HARDWOOD RECORD 



.T.inuary In. l*ii> 



Grave disappointment that the Supreme Court ruling in the hard- 

 Avood case ''does not settle anything'' is expressed by L. C Boyle, 

 counsel tor the American Hardwood Manufacturers' Association, in 

 a statement issued on December 22 to R. M. Carrier^ president of the 

 association, nnd members of the * * open competition plan." This 

 statement followed a special statement wired to Hardwood Record 

 directly after the decision was handed down. It was made too late 

 for publication in the issue of December 2i) along with the first 

 statement. 



The hardwood case was regarded as a test case and counsel for 

 the defendants, and, in fact, business in general had expected that 

 the decision would lay down a code of association practices which 

 would serve as a guide to all trade associations in statistical work. 

 But the decision merely affirmed the sweeping injunction of the 

 court in whieli the case originated. It made no attempt to analyze 

 the merits and demerits of the various parts of the plan complained 

 of, but without discrimination condemned all as being a conspiracy 

 in restraint of trade. "No yardstick was laid down whereby other 

 groups may find guidance,' ' said Gen. Boyle. Tlie prosecuting 

 counsel, and finally the decision of the Supreme C-ourt. had indicated 

 that the gatliering of stock and sales statistics was not in an4i of 

 itself illegal, but that the illegality lay in their interpretation 

 through market letters. The defendants had hoped to be advised 

 whether such reports might be continued provided no attempt was 

 made to intcrjiret them, everyone concerned being left to draw his 

 own conclusions. But the decision, according to General Boyle, 

 failed to make tliis cb'ar. 



He is hoficful that the application for a rt-hearing of the case, 

 upon which he lias determined, may elicit from tlic court something 

 definite as to the legal limitations of trade associations. 



In his statement General Boyie indicates that the appeal for a 

 rehearing will be predicated upon the court's apparent failure to 

 consider the fact that the record does not show any curtailment of 

 production l)y agreement but does show that the Government prose- 

 cutors abandoned this contention at the outset of the case. 

 Text of Statement 



The statement in full is as follows: 



You have heen iidvise4l that the Supreme T'ourt hehl against us touching 

 the legality of our open competition plan. It is my present purpose to more 

 definitely advise you as to the court's decision. 



The majority opinion was deliverefl by .lustice riarke. Three justices 

 dissented, to-wit : Justices Brandeis, IToInn's nnd McK^-nna. .Tnstires Bran- 

 (leis and II<>lines fih'd written opinions. 



The majority npinion a<kii)ls the theory as outlined liy the (Jovernmeut 

 in its briefs. It would be an idb' tiling for me at this time to quarrel with 

 the opinion. That the majority of the court has reached an erroneous con- 

 clusion is to me manifest. In the nature of things that would be my 

 natural reaction. The great and disappointing thing to me, however, is 

 that the decision does not settle anything. It is true the court holds that 

 this group of hardwood lumber manufacturers were in a conspiracy to 

 restrain trade. However, no ynrdsticl^ is laid down whereby other groups 

 may find guidance. The great and outstanding thing that we urged the 

 court to decide, To wit: Would it be lawful to gather and distribute statis- 

 tics covering records of past sales, stocks on hand and production, is left in 

 a confuseil and doubtful position. In a word, the court assembles all of 

 the activities in which our group indulged, to wit: 



The publication of the market letter: the distributi<)n of the (piestion- 

 naire; the collection of sales and stock data; the holding of monthly meet- 

 ings: and holds that these things comprehend the conspiracy: whereas, it 

 was our earnest appeal to the court to indicate what would lie legal touch- 

 ing any of these activities as distinguished from what might be illegal as to 

 any of theni. 



There is language in the decision that would indicate that our conduct 

 might have been held legal had we not indulged in certain activities. In 

 other words, if all we did was to collect statistics and distriluite same, such 

 c(»urse might not have been held illegal. 



However, this vital element is left undecided and uncertain. There still 

 remains an opportunity to have this question further considered by the 

 Supreme Court. The rules of the court permit the filing of a petition for 

 a rehearing during the term in which a decision is handed d<iwn. Therefore 



we will have opportunity to challenge to the court's attention matters of 

 fact and law wherein it will be pointed out the fipinion is in error. 



