Document: 44 L.Ed.2d 572 95 S.Ct. 2004 421 U.S. 773 Lewis H. GOLDFARB et al., Petitioners,v.VIRGINIA STATE BAR al. No. 74—70. Argued March 25, 1975. Decided June 16, Rehearing Denied Oct. 6, See 423 886, 96 162. Syllabus Petitioners, husband and wife, contracted to buy a home in Fairfax County, Va., the lender who financed purchase required them obtain title insurance, which necessitated examination that could be performed legally only by member of respondent Virginia State Bar. Petitioners unsuccessfully tried find lawyer would examine for less than fee prescribed minimum-fee schedule published County Bar Association enforced then brought this class action against respondents, seeking injunctive relief damages, alleging its enforcement mechanism, as applied fees legal services relating residential real estate transactions, constitute price fixing violation § 1 Sherman Act. Although holding was exempt from Act, District Court granted judgment enjoined publication schedule. The Appeals reversed, not Bar's actions were immune liability 'state action,' Parker v. Brown, 317 341, 63 307, 87 L.Ed. 315 but also because practice law, 'learned profession,' is 'trade or commerce' under Act; that, any event, respondents' activities did have sufficient effect on interstate commerce support Act jurisdiction. Held: schedule, Bar, violates Pp. 780-793. (a) mechanism since record shows rather being purely advisory, operated fixed, rigid floor. through prospect professional discipline reason attorneys' desire comply with announced norms, assurance other lawyers compete underbidding. 781-783. (b) Since significant amount funds furnished financing homes comes outside State, an integral part such sufficiently affected purposes notwithstanding there no showing prospective purchasers discouraged buying challenged activities, scheduled resulted raising fees. 783-785. (c) Congress intend sweeping profession' exclusion service, exchange service money 'commerce' common usage term. 785-788. (d) Respondents' are action' within meaning supra. Neither Supreme nor statute and, although has power issue ethical opinions, it does appear approves them. It enough anticompetitive conduct 'prompted' state action; exempt, must compelled direction acting sovereign. Here providing deviation minimum may lead disciplinary action, voluntarily joined what essentially private activity hence cannot claim beyond Act's reach. 788-792. 497 F.2d 1, reversed remanded. Alan B. Morrison, Washington, D.C., petitioners. Sol. Gen. Robert Bork, U.S., amicus curiae, special leave Court. T. Booker, Richmond, Ass'n. Andrew P. Miller, Va. Mr. Chief Justice BURGER delivered opinion We certiorari decide whether 26 Stat. 209, amended, 15 U.S.C. 1. held substantially restrained competition among lawyers, scope law commerce,' defined (1943). 2 * In 1971 petitioners, agency secure insurance; examination, perform service.1 therefore contacted quoted precise suggested Association; told his policy keep charges line provided 1% value property involved. fixed They sent letters 36 requesting their Nineteen replied, none indicated he charge rate schedule; several stated they knew attorney do so. 3 referred list recommended prices services. Respondent although, voluntary association attorneys, formal enforce it. Enforcement been administrative agency2 regulates State; membership order Virginia.3 never taken compel adherence reports4 condoning schedules, issued two opinions5 indicating schedules ignored. most recent states 'evidence habitually adopted local bar Association, raises presumption guilty misconduct . ..'6 4 Because petitioners willing lower dictated, had examined first contacted. Bar7 operation constitutes sought both damages. 5 After trial solely violated Act.8 355 F.Supp. 491 (ED (1973). court viewed fee-schedule system petitioners' failure fee, rejected contention 6 Both respondents argued action. agreed doctrine Court, more important, 'minor role matter derived judicial 'legislative command intended operate become effective without command." hand, organization compulsion adopt chose own course antitrust laws 'remain full force it.' 26, set case down ascertain 15. 7 liability. (CA4 1974). Despite conclusion 'is abundantly clear before us supporting act substantial restraint upon attorneys practicing County,' id., at 13, supra, There long recognition limited professions' laws, said; based form regulation imposed professions States, incompatibility certain competitive practices prefessional regulation. concluded promulgation one 'those matters respect accord reached between necessities dictates laws.' hold laws. 8 Alternatively, business insuring mortgages inflating component total cost housing, generally even where transaction crosses lines 'incidental,' justify federal 9 certiorari, 419 963, 223, 42 178 (1974), thus confronted time question applies examining titles connection estate. II 10 Our inquiry can divided into four steps: engage fixing? If so, affect commerce? involve profession?' not, (1943), Act? 11 argues merely fixing. Its purpose, argument continues, provide legitimate information aid complying regulations. Moreover, contends producing facts found trier belie these contentions, nothing suggests findings lack support. 