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Judicial Tolerance of Farmers' Cooperatives, 38 Yale Law Journal 936 (1929)


A decade and a half of judicial tolerance has been ended by a decision of the United States Supreme Court unfavorable to farmers' cooperative associations. A legislative act declaring the ginning of cotton to be a "public business" has been made to invalidate another act of the same legislature providing for the granting of permits to gin to cooperatives upon the petition of "one hundred citizens and taxpayers of the community." It is held by the Court that since the business is public, it cannot be entered without a license; that in form and purpose the association is a corporation; and that the legislative prescription of different conditions to individuals and "corporations" as a requisite for licenses is a denial of "the equal protection of the law" guaranteed by the Fourteenth Amendment. The judgment of the Court is alike of immediate import and of future significance; it necessitates the revision of tactics now employed in the conduct of cooperative associations; it may well lead to basic changes in the prevailing form of the organization or seriously retard the advance of the movement. An understanding of the meaning and import of the rule of law implicit in the decision demands a brief account of the ends, the forms, and the legal status of the cooperative association.

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