Court Opinion

ID: 9419688
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:51:02.88796+00
Date Added: 2024-06-11T17:19:26.795254
License: Public Domain

Me. Justice Muephy,
dissenting.
I
If it were made clear by the undisputed facts that, by adopting their by-laws, the members of the Associated *50Press were engaged in a program to hamper or destroy competition, I could accept the decision reached by the Court. But the evidence introduced, in my opinion, falls far short of proving such a program and hence the decision has grave implications relative to governmental restraints on a free press.
As I view the situation, the members of the Associated Press were entirely within their legal rights in forming a cooperative organization with facilities for the collection and exchange of news and in limiting the membership therein. Members of an incorporated society, as a general rule, may extend the privilege of membership or withhold it on such terms as they see fit. And if exclusive access to these facilities and reports gave the members of the Associated Press a competitive advantage over business rivals who were not members, that alone would not make the advantage unlawful. In restricting the admission of business rivals they were merely trying to preserve for themselves an advantage that had accrued to them from the exercise of business sagacity and foresight. Such an advantage, as I see it, is not a violation of the Sherman Act. Nor does this advantage require the Associated Press to share its products with competitors. Such a doctrine would discourage competitive enterprise and would carry the anti-trust laws to absurd lengths. In the words of the court below, “a combination may be within its rights, although it operates to the prejudice of outsiders whom it excludes.” 52 F. Supp. 362, 369.
Thus for the first time the Court today uses the Sherman Act to outlaw a reasonable competitive advantage gained without the benefit of any of the evils that Congress had in mind when it enacted this statute. On the main issue before us, the record shows a complete absence of any monopoly, domination, price fixing, coercion or other predatory practices by which competition is eliminated to the injury of the public interest. Apex Hosiery Co. v. Leader, *51310 U. S. 469, 491-501. And the District Court was unable to find otherwise. Nothing appears save a large, successful organization which has attempted to protect the fruits of its own enterprise from use by competitors. To conclude on such evidence that the Associated Press has violated the Sherman Act is to ignore the repeated holdings of this Court that the purpose of the statute is to maintain free competition in interstate commerce and to eliminate only those restraints that unreasonably inhibit such competition.
II
Today is also the first time that the Sherman Act has been used as a vehicle for affirmative intervention by the Government in the realm of dissemination of information. As the Government states, this is an attempt to remove “barriers erected by private combination against access to reports of world news.” That newspapers and news agencies are engaged in business for profit is beyond dispute. And it is undeniable that the Associated Press and other press associations can claim no immunity from the application of the general laws or of the Sherman Act in particular. Associated Press v. Labor Board, 301 U. S. 103, 132-133. But at the same time it is clear that they are engaged in collecting and distributing news and information rather than in manufacturing automobiles, aluminum or gasoline. We cannot avoid that fact. Nor can we escape the fact that governmental action directly aimed at the methods or conditions of such collection or distribution is an interference with the press, however differing in degree it may be from governmental restraints 'Oil written or spoken utterances themselves.
The tragic history of recent years demonstrates far too well how despotic governments may interfere with the press and other means of communication in their efforts to corrüpt public opinion and to destroy individual free*52dom. Experience teaches us to hesitate before creating a precedent in which might lurk even the slightest justification for such interference by the Government in these matters. Proof of the justification and need for the use of the Sherman Act to liberate and remove unreasonable impediments from the channels of news distribution should therefore be clear and unmistakable. Only then can the precedent avoid being a dangerous one authorizing the use of the Sherman Act for unjustified governmental interference with the distribution of information.
This does not mean that the Associated Press is entitled to any preferential treatment under the Sherman Act or that the Government must meet any higher degree of proof of a statutory violation when dealing with the press than when dealing with any other field of commercial endeavor. Clear and unmistakable proof of a Sherman Act violation, especially where a summary judgment procedure is followed, is necessary in any case. And failure to insist upon compliance with that standard of proof is unwise under any circumstances. But such a failure has unusually dangerous implications when it appears with reference to an alleged violation of the Act by those who collect and distribute information. We should therefore be particularly vigilant in reviewing a case of this nature, a vigilance that apparently is not shared by the Court today.
