall conform to the regulation or
practice so prescribed. (Rearranged and power to fix rates
added by Act of June 29, 1906.)
Sec. 15. Commerce Act Continued When Order of
Commission takes Effect Supplemental Order, Joint
Rates.-.All orders of the Commission, except orders for
the payment of money, shall take effect within such reasonable
time, not less than thirty days, and shall continue in force for
such period of time, not exceeding two years, as shall be pre-
scribed in the order of the Commission, unless the same shall
be suspended or modified or set aside by the Commission or be
suspended or set aside by a court of competent jurisdiction.
Whenever the carrier or carriers, in obedience to such order
of the Commission or otherwise, in respect to joint rates, fares,
or charges, shall fail to agree among themselves upon the ap-
portionment or division thereof, the Commission may after
hearing make a supplemental order prescribing the just and
reasonable proportion of such joint rate to be received by each
carrier party thereto, which order shall take effect as a part of
the original order. (New provision added by Act of June 29,
1906.)
The Commission may also, after hearing on a complaint,
establish through routes and joint rates as the maximum to
be charged and prescribe the division of such rates as herein-
before provided, and the terms and conditions under which
such through routes shall be operated, when that may be neces-
sary to give effect to any provision of this Act, and the carriers
complained of have refused or neglected to voluntarily establish
such through routes and joint rates, provided no reasonable
or satisfactory through route exists, and this provision shall
PAYMENT BY CARRIER · ORDERS.
23
apply when one of the connecting carriers is a water line.
(New Provision added by Act of June 29, 1906.)
Sec. 15. Commerce Act Continued Payment by Car-
rier for Services and Instrumentalities. If the owner of
property transported under this Act directly or indirectly ren-
ders any service connected with such transportation, or fur-
nishes any instrumentality used therein, the charge and allow-
ance therefor shall be no more than is just and reasonable, and
the Commission may, after hearing on a complaint, determine
what is a reasonable charge as the maximum to be paid by the
carrier or carriers for the service so rendered or for the use
of the instrumentality so furnished, and fix the same by ap-
propriate order, which order shall have the same force and
effect and be enforced in like manner as the orders above
provided for in this section.
The foregoing enumeration of powers shall not exclude any
power which the Commission would otherwise have in the
making of an order under the provisions of this Act. (New:
Provision added by Act of June 29, 1906.)
Sec. 16. Commerce Act Order for Damages, how En-
forced Findings of Commission Prima Facie Evidence.—
That if, after hearing on a complaint made as provided in
section thirteen of this Act, the Commission shall determine
that any party complainant is entitled to an award of damages
under the provisions of this Act for a violation thereof, the
Commission shall make an order directing the carrier to pay
to the complainant the sum to which he is entitled on or before
a day named.
If a carrier does not comply with an order for the payment
of money within the time limit in such order, the complainant,
or any person for whose benefit such order was made, may
file in the circuit court of the United States for the district in
which he resides or in which is located the principal operating
office of the carrier, or through which the road of the carrier.
runs, a petition setting forth briefly the causes for which he
24
COMMERCE ACT- SEC. 16.
claims damages, and the order of the Commission in the
premises. Such suit shall proceed in all respects like other
civil suits for damages, except that on the trial of such suit
the findings and order of the Commission shall be prima facie
evidence of the facts therein stated, and except that the peti-
tioner shall not be liable for costs in the circuit court nor for
costs at any subsequent stage of the proceedings unless they
accrue upon his appeal. If the petitioner shall finally prevail
he shall be allowed a reasonable attorney's fee, to be taxed and
collected as a part of the costs of the suit. (Rearranged by
Act of June 29, 1906.)
Sec. 16. Commerce Act Continued
Damage Claims to
be Filed within two Years.- All complaints for the recov-
ery of damages shall be filed with the Commission within two
years from the time the cause of action accrues, and not after,
and a petition for the enforcement of an order for the payment
of money shall be filed in the circuit court within one year from
the date of the order, and not after: Provided, That claims
accrued prior to the passage of this Act may be presented
within one year. (New Provision added by Act of June 29,
1906.)
Sec. 16. Commerce Act Continued Damage Claims -
Parties. In such suits all parties in whose favor the
Commission may have made an award for damages by a single
order may be joined as plaintiffs, and all of the carriers parties
to such order awarding such damages may be joined as defend-
ants, and such suit may be maintained by such joint plaintiffs
and against such joint defendants in any district where any one
of such joint plaintiffs could maintain such suit against any
one of such joint defendants; and service of process against
any one of such defendants as may not be found in the district
where the suit is brought may be made in any district where
such defendant carrier has its principal operating office. In
case of such joint suit the recovery, if any, may be by judgment
in favor of any one of such plaintiffs, against the defendant
ORDERS OF COMMISSION
HOW ENFORCED.
25
found to be liable to such plaintiff. (Rearranged by Act of
June 29, 1906.)
Order
How
Sec. 16. Commerce Act Continued
Served-Modification, or Suspension of.- Every order of the
Commission shall be forthwith served by mailing to any one of
the principal officers or agents of the carrier at his usual place
of business a copy thereof; and the registry mail receipt shall
be prima facie evidence of the receipt of such order by the
carrier in due course of mail.
The Commission shall be authorized to suspend or modify
its orders upon such notice and in such manner as it shall deem
proper.
It shall be the duty of every common carrier, its agents and
employees, to observe and comply with such orders so long as
the same shall remain in effect. (Rearranged by Act of June
29, 1906.)
Sec. 16. Commerce Act Continued Orders how En-
forced Penalties and Forfeitures.- Any carrier, any
officer, representative, or agent of a carrier, or any receiver,
trustee, lessee, or agent of either of them, who knowingly fails
or neglects to obey any order made under the provisions of
section fifteen of this Act, shall forfeit to the United States
the sum of five thousand dollars for each offense. Every dis-
tinct violation shall be a separate offense, and in case of a
continuing violation each day shall be deemed a separate of-
fense.
The forfeiture provided for in this Act shall be payable into
the Treasury of the United States, and shall be recoverable in
a civil suit in the name of the United States, brought in the
district where the carrier has its principal operating office, or
in any district through which the road of the carrier runs.
·
It shall be the duty of the various district attorneys, under
the direction of the Attorney-General of the United States, to
prosecute for the recovery of forfeitures. The costs and ex-
penses of such prosecution shall be paid out of the appropria-
Ju
26
SEC. 16.
COMMERCE ACT
tion for the expenses of the courts of the United States. The
Commission may, with the consent of the Attorney-General,
employ special counsel in any proceeding under this Act, paying
the expenses of such employment out of its own appropriation.
(New Provision added by Act of June 29, 1906.)
Sec. 16. Commerce Act Continued - When Orders En-
force by Injunction.- If any carrier fails or neglects to
obey any order of the Commission, other than for the pay-
ment of money, while the same is in effect, any party in-
jured thereby, or the Commission in its own name, may
apply to the circuit court in the district where such carrier
has its principal operating office, or in which the violation
or disobedience of such order shall happen, for an enforce-
ment of such order. Such application shall be by peti-
tion, which shall state the substance of the order and
the respect in which the carrier has failed of obedience, and
shall be served upon the carrier in such manner as the court
may direct, and the court shall prosecute such inquiries and
make such investigations, through such means as it shall deem
needful in the ascertainment of the facts at issue or which may
arise upon the hearing of such petition. If, upon such hearing
as the court may determine to be necessary, it appears that the
order was regularly made and duly served, and that the carrier
is in disobedience of the same, the court shall enforce obedience
to such order by a writ of injunction, or other proper process,
mandatory or otherwise, to restrain such carrier, its officers,
agents, or representatives, from further disobedience of such
order, or to enjoin upon it, or them, obedience to the same;
and in the enforcement of such process the court shall have
those powers ordinarily exercised by it in compelling obedience
to its writs of injunction and mandamus. (Rearranged by
Act of June 29, 1906.)
Sec. 16. Commerce Act Continued Appeal, Venue -
Provisions as to Court Review. From any action upon
such petition an appeal shall lie by either party to the Supreme
COURT REVIEW.
27
Court of the United States, and in such court the case shall
have priority in hearing and determination over all other
causes except criminal causes, but such appeal shall not vacate
or suspend the order appealed from.
The venue of suits brought in any of the circuit courts of
the United States against the Commission to enjoin, set aside,
annul, or suspend any order or requirement of the Commission
shall be in the district where the carrier against whom such
order or requirement may have been made has its principal
operating office, and may be brought at any time after such
order is promulgated. And if the order or requirement has
been made against two or more carriers then in the district
where any one of said carriers has its principal operating office,
and if the carrier has its principal operating office in the Dis-
trict of Columbia then the venue shall be in the district where
said carrier has its principal office; and jurisdiction to hear and
determine such suits is hereby vested in such courts. The
provisions of " An Act to expedite the hearing and determina-
tion of suits in equity, and so forth," approved February
eleventh, nineteen hundred and three,* shall be, and are hereby.
made applicable to all such suits, including the hearing on an
application for a preliminary injunction, and are also made
applicable to any proceeding in equity to enforce any order
or requirement of the Commission, or any of the provisions
of the Act to regulate commerce approved February fourth,
eighteen hundred and eighty-seven, and all Acts amendatory
thereof or supplemental thereto. It shall be the duty of the
Attorney-General in every such case to file the certificate pro-
vided for in said expediting Act of February eleventh, nine-
teen hundred and three, as necessary to the application of the
provisions thereof, and upon appeal as therein authorized to
the Supreme Court of the United States, the case shall have in
such court priority in hearing and determination over all other
causes except criminal causes: Provided, That no injunction,
*For text of the Expediting Act of February 11, 1903, see Synder's
Interstate Commerce Act, page 219.
28
SECS. 16, 16a.
COMMERCE ACT
interlocutory order or decree suspending or restraining the
enforcement of an order of the Commission shall be granted.
except on hearing after not less than five days' notice to the
Commission. An appeal may be taken from any interlocutory
order or degree granting or continuing an injunction in any
suit, but shall lie only to the Supreme Court of the United
· States: Provided further, That the appeal must be taken within
thirty days from the entry of such order or decree and it shall
take precedence in the appellate court over all other causes,
except causes of like character and criminal causes. (Rear-
ranged by Act of June 29, 1906.
Schedules filed
Sec. 16. Commerce Act Continued
Prima Facie Evidence. The copies of schedules and tar-
iffs of rates, fares, and charges, and of all contracts, agree-
ments, or arrangements between common carriers filed with
the Commission as herein provided, and the statistics, tables,
and figures contained in the annual reports of carriers made to
the Commission, as required by the provisions of this Act,
shall be preserved as public records in the custody of the secre-
tary of the Commission, and shall be received as prima facie
evidence of what they purport to be for the purpose of investi-
gations by the Commission and in all judicial proceedings; and
copies of or extracts from any of said schedules, tariffs, con-
tracts, agreements, arrangements, or reports made public
records as aforesaid, certified by the secretary under its seal,
shall be received in evidence with like effect as the originals.
(Rearranged by Act of June 29, 1906.)
Sec. 16a. Commerce Act Application for Re-hearing.—
That after a decision, order, or requirement has been made by
the Commission in any proceeding any party thereto may at
any time make application for rehearing of the same, or any
matter determined therein, and it shall be lawful for the Com-
mission in its discretion to grant such a rehearing if sufficient
reason therefor be made to appear. Applications for rehearing
shall be governed by such general rules as the Commission may
PROCEDURE BEFORE COMMISSION.
29
establish. No such application shall excuse any carrier from
complying with or obeying any decision, order, or requirement
of the Commission, or operate in any manner to stay or post-
pone the enforcement thereof, without the special order of
the Commission. In case a rehearing is granted the proceed-
ings thereupon shall conform as nearly as may be to the pro-
ceedings in an original hearing, except as the Commission may
otherwise direct; and if, in its judgment, after such rehearing
and the consideration of all facts, including those arising since
the former hearing, it shall appear that the original decision,
order, or requirement is in any respect unjust or unwarranted,
the Commission may reverse, change, or modify the same ac-
cordingly. Any decision, order, or requirement made after
such rehearing, reversing, changing, or modifying the original
determination shall be subject to the same provisions as an
original order. (New Section added by Act of June 29, 1906.)
Sec. 17. Commerce Act Procedure before Interstate
Commerce Commission. That the Commission may con-
duct its proceedings in such manner as will best conduce to the
proper dispatch of business and to the ends of justice. A
majority of the Commission shall constitute a quorum for the
transaction of business, but no Commissioner shall participate
in any hearing or proceeding in which he has any pecuniary
interest. Said Commission may, from time to time, make or
amend such general rules or orders as may be requisite for the
order and regulation of proceedings before it, including forms
of notices and the service thereof, which shall conform, as
nearly as may be, to those in use in the courts of the United
States. Any party may appear before said Commission and
be heard, in person or by attorney. Every vote and official act
of the Commission shall be entered of record, and its pro-
ceedings shall be public upon the request of either party inter-
ested. Said Commission shall have an official seal, which shall
be judicially noticed. Either of the members of the Commis-
sion may administer oaths and affirmations and sign subpœnas,
(As amended March 2, 1889.)
Sec. 18. Commerce Act - Salary of Commission Fees
and Expenses.-[That each Commissioner shall receive an
annual salary of seven thousand five hundred dollars, payable
in the same manner as the judges of the courts of the United
30
COMMERCE ACT SECS. 19, 20.
States.]* The Commission shall appoint a secretary, who shall
receive an annual salary of three thousand five hundred dollars,
payble in like manner. The Commission shall have author-
ity to employ and fix the compensation of such other employees
as it may find necessary to the proper performance of its duties.
Until otherwise provided by law, the Commission may hire
suitable offices for its use, and shall have authority to procure
all necessary office supplies. Witnesses summoned before the
Commission shall be paid the same fees and mileage that are
paid witnesses in the courts of the United States.
All the expenses of the Commission, including all necessary
expenses for transportation incurred by the Commissioners, or
by their employees under their orders, in making any investi-
gation, or upon official business in any other places than in
the city of Washington, shall be allowed and paid on the
presentation of itemized vouchers therefor approved by the
chairman of the commission. (Amended March 2, 1889.)
Sec. 19. Commerce Act Sessions of Commission,
Where held. That the principal office of the Commission
shall be in the city of Washington, where its general sessions
shall be held; but whenever the convenience of the public or the
parties may be promoted or delay or expense prevented thereby,
the Commission may hold special sessions in any part of the
United States. It may, by one or more of the Commissioners,
prosecute any inquiry necessary to its duties, in any part of
the United States, into any matter or question of fact pertain-
ing to the business of any common carrier subject to the pro-
visions of this Act.
Contents
Sec. 20. Commerce Act - Annual Reports
Unformity. That the Commission is hereby authorized to
require annual reports from all common carriers subject to the
provisions of this Act, and from the owners of all railroads
engaged in interstate commerce as defined in this Act, to pre-
scribe the manner in which such reports shall be made, and to
require from such carriers specific answers to all questions
upon which the Commission may need information. Such
annual reports shall show in detail the amount of capital stock
issued, the amounts paid therefor, and the manner of payment.
for the same; the dividends paid, the surplus fund, if any,
*The salary of the Commission, as provided in Sec. 18 of the Com-
merce Act was increased by the Act approved June 29, 1906, which
added Sec. 24 to the Act, enlarging the Commission to seven members.
See Sec. 24, post, page 37.
REPORTS OF CARRIERS.
31
and the number of stockholders; the funded and floating debts
and the interest paid thereon; the cost and value of the car-
rier's property, franchises, and equipments; the number of
employees and the salaries paid each class; the accidents to
passengers, employees, and other persons, and the causes there-
of; the amounts expended for improvements each year, how
expended, and the character of such improvements; the earn-
ings and receipts from each branch of business and from all
sources; the operating and other expenses; the balances of
profit and loss; and a complete exhibit of the financial opera-
tions of the carrier each year, including an annual balance
sheet. Such reports shall also contain such information in
relation to rates or regulations concerning fares or freights,
or agreements, arrangements, or contracts affecting the same
as the Commission may require; and the Commission may, in
its discretion, for the purpose of enabling it the better to carry
out the purposes of this Act, prescribe a period of time within
which all common carriers subject to the provisions of this Act
shall have, as near as may be, a uniform system of accounts,
and the manner in which such accounts shall be kept.*
Said detailed reports shall contain all the required statistics
for the period of twelve months ending on the thirtieth day of
June in each year, and shall be made out under oath and filed
with the Commission, at its office in Washington, on or before
the thirtieth day of September then next following, unless
additional time be granted in any case by the Commission; and
if any carrier, person, or corporation subject to the provisions.
of this Act shall fail to make and file said annual reports within
the time above specified, or within the time extended by the
Commission for making and filing the same, or shall fail to
make specific answer to any question authorized by the pro-
visions of this section within thirty days from the time it is
lawfully required so to do, such parties shall forfeit to the
United States the sum of one hundred dollars for each and
every day it shall continue to be in default with respect thereto.
* The remainder of the provisions of section 20 are new and were
added by Act of June 29, 1906.
32
SEC. 20.
COMMERCE ACT
The Commission shall also have authority to require said
carriers to file monthly reports* of earnings and expenses or
special reports within a specified period, and if any such
carrier shall fail to file such reports within the time fixed by
the Commission it shall be subject to the forfeitures last above
provided. (New Provision added by Act of June 29, 1906.)
Said forfeitures shall be recovered in the manner provided
for the recovery of forfeitures under the provisions of this Act.
The oath required by this section may be taken before any
person authorized to administer an oath by the laws of the
State in which the same is taken. (New. Added by Act of
June 29, 1906.)
Sec. 20. Commerce Act Continued — Uniform Books and
Accounts of Carriers, When Compulsory.- The Commis-
sion may, in its discretion, prescribe the forms of any and
all accounts, records, and memoranda to be kept by car-
riers subject to the provisions of this Act, including the
accounts, records, and memoranda of the movement of
traffic as well as the receipts and expenditures of moneys.
The Commission shall at all times have access to all
accounts, records, and memoranda kept by carriers sub-
ject to this Act, and it shall be unlawful for such carriers
to keep any other accounts, records, or memoranda than
those prescribed or approved by the Commission, and it
may employ special agents or examiners, who shall have
authority under the order of the Commission to inspect and
examine any and all accounts, records and memoranda kept by
such carriers. This provision shall apply to receivers of car-
riers and operating trustees. (New Provision added by 'Act of
June 29, 1906.)
In case of failure or refusal on the part of any such carrier,
receiver, or trustee to keep such accounts, records, and memo-
randa on the books and in the manner prescribed by the Com-
mission, or to submit such accounts, records, and memoranda
*This provision which was added to Sec. 20, of the Commerce Act,
should be read in connection with the Act of March 3, 1901, requiring
common carriers to make monthly reports of accidents. For this Act see
Snyder's Interstate Commerce Act, page 229.
FALSE BOOKS MANDAMUS.
33
as are kept to the inspection of the Commission or any of its
authorized agents or examiners, such carrier, receiver, or
trustee shall forfeit to the United States the sum of five hun-
dred dollars for each such offense and for each and every day
of the continuance of such offense, such forfeitures to be re-
coverable in the same manner as other forfeitures provided for
in this Act.
Any person who shall willfully make any false entry in the
accounts of any book of accounts or in any record or memo-
randa kept by a carrier, or who shall willfully destroy, mutilate,
alter, or by any other means or device falsify the record of any
such account, record, or memoranda, or who shall willfully
neglect or fail to make full, true, and correct entries in such
accounts, records, or memoranda of all facts and transactions.
appertaining to the carrier's business, or shall keep any other
accounts, records, or memoranda than those prescribed or
approved by the Commission, shall be deemed guilty of a mis-
demeanor and shall be subject, upon conviction in any court of
the United States of competent jurisdiction, to a fine of not
less than one thousand dollars nor more than five thousand
dollars, or imprisonment for a term not less than one year nor
more than three years, or both such fine and imprisonment.
Any examiner who divulges any fact or information which
may come to his knowledge during the course of such examina-
tion, except in so far as he may be directed by the Commission
or by a court or judge thereof, shall be subject, upon conviction
in any court of the United States of competent jurisdiction, to
a fine of not more than five thousand dollars or imprisonment
for a term not exceeding two years, or both. (New. Added
by Act of June 29, 1906.)
Sec. 20. Commerce Act Continued Mandamus on Ap-
plication of Commission or Attorney-General.— That the
circuit and district courts of the United States shall have
jurisdiction, upon the application of the Attorney-General of
the United States at the request of the Commission, alleging
a failure to comply with or a violation of any of the provisions.
34
COMMERCE ACT SEC. 20.
of said Act to regulate commerce or of any Act supplementary
thereto or amendatory thereof by any common carrier, to issue
a writ or writs of mandamus* commanding such common car-
rier to comply with the provisions of said Acts, or any of them.
And to carry out and give effect to the provisions of said
Acts, or any of them, the Commission is hereby authorized to
employ special agents or examiners who shall have power to
administer oaths, examine witnesses, and receive evidence.
(New. Added by Act Approved June 29, 1906.)
Sec. 20. Commerce Act Continued Bill of Lading Com-
pulsory - Initial Carrier Liable for Damages. That any
common carrier, railroad, or transportation company receiving
property for transportation from a point in one State to a point
in another State shall issue a receipt or bill of lading therefor
and shall be liable to the lawful holder thereof for any loss,
damage, or injury to such property caused by it or by any
common carrier, railroad, or transportation company to which
such property may be delivered or over whose line or lines such
property may pass, and no contract, receipt, rule, or regulation
shall exempt such common carrier, railroad, or transportation
company from the liability hereby imposed: Provided, That
nothing in this section shall deprive any holder of such receipt
or bill of lading of any remedy or right of action which he has
under existing law. (New. Added by Act Approved June
29, 1906.)
That the common carrier, railroad, or transportation com-
pany issuing such receipt or bill of lading shall be entitled to
recover from the common carrier, railroad, or transportation
company on whose line the loss, damage, or injury shall have
been sustained the amount of such loss, damage, or injury as
it may be required to pay to the owners of such property, as
may be evidenced by any receipt, judgment, or transcript
thereof. (New. Added by Act Approved June 29, 1906.)
*The writ of mandamus, prior to the amendment of June 29, 1906,
was authorized to compel the filing of schedules under section 6. Under
section 20 as amended the writ is authorized to compel obedience to
any requirement of the Commerce Act, or of the Elkins Act, or
acts supplementary thereto.
&
REPORTS FREE TRANSPORTATION.
:35
Sec. 21.- Commerce Act Commission to Make An-
nual Reports to Congress.-That the Commission shall, on
or before the first day of December in each year, make a re-
port, which shall be transmitted to Congress, and copies of
which shall be distributed as are the other reports transmitted
to Congress. This report shall contain such information and
data collected by the Commission as may be considered of
value in the determination of questions connected with the
regulation of commerce, together with such recommendations
as to additional legislation relating thereto as the Commission
may deem necessary; and the names and compensation of the
persons employed by said Commission. (As amended March
2, 1889.)
Sec. 22. Commerce Act Free or Reduced Rates Ex-
cursions Mileage Commutation Rates Remedies
Cumulative.-*That nothing in this act shall prevent the
carriage, storage, or handling of property free or at reduced
rates for the United States, State, or municipal governments,
or for charitable purposes, or to or from fairs and expositions
for exhibition thereat, or the free carriage of destitute and
homeless persons transported by charitable societies, and the
necessary agents employed in such transportation, or the is-
suance of mileage, excursion, or commutation passenger tick-
ets; nothing in this act shall be construed to prohibit any com-
mon carrier from giving reduced rates to ministers of religion,"
or to municipal governments for the transportation of indigent
persons, or to inmates of the National Homes or State Homes
for Disabled Volunteer Soldiers, and of Soldiers' and Sailors'
Orphan Homes, including those about to enter and those re-
turning home after discharge, under arrangements with the
boards of managers of said homes.
Nothing in this act shall be construed to prevent railroads
from giving free carriage to their own officers and employees,
or to prevent the principal officers of any railroad company or
companies from exchanging passes or tickets with other rail-
road companies for their officers and employees; and nothing
in this act contained shall in any way abridge or alter the rem-
edies now existing at common law or by statute, but the provi-
sions of this act are in addition to such remedies: Provided,
That no pending litigation shall in any way be affected by this
(As amended March 2, 1889.)
act.
Provided, further, That nothing in this act shall prevent the
issuance of joint interchangeable five-thousand mile tickets,
* This Section has been partly re-enacted by new provisions on the
same subject embraced in Section 1 of the Commerce Act, and should
be read in connection therewith. See Sec. 1, ante, page 3. Where the
provisions are inconsistent, Section I governs.
36
COMMERCE ACT — SEC. 23.
with special privileges as to the amount of free baggage that
may be carried under mileage tickets of one thousand or more
miles.
But before any common carrier, subject to the provisions of
this act, shall issue any such joint interchangeable mileage
tickets with special privileges, as aforesaid, it shall file with
the Interstate Commerce Commission copies of the joint tariffs
of rates, fares, or charges on which such joint interchangeable
mileage tickets are to be based, together with specifications
of the amount of free baggage permitted to be carried under
such tickets, in the same manner as common carriers are
required to do with regard to other joint rates by section six
of this act; and all the provisions of said section six relating to
joint rates, fares, and charges shall be observed by said com-
mon carriers and enforced by the Interstate Commerce Com-
mission as fully with regard to such joint interchangeable mile-
age tickets, as with regard to other joint rates, fares, and
charges referred to in said section six. It shall be unlawful
for any common carrier that has issued or authorized to be is-
sued any such joint interchangeable mileage tickets to demand,
collect, or receive from any person or persons a greater or less
compensation for transportation of persons or baggage under
such joint interchangeable mileage tickets than that required
by the rate, fare, or charge specified in the copies of the joint
tariff of rates, fares, or charges filed with the Commission in
force at the time. The provisions of section ten of this act
shall apply to any violation of the requirements of this proviso.
(Added by Laws 1895, chap. 61; approved February 8, 1895.)
Sec. 23. Commerce Act Remedy by Mandamus to
Move Traffic or Furnish Cars.- That the circuit and dis-
trict courts of the United States shall have jurisdiction upon
the relation of any person or persons, firm, or corporation,
alleging such violation by a common carrier, of any of the
provisions of the act to which this is a supplement and all acts
amendatory thereof, as prevents the relator from having inter-
state tarffic moved by said common carrier at the same rates as
are charged, or upon terms or conditions as favorable as those
given by said common carrier for like traffic under similar con-
ditions to any other shipper, to issue a writ or writs or manda-
mus against said common carrier, commanding such common
carrier to move and transport the traffic, or to furnish cars or
other facilities for transportation for the party applying for
the writ: Provided, That if any question of fact as to the
proper compensation to the common carrier for the service to
be enforced by the writ is raised by the pleadings, the writ of
COMMERCE COMMISSION ENLARGED.
37
peremptory mandamus may issue, notwithstanding such ques-
tion of fact is undetermined, upon such terms as to security,
payment of money into the court, or otherwise, as the court
may think proper, pending the determination of the question
of fact: Provided, That the remedy hereby given by writ of
mandamus shall be cumulative, and shall not be held to exclude
or interfere with other remedies provided by this act or the
act to which it is a supplement. (New section added March
2, 1889, being section 10 of chap. 382; approved March 2,
1889.)
Commission Enlarged Sal-
-
Sec. 24. Commerce Act
aries Term of Office.— That the Interstate Commerce
Commission is hereby enlarged so as to consist of seven mem-
bers with terms of seven years, and each shall receive ten
thousand dollars compensation annually. The qualifications of
the Commissioners and the manner of the payment of their
salaries shall be as already provided by law. Such enlarge-
ment of the Commission shall be accomplished through ap-
pointment by the President, by and with the advice and con-
sent of the Senate, of two additional Interstate Commerce
Commissioners, one for a term expiring December thirty-first,
nineteen hundred and eleven, one for a term expiring Decem-
ber thirty-first, nineteen hundred and twelve. The terms of
the present Commissioners, or of any successor appointed to
fill a vacancy caused by the death or resignation of any of the
present Commissioners, shall expire as heretofore provided by
law. Their successors and the successors of the additional
Commissioners herein provided for shall be appointed for the
full term of seven years, except that any person appointed to
fill a vacancy shall be appointed only for the unexpired term
of the Commissioner whom he shall succeed. Nor more than
four Commissioners shall be appointed from the same political
party.
Sec. 9. Act of June 29, 1906 Application of Existing
Laws. That all existing laws relating to the attendance of
witnesses and the production of evidence and the compelling
of testimony under the Act to regulate commerce and all Acts
38 ACT JUNE 29, 1906, APPLICATION OF REPEALER.
amendatory thereof shall apply to any and all proceedings and
hearings under this Act.
Sec. 10.
Act of June 29, 1906
-Repealed. That all
laws and parts of laws in conflict with the provisions of this
Act are hereby repealed, but the amendments herein provided
for shall not affect causes now pending in courts of the United
States, but such causes shall be prosecuted to a conclusion in
the manner heretofore provided by law.
Sec. 11.
II.
Act of June 29, 1906-Act to Take Effect.-
That this Act shall take effect, and be in force from and after
its passage.
Resolution June 29, 1906
Passage.
Act in effect sixty days after
Section II of the Act of June 29, 1906 amend-
ing the Commerce Act, provided that the Act should take ef-
fect and be in force from and after its passage.
day the following joint resolution was passed:
On the same
Resolved, etc., That the Act entitled "An Act to amend an Act en-
titled 'An Act to regulate commerce,' approved February 4, 1887, and
all acts amendatory thereof, and to enlarge the powers of the Interstate
Commerce Commission," shall take effect and be in force sixty days
after its approval by the President of the United States.
CHAPTER TWO.
COMMENT AND AUTHORITIES.
DECISIONS SINCE JULY, 1904.
The authorities cited in this chapter include those reported to and
including 201 U. S. Reports, and 143 Federal Reporter.
I. Constitutional Limitations
Police Power.
Sumptuary Laws -
II. Constitutional Limitations-Immunity.
III. Commerce Act-Elkins Act-Pooling Rebates-
Discrimination.
IV. Commerce Act- Carrier Cannot be Dealer.
V. Imprisonment - Crimes and Conspiracies.
VI. Commerce Act-Mandamus.
VII. Commerce Act Jurisdiction
edies Procedure.
-
Evidence Rem-
VIII. Criminal Trusts Under Sherman Act.
IX. State Anti-Trust Laws Enumerated.
X. Safety Appliance Law.
XI. Telegraph Companies.
I. CONSTITUTIONAL LIMITATIONS
POLICE Power.
SUMPTUARY LAWS
§ 1. Interstate Commerce - Original Package, What
Constitutes. The term "original package" is not defined by
statute. Its size and shape cannot always be determined by
judicial authority, so as to bring it within the protection of
the commerce clause of the Constitution, exempting inter-
state commerce from State legislation. The term "original
package," however, does not include packages which cannot
be commercially transported from one State to another.
Where a person transporting goods selects an unusual
method for the express purpose of evading or defying the
police laws of another State, the commerce clause of the
40
COMMENT AND AUTHORITIES.
Constitution cannot be invoked to protect the fraudulent
transaction. (Cook v. Marshall County, 196 U. S. 261.)
In the case cited there was an attempt by the shipper to
introduce cigarettes in packages into the State of Iowa, to
evade the provision of the Iowa statute (Code, § 5007), im-
posing a tax of $300 upon every person, and also upon real
property of the owner thereof, upon which property cigarettes
are sold or kept for sale. Cigarettes were shipped by the
American Tobacco Company from St. Louis into the State
of Iowa to the plaintiffs' place of business in small paste-
board boxes, containing ten cigarettes each, each package
being sealed and stamped with the revenue stamp. The
packages were shipped loose, were not boxed, baled, wrapped,
or covered, nor were they in any way attached together. The
court inferred that they were shuffled into and out of the
cars and delivered to plaintiffs in that condition. The court
held, following the decision in Austin v. Tennessee, 179
U. S. 343, that the cigarettes were shipped in a manner
clearly intended to evade the laws of the State of Iowa, and
that the condition in which they were sent did not constitute
original packages within the meaning of the Federal de-
cisions, and were not protected under the commerce clause of
the Constitution, from regulation by the police power of the
State. (Cook v. Marshall County, 196 U. S. 261.)
§ 2. Interstate Commerce-When State Liquor Laws
not Operative as to.- Under the Wilson Act (passed Au-
gust 8, 1890), all fermented, distilled, or other intoxicating
liquors transported into any State or remaining therein for
use, consumption, sale, or storage are, upon arrival in such
State, subject to the operation and effect of the laws of the
State to which they are shipped and subject to the police
powers of such State, to the same extent as domestic prop-
erty therein, whether such liquors are transported in original
packages or otherwise. A State, however, has no power to
destroy contracts concerning interstate commerce, valid in
the State where the contract was made, and the citizens of
one State may freely contract to receive merchandise sent
SUMPTUARY LAWs.
41
from another State, under the constitutional provision which
guarantees freedom of commerce between the States. The
parties to such a contract have a right to fix the time when,
and condition on which, completed title shall pass. Packages
of intoxicating liquor were received by the American Ex-
press Company at Rock Island, Ill., to be carried to Tama,
Iowa, there to be delivered to four different consignees, one
package being consigned to each. The shipments were made
C. O. D., $3 to be collected on each package, exclusive of
thirty-five cents for carriage on each. Under the prohibition
statutes of Iowa, the goods were seized in the hands of the
express agent before delivery. The court held, reversing the
Supreme Court of Iowa, that the seizure of the liquor in the
hands of the express company was an unwarranted inter-
ference with interstate commerce, and that, until the goods
were delivered to the respective consignees, they did not be-
come subject to the police power of the State of Iowa. The
commerce clause of the Constitution protects interstate trans-
portation and exempts from State interference a shipment
of liquors, imported into a State, until the contract of ship-
ment, or the act of interstate transportation is fully per-
formed and consummated by delivery to the consignee. Such
delivery marks the first point of time at which the goods
become subjected to State control as being commingled in the
general mass of property within the State, and then only is
there a subject upon which the police power of the State can
operate. (American Express Company v. Iowa, 196 U. S.
133.)
The court observed that the question as to whether a ship-
ment of property C. O. D. is complete by delivery to the
carrier for transportation, or whether the sale is not con-
summated until the payment of the price and delivery to the
consignee, was not material. The contract to sell and ship
was completed in Illinois. The right of the parties to make
a contract in Illinois for the sale and purchase of merchan-
dise, and to fix by agreement the time when the title should
pass, was undoubted; and the shipment from the State of
Illinois into the State of Iowa of the merchandise consti-
tuted interstate commerce. The law of Iowa, therefore,
42
COMMENT AND AUTHORITIES.
could not operate in the State of Illinois, so as to invalidate
a lawful contract of interstate commerce made there. A
citizen of one State has a right to have merchandise con-
signed from another State and delivered to him as consignee.
Such transactions are protected by the commerce clause of
the Constitution. (American Express Company v. Iowa,
196 U. S. 133.)
The court, in its opinion, reviewed the following au-
thorities: Bowman v. Chicago & N. W. Ry. Co., 125
U. S. 465; Leisy v. Hardin, 135 U. S. 100; Rhodes v. Iowa,
170 U. S. 112; Vance v. Vandercook Co., No. 1, 170 U. S.
438; Norfolk & Western R. R. Co. v. Simms, 191 U. S. 441;
Caldwell v. North Carolina, 187 U. S. 632; American Steel
& Wire Co. v. Speed, 192 U. S. 500.
§ 3. Interstate Commerce-When Sale of Liquors is
not.—A State may impose a license fee as a condition to the
right to sell intoxicating liquors over the bar on board a
steamboat, used as a ferry-boat, while the boat is within the
boundaries of the State, notwithstanding that such boat, ply-
ing the waters in the Mississippi river, may be engaged in
interstate commerce. Such a license fee may be imposed by
the State in the exercise of its police power. It cannot be
said that the license is a tax upon the boat, the crew, the
passengers, or the liquor sold, nor a fee for navigating the
river, because the liquors are not consigned nor sold in
original packages, transported from one State to be delivered
to a consignee in another State, and that such a license was
not a tax upon interstate commerce. (Foppiano v. Speed,
199 U. S. 501.)
The court held that since the passage of the Wilson Act,
August 8, 1890, there was a distinction between the right to
sell intoxicating liquors on vessels engaged in interstate com-
merce and other business conducted on such vessel. Under
the Wilson Act the law of a particular State operates upon
intoxicating liquors as to the regulation of their sale and
disposition, after they had been delivered to the consignee.
