The Need for a Commerce Court

• Date: 01 January 1930
• Published date: 01 January 1930
• DOI: 10.1177/000271623014700118
• Subject Matter: Articles

The Need for a Commerce Court
1
By WILLIAM J. DONOVAN
Former Assistant to the United States Attorney General; Member, New York Bar,
New York City
T PROPOSE to discuss the thesis,
use of the machinery of the criminal
that there should be established a
law. We believed that all we needed
Federal agency with power to inquire
to do was to pursue the conventional
into, consider and determine in ad-
method of a public prosecutor, who,
vance the legality of industrial con-
acting upon complaint, would submit
solidations or trade agreements affect-
the case to the determination of a court.
ing competition.
But the Sherman Act itself, in fact,
For the purpose of this discussion it
was not so much a criminal statute as
is assumed that the Sherman Anti-
the definition of a common law policy.
Trust Act is sound in principle, that it
The thirty-five years of its existence
represents a political and social theory
ought to show that the effective ap-
as well as an economic theory and that
proach for carrying it into effect is
it is a philosophy of human relationship
through some preventive method that
and has for its object to conserve the
would arrest the evil before it could
public interest by protecting it from
work harm.
economic exploitation.
Criticism of the Sherman Act
PROPOSED ADMINISTRATIVE
comes
today from
REMEDIES
two sources: first, those
who insist that it should be repealed
There has been recognition of this
because it constitutes an undue limita-
fact, and attempts have been made
tion upon industry and a shackle upon
from time to time to provide a remedy.
the development of business, that it
On
March 25,1908, President Roose-
gives no definite rule by which business
velt urged certain administrative reme-
men may be guided and that this re-
dies in the enforcement of the anti-trust
sults in confusion and uncertainty; sec-
laws. He stated in his message that
ond, those who assert that the anti-
his suggestion was only tentative and
trust laws are not properly enforced,
his views would apply equally to .any
and who, as proof of their assertion,
other measure which would achieve the
cite the continued growth of industrial
desired end. He said:
combinations.
The substantive part of the Anti-Trust
We are concerned here with the sec-
Law should remain as at present; that is,
ond type of criticism.
every contract in restraint of trade or com-
The enforcement provisions of the
merce among the several states or with
Sherman Act were based upon the as-
foreign nations should continue to be de-
sumption that monopolies could be
clared illegal; provided, however, that some
prevented and illegal trade agreements
proper governmental authority (such as
the Commissioner of
thwarted
Corporations
by
acting
a system of repressive
under the Secretary of Commerce and La-
legislation. It was believed that the
bor) be allowed to pass on any such con-
effective method was to be found in the
tracts. Probably the best method of pro-
1
An address delivered at the
viding for this would be to enact that any
meeting of the
contract subject to the
Pennsylvania Bar Association at Bedford
prohibition con-
tained in the Anti-Trust Law, into which
Springs, Pennyslvania, June 28, 1929.
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139
it was desired to enter, might be filed with
conduct, would have a great security
the Bureau of Corporations or other appro-
against prosecution by the publicity
priate executive body. This would provide
of its procedure and the opportunity
publicity. Within, say, sixty days of the
for frequent consultation with the
filing-which period could be extended by
bureau or commission in charge of the
order of the Department whenever for any
incorporation.
reason it did not give the Department suffi-
On
cient time for
July ~6, 1911, in the Taft Ad-
a thorough examination-
the executive department having
ministration,
power
a resolution was passed
might forbid the contract, which would
by the Senate authorizing the Senate
then become subject to the provisions of
Committee on Interstate Commerce to
the Anti-Trust Law, if at all in restraint of
report to the Senate what changes were
trade. If no such prohibition was issued,
necessary or desirable in the laws relat-
the contract would then only be liable to
ing to the control of those engaged in
attack on the ground that it constituted
interstate commerce. Under this reso-
an unreasonable restraint of trade.
When-
lution exhaustive hearings were held
ever the period of filing had passed without
covering every phase of the subject.
any such prohibition, the contracts or com-
binations could be
This
disapproved
committee then submitted a re-
or forbidden
only after notice and hearing with a reason-
port which discussed the desirability of
able provision for summary review on ap-
legislation supplementary to the Sher-
peal by the courts.
man Act, and in dealing with the sub-
ject of a proposed trade commission
In his message of January 7, 1910,
declared
President Taft recommended the enact-
ment by Congress of
that
a general law for
through the intervention of such a
the formation of corporations engaged
body of men the legislative policy with re-
in interstate
spect to combinations and monopolies could
commerce, protecting
be made vastly more effectual than
them from undue influence
through
by the
the courts alone, which in most cases will
states and regulating their activities so
take no cognizance of violations of the law
as to prevent abuses. He said that he
for months or years after they occur, and
could find no other method which
the difficulty of awarding reparation for
would offer Federal protection on the
the wrong is almost insurmountable.
one hand, and close Federal supervision
on the other, of these great organiza-
However, no bill was reported and
tions that are &dquo;in fact Federal because
no additional action was taken on the
they are as wide as the country and en-
part of the Senate under President
tirely unlimited by state lines.&dquo; On
Taft’s Administration.
December 5, 1911, in pressing again for
PROPOSED...