preparing a case as we have on new marketing methods, and then we have nowhere to be heard. Nobody wants to hear me.

How do I go back and tell 500 cattlemen that because of the Illinois Brick ruling their rights have been taken away?

I speak on 200 or 330 college compuses every year, and I do not know how I am going to go back and tell those people that Glenn Freie who has done what he is supposed to have done under the law has a case that is not going to be heard. How am I going to tell them? I do not know.

That is why the Illinois Brick ruling has to be overturned as far as I am concerned. We realize it is a serious problem, and we realize there is a lot involved, but we believe that there are some answers to the problems.

Senator WALLOP. Has the Justice Department been of any assistance?

Mr. FREIE. No. I have to say that they have not. We have met with them two or three times, and there seems to be no interest in working with us.

Senator WALLOP. They have not given it any more than a cursory look?

Mr. FREIE. We have never heard anything from them.

Senator WALLOP. The Antitrust Division has been of no assistance?

Mr. FREIE. That is right. We met with them during the first 2 months, and we said, "If you people are going to do the job, we are not going to get involved." I am not downgrading, but it is my opinion that the old saying is true-the wheel that squeeks the loudest gets oiled first. Some of these agencies have so much going on that some matters just slip by the wayside. Then it is time for the citizenry to pick up the ball. We have cattlemen who have put many thousands of dollars into this. They have had to borrow the money. They have their farms mortgaged to the hilt just so that they can be heard. That is all we are asking for. We are not asking for anyone to give us anything. We just want to be heard.

Senator WALLOP. Mr. Freie, thank you very much. Again, I apologize to you for not being here when you made your initial statement.

Mr. FREIE. I realize that. We will submit these notes that I made. I never speak with notes, and I should not have started today, but I did, and I paid for it.

Senator WALLOP. If you wish, you may retain your notes for your own purposes.

Mr. FREIE. Thank you.

Senator WALLOP. Thank you very much for taking the time to come before the subcommittee at such short notice. We appreciate your being here.

[The prepared statement of Glenn Freie follows:]

PREPARED STATEMENT OF GLENN L. FREIE

My name is Glenn L. Freie, and I am a farmer and livestock producer from Latimer, Iowa. I am appearing before this subcommittee in my capacity as Chairman of Meat Price Investigators Association, a trust and unincorporated association representing approximately 500 cattlemen in 14 States.

In early 1975, a group of Iowa cattlemen, including myself, became disturbed by the extended depressed price that cattlemen were receiving for their cattle. We had

read about an antitrust lawsuit brought by a few Iowa cattlemen. Some of us had heard about a jury verdict in a case brought by a few West Coast cattlemen against A. & P. In other words, our curiosity about possible antitrust problems in our industry brought some of us together to see if we could do anything to help ourselves. We believed that if we could show that we were wronged and injured, the law provided us a remedy.

At that time (February 1975) we simply could not understand the way the cattle market was working. All we knew was that we were losing a lot of money.

We started talking to other cattlemen around the State of Iowa, and in March 1975, about 120 met together in Des Moines to discuss our common problems. At that meeting, we decided that something was definitely wrong. We formed an organization which eventually became Meat Price Investigators Association (or "MPIA") and hired a couple of Des Moines lawyers with antitrust experience to see if they could figure out what was going on. I was elected by the group to keep an eye on the lawyers.

First of all, we went to Washington, D.C. and talked with the Justice Department, the FTC, the Department of Agriculture, Packers and Stockyards Administration, and various committees of Congress who were then, or had been recently, investigating the food industry in general. We found little help or enlightenment, and little interest in getting behind the problem. No one was interested in enforcing the law for cattlemen, in spite of the fact that a Federal jury in San Francisco had just found that A. & P. and other retail food chains had violated the Sherman Act in the procurement of beef during 1964 to 1968. Of course, all of us had talked to our packer buyers about our problem they were not interested in helping us by suing their customers, the retail food chains. We later were to learn why packers would not sue, they were and are part of the rig.

The stark reality in 1975 for MPIA was that if someone was going to get behind the beef marketing system in the United States, locate the problems, and enforce the antitrust laws, we were going to have to do it ourselves. The incentive for our action was the Sherman and Clayton Acts, which then clearly told us that if we could prove a case, we could receive compensation for our injuries and obtain corrective injunctive relief. With this understanding of our rights in the Federal courts, we pooled together our money. We felt that even though we had all lost hundreds of thousands of dollars in the cattle business, and some of us had gone totally broke, it was worth while to somehow find the money to seek redress for our injuries in the courts. With that in mind, we sought out other cattlemen to make substantial financial commitments to our investigation and possible lawsuit.

MPIA has now been investigating the beef industry for over 3 years. We have spent many tens of thousands of dollars of our members money. We have traveled all over the country. We have consulted with many of the leading agricultural economists and other experts in the field. We have developed a convincing case of a massive combination in restraint of trade and attempted monopolization of the beef industry, whose target has been and is still the cattleman. We are the persons they intend to injure they are intentionally in combination to depress our price.