After such delivery, the State has power to prevent the sale
of the liquors, even in original packages, unless consigned to
SUMPTUARY LAWS
43
If the liquor
a specific individual for private con ampt
kept for sale on the bar of the ferry-boat La been consigned
to the plaintiff in error from Arkansas addressed to him in
Memphis, Tenn., though the plaintiff would have the right
to the delivery of the liquors to him at the wharf in Mem-
phis, yet, under the act of Congress, the State of Tennessee
could have prohibited absolutely the sale thereof, even in
original packages. If, therefore, the State of Tennessee
could totally prohibit such sale, it could permit such sale
conditionally. The liquors were owned by the plaintiff in
error, while on the boat, and carried along from port to port
to be used on the boat as the demand at the bar made neces-
sary. What the plaintiff in error did was to sell intoxicating
liquors on this ferry-boat, anchored temporarily on the wharf
at Memphis, within the boundaries of the State of Tennessee,
to persons on the boat, and by reason of such sales the laws
of Tennessee required the plaintiff to take out a license and
pay the tax therefor. The case is as if plaintiff had received
a consignment of liquor from outside the State, and sold
portion of it within the State to different persons on the
boat. The State of Tennessee did not tax the liquor, but
compelled the plaintiff to get a license to sell it within the
State. The only person liable for the payment of this tax
was the seller of the liquor. It was, therefore, not a tax
upon the officers or crew of the boat, nor in payment of any
fees for navigating the river. The court further said that,
in view of all the facts, there was no merit in the contention
that the Mississippi river was a public highway and that the
boat, being personal property, owned by a corporation in
Arkansas, was Arkansas territory, and exempt from the
police regulations of Tennessee while within the boundaries
of the latter State. (Foppiano v. Speed, 199 U. S. 501.)
§ 4.
Interstate Commerce Sale of Liquors -
Wilson Act Construed.- A State statute which operates.
upon beer and malt liquors shipped from other States after
their arrival and while held for sale or consumption within
the State is not an interference with interstate commerce,
and is an inspection law and not a revenue law in view of
44
COMMENT AND AUTHORITIES.
the provisions of the Wilson Act. So held sustaining laws
of Missouri, authorizing an inspector for the State, collecting
inspection charges, fees, and licenses imposed upon beer or
other malt liquors shipped into the State of Missouri held
for sale or consumption within the State, or for shipment to
other States. (April, 1905. Pabst Brewing Co. v. Cren-
shaw, 198 U. S. 17.)
§ 5. Interstate Commerce-State Law Cannot Compel
Furnishing Cars for.-A State has no authority under its
police power, to require a common carrier, engaged in inter-
state commerce, to furnish a specified number of cars at a
specified time to be used by the shipper in interstate com-
merce, and a statute passed by the State Legislature con-
ferring such power is a burden upon interstate commerce,
and void as to cars to be used in interstate shipments.
(Houston & Texas Central Ry. Co. v. Mayes, 201 U. S. 321.)
A
A Texas statute (Rev. Stat., §§ 4497–5000), authorized a
shipper to make a requisition in writing for a number of
cars to be furnished at any point indicated, within a certain
number of days, upon the shipper making a deposit of one-
fourth of the freight, with the agent of the company.
penalty was imposed upon the carrier for failure to comply
with the requisition, subjecting it to forfeit $25 per day for
each car which it failed to furnish. The statute further de-
clared that its provisions should not apply "in cases of
strikes or other public calamities." In a suit to recover the
penalty the carrier interposed the defense that the cars re-
ferred to in the complaint were intended to be used for ship-
ments from the State of Texas to the State of Oklahoma,
and contended that the statute did not apply because the
State of Texas had no authority to regulate interstate com-
merce, and that such authority could not be sustained upon
the theory that it was an exercise of the police power of the
State. Plaintiff had judgment in the State court, which was
affirmed, and a writ of error to the Supreme Court of the
State of Texas was denied. Upon a writ of error to the
Supreme Court of the United States, the judgment was re-
versed upon the ground that in so far as the Texas statute
TAXATION
IMMUNITY.
45
sought to regulate the furnishing of cars used in interstate
commerce, it was unconstitutional and void. (Houston &
Texas Central Ry. Co. v. Mayes, 201 U. S. 321.)
(6
§ 6. Interstate Commerce-Taxation - Business Within
the State. A statute of Georgia (act passed December 21,
1900), provided that there should be assessed and collected
upon all agents of packing-houses doing business in the
State, $200 in each county where said business is carried
on." The validity of the act was attacked upon the ground
that it was a tax on interstate commerce. The court sus-
tained the statute upon the ground that, so far as it applied
to meats sold in Chicago and shipped to the petitioner in
Georgia for distribution, it could not be sustained; but that
so far as the petitioner was engaged in the business of selling
directly to customers in Atlanta, he was engaged in carrying
on an independent business as a wholesale dealer and was
liable to the tax. Judgment of the Supreme Court of Georgia
affirmed. (Kehrer v. Stewart, 197 U. S. 60.)
The Supreme Court of Georgia having held that the tax on
agents of packing-houses as to meats shipped from one State
into another for distribution was void as being a tax on inter-
state commerce, but that in so far as the statute applied only
to domestic business the statute was applicable, such a con-
struction would be accepted by the Supreme Court of the
United States in support of the tax, in so far as it relates to
domestic business only. (Kehrer v. Stewart, 197 U. S. 60.)
II. CONSTITUTIONAL LIMITATIONS - IMMUNITY.
§ 7. Immunity Defined Immunity Statute. The im-
8
munity guaranteed by the Fifth Amendment, which declares
that "no person shall be compelled in any criminal case to
be a witness against himself" is a personal privilege ex-
tended to the individual when called upon to testify. The
witness can claim the privilege for himself only when he has
been subpoenaed, thus making his attendance and evidence
compulsory. He cannot invoke the privilege to protect or
shield parties other than the witness. If he is an officer or
46
COMMENT AND AUTHORITIES.
agent of a corporation, he will not be allowed to claim that
his testimony might incriminate the body corporate, because
immunity under the Constitution extends only to a natural
person, and not to a corporation. As between the witness
and the corporation also, the latter is a third person, within
the meaning of the immunity provision. The witness cannot
invoke his personal privilege to protect any person other than
himself, not even a corporation of which the witness is the
agent. The immunity clause has been thus construed by the
Supreme Court of the United States, in what is known as
the Tobacco Trust cases. (Hale v. Henkel, 201 U. S. 43;
McAlister v. Henkel, 201 U. S. 61.)
The notion that immunity flows from the Constitution
like a perpetual fountain, whose benign influence, like a
benediction, is "broad and general as the casing air,” con-
ferring pardon upon all who may be indicted for crime, re-
lieving them from liability, and rendering the indictment
null and void, cannot obtain, in view of the ruling of the Su-
preme Court, defining the true intent and meaning of this
wise and merciful provision of the Constitution.
Congress deemed it expedient to embody this rule of evi-
dence, respecting immunity, in a statute. An act defining
the limitations of the constitutional provision relating to the
subject was approved June 28, 1906.* The statute provides
as follows:
Immunity Defined. That under the immunity provisions in the
act entitled “An act in relation to testimony before the Interstate
Commerce Commission," and so forth, approved February 11, 1893,
in section 6 of the act entitled "An act to establish the Department
of Commerce and Labor," approved February 14, 1903, and in the
act entitled "An act to further regulate commerce with foreign
nations and among the States,” approved February 19, 1903, and in
* The act is entitled as follows: "A bill to declare the true intent
and meaning of parts of the acts entitled 'An act in relation to testi-
mony before the Interstate Commerce Commission,' and so forth, ap-
proved February 11, 1893, and an act entitled 'An act to establish the
Department of Commerce and Labor,' approved February 14, 1903, and
an act entitled 'An act to further regulate commerce with foreign
nations and among the States,' approved February 19, 1903, and an
act entitled 'An act making appropriations for the legislative, exec-
utive, and judicial expenses of the Government for the fiscal year end-
ing June 30, 1904, and for other purposes,' approved February 25, 1903.
IMMUNITY
FEDERAL STATUTE.
47
the act entitled "An act making appropriations for the legislative,
executive, and judicial expenses of the Government for the fiscal
year ending June 30, 1904, and for other purposes,” approved Feb-
ruary 25, 1903, immunity shall extend only to a natural person who,
in obedience to a subpoena, gives testimony under oath or produces
evidence, documentary or otherwise, under oath. Act approved
June 28, 1906.
§ 8. Immunity Under Federal Statute-Act of Febru-
ary 25, 1903, Construed.-Congress passed an act, approved
February 25, 1903, entitled "An act making appropriations
for the legislative, executive, and judicial expenses of the
Government for the fiscal year ending June 30, 1904, and
for other purposes." (Laws 1903, chap. 755, 32 Stat. 854,
904.) This act contained a provision "that no person shall
be prosecuted or be subjected to any penalty or forfeiture
for or on account of any transaction, matter, or thing con-
cerning which he may testify or produce evidence, docu-
mentary or otherwise, in any proceeding, suit, or prosecu-
tion under said acts," of which the Sherman Anti-Trust Law
is one, providing, however, that "no person so testifying
shall be exempt from prosecution or punishment for perjury
committed in so testifying." Similar provisions are con-
tained in section 3 of the Elkins Act, approved February
19, 1903; and in section 6 of the Commerce and Labor Act,
approved February 14, 1903. The immunity granted, how-
ever extends only to prosecutions and proceedings arising
under Federal statutes, and can have no application to im-
munity under a State statute. It was held that under this
act a witness was not excused from testifying before a Fed-
eral grand jury because the immunity under the Federal
statute did not extend to prosecutions in the State court.
(Hale v. Henkel, 201 U. S. 43.)
The converse of this proposition was held by the Supreme
Court of the United States, in construing a State Anti-Trust
Law of Kansas, in which the court held that a witness could
not refuse to testify before State authorities acting under a
State Anti-Trust Law, because the immunity granted by the
State statute did not extend to prosecutions under a Federal
statute. (Jack v. Kansas, 199 U. S. 372.)
48
COMMENT AND AUTHORITIES.
§ 9. Immunity Under State Statute - Constitutionality
Sustained.-Authority to determine what crimes are punish-
able, and to provide for their punishment, is part of the
police power of a sovereign State. This power was not con-
ferred by the Constitution of the United States upon the
Federal government, and remains in the State. The Four-
teenth Amendment to the United States Constitution does
not create, narrow, or widen the police power, but leaves it
as it was before the amendment was adopted. No immunity
in a State statute can be broad enough to include immunity
from Federal prosecution, but the absence of such im-
munity does not necessarily invalidate the State law. (Jack
v. Kansas, 199 U. S. 372.)
The decision in Jack case arose in a proceeding commenced
under the Kansas Anti-Trust Law (Laws 1897, chap. 265).
The plaintiff in error was subpoenaed to appear before the
district judge of Shawnee county, Kansas, to be examined
under the State Anti-Trust Law with regard to the existence
of a monopoly or combinations of persons engaged in the
operation of coal mines in Osage county, to fix the price of
coal to be sold to residents and citizens of Kansas. Questions
were put to the witness, who refused to answer upon the
ground that the answers tended to incriminate the witness,
and that as the immunity provisions of the Kansas statute
were not broad enough to secure immunity from prosecution
under the Federal Anti-Trust Laws, the witness was not
bound to answer. The objections were overruled and the
witness directed to answer, which he refused to do. The
court then made an order committing the witness to the jail
of Shawnee county for contempt until he should answer the
questions; imprisonment not to exceed thirty days. The order
was affirmed by the Supreme Court of Kansas, and upon a
writ of error taken to the Supreme Court of the United
States, the order was affirmed. The plaintiff in error con-
tended that as the immunity granted by the State statute
did not furnish immunity from prosecution under the Fed-
eral Anti-Trust Laws, the order directing him to answer, and
ordering his imprisonment for failure to do so, deprived him
of his liberty without due process of law within the meaning
IMMUNITY
EXAMINATION BEFORE GRAND JURY. 49
of the Fourteenth Amendment. He claimed further that
the Kansas statute was void on that ground. The Supreme
Court held that the contention was without merit. The court
observed that while it was true that the law of Congress was
supreme, and that judges and courts in every State were
bound thereby, and that a Federal statute granting im-
munity would properly operate in the State as well as in the
Federal courts, and while there might be a bare possibility
that a witness might be subjected to the criminal laws of
some other sovereignty, yet it was not a real and probable
danger, but so improbable that it need not be considered.
The legal immunity secured by the Kansas statute operated
in regard to a prosecution in the same jurisdiction, and was,
therefore, sufficient. (Jack v. Kansas, 199 U. S. 372.)
(6
§ 10. Immunity-Examination Before Grand Jury.-
The examination of a witness before a Federal grand jury
is a
proceeding" within the act of February 25, 1903.
The court held that the word "proceeding" is not technical,
and is aptly used by courts to designate an inquiry before a
grand jury. It has received this interpretation in a number
of cases.
The case in which this decision was rendered,
known as "the Tobacco Trust case," arose in a proceeding
instituted under a subpoena duces tecum commanding Hale,
the plaintiff in error, to appear before the grand jury at a
time and place named, to testify and give evidence in a cer-
tain action pending in the Circuit Court of the United
States for the southern district of New York, between the
United States of America and the American Tobacco Com-
pany, and the MacAndrews & Forbes Company, on the part
of the United States, and to bring and produce certain
papers, books, and documents referred to in the subpoena.
The witness declined to answer on three grounds: First,
because it was physically impossible for the witness to get
together the books and documents within the time speci-
fied in the subpoena; second, because he was under no le-
gal obligation to produce anything called for by the sub-
pœna, and third, because the answer might tend to incrim-
inate him. The grand jury reported the matter to the court
50
COMMENT AND AUTHORITIES.
and made a presentment that the witness was in contempt.
The parties appeared before the circuit judge, who directed
the witness to answer the questions and produce the papers.
The witness persisted in his refusal, and the judge held him
in contempt and committed him to the custody of the mar-
shal, until he should answer the questions and produce the
papers. The witness sued out a writ of habeas corpus which
was dismissed and the prisoner remanded. An appeal was
taken to the Supreme Court of the United States where
the order of the court below was affirmed. It was urged on
appeal, that the witness was subpoenaed before the grand
jury, which was conducting an ex parte investigation, and
although the language of the subpoena required the witness
to testify and give evidence in a certain action now pending,
that as a matter of fact no action was pending. It was con-
tended, therefore, that there can be no prosecution in a crim-
inal proceeding until after a formal indictment had been
made showing that a criminal offense had been committed.
That an investigation by a grand jury is not a "case" or
controversy" within the meaning of the Constitution, and
that the investigation conducted by the grand jury was not
a proceeding, suit, or prosecution" under the act of Feb-
ruary 25, 1903. That the act referred to was unconsti-
tutional because it deprived the States of their right to
prosecute persons concerned in transactions in violation
of State laws. That the subpoena duces tecum was void
under the Fourth Amendment, as an unlawful search and
seizure of papers, and that the order deprived the witness
of his liberty without due process of law. These objec-
tions were held untenable, and the dismissal of the writ
of habeas corpus was affirmed. (Hale v. Henkel, 201
U. S. 43.)
66
(
§ 11. Immunity - Testimony Before
Before Grand Jury.-
Originally the grand jury seems to have been devised as
a convenient method to assist itinerant justices in England
to detect and punish crime, and a specific charge against
a particular person is not necessary to give the grand jury
jurisdiction. It acts on the information of the district at-
TESTIMONY BEFORE GRAND JURY.
51
torney, or upon its own knowledge or information other-
wise obtained. The scope of the powers of a grand jury
is limited by the jurisdiction of the court of which it is
an appendage. Under the ancient system in England,
criminal prosecutions were instituted at the suit of private
prosecutors, to which the King lent his name in the inter-
est of public peace. The usual practice was to prepare the
proposed indictment, and lay it before the grand jury for
their consideration, because that body was supposed to stand
between the prosecutor and the accused, and to determine
whether the charge was founded upon creditable testi-
mony or was dictated by malice. There is no authority,
however, for the proposition that a grand jury cannot pro-
ceed without the formality of a written charge. Their oath
requires them to make diligent inquiry as to things given
into their charge, and also all other matters and things which
shall come to their knowledge. If the grand jury, of their
own knowledge, or of the knowledge of witnesses examined
before them, know of the commission of an offense for
which no indictment is preferred, they must inform the
public prosecutor and request an indictment, or give in-
formation to the court respecting the offense. This latter
proceeding is called a presentment. In this country, the
examination of witnesses before a grand jury need not be
preceded by a presentment or indictment. Inquiry insti-
tuted by a grand jury is a proper and legal proceeding,
therefore, whether an indictment has been framed or not,
within the meaning of the act of February 25, 1903, and
the witness before it was properly directed to answer the
inquiry put to him. (Hale v. Henkel, 201 U. S. 43; Mc-
Alister v. Henkel, 201 U. S. 90.)
The fact that the statute was inoperative in that it did
not extend immunity to the corporation of which the wit-
ness was the agent or representative was, wholly untenable
for the reason that the immunity extended by the Fifth
Amendment was personal to the witness. It is a privilege
which the witness alone can invoke, and it is wholly im-
material that some third person might be incriminated as
52
COMMENT AND AUTHORITIES.
the result of the testimony given by the witness even al-
though the witness might be the agent of such third per-
son. In other words, a witness to whom immunity is ex-
tended by the statute will be compelled to testify and can-
not plead that some other person, even the principal for
whom the witness acts, might be subject to criminal prose-
cution. The amendment is limited to a person who shall
be compelled to be a witness against himself. If, there-
fore, the witness cannot set up the privilege of a third
person, he cannot set up the privilege of a corporation of
which he may be an officer. (Hale v. Henkel, 201 U. S.
43; McAlister v. Henkel, 201 U. S. 90.)
:
§ 12, Immunity Does Not Extend to Corporation.-
The question whether a corporation is a "person" within
the meaning of the Fifth Amendment to the Constitution
which excuses a person in any criminal case from being
a witness against himself is material only in a case where
a corporation is called upon to answer a bill of discovery.
The inquiry is not pertinent, when the privilege is claimed
by a witness who is an officer or agent of the corporation.
The corporation itself can only be heard by oral evidence
in the person of some one of its agents or employees. A
body corporate is an artificial inanimate entity. The cor-
poration, as such, cannot be called as a witness. In this
connection the court observed: "As the combination or con-
spiracies provided against by the Sherman Anti-Trust Act
can ordinarily be proved only by the testimony of parties
thereto, in the person of their agents or employees, the
privilege claimed would practically nullify the whole act
of Congress. Of what use would it be for the Legislature
to declare these combinations unlawful if the judicial power
may close the door of access to every available source of
information on the subject? Indeed, so strict is the rule
that the privilege is a personal one, that it has been held
in some cases that counsel will not be allowed to make
the objection." (Hale v. Henkel, 201 U. S. 43; McAlister
v. Henkel, 201 U. S. 90.)
IMMUNITY SEARCH AND SEIZURE.
53
§ 13. Immunity from Search and Seizure Extends to
Corporation.-A corporation cannot be examined as a wit-
ness. It cannot, therefore, claim immunity under the Fifth
Amendment of the Constitution for the reason that it can-
not testify against itself. Nevertheless, a corporation is
entitled to immunity under the Fourth Amendment against
unreasonable searches and seizures. Its property cannot be
taken without compensation; it can only be proceeded
against by due process of law, and is protected under the
Fourteenth Amendment against unlawful discriminations.
(Gulf, etc., R. R. Co. v. Ellis, 165 U. S. 150.) Corpora-
tions are an important feature of modern business activ-
ity, and their aggregate capital has become the source of
nearly all great enterprises. An order for the production
of books and papers may, therefore, constitute a reason-
able or unreasonable search and seizure within provisions
of the Fourth Amendment. But a corporation has no right
to refuse to submit its books and papers for an examina-
tion at the suit of the State. An individual stands upon a
different plane, in this regard, than a corporation. "The
power of the individual to contract," says Justice BROWN,
"is unlimited. He owes no duty to the State or to his
neighbors to divulge his business, or to open his doors to
an investigation so far as it may tend to incriminate him.
He owes no such duty to the State, since he received nothing
therefrom beyond the protection of his life and property.
He owes nothing to the public so long as he does not tres-
pass upon their rights.
<<
The corporation, however, is a creature of the State.
It is presumed to be incorporated for the benefit of the
public. It received certain special privileges and fran-
chises, and holds them subject to the laws of the State
and the limitations of its charter. Its powers are limited
by law.
It can make no contract not authorized by its
· charter. Its rights to act as a corporation are only pre-
served to it, so long as it obeys the laws of its creation.
There is a reserved right in the Legislature to investigate
its contracts and to find out whether it has exceeded its
powers. It should be a strange anomaly to hold that a State,
54
COMMENT AND AUTHORITIES.
having chartered a corporation to make use of said fran-
chises, could not, in the exercise of its sovereignty, inquire
how these franchises had been employed and whether they
had been abused, and demand production of the corporate
books and papers for that purpose. The fact that the cor-
poration receives its franchise from a sovereign State is
not material, because such franchise, when exercised in con-
nection with interstate commerce, must be exercised in sub-
ordination to the power of Congress to regulate such com-
merce. The corporation is subject to a dual sovereignty,
and the Federal government possesses the same right to
see that Federal laws are respected, as the State has with
respect to the special franchise which it has conferred. The
powers of the general government in vindicating its own
laws, are the same as if the corporation had been incor-
porated by an act of Congress.
"It follows, therefore, that the examination of the books
and papers of a corporation, if duly authorized by act of
Congress, would not constitute an unreasonable search and
seizure within the Fourth Amendment. The objection,
however, of a witness to the validity of a subpœna duces
tecum as being too broad as far as the corporation is con-
cerned does not excuse the witness from answering ques-
tions put to him, and has no bearing upon the validity
of an order committing him for contempt for refusal to do
so." (Hale v. Henkel, 201 U. S. 43; McAlister v. Heni-
kel, 201 U. S. 90.)
III. COMMERCE ACT
BATES
ELKINS' ACT POOLING RE-
DISCRIMINATION.
§ 14. Unreasonable Rates-Charges Based on Ship-
pers' Profits. Where industries have been established to
manufacture, sell, and ship certain commodities, to-wit, lum-
ber, and the success attending the enterprise has greatly
increased the profits resulting from the business, a carrier
transporting the property has no legal right to increase
the costs of carriage of the lumber in proportion to the
prosperity and increased profits resulting from the suc-
POOLING WHAT CONSTITUTES.
55
cess of the enterprise. The carrier cannot arbitrarily draw
to itself a portion of the profits of the manufacturer and
producer whose commodities it transports, by arbitrarily
increasing the charges of transportation in proportion to
the profits earned by the enterprise of the shipper. Such
arbitrary increase is unlawful, and will be restrained by
injunction. (Tift et al. v. Southern R. R. Co., 138 Fed.
Rep. 753. June, 1905, Cir. Ct., W. D. Georgia, S. D.)
§ 15. Pooling - What Constitutes.-A number of rail-
roads combined and formed what is known as the South-
eastern Freight Association. By concert of agreement, rates
were advanced upon shipments of a particular class through-
out the territory influenced by the association. Such a com-
bination, when it actually advances rates and exacts the
same of the shippers, will not be excused, nor will partici-
pants be relieved from the consequences of its acts, upon
the ground that the members of the association have signed
a stipulation, that each and all members can, at will, and
at any time, withdraw from the agreement. The combina-
tion, when its object is to unreasonably advance rates, vio-
lates the provisions of the Interstate Commerce Act, which
forbids pooling. The prohibition as to pooling was intended
to destroy monopolies and secure competition. "Pooling,"
says SPEER, J., "may be as well effected by a concert in
fixing in advance the rates, which in the aggregate would
accumulate the earnings of naturally competing lines, as by
depositing all such earnings to a common account and dis-
tributing them afterward. That such an association and
concert of action between agents of naturally competing lines
is destructive of competition is equally unanswerable. To
entertain any other view is to ignore reiterated decisions
of the Supreme Court of the United States and many rulings
of the Circuit Courts and of the State courts." (Tift et al.
v. Southern R. R. Co., 138 Fed. Rep. 753. June, 1905,
Cir. Ct., W. D. Georgia, S. D.)
""
§ 16. Pooling-When Joint Through Rate Is Not.-
A joint through rate, made by carriers having terminals on
56
COMMENT AND AUTHORITIES.
the Pacific coast to transport oranges, lemons, and other citrus
fruits to the Atlantic seaboard, the through rate being guar-
anteed by the initial carrier, on condition that the carrier
and not the shipper shall select the routes to the Atlantic
coast over the roads connecting with the eastern terminals
of the initial carrier, is not a violation of section 5 of
the Interstate Commerce Act, prohibiting pooling. (South-
ern Pacific Co. v. Interstate Com. Co., 200 U. S. 536;
Southern California Ry. Co. v. Interstate Com. Co., 200
U. S. 536; Atchison, Topeka & Santa Fé Ry. Co. v. Inter-
stale Com. Co., 200 U. S. 536; Santa Fé Pacific Ry. Co.
v. Interstate Com. Co., 200 U. S. 536.)
The case cited arose upon an application by the Inter-
state Commerce Commission to the United States Circuit
Court, southern district of California, to enforce an order of
the commission, directing the carriers to cease and desist
from enforcing their rule denying shippers of citrus fruits
to designate the routes beyond the terminals of the initial
carriers, for transportation of their property from California
to the eastern markets, on the ground that the rule was in
violation of various provisions of the Interstate Commerce
Act. The court below enjoined the enforcement of the rule
and the carriers appealed. The judgment appealed from
was reversed and the injunction dissolved.
Prior to the adoption of the rule, shippers were accustomed
to select the eastern route from the terminals of the initial
shippers to the seaboard, over which the fruit was shipped,
and in the enjoyment of this right the shippers, it was
charged, received rebates from the eastern carriers operat-
ing roads beyond the terminals of the initial carriers. One
shipper, the Southern California Fruit Exchange, admitted
that in four years it received rebates amounting to $174,000.
Among those participating in these rebates were the car-line
companies, owning cars in which the fruit was packed, de-
scribed as ventilating or refrigerating cars, which cars were
hired by the initial carriers. The car companies received
a bonus from eastern connecting roads, of from $10 to $40
a car, in consideration of the car being routed over the line,
paying the bonus, a part of which was usually turned over
POOLING
RULE AS TO ROUTING.
57
to the shipper by the car company for the privilege allowed
the latter of routing the shipment. The right of routing,
therefore, was extremely valuable to the shipper and to the
private carline companies. In order to break up the prac-
tice of rebating, which proved so valuable to the shipper,
the initial carriers established the following rules:
Rule as to Routing.— “In guaranteeing the through rate named
herein, the absolute and unqualified right of routing beyond its
own terminal is reserved to initial carriers giving the guarantee.
In accordance with this rule, agents will not accept shipping
orders or other documents, if roùting instructions are shown
thereon. Neither will agents accept verbal routing instructions."
"Initial carriers will route each car from point of origin to
point of destination and diversion in transit will not be permitted,
except by consent of initial carrier, who will thereupon designate
new routing when diversion necessitates change therein."
The initial carriers on the Pacific coast embraced two
systems known as the Southern Pacific and Santa Fé, whose
termini were at Chicago, Ogden, and New Orleans, from
which points the eastern shippers over various routes trans-
ported the fruit to all parts of the United States. After
the rules denying to the shipper the right to select his rout-
ing, neither the shipper nor the car lines could secure re-
bates from the eastern carriers, because they could no longer
designate the route over which the fruit should be shipped.
The initial carrier then made joint-tariff rates for trans-
portation of oranges, and citrus fruits from southern Cali-
fornia at $1.25 per hundred to practically all points east
of the Missouri river, which tariff agreements were filed
with the Interstate Commerce Commission. The initial car-
rier, however, did not assume liability for negligence of
any connecting line. After a full hearing, the commission
held that the agreement made by the initial carrier with
their eastern connections constituted pooling of the rates on
citrus fruit traffic, or the divided earnings therefrom, in
violation of section 5 of the Interstate Commerce Act pro-
hibiting pooling, and that the rule complained of subjected
the shipper to undue, unjust, and unreasonable proference
and disadvantage, and gave the carrier an undue and un-
58
COMMENT AND AUTHORITIES.
reasonable preference and advantage in violation of sec-
tion 5 of the Interstate Commerce Act.
The Supreme Court reversed the ruling of the Circuit
Court, which sustained the order of the Commission, and
dissolved the injunction upon the ground that under the
circumstances of the case, and in view of the fact that
citrus fruits were a particular kind of freight in regard to
which all other freight has substantially nothing in common,
and also in view of the fact that as all shippers were treated
alike by the initial carrier, it could not be said that any
unjust discrimination or preference resulted from the rule
under the circumstances; therefore the court held that the
agreements for joint through rates by the connecting carriers
were not pooling agreements within the prohibition of sec-
tion 5 of the Interstate Commerce Act. The court ob-
served that the evidence showed that the rules were adopted
by the initial carrier for the purpose of breaking up re-
bating, which had been accomplished, and the evidence
showed that the eastern roads entered into the routing agree-
ment because they were satisfied that it would be better than
the practice of rebating, which had previously obtained, and
that they would get a fair share of the business or, in other
words, would be fairly treated by the initial carrier, who
gave them to understand that they would be so treated and
that there was no evidence of the existence of a tonnage pool.
The court further said that the court below treated the
connecting carriers as rival and competing transportation
lines, and assumed that between these lines there would
exist, but for the routing agreement, a competition for the
fruit transportation, which competition was destroyed by
the rule. The Supreme Court, in answer to this contention,
said: "We think these various routes were really not com-
peting roads within the meaning of the fifth section of the
Commerce Act, when the facts are carefully examined.
X * * The initial carrier did not on its line reach the
eastern markets, but reached various connecting roads which
did reach those markets. The initial carrier had the right
to enter into an agreement for joint through rates, with all
or any of these connecting companies, though such companies
WHEN CARRIER MAY DESİGNATE ROUTE.
59
were competing ones among themselves." (Southern Pacific
v. Interstate Com. Co., 200 U. S. 536.)
§ 17. Discrimination - When Denial of Right of Shipper
to Designate Route Is Not.- Where the initial carrier gives
a guaranteed through rate on citrus fruits from California
to the Atlantic seaboard, it may make a rule reserving the
right to route the goods beyond their own terminals, and
such routing by the initial carrier which gives such carrier
the right to select over what lines it would transport the
goods beyond its own line, would not constitute an unjust
discrimination against the shipper, nor a pooling as pro-
hibited by section 5 of the Interstate Commerce Act. The
Supreme Court reversed Interstate Com. Co. v. Southern
Pacific Ry. Co., 123 Fed. Rep. 597, and dissolved the in-
junction granted by the Circuit Court, restraining the initial
carriers from designating the routes beyond the lines of such
carriers on the ground that the Commerce Act had not been
violated by the carrier. (Southern Pacific Ry. Co. v. In-
terstate Com. Co., 200 U. S. 536; Southern California
Ry. Co. v. Interstate Com. Co., 200 U. S. 536; Atchison,
Topeka & Santa Fé Ry. Co. v. Interstate Com. Co., 200
U. S. 536; Santa Fé Pacific Ry. Co. v. Interstate Com. Co.,
200 U. S. 536.)
Joint through rates are the subject of agreement between
the companies under their control, and there is nothing in
the Interstate Commerce Act to prevent an initial carrier
guaranteed a through rate, and to reserve in its public
notice thereof the right to route the goods beyond its own
terminal. A carrier cannot be compelled to make a through
rate if it does not see fit to do so beyond its own line. If,
however, the carrier and other connecting lines of road
make an agreement whereby an initial carrier may make
a joint through rate over its own line and over other con-
necting lines, the initial carrier may select the connecting
lines over which it will transport the goods and may reserve
this right when it guarantees a through rate. It cannot be
said that such a transaction is an unlawful designation within
the meaning of the Interstate Commerce Act, if the business
60
COMMENT AND AUTHORITIES.
and the character of the freight is of a special nature like
the fruit business, having nothing in common with other
freight.
The court observed that before the rule was promulgated
by the initial carrier forbidding the shipper to designate
the route beyond that of the initial carrier, it had been cus-
tomary for the shipper to select his own route, and to collect
rebates for the routing from the connecting carriers. The
carriers claimed that they were obliged to adopt the rule so
as to prevent the shipper from collecting unlawful rebates.
In the trial of the case, the court said that there was nothing
in the testimony taken before the Interstate Commerce Com-
mission to show that the practice of collecting rebates to
be paid to the shipper had been resumed after the rule had
been adopted forbidding him to select his route, and this
for the obvious reason that the shipper could not control the
route, and hence it would be useless for the eastern rail-
way companies to pay the shipper or the car-line com-
panies rebates on freight which said eastern company was
not receiving, and which the initial carrier alone had the
routing of. As soon as the routing was agreed upon and the
through tariff rates fixed, the eastern connections had to
do business with the initial carrier, instead of the car com-
pany owning the cars in which the fruit was packed or the
shipper. The shippers prepay or guarantee freight charges
to destination. The initial carrier does not assume liabil-
ity for damage resulting from negligence of any connecting
line. The Circuit Court based its ruling upon the theory
that the connecting carriers were rival and competing trans-
portation lines and assumed that between these lines there
did exist, but for the routing agreement, a competition for the
fruit transportation which could not be extinguished by any
agreement as to routing, as a condition for making through
tariff rates, and that as competition was destroyed by the
rule, it was idle to say that such result was not maintained
by the defendant, and the court concluded that the carry-
ing out of the routing agreement was a violation of the
Commerce Act. The Supreme Court, however, concluded
that the various eastern roads were not, as matter of law,
REBATES
DISCRIMINATION
FREIGHT CLASSIFICATION. 61
to be regarded as competing roads within the meaning of
section 5 of the Commerce Act, because the carriers had
a right under the act to agree upon and provide for the pub-
lication of joint through tariff rates between continuous
roads, provided such through rates were reasonable and no
discrimination was practiced. That the initial carrier had
the right to enter into an agreement for joint through rates
with all or any one of the connecting companies, though such
companies were competing among themselves, and such agree-
ment could be made upon such terms as the various com-
panies might think expedient, provided they were not in
violation of any other provision of the Commerce Act.
(Southern Pacific Ry. Co. v. Interstate Com. Co., 200 U. S.
536.)
For fuller report of this case see "pooling," ante, page 55.
§ 18. Rebates - Discrimination - Freight Classification
One method resorted to by the carrier to hide rebates,
and to discriminate against certain kinds of freight, is in
the manipulation of freight classification. Rates and charges
may be raised, and certain kinds of commodities discrim-
inated against, by taking certain goods from the classifi-
cation which entitle them to be carried for a certain amount,
and placing them in another classification which will require
the shipper to pay a higher rate of freight. An instance of
this kind will be found in what is known as the Hay case
(134 Fed. Rep. 142). Hay and straw in carloads were
classed by the carrier in what was known as sixth-class
freight. Commodities in this class are carried cheaper than
commodities rated in the fifth class. In order to raise the
freight on hay and straw, the carrier, on the 1st of Janu-
ary, 1900, took hay and straw out of sixth-class freight and
classified it as fifth class, thus compelling the shipper to
pay the higher rate.
Upon complaint of the shipper, testimony was taken before
the Interstate Commerce Commission, which resulted in an
order made by the commission, directing the carriers to cease
and desist from charging fifth-class rates on hay and straw,
62
COMMENT AND AUTHORITIES.
based upon findings that such rates were unreasonable. The
commission also found that the whole advance was unreason-
able, and that the advance and consequent placing of hay
and straw in the fifth class unjustly discriminated against
that commodity in favor of other articles furnishing less
total tonnage to the carriers. The order of the commission
further directed the carrier to cease and desist from failing
or neglecting to apply sixth-class rates to shipments of hay
and straw. The carrier failed to comply with the order, and
the commission brought suit in the Circuit Court of the
United States, northern district of Ohio, to secure the en-
forcement of its order. The court dismissed the petition
upon the ground that the direction of the commission as to
how freights should be classified was, in effect, exercising
the power to fix rates, and that since the Commerce Act did
not give the commission such power, its order was unlawful.
(Interstate Com. Co. v. Lake Shore & Michigan R. R.
