source: Caselaw Access Project

author: Mr. Justice Brennan

license: Public Domain

text:
    HOUSTON INSULATION CONTRACTORS ASSOCIATION v. NATIONAL LABOR RELATIONS BOARD.
    No. 206.
    Argued January 19, 1967.
    Decided April 17, 1967.

      W. D. Deakins, Jr., argued the cause and filed briefs for petitioner in No. 206 and for respondent in No. 413.

      Norton J. Come argued the cause for respondent in No. 206 and for petitioner in No. 413. With him on the brief were Solicitor General Marshall, Arnold Ordman and Dominick L. Manoli.

      Together with No. 413, National Labor Relations Board v. Houston Insulation Contractors Association, also on certiorari to the same court.

   Mr. Justice Brennan

delivered the opinion of- the Court.

These are companion cases to Nos. 110 and 111, National Woodwork Mfrs. Assn. v. NLRB, and NLRB v. National Woodwork Mfrs. Assn., ante, p. 612. A provision of the collective bargaining agreement between the Houston Insulation Contractors Association and Local 22, International. Association of Heat and Frost Insulators and Asbestos Workers, AFL-CIO, provides, in pertinent part, that the employer will not contract out work relating to “the preparation, distribution and application of pipe and boiler coverings.” In No. 206, the Contractors Association seeks review of the dismissal by the National Labor Relations Board, 148 N. L. R. B. 866, affirmed by the Court of Appeals for the Fifth Circuit, 357 F. 2d 182, 189, of §8 (b)(4)(B) charges brought against Local 22 because of its activities designed to enforce the agreement. National Labor Relations Act, as amended, 73 Stat. 543. In No. 413, the Board challenges the holding of the Court of Appeals, reversing the Board, that similar conduct by a sister Local 113, designed to protect the work guaranteed to Local 22 by the agreement, violated §8 (b)(4)(B). We granted both petitions and set them for argument with Nos. 110 and 111. We affirm in No. 206 and reverse in No. 413.

No. 206: Johns-Manville Company, a member of the Contractors Association, engaged in a construction project in Texas City, Texas, purchased from Techalloy Corporation, a manufacturer of insulation materials, stainless steel bands used to fasten asbestos material around pipes to be insulated. The bands had been pre-cut to specification by Tech alloy’s employees. Customarily, Johns-Manville had ordered rolls of wire which were then cut to size by members of Local 22. The cutting work was reserved for Johns-Manville employee members of Local 22 by the quoted provision of .the collective bargaining agreement between the Association an d the Local. Agents of Local 22 instructed its members on the jobsite not to install the precut bands. After the hearing on the complaint issued on the Contractors Association’s charge that this conduct violated § 8 (b)(4)(B), the Board held that “[t]he conduct complained of herein was taken to protest ... a deprivation of work, its object being to protect or preserve for employees'certain work customarily performed by them. This conduct constituted primary activity and is protected by the Act . . . .” 148 N. L. R. B., at 869. The Court of Appeals found that there was substantial evidence to support this fíñding and sustained it. The Association here attacks the substantiality of the evidence supporting the Board’s finding, but we agree with the Court of Appeals. See Universal Camera Corp. v. Labor Board, 340 U. S. 474. In that circumstance our holding today in National Woodwork Mfrs. Assn. v. NLRB, supra, requires an affirmance in No. 206.

No. 418: Armstrong Company, a member of thé Contractors Association, was engaged in a construction project in Victoria, Texas, within the jurisdiction of Local 113 of the Heat and Frost Insulators and Asbestos Workers. The cutting and mitering of asbestos fittings for such jobs was customarily performed at Armstrong’s Houston shop, which was within Local 22’s jurisdiction. Armstrong purchased from Thorpe Company, a manufacturer of insulation materials, asbestos 'fittings upon which the cutting and mitering work had already been performed. Agents of Local 113 informed Armstrong that fittings would not be installed unless the cutting and mitering had been performed by its sister Local 22 as provided by Local 22’s bargaining agreement. The Board found, as it had in No. 206, that the object of this refusal was primary — the preservation of work customarily performed by Armstrong’s own employees. 148 N. L. R. B., at 869. - The Court of Appeals reversed on the ground tha,t Local 113 “had no economic interest in Local 22’s claim of breach of contract,” and that therefore “it was coercing Armstrong not for its own benefit but for the benefit of another local at the expense of a neutral employer.” 357 F. 2d, at 189. We disagree.

. National Woodwork 'Mfrs., supra, holds that collective activity by employees of the primary employer, the object of which is to affect the labor policies of that primary employer, and not engaged in for its effect elsewhere, is protected primary activity. “Congress was not concerned to protect primary employers against pressures by disinterested unions, but rather to protect disinterested employers against direct pressures by any union.” The finding of the Board, supported by substantial evidence, was that Local 113’s object was to influence Armstrong in a dispute with Armstrong employees, and not for its effect elsewhere.

Primary employees have traditionally been assured the right to take concerted action against their employer to gain the “mutual aid or protection” guaranteed by § 7 of the National Labor Relations Act, as amended, 61 Stat. 140, whether or not the resolution of the particular dispute directly affects all of them. As Judge Learned Hand stated in Labor Board v. Peter Cailler Kohler Swiss Chocolates Co., 130 F. 2d 503, 505-506:

“When all the other workmen in a shop make common cause with a fellow workman over his separate grievance, and go out on strike .in his support, they engage in a ‘concerted activity’ for ‘mutual aid or protection/ although the aggrieved workman is the only one of them who has any immediate stake in the outcome. The rest know that by their action each one of them assures himself, in case his turn ever comes, of the support of the One whom they are all.then helping; and the solidarity so established is ‘mutual aid’ in the most literal sense, as nobody doubts.”

. A boycott cannot become secondary because engaged in by primary employees not directly affected by the dispute, or because only engaged in by some of the primary employees, and not the entire group. Since that situation does not involve'the employer in a. dispute not his own, his employees’ conduct in support of their fellow employees is not secondary and, therefore, not a violation ■of §8 (b)(4)(B).

The judgment of the Court of Appeals in No. 206 is affirmed and in No. 413 is reversed.

Tt. is so ordered.

Mb. Justice Black, Mb. Justice Douglas, Mb. Justice Clark, and Mb. Justice Stewart dissent for the reasons expressed in Mb. Justice Stewart’s dissenting opinion in National Woodwork Mfrs. Assn, v, NLRB, ante, p. 650.

       The Association did not charge the Union with violation of §8(e) (73 Stat. 543), and the .validity of the work-preservation clause was not an issue in the hearing before the Board. But the Board appears to have assumed that the clause was valid in holding that the object of the Union’s conduct pursuant thereto was a primary one of work preservation. The Court of Appeals expressly held, as an aspect’of its finding that § 8(b)(4)(B) was not violated by Local 22’s ’ activities, that the clause was valid. 357 F. 2d, at 188-189.

       A mitered fitting is described by the president of Thorpe Company as “an insulation item that is used to cover something other than a straight piece of pipe in a pipe line, and this is made by taking standard insulation pipe covering and cutting it on a bias or miter and then gluing it together or sticking it together so that it will conform to the fitting that you are trying to shape it to.”

        United Association of Journeymen, Local 106 (Columbia-Southern Chemical Corporation), 110 N. L. R. B. 206, 209.


author: Per Curiam. Mr. Justice Douglas, Mr. Justice White,

text:
    THORPE v. HOUSING AUTHORITY OF THE CITY OF DURHAM.
    No. 712.
    Argued March 21, 1967.
    Decided April 17, 1967.

      James M. Nabrit III argued the cause for petitioner. With him on the briefs were Jack Greenberg, Charles Stephen -Ralston,■ Charles H. Jones, Jr., and Michael Meltsner. ' ,
    . Daniel K. Edwards argued the cause for respondent. With him on the brief was William Y. Manson.

   Per Curiam.

' In -November. 1964, the petitioner became a tenant in McDougald Terrace, a federally assisted, low-rent public housing project owned and managed by the Housing - Authority of the City of Durham, North Carolina. The lease provided for a tenancy from month to month, and gave both the tenant and the Authority the right to. terminate by giving notice at least 15 days before the end .of any monthly term. On August 10, 1965, the petitioner was elected president of a McDougald Terrace tenants’ organization. The next day the Authority gave her notice of termination of her tenancy as of August 31. • The notice did not give any reasons for the cancellation, and the Authority declined to accede to the petitioner’s demands for an explanation. The petitioner refused to' vacate the premises, and the Authority thereupon brought a summary ejectment action in the Justice of the Peace Court in Durham. The Authority there obtained a judgment of eviction, which- was affirmed on appeal by the Superior Court of Durham County and the Supreme Court of North Carolina.. We granted certiorari. 385 U. S. 967. Th<? petitioner has remained in possession of her apartment pursuant to a stay granted by the North Carolina Supreme Court.

