## Facts

- Moore, president of the Odd-Lot Cotton Exchange of New York, sought access to continuous New York Cotton Exchange (NYCE) cotton price quotations via ticker service provided by telegraph companies.
- NYCE operated a cotton futures market in New York City using open bidding on the exchange floor; prices were compiled as quotations at NYCE’s expense.
- NYCE had a contract with Western Union under which NYCE supplied quotations and received annual payment; Western Union transmitted quotations to recipients approved by NYCE under anti-redistribution and anti-bucket-shop conditions.
- The Odd-Lot Exchange applied for ticker service in the required form, but NYCE refused to approve it, asserting concerns that the Odd-Lot Exchange was a cover for unlawful “bucket shop” activity.
- Moore sued seeking cancellation of the NYCE–Western Union agreement, an antitrust/monopoly declaration, and a mandatory injunction compelling delivery of quotations to the Odd-Lot Exchange.
- NYCE counterclaimed that the Odd-Lot Exchange was wrongfully obtaining and using NYCE quotations through unauthorized channels and sought an injunction to stop that conduct.

## Issues

1. Whether claimed “unfair competition” relief could be pursued directly in court under the Federal Trade Commission Act rather than first through the Federal Trade Commission.
2. Whether NYCE’s futures transactions and related quotation distribution were transactions in interstate commerce such that the Sherman Act applied.
3. Whether the NYCE–Western Union quotation contract constituted an unlawful restraint of trade or monopoly under the Sherman Act.
4. Whether federal-question jurisdiction existed when the federal antitrust claim ultimately failed on the merits.
5. Whether NYCE’s counterclaim for injunctive relief properly arose out of the same transaction as Moore’s suit under Equity Rule 30.

## Decision

- The Supreme Court affirmed the decree dismissing Moore’s complaint and sustaining the injunction in favor of NYCE on its counterclaim.
- Any claim for “unfair competition” relief under the Federal Trade Commission Act was required to proceed initially before the Federal Trade Commission.
- NYCE exchange transactions for future delivery, centered on local contracting and local delivery obligations represented by New York warehouse receipts, were local and did not constitute interstate commerce; potential interstate shipments were incidental.
- The NYCE–Western Union agreement to distribute quotations to recipients approved by NYCE was not a Sherman Act violation and did not directly or unreasonably restrain interstate commerce or create a monopoly.
- The complaint invoked federal jurisdiction because its federal statutory claim was not wholly insubstantial; dismissal was on the merits, not for lack of jurisdiction.
- NYCE’s counterclaim to enjoin wrongful acquisition and use of quotations arose out of the same transaction as Moore’s demand for compelled quotation service and was properly entertained.

## Legal Principles

- Relief under the Federal Trade Commission Act for unfair competition must be sought first through the Federal Trade Commission, not by an original equity suit.
- Exchange-floor contracts for future delivery that are made and to be performed locally, with delivery obligations tied to local warehouse receipts, are local transactions even if performance may later involve interstate shipments.
- An exchange that collects and sells its price quotations may control distribution to approved recipients; selective distribution is consistent with the ordinary rights of a vendor of news.
- A telegraph company transmitting such quotations as a carrier may be limited by the seller’s designations of authorized recipients without creating an antitrust violation absent direct and unreasonable restraint of interstate commerce.
- A federal statutory claim that is legally insufficient still supports federal-question jurisdiction if it is not wholly insubstantial or frivolous; rejection of the claim results in a merits dismissal.
- A counterclaim seeking to protect the same subject matter and course of dealing at issue in the complaint may be treated as arising out of the same transaction for purposes of Equity Rule 30.

## Conclusion

The Court upheld NYCE’s right to sell and restrict access to its price quotations, held that the underlying exchange transactions were local rather than interstate commerce for Sherman Act purposes, required FTC Act unfair-competition claims to begin at the Commission, and approved an exchange’s counterclaim to enjoin unauthorized use of its quotations as arising from the same transactional dispute.


Moore v. N.Y. Cotton Exch., 270 U.S. 593 (1926)