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[276 U.S. 311, 313] Messrs. Charles E. Hughes, of New York City, Conrad H. Syme, and Charles A. Doughlas, both of Washington, D. C., and Henry Veeder, and Charles J. Faulkner, Jr., both of Chicago, Ill., for Swift & Co. and others.
[276 U.S. 311, 317] Mr. Wm. J. Donovan, Asst. Atty. Gen., for the United States. [276 U.S. 311, 318] Mr. Wm. C. Breed, of New York City, for National Wholesale Grocers' ass'n.
Mr. Edgar Watkins, of Atlanta, Ga., for American Wholesale Grocers' Ass'n.
Mr. Justice BRANDEIS delivered the opinion of the Court.
This case presents the question whether the consent decree entered February 27, 1920, with a view to prevent- [276 U.S. 311, 319] ing a long-feared monopoly in meat and other food products, is void. 1
On that day the United States filed in the Supreme Court of the District of Columbia, sitting in equity, a petition under section 4 of the Sherman Anti-Trust Act, July 2, 1890, c. 647, 26 Stat. 209 (15 USCA 4), to enjoin violations of that statute and of the Clayton Act, October 15, 1914, c. 323, 38 Stat. 730, 736. It named as defendants the five leading packers; namely, Swift & Co., Armour & Co., Morris & Co., Wilson & Co., Inc., and the Cudahy Packing Company. And it joined with them 80 other corporations and 50 individuals, all but four of whom were associated with some one of the five defendants above named. The petition charged the defendants with attempting to monopolize a large proportion of the food supply of the nation and with attempting to extend the monopoly by methods set forth. It stated that the purpose of the suit was to put an end to the monopoly described and to deprive the defendants of the instrumentalities by which they were perfecting their attempts to monopolize. It sought a comprehensive injunction and also the divestiture of the instrumentalities described. [276 U.S. 311, 320] Simultaneously with the filing of the petition, all the defendants filed answers which denied material allegations of the bill. There was filed at the same time a stipulation, signed by all the parties to the suit, which provided that the court might, without finding any fact, enter the proposed decree therein set forth. On the same day a decree in the form so agreed upon was entered. To this decree all parties filed assents. In its opening paragraph, the decree embodied a clause of the stipulation to the effect that, while the several corporations and individual defendants 'maintain the truth of their answers and assert their innocence of any violation of law in fact or intent, they nevertheless, desiring to avoid every appearance of placing themselves in a position of antagonism to the government, have consented and do consent to the making and entry of the decree now about to be entered without any findings of fact, upon condition that their consents to the entry of said decree shall not constitute or be considered an admission, and the rendition or entry of said decree, or the decree itself, shall not constitute or be considered and adjudication that the defendants or any of them have in fact violated any law of the United States.'
The decree declared, among other things, that the court had jurisdiction of the persons and the subject-matter, and 'that the allegations of the petitioner state a cause of action against the defendants under the provisions' of the Sherman Anti-Trust Act and supplementary legislation. It granted comprehensive relief in accordance with the prayer of the bill. The details will be discussed later. The decree closed with this provision:
None of the original parties to the suit made any application to the court between the date of the entry of the consent decree and November 5, 1924; but three intervening petitions were filed-that of the Southern Wholesale Grocers' Association, allowed September 10, 1921, that of the National Wholesale Grocers' Association, allowed November 5, 1921, and that of the California Co-operative Canneries, allowed September 13, 1924. See California Co-op. Canneries v. United States, 55 App. D. C. 36, 299 F. 908. On November 5, 1924, two motions to vacate the decree were filed in the cause. One was by Swift & Co. and the subsidiary corporations and individual defendants associated with it; the other by Armour & Co. and the subsidiary corporations and individual defendants associated with it. The allegations of the two motions were identical; and each prayed that the consent decree be declared void. The grounds of invalidity relied upon will be stated later. On May 1, 1925, the two motions to vacate the consent decree were overruled. From the order overruling them, Swift & Co. and Armour & Co., with their respective associates, took appeals to the Court of Appeals of the District of Columbia.
On May 28, 1926, the United States filed in that court a motion to dismiss the appeals for want of jurisdiction, contending that an appeal lay only directly to this court. On January 3, 1927, the Court of Appeals of the District entered an order dismissing the appeals. Promptly thereafter, Swift & Co., Armour & Co., and their respective associates, moved that court to stay the mandate and to transfer the appeals to this Court, pursuant to the Act of September 14, 1922, c. 305, 42 Stat. 837, incorporated in the Judicial Code as 238(a). On [276 U.S. 311, 322] January 31, 1927, the Court of Appeals vacated its opinion and order, and restored the case for reargument upon the question of its jurisdiction of the appeals and for argument on its jurisdiction to transfer the appeals to this court. Thereafter, having heard argument, the Court 13, 1925, c. 229, 43 Stat. 936. On October 17, court, under section 251 of the Judicial Code as existing prior to the Act of February 13, 1925, c. 229, 43 S. Stat. 936. On October 17, 1927, this court, having heard argument on the certificate, ordered that the entire record in the cause be sent here, as provided in the same section. On that record the case is before us. Many questions are presented.