The petitioner contends that she was constitutionally entitled to notice setting forth the reasons for the termination of her lease, and a hearing fhereon. She also suggests that her eviction was invalid because it allegedly was based on her participation in constitutionally protected associational activities. We find it unnecessary to reach the large issues stirred by these claims, because of a significant development that has occurred since we granted the writ of certiorari.

On February 7, 1967, the Department of Housing and Urban Development issued a directive to local'housing authorities. After reciting the fact that dissatisfaction had been expressed with eviction procedures in loW-rent housing projects and that suits had been brought to challenge evictions in which the local authority had not given any reason for its action, the circular stated:

“Since this is a federally assisted program, we believe it is essential that no tenant, be given notice to vacate without being told by the Local Authority, in a private conference or other appropriate manner, the reasons for the eviction, and given an opportunity to'make such reply or explanation as he may wish.”

The circular goes on to require local authorities to keep future records of evictions, the reasons therefor, and summaries of any conferences held with tenants in connection with evictions.

While the directive provides that certain records shall. - be kept commencing with the date of its issuance, them'is no suggestion that the basic procedure it prescribes is not to be followed in all eviction proceedings that have not become final. If this procedure were accorded to the petitioner, her case would assume a posture quite different from the one now presented. Compare Wabash R. Co. v. Public Service Comm’n, 273 U. S. 126, 131; Patterson v. Alabama, 294 U. S. 600, 607; Klapprott v. United States, 335 U. S. 601.

The judgment of the Supreme Court of North Carolina is accordingly vacated, and the case remanded for such further proceedings as may be appropriate in the light of the February 7 circular of the Department of Housing and Urban Development.

/É ⅛ so ordered.

Mr. Justice Douglas,

concurring.

Petitioner and her children have been tenants in a low-income.housing project constructed with federal and state funds and operated by the Housing Authority of the City of Durham, an agency of the' State of North Carolina. The Housing Authority was established under state law and is “a public body and a body corporate and politic, exercising public powers." N. C. Gen. Stat. § 157-9 (1964). It has “all the powers necessary or convenient to carry out and effectuate the purposes and pro-. visions” of the North Carolina Housing Authorities Law (N. C. Gen. Stat. § 157-1 et seq. (1964)), including the powers “to manage as agent of any city or municipality . . . any housing project constructed or owned by such city” and “to act'as agent for the federal government-in connection with the acquisition,-* construction, operation and/or, management of a housing project.” Id., § 157-9 (1964).

The lease under which petitioner has occupied the project had an initial term from November 11 to November 30, 1964, and provided that it would be automatically renewed thereafter:, for successive terms of one month, provided there were no changes in income or family com-' position and no violations of the lease terms. The lease provides that “[t]he Management may terminate this lease by giving to the Tenant notice in writing of such termination fifteen . . . days prior to the last day of the term.” The lease “shall be automatically terminated at the option of the Management” with an immediate right of re-entry and all notices required by law waived, if the tenant, misrepresents a material fact in his application or if “the Tenant fails to comply with any of the provisions of [the] lease.”

As I have said, petitioner and her children moved into their home in the project on November 11, 1964. All apparently went well for eight months; the record reveals no complaints from the manager of the housing project. On August 10, 1965, petitioner was elected president of the Parents’ Club, a group composed of tenants of the housing project. On August 11, 1965, the Housing Authority’s Executive Director delivered a notice that petitioner’s lease would be canceled effective August 31, at which time she would have to vacate the premises. No reasons were given for the sudden cancellation. The Authority merely referred to the provision of the lease stating that management may terminate the lease by giving the tenant notice 15 days prior to the last day of the term.

Petitioner requested a hearing to' determine the reason for the termination; the request was summarily denied. Since she was given no reason and no hearing, petitioner refused to vacate her home. The Housing Authority brought a summary ejectment action in the Justice of the Peace Court of Durham; the court ordered that petitioner and her family be removed from their home. Petitioner appealed to the Superior Court. It was stipulated that the Superior Court could hiake findings and decide the case on the basis of the stipulations and affidavits. Petitioner’s motion to quash claimed that her “eviction primarily resulted from her community activities as an organizer of tenants, thus constituting an unconstitutional abridgement of her freedom of expression and a denial of equal protection- of the laws.” Her affidavit alleged “that her eviction was prompted by [the] Manager of the Housing Authority, who wants to get he? out of the project because' of her efforts to organize the tenants of [the housing project] . . . .” It was stipulated that the Executive Director of the Housing Authority would testify that “whatever reason there-may have been, if any, for giving notice to [petitioner] of the termination of her lease, it was not for the reason that she was elected president of any group organized in [the housing project] . . . .” (Emphasis added.) The Superior Court found that petitioner had not been evicted due to her efforts to organize the tenants nor due to her election as president of the Parents’. Club. The court held that the Housing Authority was not required to give petitioner a hearing and was not required to give any reason for the lease termination.

The North Carolina Supreme Court affirmed. 267 N. C. 431, 148 S. E. 2d 290. It held that the Housing Authority is the “owner” of the apartment and that petitioner “has no right to occupy it except insofar as such right is conferred upon her by the written lease which she and the [Housing Authority] signed.” Id., at 433, 148 S. E. 2d, at 291. Since petitioner had refused to quit after the Housing Authority terminated the lease,' she could be evicted so as to restore to the Authority “the possession of that which belongs to it.” Id., at 433, 148 S. E. 2d, at 291-292. The court thought it “immaterial what may have been the reason for the lessor’s unwillingness to continue the relationship of landlord and tenant . . . .” Id., at 433, 148 S. E. 2d, at 292. Under the rationale of the North Carolina Supreme Court, a public housing authority, organized under state law and operating a housing project financed by federal and' state funds, is assimilated to the position of a private property owner who can terminate a lease for any reason or no reason at all.

The circular upon which the Court bases its decision to vacate and remand comes from the office of the Assistant Secretary for Renewal and Housing Assistance and was issued February 7, 1967, after we granted certiorari. It is directed to “Local Housing Authorities, Assistant Regional Administrators for Housing Assistance,' and HAA Division and Branch Heads” and reads in part:

“Since this is a federally assisted program, we believe • it is essential that no tenant be given notice to vacate without being told by the Local Authority, in a private conference or other appropriate manner, the reasons for the eviction, and given an opportunity to make such reply or explanation as he may wish.”

It goes on to provide that “[i]n addition to informing the tenant of the reason(s) for any proposed eviction action, from this date each Local Authority shall maintain a written record of every eviction from its federally assisted public housing,” specifies the information to be contained in the record and provides that the records are to be available to HUD representatives for review.

This circular superseded a prior circular which stated that the' Public Housing Administration “strongly urge[s], as a matter of good social policy, that Local Authorities in a private conference inform any tenants who are given [notices to vacate] of the reasons for this action.”

This case presents two issues, neither of which is resolved by the circular. The first is whether a tenant in a publicly assisted housing project operated by a state agency can be evicted for any reason or no reason at all. The second is whether a tenant in such a housing project can be evicted for the exercise of a First Amendment right.

The circular merely provides that the tenant be told “the reasons for the eviction-, and [be] given an opportunity to make such reply or explanation as he may wish.” .From this it may be inferred that the Housing Authority must have a reason for the eviction. But the circular does not specifically state the reasons which can support eviction; it does not state that a tenant cannot be evicted for his stand on. civil rights; it does not even broach the subject. It is argued that the circular provides that the lease can be terminated only after an administrative hearing. It certainly would be desirable if. a housing authority held a hearing prior to the termination of the lease. The circular, which may be no more than a press release, does not so provide. Moreover, is there a constitutional requirement for an administrative hearing where, as here, the tenant can have a full judicial hearing when the authority attempts to evict him through judicial process? Petitioner has had a hearing in the state courts. The immediate question is what reasons can support an eviction after hearing.

Over and over again we have stressed that “the nature and the theory of our institutions of government, the principles upon which they are supposed to rest ... do not mean to leave room for the play and action of purely personal and arbitrary power” (Yick Wo v. Hopkins, 118 U. S. 356, 369-370) and that the essence of due process is “the protection of the individual against arbitrary action.” Ohio Bell Telephone Co. v. Public Utilities Comm’n, 301 U. S. 292, 302; Slochower v. Board of Education, 350 U. S. 551, 559., Any suggestion to the contrary “resembles the philosophy of feudal tenure.” Reich, The New Property, 73 Yale L. J. 733, 769. It is not dispositive to maintain that'a private landlord might terminate a lease at his pleasure. For this is government we are dealing with, and the actions of government are circumscribed by the Bill of Rights and the Fourteenth Amendment. “The government as landlord is still the government. It must not act arbitrarily, for, ^unlike private landlords, it is subject to the requirements of due process of law. Arbitrary action is not due process.” Rudder v. United States, 96 U. S. App. D. C. 329, 331, 226 F. 2d 51, 53.