Co., 134 Fed. Rep. 140.)
On and after August 28, 1906, the objection that the
Interstate Commerce Commission has no power to fix rates
will have no application, as section 15 of the act as amended
expressly confers such power.
§ 19. Discrimination - Transportation of Troops.- A
difference in rates does not necessarily constitute an unjust
discrimination. The government, in the transportation of
troops in squads of ten or more, does not financially, or in
any other way, come into competition with the reduced ten-
party rate given to "theatrical, operatic, or concert com-
panies, hunting and fishing parties, glee clubs, brass or string
bands, boat, bascball, or tennis clubs, football teams, and
other parties of like character, which is authorized by sec-
tion 22 of the Commerce Act, providing for excursion rates,
commutation rates, and the like. The government claimed
the benefit of the "ten-party-rate schedule" in transporting
its troops in squads of ten or more. Held, that the govern-
ment was not entitled to claim the reduced rate. (United
States v. Chicago & Northwestern R. R. Co., 127 Fed. Rep.
785.)
CARRIER CANNOT BE DEALER.
63
See also, same ruling as to railroad running partly over
tracks of railroad which received land grants from govern-
ment under act of July 2, 1864. (United States v. Astoria
& Columbia River R. R. Co., 131 Fed. Rep. 1006.)
IV. COMMERCE ACT-CARRIER CANNOT BE A DEALER.
§ 20. Carriers Cannot Deal in Commodities which They
Transport.— The Supreme Court of the United States in a
decision rendered on the 19th of February, 1905, in what
is known as the Chesapeake & Ohio Case, announced the
doctrine that dealing in coal by a railway company was il-
legal, because incompatible with its duties as a public car-
rier, and calculated to inflict an injury upon the public.
That any contract or arrangement entered into by a common
carrier or permitting such carrier to engage in business as a
dealer in the commodities which it transported was contrary
to public policy and void. The court observed that "if a
carrier may become a dealer, buy property for transporta-
tion to a market and eliminate the cost of transportation to
such market, a faculty possessed by no other owner of the
commodity, it must result that the carrier would be in a
position where no other person could ship the commodity
on equal terms with the carrier, in its capacity as dealer.
No other person owning the commodity, being thus able to
ship on equal terms, it would result that the owners of such
commodity would not be able to ship, but would be compelled
to sell to the carrier." (New Haven R. R. Co. v. Inter-
state Com. Co., 200 U. S. 361; Interstate Com. Co. v.
Chesapeake & Ohio R. R. Co., 200 U. S. 361.)
The court, in support of the proposition, that to allow a
carrier to deal in property which it transported was con-
trary to public policy, cited an authority by Vice-Chancellor
Kindersley (Attorney-General v. Great Northern Ry. Co.,
29 Law Jour. N. S. Equity, 794), in which the English
chancellor held that dealing in coal by a railway company
was illegal, because incompatible with the duties of the
railway as a public carrier and calculated to inflict an
64
COMMENT AND AUTHORITIES.
* *
injury upon the public. The vice-chancellor held that the
act of Parliament granting the charter to operate the rail-
way, implied a prohibition against the companies engaging
in any other business. The reason for the rule was thus
expressed by the vice-chancellor: "These large companies,
joint-stock companies generally, for whatever purpose es-
tablished and more particularly railway companies, are
armed with powers of raising and possessing large sums
of money-large amounts of property-and if they were
to apply that money, or that property, to purposes other
than those for which they were constituted, they might very
much injure the interests of the public in various ways.
They might get into their hands the traffic, that
is, the dealing in all the coal in the large districts supply-
ing coal to the country. If they can do that with regard
to coal, what is to prevent their doing it with every species
of agricultural product all along the line? Why should they
not become purchasers of corn, of all kinds of beasts and
of sheep, and every species of agricultural produce, and
become great dealers in the supply of edibles to the markets
of London; and why not every other species of commodity
that is produced in every part of the country from which, or
to which, the railway runs? I do not know where it is to
stop if the argument on the part of the company is to pre-
vail. There is, therefore, great detriment to the interests
of the public, for this reason, taking merely the article of
coal."
The court, by Mr. Justice WHITE, commenting upon the
remedial character of the Interstate Commerce Act, and
in support of the proposition that a carrier could not as-
sume the duties of a dealer, remarked: "It cannot be chal-
lenged that the great purpose of the act to regulate com-
merce, whilst seeking to prevent unjust and unreasonable
rates, was to secure equality of rates as to all and to destroy
favoritism, these last being accomplished by requiring the
publication of tariffs, and by prohibiting secret departures
from such tariffs, and forbidding rebates, preferences,
and all other forms of undue discrimination. To this ex-
tent, and for these purposes, the statute was remedial, and
CARRIER CANNOT BE DEALER.
65
is, therefore, entitled to receive that interpretation which
reasonably accomplishes the great public purpose which it
was enacted to subserve. That a carrier engaged in inter-
state commerce becomes subject as to such commerce to the
commands of the statute, and may not set its provisions at
naught whatever otherwise may be its power when carry-
ing on commerce not interstate in character, cannot in rea-
son be denied. Now, in view of the positive command of
the second section of the act, that no departure from the
published rate shall be made, 'directly or indirectly,' how
can it in reason be held that a carrier may take itself from
out the statute in every case by simply electing to be a
dealer and transport a commodity in that character? For,
of course, if a carrier has a right to disregard the published
rates by resorting to a particular form of dealing, it must
follow that there is no obligation on the part of a carrier
to adhere to the rates, because doing so is merely voluntary.
The all-embracing prohibition against either directly or in-
directly charging less than the published rates shows that
the purpose of the statute was to make the prohibition ap-
plicable to every method of dealing by a carrier by which
the forbidden result could be brought about. If the public
purpose which the statute was intended to accomplish be
borne in mind, its meaning becomes, if possible, clearer.
What was that purpose? It was to compel the carrier as a
public agent to give equal treatment to all. Now, if by the
mere fact of purchasing and selling merchandise to be trans-
ported a carrier is endowed with the power of disregarding
the published rate, it becomes apparent that the carrier pos-
sesses the right to treat the owners of like commodities by
entirely different rules. That is to say, the existence of such
a power in its essence would enable a carrier, if it chose to
do so, to select the favored persons from whom he would buy
and the favored persons to whom he would sell, thus giving
such persons an advantage over every other, and leading to
a monopolization in the hands of such persons of all the
products as to which the carrier chose to deal. Indeed, the
inevitable result of the possession of such a right by a car-
rier would be to enable it, if it chose to exercise the power,
66
COMMENT AND AUTHORITIES.
to concentrate in its own hands the products which were held
for shipment along its line, and to make it, therefore, the
sole purchaser thereof and the sole seller at the place where
the products were to be marketed; in other words, to create
an absolute monopoly." (New Haven R. R. Co. v. Inter-
state Com. Co., 200 U. S. 361; Interstate Com. Co. v. Ches-
apeake & Ohio R. R. Co., 200 U. S. 361.)
The cases cited arose in a suit instituted in the United
States Circuit Court of the district of West Virginia, by
the Interstate Commerce Commission, to enjoin the carrying
out of a contract under which the Chesapeake & Ohio Rail-
way Company, a Virginia corporation, agreed to deliver at
New Haven 60,000 tons of New River coal for the New
York, New Haven & Hartford Railroad Company, a Con-
necticut corporation, at $2.75 per ton. The price of coal
at the mines, plus the cost of transportation from Newport
News to New Haven, was $2.47 per ton, while the published
rate from the mine to Newport News was $1.45 per ton, and
the bill was based on the claim that this was in effect a dis-
crimination, in that the company carried the coal for less
than the published rates. In 1895 the State of West Vir-
ginia passed an act entitled "an act to prevent railroad com-
panies from buying or selling coal or coke, and to prevent
discrimination." To evade this statute, the place of de-
livery under the contract was to be at New Haven, Conn.
The company denied this, and alleged that it had sus-
tained a loss on the price of the coal, and that it took this
means to reimburse the New Haven road for some $100,000
which it had lost through the inability to fill a previous con-
tract owing to a strike of miners.
The Circuit Court held that there was no violation of
the rebate provision of the Interstate Commerce Act, but
held that the contract between the two roads was illegal,
contrary to public policy, and void, and enjoined its enforce-
ment. The two roads and the commission appealed.
The Supreme Court discussed the contract in question
and also a previous contract, which was for 2,000,000 tons,
with deliveries guaranteed by J. Pierpont Morgan. The
various phases of both contracts are considered at length,
CARRIER CANNOT BE DEALER.
67
and the conclusion reached that they were void as against
public policy, and also in violation of the Interstate Com-
merce Act, because the margin for freight rates was lower
than the published rates.
The court modified the injunction granted by the Circuit
Court by enlarging its provisions. In this regard Mr. Jus-
tice WHITE said: "As the court below did not decide that
the second and third sections of the act relating to the main-
tenance of rates had been violated, the injunction issued by
it was not made as directly responsive to the commands of
the statute on that subject as we think it should have been.
We, therefore, conclude that the injunction below should be
modified and enlarged by perpetually enjoining the Chesa-
peake and Ohio from taking less than the rates fixed in its
public tariff or freight rates by means of dealing in the pur-
chase and sale of coal." As thus modified the decree below
was affirmed. (New Haven R. R. Co. v. Interstate Com.
Co., 200 U. S. 361; Interstate Com. Co. v. Chesapeake &
Ohio R. R. Co., 200 U. S. 361.)
In declaring that the contract of the carrier, made by it
as a dealer was contrary to public policy and void, the court
said: "It is said that when a carrier sells an article which
it has purchased and transports that article for delivery, it is
both a dealer and a carrier. When, therefore, the price re-
ceived for the commodity is adequate to pay the published
freight rate and something over, the command of the stat-
ute as to adherence to the published rates is complied with,
because the price will be imputed to the freight rate, and
the loss, if any, attributed to the company in its capacity as
dealer and not as a carrier. This simply asserts the propo-
sition which we have disposed of, that a carrier possesses the
power by the form in which he deals, to render the prohibi-
tions of the act ineffective, since it implies the right of a
carrier to shut off inquiry as to the real result of a particu-
lar transaction on the published rates, and thereby to ob-
tain the power of disregarding the prohibitions of the statute.
'It is said, that as in the case in hand, it is shown that
there was no intention on the part of the carrier in making
68
COMMENT AND AUTHORITIES.
the sale of the coal to violate the prohibitions of the statute,
and, on the contrary, as the proof shows, an arrangement was
made by the carrier for transporting the coal from Newport
News to Connecticut, which, if it. had been carried out,
would have provided for the full published rate; therefore,
an honest contract made by the carrier should not be stricken
down because of things over which the carrier had no control.
"The proposition involves both an unfounded assumption
of fact and an unwarranted implication of law. It is true
the court below found that the proof did not justify the in-
ference that the Chesapeake and Ohio had, in 1896, made
the contract to sell the coal to the New Haven with the pur-
pose of avoiding a compliance with the published rates. But
in this conclusion of fact we cannot agree. While it may be
that the proof establishes that the contract for the sale of
coal was not made as a mere device for avoiding the opera-
tion of the statute, we think the proof leaves no doubt that,
in making the contract in question, the Chesapeake and Ohio
was wholly indifferent to and did not concern itself with
the prohibition of the statute, of which, of course, it must
be assumed to have had full knowledge." (New Haven R. R.
Co. v. Interstate Commerce Commission, 200 U. S. 361;
Interstate Commerce Commission v. Chesapeake & Ohio R.
R. Co., 200 U. S. 361.)
$21. Carrier Cannot be a Dealer - Legislation of 1906
as to. The wholesome doctrine that it is contrary to public
policy to permit a carrier to deal in the commodities which it
transports; that it cannot occupy the dual capacity of dealer
or shipper, and carrier, was declared by the Supreme Court
of the United States in February, 1906, in what is known as
the Chesapeake and Ohio case, supra. The notable opinion
of the court, written by Mr. Justice WHITE and concurred
in by all of his associates, is a forcible and convincing argu-
ment showing the wisdom of the rule. On June 29, 1906,
Congress enacted this rule of public policy into a law, and
it now forms part of section 1 of the Commerce Act. "From
and after May first, 1908," the statute declares, it shall be
unlawful for any railroad company to transport among the
IMPRISONMENT
CRIMES AND CONSPIRACIES.
69
States and Territories, or to any foreign country "any article
or commodity, other than timber or the manufactured prod-
ucts thereof, manufactured, mined, or produced by it, or
under its authority, or which it may own in whole or in part,
or in which it may have any interest, direct or indirect,
except such articles or commodities as may be necessary and
intended for its use in the conduct of its business as a
common carrier."
The value of this statutory prohibition is apparent, when
we consider that it would be impossible for a carrier to dis-
charge its duty, as such, to all shippers, affording to each
equality of opportunity, and placing all upon an equal
plane, when the carrier also becomes a shipper. It is ob-
vious that a carrier, which is also a shipper, becomes a rival
and competitor of every shipper to whom it owes a public
duty to carry. As a carrier, it cannot serve itself, and also
mete out impartial and exact justice to other shippers, and
faithfully discharge its obligations in that regard.
V. IMPRISONMENT - CRIMES AND CONSPIRACIES.
§ 22. Imprisonment - Conspiracy Against the United
States. Under section 10 of the Commerce Act, as origi-
nally passed, the sentence imposed for its violation, in-
cluded imprisonment in the penitentiary for a term not
exceeding two years" or a fine not exceeding $5,000, or
both, in the discretion of the court. On the 19th of Febru-
ary, 1903, the Elkins Act was passed, which contained a
provision abolishing the penalty of imprisonment contained
in section 10 of the Commerce Act, and substituted a fine,
not less than $1,000 nor more than $20,000. The result of
this legislation, as shown by the evidence secured by the
Bureau of Corporations in the Department of Commerce and
Labor, and by the Commissioner of Corporations under the
act approved February 14, 1903, as reported from time to
time to the Department of Justice, showed that the evils
resulting from rebating and preferences and discriminations.
against shippers and localities, which it was sought to
remedy by the Commerce Act and the Elkins Act, continued
to be practiced with impunity. The punishment imposed,
70
COMMENT AND AUTHORITIES.
being measured only by a fine, seems to have had no de-
terrent effect.
In view of these facts, the Attorney-General of the United
States came to the conclusion that the only way to enforce
violations of the Commerce Act and the Elkins Act was to
secure indictments, under which the defendants, upon con-
viction, could be sent to prison. Resort was had to section
5440 of the United States Revised Statutes, which makes it
a crime for two or more persons to conspire to commit any
offense against the United States. Conviction under this
section for conspiracy, prior to the amendment of 1897, au-
thorized the court to impose a penalty by fine, and also
imprisonment, for not more than two years. In construing
this section, the Supreme Court of the United States in
Clune v. United States, 159 U. S. 590, declared that if the
crime which defendants conspired to commit was punishable
only by fine, nevertheless, if the defendants were convicted
under the conspiracy clause of the Revised Statutes, they
were subject to the penalties imposed by that section, which
included imprisonment for not more than two years.
It was contended, by counsel for accused, in the Clune
case, that a conspiracy to commit an offense could not be
punished more severely than the offense itself, and that,
therefore, when the principal offense is in fact committed,
the mere conspiracy is merged in it.
(6
In answer to this contention, the court, BREWER, justice
said: The language of the section is plain, and not open
to doubt. A conspiracy to commit an offense is denounced
as itself a separate offense, and the punishment therefor is
fixed by the statute, and we know of no lack of power in
Congress to thus deal with a conspiracy. Whatever may be
thought of the wisdom or propriety of a statute making a
conspiracy to do an act punishable more severely than the
doing of the act itself, is a matter to be considered solely
by the legislative body." The court cited in support of its
opinion also Callan v. Wilson, 127 U. S. 540.
After this decision, the conspiracy section was amended
in 1897, by making the punishment of imprisonment in the
alternative, and fixing a maximum fine of not more than
CONSPIRACY AGAINST UNITED STATES.
71
$10,000, with no minimum specified, and giving the court
discretion to impose either or both penalties.
In view of these plain provisions of the conspiracy section
the Attorney-General gave instructions to district attorneys
throughout the country to investigate all complaints for vio-
lations of the Elkins Act and Commerce Act, and if reason-
able grounds therefor existed and sufficient evidence could
be obtained, to submit such evidence to the grand jury under
section 5440 of the United States Revised Statutes, charging
conspiracy to commit a crime against the United States.
The section of the Revised Statutes, as amended 1897, pro-
vides as follows:
Conspiracy Against the United States. If two or more persons
conspire either to commit any offense against the United States
or to defraud the United States in any or for any purpose, and
one or more of such parties do any act to effect the object of the
conspiracy, all the parties to such conspiracy shall be liable to a
penalty of not more than ten thousand dollars or to imprisonment
for not more than two years, or to both fine and imprisonment
in the discretion of the court. (U. S. Rev. Stat., § 5440.)
Indictments were found, under this section, in Kansas
City, eastern district of Missouri, against Thomas and Tag-
gart, for conspiring to commit the crime of rebating, which
is an offense against the United States, forbidden by the
Commerce Act and the Elkins Act, but made punishable,
under those acts, only by fine.
Similar indictments were found also by the grand jury
in the county of New York, southern district of New York,
against certain shippers and officers of the New York
Central railroad. The indictments in Kansas City were
tried in June, 1906, before Hon. SMITH MCPHERSON, and
were sustained and the defendants were convicted. Judge
McPherson followed Clune v. United States, 159 U. S. 590,
above cited, and held that a conspiracy to commit an offense
was a distinct crime from that sought to be committed.
Congress having made it a separate offense, with a different
penalty.
The New York indictments, under the conspiracy clause
of the United States Revised Statutes, were demurred to by
72
COMMENT AND AUTHORITIES.
defendants. The demurrers were argued June 29, 1906,
before Hon. GEORGE C. HOLT, district judge, shortly after
the Kansas City indictments were sustained by Judge Mc-
PHERSON. Judge HOLT, after careful consideration, felt con-
strained to differ from the ruling made by Judge McPHER-
SON, sustained the demurrers and dismissed the indictments.
"To claim that the agreement to give a rebate is a con-
spiracy punishable by imprisonment," said Judge HOLT,
"while the actual giving of it is an offense punishable only
by fine seems to me too subtle a distinction to be drawn in
the administration of the criminal law."
It would seem that the practical effect of Judge HOLT's
opinion, if sustained, would operate to nullify section 5440
of the United States Revised Statutes, because if an act is
made a crime, the accused must be indicted and tried for
committing it. If he conspires with another to commit it
he cannot be indicted for the conspiracy, but the District
Attorney must confine his indictment to the direct commis-
sion of the offense.
In this connection, it may be observed, that the imprison-
ment penalty, for violations of the Commerce Act and the
Elkins Act, was not restored by the Act of June 29, 1906,
except only as to the crime of rebating. In one sense, any
violation of these laws, whether it be by means of false bills,
false weights, false classification, failure to furnish cars, or
move traffic, might be held to be a mere cover or device to
accomplish the crime of rebating, which in its essence is the
act of the carrier in charging one shipper more than another
for the same service, or for substantially the same service.
But in the administration of the criminal law, it is extremely
doubtful if the crime of false billing, false weights, or false
classification, or discrimination in car service or in the use
of terminal facilities can be punished by imprisonment. All
these offenses were made punishable by imprisonment un-
der section 10 of the Commerce Act, prior to the passage of
the Elkins Act, February 19, 1906. Failure to obey a writ
of mandamus to furnish cars or move traffic was made, under
section 6 of the Commerce Act, punishable "as and for a
contempt," which is punishable by fine and imprisonment.
CRIMINAL LIABILITY.
73
These punishments were not directly restored by the Act of
June 29, 1906.
§ 23. Criminal Liability Rebates Concessions
Foreign Shipments.-The Elkins Act of February 19, 1903,
declares that it shall be unlawful for the carrier to receive
or collect from any person a greater or less compensation
than it charges or collects from any other person for a like
service and makes it a criminal offense for the carrier or
any person or corporation "to offer, grant, or give or to
solicit, accept, or receive any rebate." Criminal proceed-
ings were instituted on behalf of the Government against
Armour & Co., Swift & Co., The Cudahy Company, The
Nelson Morris Packing Company, and others for a violation
of the provisions of the Elkins Act relating to rebates. It
was charged that the defendants accepted a rate of twenty-
three cents per 100 pounds on shipments of lard consigned to
Germany by way of the Burlington railway, when the legal
tariff was thirty-five cents per 100. The case was tried in
June, 1906, in the United States District Court at Kansas
City, Mo., before Hon. SMITH MCPHERSON. The jury found
the defendants guilty. The contention of the defendants
was that the twenty-three-cent rate was legal because the
Burlington railroad raised its tariff to thirty-five cents per
100 after it had made its contracts with the defendants.
After the contract had been made with defendants at the
twenty-three-cent rate, which expired on the 31st day of
December, 1905, the railroad company, prior to the expira-
tion of the contract, on the 6th day of August, 1905, filed a
new schedule of tariffs fixing the rate of thirty-five cents per
100 pounds. The court held that defendants knowingly,
after the rate had been changed, continued to pay, and the
railroad company continued to accept, the twenty-three-cent
rate, while other shippers were obliged to pay thirty-five
cents for the same service. The court held that this was a
violation of the Elkins Act. The court charged the jury as
follows:
"According to the indictment returned against the defendant,
the packing company signed a contract to run until December 31,
74
COMMENT AND AUTHORITIES.
1905, in which the Burlington railway agreed, with other connect-
ing railways, to carry packing-house products from the Missouri
river to Germany, billed via New York; that the rate agreed upon
included a rate of twenty-three cents a hundred pounds between
the Mississippi river and New York; that while this contract was
in existence the Burlington railway filed with the Interstate Com-
merce Commission an amended tariff of thirty-five cents on these
products from the Mississippi river to New York; and that the
defendant continued to accept the twenty-three-cent rate after
August 6, 1905, when the alleged offense was committed.
"The Constitution of the United States gives Congress the
power to regulate commerce between the States and with foreign
nations. And in the exercise of this power Congress did enact
the two statutes of February 4, 1887, and of February 19, 1903,
the last being amendatory of the former.
"And the court charges you that in carrying the products from
Kansas City, Kan., in and through this division and district to
the Atlantic seaboard ports, to be loaded there on vessels and car-
ried to European ports, such commerce was with foreign nations
and was such commerce as is referred to and covered by the two
enactments of Congress mentioned. In this case the defendant
packing company was both the shipper and the consignee. And
in making such shipment from Kansas City, Kan., to, within,
through and beyond this division and judicial district to an At-
lantic seaboard port, to be there placed upon an ocean vessel to be
carried to a European port, both the defendant packing company,
the Burlington company and the connecting lines of railroad,
each and all are amenable to the two statutes in question. And
if the law has been violated in the facts in evidence under the
indictment herein, then this court has jurisdiction to hear and
determine the case and render such judgment as your verdict and
justice requires.
"And if such shipment of such packing-house products were
made from Kansas City, Kan., to the European ports as a through
shipment, consigned by the defendant packing company at Kansas
City, Kan., to itself at the European port, and this fact was so
known by the defendant when it made the shipment, and if this
fact was so known at the time by the Burlington company when
it received the product, and in turn each of the connecting lines
of the railroad and the steamship company knew such fact when
receiving such product, then it is not controlling that the receipts,
contracts, writings or bills of lading were through contracts or
bills of lading.
"It is important for you to determine whether the concession
of twelve cents per hundred after August 6 from the rates covered
by the schedules then on file with the commission was the result
of a device and whether done with guilty intent. It must have
been, before you can convict, the result of a device and with a
guilty intent, because if the shinner did not know it was receiving
concessions and did not have a guilty intent no crime would be
CONCESSIONS
OVERLAPPING CONTRACTS.
75
committed. As to device, is meant that which is devised or formed
by design, a contrivance, a project, a scheme to deceive, a strate-
gem or an artifice." (United States v. Armour Packing Co. et al.
U. S. Dist. Court, Eastern District of Missouri, June 12, 1906.)
§ 24. Criminal Liability - Concessions - Overlapping
Contracts. The Elkins Act renders the person or corporation
who receives a rebate liable in the same manner as a person
who solicits or accepts such rebate. Criminal proceedings
were instituted against both the carrier and the shipper for
a violation of the Elkins Act with regard to giving and re-
ceiving rebates. The cases were tried before Judge Mc-
Pherson in Kansas City, Mo., in June, 1906. The shippers
were tried first and convicted. See United States v. Armour
Packing Co., supra. The carrier, to wit, the Chicago, Bur-
lington and Quincy Railroad Company was also found
guilty upon the same charge upon which the shippers were
convicted, namely, for accepting a rate of twenty-three
cents per 100 pounds on shipments of lard consigned to
Germany via the Burlington railway, after the legal rate
was increased to thirty-five cents per 100 pounds. The
railroad company contended that the charge was legal be-
cause it had made a contract with the shippers to carry for
twenty-three cents per 100 pounds, which contract did not
expire until the 31st day of December, 1905, although on
the 6th of August, 1905, prior to the expiration of said con-
tract the tariff rates were increased from twenty-three cents
per 100 pounds to thirty-five cents per 100 pounds. The
carrier claimed, therefore, that upon this overlapping con-
tract it had a right to continue to charge but twenty-three
cents per 100 pounds. The railroad company claimed that
it had a joint rate under its contract with the Clover Leaf
and Lehigh Valley railroad to carry the packing-house
products at a rate which would have been valid had it been
published. They argued that the only crime committed, if
any, was the failure to publish the tariff under the contract,
while the indictment charged that the defendant granted a
concession from a portion of a through rate. That if a con-
cession was made at all it was on the entire or through rate
76
COMMENT AND AUTHORITIES.
and reduced the through rate, the amount of such concession,
but did not and could not be offered to any fractional part
of the through rate. Defendants claimed that the Burlington
railroad kept its contract, which was made in good faith and
kept in good faith and that, therefore, it was not guilty of
giving a rebate as charged in the indictment but was guilty
only of failure to publish and file its tariff rate. The United
States district attorney answered this contention by saying
that the facts disclosed a clear violation of the Elkins Act,
because the Burlington Railroad Company had made a con-
tract with the packing company at the rate of twenty-three
cents per 100 pounds and had continued to live up to that
contract after there had been filed with the Interstate Com-
merce Commission an amended tariff of thirty-five cents.
Judge McPherson charged the jury that the defendant, the
Burlington Railroad Company, had no right to make a con-
tract for a period longer than the established rate of twenty-
three cents should be in force. That by carrying shipments
for twenty-three cents after August 17, 1905, when the
tariff was raised to thirty-five cents, was, as matter of law,
a concession for which the railroad company was liable un-
der the indictment, and that the failure of the company to
file the schedule of twenty-three cents was wholly imma-
terial. Defendants were convicted. (United States v.
Chicago, Burlington & Quincy Ry. Co., tried June 13,
1906.)
VI. COMMERCE ACT-MANDAMUS.
§ 25. Mandamus-Effect of New Legislation as to.-
The Interstate Commerce Act was designed to regulate the
conduct of the carrier, and to protect the interest of the
shipper. In many instances the carrier succeeded in secur-
ing unjust preferences in favor of particular shippers, by
allowing the use of cars and terminal facilities to those
favored, to the exclusion of other shippers. In order to
remedy this evil, Congress, by the act approved March 2,
1889, added section 23 to the Commerce Act, thereby giv
ing to the shipper an additional summary and effective
remedy by writ of mandamus, to compel the carrier to move
MANDAMUS.
77
66
""
interstate traffic upon equal term to all shippers similarly
situated, and to furnish all shippers alike with cars or other
"facilities for transportation." Section 1 of the act de-
fines "transportation" as including "all instrumentalities
of shipment or carriage." This section was amended by the
act approved June 29, 1906, so as to include in the term
railroad" not only bridges and ferries, but "all switches,
spurs, tracks, and terminal facilities of every kind used or
necessary in the transportation of persons or property, freight
depots, yards, and grounds used or necessary in transporta-
tion or delivery of property." The term "railroad," under
the amendment, includes "cars and other vehicles, and all
instrumentalities and facilities of shipment or carriage.'
Transportation, the amendment declares, must be furnished
by the carrier "
upon reasonable request therefor." Section
3 of the act commands the carrier to furnish "equal facili-
ties" for interchange of traffic. Spur tracks, sidings, and
switches, under the 1906 amendment, are now expressly in-
cluded in the terms "transportation" and "terminal facili-
ties" and were designed doubtless to furnish a remedy for
such treatment as the shipper received, as shown in the case
of Harp v. Choctaw Railroad, 125 Fed. Rep. 445, C. C. A.
Eighth Circuit, October, 1903, and for which the court
could find no remedy. For a report of this case, see
"Sny-
der's Interstate Commerce Act," page 76.
§ 26. Mandamus - Jurisdiction of Federal Court as to.-
Congress has power to authorize a Circuit Court of the
United States to issue a writ of mandamus in an original
proceeding. In order to confer power to issue such a writ,
the act must be clear and explicit, and will not be construed
into the act, and the authority will not be conferred by im-
plication. Prior to 1906, neither section 20, nor section 12
of the Interstate Commerce Act, conferred authority upon a
Federal court to issue a writ of mandamus to compel a com-
mon carrier to make a report of the matters and things
specified in section 20 of the act. A grant of authority to
the commission to enforce the act and to institute "all neces-
sary proceeding for the enforcement of the provisions of the
78
COMMENT AND AUTHORITIES.
act, will not authorize a summary proceeding by mandamus."
(Knapp v. Lake Shore Ry. Co., 197 U. S. 536.)
In view of this decision, Congress, by the act approved
June 29, 1906, has given express authority to the court to
issue its writ of mandamus to enforce "any of the pro-
visions" of the Commerce Act, or of any act supplemental
thereto or amendatory thereof. See section 20 of the Com-
merce Act as amended 1906.
§ 27. Mandamus-Writ May Fix Percentage of Cars.—
Judge Goff, in United States ex rel. Kingwood Coal Co. v.
West Virginia R. R. Co., 125 Fed. Rep. 252, held that a
shipper could compel the carrier to furnish cars, and that
this right could be compelled by mandamus, under section
23 of the Commerce Act (added to the act by Laws 1889,
chap. 382, § 10, approved March 2, 1889), that an
alternative writ could be amended even after issue joined.
The writ granted by the court fixed the allotment of cars to
which relator was entitled. The ruling of Judge Goff was
affirmed by the Circuit Court of Appeals. In commenting
on the power of the court to fix the percentage of cars, the
court said:
"It is insisted in a proceeding of this character to fix
the percentage of cars the relator should have, and to com-
mand that such percentage of cars should be furnished to
the relator.' The acts of Congress forbade discrimination
and made it unlawful to give any undue or unreasonable
preferences or advantage to particular persons, companies,
corporations, or localities, or any particular description of
traffic, or to subject them to any undue or unreasonable
prejudice or disadvantage in any respect whatever,' and
vested jurisdiction in the Circuit and District Courts to
proceed by mandamus as a cumulative remedy for violations
of the statutory provisions.
We are unable to
accept the view that Congress intended to confine the scope
of the writ to admonition merely, or to a general command
to desist from discrimination, rather than from the par-
ticular action in which the discrimination consisted. By
the findings, the delivery to the relator of any less than 31
* * *
MANDAMUS.
79
per cent. of the supply amounted to unlawful discrimina-
tion, and the judgment of the court did no more than to
correct it." (West Virginia R. R. Co. v. United States ex
rel. Kingwood Coal Co., 134 Fed. Rep. 198.)
§ 28. Mandamus Right to Not Affected by Contract
With Carrier.-If there is no contract between the shipper and
the carrier, and no agreement entered into between them as to
the proportion of cars to which the shipper shall be entitled,
then the shipper may demand, under the Interstate Com-
merce Act, section 23 (added March 2, 1889, being section
10 of chapter 382, Laws 1889), and it will be the duty of
the court to direct the carrier by a writ of mandamus to
discharge the public duty imposed upon it by law, and to
move and transport traffic or to furnish cars or other facili-
ties for transportation to the party applying for the writ.
(West Virginia R. R. Co. v. United States ex rel. King-
wood Coal Co., 134 Fed. Rep. 198.)
The fact that the carrier made a contract with the shipper,
whereby the latter agreed to receive a certain proportion of
cars, as its allotment, to be furnished to it by the carrier,
will not deprive the shipper of his remedy by mandamus,
where the carrier failed to furnish the cars as agreed, and
failed to perform the contract with the shipper on its part.
It matters not how petitioner's right to an equal distribution
of cars may have arisen, whether by contract, statute, or
common law. If a contract has been entered into between
carrier and shipper, fixing the number of cars to which the
latter is entitled, and the carrier fails to perform it, thẹ
shipper may resort to a writ of mandamus to compel the
carrier to perform its duty under the statute; and the agree-
ment will be considered as in aid of the statute, by fixing, as
between the parties, what should be considered and accepted
as a compliance with its requirements. (United States ex
rel. Greenbriar Coal & Coke Co. v. Norfolk Ry. Co., 143
Fed. Rep. 266. February 6, 1906, Circuit Court of Ap-
peals, Fourth Circuit.)
The duty imposed by law upon a common carrier to fur-
nish the shipper with cars is a public duty. It is a duty im-
80
COMMENT AND AUTHORITIES.
posed upon the carrier by its charter, which is the law of its
creation. The carrier cannot relieve itself from the perform-
ance of this duty by executing a contract with the shipper.
The carrier owes a duty to the shipper, irrespective of any
contract it may see fit to make with regard to the perform-
ance of that duty. The contract would be merely an agree-
ment on the part of the carrier to perform a duty imposed
upon it by law. It would be contrary to public policy
and natural justice to assume that a common carrier could
be freed from the obligation it owed to the public, by
making a contract to perform such obligation. If this
could be accomplished, the carrier, by its own act, would
cease to be amenable to the statute, and could defeat the
purpose and intent of the Commerce Act by making a con-
tract and then refusing to perform it, leaving the shipper
practically remediless. An action at law by the shipper to
recover damages for a breach of the contract, furnishes the
latter no adequate remedy, and Congress recognizing this
fact gave the shipper a summary remedy of mandamus.
It will be observed further that this remedy was declared
by the statute not to be an exclusive remedy merely, but cumu-
lative. It was given to the shipper in addition to any other
remedy which he might have, including his remedy for dam-
ages against the carrier for the breach of the contract. Sec-
tion 22 of the Commerce Act in express words declares that
nothing in the act contained "shall in any way abridge or
alter the remedies now existing at common law or by stat-
ute, but the provisions of this act are in addition to such
remedies." And the new section, known as section 23, con-
ferring upon the court power to issue a writ of mandamus
against the carrier, compelling him to move and transport
traffic and to furnish cars or other facilities for transporta-
tion, contained the provision in express words that the
remedy given "by a writ of mandamus shall be cumulative
and shall not be held to exclude or interfere with other
remedies provided by this act, or the act to which it is a
supplement.'
""
It is obvious that while the court will not enforce a con-
tract between private parties by mandamus, this rule can
JURISDICTION OF FEDERAL COURTS.
81
have no application to a contract which is merely declara-
tory of a public duty imposed upon a common carrier. The
duty so imposed remains operative, whether the contract for
its performance has been made or not, and such duty, being
public, can be enforced by mandamus under the express pro-
visions of the Commerce Act. If this were not the rule, then
a carrier could defeat the statute by its own act, by making a
contract to do that which the law declares it must do, and
then refusing to perform the contract.
VII. COMMERCE ACT JURISDICTION
REMEDIES PROCEDURE.
EVIDENCE
§ 29. Jurisdiction of Federal Courts. In all cases aris-
ing under the Commerce Act, the Elkins Act, and the Sherman
Act, the jurisdiction of the Federal courts is exclusive. The
subject-matter of these statutes is interstate commerce, over
which, under the Constitution, Congress has supreme con-
trol. Congress may, if it sees fit, make the jurisdiction of
the Federal courts exclusive of the State courts, or, if no
provision is contained in the statute excluding jurisdiction
of the State courts, either expressly or by implication, they
can exercise concurrent jurisdiction with the Federal courts
in enforcing the statute. The Judiciary Act of March 3,
1875, as amended August 13, 1888, section 1,* declares that
"Circuit Courts of the United States shall have original
cognizance, concurrent with the courts of the several States,
of all suits of a civil nature, at common law or in equity,
where the matter in dispute exceeds, exclusive of interest
and costs, the sum or value of $2,000, and arising under the
Constitution or laws of the United States."
