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Argument for Respondent.

301 U.S.

The legislative history of the National Labor Relations Act and its substantive provisions are sufficient to demonstrate that the Act, although disguised as a regulation of interstate commerce, is, in actuality, a regulation of labor. The terms of the statute apply to almost every employer and every employee (§ 2), although the jurisdiction of the petitioner to enforce it is somewhat circumscribed.

The provisions of the statute, if carefully analyzed, will indicate that Congress is primarily concerned with the protection and establishment of labor organizations. The provisions condemning plant unions and sanctioning "closed shop" agreements, bear no reasonable relation to interstate commerce. Similarly, the express preservation of the right to strike indicates that Congress was not interested in preventing interruptions to the movement of commerce. The interference with the employer's discretion to hire and fire is another reason for believing that efficiency in the shipment of products in interstate commerce has not been the object of the statute.

Congress has endeavored to save the statute from the taint of invalidity by confining its enforcement to transactions "affecting commerce," which the Act defines as transactions which burden commerce or lead or tend to lead to a labor dispute which burdens commerce. § 2. Despite this limitation on the enforcement of the Act, the substantive provisions make no such exception and are, in fact, broad enough to cover almost every employment relation.

The petitioner has followed the same involved line of reasoning in endeavoring to "find" that the respondent's operations "affect commerce." Like Congress, it has found itself faced with the task of piling premise upon premise and hypothesis upon hypothesis to reach the conclusion that the discharge of a few production em

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Argument for Respondent.

ployees at the respondent's plant has a vital bearing upon the movement of interstate commerce. We submit that the ultimate fact remains that Congress has enacted a labor law, and not a regulation of commerce, and it does not help to sustain the pretext that there may be an indirect connection between the two. Carter v. Carter Coal Co., 298 U. S. 238.

The National Labor Relations Act can have no application to the respondent's relations with its production employees.

Although the respondent purchases raw materials, which have a point of origin in other States, and ships a large portion of its finished products across state lines, its production activities, including its employment relations, are not thereby subjected to the jurisdiction of Congress. Howard v. Illinois Central R. Co., 207 U. S. 463. There is no logical or legal connection between the respondent's limited participation in interstate commerce and the union affiliations of its production employees. Adair v. United States, 208 U. S. 161; Hammer v. Dagenhart, 247 U. S. 251; Railroad Retirement Board v. Alton R. Co., 295 U. S. 330.

The principle which impeaches the validity of the National Labor Relations Act, viz., that federal power over interstate commerce must be confined to bona fide regulation of the movements of commerce, likewise prevents the application of the statute in the present case. An unbroken line of decisions under the commerce clause has established that manufacturing and production activities are not in or a part of interstate commerce, even though they may be preceded or followed by the movement of materials between States. Kidd v. Pearson, 128 U. S. 1; Arkadelphia Milling Co. v. St. Louis Southwestern Ry. Co., 249 U. S. 134; Oliver Iron Co. v. Lord, 262 U. S. 172; Utah Light & Power Co. v. Pfost, 286 U. S. 165; Chas

Argument for Respondent.

301 U.S.

saniol v. Greenwood, 291 U. S. 584; Industrial Association v. United States, 268 U. S. 64. Although most of the decisions have dealt with the police or taxing powers of the States, they are based upon the fundamental principle that manufacturing activities are subject to the exclusive jursdiction of the separate States. Bacon v. Illinois, 227 U. S. 504; Susquehanna Coal Co. v. South Amboy, 228 U. S. 665; Packer Corp. v. Utah, 285 U. S. 105; Nashville, C. & St. L. Ry. v. Wallace, 288 U. S. 249; Edelman v. Boeing Air Transport, 289 U. S. 249; Minnesota v. Blasius, 290 U. S. 1; Federal Compress Co. v. McLean, 291 U. S. 17; Cornell v. Coyne, 192 U. S. 418; Crescent Cotton Oil Co. v. Mississippi, 251 U. S. 129; Heisler v. Thomas Colliery Co., 260 U. S. 245; Oliver Iron Co. v. Lord, 262 U. S. 172; Champlin Refining Co. v. Corporation Commission, 286 U. S. 210; United Mine Workers v. Coronado Coal Co., 259 U. S. 344; United Leather Workers v. Herkert & Meisel Trunk Co., 265 U. S. 457; Delaware, L. & W. R. Co. v. Yurkonis, 238 U. S. 439.

