Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1921-12-22
Exit the Open Price Association
(Boston Transcript.)

(BoSt0n TranScrlpt.)
The decision of the Supreme
Court in the case of the American
Hardwood Association seems to ring
the knell of the open price associa-
TONS" These associations are NOM
inally an arrangement within a par
ticular trade for the purpose of noti-
flying the other members of that
trade of the prices made by individ-
ual members. Theoretically, no
pressure is put upon members to
cause them to make, or refrain from
making, any particular price. 1t is
merely voluntary exchange of in
formation concerning prices made.
But the effect Of the system undoubt-
eddy is, as Mr.. Justice Clarke, in an
nOuncing the decision of the Court,
appraises it-that is to say, it has a
tendency to enhance or maintain
prices at an artificial level. In sim
pie truth, it holds the lash of the or
ganiZation over the individual dealer
or the particular corporation. BY
checking complete freedom of action
through the immediate knowledge of
the whole proceeding on the part of
the trade in general, it operates to
prevent reductions and to stifle free
competition, Nominally a plan 10
Establish open competition" in re-
atty it forces the trade to pull to-
gether and restricts competition.
In so deciding the matter, the
Supreme Court looks clear through
the letter of the bargain between the
members of the Hardwood Manufac-
turers' Association, and attacks the
spirit of it. There is nothing in par
ticular the matter with the letter of
of the contract. The letter seems to
be the thing that influences Justice
Holmes, Mckenna and Brandeis in
their dissenting opinion. The in
formation which the price exchange
system obtains is open to the public.
1t is obtained in an entirely Constitu-
tional manner. The dissenting justi-
ces even invoke the fright of free
speech" in defense of the system.
Mr.. Justice Brandeis, who writes the
dissenting opinion, appears to take
the attitude of the strict construc-
zionist of the law. Inasmuch as the
plan is not inherently suppression
of competition, he is constrained to
find it to be lawful. And yet, after all,
Mr.. Justice Brandies finds it neces-
sary to go further than the letter of
the law. The indirect effect of the
open price domination may be, he
admits, to lesson competition, but
"the Sherman law does not prohibit
every lessenng of competition that is
desirable" That is to say,-it may be
to this extent in the nature of a trust
operation, but it is a good trust"
Against this reasoning the dictum
of the majority of the court is very
plain. All is swept away in one pas
sage of Mr.. Justice Clark's decision,
in which he says that the replies re-
garding prices, obtained by the intru-
sive questionable, are utilized in
predicting and promoting advances
in prices, by Withholding of products
from the market, awaiting higher
prices Thus the ingenuity of those
who go against the law while keep
ing within it" is once more wrecked
on the reef of judicial wisdom. The
decision of the Court vindicates the
sagacity of the President in calling
attention, in his address to Congress
of April II last, to the operations of
these open price associations as
thing ito the very great advantage
of the members and the equal disad-
vantage of the consuming public" In
this address, Mr.. Harding suggested
a REIMBURSEMENT to normal relation
through the action of Congress, but
the supreme court seems to have an
ticipated congressional action as far
as the continuation of open price,
operations is concerned.