3. Give some idea of the way in which the Federal power to regulate commerce touches the various interests of the people.

4. Explain the meaning of the word "commerce" as used in the Constitution.

5. Show how the meaning of the word has been enlarged by modern inventions and discoveries.

6. Does it include manufacturing? Cite an authority.

7. Outline briefly the general methods and kinds of regulation adopted by Congress.

8. Could Congress regulate a company which has its factory in Philadelphia and ships its goods to San Francisco and Seattle? Reasons.

9. Could Congress regulate the manufacture of the goods in Philadelphia? Reasons.

IO.

Mention several prominent companies whose business is now or could be constitutionally regulated by Congress.

11. Explain what a rebate is and why it is prohibited by the interstate com

merce act.

12. Give a brief summary of the most important powers of the interstate commerce commission.

13. Mention several forms of discrimination practiced on the railways in the past and explain the authority of the commission to prevent such discrimination under the present laws.

14. Explain the chief causes of railway discrimination between cities and districts. Why are the railways often forced to give such discriminations against their will?

15. What power has the interstate commerce commission over this situation? 16. John Doe tries unsuccessfully to secure a rebate from the railway, but is refused. Richard Roe secures a special rate lower than the published rate, but is given no rebate. Thomas Jenkins accepts a free pass from the railway, in return for which he ships freight over the railway's line. State all of the parties who have violated the law. Explain fully.

17. Is it legal for a large shipper of fruits to secure a lower charge for icing the refrigerator cars which he hires from a private car company, than is paid by other fruit growers shipping over the same line?

18. What is misdescription? Is it an offence by the railway or the shipper? Is it legal? Explain.

19. Explain the importance of car supply in modern coal mining or in other industries. If a coal operator does not secure his proper proportion of cars what redress has he?

20. May a railway give any preference whatever to a shipper or to any kind of traffic or to any locality? Explain fully.

21.

What is the long and short haul clause?

22. How does it affect the rates west of the Missouri River?

23. How does the interstate commerce law provide for the quicker settlement of disputes?

24. What was the Commerce Court? Why was it established and why abolished?

25. Has the commission regulative power over anything besides railways? 26. Give some idea of the business transacted by the commission.

27. What are your impressions as to the success of the commission's regulation of rates?

28. Outline the proposal to extend the commission's authority over water rates and explain why it is proposed.

29. What authority has the government over interstate railway labor strikes and disputes?

30. Outline the Railway Arbitration Act and explain its practical results. 31. Does the Constitution give Congress any power over intrastate trade? 32. A steamer is plying the waters of the Little River, carrying merchandise and passengers who are destined from one State to another, but the steamer itself only transports them from one point to another within the same State.

The river opens into a large lake part of which lies in another commonwealth. Under these circumstances would the national navigation and license laws apply to the steamer?

33. Congress passes a law forbidding interstate railways to keep their employees at work more than sixteen hours in any one day. The purpose of the act is greater safety on interstate lines. Could a railway which is subject to the act employ its workmen for fifteen hours on interstate work and then two hours on local business in intrastate trade? Explain the reasons and cite a precedent

34. A Federal act provides that safety brakes shall be placed on all trains used in connection with interstate commerce. An interstate line operates three cars without such brakes locally in its intrastate business and in doing so moves them over a part of its interstate line. Would the application of the Federal act to these cars be constitutional? Reasons. Cite an authority.

35. A State railway commission fixes high rates from the State boundaries to interior points in order to keep out trade from the outside and low rates between interior points, in order to promote local trade. Can the interstate commerce commission interfere with this system in such a way as to promote outside trade into the State? Reasons and authority.

36. Prepare an essay on "The Need for and Results of Federal Railway Regulation."

CHAPTER VII

POWERS OF CONGRESS-Continued

THE SHERMAN ANTI-TRUST ACT

Purpose and Provisions.-The second step in our national policy of regulation corresponded to the popular belief that trusts, combinations and monopolies were evils in themselves, and should be abolished by law. This thought lies at the basis of the now celebrated Act of 1890, known as the Sherman law, which provides as follows:

Sec. 1. "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal. Every person who shall make any such contract or engage in any such combination or conspiracy, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment, not exceeding one year, or by both said punishments, in the discretion of the court.

Sec. 2. "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court.

Sec. 3. "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce in any Territory of the United States or of the District of Columbia, or in restraint of trade or commerce between any such Territory and another, or between any such Territory or Territories and any State or States or the District of Columbia, or with foreign nations, or between the District of Columbia and any State or States or foreign nations, is hereby declared illegal. Every person who shall make any such contract or engage in any such combination or conspiracy, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court.