In December 1975, we brought a lawsuit in the Southern District of Iowa against the 10 largest retail food chains, their trade association, and a price-setting service known as the National Provisioner "yellow sheet." In August 1976, we brought an additional lawsuit against four major beef packers. Both suits charge violations of sections 1 and 2 of the Sherman Act.

After 8 months delay, our case against retailers was consolidated by the multidistrict panels with several other similar cases brought by hundreds of cattlemen throughout the country in the Northern District of Texas in re Beef Industry Antitrust Litigation, MDL No. 248. Later on, our packer case was also consolidated into that Multidistrict docket.

At all times prior to the Illinois Brick decision, the Fifth Circuit would allow proof of offensive pass-on. This was clearly stated in the Yoder Brothers case. As soon as Illinois Brick came down, the retail defendants moved to dismiss our case. In spite of the fact that we could show a clear pass-on and a two-tier combination between retailers and beef packers, Judge Taylor dismissed our retail case last December (1977). The cases are now on appeal to the Fifth Circuit. Our opening brief will be due shortly.

The long and short of the situation is that when we investigated and filed our retail lawsuit in 1975, we clearly had a remedy under the antitrust laws. Now the Courts say we have none. As far as cattlemen are concerned, Clayton section 4 has been repealed.

During the seventys, thousands of cattlemen have been forced out of business. Hundreds of thousands of cattlemen have lost sustantial money. The cattle industry

is a $17 billion a year business. This $17 billion a year business now has no remedy in the courts for antitrust violations against it.

We believe that the reason for the courts in this country is to do justice. We believe that where there is an injury, there must be a remedy. If the only goal of our laws were enforcement, then perhaps it would be wise to repeal the Bill of Rights. But even if enforcement is the only goal of the Federal antitrust laws, who is going to enforce our claims? Who besides ourselves will come forward to enforce the antitrust laws in the beef industry. Certainly not those middlemen to whom we sell, for they are in combination against us.

We need clarifying legislation affirming our right to damages against those in the chain of distribution above us, whether we sold to them directly or not. We support S. 1874 and encourage this subcommittee to pass an Illinois Brick repealer as soon as possible.

In conclusion, I repeat that MPIA was organized with the understanding that producers had a remedy against those setting prices even if the producer did not sell directly to the price fixer. Virtually all investigative activity that has been undertaken with regard to pricing in the beef industry has been generated by private cattlemen in antitrust lawsuits. If we, the indirect sellers, do not have the right to sue, the price fix in the beef industry will never see the light of day in the Courts. Senator WALLOP. There is no further business to come before the subcommittee, the hearing will stand adjourned.

[Whereupon, at 11:45 a.m., the hearing was adjourned.]

FAIR AND EFFECTIVE ENFORCEMENT OF THE

ANTITRUST LAWS, S. 1874

MONDAY, APRIL 17, 1978

U.S. SENATE,

SUBCOMMITTEE ON ANTITRUST AND MONOPOLY

OF THE COMMITTEE ON THE JUDICIARY,

Washington, D.C.

The subcommittee met, pursuant to recess, at 9:05 a.m., in room 2228, Dirksen Senate Office Building, Senator Orrin G. Hatch (acting chairman of the subcommittee) presiding.

Also present: Terry Lytle and Robert Banks, counsels.

Senator HATCH. These hearings will now be called to order on S. 1874.

Since we must curtail the time for each witness with a 5- to 10minute statement, the full statements will be placed in the record. Some questions must be withheld and submitted in writing to the witnesses for early response to meet the time schedule for markup on the bill on April 28.

We will go with our first witness, Harold R. Tyler, Jr.

We are very happy to welcome you here and listen to your testimony.

STATEMENT OF HAROLD R. TYLER, JR., ATTORNEY, NEW YORK CITY

Mr. TYLER. Thank you, Mr. Chairman.

I have delivered what I hope are the requisite number of copies of my formal statement. I will now proceed with that with your leave.

I will summarize my position and then perhaps you may wish to address questions to me in that regard.

Senator HATCH. Your statement will be made a part of the record.

Mr. TYLER. Very simply, Mr. Chairman, though I understand and sympathize with the many considerations which have led to the effort in the last year almost to deal with the June 1977 opinion of the high court on Illinois Brick, I have to say that particularly since testifying in the House last fall I have come to the conclusion that it would be best on balance to let the situation sit without any legislation specifically designed to overrule Illinois Brick or perhaps, put better, to overrule Illinois Brick and its predecessor, Hanover Shoe.

My argument is as follows. First, I believe that the primary objective of private antitrust suits as permitted by the Clayton Act is to deter antitrust violations. This means that the object of com