DOCUMENT RESUME

ED 092 003 HE 005 562

AUTHOR Hartman, GregTITLE Antitrust and the Control of Higher Education.INSTITUTION Western Interstate Commission for Higher Education,

Boulder, Colo. Resources Development InternshipProgram.

PUB DATE Sep 72NOTE 33p.

EDRS PRICE MF-$0.75 HC-$1.85 PLUS POSTAGEDESCRIPTORS *Court Cases; *Federal Laws; *Federal Legislation;

*Higher Education; *State AgenciesIDENTIFIERS Clayton Act; Federal Trade Commission Act; *Oregon;

Sherman Act

ABSTRACTThis report presents the basic components of a "prima

facie" antitrust case against the Oregon State System of HigherEducation. It deals with the constitutional issues raised as well asshowing that higher education is interstate commerce within themeaning of the antitrust laws. The report analyzes the stateexemption to antitrust laws and concludes that recent decisions havelimited this exemption to such an extent that the State System wouldbe held to be within the scope of the antitrust laws. Under theSherman Act the most difficult parts of the prima facie case areproof of conspiracy and market definition. In a Clayton Actprosecution the most difficult task is to show that higher educationis a commodity and that the State Bard of Higher Education is aperson, although showing the substantive acts of tying and pricediscrimination is easy. The Federal Trade Commission Act is the mostpromising for attacking the present State System because the act issuppoged to deal with cases where substantive actions are clear buttechnicalities prevent prosecution under other acts. Researchindicates that although an antitrust suit against the State Systemwould certainly.s.be called a long shot, it is indeed feasible and hasa firm foundation in case law. (Author/MJM)

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ANTITRUST AND THE CONTROL OF HIGHER EDUCATION

by

Greg HartmanConsumer Rights Research Center

University of OregonSeptember, 1972

I.

V.

Table of Contents

Abstract

Preface

introduction

Threshold IssuesA. ConstitutionalB. State ExemptionC. CommerceD. Interstate

Sherman ActA. Section 1

1) Contract, Combinationor Conspiracy

2) Interstate Trade orCommerce

3) Market4) Undue Restraint of

CompetitionR, Section II

1) Monopolization2) Attempt or Conspiracy

to Monopolize

2

2

S

6

7

7

9

VI, The Clayton Act 13

A, Price Discrimination 13

1) Person2) Commodity3) Commerce4) Lessen Competition

B, Tying 15

VII, Federal Trade Commission Act 16

VIII. Conclusion 16

IX, Notes 18

I, Abitract

This report presents the basic components of a nrima faciaantitrust case against the Oregon State System of Higher Education.It deals with the constitutional issues raised as well as showingthat higher education is interstate commerce within the meaning ofthe antitrust laws. The report analyzes the state exemption toantitrust laws and concludes that recent decisions have limitedthis exemption to such an extent that the State System would beheld to be within the scope of the antitrust laws. Under theSherman Act the most difficult parts of the prima facie case areproof of conspiracy and market definition. It is shown that theState System is engaging in several actions which are substantiveviolations of the Sherman Act, including price fixing, tying, marketsharing, and selling below cost. In a Clayton Act prosecutionthe most difficult task is to show that higher education is acommodity and that the State Board of Higher Education is aperson, although showing the substantive acts of tying andprice discrimination is easy. The Federal Trade Commission Actis the most promising for attacking the present State Systembecause the act is supposed to deal with cases where substantiveactions are clear but technicalities prevent prosecution underother acts. Unlike the other antitrust acts, private suits cannot be brought under the Federal Trade Commission Act but must bebrought before the Federal Trade Commission. The Commissiononly has to accept a suit if it finds that it is in the publicinterest. Research indicates that although an antitrust suitagainst the State System would certainly be called a long shot,it is indeed feasible and has a firm foundation in case law. Tt ishoped that this paper will succeed in transfering the discussionof antitrust and higher education from legal technicalities to

the divergent policies of antitrust and higher education.

II, Preface

The author has just begun his second year of studie3 at theUniversity of Oregon Law School, where he enrolled after receivinga B. A. in path from the Vnivernity of Chicspo, This paper is theresult of twelve weeks of research undertaken white employed as

a W/CNE (Western Interstate Commission of Higher Education) internduring the summer of 1972, The internship was sponsored by theUniversity of Oregon's ConsuMer rights Research Center (crpo and gas'funded by a grant received from the Center to study the marketingand funding of iligher Education.

Previous studies done by CPRC have revealed sore of theanti-competitive effectn of the present system of funding hindereducation in Oregon and the question of the relevance of theAntitrust laws has arisen. The purpose of this prolect is to Assessthe feasibility of an antitrust suit against the nrepon StateSystem of nigher Education and to prepare a report which dtscunsestne,rclevant legal complexities. This report is intended tosupplement the research being done by CRRC consequently no economicanalysis is presented.

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III, Introduction

During the past several years oducarion in America 'lasreceived a large measure of publicity, often due to the turmoilevident on college campuses throughout the country. As this turmoilhas subsided attention has been given to other aspects of education;one of the areas given increasing scrutiny is the fundinc ofeducation. Many have become concerned about the upward spiralingof property taxes to support elementary And secondary education aswell as the state and federal taxes used to support highereducation. This concern has led to an analysis of the situationwhich suggests that the higher education industry can be studiedusing models similar to those used to study other industries, Thisline of argument that the higher education industry respondsto the same economic rules as other industries leads one toquestion why the higher education industry should not also playby the same legal rules. In particular, why shouldn't thehigher education industry be subject to federal antitrust laws?This paper will analyze the higher education industry in Oregon interms of the federal antitrust laws,

The first four sections of the paper deal with thresholdquestions which are c.ommon to all three of the antitrust acts.In these sections the constitutional issues are examined, educationas interstate commerce is analyzed, and the question of the acopeof the state exemption to antitrust laws is studied. The nextmajor section deals with both parts of the Sherman Act, analyzingsuch State System actions as price fixing, tying, market sharing,and selling below cost. The next section considers tying and pricediscrimination and the basic elements of an action under the ClaytonAct. The section on the Federal Trade Commission Act examines boththe broad acope and limitations under the final antitrust act.

This paper can be likened to a preliminary brief on the subjectof antitrust and higher education, An attempt has been made topresent a prima facie case against the Oregon State System of HigherEducation (hereinafter the State System) and to highlight the legalcomplexities of an antitrust case against the State System. Thispaper should not be viewed as the first step in the preperation of acourt case against the State System but rather as an argument tobe used in conjunction with economic analysis of the State System toprompt legislative action, Antitrust law is based on a firmfoundation of belief in the advantages of a competitive marketsituation and if it can be shown that the State System is inviolation of the substantive antitrust law, this system willbe operating in conflict with those policies. If this conflictcannot be resolved, the antitrust laws will prevail and the StateSystem should be changed.' In addition, it should be noted that theOregon legislature has passed antitrust laws declarinv such hings nsprice discrimination and selling below cost to be illegal, apparentlywithout realizing the conflict between these laws end the State System,1

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These conflicts between federal antitrust law and the funding ofthe State System must either be justified or resolved throughlegislative change, It is clear that the state could not set up amonopoly directly by driving out All of the private colleges' an attemptto do that in elementary and secondary education in Oregon wasdeclared to be in violation of the first amendment.4 If the statecan not create a monopoly directly then it should be restrainedfrom doing so indirectly.

