California Associations Deny Allegations

Complete denials of guilt w;th regard to all the allegations made against them in the ,complaint recently filed by The Federal Trade Commission, has already been made by the six California retail lumber organizations named as defendants in said complaint. The answer of the defendants was made through their attorney, Morgan J. Doyle, of San Francisco. They were allowed until September 18th to file such answer, but did so immediately without waiting for the time limit.

The defendants and officers named in the complaint were as follows:

California Lumbermen's Council, George N. Ley, president; Charles G. Bird, vice-president; George C. Burnett, treasurer; L L. Walker, secretary and manager, and Ley, Bird, Burnett, J. H. Kirk, Warren Tillson, S. P. Ross, I. E. Horton, A. S. Hatch, E. S. M'cBride, and James Tully, councilmen.

Coast Counties Lumbermen's Club, Wiley Masengill, president; W. H. Enlow, vice-president; J' H. Kirk, treasurer; and C. S. Tripler, secretary and manager.

Central Valley Lumbermen's Club, C. C, Morehead, president; W. O. Mashek, vice-president; Charles G' Bird, treasurer. and Thomas L. Gardner, secretary and manager'

Northern Counties Lumbermen's Club, George K' Adams, president; E. S. McBride, vice-president; and C. D' LeMaster, secretary and manager.

San Joaquin Lumbermen's Club' George C. Burnett, president; F. Dean Prescott, vice-president; Ralph P. Duncan, treasurer; and Bernard B' Barber, secretary and manager.

Ofifrcers of the r:espondent Peninsula I umbermen's Club, also defendants, were not listed in the complaint.

The next move in the matter will be the setting of a date for a hearing of the matter, whi'ch hearing will presumably result either in the dismissal of the charges or the issuance of a "Cease and Desist" order by the Commission.

The complaint ,charges that the respondents have entered into an agreement among themselves to p'romote their volume of business ancl profits, and for the purpose of making their program effective have engaged in various practices which include: Compelling manufacturers and producers to refrain from selling lumber or building materials to so-called "illegitimate" dealers who are not members of the respondent organizations and association, and to force such "illegitimate" dealers to purchase their requirements exclusively from or through the respondent members on terms of sale whi'ch will ac'cord a profit to such respondents; inducing manufacturers and produ,cers to discontinue selling to "illegitimate" dealers and to limit their sales to the respondents; denying membership in the organizations to dealers who refuse to abide by the respondents' program, and; fixing schedules of uniform prices, the prices thus established being enhanced beyond those that would prevail under normal competition and in the absence of price agreements.

The ,complaint further charges that the respondents, for the purpose of making their program efie'ctive, exact promises from the members of the respondent organizations and from manufacturers and producers that they will adhere to the program; use effective ,coer,cive action and threats of boycott to require manufacturers and dealers to sttpport the program; inform manufacturers and producers of the respondents' determination to insist that they distribute their products exclusively through the medium of the respondents, and deny or revoke membership in the respondent associations to dealers who fail to abide by the program.

The complaint further charges that as a result of the respondents' alleged conspiracy to control and influence trade in lumber and building materials, the cost of such products is enhanced to pur,chasers with a resultant incr'ease in the cost of construction, repair -and maintenance of homes, buildings, highways, and all kinds of construction and building work; that employment in the building and construction industry is restricted and the purchasing power of users of lumber and building materials reduced; that competitors, not members of the respondent organizations, are discriminated against and eliminated from the field, and that trade is diverted from them to the respondents.

The above is a definite outline of the charges as stated in a press bulletin on the subject issued by the Federal Trade Commission, and these charges have been denied in toto by the respondents.