New-York tribune., 1921-06-11
New Plan to Fix
4 'r'ices Charged
By Urnterlnyer
Building Material FIR m S
Seeking To Resume Busi.
ness orr Former Basis
Quote Speech by Hoover
Say Law Was Not Broken
Lockwood Committee Coun-
sci Warns Group Not to
Renew Old Methods

composed OF firms engaged chiefly in
dealing in building materials, are
seeking authority to resume their
operations on basis similar to that
which existed before they promised
the Lockwood investigating committee
to dissolve.
This fact became known yesterday
through the spondence between
Clark McKercher, counsel for Albert A.
Ainsworth, the secretary of thirteen
exchanges, and Samuel Untermyer,
counsel for the Lockwood committee.
The outstanding feature in the sit
uation is the fact that three of the
exchanges base their appeal to do busi-
ness in the old manner upon alleged
published statements of Attorney Gen
eral II. M. Daugherty and Secretary of
Commerce Herbert Hoover Mr.. I'm
termyer in his replying letter yester-
day warned McKercher that any at
tempt to break the promise would be
followed by immediate prosecution.
Reference Made to Hoover
McKercher in his letter of June Z
draws the attention of Mr. Untermyer
to statements attributed to the two
Cabinet officers, and conveys the i'm
preston that they might be used by
the exchanges as justification in break
ing their agreement with the Lockwood
committee by resuming the practice of
price ard pl oduction reporting.
Secretary Hoover's speech before rep
resentatives of the chemical industry,
as reported by the Chamber of Com
merce of the United States, is referred
to by Mr.. McKercher in part as fol-
lows:
"At the meeting with the chemi cal
men Secretary Hoover warned against
overproduction of chemicals, acids,
crude drugs, etc, that might occur be-
cause OF the more or less lack of
knowledge in the industry Of the extent
of demand Such q situation is en-
tirely possible, he pointed out, citing
as an example the condition in the
autom obile tire market a short time
ago. eHe declared that the way to con-
trol the matter is to inaugurate sys-
TEN whereby frequent and accurate
statistics would be available to all in
terested."
After going into this reported speech
in detail Mr. McKercher cites the tes-
timony before the Lockwood Committee
concerning the Brass and Copper Sta
tistical Exchange, whose dissolution
was demanded and promised, and then
continues.
"That exchange did not report quota
tons and did not report any price
secured on closed business. They did
report total tonnage monthly on PRO
duction and sales, without any detail
as to price, destination of goods or
identity of customers. That, of course,
all ceased in conformity to the resolu-
ton which you have.
'It is very difficult for many of these
n ctnrers, honest, earnest loyal
eftizens. 10 understand why | must
advise them to meet your views here
If New York on the collection and dis
tribution 4af this statistical data per-
tanning to~their general, coVntry-wid.e
business, when the Federal authori-
ties are approving the very thinga
they believe will be of general and
lasting benefit to the whole trade"
Price Fixing Within Law
The interview with Attorney Gen
eral Daugherty is understood to have
been one in which Mr. Daugherty
pointed out that many of the trade
combinations complained of were care
fu}l to keep within the law by cover
under some other Characterization.
Some of the laws, it was suggested,
might have to be made more stringent
before successful prosecutions on any
large scale could be undertaken.
Mr.. Untermyer's views upon the mat
ter are contained in his letter sent
yesterday, which reads, in part:
"If you intend to imply that any of
the so7called 'Ainsworth associations
intend to resume the practice which
you and Mr.. Ainsworth assured me had
been discontinued by resolution of the
various associations, want to say
that if such. thing is attempted it
Will constitute gross breach of faith
on the part of the many members of
the various associations and that they
will take such action at their peril.
81 have a high personal regard for
Secretary Hoover, who, by the way, is
not a lawyer. If he made the i'll
advised statement attributed to him
on the subject of overproduction, it is
because he did not consult lawyer
The circular of the I'd inst. issued
by the Chamber Of Commerce of the
United States furnishes no justifca-
tion for anything contained in your
letter.
Warning by Untermyer
A'N"SNSl an tAiS may De, Tue
Ainsworth exchanges are, from a legal
standpoint, of most Objectionable
character, Their so-called exchange of
information among the members was a
mere cover for price regulation. The
law has not been changed since they
openly agreed to discontinue their
Objectionable practices.
Unti the laws are altered so as to
provide for governmental supervision
of these masquerading price-fixing as
and until the machinery is
set up in connection with such laws
by which their acts can be scrutinized
so as to prevent them from fleeing
the public, every effort will be made
to punish the offenders, especially
those who deliberately offend in dis
regard of their promises of reform"
Mr.. Untermyer will confer to-day
with Federal District Attorney Will
liam Hayward regarding Federal pros
ecution of cement and other building
material combinations engaged in
interstate commerce.
On his way to Buffalo next week he
will confer with Governor Miller in
Albany and Attorney General Newton
regarding the necessity for a special
session of the Legislature to pass
measures necessary to put the commit
tees recommendations into force.