Laing, Harrar & Chamberlin, Inc

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IN THE MATTER OF LAING, HARRAR & CHAMBERLIN, INC., A. J. SANBORN SONS, INC., HARRY FAIN AND ALFRED PICERNO COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. I! OF AN ACT OF CONGRESS Approved SEPT. 26, 1914 Docket 3725. Complaint, Feb. 28, 1939-Decision, Nov. 2, 1939 \Vhere a corporation engaged in sale and distribution of shoe findings, leather, and supplies for shoe manufacturers, shoe stores, and shoe repair shops, to wholesale dealers, including corporation and two individuals engaged, in competition with one another and others prior to acts below set forth, in distribution and sale at wlwlesale of such products in trade area iu and around the city of Providence--- (a) Entered into an understanding and agreement whereby said distributor corporation nndertook not to sell and distril.mte Its products to third individual, likewise engaged as wholesaler of such articles in said city, lucking consent of corporate and indh·idual wllolesulers first referred to; and Where said corporate and individual wholesalers first referred to- (b) Undertook, as part of understanding and agreement aforesaid, not to purchase uny of the articles sold and distributed by corporate distributor first referred to in event of its violating its agreement and selling to said third individual contrary to the wishes of said corporate wholesaler and other two wholesaler individuals;

\With result that said agreeing corporation discontinued sale of its articles to individual in question, competitor of said corporate wholesaler and whole- Imler lndividuals1 and purchaser, prior thereto, from such discontinuing corporation of substantial quantities of its articles: Held, That such acts and practices, under the circumstances set forth, were all to the prejudice of competitors and the public, and had a dangerous tendency to and did binder and prevent competition In sale of shoe findings, leather, and supplies for shoe stores and shoe repair shops, and unreasonably restrained commerce therein aud constituted unfair methods of competition.

llf r. Daniel J. JJ urphy for the Commission. llfr. Walter W. Hess, of Philadt>1phia, Pa., for Laing, Harrar & Chamberlin, Inc.

Remington, Thomas & Levy, of Providence, R. I., for A. J. Sanborn Sons, Inc., Harry Fain and Alfred Picerno. Co:uplaint Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said act, the Federal Trade Commission having reason to believe that Laing, Harrar & LAING, HARRAR & CHAMBERLIN, INC., ET AL, 1245 1244 Complaint Chamberlin, Inc., A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno, hereinafter referred to as respondents, have violated the provisions of the said act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent Laing, Harrar & Chamberlin, Inc., is a corporation organized under the laws of the State of Delaware and having its office and principal place of business at 43 North Third Street in the city of Philadelphia, Commonwealth of Pennsylvania. Respondent A. J. Sanborn Sons, Inc., is a corporation organized under the laws of the State of Rhode Island and having its office nnd principal place of business at 20 Exchange Place in the city of Providence, State of Rhode Island.

Respondent Harry Fain is an individual doing business under the name and style of Fain Leather Co., and having an office and principal place of business at 36 Broad Street in the city of Providence, State of Rhode Island.

Respondent Alfred Picerno is an individual doing business under the name and style of Cipolla & Picerno, and having an office and principal place of business nt 7 Vinton Street in the city of Providence, State of Rhode Island.

PAR. 2. Respondent Laing, Harrar & Chamberlin, Inc., is now and has been for more than 2 years last past engaged in the business of selling and distributing shoe findings, leather, and supplies for shoe manufacturers, shoe stores, and shoe repair shops, to wholesale dealers thereof.

Respondents, A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno are, and have been for more than 2 years last past, engaged in the business of distributing and selling, as wholesale dealers, shoe :findings, leather, and supplies for shoe stores and shoe repair shops, in the trade area in and around Providence, R. I. PAR. 3. In the course and conduct of their respective businesses, respondents, A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno purchased, and are still purchasing, shoe findings, leather, and other supplies for shoe stores and shoe repair shops, from respondent Laing, Harrar L~ Chamberlin, Inc., and when said purcha.<;es are made, and as a part thereof, said responcll:'nt Laing, Ilarrar & Chamberlin, Inc. has shippl:'cl or caused. to be shipped, and does ship or causes to be shipped, said articles from its place of busi1wss located in the State of Pennsylvania to the places of business of respondents, A. J. Sanborn Sons, Inc., Harry Fain, and Alfrf'd 213703"'-40-YOL, 20-81 1246 FEDERAL TRADE COl\U.IISSION DECISIONS Complaint 29F.T.C.

Picerno located in the State of Rhode Island. All of the respondents in the aforementioned manner maintained, and· still do maintain, a course of trade in said articles in commerce between and among the several States of the United States.

