Case Name: PAINE LUMBER COMPANY, LIMITED, ET AL. v. NEAL, INDIVIDUALLY AND AS SECRETARY AND TREASURER OF THE JOINT DISTRICT COUNCIL OF NEW YORK AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA AND AMALGAMATED SOCIETY OF CARPENTERS AND JOINERS OF AMERICA, ET AL.
Court: Supreme Court of the United States
Jurisdiction: United States
Decision Date: 1917-06-11
Citations: 244 U.S. 459
Docket Number: No. 24
Parties: PAINE LUMBER COMPANY, LIMITED, ET AL. v. NEAL, INDIVIDUALLY AND AS SECRETARY AND TREASURER OF THE JOINT DISTRICT COUNCIL OF NEW YORK AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA AND AMALGAMATED SOCIETY OF CARPENTERS AND JOINERS OF AMERICA, ET AL.
Judges: Me. Justice McKenna and Mr. Justice Van Devanter, dissenting.
Reporter: United States Reports
Volume: 244
Pages: 459–485

Head Matter:
PAINE LUMBER COMPANY, LIMITED, ET AL. v. NEAL, INDIVIDUALLY AND AS SECRETARY AND TREASURER OF THE JOINT DISTRICT COUNCIL OF NEW YORK AND VICINITY OF THE UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA AND AMALGAMATED SOCIETY OF CARPENTERS AND JOINERS OF AMERICA, ET AL.
APPEAL FROM THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT.
No. 24.
Argued May 3, 4, 1915;
restored to docket for reargument June 12, 1916;
reargued October 24, 25, 1916.
Decided June 11, 1917.
A private party cannot maintain a suit for an injunction under § 4 of the Sherman Anti-Trust Law.
Such action upon the part of a labor union as is involved in this case is not sub j ect to be enjoined under the laws of New York in a private suit.
214 Fed. Rep. 82, affirmed.
The case is stated in the opinion.
Mr. Walter Gordon Merritt and Mr. Daniel Davenport for appellants:
The combination falls within that class of restraints of .trade intended to coerce third parties and strangers from engaging in interstate trade except on conditions that the combination imposes, and therefore violates the Federal Anti-Tru!st Law.
The object is to control conditions of manufacture by preventing. the sale and use of manufactured articles unless they come from mills operated and exclusively manned by members of the combination. It is a combination between the sources of production and those who control distribution and consumption, to limit the market to producers joining such combination. According to the defendants’ contention, they must protect the union mills from the competition of non-union mills because, under the natural law of trade and competition, the union mills cannot survive with their increased cost of production. The rule against using or working on open shop “trim” was therefore adopted to destroy open shop competition. The Master Carpenters’ Association also take active steps to enforce this régime in order to protect themselves from the competition of independent contractors using such material.
The conceded purpose is to increase profits and wages in the union mill and to do this by the only possible method .by which men working on buildings could accomplish such a purpose, viz: restraining trade or commerce by making open shop products unsalable. There is no relation between the buildings and the factories except commerce, so that the only way in which the conditions in the mills can be affected by the conduct of the men at the buildings is by controlling commerce.
The union manufacturers and their employees have an undoubted interest in extending the sale and use of any merchandise which is produced by their joint efforts, and may, therefore, justify and excuse any injury which they inflict upon their competitors by the ordinary methods of legitimate competition. They cannot, however, by association or combination with journeymen who have no such interest, but exercise a despotic control over the use and installation of such products, destroy the competition, of business rivals and monopolize the market. This is no ordinary labor case, but an instance where the defendants are seeking to project their influence into trade and commerce for the purpose of preventing the sale and distribution of completed articles of common use produced by their competitors. It is an attempt to drive open shop products out of commerce.
The distinction between a combination where parties subject themselves to-a self-imposed restraint, and a combination which has also the objective purpose of interfering with outsiders, has been recognized by this court, which holds that the latter combination implies a wrongful purpose. United States v. Patten, 226 U. S. 525; Loewe v. Lawlor, 208 U. S. 274; Northern Securities Co. v. United States, 193 U. S. 197; Standard Oil Co. v. United States, 221 U. S. 1; Thomsen v. Union Castle Mail S. S. Co., 166 Fed. Rep. 251; State v. Duluth Board of Trade (Minn.), 121 N. W. Rep. 395; Brown & Allen v. Jacobs Pharmacy (Ga.), 41 S. E. Rep. 553.