These acts, however, were passed after the Commerce Act
and the latter is not affected by them. (In re Hohorst, 150
U. S. 653; Railway Co. v. Gonzalez, 151 U. S. 496.)
If, however, Congress chooses to make the jurisdiction of
the Federal courts exclusive by the terms of the act, or such
exclusive jurisdiction arises by necessary implication, the
* For text of the statute see Snyder's Interstate Commerce Act, page
154.
82
COMMENT AND AUTHORITIES.
State court is barred from the concurrent jurisdiction which
it might otherwise have, and the act of Congress can be
enforced only in the Federal court. Section 9 of the Com-
merce Act vests in the District and Circuit Courts of the
United States jurisdiction to enforce the remedy of the shipper
claiming damages for its violation. Actions and proceedings
under the Commerce Act, therefore, derive their authority
solely from the statute, and the jurisdiction of the Federal
courts under it is exclusive. (Tift v. Southern Railroad
Co., 123 Fed. Rep. 789, and authorities there cited.)*
Section 16 of the Commerce Act, as amended June 29,
1906, also provides for a penalty and forfeiture to the
United States of $5,000 for failure to obey an order of the
Commission, made pursuant to section 15 of the act; every
distinct violation being a separate offense, and continuing
violations to be deemed separate offenses.
Section 4 of the Sherman Act authorizes its enforcement
by Federal officers in the Federal courts. Section 7 gives
the right to any person injured by any violation of its pro-
visions to sue in the Circuit Court of the United States, and
authorizes treble damages to be recovered in civil actions by
the injured party.
Section 1 of the Elkins Act provides for forfeitures and
penalties to the United States for three times the amount of
the rebate.
The jurisdiction under these statutes is vested directly in
the courts of the United States. They provide also for
penalties and forfeitures, as well as civil remedies. Under
section 9 of the Judiciary Act of 1789 (U. S. Rev. Stat.,
§ 711), the jurisdiction vested in the Federal courts, "of all
suits for penalties and forfeitures, incurred under the laws
of the United States," is declared to be exclusive of the courts
of the several States. This section of the Judiciary Act,
defining the exclusive jurisdiction of the Federal courts, is
as follows:
Exclusive Jurisdiction of Federal Courts. The jurisdiction
vested in the courts of the United States in the cases and pro-
* See Snyder's Interstate Commerce Act, page 155.
EXCLUSIVE JURISDICTION OF FEDERAL COURTS.
83
ceedings hereinafter mentioned, shall be exclusive of the courts
of the several States.
First:
Of all crimes and offenses cognizable under the author-
ity of the United States.
Second: Of all suits for penalties and forfeitures incurred
under the laws of the United States.
Third: Of all civil causes of admiralty and maritime juris-
diction; saving to suitors, in all cases, the right of a common-law
remedy, where the common law is competent to give it.
Fourth Of all seizures under the laws of the United States,
on land or on waters not within admiralty and maritime juris-
diction.
Fifth Of all cases arising under the patent-right or copyright
laws of the United States.
Sixth Of all matters and proceedings in bankruptcy.
:
Seventh: Of all controversies of a civil nature, where a State
is a party, except between a State and its citizens, or between a
State and citizens of other States or aliens. (U. S. Rev. Stat.,
§ 711. Judiciary Act of 1789, Laws, chap. 20, § 9.)
The pendency of an action in a State court, seeking relief
under the Sherman Act, therefore, is no bar to such an
action pending in the Federal court. (Loewe v. Lawlor,
130 Fed. Rep. 633. See also under Sherman Act, § 41,
post.)
page
§ 30. Jurisdiction Acquired only by Proper Service.-
In proceedings brought to enforce the provisions of the In-
terstate Commerce Act or of the Sherman Act of July 2,
1890, the court must acquire jurisdiction in the same man-
ner as in any action or proceeding in the Federal courts, by
proper service of the papers upon the defendant. The court
cannot acquire jurisdiction over the person of a defendant
except by actual service of a notice upon him within the
jurisdiction, or upon some one authorized to accept service
in his behalf, or by his waiver, by general appearance, or
otherwise, of the want of due service. The plaintiff in-
stituted proceedings in the District Court of the second
judicial district of the Territory of New Mexico against the
Santa Fé Pacific Railway Company, the Atchison, Topeka
and Santa Fé Railway Company, the Colorado Fuel and
Iron Company, and the American Fuel Company for alleged
violations of the Interstate Commerce Act, and of the
84
COMMENT AND AUTHORITIES.
Sherman Anti-Trust Act of 1890. A summons was issued
against the Santa Fé Pacific Railway Company, which was
served by the United States marshal, within the district,
upon E. P. Ripley, president of the defendant corporation.
Defendant was organized under an act of Congress, ap-
proved March 3, 1897. When Mr. Ripley, the president,
was served, he was a passenger on board a railway train
passing through the Territory. The company, however, had
its principal office in the city of New York. Its land com-
missioner had an office at Topeka, Kan., and its president
had an office in Chicago, Ill. The company had no property
in the Territory of New Mexico except lands acquired by it
under the foreclosure of a mortgage. It had no office or
place of business in the Territory since the sale of its road.
Upon a motion in which the defendant appeared especially
for the purpose of moving to quash the service of the
process, the court held that such service was wholly insuf-
ficient to confer jurisdiction upon the defendant corporation,
because it had no office in New Mexico, and mere ownership
of lands in New Mexico was not sufficient to locate the cor-
poration there for the purpose of a personal action against
it, and as there was no law in the Territory of New Mexico
authorizing service upon an officer of a corporation other
than a domestic corporation temporarily within the juris-
diction, the court held that the service was insufficient and
the judgment of the Supreme Court of the Territory of New
Mexico affirming the order to quash the return of the sum-
mons, and refusing to assume jurisdiction of the action as
against the Santa Fé Railway Company, and dismissing an
application for a writ of mandamus to compel the court to
assume jurisdiction, was affirmed. (Caledonian Coal Co.
v. Baker, 196 U. S. 432.)
§ 31. Federal Question.- Where the record of a case in
the State court shows that a Federal question was raised,
and, in the absence of an opinion, it appears from a cer-
tificate, made part of the record, that it was not raised too
late under the local procedure and that it was necessarily
APPEAL TO UNITED STATES SUPREME COURT.
85
considered and decided by the highest court of the State, a
Federal question is presented, which the Supreme Court of
the United States may review upon a writ of error. It is
enough that the Federal question was raised and necessarily
decided by the highest court of the State. (Cincinnati
Packet Co. v. Bay, 200 U. S. 179.)
•
8 32. Appeal Directly to Supreme Court of the United
States Under Act of February 11, 1903.- Under the act
expediting cases brought under the Interstate Commerce
Act, and under the Sherman Anti-Trust Law, in which the
United States is a party complainant, approved February
11, 1903, appeals to the United States Circuit Court of Ap-
peals are abolished and the appeal may be taken directly
from the Circuit Court to the Supreme Court of the United
States. The Act of February 11, 1903 (chapter 544), is
entitled "An act to expedite the hearing and determination
of suits in equity pending or hereafter brought under the
Act of July 2, 1890, entitled 'An act to protect trade and
commerce against unlawful restraints and monopolies,' 'An
act to regulate commerce,' approved February 4, 1887, or
any other acts having a like purpose that may hereafter be
enacted." Section 3 of the Elkins Act, approved February
19, 1903, declares that the provisions of the Expediting Act
which was passed on February 11, 1903, shall be applicable
to "any case prosecuted under the direction of the Attorney-
General in the name of the Interstate Commerce Commis-
sion." It was held that an appeal in a proceeding instituted
by the Attorney-General of the United States at the request
of the Interstate Commerce Commission to procure orders
requiring testimony of witnesses to be taken and to procure
the production of books, papers, and documents under a
complaint filed with the Interstate Commerce Commission
against carriers, could be taken directly from the Circuit
Court of the United States to the Supreme Court of the
United States. (Interstate Commerce Commission v. Baird,
194 U. S. 25.)
The proviso in section 3 of the Elkins Act making the
86
COMMENT AND AUTHORITIES.
provisions of the Expediting Act applicable to suits prose-
cuted by the Attorney-General of the United States in the
name of the Interstate Commerce Commission was not in-
serted in any restrictive sense, or to make clear that which
might be doubtful upon the general language used. It was
inserted for the purpose of enlarging the operation of the
statute (Elkins Act), so as to include a class of cases not
otherwise within the operation of the section. The court
observed (citing Minis v. United States, 15 Pet. 423; Geor-
gia Bank Co. v. Smith, 128 U. S. 174), that it might be
admitted that this use of a proviso is not in accord with the
technical meaning of the term or the office of such part of
a statute when properly used. But it is nevertheless a fre-
quent use of the proviso in Federal legislation to intro-
duce, as in the present case, new matter extending rather
than limiting or explaining that which has gone before.
(Interstate Com. Co. v. Baird, 194 U. S. 25.)
$ 33. Appeal Directly to Supreme Court Under Court
of Appeals Act, March 3, 1891.*- Appeals or writs of error
may also be taken from the District Courts or from the Cir-
cuit Courts direct to the Supreme Court, pursuant to sec-
tion 5 of Act of March 3, 1891 chapter 517, establishing
Circuit Courts of Appeals "in any case that involves the
construction or application of the Constitution of the United
States." In such cases the appeal to the Supreme Court
of the United States is authorized by the subject-matter of
the litigation, without regard to the diversity of the citizen-
ship of the parties. Where a bill of complaint contains
allegations sufficient to make a case of alleged violation of
constitutional rights, an appeal may be taken directly to the
Supreme Court of the United States, notwithstanding the
bill contains an allegation of diverse citizenship, as it appears
that the jurisdiction of the court is invoked upon the con-
stitutional grounds recited in the bill. (Field v. Barber
Asphalt Co., 194 U. S. 618.)
* For text of this statute see Snyder's Interstate Commerce Act,
page 172.
DOCUMENTARY EVIDENCE.
87
§ 34. Evidence - Documentary Evidence Under Com-
merce Act.— The Commerce Act, amended June 29, 1906,
makes certain reports, contracts, and data filed with the
Commission prima facie evidence of what they purport to
contain, and provides also for certified copies of extracts
from official records which may, when so certified, be offered
in evidence. The provisions of the act in this regard de-
fines such documentary evidence as follows:
1. Reports and decisions of the Commission are made
competent evidence in all courts of the United States. All
reports and investigations made by the Commission shall be
entered of record and copies furnished. (Commerce Act,
§ 14.)
2. Orders of the Commission awarding damages, and its
findings accompanying the order, are prima facie evidence of
the facts therein stated, and may be received in evidence on
the trial of damage suits, in Circuit Courts of the United
States. (Commerce Act, § 15.)
3. Copies of schedules and tariffs of rates, fares, and
charges and of all contracts, agreements, and arrangements
between carriers, and the statistics, tables, and figures therein
contained, and the annual reports of carriers, when filed with
the secretary of the Commission, are made public records, and
shall be received as prima facie evidence of what they pur-
port to be, in all investigations and judicial proceedings.
(Commerce Act, § 16.)
4. Copies or extracts from schedules, tariffs, contracts,
agreements, arrangements, or reports, which are made pub-
lic records by the act, shall be received in evidence when
certified by the secretary of the Commission under its seal.
(Commerce Act, § 16.)
§ 35. Remedies-Orders of Commission - Legislation
of 1906.- On and after August 28, 1906, the Interstate Com-
merce Commission will assume new powers. It is no longer
an inquisitorial and advisory body. It is an investigating
and prosecuting body, clothed with authority to enforce its
orders. Under the Act of June 29, 1906, the carrier, when
directed by the Commission to "cease and desist " from doing
88
COMMENT AND AUTHORITIES.
the acts specified in the order, must obey or disregard the
order at its peril. The statute (section 16) declares that it
shall be the duty of the carrier to comply with the orders of
the Commission, as long as they remain in effect. The
penalty prescribed is a forfeiture to the United States of
$5,000 for each offense. Distinct violations are made sepa-
rate offenses. Where an order is continuously violated from
day to day, each day shall be deemed a separate offense.
The power of the Commission, however, is limited by
reason of the fact that it cannot make its order effective
immediately. In this regard Congress did not adopt the
recommendation of the President in his message, that the
law be amended so as to provide that the ruling of the Com-
mission “take effect immediately, and obtain, unless and
until reversed by the court." The orders of the Commission,
other than orders containing a direction for the payment of
money to the shipper by way of damages or reparation, can-
not become effective until a period of thirty days after the
order is made. The carrier may utilize this period of time
as a sort of locus penitentia if it intends to obey the order.
But if it seeks to review it, the carrier can bring suit in the
Federal court to "enjoin, set aside, annul, or suspend" the
order. The provision designed to prevent an ex parte in-
junction restraining the enforcement of the order, and de-
claring that no such restraining order shall be granted, ex-
cept after a hearing, on not less than five days' notice, will not
necessarily operate to prevent the order of the Commission
from taking effect until the suit is tried. The hearing to
secure an injunction can be heard and decided within the
thirty-day period, and if the injunction is granted the order
of the Commission will be suspended. The injunction will
prevent the order from taking effect after the thirty-day
period, when it would otherwise have become operative.
The penalty of $5,000 per day for failure to obey the
order would not ensue, in case the injunction should be
denied, within the thirty-day period. If the injunction
were denied, and thereafter the order became effective, pcnd-
ing the suit by the carrier to set it aside, the penalty could
run only from the time the order became effective. It can
ORDER OF REPARATION
DAMAGES.
89
in no case become effective until thirty days have elapsed
after the order is made, and then only on the date specified
in the order. The Commission may postpone the time of
taking effect, to any later period, beyond the thirty days,
which it deems reasonable.
§ 36. Orders for Payment of Money -Damages.
Orders, which the Interstate Commerce Commission is au-
thorized to make, are divided into two classes: (1) Orders
for the payment of money; (2) Orders other than for the
payment of money. Orders for the payment of money are such
as contain a direction to the carrier requiring it to pay money
to the shipper or complainant, as compensation for dam-
ages sustained, arising from any violation of the Commerce.
Act, and to make reparation to the complainant. The party
aggrieved may elect under section 9, either to sue the car-
rier for damages in a Circuit or District Court of the United
States, or complain to the Interstate Commerce Commission,
claiming damages. The remedies are not concurrent and
the aggrieved party must elect which remedy he will pursue.
More delay will be experienced in enforcing an order for
the payment of money, awarding damages by way of repara-
tion, for the reason that the lawfulness of the order must be
tested in a trial by jury. On writ of error from a judgment
for money damages, entered upon a verdict, the Circuit
Court of Appeals can review the rulings of the trial court,
and can review the evidence, in order to ascertain whether,
as matter of law, it is sufficient to sustain the verdict.
(New York Ry. Co. v. Pennsylvania Refining Co., 137 Fed.
Rep. 343.) The law, as amended, now allows the shipper
to litigate his case without becoming liable for costs. He is
not liable for costs, except in case he appeals, and then only
for the costs on appeal.
Under section 13 the petitioner may make his complaint.
Upon issue joined by the carrier's answer, the Commission
may take testimony, and make an award as provided by
section 16, and an order directing the carrier to pay the
award on or before a day named in the order. If the carrier
fails to comply, the complainant must enforce the order by
90
COMMENT AND AUTHORITIES.
bringing suit upon it in the Circuit Court of the United
States.
In the case cited, Western New York Ry. Co. v. Pennsyl-
vania Refining Co., 137 Fed. Rep. 343, the Circuit Court of
Appeals said that the substantial object of an action upon
an order for reparation made by the Commission is to ob-
tain the reparation lawfully ordered to be paid. The law
allows no appeal from the decision of the Commission deny-
ing or awarding reparation, nor does a writ of error lie in
such case.
The lawfulness of an order of reparation does.
not necessarily depend upon a sufficiency of evidence, ad-
duced before the Commission, but upon the existence of facts,
whether or not disclosed to that body, warranting the repara-
tion ordered; and in an action brought to obtain such repara-
tion, based on the order of the Commission, it is enough that
such facts be established by proper evidence. "Hence,"
says the court, "in such an action the parties are not con-
fined to the evidence adduced before the Commission during
the investigation resulting in the order of reparation. They
are at liberty, either wholly or partially, to rely upon the
findings of fact' made by the act prima facie evidence in
any judicial proceeding as to each and every fact found,'
or resort may be had by them or any of them to cumulative
or other evidence. The cause of action is examined de novo
and the proceeding is, in a qualified sense, independent of
the investigation by the Commission." (Western New York
Ry. Co. v. Pennsylvania Refining Co., 137 Fed. Rep. 343.)
i
(
The facts were as follows: the Pennsylvania Refining Com-
pany, Limited, of Oil City, Pa., on December 4, 1888, made a
complaint to the Commission against the Western New York
and Pennsylvania Railroad Company and Samuel G. De-
Coursey, receiver thereof, and against the Lehigh Valley
Railroad Company to recover damages for excessive and un-
lawful transportation charges upon shipments of oil. After
a hearing, the Commission, on October 22, 1895, directed the
Western New York and its receiver to pay the claimant
$8,579, with interest from May 15, 1894, and directed the
other defendants, New York, Lake Erie and Western and
others, to pay the claimant $343.58, with interest from May
STANDARD OIL CASES.
91
15, 1894.
Defendants refused to comply with the orders
and plaintiff brought actions thereon in the Circuit Court of
the United States for the Western District of Pennsylvania.
The cases were tried before a jury, in May, 1902, and plain-
tiff had a verdict against the Western New York for $12,-
706.92, including interest, and for $514.30 against the New
York, Lake Erie and Western and others. Judgment was
entered, and defendants sued out a writ of error to the Cir-
cuit Court of Appeals. Both judgments were reversed upon
technical grounds. One of the grounds was that the com-
plainant failed to obtain an order of court for leave to sue
the receiver of one of the carrying companies, notwithstand-
ing the fact that the statute expressly makes the receiver
primarily liable.
It appeared that in September, 1888, the freight rates
on refined oil in barrels, from the Pennsylvania oil regions
to New York, was raised by the carrier to sixty-six cents
a prohibitive tariff. Complaint was made to the Interstate
Commerce Commission on December 4, 1888, and in May,
1889, a hearing was had before the Commission. On No-
vember 14, 1892, the Commission decided against the car-
riers, holding that they were guilty of unjust discrimination.
A rehearing was granted by the Commission in October,
1893. Upon the hearing on October 22, 1895, damages were
awarded to the shippers in the orders above referred to. In
May, 1896, the petitioners sued in equity upon the orders
in the Circuit Court of the United States for the Western
District of Pennsylvania. In July, 1897, the court declined
jurisdiction on its equity side, holding that the remedy was
upon the law side of the court in an action triable by jury.
The case was placed upon the calendar, and was tried and
rcsulted in a verdict by the jury in favor of the refiners,
which judgment was entered in February, 1903. These
judgments were set aside by the Circuit Court of Appeals
in May, 1905, in the decision cited above. After the lapse
of seventeen years, the shippers found themselves in about.
the position they were in when the litigation was begun.
These cases were referred to and commented upon during
the discussion of the railway rate bill of 1906, in the Senate,
92
COMMENT AND AUTHORITIES.
66
and doubtless lead to the distinction, in section 16 of the
amended act, between orders. "lawfully" made and orders
regularly" made. That section provides that if the
carrier refuses to obey any order of the Commission, other-
than an order for the payment of money, the order may be
enforced in equity by the Commission upon petition setting
forth the substance of the order and the respect in which the
carrier has failed of obedience. The section declares that
such an order, if found to be "regularly" made, shall be
enforced by injunction. If, however, the carrier desires to
review the facts de novo, and to attack the lawfulness of the
order, it must do so in a suit brought in the Circuit Court
of the United States against the Commission to enjoin, set
aside, annul, or suspend the order. The difficulty with mak-
ing this provision applicable to an order for the payment of
money arises from the fact that a claim for damages must
be tried before a jury. In order to protect the shipper, as
far as possible, the law provides that the burden of proof is
on the carrier to successfully defeat the order before the
jury. It is made prima facie evidence of the facts therein
stated.
As an order
§ 37. Order for Damages, how Enforced.
awarding damages is based upon the allegation that the de-
fendant carrier has been guilty of a breach of duty, or a
breach of contract, the issue must be tried by a jury, unless
jury trial is waived by defendant. An action to recover
damages in other words, is an action at law, and not a suit
in equity, and section 7 of the Constitution declares that
'in suits at common law, where the value in controversy
shall exceed twenty dollars, the right to trial by jury shall
be preserved." It is necessary, therefore, in order to enforce
n order for damages, to sue on the order, and try the case
before a jury in the United States Circuit Court for the
district where the petitioner resides, or the district in which
is located the principal office of the carrier. A petition must
be filed stating briefly the facts and the order of the Com-
mission.
The law, however, in such a suit, gives the petitioner a
1
ORDERS OF COMMISSION
HOW ENFORCED IN EQUITY. 93
decided advantage, because he makes his case by putting in
evidence the order and findings of the Commission. With
these in evidence he may rest his case, because the law
(section 16) makes them prima facie evidence on the trial
"of the facts therein stated." If a recovery is had, the
petitioner shall be allowed an attorney's fee to be taxed and
collected as part of the costs of the suit. If petitioner is de-
feated no costs can be awarded against him, unless he ap-
peals, and then in case of an affirmance, he must pay only
the costs on the appeal. The petition for damages before the
Commission must be filed within two years from the time the
cause of action accrues. Suit must be brought on the order
within one year from its date.
§ 38. Orders Enforced in Equity.-All orders of the Com-
mission, other than orders for the payment of money, must
be enforced in proceedings on the equity side of the court,
by injunction or other mandatory process, and in such pro-
ceedings the court shall have the powers "ordinarily exer-
cised by it in compelling obedience to its writs of injunction
and mandamus." An order for damages must be enforced by
the party to whom the damages are awarded or for whose
benefit the order is made. An order, other than for the pay-
ment of money, may be enforced by the Interstate Com-
merce Commission or by any party injured. It may be en-
forced either in a Circuit or District Court of the United
States. It must be enforced by petition, setting forth the
substance of the order, "and the respect in which the car-
rier has failed of obedience." The court directs in what
manner the facts shall be investigated, and if it appears that
the order was "regularly made and duly served," and that
it has been disobeyed, the court shall enforce obedience by
injunction or other mandatory process.
This enforcement is summary, for the reason that in such
a proceeding the court cannot review the "lawfulness" of
the order. It must ascertain only whether the order was
"regularly" made. In other words, the inquiry will be
limited to the question as to whether the Commission had
jurisdiction. If it appears that, in making the order, all
94
COMMENT AND AUTHORITIES.
the requirements of the statute as to service of papers and
opportunity for hearing have been observed, then the Com-
mission had jurisdiction and the order will have been
"regularly made."
§ 39. Lawfulness of Order How Reviewed.-Whether
an order of the Commission is or is not lawful cannot be tried
in a proceeding by the Commission, or by the party injured,
to enforce the order in a court of equity. In a proceeding
to enforce the only inquiry presented is, was the order of the
Commission sought to be enforced "regularly made?" Did
the Commission have jurisdiction to make it? If the order
is "regular" it must be enforced.
If the order is sought to be attacked on the merits, and a
trial had de novo before the court, the proceeding must be
instituted by the carrier who fails to obey it, in a suit
brought by the carrier against the Commission “to enjoin,
set aside, annul, or suspend the order." In this regard,
therefore, the distinction under the statute between orders
"regularly" made, and orders "lawfully" made, is apparent.
§ 40. Evidence-Burden of Proof-Findings of Com-
mission Prima Facie Evidence.- The Interestate Commerce
Act, authorizing investigation and inquiry by the Interstate
Commerce Commission, creates a presumption in favor of
the correctness of the Commission's report. The Legisla-
ture may create rules of evidence and modify or alter or
change the same, subject only to the limitations imposed by
the provisions of the Constitution. When a body created by
an act of Congress is required to take testimony as to the
reasonableness of a rate or charge for transportation, the
findings and conclusion of the Commission and its report,
when offered in evidence in any judicial proceeding, is
prima facie evidence of all the facts found by the Commis-
sion, and the burden of proof is cast upon the party against
whom the report is made to rebut the facts and conclusions
set forth in the report.
BURDEN OF PROOF DRUG TRUST.
95
Section 14 of the Commerce Act declares that the "find-
ings of fact set forth in the report of the Commission shall
in all judicial proceedings be deemed prima facie evidence
as to each and every fact found." This rule is repeated in
section 16 of the Commerce Act, relating to trial of issues by
jury, which declares that at "the trial of the findings of
fact of said Commission as set forth in its report, shall be
prima facie evidence of the matters therein stated." The
report of the Commission, therefore, is entitled to such
evidential effect that the complainant may introduce the
report in evidence and rest his case, and he will be entitled
to judgment on the report unless the adverse party, by pre-
ponderant and controlling evidence, shall rebut and disprove
the findings. (Lilienthal's Tobacco Co. v. United States,
97 U. S. 268.)
The Interstate Commerce Commission, which has been
entrusted by Congress with the duty of determining, in the
first instance, the character of a rate charged for transporta-
tion, whether the same shall be reasonable or unreasonable,
must be regarded as an expert tribunal. "Our view is,"
said Hon. EMORY SPEER, "that it would be violation of ex-
plicit law, the settled policy of government, and the most
practical principles of reason and justice for the courts of
the nation, save for controlling reasons of law or fact, to
discredit or disparage the conclusions of the Interstate Com-
merce Commission." (Tift et al. v. Southern R. R. Co.,
138 Fed. Rep. 753. June, 1905, Circuit Court, southern
district, Georgia.)
§ 40a. Burden of Proof
Drug Trust.— In an action to
recover damages under the Sherman Act, by a party injured
by an illegal combination, known as the drug trust, the burden
of proof is on plaintiff to show the unlawful conspiracy, and
that some real, actual damage was sustained by plaintiff by
reason thereof. In such a case it is within the discretion of
the trial court to admit evidence of acts and declarations of
various defendant associations, their officers, committees,
members, and agents, made in the absence of many of the
other defendants, before a prima facie case of conspiracy had
been established, and before privity of some of the defend-
96
COMMENT AND AUTHORITIES.
ants had been proven, on condition that connecting evidence
should be thereafter supplied. (Loder v. Jayne, 142 Fed.
R. 1010. Circuit Court, eastern district, Pa., Jan. 22,
1906.)
§ 40b. Pleadings Under Sherman Act.- The U. S. Circuit
Court for the District of New Jersey, January, 1905, in the
Rice case, infra, held that in a suit to recover damages under
section 7 of the Sherman Act, the pleader, in the opinion of
the court, was bound by section 110 of the New Jersey Prac-
tice Act (P. L. 1903, p. 569) which authorizes the court to
strike out a declaration, if it appears to be irregular and de-
fective, and so framed as to prejudice, embarrass and delay a
fair trial of the action.
The construction given to the Sherman Act by the court
in Rice v. Standard Oil Co., 134 Fed. Rep. 464, was alto-
gether technical, and was based upon the theory that the
act in question was a penal and not a remedial statute. That
theory has been repudiated by the Supreme Court of the
United States, not only as to the Sherman Act, but also as to
the Interstate Commerce Act, and the Safety Appliance Law.
Justice WHITE in the Chesapeake and Ohio Case, 200 U. S.
261, in an opinion concurred in by every member of the
court, expressly declared that the Commerce Act was a reme-
dial statute, and, therefore, "entitled to receive that interpre-
tation which reasonably accomplishes the great public purpose
which it was enacted to subserve." A like construction was
given to the Sherman Act in the Addyston Pipe Case, 175 U.
S. 211; in the Northern Securities Case, 193 U. S. 197, and
in Montague v. Lowry, 193 U. S. 35; and to the Safety Appli-
ance Law in Johnson v. Southern Pacific Co., 196 U. S. 1.
In the latter case the court said, that while the statute was
in its nature penal, such construction must be given to it as
will fairly carry out the legislative intent.
In the Rice Case, supra, the narrow construction given to
the Sherman Act required the pleader to include in his com-
plaint a bill of particulars, and much of his evidence. The
court, in order to defeat the pleading, resorted to the technical
distinction between a "contract" in restraint of trade, and
(6
ASSIGNED CLAIMS IN FEDERAL COURT.
97
a conspiracy" in restraint of trade, quoting on this point
from the dissenting opinion of Mr. Justice HOLMES, in the
Northern Securities Case. The views in the dissenting
opinion relied upon by the court in the Rice Case, however,
were not adopted in the prevailing opinion concurred in by
other members of the court, and was not thereafter followed
by Mr. Justice HOLMES in a later case under the Sherman
Act, in which he sustained an injunction against the "Beef
Trust," writing the opinion concurred in by every member
of the court. (Swift v. United States, 196 U. S. 375.)
•
The complaint in the Rice Case, after setting forth the com-
bination and conspiracy entered into by defendant, set forth
the acts done which resulted in damage to plaintiff, and
alleged that defendant and its associates intimidated mer-
chants and others engaged in the business of selling oil in
various markets, and thus prevented such merchants and
others from purchasing and dealing in oil manufactured by
the plaintiff. The plaintiff also alleged that defendants
hampered plaintiff in getting the necessary supplies of crude
oil, and made the said crude oil more expensive to plaintiff,
and hindered, delayed and made more expensive the work
of plaintiff in the construction of the pipe line for his use,
to his damage.
The court held that the complaint was vague, indefinite
and uncertain, in that it did not set forth the names of the
merchants or other persons intimidated, the specific acts of
intimidation, or the particular markets in which such prac-
tice was carried on, or the details as to the manner in which
plaintiff was hindered and delayed by defendant, although
this information might well have been supplied by a bill of
particulars. (Rice v. Standard Oil Co., 134 Fed. R. 464.)
§ 40c. Assignment of Claims - Jurisdiction - Rights of
Assignor in Federal Court.-The general rule as to the
jurisdiction of assigned claims in the Federal courts, where
the claim arose upon contract, is that the assignee cannot
maintain his action and the court will not have jurisdiction,
unless the suit might have been prosecuted in the Federal
court by the assignor, if no assignment or transfer had been
made. The exception to this rule seems to be in cases of
7
98
COMMENT AND AUTHORITIES.
foreign bills of exchange and commercial paper made by a
corporation.
The act of Congress, conferring jurisdiction upon the
Federal courts, U. S. Rev. Stat., section 629, as amended by
Act of March 3, 1891, ch. 137, provides as follows:
Jurisdiction as to Assigned Claims.—*** Nor shall
* Nor shall any Cir-
cuit or District Court have cognizance of any suit, except upon
foreign bills of exchange, to recover the contents of any promissory
note, or other chose in action in favor of any assignee, or any
subsequent holder, if such instrument be payable to bearer, and be
not made by any corporation, unless such suit might have been pros-
ecuted in such court to recover the said contents, if no assignment or
transfer had been made.
Under this rule a "chose in action" not arising in tort
cannot be assigned by a resident of the State of which the
defendant against whom the cause of action exists is a citi-
zen, to a resident of another State, in order to permit the
assignee to sue in the Federal court. In such case, if the
cause of action is not one of which the Federal court has
exclusive jurisdiction, the assignee cannot sue in the Federal
court, because his assignor could not have sued in that juris-
diction. If the assignor and the assignee are both citizens
of a State, other than that of which defendant is a citizen,
the cause of action can be assigned, and the suit can be main--
tained in the Federal court by the assignee of the claim
upon the ground of diversity of citizenship.
A suit upon contract to recover an amount due from the
defendant, which defendant agreed to pay out of funds put
into defendant's hands for that purpose, is "a chose in
action" within the meaning of the statute which refers to
"the contents of any promissory note or other chose in
action," and the assignee of such a claim cannot maintain an
action upon it in the Federal court if his assignor could not
have sued in the Federal court prior to the assignment.
(Mexican Nat. Railroad v. Davidson, 157 U. S. 201.)
In the case cited the cause of action arose in favor of the
assignor, the Mexican National Construction Company, a
citizen of Colorado, against the Mexican National Railroad
ASSIGNED CLAIMS JURISDICTION FEDERAL COURT. 1 99
Company, also a citizen of Colorado.
The construction
company assigned its claim and cause of action to plaintiff,
John A. Davidson, a citizen of the State of New York, who
brought suit upon it in the State court, New York county,
and secured a warrant of attachment thereon against defend-
ant as a non-resident. Defendant removed the cause into
the Federal court, plaintiff and defendant being residents of
different States, where plaintiff had judgment. The United
States Circuit Court of Appeals on certiorari certified the
question of jurisdiction to the Supreme Court. The latter
court held that as the assignor, being a citizen of Colorado,
could not have sued defendant, also a citizen of Colorado, in
the Federal court, his assignee could not, and that upon re-
moval of the action from the State court the Federal court
acquired no jurisdiction. (Mexican National Railroad v.
Davidson, 157 U. S. 201.)
See also same principal, Plant Investment Co. v. Jackson-
ville, 152 U. S. 71; Brock v. Northwestern Fuel Co., 130
U. S. 341; Shoecraft v. Bloxham, 124 U. S. 730; Cross v.
Allen, 141 U. S. 528; Crawford v. Neal, 144 U. S. 585;
Metcalf v. Watertown, 128 U. S. 585; New Orleans v. Whit-
ney, 138 U. S. 595.
In an action arising upon tort to recover damages for
trespass on lands of plaintiffs' assignor, the statute has no
application. One injured party may assign his claim, and
the assignee may maintain an action thereon in the Federal
court although the other injured party did not assign his
chose in action, and the assignor could not have sued the
defendant in the Federal court. (Ambler v. Eppinger, 137
U. S. 480.)
A municipal corporation is not within the statute, and a
cause of action against it may be assigned, and the assignee
may bring suit thereon in the Federal court. (Andes v. Ely,
158 U. S. 312.)
It was held also that the statute did not apply to a nego-
tiable bond. (Dodge v. Tully, 144 U. S. 45.)
40d. Switches on Private Land- Injunction.- A
switch was built upon private land to connect with the tracks
100
COMMENT AND AUTHORITIES.
of the carrier, the Louisville and Nashville Railroad. The
switch led from the quarries of the parties who constructed it,
and was used for the purpose of shipping stone. Subsequently
the rails and ties and the switch property was transferred
to the carrier. Common carriers are quasi public corpora-
tions, and in accepting their charters they assume and im-
pliedly agree to perform those public duties which the law
imposes on common carriers. These duties require them to
the extent of their resources to furnish adequate facilities
for the transaction of all business offered, and to deal fairly
and impartially with their patrons. And these duties may be
enforced in equity by injunction. And this law prevailed
prior to the passage of the Interstate Commerce Act. (Munn
v. Illinois, 94 U. S. 126; McCall v. Cincinnati, Indianapolis,
etc., Railroad, 13 Fed. R. 5.)
By the acceptance of their charters, carriers assume a pub-
lic trust which clothes the public with an interest in the
railroad, in so far as the right of user is involved, which can
be controlled by the public to the extent of the interest so
conferred.
A common carrier has no right to contract with a corpora-
tion or individual to give exclusive rights to transfer any
commodity over any part of its line. (Oman v. Bedford-
Bowling Green Stone Co., 134 Fed. R.
64.)
VIII. CRIMINAL TRUSTS UNDER SHERMAN ACT.
§ 41. Jurisdiction - Action Pending in State Court when
no Bar Under Sherman Act.- When suits are pending be-
tween the same parties for the same cause in State and Fed-
eral courts, the jurisdiction of the latter resting upon diversity
of citizenship, a plea in abatement alleging the pendency of
one will be futile against the other. (Gordon v. Guilfoil,
99 U. S. 168.) But where the State court is without juris-
diction to enforce the remedy sought in the same action
pending in the Federal court, the same cause cannot be
pending in both. A State court has no jurisdiction to en-
force the provisions of the Sherman Act, and the pendency
of an action for that purpose is no bar to a suit to enforce
the act in the Federal court. (Loewe v. Lawlor, 130 Fed.
Rep. 633.)
MEASURE OF DAMAGES SHERMAN ACT.
101
§ 42. Municipal Corporation May Recover Damages
Under.— A municipal corporation engaged in supplying its
citizens water, gas, or electric light, is "a business corpora-
tion," and under section 7 of the Sherman Act may main-
tain an action to recover treble the damages which it has
sustained by reason of a combination or conspiracy in re-
straint of trade and commerce in violation of the act.
(City of Atlanta v. Chattanooga Foundry Co., 127 Fed.