PAR. 4. Prior to 1937, respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno were in active and substantial competition with each other and with other wholesale dealers in shoe findings, leather, and other supplies for shoe stores and shoe repair shops in the city of Providence, R. I., in reselling, and seeking to resell, the articles which were purchased from respondent Laing, Harrar & Chamberlin, Inc., in the manner aforementioned, to the shoe stores and shoe repair shops in the trade area in and around Providence, R. I.; and, but for the respondents entering into and carrying out the understanding, agreement, combination, and conspiracy hereinafter set out, said active and substantial competition would have continued to the present.

PAn. 5. During 1937 respondents entered into, and thereafter carried out, an understanding, agreement, combination, and conspiracy for the purpose, and with the effect, of unlawfully restricting, restraining, monopolizing, repressing, and eliminating competition in resale between wholesale dealers in Providence, R I., of shoe findings, leather, and other supplies for shoe stores and shoe repair shops, to shoe stores and shoe repair shops in the trade area in and around I>rovidence, R.I.

PAR. 6. Pursuant to the understanding, agreement, combination, and conspiracy entered into by, between, and among respondents, and in furtherance thereof, said respondents have done and performed, and still do and perform the following acts and things: 1. Agreed that Laing, Harrar & Chamberlin, Inc. should refuse to ~ell, and it has refused to sell, its articles to any wholesale dealer in ~hoe findings, leather, and other supplies for shoe stores and shoe repair shops, in Providence, R. I., unless and until respondents, A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno consented that such sales could be made.

2. Agreed that respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno should designate, and they have so designated, other wholesale dealers in the articles sold and distributed by respondent Laing, Harrar & Chamberlin, Inc., located in Providence, R. I., to whom respondent Laing, Harrar & Chamberlin, Inc. should not sell its said articles.

3. In order to abet and effectuate the agreement by respondent Laing, Harrar & Chamberlin, Inc. that it would refuse to sell its articles to those wholesale dealers in shoe findings, leather, and other LAING, HARRAR & CHAMBERLIN, INC., ET AL, 1247 1244 Complaint :mpplies for shoe stores and shoe repair shops in Providence, R. I., thus designated by respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno, said respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno have agreed not to purchase any of the articles sold and distributed by respondent Laing, Harrar & Chamberlin, Inc. if it violated its said agreement not to sell these designated wholesale dealers.

PAR. 7. Each of said respondents at the time mentioned herein, acted in concert with one or more of the other respondents, in doing and performing the acts and things herein alleged in furtherance of the understanding, agreement, combination, and conspiracy hereinbefore set out.

PAR. 8. The understanding, agreement, combination, and conspiracy hereinbefore set out, and the acts and things done thereunder and pursuant thereto, have had, and do have, the effect of unlawfully restricting and restraining their movement in commerce between and among the several States of the United States of the articles sold and distributed by respondent Laing, Harrar & Chamberlin; Inc.; of unlawfully restricting and restraining the resale to shoe stores and shoe repair shops in the trade area in and around Providence, R. I., by wholesale dealers in shoe findings, leather and other supplies for shoe stores and shoe repair shops, of such articles purchased by said wholesale dealers from respondent Laing, Harrar & Chamberlin, Inc., in commerce between and among the several States of the United States; of preventing certain designated wholesale dealers in Providence, R. I., from securing the articles sold and distributed by respondent Laing, Harrar & Chamberlin, Inc. in commerce, in the manner aforementioned, to be resold by said dealers to the shoe stores and shoe repair shops in the trade area in and around Providence, R. I., thereby depriving such designated dealers of the means of competing with respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno in the resale of such articles to the shoe stores and shoe repair shops in said area; of substantially enhancing prices to the consuming public of certain articles which the public purchases from the shoe stores and shoe repair shops to which respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno resell the articles which they purchase from respondent Laing, Harrar & Chamberlin, Inc. in commerce between and among the several States of the United States, of maintaining such prices to the consuming public at artificial levels, and otherwise deprivinrr the public of the benefits which would flow from normal competitio~ between and among respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno and these designated wholesale dealers in 1248 FEDERAL TRADE COl\11\IISSION DECISIONS Findings 29F.T.C.

Providence, R. I., in their resale to shoe stores and shoe repair shops of articles sold and distributed by respondent Laing, Harrar & Chamberlin, Inc., in commerce, in the manner as described, with the tendency and capacity of creating for respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno a monopoly in said trade.

