Hopkins v. Oxley Stave Co.

THAYER, Circuit Judge.

This case comes on appeal from an order made by the circuit court of the United States for the district of Kansas, granting an interlocutory injunction. The motion for the injunction was heard on the bill and supporting affidavits, and on certain opposing affidavits. There is no substantial controversy with reference to the material facts disclosed by the bill and accompanying affidavits, which may be summarized as follows: The appellants, H. C. Hopkins-and others, who were the defendants below, are members of two voluntary, unincorporated associations, termed, respectively, the Coopers’ International Union of North America, Lodge No. 18, of Kansas City, Kan., and the Trades Assembly of Kansas Oily. Kan. The first of these associations is a labor organization composed of coopers, which has local lodges in all the important trade centers throughout the United States and Canada. The other association, the Trades Assembly of Kansas City, Kan., is a body composed of representatives of many different labor organizations of Kansas City, Kan., and is a branch of a general organizaÍ ion of the same name which, exists and operates, by means of local assemblies, in all the principal commercial centers of the United Status and Europe. The Oxley Stave Company, the plaintiff below and appellee here, is a Missouri corporation, which is engaged at Kansas City, Kan., where it has a large cooperage plant, in the manufacture of barrels and casks for packing meats, flour, and other commodities. It sells many barrels and casks annually to several large packing associations located at Kansas City, Mo., and Kansas City, Kan., and also has customers for its product in 16 other states of the Union, and in Europe. Its annual output for the year 1895 was of the value of $164,173. For some time prior to November 16, 1895, the plaintiff company had used successfully in its cooperage plant at Kansas City, Kan., certain machines for hooping barrels, which materially lessened the cost of making the same. It did not confine itself exclusively to the manufacture of machine-hooped barrels, but manufactured, besides, many hand-hooped barrels, and employed a large number of coopers for that purpose. The wages paid to the coopers in its employ were satisfactory, and no controversy had arisen between the plaintiff, and its employés on that score. On or about November 16, 1895, the plaintiff company was informed by a committee of persons representing the local lodge of the Coopers’ Union, No. 18, at Kansas City, Kan., that it must discontinue the use of hooping machines in its plant. Said committee further informed the plaintiff that they had already notified one of its largest customers, Swift & Co., that, in making contracts, with the plaintiff for barrels, the Coopers’ Union would require such customer, in future, to specify that all barrels supplied to it by the plaintiff must be hand-hooped. None of the members of this committee were employés of the plaintiff company, and, with one exception, none of the present appellants were or are in its employ. At a later date the Coopers’ Union, No. 18, called to its assistance the Trades Assembly of Kansas City, Kan., for the purpose of enforcing its aforesaid demand; and on or about January 14,1896, a committee of persons representing both of said organizations waited upon the manager of the plaintiff company, and notified him, in substance, that said organizations had each determined to boycott the product of the plaintiff company unless it discontinued the use of hooping machines in its plant, and that the boycott would be made effective on January 15, 1896. The formal action taken by the Trades Assemblv was evidenced by the following resolution:

“To the Officers and Members of the Trades Assembly — Greeting: Whereas, the cooperage firms of J. R. Kelley and the Oxley Cooperage Company have placed in their plants hooping machines operated by child labor; and whereas, said hooping machines is the direct cause of at. least one hundred coopers being out of employment, of .which a great many are unable to do anything else, on account of age, and at a meeting- held by Coopers’ Union No. 18 on the 31st of December, 1895, a committee was appointed to notify the above firms that unless they discontinued the use of said machines on and after the 15th of January, 1890, that Coopers’ Union No. 18 would cause a boycott to be placed on all packages hooped by said machines the 15th of January, 189G, and at a meeting held by Coopers’ Union No. IS on the 4th of January, 1896, delegates were authorized to bring th§ matter before the Trades Assembly in proper form, and petition the assembly to indorse our action, and to place the matter in the hands of their grievance committee, to act in conjunction with the committee appointed by Coopers’ Union No. 18 to notify the packers before letting their contracts for their cooperage: Therefore, be it resolved, that this Trades Assembly indorse the action of Coopers’ Union No. 18, and the matter be left in the hands of the grievance committee for immediate action.

“Yours, respectfully, J. L. Collins,

“Sec’y Coopers’ International Union of North America, Lodge 18.”