If the object of the combination be the illegal one described, it is immaterial that the means are otherwise innocent and lawful. There is nothing talismanic about the right to Strike which excepts it from this -universal and wholesome rule of law. Aikens v. Wisconsin, 195 U. S. 204; Gompers v. Bucks Stove & Range Co., 221 U. S. 418; Swift & Co. v. United States, 196 U. S. 375; United States v. Reading Co., 226 U. S. 324; Loewe v. Lawlor, supra.
This doctrine that an act otherwise legal may become illegal when exercised in furtherance of an illegal con spirácy has been frequently applied in the case of strikes. [Citing numerous authorities.]
If the means employed are calculated and intended to •restrain interstate trade, it is immaterial that they are to be performed or operate entirely within the limits of one State. Loewe v. Lawlor, supra; United States v. Reading Co., supra; Swift & Co. v. United States, 196 U. S. 375; Northern Securities Co. v. United States, 193 U. S. 197; United States v. Terminal R. R. Assn., 227 U. S. 683.
The case at bar is undistinguishable in principle from the cases of Montague v. Lowry, 193 U. S. 38; Loewe v. Lawlor, supra; Eastern States Retail Lumber Dealers’ Assn. v. United States, 234 U. S. 600, and Lawlor v. Loewe, 235 U. S. 522. The- judges in the lower court entertained no doubt as to the applicability of the Anti-Trust Law. Irving v. Neal, 209 Fed. Rep. 471; Paine v. Neal, 212 Fed. Rep. 259 (case at bar).
The complainants, being irreparably injured in their property rights by acts in violation of the Anti-Trust Law, are entitled to an injunction. The jurisdiction of the District Court was invoked both on account of diversity of citizenship and the Anti-Trust Law. The complainants appealed to its general equitable powers to protect them from irreparable injury to their property rights by unlawful and criminal acts. To deny the power and duty of the chancellor to protect property rights from irreparable injury- due to criminal acts, involves an overthrow of fundamental principles and unfortunate consequences which would be far-reaching. If the Federal Anti-Trust Law supersedes all other law relative to combinations which restrain interstate trade and is to be construed as denying the right of an injunction to a private party, then persons irreparably injured in their property rights by such criminal acts, which were exclusively in restraint of interstate trade, would be deprived of their property without due process of law. The federal statute is only declaratory of the common law without adding to or subtracting from the substantive offense; it specifies the remedies of treble damages, confiscation, and injunctipn by the government, which were not available under the common law, and, by making restraints which were purely subjective in their nature affirmatively unlawful, entitles a private party suffering damage therefrom to all available civil remedies. Since the law does not lay down any new rule as to combinations which are legal or illegal, thé remedies which it prescribes are cumulative and do not exclude common-law remedies.
The law should be construed with a view to suppressing the mischief and advancing the remedy for which it is obviously designed, and to carry with it all the incidents and available remedies which usually accompany such statutes. Upon this question, however, the lower courts are in disagreement.
The cases holding that parties injured by acts in violation of this law are entitled to an injunction under general equitable principles are as follows: Bigelow v. Calumet & Hecla Mining Co., 155 Fed. Rep. 877; affd. 167 Fed. Rep. 721; United States v. Addyston Pipe & Steel Co., 85 Fed. Rep. 279; Mannington v. Hocking Valley Ry. Co., 183 Fed. Rep. 140; De Koven v. Lake Shore & Michigan Southern Ry. Co., 216 Fed. Rep. 955; Hitchman Coal & Coke Co. v. Mitchell, 202 Fed. Rep. 512; Walsh v. Association of Plumbers (Mo.), 71 S. W. Rep. 455. [Counsel then cited contrary decisions of the lower federal courts, a number of which are mentioned in the dissenting opinion.]
It is our contention that under general principles any person specially injured in his property rights by criminal or unlawful acts is entitled to the usual and appropriate civil remedies to protect him therefrom, and that there is nothing in the Sherman Act which deprives him of that right or contracts the power of the District Court to grant him injunctive relief. Hayes v. Michigan Central R. R. Co., 111 U. S. 228; Willy v. Mulledy, 78 N. Y. 314; Mairs v. Baltimore & Ohio R. R. Co., 175 N. Y. 413; Huda v. American Glucose Co., 154 N. Y. 481; Angle v. Chicago & St. Paul Co., 151 U. S. 2; Bitterman v. Louisville & Nashville R. R. Co., 207 U. S. 206; 1 Rev. Swift’s Dig., side page 553; In re Debs, 158 U. S. 593, 594; Cooper v. Whittingham, 15 Ch. Div. 501; Parker v. Barnard, 135 Massachusetts, 120; Hayes v. Porter, 22 Maine, 371; Toledo A. A. & N. M. Ry. Co. v. Penn Co., 54 Fed. Rep. 730; Hardie-Tynes Mfg. Co. v. Cruse (Ala.), 66 So. Rep. 657; Thomas v. N. O. & T. P. Ry. Co., 62 Fed. Rep. 821.
