Full opinion text
OPINION FRANK W. WILSON, District Judge. These two lawsuits involve antitrust actions instituted against the United Mine Workers of America by a number of coal operators from the Southeastern Tennessee coal fields. The lawsuits, like the economic struggle of which they are a part, have been long and hard fought. The issues here involved are basic issues. They involve a basic commodity in the American economy — coal. They involve basic principles of American labor-management relations — the manner in which labor and management may lawfully seek their respective aims and goals. They involve basic principles of American law — the extent to which Federal Antitrust Laws shall regulate the activities of labor unions. The original action, in Docket No. 3667, purported to have been brought as a class action, some 27 individuals, partnerships and corporations joining as plaintiffs. As originally filed, the lawsuit named a number of parties as defendant, including United Mine Workers of America, the Trustees of the United Mine Workers of America Welfare and Retirement Fund, the West Kentucky Coal Company, Inc., Cyrus W. Eaton, the Tennessee Valley Authority, G. O. Wessenouer, manager of power for the T.V.A., and The Louisville and Nashville Railroad Company. Along the way plaintiffs were added and plaintiffs dropped out or were dismissed from the suit so that, at the time of the trial, some 16 individuals, partnerships and corporations remained as parties plaintiff. Also along the way the suit was dismissed as to all defendants other than the United Mine Workers of America. In the course of the trial an additional plaintiff, Walden Ridge Coal Company, was dismissed for lack of any evidence in its behalf. Various motions were made at the trial by the defendant with respect to the right of other individual plaintiffs to maintain this suit, but action upon these individual motions was reserved for this opinion. The ease was tried by the Court sitting without a jury. The trial extended over a period of weeks with a record in excess of five thousand six hundred pages having been made and four hundred fifty exhibits having been filed, many of the exhibits themselves being quite voluminous. This lawsuit has been well tried and the parties have submitted excellent briefs. At the time the lawsuit in Docket No. 3667 was tried, there was pending upon the dockets of this court the case of Tennessee Products & Chemical Corporation v. United Mine Workers of America and West Kentucky Coal Company, Inc., Docket No. 4189. This lawsuit contained almost identical allegations of liability as were involved in Docket No. 3667. Following the trial and submission of briefs in the original action, Docket No. 3667, the parties undertook negotiations in Docket No. 4189, which negotiations eventually led to a dismissal of that action as to the defendant, West Kentucky Coal Company, Inc., and to a stipulation by the parties that the issue of liability in that case would be submitted to the Court for decision upon the record made in the trial of Docket No. 3667. This opinion would accordingly decide all issues in Docket No. 3667 but only the issue of liability in Docket No. 4189. SUMMARY OF CONTENTIONS A summary of the contentions of the parties would lay an appropriate foundation for the analysis of the evidence and the factual and legal conclusions which the Court must make in deciding these cases. The Court will accordingly attempt a concise statement of the theories advanced by the respective parties. Plaintiffs’ Contentions The plaintiffs contend that the defendant, United Mine Workers of America (sometimes hereinafter referred to as “U.M.W.”) has over a number of years now engaged in an unlawful conspiracy with certain coal operators to eliminate and suppress competition in the coal industry, to control the Southern Appalachian coal fields and to suppress or eliminate the production of coal in the Southeastern Tennessee coal fields. This conspiracy is alleged to violate Sections 1 and 2 of the Sherman Antitrust Act (15 U.S.C. Sections 1 and 2). It is alleged that the major coal producers in Pennsylvania, Ohio and adjacent states, including among others Consolidation Coal Company and Island Creek Coal Company, had prior to 1950 largely dominated the production and marketing of coal in the Appalachian area. This domination was threatened by the rise of small independent producers during and following World War II. By 1949-1950 the coal industry in America was confronted with a problem of over production. Thereupon, commencing with the National Bituminous Coal Wage Agreement of 1950, the U.M.W. combined and conspired with major coal companies to force uniform wages which only the larger companies could meet on all coal producers in the nation, including those in marginal seams, such as the plaintiffs, to restrain competition from those many small producers who were operating under conditions where they could not possibly perform the terms of the national contract and thus to eliminate the competition of producers from the market, thereby permitting the markets to be taken over by the major coal combines. Successive amendments to the National Bituminous Coal Wage Agreement of 1950 were negotiated between the U.M.W. and the major coal producers in 1951, 1952, 1955, 1956 and 1958 raising wages to an exceedingly high level and increasing the welfare fund royalty from 100 a ton to 400 a ton. It is alleged that these amendments were a part of the same conspiracy and in furtherance of the same monopolistic practices. The successive increases in the wage scale and welfare fund payments were designed and tailored to meet the abilities of the major coal companies to mechanize and not have their profits affected by the increasing labor costs, the U.M.W. all the while having full knowledge that the smaller companies could not pay the wage scale and royalties and would therefore fall by the wayside. It is alleged that the U.M.W. favored the coal industry being taken over by the large combines of coal producers and in furtherance of this engaged in a campaign to impose the wage contracts upon the small independent and non-union mines, this effort by the Union being particularly intense after 1950. Mob violence and terrorism were used by the Union in furtherance of these purposes. To accelerate the demise of small companies, provisions were placed in the national contract whereby the operators agreed not to lease coal lands or purchase coal from nonsignatories to the contract. In 1958 an amendment to the contract was negotiated whereby the U.M.W. expressly agreed not to enter into any agreement with other coal operators upon any basis other than the national contract. In the meantime, the rapid expansion of the Tennessee Valley Authority steam plant system during the 1950’s, resulting in the T.V.A. becoming the largest coal purchaser in the nation, called the attention of the conspirators to the Southern Appalachian region. The U.M.W. thereupon invested over $25,000,000 in coal companies, principally the West Kentucky Coal Company, and its subsidiary, Nashville Coal Company, and these companies, along with other conspirators, adopted the practice of predatory pricing to drive the T.V.A. coal market price down to a level where small producers could not compete upon the market. Large tonnages of coal were dumped on the T.V.A. market at constantly lower prices. During the same time it