It was also charged, and the charge was not denied, that the members of the voluntary organizations to which the defendants belonged liad conspired and agreed to force the plaintiff, against its will, to abandon the use of hooping machines in its plant, and that this object was to be accomplished b^ dissuading tlie plaintiff’s customers from buying machine-hooped barrels and casks; such, customers to be so dissuaded through fear, inspired by concerted action of the two organizations, (hat the members of all the labor organizations throughout the country would be induced not to purchase any commodity which might be packed in such machine-hooped barrels or casks. The bill charged, by proper averments (and no attempt was made to prove the contrary), that the defendants were persons of small means, and that the plaintiff would suffer a great and irreparable loss, exceeding $100,000, if the defendants were allowed to (tarry the threatened boycott into effect in the manner and form proposed. The injunction which the court awarded aga inst the defendants was, in substancie, one which prohibited them, until tlie final bearing of the case;, from making effective the threatened boycott, and from in any way menacing, hindering, or obstructing the plaintiff' company, by interfering with its business or customers, from the full enjoyment of such patronage and business as it might enjoy olpossess independent of such interference.

The first proposition contended for by the appellants is that the (rial court acted without jurisdiction in awarding an injunction. The ground for this contention consists in the fact that in the bill, as originally filed, two persons were named as defendants who werfe citizens and residents of the state of Missouri, under whose laws the Oxley Stave Company was incorporated. But as the case was dismissed as to these defendants, and as to the two voluntary unincorporated associations, and as to all the members thereof who were not specifically named as defendants in the bill of complaint, before an injunction was awarded, and as the bill was retained only as against persons concerned in the alleged conspiracy who were citizens and residents of tlie state of Kansas, the objection to the jurisdiction of the trial court is, in our opinion, without merit. Oxley Stave Co. v. Coopers’ International Union of North America, 72 Fed. It is further urged that tlie trial court had no right to proceed with the hearing of the case in the absence of any of the persons who were members of the two voluntary organizations, to wit, the Coopers’ Union, No. 18, and flu* Trades Assembly of Kansas Oiiv, Kan., because all the members of those organizations were parties to (lie alleged conspiracy. This contention seems to be based on the assumption that every member of the two organizations had'the right to call upon every other member for aid and assistance in carrying out tlie alleged conspiracy, and that an injunction restraining a part of the members from rendering such aid and assistance would necessarily operate to lhe prejudice of those members who had not been made parties to the suit. In oilier words, tlie argument is that certain indispensable parties to (he suit have not been made parties, and (hat full relief, consistent with, equity, cannot be administered without. their presence upon the record. We do not dispute the existence of the rule which the defendants invoke, but it is apparent, we think, that it has no application to the case in hand. The present suit proceeds upon the theory — without which no relief can be afforded — that the agreement entered into between the members of the two voluntary associations aforesaid is an unlawful conspiracy to oppress and injure the plaintiff company; that no right whatsoever can be predicated upon, or have its origin in, such an agreement; and that the members of the two organizations are jointly and severally liable for whatever injury would be done to the plaintiff company by carrying out the object of the alleged agreement. The rule is as w;ell settled in equity as it is at law that, where the right of action arises ex delicto, the tort may be treated as joint or several, at the election of the injured party, and that he may, at his option, sue either one or more of the joint wrongdoers. Cunningham v. Pell, 5 Paige, 607; Wall v. Thomas, 41 Fed. 620, and cases there cited. We perceive no reason, therefore, why the case was not properly proceeded with against the appellants, although numerous other persons were concerned in the alleged combination or conspiracy.

