This Day in Labor History: February 3, 1908
By 
On February 3, 1908, The Supreme Court decided the case of Loewe v. Lawlor. In it, it declared that unions violated the Sherman Anti-Trust Act by calling for a secondary boycott in solidarity with a strike. As was the case through almost its whole history, the Court came down decisively on the side of corporate America and sought to crush anything that unions did that works. Also, this was another case in which the Court created meanings for the law out of whole cloth, while not applying the law in the actual way it was intended, which was a speciality of the Gilded Age Court.
In 1901, a Connecticut fur hat manufacturing firm called D.E. Loewe & Company declared itself an open shop, which meant that it would not tolerate unions mandating the workers be union members in order to work there. This was a typical move of the period’s capitalists. They would often say they had no problem with workers joining unions, but would absolutely not tolerate the union doing anything at all that would allow it some sense of power, such as collective bargaining or ensuring that employees were union members. After all, hiring was the right of the employer!
Well, Danbury, Connecticut was a fur town and a union town. So Loewe’s move was a huge act of aggression and the United Hatters of North America (UHU) called a boycott. They had almost the entire industry unionized. The American Federation of Labor gladly joined the boycott. This was the kind of reasonable unionism the AFL specialized in. The UHU wasn’t radical and it wasn’t asking for government intervention. This was what unions were supposed to do–act collectively based on manly principles of self-control and collective economic interests. No one was coercing anyone. Workers were simply making the choice not to work until the company came to a reasonable relationship with the UHU.
Well, Loewe really hated unions and he saw this as a chance to bust the entire movement. So he sued. The named defendant is Martin Lawlor, business agent for the UHU and a guy who would stay actively involved in the labor movement until just before his death in 1959. What changes he saw! Anyway, in 1890, Congress had passed the Sherman Anti-Trust Act. Although American politics at this time were overwhelming pro-business, there was enough concerns about monopolies that occasionally a law like this could get through. The Sherman Act prohibited anticompetitive agreements and monopolies. But here’s the thing–laws only matter to the extent that the courts are willing to enforce them. That’s what the courts were doing with the 14th Amendment at this time, ruling in Plessy v. Ferguson that segregation was OK while other cases at the same time were granting corporations personhood rights that are in no way, shape, or form in the text. That’s one of the thing Democrats have to get through their skulls today too–laws on the paper are almost meaningless, it’s power in the courts that matter. Sure, Donald Trump is tearing up the Constitution. So long as the courts are OK with that, there’s zero chance of doing something about it.
Well, it was the same with the courts and the Sherman Act. Sure, that was on the books. But were courts really going to use it to enforce the law against corporate America? It really depended. The Roosevelt administration would use it against some monopolies, but that was really the first time it had been used that way and that required the political backing of a powerful president. But almost immediately, courts found it useful against a type of organization most judges hated with a white-hot passion: labor unions. That had started as early as 1893, with United States v. Workingmen’s Amalgamated Council of New Orleans, which created the principle that the Sherman Act could apply to labor unions. After all, combinations in restraint of trade, right?
So Loewe sued the unions, saying that the secondary boycott was a violation of the Sherman Act. And the hackish pro-corporate courts of the time were happy to go along with this argument. The United States Circuit Court for the District of Connecticut completely rejected this argument and dismissed the case. But Loewe appealed to the Second Circuit and that court sent it right on up to the Supremes.
To say the least, the Fuller Court was very happy to take this case on. No one hated unions like Melville Fuller and his buddies. So they unanimously ruled in Loewe’s favor. They had no interest in holding corporations accountable for monopolies, but using the law to bust unions? Gold! And the fact that this was unanimous, I mean, it’s worth thinking for a minute of how much the American legal and political system were rigged against organized labor at this time. This is even more important as this has increasingly happened today, a moment where unions lose more and more at the Supreme Court every year and, as of writing, the nation’s biggest companies are seeking to overturn the National Labor Relations Act entirely. Unions just stood no chance. If unions did something successful, the courts would neutralize it.
In his opinion, Fuller wrote, “In our opinion, the combination described in the declaration is a combination ‘in restraint of trade or commerce among the several States,’ in the sense in which those words are used in the act, and the action can be maintained accordingly.” Oh OK, sure.
The aftermath was of course terrible for labor. Under the Sherman Act, fines are tripled, so the civil case against the union saw the judge order the jury to find for Loewe. The UHU was fined $74,000, but with the Sherman Act tripling, that went to $222,000. The union did appeal and initially own, but then another court again found for Loewe. In fact, the UHU tried again at the Court in what was now Lawlor v. Loewe, but to no different result. Finally in 1917, the UHU paid up, but the AFL managed to hold a contribution drive among union members around the country and that covered almost all the money.
The Clayton Act in 1914 more explicitly exempted unions from antitrust law. But the Court didn’t care. In 1921’s Duplex Printing Company v. Deering, the Court ruled that Clayton Act language didn’t protect the secondary boycott due to reasons such as the justices hating unions. The Norris-LaGuardia Act in 1932 finally and very specifically exempted unions from antitrust actions, but the employers still tried here and would probably have won in U.S. v. Hutcheson in 1941 if FDR hadn’t transformed the Court. But Taft-Hartley in 1947 then banned secondary boycotts anyway and even when Democrats have had large majorities in Congress, have never changed the law since.
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