As applied to the Sherman Act, this means that an allegation by the Government that a monopoly or restraint of trade exists in the business of collecting and distributing information should be proved by clear evidence after a full canvass of all the pertinent facts. Nothing should be left to speculation, doubt or surmise. Nor can conjectures as to probabilities or inevitable consequences replace proof of .the actual or potential existence of monopolies or restraints. In other words, before the Government is entitled to enjoin a combination or conspiracy alleged to be *53in restraint of news dissemination it must be shown by competent evidence that such combination or conspiracy has in fact resulted in restraints or will inevitably produce actual restraints in the future. Full opportunity should be accorded the parties to cross-examine and rebut all the evidence adduced on both sides of the litigation. Such would be the requirements in any suit under the Sherman Act against those who sell food, steel or furniture, and no cogent reason is apparent for applying less stringent requirements when dealing with the business of the press. Indeed, the very nature of the newspaper business is a compelling reason for a strict adherence to these requirements. Any possible use of the Sherman Act as a ready vehicle for unjustified governmental interference in the dissemination of news is thus avoided by insistence upon these elemental standards of proof and fairness of procedure. The actual and potential dangers in any such interference greatly outweigh any public interest in destroying’an abandoned, ineffective or abortive scheme that appears at first glance to restrain competition among newspapers.
Accordingly I am unable to agree that this case should be disposed of in favor of the Government on a motion for summary judgment. The issues are too grave and the possible consequences are too uncertain not to require the Government to prove its case by more probative and convincing evidence than it has submitted so far. The admitted facts are either inconclusive or definitely lean in favor of the contentions of the Associated Press. These admitted facts, in my estimation, do not constitute such clear evidence of an alleged restraint of trade as to justify the proposed interference by the Government in the Associated Press membership rules which underlie the distribution of Associated Press dispatches. They do not justify the conclusion that the Associated Press by-laws on their face, and without regard to their past effect, will “necessarily” result in unlawful restraints. It may well be that *54these by-laws will restrain trade and ought to be enjoined but I am unwilling to reach that conclusion without requiring the parties and the court below to examine the facts more thoroughly, having in mind the dangerous implications inherent in this situation and the clarity of proof that the Government should present.
Ill
The nub of the complaint against the Associated Press is that its by-laws (1) allow discrimination in the condition of admission based upon the factor of an applicant’s competition with a present member, and (2) enforce such discriminatory exclusion through a non-trading agreement among members, an agreement which the court below found to be reasonable when considered separately. In other words, these by-law provisions are said to constitute a combination for the purpose of excluding competitors from that part of the market within the scope of the agreement and hence be an unreasonable restraint of trade within the well-settled meaning of the Sherman Act.
It may be conceded that these by-law provisions on their face are restrictive in nature and that their natural effect is to exclude outside newspapers from the benefits of Associated Press membership. But that concession does not prove that these provisions are necessarily so unreasonable in nature as to be a restraint of the type clearly condemned by the Act. They may be regarded on this record as nothing more than the exercise of a trader’s right arbitrarily to choose his own associates and to protect the fruits of his own enterprise from use by competitors. United States v. Colgate & Co., 250 U. S. 300, 307; International News Service v. Associated Press, 248 U. S. 215, 235. Any frustration of competition that might result from such an exercise is a normal incident of trade in a competitive economy, a lawful objective of business enterprise. Certainly the Sherman Act was not designed to discourage men from *55combining their talents and resources in order to outdo their rivals by producing better goods and services. It was meant to foster rather than to thwart or punish successful competition. Competitive practices emerge as unreasonable restraints of trade only if they are infused with an additional element of unfairness, such as monopoly, domination, coercion, price fixing or an unreasonable stifling of competition. If there is such a factor in this instance, however, it lies deep in the unfathomed sea of conflicting or unproved facts.