Rep. 23. December, 1903, C. C. A., sixth circuit.)
The city of Chattanooga operated its own water-works
and realized therefrom large profits from sale of water to
private consumers. The city, in the conduct of its business,
was obliged to purchase large quantities of iron pipe and
water mains. It was claimed that the price of this com-
modity was unlawfully enhanced by defendants, who were
subsidiary companies forming part of a trust, by suppressing
competition in interstate commerce in the sale of iron pipe.
That by reason of such conspiracy plaintiff was compelled
to buy pipe from defendants, both Alabama corporations.
That defendants agreed with the parent company to pay a
"bonus" to the trust in order to get the bid from the city
for the sale of the pipe through the instrumentality of fic-
tictious bids. That this bonus was $15,000, which was added
to the purchase price and paid to the trust. That the price
was extortionate, and was $15,000 more than the city would
have paid but for the unlawful conspiracy entered into by de-
fendants forming part of the trust. At the trial defendants
had a verdict by direction of the court. On appeal this
verdict was reversed. The court held that plaintiff, though a
municipal corporation, could maintain the action, and that
defendants were constituent companies of the Addyston
Pipe and Steel Company, which the Supreme Court had
declared to be an illegal trust. (City of Atlanta v. Chatta-
nooga Foundry Co., 127 Fed. Rep. 23.)
§ 43. Measure of Damage Under Sherman Act.- If the
members of an illegal conspiracy in restraint of trade are
able to prevent competition in the sale of a commodity
which is a subject of interstate commerce, and as a result
102
COMMENT AND AUTHORITIES.
the price of the commodity is enhanced and plaintiff is
obliged to pay the enhanced price for the commodity used
in his business, the measure of damages sustained by the
business of the purchaser will be the difference between the
price paid and the reasonable price of the commodity under
natural competitive conditions. This difference, in the case
of iron pipe purchased by plaintiff, was held to be $15,000,
shown to be a bonus paid to the trust over and above the
reasonable value of the pipe. (City of Atlanta v. Chatta-
nooga Foundry Co., 127 Fed. Rep. 23.)
$ 44. Liability of Individual Members of a Trust.—
The fact that only two members of an unlawful combine
are sued for damages under the Sherman Act is not a de-
fense to the action. If the agreement between defendants
and their associates was unlawful and tortious, each is re-
sponsible for the torts committed in the course of the illegal
combination. That if defendants participated in the bene-
fits resulting from a bonus paid to defendants and their
associates, who were not parties to the action, they cannot
complain that they were sued alone. (City of Atlanta v.
Chattanooga Foundry Co., 127 Fed. Rep. 23.)
§ 45. Statute of Limitations Applicable to Sherman Act.
A suit to recover damages under section 7 of the Sherman
Act is not an action for a penalty or forfeiture under sec-
tion 1047 U. S. Rev. Stat., which declares that a suit
to recover a penalty or forfeiture, "pecuniary or otherwise,
accruing under the laws of the United States," must be
brought within five years. A suit for damages under the
Sherman Act is an action to enforce a civil remedy for a
private injury, as compensatory damages. Nor does the fact
that the damages may be trebled change the nature of the
action, such excessive recovery being by way of exemplary
damages.
The Statute of Limitations under the Sherman Act is
governed by the Statute of Limitations governing actions of
a similar character prevailing in the State where the action
is brought. (City of Atlanta v. Chattanooga Foundry Co.,
127 Fed. Rep. 23.)
BEEF TRUST ILLEGAL.
.103
§ 46. Beef Trust an Unlawful Conspiracy Under. The
Circuit Court of the United States for the northern district
of Illinois in April, 1903, in a suit brought by the United
States against Swift & Company and a number of corpora-
tions, firms, and individuals of different States engaged in
the preparation and sale of meats, held that defendants were
engaged in an unlawful conspiracy and combination in re-
straint of trade and commerce within the meaning of the
Sherman Act. The corporations are known as the packers, or
the beef trust. They interposed a demurrer in the court be-
low which was overruled and a preliminary injunction was
granted restraining the defendants from entering into, taking
part in, or performing any contract, combination, or con-
spiracy as to trade and commerce in fresh meats. The defend-
ants appealed from the judgment below to the Supreme Court
of the United States, which affirmed the judgment modifying
the injunction appealed from only by striking therefrom the
words "any other method or device."* The injunction, as
modified, restrains combinations only to the extent of cer-
tain specified devices which the defendants are alleged to
have used and intended to have continued to use. (Swift
& Co. v. United States, 196 U. S. 375; affirming United
States v. Swift, 122 Fed. Rep. 529.)
Mr. Justice Holmes summarizes the bill of complaint as
follows: "It charges a combination of a dominant propor-
tion of the dealers in fresh meat throughout the United
States not to bid against each other in the live stock mar-
kets of the different States; to bid up prices for a few days
in order to induce the cattle men to send their stock to the
stock yards; to fix prices at which they will sell, and to that
end to restrict shipments of meat when necessary; to establish
a uniform rule of credit to dealers and to keep a blacklist, to
make uniform and improper charges for cartage; and, finally,
to get less than lawful rates from the railroads to the
exclusion of competitors. It is true that the last charge is
not clearly stated to be a part of the combination. But
it is alleged that the defendants have each and all arrange-
*For text of the injunction, see Snyder's Interstate Commerce Act, page 289.
104
COMMENT AND AUTHORITIES.
ments with the railroads that they were exclusively to enjoy
the unlawful advantage, and that their intent in what they
did was to monopolize the commerce and to prevent compe-
tition."
The court further observed in sustaining the injunction
that although the combination alleged embraced restraint
and monopoly of trade within a single State, its effect upon
commerce among the States is not accidental, secondary,
remote, or merely probable. On the allegations of the bill
the latter commerce no less, perhaps even more, than com-
merce within a single State is an object of attack. (Leloup
v. Port of Mobile, 127 U. S. 640, 647; Crutcher v. Ken-
tucky, 141 U. S. 47, 59; Allen v. Pullman Co., 191 U. S.
171.) The subject-matter is sales, and the very point of
the combination is to restrain and monopolize commerce
among the States in respect to such sales.
As to the contention that the bill was too vague and did not
set forth a case of commerce among the States, the court said:
"Commerce among the States is not a technical legal concep-
tion but a practical one, drawn from the course of business.
When cattle are sent for sale from a place in one State,
with the expectation that they will end their transit after
purchase in another, and when in effect they do so, with
only the interruption necessary to find a purchaser at the
stock yards, and when this is a technical, constantly recurring
course, the current thus existing is a current of commerce
among the States, and the purchaser of the cattle is a part
and incident of such commerce."
"" The court observed fur-
ther that no more powerful instrument of monopoly could
be used than an advantage in the cost of transportation.
(Swift v. United States, 196 U. S. 375.)
§ 47. Stock Quotations, when not Within. There is a
property right in market news whose dissemination is help-
ful to commerce, as quotations of prices on sales of grain
and provisions for future delivery, which a court of equity
will protect by injunction. Persons who disseminate such
news may invoke the protection of a court of equity, and
the right to sell such quotations will not be deemed infected
STOCK QUOTATIONS PROTECTED.
105
with illegality or beyond judicial protection because the owner
of the news maintains an exchange where parties receiving
such quotations do not contemplate an actual delivery of
the goods whose prices are quoted. Nor will such contracts
be deemed illegal because the information is sold to certain
persons, and withheld from others, where the persons pro-
hibited from receiving such quotations are what are known
as bucket-shops. A business so conducted is not void as
against public policy, nor as being in restraint of trade,
whether at common law or under the Anti-Trust Act of
July 2, 1890, known as the Sherman Act. (May, 1905.
Board of Trade v. Christie Grain and Stock Co., 198 U. S.
236.)
acts.
The court further held that if plaintiff's collection of
information is entitled to protection, it does not cease to be
so entitled even if it secures information concerning illegal
The statistics of crime are property, to the same ex-
tent as any other statistics, even if collected by a criminal
who furnishes some of the data. Plaintiff's collection of quo-
tations is like a trade secret. The plaintiff has the right to
keep the work which it has done, or paid for doing, to
itself. The fact that others might do similar work if they
might, does not authorize them to steal the plaintiff's. (Ib.)
§ 48. Sale of Steamboats and Business of Carrier, when
not Within - Trust When Contract of Sale of Steam-
boats is not. An action was brought by a vendor against
a vendee to recover an installment of money due under a
contract for the sale of certain steamboats and barges en-
gaged in traffic on the Ohio river. The contract was for the
sale of two steamers, two deck barges, two coal flats, and
$500 in the stock of the Coney Island Wharf Boat Company.
The contract contained a provision that in case of opposition.
to the boats sold, by other boats running from Cincinnati to
Portsmouth, Ohio, or to points above Portsmouth, not in-
cluding points above Syracuse, Ohio, causing it to carry
freight and passengers at certain exceedingly low rates, the
time of payment of the installment should be postponed until
the opposition ceased. The agreement also contained a
106
COMMENT AND AUTHORITIES.
provision that if the opposition continues for two years
without interruption, and no actual payment be made, the
vendee might cancel the contract. It contained a further
agreement that the vendors should not engage in running or
in operating, or in any way be interested in any freight or
passenger or packet business, or either of them, at and from
Cincinnati, Ohio, to Portsmouth, Ohio, and intermediate
points at and from Portsmouth, Ohio, to Cincinnati, Ohio,
and intermediate points or at and from Syracuse or points
between Syracuse and Portsmouth, Ohio, to or from points
below Portsmouth, Ohio, for a period of five years. A pro-
vision was also inserted that the vendee would maintain the
rates charged by the vendor on business above Portsmouth,
Ohio, said rates, however, never to exceed present rates be-
tween said points. It was claimed that this contract was
not within the condemnation of the Sherman Act because
it did not in terms relate to Interstate Commerce. The court
held, however, that even if it did contemplate interstate
commerce, it would not be in violation of the Sherman Act
for the reason that the provisions of the contract were merely
incidental to the sale of a business, and were not and could
not be construed as a device to control commerce within
the meaning of the Sherman Act. The court said the agree-
ment to maintain the rates was not the covenant sued upon
and did not form part of the consideration of the sale. (C'in-
cinnati Packet Co. v. Bay, 200 U. S. 179.)
$ 49. Sale of Mercantile Business and Good Will, when
not Within.- An agreement by the seller of property, or of
a particular business, not to compete with the buyer for a
specified period of time (ten years), in such a way as to
impair or compete with the business sold, is not a contract
in restraint of trade and commerce within the purview of
the Sherman Act. (Booth & Co. v. Davis, 127 Fed. Rep.
875. Circuit Court, eastern district, Michigan, January 19,
1904.)
In the case cited complainant sought to enjoin defendant
Davis from violating his contract with plaintiff not to en-
gage directly or indirectly in the fish business, and to re-
SALE OF GOODS OUTSIDE STATE.
107
strain defendant, the Wolverine Fish Co., Limited, from
benefiting in any way by the services and experience of de-
fendant Davis. Plaintiff purchased the property and good-
will of the Davis Company, a Michigan corporation, and the
corporation and all of its officers and stockholders, as part
of the contract of sale, agreed not to engage in the business
for ten years. Defendants claimed that the contract of sale
was void under the Sherman Act, and that such contracts
were also prohibited by the Michigan Anti-Trust Act of
June 23, 1899.
The injunction was granted on the ground that the con-
tract was not within the Sherman Act, and that the Michi-
gan Anti-Trust Act, in force in 1889, when the sale was
made, was repealed in 1899, when a new Anti-Trust Act
was passed. The new statute was passed after the sale was
consummated, and the court held that it was not retroactive
in its operation. (Booth & Co. v. Davis, 127 Fed. Rep.
875.)
§ 50. Agreement not to Sell Goods Outside the State not
Within Sherman Act. It was not the purpose of the Sher-
man Act to prohibit ordinary contracts or combinations of
manufacturers, or the usual devices to which they resort to
enhance their trade and make their occupation gainful, so
long as they do not directly restrict competition in com-
merce among the States. A Kansas corporation engaged in
the manufacture and sale of cement at Iola, Kan., sold to
defendant and his firm 50,000 barrels of cement to be
shipped free on board at Iola to Galveston, Tex., at $1.20
per barrel. Defendants agreed
Defendants agreed "not to sell said cement,
ship same, or allow same to be shipped" outside the State
of Texas. Part of the cement was received and paid for;
the remainder defendants refused to receive or pay for. In
a suit for the price the defense was that the contract of
sale was void under the Sherman Act. Held, that the agree-
ment of sale imposed no direct restriction on competition
in commerce among the States, and was valid and not
within the prohibition of the Sherman Act. (Phillips v.
Iola Portland Cement Co., 125 Fed. Rep. 593. Novem-
108
COMMENT AND AUTHORITIES.
ber, 1903.)
See also Whitwell v. Continental Tobacco Co.,
125 Fed. Rep. 454.
8 51. Illegal Contract Under When not Enforceable-
Rights of Parties. Neither party to an illegal contract will
be aided by the court, whether to enforce it or to set it
aside. If the contract is illegal, affirmative relief against
it will not be granted at law or in equity unless the con-
tract remains executory, or unless the parties are consid-
sidered not in equal fault, as where the law violated is
intended for the coercion of the one party and the protec-
tion of the other, or where there has been fraud or oppres-
sion on the part of the defendant. Where the parties are
in pari delicto, and the contract has been fully executed on
the part of the plaintiff by the conveyance of property or
by the payment of money and has not been repudiated by de-
fendant, it is well settled that neither a court of law nor a
court of equity will assist the plaintiff to recover back the
property conveyed or money paid under the contract.
held where the plaintiff sought to recover back stocks and
securities sold by him to the defendant under a contract
which had been adjudged void as in violation of the Sher-
man Act known as the railroad merger, which was declared
to be illegal. (Northern Securities Co. v. United States, 193
U. S. 197.) The court applied the maxim in pari delicto
potior est conditio defendentis, notwithstanding the fact that
the parties claimed to have acted in good faith and without
intention to violate the law. With knowledge of the facts
and of the statute, neither can plead ignorance of the law as
against the other, and defendants secured no unfair advantage
in retaining the consideration voluntarily delivered for the
price agreed. (Harriman v. Northern Securities Co., 197 U.
S. 244.)
§ 52. Book
Trust
So
Copyright - Blacklisting Void
Under Sherman Act.- A combination of publishers and
booksellers was formed in two associations, known re-
spectively as the "American Publishers' Association" and
the "American Booksellers' Association." They controlled
COPYRIGHT
BLACKLISTING
SHERMAN ACT. 109
90 per cent. of all copyrighted books. The object of the
combine was to fix prices, and to compel publishers and deal-
ers to sell at the prices so fixed. The compulsion was
brought about by blacklisting those who refused to be
governed by the combine as to prices, and by refusing to
such the privilege of purchasing, owning, or selling copy-
righted books controlled by the associations, thus injur-
ing, and in some instances destroying, the business of dealers
outside the combine. The agreement under which such
associations were formed, so far as they related to inter-
state commerce, were declared to be null and void within
the provisions of the Sherman Anti-Trust Law. (Bobbs-
Merrill Co. v. Straus et al., 139 Fed. Rep. 155. February,
1905, Circuit Court, southern district, New York.)
In the case cited the complainant sought to enjoin defend-
ants from selling at retail a copyrighted novel entitled
"The Castaways" at less than $1 per copy. The defense
interposed was that defendants purchased the books in the
open market and acquired title to them, and had a right to
sell them at any price they chose. Defendants claimed also
that the suit was brought by plaintiffs to enforce an agree-
ment in restraint of trade and commerce which was void
under the Sherman Act.
The court held that if a publisher of a book, being the
proprietor of the copyright, parts with the title to the book,
either a single copy or a number of copies, and receives
his pay therefor, he has parted with all control over such
books, and the purchaser can sell them in the open market
for any price he chooses. The court held further that while
it is no defense to a trespass upon complainants' rights that
it has violated or is violating the Sherman Anti-Trust Law
(General Electric Co. v. Wise, 119 Fed. Rep. 922), yet
if it appears that complainant has turned over to the illegal
combine the fixing of prices, and has become a member of
such unlawful combination, and is attempting to enforce
the illegal agreements of such combination, the action can-
not be maintained. A plaintiff cannot use the courts to
enforce agreements forbidden by law. He that comes into
equity must come with clean hands. The facts before the
110
COMMENT AND AUTHORITIES.
court having shown that defendant had absolute title to the
copyrighted books sold by it, and that the suit was, in effect,
an attempt to enforce the rules of a trust prohibited by law,
the complaint was dismissed. (Bobbs-Merrill Co. v. Straus,
139 Fed. Rep. 155.)
$ 53. Book Trust - When Owner of Copyright can Con-
trol Sale. The publisher of a book, who also owns the copy-
right, can control the conditions upon which the book shall
be sold only so long as he retains title to the copies of the
work. In the exercise of such ownership he can lawfully
restrict the manner in which, and the persons to whom, the
book can be sold. Such restrictions being protected by the
copyright could not be said to be an unlawful restraint of
trade under the Sherman Act. The right to restrain the
sale, however, is gone when the owner of the copyright or
copyrighted work has parted with title to the books, and con-
fers absolute title on the purchaser, even if the sale be ac-
companied with an agreement for restricted use, or for a
sale at a fixed price. Under such an agreement a con-
tractual relation arises, and the remedy, if any, is for
damages for its breach. But where title passes to the vendee
of the copyrighted book, or books, the vendee cannot be
restrained by injunction in an equity suit from disposing
of them. (Scribner v. Straus, 139 Fed. Rep. 193. July
1905, Circuit Court, southern district, New York.)
§ 53a. Patent Right will Protect Trust. The fact that
the subject matter of a monopolistic combination is covered
by patent-rights, will, if there be no illegality in other re-
spects, protect the combination from the penal provisions of
the Sherman Act. If the use of the patented articles does
not infringe upon the police powers of the State, the patent
will be upheld, even though the effect be to keep up a monop-
oly and fix prices. (Bement v. Nat. Harrow Company, 98
U. S. 70.)
“The very object of the patent laws," says PECKHam, J.,
in the case cited, "is monopoly, and the rule is, with few
exceptions, that any conditions which are not in their very
PATENT RIGHTS
BOYCOTT
SHERMAN ACT. 111
nature illegal with regard to this kind of property, imposed
by the patentee, and agreed to by the licensee for the right
to manufacture or use or sell the article, will be upheld by
the courts." The fact that the tendency will be to control
prices of the patented article will not render such contracts
void, as in restraint of trade within the provisions of the
Sherman Act. (Bement v. Nat. Harrow Co., 98 U. S. 70.)
It was held, however, that where the patentee of an inven-
tion for the manufacture of rubber tire went beyond the
rights secured to him by his patent in raising and main-
taining prices in States where the patcnt had no practical
existence, and in raising a fund to crush competition by out-
side manufacturers in localities where the patent was in
force, as well as in those where it had no practical existence,
such contracts were within the purview of the Sherman Act
as a conspiracy in restraint of trade, and void. (Rubber Tire
Wheel Co. v. Milwaukee Rubber Works Co., 142 Fed. R. 531.
Jan. 23, 1906, Circuit Court, Wisconsin eastern district.)
$ 54. Boycott-Conspiracy to Boycott Restrained by
Injunction. Under the Sherman Act every contract, combi-
nation in the form of trust or otherwise, or conspiracy in
restraint of trade or commerce among the several States or
with foreign nations is forbidden. Such unlawful con-
tracts and conspiracies may be restrained by injunction.
A combination and conspiracy having for its immediate
object the injury and destruction of the private business
of an individual, firm, or corporation by means of a boycott
is an unlawful conspiracy at common law, and may be re-
strained by injunction. Such a combination and conspir-
acy does not lose its criminal character, or become lawful,
by reason of the fact that the acts contemplated and done
pursuant thereto might be lawfully done by an individual
acting for himself alone. (Lowe v. California State Fed-
eration of Labor et al., 139 Fed. Rep. 71. July, 1905,
Circuit Court, northern district, California.)
The case cited arose upon a motion to continue a temporary
injunction pendente lite issued in an action by plaintiffs, a
firm of hat manufacturers of Danbury, Conn., against the
112
COM
COMMENT AND AUTHORITIES.
California State Federation of Labor and others, to restrain
the defendants from in any manner conspiring together to
destroy the trade and business of complainants; from boy-
cotting the complainants' business, or the product of their
factory; from publishing or otherwise circulating statements
of representations calling the attention of complainants'
customers, or of dealers, or of tradesmen, or of the public
to a boycott or strike against the complainants, from threat-
ening or intimidating the customers of complainants, or
the public, or persons combined with complainants, or per-
sons buying products of complainants' facter from any other
person, firm, or corporation by any means set forth in the
bill of complaint.
The contention of defendants was that a single individual,
acting on his own responsibility, might do the things com-
plained of, and that in so doing he would not be guilty of
any unlawful act; and that, therefore, what was lawful for
an individual to do does not become unlawful by reason of
the fact that the acts complained of are done by a number
of individuals. The court held that this contention was
wholly untenable, and made the distinction between the re-
sults of concerted action by means whereof an individual
is deprived of his just rights, as distinguished from the acts
of an individual which result in harm to no one. The
intention by one man, so long as he docs nothing, is not a
crime which the law will take cognizance of, and so, too, the
intention of any number of men acting separately. But when
several men form the intention, and come together and agree
to carry their intent into execution, the case is changed.
The agreement is a step in the direction of accomplishing
the purpose. The combination becomes dangerous and sub-
versive of the rights of others, and the law says it is a crime.
On this point the court cited from an opinion by Mr. Jus-
tice HARLAN in Arthur v. Oakes (63 Fed. Rep. 310; s. c.,
11 C. C. A. 209), as follows:
"It is one thing for a single individual or for several individ-
uals, each acting upon its own responsibility and not in co-oper-
ation with others, to form the purpose of inflicting actual injury
upon the property or rights of others. It is quite a different thing,
BLACKLISTING PROHIBITED.
113
in the eye of the law, for many persons to combine or conspire
together with the intent not simply of asserting their rights, or
of accomplishing lawful ends by peaceable methods, but of employ-
ing their united energies to injure others or the public. An in-
tent upon the part of a single person to injure the rights of others
or of the public is not in itself a wrong of which the law will
take cognizance, unless some injurious act be done in execution
of the unlawful intent. But a combination of two or more per-
sons with such an intent, and under circumstances that give them,
when so combined, a power to do an injury they would not possess
as individuals acting singly, has always been recognized as in
itself wrongful and illegal."
The court also cited from the opinion of Mr. Justice
HOLMES in Aikens v. Wisconsin (195 U. S. 194), in con-
struing a Wisconsin statute forbidding "two or more
persons to combine for the purpose of unlawfully and mali-
ciously injuring another in his reputation, trade, business,
or profession by any means whatever." In that case the
court said that the liberty to combine to inflict injury upon
another was not among the rights which the Fourteenth
Amendment was intended to preserve, and that the defense
that motives are not actionable cannot prevail in deter-
mining the extent to which a person can justify harm which
he has foreseen. If the acts were intended and the in-
jury foreseen, it is no defense to say that motives are not
actionable. The court continued the injunction. (Lowe
et al. v. California State Federation of Labor et al., 139
Fed. Rep. 71. July, 1905, Circuit Court, northern dis-
trict, California.)
§ 54a. Blacklisting Prohibited as to Employees of Car-
riers Engaged in Interstate Commerce.- National Trades
Unions, and controversies between carriers and their em-
ployees are governed by an act of Congress, approved June
29, 1886, entitled "An Act to legalize the incorporation of
Trades Unions" (Laws 1886, ch. 567); and also by an act
approved June 1, 1898, entitled "An Act concerning carriers
engaged in interstate commerce and their employees." (Laws
1898, ch. 370.)
Section 3, of the act of 1898, provides for a board of arbi-
tration to settle disputes and controversies between employer
8
111
COMMENT AND AUTHORITIES.
and employee. Section 10 of this act makes it a misdemeanor
for the carrier to require the employee to agree "not to be-
come or remain a member of any labor corporation" or organ-
ization as a condition of employment, or to threaten loss of
employment, or to discriminate, because of membership in
any labor corporation or organization; or who, having dis-
charged an employee shall "attempt or conspire to prevent
such employee from obtaining employment, or who shall,
after the quitting of an employee, attempt or conspire to pre-
vent such employee from obtaining employment.'
""
It is declared by section 8 of this (1898) statute that every
national trade union must embody in its articles of incorpo-
ration "and in the constitution, rules and by-laws," a pro-
vision that a member "shall cease to be such by participating
or by instigating force or violence against persons or property
during strikes, lockouts, or boycotts, or by seeking to prevent
others from working, through violence, threats or intimida-
tion." The section declares that members "shall not be per-
sonally liable for the acts, debts, or obligations of the corpora-
tions, nor shall such corporations be liable for the acts of
members or others in violation of law."
54b. Injunction of Proceedings in State Court When
Forbidden.- Congress, in order to secure the orderly admin-
istration of proceedings pending in State courts, as to matters
concerning which the Federal courts have no jurisdiction, has
forbidden the latter to issue an injunction to stay pro-
ceedings in the State courts, unless proceedings in bankruptcy
are involved. The Federal statute in this regard is as follows:
Injunction as to State Courts.- The writ of injunction shall not
be granted by any court of the United States, to stay proceedings
in any court of a State, except in cases where such injunction may
be authorized by any law relating to proceedings in bankruptcy.
U. S. Rev. Stat., § 720.
This provision of the United States revised statutes was
construed and commented upon, in regard to proceedings in
the State courts of Kentucky, which were stayed by the Fed-
eral court, in the case of Oman v. Bedford-Bowling Green
Stone Co., 134 Fed. R. 64.
1
COMMON LAW IN FEDERAL COURTS.
· 115
IX. STATE ANTI-TRUST LAWS-COMMON-LAW TRUSTS.
§ 55. State Anti-Trust Laws.- Congress can legislate only
as to interstate commerce. The power conferred by the Con-
stitution authorizes it to regulate commerce among the
several States. It has no power to legislate with regard to
commerce conducted wholly within the borders of a State.
Power to forbid trusts, contracts, combinations, or con-
spiracies in restraint of trade within State lines resides in
the State Legislature. Since the passage of the Sherman Act,
approved July 2, 1890, known as the Sherman Anti-Trust
Law, which prohibits every contract, combination in the
form of trusts or otherwise, or conspiracy in restraint of
trade or commerce among the several States, Legislatures
of various States of the Union have, from time to time, en-
acted similar laws prohibiting conspiracies in restraint of
trade within the borders of the respective States. Many of
these State laws have been sustained and declared valid by
the Supreme Court of the United States.
In a number of States, however, no anti-trust laws have
been enacted, and the question constantly arising is, how
far monopolies or criminal conspiracies to enhance the price
of necessaries of life, can be punished criminally in those
States where the common law prevails, and in which no
statutes have been enacted to punish unlawful conspiracies
in restraint of trade and commerce.
§ 56. Federal Courts Cannot Punish Common-Law
Trusts. Under the Judiciary Act of 1789 (U. S. Rev. Stat.,
§ 711), supra ($ 40), the Federal courts have exclusive
jurisdiction over "crimes and offenses cognizable under
the authority of the United States." The Constitution
authorizes Congress to punish three classes of crimes:
(1.) Counterfeiting. (2.) Piracies and felonies on the
high seas. (3.) Treason. The Federal courts, however,
although courts of general jurisdiction, are also courts
of limited jurisdiction in the sense that they cannot punish
crimes, except such as are defined by Congress, which must
designate the crime and fix the punishment because they
116
COMMENT AND AUTHORITIES.
possess no common-law jurisdiction over crimes. (United
States v. Hudson & Goodwin, 7 Cranch, 32; United States
v. Coolidge, 1 Wheat. 415; Wheaton v. Peters, 8 Pet. 591;
State of Pennsylvania v. Wheeling Bridge Co., 13 How.
518.)
The Judiciary Act of 1789 did not establish a Penal Code.
That legislation is contained in the Crimes Act of April 30,
1790, U. S. Rev. Stat., Title LXX. That act contains no
provision making monopolies and criminal conspiracies in
restraint of interstate trade and commerce crimes. No
Federal statute on that subject was passed until Congress
enacted the Sherman Act, approved July 2, 1890.
While there is no Federal common law with respect to
crimes, the common law in so far as it relates to civil ac-
tions, both at law and in equity, will be administered in.
the Federal courts. They will enforce the common law as
they find it in the respective States as adopted and modified
by the State in which the Federal court is sitting, unless.
the rule has been superseded by an act of Congress upon
the subject. (U. S. v. Lancaster, 2 McLean, 431; U. S.
v. Wiltberger, 5 Wheat. 76; Pennsylvania v. Wheeling
Bridge Co., 13 How. 18; Wheaton v. Peters, 8 Pet. 591;
U. S. v. Burr, 2 Rob. 481; U. S. v. Worrall, 2 Dall. 384.)
The settled rule is, therefore, that the common law in
criminal cases cannot be administered in the Federal courts,
and their jurisdiction does not extend to offenses unless
they are made crimes by an act of Congress.
This rule as to the enforcement of the common law in
civil cases, rests upon the principle that in so far as the
common law has been adopted by a State, it becomes part of
the local law and of the jurisprudence of that State, and
in justice to its citizens, and to enforce their civil rights, Con-
gress has expressly commanded that the Federal courts shall
enforce the laws of the several States unless in conflict with
the Constitution or laws of the United States. The statute
(U. S. Rev. Stat., § 721), provides as follows:
Laws of the States in Federal Courts. The laws of the several
States, except where the Constitution, treaties, or statutes of the
1
COMMON LAW IN FEDERAL COURTS.
117
United States shall otherwise require or provide, shall be re-
garded, as rules of decision in trials at common law, in the courts
of the United States in cases where they apply. (U. S. Rev.
Stat., § 721.)
Congress by this statute, subject to the qualifications of
the act, has adopted the common law which has been adopted
in the respective States, and has conferred upon the Federal
courts authority to apply such common law in the States
where it is invoked in civil actions. The Federal courts,
however, are not bound to follow the construction put upon ·
the law by the State courts, but have a right to construe it
according to their judgment as to its meaning and inter-
pretation. If a right is claimed in a Federal court based
upon principles of the common law, reference must be made
to the common law of the State where the Federal court
is sitting in which the controversy arose. Whether such
common-law rule relied upon exists, and the extent or limi-
tation of the rules, must be determined by the judicial de-
cisions, statutes, if any, and the usages and customs thereof.
If the common-law rule exists as claimed, and is appli-
cable to the case, and is not abrogated or superseded by the
Constitution, or a law or treaty of the United States, it
will be the duty of the Federal court to regard it as a rule of
decision in the Federal court.
An illustration of this principle is shown in United States
v. Garlinghouse, 4 Ben. 194. Mrs. Garlinghouse, a mar-
ried woman, was engaged in business as a distiller in the
State of New York. She executed a bond to the United
States in the penal sum of $20,000, conditioned upon her
compliance with the warehouse and internal revenue laws.
In a suit upon the bond in 1870, defendant pleaded her
coverture as a defense, and claimed that, being a married
woman, she had no legal capacity to execute the bond.
argued that at common law the bond was void. The answer
was that under the laws of the State of New York defendant,
though a married woman, was authorized to engage in busi-
ness as a distiller on her own account, for her own benefit,
and was competent to execute the bond under the New York
statute. The court, therefore, held the bond to be valid
She
118.
COMMENT AND AUTHORITIES.
under the lex loci contractus. That the common-law rule
was binding on the Federal court only in so far as it ex-
isted or had been modified or abrogated by the State of
New York where the contract arose, and where the action
was tried. That the common-law rule as to married women
had been so far modified in that State as to remove the dis-
ability of a married woman as to her separate business, and
authorized her to engage in business on her own account, and
that under the statutes of New York defendant was not dis-
qualified to execute a bond in connection with her own
business.
The courts of the United States have never adopted the
common law as a whole, by any general rule of court, and
have no power to do so. "And yet,” says Mr. SPEAR, in his
work on the Federal Judiciary, "in the disposal of civil
cases relating to legal rights and their remedies, these courts
have, from the commencement of the government, looked
to the common law as a repository of doctrines and prin-
ciples to which they might refer for the purpose of under-
standing the meaning of statutes and constitutional pro-
visions, and which, in the absence of statutes directing them,
or otherwise requiring, they might adopt, and apply, as con-
taining pertinent and proper rules for their guidance in the
exercise of the powers conferred on them by express law, and
in determining questions relating to the rights of the parties
in the cases pending before them.'
""
§ 57. Common Law, as to Trusts and Conspiracies in
Restraint of Trade.-The Federal courts have no jurisdiction
over crimes and offenses, other than those cognizable under the
laws of the United States. Congress has no power to legislate
with respect to trade or commerce carried on wholly within
the borders of a State. In the absence of a State Anti-Trust
Law, therefore, the only redress is the common law, under
which a conspiracy to control the price of necessaries of life
is an indictable offense. Sir William BLACKSTONE, the most
distinguished commentator on the common law of England,
says that criminal conspiracies in restraint of trade and
TRUSTS AND CONSPIRACIES AT COMMON LAW. 119
commerce were defined as the offense of "forestalling the
market," the offense of "engrossing" and "monopolies."
The offense of forestalling the market" would, in
modern parlance, be declared a trust, as it relates to public
trade generally, while "engrossing" was confined to bread-
stuffs and victuals. Blackstone declares that the offense of
forestalling the market, and of engrossing, were offenses at
common law, indictable and finable. He says the offense is de-
scribed by Statute 5 & 6 Edward VI., chap. 14, "to be the
buying or contracting for any merchandise or victual coming
in the way to market; or dissuading persons from bringing
their goods or provisions there; or persuading them to en-
hance the price when there; any of which practices make the
market dearer to the fair trader." (Book IV, page 158.)
Engrossing he defines as "buying up large quantities of
corn or other dead victuals with intent to sell them again.
This must, of course, be injurious to the public, by putting
it in the power of one or two rich men to raise the price of
provisions at their own discretion." The punishment for
these offenses, as in other minute misdemeanors, was, at com-
mon law, discretionary fine and imprisonment. (1 Haw.
P. C. 235.) Monopolies, he declares, are contrary to public
policy and void.
Criminal conspiracies at common law were defined by Lord
Mansfield, one of England's greatest judges, on a motion
made before him for leave to file an information against de-
fendants for conspiracy to raise the price of salt. The de-
fendants owned salt works at Droitwitch, and were charged
with raising the price of that commodity. The motion was
granted. In his opinion, granting the motion, Lord Mans-
FIELD observed: "If an agreement was made to fix the price
of salt, or any other necessary of life, by people dealing in
that commodity, the court would be glad to lay hold of an
opportunity, from what quarter soever the complaint came,
to show their sense of the crime, and that at what rate soever
the price was fixed, high or low, made no difference, for all
such agreements are of bad consequence and ought to lo dis-
continued." (King v. Morris, 2 Kenyon's Notes of Cases,
300.)
120
COMMENT AND AUTHORITIES.
It has been held that this rule of the common law still
prevails in the United States, in those States which have
enacted no statutory regulations governing the subject. The
modern cases, and later authorities, fully sustain the doctrine
that any association of two or more persons combining for
the dishonest purpose of creating monopolies in those
commodities which comprise the necessaries of life, or to
enhance their market price, to the prejudice and injury of
the general public consumer, is a criminal conspiracy at com-
mon law, subjecting the offenders to fine and imprisonment.
In States where there are no statutes, or Anti-Trust Laws
punishing conspiracies in restraint of trade, this rule of the
common law has been frequently applied. (Commonwealth
v. Carlisle, Bright's N. P. (Pa.) 36; Commonwealth v.
Miskey, 15 Phila. (Pa.) 356; Nester v. Continental Brew-
ing Co., 161 Pa. St. 473; Chicago, etc., Coal Co. v. People,
114 Ill. App. 75; People v. The Milk Exchange, 145 N. Y.
267; People v. Sheldon, 139 N. Y. 251; People v. Fisher,
14 Wend. 9.)
In the Illinois case, defendants were indicted for con-
spiracy to regulate and fix the price of coal. In September,
1902, they fixed the price at $2.90 a ton. In the following
month, October 13, 1902, they increased the price about $1
a ton. Defendants were held guilty of conspiracy, and the
court, among other things, observed: "All combinations
among persons or corporations, for the purpose of raising or
controlling the prices of merchandise or any of the neces-
sarics of life, are monopolies.
