## Facts

- The United States prosecuted 23 corporations and 20 individuals engaged in manufacturing and distributing vitreous pottery plumbing fixtures.
- Defendants were members of the Sanitary Potters’ Association and collectively controlled over 80% of U.S. production and distribution of the relevant products.
- Count 1 alleged a combination in interstate commerce to fix and maintain uniform prices for sanitary pottery.
- Count 2 alleged a combination to restrain interstate commerce by limiting sales to a favored group of “legitimate jobbers.”
- A jury in the Southern District of New York convicted defendants on both counts and imposed sentences under the Sherman Act.

## Issues

1. Whether the trial court was required to submit to the jury whether the alleged price-fixing agreement was an “unreasonable” restraint of trade.
2. Whether the trial court’s instructions on venue and jurisdiction were erroneous where it stated overt acts were unnecessary to constitute the offense.
3. Whether asserted evidentiary rulings and other trial errors required reversal.

## Decision

- The Supreme Court reversed the court of appeals’ judgment and upheld the convictions based on the price-fixing count.
- The Court held that an agreement among competitors controlling over 80% of the market to fix and maintain uniform prices violates the Sherman Act whether the prices were reasonable or unreasonable.
- The Court rejected the argument that the jury had to decide the reasonableness of the price level; the existence of a horizontal price-fixing agreement itself established the prohibited restraint.
- Any deficiencies tied only to the second count did not require reversal because the sentences were partly concurrent and did not exceed what could have been imposed on either count alone, and the record did not indicate that the verdict on the first count was tainted by evidence introduced solely for the second.
- On venue, the Court recognized that if the indictment does not charge formation of the conspiracy in the district, jurisdiction requires proof of an act in furtherance in that district; however, the lack of a specific venue instruction was not reversible error because defendants did not request it and the jurisdictional facts were not disputed.
- Alleged evidentiary errors did not justify a new trial where they did not affect matters of substance in light of the record as a whole.

## Legal Principles

- A horizontal agreement to fix and maintain prices is unlawful under the Sherman Act without inquiry into whether the resulting prices are reasonable.
- The “rule of reason” does not require a jury to assess reasonableness where the charged restraint is direct competitor price fixing.
- A Sherman Act conspiracy is punishable as an agreement; however, when formation is not charged in the district, venue requires proof of at least one act in furtherance occurring there.
- In multi-count convictions with overlapping sentences, errors affecting only one count may be disregarded when another count is sufficient, properly submitted, and independently supports the judgment, and there is no indication of spillover prejudice.
- Technical evidentiary errors that do not affect substantial rights do not warrant reversal.

## Conclusion

The Court held that competitor price fixing is condemned by the Sherman Act without regard to the fairness or reasonableness of the agreed price level, and it reinstated the judgment based on the properly submitted price-fixing count while treating asserted venue and evidentiary defects as non-prejudicial on the record.


United States v. Trenton Potteries Co., 273 U.S. 392 (1927)