Southern Motor Carriers Rate Conference v. United States

Southern Motor Carriers Rate Conference and North Carolina Motor Carriers Association, Inc. (the rate bureaus) (defendants) were private groups whose members were motor common carriers from four states. In each of those states, the rates for intrastate transportation of commodities were set by a state agency, the Public Service Commission (the commission). Each state required common carriers to submit proposed rates to the commission for approval. While the commission had ultimate authority over the rates, if the commission took no action on the rate proposals within a specified period of time, the rates proposed by the private common carriers went into effect. Each state permitted the common carriers to come to an agreement on a price proposal among themselves and submit a joint rate proposal to the commission. Joint submissions were not required by the states, but the commissions encouraged the practice on efficiency grounds. The rate bureaus acted on behalf of their members to submit joint rate proposals to the commissions. Bureau members were not bound by the joint proposal and could submit independent rate proposals. The federal government sued the rate bureaus, alleging that the joint rate proposals constituted a conspiracy to fix transportation rates in violation of the Sherman Act. The district court entered summary judgment for the government and enjoined the rate bureaus from their joint-proposal activities. The court of appeals upheld the ruling, and the rate bureaus appealed to the United States Supreme Court.