New-York tribune., 1908-11-08
AGAINST TOBACCO co.
CASE TO BE APPEALED.
Gopernment S Contention Partly Up
held an Anti-I'ruSt Sat

! antitrust act Judges Lacombe, Noyes ana coke
rendered separate opinions upholding the govern
| ments case Judge Ward wrote dissenting opin-
| ion. The suit instituted more than a year
! ago and many months consumed in taking
| testimony
In the suit prosecuted by James c. McReynolds
| and Edwin P. Grosvenor. special assistants to the
| United States Attorney General, the government
asked for injunction dissolving the combination
OF the American Tobacco Company and its sixty
subsidiary companies, on the ground that 1t was
illegal and operated in restraint OF trade and
merce. The government also asked for the ap-
pointment Of receivers to wind up the affairs Of
| the allied corporations
The four judges agreed that the governments
bill should be dismissed [ the United Cigar
Stores Company. British-American Tobacco Com
pany and the Imperial Tobacco Company, and that
there should be receiyership for any Of the
companies. While the court finds violation OF
the Sherman law, and that a injunction should
issue against some of the defendants to prevent
the continuance of the violation. the decision clears
the American Tobacco Company Of the charges
Of pursuing dishonest oppressive practices The
issuance Of the injunction viii be withheld until
the United States Supreme Court has decided the
appeal which the defendants will surely make to
that tribunal.
Judge Lacombe referring to the antitrust act as
"a drastic statute" says in his decision;
There can be little doubt that the federal statute
has been violated The claim that the formation
the original American Tobacco Company ante
garded. but the present American TOBACCO Com
Peny es threw the consolidated company out Or OUS'
The statements concerning benefits accruing
markets abroad is in3nateriaI. Each one Of the
purchases of companies complained OF in the Pc
ttion was a contract and combination in restraint
oT competition existing when it vas entered INTO: p
of this drastic statute.
Relation between defendants is not material
The petition should be dismissed as TO the I'm
perial Tobacco Company and the British Tobacco
Company. As to the receivership asked for, such
scheme seems impracticable and is wholly IN
necessary. I concur with Judge Coke in his rea-
Stores company and the s9u r. Rc6ardson % E
company. and agree that issuance Of Injunction
peal.
Judges Lacombe Coke and Noyes hold that as
the provisions OF the Sherman antitrust law make
every combination Illegal the act Of the American
Tobacco Company in purchasing & competing
Germ is illegal As Judge Lacombe says further in
his opinion:
Size is not made the test: two individuals who
Villages into contiguous states who enter into
conbtnatio TO join forces and operate single
seem make little difference whether they make
nership not.
A noteworthy feature Of the decisions Of all four
judges is the absolving of the defendants from
oppressive injurious or unfair practices. As to
this, Judge Laconbe says:
The record in this case does not indicate that
there has been any Increase IN the price OF tobacco
persuasive evidence that by unfair competition or
improper practices Independent dealers have been
pss to the G prncps 1P endan dG pnrng
@ me existence OF the american tobacco G9rnpaXI pI
caRital-in competition with it, and have thriven.
for 9ne PTf PsFqmd m Gf abnor2 532 S0ndoR% a has
the same time l5O,O0O addlClonal acres nave oeeI!
devoted to tobacco crops and the consumption Of
enteprse f mas Of @ the d@aedant @ and at large Expense
opened or developed in India, China and elsewhere
The opinions OF Judges Noyes and Ward are
equally emphatic in their exoneration Of the
American Tobacco Company from the charges Of
oppression Judge Ward differing from his col
leagues questions Of law, says IN the course
of his opinion:
a perusaI Of the records satisfies me that their
purposes and conduct were nor Illegal or op-
man strives to increase their business. and that
their great success is q natural growth resulting
less largely helped by the volume Of business done
and great capital at command
Judge Noyes makes statement in his decision
that IS significant in view Of the agitation for the
amending of the antitrust law. In this connection
| he says:
It may be that the present anti trust statute
those combinations which unreasonably restrain
trade-that 1t should draw line between those
work for evil But these are all legislative. and
! borne in mind that this court has nothing to do
| with the wisdom, justice or expediency Of the
| statute
Another phase Of the courts decision is found
| the economic arguments of Judge Lacombe, who
| says:
When we remember the circumstances under
! which the act passed the popular prejudice
against large aggregatiOns Of capital and the loud
| outcry against combinations which might in one
way or another interfere 10 suppress or check the
| full, free and wholly unrestrained compettlog
%hlch was assuIle9 rlgltLy ST VI PIoLsIy, 10 pe
the very life Of trade. II would not be surprising
! to find that Congress had responded TO what
| seemed to be the wishes of a large part. if not
| the majority. Of the community and that It m
tended to secure such competition against the
The act may be termed revolutionary because
! before its passage the courts mad recognized a
fair, permissible. although It operated in some
measure to restrict competition BY lnsensioIa De
| ness manufacturing and trading alike, has more
and more developed a tendency toward larger and
con1binat lions of individual enterprise
II is nded that, under existing conditions in
cheapened new markets opened and developed,
stability in reasonable prices secured and INDUS
indiyiuals or corporations form merly independent
immediately upon its formation terminates an ex-
petition subsequently arise Inc act as aoQve
construed prohibits every contract or comonaton
in restraint of competition
George 7 whalen. president of the United Cigar
Stores Company. said last night The decision
handed down today by the United States Circuit
Court while holding technical violations Of sections
of the Sherman act against the American Tobacco
C,,n7nanv although it found its business methods
20 be free of criticism, completely aosolved our com
pany from any violation, techTica al or otherwise
A complete perusal Of the decision shows there
Is absolutely no criticism OF our company and its
a-.+ions and saws that its success lis the pre-
MUM which has always been awarded to earnest
and intelligent endeavor
SAYS PUBLIC FEARED DEMOCRATS.
M-+i, W IjttIeton Discusses Recent Elec-