* Where the act to be
done by such combination necessarily tends to prejudice the
public, or to oppress individuals, the combination has always
been held to be criminal."
*
*
The plea that a trust may be beneficial because the result.
may reduce, or does reduce, the price of the commodity, was
answered by the New York Court of Appeals in the Milk
Exchange case (145 N. Y. 267), by this pertinent obser-
vation:
"It may be, as claimed, that the purpose of the combina-
tion was to reduce the price of milk, and that it being an
KANSAS ANTI-TRUST LAW SUSTAINED.
121
article of food, such a reduction was not against public
policy. But the price was fixed for the benefit of the dealers,
and not the consumers, and the logical effect upon the trade
of so fixing the price by the combination, was to paralyze the
production and limit the supply, and thus leave the dealers
in the position to control the market, and, at their option, to
enhance the prices to be paid by the consumers. This brings
the case within the authorities to which we have referred."
A reference to the Anti-Trust Laws of the various States
are given infra, indicating those, also, in which the common
law prevails. The authorities in those States which have no
statute bearing on the subject will be obliged to resort to the
common-law rule to invoke a remedy for criminal conspira-
cies in restraint of trade to control the price of the necessaries
of life.
§ 57a. State Anti-Trust Laws Upheld.-A State has power
to enlarge the rule of the common law, and to prohibit com-
binations in restraint of trade within its borders, where such
combinations limit competition in the production or sale of
articles, or increase or reduce prices, in order to preclude
free and unrestricted competition. The Legislature of a
State has power to declare that competition, and not com-
bination, shall be the law of trade. It may lawfully prohibit
combinations to control prices. Held accordingly that a
State Anti-Trust Law, containing such provisions (Laws of
Texas, 1889, 1895, and 1899), was constitutional and bind-
ing, and did not deprive persons of property without due
process of law. (Waters-Pierce Oil Co. v. Texas, 177 U. S.
28; National Cotton Oil Co. v. Texas, 197 U. S. 115.)
§ 58. Kansas Anti-Trust Law Sustained.-The Supreme
Court of the United States has held that a State has power
to pass a law forbidding persons within its borders to com-
bine with others or to create a pool to fix the price of neces-
saries of life, to divide the net earnings, and to prevent
competition in the purchase of such articles; and sustained
an act of the Legislature of the State of Kansas, passed for
122
COMMENT AND AUTHORITIES.
that purpose, on the 8th of March, 1897. The act in ques-
tion provides as follows:
Kansas Anti-Trust Act.-Sec. 1. A trust is a combination of
capital, skill, or acts, by two or more persons, firms, corporations,
or associations of persons, or either two or more of them, for
either, any or all of the following purposes: First.-
First. To create
or carry out restrictions in trade or commerce or aids to com-
merce, or to carry out restrictions in the full and free pursuit of
any business authorized or permitted by the laws of this State.
Second. To increase or reduce the price of merchandise, produce
or commodities, or to control the cost or rates of insurance.
Third. To prevent competition in the manufacture, making,
transportation, sale or purchase of merchandise, produce or com-
modities, or to prevent competition in aids to commerce. Fourth.-
To fix any standard or figure, whereby its price to the public shall
be, in any manner, controlled or established, any article or com-
modity of merchandise, produce or commerce intended for sale,
use or consumption in this State. Fifth. To make or enter into,
or execute or carry out, any contract, obligation or agreement of
any kind or description by which they shall bind or have to bind
themselves not to sell, manufacture, dispose of or transport any
article or commodity, or article of trade, use, merchandise, com-
merce or consumption below a common standard figure or by
which they shall agree in any manner to keep the price of such
article, commodity or transportation at a fixed or graded figure,
or by which they shall in any manner establish or settle the
price of any article or commodity or transportation between them
or themselves and others, to preclude a free and unrestricted
competition among themselves or others in transportation, sale
or manufacture of any such article or commodity, or by which they
shall agree to pool, combine or unite any interest they may have
in connection with the manufacture, sale or transportation of
any such article or commodity, that its price may in any manner
be affected. And any such combinations are hereby declared to
be against public policy, unlawful and void." (Laws of Kansas,
1897, p. 481.)
The defendant was convicted by a jury under this statute
for combining with others to fix the price of grain, to divide
the net earnings, and to prevent competition in the purchase
and sale of grain. The court sustained the validity of the
Kansas statute, and held that its provisions were not in con-
flict with the Fourteenth Amendment to the Federal Con-
stitution. The court held that there was a certain freedom
of contract which cannot be destroyed by legislative enact-
ment, and that it is not always easy to draw the line between
LIABILITY FOR GOODS PURCHASED FROM TRUST. 123
those contracts which are beyond the reach of the police
power and those which are subject to prohibition or restraint.
The court observed, however, that "a secret arrangement by
which, under penalties, an apparently existing competition
among all the dealers in a community, in one of the neces-
saries of life, is substantially destroyed without any merg-
ing of interests, through partnership or incorporation, is one
to which the police power extends." The court observed
further that the defendant could not object to the statute
merely because it operated oppressively upon others. The
hurt must be to himself." (Smiley v. Kansas, 196 U. S.
447.)
§ 59. Missouri Anti-Trust Law - Purchaser Relieved
in Suit by the Trust. One of the most drastic provisions
of State anti-trust legislation is that which seeks to relieve a
purchaser from liability for goods purchased from the trust.
The law authorizes the purchaser, in an action brought by
the trust to recover the price of goods, to plead that plaintiff
is a trust, as a complete defense to the action. This pro-
vision will be found in the laws of many States. It is in-
corporated in the Missouri statute, which provides as follows:
"Any purchaser of any article or commodity from any indi-
vidual, company or corporation transacting business contrary to
any provision of the preceding sections of this article shall not be
liable for the price or payment of such article or commodity, and
may plead this article as a defense to any suit for such price or
payment." (Laws 1891, chap. 143. Mo. Rev. Stat. 1899, § 8977.)
In an action brought in the Circuit Court, City of St.
Louis, by the Cahill-Swift Manufacturing Company against
Joseph F. Walsh, to recover the value of materials furnished
the defendant, the latter set up as a defense to the action,
that plaintiff was a member of a "trust" or conspiracy
in restraint of trade, known as the "Plumbers' Trust." The
case was tried before Judge Ryan on the 25th of June,
1906, who sustained the defense under the provision of the
Anti-Trust Law above quoted, and held that the plaintiff
could not recover the price of the goods sold, even although
124
COMMENT AND AUTHORITIES.
it was shown that the price demanded was the reasonable
worth and value of the materials. As yet there has been no
decision of any appellate tribunal as to the validity of this
particular phase of anti-trust legislation.
The validity of a provision of this character has not, as
yet (July, 1906), been directly passed upon by the Supreme
Court of the United States.
The question arose, indirectly in action, under the Anti-
Trust Law of Illinois, approved June 20, 1893, containing a
similar provision to that contained in the Missouri statute,
relieving the purchaser from liability, in a suit by the trust,
to recover the purchase price of goods sold. (Connolly v. Union
Sewer Pipe Co., 184 U. S. 540.) In that case, however, the
Anti-Trust Law of Illinois was declared unconstitutional,
for the reason that, by its terms, it was made applicable to
certain persons and products, and inapplicable as to others,
namely “agricultural products, or live stock, while in the
hands of the producer or raiser." (See Connolly Case,
infra.)
It might be claimed, successfully, that such a statute de-
prives a person of his property without due process of law. The
parties may not be in pari delicto. But a suit at law is not
a proceeding in equity and it might be urged that the only
remedy for engaging in a criminal conspiracy in restraint of
trade, in addition to fine and imprisonment and possibly
confiscation, would be by injunction and dissolution of the
trust. The law may also properly provide that an injured
party may sue the trust for the injury which it has occasioned,
and may recover treble damages. The punishment by fine
and imprisonment, or by confiscation or forfeiture, is inflicted
as between the public and the offender, as the confiscation
inures to the State, as provided in section 6 of the Sherman
Act and in section 76 of the Wilson bill, which is still in
force.*
In Connolly v. Union Sewer Pipe Co., 184 U. S. 540,
above referred to, the pipe company, an Ohio corporation,
* For text of the Sherman Act and of the Wilson Bill, see Snyder's
Interstate Commerce Act, pages 298 and 305.
LIABILITY FOR GOODS PURCHASED FROM TRUST. 125
doing business in Illinois, sued Connolly, a citizen of Illinois,
to recover upon notes given by defendant to secure the pur-
chase price of pipe sold by the company to Connolly, and
also to recover the purchase price of pipe due upon open
account. The defense was that the pipe company was a
trust, and an illegal combination at common law; that it
was a trust within the purview of the Sherman Act, and
finally that it was a trust carrying on business as such in
violation of the Illinois Anti-Trust Law of June 20, 1893.
The latter act contained a provision whereby a purchaser,
sued by the trust for goods sold, might be relieved of his
purchase, and in a suit to recover for goods sold might plead
the statute as a defense to the action. The several defenses
were overruled, and plaintiff had judgment, which was
affirmed by the Supreme Court of the United States, in
184 U. S. 540. As to the Anti-Trust Law of Illinois, the
court said that as its provisions were applicable to certain
persons, and inapplicable to others, because section 9 of the
act declared that its provisions "shall not apply to agri-
cultural products, or live stock while in the hands of the
producer or raiser," the act was repugnant to the Fourteenth
Amendment, as denying to some within its jurisdiction of
"the equal protection of the laws." On this ground the
Illinois statute was held to be unconstitutional and void.
(Connolly v. Union Sewer Co., 184 U. S. 540.)
The same defer se was interposed under the Anti-Trust Law
of Missouri, Rev. Stat. Mo., 1899, §§ 8965, 8970. The
defenses as to the common law, and the Sherman Act were
overruled, on the authority of the Connolly Case, supra. As
to the Missouri Anti-Trust Act, the court held that it could
not apply to a contract for the sale of goods to be manufac-
tured by the vendor in another State (Pennsylvania), and
delivered to the vendee in Missouri, because such a contract
relates directly to interstate commerce, to which the law of
Missouri could have no application. (Hadley Dean Plate
Glass Co. v. Highland Glass Co., 143 Fed. Rep. 242.
Circuit Court of Appeals, Eighth Circuit, January 19,
1906.)
126
COMMENT AND AUTHORITIES.
A provision similar to that contained in the Missouri stat-
ute, supra, will be found in the Anti-Trust Law of Illinois
(Act of June 11, 1891), and it was held that in an action*
for goods sold the defense that the seller was a trust could
not be sustained. That the issue tendered by plaintiff in
such an action could not be met by a collateral issue, involv-
ing the question as to whether the plaintiff or seller was a
trust or combination or a member thereof, within the stat-
ute. That before such a defense could become available
there must be instituted a direct proceeding before a com-
petent tribunal, brought for the purpose of determining
whether the seller is an unlawful trust or a member of an
unlawful combination within the statute. (Lafayette Bridge
Co. v. City of Streator, 105 Fed. Rep. 729.)
X. STATE ANTI-TRUST LAWS ENUMERATED.
§ 60. State Anti-Trust Laws Enumerated. The condition
of State legislation, throughout the United States, bearing
on the subject of trusts and conspiracies in restraint of trade
and commerce, will appear by a reference to the statutes in
force January, 1906, in the various States, as follows:
Alabama.-Laws 1903, chap. 395, approved October 2d, con-
fers and limits powers of business corporations. Contains no
special anti-trust provisions. Aet approved Sept. 26, 1903, chap.
329, prohibits boycotting, picketing, and blacklisting.
Alaska.— Governed by the provisions of the Sherman Act,
approved July 2, 1890. Section 3 of the act extends its pro-
visions to the Territories and to the District of Columbia.
Arizona.— Governed by the provisions of the Sherman Act,
approved July 2, 1890. Section 3 of the act extends its pro-
visions to the Territories and to the District of Columbia.
Arkansas. Acts of March 16, 1897, and March 6, 1899.
Similar to the Georgia act. Penalty, fine and imprisonment.
Act of 1899 provides for fine only.*
66
California.- Civil Code of California, § 1673, declares that
every contract by which any one is restrained from exercising
* These penalties are in addition to penalty forfeiting charter of domestic
and banishment of foreign corporation, which are included in nearly all the
laws.
STATE ANTI-TRUST LAWS.
127
a lawful profession, trade, or business of any kind, otherwise
than as provided in the next two sections, is to that extent void."
The two sections referred to relate to transfer of partnership
and good-will, and agreements not to carry on similar business in
same city or town.
Colorado.— Governed by the rules of the common law. No
statute up to 1906.
Connecticut.— Governed by the rules of the common law.
No statute up to 1906.
Delaware. Governed by the rules of the common law. No
statute up to 1906.
District of Columbia.— Governed by provisions of the Sher-
man Act, approved July 2, 1890. Section 3 of the act extends
its provisions to the District of Columbia and the Territories.
Florida. Governed by rules of the common law, except as to
sale of Florida fed beef, or fresh meat of any edible animal
within the State. Act approved June 11, 1897, prohibits trusts
relating to sale of such beef and meats within the State. Laws
1897, chap. 4534.
Georgia. Laws 1896, chap. 122. Penalties as to individuals
include fine and imprisonment.
Idaho.- Constitution, art. 11, § 18, prohibits monopolies, and
directs Legislature to pass laws to enforce the provision with
appropriate penalties. No statute up to 1906.
Illinois. Act of June 11, 1891; June 20, 1892, and June 20,
1893; Criminal Code, §§ 269a, 269t. Relieves purchaser in suit
by the trust. Declared unconstitutional in Connolly v. Union
Sewer Pipe Co., 184 U. S. 540. See ante, page 124.
Indiana.- Act approved March 3, 1899. Laws 1899, chap.
148. Penalty may include imprisonment.
Indian Territory.- Governed by provisions of Sherman Act,
approved July 2, 1890. Section 3 of the act extends its pro-
visions to the Territories. See also act of Congress approved
Feb. 18, 1901. Became a State with Oklahoma, June 14, 1996.
May now make its own laws.
Iowa.- Act approved May 6, 1890, Code, §§ 5060, 5062.
Penalty may include fine or imprisonment, or both.
Kansas.- Act of March 8, 1897; Act of 1899, and Laws 1901,
chap. 145. Penalty under Act of 1897 is both fine and im-
prisonment. Under Act of 1899, penalty might be either. Re-
128
COMMENT AND AUTHORITIES.
lieves purchaser in suit by the trust. Validity of act sustained.
in Smiley v. Kansas, 196 U. S., see ante. § 58.
Kentucky. Constitution prohibits pooling by railroads. Sec-
tion 201 prohibits trusts and monopolies, section 198. Ken-
tucky Statutes, §§ 3915-3921. Penalty, fine or imprisonment,
or both.
Louisiana.- Constitution prohibits trusts and monopolies,
section 190. Prohibited by act approved July 7, 1892, Act 90.
Punishment, fine or imprisonment, or both.
Maine.-Laws 1904, chap. 47, §§ 53 and 55.
Maryland. Constitution declares "that monopolies are
odious, contrary to the spirit of a free government, and the
principles of commence, and ought not to be suffered." Declara-
tion of Rights, section 41. No statute up to 1906.
Massachusetts.— Governed by the rules of the common law.
No statute up to 1906.
Michigan.— Act approved June 23, 1899. Laws, chap. 255.
Penalty, fine or imprisonment, or both.
Minnesota. Acts approved April 20, 1891; April 8, 1893;
Laws 1899, chap. 359; and April 10, 1901, chap. 194. Penalty,
fine and imprisonment.
Mississippi.- Laws 1900, chap. 88, approved March 12, 1900.
Penalty, fine or imprisonment, or both.
Missouri.-Laws 1891, chap. 143; Rev. Stat. 1899, §§ 8965-
8977. Relieves purchaser in suit by the trust. See ante. § 59.
Montana. Constitution, art. 15, § 20; Penal Code, chap. 8,
§§ 321, 325.
Nebraska.
Elaborate statute, Laws 1897, chap. 79. Penalty,
fine only. Relieves purchaser in suit by the trust.
Nevada.— Governed by the rules of the common law. No
statute up to 1906.
New Hampshire.- Governed by the rules of the common law.
No statute up to 1906.
New Jersey.- Governed by the rules of the common law.
No statute up to 1906.
New Mexico.- Governed by provisions of Sherman Act, ap-
proved July 2, 1890. Section 3 of act extends its provisions to
the Territories.
STATE ANTI-TRUST LAWS.
129
New York.-Laws 1899, chap. 690, prohibits monopolies in
articles of common use and contracts in restraint of trade. See
also Penal Code, § 168.
Laws 1899, chap. 727, prohibits pools, trusts, and conspiracies
to control rates of transportation by foreign corporations and
others doing business in the State.
North Carolina.- Laws 1899, chap. 666, ratified March 8,
1899. Penalty, forfeiture of $100 per day.
North Dakota.- Revised Code of 1899, §§ 7480-7184. Vio-
lation of statute declared to be a misdemeanor.
Ohio.- Bates' Annotated Statutes, 1904, § 4427.
Oklahoma.- Governed by the Sherman Act and by the Okla-
homa statute, Laws 1893, chap. 17, § 6140. Became a State
with the Indian Territory, June 14, 1906. May now make its
own laws.
Oregon. Governed by the rules of the common law. No
statute up to 1906.
Pennsylvania.- Governed by the rules of the common law.
No statute up to 1906.
Rhode Island.- Governed by the rules of the common law.
No statute up to 1906.
South Carolina.- Act approved Feb. 26, 1902, chap. 1902,
§§ 2845, 2847. Punishment, fine and forfeiture.
South Dakota.- Revised Penal Code, 1903, §§ 770-781.
Tennessee. Acts of March 10, 1890; March 30, 1891; April
30, 1897. Penalty under last act made fine and imprisonment,
or both.
Texas. Rev. Stat. of Texas, 1895, art. 5313-5321a;
1903, chap. 94. Acts sustained Waters-Pierce Oil Co. v.
Texas, 177 U. S. 28; National Cotton Oil Co. v. Texas, 197
U. S. 115.
Utah. Prohibited by Constitution, art. 12, § 20; also by
Utah Rev. Stat., 1898, §§ 321 and 1758. Penalty, fine only.
Vermont. Governed by the rules of the common law. No
statute up to 1906.
Virginia.- Governed by the rules of the common law. No
statute up to 1906.
9
130
COMMENT AND AUTHORITIES.
Washington.- Prohibited by Constitution, art. 12, § 22,
which declares that trusts and monopolies shall never be allowed
in the State. No statute up to 1906.
West Virginia.- Governed by the rules of the common law.
No statute up to 1906.
Wisconsin-Laws 1893, chap. 219; Rev. Stat. 1898, §§ 1747,
e. f. g. 1791. Liability of trust confined to damages to injured
party and injunction to dissolve the trust.
Wyoming.— Constitution, art. 10, § 8, prohibits consolidations
or combinations to prevent competition or control prices of
products in any manner.
XI.
TELEGRAPH COMPANIES.
§ 61. As to Right of Eminent Domain-Act of July 24,
1866. Under the act of Congress, passed July 24, 1866
(U. S. Rev. Stat., § 5263 et seq.), whereby rights are con-
ferred upon telegraph companies to construct and operate
their lines through and along and over the public domain,
military or postroads and navigable waters of the United
States, no power is given to such telegraph companies to
enter upon private property without the consent of the
owner. Nor docs the statute confer upon such telegraph
companies the right of eminent domain. (Western Union
Telegraph Co. v. Pennsylvania R. R. Co., 195 U. S. 540.)
The right of way secured by a railroad company is prop-
erty devoted to public use. It is a public highway, and, as
such, is subject to State and Federal control, but such prop-
erty is deemed to be private to the extent that it can only be
taken from the railroad company by another public service
corporation, by the exercise of the right of eminent domain.
The statutes of the State of New Jersey under which the ap-
pellant claimed the right to enter upon the land embraced in
the right of way of the respondent, the Pennsylvania Rail-
road Company, did not, in terms, confer the right of eminent
domain upon the telegraph company. The right of eminent
domain cannot be delegated, and the lessee of the corpora-
tion cannot exercise the power of condemnation conferred
by the Legislature upon the lessor, nor does the Telegraph
LIABILITY UNDER SAFETY APPLIANCE LAW.
131
Act of July 24, 1866 (U. S. Rev. Stat., § 5263 et seq.),
confer the right of eminent domain upon telegraph com-
panies. (Western Union Telegraph Co. v. Pennsylvania R.
R. Co., 195 U. S. 594.)
XII. SAFETY APPLIANCE LAW.
§ 62. Safety Appliance Law-Automatic Couplers, Dif-
ferent Types-Liability of Carrier to Employee.-A rail-
road company is liable to a brakeman in its employ, who sus-
tains injury by reason of the fact that defendant's cars were
equipped with couplers which would not couple auto-
matically by impact, pursuant to the provisions of the
Safety Appliance Law of March 2, 1893.* Plaintiff was
ordered to go between the engine and dining car to performn
the service of coupling. Both cars were equipped respec-
tively with the Janney coupler and the Miller hook, auto-
matic couplers, but of different types. Because of the
difference in pattern of the couplers they would not couple
automatically by impact. The court held that the object of
the statute was to protect the lives and limbs of railroad
employees by rendering it unnecessary for a man, in order
to operate the couplers, to go between the ends of the car.
The legislative intent was to promote the public welfare and
to secure safety to employees and passengers. The risk of
coupling and uncoupling was the evil sought to be remedied,
and in this aspect the statute was remedial, while with re-
spect to recovering penalties, the statute might be construed
as penal. The design to give relief was more dominant than
to inflict punishment. (Johnson v. Southern Pacific Co.,
196 U. S. 1.)
§ 63. Safety Appliance Law - Penalties - Liability of
Carrier for Penalty.-A car loaded with coal in one State
to be delivered to a consignee in another State, is "used in
moving interstate traffic" within the meaning of the Safety
Appliance Law (Act approved March 2, 1893, chap. 196),
*For text of the Act, see Snyder's Interstate Commerce Act, page.
132
COMMENT AND AUTHORITIES.
when taken by the carrier from the place of loading, al-
though the carrier undertook to deliver it to a connecting
carrier within the same State. The words of the statute,
((
any car," means all kinds of cars running on the rails, in-
cluding locomotives. (Johnson v. Southern Pacific Co., 196
U. S. 1.) A car not equipped with couplers which will not
couple automatically by impact, is forbidden to be used by
the statute, and the use of such car is unlawful. (District
Court, southern district Illinois, March 2, 1905. United
States v. Southern Ry. Co., 135 Fed. Rep. 122.)
The court held further that the defense interposed should
be treated as similar defenses involving the question of intent
under the revenue laws, and of good faith under statutes
against handling adulterated goods, which are not tenable
in prosecutions to recover the statutory penalty. It appeared
also that the alleged inspection shown by defendant was
almost farcical, and that government inspectors found many
defective appliances in a number of cars. Defendants held
liable. (United States v. Southern Ry. Co., 135 Fed. Rep.
122.)
The case cited was brought by the United States under
section 6 of the Safety Appliance Law of March 2, 1893, to
recover a penalty of $100 imposed by the act for "each and
every violation” of the provisions of the act. The defense
interposed was that if the car had been originally equipped
with the coupling device required by law, the carrier would
not be liable for using a defective appliance if it had exer-
cised reasonable care and diligence to discover and repair
the defect before placing the car in service. The court held
that while the act was penal in its nature and must be con-
strued strictly, such construction must be given to it as will
fairly carry out the legislative intent. (Johnson v. Southern
Pacific Co., 196 U. S. 1.)
CHAPTER THREE.
::
Legislation of 1906, Relating to Interstate Commerce
Containing Text of
EMPLOYERS' LIABILITY BILL; PURE FOOD BILL; MEAT IN-
SPECTION BILL, AND HALL-MARK OR JEWELERS' LIABIL-
ITY BILL.
In addition to the amendments to the Interstate Commerce
Act, and to the Elkins Act, relating to carriers engaged in in-
terstate commerce, the first session of the Fifty-ninth Congress
enacted the Employers' Liability Bill, giving to the legal rep-
resentatives of a deceased employee, in the service of a com-
mon carrier, a cause of action against the employer for
damages for injuries resulting in the death of the employee,
through the negligence of the carrier.
Other important legislation was enacted, concerning not
only the great transportation companies operating the high-
ways of the nation, but relating to general business carried
on by individuals, firms, and corporations employing mil-
lions of capital in various enterprises, including the prepara-
tion and sale of food products, provisions, and dressed meats,
drugs, medicines, and liquors, and in the manufacture and
sale of jewelry and merchandise manufactured from gold
and silver and their alloys. The legislation with regard to
meats and provisions, drugs, and liquors affects the public
health, and the object sought is to secure pure food. The
legislation with regard to merchandise made with the pre-
cious metals was intended to make honesty compulsory as to
the true value of the articles sold, and to compel their true
134
EMPLOYERS' LIABILITY BILL.
weight and fineness to be stamped or branded thereon. The
warrant for these laws, it is claimed, is contained in the
power conferred upon Congress, under the Constitution,
to regulate commerce among the States and with foreign
nations.
This legislation is embraced in four statutes as follows:
The Employers' Liability Bill, entitled "An Act relating
to liability of common carriers in the District of Columbia
and Territories and common carriers engaged in commerce
between the States and between the States and foreign
nations to their employees." (Approved June 11, 1906.)
The Pure Food Bill, entitled "An Act for preventing the
manufacture, sale, or transportation of adulterated or mis-
branded or poisonous or deleterious foods, drugs, medicines,
and liquors, and for regulating traffic therein, and for other
purposes." (Approved June 30, 1906.)
The Meat Inspection Bill, contained in the bill making ap-
propriations for the Department of Agriculture, entitled "An
Act making appropriations for the Department of Agriculture
for the fiscal year ending June thirtieth, nineteen hundred
and seven." (Approved June 30, 1906.)
The Hall-Mark, or Jewelers' Liability Bill, entitled “An
Act forbidding the importation, exportation, or carriage in
interstate commerce of falsely or spuriously stamped arti-
cles of merchandise made of gold or silver or their alloys,
and for other purposes." (Approved June 13, 1906.)
The public health is also safeguarded by the bill extending
the powers of the national quarantine, entitled "An Act to
further protect the public health, and make more effective
the national quarantine." (Approved June 19, 1906.)
Employers' Liability Bill.—One feature of the Employers'
Liability Bill is, that it creates a new rule of evidence with
LIABILITY OF CARRIER.
135
regard to the contributory negligence of the deceased em-
ployee, in an action to recover damages by his legal repre-
sentatives. The statute, section 2, declares that "the fact
that the employee may have been guilty of contributory neg-
ligence was slight, and that of the employer was gross in
comparison, but the damages shall be diminished by the
proof in proportion to the amount of negligence attributable
to such employee." The disposition of all darnage suits,
where negligence is shown on the part of the carrier, rests
solely with the jury, and not with the court. The statute
makes questions as to negligence, and degree of contributory
negligence, questions of fact for the jury and not questions
of law for the court. The statute provides as follows:
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That
every common carrier engaged in trade or commerce in the
District of Columbia, or in any Territory of the United States,
or between the several States, or between any Territory and
another, or between any Territory or Territories and any State
or States, or the District of Columbia, or with foreign nations,
or between the District of Columbia and any State or States
or foreign nations, shall be liable to any of its employees, or,
in the case of his death, to his personal representative for the
benefit of his widow and children, if any, if none, then for his
parents, if none, then for his next of kin dependent upon him,
for all damages which may result from the negligence of any
of its officers, agents, or employees, or by reason of any de-
fect or insufficiency due to its negligence in its cars, engines,
appliances, machinery, track, roadbed, ways, or works.
Sec. 2.. Employers' Liability Act-Contributory Negli-
gence. That in all actions hereafter brought against any
common carriers to recover damages for personal injuries
to an employee, or where such injuries have resulted
in his death, the fact that the employee may have been
guilty of contributory negligence shall not bar a recovery
where his contributory negligence was slight and that of
the employer was gross in comparison, but the damages
shall be diminished by the jury in proportion to the amount
136
PURE FOOD BILL.
of negligence attributable to such employee. All questions.
of negligence and contributory negligence shall be for
the jury.
Sec. 3. Employers' Liability Act Contracts with Car-
rier No Bar. That no contract of employment, insurance,
relief benefit, or indemnity for injury or death entered into
by or on behalf of any employee, nor the acceptance of any
such insurance, relief benefit, or indemnity by the person
entitled thereto, shall constitute any bar or defense to any
action brought to recover damages for personal injuries
to or death of such employee: Provided, however, That
upon the trial of such action against any common carrier
the defendant may set off therein any sum it has con-
tributed toward any such insurance, relief benefit, or in-
demnity that may have been paid to the injured employee,
or, in case of his death, to his personal representative.
Sec. 4. Employers' Liability Act-Statute of Limita-
tions. That no action shall be maintained under this Act,
unless commenced within one year from the time the cause
of action accrued.
Sec. 5. Employers' Liability Act-Duty of Carrier under
Safety Appliance Law Not Impaired. That nothing in
this Act shall be held to limit the duty of common carriers
by railroads or impair the rights of their employees under
the safety-appliance Act of March second, eighteen hundred
and ninety-three, as amended April first, eighteen hundred
and ninety-six, and March second, nineteen hundred and
three.
Approved, June 11, 1906.
The Pure Food Bill.- The provisions of the Pure Food
Bill relates to manufacture, sale, or transportation of
adulterated or misbranded or poisonous or deleterious foods,
drugs, medicines, and liquors. The text of the statute is as
follows:
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That
it shall be unlawful for any person to manufacture within any
ADULTERATION AND MISBRANDING FORBIDDEN. 137
Territory or the District of Columbia any article of food or
drug which is adulterated or misbranded, within the meaning
of this Act; and any person who shall violate any of the pro-
visions of this section shall be guilty of a misdemeanor, and
for each offense shall, upon conviction thereof, be fined not to
exceed five hundred dollars or shall be sentenced to one year's
imprisonment, or both such fine and imprisonment, in the dis-
cretion of the court, and for each subsequent offense and con-
viction thereof shall be fined not less than one thousand dollars
or sentenced to one year's imprisonment, or both such fine and
imprisonment, in the discretion of the court.
Sec. 2. Pure Food Bill-Adulterated and Misbranded
Articles Forbidden.- That the introduction into any State
or Territory or the District of Columbia from any other State
or Territory or the District of Columbia, or from any foreign
country, or shipment to any foreign country of any article
of food or drugs which is adulterated or misbranded, within
the meaning of this Act, is hereby prohibited; and any
person who shall ship or deliver for shipment from any
State or Territory or the District of Columbia to any other
State or Territory or the District of Columbia, or to a
foreign country, or who shall receive in any State or Terri-
tory or the District of Columbia from any other State or
Territory or the District of Columbia, or foreign country,
and having so received, shall deliver, in original unbroken |
packages, for pay or otherwise, or offer to deliver to any
other person, any such article so adulterated or misbranded
within the meaning of this Act, or any person who shall
sell or offer for sale in the District of Columbia or the
Territories of the United States any such adulterated or
misbranded foods or drugs, or export or offer to export
the same to any foreign country, shall be guilty of a mis-
demeanor, and for such offense be fined not exceeding two
hundred dollars for the first offense, and upon conviction
for each subsequent offense not exceeding three hundred
dollars or be imprisoned not exceeding one year, or both,
in the discretion of the court: Provided, That no arti-
cle shall be deemed misbranded or adulterated within the
provisions of this Act when intended for export to any
foreign country and prepared or packed according to the
specifications or directions of the foreign purchaser when no
substance is used in the preparation or packing thereof
in conflict with the laws of the foreign country to which
said article is intended to be shipped; but if said article
shall be in fact sold or offered for sale for domestic use
138
PURE FOOD BILL.
or consumption, then this proviso shall not exempt said
article from the operation of any of the other provisions of
this Act.
Sec. 3. Pure Food Bill-Uniform Regulations.- That
the Secretary of the Treasury, the Secretary of Agriculture,
and the Secretary of Commerce and Labor shall make
uniform rules and regulations for carrying out the pro-
visions of this Act, including the collection and examina-
tion of specimens of foods and drugs manufactured or
offered for sale in the District of Columbia, or in any Terri-
tory of the United States, or which shall be offered for
sale in unbroken packages in any State other than that in
which they shall have been respectively manufactured or
produced, or which shall be received from any foreign
country, or intended for shipment to any foreign country,
or which may be submitted for examination by the chief
health, food, or drug officer of any State, Territory, or the
District of Columbia, or at any domestic or foreign port
through which such product is offered for interstate com-
merce, or for export or import between the United States
and any foreign port or country.
Sec. 4. Pure Food Bill Examination of Specimens.-
That the examinations of specimens of foods and drugs
shall be made in the Bureau of Chemistry of the Depart-
ment of Agriculture, or under the direction and super-
vision of such Bureau, for the purpose of determining from
such examinations whether such articles are adulterated
or misbranded within the meaning of this Act; and if it
shall appear from any such examination that any of such
specimens is adulterated or misbranded within the meaning
of this Act, the Secretary of Agriculture shall cause notice
thereof to be given to the party from whom such sample
was obtained. Any party so notified shall be given an
opportunity to be heard, under such rules and regulations
as may be prescribed as aforesaid, and if it appears that any
of the provisions of this Act have been violated by such
party, then the Secretary of Agriculture shall at once
certify the facts to the proper United States district attor-
ney, with a copy of the results of the analysis or the ex-
amination of such article duly authenticated by the analyst
or officer making such examination, under the oath of such
officer. After judgment of the court, notice shall be given
by the publication in such manner as may be prescribed
by the rules and regulations aforesaid.
DEFINITIONS
ADULTERATION.
139
Sec. 5. Pure Food Bill-Offenders How Punished.—
That it shall be the duty of each district attorney to whom
the Secretary of Agriculture shall report any violation of
this Act, or to whom any health or food or drug officer or
agent of any State, Territory, or the District of Columbia
shall present satisfactory evidence of any such violation,
to cause appropriate proceedings to be commenced and
prosecuted in the proper courts of the United States, with-
out delay, for the enforcement of the penalties as in such
case herein provided.
Sec. 6. Pure Food Bill — Definitions. That the term
drug," as used in this Act, shall include all medicines
and preparations recognized in the United States Pharma…
copia or National Formulary for internal or external use,
and any substance or mixture of substances intended to be
used for the cure, mitigation, or prevention of disease of
either man or other animals. The term "food," as used
herein, shall include all articles used for food, drink, con-
fectionery, or condiment by man or other animals, whether
simple, mixed, or compound.
Sec. 7. Pure Food Bill- Adulteration Defined. That
for the purposes of this Act an article shall be deemed to
be adulterated:
In case of drugs:
First. If, when a drug is sold under or by a name recog-
nized in the United States Pharmacopoeia or National
Formulary, it differs from the standard of strength, quality,
or purity, as determined by the test laid down in the United
States Pharmacopoeia or National Formulary official at
the time of investigation: Provided, That no drug
defined in the United States Pharmacopoeia or National
Formulary shall be deemed to be adulterated under this
provision if the standard of strength, quality, or purity be
plainly stated upon the bottle, box, or other container
thereof although the standard may differ from that deter-
mined by the test laid down in the United States Pharma-
copoia or National Formulary.
Second. If its strength or purity fall below the professed
standard or quality under which it is sold.
In the case of confectionery:
If it contain terra alba, barytes, talc, chrome yellow, or
other mineral substance or poisonous color or flavor, or
other ingredient deleterious or detrimental to health, or
A
140
PURE FOOD BILL.
any vinous, malt or spirituous liquor or compound or nar-
cotic drug.
In the case of food:
First. If any substance has been mixed and packed with
it so as to reduce or lower or injuriously affect its quality
or strength.
Second. If any substance has been substituted wholly
or in part for the article.
Third. If any valuable constituent of the article has been
wholly or in part abstracted.
Fourth. If it be mixed, colored, powdered, coated, or
stained in a manner whereby damage or inferiority is
concealed.
Fifth. If it contain any added poisonous or other added
deleterious ingredient which may render such article in-
jurious to health: Provided, That when in the preparation
of food products for shipment they are preserved by any
external application applied in such manner that the preser-
vative is necessarily removed mechanically, or by macera-
tion in water, or otherwise, and directions for the removal
of said preservative shall be printed on the covering or the
package, the provisions of this Act shall be construed as
applying only when said products are ready for consump-
tion.