Said understanding, agreement, combination, and conspiracy, and the things done thereunder, and in pursuance thereof, as above alleged, constitute unfair methods of competition in commerce within the intent and meaning of the Federal Trade Commission Act. REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on the 28th day of February 1939, issued and served its complaint in this proceeding upon respondents, Laing, Harrar & Chamberlin, Inc., A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno, charging them with the use of unfair methods of competition in commerce in viola.tion of the provisions of said Act. On April 28, 1939, the respondents filed their answers in this proceeding. Thereafter, a stipulation was entered into whereby it was stipulated and agreed that a statement of facts signed and executed by responllents and their counsel, ·walter \V. Hess and Arthur J. Levy, and W. T. Kelley, chief counsel for the Federal Trade Commission, subject to the approval of the Commission, may be be taken as the facts in this proceeding and in lieu of testimony in support of the charges stated in the complaint, or in opposition thereto, and that the said Commission may proceed upon said statement of facts to make its report, stating its findings as to the facts and its conclusion based thereon and enter its order disposing of the proceeding without the presentation of argument or the filing of briefs. Thereafter, this proceeding regularly came on for final hearing before the Commission on said complaint, answers, and stipulation, said stipulation having been approved, accepted, and filed, and the Commission having duly considered the sume aml being now fully advised in the premises, finds that this proceeding is in the interest of the public and makes its finuings as to the facts and its conclusion drawn therefrom.

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent Laing, Harrar & Chamberlin, Inc., is a corporation organized under the laws of the State of Delaware and having its office and principal place of business at 43 North Third Street in the city of Philadelphia, Commonwealth of Pennsylvania. LAING, HARRAR & CHAMBERLIN, INC., ET AL. 1249 1244 Findings Respondent A. J. Sanborn Sons, Inc., is a corporation organized under the laws of the State of Rhode Island and having its office and principal place of business at 20 Exchange Place in the city of Providence, State of Rhode Island.

Respondent Harry Fain is an individual doing business under the name and style of Fain Leather Co., and having an office and principal place of business at 36 llroad Street in the city of Providence, State of Rhode Island.

Respondent Alfred Picerno is an individual :formerly doing business under the name and style o:f Cipolla & Picerno and formerly • having an office and principal place of business at 7 Vinton Street in the city of Providence, State of Rhode Island, which business was discontinued on or about June 15, 1938.

PAR. 2. Respondent Laing, Harrar & Chamberlin, Inc., is now and has been for more than 2 years last past engaged in the business of selling and distributing shoe findings, leather, and supplies :for shoe manufacturers, shoe stores, and shoe repair shops, to wholesale dealers thereof.

Respondents A. J. Sanborn Sons, Inc. and Harry Fain are and have been for more than 3 years last past and respondent Alfred Picerno was until about June 15, 1938, and for more than 2 years previous thereto, engaged in the business o:f distributing and selling, as wholesale dealers, shoe findings, leather, and supplies for shoe stores and shoe repair shops, in the trade area in and around Providence, R.I.

PAR. 3. In the course and conduct o:f their respective businesses, respondents A. J. Sanborn Sons, Inc. and Harry Fain purchased and are still purchasing and the respondent Alfred Picerno purchased and until about June 15, 1938, continued to purchase, shoe findings, leather, and other supplies for shoe stores and shoe repair shops, from respondent Laing, Harrar & Chamberlin, Inc., and when such purchases are or were made, and as a part thereof, said respondent Laing, Harrar & Chamberlin, Inc. has shipped or caused to be shipped, and does ship or causes to be shipped, said articles :from its place of business located in the State of Pennsylvania to the places of . business of the respondents A. J. Sanborn Sons, Inc. and Harry Fain, located in the State of Rhode Island and the respondent Alfred Picerno formerly located in the State o:f Rhode Island. All of the respowlents in the aforementioned manner maintained, and except in the case of the respondent AI:fred Picerno, still do maintain, a course o£ trade in said articles in commerce between and among the several States o:f the United States.

Findings 29F.T.C.

PAn. 4. Prior to 1937, respondents A. J. Sanborn Sons, Inc., Harry Fain, and Alfred Picerno were in active and substantial competition with each other and with other wholesale dealers in shoe findings, leather, and other supplies for shoe stores and shoe repair shops in the city of Providence, R. I., in reselling, nnd seeking to resell, the articles which were purchased from respondent Laing, Harrar & Chamberlin, Inc., in the manner aforementioned, to the shoe stores and shoe repair shops in the trade area in and around Providence, R. I.; and, but for the respondents entering into and carrying out the understanding and agreement, hereinafter set out, said active and substantial competition would have continued uninterruptedly to the present, except in the case of the respondent Alfred Picerno who discontinued business as aforesaid.

