American Column & Lumber Co. v. United States

Facts

In December 1918, the American Hardwood Manufacturers’ Association was formed through the consolidation of two similar associations. The Association implemented an “Open Competition Plan” in which 365 of its 400 members participated, representing approximately one-third of the total hardwood lumber production in the United States. Under this plan, members submitted detailed daily reports on sales, shipments, and prices; monthly reports on production and inventory; and price lists. These reports were compiled by F.R. Gadd, the “Manager of Statistics,” who distributed summaries to all members along with market analyses and forecasts. The plan also included frequent regional meetings (49 meetings in about a year) where members discussed market conditions. Before these meetings, members completed questionnaires about their production plans and market outlook. Throughout 1919, Gadd’s market letters and meeting discussions repeatedly warned against “overproduction” and encouraged members to maintain “stout heart and stiff backbone” in keeping prices high. Members later testified that the plan enabled them to increase their prices substantially, with some specifically stating they raised prices after learning competitors were charging more. During 1919, hardwood lumber prices increased dramatically, with some varieties rising by as much as 200-300%.