IV. Threshold Issues

Constitutional

One issue which will immediately be raised when the possiblilityof an antitrust suit against the State System is suggested is theState's Constitutional right to set up a higher education systemwithout interference from the federal goveenment; however, thisshould prove to be no great obstacle. The Supreme Court has said,"The power of Congress in the commerce field is broad and sweepingand where it keeps within its sphere and violates no expressconstitutional limitation, the Supreme Court will not interfere. "'Although there is some governmental immunity to the power of thefederal government to tax6it has long been recognized thatpublic schools are subject to taxation.? Congress has always beenable to exercise its power under the con,Aerce clause to suspendstate lays which interfere with its purpose.8 The sovereign powerof the states is necessarily diminished by the extent of the grantsof power to the Federal government in the Constitution.9 TheSupreme Court has recognized that public school systems come withinCongress' power to regulate commerce.10

State Exemption

The most important defense to any antitrust action against theState System will be that the state does not come within the scoreof the antitrust laws. In the landmark case of Parker v. Brownllthe Supreme Court held that activities of state governments were notwithin the prohibitions of the Sherman Act. The scheme under reviewin the Parker case had been set up by the California legislatureto control the production and distribution of raisins, The purposeof this scheme was to "conserve the agricultural wealth of the State"and to "prevent economic waste in the marketing of agricultural crops"12of the state. The Court assumed for the purposes of the opinion thatthe scheme would have 1,een ille7,a1 if undert0Pn nrivatelv and nobased its opinion squarely on the State's exemption from tho ShermanAct. The Court stated that there is "not!lin,-, in Cip 11nNin!,.)f the SLuran Act or in its history which suggests that its pnroosewas to restrain a state or its officers or agents from activitiesdirected by its leo,islature."13The Court immediately placed limits on

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this state exemption by notinn tl,ra "a state does not liveto those who violate the Sherman authorizing them to violate it,or by declaring that thAu ;1cti.on laY(ul."1The Court alsopointed out that tho question of a Stat:2 joining in a private agreementor combinatiu by others for restraint of trade was not at issuein the case."

The result of the Parker case has been questioned by frequentlitigation which has served to further restrict the state exemption.In a number of cases involving tobacco hoards of trade set upby statute but staffed by local growers the emphasis was on thereasonableness of the conduct rather than the state exemptionand some of these b94rds'of trade were found to be violatingthe antitrust laws. In the insurance field a North Carolinascheme for regulating insurance was found to be indistinpuishhblefrom the Parker case and so exempt from antitrust regulationPIn three cases the courts have examined the question of public officialsnarticipation in sonspiracies to restrain trade and only onefound liability.1°The other two cases, however, are not strongprecedents since one involved a situation in which the FederalAviation Administration had partial jurisdiction, and in theother case the public official's only action was to switch analready existin monopoly from the hands of the plaintiff tothe defendant.2ufhe courts have now realized that the emphasisof the Parker Court on the extent of the state involvement"precludes the facile conclusion liat action by any public officialautomatically confers exemption.'

Several tests have evolved for determining the extent of thestate exemption to antitrust law. The simplest of theseexamines the amount of state participation in the situation underquestion and if there is a large amount of state control there isimmunity.22The second test goes much further and examines thepolicy behind the state action under question. The court in Whittenv. Paddock stated that "valid government action confers antitrustimmunity only when government determines that competition is notthe summun bonum in a particular field and deliberately attemptsto provide an alternate form of public regulation," 23In theWhitten case the court divided antitrust cases in which the statewas involved into three categories. In the first category,which includes the Parker case, the state had deliberately occupiedthe field to enforce an anticompetitive policy.24The court pointsout that a state policy of encouraging price stability is not enoughto confer an exemption from antitrust laws; the state must actuallydelegate the power to set prices and have some method forreviewing these prices,25The middle category is occupied by cases inwhich the state has chosen to regulate an industry but where thestate has remained neutral with respect to restraints of trade.In these cases the courts have denied immunity. 261n the thirdcategory in which the '.Whitten case falls the state has espousedan openly competitive policy and no immunity is found. The final

3

test for deciding the question of ,Ate fr,munity examines not onlythe state policy behind the action; in question but the federalpolicy behind the antitrust laws and aev other relevant statuteas well. If both federal and state statutes are found to cover thesame field and the laws have the same enrpose, they are reconciledand allowed to cRexist; if the lays reveal different purposes, thestate law falls.'7An attempt is made to render both stateregulatory and federal antitrust goals complementary rather thanmutually exclusive.28Reasoqing along theSe lines the court inHecht v. Pro-Football, Inc;9pointed out that the immunity toantitrust laws granted in the Parker case was really a result ofthe similar goals of the state action in question and the federalAgricultural Adjustment Act. The exemption was created not by stateaction but by Congress itself when it passed the AgriculturalAdjustment Act.3°

The Supreme Court has not yet resolved the differences betweenthese tests of state immunity to the antitrust laws; consequentlyany of them might be the proper one to resolve the questionof immunity for the State System. To attempt to resolve these threetests in this paper would require a great deal of time and ink andthe result of this process certainly could not be regarded as theultimate test, An easier approach is simply to examine the StateSystem in light of the three tests, i'sing the first purelyquantitative test it Is clear that the State System would be grantedimmunity since the state not only regulates the State Systembut it also completely 'controls and provides most of the financinz forthe State System. Using the second test the State System clearlywould not he granted immunity since the state has never "determinedthat competition is not the summun bonus" in the field of education,Using the third test and keeping in mind that the purpose of anact is determined not only hxile,gislative declarations but by theeffects of a statute as well it is clear that if the State Systemhas anti-competitive effects then its purpose is in conflict withthe purpose of the antitrust laws and no immunity will be granted.r)nly the first of the three tests Mould Brant immunity to theState System and the two cases on which this test is based areshaky precedents, In the Travelers case the court rested itsdecision partly on the fact that the defendant "had not beenextended valid governmental authority to engage in monopolisticpractices" which seems co place this case in the middle categerof the second test. Tn the Norman's case the court pointed out thatthe 'icGuire Act was not applicable to the Virpin Tslands sinceit did not have full legislative power and there is a ernat dealof policy analysis undertaken resemhling that necessary for thethird test. The first test, the purely quantitative one, in theonly test which would grant the State System immunity and it hns thatbeen shown that that test is not based on strong precedents.

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ocnrerce

Another question which will imnediately be raised in anantitrust suit against the State System is that education is notcommerce within the meaning of the antitrust laws, There is noexpress statutory exemption for professional activities but formany years these activities enjoyed immunity from antitrust sincethey were n6t considered to come within the meaning of commerce,32But the commrrce category has been expandqd so that it nowincludes medicine, insurance, and drama.3JIn the only antitrustcase which considered the question of education as commerce theDistrict Court gave a lengthy consideration to non-commercialactivities as commerce, concluding that education is indeedcommerce. 34The court stated:

The myriad financial considerations involved inbuilding programs, teacher's salaries, tuitionsand miscellaneous operating expenses attestto the commercialization which necessarily existsin the field of higher education, Despitethe opposition of many educators, there has beena recent trend toward the organization offaculty members to bargain collectively forbetter salaries and other benefits. any

institutions rent dormitory rooms and operatedining halls, book stores and other servicefacilities. Also there is a commercial aspectto the sharp competition for government andprivate contracts and the quest for researchgrants. In 1967-68 institutions of highereducation expended more than 17 billion dollars.The protection for the year 1976-77 is 41 billion.Higher education in America today possessesmany of the attributes of business. To holdotherwise would ignore the obvious and challengereality.

