*332 U.S.

JACKSON, J., dissenting.

IV.

Whether, as matter of policy, corporate managers during reorganization should be prohibited from buying or selling its stock, is not a question for us to decide. But it is for us to decide whether, so long as no law or regulation prohibits them from buying, their purchases may be forfeited, or not, in the discretion of the Commission. If such a power exists in words of the statute or in their implication, it would be possible to point it out and thus end the case. Instead, the Court admits that there was no law prohibiting these purchases when they were made, or at any time thereafter. And, except for this decision, there is none now.

The truth is that in this decision the Court approves the Commission's assertion of power to govern the matter without law, power to force surrender of stock so purchased whenever it will, and power also to overlook such acquisitions if it so chooses. The reasons which will lead it to take one course as against the other remain locked in its own breast, and it has not and apparently does not intend to commit them to any rule or regulation. This administrative authoritarianism, this power to decide without law, is what the Court seems to approve in so many words: "The absence of a general rule or regulation

as part of a program in contemplation of reorganization benefits. In this connection, we wish to emphasize that our concern here is not primarily with the normal corporate powers which make it possible for officers and directors to influence the market for their own gain, in the absence of reorganization, by a choice of dividend policies, accounting practices, published reports, and the like. The questions of fairness and detriment here presented arise before us in the context of a capital readjustment. At that point our scrutiny is called for, and that our scrutiny is to be vigilant cannot be doubted. See Appendix to Sen. Rep. No. 621 (74th Cong., 1st Sess.) on S. 2796, at p. 58, quoted supra."

194

JACKSON, J., dissenting.

governing management trading during reorganization did not affect the Commission's duties (Par. 13). This seems to me to undervalue and to belittle the place of law, even in the system of administrative justice. It calls to mind Mr. Justice Cardozo's statement that "Law as a guide to conduct is reduced to the level of mere futility if it is unknown and unknowable."

V.

The Court's averment concerning this order, that "It is the type of judgment which administrative agencies are best equipped to make and which justifies the use of the administrative process," (Par. 29) is the first instance in which the administrative process is sustained by reliance on that disregard of law which enemies of the process have always alleged to be its principal evil. It is the first encouragement this Court has given to conscious lawlessness as a permissible rule of administrative action. This decision is an ominous one to those who believe that men should be governed by laws that they may ascertain and abide by, and which will guide the action of those in authority as well as of those who are subject to authority."

I have long urged, and still believe, that the administrative process deserves fostering in our system as an expeditious and nontechnical method of applying law in special

The Growth of the Law, p. 3.

5 On the same day, the Court denied its own authority to recognize and enforce, without Congressional action, an unlegislated liability much less novel than the one imposed here, and that in the field of tort law which traditionally has developed by decisional rather than by legislative process. The result is to confirm in an executive agency a discretion to act outside of established law that goes beyond any judicial discretion as well as beyond any legislative delegation. Compare United States v. Standard Oil Co., 332 U. S. 301.

ized fields. I can not agree that it be used, and I think its continued effectiveness is endangered when it is used, as a method of dispensing with law in those fields.

MR. JUSTICE FRANKFURTER joins in this opinion.

UNITED STATES v. YELLOW CAB CO. ET AL.

APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS.

No. 1035. Argued May 7, 1947.-Decided June 23, 1947.

1. Allegations of a complaint filed in a federal district court pursuant to 4 of the Sherman Antitrust Act to prevent and restrain the defendants from violating §§ 1 and 2 of the Act, charging a combination and conspiracy to restrain and to monopolize interstate trade and commerce in the sale of motor vehicles for use as taxicabs to the principal cab operating companies in Chicago, Pittsburgh, New York City and Minneapolis, held sufficient to state a claim upon which relief might be granted. Pp. 220-228.

(a) A conspiracy to control the purchase of taxicabs by the principal operating companies in Chicago, Pittsburgh, New York City and Minneapolis, whereby they purchase their cabs exclusively from a Michigan manufacturer and are prevented from purchasing from other manufacturers, is in restraint of interstate commerce. Pp. 224-225, 226.