is alleged that the U.M.W. sought to suppress production of coal by the plaintiffs by creating labor turmoil, violence and intimidation throughout the Southeastern Tennessee coal fields. In this manner, by reducing production in the Southeastern Tennessee coal field by labor turmoil, while at the same time forcing the T.V.A. coal market price downward, the plaintiffs were caused to lose their principal market, the T.V.A. steam plant market. The conspiracy thus manifested itself in the Southeastern Tennessee coal fields by a squeeze applied to the local operators both from the market side and from the labor side. While large producers in other fields, including companies owned by the U.M.W., applied downward pressure on the price of coal in the plaintiffs’ principal market, U.M.W. sought to raise labor costs by forcing the national contract upon the plaintiffs, by interfering with production, by engaging in widespread acts of violence and intimidation, and by closing down the Southeastern Tennessee coal fields for long periods of time by means of labor turmoil. It is alleged that the result of all of these actions has been that a large number of small coal companies, including many of the plaintiffs, have been driven out of the coal industry and large numbers of coal miners have been put out of work. Those plaintiffs who have managed to survive contend that they have been severely damaged by the defendant’s monopolistic practices. Defendant’s Contentions The defendant denies participation in any conspiracy and denies that the plaintiffs have been the victims of any antitrust violations on the part of the defendant. On the contrary, the U.M.W. contends that the plaintiffs have been the victims of their own mismanagement, their own ineptness, their own failure and refusal to keep up with the industry, and have created their own labor turmoil, either by refusing to enter collective bargaining agreements or by refusing to abide by the terms of the agreements which they had signed. The U.M.W. contends that its activities have at all times been legitimate activities for a labor union, that it has always acted to further the best interests of its members by arms’-length bargaining with coal operators, all in accordance with federal labor laws and federal labor policy. From its inception in 1890, the U.M.W. contends that it has consistently sought to unite all workers employed in the coal industry in one organization and that it has always vigorously sought to achieve national uniformity in wages, labor standards and mine safety requirements. It has always refused to subsidize marginal operators through substandard labor conditions. It contends that the 1950 National Bituminous Coal Wage Agreement was the result of good faith collective bargaining- — bargaining conducted under the strict scrutiny and supervision of federal authorities, including the federal courts. It denies any conspiracy then or thereafter to drive any coal producers out of the industry. While not attempting to force mechanization upon the industry, the U.M.W. recognized that mechanization was the inevitable result of technological advances and of competition with other fuels and accordingly has not opposed such mechanization. On the contrary, it has sought through collective bargaining to assure that its members would share in the benefits of increased productivity. The defendant contends that all amendments to the National Wage Agreement since 1950 have likewise been the result of good faith collective bargaining and not the result of any conspiracy as contended by the plaintiffs. The U.M.W. denies that the land lease clause or the clause in regard to subcontracting was a part of any conspiracy aimed at small producers, but avers that they were solely to protect the integrity of the labor standards negotiated in the contract and to prevent signatories to the contract from using these means to escape from their obligations under the contract. The protective wage clause negotiated in 1958 was merely a commitment upon the part of the U.M.W. to enforce the contract alike on all signatories. The National Wage Agreement of 1950 and all of its subsequent amendments have been the result of good faith collective bargaining and have involved only traditional and lawful labor union aims, policies and activities. The U.M.W. contends that loans and investments of union funds in West Kentucky Coal Company were lawful loans and investments and were for lawful purposes and were not a part of any Sherman Act conspiracy. The U.M.W. denies that it ever influenced or sought to influence the management or coal sales policies of West Kentucky Coal Company. It denies that it was in any way a party to such sales policies. Furthermore, the U.M.W. contends that West Kentucky Coal Company never sought to depress the T.V.A. market and denies that West Kentucky Coal Company ever engaged in predatory pricing of coal to the T.V.A., but contends upon the contrary that West Kentucky Coal Company merely followed the market in submitting its bids and sought coal sales for legitimate business purposes and at legitimate business prices. The U.M.W. contends that its activities in the Southeastern Tennessee coal fields have at all times-been legitimate and traditional labor union activities and denies that they were part of any Sherman Act conspiracy. The U.M.W. contends that the plaintiffs have by their own conduct and activities fomented the labor trouble and unrest in the Southeastern Tennessee coal fields. The U.M.W. contends that despite the fact that it has at all times represented the overwhelming number of coal miners in the area, the plaintiffs have often failed and refused to negotiate collective bargaining agreements and when agreements were signed the plaintiffs have repeatedly refused to live up to the terms of their contract. The U.M.W. denies that it was in any way responsible for acts of violence or intimidation, but avers on the contrary that it always sought to restore peace and order to the coal fields and to require its members to live up to their contracts. The U.M.W. avers that the plaintiffs’ failure to remain competitive in the T.V.A. coal market is the result of mismanagement, the attempt to mine coal by hand or other antiquated methods, the failure to keep abreast of modem production methods and other reasons unrelated to labor costs or union activities. The U.M.W. denies that the plaintiffs, or any of them, are entitled to recover any damages against it in these lawsuits. LEGAL GUIDELINES A necessary prelude to undertaking an analysis of the record in this lawsuit is a review of the federal antitrust laws and their application to labor unions. This lawsuit is founded upon Sections 1 and 2 of the Sherman Act wherein it is declared that “every contract, combination * * * or conspiracy, in restraint of trade or commerce * * * is * * illegal * * * ” and “every person who shall monopolize or attempt to monopolize * * * or conspire with any other person * * * to monopolize any part of the trade or commerce * * * ” shall be guilty of a violation of antitrust laws. (15 U.S.C., Sections 1 and 2) The Sherman Act “was enacted in the era of ‘trusts’ and ‘combinations’ of businesses and of capital organized and directed to control of the market by suppression of competition on the marketing of goods and services, the monopolistic tendency of which had become a matter of public concern.” Apex Hosiery Co. v. Leader, 