Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-01-04
PRICE CONTROL
METHOD UNF AIR
ED|CT Of COURT
Supreme Bench Divides
5 to 4 Against Beech
nut acker Practices.
Tribunal Falls Back on
3 Former Decisions
Under Sherman Law.

Washington, JAN 3.-Lawful trad
methods were further defined Tuesda,
by the supreme court in a decision hold
ing that the trade methods and policies
of the Beechnut Packing company, i,
obtaining cooperation of its distribu
tors and customers, to be unfair meth
DDS of competition within the meaning
of the federal trade commission act.
In upholding the right of the fed
eral trade commission to order discon
tinuances of such methods. the cour
divided five and four. Justice Day de
| livered the opinion of the court ant
Justices Holmes. Mckenna, McRey
nolds and Brandeis dissented. The de.
cision reverses the lower courts
| If the Beechnut system of merchan
dising is against public policy because OF
its dangerous tendency to hinder com
petition or to create monopoly the
court maintained, '.it was within the
power of the commission to make al
order forbidding its continuation.
May In No Way Hinder Trade
Three trade method eases previously
decided by the supreme court-which
were brought under the Sherman anti
trust law, and not under the federal
trade commission act, as was the
Beechnut-settled. the court stated
that under the provisions of the Sher-
man act, a trader is not guilty of yio-
ating its terms who simply refuses to
sell to others and he may withhold his
goods from those who will not sell
them at the prices he fixes for their
resale
He may not go beyond the
exercise of this right" it added, "and
by contract or combination, express or
t,.t Is1t, H. IL.
free and natural flow of commerce in
the channels of interstate trade
Case Went Beyond Mere Refusal
In the Beechnut case. the court stat
ed that the facts found show that the
Beechnut system goes beyond the sim
pie refusal to sell goods to persons who
will cot sell at stated prices, which in
the Colgate case was held to be within
the legal rights of the producer
The Sherman act was not involved
icy to be considered in determining
what are unfair methods of competi-
ton which the federal trade commits
sion is empowered to condemn and
suppress.
The methods and plan of the Beech
nut company in its trade policy were
described by the court. which asserted
that the concern refused to sell its
products to virtually all jobbers. whole
salers and retailers who do not sell at
prices it suggests or who resell to other
johbers. wholesalers and retailers who
have failed to resell at prices suggest
ed by it. Further. that it refused to
sell to virtually all mail order houses
engaged in interstate commerce. be-
cause they frequently sell at cut prices,
and had refused to sell to virtually all
jobbers. wholesalers and retailers who
sell products to mail order houses. The
court also said it had refused to sell to
all so-called price cutters.
Company Maintained Lists
Reference was also made by the
court to the various lists maintained by
the company of dealers, with key num-
bers to enable it to identify the distrib-
ntors from whom jobbers and retailers
purchase. enabling its representatives
to identify price cutters, as we'll as
those from whom they obtained their
supplies, the company refusing to sell
10 the dealers from whom the retailers
who cut prices obtained their supplies.
Card records. the court asserted, also
we're maintained with the names of
of jobbing wholesale and re-
all distributors, using to indicate var ,
Gus classes of trade the words "unde-
,irable price cutters do not SELL" or
ID. n. S. the abbreviation for do
lot SELL" or expressions of like char
lctcr.