If it were true that the Associated Press monopolizes or dominates the newspaper field, these by-law provisions might be found to be unreasonable restraints of trade. Then the unfairness of excluding outside newspapers because of their competition would be manifest. See United States v. Terminal Railroad Assn., 224 U. S. 383. But the Government makes no such claim. In fact, the District Court specifically found no evidence of monopoly or domination by the Associated Press in the collection or distribution of news, the means of transmitting the news, or the access to the original sources of the news. A brisk rivalry with the United Press and the International News Service is recognized in these matters. Associated Press thus has no power, through the use of its by-laws or because of its size, to exclude non-members from receiving or obtaining news reports. In this respect there is no basis for concluding that the by-laws will “necessarily” restrain trade.
A point is made of the fact, however, that the Associated Press is the largest of the news agencies, ranking “in the forefront in public reputation and esteem” and constituting “the chief single source of news for the American press, universally agreed to be of great consequence.” A unique value is said to attach to Associated Press news reports, growing out of the fact that they are furnished by an agency composed of and controlled by newspapers representing nearly every shade of opinion and geographical *56section of the nation. These characteristics are claimed to furnish an invaluable guaranty that the news will be presented by Associated Press with a minimum of political and sectional bias. The great size and extent of the Associated Press facilities are also said to lend a uniqueness to its reports.
But there is no evidence in the present state of the record that these factors, if they exist, make the Associated Press reports so superior to those of its rival agencies as to clothe Associated Press reports in the robes of indispensability or that competition by non-members is hindered or restrained unnecessarily. Perhaps the Government has evidence to that effect which should be introduced. In the absence of such evidence, however, neither the policy nor the language of the Sherman Act penalizes those who, by their enterprise and sagacity, have formed a news service of the first rank and of unique value in the eyes of a considerable portion of the public. A cooperative organization, un-tinged with any monopolistic or other objectionable hue, is free to exceed its competitors in size and excellence without losing its right to choose its members and to protect its own unique products from the use of others.
If it were shown that the Associated Press, through its by-laws, has stifled or is inevitably bound to stifle competition by non-member newspapers in an unreasonable manner, so as to injure the public interest, a violation of the Sherman Act would be beyond dispute. This appears to be the primary basis for the result reached by the Court today, for it states that inability to buy news from the Associated Press “can have” most serious effects on competing newspapers and that they are “more than likely” to be at a competitive disadvantage. But even if competitive disadvantage, under some circumstances, is sufficient to prove an unreasonable stifling of competition, the Government has as yet produced no evidence to support the existence or the likelihood of such a disadvantage.
*57On the contrary, the evidence submitted by the Associated Press and accepted as true by the District Court demonstrates that many newspapers have flourished without Associated Press service and have successfully competed with Associated Press members. These proofs also indicate that numerous papers actually prefer the services of other news agencies to that of Associated Press; several of them having actually dropped their Associated Press membership and become members of one of the other news associations. Moreover, there is a complete lack of any relevant proof justifying the conclusion that the Associated Press membership policy has prevented or hindered the birth of a competing newspaper, prevented or hindered the successful operation of one, or caused one to be discontinued.
Nor does it appear from the record that any appreciable segment of the public has been unduly deprived of access to world news through inability to read Associated Press dispatches in non-member newspapers. Indeed, the very presence of Associated Press newspapers in cities where there are competing non-members would seem to assure the public of Associated Press news at a small cost. The wide-spread service of the Associated Press, covering both towns with and without competing services, is to that extent a guarantee of adequate access to its dispatches.
