But the exception to the rule forbidding interlocking directorates as to corporations within the operation of the Clayton Law, other than banks, is very indefinite and uncertain. Two such corporations, regardless of how great may be the amount of the capital, surplus and undivided profits of either or both of them, may have interlocking directorates unless such corporations are, or previously shall have been, by virtue of their business and location of operation, competitors, so that the elimination of competition by agreement between them would constitute a violation of any of the antitrust laws. This obviously makes the lawfulness of interlocking directorates created by two such corporations, depend finally upon an interpretation of the antitrust laws. If the two corporations, being otherwise within the terms of the Clayton Law, are competitors so that elimination of com- petition between them by agreement would violate any provision of the antitrust laws, they may not lawfully have interlocking directorates. Otherwise they may. It would be difficult to conceive a more uncertain and shifting standard of corporate conduct than this one, by which the question of what elimination of competition between two corporations by agreement would constitute a violation of the antitrust laws, is made the test of the lawfulness of an interlocking directorate between such corporations.44

§ 13. Clayton Law creates merely a new remedy: It appears doubtful, to say the least, whether sections two, three, seven, eight, and eleven of the Clayton Law have materially changed the previously existing substantive law of interstate trade. It would seem that, prior to the enactment of the Clayton Law, the devices for restraining trade and creating monopoly denounced by that stat

44Cf., note 37, supra.

ute, might have been reached under the Sherman Law.45 Thus the so-called "Gary Dinners" held to regulate prices in the iron and steel industry, appear to have represented a lesser degree of co-operation to eliminate competition in interstate trade than that which would result from such interlocking directorates as are forbidden to commercial corporations by the Clayton Law. The "Gary Dinners" offended against the Sherman Law.46 Again, exclusive purchase and sale arrangements such as are declared unlawful by section three of the Clayton Law, were prominent features in several cases wherein the government obtained decrees under the

* * * *

45 The all-embracing scope of the Sherman Law has been emphasized repeatedly. In United States v. Keystone Watch Case Co. (1915) 218 Fed. 502, 515-516, McPherson J., referring to the Sherman Law, said: "The act of 1890 is directed against restraint of interstate or foreign trade * Trade may be restrained * in many ways and by many devices, but these are all covered by the first and second sections of the act. In these sections two classes of prohibited acts are described: (1) The concerted action of two or more persons, which may take the form of a contract, a combination in whatever form, or a conspiracy; and (2) monopoly, or the attempt to monopolize, which may be the act of one person alone, or of more than one. These two classes are intended to be all-embracing, and thus far in the history of the statute no variety of device has escaped their sweep" (our italics).

In Standard Sanitary Mfg. Co. v. United States (1912) 226 U. S. 20, 49, Mr. Justice McKenna said that the "comprehensive and thorough character" of the Sherman Law, and "its sufficiency to prevent evasions of its policy, 'by resort to any disguise or subterfuge of form' or the escape of its provis ions 'by any indirection'," had been demonstrated. In Standard Oil Co. v. United States (1911) 221 U. S. 1, 62, Mr. Chief Justice White, referring to the Sherman Law, said that "the statute by the comprehensiveness of the enu

merations embodied in both the first and second sections makes it certain that its purpose was to prevent undue restraints of every kind or nature" (our italics). See also United States v. American Tobacco Co. (1911) 221 U. S. 106, 178-181. Cf., note 93, infra.

46 United States v. U. S. Steel Corporation (1915) 223 Fed. 55, 154-161, 173-178.

Sherman Law.47 So, also, as to intercorporate shareholding against which section seven of the Clayton Law is directed.48 It may perhaps be that in so far as section three of the Clayton Law, in forbidding exclusive purchase and sale arrangements, thereby prohibits the selling or leasing of a patented article, as for instance a machine, upon a restrictive condition binding the purchaser or lessee not to use in connection with such article any supplies obtained from a competitor, or from any source except the patentee, pre-existing law has to that extent been changed. That such is the case cannot, however, be asserted very confidently, because the extent of the right of a patentee to make such so-called "tying" contracts was not very clearly or certainly defined before the Clayton Law was enacted,49 and considering the limitations upon the prohibition of "tying" contracts, as found in the Clayton Law,50 the right of a patentee to make such contracts is hardly, if at all, less vague and uncertain than it was before that statute was enacted. Thus viewed, the principal effect upon pre-existing law of sections two, three, seven, eight, and eleven of the Clayton Law appears to have been merely the

47 United States v. Great Lakes Towing Co. (1913) 208 Fed. 733, 738-739, 743, 745; United States v. Keystone Watch Case Co. (1915) 218 Fed. 502, 511; United States V. Motion Picture Patents Co. (1915) 225 Fed. 800, 809; United States V. Eastman Kodak Co. (1915) 226 Fed. 62, 73.

