Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1922-04-18
TYING CLAUSES IN
= LEASES INVALID.
Supreme Court Holds Lessor
Nav Not Restrict Lessee
80 -. by Contract.
CLAYTON ACT APPLIES
Agreements Which May Les.
sen Competitions and Cause
.o~ Monopoly Illegal.
/ q IA Associatct rress !

"
WtsIII%GTG< A,~il 17-Tho nv
inE" clauses i'm the leases uf the
Tented Shoe Machinery Corporation
End its associated companies, chal-
itnGod by the government under the
Clayton act. wcr, today declared in
Nkt!d by the supreme Court. in an
cPInion delivered 10y Justice Day.
.I-Ss;ice Mc>euua disscutod and Jus
,iSs Brandcis ala not participate in
thr consideration or decision u; the
casc
@.This system or tying restrictions
ia-l quite AS effective as cxprcsseu
cgsenauis could be, the cour; de
ciarcd and practically compeis the
use Of the machinery Of the lessor
,ssecpi upon risks which munufac-
tGlers Will not wiil.neIy incur.
.s<. The power l" enforce them
is<hmniprescnt. and their restraining
inHucncc constantly operates upon
tbWpstitorS and lossecS The fact
the tho lessor in many instances
f&feoor" 10 eu.orcs these provisions
co.'s not mas" them any less "grcv-
isents within the condemnation of
'M '"E '''' &C
=, '""'uS Lower court
-She District Cour: expressed the
corporation tina; tho form Of lease
it.adopied after the Clayton act be
came effective IS free from the re-
sT'ctive and lying clauses and is.
tffFetore, unoNjcct!onablc. the cisn-
l2p pointed out mat those leases are
rrfminable upon thirty days notice.
aaa stated they we're evldently
tramed in view o. The clayton act
ipn Mitigation likely 10 arise over
tHe former leases In view OF that
enactment
~ he District Court expressed thu
opinion that should the shoe ma
eh'nery company's con;cnton be
suS'tlned' leases containing them
YOU'D again be Insisted upon. Jus
''ce baF said' declaring that the
earnesiness and zeal with which the
right to use these clauses has been
insisted upon throughout confirms
the conclusion OF the trial Judge.
The .fate of these substituted forms
% tas eViHeh'IE depends upon the
'e VI ms SUIT
Prevent Such Use.
While the clauses OF the lease on.
Joined by the District Court do no,
contain specific agreements no, ,c
use The machinery OF a competitor
the Supreme Court found tina, til,
practical effect OF these drastic pro
visions is TO prevent such use.
that such restrictive and tying acree-
ments necessarily lessen competition
and lend to monopoly IS. we believe
equally apparent"
when it is considered that tho
United Company occupies n domi-
nant position in supplying shoe ma
chintry OF the classes involved" II
added, these covenants signed u,
the lessee and binding upon him Of.
tectually prevent him from ncouIr.
ing .;hc machinery Of comDcti,o,
OF the lessor except at the risk O..
forf&iting the right to use tho ma.
chin,s furnished by IN. j,ni,.h can.
panS which may be absolutely .s.
senthl to tho prosecution and sue.
cess. of his business"
suurl.m,p,. sherman
Considerable sr,c.. IN ia
is devoted ia ais,os,rs ~, ain,.
by the conna,y no, 81, -
Coust,s dccisio, j., 49, 49, .','
which was araIny, mo yor.rns.
preciudcd ,h, t.lny,o, az, ,..,.l
ground Thai IN. ;ss,ne ,od ho.r .,,,''
ndtud,catcd N. COZ, 49,.
the. CIav,on az, US ,,,,ansos
~