Arizona republican., 1911-12-06
~ mace parties 10 il. ana NUMBER
I,..,.. fo,IrtnaI.
NJ, new duO OIu, fourteen.
Situation and Read justment.


Situation and Readjustment.
| The American Tobacco company
(oldD. readjusted capital. S92. OOO. 900:
! the Liggett & Meyers Tobacco COM
pany new. capital. $4,000 900; the
p Lorillard company new, capt
tai s4..000.0OO; and the r. j. Rey-
nolds Tobacco company (old) capt.
| tai $1,525, 900. are chiefly Engaged in
| the manufacture and sale of chew
ing and smoking tobacco and cigars.
| The former one tin-fOil company is
! divided into two. one of $685., capt.
/ tai and the other of s4OO. 600 The one
! snuff company is divided into three
/ companies. one with capital OF sl5,-
/ 600 900. another with a capital OF
| $S.00O00O and a third with a capital
Of SS,0OOOO0. The licorice companies
! are two. one with capital Of S.
| $4,000 and another with a capital of
! $2.000.000. There is. also, the British
american Tobacco company. a British
corporation. doing business abroad.
with capital of $4,000 O0O. the Porto
Rican Tobacco company. with a capt.
| tai OF sl.SOO.0O0 and the corpors-
ton of United Cigar stores with a
capital of 100000
! Under this arrangement each of
| the different kinds OF business will
] he distributed between two or more
! companies with u division Of the
prominent brands in the same to-
| bacco products. so as 10 make conf
petition not only possible but nee
! ossary. Thus the smoking tobacco
business in the country is divided
so that the present independent COM
| panies have 2l.3S per cent. while the
J American Tobacco company viii
| have i@.OS per cent, the Ligg-tt 4
MeNres zoos per cent. the LOriilard
company 22.S2 per cent and thu
Reynolds company 2.66 per cent The
stock Of the other thirteen COM
panics. both preferred and common.
has been taken from the defendant
| American Tobacco company and has
been distributed among its stock
holders. All covenants restricting
competition have been declared null
and further performance of them
has been enjoined. The preferred
stock OF the different companies has
now been given voting power which
vas denied il under the old Organi-
cation. The ratio OF the preferred
stock 10 the common was - to 40.
This constitutes a very decided
| change in the character of the own
ersh.p and control OF each company
In the original suit there We're
twenty nine defendants who were
charged with being the COnspirators
through whom the illegal combination
acquired and exercised its unlawful
dominion. Under the decree these
defendants will hold amounts of stock
il, the various distributed companies
ranging from II per cent as maxi
mum 10 IS IL per cent as a mini
company. the Porto Rican Tobacco
company. in which they will hold ~
| Fer cent. The twenty nine individual
defendants are enioined for three
years from buying any stock except
from each other. and the group H.
thus prevented irom extending its
control during that period All par
ties 10 the suit. and th. new COM
panies who are made parties. are en-
joined perpetually from in any way
! effecting any combination between
any az the companies i'm violation OF
the statute by way Of resumption
o. the old trust. Each OF the fourteen
| companies is enjoined from acquir-
ing stock in any of the others All
these companies are enjoined from
having common directors or officers,
or common buying or selling agents.
or common offices. or lending money
to each other.
Effectiveness Of Decree.
| venture 10 say that not in the
history OF American law has a de-
cree more effective for such pur-
pose been entered hi a court than
that against the Tobacco trust A..
Circuit Judge Noyes said in his
Judgment approving the decree:
The extent 10 which it has been
necessary To tear apart this cOmbin-
alton and force il into new forms
with the attendant burdens ought to
demonstrate that III. federal anti
trust statute is a drastic statute which
accomplished effective results; which
so long a. il stands on the statute
! books must he obeyed and which
cannot he disobeyed without incur
ring far-reaching penalties. And. on
the other hand. the successful re-
construction Of this organization
| should teach that the effect of en-
| forcing this statute is not To destroy.
tut In reconstruct: not to demolish.
but TO re-create in accordance with
| the conditions which the congress
has declared shall exist among tbs
/ people Of the United States"
New Remedies Suggested.
| Much is said of the repeal of this
statute and of constructive legisla-
ton intended to accomplish the pur-
| pose and b'az. clear path for hon
est merchants and business men 10
! follow. IL may be that such j pla;
viii he evolved. but | submit that tho
discussions which have been brought
out III recent days by the fear Of the
continued execution Of the antitrust
law have produced nothing but gilt
tering seneralities and have offered
| 90 line of distinction or rule OF
action as definite and as clear as that
| which the supreme court itself lays
down in enforcing the statute
Supplemental Legislation Needed
Not Repeal or Amendment.
| | see 40 objecton-and indeed
can see no decided advantagta-in
in the enactment Of a law which shall