12 A advisory guidelines, actual trade, present different question, e.g., American Column Co. United 257 377, 114, 66 284 (1921); Maple Flooring Assn. 268 563, 580, 45 578, 584, 69 1093 (1925). But see States National Real Estate Boards, 339 485, 488—489, 495, 70 711, 713—714, 717, 94 1007 (1950). here, however, reveals situation quite occur floor arose activities: every responded inquiries adhered asked additional individualized fee. disseminated concern past standards, cf. Cement Mfrs. Protective Ass'n 588, 586, 1104 (1925), charged future those rates increased over time. Co., 411,42 121; motivation conform reinforced This agreement inferred information, Container Corp., 393 333, 337, 89 510, 512, 21 526 (1969), here naked clearly shown, plain.9 Id., 339, 513 (Fortas, J., concurring). 13 terms restraining harming consumers like price-fixing unusually damaging. indispensable process purchase, licensed title, n. turn alternative sources necessary service. All course, constraint 512. makes much fact organization; opinions lawyer, county association, disciplined 'habitually charg(ing) ..' 777-778, 4. These factors coalesced create pricing realistically escape. On classic illustration B 14 argues, held, caused schedule's incidental remote. view services, wholly intrastate, nature commerce. Further, maintains, fees, if increase deterred homeowner County. arguments misconceive transactions place play transactions. As found,10 'a portion purchasing Virginia,' 'significant amounts loans guaranteed Veterans Administration Department Housing Urban Development headquartered Columbia.' Thus need particular frequently trade because, practical sense,11 examinations assure lien valid borrower. realty purchases lenders require, 'as condition making loan, involved ..'12 transaction13 16 'there obvious distinction drawn inseparable element larger program dependent success affects states.' Frankfort Distilleries, 324 293, 297, 65 661, 663, 951 (1945). 17 Yellow Cab 332 218, 228—229, 67 1560, 1566, 91 2010 (1947). 18 Given volume involved,14 inseparability aspects we conclude affected. Montague & Lowry, 193 38, 45—46, i4 309, 48 608 (1904); Women's Sportswear Assn., 336 460, 464—465, 714, 716, 93 805 (1949). 19 buyers mean Otherwise, magnitude control, our cases shown once specific proved. E.g., McKesson Robbins, Inc., 351 305, 310, 76 937, 940, 100 1209 (1956). Nor prove raised proved 'deprive(d) advantages derive competition.' Apex Hosiery Leader, 310 469, 501, 60 982, 996, 84 1311 (1940). Socony-Vacuum Oil 150, 811, 1129 20 Where, necessity, transaction, purposes. Of fashions, just nexus reach C include learned Act,15 sale No explicit exemption legislative history contention; rather, existence seems primary basis. Also, maintains inconsistent profession enhancing profit goal activities; community.16 That, indeed, basis traditionally advanced distinguish trades, businesses, occupations, loses some when used control here. 22 arguing seeks Whether active dormant, theoretical, able impunity. proposition exclusion. occupation, standing alone, sanctuary Associated Press 326 7, 1416, 1418, 2013 (1945), public-service aspect controlling determining includes professions. 489, S.Ct., 714. strike broadly read so wide urged odds purpose. 23 language contains exception. 'Language comprehensive difficult conceive.' South-Eastern Underwriters 322 533, 553, 64 1162, 1174, 88 1440 (1944). And repeatedly established heavy implicit exemptions, Philadelphia Bank, 374 321, 350—351, 83 1715, 1734—1735, 915 (1963); California FPC, 369 482, 82 901, 904, 54 (1962). Indeed, specifically included Medical 519, 326, 434 (1943); Radovich Football League, 352 445, 77 390, 456 (1957). Whatever else be, land service; word. disparagement acknowledge aspect,17 24 '(o)n face carefully studied attempt bring person engaged whose might restrain monopolize commercial intercourse 1174. 25 modern world denied important intercourse, exert D marketing 'derived authority efficacy state' regulate prohibit imposing government. 350—352, 313; Olsen Smith, 195 332, 344—345, 52, 54, 55, 49 224 (1904). seek avail themselves so-called state-action exemption. 