The distinction between the local manufacturing activities of a business and its subsequent or precedent participation in interstate commerce has been maintained in the field of labor relations. Hammer v. Dagenhart, 247 U. S. 251; Industrial Accident Comm'n v. Davis, 259 U. S. 182. Even though an employee may be employed in directly assisting the movement of products in interstate commerce, his relationship to his employer is a status existing wholly within the State, whose incidents, such as wages, hours of labor and the like, are purely domestic in character. Carter v. Carter Coal Co., 298 U. S. 238.

Congressional regulation of the labor relations of interstate carriers furnishes no precedent for the present Act. Because interstate carriers are instrumentalities of the movement of commerce, and because they are public

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Argument for Respondent.

utilities, Congress has subjected them to an exhaustive scheme of regulation, of which the labor legislation is merely an incident. As a result, the decision in Texas & N. O. R. Co. v. Railway Clerks, 281 U. S. 548, is not controlling.

Decisions such as Stafford v. Wallace, 258 U. S. 495, and Chicago Board of Trade v. Olsen, 262 U. S. 1, which sustain federal regulation of stockyards and grain exchanges, have no application to the present case. Grain exchanges and stockyards are instrumentalities of interstate commerce in much the same sense as the actual carriers of interstate commerce. They are focal points through which the stream of commerce in grains and cattle sweeps on its way from producer to the ultimate consumer. The activities which were regulated in both cases were activities in the stream of commerce and exerted a direct effect upon its flow. Neither case sanctions the extension of the doctrine to production activities which may indirectly affect the stream of commerce. Carter v. Carter Coal Co., 298 U. S. 238. Cf. Swift & Co. v. United States, 196 U. S. 376; Hill v. Wallace, 259 U. S. 44; Tagg Bros. & Moorhead v. United States, 280 U. S. 420: Tyson & Bro. v. Banton, 273 U. S. 418.

The petitioner relies upon decisions which have upheld the application of the Anti-Trust Laws to industrial conspiracies, such as Coronado Coal Co. v. United Mine Workers, 268 U. S. 295. These were cases involving conspiracies to restrain interstate commerce by means of local combinations. The element of an intentional interference with the movement of interstate commerce was essential in these cases, not only because an intent to restrain commerce was a part of the proscribed offense, but also because the existence of such an intent made the effect on interstate commerce necessarily direct. This is shown by a comparison of the first Coronado case, 259

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Argument for Respondent.

301 U.S.

U. S. 344, where there was no intent, with the second Coronado case, 268 U. S. 295, where there was both direct and inferential evidence of intent. Cf. United Leather Workers v. Herkert & Meisel Trunk Co., 265 U. S. 457.

The petitioner's efforts to show an intended restraint in the present case are futile. Even if a strike should occur at the respondent's plant, the respondent could not be held responsible for the voluntary intervening act of outside agencies. The suggestion that the respondent might be charged with an implied intent to destroy interstate trade, if a labor dispute should occur, is obviously unsound.

The conspiracy cases, such as United Mine Workers v. Coronado Coal Co., 259 U. S. 344, and Local 167 v. United States, 291 U. S. 293, although primarily concerned with the application of the Anti-Trust Laws, prove the fallacy of the petitioner's argument, because they establish that Congress cannot regulate local transactions or relations unless they exert a direct effect on interstate commerce. The definition of "affecting commerce" in the National Labor Relations Act is a confession of the indirectness of the connection between the respondent's labor relations and the movement of interstate commerce. See Schechter Corp. v. United States, 295 U. S. 495; Industrial Association v. United States, 268 U. S. 64. The petitioner calls attention to the fact that strikes may and frequently do produce an inhibitory effect on the movement of interstate trade to and from the affected

This is the fundamental error in the petitioner's argument, in that it assumes that it need only establish the connection between strikes and the stoppage of commerce. There has been no strike or labor dispute in the present case. In actuality, the petitioner means that the respondent's discharge of ten employees might have led to dissatisfaction, which might have led to a labor dis

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