(b) In determining whether the complaint charges a violation of § 1 or § 2 of the Sherman Act, it is enough if some appreciable part of interstate commerce is affected by the restraint or monopoly. P. 225.

(c) Interstate purchases of replacements of some 5,000 licensed taxicabs in four cities is an appreciable amount of commerce. P. 225.

• See statement before House of Delegates, American Bar Association, 1939. (1939 Proceedings, House of Delegates, XXV A. B. A. Journal 95.) Also see Report as Attorney General to President Roosevelt recommending veto of Walter-Logan Bill-made part of veto message, Vol. 86, Part 12, Congressional Record, 76th Congress, 3d Session, p. 13943.

(d) The importance of the interstate commerce affected in relation to the entire amount of that type of commerce in the United States is irrelevant. P: 226.

(e) The complaint is not defective by reason of its failure to allege that the manufacturer involved has a monopoly with reference to the total number of taxicabs manufactured and sold in the United States. P. 226.

(f) The fact that the corporate defendants, by virtue of affiliation and common ownership, constitute a "vertically integrated enterprise" does not necessarily render inapplicable the prohibitions of the Sherman Act. P. 227.

2. Allegations of a conspiracy whereby two of the defendants will not compete with a third defendant for contracts with railroads or railroad terminal associations to transport passengers and their luggage between railroad stations in Chicago, held sufficient to charge a violation of the Sherman Act. Pp. 228–229.

(a) The transportation of passengers and their luggage between railroad stations in Chicago is a part of the stream of interstate commerce. P. 228.

(b) When persons or goods move from a point of origin in one state to a point of destination in another, the fact that a part of that journey consists of transportation by an independent agency solely within the boundaries of one state does not make that portion of the trip any less interstate in character. P. 228.

(c) Although exclusive contracts for the transportation service in question are not illegal, it is nevertheless a violation of the Sherman Act to conspire to eliminate competition in obtaining such contracts. P. 229.

(d) The fact that the competition restrained is that between affiliated corporations does not negative the statutory violation where the affiliation itself is one of the means of effectuating the illegal conspiracy not to compete. P. 229.

3. The service rendered by local taxicabs in conveying interstate passengers between their homes and railroad stations, in the normal course of their independent local service, is not an integral part of interstate transportation; and a restraint on or monopoly of that general local service, without more, is not proscribed by the Sherman Act. Pp. 230-234.

69 F. Supp. 170, reversed.

A complaint filed by the United States to prevent and restrain alleged violations of §§ 1 and 2 of the Sherman

Opinion of the Court.

332 U.S.

Antitrust Act was dismissed by the district court for failure to state a claim upon which relief might be granted. 69 F. Supp. 170. The United States appealed directly to this Court. Reversed and remanded, p. 234.

Charles H. Weston argued the cause for the United States. With him on the brief were Acting Solicitor General Washington, Assistant Attorney General Berge and Philip Marcus.

Samuel H. Kaufman argued the cause for appellees. With him on the brief were A. Leslie Hodson and Harold E. Lynton. Howard Ellis and Harold A. Smith were on a motion to dismiss or affirm.

MR. JUSTICE MURPHY delivered the opinion of the Court.

The United States filed a complaint in the federal district court below pursuant to § 4 of the Sherman AntiTrust Act, 26 Stat. 209, as amended, to prevent and restrain the appellees from violating §§ 1 and 2 of the Act. The complaint alleged that the appellees have been and are engaged in a combination and conspiracy to restrain and to monopolize interstate trade and commerce (1) in the sale of motor vehicles for use as taxicabs to the principal cab operating companies in Chicago, Pittsburgh, New York City and Minneapolis, and (2) in the business of furnishing cab services for hire in Chicago and vicinity. The appellees moved to dismiss the complaint for failure to state a claim upon which relief might be granted. That motion was sustained. 69 F. Supp. 170. The case is now here on direct appeal by the United States.

The alleged facts, as set forth in the complaint, may be summarized briefly. In January, 1929, one Morris Markin and others commenced negotiations to merge the