PAn. 5. During 1937, respondents entered into, and thereafter carried out, an understanding and agreement whereby: 1. Respondent Laing, Harrar & Chamberlin, Inc., agreed not to sell and distribute its articles to Irving Schretter, doing business under the firm and style name of Sadler Leather Co., a wholesale dealer in shoe findings, leather, and other supplies for shoe stores and shoe repair shops, in Providence, R. I., unless and until respondents A. J. Sanborn & Sons, Inc., Harry Fain, and Alfred Picerno consented that such sales could be made. 2. Respondents A. J. Sanborn & Sons, Inc., Harry Fain, and Alfred Picerno agreed not to purchase any of the articles sold and distributed by Laing, Harrar & Chamberlin, Inc., if said Laing, Harrar & Chamberlin, Inc., Violated its agreement and sold to Irving Schretter, doing business under the firm and style name of Sadler Leather Co., contrary to the wishes of said respondents A. J. Sanborn & Sons, Inc., Harry Fain, and Alfred Picerno. As a result of said understanding and agreement being carried out in concert by and between said respondents, respondent Laing, Harrar & Chamberlin, Inc., did, on or about December 3, 1937, to about :May 18, 1938, discontinue the sale of its articles to Irving Schretter, doing business under the firm and style name of Sadler Leather Co., a wholesaler in Providence, a competitor of respondents A. J. Sanborn & Sons, Inc., Harry Fain, and Alfred Picerno. The said Irving Schretter, prior to December 3, 1937, purchased substantinl quantities of articles from respondent Laing, Harrar & Chamberlin, Inc., which were sold and distributed in commerce in the manner- aforementioned.

LAING, HARRAR & CHAMBERLIN, INC., ET AL, 1251 1244 Order CONCLUSION The acts and practices of the respondents as herein set forth are all to the prejudice of the competitors of respondents and of the public; have a dangerous tendency to and have actually hindered and prevented competition in the sale of shoe findings, leather, and supplies for shoe stores and shoe repair shops in commerce, as commerce is defined in the Federal Trade Commission Act; have· unreasonably restrained such commerce in shoe findings, leather, and supplies for shoe stores and shoe repair shops and constitute unfair methods of competition in commerce within the intent and meaning of the Federal Trade Commission Act.

ORDER TO CEASE .AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission, the answers of the respondents, and a stipulation as to the facts entered into between the respondents herein and 1V. T. Kelley, chief counsel for the Commission, which provides, among other things, that without further evidence or other intervening procedure, the Commisison may issue and serve upon the respondents herein findings as to the facts and conclusion based thereon and an order disposing of the proceeding, and the Commission having made its findings as to the facts and conclusion that said respondents have violated the provisions of the Federal Trade Commission Act.

It is ordered, That the respondents, A. J. Sanborn Sons, Inc., its officers, representatives, agents, and employees, Harry Fain and Alfred Picerno, their agents, representatives, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution of shoe findings, leather, and supplies for shoe stores and shoe repair shops· in commerce, as com· merce is defined in the Federal Trade Commission Act, do forthwith cease and desist from entering into or carrying out any agreement, understanding, combination, or conspiracy between and among any two or more of said respondents, or between any one of said respondents and a manufacturer of such products, for the purpose or with the effect of restricting, restraining, or monopolizing, or eliminating competition in, the purchase or sale in said commerce of any of such products, and from doing any of the following acts and things pursuant thereto:

1. Boycotting, or threatening to boycott, or using any other coercive methods or means, to persuade, induce, or compel manufacturers or 1252 FEDERAL TRADE COMl\IISSIO:N DECISIONS Order 29F.T.C.

distributors of such products to refrain from selling any of such products to any wholesale dealer in such products. 2. Interfering, in any manner, with any competitive wholesale dealer's source of supply of such products. It is further ordered, That the respondent, Laing, Harrar & Chamberlin, Inc., its officers, representatives, agents, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution of shoe findings, leather, and supplies for shoe stores and shoe repair shops in commerce, as commerce is defined in the Federal Trade Commission Act, do forthwith cease and desist from entering into any agreement, understanding, combination, or conspiracy for the purpose or with the effect of restricting, restraining, or monopolizing, or eliminating competition in, the purchase or sale of such products in said commerce; or from aiding or abetting the carrying out of any such agreement, understanding, combination, or conspiracy by refusing to sell such products to wholesale dealers engaged in the sale and distribution of such products bE:'cause of inducements offered, or coercive methods used, by competitors of such wholesalers. It is further ordered, That the respondents shall, within 60 days after service upon thell of this order, file with the Commission a report in writing, setting forth in detail the manner and form in which they have complied with this order. CHRISTOPHER CANDY CO. 1253 Syllabus