Sec. 4. "The several circuit (now district) courts of the United States are hereby invested with jurisdiction to prevent and restrain

violations of this act; and it shall be the duty of the several district attorneys of the United States, in their respective districts, under the direction of the attorney general, to institute proceedings in equity to prevent and restrain such violations. Such proceedings may be by way of petition setting forth the case and praying that such violation shall be enjoined or otherwise prohibited. When the parties complained of shall have been duly notified of such petition the court shall proceed, as soon as may be, to the hearing and determination of the case; and pending such petition and before final decree, the court may at any time make such temporary restraining order or prohibition as shall be deemed just in the premises.

Sec. 5. "Whenever it shall appear to the court before which any proceeding under section four of this act may be pending, that the ends of justice require that other parties should be brought before the court, the court may cause them to be summoned, whether they reside in the district in which the court is held or not; and subpoenas to that end may be served in any district by the marshal thereof.

Sec. 6. "Any property owned under any contract or by any combination, or pursuant to any conspiracy (and being the subject thereof) mentioned in section one of this act, and being in the course of transportation from one State to another, or to a foreign country, shall be forfeited to the United States, and may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure, and condemnation of property imported into the United States contrary to law.

Sec. 7. "Any person who shall be injured in his business or property by any other person or corporation by reason of anything forbidden or declared to be unlawful by this act, may sue therefor in any circuit [district] court of the United States in the district in which the defendant resides or is found, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the costs of suit, including a reasonable attorney's fee.

Sec. 8. "That the word 'person,' or 'persons,' whenever used in this act shall be deemed to include corporations and associations existing under or authorized by the laws of either the United States, or the laws of any of the Territories, the laws of any State, or the laws of any foreign country."

Does the Sherman Act Apply to Manufactures? For many years the Sherman Act lay dormant upon the statute books. It had been passed in response to a vague but strong popular sentiment; its meaning was indefinite and its possible interpretation doubtful. The first question that came up under the law was-does the act apply to combinations of manufacturers? The decision in the case of United States v. E. C. Knight Sugar Refining Company, 17. in 1895 was, as we have seen, that the law was designed to

apply to commerce not manufactures, that manufacturing did not lie within the control of Congress and that a combination of sugar refiners, even though it were made to form a monopoly, was not a violation of the law unless these same refiners or manufacturers attempted also to monopolize interstate commerce in sugar.

The Knight case has been greatly misunderstood although the principle which it decides, that manufacturing is not commerce, is comparatively simple. This by no means implies that a manufacturing company, which also engages in interstate trade by selling its products across State lines, is exempt from the provisions of the act. This was the essential point of the decision in Swift et al. v. United States, 196 U. S. 375; 1905. In this suit the Government accused a number of meat packing concerns, situated in Chicago and other points, of a combination in restraint of trade and asked the Federal court to grant an injunction forbidding the continuance of the combine. The Government maintained that the packers had agreed (a) not to bid against each other in purchasing live stock; that they thereby kept down the price of steers in the open market; (b) that they had raised prices temporarily in order to induce large numbers of shippers to consign heavy shipments of cattle to the stock yards in Chicago and other cities; after a great number of steers had been so received in the yard the representatives of the packing companies by agreement refused to buy, thereby causing a heavy fall in prices and enabling their companies to buy in the entire supply at a greatly reduced rate; (c) that the companies had conspired together through their representatives at various retail points to fix the prices of fresh meats to the retailers; (d) that they also by agreements, had arranged uniform terms of sale to the retailers and that certain retailers who had refused to conform to these terms were blacklisted by all the companies and thereby prevented from obtaining adequate supplies of fresh meat; (e) that the companies had also agreed together to charge a uniform scale of cartage fees, this scale being so high as to form a heavy and improper burden upon the retail trade; (f) that they had entered into conspiracies with the railways and thereby secured lower freight rates on their products than were granted to their competitors. The lower court held that these acts constituted restraint of trade and it accordingly granted the injunction. The packers appealed to the Supreme Court which considered the case in a lengthy opinion and decided that the various acts above mentioned were a combination in restraint of trade and would accordingly be a violation of the law. The injunction was upheld and the principle established that combinations not to compete or to impose oppressive terms and conditions upon buyer or seller, were contrary to the Sherman Act. The Act Applied to the Railways.-The next two problems, which arose together, were: Does the Act apply to railways also, and is it intended to prohibit only unreasonable combinations in restraint of trade, such as those forbidden by the English common law? Both