New-York tribune., 1909-04-06
Oil ARGUMENTS BEGIN
Federal BRIEF FILED.
Frank b. Kellogg 4rrGigns STANDARD
at st. Louis.

CT evidence taking ia The governments suit to dis
solve the Standard OH Company Of New Jersey for
alleged violations Of The Sherman act
The brief asserts that the various defendants nave
from the iTsl pursued system Of unfair compe-
ts9on against their competitors, whereby the inde-
pendent companies selling and marketing petroleum
have either been driven out Of business or their
business 50 restricted that the Standard Oil Com
pany has practically controlled the prices and
monopcli@ed the commerce in the products of pc
troleum in The United States. This system. il is
conteneed. has taken the form Of price cutting In
various places. while keeping Up high prices or
raising them stil higher in others where no com
petition exists: Of paving rebates to customers as
part Of their system of price cutting; Of obtain
ing information as competitive business,
largely through bribing railway employees and using
Their secret Information procure the counter
mandur Of orders f independent producers. and
10 facilitate the price cutting policy. Of the Of
so-csIled independent companies, that companies
held out by the Standard OIL Company indie
pendent. which are engaged in price cutting. while
the Standard coil Company maintains the price
through its sVeI known companies and other
abusive eomnpetitive methods against competitors
petitors
The STANDARD Oil company. the trief alleges. is
particularly able carry Ola predatory competition
for the that il does not eli its product
central markets or through ordinary channels.
other ordinary manufacturers II markets
IT'S products to the retailer III every village and
community IN The United States. and il sells di-
TeCftN 70 The consumers u does from TO 81
cent Of the business OF the United States. leaving
about 10 10 Il per cent for all its competitors 1t
also held that the testimony in the Standard
OIL prosecutions shows that that company. through
company in which il a majority Of stock
Qthe GaIena Signal on Company. also controls
about s7iz PEI Of the lubrication railroads
throughout the United States. and that sells
most railros ds enormous profits. This is eVi-
dences bt the net earnings Ol the company. which
In 1906 about IL per the capital stock
E~7 ffr- r.-FE
valuation of the capital used II is also shown by
The further fact thai the prices these railroads
are substantially double the prices charged 70
few favored lnes. notably the Pennsylvania. For
instance. the brief says. the New York Central
Railroad for wears has paid about 100 per cent
Pc gallon more than the Pennsylvania II is also
stated that wherever the Standard can dc so if has
made contracts whereby il has either marketed
part ali Of the product Of the independent re-
hnersz- has limited the output of the same.
EARNINGS OF *lco0ne0.
one Of the evidences Of the monopoly OF the de-
PENDANTS il is charged. * its enormous earnings.
These earnings summarized follows: The
STANDARD Oil Trust and the Standard Oil Company,
on an investment Of s6s0244so, had earned up %
the end of 1906. SS3S 7S5.7S3 Adding estimated
proits Of 1sG7 and 1905 We have substantially the
brief states, billion dollars earned by this
pany in tWenty-seven years. with original in
vestment OF SEE s,0,e0e.
Further the brief says:
N TINS country that they have increased business
and decreased the cost 20 the consumer but in the
Of the Standard oil Company il has during
he -etsje- and fbie a a5nod deal nor ,tan ,be
prices Of other products throus ot the country al
though the price of its raw material and cost of
erased very ifie if any y's eSe eaiS H.
II is stated that during the years from 1874 10
lsS2 the Standard obtained Of practically all
the pipe Zines then existing aud brought them
together the control Of the National Transit
nd has 1glr n
destroy competition in pipe lire business
sought control the tidevater pipe company. then
The oniy pipe line the seaboard. ami succeeded
in getting an agreement with that company for d.
vision Of the business.
Through this and other agreements with other
companies and purchases the STANDARD. is alleged.
has thu present time control Of about per
cf the Transportation of crude oil to the Atlantic
seaboaro. which bV reason Of the large percentage
Of oil exported gives il q tremendous adHanta ge.
Recognizing the importance the Standard Of
Rey transportation its officials md their associates
during the las years. it is said, have been
directors in many Of the leading railroad systems
81 jlie United States For instance. the Standard
interests have N Chicago. Milwaukee St Paul
four directors, Union and Southern Pacific and
Santa PC two each. and New York New Haven &
Hartford New York Central and allied lines. Mis-
souri, Pacific. Boston & Maine, Wisconsin Central.
Rutlsnd Railroad and others. one each The brief
continues:
The government does not wish 70 be understood
sgairst legitimate cofpetition but if the Sherman
dn6o @ sea9rsd bI IN sae S nehod Of Of eope
tioH a pursued by the Standard Oil Company.
Unless II Is enforced the small corporation in
divldual who wishes engage in business will
Inony Is valuable as shoxing the intention Of the
Standard Oil Company TO monopoiZe the commerce
tricts il has absolute monopoly. We mean by
absolute monopoly that in those districts it does
petiuor- Practically. this is The throughout the
eeasi states The percentage Of independent busf-
ness throughout the entire South is small.
petitors are usually strictly Inder the control Of
lowed 30 90 business; sell oil at practically the
selves 10 a small percentage Of the trade.
Mr. kELLoGG's ARGUMENT
Mr.. Kellogg began his argument with rather
full review OF the evidence taken By the govern
nnent. He told Of the combination effected by
John o. Rockefeller. William Rockefeller and
Henry NJ. Fgagler in 1879. conceived. he declared
20 effect moSopoly of the petroleum trade both
domestic and export. Ii was at that moment
cerding the federal lawyer, that the alleged
illegal conspiracy 10 monopolize the oil trade Of
the country conceived. Later said Mr.. Kel-
iogg. Henry T. Rogers John .. ArchboId. Oliver
II Payne and Charles NJ Pratt taken into
the conspiracy by the other defendants
In closing. Mr.. Kellogg read at length from a
decision rendered by William H Taft in the Ad-
syston pipe case when judge in Cincinnati. Isle
issue An The case involve was alleged restraint
of trade The federal lawyer hurried through his
argument to-day. promising 70 conclude his re
marks al noon tomorrow. leaving mis- associate
c. z. Morrison. finish with argument cover
ing the alleged unfair competition or the defendant
AS OF the four judges Of the court is TO leave
ST. Louis Saturday. Mr. Kellogg will insist on
the defence's completing its argument on Friday.
This would leave John G. Milburn New York:
Eoritz Rosenthsi. Of Chicago; John @. johnson.
PhilaSel phis. and David @. Watson. of PiItsburg
tEo and half hours each open their defence
with Friday for the Standards concluding argu-
osaSS r-sz. f. -aTTc 5a