The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1899-06-10
STANDARD OIL METHODS
MORE TESTIMONY HEARD By THE
INDUSTRIAL COMMISSION.
Theodore Davis Tells of His Expert.
ence with the Big Monopoly-T.
n. Westgate's Evidence.

WASHINGTON, June 9.-Ex-State Sena-
tor Theodore Davis, of Ohio, was the first
witness before the Industrial Commission
to-day. He is both a producer and refiner
of petroleum, located at Marietta. and his
testimony dealt with the operations Of the
Standard Oil Trust and the Argand Oil Com
pany. He complained of the discrimina-
tons of the railroad companies, saying that
managers of some Of the roads were inter-
ested in rival companies, which were so
favored that his company had been COM
PEELED to suspend business. This discrimina-
ton was also practiced by the pipe line
against producers who did not control these
lines In such cases they were also unable
to secure fair rates from railroads. forcing
the conclusion that the railroad companies
were concerned for the success Of the pipe
lines. Mr.. Davis said the Standard nad
been able to come into the control or most
of the producing area, and this was accom-
plished through cooperating companies He
said as a refiner he had purchased consid-
cradle oil from the Standard, and that it
was the custom of the Standard to charge
I'D its losses of oil by fire, leakage, etc.. in
any given district to the purchasers in that
district, distributing the loss among them.
He also said the Standard had such close
relations with the railroad companies and
so completely controlled the markets as TO
render it almost impracticable for any re-
finer to enter on the manufacture Of such
products as lubricating oil. He said that
on one occasion shipping clerk of his firm
had been approached by the Standard COM
pany and offered money for information as
to the business of the concern. This scheme
had failed, owing to the fidelity OF the clerk,
but the firm became satisfied that the Stand
ard had information of every barrel shipped
by his house. Every shipment was followed
up and the consignees approached with
offers of oil at lower rates. The competitors
also resorted to duplicating his brands,
sending out under them inferior articles Of
oil. The competition had at last become so
fierce that his house had been compelled
to go out of business.
Mr.. Philips asked Mr.. Davis If 1t was not
fact that the profits of the Standard were
not greater on each barrel of oil sold than
the cost of the article, but the witness de-
clined to express an opinion on this point,
saying he did not know. 1t was fact, he
said, the Standard had purchased several
refining plants and had then dsmantled
them. but he was not prepared to say that
such refineries were well enough located to
render 1t profitable to maintain them. Nor
was he prepared to say that any oil COM
pany was engaged in practices which any
other would not resort to to get business
under the same circumstances.
Mr.. Davis was followed by Mr.. T. U. West
gate, an oil refiner at Titusville, Pa. Among
other companies in which he is interested
both New York and Philadelphia the Stand
ard had reduced the price Of oil Immediately
on his company entering the field, and that,
owing 10 this reduction, oils were nov be-
ing sold in both markets at prices which
render the business improbable. Mr. Davis
declared that the Standard managers kept
strict account Of all the oil sent out by
rivals. His company was In the habit of
general policy was to try 10 get only a
small percentage of the business In each
place. and he had found that so long as he
pursued this plan prices could be held up,
but tnat If he endeavored to increase the
quantity prices were Immediately reduced,
with the intention of driving him out of the
field. Mr.. Westgate had no doubt that the
Standard company knew each morning just
what his shipments had been the day be-
fore. He could not say that the railroads
supplied the information. but he knew that
told of instances in which the Standard had
made efforts to entice his men from him.
and also Of threats in cases where the COM
petition was sharper than the Standard COM
Mr.. Westgate said the railroads had been
very careful about giving rebates since the
interstate-commerce laws enactment. but
he was satisfied they favored the Standard
company by underbilling and he cited in
stances convincing witness that there was
an understanding between the railroad
companies and the Standard. BY this means
and by changes in freight rates so as TO
suit the purposes of tho Standard and injure
its rivals. the field of independent operators
was being steadily reduced RAILROADS did
not seek the trade of the independent COM
panies, which. IL favored as the Standard
was, could prosecute a fiercer opposition.