The fact that Congress has since given a private individual the right to an injunction, by the Clayton Act, seems to indicate what was its intention under the original act.
The complainants have suffered special damages entitling them to injunctive relief.
The defendants’ combination violates §§ 340 and 341 of Article 22 of the General Business Law of New York, and complainants, being irreparably, injured in their property rights by such unlawful, acts, are entitled to an injunction.
If the acts of the defendants constitute a misdemeanor under the terms of this state statute, then the plaintiffs are entitled to all the appropriate and usual civil remedies, even though those remedies are not prescribed by the statute. It is the settled law of New York that one who is specially injured .by an act forbidden by the criminal law is entitled to civil relief. Kellogg v. Sowerby, 190 N. Y. 370; Rourke v. Elk Drug Co., 77 N. Y. Supp. 374; Dueber Co. v. Howard Co., 24 N. Y. Supp. 647; Straus v. American Publishers’ Assn., 177 N. Y. 473; 193 N. Y. 496; 199 N. Y. 548; 231 U. S. 222; 85 App. Div. 446; Park & Sons v. National Druggists’ Assn., 175 N. Y. 1; Locker v. American Tobacco Co., 195 N. Y. 565. The statute is little more than a codification of the common law. Matter of Davies, 168 N. Y. 89; People v. American Ice Co., 120 N. Y. Supp. 443. The commodities produced by plaintiffs are included. The motive which actuates the members of the combination is immaterial, but' the purpose and object of the combination is material. Kellogg v. Sowerby, 190 N. Y. 370; People v. American Ice Co., 120 N. Y. Supp. 443; Schwarcz v. International Union, 124 N. Y. Supp. 968; State v. Minneapolis Milk Co. (Minn.), 144 N. W. Rep. 417. If the plaintiffs are to prevail under this statute, it is because the acts of the defendants constitute a public offense forbidden by the statute and have resulted in injury to the plaintiffs. The character of the participants is immaterial. The fact that the defendants are endeavoring to suppress competition in the supply and price of completed articles in common use removes their combination and conduct from the case of National Protective Assn. v. Cumming, 170 N. Y. 315, and brings them within the purview of the Anti-Trust Law. Rourke v. Elk Drug Co., 77 N. Y. Supp. 375; Loewe v. Lawlor, 208 U. S. 274.
If the combination .of the defendants is illegal, then every act in furtherance thereof, though otherwise innocent and constitutionally protected, becomes illegal because done in furtherance of the illegal purpose. Acts which might be innocent when done by one person may become illegal when done by a number in combination in violation of the statute. Rourke v. Elk Drug Co., 77 N. Y. Supp. 375; Locker v. American Tobacco Co., 195 N. Y. 565; Locker v. American Tobacco Co,, 106 N. Y. Supp. 118 (Judge Gaynor’s opinion); Walsh v. Dwight, 58 N. Y. Supp. 91.
Generally as to the application of this law to cases like the present, see People v. McFarlin, 89 N. Y. Supp. 527; Irving v. Neal, 209 Fed. Rep. 471; Paine v. Neal, 212 Fed. Rep. 259; Gill Engraving Co. v. Doerr, 214 Fed. Rep. 111. Within the meaning of this act defendants’ combination (a) seeks to create and maintain a monopoly in the manufacture, production and sale of the articles in question. Their own reports show that they have already acquired a complete monopoly at higher prices of trade in wood trim on the Island of Manhattan, ther eby terminating all trade in that borough with any open shops, People v. American Ice Co., 120 N. Y. Supp. 443. (b) It attempts to restrain or prevent competition in the supply and price-of these articles. ■ (c) It seeks to restrain or prevent the free pursuit of a lawful trade or business, in order thereby to create or maintain a monopoly in the production and sale of these articles. Straus v. American Publishers’ Assn., supra; People v. McFarlin, 89 N. Y. Supp. 527; Cummings v. Union Blue Stone Co., 164 N. Y. 401; Arnot v. Pittston Coal Co., 68 N. Y. 558.
