Opinion ID: 390261
Heading Depth: 2
Heading Rank: 1

Heading: The Statutory Exemption

Text: 16 Labor's statutory exemption from the Sherman Act is embodied in sections 6 and 20 of the Clayton Act, 15 U.S.C. § 17 and 29 U.S.C. § 52; and sections 1 through 15 of the Norris-LaGuardia Act, 29 U.S.C. §§ 101 to 115. 17 Section 6 of the Clayton Act, 15 U.S.C. § 17, provides that labor unions are not unlawful, and that neither the unions nor their members may be considered illegal combinations or conspiracies in restraint of trade. Section 20 of the Clayton Act, 29 U.S.C. § 52, and section 4 of the Norris-LaGuardia Act, 29 U.S.C. § 104, prohibit courts from issuing injunctions against certain specified activities arising from labor disputes. 7 Section 20 of the Clayton Act has also been construed to provide that conduct made non-enjoinable by the Clayton and Norris-LaGuardia Acts cannot be held to violate any federal law. 8 Thus, conduct made non-enjoinable by these acts is also exempt from the antitrust laws. 18 Defendants here are a group of construction industry employers. The statutory exemptions from the antitrust laws found in the Clayton and Norris-LaGuardia Acts were, however, designed primarily to protect working men in the exercise of organized, economic power, which is vital to collective bargaining. Brotherhood of Railroad Trainmen v. Chicago River and Indiana Railroad, 353 U.S. 30, 40, 77 S.Ct. 635, 640, 1 L.Ed.2d 622 (1957). See also Cordova v. Bache & Co., 321 F.Supp. 600, 605-06 (S.D.N.Y.1970). Given the statutory exemption's pro-labor purpose, how does the AGCC, an employers' group, expect to benefit from the exemption? 19 Although the AGCC appears to be claiming the statutory exemption, the AGCC fails to cite any specific statutory language in support of its claim. The only language that we have been able to find in the statutes that might conceivably benefit the AGCC is the following excerpt from section 20 of the Clayton Act: 20 (I)n any case between employers and employees involving, or growing out of, a dispute concerning terms or conditions of employment 21 no injunction shall prohibit any person or persons, whether singly or in concert, from ceasing to employ any party to such dispute, or from recommending, advising, or persuading others by peaceful and lawful means so to do nor shall any of the acts specified in this paragraph be considered or held to be violations of any law of the United States. 22 29 U.S.C. § 52. 23 Under this section, the AGCC's alleged conduct might be characterized as merely recommending or persuading others not to let contracts to union-signatory subcontractors, thereby exempting the conduct from the operation of the Sherman Act. The AGCC cannot benefit from this statutory exemption, however, for two reasons: (1) the exemption has not been extended to anticompetitive conduct involving groups of businessmen, and (2) such an extension, exempting antiunion conduct on the part of business groups, would be totally inconsistent with the pro-labor purpose for which section 20 was enacted. 24 To be exempt from the antitrust laws, the conduct described in section 20 must arise out of a dispute concerning terms or conditions of employment. The Clayton Act does not define the phrase a dispute concerning terms or conditions of employment used in section 20. For this reason, the broad definition of labor dispute found in section 13(c) of the Norris-LaGuardia Act, 29 U.S.C. § 113(c), has been read into section 20 on the ground that, in section 13(c), Congress defined its concept of labor dispute in terms that no longer leave room for doubt. United States v. Hutcheson, 312 U.S. 219, 234, 61 S.Ct. 463, 467, 85 L.Ed. 788. 9 Section 13(c) of the Norris-LaGuardia Act defines labor dispute as any controversy concerning terms or conditions of employment, or concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer and employee. The AGCC's alleged conspiracy to persuade others not to deal with subcontractors who signed with the Unions might be said to fall within section 13(c)'s broad definition of labor dispute, as either a dispute concerning terms or conditions of employment or one concerning the association or representation of persons in negotiating terms or conditions of employment. The Supreme Court, however, has refused to apply section 20 to exempt anticompetitive conduct involving employer groups, even though the conduct, which also involved labor unions, might have been said to arise out of a labor dispute as defined in the Norris-LaGuardia Act. In Allen Bradley Co. v. Local 3, Int'l Brotherhood of Electrical Workers, 325 U.S. 797, 65 S.Ct. 1533, 89 L.Ed. 1939 (1945), the Court held that a union and an employer group that conspired to restrain trade were guilty of violating the antitrust laws even though the conspiracy developed from a labor dispute between the union and the employer group. Although the Court noted that the union's conduct fell squarely within the specified acts declared by the Clayton and Norris-LaGuardia Acts not to be violations of federal law, 325 U.S. at 807, 65 S.Ct. at 1538-1539, the Court declared that the purpose of the antitrust laws was to outlaw business monopolies and that (a) business monopoly is no less such because a union participates  Id., 325 U.S. at 811, 65 S.Ct. at 1540. 