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The Appeals court overuled the lower court and dismissed the case onthe grounds that higher education was not commerce in this context.The court stated:

In this context, an incidental restraint oftrade, absent an intent or purpose to affectthe commercial aspects of the profession, isnot sufficient to warrant application of theantitrust laws.36

The court did not find the case compelling; they simply did notdecide the more difficult issue, whether education is commerce.This i3 illustrated by the court when it says "It is possible toconceive of restrictions on elegibility for accreditation that could

5

have little other than a comerci591 hettvo; and as such, antitrhhtwould presumably be applicable, "'It clear that the statedoes affect the commercial aspects of to erofession; conseenentlethe above case does not provide a clehr precedent. It is' also

clear that the State System is operated for other t"_Ana commercialpurposes which takes this case outside of the dictum noted above.This case provides little help in determining whether hieher educationis commerce,

There are two things which can assist in deciding whether educationis commerce. First is the fact that the general language ofthe antitrust acts was designed by Congress to exercise itspower under the commerce clause of the Constitution to the fullestextent possible.38Since regulating education is within ('.ingress' commercepower9 it seems that a court would easily find that education iscommerce within the meaning of the antitrust laws. The secondfact which must be noted is that dependinc! on the plaintiff thequestion of education as inter-state co=lerce 'Inv never arise. "hendeciding whe.7her commerce is being estraih0 it is propey to loo..: itthe trade which the Diointifr clo.1.3 1 °'201: _e

if the plaintiff is a doctor romn/aining about the State Systempractice of tying Riedical services to education, the relevantquestion-is whether medical services are commerce. If theplaintiff 13 a private school operated for profit in Oregon, thetrade of the plaintiff would have to constitute commerce for asuit to be successful. If the plaintiff is an independent, fouryear, non church related, college then once again it is theplaintiff's trade :which must constitute commerce in order for asuccessful suit.

Interstate

The last prohlem which spans 111 of the antitrust nets iswhether the State System is engager! in interstate commerce. *once

again the question may he resolved depending on who the plaintiffhappens to he. Leaving that question Aside it is still easy to seethat the State System is engaged in interstate commerce, interstatecommerce has been defined as "every negotiation and dealino betweencitizens of different states which contemplates and causes andimportation into one state from another, whether it he Roods orinformation. u4lAnother definition of interstate commerce points nutthat commerce is not confined to business activity in a conventionalsense but includes non business and non-nrofit activities, "botherprivate or governmental in nature and irrespective of whether Cloycompete with or may he substituted for by private enterprise,"42Boththe Sherman Act and the Federal Trade Commission Art tae a moreexpansive view of the requirement that the conduct underconsideration he interstate commerce than does the Clayton Aet.The Sherman Act and the Federal Trade Commission Act both anply toactivities which have a substantial effect on interstate commerce

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even though they aro completely intrastate.41The Clayton Act holdsto a more stringent test requiring the activities themselves to bein interstate commerce." The courts have held that the "operationof puhlic schools and hospitals by the several states and theirsubdivisions affect interstate commerce to substantial deereewhether or not such operations constitute interstate commerce. "65Although it seems clear from the definitions given above that theMate System is engaged in interstate commerce this question marpose some difficulties in Clayton,Act prosecutions.

The Sherman Act

Section I. in general this section states that any contract,combination, Jr conspiracy in restraint of interstate trade orcommerce is illegal. There are four main issues which arise under Sec-tion I of the Sherman Act."

1) What proof suffices to show a contract, combinationor conspiracy?

2) Does the conduct reviewed sufficiently affect interstatetrade or commerce?

3) What is the relevant market and what evidence is sufficientto establish that market?

4) In that market does the conduct challenged unduly restraincompetition?

1) Contract, Combination or Conspiracy

In order to find liability under Section 1 of the Sherman Act theremust be some concert of action between two parties in the form ofa contract, combination, or conspiracy.47An individual mayrestrain interstate commerce without coming within the inhibitionof Section 1 of the Sherman Act.48In order to bring the StateSystem under Section "1 of the Sherman Act some plurality ofaction must be found. The State System. is corposed of several highlyautonomous schools which are in competition with each other andwith other schools outside of the system. This system is run bythe State Board of Higher education (hereinafter the StateBoard) whose members are appointed by the governor. Thus the systemis somewhat analogous to a centralized corporation with therevenue and costs appropriated by a central headquarters.

The question which immediately arises when considering theState System is whether it 'is to be considered AS several firms whohave combined certain management decisions or whether the system isto be considered as one firm with several subsidiaries. Tf theformer is the case then a combination or conspiracy is the obviousform of the system, Sy combining management decisions in onebody the State System by definition would have formed a combinationor conspiracy,49If the courts find that the State s':,stem in actuallyonly one firm with several subsidiaries then proof of consnirney or

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combination becomes more difficult. Ye a recent case, the qupre-eCourt found that the defendants ha,! set ep their central lieensint.arrangement for the purpose of effectiny i market division scher'eand the Curt declared this to he a violation of section 1 of theSherman Act."The two most important Factors which the courts usewhen deciding whether an enterprise is beyond the scope ofSection 1 of the Sherman Act because it is only one firm. and cannotconspire with itself are the degree of autonomy (or converselythe lack of control) of one corporate relative to another, and theextent to which corporate relAtiV0S are held out as COMpetitOr01The Supreme Court hes noted that the rule that "common ownershipand control does not liberatecorporations from the impact of theantitrust lays" is especially aeplicable where affiliatedcorporations "hold themselves out As comnetitors." "The AttorneyCeneral's report points out that the substance of the SupremeCourt cases is that "concerted action between a parent and a

subsidiary or between subsidiaries which has for its purpose oreffect coercion or uereasonahle restraint on the trade of straneersto those acting in concert is prohibited by Section 153 T'ecentcases dealing with this question have generally favored the singletrader concept and have refused to find liability but immunity isnot euarantee(04 The Supreme Court recently has narrowed the scope ofthe single trader concept by holding that common ownership of corporatemembers in an enterprise where the corporations were operatingseparately "would not save them from any of the obligations thatthe law imposes on separate entities."51owever, the Ninth CircuitCourt of Appeals recently held that unincorporated divisions of asingle corporation cannot conspire in violation of Section 1of the Sherman AcO6 Although the structure of the State Systemis different from the structure of the conspiracies found in thecases above it is clear that a court could find that the StateBoard VAS a conspiracy.