Court Sustained Abandoned Charge 

 It may be of inreresl to hear and in a very iMicf way call attention to cer- 

 tain of those items: It will be noted that the opinion adopts the <iovern- 

 ment's charge that the plan was designed to and did achieve curtailment 

 of production, whereas counsel representing the (Jovernment in the first 

 oral argument frankly admittetl to the court that there was no evidence 

 in support of the charge of curtailment and in the Government's original 

 brief this phase of the Government's charge is formally abandoned. Of 

 course, the Government was driven to this position due to the unquestioned 

 state of the record; neverth<dess, the court's opinion is largely devoted to 

 this curtailment phase and the conclusion is definitely nssertetl that as a 

 [tart of the conspiracy curtailment of production was involveti. 



1 can not help but feel that when the court's attention is delinitely 

 called to Its error of conclusion as to this all important item the petition to 

 rehear will be granted. Again, the Government in its original oral argu- 

 ment formally ailmitted that it wcnild not be illegal for a group of opera- 

 tors to gather and disseminate statistical information when the same was 

 done solely for infonnative purposes. I)ue to this admission, Mr. Todd and 

 myself were justified in concluding that the court would at least recognize 

 our right to gather and disseminate statistics when same was not done as a 

 means f<tr carrying out some kind of an illegal compact. However, as the 

 court's opinion stands it is difficult to determine whether we would be per- 

 mitted to do this very thing and if it be the law that this woiild be permit- 

 ted then the injunction of the lower court should be modified, whereas the 

 lower court's injunction is sustained in all respects. 



One reading this opinion, and who is a stranger to the record, would 

 unquestionably get impressions that are not justified by the record itself. 

 and it is just possilile that the true state of this record has escapt^I the 

 court. To illustrate: In outlining the activities of the association the 

 court reviews the various items as stated in the paper plan as originally 

 conceived. But the opinion does not in any place call attention to the fad 

 that many of these activities were never put in play. For instance, the 

 original plan provided for a daily shipping report; also for the exchange 

 of |)rice lists; also inspection reports. Now, none of those activities were 

 ever indulged, and yet one who reads this opinion and who is not familiar 

 with the facts would get the intpressiou that those matters were involveil 

 In the working <iut of this dainnnl conspiracy. 



Court May Have Been Misled 



.Xgain, there were i:i"U|i Mieetin;;s held ibriMmliour the territory wherein 

 the members of the plan had their <qjerations. In reading the opinion (Uie 

 woidd get the impression that all the nuMniiers of the plan had gathered 

 in group meetings once a week, or in other words that the plan was so ad 

 justed that there were constant elbow touch between all the cooperators. 

 whereas the truth is. nnd concerning which there is no dispute, that during 

 the whole life of the plan the 300-odd members never did meet in one meet- 

 ing. These group meetings were held in the various territories for the 

 convenience of the members. Those who lived close to one meeting place 

 attended that meeting and not the others, and less than 50 per cent of the 

 members attendeil any group meeting. Flowever, one reading this opini<m 

 would get an entirely different understanding of this phase. It is possible 

 th:it the court itself has been misled. 



It may be recalled that in my <»ral argument I definitely stated that there 

 were two items in which we were vitally concerned, to wit : The sale and 

 stock reports. I urgeil the court that if in Its judgment it was Illegal for 

 an association to send out market letters that sought to interpret statistics, 

 would it he legal to gather and disseminate statisics wihout market letters 

 or any ci)mment':' I conceivt^l that this was a practical suggestion and as 

 a lawyer I knew I was entirely within my province in making same. Un- 

 fortunately, however, the <-ourt doi-s nr>t directly and (b-finitely decide the 

 matter. In other words, it is ililtitult to dctermhu-. in the light of this de- 

 cision, what the court's opinffm wouhl be if there was nothing Involved but 

 the gathering and assembling of statistics covering past tninsactions. This 

 was indeed the very heart of our lawsuit. The market letters, the ques 

 tionnairc. the group meetings were hut casual and of no moment. 



It is. indeed, unfortunate that the court did not give definite guidance so 

 that those industries that have no common markets wouhl know their legal 

 limitations, because If the <ourt did hold that under no circumstances could 

 inilustry keep itself informed by means of associated effort, then Congress 

 woulfl have to relieve the situation. 



The problem will be carefully reviewed in our application for a rehearing 

 and the members can depend upon it that all will be done that is possible. 

 Yon can well understand that this opinion came as a distinct shock to me. 

 The more I read the opinion the greater is my ilisappointment. I am not 

 complaining because I lost. My disappointment grows out of the fact that 

 the decision does not settle anything. It is possible that through the me- 

 dium of our application for a rehearing something definite may come. 



(funtimnd on pof/r 2i'' * 