The recipient of a government benefit, be it a tax exemption (Speiser v. Randall, 357 U. S. 513), unemployment compensation (Sherbert v. Verner, 374 U. S. 398), public employmént (Slochower v. Board of Education, 350 U. S. 551), a license to practice law (Spevack v. Klein, 385 U. S. 511), or á home in a public housing project, cannot be made to forfeit the benefit because he exercises a constitutional right. In United States v. Chicago, M., St. P. & P. R. Co., 282 U. S. 311, 328-329, the Court said that “the right to continue the exercise of a privilege granted by'the state cannot be made to depend upon the grantee’s submission to a condition prescribed by the state which is hostile to the provisions of the federal Constitution.” This was in the tradition of Frost Trucking Co. v. Railroad Comm’n, 271 U. S. 583, 594, where the Court emphasized that “If the state may compel the surrender of one constitutional right ás a condition of its favor, it may, in like manner, compel a surrender of all. It is inconceivable that guaranties embedded in the Constitution of the United States may thus be manipulated out of existence.” In Speiser v. Randall, supra, at 518, we recognized that “To deny an exemption to claimants who engage, in- certain forms of speech is in effect to penalize them for such speech. Its deterrent effe9t is the same as if the State were to fine them for this speech. The appellees áre plainly mistaken in their argument that, because a tax exemption is a 'privilege’ or 'bounty,’ its denial may not infringe speech.” No' more can a tenant in a public housing project be evicted for the exercise of her right of association, a right protected by the First and Fourteenth Amendments. See, e. g., NAACP v. Alabama, 357 U. S. 449, 460; Bates v. Little Rock, 361 U. S. 516, 523; Shelton v. Tucker, 364 U. S. 479, 486; Louisiana v. NAACP, 366 U. S. 293, 296; NAACP v. Button, 371 U. S. 415, 430-431.

This does not mean that a public housing authority is powerless to evict a tenant. A tenant may be evicted if it is shown that he is destroying the fixtures, defacing the walls, disturbing other tenants by boisterous conduct and for a number of other reasons which impair the successful operation of the housing project. Eviction for such reasons will completely protect the viability of the housing project without making the tenant a serf who has a home at the pleasure of the manager of the project or the housing, authority.

Here, the Superior Court found that petitioner had not been evicted because she had engaged in efforts to organize the tenants of the housing project or because she had been elected president of the Parents’ Club. On appeal to the North Carolina Supreme Court, petitioner contended that the finding was. erroneous. The State Supreme Court did not pass on the finding of the Superior Court since it concluded that the Housing Authority could terminate the lease and evict petitioner for any reason. As I have said, it is argued that the circular of the Department of Housing and Urban Development answers petitioner’s claim that she was entitled to an administrative hearing before her lease was terminated. But petitioner has already had a hearing in the state courts. And the status of the circular, whether a regulation or only a press release, is uncertain, an uncertainty which the Court does not remove. Vacating and remanding “for such further proceedings as may be appropriate in the light of the . . . circular” therefore furnishes no guidelines for the state courts on remand, and does not dispose of . the basic issue presented. I would vacate and remand to the state courts to determine the precise reason why petitioner was evicted and whether that reason was within the permissible range for state action against the individual.

Mr. Justice White,

dissenting.

I would agree with Mr. Justice Douglas that there are reasons for which the Authority could not terminate petitioner’s lease and that the ground alleged by the petitioner to be the cause of her eviction is one of them. The trial court rejected petitioner’s allegations. This finding was affirmed by the North Carolina Supreme Court as supported by the evidence, although it did say, erroneously I think, that the reasons for the eviction were “immaterial.” There could have been a more adequate record made as to the basis for the eviction but petitioner was afforded a full due process hearing in the lower court and had the opportunity to explore fully why she was evicted. I do not view the federal circular as significant to the resolution of this ease, and would not remand on that basis.

I would affirm.

       267 N. C. 431, 148 S. E. 2d 290.

       In the Superior Court proceedings, it was stipulated' and agreed: “that if Mr. C. S. Oldham, the'Executive Director of the Housing Authority of the City of Durham, were present and duly sworn and were testifying,' he would testify that whatever reason there may have been, if any, for giving notice to Joyce C. Thorpe of the termination of her lease, it was not for the reason that she was elected president of any group organized in McDougald Terrace, and specifically it was not for the reason- that she was elected president of any group organized in McDougald Terrace on August 10, 1965 . . . .” '

       The text of the circular is as follows:
      “SUBJECT: Terminations of Tenancy in Low-Rent Projects
      “Within the past year increasing dissatisfaction has been expressed with eviction practices in public low-rent housing projects. During that period a number of suits have been filed throughout the United States generally challenging the right of á Local Authority to evict a tenant without advising him of the reasons for such eviction.
      “Since this is a federally assisted program, we believe it is essential that no tenant be given notice to vacate without, being told by the Local Authority, in a private conference or other appropriate manner, the reasons for the eviction, and given an opportunity to make such reply or explanation as he. may wish.
      “In addition to informing the tenant of the reason(s) for any proposed eviction action, from this date each Local Authority shall maintain a written record of every eviction from its federally assisted public housing. Such records are to be available for review from time to time by HUD representatives and shall contain the following information:
      “1. Name of tenant and identification of unit occupied.
      “2. Date of notice to vacate.
      “3. Specific reason (s) for notice to vacate. For example, if a tenant is being evicted because of undesirable actions, the record should detail the actions which resulted in the determination that eviction should be instituted.
      “4. Date and method of notifying tenant with summary of any conferences with tenant, including names of conference participants.
      “5/Date and description of final action taken.
      “The Circular on the above subject from the PHA Commissioner, dated May 31, 1966, is superseded by this Circular.
      “[s] Don Hummel

        “Assistant Secretary for Renewal

        “and Housing Assistance”

      The superseded circular of May 31, 1966, státed that the federal authorities “strongly urge, as a matter of good social policy, that Local Authorities in a private conference inform any tenants who are given [eviction] notices of the reasons for this action.”

       Although the circular does not specify the authority under which it is issued, federal authorities are given general statutory power to make “such- rules and regulations as may be necessary to carry out” federal programs for assistance to low-rent housing projects. United States Housing Act. of 1937, § 8, 50 Stat. 891, as amended, 42 U. S. C. § 1408. The legal effect of the circular, the extent to which it binds local housing authorities, and whether it is in fact applicable to the petitioner are questions we do not now decide.

      In the statement of facts preceding the names of counsel, there is an assertion that “[t]he [Superior] [C]ourt made findings of fact, each of which is supported by stipulations or by the evidence in the record.” 267 N. C., at 432, 148 S. E. 2d, at 290-291. Following this is a recitation of the findings of the Superior Court, includ--ing the finding that “[w]hatever may have been the [Authority’s] reason for terminating the lease, it was neither that the defendant had engaged in efforts to organize the tenants of [the' housing project] nor that she was elected president of a group which was organized in [the housing project] . . . .” Id., at 432, 148 S. E. 2d, at 291. My Brother White argues that this amounted to an affirmance of the Superior Court’s finding as supported by the evidence. But, to me, suoh a claim is belied' by the court’s statement, in the body of its opinion, that it was “immaterial what may have been the reason for the lessor’s unwillingness to continue the relationship of landlord and tenant.” Id., at 433, 148 S. E. 2d, at 292.- This indicates that the North Carolina Supreme Court did not make an independent review of the record to determine whether the Superior Court’s finding as to the cause of eviction was supported by the evidence since it thought the reason for eviction immaterial,..

      The statement of facts in the Supreme Court opinion, upon which I indeed rely, see footnote of my Brother Douglas’ concurring opinion, is, as I understand it, prepared by the court and in North Carolina is considered official.


author: Per Curiam.

text:
    LAVERNE et al. v. INCORPORATED VILLAGE OF LAUREL HOLLOW et al.
    No. 984.
    Decided April 17, 1967.

      Monroe H. Freedman for appellants.
   Per Curiam.

The motion to dismiss is granted and the appeal is dismissed for the reason that the judgment sought to be reviewed rests upon an adequate state ground.


author: Per Curiam;

text:
    WALKER v. ARKANSAS.
    No. 1014.
    Decided April 17, 1967.

      Fletcher Jackson for appellant.

      Joe Purcell, Attorney General of Arkansas, for appellee.
   Per Curiam;

The motion to dismiss is granted and the appeal is dismissed for want of jurisdiction. Treating the papers whereon the appeal was taken as a petition for a writ of certiorari, certiorari is denied.


text:
    STEWART et al. v. INDUSTRIAL COMMISSION OF ILLINOIS et al.
    No. 1034.
    Decided April 17, 1967.

      Bernard Kleiman, Gilbert A. Cornfield, Gilbert Feld-man, Jason Gesmer and Alton Sharpe for appellants.

