Los Angeles herald., 1910-03-10
DECLARES TRADE
IS CRUSHED OUT
BY OIL OCTOPUS
Federal Counsel Exposes
Methods Employed
by Standard
REBATING IS SHOWN
Enforce or Repeal Sher-
man Act Say Lawyers
for Government
ASSOCIATED Pressl
tAssoclated Press1
w ASHINGTON, March 9.-"Either
w the Sherman act should be re-
paaIad or II should he aOfOpppd

w the Sherman act should be re-
pealed or it should be enforced
in manner to make people respect it,"
With this declaration the department
of justice today filed with the federal
supreme court a thousand-page brief
in support of it's petition that Stand
ard Oil be dissolved as in violation of
the Sherman antitrust law. The brief
will be the foundation of the govern
ment's oral argument at the hearing
next Monday. 1t bears the names of
Attorney General Wickersham and of
Frank B. Kellogg, with c. B. Morri-
son and c. A. Severance as special
assistants. III 4Sa8skl
One of the two volumes of the brief
is devoted to an analysis of testimony
taken in the circuit court for the east
ern district of Missouri, which de-
creed that Standard Oil be dissolved
1t represents years of governmental in
vestigation of the oil business.
The government declares this testi-
mony shows rebates and discrimina
tory rates were received by the Stand
ard Oil combination, not only during
it's formative period, but during the
last ten years, whereby the Standard
was enabled to bring a large part Of
the concerns into the combination and
to crush. cut and eliminate from the
field of competition the principal part
of the balance"
1t is claimed by the government that
it shows a system of lowering prices
where competitors are doing business,
below the cost of production while
raising the prices in other parts of
the country until the competitor is
oFf oil cd his business
brought to such state that the Stand
ard Oil company can control it; of
obtaining secret information as to COM
petitive business, largely through brib-
ing railway employees, and using that
secret to procure conutermand1ng or
ders of independents and facllltate
their system of price cutting and OPP
preston; of the use of the so-called
bogus independent companies, whose
operations are predatory and oppress-
i've principally to drive out competi-
ton, and various other means"
What Sherman Act Means
1--WE do not wish to be understood as
discouraging enterprises" says the
government "or as being against le-
gitimate competition but if the Sher-
man act means anything in this coun-
try, it means a monopoly acquired by
such methods of competition as this.
tion or individual who wishes to engage
in business will have absolutely no
opportunity at all.
"In many districts the Standard Oil
has an absolute monopoly. We mean
by absolute monopoly that in those dis
tricts it does all of the business and
has eliminated every competitor Par
ticularlv this is the case throughout
the Rocky mountain and most of the
Pacific coast states. The percentage
of independent business throughout
the entire southern states is very
small"
In the second volume is a so-called
summary of facts and brlef OF the
law.
Repeated statements are made of the
attitude of the government toward or
ganized business. 1t is urged that If
the intent is clear to monopolize any
part of the commerce of the United
States the scene is void in whatever
form the action is taken.
"The oft-repeated argument that
this construction of law prevents Tor
nation of partnerships and the legltl-
mate consolidation of business enter
prises," says the government, lis falla-
cious. for such construction has no ap-
plication where an enterprise is formed
with the honest and legitimate intent
to pursue a lawful business, nor go be-
yond the bounds of legitimate combina-
ton or directly or substantially sup
press competition. Whenever thar
acquisition is a mere cloak to cover
the monopolizing of commerce or 10
strike down competition, it is illegal.
1t follows from this that the acquisition
of the same property might under
some circumstances, be legal, while un-
der other circumstances 1t VIII be
illegal"
Not Competing Concerns
The brief replies to the argument of
the Standard Oil counsel that the cor
porations that entered into the or
ganization in 1899 were not at that
time competing with each other.
"If they were not competing" says
the government, "it was because of an
unlawful combination in the form of
trust. or during the liquidation period,
because of the conspiracy of the IN
dividual stockholders. We have seen
that this trust was void. Certainly the
conspiracy between the stockholders
of these subsidiary corporations was
directly inhibited by the sherman act.
John D. Rockefeller, it is claimed
by the government, testified that after
the trust dissolution was ordered IN
1892 each of the corporations, as con-
troled by it's own stockholders, en-
gagged in its own branch of the busl-
ness of purchasing, refining, transports
ing and selling OIL and that they were
each competing with the other"
Even assuming, the government says,
that there was purchase OF properly
nrevious to 1899. it is maintained that
it is well settled law that where prop
erty is acquired TO suppress competi-
ton the acquisition is void. In support
of this statement the government
quotes at length from an opinion rem
dered by President Taft, then on the
bench.