310 U.S. 469 at 492, 60 S.Ct. 982, 84 L.Ed. 1311 at 992 (1940). The Act was not long in being applied to labor union activities. In 1908 the Supreme Court in Loewe v. Lawler, 208 U.S. 274, 28 S.Ct. 301, 52 L.Ed. 488, held that the use of a secondary boycott by a union, directed at eliminating sales of non-union goods, in an effort to compel an employer to unionize his shop was a combination in restraint of commerce within the purview of the Sherman Act. This view of the matter was shortly changed by Congress, when in 1914 it amended and supplemented the Sherman Act with the Clayton Act. Section 6 of the latter Act established as national policy the exempting of labor unions from the Sherman Act: “The labor of a human being is not a commodity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor * * organizations * * * or to forbid * * * such organizations from lawfully carrying out the legitimate objects thereof * * * ” (15 U.S.C., Sec. 17) By 1921 the Supreme Court in Duplex Printing Press v. Deering, 254 U.S. 443, 41 S.Ct. 172, 65 L.Ed. 349, had interpreted the language of Section 6 of the Clayton Act as granting no immunity from antitrust liability “where (unions) depart from normal and legitimate objects * * * ” Duplex, and the line of cases following it, was met by further Congressional action in 1932 with passage of the Norris-LaGuardia Act (29 U.S.C. § 101 et seq). While worded as a restriction upon the use by federal courts of injunctions in cases growing out of labor disputes, it was soon recognized by the Supreme Court as having as its purpose the “underlying aim * * * to restore the broad purpose which Congress thought it had formulated in the Clayton Act but which was frustrated”. United States v. Hutcheson, 312 U.S. 219, 61 S.Ct. 463, 85 L.Ed. 788. By establishing the national labor policy in subsequent labor legislation (i. e., the National Labor Relations Act, the Labor Management Relations Act and the Labor-Management Reporting and Disclosure Act of 1959), Congress has further defined and restricted the scope of antitrust application to labor union activities. The problem for the courts in this area has come to be the reconciliation of two declared Congressional policies, one seeking to preserve a competitive business economy and the other seeking to preserve the rights of labor to organize and seek to better conditions of employees through collective bargaining. The modern phase of the law in this respect may be said to have begun with the case of Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311. There the Court was confronted with an antitrust action predicated upon union violence in the course of a strike occasioned by an organizational dispute. In construing the substantive reach of the Sherman Act, the Court held that the statute was not intended to cover any activity, by a labor union or anyone else, unless it had or was intended to have a substantial effect upon “commercial” competition, such as by restricting production or prices or otherwise impairing free competition on the market. Furthermore, even where commercial competition was affected, “an elimination of price competition based on differences in labor standards is the objective of any national labor organization. But this effect on competition has not been considered to be the kind of curtailment of price competition prohibited by the Sherman Act.” Id. at 503, 60 S.Ct. at 997. The scope of labor’s antitrust exemption thus became relevant only if its acts had the purpose or effect of injuring commercial competition in the market place, as distinguished from the labor market. Next came United States v. Hutcheson, 312 U.S. 219, 61 S.Ct. 463, 85 L.Ed. 788, where the Court addressed itself specifically to the labor union exemption from the antitrust laws as contained in the Clayton Act and the NorrisLaGuardia Act. The Court found that a strike and economic boycott were expressly exempt from Sherman Act liability, even though the union’s dispute was essentially jurisdictional rather than with the injured employer. “So long as a union acts in its self-interest and does not combine with non-labor groups, the licit and the illicit under § 20 are not to be distinguished by any judgment regarding the wisdom or unwisdom, the rightness or wrongness, the selfishness or unselfishness of the end of which the particular union activities are the means.” Id. at 232, 61 S.Ct. at 466. In 1945 the case of Allen Bradley Co. v. Local 3 I. B. E. W., 325 U.S. 797, 65 S.Ct. 1533, 89 L.Ed. 1939, was decided. There the union had obtained an agreement whereby all electrical contractors were to purchase electrical equipment exclusively from local manufacturers employing union labor. The manufacturers in turn agreed to sell only to contractors who employed union members. The Court held that Congress never intended that unions could, consistently with the Sherman Act, aid non-labor groups to create such monopolies or control the marketing of goods and services. The Court concluded that “When the unions participated with a combination of businessmen * * * to prevent all competition from others, a situation was created not included within the exemptions of the Clayton and Norris-LaGuardia Acts”. Id at 809, 65 S.Ct. at 1540. Of controlling significance to the issues of the present lawsuit is the recent case of United Mine Workers v. Pennington, 381 U.S. 657, 85 S.Ct. 1585, 14 L.Ed.2d 626. The theories of the parties and the issues there involved bear a close similarity to the theories and issues here involved. Upon the same day the Supreme Court also decided the case of Local Union No. 189, etc. Meat Cutters Union v. Jewel Tea Co., 381 U.S. 676, 85 S.Ct. 1596, 14 L.Ed.2d 640. These cases must be read together to understand their full import. Even then some uncertainty as to the full import must persist, as these cases produced five .separate opinions expressing differing views. In Pennington the U.M.W. had sued a coal producer from the Northern Tennessee coal field for welfare fund payments. Pennington counterclaimed, alleging that the union had violated the Sherman Act by conspiring with certain large coal companies to drive smaller mine operators, including the defendant, from the coal industry. A verdict was returned against the U.M.W. Upon appeal the Supreme Court denied the U.M.W.’s claim to exemption from the antitrust laws for its activities. The relevancy of the case to the issues here involved can best be stated by quoting the following excerpts from the opinion of Mr. Justice White, who wrote'for a majority of the Court: “We have said that a union may make wage agreements with a multi-employer bargaining unit and may in pursuance of its own union interests seek to obtain the same terms from other employers. No case under the antitrust laws could be made out on evidence limited to such union behavior. But we think a union forfeits its exemption from the antitrust laws when it is clearly shown that it has agreed with one set of employers to impose a certain wage scale on other bargaining units. * * * ****** “ * * * This Court has recognized that a legitimate aim of any national labor organization is to obtain uniformity of labor standards and that a consequence of such union activity may be to eliminate competition based on differences in such standards * * * But there is nothing in the labor policy indicating that the union and the employers in one bargaining unit are free to bargain