We turn, therefore, to the merits of the controversy. The substantial question is whether the agreement entered into by the members of the two unincorporated associations to boycott the contents of all barrels, casks, and packages made by the Oxley Stave Company which were hooped bv machinery was an agreement against which a court of- equity can afford relief, preventive - or otherwise. The contention of the appellants is that it was a lawful agreement, such as they had the right to make and carry out, for the purpose of maintaining the rate of wages then paid to journeymen coopers, and that, being lawful, the injury occasioned to the plaintiff company, no matter how great, was an injury against which neither a court of law nor equity can afford any redress. According to our view of the case, the claim made by the defendants below, that one object of the threatened boycott was to prevent the employment of child labor, is in no way material; but, in passing, it will not be out of place to say that this claim seems to have been a mere pretense, since it was shown that the machinery used to hoop barrels cannot be managed by children, but must, of necessity, be operated by persons who have the requisite strength to handle barrels and casks' weighing from 75 to 80 pounds with great rapidity. It is manifest that this is a species of labor which could not, in any event, be performed by children. Neither do we deem it necessary on the présent occasion to define the term “boycott”; for, whatever may be the meaning of that word, no controversy exists in the present case concerning the means that were to be employed by the members of the two labor organizations for the purpose of compelling the plaintiff company to- abandon the use of hooping machines. It is conceded that their purpose was to warn all of the -plaintiff’s immediate customers not to purchase machine-hooped barrels or casks, and to warn wholesale and retail dealers everywhere not to handle provisions or other commodities which were packed in such barrels or casks. This warning was to be made effectual by notifying the members of all associated labor organizations Throughout the United States, Canada, and Europe, not to purchase provisions or other commodities, and, as far as posBible, to dissuade others from purchasing provisions or other commodities wnick were packed in machine-hooped barrels or casks. The object of the conspiracy, it will be seen, was to interfere with the complainant’s business, and to deprive the complainant company, and numerous other persons, of the right to conduct their business as they thought proper. To this end, those who were engaged in the conspiracy intended to excite the fears of all persons who were engaged in making barrels, or who handled commodities packed in barrels, that, if they did not obey the orders of the associated labor organizations, they would incur the active hostility of all the members of those associations, suffer a great financial loss, and possibly run the risk of sustaining some personal injury. It may be conceded that, when the defendants, entered into the combination in question, they had no present intention of resorting to- actual violence for the purpose of enforcing their demands; but if is manifest that by concerted action, force of numbers, and by exciting the fears of the timid, they did intend to- compel many persons to surrender their freedom of action, and submit to the dictation of others in the management of their private business affairs. Another object of the conspiracy, which was no less harmful, was to deprive the public at large of the advantages to be derived from the use of an invention which was not only designed to diminish the cost of making certain necessary articles, but to lessen the labor óf human hands.

While the courts have invariably upheld the right of individuals to form labor- organizations for the protection of the interests of the laboring classes, and have denied the power to enjoin the members of such associations from withdrawing peaceably from any service, either singly or in a body, even where such withdrawal involves a breach of contract (Arthur v. Oakes, 11 C. C. A. 209, 63 Fed. 310), yet they have very generally condemned those combinations usually termed “boycotts,” which are formed for the purpose of interfering, otherwise than by lawful competition, with the business affairs of o-thers, and depriving them, by means of threats and intimidation, of the right to conduct the business in which, (hey happen to be engaged according to the dictates o-f their own judgments. The right: of an individual to carry on his business as he sees fit, and to use such implements or processes of manufacture as he desires to use, provided he follows a lawful avocation, and conducts it in a lawful manner, is entitled to- as much, consideration as his other personal rights; and the law should afford protection against the efforts of powerful combinations to rob Mm of that right and coerce his will by intimidating his customers and destroying his patronage. A conspiracy to- compel a-manufacturer to abandon the use of a valuable invention bears no resemblance to a combination among laborers to withdraw from a given employment as a means of obtaining better pay. Persons engaged in any service have the power, with which a court of equity will not interfere by injunction, to abandon that service, either singly or in a body,' if the wages paid or the conditions of employment are not satisfactory; but they have no right to dictate to an employer what kind of implements he shall use, or whom he shall employ. Many courts of the highest character and ability have held that a combination such as the one in question is admitted to have been is an unlawful conspiracy, at common law, and that an action will lie to recover the damages which one has sustained as the direct result of such a conspiracy; also, that a suit in equity-may be maintained to prevent the persons concerned in such a combination from carrying,the same into effect, when the damages would be irreparable, or when such a proceeding is necessary to prevent a multiplicity of suits. The test of the right to sue in equity is 'whether the combination, complained of is so far unlawful that an action at law will lie to recover the damages inflicted, and whether the remedy at law is adequate to redress the wrong. If the remedy at law is for anv reason inadequate, resort may be had, as in other cases, to a court of equity. In the case of Spinning Co. v. Riley, L. R. 6 Eq. 551, 558, Vice Chancellor Malins held that an injunction was a proper remedy to prevent the officers of a trades union from using placards and advertisements to dissuade laborers from hiring themselves to the spinning company pending a dispute between the latter company and the trades union as to wages. The court said:

“That every man is at liberty to induce others, in the words of the act of parliament, ‘by persuasion or otherwise,’ to enter into a combination to keep ap the price of wages, or the like: but directly he enters into a combination which has as its object intimidation or violence, or interfering with the perfect freedom of action of another man, it then becomes an offense, not only at common law, but also an offense punishable by the express enactment of the act 6 Geo. IV., e. 129. It is clear, therefore, that the p>rinting and publishing of these placards ahd advertisements by the defendants, admittedly for the purpose of intimidating workmen from entering into the service of the plaintiffs, are unlawful acts, punishable by imprisonment, under Id., c. 129, and a crime at common law.”

