The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1897-06-16
THE TOBACCO KINGS
Their First Days Trial For
Conspiracy.
Mr.. OLCOTTS KEEN KNIFE
HE EXPOSES SCANDALOUS
METHODS.
COULD NOT SELL OTHER GOODS
Such Was Testimony of Park and llllford
Who Had to Give up Even $4,000 OF
National Cigarettes Under Threat
of the Monopoly.

National Cigarettes Under Threat
of the Monopoly.
New York. June 15.-Judge Fitzgerald
TODAY decided that the trial of the Ameri-
can Tobacco Company's officers should
proceed with the jury originally selected.
w J Bryon, against whom certain charg-
es of indiscretion were made, remains
Juror. Judge Fitzgerald, when the pro-
ceedings began, denied District Attorney
Olcott's motion to have Mr.. Bryon re-
moved. He also denied a motion made
by Lawyer Choate to have Juror Fash
examined in regard to his interview with
Reporter Piper.
Mr.. Choate then said that he would
demand to have the attention Of the
grand jury called to Reporter Piper, the
editor and proprietor of the Morning
Journal and advertiser, for having en-
gagged in conspiracy TO influence the
action of Justice against the defence.
District Attorney Olcott then opened
the case for the prosecution. Mr.. Olcott
told of the formation of the company.
He said:
..Prior to October IL, 1889, there were
FIVE great cigarette manufacturing con-
Germs, Allen & Ginter, w. Duke Sons u
Co, Kinney Manufacturing Company,
w. S. Kimball & Co., and Goodwin N
Co. They had ninety per cent. of the
trade. These five concerns came togeth-
err" Mr.. Olcott claimed that Allen d
Ginter and w. Duke Sons " Co. each
took thirty per cent; Kinney Tobacco
Company twenty per cent. and kimball
& Co. and Goodwin & Co. each ten per
cent.
1.-THE American Tobacco Company was
Incorporated January 20, 1890, IN the
State of New Jersey. No crime was COM
mittad by that corporation, but 1 will try
to show you that the methods declared
and carried out under that agreement OF
incorporation were crime.
.Those five concerns maintained their
separate establishments and continued
to make and sell their individual brands,
but when a bill of goods was sold, say,
for instance, by Allen IL Ginter, the bill
was made out from Allen Il Ginter,
Branch of the American Tobacco Com
pany.'
This is most significant. 1t shows
that this corporation was not formed to
conduct a cigarette business as an Or
binary corporation composed of lndlyldu-
ais, but was a corporation OF corpora
tons. not to start a cigarette business,
but simply from their aggrandized power
TO restrain, aye to strangle compeu-
ton.
'They sent a circular to the tobacco
trade saying that discount of a certain
percentage would be made to the job
bers who bought of the branches.
''Any jobber? Oh! No; but any job
Der who handles cigarettes in satisfac-
tory manner.
Satisfactory to whom? Satisfactory
to the manufacturer. Men with money
and credit and business reputation could
not buy the goods of the American To-
bacco Company unless, in the opinion of
the company, they handle their goods in
a manner satisfactory to the company.
This means, plainly, that these goods
must be sold at any price fixed by the
company. No matter what the situation
of the jobber may be, no matter how
much he may need money, or how much
he may wish to clear out shop-worn
stock. by disposing of his goods a. a
price lower than the cost, he cannot
do it.
people cOIlTOI Ulltt9 pcI tcnt.
of the cigarette trade of this country.
This means that nine out of ten cigar
cite smokers want the cigarettes made
by the American Tobacco Company and
unless a jobber handles these goods he
can sell only to one ont of ten customers
and he cannot handle the American To-
bacco Compay's goods except 1T their
terms"
Mr.. Olcott then took up the provisions
of the agreement. One was that the sell
ing prices should be such as the tobacco
company fixed, Agents, he said, We're
obliged to guarantee sales. Real agents
do not do this. All cigarettes were to re-
main the property of the company. The
company agreed to pay all freight charg-
es. The agents were to have guaranteed
the company against loss by fire. This
was another unusual proceeding. The
agent agreed to pay all charges, lnclud-
ing taxes and license fees.
"There is nothing that could not be
covered up under the statute laws if
such trickery was allowed to go unpun-
ished,' said Mr.. Olcott 'This is the sys-
tenn under which the American Tobacco
Company disposed of its goods from
March /, 1892, up to the time of its in
dictment The company was not indicted
for striving to overcome competition by
fair means, not for using its grasp on 90
per cent. of the cigarette trade, but be-
cause it used its power over unwilling
idbbers to prevent them from selling
other cigarettes"
Joseph Park, of the grocery firm Of