The restraint is not incidéntal to any legitimate end which the defendants seek, but is the direct purpose of the combination. The benefits sought by the defendants are the result of the restraint of trade, and the restraint of trade is not the result of the benefits or incidental to them.
The defendants’ combination violates subdivision 6 of § 580 of Article 54 of the Penal Law of New York; also subdivision 5 of § 580 of that law; also § 530 of Article 48 of that law.
Section 582 of the Penal Law of New York is declaratory of the common law and does not legalize the defendants’ acts.
A combination of traders, to promote their own interests by suppressing the competition of rivals, is illegal at common law and it is immaterial whether the combination aims at one rival or a class of rivals. If the complainants are being irreparably injured in their property rights by unlawful acts committed within the State, they would be entitled to relief regardless of the existing federal law, whether those acts were unlawful at common law or because of some state statute.
The facts establish a combination to cause strikes against customers of complainants for the purpose of preventing the sale of their products as long as they operate an open shop, and is, in effect, a secondary boycott of the complainants, ■ which is unlawful. [Citing many authorities].
The combination of defendants to bring about the employment of members of their organization exclusively in their industry throughout an entire community is unlawful. [Counsel here went into an analysis of the means employed and the rights affected and dangers involved, referring to numerous authorities.]
The relief prayed for will not interfere with the legal provisions of any of the arbitration agreements.
Complainants are entitled to an injunction under § 16 of the Clayton Act, of October 16, 1914. This section is declaratory of ancient common-law principles and is highly remedial, and should be construed so as to advance the remedy. It was meant to remove doubt, arising from divergent federal decisions, and is to be taken as a legislative construction of the prior law, of retrospective operation, applicable to pending suits like this. Bailey v. Clark, 21 Wall. 284; Tiger v. Western Investment Co., 221 U. S. 286; Missouri Pacific Ry. Co. v. United States, 189 U. S. 274; Dinsmore v. Southern Express Co., 183 U. S. 115; Sampeyreac v. United States, 7 Pet. 222; United States v. The Schooner Peggy, 1 Cranch, 105.
It was not the intention by § 6 of the Clayton Act to change in any respect the Sherman Anti-Trust Act as it had been construed and applied by this court in any case. The history of the legislation, shown by the committee reports and even the debates in Congress, establishes this. Moreover, the act in § 4 re-enacts, word for word, § 7 of the Sherman Anti-Trust Act, under which the Loewe Case was brought to and decided by this court, without excepting that or any other case from its provisions, which action, upon established principles of construction, is an adoption by Congress of the doctrines of that case.
The presence of § 6 in the act is due to the fact that it was thought desirable to put at rest the contentions, of some, that the existence of labor unions for legitimate purposés was forbidden by the Sherman Anti-Trust Act.
Section 20 of the Clayton Act has obviously no application since here the relation of employer and employee does not exist actually or prospectively between the contending parties.
It is further obvious that the various acts mentioned in §20, against which injunctions shall not issue in this limited class of cases, are most of them acts which in and of themselves are ordinarily lawful, and that this section accomplishes no other purpose than to declare the previously existing law on this subject. The recognition of a right by a statute, such as the Claytci Act, will not justify the exercise of that right in furtherance of a criminal conspiracy, which is expressly defined by the same statute. Aikens v. Wisconsin, 195 U. S. 194; Gompers v. Bucks Stove & Range Co., 221 U. S. 439.
Otherwise construed, the Clayton law would be unconstitutional as class legislation, and depriving persons of .property without due process of law. Cleland v. Anderson, 66 Nebraska, 252; Connolly v. Union Pipe Co., 184 U. S. 540.
It is proper for the complainants to unite as co-plaintiffs since they were all similarly affected by the same combination.
Mr. Charles Maitland Beattie for the labor union appellees.
Mr. Frederick Hulse for appellees.
Mr. Anthony Gref, Mr. Charles J. Hardy and Mr. Fred erick P. Whitaker filed a brief in behalf of appéllee James Elgar, Inc.

Opinion:
Mr. Justice Holmes
delivered the opinion of the court.
