The times., 1901-05-10
INDUCEMENTS TO JoBBERs
The Tobacco Trust Charged with
DISCRIMINATING in sections.

American Tobacco Company and inde-
pendent concerns in the tobacco industry
The United States company. he said. was
engaged IN the manufacture of smoking
and chewing tobacco. New England was
the principal market for the products OF
the United States Company. though a nor
tion of their goods was sold throughoux
the country. The export trade was small.
The condition which Mr.. Campbell pro.
tested against, amounting 10 a practical
restraint of independent trade by the To-
baceo Trust. was the result Of agreements
made by representatives of the trust with
retailers and jobbers in the Northeastern
States. Prior to the formation of the
United States Company. the Continental
Company, trust concern, manufacturing
the same class of goods as the United
states Company, practically controlled
the entire Northeastern trade When the
United states Company encrOached on the
New England trade OF the Continental
Company the latter company offered Job
oers and retailers IN that territory per
cent and later 5iz per cent to handle only
trust made goods If the iobber refused
to enter into such an agreement he was
not allowed to handle trust made goods.
As the Continental COmpanys brands
were better known and constituted n
great part Of the jobber's trade he was
forced to accept the terms of the trust
or go out of business. Owing 10 this con-
dition of affairs. Mr.. Campbell said. MANY
retailers had refused 10 handle tobacco
manufactured by the United States Com
pany' resulting in a decided injury to
their business.
The antitrust law Mr. Campbell person.
any considered imperative as tar as the
al faesrN of
described was concerned. The contracts
mentioned between the trust and the re-
tailers were merely verbal agreements,
and there would be great difficulty in get
ting evidence of discrimination and result
ing restriction Of trade. The simplest rem
edy lay in governmental legislation. If the
books of corporations whose stock was
listed on the stock exchange were sub
1ected to examination in the same manner
as those of national banks, and a general
supervision over the operations of such
corporations We're exercised by the Gov
ernment, conditions detrimental to COM
petition could not exist, and the jObber
retailer, grower, and consumer would all
be benefited. 1t should also be made i'm
perative as a part of such legislation
that goods of the same grade be sold at
the same price in different sections of the
country. thus doing away with prohibitive
10 kill competition.
j. NJ. Duke. of New York, President OF
the American Tobacco Company, in an
swer TO questions by members of the Com
mission along the lines of the allegations
made by Mr. Campbell, entered a general
ien1dI or the charges of discrimination
n the New England States. Mr.. Duke
;aid he knew of no agreements. verbal or
otherwise, relating TO the sale of trust
made goods only by retailers in that sec .
ion. In fact, ne said. no representatives &
II the company We're empowered, or al
owed, to make agreements Of such a
lature with jobbers- If such agreements
we're in force IL was without the knOwl-
dge or authority Of the officers of the
Ompany.
The jobbers and retailers. he thought,
lad made up the story of the threats of
andling of goods they did not want and
or which there was no demand. Under
ormal conditions prices were generally
INFORM throughout the country He ad-
1itted that in certain sections cigarettes
ad sold, at times since the passage Z
he war revenue law. for 81. 80 thousan
r the amount of the tax on 1000 cig
cites under the law. This amounted e,
wing the goods away. and WAS fer the
urpOse. Mr.. Duke said, of introducing
new brand or an old brand into new
erritOry.
Mr.. Duke denied that competition could
q killed in this way. The fact that the
merican Tobacco COmpanys goods
hight be sold a a very low price to -
alters would not kill competition If il.
endent concerns could put on the mar
Gods which caught the fancy of the
C. He reiterated his statements ~
o agreements had been made with \
.ngland retailers TO sell only trust made
oods.
John Landstreet. Vice President of the
nited States Tobacco Company, who fol-
)wed, quoted a number of affidavits of
)bbers in New England, setting forth
substance that they had been approach
i by representatives of the Continentai
obacco Company and offered induce
tents to sell trust made goods only He
lSo read copy of a letter from the Con-
mental Tobacco Company to a New Eng
md JObber, referring in general terms y
, proposition that had been made to
i'm TO reap an additional profit by hand
ng only the goods of the Continental
ompany.
A number of retailers who had refused
he inducements of the trust, and who
ad continued to handle independent
OodS, Mr.. Landstreet said, had had their
rderS to the Continental Company ig-
ored. One dealer who was thus refused
oods and who wrote 10 the Continental
ompany asking the reason why he was
ut of. was told in q letter a cOu1- Of
hich Mr. Landstreet read, that the Con-
mental Company did not consider il 10
s interests to have any business dealings
18th him; The brands made by the trust
)mpr1Sed the greater part of the New
ngland trade II was absolutely neces-
Try that the retailer handle its goods in
der to do profitable business.
a large number OF the retailers an
reached by the trust accepted it's nrOp-
;ition, and those who did not were ObIie-
TO go into other States for trust
'ands, the Continental Company refus-
g to NIL their orders. Still other Job
RS, Mr.. LandStreet said, who had ac-
pted It's offers, sold the goods of the 4
nlted states Company and other fnde-
,ndent concerns Surreptitiously When :
customer asked for an independenr
and. Mr.. Landstreet said such dealers !
Ould look around fearfully as if thew
sre dbout 10 commit crime and then
eah out the desired brand from under
e counter. or from such other Out Of
e way place To those retailers the
1ited States Company was Obliged TO
lp Its goods in plain cases without anv
5TkS which would serve to idenfff,- tTe
htents as the product of an indaDeu-
Mt concern. When things had come to
en- a pass that dealer sold a non-trust
ana OF tobacco with precisely the same
llty air with which he would picE n
ck, or commit theft. and with lust
much fear for the consequences. il was
rtdlnly time for remedial legislation
II. D. Lee. Treasurer of the American
'bacco company, testified on the same
les as did Mr.. Duke. He reiterated Mr..
Ike statements that the officers of the
mpdny knew OF no agreements between
g Continental Company and the iobbers
d retailers looking TO the exclusion Of
g products of independent concerns
pm New England territory He admit
L. however, that as Treasurer Of the q
nerlcdn Tob2cco Company he was not
position to know officially of any
ch agreements, which would originate.
at all. in the sales department.
fhe American Tobacco Company. Mr..
e said. had never paid any attention TO
Dor unions. If representatives OF such
ions had any complaints to make they
ire received by the proper officer Of the
muars- and accorded every cOnSideTa-
N. The American Tobacco Company. :