Loewe v. Lawlor - "lawful Combination" Or Restraint Of Trade?

Danbury Hatters was not happy about this threat to its business. The company owner, D. E. Loewe, brought suit against individual members of the United Hatters, including the union's business agent, Martin Lawlor. Loewe referred to the provisions of the Sherman Anti-Trust Act cited above, which he claimed entitled him to "three fold" the amount he had lost through the boycott, plus court costs for the suit itself. Altogether, Loewe wanted $80,000.

Loewe's argument was straightforward: by combining with unions across the country to boycott his goods, United Hatters was unlawfully restraining his trade. From Loewe's point of view, the working men and women that were refusing to buy his hats were no different from a huge corporation that tried to drive a little company out of business.

Of course, the union saw it differently. They pointed out that the Sherman Anti-Trust Act was a federal law, which applied only to trade between states. But, they said, the United Hatters local that was trying to organize Danbury Hatters existed only in Connecticut, within the boundaries of a single state. Only thirteen years before, in an 1895 case called United States v. E. C. Knight, the Court had ruled that the local activities of a nationwide Sugar Trust did not come under the provisions of the Anti-Trust Act. The union probably expected that its own local activities would find similar toleration. After all, the union's lawyer pointed out, the United Hatters was not an illegal trust but a "lawful combination."