48 United States v. Union Pacific R. R. Co. (1912) 226 U. S. 61, 86, 95-96; United States v. American Tobacco Co. (1911) 221 U. S. 106, 143-148, 176.

49 Henry v. Dick Co. (1912) 224 U. S. 1, in which the court was of

divided opinion; United States v. Winslow (1913) 227 U. S. 202, 204, 205, 216-217; Elliott Machine Co. v. Center (1915) 227 Fed. 124; United States v. United Shoe Ma chinery Co. (1915) 227 Fed. 507, 510-511.

50 Secs. 4, 10, supra. As to the retroactive operation of the pro visions of the Clayton Law relat ing to "tying contracts", see El liott Machine Co. v. Center (1915) 227 Fed. 124; United States v. United Shoe Machinery Co. (1915) 227 Fed. 507, 510-511.

creation of a new remedy, in the form of statutory proceedings51 by the Trade Commission, for wrongs against which, prior to the enactment of the Clayton Law and ever since the enactment of the Sherman Law, all the power of the government could be brought to bear. § 14. Violations of the Trade Law: The rule of conduct prescribed by the Trade Law is even more uncertain than the rules established by the Clayton Law in respect of price discriminations, exclusive purchase and sale arrangements, intercorporate shareholding, and interlocking directorates. The Trade Law declares merely that "unfair methods of competition in commerce" are unlawful.52 Unlike the Clayton Law, the Trade Law does not make explicit even the general nature of the acts and conduct which it denounces as unlawful. It does not in any way define or describe what shall constitute "unfair methods of competition in commerce," which it authorizes the Trade Commission, in the exercise of its regulative power, to prevent. What trade practices are inhibited by the Trade Law depends, therefore, upon what may be the sound interpretation of the statute.

§ 15. Injury to public essential to violation of Trade Law: There would seem to be adequate grounds to support the conclusion that in declaring "unfair methods of competition in commerce" to be unlawful, and authorizing the Trade Commission to institute proceedings to prevent such methods, Congress intended to denounce a public, as distinguished from a private, injury in respect of trade.

Congress would hardly undertake, if indeed it has the power, to create and maintain at the cost of the public

51Clayton Law, Sec. 11; and Sec. 29, infra.

52Trade Law, Sec. 5.

an administrative body to prevent, at public expense, any competitive trade practice essentially injurious merely to the individuals directly affected thereby. Moreover, by the terms of the Trade Law, the Trade Commission is required to institute proceedings to prevent the competitive methods generically denounced by the statute, only "if it shall appear to the Commission that a proceeding by it in respect thereof would be to the interest of the public." The presence and force of that phrase in the Trade Law should not, it would seem, be overlooked.

What is to the "interest of the public" in respect of preventing or encouraging any method of competition would seem quite clearly to be essentially a legislative question, and it is not open to doubt that the Constitution forbids that the Trade Commission should be made a repository of legislative power. It therefore seems probable that in order to avoid a construction of the Trade Law which would make that statute of at least doubtful constitutionality, the courts will hold that, by authorizing the Trade Commission to exert its regulative power if it should appear to the Commission that the institution of proceedings by it looking to the prevention, by the decree of a competent court, of unfair methods of competition would be to the "interest of the public," Congress did not intend to delegate to the Commission the duty of determining the requirements of a sound public policy in respect of methods of competition, and did not intend to confer upon the Commission uncontrolled power to suppress this, or encourage that, method of competition, according as the Commission, in the exercise of a wise discretion, might consider the one method of competition harmful, and the other beneficial, to the public. If that conclusion be sound, it would seem to follow therefrom that, when enacting the Trade Law, Congress must have entertained the view that there was