about the wages, hours and working conditions of other bargaining units or to attempt to settle these matters for the entire industry * * * ” ****** “ * * * The policy of the antitrust laws is clearly set against employer-union agreements seeking to prescribe labor standards outside the bargaining unit.” ****** “ * * * all such agreements between a group of employers and a union that the union will seek specified labor standards outside the bargaining unit suffer from a more basic defect, without regard to predatory intention or effect in the particular case. For the salient characteristic of such agreements is that the union surrenders its freedom of action with respect to its bargaining policy * * * After the agreement the union’s interest would be bound in each case to that of the favored employer group. It is just such restraints upon the freedom of economic units to act according to their own choice and discretion that run counter to antitrust policy.” The Jewel Tea case followed a somewhat different aspect of the labor union exemption from the Sherman Act. There the employer, Jewel Tea Company, challenged the validity of a clause in its collective bargaining contract which prevented it from operating its meat counters after six o’clock in the evening or before nine o’clock in the morning. The plaintiff had agreed to the marketing-hours restriction only after threat of a strike. The trial court expressly found that, while some 9,000 other meat retailers had agreed to the marketing-hours restriction, the union had formulated the restriction and pursued its adoption alone and to serve its own interests. Adopting the trial court’s finding that no union-employer conspiracy existed, Mr. Justice White stated: “The issue in this case is whether the marketing-hours restriction, like wages, and unlike prices, is so intimately related to wages, hours and working conditions that the union’s successful attempt to obtain that provision (unilaterally) * * * falls within the protection of the national labor policy * * * The concern of union members is immediate and direct.” The opinion concluded that a meat market’s hours of operation was so closely related to “wages, hours and working conditions” as to be within a mandatory subject of bargaining under federal labor laws and thus within the labor union exemption from the Sherman Act. Extracting what appears to be the majority opinion of the Court in both the Pennington and Jewel Tea cases, the rule would seem to be that a labor union is exempt from the operation of the federal antitrust laws provided that it acts unilaterally, in the pursuit of its own self-interests rather than in combination or conspiracy with non-labor groups and provided further that its activities be in furtherance of a subject matter of immediate and legitimate union concern, such as wages, hours and working conditions, and not in furtherance of matters which are only of indirect concern to the union, such as prices and other marketing factors. A more difficult problem is posed in attempting to extract from Pennington and Jewel Tea a statement of the present status of the rule with respect to antitrust liability of a labor union where the exemption does not apply. In his concurring opinion in Pennington, Justice Douglas appears to have read the majority opinion as holding that an industry-wide collective bargaining agreement which exceeds the ability of some employers to conform is prima facie evidence of a forbidden conspiracy, that is a conspiracy whose purpose is to force some employers out of business. While Justice Douglas would require proof of predatory intent, i. e. that the purpose was to force some employers out of business — the prima facie rule suggested by him and concurred in by two other justices does not appear to have received support either in the opinion of Justice White or the dissenting opinion of Justice Goldberg. On the contrary, Justice White expressly held that a union, provided that it acts unilaterally, may lawfully adopt a uniform wage scale even though it may suspect that some employers could not pay the scale and continue to compete. Justice Goldberg would hold any union agreement relating to a mandatory subject of collective bargaining, such as wages, should be immune from antitrust liability regardless of the economic consequences involved. To hold that a union, in doing what it lawfully is entitled to do thereby creates a prima facie case of illegal activity is a contradiction in terms. The opinions of Justice White and Justice Goldberg between them obtained the concurrence of six members of the Court. On the other hand, Justice White used language in his opinion in the Pennington case that would support a rule that no proof of predatory intent is required once it has been established that a union has lost its exemption by entering an agreement with one group of employers to seek specified labor standards from another set of employers not included within the bargaining unit. As stated by Justice White: “From the viewpoint of antitrust policy, moreover, all such agreements between a group of employers and a union that the union will seek specified labor standards outside the bargaining unit suffer from a more basic defect, without regard to predatory intention or effect in the particular case.” (Emphasis added.) If it was the intent of the foregoing language to remove the usual rule of reason applied in antitrust cases and substitute a per se rule, either with regard to the specific circumstances described or with respect to all cases in which the union is found to have lost its antitrust exemption, it would appear that the opinion is not supported by a majority of the ■Court. Neither the concurring opinion of Justice Douglas nor the dissenting opinion of Justice Goldberg supports such a per se rule. The opinions of Justiee Douglas and Justice Goldberg between them obtained the concurrence of six members of the Court. By way of summary, while Justice White would require proof of the conspiracy between the union and the favored employers, he would appear to require no proof that the purpose was to put other employers out of business. On the other hand, Justice Douglas would require that it be made to appear that the agreement was “made for the purpose of forcing some employers out of business,” but he would hold that any industry-wide collective bargaining agreement setting a wage scale that exceeded the financial ability of some employers to pay creates a prima facie case of conspiracy. Neither the per se rule of Justice White nor the prima facie rule of Justice Douglas appears to have received the support of a majority of the Court. Turning now to other matters, the first and second sections of the Sherman Act embrace “every conceivable act which could possibly come within the spirit or presence of the prohibition of the law, without regard to the garb in which such acts are clothed”. United States v. American Tobacco Co., 221 U.S. 106, 31 S.Ct. 632, 55 L.Ed. 663. There excepted from this broad statement ride activities seeking to influence governmental action, whether such activities are in concert with others or not and regardless of the motive or purpose that may have prompted such activities, Activities so directed are embraced with-the constitutional right to petition governmental authority and are absolutely Privileged from any antitrust consequence Eastern Railroad Conference Noer Motors, 