2) interstate Trade or Commerce

This issue has already been dealt with and it is sufficientto note here that commercial service activities of any kind will con-stitute trade or commercand only those activities are beyond thereach of the Sherman Act which are purely local in the double sense thatthey (1) are not within the flow of interstate commerce and (2) haveno significant effect on that flow.58

3) !:arket

The relevant market has two aspects--eeographical and productparticipation. The product being supplied by the State System isundergraduate eddcation and the market certainly includes under-graduation education provided by private schools. nefinine thegeographical limits of the market is more difficult. The StateSystem draws student from all over thr world and nraduates of thatsystem travel to all parts of the world; however, it would be

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meaningless to speak or the world or ov0r1 the r, s. As the relevantmarket. Findine the relevant -arl.er is conaidered a eueation of raet)'awl in order to deternine rho ooperaphloal bonnda of the marketthe courta have supgeste,' ea.aminine the patterns of trade whichare followed in practice, the area of effective comnetition withinwhich the defendant overates6Ar the area in hich the defendant illplaintiff are in competitte42 Tn another case tha court limitedthe maret to the area,vhere the defendant had been rakinP hisgreatest efforts to become the sole supplier of replacement parts."The question of the relevant mar'cet area is one in which commonsense and the rule of reason plaY. a later,. part. Although theState System drays students from all over the world, it drawsover 907 of its students from the State of Oregon, ;Viso, over 907,or the. Oregon high school seniors who eo to college stay in theState of Oregon and, of the full time eeuiValent twelve studenthours taught in Oregon's four year colleoes, are toitoht in theState System. The State SyStemdrar.:s its second largest block ofstudents from California but to consider the State of Californiaas part of the relevant bar,.et would he to ignore reality. Theaverage oregon high school senior has little chance of attendingCr.lifornia school not only because of hioll admission atandardsbut also because of high oat-of-state tuitionif there is anycompetition on the undergraduate level it is only for the intellectualand financial elite.

A further araument ,Which indicates that Oregon is the relevantmarket is that by setting, up out-of-state tuition rates all over thecountry the State Systems have effected a market sharing arranperent.Although it might he impossible to attack this arrangement directlybecause of the Constitutional issues involved it can be arpued thatthe State System he. Mopped from clairine that the relevantmarket be anything other than the qtate of oreeen. By setting te,these out-of-state tuition rates the market has already been definedand since the State System has achieved such a measure of controlover the Oregon market they should not be allowed to argue that thearea of effective competition is any lareor. Also it must he keptin mind that the relevant market mieht Ile influenced by the plaintiffin a case against the State System. TF the snit were brought by aprivate college in Oregon which drew most of its students from Oregonthen the area of competition would be oregon which would then he therelevant marke04 The average high school senior in Orepon whowishes to attend a four year college must choose between the StateSystem and other schools in the country with tuition rates three orfour times higher. Viewed from that perspective it seems reasonableto say that the relevant market is Oregon.

4) Undue Restraint of Competition

The nsuil method of demonstrating undue reatraint of trade is toexamine the effect of the defendant's conduct in the market which has

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already been defined to see if that conInct unduly restrains trade.The courts usually look to the reasonableness of the conduct anddetermine (1) whether the defendant has enough marl:et power tomake the restriction an undue restraint of trade and (2) whetherthe defendant actually exercises the power or intends to do so."The State Fystem sells its product at shout 1/1 of the cost toproduce it. The effects of this pricing structure on the Oregonmarket has already been examined and the conclusion is clear --theprivate colleges are heinp driven out of the marketF (Sincethis report is to he used in conjunction with an in-depth economicanalysis of the State System, very little economic analysis isgiven here.) The State System does have and is using Its power toexercise a high degree of restraint on the trade or commerce in theOregon market.

There are some actions which the courts consider so likely toCause an undue restraint of trade that when one of those actions isproven there is a conclusive presumption that there has been anundue restraint of trade. The courts allow no evidence to beintroduced which would tend to prove that there had been no unduerestraint of trade or corImerce, These offenIss are called per seoffenses and the most common is price fixing, ^rice fixing includesnot only the establishment of uniform prices but an agreement upona range within which purchases or sales will be made as well;prices paid or charged are fixed if they are to be at a certainlevel, or on ascending or descending scales, or if by variousformula they are related to the market prices.64;ince the Stateitoard sets all tuition levels in the State System it is clearlyengaging in price fixing, The only evidence which can he introducedto defend a charge of price fixing is that prices were not fixed;the courts will not allow evidence of good faith or purpose since"a price fixing combination is not saved from sections 1-7(Sherman \et) of this title by the high purpose for which it isconceived."qqso the courts will'not allow evidence that theprice fixed is reasonable since the essence of the offen7°se is inthe power to set prices not the particular price set.

The State System also engages in tying or bundling which isa Ea se violation of Section 1 of the Sherman Act. Tying isdefined as a scheme which forces a customer to take a product hedoes not want in order to secure one he desires71By forcing, studentsto pay fees for medical services, athletic services, and otherstudent activities the State System is tying these prolucts to its mainproduct--education, This is a per se offense but it must also beshown that the State System has a high degree of power over the tyingproduct which is education,72 Since the amount of power the State Systemas approaches monopoly proportions and will he discussed elsewhereit will not be pursued here. The State System has more than enoughpower to make the tying which the State System nractices a La seoffense,

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It was mentioned earlier that the institution of out -of- statetuition has effected a sort of eareet sleerine errangement l'Atr t1V?public systems of hleher education in this country. "arket sharinparrangements are illegal ender Section 1 of the 'Mermen ectrhutthis problem is not discussed here because of the other difficultieswhich would be encountered, includinp roof of a conseiracv betweennll of the state systems, of higher education in the country,involving important state's rights questions. Tt is a problem worthpursuine but it is beyond the scope of this paper.

Section II. Section II of the Sherman Act has three substantiveoffen;77747177are separate from those covered under Section I.They aret74

1) to mononolize2) to attempt to monopolize3) to combine or conspire with an" other persons to rionopol.ize

any part of the trade or commerce (mono the severalstates, or with foreign nations.

1) Arnopolization

The offense of monopolization under section 2 or the Sherman Acthas two elements, (1) possession of monopoly noeer (2) and thewillful acquisition or maintenance of that power15 In order toestablish the monopoly rower of a firm a relevant market must heestablished both by the product and by eeoeraehical areal6 Theproblem of,market definition has already been dealt with in section1; it will he assumed here that the relevant market is the state orerevon. The hasic criteria For determinine whether a firm has monneelepower is to examine its nower to affect prices 77 The State Systemdoes nave this power as it sets tuition 1eveln at about 19 of the costof providing the service. The simile meet important criteria fordeciding, whether 1 monopoly exists is whether A firm has a largeshare of the market, although the courts have not yet establisheda prima facie rule for monopolization cases under section 2 of theSherman Act as they have done under section 7 of the Clpyton Act.In the Cellophane case the court indicated that had the market beenlimited to cellophane, the defendant's control of 757' of that marketwould have constituted monopoly power. I13 two other cases theSupreme Court found that 817 of the marke and 877 of the marketwere enough. 81The Grinnell case went one step further at theDistrict Court level by saying that when the defendant's dominantshare of the market had been established, the burden of disprovingmonopoly shifts to the defendant, "The Supreme Court did not endorsethe view since it found liability on more traditional grounds 30no prima facie rule has been established. As was mentioned earlierthe State System provides 85.587 of the full time equivalent hoursin the state of Oregon in four year colleges and there Is no doubtthat the State System, has monopoly ',over to the 9reeon market. Tt