This is a bill in equity brought by corporations, of States other than New York, engaged in the manufacture of doors, sash, etc., in open shops, against officers and agents of the United Brotherhood of Carpenters and Joiners of America and of the New York branch of the same, certain union manufacturers of doors, sash, etc., members of the Manufacturing Wood Workers' Association, and many master carpenters,, members of the Master Carpenters' Association, whose business is to install such products in buildings. The bill was dismissed by the District Court, 212 Fed. Rep. 259, and the decree was affirmed by the Circuit Court of Appeals. 214 Fed. Rep. 82; 130 C. C. A. 522.
The bill alleges a conspiracy of the members of the Brotherhood and the New York branch to prevent the exercise of the trade of carpenters by any one not a member of the Brotherhood, and to prevent the plaintiffs and all other employers of carpenters not such members from engaging in interstate commerce and selling their goods outside of the State where the goods are manufactured, and it sets out the usual devices of labor unions as exercised to that end. In 1909 the Master Carpenters, coerced by the practical necessities of the case, made an agreement with the New York branch, accepting a previously established joint arbitration plan to avoid strikes and lockouts. This agreement provides that "there shall be no restriction against the use of any manufactured material except non-union or prison made"; the arbitration plan is confined to shops that use union labor and the employers agree to employ union labor only. The unions will not erect material made by non-union mechanics. Another agreement between the Manufacturing Wood Workers' Association, the Brotherhood and the New York branch also adopts the plan of arbitration; the labor unions agree that "none of their members will erect or install non-union or prison made material," and the .Wood Workers undertake that members of the Brotherhood shall "be employed exclusively in the mills of the Manufacturing Wood Workers' Association." It is found that most of the journeymen carpenters in Manhattan and part of Brooklyn belong to the Brotherhood, and that owing to their refusal to work with non-union men and to employers finding it wise to employ union men, it is very generally impracticable to erect carpenter work in those places' except by union labor. It also is found that owing to the above provisions as to non-union material the sale of the plaintiffs' goods in those places has been made less. The workmen have adopted the policy complained of without malice toward the plaintiffs, as part of a plan to bring about "a nation-wide, unionization in their trade."
An injunction is asked against the defendants' (other than the Master Carpenters) conspiring to refuse to- work upon material made by the plaintiffs, because not made by union labor; or enforcing by-laws intended to prevent working with or upon what is called unfair material; or inducing persons to refuse to work for persons purchasing such material, or taking other enumerated steps to the same general end; or conspiring to restrain the plaintiffs' interstate business in order to- compel them to refuse to employ carpenters. not members of the Brotherhood. It is prayed further that' -the provision quoted above from the Master Carpenters' agreement and another ancillary pne be declared void and the parties enjoined from carrying them out. No /other or alternative relief is prayed. The ground on which the injunction was refused by the District Court was that, although it appeared that the agreements above mentioned were parts of a comprehen sive plan to restrain commerce among the States, the conspiracy was not directed specially against the plaintiffs and had caused them no special damage, different from that inflicted on the public at large. The Circuit Court of Appeals, reserving its opinion as to whether any agreement or combination contrary to law was made out, agreed with the judge below on the ground that no acts directed against the plaintiffs personally were shown.
In the opinion of a majority of the court if the facts show any violation of the Act of July 2, 1890, c. 647, 26 Stat. 209, a private person cannot maintain a suit for an injunction under § 4 of the same, Minnesota v. Northern Securities Co., 194 U. S. 48, 70, 71, and especially such an injunction as is sought; even if we should go behind what seems to have been the view of both courts below, that no special damage was shown, and reverse their conclusion of fact. No one would maintain that the injunction should be granted to parties not showing special injury to themselves. Personally j I lay those questions on one side because, while the Act of October 15, 1914, c. 323, § 16, 38 Stat. 730, 737, establishes the right of private' parties to an injunction in proper cases, in my opinion it also establishes a policy inconsistent with the granting of one here. I do not go into the reasoning that satisfies me, because upon this point I am in a minority.
As this court is not the final authority concerning the laws of New York we say but a word about them. We shall not believe that the ordinary action of a labor union can be made the ground of an injunction under those laws until we are so instructed by. the New York Court of Appeals. National Protective Association of Steam Fitters & Helpers v. Cumming, 170 N. Y. 315. Certainly the conduct complained' of has no tendency to produce a monopoly of manufacture or building', since the more successful it is the more competitors are introduced into the trade. Cases like Kellogg v. Sowerby, 190 N. Y. 370, concerning conspiracies between railroads and elevator companies to prevent competition, seem to us very clearly not to have been intended to overrule the authority that we cite, and not to have any bearing on the present point.
Decree affirmed.