Connolly v. Union Sewer Pipe Co.

Background

The Union Sewer Pipe Company, a business organized in Ohio and operating in Illinois, sued two Illinois buyers who had bought Akron sewer pipe and then refused or failed to pay. The buyers said the seller was part of an illegal combination and relied on three defenses: common‑law rules against trusts, the federal Sherman Act, and an Illinois 1893 trust law that made certain combinations illegal but exempted agricultural producers.

Reasoning

The Court first explained that a seller’s prior involvement in a combination did not let a buyer refuse to pay for goods bought under separate contracts; those sales were collateral to any illegal arrangement. The Court then focused on the Illinois statute and its ninth section, which exempts agricultural products in the hands of producers. The Court held that this exemption created an arbitrary and unconstitutional classification that denied equal protection under the Fourteenth Amendment, because it punished many traders while protecting farmers for the same conduct. The Court found the exemption inseparable from the rest of the law, so the whole statute was invalid. The Court affirmed the lower courts’ rulings for the seller.

Real world impact

The decision means buyers in Illinois cannot rely on the 1893 trust statute to avoid paying sellers for goods, and sellers can enforce their sale contracts even if the seller was tied to a combination. The ruling also limits state laws that single out favored groups for exemption; states must apply regulatory rules evenly to similar businesses.

Dissents or concurrances

Justice McKenna dissented, arguing the legislature could reasonably distinguish farmers from other traders and that courts should give legislatures wide leeway in classification.