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464; United Mine Workers v. Pennington, supra Evidence of su+ch ™ay nevertheless be cornPfent to show the purpose and character of prlor or subsequent conduct, The U.M.W. is here charged with a Sherman Act conspiracy. In this respect a conspiracy may be defined as a combination of two or more persons to accomplish by concerted action an unlawful or oppressive object, or a lawful object by unlawful or oppressive means, Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311; National Fireproofing Co. v. Mason Builders Association, 2 Cir., 169 F. 259, 26 L.R.A.,N.S., 148. It is not the form of combination nor the means used, whether lawful or unlawful, but rather it is the anticompetitive result that the stat-ute condemns. Acts done to give effect to the conspiracy may be in themselves wholly innocent acts. Yet, if they are Part the sum total of acts which are relied uP°n to effectuate the conspiracy which the statute forbids, they come within its prohibition. American Tobacco Co. v. United States, 328 U.S. 781, 66 S.Ct. 1125, 90 L.Ed. 1575. The character and effect of a conspiracy are not to be judged by dismembering the conspiracy and viewing its separate parts, but rather by looking at the evidence bearing upon the conspiracy as a whole. As stated by the Court in Continental Ore Co. v. Union Carbide Corp., 370 U.S. 690, 82 S.Ct. 1404, 8 L.Ed.2d 777: “In cases such as this, plaintiffs should be given the full benefit of their proof without tightly compartmentalizing the various factual components and wiping the slate clean after scrutiny of each. ‘ * * * (T)he character and effect of a conspiracy are not to be judged by dismembering it and viewing its separate parts, but only by looking at it as a whole. United States v. Patten, 226 U.S. 525, 544 [33 S.Ct. 141, 57 L.Ed. 333] * * * ; and in a case like the one before us, the duty of the jury was to look at the whole picture and not merely at the individual figures in it.’ American Tobacco Co. v. United States, 147 F.2d 93, 106 (C.A.6th Cir). See Montague & Co. v. Lowry, 193 U.S. 38, 45-46, [24 S.Ct. 307, 309] 48 L.Ed. 608, 611, 612.” One further subject needs to be given attention here and that is the standard of proof that must govern a proceeding involving a Sherman Act charge against a labor union. The burden of proof borne by the plaintiff is not the usual preponderance of the evidence rule applicable in civil cases generally. The requirement imposed by Section 6 of the Norris-LaGuardia Act is that of “clear proof” where a labor organization is a party to an action such as this. (29 U.S.C. § 106) In a recent case arising from this district, United Mine Workers v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218, Justice Brennan, in writing the opinion of the Court, had this to say with respect to the meaning of the “clear proof” rule established by Section 6 of the NorrisLaGuardia Act: “Although the statute does not define ‘clear proof,’ its history and rationale suggest that Congress meant at least to signify a meaning like that commonly accorded such similar phrases as ‘clear, unequivocal, and convincing proof.’ Under this standard, the plaintiff in a civil case is not required to satisfy the criminal standard of reasonable doubt on the issue of participation, authorization or ratification ; neither may he prevail by meeting the ordinary civil burden of persuasion. He is required to persuade by a substantial margin, to come forward with ‘more than a bare preponderance of the evidence to prevail.’ Schneiderman v. United States, 320 U.S. 118, 125, 63 S.Ct. 1333, 1336, 87 L.Ed. 1796, 1802.” That the “clear proof” standard applies to an action wherein a labor organization is sought to be charged with a Sherman Act violation appears settled. United Brotherhood of Carpenters v. United States, 330 U.S. 395, 67 S.Ct. 775, 91 L.Ed. 973. See also Lewis v. Pennington, 257 F.Supp. 815 (D.C.E.D.Tenn., 1966). PARTIES An identification of the parties plaintiff in these lawsuits and of the coal mining operations conducted by each, as well as an understanding of their relationship to one another, will be helpful at this point. Two companies control the major portion of the coal mining lands in the Southeastern Tennessee coal field. These two companies are Tennessee Products & Chemical Corporation (Tennessee Products) and Tennessee Consolidated Coal Company (Tennessee Consolidated). Tennessee Products is the party plaintiff in one of these lawsuits (Docket No. 4189). Tennessee Consolidated is not a party, but has a lawsuit pending in this court seeking similar relief (Docket No. 4178). Tennessee Products was formed during World War I. It conducts a diversified operation in which coal mining is one part. It entered the Southeastern Tennessee coal field in 1938. In 1954 it became a wholly owned subsidiary of Merritt-Chapman & Scott, itself a national enterprise with diversified interests. Tennessee Products conducts its coal mining operations on 24,075 acres of land in the Southeastern Tennessee coal field leased to it by the Tennessee Coal & Iron Division of the United States Steel Corporation (T.C.I.;. T.C.I. receives a royalty of 170 per ton for all coal mined and receives a minimum guaranteed payment of $5,000.00 per month whether coal is mined or not. Tennessee Products is required to report and account for its mining operations each month, including those of any subcontractors. Prior to World War II Tennessee Products operated one large hand loading mine. During and following the war a number of small truck mines were opened so that by January 1956 more than 100 such small mines were being operated. Most of them, and eventually all of them, were subleased. In 1956 the small mines produced 1,189,763 tons as compared with 396,383 tons for the large mine operated by Tennessee Products. Tennessee Consolidated, while not a party to this lawsuit, is frequently referred to in the record. It was formed in 1905 and is principally owned and operated by two families, the Hamptons and the Roberts. It owns some 50,000 acres of land in Southeastern Tennessee, of which 38,700 acres are coal bearing. The same interests which own Tennessee Consolidated also own Whitwell Coal Company (Whitwell), although in different proportions, with Tennessee Consolidated itself being the largest stockholder in Whitwell. Whitwell acts as a sales agency handling bids to the Tennessee Valley Authority (T.V.A.) for the truck mines operating as lessees of Tennessee Consolidated property. For a time Whitwell conducted a strip and auger mining operation with equipment leased from Tennessee Consolidated. Grundy Mining Company (Grundy) is a wholly owned subsidiary of Tennessee Consolidated formed in 1959. After 1959 Grundy was the coal mining company for these related enterprises, leaving Tennessee Consolidated in the status of a land company. In 1940 Tennessee Consolidated subleased a large portion of its coal lands to the A. L. Henderson lease, a partnership made up of stockholders and officers of Tennessee Consolidated. The A. L. Henderson lease in turn subleased to a number of small truck mine operators, who paid royalty to the Henderson partnership and sold their coal through the Whitwell Coal Company. Both Tennessee Products and TennesT see Consolidated maintain a number of truck mine operations on their respective properties. These truck mines operate under lease, some leases being verbal and