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might also he argued alone the lines of the nrinaell case that thehigh share of the earet constitute n Tq",a facie case ofmonopolization,

The eecond element of a case of moneeolizntionis proof that themonopoly power has been willfully ohtateed or maintained. "ononolepower itself is not an offense ender Feet ion 2 of the Shermnn Act;it must he coupled with the pereoe or intent of acquiring ormaintaining that ronopoly.rhe intent required here is not npeciftcintent as required in attemptine to moeoeolizPbut can he shown byproving that Sectiont offenses have been committeer As winalready discussed the State System has been guilty of severalSection 1 offences including price fixiee, selling )0.low coat,tying, and possibly market sharing, '11.0 general intent necessaryfor the offense of monopolization can also be proven by shoving thatthe State Board took actions which contributed to their Monopolypower. By proving that the Board took actions which increasedits power and by using the maxim that A man intends the necessaryconsequences of his acts, sufficient eeneral intent can he shown, (;

Since the State Board has taken actions-such as continuing to exenndvhile other schools Yost studetAs-which thplenent their powertheir intent can readily he established,

elthoueh this eaper only set out to show a prima facie case ofantitrust violations against the State System there is one defensewhich is so often used that a word should be said hut it.This defense to the charge of monopolization is tl:At the monopolywas thrust upon the defendant, The courts have given some examplesof thrust upon defenses, "The defendant ray escape liability tfit bears the burden of proving that it owes its monopoly solely tosuperior skill, sueerior prOucts, natural advanteees, economic ortechnological efficiency."8iThe problem of this thrust upon defenseis obviated by stating the prima facie case in terms of "the willfulacquisition or maintenance of that power" a3 was done above; itprevents the defense from arguing the thrust upon defense since itwill already have been shown that they used illeeal activities toacquire or maintain their power. In the nrinnell case the Pistrictf:ourt contended that the thrust upon case "is the highly exceptional case,a rare avis more often found in academic groves than in the thicl.etsof bnsiness."88

A nonopoly can also be built up by 'av of a combination whichfollows the same males as a mono7oly resulting from internalerowth. The rule has been laid down that "a correct interpretationOE the statute makes it the crime of monopolization, une'erSection 2 of the Sherman Act, for parties 9., to comhtne or conspireto acquire or maintain the poser to exclude competitors from anypart of the trade or commerce among the severnt states or with foreignnations, provided they also have such a power that they are able, asa group, to exclude actual or potential competitton.""fhe questionof combination or consnirace was discussed above and nothing moreneed be said here. Once a combination or conspiracy has been

12

proven the question of intent wilV1 have h deen eal t with and the thnistupon defense will not be vfahle.

2) Attempt or Conspire to lonopolize

The last two offenses under Section 2 or the qhermpn pct arc to

attempt to monopolize and to conspire to mononolize. 111080 offensesare separate from monopolization and no showine is required thatmonopoly rower was ever attained.91 As with most cases of attenntor conspiracy to commit p substantive crime specific intent is required.`F;pecific intent means more than the renerat intent required for a

monopolization offense and when the charge is cg9spiracv proof orintent will merge with proof of the conspiracy.'- in the case or anattempt to monopolize specific intent can be shown through such evidenceIs documents, industrial backrround, or a course of conduct.94

There is some question as to whether it is necessary todefine a marlet when the charge is nttemPting or conspiring toronopo1 i4e. In tolsig v. Tidewater nil Co.95 the court flatly:tated that ".!'.hen the charge is attempt (or conspiracy) to monopollze

relevant Nar!:et is not an issue." The !lupreme rourt has notdirectly ruled on thin statement althoug in a dtctum in one casetTh- Court laid "to .establish mononolization or attempt to molosolea part of trade or commerce under Section 2 of the Sherman 'ct,Lt would he neCeSSar77 to appraise the exclusionary powex,... interms of the relelTant 1,-,nrl:et for the product involved. ..Innarently'

marl,et definition is till part of the prima facie case of an attemptor conpiracy to monopolize. Since the market has been discussedabove it will not be .dealt with here.

VT, The Clayton ;pct

Price !'iscrimination. Price discrimination Tiler the clarton 'kct has-----77 asheendeft7Trr-elv a Price difference." In order to establishprice discrimination between purchaser in violation of this section,there must lie wual sales at two different prices to two differentactual huyers.)' It is clear that by charging out-of-state tuitionrates the State System is engaging in price discrimination. ,Also

the State System enrages in price discrimination by charring differentgraduate and undergraduate tuition rates in cases where some of thesane courses are taken. The Clayton :Act re0res the commoditiesupon which a claim g price discrimination is founded by "of lil;egrade and quality." The State Board offers the identical product toout -of -state students at a higher rate than charred to in-statestudents so the question of like grade and quality will, not nosea problem here.

The Clayton ,Act does not rake every price discrimination illegalbut is restricted to certain classes of price discrimination. Beforeit can he sail that the ',tate Board has violated the Clayton iket it

10must be aho7.7n that: i

13

1) the State Board is a person2) higher education is a commacqt73) purchases involved in such !iscrimination are tn commerce4) the effect of such diScrimination --,ay he W-stantiallv to

lessen competition or tend to create a manopoly in snv lineof commerce, or to insure, destroy, or prevent cmpetition

1) Person

A person:is defined in 15U.s,C.12 as "including corporntiOnsand associations existing under or authorized by the laws of eitherthe United States, the la's of any of the territories, the lawsof an:, state, or the laws of any foreign country." It is clear that ifthe state Board was not a state agency it would certainly be a

norson within the meaning of th' antitrust 11VS. The only questionwhich must be resolved is whether this state affiliation causesthe State Board to cease to he a person. The Supreme court has pointedout that in construing the word person simple rules of constructionare not enough but resort must he *aide to the purpose of the fact,the subject matter, the context, an'l the legislative history.Such a study has since been made by the Snoreme Court when theyfound a state to he a persopovithin the meaning of the antitrust forpurposes of a private suit, The Court pointed out that there is noreason to suppose that Congress meant to leave the states withoutany antitrust remedy. Since the word person is construed to beused with the some meaning throughout the actl03it is clear that thestate could also be a person subject to suit for antitrust violation.°4The state affiliation question makes no difference here and sincethe State Board has the power to "institute, maintain, and per-ticipate in suite105there is no exemption for the State System here,It should be noted that 15 1'.(1.C.13c creates a specific exemptionfor schools and other institutions to the price discriminationportion of the Clayton Act for the purchase of sunplies,mention is made or an exemption for any other purposes.

2) commodity

The ',ford commodity has not been subjected to much ludicialbut it has ton held that commodity "must he given its usual andnatural meaning,"106Some of the usual meanings given to commeditginclude all things possessing attributes ofAgneib 0le existence,an article of movable or

luogrsonal property, 1 IJO

that affords. convenience or advantage, r any subject of commerce,11/A collegeeducation is something which.is probably advantageous, can he soldand moved, a..1 as mentioned above is an object of commerce.