In Temperton v. Russell [1893] 1 Q. B. 715, tlie facts appear to have been that a committee representing certain trades unions, for the purpose of enforcing obedience to certain rules that had been adopted by the unions, notified the plaintiff not to supply building materials to a certain firm. He having declined to comply with such request, the committee thereupon Induced certain third parties not to enter into further contracts with the plaintiff; such third parties being so induced by threats or representations that the unions would cause their laborers to be withdrawn from their employ in case such further contracts were made. It was held that the plaintiff had a right of action against the members of the committee for maliciously conspiring to injure him by preventing persons •from having dealings with him. In delivering the judgment of the court the master of the rolls (Lord Esher) quoted with approval a statement of the law winch is found in Bowen v. Hall, 6 Q. B. Div. 333, to the effect that where it appears that a defendant has, by persuasion, induced a third party to break his contract with the plaintiff, either for the purpose of injuring the plaintiff, or for the purpose of reaping a personal advantage at the' expense of the plaintiff, the act is wrongful and malicious, and therefore actionable. In the case of State v. Stewart, 59 Vt. 273, 9 Atl. 559, it was held that a combination entered into for the purpose of preventing or deterring a corporation from taking into its service certain persons whom it desired to employ was an unlawful combination or conspiracy at common law. The court said:

“The principle upon which the cases, English and American, proceed, is that every man has the right to employ his talents, industry, and capital as he pleases, free from the dictation of others; and, if two or more persons combine to coerce his choice in this behalf, it is a criminal conspiracy. The labor and skill of the workmen, he it of high or low degree, the plant of the manufacturer, the equipment of the farmer, the investments of commerce, are all, in equal sense, property. If men, by overt acts of violence, destroy either, they are guilty of crime. The anathemas of a secret organization of men appointed for the purpose of controlling the industry of others by a species of Intimidation that work upon the mind, rather than the body, are quite as dangerous, and generally altogether more effective, than acts of actual violence. And, while such conspiracies may give to the individual directly affected by them a private right of action for damages, they at the same time lay the basis for an indictment, on the ground that the state itself is directly concerned in the promotion of all legitimate .industries and the development of all its resources, and owes the duty of protection to its citizens engaged in the exercise of their callings.”

