The morning times., 1897-02-24
The Wholesale Gr0cers' AsS0ci-
alton Adopted Its Schedule.
THE TOBACCO COMBINATION
President James Is. Duke Admitted
That 1t Discharged Several Hun
dred Men and That Dealers who
DO Not Handle Its Goods Cannot
Make Much Money


q. Waldo Smith. president Of the Whole
sale Grocers' Association. was the first
witness. He said his association was not
| incorporated, and extended through New
York, New Jersey, Connecticut New Hamp-
sie ana Vermont He denied that his as
| sociation controlled the prices OF sugar in
any way. He said that previous To the
formation of the Wholesale Groccrs' AsSo-
cation the grocers lost money by selling
sugar. He declared that the Wholesale
Grocers' Association had nothing to DO
with the making of code OF rules fixing
the price or sugar on an equality. Witness
said that grocers all over the cuuatry
adopted the prices of the American Sugar
Refining Company as the stan dard.
Mr.. Smith said his firm bought goods
from the American Sugar Refining Com
| pany, and from the Mollenhauer Com
paEy.
And you get the same discount from
both companies"
Yes, sir"
Then the product of the Molleuhauer
Company is fixed by the quoted prices of
the American Sugar Refining Company"
Il have no knowledge Of any such
thing"
=
Yes, daily, as telegraphed by our bro
kers''
Now said Senator Lexow, rising in
| his seat and handing Mr. Smith copy
OF the factors agreement, Il am sorry
we Should know more about your business
| than you do"
MT. Smith examined the document care
fully, and said:
''Ai that is in that agreement is that
i we made an affidavit o naiutaint the piice
sugar.
Now let me show you the affidavits
YOU make. Do these afiidavits not state
the conditions on which you receive the
suagr?''
mo, sir, We found we We're handling
sugar at net cost, which means ruin. We
| went TO the sugGr Iefineries. They said
now we VIII give you Il list Of cur Gus
toners, and if you can get 80 per cent of
| them TO ask for what you want we Will
grant it,
Witness declared that combinations were
| benefit to the consumer and to the trade
He denied that the Grocers' Association
| was atail TO the kite of the American Sugar
| Refining Company. lis not the sale OF
| sugar absolutely essential To the success
| of the jobbing business? - asked Mr..
Lexow.
Yes, sir; It is''
Hence a factors making or unmaking
depends on his securing a factors agree
ment from the American Sugar Refinery
| and its allies?''
Yes, SIR
Therefore the making or unmaking OF
| wholesale grocer depends upon the grant
ing of factors agreement by the sugar
refineries?"
Witness admitted such was the case, and
saiG if the factors agreement was with
| dawn there would be wholesale competi-
ton and universal ruin.
rs it not fact that you are building
| up an instrument for the perpetua ton or
| a monopoly by the American Sugar Re
| filming Company by means of this factors
agreement?'
mo, sir; for the reason that capital can
come in at any time and break up the
combination
james b. Duke, president Of the American
| Tobacco Company, was the next witness.
He said the company was organizedin in New
| Jersey.
How many companies were organized
| into the American Tobacco Company?''
There were fiye-W. Duke, Sons & Co,
Cl DuGndill, y. - AIiell " uiHler, Oh hlcfl-
mond, Va: W. S. KimbaIl & Co, of Roches-
ter; Kinney Tobacco Company, New York;
| Gordon & Co, of New York The COM
panies We're Incorporated in 1S9O.''
why did YOU organize in New jersey
because the laws for that thing are
| more favorable"
you were organized?''
hot III
| the names Of nine concerns.
Since You organized have you been
manufacturing in New JerSey?"
No, sir
Are all the factories Incorporated run
ning?"
Nc, SIR
How many are closed?'
Goodwin * Co, the Hall factory, the
Consolidated Cigarette Company, and, 1
think, another
How manymenwere discharged through
| the closing of the Goodwin company, OF
New York;"
Il can't say exactly, about 100, prob
ably"
How many were discharged through
the closing OF the Hall factory in New
York;"
Probably 100"
Were there not 45O or 500 girls and
men discharged?"
Il can't tell exactly
sHow many were discharged when the
Consolidated Cigarette Company was closed
down."
Il am not sure"
Were there 300?''
Il can't tell, probably about that num-
ber.''
The witness stated that the Ellis factory
in baltimore was also closed but another,
larger factory was opened.
What proportion of the men discharged
in New York were re-employed?''
Il think nearly all of them were re-
| employed
do you operate under a factors agree
| ment?''
mo, sir, we call ours consignment
agreement.
A copy of this was produced and placed
| in evidence.
In reply to another question the witness
said that the firms organized controlled
from so TO 80 per cent of. the cigarette
trade.
How many competing companies We're
left at the time of the organization?''
About one hundred
The witness said that the agreement
| referred to the sale of cigarettes.
You have this agreement with whole.
sale grocers?''
Yes, SIR
us it a fact that the greater number of