others in writing. Some leases are from month to month, some from year to year, and others for longer terms. Tennessee Products and Tennessee Consolidated receive royalties from the lessees in varying amounts, such as 250 to 600 or more, for coal extracted and received additional sums for insurance, engineering, sales and coal handling charges and mine supervision in some instances. There appears to have been considerable shifting of lessees and leasehold interests during the period here under consideration. It is these lessees from Tennessee Products and Tennessee Consolidated that constitute the major number of plaintiffs in Docket No. 3667. Some of the lessees operate one mine, some more than one, and some do not mine at all but sublease to or subcontract with others. Some truck mines operate in the workings of abandoned major mines and rob the remnants; others work in virgin coal land. On the average, it appears that truck mines work out their leasehold in from two to five years. Mining methods in the truck mines run the gamut from primitive to advanced methods of mining. Some operators shoot from the solid, load coal by hand and haul it to the tipple by mule. Others are substantially mechanized, using cutting machines, mobile loaders and continuous hauling from the face by chain conveyor or rubber tired shuttle cars. Many operate between these ranges. Among the plaintiffs in Docket No. 3667 there are three exceptions to the foregoing leasing arrangements. One of these is George Ramsey; another is the J. H. Graham Coal Company, Inc.; the third is East Valley Coal Company. George Ramsey is an individual doing business as Ramsey Coal Company. He conducts a strip mine operation, the only such operator among the plaintiffs. He commenced coal stripping operations in the 'Southeastern Tennessee coal fields in 1951. Originally he leased coal lands, but later purchased land and his operation has grown from a two or three man operation to one employing some 20 or more men. J. H. Graham Coal Company, Inc., is a corporation organized by J. H. Graham, W. J. Travis and W. T. Morrison in 1958 and 1959. It has six rather small mines upon leased lands near Spring City, Tennessee. All of these were either subcontracted or subleased. East Valley Coal Company was commenced in 1950 by Edward Nunley, the business being incorporated in 1957. This company operated a hand loading mine on the Prentice Cooper State Forest lands. Nunley, as noted below, also leased a mine from Tennessee Products in his individual name. Of the remaining plaintiffs, ten were lessees of Tennessee Products and two were lessees of Tennessee Consolidated. A brief description of the remaining plaintiffs and their operations is as follows: Tennessee Products Lessees: (a) Leon Nunley, an individual operating as the Leon Nunley Coal Company, commenced in .1953 and operated two hand loading mines. In 1959 he moved to another mine and set up a partially mechanized operation. (b) Edward Nunley, an individual operating as the Edward Nunley Coal Company, commenced in 1955 with a single mine which he subcontracted to another to operate while he hauled coal. (c) Paul Gibbs, an individual operating as the Paul Gibbs Coal Company, commenced in 1953 on Tennessee Products land. He had several hand loading mines, some of which he operated and others of which he subcontracted the operation while he hauled coal. (d) The Ninth West Coal Company was a partnership organized in 1955 by W. J. Travis and J. H. Graham. It was incorporated in 1962. This company leased a number of truck mines in the Whitwell area which it subcontracted to various individuals to operate. All but one of these mines were hand loading mines. (e) The A & R Coal Company, Inc., was a corporation formed by Allen Johnson and Richard Johnson, but later sold to J. H. Graham and W. J. Travis. It operated a mechanized truck mine in 1959 and 1960 in the Daus Mountain area. (f) The M & T Coal Company was a partnership organized in 1953 by W. T. Morrison and W. J. Travis. It subleased mines in the Whitwell area from Tennessee Products which it in turn subcontracted to various individuals to operate. These were hand loading, non-mechanized mines. (g) The M & G Coal Company was a partnership formed in 1958 by W. T. Morrison and J. H. Graham. It took over the mines of the M & T Coal Company. It had leases from Tennessee Products on hand loading mines in the Whitwell area, which mines it subcontracted to others to operate. (h) Stephenson Brothers Coal Company, Inc., was organized in 1959 as the successor to a partnership between John Stephenson and Howard Stephenson, who had operated mines since 1946. This coal company leased a number of mines in the Mount Olive (Whitwell) area from Tennessee Products and operated some of the mines and subcontracted others. Coal was hand loaded in these mines. (i) Lon Varnell, an individual doing business as the Tracy City Coal Company, leased a mine in 1959 from Tennessee Products. The mine was opened as a hand operated, non-mechanized mine, but later was partially mechanized with cutting machines and locomotives, but continued to load coal by hand. The operation of the mine was subcontracted first to Barney Johnson and Hembree Brown and later to Stanley Yarworth and Herman Johnson. (j) Marshall Meeks leased mines from Tennessee Products commencing in 1954. Originally he subcontracted the operation of these non-mechanized mines, while he hauled coal. In 1959 he leased a mine which he mechanized and thereafter operated himself. Tennessee Consolidated Lessees: (a) Howard Higgins subleased a mine in the Floyd Hollow area from the A. L. Henderson partnership, which partnership had in turn leased from Tennessee Consolidated. This was a hand operated mine. In 1958 the business was incorporated as the Howard Higgins Coal Company, Inc., to admit as silent partners two officials of Tennessee Consolidated who were later forced to withdraw, however, as their interest was discovered. In 1961 the Henderson lease was cancelled and Higgins leased directly from Tennessee Consolidated and operated the mine himself. (b) The H. W. Flynn Coal Company, Inc., was organized in 1958 as the successor to Howard Willis Flynn, an individual. It subleased from the A. L. Henderson partnership, who in turn leased from Tennessee Consolidated. After cancellation of the Henderson sublease in 1961, it leased directly from Tennessee Consolidated. During all of the time it operated a hand loading, non-mechanized mine. Defendant The United Mine Workers of America is an international labor union first organized on January 25, 1890. It was organized to unite all workers employed in the mining and related industry. The highest official body of the Union is the International Convention which met every two years, but since 1942 has met every four years. In between conventions the International Executive Board of the Union has supreme authority. With respect to collective bargaining agreements between international conventions, an International Policy Committee or “Scale Committee” was established and any collective bargaining agreement negotiated by the national officers must have the approval of this committee. The International Union is divided into districts with each district being entitled to a member on the International Executive Board. Some districts are autonomous and elect their officers. Others are provisional and their officers are appointed by the