3) commerce

The fact tilet education is r'.r has already been discussedand it has alreJ* .1)en pointed out that the Clayton ^rt holds toa more narrow reulatton of interstate co,Trerce, `ince the pricediscrimination takes place precisely against those prlople who

14

cross state lines that is no problem in saying that the commerceaffected by the price discrimination is interstate. 111

4) ';Lessen Competition

Proof of a price discrimination atone will not make nut a primafacie case under this section of the Clayton Act, 112 The statute providesfor proof of some damage to some level of competition.113 The pricediscrimination practiced by the state has its greatest effecton the sehoole who are in competition with the State System sothe primary level of comnetition is the one under consideration,The courts examine the economic situation and declare a pricediscrimination a violation if it is reasonably probably that thediscrimination will hayn a substantial erfect on competition."'The emphasis here should be on the visor of competition rather thanthe hardship of individual institutions. 115 The courts have Alwaysruled that predatory below cost pricinp will support a cindinp orcompetitive injury. 116 It should he pointed out here that althoughthe members of the State hoard probably do not wish to harmcompetition by engaging in price discrimination,. their goodmotives are no defense to an antitrust claim."' The courts areslow to infer injury here and usually demand some nronf of marketconditions.

Tyine his already been discussed as a violation of the S'nerrn-1Act and it is al.'s A violation of the ellvton or.ltn,, of

titer section of tho Clayton Act rohthitine twine is vet,' sirqt1nrto t)e wordine, in the section of the Clayton Act on "rice

Mc question of ,/beCler the State roard in n personand t:hethor education in n co7tmolitv arise under this section butare resolved by the discussion in the last chanter, Tn adlitionunder this section it must be shown that the State System or theplaintiff in a case against the State System are engaged intrade which is interstate commerce,

After proof has been given that a product has been tied,according to statute some proof must he made that competition has beensubstantially lessened or that a monnpolv is tending to becreated. This proof can he made directly by showing market conditionsor by simpler methods which the courts have established, Tyingis considered a 221 se offense under the Sherman Act and it hasbeen regarded equally as harshly under the Clayton Act. The testgiven fot determining lessening of competition is stated Aso .

"where the seller enjoys a Monopolistic InnttiOn in the, marketfor the tying 'product, or if a substantial volume of commerce inthe. tied product is restrained the equisite potentiallessening of competition is inferred." This

r18

T his test of illegalityhas been made even easier by chaneinc the requirement of mononolvpower to "sufficient econ' .1.c power" to produce npprertnblesvestraint."119 Since the State System has a virtual mononolv ponitIonin education as mentioned before an4 since the tying amounts to ()bout

15

per studyRk per quarter the roeu(lite competitive injury spu'-!'oe inferrod,` ,tlse competitive injure can 1,e tulerred simply

12showily that an appreciable amount of co7,1merce ans ',eon tie J, 1

V114 Federal Trade Commission Act

The rederal Trade Commission Act and the Clayton Act were pasedin 1914 and were designed to supplement the general prohaitions of CieSherman Act, The Clayton Act was aimed at specific practicer; thoughtto be commonly used to gain monopoly power while the phrase "unfairmethods of competition" in the Federal Trade Commission Act WASleft undefined in order to create flexibility and elasticity ininterpretation and to give tile Commission broad powers to curbanticompetitive practices, Violations of either the Sherman orClayton Act have

2keen held to be violations of .the rederal Trade

Commission Act, t 3since the Federal Trade Commission Oct is intendedto be supplemental.the courts have held that actions which fall shortof being Sherman or Clayton Act offenses are prohibited by the rederal.Trade Commission Act,124Tt has been held that lack of a combinationor conspiracy necessary for a Section 1 Sherman Act offenv will notdefeat an action under the Federal Trade Commission Act,14Individualor concerted conduct which falls short of being a Sherman Actviolation may as a matter of law constitute an unfair method ofcompetition,I26Arrangements similar to tying agreements have beenheld to be violations of the rederal Trade Commission At since thi!Yrun counter to the public policy proclaimed in the federal antitrustlaws,127

The analysis in the sections on the Sherman and Clayton Acts hasshown that the State System is guilty of violAtinr,, the substantiveportions of the antitrust laws, The Federal Trade Commission Actwas designed to deal with situations in which the snirit of theantitrust laws was being violated but technicalities preventedprosecution. The Commission is supposed to determine for itself whateconomic effects are sufficient to produce an unfair method ofcompetition.128Fnfordement of the Federal Trade Commission Act isavailable only through Commission action and the commission must actonly when it finds action to be in the public interest,129Theconsideration of public interest weighs strongly in any Commissionaction since it is both a necessary and can he a sufficient reasonfor finding a violation of the Federal Trade Commission Actol"

Conclusion

The forgoing analysts has presented the main arguments which wouldbe present in any antitrust action against the State System, A courtdecision finding the State System in violation of antitrust law wouldsurely be a larPe step but one which is not without a firm foundation,

16

The State System. is clearly in violation of the substantive portionsof the antitrust lay even if toehnicalities prevented a successfulsuit. The appropriate response to this study is not to loo forloopholes for the State System but throue,h legislative action toresolve the obvious conflicts between the State System as it nowstands and the policies behind the antitrust laws,

17

InOTNOTES

1State Dd. of Ins. V, Todd Shipyards Corp., 370 ". S, 451 (1962);Bibb v. Navajo Freight Lines Inc., 359 m. S. 520 (1959)

20,R.S, 666.010-646,180 (1971)

3Ancle v. Chicago, St. Paul, & Omaha qy. Co, 151

m. S. 1 (1893)

4Pieref! v, Society of Sisters, 268 U, S, 510 (1925)

5Ka0.enbach v. Clung, 379 U. S. 296 (1964)

'State of New York v. United States, 326 V. S. 572 (1964)

713oard of Trustees of Illinois v. United States, 289 U. S. 48 (1932)

8A4ams Fxpress Co, v. Ctoninger, 226 V. S. 491 (1913); IllinoisNatural Pas Co. v. Central Illinois Public Service Co., 314 U. S.

498 (1942)

9Uaited States v. State of California, 297 U. S. 175 (1936)

10Case v. Bovies, 327 U, S. 92 (1946) in which the court found that

land owned by a nublic board of education was subject to price

controls.

11317 1,, 5, 341. (1943)

12Id, at 341)

13Id, at 350-51

"Id, at 351; see also Northern Securities Co. v. United States,193 U. S. 197,332,344-7 (1904)

151d. at 351; see also Union Pacific P, CO, v. United States,313 11, S. 450,464 (1941)

I6Actions found unreasonable; Bale v. Glasgow Tobacco Bd. of Trade,339 r, 2d 281 (6th cir. 1964); American red, of Growers v. Neal,183 869 (4th cir, 1950); actions found reasonable; Asheville

Tobacco Bd. of Trade v. FTC, 263 F. 2d 502 (4th cir. 1959); WinnAve. Warehouse v. Winchester Tobacco "arehouse, 341 F.24 287(6th cir. 1965)

17Allstate Ins. Co, v. Lanier, 361 r.2d 370 (4th cir, 1966), Cett.

denied 385 U. S. 930 (1966)

1811arman v, _Valley Nat'l Bank, 339 v.24 564 (9th cir, 1964)

18

19rx. .:iggins Airways Inc, v, 7tassachusettes Port Authority*362 ".2d 52 (Lit cir. 1966)

20Parmlee Transp. Co. v, Keeshin, 292 r,2d 794 (7th cir, 1°61)

