The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-05-11
Paper Makers'Combination Sur
renders to the Government.
Will Compel Association to Go
Out Of Business.
FINED FOR CONTEMPT
Witnesses Had Refused to
Answer Questions.
Expected That Competition Will
Now Be Restored.
FINED FOR CONTEMPT

st. Paul, Mimi, May 1.-THE United
States government today secured an
unconditional surrender in the United
States circuit court, before Judge San
born of the paper trust against which
the attorney general began suit on
December 81, 1904, to dissolve a combi-
nation between the General Paper COM
pany and % other defendants on the
ground that an agreement had been en-
tered into by the defendants in restraint
of interstate commerce.
Attorney Kellogg for the government
and Attorney Flanders. for the defend
ants appeared before Judge Sanborn
sitting as a circuit judge and Mr.. Kel-
logg moved that the mandate from the
United States supreme court affirming
the order that the witnesses must teSt1-
fy be filed.
Judge Sanborn ordered the mandate
fled The witnesses then appeared be-
fore the United States examiner and
withdrew their answers. Mr.. Kellogg
announced that the government did not
care to examine the witnesses and
moved for a decree in favor of the
that the decree be entered for the gov
ernment for the relief prayed and that
the decree should be settled on June 16,
and the proceedings We're adjourned
The three witnesses who refused 10
testify namely, c. I. McNair, Of the
Northwestern Paper company; A. G.
Bossard, Of the Itasca Paper company,
and B. F. Nelson Of the Hennepin Pa
per company, paid into court the 500
fine assessed against each for contempt
of court for refusing 70 answer the
questions put to them at former hear
ing.
Suit was brought by Frank B. KEEL
logg and James NJ. Beck, special assist
1 ant attorney generals of the United
| States on behalf of the United States
and 23 paper manufacturing corpora
| tions in Wisconsin, Minnesota and
/ Michigan. a little over a year ago The
complaint alleged that the defendants.
/ in violation of the provisions OF the
/ Sherman act entered into an agree
ment combination and conspiracy
with each other to restrain trade ana
/ commerce among the several states
and to control. regulate and monopo-
/ lie said commerce and that this was
/ accomplished by organizing the gen
| eral paper company of Chicago with a
4 capital stock of 100000 divided into
1000 shares of 500 each which stock
1 was divided among the paper manu-
/ featuring companies in proportion OF
i their average daily output of paper;
i that each of the corporations thereon
! entered into a, contract making the
/ general paper company It's exclusive
! selling agent The defendants filed an
| sWers and testimony was taken for
showing a combination was elected
/ from the officers Of the various de-
/ fendant companies. Finally the de-
! PENDANTS refused to furnish any fur
ther testimony or to answer any ques-
/ tiOns on the ground that the test1-
mony would tend to criminate the wit
nesses and the corporations and on
/ the ground that the testimony was ir-
I revelant and immaterial. The case
went to the supreme court of the
{ fot nd a 0y7
the End of January in connection with
/ the Tobacco case
4 In both the paper case and the tobacco
case. the question argued and decided
was that witnesses We're not exempt
/ from answering on the ground that the
/ testimony would tend to criminate the
/ corporations. The supreme court neld
that the evidence was clearly material
that bin Of complaint charged an an
1 lawful combination and conspiracy and
/ that the testimony tended to show it.
/ The decision in this case really left
nothing for the defendants to do but to
submit to Judgment and today they ap-
1 peared In court, withdrew their answers
and thereupon judgment was ordered
for the government as prayed in the bill
/ of complaint
This is a complete victory for the gov
I ernment and the general paper com
pany will be compelled to go out of bus
! mess. The price of paper at the time
this suit was brought was from s2.25 to
50. 80 per cwt The bringing of this suit
already has had the effect of reducing
the price of paper to about $1s5.
The result has been very beneficial to
the newspaper publishers throughout
the country. Competition will now be
restored between the various mills.
Mr.. Moody Explains.
Washington. May 11.-Attorney Cen
eraI Moody, upon being questioned con-
corning the significance of the action of
the defendants in withdrawing their an
swer to the governments bill in the so
called paper trust case today at St. Paul
said:
This action on the part Of the consti-
tuent companies of the paper trust
terminates the litigation by the entry of
a judgment for all the government de-
manded in its bill and Is complete VIC
tory for the United States. They manu-
/ facture substantially the sole supply Of
news print and fibre paper of the dis
trict of Chicago and east of the Rocky
mountains
During the summer and autumn of
1905 large amount of testimony was
taken which tended to show the ex-
istence of the illegal combination as
charged in the bill. During the tax
ing of testimony certain of the defend
ant corporations refused to exhibit
their books and answer questions on
the ground that such evidence was i'm
material and 1t would tend to incrimi-
nate InSnl- HTOceeQingS were there
/ upon Instituted in the United States
district court of the Eastern district OF
Wisconsin and in the United States cir
cult court for the district of Mime
sofa to punish for contempt for refus-
ing to produce books and ansszv er
/ questions. These cases We're argued In
the supreme court of the United States
on the second day Of January, 1905
with the case Of Hale versus Henkel
commonly known as the Tobacco
involved in the paper trust case that
were involved in the tobacco trust case