International President, subject to the approval of the International Executive Board. District 19, U.M.W., which has jurisdiction over the Southeastern Tennessee coal fields and has headquarters located in Middlesboro, Kentucky, is a provisional district. Its president, vice president and secretary-treasurer are all appointed by the International President. The District President in turn appoints the field representatives and organizers who work in the field in cooperation with local unions. John L. Lewis served as President of the International Union from 1920 until 1960 and has been President Emeritus since that time. Thomas Kennedy was President of the International Union from 1960 until his death in 1962. W. A. Boyle then became acting president and was elected President of the International Union in 1963. He has continued to serve in that position until the present time. 1950 NATIONAL BITUMINOUS COAL WAGE AGREEMENT As noted above, the plaintiff contends that the antitrust conspiracy herein sued upon commenced with the negotiation by the U.M.W. of the 1950 National Bituminous Coal Wage Agreement. The defendant denies this and contends that the 1950 Agreement was but a continuation and partial realization of the legitimate labor union aims and policies which it had pursued since its organization in 1890. An analysis of the evidence must accordingly be made both with respect to pre-1950 collection bargaining between the U.M.W. and the coal operators and the bargaining culminating in the 1950 Agreement. Pre-1950 Collective Bargaining Industry-wide collective bargaining in bituminous coal mining had its beginning as far back as 1886 when a joint conference was initiated between the operators and miners of Ohio, Indiana, Illinois and Pennsylvania. The area covered by the joint conference has varied somewhat from time to time through the years and the tonnage represented has varied from 40% to 70% of the total national production of bituminous coal. This area has often been referred to as the “Central Competitive Field” and collective bargaining in the industry has been characterized by the fact that wage rates fixed in the central competitive field has substantially affected, if not largely determined, wage rates in all other bituminous coal fields in the United States. It appears clear from the evidence that national uniformity in wage rates and labor standards in the coal industry has been a consistent policy and goal of the U.M.W. since its inception in 1890. The removal of differences in labor standards and wage rates as an element of competition within the bituminous coal industry has been the core of U.M.W.’s policy throughout the years of its existence. Wage cutting to meet price competition has been consistently opposed by the Union as being self-defeating in that it “generates a corresponding reduction in •every other competitive coal field”. Almost every International Convention has urged a uniform work day and a uniform wage scale in all classes of the same labor. Although sectional and regional differences in wages have historically existed in the coal industry, their elimination has been the uniform policy of the U.M.W. In the early days an effort was made by the U.M.W. to arrive at a wage base in the central competitive field that would then become the guideline of the various “outlying districts” as most fields outside the central competitive field were called. Slow but steady collective bargaining process appears to have been made by the Union until 1924. In that year a contract was negotiated at Jacksonville, Florida, (the “Jacksonville Agreement”) with the central competitive field. The agreement sought to hold the line on wages by extending the existing scale of wages for a period of three years. Some outlying districts refused to go along, however, and severed relations with the U.M.W. In the competition that resulted, operators in other districts, including the central competitive field, renounced their contracts. Collective bargaining was substantially curtailed and contracts ignored. Prices and wages went down and there was a general breakdown in the economic structure of the industry. The plight of the industry continued in this direction until 1933 when the industry was in a virtual state of chaos. It should be noted here that early in the history of the industry there developed two methods of determining wage rates, one being a “tonnage rate” generally paid to those whose production could be measured in tonnage, and a “day rate” for all other workers. Sectional and regional differences in both of these rates existed from the beginning. By 1933 there was little' or no uniformity in wages even within districts. For example, in Western Pennsylvania wages varied from $3.50 per 10-hour day to $1.50 per 12-hour day for the same job classification. In 1933 the Federal Government stepped in with the N.R.A. and sought to impose codes of fair competition on the industry. The codes recognized wage differentials between districts, but not within districts. Also, in 1933 a collective bargaining agreement was negotiated (the “Appalachian Agreement”) between the U.M.W. and operators representing approximately 72% of the national tonnage. The Appalachian Agreement established a day rate differential of 40^ in favor of the Southern West Virginia, Eastern Kentucky, Virginia and Tennessee. Similar differentials in tonnage rates were also recognized. Further efforts to stabilize coal marketing and production led to the passage of the Guffey Act by Congress. The purpose of this legislation was to establish codes on pricing, but the increasing demands for coal in the approaching World War II period led to the repeal of the Act. In the Appalachian Conference of 1941, the U.M.W. demanded elimination of both the tonnage differential and the day rate differential between northern and southern coal fields. The Conference split over these negotiations, with the southern operators withdrawing. An agreement was then concluded with the northern operators eliminating the 400 daily wage differential, but the Union dropped the demand for elimination of the tonnage rate differential. The Union, however, agreed upon a “favored nation” clause which committed it to grant to the northern operators any more favorable terms than were negotiated by the Union with the southern operators. This insured elimination of the 400 differential in event a contract was negotiated with the southern operators. In negotiations with the southern operators this issue went to the National Defense Mediation Board and it recommended elimination of the 400 differential. The recommendation was accepted by the southern operators. The elimination of the 400 differential in 1941 did not completely eliminate the differential that had existed in the Southeastern Tennessee coal field, which differential continued to amount to 230 per hour on the day rates. A tonnage rate differential of 30 to 150 per ton also continued to exist. The $16.25 per wage day increase negotiated between 1945 and 1965 has been added across the board on the rates existing in 1941. Thus, a slight differential continues to exist in favor of the Southeastern Tennessee coal fields, although substantial reduction in the number of employees paid on a tonnage basis caused by mechanization and flat across-the-board wage increases have reduced the differentials to minimal significance. While differentials still exist, U.M.W. has