An objection of the government to the jurisdiction of this court must first be considered. The Expediting Act of February 11, 1903, c. 544, 32 Stat. 823, U. S. C. tit. 15, 29 (15 USCA 29), provides that, from a final decree in a suit in equity brought by the government under the Anti- Trust Act, an appeal lies only directly to this court. The government suggests that under the Expediting Act no appeal lay to the Court of Appeal from the order denying the motion to vacate; that the Court of Appeals consequently was powerless to certify questions relating to the merits; that this court by ordering up the record, as provided in section 251 of the Judicial Code, did not acquire jurisdiction to decide questions which could not lawfully have been certified under that section; that the case may not be treated as here on transfer, because the Court of Appeals of the District is not a Circuit Court of Appeals within the meaning of the Act of 1922; and that this court is therefore without power to pass on the merits of the cause. Swift and Armour answer that the motions to vacate the consent decree are not subject to the provisions of the Expediting Act because they are not a part of the suit filed February 27, 1920, under the Anti-Trust Act, but constitute a new suit. Compare Stevirmac Oil
[276 U.S. 311, 323]
& Gas Co. v. Dittman,
The court of Appeals of the District was therefore without jurisdiction to entertain the appeals. We think, however, that it was a Circuit Court of Appeals within the meaning of the Transfer Act; and, as the judgment appealed from was entered before the effective date of the Act of February 13, 1925, the appeals should have been transferred to this Court. Compare Pascagoula National Bank v. Federal Reserve Bank of Atlanta,
The decree sought to be vacated was entered with the defendants' consent. Under the English practice a consent decree could not be set aside by appeal or bill of
[276 U.S. 311, 324]
review, except in case of clerical error. Webb v. Webb, 3 Swanst. 658; Bradish v. Gee, 1 Amb. 229; Daniell, Chancery Practice (6th Am. Ed.) 973- 974. In this Court a somewhat more liberal rule has prevailed. Decrees entered by consent have been reviewed upon appeal or bill of review where there was a claim of lack of actual consent to the decree as entered ( Pacific R. R. Co. v. Ketchum,
First. At the time the questions were certified, there was a contention that the Supreme Court of the District lacked jurisdiction of the Subject-matter, because it is not a District Court of the United States within the meaning of the Anti-Trust Act. After entry of the case in this court, that contention was disposed of by Federal Trade Commission v. Klesner,
Second. It is contended that the Supreme Court lacked jurisdiction because there was no case or controversy within the meaning of section 2 of article 3 of the Constitution. Compare Lord v. Veazie, 8 How. 251; Little v. Bowers,
[276 U.S. 311, 327]
Third. It is contended that the consent decree was without jurisdiction because it was entered without the support of facts. The argument is that jurisdiction under the Anti-Trust Acts cannot be conferred by consent; that jurisdiction can exist only if the transactions complained of are in fact violations of the act; that merely to allege facts showing violation of the anti-trust laws is not sufficient; that the facts must also be established according to the regular course of chancery procedure; that this requires either admission or proof; and that here there was no admission but, on the contrary, a denial of the allegations of the bill, and a recital in the decree that the defendants maintain the truth of their answers, assert their innocence, and consent to the entry of the decree without any finding of fact, only upon condition that their consent shall not constitute or be considered an admission. The argument ignores both the nature of injunctions, already discussed, and the legal implications of a consent decree. The allegations of the bill not specifically denied may have afforded ample basis for a decree limited to future acts. Deputron v. Young,
Fourth. It is contended that, even if the decree is not void as a whole, parts of it must be set aside as being in excess of the court's jurisdiction. This is urged in respect to the first and the ninth paragraphs, which are said to
[276 U.S. 311, 328]
be too vague and general. The first enjoins the corporation defendants from 'in any manner maintaining or entering into any contract, combination, or conspiracy ... in restraint of trade or commerce among the several states, or from ... monopolizing or attempting to monopolize ... any part of such trade or commerce.' The ninth enjoins the corporation defendants from 'using any illegal trade practices of any nature whatsoever in relation to the conduct of any business in which they or any of them may be engaged.' It is insisted that, as a court's power is limited to restraining acts which violate or tend to violate laws, the acts to be enjoined must be set forth definitely; and that these paragraphs are so general in terms as to make the defendants liable to proceedings for contempt if they commit any breach of the law. The paragraphs, if standing alone, might be open on appeal to the objection that they are too general to be sanctioned. Compare Swift & Co. v. United States,
Fifth. It is contended that paragraphs second to eighth of the decree are void because of their comprehensiveness. These paragraphs enjoin the defendants from holding directly or indirectly (without the consent of the court) any interest in any public stockyard, or any stockyard terminal railroad, or any stockyard market journal published in the United States, and enjoin the defendants, except as there provided, from engaging or being interested in [276 U.S. 311, 329] the business of manufacturing, buying, selling, or handling any one of 114 enumerated food products or any one of 30 other named articles of commerce; from selling meat at retail; from selling milk or cream; from holding any interest in any public cold storage plant; from using their distributive systems (including branch houses, refrigerator cars, route cars, and autotrucks) in any manner for the purpose of handling any of the many articles above referred to; and from having more than a half interest in or control of any business engaged in manufacturing, jobbing, selling, transporting, or delivering any one of most of the articles above referred to.