10 The Court further explained that: 25 The primary objective of all the Anti-trust legislation has been to preserve business competition and to proscribe business monopoly. It would be a surprising thing if Congress, in order to prevent a misapplication of that legislation to labor unions, had bestowed upon such unions complete and unreviewable authority to aid business groups to frustrate its primary objective. For if business groups, by combining with labor unions, can fix prices and divide up markets, it was little more than a futile gesture for Congress to prohibit price fixing by business groups themselves. 26 325 U.S. at 809-810, 65 S.Ct. at 1540. 27 To summarize: In the context of a labor dispute, section 20 of the Clayton Act and section 4 of the Norris-LaGuardia Act, which were primarily designed to promote labor organization, exempt from the antitrust laws anticompetitive conduct on the part of labor unions acting alone. The statutory exemption embodied in those acts has not, however, been extended to immunize anticompetitive conduct involving unions and businessmen acting together, even where such conduct might promote labor organization, because such an extension would effectively negate the prohibitions against anticompetitive business conduct contained in the antitrust laws. A fortiori, if the statutory exemption is inapplicable to business group conspiracies involving unions, the exemption cannot be read to immunize anticompetitive conduct on the part of employers acting alone. 28 In United States v. United Mine Workers of America, 330 U.S. 258, 67 S.Ct. 677, 91 L.Ed. 884 (1947), the Court also explained that since the restrictions on injunctions found in the Clayton Act are less comprehensive than those found in the later-enacted Norris-LaGuardia Act, the Clayton Act does not deprive federal courts of jurisdiction to grant injunctive relief in any case in which they are not specifically deprived of such jurisdiction under the Norris-LaGuardia Act. 11 In short, the Norris-LaGuardia Act limits the injunctive powers of federal courts to a greater extent than does the Clayton Act, rendering superfluous the Clayton Act's limits on the injunctive powers of federal courts' and the concomitant limits on the scope of the statutory exemption. 29 The situations in which federal courts are deprived of jurisdiction to issue injunctions in labor disputes under the Norris-LaGuardia Act are listed in the footnote. 12 Since the AGCC's alleged conduct does not fit within any of the categories therein listed, such conduct is not non-enjoinable and therefore the AGCC may not claim the benefit of the statutory antitrust exemption. 13 30 Our determination that the AGCC cannot benefit from the statutory exemption embodied in the Norris-LaGuardia Act and section 20 of the Clayton Act is further supported by the purposes for which those acts were passed. Before the passage of those acts, employers frequently sought injunctions to frustrate labor unions' organizational drives. That the limitations on the federal injunctive power embodied in these acts were designed primarily to promote the organization of labor unions is well illustrated by the policy statement found in section 2 of the Norris-LaGuardia Act: 31 Whereas under prevailing economic conditions, the individual unorganized worker is commonly helpless to exercise actual liberty of contract and to protect his freedom of labor, and thereby to obtain acceptable terms and conditions of employment, wherefore it is necessary that he have full freedom of association, self-organization, and designation of representatives of his own choosing and that he shall be free from the interference, restraint, or coercion of employers of labor, or their agents, in the designation of such representatives or in self-organization ; therefore, the following definitions of and limitations upon the jurisdiction and authority of the courts of the United States are enacted. 32 29 U.S.C. § 102. Thus the statutory exemption may not be construed to exempt a conspiracy of employers to destroy a particular union through a boycott of union-signatory subcontractors because such conduct is completely antagonistic to the pro-labor purposes for which the acts containing the labor exemption were enacted.