Sixth. If it consists in whole or in part of a filthy, decom-
posed, or putrid animal or vegetable substance, or any
portion of an animal unfit for food, whether manufactured
or not, or if it is the product of a diseased animal, or one
that has died otherwise than by slaughter.
Sec. 8. Pure Food Bill-Term Misbranded Defined.—
That the term "misbranded," as used herein, shall apply to
all drugs, or articles of food, or articles which enter into
the composition of food, the package or label of which shall
bear any statement, design, or device regarding such article,
or the ingredients or substances contained therein which
shall be false or misleading in any particular, and to any
food or drug product which is falsely branded as to the
State, Territory, or country in which it is manufactured
or produced.
That for the purposes of this Act an article shall also be
deemed to be misbranded.
In case of drugs:
First. If it be an imitation of or offered for sale under
the name of another article.
Second. If the contents of the package as originally put
up shall have been removed, in whole or in part, and other
TERM MISBRANDED DEFINED.
141
contents shall ahve been placed in such package, or if
the package fail to bear a statement on the label of the
quantity or proportion of any alcohol, morphine, opium,
cocaine, heroin, alpha or beta eucaine, chloroform, cannabis
indica, chloral hydrate, or acetanilide, or any derivative or
preparation of any such substances contained therein.
In the case of food:
First. If it be an imitation of or offered for sale under the
distinctive name of another article.
Second. If it be labeled or branded so as to deceive or
mislead the purchaser, or purport to be a foreign product
when not so, or if the contents of the package as originally
put up shall have been removed in whole or in part and other
contents shall have been placed in such package, or if it
fail to bear a statement on the label of the quantity or pro-
portion of any morphine, opium, cocaine, heroin, alpha or
beta eucane, chloroform, cannabis indica, chloral hydrate,
or acetanilide, or any derivative or preparation of any of
such substances contained therein.
Third. If in package form, and the contents are stated in
terms of weight or measure, they are not plainly and cor-
rectly stated on the outside of the package.
Fourth. If the package containing it or its label shall
bear any statement, design, or device regarding the in-
gredients or the substances contained therein, which state-
ment, design, or device shall be false or misleading in any
particular: Provided, That an article of food which does
not contain any added poisonous or deleterious ingredients
shall not be deemed to be adulterated or misbranded in
the following cases:
First. In the case of mixtures or compounds which may
be now or from time to time hereafter known as articles
of food, under their own distinctive names, and not an imita-
tion of or offered for sale under the distinctive name of
another article, if the name be accompanied on the same
label or brand with a statement of the place where said
article has been manufactured or produced.
""
Second. In the case of articles labeled, branded, or tagged
so as to plainly indicate that they are compounds, imitations,
or blends, and the word "compound,' "imitation," or
" blend," as the case may be, is plainly stated on the package
in which it is offered for sale: Provided, That the term
blend as used herein shall be construed to mean a mixture
of like substances, not excluding harmless coloring or
flavoring ingredients used for the purpose of coloring and
flavoring only: And provided further, That nothing in
142
PURE FOOD BILL.
this Act shall be construed as requiring or compelling
proprietors or manufacturers of proprietory foods which
contain no unwholesome added ingredient to disclose their
trade formulas, except in so far as the provisions of this
Act may require to secure freedom from adulteration or
misbranding.
Sec. 9. Pure Food Bill Defense Dealer May Impose.-
That no dealer shall be prosecuted under the provisions
of this Act when he can establish a guaranty signed by the
wholesaler, jobber, manufacturer, or other party residing
in the United States, from whom he purchases such articles,
to the effect that the same is not adulterated or misbranded
within the meaning of this Act, designating it. Said guar-
anty, to afford protection, shall contain the name and
address of the party or parties making the sale of such arti-
cles to such dealer, and in such case said party or parties.
shall be amenable to the prosecutions, fines, and other
penalties which would attach, in due course, to the dealer
under the provisions of this Act.
Sec. 10. Pure Food Bill
Venue of Proceedings in Rem.
-That any article of food, drug, or liquor that is adul-
terated or misbranded within the meaning of this Act, and
is being transported from one State, Territory, District, or
insular possession to another for sale, or, having been
transported, remains unloaded, unsold, or in original un-
broken packages, or if it be sold or offered for sale in the
District of Columbia or the Territories, or insular posses-
sions of the United States, or if it be imported from a foreign
country for sale, or if it is intended for export to a foreign
country, shall be liable to be proceeded against in any dis-
trict court of the United States within the district where the
same is found, and seized for confiscation by a process of
libel for condemnation. And if such article is condemned
as being adulterated or misbranded, or of a poisonous or
deleterious character, within the meaning of this Act, the
same shall be disposed of by destruction or sale, as the said
court may direct, and the proceeds thereof, if sold, less
the legal costs and charges, shall be paid into the Treasury
of the United States, but such goods shall not be sold in
any jurisdiction contrary to the provisions of this Act or
the laws of that jurisdiction: Provided, however, That
upon the payment of the costs of such libel proceedings
and the execution and delivery of a good and sufficient bond
to the effect that such articles shall not be sold or other-
SAMPLES FOR EXPORT
CONFISCATION.
143
wise disposed of contrary to the provisions of this Act, or
the laws of any State, Territory, District, or insular pos-
session, the court may by order direct that such articles
be delivered to the owner thereof. The procedings of
such libel cases shall conform, as near as may be, to the
proceedings in admiralty, except that either party may
demand trial by jury of any issue of fact joined in any
such case, and all such proceedings shall be at the suit of
and in the name of the United States.
Sec. 11. Pure Food Bill-Samples of Imports Con-
fiscation. The Secretary of the Treasury shall deliver to
the Secretary of Agriculture, upon his request from time
to time, samples of foods and drugs which are being im-
ported into the United States or offered for import, giving
notice thereof to the owner or consignee, who may appear
before the Secretary of Agriculture, and have the right
to introduce testimony, and if it appear from the examina-
tion of such samples that any article of food or drug offered
to be imported into the United States is adulterated or
misbranded within the meaning of this Act, or is otherwise
dangerous to the health of the people of the United States,
or is of a kind forbidden entry into, or forbidden to be sold
or restricted in sale in the country in which it is made
or from which it is exported, or is otherwise falsely labeled
in any respect, the said article shall be refused admission,
and the Secretary of the Treasury shall refuse delivery to
the consignee and shall cause the destruction of any goods
refused delivery which shall not be exported by the con-
signee within three months from the date of notice of such
refusal under such regulations as the Secretary of the
Treasury may prescribe: Provided, That the Secretary of
the Treasury may deliver to the consignee such goods
pending examination and decision in the matter on execu-
tion of a penal bond for the amount of the full invoice
value of such goods, together with duty thereon, and on
refusal to return such goods for any cause to the custody ·
of the Secretary of the Treasury, when demanded, for the
purpose of excluding them from the country, or for any other
purpose, said consignee shall forfeit the full amount of
the bond: And provided further, That all charges for
storage, cartage. and labor on goods which are refused
admission or delivery shall be paid by the owner or con-
signee, and in default of such payment shall constitute a
lien against any future importation made by such owner
or consignee.
144
MEAT INSPECTION BILL.
""
Sec. 12. Pure Food Bill- Definitions - Construction of
Act.— That the term "Territory" as used in this Act shall
include the insular possessions of the United States. The
word." person
as used in this Act shall be construed to
import both the plural and the singular, as the case de-
mands, and shall include corporations, companies, societies.
and associations. When construing and enforcing the pro-
visions of this Act, the act, omission, or failure of any
officer, agent, or other person acting for or employed by
any corporation, company, society, or association, within.
the scope of his employment or office, shall in every case
be also deemed to be the act, omission, or failure of such
corporation, company, society, or association as well as
that of the person.
Sec. 13. Pure Food Bill - When Act takes Effect. That
this Act shall be in force and effect from and after the first
day of January, nineteen hundred and seven.
Approved June 30, 1906.
Meat Inspection Bill. As a supplement to the legislation
embraced in the Pure Food Bill, and in order to secure the
inspection of dressed meats and meat food products, in order
to prevent the use in interstate commerce, of such articles
which are unsound, unhealthful, unwholesome or otherwise
unfit for human food, the Agricultural Appropriation Bill for
the fiscal year ending June 30, 1907, approved June 30, 1906,
contains the following provisions in the part of the bill re-
lating to the Bureau of Animal Industry:
Secretary of Agriculture May Appoint Inspectors.— That
for the purpose of preventing the use in interstate or foreign
commerce, as hereinafter provided, of meat and meat food
products which are unsound, unhealthful, unwholesome, or
otherwise unfit for human food, the Secretary of Agricul-
ture, at his discretion, may cause to be made, by inspectors
appointed for that purpose, an examination and inspection
of all cattle, sheep, swine, and goats before they shall be al-
lowed to enter into any slaughtering, packing, meat-canning,
rendering, or similar establishment, in which they are to
be slaughtered and the meat and meat food products thereof
are to be used in interstate or foreign commerce; and all
cattle, swine, sheep, and goats found on such inspection to
show symptoms of disease shall be set apart and slaughtered
DUTY OF INSPECTORS.
145
separately from all other cattle, sheep, swine, or goats, and
when so slaughtered the carcasses of said cattle, sheep,
swine, or goats shall be subject to a careful examination and
inspection, all as provided by the rules and regulations to
be prescribed by the Secretary of Agriculture as herein pro-
vided for.
Duty of Inspectors. That for the purposes hereinbefore
set forth the Secretary of Agriculture shall cause to be made
by inspectors appointed for that purpose, as hereinafer pro-
vided, a post-mortem examination and inspection of the car-
casses and parts thereof of all cattle, sheep, swine, and goats
to be prepared for human consumption at any slaughtering,
meat-canning, salting, packing, rendering, or similar esta-
blishment in any State, Territory, or the District of Colum-
bia for transportation or sale as articles of interstate or
foreign commerce; and the carcasses and parts thereof of all
such animals found to be sound, healthful, wholesome, and
fit for human food shall be marked, stamped, tagged, or
labeled as "Inspected and passed;" and said inspectors shall
label, mark, stamp, or tag as "Inspected and condemned," all
carcasses and parts thereof of animals found to be unsound,
unhealthful, unwholesome, or otherwise unfit for human
food; and all carcasses and parts thereof thus inspected and
condemned shall be destroyed for food purposes by the said
establishment in the presence of an inspector, and the Secre-
tary of Agriculture may remove inspectors from any such
establishment which fails to so destroy any such condemned
carcass or part thereof, and said inspectors, after said first
inspection shall, when they deem it necessary, reinspect said
carcasses or parts thereof to determine whether since the first
inspection the same have become unsound, unhealthful, un-
wholesome, or in any way unfit for human food, and if any
carcass or any part thereof shall, upon examination and in-
spection subsequent to the first examination and inspection,
be found to be unsound, unhealthful, unwholesome, or other-
wise unfit for human food, it shall be destroyed for food
purposes by the said establishment in the presence of an in-
spector, and the Secretary of Agriculture may remove in-
spectors from any establishment which fails to so destroy
any such condemned carcass or part thereof.
The foreging provisions shall apply to all carcasses or
parts of carcasses of cattle, sheep, swine, and goats, or the
meat or meat products thereof which may be brought into
any slaughtering, meat-canning, salting, packing, rendering,
or similar establishment, and such examination and inspec-
V
146
MEAT INSPECTION BILL.
tion shall be had before the said carcasses or parts thereof
shall be allowed to enter into any department wherein the
same are to be treated and prepared for meat food products;
and the foregoing provisions shall also apply to all such pro-
ducts which, after having been issued from any slaughter-
ing, meat-canning, salting, packing, rendering, or similar
establishment, shall be returned to the same or to any
similar establishment where such inspection is maintained.
Access to Establishments.- Marks, Tags, Stamps, and
Labels. That for the purposes hereinbefore set forth the
Secretary of Agriculture shall cause to be made by in-
spectors appointed for that purpose an examination and
inspection of all meat food products prepared for interestate
or foreign commerce in any slaughtering, meat-canning, salt-
ing, packing, rendering, or similar establishment, and for the
purposes of any examination and inspection said inspectors
shall have access at all times, by day or night, whether the
establishment be operated or not, to every part of said.
establishment; and said inspectors shall mark, stamp, tag,
or label as "Inspected and passed" all such products found
to be sound, healthful, and wholesome, and which contain
no dyes, chemicals, preservatives, or ingredients which ren-
der such meat or meat food products unsound, unhealthful,
unwholesome, or unfit for human food; and said inspectors
shall label, mark, stamp, or tag as "Inspected and con-
demned" all such products found unsound, unhealthful, and
unwholesome, or which contain dyes, chemicals, preserva-
tives, or ingredients which render such meat or meat food
products unsound, unhealthful, unwholesome, or unfit for
human food, and all such condemned meat food products
shall be destroyed for food purposes, as hereinbefore pro-
vided, and the Secretary of Agriculture may remove in-
spectors from any establishment which fails to so destroy
such condemned meat food products: Provided, That, sub-
ject to the rules and regulations of the Secretary of Agri-
culture, the provisions hereof in regard to preservatives
shall not apply to meat food products for export to any
foreign country and which are prepared or packed accord-
ing to the specifications or directions of the foreign pur-
chaser, when no substance is used in the preparation or
packing thereof in conflict with the laws of the foreign coun-
try to which said article is to be exported; but if said article
shall be in fact sold or offered for sale for domestic use or
consumption then this proviso shall not exempt said article
from the operation of all the other provisions of this Act.
LABELS
EXPERT INSPECTORS.
147
Label to be Attached.- That when any meat or meat
food product prepared for interstate or foreign commerce
which has been inspected as hereinbefore provided and
marked “Inspected and passed" shall be placed or packed
in any can, pot, tin, canvas, or other receptacle or covering
in any establishment where inspection under the provisions
of this Act is maintained, the person, firm, or corporation
preparing said product shall cause a label to be attached to
said can, pot, tin, canvas, or other receptacle or covering,
under the supervision of an inspector, which label shall state
that the contents thereof have been " Inspected and passed"
under the provisions of this Act; and no inspection and ex-
amination of meat or meat food products deposited or in-
closed in cans, tins, pots, canvas, or other receptacle or cov-
ering in any establishment where inspection under the pro-
visions of this Act is maintained shall be deemed to be com-
plete until such meat or meat food products have been
sealed or inclosed in said can, tin, pot, canvas, or other
receptacle or covering under the supervision of an inspector,
and no such meat or meat food products shall be sold or
offered for sale by any person, firm, or corporation in inter-
state or foreign commerce under any false or deceptive
name; but established trade name or names which are
usual to such products and which are not false and deceptive
and which shall be approved by the Secretary of Agriculture
are permitted.
Experts in Sanitation - Packing Establishments.— The
Secretary of Agriculture shall cause to be made, by experts
in sanitation or by other competent inspectors, such inspec-
tion of all slaughtering, meat canning, salting, packing, ren-
dering, or similar establishments in which cattle, sheep,
swine, and goats are slaughtered and the meat and meat
food products thereof are prepared for interstate or foreign
commerce as may be necessary to inform himself concerning
the sanitary conditions of the same, and to prescribe the
rules and regulations of sanitation under which such esta-
blishments shall be maintained; and where the sanitary con-
ditions of any such establishment are such that the meat or
meat food products are rendered unclean, unsound, un-
healthful, unwholesome, or otherwise unfit for human food,
he shall refuse to allow said meat or meat food products to
be labeled, marked, stamped, or tagged as "inspected and
passed."
That the Secretary of Agriculture shall cause an examina-
tion and inspection of all cattle, sheep, swine, and goats,
148
MEAT INSPECTION BILL.
and the food products thereof, slaughtered and prepared in
the establishments hereinbefore described for the purposes
of interstate or foreign commerce to be made during the
nighttime as well as during the daytime when the slaughter-
ing of said cattle, sheep, swine, and goats, or the preparation
of said food products is conducted during the nighttime.
Uninspected Meat Foods Prohibited. That on and after
October first, nineteen hundred and six, no person, firm, or
corporation shall transport or offer for transportation, and
no carrier of interstate or foreign commerce shall transport
or receive for transportation from one State or Territory or
the District of Columbia to any other State or Territory or
the District of Columbia, or to any place under the jurisdic-
tion of the United States, or to any foreign country, any car-
casses or parts thereof, meat, or meat food products thereof
which have not been inspected, examined, and marked as
"inspected and passed," in accordance with the terms of this
Act and with the rules and regulations prescribed by the
Secretary of Agriculture: Provided, That all meat and meat
food products on hand on October first, nineteen hundred
and six, at establishments where inspection has not been
maintained, or which have been inspected under existing
law, shall be examined and labeled under such rules and
regulations as the Secretary of Agricluture shall prescribe,
and then shall be allowed to be sold in interstate or foreign
commerce.
Forged or Counterfeit Labels Prohibited. That no per-
son, firm, or corporation, or officer, agent, or employee there-
of, shall forge, counterfeit, simulate, or falsely represent, or
shall without proper authority use, fail to use, or detach, or
shall knowingly or wrongfully alter, deface, or destroy, or
fail to deface or destroy, any of the marks, stamps, tags,
labels, or other identification devices provided for in this
Act, or in and as directed by the rules and regulations pre-
scribed hereunder by the Secretary of Agriculture, on any
carcasses, parts of carcasses, or the food product, or con-
tainers thereof, subject to the provisions of this Act, or any
certificate in relation thereto, authorized or required by this
Act or by the said rules and regulations of the Secretary of
Agriculture.
Inspection of Animals and Carcasses for Export.- That
the Secretary of Agriculture shall cause to be made a careful
inspection of all cattle, sheep, swine, and goats intended and
offered for export to foreign countries at such times and
INSPECTION FOR EXPORT.
149
places, and in such manner as he may deem proper, to
ascertain whether such cattle, sheep, swine, and goats are
free from disease.
And for this purpose he may appoint inspectors who shall
be authorized to give an official certificate clearly stating the
condition in which such cattle, sheep, swine, and goats are
found.
And no clearance shall be given to any vessel having on
board cattle, sheep, swine, or goats for export to a foreign
country until the owner or shipper of such cattle, sheep,
swine, or goats has a certificate from the inspector herein
authorized to be appointed, stating that the said cattle,
sheep, swine, or goats are sound and healthy, or unless the
Secretary of Agriculture shall have waived the requirement
of such certificate for export to the particular country to
which such cattle, sheep, swine, or goats are to be exported.
That the Secretary of Agriculture shall also cause to be
made a careful inspection of the carcasses and parts thereof
of all cattle, sheep, swine, and goats, the meat of which,
fresh, salted, canned, corned, packed, cured, or otherwise
prepared, is intended and offered for export to any foreign
country, at such times and places and in such manner as he
may deem proper.
And for this purpose he may appoint inspectors who shall
be authorized to give an official certificate stating the condi-
tion in which said cattle, sheep, swine, or goats, and the
meat thereof, are found.
And no clearance shall be given to any vessel having on
board any fresh, salted, canned, corned, or packed beef,
mutton, pork, or goat meat, being the meat of animals killed.
after the passage of this Act, or except as hereinbefore pro-
vided for export to and sale in a foreign country from any
port in the United States, until the owner or shipper thereof
shall obtain from an inspector appointed under the pro-
visions of this Act a certificate that the said cattle, sheep,
swine, and goats were sound and healthy at the time of in-
spection, and that their meat is sound and wholesome, un-
less the Secretary of Agriculture shall have waived the re-
quirements of such certificate for the country to which said
cattle, sheep, swine, and goats or meats are to be exported.
Certificates of Inspection for Shipper.- That the in-
spectors provided for herein shall be authorized to give
official certificates of the sound and wholesome condition of
the cattle, sheep, swine, and goats, their carcasses and pro-
ducts as herein described, and one copy of every certificate
150
MEAT INSPECTION BILL.
granted under the provisions of this Act shall be filed in the
Department of Agriculture, another copy shall be delivered
to the owner or shipper, and when the cattle, sheep, swine,
and goats or their carcasses and products are sent abroad,
a third copy shall be delivered to the chief officer of the
vessel on which the shipment shall be made.
Compliance With Law Compulsory - Penalties. That
no person, firm, or corporation engaged in the interstate
commerce of meat or meat food products shall transport or
offer for transportation, sell or offer to sell any such meat or
meat food products in any State or Territory or in the Dis-
trict of Columbia or any place under the jurisdiction of the
United States, other than in the State or Territory or in the
District of Columbia or any place under the jurisdiction of
the United States in which the slaughtering, packing, can-
ning, rendering, or other similar establishment owned,
leased, operated by said firm, person, or corporation is lo-
cated unless and until said person, firm, or corporation shall
have complied with all of the provisions of this Act.
That any person, firm, or corporation, or any officer or
agent of any such person, firm, or corporation, who shall
violate any of the provisions of this Act shall be deemed
guilty of a misdemeanor and shall be punished on conviction
thereof by a fine of not exceeding ten thousand dollars or
imprisonment for a period not more than two years, or by
both such fine and imprisonment, in the discretion of the
court.
When Label Shall Be Refused. That the Secretary
of Agriculture shall appoint from time to time inspectors to
make examination and inspection of all cattle, sheep, swine,
and goats, the inspection of which is hereby provided for,
and of all carcasses and parts thereof, and of all meats and
meat food products thereof, and of the sanitary conditions of
all establishments in which such meat and meat food pro-
ducts hereinbefore described are prepared; and said in-
spectors shall refuse to stamp, mark, tag, or label any car-
cass or any part thereof, or meat food product therefrom,
prepared in any establishment hereinbefore mentioned, until
the same shall have actually been inspected and found to be
sound, healthful, wholesome, and fit for human food, and to
contain no dyes, chemicals, preservatives, or ingredients
which render such meat food product unsound, unhealthful,
unwholesome, or unfit for human. food; and to have been
prepared under proper sanitary conditions, hereinbefore pro-
BRIBERY OF OFFICER A FELONY.
151
vided for; and shall perform such other duties as are pro-
vided by this Act and by the rules and regulations to be
prescribed by said Secretary of Agriculture; and said Secre-
tary of Agriculture shall, from time to time, make such rules
and regulations as are necessary for the efficient execution
of the provisions of this Act, and all inspections and exam-
inations made under this Act shall be such and made in such
manner as described in the rules and regulations prescribed
by said Secretary of Agriculture not inconsistent with the
provisions of this Act.
Bribery of Inspector a Felony.-That any person, firm,
or corporation, or any agent or employee of any person, firm,
or corporation who shall give, pay, or offer, directly or indi-
rectly, to any inspector, deputy inspector, chief inspector, or
any other officer or employee of the United States authorized
to perform any of the duties prescribed by this Act or by the
rules and regulations of the Secretary of Agriculture any
money or other thing of value, with intent to influence said
inspector, deputy inspector, chief inspector, or other officer
or employee of the United States in the discharge of any
duty herein provided for, shall be deemed guilty of a felony
and, upon conviction thereof, shall be punished by a fine not
less than five thousand dollars nor more than ten thousand
dollars and by imprisonment not less than one year nor more
than three years; and any inspector, deputy inspector, chief
inspector, or other officer or employee of the United States
authorized to perform any of the duties prescribed by this
Act who shall accept any money, gift, or other thing of value
from any person, firm, or corporation, or officers, agents, or
employees thereof, given with intent to influence his official
action, or who shall receive or accept from any person, firm,
or corporation engaged in interstate or foreign commerce
any gift, money, or other thing of value given with any
purpose or intent whatsoever, shall be deemed guilty of a
felony and shall, upon conviction thereof, be summarily dis-
charged from office and shall be punished by a fine not less
than one thousand dollars nor more than ten thousand dol-
lars and by imprisonment not less than one year nor more
than three years.
Animals Slaughtered by Farmer on Farm.- That the pro-
visions of this Act requiring inspection to be made by
the Secretary of Agriculture shall not apply to animals
slaughtered by any farmer on the farm and sold and trans-
ported as interstate or foreign commerce, nor to retail butch-
ers and retail dealers in meat and meat food products,
152
JEWELERS' LIABILITY BILL.
supplying their customers: Provided, That if any person shall
shall sell or offer for sale or transportation for interstate or
foreign commerce any meat or meat food products which are
diseased, unsound, unhealthful, unwholesome, or otherwise
unfit for human food, knowing that such meat food products
are intended for human consumption, he shall be guilty of a
misdemeanor, and on conviction thereof shall be punished
by a fine not exceeding one thousand dollars or by imprison-
ment for a period of not exceeding one year, or by both such
fine and imprisonment: Provided also, That the Secretary
of Agriculture is authorized to maintain the inspection in
this Act provided for at any slaughtering, meat canning,
salting, packing, rendering, or similar establishment not-
withstanding this exception, and that the persons operating
the same may be retail butchers and retail dealers or
farmers; and where the Secretary of Agriculture shall
establish such inspection then the provisions of this Act
shall apply notwithstanding this exception.
Permanent Appropriation $3,000,000.- That there is per-
manently appropriated, out of any money in the Treasury
not otherwise appropriated, the sum of three million dollars,
for the expenses of the inspection of cattle, sheep, swine,
and goats and the meat and meat food products thereof
which enter into interstate or foreign commerce and for all
expenses necessary to carry into effect the provisions of this
Act relating to meat inspection, including rent and the em-
ployment of labor in Washington and elsewhere, for each
year. And the Secretary of Agriculture shall, in his annual
estimates made to Congress, submit a statement in detail,
showing the number of persons employed in such in-
spections and the salary or per diem paid to each, together
with the contingent expenses of such inspectors and where
they have been and are employed.
Total, Bureau of Animal Industry, three million nine
hundred and forty-six thousand nine hundred and eighty
dollars.
Approved June 30, 1906.
Hall-Mark, or Jewelers' Liability Bill.-The sale of falsely
or spuriously stamped merchandise, made of gold and silver
or their alloys is forbidden and prohibited, on and after
June 14, 1907, by the provisions of an act approved June
13, 1906, and the importation, exportation, or carriage in
STANDARD FOR GOLD.
153
interstate commerce of such spuriously stamped merchan-
dise is punishable as a misdemeanor, by fine or imprison-
ment, or by both fine and imprisonment. The text of the
statute is as follows:
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That
it shall be unlawful for any person, firm, corporation, or
association, being a manufacturer of or wholesale or retail
dealer in gold or silver jewelry or gold ware, silver goods
or silverware, or for any officer, manager, director, or agent
of such firm, corporation, or association to import or export
or cause to be imported into or exported from the United
States for the purpose of selling or disposing of the same,
or to deposit or cause to be deposited in the United States
mails for transmission thereby, or to deliver or cause to be
delivered to any common carrier for transportation from one
State, Territory, or possession of the United States, or the
District of Columbia, to any other State, Territory, or pos-
session of the United States, or to said District, in inter-
state commerce, or to transport or cause to be transported
from one State, Territory, or possession of the United States,
or from the District of Columbia, to any other State, Terri-
tory, or possession of the United States, or to said District,
in interstate commerce, any article of merchandise manu-
factured after the date when this Act takes effect and made
in whole or in part of gold or silver, or any alloy of either of
said metals, and having stamped, branded, engraved, or
printed thereon, or upon any tag, card, or label attached
thereto, or upon any box, package, cover, or wrapper in
which said article is incased or inclosed, any mark or word
indicating or designed or intended to indicate that the gold
or silver or alloy of either of said metals in such article is of
a greater degree of fineness than the actual fineness or
quality of such gold, silver, or alloy, according to the
standards and subject to the qualifications set forth in sec-
tions two and three of this Act.
Sec. 2. Jewelers' Liability Bill-Gold-Standard of
Weight and Fineness. That in the case of articles of mer-
chandise made in whole or in part of gold or of any of its
alloys so imported into or exported from the United States,
or so deposited in the United States mails for transmission,
or so delivered for transportation to any common carrier,
or so transported or caused to be transported as specified
in the first section of this Act, the actual fineness of such
154
JEWELERS' LIABILITY Bill.
gold or alloy shall not be less by more than one-half of one
carat than the fineness indicated by the mark stamped,
branded, engraved, or printed upon any part of such article,
or upon any tag, card, or label attached thereto, or upon any
box, package, cover, or wrapper in which such article is
incased or inclosed; except that in the case of watch cases
and flat ware, so made of gold or of any of its alloys, the
actual fineness of such gold or alloy shall not be less by
more than three one-thousandth parts than the fineness in-
dicated by the mark stamped, branded, engraved, or printed
upon such article, or upon any tag, card, or label attached
thereto, or upon any box, package, cover, or wrapper in
which such article is incased or inclosed: Provided, That in
any test for the ascertainment of the fineness of any article
mentioned in this section, according to the foregoing stand-
ards, the part of the article taken for the test, analysis, or
assay shall be such part or portion as does not contain or
have attached thereto any solder or alloy of inferior fineness
used for brazing or uniting the parts of said article: Pro-
vided, further, That in the case of any article mentioned in
this section, in addition to the foregoing tests and standards,
the actual fineness of the entire quantity of gold or of its
alloys contained in such article, including all solder and
alloy of inferior fineness used for brazing or uniting the
parts of such article (all such gold, alloys, and solder being
assayed as one piece), shall not be less by more than one
carat than the fineness indicated by the mark stamped,
branded, engraved, or imprinted upon such article, or upon
any tag, card, or label attached thereto, or upon any box,
package, cover, or wrapper in which such article is incased
or inclosed, it being intended that the standards of fineness
and the tests or methods for ascertaining the same provided
in this section for articles mentioned therein shall be con-
current and not alternative.
Sec. 3. Jewelers' Liability Bill- Silver-Standard of
Weight and Fineness. That in case of articles of mer-
chandise made in whole or in part of silver or any of its
alloys so imported into or exported from the United States,
or so deposited in the United States mails for transmission,
or so delivered for transportation to any common carrier, or
so transported or caused to be transported as specified in
the first section of this Act, the actual fineness of the silver
or alloy thereof of which such article is wholly or partly
composed shall not be less by more than four one-
thousandth parts than the actual fineness indicated by any
STANDARD FOR SILVER.
155
66
""
(6
mark (other than the word "sterling" or the word "coin ")
stamped, branded, engraved, or printed upon any part of
such article, or upon any tag, card, or label attached thereto,
or upon any box, package, cover, or wrapper in which such
article is incased or inclosed; and that no such article or
tag, card, or label attached thereto, or box, package, cover,
or wrapper in which such article is incased or inclosed shall
be marked, stamped, branded, engraved, or printed with the
word "sterling" or "sterling silver" or any colorable imita-
tion thereof, unless such article or parts thereof purporting
to be silver contains nine hundred and twenty-five one-
thousandth parts pure silver; that no such article, tag, card,
label, box, package, cover, or wrapper shall be marked,
stamped, branded, engraved, or printed with the words
coin" or “coin silver" or colorable imitation thereof un-
less such articles or parts thereof purporting to be silver
contains nine hundred one-thousandth parts pure silver:
Provided, That in the case of all such articles whose fineness is
indicated by the word sterling or the word coin "
there shall be allowed a divergence in the fineness of four
one-thousandth parts from the foregoing standards: Pro-
vided, That in any test for the ascertainment of the fine-
ness of any such article mentioned in this section according
to the foregoing standards the part of the article taken for
the test, analysis, or assay shall be such part or portion as
does not contain or have attached thereto any solder or
alloy of inferior fineness used for brazing or uniting the
parts of such article: Provided further, That in the case
of any article mentioned in this section, in addition to the
foregoing tests and standards, the actual fineness of the
entire quantity of silver or of its alloys contained in such
article, including all solder and alloy of inferior fineness
used for brazing or uniting the parts of such article (all
such silver, alloys, and solder being assayed as one piece),
shall not be less by more than ten one-thousandth parts than
the fineness indicated by the marked, stamped, branded,
engraved, or imprinted upon such article, or upon any tag,
card, or label attached thereto, or upon any box, package,
cover, or wrapper in which such article is incased or in-
closed, it being intended that the standards of fineness and
the tests or methods for ascertaining the same provided in
this section for articles mentioned therein shall be concur-
rent and not alternative.
Sec. 4. Jewelers' Liability Bill-Articles Plated With
Gold or Silver.-- That in the case of articles of merchandise
156
JEWELERS' LIABILITY BILL.
made in whole or in part of an inferior metal, having de-
posited or plated thereon or brazed or otherwise affixed
thereto a plating, covering, or sheet composed of gold or
silver, or of an alloy of either of said metals, and known in
the market as rolled gold plate, gold plate, gold filled, silver
plate, or gold or silver electroplate, or by any similar desig-
nation, so imported into or exported from the United States,
or so deposited in the United States mails for transmission,
or so delivered to any common carrier, or so transported
or caused to be transported as specified in the first section
of this Act, no such article, nor any tag, card, or label
attached thereto, nor any box, package, cover, or wrapper in
which such article is incased or inclosed, shall be stamped,
branded, engraved, or imprinted with any word or mark
usually employed to indicate the fineness of gold, unless
such word or mark be accompanied by other words plainly
indicating that such article or part thereof is made of
rolled gold plate, gold plate, or gold electroplate, or is gold
filled, as the case may be, and no such article, nor any tag,
card, or label attached thereto, nor any box, package, cover,
or wrapper in which such article is incased or inclosed, shall
be stamped, branded, engraved, or imprinted with the word
sterling or the word " coin," either alone or in conjunc-
tion with other words or marks.
""
Sec. 5 Jewelers' Liability Bill-Penalty for Violation.
―That each and every person, firm, corporation, or associa-
tion, being a manufacturer of or a wholesale or retail
dealer in gold or silver jewelry, gold ware, silver goods, or
silverware, who or which shall knowingly violate any of
the provisions of this Act, and every officer, manager,
director, or managing agent of any such corporation or asso-
ciation having knowledge of such violation and directly
participating in such violation or consenting thereto, shall
be deemed guilty of a misdemeanor, and upon conviction
thereof in any court of the United States having jurisdiction
of crimes within the district in which such violation was
committed or through which has been conducted the trans-
portation of the article in respect to which such violation
has been committed, shall be punished by a fine of not more
than five hundred dollars or imprisonment for not more than
three months, or both, at the discretion of the court. When-
ever the offense is begun in one jurisdiction and completed
in another it may be dealt with, inquired of, tried, deter-
mined, and punished in either jurisdiction in the same
manner as if the offense had been actually and wholly
committed therein.
APPLICATION OF STATE LAWS.
157
"
Sec. 6. Jewelers' Liability Bill" Article of Merchandise
Defined." That the expression "article of merchandise
as used in this Act shall signify any goods, wares, works
of art, commodity, or other thing which may be lawfully
kept or offered for sale.
Sec. 7. Jewelers' Liability Bill - When State Law Ap-
plies. That all articles of merchandise to which this Act
applies which shall have been transported into any State,
Territory, District, or possession of the United States, and
shall remain therein for use, sale, or storage, shall, upon
arrival in such State, Territory, District, or possession, be
subject to the operation of all the laws of such State, Terri-
tory, District, or possession of the United States to the same
exent and in the same manner as though such articles of
merchandise had been produced in such State, Territory,
District, or possession, and shall not be exempt therefrom
by reason of being introduced therein in original packages
or otherwise.
Sec. 8. Jewelers' Liability Bill — When Act Takes Effect.
That this Act shall take effect one year after the date of its
passage.
Approved, June 13, 1906.
INDEX.
[Supplement to Snyder's Interstate, etc.]
Action, by attorney-general to recover rebates
PAGE.
13
•
123
pending in State court, when no bar under Sherman Act, § 41. 100
when Anti-Trust Law may be pleaded as defense to, § 59.
as to assignment of cause of, § 40c
Acceptance of concurrence in joint rates required
Access to packing-houses at all times
·
Accidents, and causes thereof must be given
Accounts, carrier must have one set of
commission to have access to
of common carrier must be uniform
penalty for failure to keep
Acts of Congress cited and referred to:
•
·
•
97, 98
Y
146
31
33
32
32
32, 33
1789, Sept. 24. Judiciary Act (Jurisdiction), § 9, as amended.
1875, March 3. Judiciary Act (as to Removal of Causes)....
1886, June 29. Trades Unions Act (Carriers)
1887, Feb. 4. Interstate Commerce Act, as amended June
29, 1906
•
•
1888, Aug. 13. Judiciary Act (as to Removal of Causes)...
1888, Aug. 13. Judiciary Act (as to Assigned Claims)
82
81
113
1-37
81
98
•
1890, July
1890, Aug.
1893, Feb.
