419.

MCKENNA, DAY, and CLARKE, JJ., dissenting.

for the collision, it follows, as a necessary legal consequence, that there can be no lien, otherwise the non-liability would amount to nothing." And again, "If the government is not responsible, upon the principles of the common law, for wrongs committed by her officers or agents, then, whether the proceedings in the admiralty are against the vessel, or its proceeds, the court is bound to dismiss them." And giving point to this view the learned Justice observed that "no principle at common law is better settled than that the government is not liable for the wrongful acts of her public agents."

I repeat, that in view of these extracts from Mr. Justice Nelson's dissent, misapprehension of its opinion by the court is not conceivable nor carelessness of utterance. Yet the opinion in the present cases practically so asserts and, in effect, regards Mr. Justice Nelson's dissent as the law of the Siren and not that which the court pronounced. The court decided that the vessel was the offending thing, and though it could not be reached in the hands of the Government, this "inability to enforce the claim against the vessel" was "not inconsistent with its existence."

The inevitable deduction is that in such situation the enforcement of a claim is suspended only, and when the vessel passes from the hands of the Government, as the offending vessels have in the cases at bar, they and "all claims and equities in regard to " them may be enforced.

The case was commented on in The Davis, 10 Wall. 15, 20, and the gloss now put upon it rejected. It is there said that the well supported doctrine of the case is "that proceedings in rem to enforce a lien against property of the United States are only forbidden in cases where, in order to sustain the proceeding, the possession of the United States must be invaded under process of the court."

So again in Workman v. New York City, 179 U. S. 552, where it is said, Chief Justice White delivering the opinion of the court, after an exhaustive review of cases, such as

MCKENNA, DAY, and CLARKE, JJ., dissenting. 257 U.S.

he usually gave, "It results that, in the maritime law, the public nature of the service upon which a vessel is engaged at the time of the commission of a maritime tort affords no immunity from liability in a court of admiralty, where the court has jurisdiction." In view of this it is difficult to understand how it can be said that there was nothing that case decided contrary to the conclusion in these cases.

Against this array of cases and their reasoning, Ex parte State of New York, No. 2, 256 U. S. 503, and Ex parte State of New York, No. 1, 256 U. S. 490, are adduced. Neither case has militating force. The latter case decided nothing but that a State cannot be sued without its consent. An indisputable proposition which this court in its opinion had to clear from confusing or disturbing circumstances. In the former case, The Queen City, a steam tug, was in the possession and service of the State of New York and to have awarded process against it as the District Court did, would have arrested the service. This court rightfully reversed that action. The tug had not been released from that immunity as the vessels were in the pending cases.

Counsel for claimants in opposition to the petition cite cases at circuit and district which followed The Siren.1

1 The U. S. S. Hisko, U. S. S. Roanoke and U. S. S. Pocahontas (Circuit Judge Manton, S. D. N. Y.) (March 17, 1921, unreported opinion annexed to brief);

The U. S. S. Newark (District Judge Knox, S. D. N. Y.) (March 18, 1921, unreported opinion annexed to brief);

The U. S. S. Sixaola (District Judge Mayer, S. D. N. Y.) (April 21, 1921, unreported opinion annexed to brief);

The F. J. Luckenbach, 267 Fed. 931; The Liberty, now before this court; The Carolinian, 270 Fed. 1011, also now before this court.

Also: The Florence H., 248 Fed. 1012; The Gloria, 267 Fed. 929; The City of Philadelphia, 263 Fed. 234.

Counsel also cites: The Tampico, 16 Fed. 491; Thompson Navigation Co. v. City of Chicago, 79 Fed. 984; Johnson Lighterage Co., 231 Fed. 365; The Attualita, 238 Fed. 909; The Luigi, 230 Fed. 493; The Othello, 5 Blatchf. 343.

It is not necessary to review or comment upon them. They are testimony of what the judiciary of the country considered and consider The Siren and other cases decided. Therefore we cannot refrain from saying that it is strange, that notwithstanding the language of The Siren, its understanding and acceptance in many cases in this court, the enforcement of its doctrine at circuit and district, it should now be declared erroneous. The cases at bar would seem to be cases for the application of the maxim of stare decisis which ought to have force enough to resist a change based on finesse of reasoning or attracted by the possible accomplishment of a theoretical correctness.

