The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-02-15
CAST-IRON PIPE TRUST
BROKEN BY THE UNITED STATES
CIRCUIT COURT OF APPEALS.
The "COmbine. Restrained from Do
ing Business Under Its Present
Contract of Association.

CINCINNATI Feb 1.-THE United States
Circuit Court of Appeals for the Sixth cir
cult to-day decided the Cast-iron Pipe Trust
case. Mr.. Justice Harlan and Circuit Judges
Taft and Lurton composed the court. Judge
Taft delivered the opinion. The suit
begun in the United States Circuit Court
at Chattanooga by a bill in equity filed by
the attorney general of the United States
against six cast-iron pipe companies-the
Addyston Company, of Cincinnati; Dennis
Long & Co, of Louisville: the Chattanooga
pipe works, of Chattanooga; the South
Pittsburg pipe works, of South Pittsburg,
Tenn. the Admission pipe works, of Annis-
ton, Ala, and the decentralization Com
pany, of Bessemer, Ala.-to enjoin them
from continuing to do business under a con-
tract of association which the bill charged
was q violation of the federal antitrust act
of 1890. because it was in restraint of in
terestate trade in cast-ron pipe and at
tempted monopoly of the same. The Circuit
Court dismissed the bill, and the United
States appealed
BY the contract the defendants divided the
country into free" and pay" territory.
Free territory embraced New York, Penn
sylvania and Virginia and all States north
and east of them. Pay territory embraced
mtory the associates were permitted to sell
pipe at any price they saw fit. All orders
received from pay territory had to be sub
mitted to central board, which fixed the
price and then assigned the job to the as
sociate which would agree to pay to the
others the highest bonus. Certain large
cities were reserved to particular members,
and on orders received from them the price
and bonus were both fixed by the board.
Though the aggregate tonnage capacity of
the associates was only 80 per cent. of
the total tonnage capacity of all the mills
in the country, it was over 60 per cent. of
the tonnage capacity of competing mills in
pay territory By the custom of the trade
all contracts were made to include delivery
by the seller at the home of the buyer.
The Court of Appeals held, first, that the
contract of the association, even If the
prices fixed under it were reasonable, and
its only purpose was to prevent ruipous
competition, as claimed by defendants. was
nevertheless void at common law because
in restraint of trade and an attempted
monopoly; second, that the prices were not
reasonable and the purpose was an at
tempted monopoly; third, that the trade
restrained by the contract of association
was the negotiation and sale of pipe to be
delivered across state lines from the state
of manufacture to the state of sales and
that this was under all the decisions of the
Supreme Court Interstate commerce, and,
fourth, as a conclusion from these prem
ises, that the contract of association was
restraint and burden interstate COM
HleTce ana VOCATION OF the FEDERAL anu
trust act. and should be enjoined. The
court distinguished this case from the Sugar
Trust case on the ground that the contract
sought to be enjoined under the federal
antitrust act in that case was a contract
of association for the manufacture of sugar,
and did not involve, as the contract in this
case did, the restraint of sales of merchan-
disc to be delivered across state lines. The
Judgment of the Circuit Court of Appeals
reversed the decree of the Circuit Court
and instructed that court to enter de-
cree enjoining the six defendants from con-
tinung to do business under contract of
the same.