virtually accomplished its historic policy of wage uniformity. The period from 1943 through 1948 was a turbulent time indeed in the history of collective bargaining in the coal industry. A detailed account of these troubled times has been placed in the record, but it would serve little purpose to recount these details here. Suffice it to say that although wage increases were negotiated and the welfare fund was established during this period, there were seven national strikes or work stoppages during the period, accompanied by five Federal Government seizures and operation of the mines, and two Taft-Hartley boards of inquiry certifying the necessity of miners returning to work. In addition, there were injunctive, contempt and unfair labor practice charges and proceedings against U.M.W. by both the Federal Government and the coal operators alike. In 1946 criminal and civil contempt fines of $3,500,000.00 and $10,000.00 were imposed upon the Union and its President respectively. The Supreme Court affirmed these fines after reducing the $3,500,000.00 to $700,000.00. In 1948 contempt fines totalling $1,420,-000.00 were imposed upon the Union and its President. It was during the period of government seizure and operation in 1946 that the U.M.W. Welfare and Retirement Fund was first established, the agreement sometimes being referred to as the “Krug-Lewis Agreement”. A royalty of 50 per ton was established to finance the Fund. Adding to the problems of the industry was the fact that in the post-war years a slackening of demand for coal produced a coal surplus. The market was shifting during this period, not only to other fuels but also within the coal industry. Whereas the Class I mines (those producing in excess of 500,000 tons per year) had supplied approximately 50% of the market during the war years, with the drop in demand for coal following the war, their share of the market dropped to 41.5% in 1947, 38% in 1948, and 29.3% in 1949. 1950 Collective Bargaining The plaintiffs lay substantial emphasis upon statements made by John L. Lewis at the 1948 U.M.W. International Convention as being indicative of the conspiratorial motives or purposes then upon the Union’s mind. These statements relate to the unstable condition in the bituminous coal industry, the problem of over production, the failure of management to give any unified or stabilizing leadership to the industry and the suggestion that “If the operators of this country cannot give any leadership upon the commercial side of this industry, the United Mine Workers of America can and will”. Mr. Lewis then suggested the three-day work week as a means of equitable distribution of work opportunities. The significance of this can only be judged in the light of all of the evidence, particularly that related to the 1950 contract negotiations. The 1948 collective bargaining agreement expired or was terminated by its terms on June 30, 1949. Negotiations were held in three separate conferences: one at Bluefield, West Virginia, with the Southern Coal Producers’ Association; a second at White Sulphur Springs, West Virginia, with northern operators; and a third with captive mine owners. These negotiations went on from May through November with nó results. Following termination of the 1948 agreement and throughout the prolonged negotiations for a new contract, the Union applied a three-day work week east of the Mississippi River. The Union contends that this was merely a bargaining device in the nature of a limited strike. The plaintiffs contend that it demonstrated a Union concern to share the work opportunities among its members, which concern was surrendered by the Union as a part of the conspiracy with the northern operators which culminated in the 1950 National Bituminous Coal Wage Agreement. There is nothing in the record, however, to indicate that the three-day work week was anything other than a bargaining technique. Its continuance was never an issue bargained for. Rather, the bargaining centered around the union shop, the limitation of welfare fund benefits to U.M.W. members and the clauses giving the Union control over working time, that is the so-called “able and willing” and “memorial period” clauses. The deadlock on these issues resulted in a Taft-Hartley injunction against the Union. A further injunction, brought at the instance of the Federal Government under the National Emergency Provision of the Taft-Hartley Act, ordered the Union to bargain in good faith. A contempt action thereunder was eventually brought against the Union and its President. It was under these conditions, and in compliance with these injunctions, and within two days after the President of the United States had asked Congress for legislation to permit seizure of the mines, that an agreement was finally concluded with the northern operators on March 5, 1950 — an agreement known as the “National Bituminous Coal Wage Agreement of 1950”. In short, the 1950 Agreement was negotiated under intense national interest, intense publicity, and intense supervision by and pressure from the Federal Government. It is this agreement that the plaintiffs contend was the inception of the conspiracy between the U.M.W. and certain large coal operators to eliminate or suppress competition from the small coal operators. It is alleged that the wage scale and welfare fund royalties were set at a level so high that only the large mechanized mines, or mines readily capable of being mechanized, could meet them. It is true that the 1950 Agreement was negotiated between the Union and the northern operators, with the representatives of the large mining interests being the chief negotiators for' the operators. It is also true that the Court must consider the evidence as a whole and not fragment the 1950 negotiations from the evidence as a whole in determining the existence of an antitrust conspiracy. The Court can only say that upon the evidence to this point, it can discern no evidence of any incipient Sherman Act conspiracy. Certainly the testimony of the principal negotiators for both the Union and the operators is emphatic to the contrary. To conclude inferentially otherwise on the basis of the wage scale negotiated is to engage in unwarranted speculation and is to disregard the undeniable right of the Union to seek to gear its wage scale to the ability to pay of the soundly solvent and not the marginal producer, of the ability to pay of the stronger and not the weaker coal operators. As stated by the United States Supreme Court in the case of United Mine Workers v. Pennington, 381 U.S. 657 at 665, 85 S.Ct. 1585, at 1591, 14 L.Ed.2d 626. “The union need not gear its wage demands to wages which the weakest unit in the industry can afford to pay.” To conclude inferentially otherwise on the basis of statements of Union officials and operator spokesmen favoring stability in the industry is to equate stability to a Sherman Act conspiracy and instability to Sherman Act policy. The circumstances of the negotiations as outlined above give no support in reason to such a conspiratorial inference. Rather, quite to the contrary. COLLECTIVE BARGAINING FOLLOWING 1950 But, as correctly urged by the plaintiffs, the picture must be viewed as a whole, and not in isolated segments. The developments following 1950 must now be looked to, for the picture on the national scene took a much more tranquil course than in the turbulent 1940’s. In June of 1950 the Bituminous Coal Operato