It is conceivable, of course, that these by-laws “can have” adverse effects upon competition and upon the public. But something more than a bare possibility should be required before we are justified in sanctioning interference by the Government with the private dissemination of information. There should be clear proof here not only of a competitive advantage but also of some unfair use of any competitive advantage that the Associated Press may possess or proof that it is acting so as to stifle competition unreasonably. Evidence of this nature, moreover, unless it is undisputed, should be thoroughly tested in the cruei-*58ble of cross-examination and counter-evidence. An issue of this nature deserves more than a summary disposition.
Thus if it were shown that the Associated Press was using its by-laws to fix prices for news reports or to coerce non-member newspapers in some way, a clear violation of the Sherman Act would be proved. Under certain circumstances these by-laws conceivably might be employed for the purpose of coercing the non-members to join the Associated Press, to refrain from obtaining news from other sources or to cease operations. But no attempt has been made by the Government to allege or prove such facts and their existence cannot be assumed any more than we can presuppose unfair destruction of competition in order to justify the decree of the court below.
At the same time, however, most of the cases cited in support of the result reached by the Court today are relevant only to a situation where there is some element of coercion or unfairness present. Thus the combination in Montague & Co. v. Lowry, 193 U. S. 38, was designed to force non-members to join as the price of being able “to transact their business as they had theretofore done.” In Standard Sanitary Mfg. Co. v. United States, 226 U. S. 20, a combination was formed to prohibit sales to non-member jobbers, thereby tending to force them to join. In Eastern States Lumber Dealers’ Assn. v. United States, 234 U. S. 600, retailers combined and refused to buy from wholesalers who sold directly to consumers, as a result of which the wholesalers wer.e compelled to cease selling at retail. The combination in Fashion Originators’ Guild v. Federal Trade Commission, 312 U. S. 457, organized a boycott against those who refused to comply with its program, thus narrowing the market and forcing them to cease pirating designs. Finally, the combination in United States v. Crescent Amusement Co., 323 U. S. 173, used its buying power to eliminate competition with exhibitors and to acquire a monopoly in the areas in question.
*59There is thus no direct or authoritative precedent guiding our decision in this case. None of the foregoing cases or any other that could be cited justifies us in sanctioning the application of the Sherman Act on an unproved assumption that a particular combination will “necessarily” and illegally restrain competition in the face of overwhelming evidence to the contrary. Nor are any of these cases authority for deciding a Sherman Act case on a motion for summary judgment where serious doubts exist as to the alleged unreasonableness of the restraint of trade. No case, moreover, bids us to sanction an application of the Sherman Act to the business of gathering and distributing news with our eyes closed to the inevitable implications and hazards.
We stand at the threshold of a previously unopened door. We should pause long before opening it, lest the path be made clear for dangerous governmental interference in the future. A decree of the type present in this case is not of necessity an undue interference by the Government. If it were supported by facts, it would be a reasonable and justifiable method of liberating non-member newspapers from the alleged coercive yoke of the Associated Press and of assuring the public of full access to the news of the world. But the danger lies in approving such a decree without insisting upon more proof than yet produced by the Government. If unsupported assumptions and conjectures as to the public interest and competition among newspapers are to warrant a relatively mild decree such as this one, they will also sustain unjust and more drastic measures. The blueprint will then have been drawn for the use of the despot of tomorrow.
Since I am of the opinion that the judgment should be reversed and the cause remanded to the District Court for further consideration in light of the principles I have mentioned, I do not deem it necessary to comment in detail on the other parts of the decree discussed by the Court. *60At the same time, however, it seems only fair to state that on the facts presented it is difficult to see any justification for the agreement whereby Associated Press is given the exclusive right to Canadian Press news reports in the United States. Associated Press is thereby given an outright monopoly of the only available comprehensive news coverage of a great nation, no comparable substitute being available. The only other matter remaining in doubt is the by-law restriction which prevents the Associated Press members from making their spontaneous local news available to non-members and to rival news agencies. The lower court appears to have thought this provision reasonable when considered apart from the membership restriction. On the present state of the record I am not prepared to disagree although I am inclined to believe that this provision may well be shown to be unreasonable.