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74 Iowa L. Rev. 1151 (1988-1989)
The Labor Exemption, 1908-1914

handle is hein.journals/ilr74 and id is 1165 raw text is: The Labor Exemption, 1908-19141
Daniel R. Ernst*
Historians of organized labor's encounter with the Sherman Act often
write in a bitterly ironic tone. Through a triumph of sharp lawyering, so the
story goes, a statute passed with the support of organized labor to punish
the robber barons was turned into a scourge of trade unionism.' Although
in the 1890s lower federal courts upheld the prosecution of transportation
workers several times under the statute, these historians single out Loewe v.
Lawlor2 (the Danbury Hatters case) as the climactic moment in their tale.
In that case, a unanimous Supreme Court for the first time ruled that
federal antitrust laws applied to organized labor.3
The decision reinvigorated the sporadic campaign of the American
Federation of Labor (AFL) for legislation that would exempt organized
labor from the scope of the Sherman Act.4 Samuel Gompers, president of
the AFL, was convinced that Loewe would jeopardize all attempts by
organized labor to establish collective bargaining throughout an industry.
Gompers had good reason for his fears, for in several competitive industries
the parties to these trade agreements had regulated successfully prices and
production levels, much as the managers of dominant firms in oligopolistic
industries had succeeded in administering their own product markets. Such
agreements, of course, made the application of the antitrust laws to
organized labor anything but ironic; requiring organized labor's compli-
ance merely ensured (as a judge wrote much later) that organized labor
would not join hands with organized business to drive marginal operators
out of existence.5
Opposed to the AFL in court and in Congress was the American
Anti-Boycott Association (AABA), a legal defense fund sustained by the
contributions of proprietors of small firms who faced many of the nation's
strongest unions. Led by the Connecticut lawyer Daniel Davenport, the
AABA sponsored many precedent setting cases against organized labor,
including Loewe and an injunction suit against Gompers himself, Gompers v.
Buck's Stove & Range Co.6 During his congressional lobbying, Davenport
worked in cooperation with James A. Emery of the National Association of
Manufacturers (NAM). Together, these pioneer lobbyists successfully
t 01989 Daniel R. Ernst.
*Associate Professor of Law, Georgetown University Law Center.
1. For a recent example, see D. BENHAN, THE PRACICE OF SOLIDART: A  IcAN HAT
2. 208 U.S. 274 (1908).
3. See id. For two sharply conflicting accounts of organized labor and the Sherman Act
between 1890 and 1908, see E. BERMAN, LABOR AND THE SHERIAN ACr 3-87 (1930); A. MASON,
4. Sherman Act, 15 U.S.C. §§ 1-7 (1982).
5. United Mine Workers v. Pennington, 381 U.S. 657, 674 (1965) (Douglas, J., con-
6. 221 U.S. 418 (1911).


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