In Barr v. Trades Council (N. J. Ch.) 80 Atl. 881, it appeared that a publisher of a newspaper had determined to use plate matter in making up his paper, whereupon the members of a local typographical union, conceiving their interests to be prejudiced by such action, entered into a combination to compel him to desist from the use of such plate matter. The object of the combination was to be accomplished by the typographical union by a formal call upon all labor organizations with which it was affiliated, and upon all other persons who were in sympathy with it, to boycott the paper, by refusing to buy it or advertise in the same. It was held, in substance, that a person’s business is property, which is entitled under the law to protection from unlawful interference, and that the combination in question was illegal, because it contemplated a wrongful interference with the plaintiff’s freedom of action in the management; of bis own affairs. Decisions embodying substantially the same views have been made by many other courts. Hilton v. Eckersley, 6 El. & Bl. 47, 74; Steamship Co. v. McKenna, 30 Fed. 48; Casey v. Typographical Union, 45 Fed. 135; Thomas v. Railway Co., 62 Fed. 803, 818; Arthur v. Oakes, 11 C. C. A. 209; 63 Fed. 310, 321, 322. See, also, Carew v. Rutherford, 106 Mass. 1; Walker v. Cronin, 107 Mass. 555; State v. Glidden, 55 Conn. 46, 8 Atl. 890; Vegelahn v. Guntner (Mass.) 44 N. E. 1077. The cases which seem to be chiefly relied upon as supporting the contention that the combination complained of in the case at bar was lawful, and that the action proposed to be taken in pursuance thereof ought not to be enjoined, are the following: Mogul S. S. Co. v. McGregor, 23 Q. B. Div. 598; Id. [1892] App. Cas. 25; Continental Ins. Co. v. Board of Fire Underwriters of the Pacific, 67 Fed. 310; and Bohn Mfg. Co. v. Hollis, 54 Minn. 223, 55 N. W. 1119. In the first of these cases the facts were that the owners of certain steamships, for the purpose of securing all the freight which was shipped at certain ports, and doing a profitable business, had formed an association, and issued a circular to shippers at said ports, agreeing to allow them a certain rebate on freight bills, provided they gave their patronage exclusively to ships belonging to members of the association. The association also prohibited its soliciting agents from act ing as agents for other competing lines. A suit having been brought against the members of the association, by a competing shipowner, to recover damages which had been sustained in consequence of the formation and action of the association, it was held that the acts complained of were lawful, the same having been done simply for the purpose of enabling the members of the association to hold and extend their trade; in other words, that the acts complained of amounted to no more than lawful competition in trade.’ Continental Ins. Co. v. Board of Fire Underwriters of the Pacific, was a case of the same character as the one last considered, and involved an application of the same doctrine. It was held, in substance, that an association of fire underwriters which had been formed under an agreement that provided, among other things, for the regulation of premium rates, the prevention of rebates, compensation of agents, and nonintercourse with companies that were not members of the association, was not an illegal conspiracy, and that the accomplishment of its purpose by lawful means would not be enjoined at the suit of a competing insurance company which was not a member of the association. In the case of Bohn Mfg. Co. v. Hollis, it appeared that a large number of retail lumber dealers had formed a voluntary association, by which they mutually agreed that they would not deal with any manufacturer or wholesale dealer who should sell lumber directly to consumers, not dealers, at any point where a member of the association was carrying on a wholesale lumber business, and had.provided in their by-laws that, whenever any wholesale dealer or manufacturer made any such sale, the secretary of the association should notify all members of the fact. The plaintiff having made such a sale, and the secretary being on the point of sending a notice of the fact to members of the association, as provided by the by-laws, it was held that the sending of such a notice was not actionable, and that an injunction to restrain the sending of such notice ought not to issue. The decision to this effect was based on the ground that the members of the association might lawfully agree with each other to withdraw their patronage, collectively, for the reasons specified in the agreement, because the members, individually, had the right to determine from whom they would make purchases, and to withdraw their patronage at any time, and for any reason which they deemed adequate. We are not able to concede, however, that it is always the case that what one person may do without rendering himself liable to an action many persons may enter into a combination to do. It has been held in several well-considered cases that the law will sometimes take cognizance of acts done by a combination which would not give rise to a cause of action if committed by a single individual, since there is a power in numbers, when acting in concert, to inflict injury, which does not reside in persons acting separately. Steamship Co. v. Mc-Gregor [1892] App. Cas. 24, 25; Id., 23 Q. B. Div. 598, 616; Arthur v. Oakes, 11 C. C. A. 209, 63 Fed. 310, 321; State v. Glidden, 55 Conn. 46, 8 Atl. 890. But if we concede that the reasoning employed in Manufacturing Co. v. Hollis was sound, as applied to the facts in that case, yet it by no means follows (and that fact was recognized in the decision) that the members of the association would have had the power to combine for the purpose of compelling other persons, not members of the association, to withhold their patronage from a wholesale dealer who failed to conduct his business in the mode prescribed by the association.

We think it is entirely clear, upon the authorities, that the conduct of which the defendants below were accused cannot be justified on the ground that the acts contemplated were legitimate and lawful means to prevent a possible future decline in wages, and to secure employment for a greater number of coopers. >,'o decrease in the rate of wages had been threatened by the Oxley Stave Company, and, with one exception, the; members of the combination were not in the employ of the plaintiff company. The members of the combination undertook to prescribe the manner in which the plaintiff company should manufacture barrels and casks, and to enforce obedience to its orders by a species of intimidation which is no less harmful than actual violence, and which usually ends in violence. The combination amounted, therefore, to a conspiracy to wrongfully deprive the plaintiff of its right to manage its business according to the dictates of its own judgment. Aside from the foregoing considerations, the fact cannot be overlooked that another object of the conspiracy was to deprive the public at large of (lie benefits to be derived from a labor-saving machine which seems to have been one of great utility. If a combination to that end is pronounced lawful, it follows, of course, that combinations may be organized for the purpose of preventing the use of harvesters, threshers, steam looms, and printing presses, typesetting machines, sewing machines, and a thousand other inventions which have added immeasurably to the productive power of human labor, and the comfort and welfare of mankind. It results from these views that the injunction was properly awarded, and the order appealed from is accordingly affirmed.