      Harlan L. Hackbert for appellees.
   Per Curiam.

The motion to dismiss is granted and the appeal is dismissed for want of jurisdiction.

Treating the papers whereon the appeal was taken as a petition for a writ of certiorari, certiorari is denied.


text:
    DACEY et al. v. GRIEVANCE COMMITTEE OF THE BAR OF FAIRFIELD COUNTY.
    No. 1049.
    Decided April 17, 1967.

      George A.-Saden for appellants.

      David Goldstein and Jacob D. Zeldes for appellee.
   Per Curiam.

The motion to dismiss is granted and the appeal is disioissed for want of a substantial federal question.


text:
    MILLER BREWING CO. v. JONES, DIRECTOR OF REVENUE OF ILLINOIS.
    No. 1067.
    Decided April 17, 1967.

      Frank H. Uriell and Paul A. Teschner for appellant.

      William O. Clark, Attorney General of Illinois, and Richard A. Michael and John J. O’Toole, Assistant Attorneys General, for appellee.
   Per Curiam.

The motion to dismiss is granted and the appeal is dismissed for want of a substantial federal question.


author: Mr. Justice White Mr. Justice Stewart,

text:
    UTAH PIE CO. v. CONTINENTAL BAKING CO. et al.
    No. 18.
    Argued January 17, 1967.
    Decided April 24, 1967.

      Joseph L. Alioto argued the cause and filed briefs for petitioner.

      John H. Schafer argued the cause and filed .a brief for Continental Baking Co., Peter W. Billings argued the cause and filed a brief for Carnation Co., and George P. Lamb argued the cause and filed a brief for Pet Milk Co., respondents.
   Mr. Justice White

delivered the opinion of the Court.

This suit for treble damages and injunction under §§4 and 16 of the Clayton Act, 38 Stat. 731, 737, 15 U. S. C. §§ 15 and 26 was brought by petitioner, Utah Pie Company, against respondents, Continental Baking Company, Carnation Company and Pet Milk Company. The complaint charged a conspiracy under §§ 1 and 2 of the Sherman Act, 26 Stat. 209, as amended, 15 U. S. C. §§ 1 and 2, and violations by each respondent of § 2(a) of the Clayton. Act as amended by the Robinson-Patman Act, 49 Stat. 1526, 15 U. S. C. § 13 (a). The jury found for respondents on the conspiracy charge and for petitioner on the price discrimination charge. Judgment was entered for petitioner for damages and attorneys’ fees and respondents appealed on several grounds. The Court of Appeals reversed, addressing itself to the single issue of whether the evidence against each of the respondents was sufficient to support a finding of probable injury to competition within the meaning of § 2 (a) and holding that it was not. 349 F. 2d 122. We granted certiorari. 382 U. S. 914. We reverse.

The product involved is frozen dessert pies — apple, cherry, boysenberry, peach, pumpkin, and mince. The period covered by the suit comprised the years 1958,1959, and 1960 and the first eight months of 1961. Petitioner is a Utah corporation which for 30 years has been baking pies in its plant in Salt Lake City and selling them in Utah and surrounding States. It entered the frozen pie business in late 1957. It was immediately successful with its new line and built a new plant in Salt Lake City in 1958; The frozen pie market was a rapidly expanding one: 57,060 dozen frozen pies were sold in the Salt Lake City market in 1958,111,729 dozen in 1959,184,569 dozen in 1960, and 266,908 dozen in 1961. Utah Pie’s share of this market in those years was 66.5%, 34.3%, 45.5%, and 45.3% respectively, its sales volume steadily increasing over the four years. Its financial position also improved. Petitioner is not, however, a large company. At the time of the trial, petitioner operated with only 18 employees, nine of whom were members of the Rigby family, which controlled the business. Its net worth increased from $31,651.98 on October 31, 1957, to $68,802.13 on October 31, 1961. Total sales were $238,000 in the year ended October 31, 1957, $353,000 in 1958, $430,000 in 1959, $504,000 in 1960 and $589,000 in 1961., Its net income or loss for these same years was a loss of $6,461 in 1957, and net income in the remaining years of $7,090, $11,897, $7,636, and $9,216.

Each of the respondents is a large company and each of them is a major factor in the frozen pie market in one or more regions of the country. Each entered the Salt Lake City frozen pie market before petitioner began freezing dessert pies. None of them had a plant in Utah.. By the end of the period involved in this suit Pet had plants in Michigan, Pennsylvania, and California; Continental in Virginia, Iowa, and California; and Carnation in California. The Salt Lake City market was supplied by respondents chiefly from their California operations. They sold primarily on a delivered price basis.

The “Utah” label was petitioner’s proprietary brand. Beginning in 1960, it also sold pies of like grade and quality under the controlled label “Frost ’N’ Flame” to Associated Grocers and in 1961 - it began selling to American Food Stores under the “Mayfresh” label. It also, on. a seasonal basis, sold pumpkin and mince- frozen pies to Safeway under Safeway’s own “Bel-air” label.

The major competitive weapon in. the Utah market was price. The location of petitioner’s plant gave it natural advantages in the Salt Lake City marketing area and it entered the market at a price below. the then, going prices for respondents’ comparable pies. For most of the period involved here its prices were the lowest in the Salt Lake City market. It was, however, challenged by each of the respondents at one time or another and for varying periods. There was ample evidence to show that each of the respondents contributed to what proved to be a deteriorating price structure over the period covered by this suit, and each of the respondents in the course of the ongoing price competition sold frozen pies in the Salt Lake market at prices lower than it sold pies of like grade and quality in other markets considerably closer to its plants.. Utah Pie, which entered the market at a price of $4.15 per dozen at the beginning of the relevant period, was selling “Utah” and “Frost ’N’ Flame” pies for $2.75 per dozen when the instant suit was filed some 44 months later. Pet, which was offering pies at $4.92 per dozen in February 1958, .was offering “Pet-Ritz” and “Bel-air” pies at $3.56 and $3.46 per dozen respectively in March and April 1961. . Carnation’s price in early 1958 was $4.82 per dozen but it was selling at $3.46 per dozen at the conclusion of the period, meanwhile having been down as low as $3.30 per dozen. The price range experienced by Continental during the period covered by this suit ran from a 1958 high of over $5 per dozen to a 1961 low of $2.85 per dozen.

I.

We deal first with petitioner’s case against the Pet Milk Company. Pet entered the frozen pie business in 1955, acquired plants in Pennsylvania and California and undertook a large advertising campaign to market its “Pet-Ritz” brand of frozen pies. Pet’s initial emphasis .was on quality, but in the face of competition from regional and local companies and in an expanding market where price proved to be a crucial factor, Pet was forced to take steps to reduce the price of its pies to the ultimate consumer. These developments had consequences in the Salt Lake City market which, are the substance of petitioner’s case against Pet.

First, Pet successfully concluded an arrangement with Safeway, which is one of the three largest customers for frozen pies in the Salt Lake market, whereby it would sell frozen pies to Safeway under the latter’s own “Belair” label at a price significantly lower than it was selling its comparable “Pet-Ritz” brand in thg same Salt Lake market and elsewhere. The initial price on “Belair” pies was slightly lower than Utah’s price for its “Utah” brand of pies at the time, and near the end of the period the “Bel-air” price was comparable to the “Utah” price but higher than Utah’s “Frost ’N’ Flame” brand. Pet’s Safeway business amounted to 22.8%, 12.3%, and 6.3% of the entire Salt Lake City market for the years 1959, 1960, and 1961, respectively, and to 64%, 44%,- and 22% of Pet’s own Salt Lake City sales for those same years. •

Second, it introduced a 20-ounce economy pie under the “Swiss Miss” label and began selling the new pie in the Salt Lake market in August 1960 at prices ranging from $3.25 to $3.30 for the remainder of the period. This pie was at times sold at a lower price in the Salt Lake City market than it was sold in other markets.

Third, Pet became more competitive with respect .to the prices /or its “Pet-Ritz” proprietary label. For 18 of the relevant 44 months its offering price for Pet-Ritz pies was $4 per dozen or lower, and $3.70 or lower for six of these months. According to the Court of Appeals, in seven of the 44 months Pet’s prices in. Salt Lake were lower than prices charged in the California markets. This was true although selling, in Salt Lake involved a 30- to 35-cent freight cost.

The Court of Appeals first.concluded that Pet’s price differential on sales to Safeway must be put aside in considering injury to competition because in its view* of the evidence the differential had been completely cost justified and because Utah would not in any event have been able to enjoy the' Safeway custom. Second, it concluded that the remaining discriminations on “Pet-Ritz” and “Swiss Miss” pies were an insufficient predicate on which the jury.could have found a reasonably possible injury either to Utah Pie as a competitive force or to competition generally.

