The Democratic advocate., 1908-11-20
ALL COMBINES ILLEGAL.
Far-Reaehing Effect of Tobacco Trust
Decision.


Decision.
New York, Nov. 15.-The sweeping
character of the recent decision of the
United States Circuit Court in declar-
ing the American Tobacco Company to
be combination in restraint of trade,
is attracting widespread attention in
business circles and among members
of the legal profession who have given
special attention to the trust question,
not so much for it's immediate effect
on the allied tobacco interests, but
more particularly for it's scope and ef-
feet upon all classes of industrial COM
binations engaged in interstate traffic.
All appeal of this decision to the United
States Supreme Court is now in active
progress of preparation by counsel in
the case.
Judge Lacombe, in his majority opln-
ion, defines the status OF the law to-
day as follows
'Disregarding various dicta and fol-
lowing the several propositions which
have been approved by successive ma
jority of the Supreme Court, this Ian
guage (Sherman act) is to be construed
as prohibiting any control or combi-
nation whose direct effect is to prevent
the free play of competition, and thus
tend to deprive the country of the SER
vices of any number of independent
dealers, however small. AS thus con-
strued the statute is revolutionary. By
this it is not intended to imply that the
construction is incorrect. The act may
be termed revolutionary because be-
fore it's passage, the courts had recog-
nized a restraint of trade which was
held to be unfair, but permissible, al
though it operated in some measure
to restrain competition.
BY insensible degrees, under the
operation of many causes, business,
manufacturing and trading alike, has
more and more developed a tendency
toward larger and larger aggregations
of capital and enterprise. 1t is con-
tended that, under existing conditions,
in that way only can production be in
creased and cheapened, new markets
opened and developed, stability in
reasonable prices secured and indus
trial progress assured. But every ag-
gregation of individuals or corpora
tions, formerly Independent, immedi-
ateIy upon it's formation terminates an
existing competition. whether or not
some other competition may subse-
quently arise.
'The act, as above construed, pro-
hibits every contract or combination
in restraint of competition. Size is
not made the test. Two individuals
who have been driving rival express
wagons between villages in two con-
tiguous states, who enter into COM
bination to join forces and operate a
single line, restrain an existing COM
petition, and it would seem to make
little difference whether they make
such combination more effective by
forming partnership or not.
The advance of judicial interpreta-
ton of the Sherman act was also dealt
with by Judge Noyes, who concurred
with Judge Lacombe in the tobacco
decision.
AS to the general character of COM
binations coming within the law, Judge
Noyes says further
"The construction of the statute con-
fines the duty of the court within very
narrow limits. We have only to in
quire whether the evidence shows the
combination restricting competition
There is no necessity for going further.
Other inquiries are immaterial The
combination may not reduce the prices
paid to the growers of raw materials;
may not increase the prices charged to
consumers; may not seek to exclude
all others from the field; may be free
from coercion or oppression-and yet
if it restrict competition-if it restrain
trade reasonably or unreasonably-it
falls within the statute. The statute
declares unlawful every combination
in restraint of trade. 1t contains no
words of limitation or qualification,
and the Supreme Court of the United
States has decided that the courts have
no ri orhtc To attach thana to 1t >,