21Ceorce7, Whitten, Jr., inc. v. Paddock Pao]. Builders, tnc.,

424 r,2d 25,30 (1st cir. 1970)

22Travelers Ins. Co..v. Blue Cross, 298 F. Supp. 1109,1111-2 (W.r',Pa, 1969); Norman's on the /aterfront, Inc, v. Wbenteley, 444F.2d 1011,1014-18 (3rd cir, 1971)

23424 P.2d 25,30 (1st cir. 1970)

24See wiggins Airways Inc. v,362 r.2d 52 (1st cll., 1966)

'iassachusettes Port Authority,

15Schenley Indus., Inc, v. 'dew Jersey ine & Spirit 'TholesalersAss'n., 272 F,Supp. 372 (B,W.J. 1967)

26Northern Securities Co. v, United States, 193 T.1 S. 197, 347-50(1904); Travelers Ins. Co. v. Blue Cross, 298 r, Supp. 11119(.P. Pa. 1969); Asheville Tobacco Bd. of Trade, Inc. v. rn,263 P. 2d 502 (4th cit. 1959)

27Ploride Avocado Growers v. Paul, 373 ".S. 132 (1962)

28Woods Exploration Pro, Co, v. Aluminum Co. of America, 4381'.2d 1386 (1971)

29444 P.2d 931, (D.D.C. 1971)

30td, at 936

31Bro.In v. Parker, 39 F.Supp, 895 (1941)

32American Bar Association, Antitrust nevelopments 1955-1968, Chica9o,1968, p. 215 (Hereinafter A,B,AS

33American !'edical AssIn. v, United States, 317 U. S. 519 (1943);United States v. Schubert, 348 U. S. 222 (1955)

34,,'arjorie Webster Junior Coltepe v.459 (D.D,C, 1969)

351dat 465

!iiddte States 302 F. SOT).

36Marjorie Webster Junior College v. !!iddle States, 432 r,2d 650,652 (1970)

19

371d. at 653

3

Page v. Work, 290 r,2d 323 (9th cir, 1961); United States v,Southeastern Underwriters Assn., 322 V, S. 533 (1944)

39Case v. Bowles, 327 U, S. 92 (1946)

40Webster v. Middle States, 302 F.Supp, 459,465 (1969); Americanredical Assin. v. United States, 317 U. S, 519, 528, 529 (1943)

41Progress Tailoring Co, v, FTC, 153 r.2d 103 (7th cir. 1946)

41-State of Maryland v. Wirtz, 269 r.Sunp. 826 (1967), affd. 392U. S.' 183

"United States v. Wrightwood Dairy Ca., 315 V. S. 110 (1942); Bliecev. Ford 389 U. -S. 320 (1967); United States v. Painters Dist.Council No, 14, 44 Fad 58 (P.C. Ill. 1930)

"Sears, 'Roebuck & Co. v, Blade, 110 !'.Sapp. 96 (P.C. Cal, 1953);!leyers v. Shell Oil, 96 P.Supp, 670 (D.C, Cal. 1951)

45State of Naryland v, Wirtz, 269 v.Supp, 826 (1967)

46?eport of the Attorney General's National Committee to Study theAntitrust Laws, 1935, p. 12 Thereinafter Att. (len.)

47Lawton v. Loewe, 290 ".2d 721 (1913)

43Paramount Pictures v, United 'lotion Picture Theatre 'havers, 93F. 2d 714 (1938)

49United States v, American Column & Lumber Co. 257 &, S. 377 (1920)

)°I, nited states v. Sealy, Inc., 388 D. S. 350 (1967)

51A,B.A, n, 20

rlkel fer-Ste:/art 1'0. v. Josenh211,215 (1951)

Soactram & Sons, Ire., 140 no So

53Att. Gen. n. 34

54Payco Ifp. Co. v. Dunn, 234 r,Supn, 593 QI.D, Ill, 1964); Sunl:i4tCrosiers v, Winklnr /". Smith 370 U, S. 19 (1962)

55Pnrma Life "ufftnra, Inc. v. TnternationAt Peal rorle, 392U, S. 134 (1968)

56los. Seagram t Sons, Inc. v. havaiian nke 6 Liquors, tT,nt,416 v.24 71 (9th cir, 1969)

20

57A-0d., p. 38

58Id. at :19

59unitod States v. Grinnell Corp. 384 ". S. 563 (1966)

"United States v. United Shoe "achine Corp. 110 F,Sunp 95 (n.C,"ans. 1953), affd. per curium 347 U, 8, 521 (1954)

"Standard Oil of Cal. v. United States. 337 ". S. 293 (1949)

°Indiana Farmers cuide Pub, Co. v. Prarie Farmers Pub. Co., 293s. 263 (1934)

b3i'nited States v. Yellow Cab, 232 U, S. 218 (1947)

"Indiana rATMerS Guide Pub. Co, v. Prarie rarmer -ub. Co., 2938, 261,(1934)

65Board of Trade v. united States, 147 r,2d 93 (1944)

"Wish, John n., Cooke,- lomney 1.1" S, maltby, Gregory P., "U(H)ither

the Private. College" unpublished Consumer nights research Center,Eugenel-Ore. Sept. 1971

"United States v. Trenton Potteries Co., 273 U. S. 392 (1927)

"American Tobacco v. United States, 147 rod 93 (1944)

694inl V. Spina, 148 r.2d 647 (1945)

70United States v. Trenton Potteries, 273 U. S. 392, 396-98 (1927)

71 Brown Shoe Co. v. United States, 370 V. S. 294, 330 (1962)

72Northern Paco Py. v. United States, 356 U. S. 1 (1958)

73Uhite "otor Co. v. United States, 372 S. 253 (1963)

74Att. Gen. at 43

75tlnited States v. Grinnell Corp., 384 U. S. 563 (1966)

76lndiana Farmer's Guide Pub. Co. v. Prarie Farmer Pub. Co.,293 U. S. 268 (1934)

77t'nited States v. Addeston Pipe & Steel Co., 175 U. S. 211 (1899)

78A.B.A. at 31

79United States v. E.I. du Pont de Nemours & Co., 351 q, 377 (1956)

21

80International Boxing Club v, United States, 358 p S.

81United States v. ';rinnetl, 384 IT, 563 (196')

821:ntted States v. Grinnell., 236 r.snon. 234,257 (1966)

83United States v. crlffith, 334 1'4 S. 100 (1948)

242 (1951)

8/+American Tobacco Co, v. United States, 147 '".2d 93 (1944)

5Att. Gen, at 56

35VntteA States v, Aluminum Co, of America, 148 T,,2d 416 (2d cir.1945)

87united States v. United Shoe 1!achinery corn., 110 r.supp. 295(2, "ass. 1953)

88rattea States V. 0,rinnell Corp, 21r, r,Supp. 244,248 O.1964)

39American Tobacco Co.