We disagree with the Court of Appeals in several respects. First, there was evidence from which the jury could have found considerably more price discrimination by Pet with respect to “Pet-Ritz” and “Swiss Miss” pies than , was considered by the Court of Appeals. In addition to the seven months during which Pet's prices in Salt Lake • were lower than prices in the California markets, there was evidence from which the jury could reasonably have found that in 10 additional months the Salt Lake City prices for “Pet-Ritz” pies were discriminatory as compared with sales in western markets other than California. Likewise, with respect to “Swiss Miss” pies, there was evidence in the record from which the jury could have found that in five of the 13 months during which the “Swiss Miss” pies were sold prior to the filing of this suit, prices in Salt Lake City were lower than those charged by Pet in either California or some other western market.

Second, with respect to Pet’s Safeway business, the burden of proving cost justification was on Pet and, in our view, reasonable men could have found that Pet’s lower priced, “Bel-air” sales to Safeway were not cost justified in their entirety. Pet introduced cost data for 1961 indicating a cost saving on the Safeway business greater than the price advantage extended to that customer. These statistics were not particularized for the Salt Lake market, but assuming that they were adequate to justify the 1961 sales, they related to only 24% -of the^ Safeway sales over the relevant period. The evidence concerning the remaining 76% was at best incomplete and inferential. It was insufficient to take the defense of cost justification from the jury, which reasonably could have found a greater incidence of unjustified price discrimination than that allowed by the Court of Appeals’ .view of the evidence.

With respect to whether Utah would have enjoyed Safeway’s business absent the. Pet contract with Safeway, it seems clear that whatever the fact is in this regard, it is not determinative of the impact of that contract on competitors other than Utah and on competition generally. There were other companies seeking the Safeway business, including Continental and Carnation, whose pies may have been excluded from the Safeway shelves by what the jury could have found to be discriminatory sales to Safeway. What is more, Pet’s evidence that Utah’s unwillingness to install quality control equipment prevented Utah from enjoying Safeway’s private label' business is not the only evidence in the record relevant to that question. There was other evidence to the contrary. The jury would not have been compelled to find that Utah Pie could not have gained more of the Safeway business.

Third, the Court of Appeals almost entirely ignored other evidence which provides material support for the jury’s conclusion that Pet’s behavior satisfied the statutory test regarding competitive injury. This evidence bore on the issue of Pet’s predatory intent to injure Utah Pie. As an initial matter, the jury could have con-eluded that Pet’s discriminatory pricing was aimed at Utah Pie; Pet’s own management, as early as 1959, identified Utah Pie as an “unfavorable factor,” one which “d[u]g holes in our operation” and .posed a constant “check” on Pet’s performance in the Salt Lake City market. Moreover, Pet candidly admitted that during the period when it was establishing its relationship with Safeway, it sent into Utah Pie’s plant an industrial spy to seek information that would be of use to Pet in convincing Safeway that Utah Pie was not worthy of its custom. Pet denied that it ever in fact used what it had learned against Utah Pie in competing for Safeway’s business. The parties, however, are not the ultimate judges of credibility. But even giving Pet’s view of the incident a.-measure of weight does not mean the jury was foreclosed from considering the predatory intent underlying Pet’s mode of competition. Finally, Pet does not deny that the evidence showed it suffered substantial losses on its- frozen pie sales during the greater part of the time in volved, in this suit, and there was evidence from which the jury could have concluded that the losses Pet sustained in Salt Lake City "were greater than those incurred elsewhere. It would not have been an irrational step if the jury concluded- that there was a relationship between price and the losses.

It seems clear to us that the jury heard adequate evidence from which it could have concluded that Pet had engaged in predatory tactics in waging competitive warfare in the Salt Lake City market. Coupled with the incidence of price discrimination attributable to Pet, the evidence as. a whole established, rather than negated, the reasonable possibility that Pet’s behavior produced a lessening of competition proscribed by the Act.

II.

Petitioner’s ease against Continental is not complicated. Continental was a substantial factor in the market in 1957. But its sales of frozen 22-ounce dessert pies, sold under the “Morton” brand, amounted to only 1.3% of the market in 1958, 2.9% in 1959, and 1.8% in 1960. Its problems were primarily that of cost and in turn that of price, the controlling factor in the market. In late 1960 it worked out a cor-packing arrangement in California by which fruit would be processed directly froin the trees into the finished pie without large intermediate packing, storing, and shipping expenses. Having improved its position, it attempted to increase its share of the Salt take City market by utilizing a local broker and offering short-term price concessions in varying amounts. Its efforts for seven months were not spectacularly successful. Then in June 1961, it took ihé steps which are the heart of petitioner’s complaint against it. Effective for the last two weeks of June it offered its 22-ounce frozen apple pies in the Utah area at $2.85 per dozen. It was then selling the same pies at substantially higher prices in other markets. The Salt Lake City price was less than its direct cost plus an allocation for overhead. Utah’s going price at the time for its 24-ounce “Frost ’N* Flame” apple pie sold to Associated Grocers was $3.10 per dozen, and for its “Utah” brand $3.40 per dozen. At its new prices, Continental sold pies to American Grocers in Pocatello, Idaho, and to American Food Stores in Ogden, Utah. Safeway, one of the major buyers in Salt Lake City, also purchased 6,250 dozen, its requirements for about five weeks. Another purchaser ordered 1,000 dozen. Utah’s response was immediate. It reduced its price on all of its apple pies to $2.75 per dozen. Continental refused Safeway’s request to match Utah’s price, but renewed its offer at the same prices effective July 31 for another two-week period. Utah filed suit on September 8, 1961. Continental’s total sales of frozen pies increased from 3,350 dozen in 1960 to 18,800 dozen- in 1961. Its market share increased from 1.8% in 1960 to 8.3% in 1961. The Court of Appeals concluded that Continental’s conduct had had only minimal effect, that it had not injured or weakened Utah Pie as a competitor, that it had not substantially lessened competition and that there was no reasonable possibility that it would do so in the future.

We again differ with the Court of Appeals. Its opinion that Utah was not damaged as a competitive force apparently rested on the fact that Utah’s sales volume continued to climb in 1961 and on the court’s own factual conclusion that Utah was not deprived of any pie business which it otherwise might have had. But this retrospective assessment fails to note that Continental’s discriminatory below-cost price caused Utah Pie to ¡reduce its price to $2.75. The jury was entitled to consider the potential impact of Continental’s price reduction absent any responsive price, cut by Utah Pie. Price was, a major factor in the Salt Lake City market. Safeway, which, had been buying Utah brand pies, immediately reacted and purchased a five-week supply of frozen pies from Continental, thereby temporarily foreclosing the. proprietary brands of Utah and other firms from the Salt Lake City Safeway market. The jury could rationally have concluded that had Utah not lowered its price, Continental, which repeated its offer once, would have continued.it, that Safeway' would jiave continued to buy from Continental and that other buyers, large as well as small, would have followed suit. It could also have reasonably-concluded that a competitor who is forced to reduce his price to a new all-time low in a market of de-t clining prices will in time feel the financial pinch and will be a less effective competitive force.

Even if the impact on Utah Pie as a competitor was negligible, there remain the consequences to others in the market who had to compete not only with Continental’s 22-ounce pie at $2.85 but with Utah’s even lower price of $2.75 per dozen for both its proprietary and controlled labels. Petitioner and respondents were not the only sellers in the Salt Lake City market, although they did account for 91.8% óf the sales in 1961. The evidence was that there were nine other sellers in 1960 who sold 23,473 dozen pies, 12.7% of the total market. In 1961 there were eight other sellers who sold less than the year before — 18,565 dozen or 8.2% of the total— although the total market^had expanded from 184,569 dozen to 226,908 dozen. We think there was sufficient evidence from which the jury could find a violation of § 2 (a) by' Continental.

III.

The Carnation Company entered the frozen dessert pie business in 1955 through the acquisition of “Mrs. Leé’s Pies” which was then engaged in manufacturing and selling frozen pies in Utah and elsewhere under the “Simple Simon” label. Carnation also quickly found the. market extremely sensitive to price. Carnation decided, however, not to enter an economy product in the market, and during the period covered by this suit it offered only its quality “Simple Simon” brand. Its primary method of meeting competition in its markets was to offer a variety of discounts and other reductions, and the technique was not unsuccessful. In 1958, for example, Carnation enjoyed 10.3% of the Salt Lake City market, and although its volume of pies sold in that market increased substantially in the next year, its percentage of the market temporarily slipped to 8.6%. JHowever, 1960 was a turnaround year for Carnation in the Salt Lake City market; it more than doubled its volume of sales over the preceding year and thereby gained 12.1% of the .market. And while the price structure in .the..market deteriorated rapidly in 1961 Carnation's;, position remained important.