2. Sherman Act (as to Trusts)
8. Wilson Act (Liquors), §§ 3, 4.
11. Relating to Testimony
•
1893, Feb.
85
42, 43
46
1903, Feb.
1903, Feb.
1903, Feb.
1906, June
13. Harter Act (Carriers by Water)
•
1894, Aug. 27. Wilson Bill (Income Tax)
1898, June 1. Carriers' Employers Arbitration Act
1901, March 3. Requiring Reports of Accidents
1903, Feb. 11. Expediting Act
•
14. Commerce and Labor Act
19. Elkins Act, § 1, as amended, June 29, 1906..
25. Appropriation Bill for 1904 (Relating to Evi-
dence)
11. Employers' Liability Bill
xvi, xvii
124
113
32
•
27-85
46
19
46,
85
46
134
•
1906, June 13. Hall-Mark, or Jewelers' Liability Bill
134
160
INDEX.
Acts of Congress
(Continued):
1906, June 19. Quarantine Bill.
1906, June 28. Anti-Immunity Act
•
1906, June 29. Rate Bill (amending Interstate Commerce
Act)
1906, June 30. Meat Inspection Bill
1906, June 30. Pure Food Bill
U. S. Rev. Stat., § 629
U. S. Rev. Stat., §
711
U. S. Rev. Stat., §
720
U. S. Rev. Stat., § 721
U. S. Rev. Stat., § 5440
Admiralty, proceedings under Pure Food Bill to conform to.
Adulteration, of food, etc., forbidden
of food, how punished
Agents, and examiners may be appointed by Commission
of carrier, when liable to imprisonment
principal liable for acts of
Agreements, must be filed by carrier with Commission
Agriculture, secretary of, to make rules
secretary of, may appoint meat inspectors
Alabama, anti-trust laws of, § 60
Alaska, governed by provisions of Sherman Act, § 60.
Alternative Remedy, when shipper must elect
•
to be imported and exported ...
Animals, may be inspected and condemned
Annual Reports of carrier must be uniform
of Interstate Commerce Commission, how made
See also REPORTS; CARRIER.
PAGE.
134
46
1-37
134
136-144
98
82, 83
•
114
116, 117
71
143
137
139
32
10, 11
144
9
138
144, 145
126
126
14
145
148, 149
30-33
35
Anti-Trust Laws of the several states, § 55
115
Appeal from order directly to Supreme Court
from order of Commission to have priority
•
from interlocutory decree, continuing injunction only to Su-
preme Court
•
directly to the Supreme Court, § 32
26, 27
26, 27
28
85
Appraisal of railroad property, power as to
xxix
Appropriation for enforcement of Meat Inspection Bill
152
Arizona, governed by provisions of the Sherman Act, § 60.
126
•
Arkansas, Anti-Trust Laws of, § 60
•
126
Assignment of claims, jurisdiction of Federal courts, § 40c
Attorney Fee, may be recovered against carrier
97
•
14
INDEX.
161
Attorney-General directed to prosecute crime of rebating
must direct District Attorney to prosecute forfeitures.
may apply for mandamus, when
PAGE.
13
•
25, 26
33, 34
Beef Trust, an unlawful conspiracy under Sherman Act, § 46..... 103
Bill of Lading, made compulsory
now compulsory
not to contain exemption clauses
under Harter Act
Blacklist, prohibited under Sherman Act, § 52
•
of employees by carrier, when prohibited, § 54a
Blackstone, Sir William, on power of visitation.
Blends, to be indicated by label...
Books, production of, compulsory
of common carrier must be uniform
false entries in, a misdemeanor
of carrier must be uniform
•
•
Book Trust, when void under Sherman Act, § 52
owning copyright, when cannot control sale, § 53
Boycott, conspiracy to, restrained by injunction, § 54
Breaking Bulk, when prohibited by carrier
Bribery, of meat inspector, a felony
•
34
xiv
xiv
xvi
108
113
•
·
XXV
·
•
141
18
32
33
xxvii
108
110
111
•
13
151
94
95
152
126
Burden of Proof, findings of Commission, prima facie evidence, § 40.
in suit against Drug Trust, § 40a
Butchers, retail butchers subject to inspection
California, anti-trust laws of, § 60
•
Carrier, forbidden to be dealer, must furnish switches and terminal
facilities
See also COMMON CARRIER; RAILROAD.
Carriers by Water, when not within Commerce Act
Cars, common carrier must furnish
•
shipper may compel carrier to furnish, by mandamus
for interstate commerce, State cannot control, § 5.
percentage of, may be fixed by mandamus, § 27
Carcasses, may be destroyed
to be inspected
Cattle, to be inspected
•
Certificate, duty of inspector as to.
of inspection for shipper
•
•
Change of rates, must be on notice..
•
5, 6
XV
5
36
44
78
145
•
149
•
145
•
149
149, 150
8, 9
162
INDEX.
Charges, all charges must be reasonable..
greater, for longer than shorter haul forbidden.
•
for icing and storage included in term transportation.
Chesapeake and Ohio Case, importance of.....
•
PAGE.
3
6, 7
3
XXX1
Claims for damages to be filed with Commission within two years.. 24
jurisdiction of Federal courts as to assigned, § 40c....
Coal Properties, controlled by carriers..
Coastwise Steamship, when not within Commerce Act....
Colorado, common-law rule as to trust in, § 60..
Combinations in Pooling, by carrier, unlawful..
Commerce and Labor, secretary of, to make rules..
Common Carrier, defined under Interstate Commerce Act.
when pipe line companies are
express companies are
•
sleeping car companies are
•
forbidden to deal in commodities
must furnish switches and terminal facilities.
duty of, as to connecting lines..
forbidden to discriminate or give rebates.
97
xxii, xxiii
XV
•
127
138
•
•
1,
1,
2
2
61 61 61 2 21
cannot carry unless rates are filed by....
cannot extend privileges not specified in tariff's.
when liable for acts of agents and employees.
forbidden to prevent continuous carriage.
when liable in damages
criminal liability of
•
order for reparation against
Commission may regulate transportation of
failure of, to agree among themselves.
rates for connecting line of.
•
•
must pay for services and instrumentalities.
must comply with order of Commission
may review order of Commission
annual reports of, public records.
•
•
when not excused from complying with order.
must make uniform reports.
must keep uniform books
books and accounts of, may be examined.
first receiving property, liable.
must issue bill of lading
•
•
•
•
5, 6
6
10
10
12
13
•
•
•
14
14-17
20
21, 22
22
22
23
25
•
26, 27
28
·
may collect full fare from government troops, § 17..
forbidden to deal in commodities, § 20..
•
by acceptance of charter, assumes public trust, § 40d.
cannot contract to give exclusive privileges, § 40d...
29
30-33
30-33
32
34
34
62
63
100
•
•
•
100
INDEX.
· 163
Common Carrier
(Continued):
forbidden to blacklist employees, § 54a.
•
PAGE.
113
when liable to employee under Safety Appliance Law, § 62.... 131
when liable for penalty under Safety Appliance Law, § 63... 13!
liability of, to employees for damages.
community of interest among
result of acting as dealer.
coal properties controlled by.
power of visitation as to
•
135
xii
ix,
xx
xxii, xxiii
XXV
Common Law, Federal court cannot punish trust under, § 56..... 115
116 et seq.
when may be administered in Federal courts, § 56.....
as to trust and conspiracies in restraint of trade, § 57.....
Community of Interest among carriers
Commutation Tickets, when carrier may issue..
Complaint to Commission, how made
Compounds to be indicated by label
Concessions, granting of, punishable by imprisonment.
misdemeanor, under Elkins Act, § 23....
Confiscation, under Pure Food Bill
•
Connecticut, common-law rule as to trust in, § 60.
Connecting Carriers, Commission may fix joint rates for
Consignee may receive goods pending examination...
Conspiracy against United States, how punished, § 22.
to boycott, when restrained by injunction, § 54..
Constitutionality of immunity statute, §§ 8-11.
Contempt, when Examiner may be punished for
Continuous Carriage, unlawful for carrier to prevent.
Contracts must be filed by carrier with Commission
carrier must report all
•
•
118
xii
35, 36
20
141
11
73
142, 143
127
22
•
143
69
11]
45-49
33
13
•
9
31
when overlapping contracts illegal, § 24.
when, will not effect right to mandamus, § 28.
75
·
•
79
for sale of steamboats when not within Sherman Act, § 48.... 105
not to sell goods outside of State when not within Sherman
Act, § 50
107
•
•
illegal under Sherman Act, not enforcible, § 51.
with carrier when no bar to action for damages.
Copies of contracts and agreements must be filed.
of reports to be furnished
of contracts and schedules public records.
Copyright, when book trust not protected by, § 52.
Corporation liable for acts of agents, receivers, and trustees.... 10, 11
immunity does not extend to, § 12...
52
108
•
•
136
9
•
21
•
28
108
•
164
INDEX.
Cost of meat inspection to be paid by the government.
Counterfeit labels prohibited
•
Court may fix amount of attorney's fee....
may suspend or modify order of Commission
•
may enforce order of Commission for money damages.
authorized to issue injunction
appeal from, direct to Supreme Court.
exclusive jurisdiction of Federal, § 29
Criminal Liability of carrier under Commerce Act..
under Commerce Act and Elkins Act, §§ 22-24.
•
PAGE.
152
148
14
22
•
•
23, 24
26
26, 27
82, 83
14-16
•
69-76
Cumulative Remedy, shipper entitled to...
35
Customs Duties on foreign shipments.
8
Damages, when common carrier is liable for.
14
complaint not to be dismissed for absence of direct damage....
order for, how enforced....
20
23,
24
order of Commission for, enforced in Federal court.
initial carrier liable for
•
orders for payment of, § 36.
•
•
23,
24
34
89
order for, how enforced, § 37..
92
under Sherman Act, may be recovered by municipal corpora-
tion, § 42
measure of, under Sherman Act, § 43.
Dealer, carrier forbidden to be, § 20.
legislation of 1906 as to, § 21.
101
101
63
•
68
•
29
Decision, after rehearing
See also Order.
Decree cannot be suspended without notice.
.. 27, 28
See also Order.
Defenses under Pure Food Bill
common carriers defined
CC
term railroad'
term
term
""
transportation
" rebates
""
142
Definitions, interstate commerce defined..
•
•
1,
1,
~ ~ ~ ~
2
2
2
3
6
10
""
92
139
139
•
139
•
139
"carrier" means common carrier
distinction between orders "lawfully” made, and “regularly
made, § 36
term "drug
<<
term food
""
adulteration as to drugs defined.
•
adulteration of confectionery defined
adulteration of food defined
•
•
140
INDEX.
Definitions
term
(C
(Continued):
misbranded" defined
•
term territory" under Pure Food Bill...
term "
person" under Pure Food Bill…….
articles of merchandise defined..
Delaware, common-law rule as to trust in, § 60.
Deposition, testimony by, how taken.
of foreign witness to be filed..
Discrimination in furnishing cars forbidden.
in moving traffic forbidden
unjust discrimination defined
•
granting of, punishable by imprisonment.
when refusal to designate route is not, § 17.
as to transportation of troops, § 19.
Pistrict Attorney, authority to prosecute
must recover forfeitures
165
PAGE.
140
144
144
157
127
•
19
20
5
5
6
11
59
62
18
25
District of Columbia governed by provisions of Sherman Act, § 60.. 127
Documentary evidence under Commerce Act, § 34.
See also EVIDENCE.
Drug Trust, burden of proof in suit against, § 40a.
Duties, fee, customs duties...
•
•
•
87
95
32
• •
14
Earnings, Commission may require monthly reports of.
Election of Remedies, when shipper must make..
Elkins Act (February 19, 1903), text of section 1, as amended June
29, 1906
violations of, where prosecuted
Eminent Domain, when telegraph companies may exercise, § 61.... 130
Employees, when blacklist of, forbidden, § 54a..
..
•
•
10-13
12
113
when, may recover against carrier under Safety Appliance
Law, § 62
131
•
Employers Liability Bill, text of
Equity, orders in equity, how enforced, § 38.
Evidence of concurrence in joint rates required..
documentary, production of compulsory.
reports and findings of Commission shall be
findings of Commission are prima facie
•
134-136
93
•
•
certified copies of reports
schedules filed are prima facie
documentary, under Commerce Act, § 34
burden of proof, findings of Commission, § 35
Examiners, Commission may appoint
when punished for divulging facts
18
20
23, 24
28
28
87
94
32,
33
166
INDEX.
PAGE.
Exclusive Jurisdiction of Federal courts defined, § 29.
See also JURISDICTION.
.. 82, 83
Expediting Act (February 11, 1903), applicable to suits under
Commerce Act ...
Expenses of Commission, how paid
of carrier must be furnished
•
Commission may require monthly report of
Experts in sanitation to be appointed.
Export, animals for, to be inspected.
•
•
Facilities of Shipment included in term transportation...
False Bills made criminal
•
False Classification made criminal
False Weights made criminal
•
Fares, schedule of, must be filed, printed, and posted.
carrier forbidden to refund...
Farmer, when, may slaughter animals on farm...
Federal Control, tendency toward
•
Federal Courts cannot punish common-law trusts, § 56.
when, may administer common law, § 56.
Fees of foreign witness
Felony, penalty for bribing meat inspector.
D
•
Fifth Amendment as to immunity defined, § 12.
Findings of Commission shall be evidence.
Fine for failure to publish rates.
for failure to keep books
for divulging facts
•
•
Five Thousand Mile Tickets, carrier may issue.
Florida, Anti-Trust Laws of, § 60...
Food, adulteration of, forbidden
misbrand of, forbidden
examination of specimens of
adulteration of, how punished
all meat foods to be inspected
·
Foreign Countries, rates to, must be printed and posted..
animals exported to, to be inspected
•
See also INSPECTION.
Foreign Shipments, criminal liability as to, § 23
Forfeiture of carrier for failure to obey order.
shall be payable to Treasurer of United States.
27
30
31
32
147
148, 149
3
15
15
15
7
10
151
•
iii, iv
115
116
20
151
52
20,
21
11
32, 33
33
35, 36
127
137
137
138
139
148
ร่
148, 149
73
25
25
•
INDEX.-
Forfeiture
(Continued):
for failure to file reports or answer questions..
of carrier for failure to keep accounts.
Forms for schedules prescribed by Commission
of accounts and records to be uniform..
•
Fourth Amendment, as to immunity, defined, § 13.
Fourteenth Amendment construed as to immunity, §§ 9, 10......
Free Transportation, when forbidden
who entitled to
•
penalty for giving
•
effect of amendment as to.
Freight Classification involves power to fix rates, § 18.
•
•
Freight Depots included in term railroad..
167
PAGE.
31
32, 33
9
3383
32
53
48
3, 4,
35
3, 4, 35
3, 4, 36
xii, xiii
61
3,
4
1,
2
2
127
145
153
•
106
49
152-157
xl
Gas Companies or pipe line companies not carriers within Commerce
Act.
Georgia, Anti-Trust Laws of, § 60....
Goats to be inspected
Gold, standard of articles manufactured from...
Good Will, when sale of, not within Sherman Act, § 49.
•
Grand Jury, examination before, § 10.
•
Hall-Mark Bill, text of
•
Hall Marks, early statutes as to
Harlan, Hon. John M., opinion of, as to conspiracy to boycott, § 54. 112
Harter Act, provisions of, as to ship owners....
xvi, xvii
Icing, refrigeration and storage included in term transportation. . . .
Idaho, trusts prohibited by Constitution of, § 60.
3
127
Illinois, Anti-Trust Laws of, § 60....
Imitations to be indicated by label
Immunity defined, § 7
statute defining, § 7
under federal statute, § 8
under State statutes, § 9.
• •
·
does not extend to corporation, § 12.
•
from search and seizure extends to corporation, § 13.
Imprisonment, granting or soliciting rebate, punishable by.
for crimes and conspiracies, § 22.
•
•
for violation of Meat Inspection Bill.
for violation of Pure Food Bill
for bribery under Meat Inspection Bill.
penalty under Jeweler's Liability Bill
penalty of, only partly restored,
•
127
141
•
45
45
47
48
52
53
11
• •
69
150
137
151
156
•
xviii
168
INDEX.
Improvements, character and cost of, must be furnished
Indiana, Anti-Trust Laws of, § 60..
Indian Territory, Anti-Trust Laws of, § 60...
•
Indictment for conspiracy against the United States, § 22.
Initial Carrier, when may prescribe route, § 16.
See also CARRIER.
Injunction, application for, on petition.
when orders of Commission enforced by
order continuing appeal from
must be taken within thirty days
may be invoked to restrain boycott, § 54...
when Federal court cannot enjoin State court, § 54b.
Inspection of animals and carcasses for export.
cost of, to be paid by government.
Inspectors of meats, how appointed.
duty of
to have access to packing houses
certificates of, to vessels
• •
•
Interstate Commerce, as to original package, § 1.
when State Liquor Laws not operative as to, § 2.
when sale of liquors is not, § 3..
•
•
·
•
PAGE.
31
127
•
127
71
• •
57
223
26
26
28
28
111
114
148, 149
152
•
144, 145
145
146
149
39
40
42
44
45
State cannot compel furnishing cars for, § 5.
Taxation of business within State, § 6.
carriers engaged in, forbidden to blacklist employees, § 54a.... 113
Interstate Commerce Act (as amended June 29, 1906), text of
section 1.
text of section 2
text of section 3 .
text of section 4
•
text of section 5
text of section 6
•
•
text of section 7
text of section 8
text of section 9
•
text of section 10
text of section 11.
text of section 12 ..
text of section 13
•
•
•
•
text of section 14
text of section 15
text of section 16
text of section 16a
text of section 17 . .
•
•
•
•
·
•
•
•
1-6
•
6
6,
7
7
7-10
•
13
14
14
14-17
17
18-20
20
20, 21
21-23
23-28
28, 29
29
INDEX.
Interstate Commerce Act (Continued):
text of section 18
text of section 19
text of section 20
text of section 21
•
text of section 22
text of section 23
•
169
PAGE.
2.9
30
30-34
35
35, 30
•
36, 37
37
xi-xv
text of section 24 .
Interstate Commerce Act, summary of amendments to..
Interstate Commerce Commission may order switches, sidings, and
terminal facilities
power of, as to long and short haul regulations..
may notify requirements as to publishing rates.
created under section 11
enlarged under section 24
•
term of office
how appointed .
how removed
may prosecute through United States District Attorney.
proceedings before, how conducted
may order reparation
may print reports for distribution.
has power to fix rates
may establish through joint rates
may make order regarding rates
may suspend or modify order
• •
•
•
• •
5,
6
•
• •
6,
7
9
17
37
17
17
17
18
•
·
•
20
21, 22
2 2 2 2 2 2≈
20
21
22
22
22
23
•
26
may fix charges for services and instrumentalities.
may employ special counsel with consent of Attorney-General..
orders of, how reviewed
may order rehearing
•
procedure before, how conducted..
salary of
•
sessions of, where held
may require uniform reports
• •
•
•
•
•
to have access to all accounts and records.
may employ special agents and examiners.
may apply for mandamus
•
26, 27
28, 29
29
29, 30-37
30
30-33
32
32
33, 34
35
S7
annual reports of, how made
•
orders of, under legislation of 1906, § 35..
orders of "lawfully" made and "regularly" made, §§ 36-39. 92-94
Investigations by Commission, how conducted
20
Iowa, Anti-Trust Laws of, § 60
127
Jewelers, liability of, for false hall-marks
153
•
Joint Rates, schedule of, to be filed, printed and posted.
7, S
provision as to
9
સ્વ
·
170
INDEX.
Joint Rates—(Continued):
order of Commission fixing
•
when not pooling, § 16 .
Joint Tariffs must be filed with Commission
Jurisdiction, offense begun in one jurisdiction and completed in an-
other
•
of federal courts as to mandamus, § 26.
of federal courts defined, § 29..
•
PAGE.
22
55
30
•
12
77
•
81
•
exclusive jurisdiction of federal courts defined, § 29.
of federal courts in case of assigned claims, § 40c.
of federal courts under Sherman Act not concurrent, § 41.... 100
82
•
97
•
Kansas, Anti-Trust Laws sustained, § 58.
121
provisions of Anti-Trust Act of, § 58...
122
127
128
145-147
Anti-Trust Laws of, § 60....
Kentucky, Anti-Trust Laws of, § 60.
Labels, term inspected and passed
term inspected and condemned
•
to be attached to meat food products
when refused
forged or counterfeit labels prohibited
Lessee, criminal liability of
•
•
Liability of individual members of a trust, § 44.
of carrier under Safety Appliance Law, § 62.
of carrier to employees for damages..
Libel, what to contain under Pure Food Bill.
may be filed under Pure Food Bill..
article falsely labeled to be destroyed
provision for marks, tags, and stamps.
Limitation, for rebates, six years
•
•
Liquors, when State laws applicable to sale of, § 2.
when sale of, not interstate commerce, § 3..
Louisiana, Anti-Trust Laws of, § 60.
Maine, Anti-Trust Laws of, § 60.
•
Mandamus, court may issue writs of...
•
on application of Commission or Attorney-General
may issue, to enforce provisions of Act
remedy to furnish cars and move traffic.
declared to be a cumulative remedy...
1906 legislation as to, § 25.....
jurisdiction of Federal courts as to, § 26.
writ of, may fix percentage of cars, § 27..
right to, when not effected contract, § 28.
Maryland, Constitution of, prohibits trust, § 60..
•
145-147
•
•
147
147-150
148
•
14, 15
102
131
134, 135
141
142
143
•
146
13
40
• • •
42
128
128
26
•
33, 34
34
36, 37
37
76
77
78
79
128
INDEX.
171
PAGE.
Massachusetts governed by common law as to trusts, § 60.
Maximum Rate, Commission may fix
See also JOINT RATES; RATES.
Meats, inspectors of, how appointed
uninspected meats prohibited
Meat Inspection Bill, text of
Michigan, Anti-Trust Laws of, § 60.
•
Mileage Tickets, when carrier may issue...
Minnesota, Anti-Trust Laws of, § 60.
Misbranded, defined as to drugs..
defined as to food
•
Misbranding of food, etc., forbidden.
Misdemeanor, violation of Elkins Act is.
•
128
21, 22
•
144, 145
•
148
144-152
128
35
128
•
•
140
•
141
• •
137
•
10,
11
33
128
123
128
23, 24
89
128
32
false entries or mutilation of books is.
Mississippi, Anti-Trust Laws of, § 60... .
Missouri, Anti-Trust Laws of, when unconstitutional, § 59
Anti-Trust Laws of, § 60..
•
Money, order for payment of, how enforced
orders for payment of, § 36……..
Montana, Anti-Trust Laws of, § 60....
Monthly Reports may be ordered by Commission
See also REPORTS.
•
Municipal Corporation may recover damages under Sherman Act,
§ 42.
Name of parties to print rates must be specified.
Nebraska, Anti-Trust Laws of, § 60.....
Negligence, liability of carrier to employee for...
contributory, question for jury
•
•
when contract with carrier no bar to suit for
Nevada governed by common law, as to trusts, § 60
101
9
128
135
•
135, 136
136
•
128
128
•
128
New Hampshire governed by common law as to trusts, § 60.
New Jersey governed by common law as to trusts, § 60.
New Mexico governed by provisions of the Sherman Act, § 60..... 128
•
New York, Anti-Trust Laws of, § 60...
North Carolina, Anti-Trust Laws of, § 60...
North Dakota, Anti-Trust Laws of, § 60.
Notary Public, deposition may be taken before.
when may take oath of carrier to reports..
129
120
129
19
32
172
INDEX.
Notice as to change of rates
Oath to reports of carrier, how taken.
•
PAGE.
8,
9
32
26
Obedience to order, how enforced
•
See also INJUNCTION.
Office of Commission, term of
Ohio, Anti-Trust Laws of, § 60..
37
129
Oil Refiners, when governed by Interstate Commerce Act..
Oklahoma, Anti-Trust Laws of, § 60...
ï
129
Order, supplemental order, joint rates.
22
of Commission fixing rates
when to take effect
•
22
22
for damages, how enforced
23
of Commission, how served
25
may be modified or suspended
•
25
failure of carrier to obey penalty and forfeiture.
25
•
when "regular," how enforced
of Commission, when enforced by injunction
venue of suits to set aside
26
26
27
cannot be suspended except on notice
• •
application for rehearing of
27,
28
28,
29
of Interstate Commerce Commission, legislation as to, § 35....
"lawfully" made and
87
regularly" made distinguished, § 36..
92
for damages, how enforced, § 37..
in equity, how enforced, § 38...
lawfulness of, how reviewed, § 39.
92
93
94
•
Oregon, governed by common law as to trusts, § 60
Original Package, what constitutes, § 1.
Overlapping Contracts, when criminal, § 24.
129
39
75
See also CONTRACTS..
Packing Houses, inspectors to have access to...
Parties, who may be joined as, and claim damages
rights of, under illegal contract, § 51...
Passes, when carrier may issue passes.
when forbidden...
•
See also TRANSPORTATION.
Patent Right, when trust protected by, § 53a...
Penalty, for giving free passes..
additional forfeit in case of rebate.
for disobedience of witness...
of carrier for failure to obey order.
•
•
146
24
108
35
.3, 4, 35
119
•
4, 36
13
18, 19
25
for failure to file reports or answer questions..
...31, 32
INDEX.
173
Penalty
(Continued):
for failure of carrier to keep accounts..
for failure to comply with Safety Appliance Law, § 63.
for violation of Meat Inspection Bill.
for violation of Jeweler's Liability Bill.
•
Pennsylvania, governed by common law as to trusts, § 60....
PAGE.
32, 33
Pipe Line Companies, when governed by Interstate Commerce Act. 1,
gas companies not included in....
Plated Ware, weight and fineness of, prescribed.
Pleading, under Sherman Act, §§ 40b, 46...
summary of complaint against beef trust, § 46.
Pooling by carrier unlawful...
what constitutes, § 15..
•
•
•
131
150
156
129
2
2
..155, 156
96, 101
103
7
55
55
6
when joint through rate is not, § 15.
Post-Mortem Examination, Secretary of Agriculture may direct... 145
Preferences and Advantages, carrier forbidden to give………….
Preservatives, when not to apply to meat food products..
Priority, on appeals from orders of Commission...
Proceeding in rem, applicable under Pure Food Bill...
Procedure before Interstate Commerce Commission.
in case rehearing is granted
•
Property of common carrier, value of, must be given..
Publication of rates condition precedent...
•
•
146
26, 27
142, 143
.28, 29
29
33
10
67
Public Policy, forbids carrier to be dealer, § 20…….
Purchaser, when excused from payment under Anti-Trust Laws,
$ 59
Pure Food Bill, text of..
•
Questions, common carrier must answer in writing.
Quotations of stock, when not within Sherman Act, § 47.
Railroad, term defined..
what included in definition.
term transportation defined....
common carrier, when..
within Commerce Act.
forbidden to deal in commodities.
123
136-14-1
..31, 32
101
2
CF10 19 19 19 19
に
​4,5
30-33
owner of, must make reports...
See also COMMON CARRIER.
Railroad Commission, may appear before Interstate Commerce
Commission
Railways, of United States, grouped.
statistics as to....
•
20
..iv,
V
174
INDEX.
Rates, schedule of, to be published and filed.
schedule of, what to contain.
•
•
of all terminal charges must be published and posted.
through foreign country must be printed and posted.
change of, must be on notice..
publication of, condition precedent.
published rate only lawful rate.
failure to publish misdemeanor..
·
published rate deemed only legal rate.
•
Interstate Commerce Commission may fix.
•
of payment by carrier for services and instrumentalities.
based on shipper's profits illegal, § 14.....
Rebates, prohibited.
granting or soliciting, a misdemeanor.
granting or soliciting, punished by imprisonment.
departure from schedule rate is..
what constitutes under Elkins Act.
forbidden under Elkins Act..
additional penalty for...
Attorney-General must prosecute.
· •
•
• •
may be recovered for period of six years.
three times total value may be recovered.
may be secured by freight classification, § 18.
indictable under Commerce Act and Elkins Act, § 23.
Rebating, imprisonment for, restored..
Receipt, or bill of lading, must be given by carrier.
Receivers of carrier, when liable to imprisonment.
criminal liability of...
accounts of, may be examined.
Rehearing, application for, how made.
Remedy of shipper, when not alternative...
•
of shipper not effected by bill of lading or receipt.
of shipper cumulative....
by mandamus to furnish cars or move traffic...
orders of Commission, legislation as to, § 35.
Reparation, may be ordered by Commission.
•
Reports and findings of Commission shall be evidence..
copies of, to be furnished..
of carrier must be uniform.
of carrier, what to contain
time to file may be extended. . .
penalty for failure to file....
Commission may require monthly
• •
PAGE.
1.
3
.7, 8
Տ
8
∞ ∞ ∞
•
8,
10
10
11
•
12
21
23
•
•
54
6
11
11
12
•
12
12
13
13
13
13
61
73
•
xix
34
.10,
11
•
14, 15
32
28, 29
14
34
•
•
35
•
36, 37
87
20
20, 21
21
30-33
30-33
31
.31, 32
32
INDEX.
175
Review of order on appeal to Supreme Court.
of lawfulness of order, § 39.....
See also APPEAL; ORDER.
PAGE.
.26, 27
91
Rhode Island, governed by common law as to trusts, § 60........ 129
Roosevelt, Hon. Theodore, recommendation of, as to power to be
given Commerce Commission
•
Route, when carrier may prescribe, § 16.
Rules, under Pure Food Bill, to be uniform.
of Secretary of Agriculture as to inspection of meat foods.
Safety Appliance Law, liability of carrier under, § 62.
•
57
138
148
• •
13'
•
duty of carrier under, not impaired...
Salary of Commission, fees and expenses.
136
.29, 30
•
Sale of steamboats' and carriers' business when not within Sher-
man Act, § 48
of good will when not within Sherman Act, § 49.
of book when not protected by copyright, § 53.
Samples of goods for export and import..
Schedules of rates and charges must be kept posted.
form of, prescribed by Commission.
failure to publish, misdemeanor.
departure from rate not deemed rebate.
of rates conclusive..
•
made prima facie evidence.
certified copies of.....
105
106
•
110
143
8
•
9
11
•
12
•
12
28
28
Search and Seizure, immunity from, extends to corporation, § 13..
53
Secretary of Commission may certify extracts anl reports..
28
Secretary of Agriculture, duties of, under Pure Food Bill.
may direct post-mortem examination...
145
•
145
Service of order of Commission, how made..
Sessions of Interstate Commerce Commission, where held..
Sheep, to be inspected...
Sherman Act, pleadings under, § 40b..
•
jurisdiction of Federal courts as to, § 41
measure of damages under, § 43.
Statute of Limitations, applicable to, § 45.
beef trust unlawful conspiracy under, § 46.
when stock quotations not within, § 47.
when sale of steamboat business not within, § 48.
when sale of good will not within, § 49..
when agreement not to sell goods outside State not within, § 50. 107
illegal contracts under, not enforceable, § 51.
when, cannot abrogate a patent right, § 53a.
•
•
•
•
108
110
25
30
145
•
96
100
• •
101
•
102
•
•
103
•
•
104
105
106
176
INDEX.
Shipper, can only receive facilities specified in tariffs
•
criminal liability of, for false bill, weights or classification...
when, may not prescribe route, § 16
must secure certificate of inspection.
•
PAGE.
10
16
57
149, 150
Ships, when not within Commerce Act
Sidings, common carrier must furnish.
Silver, standard of articles manufactured from.
South Carolina, Anti-Trust Laws of, § 60.
•
•
•
XV
5
154
•
129
129
South Dakota, Anti-Trust Laws of, § 60.
Special Counsel may be employed with consent of Attorney-General. 26
Specimens of food to be examined..
Spur Tracks included in term railroad..
Standard of weight and fineness for gold.
of weight and fineness for silver...
State cannot compel furnishing cars for interstate commerce, § 5..
when agreement not to sell goods outside of, not within Sher-
man Act, § 50....
Anti-Trust laws of, sustained, § 57a.
•
•
138
2
153
•
154
14
107
121
•
State Anti-Trust Laws, provisions as to relieving purchaser, § 59.. 123
enumerated, § 60..
126
State Court, when action pending in, no bar in Federal courts,
8 41
100
State Statutes as to immunity sustained, § 9......
Statute defining, immunity, § 7
applicable to Sherman Act, § 45.
•
under Employers' Liability Act
when Federal court cannot enjoin proceedings in, § 54b.
State Laws, when applicable to sale of liquors, §§ 2, 3...
when applicable to articles of gold and silver..
govern Statute of Limitations under Sherman Act, § 45.
Statistics, required to be furnished by carrier.
Statute of Limitations, two years for damage claims.
114
..40, 42
157
48
102
..30-33
46
24
•
112
136
•
40
Steamboats, when sale of business of, not within Sherman Act, § 48. 105
Stock Quotations, when not within the Sherman Act, § 47 ...... 104
Sumptuary Laws, application of Wilson Act as to, § 2.
Supervision by Federal government over carriers.
Supplemental Order, may be made by Commission.
See also ORDER.
• •
•
XXV
22
INDEX.
177
Supreme Court, direct appeal to, §§ 32, 33
Swine, to be inspected...
Switches, included in term railroad.
carrier must furnish.
•
on private land, rule as to, § 40d
•
Taft, Henry W., comments of, on Tobacco Trust cases.
Tariffs, must be filed and published..
See also RATES.
Taxation as to interstate commerce, § 6...
PAGE.
85
145
2
5, 6
99
xxxiv
8, 9
45
Telegraph Companies, when, may exercise eminent domain, § 61... 130
Tennessee, Anti-Trust Laws of, § 60..
Terminal Facilities included in term railroad.
order of Commission for, how enforced...
•
Testimony, may be taken before grand jury, §§ 10, 11.
Texas, Anti-Trust Laws of, sustained, § 57a.
Anti-Trust Laws of, § 60.
Through Rates, Commission may prescribe..
See also JOINT RATES.
•
Time within which to appeal from order of Commission.
within which questions must be answered......
within which to file uniform accounts may be prescribed..
See also APPEAL.
Tobacco Trust Cases, importance of.
comments of Mr. Taft as to.
•
Trades Unions, legalized by Act of Congress, § 54a.
member of, not to be blacklisted, § 54a.
constitution and by-laws of, what to contain, § 54a.
Traffic, memoranda of movement of, must be uniform.
shipper may compel carrier to move, by mandamus.
Treasurer, Secretary of, to make rules.
129
•
.2,
3
.5,
6
49
121
129
22
28
31
31
xxxi
xxxiv
113
113
•
114
32
•
36
138
62
•
•
•
10, 11
•
14, 15
32, 33
100
102
105
•
108
110
Troops, discrimination as to transportation of, § 19.
Trustees of carrier, when liable to imprisonment.
criminal liability of..
forfeiture of, for failure to keep accounts.
Trusts, under Sherman Act, jurisdiction as to, § 41.
liability of individual members of, § 44..
•
when sale of business of carrier by water is not, § 48.
as to copyrighted books, § 52....
when protected by patent rights, § 53a..
conspiracies at common law, § 57.
•
118
178
INDEX.
PAGE.
United States, rates from, to foreign country must be printed and
posted
to have preference in time of war...
conspiracy against, how punished, § 22.
8
10
69
provisions of Revised Statutes as to, § 22.
71
•
Utah, Anti-Trust Laws of, § 60...
129
Value of carrier's property must be given...
31
Vehicles included in term transportation...
3
Venue of suits against Interstate Commerce Commission.
27
of proceedings under Pure Food Bill...
142
Vermont, governed by rules of common law as to trusts, § 60..... 129
Vessels, importing animals, must procure certificate...
149
Virginia, governed by rules of common law as to trusts, § 60....
129
Visitation, power of, at common law..
XXV
War, preference to Government in time of.
10
Washington, Anti-Trust Laws of, § 60...
130
West Virginia, governed by rules of common law as to trusts, § 60.. 130
Wilson Act, application of, to sale of liquors, § 2...
construed as to sale of liquors, § 4.
Wisconsin, Anti-Trust Laws of, § 60.
Witness, attendance of, compulsory.
penalty for disobedience by.
deposition, how taken.
•
foreign witness, fees of.
•
•
•
Vyoming, Constitution of, prohibits trusts, § 60...
40
42
130
•
18
18
19
20
130
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•
UNIVERSITY OF MICHIGAN
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