The argument is that the power to issue an injunction is limited by the scope of the transactions prohibited by sections 1, 2, and 3 of the Anti-Trust Act (15 USCA 1-3); that the defendants are here enjoined, not only from remaining in these lawful businesses named, but also from ever re-entering them; that none of these 'unrelated' lines of business are unlawful in themselves; that none can be restrained unless, by a finding of the essential facts, the connection with the conspiracy is established; that no such facts have been found; that the parties cannot by consent confer jurisdiction to issue an injunction broader than the facts warrant; and that an injunction so broad as that entered involves usurpation by the judicial branch of the government of the function of Congress. Compare United States v. New York Coffee & Sugar Exchange,
[276 U.S. 311, 330]
Sixth. The defendants make a further contention concerning paragraphs second to eighth, which differs little from that just answered. It is urged that the decree is void, because it obliges the defendants to abandon completely certain business which are inherently lawful and forbids them from entering into other businesses which may be lawfully conducted; and that to do this is not merely unauthorized by, but is contrary to, the common law and the Anti-Trust Act. Compare Nordenfelt v. Maxim Nordenfelt Co. (1897) A. C. 535; United States v. Addyston Pipe & Steel Co. (C. C. A.) 85 F. 271, 46 L. R. A. 122. But the court had jurisdiction of the subject-matter and of the parties. And even gross error in the decree would not render it void. Compare Ex parte Watkins, 3 Pet. 193; Ex parte Parks,
Seventh. It is contended that the decree is void because the injunction is not limited to acts in interstate commerce. This objection is in essence like the two preceding ones. The argument is that each of the businesses named in paragraphs second to eighth is susceptible of being carried on in intrastate commerce alone; that some of these businesses, for instance retail meat markets, are distinctly intrastate in character; that there was no finding of an interweaving of intrastate and interstate transactions as in United States v. New York Central R. R. Co.,
Eighth. Finally, it is urged that the decree is void, because the Attorney General had no power to agree to its entry. Compare Kelley v. Milan,
Mr. Justice SUTHERLAND and Mr. Justice STONE took no part in the consideration or decision of this case.
[
Footnote 1
] See Swift & Co. v. United States,
[ Footnote 2 ] Suits in equity under Revised Statutes, 4921 (35 USCA 70; Comp. St. 9467), to enjoin patent infringements, like suits in equity under the Anti- Trust Acts, are entertained by the Supreme Court of the District solely by virtue of its general powers as a District Court of the United States. Revised Statutes, 629(9) being 28 USCA 41(7); Act of March 3, 1911, c. 231, 36 Stat. 1087, 1167. These are commonly brought, as was the case at bar, in the equity term. See the original papers in Krupp v. Crozier, 32 App. D. C. 1, 15 Ann. Cas. 1108; Boynton v. Taggart, 40 App. D. C. 82; Tabulating Machine Co. v. Durand, 38 Wash. L. R. 552; Comptograph Co. v. Adder Machine Co., 41 App. D. C. 427; Hutchison Vapor Heating Corporation v. Mount, 48 App. D. C. 388. In United States v. Baltimore & Ohio R. R. Co., 26 App. D. C. 581, it was held that a suit to collect penalties for violation of the Safety Appliance Act might be brought in the circuit term of the Supreme Court of the District, though the act provided for the bringing of suits 'in the District Court of the United States having jurisdiction in the locality where such violation shall have been committed.' Act of March 2, 1893, c. 196, 27 Stat. 531, 532 (45 USCA 1-7; Comp. St. 8605-8610, 8612).
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Citation: 276 U.S. 311
No. 181
Decided: March 19, 1928
Court: United States Supreme Court
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