We need not dwell long upon the case against Carnation, which in some respects is similar to that against Continental and in others more nearly resembles the case against Pet. After Carnation’s temporary setback in 1959 it instituted a new pricing policy to regain business in the Salt Lake City market. The Hew policy involved a slash in price of 600 per dozen pies, which brought Carnation’s price to a level admittedly well below its costs, and well below the other prices prevailing in the market. The impact of the move yras felt immediately, and the two other major sellers in the market reduced their prices. Carnation’s banner year, 1960, in the end involved eight months during which the prices in Salt Lake City were lower than prices charged in other markets. The trend continued during the eight months in 1961 that preceded the filing of the complaint! in this case. In each of those months the Salt Lake City prices charged by Carnation were well below prices charged in other markets, and in all but August 1961 the Salt Lake City delivered price was 200 to 500 lower than the prices charged in distant San Francisco. The Court of Appeals held that only the early 1960 prices could be found to have been below cost. That holding, however, simply overlooks evidence from which the jury could have concluded that throughout 1961 Carnation maintained a below-cost price structure and that Carnation’s discriminatory pricing, no less than that of Pet and Continental, had an important effect on the Salt Lake City market. We cannot say that the evidence precluded the jury from finding it reasonably possible that Carnation’s conduct would injure competition.

IV:

Section 2(a) does not forbid price competition which will probably injure or lessen competition by eliminating competitors, discouraging entry into the market or enhancing the market shares of the dominant' sellers. But Congress has established some ground tules for the game. Sellers may not sell like goods .to different purchasers at different, prices if the result may be to injure competition in either the sellers’ or-the buyers’ market unless such discriminations are justified as permitted by the Act. This case concerns the sellers’- market. In this context, the Court’of Appeals placed heavy emphasis on the .fact that Utah Pie constantly increased its sales volume and continued to make a profit. But we disagree with its apparent view that there is no. reasonably possible injury to competition as long as the volume of sales in a particular market is expanding and at least some of the competitors in the market continue to operate at a profit. Nor do we think that the Act only comes into play to regulate the conduct of price discriminators when their discriminatory prices consistently undercut other competitors. It is true that many of the primary line cases that have reached the courts have involved blatant predatory price discriminations employed with the hope of immediate destruction of a particular competitor. On the question of injury to competition such cases present courts with no difficulty, for such pricing is clearly within the heart of the proscription of the Act. Courts and commentators alike have noted that the existence of predatory intent might bear on the likelihood of injury to competition. In this case there was some evidence of predatory intent with respect to each of these respondents. There was also other evidence upon which the jury could rationally find the requisite injury to competition. The frozen pie market in Salt Lake City was highly competitive. At times Utah Pie was a leader in moving the general level of prices down, and at other times^ each of the respondents also bore responsibility for the downward pressure on the price structure.. 'We believe that the Act reaches price discrimination that erodes competition as much as it does price discrimination that is intended to have immediate destructive impact. In this case, the evidence shows a drastically declining price structure which the jury could rationally attribute to continued or sporadic price discrimination. The jury was entitled to conclude that “the effect of such discrimination,” by each of these respondents,, “may be substantially to lessen competition ... or to injure, destroy, or prevent competition with any'person who either grants or knowingly receives the benefit of such discrimination . . . .” The statutory test is one that necessarily looks forward on the basis of proven conduct in the past. Proper application of that standard here requires reversal of the judgment of the Court of Appeals.

Since the Court of Appeals held that petitioner had failed to make a prima facie ease against each of the respondents, it expressly declined to pass on other grounds for reversal presented by the respondents. 349 F. 2d 122, 126. Without intimating any views on the other grounds presented to the Court of Appeals, we reverse its judgment and remand the case to that court for further proceedings.

It is so ordered.

The Chief Justice took no part in the .decision of this case.

Mr. Justice Stewart,

with whom Mr.' Justice Harlan joins,

dissenting.

I would affirm the judgment, agreeing substantially with the reasoning of the Court of Appeals as expressed in the thorough and conscientious opinion of Judge Phillips.

There is only one issue in this case in its present posture: Whether the respondents engaged in price discrimination “where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination . ...” Phrased more simply, did the respondents’ actions have the anticompetitive effect required by the statute as an element of a cause of action?

The Court’s own description of the Salt .Lake City frozen pie market from 1958 through 1961, shows that the answer to that question must be no. In 195& Utah Pie had a quasi-monopolistic 66.5% of the market. In 1961 — after the alleged predations of the respondents— Utah Pie still had a commanding 45.3%, Pet had 29.4%, and the remainder of the market was divided' almost equally between Continental, Carnation, and other, small local bakers.. Unless we disregard the lessons so laboriously learned in scores of Sherman and Clayton Act cases, the 1961 situation has to be considered more competitive than that of 1958. Thus, if we assume that the price discrimination proven against the respondents had any effect on competition, that effect miist have been beneficent.

That the Court has fallen into the error of reading ti e Eóbinson-Patman . Act as protecting competitors, instead of competition, can be seen from its unsuccessful attempt to distinguish cases relied upon by the respondents. Those cases are said to be inapposite because they involved “no general decline in price structure,” and no “lasting impact upon prices.” But lower prices are the hallmark of intensified competition.

The Court of Appeals squarely identified the fallacy which the Court today embraces:

“. . . a contention that Utah Pie was entitled to hold the extraordinary market share percentage of 66.5, attained, in 1958, falls of its own dead weight. To approve such a contention would be to hold that Utah Pie was entitled to maintain a position which approached, if it did not in fact amount to a monopoly, and could not exist in the face of proper and healthy competition.” 349 F. 2d 122, 155.

I cannot hold that Utah Pie’s monopolistic position was protected by the federal antitrust laws from effective price competition, and I therefore respectfully dissent.

       15 U. S. C. § 15 provides that:
      “Any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney’s fee.”
      15 U. S. ,C- § 26 provides injunctive relief for private parties from violation of the antitrust laws.

       The portion of § 2 (a), relevant to the issue before the Court provides:’
      “That it shall be unlawful for ány person engaged in commerce, in the course of such commérce, either directly or indirectly, to discriminate in price between different purchasers of commodities of like grade and quality, where either or any of the purchases involved in such discrimination are in commerce . . . where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them . . . .”

       Respondent Continental by counterclaim charged petitioner with violation of § 2 (a) in respect to certain sales. On this issue the jury found for Continental, and although petitioner failed to move for a directed verdict on the counterclaim before its submission to the jury, the trial judge granted petitioner’s motion for judgment notwithstanding the verdict. The Court of Appeals reversed the judgment notwithstanding the verdict on the counterclaim, and remanded the issue for a new trial. No question concerning the counterclaim is before the Court.

       The order allowing certiorari requested counsel to brief and discuss at oral argument, in addition to the questions presented by the petition, the following questions:
      ‘T. Whether, if this Court affirms the judgment and order of the Court of Appeals directing the District Court to.enter judgment for respondents, petitioner can then make a motion for new trial under Rule 60 (c) (2) of the Federal Rules of Civil Procedure within 10 days of the District Court’s entry of judgment for respondents?"
      “2. Whether, if under the order of the Court of Appeals, petitioner cannot make a motion for new trial under Rule 50 (c). (2) within 10 days of the District Court’s entry of judgment against him, the order of the Court of Appeals directing the District Court to enter judgment for respondents is compatible with Rule 50 (b) as interpreted by this Court in Cone v. West Virginia Pulp & Paper Co., 330 U. S. 212; Globe Liquor Co. v. San Roman, 332 U. S. 571; and Weade v. Dichmann, Wright & Pugh, 337 U. S. 801?
      “3. Whether Rule 50 (d) of the Federal Rules of Civil Procedure provides the Court of Appeals with any authority to direct the entry of judgment for respondents?”
      In the light of our disposition of this case, we need not reach these questions.

       Beginning in February 1960 petitioner sold frozen pies to a Spokane, Washington, buyer under the “Sonny Boy” label.

       The prices discussed herein refer to those charged for apple pies. The apple flavor has been used as the standard throughout this case, without objection from the parties, and we adhere to the practice here.

       The Salt Lake City sales volumes and market shares of the parties to this suit as well as of other sellers during the period at issue were as follows:

        1958

        Volume Percent

        Company {in doz.) of Market

      Carnation . 5,863 10.3
      Continental . 754 1.3
      Utah Pie. 37,969.5 66.5
      Pet ... 9,336.5 16.4
      Others . 3,137 5.5
      Total .. 57,060 100.0

        1959

      Carnation . 9,625 8.6
      Continental . 3,182 2.9
      Utah Pie. 38,372 34.3
      Pet . 39,639 '35.5
      Others . 20,911 18.7
      Total . 111,729 100.0

        I960

      Carnation . 22,371.5 12.1
      Continental . 3,350 1.8
      Utah Pie... 83,894 45.5
      Pet ..’... 51,480 27.9
      Others . 23,473.5 12.7
      Total . 184,569 100.0.

