Swift & Co. v. United States: Background
The case of Swift & Co. v. United States was decided in 1904 by the United States Supreme Court.
Swift & Co. v. United States started with the development of a “meat trust” in Chicago. This trust brought together major dealers of meet in the city to agree not to bid against each other to better control the price of meat. Additionally, the trust put pressure on the railroad industry to charge lower rates. In response to the formation of the trust, the Federal Government of the United States labeled the trust as an illegal economic monopoly.
Swift & Co. v. United States: The question
The question in Swift & Co. v. United States revolves around whether the Congress of the United States of America possesses the authority to regulate the meat trust under the Sherman Anti-Trust Act.
The Sherman Antitrust Act is a landmark federal law that was passed by Congress in 1890. The Act prohibits certain business activities that reduce overall competition in the marketplace. The act requires the United States Federal government to investigate and pursue companies, trusts and organization suspected of violating this law. The Sherman Antitrust Act was the first federal statute to limit monopolies and cartels.
Swift & Co. v. United States: The Decision
In a unanimous decision, the court in Swift & Co. v. United States held that congressional authority under the Commerce Clause justified the regulations imposed on the meat trust. The court in Swift & Co. v. United States held that the effect of the formation was not accidental but rather a direct attempt to monopolize the market.
The court in Swift & Co. v. United States drew a distinction between manufacturing monopolies, which it viewed as having only an indirect effect on commerce and sales monopolies, which the court viewed as having a direct and intended effect on interstate commerce.
The decision in Swift & Co. v. United States ultimately halted price fixing by the Swift Company. The case of Swift & Co. v. United States established a stream of commerce argument that permits Congress to regulate dealing that fall into either category. IN this particular case, it permitted Congress to regulate the Chicago slaughterhouse or meat industry, even though such markets supposedly only dealt with intrastate matters.