The rules should be discharged.

FEDERAL TRADE COMMISSION v. BEECH-NUT PACKING COMPANY.

CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT.

No. 47. Argued November 10, 14, 1921.-Decided January 3, 1922.

1. A trader does not violate the Sherman Act by simply refusing to sell his goods or by withholding them from those who do not sell them at the resale prices he fixes; but he may not, by contracts or combinations express or implied, unduly hinder or obstruct the . free and natural flow of interstate commerce. P. 452. 2. The public policy evinced in the Sherman Act is to be considered in determining what are "unfair methods of competition" within the Federal Trade Commission Act. P. 453.

3. A plan of merchandising, in interstate trade, which has a dangerous tendency unduly to hinder competition or to create monopoly, the Federal Trade Commission has authority to order suppressed. P. 454.

4. The respondent manufacturer, for the purpose of maintaining resale prices fixed by itself, declined to sell its products to jobbers, wholesalers or retailers who did not observe them or who sold to other dealers who failed to do so, and, to enforce this policy, ob

Argument for Respondent.

257 U.S.

tained, by the coöperation of its customers and through its agents and salesmen, and by marking and tracing the cases of its goods, the names of dealers who cut the prices or who sold to others who did so, and enrolled them as undesirable customers to whom it did not sell until they gave satisfactory assurances of their purpose to conform in the future. By these means it was enabled to suppress competition in the disposition of its products after it had sold them, by preventing all who did not conform to the resale prices from obtaining more goods, although there was no contract for fixing, maintaining or enforcing the resale prices. Held, that these, or any other equivalent coöperative means, should be enjoined, upon an order of the Federal Trade Commission, as an unfair method of competition. P. 454.

264 Fed. 885, reversed.

CERTIORARI to review a judgment of the Circuit Court of Appeals setting aside an order of the Federal Trade Commission.

Mr. Solicitor General Beck, with whom Mr. W. H. Fuller, Mr. Marshall B. Clarke and Mr. Adrien F. Busick were on the brief, for petitioner.

Mr. Charles Wesley Dunn for respondent.

The Sherman Act does not deprive a manufacturer or trader, engaged in an entirely private business and exercising his independent discretion in the normal course of his trade without any purpose to create or maintain a monopoly, of his fundamental right of freedom to trade existing at common law, to wit, the right freely to sell his own property (consisting of legitimate articles of commerce) or not, as he pleases, for any reason he pleases, to whom he pleases, and to announce in advance the circumstances under which he will refuse to sell, who, when he does sell, imposes no restraint whatever upon the right of future alienation, by restrictive agreements (express or implied), since that act was enacted to preserve such fundamental right of freedom to trade, and not to impair or destroy it.

Likewise, § 5 of the Federal Trade Commission Act, does not deprive a manufacturer or trader, engaged in an entirely private business and exercising his independent discretion in the normal course of his trade without any unlawful purpose (a purpose either opposed to good morals because characterized by fraud, deception, misrepresentation, bad faith, intimidation, oppression, or some other such wrongful element, or against public policy because involving undue restraint of trade or monopoly, actual or potential, or the doing of any act otherwise prohibited by law), of this fundamental common-law right of freedom to trade, since that act, as in the case of the Clayton Act, was enacted to supplement and strengthen the Sherman Act, and thus more completely and effectually to preserve and protect such fundamental right of freedom to trade, and not to impair or destroy it.

And if 5 of the Trade Commission Act may be construed and is applied to deprive a manufacturer or trader of this fundamental right, then that section violates the due process clause of the Fifth Amendment.

The theory upon which the Commission predicates its charge and conclusion that the refusal-to-sell policy of the respondent involves the use of an unfair method of competition outlawed by § 5, is conclusively established to be without any support or justification whatever, either in fact or law, when tested by the agreed facts and the applicable principles of law.

MR. JUSTICE DAY delivered the opinion of the court.

This case is here upon a writ of certiorari to the United States Circuit Court of Appeals for the Second Circuit, which court set aside an order of the Federal Trade Commission requiring the Beech-Nut Packing Company, a corporation engaged in the manufacture and sale of food and other products throughout the United States, to