        1961

        Company Volume Percent {in doz.) of Market

      Carnation' ... 20,067 8.8
      Continental .. 18.799.5 8.3
      Utah Pie .... 102,690 45.3
      , Pet . 66,786 29.4
      Others . 18.565.5 ■ 8.2
      . Total . 226,908 mO

       The Pet-Safeway contract, entered into on January 1, 1960, obligated the Safeway organization to purchase a minimum of 1,000,000 cases (six pies per case) from Pet during the year. The contract was orally renewed for one year and thereafter to the time of the trial the production of “Belair” pies by Pet for Safeway was continued without a formal contract. All of the volume of the Safeway purchases under the contract of course did not find its way to the Salt Lake City market.

       Section 2 (b) of the Robinson-Patman Act assigns the burden. “Upon proof being made, at any hearing on a complaint under this section, that there has been discrimination in price or services or facilities furnished, the burden of rebutting the prima-facie case thus made by showing justification shall be upon the person charged with a violation of this section . . . ,” 49 Stat. 1526, 15 U. S. C. § 13 (b). See F. T. C. v. Morton Salt Co., 334 U. S. 37, 44-45; United States v. Borden Co., 370 U. S. 460, 467.

       The, only evidence cited by the Court- of Appeals to justify the remaining 76% of Pet’s sales to Safeway was Safeway’s established practice of requiring its sellers to cost justify sales that otherwise would be illegally discriminatory. This practice was incorporated in the Pet-Safeway contract. We are unprepared to hold that a contractual obligation to cost justify price differentials is legally dispositive proof that such differentials are in fact so justified; Pet admitted .that its cost-justification figures were drawn from past performance, so even crediting the data accompanying the 1960 contract regarding ‘cost differences, Pet’s additional evidence would bring under the justification umbrella only the 1959 sales. Thus, at the least, the jury was free to consider the 1960 Safeway sales as inadequately cost justified. Those sales accounted for 12.3% of the entire Salt Lake City market in that year. In the context of this case, the sales to Safeway are particularly relevant since there was evidence that private label sales influenced the general market, in this case depressing overall market prices.

       The jury was in fact charged that it could find for petitioner if from respondents’ conduct “there is reasonably likely to be a substantial- injury to competition among sellers of frozen pies in the Utah area.” R,., at 1355. (Emphasis supplied.)

       The dangers of predatory price discrimination were recognized in Moore v. Mead’s Fine Bread Co., 348 U. S. 115, where such pricing was held violative of § 2 (a). Subsequently, the Court, noted that “the decisions of the federal courts in primary-line-competition cases . . . consistently emphasize the unreasonably low prices and the predatory intent of the defendants.” F. T. C. v. Anheuser-Busch, Inc., 363 U. S. 536, 548. See also Balian Ice Cream Co. v. Arden Farms Co., 231 F. 2d 356, 369; Maryland Baking Co. v. F. T. C., 243 F. 2d 716; Atlas Building Prod. Co. v. Diamond Block & Gravel Co., 269 F. 2d 950; Anheuser-Busch, Inc. v. F. T. C., 289 F. 2d 835. In the latter case the court went so far as to suggest that:
      “If .'. . the projection [to ascertain the future effect of price discrimination] is based upon predatoriness or buccaneeiing, it can reasonably be forecast that an adversé effeet bn competition, may' occur. In that event, the discriminations in their incipiency are such that thSy may have the prescribed effect to establish a violation of § 2 (a). If one engages in the latter type of pricing activity,' a reasonable probability may. be inferred that its willful misconduct may substantially lessen, injure, destroy or prevent competition.” 289 F. 2d, at 843.
      Chief Justice Hughes noted in a related antitrust context that “knowledge of actual intent is an aid in the interpretation of facts and prediction of consequences.” Appalachian Coals, Inc. v. United States, 288 U. S. 344, 372, and we do hot think it unreasonable for courts to follow that lead. Although the evidence in this regard against Pet seems obvious, a. jury would be free to ascertain a seller’s intent from. surrounding economic circumstances, which would include persistent unprofitable sales below cost and drastic price cuts ..themselves discriminatory. See Rowe, Price Discrimination Under the Robinson-Patman Act 141-150 (1962), commenting on the Court’s statement in F. T. C. v. Anheuser-Busch, Inc., supra, that “a price reduction below cost tends to establish [predatory] intent.” 363 U. S., at 552. See also Ben Hur Coal Co. v. Wells, 242 F. 2d 481, 486, and Balian Ice Cream Co. v. Arden Farms Co., supra, at 368, in which the courts recognized the inferential value of sales below cost on the issue of intent.

       Seen. 12, supra.

         It might be argued that the respondents’ conduct-displayed only fierce competitive instincts. Actual intent to injure another competitor does not; however, fall into that category, and neither, when viewed in the context of the Robinson-Patman Act, do persistent sales below cost and radical price cuts themselves discriminatory. Nor does the fact that á local competitor has a major share of the market make him fair game for discriminatory price cutting free of Robinson-Patman Act proscriptions. “The Clayton Act proscription as to discrimination in price is not nullified merely because of a showing that the existing competition in a particular market had a major share of the sales of the product involved.” Maryland Baking Co., 52 F. T. C. 1679, 1689, aff’d, 243 F. 2d 716. In that case the local competitor’s share of the market when price discrimination began was 91.3%, yet the Federal Trade Commission was not impressed by the argument that the effect of the discrimination had been to terminate a monopoly and to create a competitive market.

       Each respondent argues here that prior price discrimination cases in the courts and before the Federal Trade Commission, in which no primary line injury to competition was found, establish a standard which compels affirmance of the Court of Appeals’ holding. But the cases upon which the respondents rely are readily distinguishable. In Anheuser-Busch, Inc. v. F. T. C., 289 F. 2d 835, 839, there was no general decline in price structure attributable to the defendant’s price discriminations, nor was there any evidence that the price discriminations were “a single lethal weapon aimed at a victim for a predatory purpose.” Id., at 842. In Borden Co. v. F. T. C., 339 F. 2d 953, the court reversed the Comnpssion’s decision oh price discrimination in one market for want of sufficient interstate connection, and the Commission’s charge regarding the other market failed to show any lasting impact upon prices caused by the single, isolated incident of price discrimination proved. Absence of proof that the alleged injury was due to challenged price discriminations was determinative in International Milling Co., CCH Trade Reg. Rep. Transfer Binder, 1963-1965, ¶¶ 16,494, 16,648. In Uarco, Inc., CCH Trade Reg. Rep. Transfer Binder, 1963-1965, ¶ 16,807, there was no evidence from which predatory intent could be inferred and no evidence of a long-term market price decline. Similar failure of proof and absence of sales below cost were evident in Quaker Oats Co., CCH Trade Reg. Rep. Transfer Binder, 1963-1965, ¶ 17,134. Dean Milk Co., 3 Trade Reg. Rep. ¶ 17,357, is not to the contrary. There in the one market where the Commission found no primary line injury there was no evidence of a generally declining' price structure.

       Section 2 (a) of the Clayton Act as amended by the Robinson-Patman Act, 15 U. S. C. § 13 (a).

       See ante, p. 691, n. 7.

       See ante, p. 703, n. 15.


author: Mr. Justice Fortas

text:
    CLEWIS v. TEXAS.
    No. 648.
    Argued March 15, 1967.
    Decided April 24, 1967.

      Reagan H. Legg, by appointment of the Court, 385 U. S. 944, argued the cause and filed briefs for petitioner.

      Gilbert J. Pena, Assistant Attorney General of Texas, argued the cause for respondent. With him on the brief were Crawford C. Martin, Attorney General, George M. Cowden, First Assistant Attorney General, R. L. Latti-more, Assistant Attorney General, and A. J. Carubbi, Jr.

   Mr. Justice Fortas

delivered the opinion of the Court.

Petitioner, Marvin Peterson Clewis, stands convicted of the murder, by strangulation, of his wife, Dorothy Mae Clewis. The jury which found him guilty imposed a sentence of, 25 years’ imprisonment. During the course of his trial, petitioner moved to exclude from evidence three statements he had made while in police custody. Petitioner claimed that these statements had not been voluntarily made, and that their use against him at his trial would deny him due process of law, as guaranteed by the Fourteenth Amendment to the Constitution. Evidence was taken by the court outside of the jury’s presence, and the motion was overruled. Petitioners third, and last, written confession was then introduced in evidence over objection. The question of its volun-tariness was presented to the jury, which, by its general verdict, resolved the_ question against petitioner. Petitioner’s constitutional objection to the use of his statement was renewed in his motions for instructed verdict and for a new trial, both of which the trial judge overruled. On appeal, the Court of Criminal Appeals of Texas affirmed the judgment of conviction. That court reviewed the record and concluded that it could not hold “that there are any undisputed facts which rendered the confession inadmissible as a matter of law.” Wé disagree, and we reverse.

