New-York tribune., 1906-06-19
UBACC0 MEN INDICTED
THO PRESIDENTS HELD.
FMeraI Grand Jury Finds against
T7oO Trust Concerns.

rbe investigation of the Tobacco Trust. which
,,s been going on several months before the fed
IS grand jury. resulted yesterday in indict-
-snrs against the MacAndrews & Forbes Com
..nv II this city; the John s Young Company
: Paltimora and the presidents Of both COM
.,,ss Karl JunEbluth and Howard f. Young
- indictments charge violation of the anti
,-gst laws in monopolizing the licorice paste
--5e IN this country for the benefit of the To-
hs,co Trust
warrants on the indictments were granted
Yesterday by Judge Laoombe. on the application
= Henry- ". Taft and Felix H Levy, who have
sssn conducting the investigation for the gov
s-nnert hut no arrests will be made Follow
.r the precedent in the sugar rebating cases
- indicted corporations viii appear only by
,o,Dsel. while Mr. Jungbluth and Mr. Young will
-ske personal appearances and give bail to-
-a-ow Judge Lacombe decided yesterday that
har q 5000 must be furnished in each case
=. Iancey olicol and John D Lindsay will rep
,sert the defendants.
ccavic1ion On the indictments would subject
Re two companies to fines not exceeding 5000
sd the two presidents to similar fines and pos
sble Imprisonment for one year. It is probable
fiat trial on the indictments viii be delayed by
notions 70 dismiss, and in any case the trial
syai3 not take place for several months
is set forth in the indictments that the MAG
andrews & Forbes Company and the John S
Young Company controlled So per cent Of the
Hoorloe paste manufactured in this country
The paste is used extensively in the manufacture
Z. Plug and smoking tobacco. snuff and cigars.
Independent tobacco companies complained more
than q year ago that they were being deprived
q sufficient supplies OF the paste at reasonable
Ircss on account Of the monopoly, and the in
Tsstgatiou was the result.
n the course Of the investigation e. E Hale
secretary Of the AtacAndrews & Forbes Com
rany refused 70 obey a subpoena and produce
csrain books and papers Of the company. He
YES a65udEed IN contempt, and the United
sztes Supreme Court decided that he must obey
us subpoena and produce the books.
Contracts and letters quoted in the indict-
nsuts TO show that the AacAndrews & Forbes
Company and the John s Young Company en-
ared Into an a asreernent with John D. Lewis, Of
i7.zfderce. and the Weaver & Sterry Company.
o. his ciry 10 advance prices of Hcorice paste
70 consumers not in the Tobacco Trust and that
mere was an arrangement whereby the indie
pendent consumers were 10 be supplied by Lewis
and the John :. Young Company, while the
trust was 70 be supplied by the MacAndrews &
Fo-tes Company In the arrangement Lewis
vas 70 lirrit his sales Of paste 10 100000
"01 each year for FIVE years.
i Has part Of the plan that the Tobacco Trust
was 10 get nine-terths OF all the licorice paste
sod while its independent rivals should get only
one-tenth BY the terms Of a contract the J. S.
Young Company was to receive the annual profit
on 10000 cases Of paste, whether the paste
s5d TO The independent consumers or not. The
letters show that orders of independent tobacco
lZnUfacuurers for paste were scaled down in
l+I4 when the manufacturers We're trying to get
additional supplies in anticipation of a rise in
prices. In June. 1904. Henry NJ Rau agent for
the John :. Young Company, wrote TO John D.
Lewis.
j. J. Bagley & Co. have sent US an order for
tUo hundred cases. TO which We have replied
thar The need Of taking care Of the requirements
q large number OF customers, and our being
Al this time without any stock on hand, will
force us 10 scale this order 10 fifty cases for
present shipment. 10 which We ask their consent
We th--k il would be well 10 treat all such or
Gers which evidently anticipate requirements
FOR many months ahead, in the same way; and
should Doe glad 10 have you advise US of any
0rseIs OF Ike character which reach you II
VIII surely initiate against our being able 10
make contracts q little later on if in the mean
tine vye take away the inducement TO contract
ny permitting certain customers TO stock up
very heavily.
On August - Of the same year. Rau wrote 10
Lewis.
Al q oonference held to-day il was decided as
Ire best policy attempt 70 obtain contracts
t0r John D. Lewis and the J. s. Young Com
fauy from all the independent tobocco manu-
iscturers. barring, of course those V ho are stiil
Under old contracts either with one of US or
With the NacAndTews & Forbes Company TO
THIS purpose u. & 7. viii hereafter confne the
SAFE of their product 10 factories affiliated with
ihe American and Continental Tobacco COM
ialias which factories viii doubtless require
ihe entire product OF The NJ d F Co This was
'h- ultimate purpose IN view when the present
trtansculeuus We're contemplated, and the ac-
ton which NJ * T. viii take in case Of any
orders from the parties referred 10 will be ef-
tec-ive
-a The same letter Lewis was told TO go ahead
aid make contracts for the sale Of his paste at
- Gents "a pound 10 large consumers and 1o12
cents pound 70 small consumers Previous TO
ihe combination, as the Letters show. the paste
had been selling at cents a pound. Rau had
the following 10 say about the higher prices 10
knall consumers:
These prices TO very small consumers are 10 be
Effective II once and you should notify your
agent CT ageucs at once arrl state at the same
Ciae that in "a few days you Will have contracts
y '-tT me more important customers at some
1-7- lower price than lorz. In the mean time
you cannot accept any new orders for some days,
OF perhaps r. week ahead. allowing you time TO
se- lhe contracts out You understand that these
Saa- buyers VIII not be able 10 get their sup
I3es elsewhere, as n & F viii have none to
sfi them anyhow.
IN the course Of the investigation Mr.. Taft tried
. force the secretary Of the MacAndrews &
'oroes Company 10 supply 2 copy Of a letter
written by President Jungbuth, which was
ate6ed link IN the chain Of evidence Of the
.NsIirar3- and the argument was advanced on
'+1st ~ The government that the refusal to