90Att. Gen. at 61-3

v, United States, 382 U, S, 781 (1946)

1 United States v. Griffith, 334 tc, S. 100,107 (1948) conspiracy;United States v. Columbia Steel Co., 134 11.:.495,531 (1948)attempt to monopolize; violation may be slum even though norestraint unreasonable under Section 1 is effected

92Swift & Co. v, United States, 276 1", S. 311 (1928)

91United States v, Consolidated Laundries Corp., 291 r.2d 563(2d cir, 1961)

941:ansas City Stor. co. v. United States, 240 r.2d 643 (8th cir.1957)

95327 r.2d 459 (9th cir. 1964)

96Vall'er Process Equipment, Inc, v, Food 1'ech, F, Clem, Corp., 3B2U. S. 172 (1965)

97ETC v. Anheuser-Busch Inc., 363 U. S. 536 (1960)

98,Goodman & Son v. United Lacquer "f, Corp., 81 r.supp. 890

(2, 'lass 1949)

15 13

22

10015 P.S.C. 13

"United States v. Cooper Corp., 312 U, S. 600,605 (1941)

1020eor gia v. vans, 316 U. S. 159 (1942); State of ceorgia v, TM.P, Co. 324 U. S. 875 (1945)

113United States v. Cooper corp., 312 U, S. 600,606 (1941)

1°Ar3eorgia v. Evans, 316 II. S. 159,163 (1942)

1°50.P.S. 351.060 (5) (1971)

106Cnited States v. Investors Diversifiel Services, 102 F.Supp. 645(n. Minn. 1951)

107Burns v. Donohue, 79 r. Supp. 107,108 (o.N.1. 1948)

"Croup Ilealth ro-op of Puget Sound v,237 P.2d 737,764 (1952)

109eKeon v. Uolf, 77 Ill. App. 325

110Eastnan Kodak Co. v. Home Utilities Co. 234 r,2d 766,772 (4thcir. 1956)

111,eyers v. Shell Oil, 96 F.Supn. 670 (n. 1951)

King County '!edieni SOC.,

112'*eaCis' Find Bread Co. v. "oore 208 F.2d 777 (10th cir. 1953)

113United states v. F.I.231 (n. ')el. 1953)

114=iinneapolis-Honeywell regulator CO, V. rTC, 191 r,2d 786,789(7th cir, 1951)

du Pont De *'ours Co., 118 ". Supp. 41,

115Palian Ice Cream Co. v, Ardens "arms Co., 104 F.Supp, 796, 301(1,D. Cal. 1952)

116Toster Mfg. Co. v. "Tr, 335 F,2d 47 (1st cir. 1964);Co. v. Continental Baking Co., 386 U, S. 685 (1967)

117raramount Famous Lasky Corp. v. United States, 282 fr. S. 10 (1911).

118Times-Picayune Publishing Co. v. United States, 345 1!. S, 594,

408 -9 (1953)

119-orthern Pacific railway re). v. United States, 356 U, Si 1,11 (1958)

ITtll nip

120United tates v, Loew's Inc., 371 U, S. 38 (1962)

23

121rortner Enterprises, Inc. v. United States Steel rorp. 194 U. ',495 (1969)

122A.B.Ao at 252; rTc v. notion Picture Advertisinp Service co.,344 U. S. 392 (1953)

123Sberman, rTc v. Cement Institute, 333 u. S. 683 (1948); tying,Tires- Picayune Pub, Co, v. United States, 345 U. S. 594 (1953);Price Discrimination, American News Co. v. rTc, 300 F,2d 104(2nd eir. 1952)

124Eashion Originators' Guild v. rTC, 312 U. S. 457,463 (1940)

145rrc v. cement Institute, 333 U. S. 681,721 (1948)

1261d. at 708

127AtInntic Refining Co. v. ETC, 381 V. S. 357 (1965)

128Beeet-Nut Packing Co, v, ITC, 264 ro 8E5 (1920), revel on othergrounds 257 U. S. 441

129 15 V.S,C. 45

130rothschild v. T'TC, 200 F,2d 39 (7th cit. 1953), cart, denied345 '1. 54 941

24

The preceeding intern report'vas completed by the following intern:

Name: Gregory Hartman

Address: 2290-2 Patterson DriveEugene, Oregon 97405

Immediately prior to this internship, the intern was a student at:

College:

Major Field:

Year in School:

University of Oregon

Law

1st year law student

The preceeding intern report was read and approved by:

Name: Dr. John Wish

Title: Director

Address: Consumer Rights Research CenterUniversity of Oregon107 Commonwealth Bldg.Eugene, Oregon 97403

If you h.ve further comments about this intern report, please write or phone:

Bob Hullinghorst, DirectorResources Development Internship ProgramWestern Interstate Co mission for Higher EducationP.O. Drawer "P"Boulder, Colorado 80302

Phone: (303) 449-3333

THE RESOURCES DEVELOPMENT INTERNSHIP PROGRAM

The preceding report was completed by a WICHE intern during the summer of 1972.

This intern's project was part of the Resources Development Internship Program

administered by the Western Interstate Commission for Higher Education (WICHE).

The purpose of the internship program is to bring organizations involved in com-

munity and economic development, environmental problems and the humanities togeth

er with institutions of higher education and their students in the West for the

benefit of all.

For these organizations, the intern program provides the problem-solving talents

of student manpower while making the resources of universities and colleges more

available. For institutions of higher education, the program provides relevant

field education for their students while building their capacity for problem-solving.

WICHE is an organization in the West uniquely suited for sponsoring such a program.

It is an interstate agency formed by the thirteen western states for the specific

purpose of relating the resources of higher education to the needs of western citi-

zens. WICHE has been concerned with a broad range of community needs in the West

for some time, insofar as they bear directly on the well-being of western peoples

and the future of higher education in the West. WICHE feels that the internship

program is one method for meeting its obligations within the thirteen western

states. In its efforts to achieve these objectives, WICHE appreciates having re-

ceived the generous support and assistance of the Economic Development Administra-

tion, the Jessie Smith Noyes Foundation, the National Endowment for the Humanities,

the National Science Foundation, and of innumerable local leaders and community

organizations, including the agency that sponsored this intern project.

For further information, write Bob Hullinghors , Director, Resources Development

Internship Program, WICHE, Drawer "P", Boulder, Colorado, 80302, (303) 449-3333.

DEPOSITORY LIBRARIES

Copies of many intern reports printed by WICHE may be obtained on loan

directly from WICHE or through one of the following depository libraries:

University of Alaska LibraryCollege, Alaska 99735

University of Arizona LibraryTucson, Arizona 85721

University of California LibraryRerkeley, California 94720

University of California LibraryLos Angeles, California 90024

Norlin LibraryUniversity of ColoradoBoulder, Colorado 80302

Gregg M. Sinclair LibraryUniversity of HawaiiHonolulu, Hawaii 96822

University of Idaho LibraryMoscow, Idaho 83843

University of Montana LibraryMissoula, Montana 59801

University of NevadaReno, Nevada 89507

University of New Mexico LibraryAlbuquerque, New Mexico 87106

University of Oregon LibraryEugene, Oregon 94703

University of Utah LibrarySalt Lake City, Utah 84112

University of Washington LibrarySeattle, Washington 98105

University of Wyoming LibraryLaramie, Wyoming 82070

The ideas and opinions expressed

in this report

are those of the author.

They do not necessarily reflect

the views of the

WICHE Commissioners or WICHE staff.

The Resources Development Internship Program

has been financed during 1972 by grants

from the

Economic Development Administration,

Jessie Smith Noyes Foundation,

National Endowment for the Humanities,

National Science Foundation

and by more than one hundred community

agencies throughout the West.