Unit Rate Upheld

When a Louisiana federal court found the New Orleans Times-Picayune (circ. 175,000) and its afternoon sister, the States, guilty of unfair competition, more than 170 papers all over the U.S. viewed the situation with understandable alarm. The court had upheld the trustbusters' charge that the papers' unit ad rate (forcing advertisers to place ads in both papers if they wanted space in either one) was a violation of the Sherman Antitrust Act (TIME, June 9, 1952). Other publishers who also use the unit rate feared that the decision against the T-P and States would upset an advertising arrangement that had been in effect on many other papers for years. With the support of these publishers, T-P and States Publisher Leonard K. Nicholson appealed the decision to the U.S. Supreme Court.

This week, in a 5-4 decision, the U.S. Supreme Court overruled the verdict against the T-P and States, declared that the unit rate used by the papers was not in violation of the Sherman Antitrust Act. Although the Government had argued that the T-P and States system "forced" a rate on advertisers, the Supreme Court ruled that the Government failed to prove unfair competition. Said Justice Tom Clark for the majority: "We do not determine that unit advertising arrangements are lawful in other circumstances or in other proceedings. Our decision adjudicates solely that this record cannot sustain the Government's view of the case."

Since this left it up to the Government to prove in each case that the rate resulted in unfair competition, it looked as if newspaper publishers could relax.

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