27 Through legislature authorized highest law.18 That codes deal far exercising authorize binding fixing, explicitly directed 'to controlled' schedules.19 law,20 issuing reports dealing implementing provisions codes. agency, claims actions, too, 28 threshold type meant proscribe 313—314; Continental Ore Union Carbide, 370 690, 706—707, 1404, 1414—1415, 777 inquire further fairly said Rules either respondent. Respondents pointed requiring simply refer leaving Court; Court's mention direct supply them, require activities. apparently indication opinions. arguments, most, complemented objective puts it, 29 shield allows foster benefit members.21 Cf. Gibson Berryhill, 411 564, 578—579, 1689, 1698, 488 activity, posture Act.22 351—352, 313—314. consumers, escape wished borrow home. III 30 recognize compelling interest boundaries, protect public health, safety, interests broad establish standards licensing practitioners regulating instances 'forms usual demoralizing profession.' Oregon Society, 343 336, 72 697, 978 (1952). Semler Board Dental Examiners, 294 608, 611—613, 55 570, 571—572, 79 1086 (1935). especially great essential governmental function administering justice, historically 'officers courts.' Sperry Florida ex rel. 373 379, 383, 1322, 1325, 428 Cohen Hurley, 366 117, 123 124, 81 954, 958, 156 (1961); Law Students Research Council Wadmond, 401 154, 157, 720, 723, 749 (1971). diminution 31 remanded orders remand proceedings consistent opinion. 32 Reversed 33 POWELL took consideration decision case. Unauthorized Practice Law, Opinion 17, Aug. 5, 1942, Bar—Opinions 239 (1965). Code Ann. 54—49 (1972) provides: 'The may, time, prescribe, adopt, promulgate amend rules regulations organizing governing known composed purpose investigating reporting article competent jurisdiction necessary, all persons members thereof good standing.' Ibid. 1962 minimum-fee-schedule-report listed series 'represent considered Committee (on Economics Practice) fair each instance.' report stated, mandatory, consider adopting Nevertheless, shortly thereafter purported conscientious effort show true perspective dignity, training integrity.' virtually identical report. 98 Legal Ethics duty deserving case, "purely advancement, intentionally regularly bills customary similar (in to) resulting personal gain, becomes solicitation contrary Canon forbids efforts encroach employment another." App. 30. 1969 second candidly 'reflect(ed) general scaling up services.' again bound recommendations; quickly moved publish updated raise new tempered referring 98. should feel free fees; avoid condemnation higher cautioned publicly criticize herein itself evidence Ethics, 98, 1960; 170, May 28, 1971. parties stipulated influencing factor lawyers' schedules. One 'investigat(e) (Virginia Court) Va.Code (1972). Therefore contemplated ignoring aware sanctions possible, existed administer Two associations originally named defendants consent cancel existing adopting, publishing, distributing Damage dismissed prejudice. satisfied sustain insurance Virginia. 491, Va.1973). accurately depicted situation: '(I)t nearly (County Bar) equal exceeding forth involving estate.' "A inability (petitioners) Minimum Fee Schedule system." 'It County.' 13. disturb fact. disagreed conclusions therefrom. sense commerce, Swift 196 375, 398, 276, 280, 518 (1905); Mandeville Island Farms, Inc. Crystal Sugar 334 219, 233, 68 1004, 92 1328 (1948). F.Supp., 494. relies (1947), 'essentially local' inter alia, intrastate taxi trips occurred start finish rail travel 'too unrelated Act.' 230, 1567. ride railway station, said, '(f) rom standpoints continuity distinct separate journey.' 232, Here, contrary, coincidental essential. apt compare trip stations change trains midst journey. stream 1566. 497. cites phrases implied Federal Club 259 200, 465, 466, 898 (1922) ('a firm sending out argue goes another State'); FTC Raladam 283 643, 653, 51 587, 592, 75 1324 (1931) ('medical follow .'); Atlantic Cleaners Dyers 286 427, 436, 52 607, 610, 1204 (1932); 490, 715, citations passing references concerned issues; until attempted falls still open, 492, done earlier 528, 328, altruistic. sentence Report states: "The slowly, surely, committing economic suicide profession." 1962, p. 3, 20. operates distinguished is, relevant unrealistic interchangeable automatically apply concepts originated areas. aspect, features professions, practice, properly context, treated differently. intimate today. 54—48 'Rules defining prescribing ethics procedure.—The regulations: '(a) Defining law. '(b) Prescribing code ethics. '(c) procedure disciplining, suspending, disbarring law.' addition, Virginia, inherent State. Button Day, 204 547, 132 S.E.2d 292 (1963). Lathrop Donohue, 367 820, 1826, 1191 (1961). 1938 Integration Rule II, 12, dealt setting Among six 'the '(i)n proper permit himself controlled thereby sole guide fee.' 171 xvii, xxiii. (Emphasis supplied.) 1970 amended part, Professional Responsibility, January 211 295 (1970). Certain fee-setting procedure. EC 2—18 vary according many factors, '(s)uggested guidance subject reasonable fees.' 302. DR 2—106(B), detailed eight avoiding excessive '(t)he customarily locality 2—106(B) (3). 313. 766 2. acted role' concerned, 496, panel prepared exonerate participation minimal insufficient impose F.2d, (Craven, concuring dissenting). alleged participant insubstantial found, 717; impetus occasions, More Those threatened habitual disregard livelihood jeopardy Even threat constituted adhere expected discredit departing perhaps betraying oaths. protected Eleventh Amendment. Edelman Jordan, 415 651, 1347, 39 662 (1974). dispute contention, occasion holding. issue, remand.

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