The question for determination is whether, considering the “totality of the circumstances,” Marvin Clewis’ statements were not voluntary and the third statement should have been excluded. We approach this question from an independent examination of the whole record, our established practice in these cases. Our recent observation in Davis v. North Carolina, 384 U. S. 737, 741 (1966), applies equally here: “As is almost invariably so in cases involving confessions obtained through unobserved police interrogation, there is a conflict in the testimony as to the events surrounding the interrogations.” For the purpose of deciding this case, we need not go beyond the State’s version of the facts. Accordingly, we do not consider petitioner’s claim that he was subjected to physical assaults.

The trial of this case was prior to the date of decision of Miranda v. Arizona, 384 U. S. 436 (1966), the requirements of which, therefore, are not directly applicable, Johnson v. New Jersey, 384 U. S. 719 (1966), although relevant- on the issue of voluntariness, Davis v. North Carolina, 384 U. S. 737 (1966).

Petitioner was taken into custody at about 6 a. m. on Sunday, July 8, 1962, and first gave a statement to the police late in the afternoon of Monday, July 9. Thereafter, he was taken before a magistrate. On the view most favorable to the State, petitioner had been held some 38 hours before being taken before a magistrate to be charged, had had little sleep and very little food, and appeared to the police to be sick. He had been visited briefly once or twice, but had had no contact with a lawyer. He had consistently denied all knowledge of his wife’s death until the point at which he agreed to give a statement, and then had confessed to killing her in a way (by shooting) that — it later developed — was inconsistent with the facts.

Petitioner next gave a statement on Thursday, July Í2. The events leading up to the second “confession” may be summarized: having been formally charged, but unrepresented and unadvised by counsel, petitioner was interrogated, fairly frequently and by several different officers from Monday evening to Thursday afternoon. During this period he was driven on a round trip of about 600 miles, was administered several polygraph tests, was detained in at least three different police buildings, and apparently had very little to eat and little contact except with policemen; Despite all this, and in the face of his earlier “confession,” he steadfastly denied any guilt— or even knowledge — with respect to his., wife’s death until he finally produced the second “confession.”

On Friday, July 13, Clewis was delivered to the custody of the Midland County Sheriff. He remained in the county jail from then until Tuesday, July 17. During this time he was apparently not interrogated, abused, or denied adequate food and sleep. He did not, however, consult with a lawyer.

At about 9:30 a. m., Tuesday, July 17, petitioner was again interrogated, this time by two deputy sheriffs. He again began by denying any guilt in connection with his wife’s death. No lawyer was present, nor had petitioner been advised of his right to have one appointed. The Midland County District Attorney arrived, and shortly thereafter petitioner confessed for the third time. There is no testimony that any warning of the right to remain silent was given prior to this oral confession. About 10:45 a. m. preparation of a written statement was begun, following á formal warning of the right not to make it. Shortly thereafter, Clewis signed the statement which was introduced against him at trial.

On this record, we cannot hold that petitioner’s third statement whs voluntary. It plainly cannot, on these facts, be separated from the circumstances surrounding the two'earlier “confessions.” There is here no break in the stream of events from the time Sunday morning when petitioner was taken to the police station to the time Tuesday morning some nine days later that he signed the statement in issue, sufficient to insulate the statement from the effect of all that went before. Compare United States v. Bayer, 331 U. S. 532, 540 (1947) with Reck v. Pate, 367 U. S. 433, 444 (1961).

Among the factors which require our conclusion that the “confession” was not voluntary are the following:

(1) During this long period of custody, petitioner was never fully advised that he could consult counsel and have counsel appointed if necessary, that he was entitled to remain silent, and that anything he said could be used as evidence against him. Cf. Davis v. North Carolina, 384 U. S. 737 (1966); Miranda v. Arizona, 384 U. S. 436 (1966). Even after he was arraigned, he was not advised of his right to appointed counsel. Post-arraignment interrogation, over a period of more than'a week,' occurred without the presence of counsel for the accused, and without any waiver thereof.

(2) The first statement was secured following an initial taking-into-custody which was concededly not supported by probable cause', followed by 38 hours of intermittent interrogation — despite the Texas rule that an accused be taken before a magistrate “immediately.” Texas Code Crim. Proc. Art. 217 (1925) ; now, substantially revised in other respects, Texas Code Crim. Proc. Arts. 14.06, 15.17 (1965). This was followed by prolonged, if intermittent, interrogation by numerous officers, in several buildings, punctuated by a trip to . the gravesite and a long trip to another town, and accompanied by several polygraph tests. The police testimony makes it clear that the interrogation was not intended merely to secure information, but was specifically designed to elicit a signed statement, of “the truth” — and the police view of “the truth” was made clear to petitioner. The petitioner repudiated each of the first two confessions shortly after it was made, and denied the truth of the third one at his trial.

(3) The record.inspires substantial concern as-to the. extent to which petitioner’s faculties were impaired by inadequate sleep and food, sickness, and long subjection-to police custody with little or no contact with anyone other than police. This factor takes on additional weight in that petitioner, a Negro, had only a fifth-grade education. He had apparently never been in trouble with the law before.

For the foregoing reasons, the judgment below must be, and is, Reversed.

Mr. Justice Black, Mr. Justice Clark, and Mr. Justice Harlan concur in the result.

       Petitioner also claimed that his right to counsel had been violated in the securing of these confessions. Cf. Massiah v. United States, 377 U. S. 201 (1964).

       The trial judge did not make written findings on the voluntariness issue at the time of trial. Some eight months later he certified that he had concluded that the (third) statement was in fact voluntary. This “belated entry and filing of the trial court’s findings” was accepted as a supplement to the transcript of record by the Court of Criminal Appeals.

         Fikes v. Alabama, 352 U. S. 191, 197 (1957). See also, e. g., Davis v. North Carolina, 384 U. S. 737 (1966); Haynes v. Washington, 373 U. S. 503 (1963).

       See Davis v. North Carolina, 384 U. S. 737, 741-742 (1966).

       Most of the physical abuse petitioner later related allegedly, occurred during this period.

       The State contends that Clewis did consult with an attorney on Thursday morning. He insists the conference took place on Friday morning. In any event, the State does not dispute his testimony that the only subject discussed with the lawyer was the matter of a fee, and that the lawyer declined to represent him.

       The arresting officer testified that he merely asked petitioner to accompany him to the police station. He was of the opinion that he had no probable cause to arrest petitioner. Plainly, however, petitioner must be considered to have been taken into custody either at the. time the officer came to get him, or shortly thereafter when the police, by their conduct, effectively asserted a right to detain him indefinitely at the jail. The Court of Criminal Appeals was apparently of the view that the rule of Wong Sun v. United States, 371 U. S. 471 (1963), is inapplicable to state trials — an issue iipon which we express no ¿pinion herein, since we find petitioner’s statement inadmissible on other grounds.

       At trial, petitioner moved for production by the State of all ; three confessions, as necessary to support his claim that the manner of their eliciting rendered them inadmissible. That these prior confessions might have been directly relevant to petitioner’s central defense can scarcely be doubted; for example, it came out during the hearing on the motion to suppress that petitioner had initially confessed to killing his wife- by shooting her — a claim contrary to his later confessions and to known facts later discovered — and this inconsistency lends some weight to petitioner’s defense of non voluntariness. Perhaps there were other inconsistencies which petitioner could have . shown, had he had access to the prior confessions. Under amended Rule 16 of the Federal Rules of Criminal Procedure, a federal defendant could, prior to trial, discover his own statements; it seems that under the-new 1965 Texas Code of Criminal Procedure, Art. 39.14, pretrial discovery of petitioner’s confessions would have been proper. Cf. also Dennis v. United States, 384 U. S. 855, 871, and n. 17 (1966). This Court has suggested that in some circumstances it may be a denial of due process for a defendant to be refused any discovery. of his statements to the police. Cicenia v. Lagay, 357 U. S. 504, 510-511 (1958); Island v. Oregon, 343 U. S. 790, 801-802 (1952). In light of our disposition of this case, however, we need not reach this question.


text:
    PROHIBITION PARTY OF MICHIGAN et al. v. HARE, SECRETARY OF STATE OF MICHIGAN, et al.
    No. 1098.
    Decided April 24, 1967.

      James L. Elsman, Jr., for appellants.

      Frank J. Kelley, Attorney General of Michigan, Robert A. Derengoski, Solicitor General, and Russell A. Searl, Assistant Attorney General, for appellees.
   Per Curiam.

The motion to dismiss is granted and the appeal is dismissed for want of jurisdiction. Treating the papers whereon the appeal was taken as a petition for a writ of certiorari, certiorari is denied.


text:
    ARNOLD v. VIRGINIA.
    No. 1118.
    Decided April 24, 1967.

      John H. Kennett, Jr., for appellant.
   Per Curiam.

The appeal is dismissed for want of jurisdiction. Treating the papers whereon the appeal was taken as a petition for a writ of certiorari, certiorari is denied.