The Denison review. [volume] (Denison, Iowa) 1867-current, 1911-12-06

are two. one with a capital
of S5,75S3OO and another with capl-
raj of So.OOO.OOO. There is also the
British American Tobacco company.
British corporation. doing business
abroad with a capital Of $26.OOOOOO.
the Porto Rican Tobacco company.
with capital of Sl.S00.OOO. and the
corporation of United Cigar Stores.
with a capital of $9.00O.0o0
Under this arrangement each OF the
different kinds Of business will be dis
tributed between two or more conpa,
mics with division of the prominent
brands in the same tobacco products.
50 as to make competition not only
possible but necessary Thus the
smoking tobacco business Of the coun.
try is divided so that the present In
dependent companies have 21.39 per
cent. while the American Tobacco com.
pany will have 33.0s per cent. the Lg-
gett & Meyers zoos per cent, the Lori]-
lard company 22.s2 per cent and the
Reynolds company 2.66 per cent. The
stock Of the other thirteen companies.
both preferred and common. has been
taken from the defendant American
Tobacco company and has been dis
tributed among its stockholders. All
restricting competition have
been declared null and further per-
Torrance Of them has been enjoined.
The preferred stock Of the different
has now been given voting
power which was denied it under the
old organization. The ratio Of the pre-
ferred stock to the common was as Is
to 40 This constitutes very decided
change in the character Of the owner.
ship and control of each company.
In the original suit there were TWEEN
ty-nine defendants. who were charged
with being the conspirators through
whom the illegal combination acquired
and exercised its unla wful dominion.
Under the decree these defendants will
hold amounts Of stock in the various
companies ranging from Al
per cent as a maximum to 2S3. per
cent as minimum. except in the case
Of one small company. the Porto Rican
Tobacco company. in which they win
hold As per cent. The twenty-nine in
defendants are enjoined for
three years from buying any stock ex-
cept from each other. and the group is
thus prevented from extending its con-
troll during that period. All parties to
the suit and the new companies who
are made parties are enjOined perpet-
ually from in any way effecting any
between any of the com
panies in violation Of the statute by
way of resumption Of the old trust.
Each Of the fourteen companies is en-
joined from acquiring stock in any of
the others. All these companies are
enjoined from having common direc-
tors or officers. or common buying or
selling agents. or common offices. or
lending money to each other.
Size Of New Companies.
Objection was made by certain in
dependent tobacco companies that this
settlement was unjust because it left
companies with very large capital in
active business and that the settle
ment that would be effective to put all
on an equality would be division q.
the capital and plant Of the trust into
small fractions in amount more neay-
~ equal to that Of each of the inGe-
pendent companies. This contention
results from a Misunderstanding O!
the antitrust law and it's purpose. 1t
is not intended thereby to prevent the
accumulation Of large capital in bust
ness enterprises in which such COM
bination can secure reduced cost OF
production. sale and distribution. It
is directed against such an aggrega-
ton of capital only when its purpose
is that of sitting competition. enhanc
ing or controlling prices and establish
ing monopoly. If we shall have by
the decree defeated these purposes
and restored competition between the
large units into which the capital and
plant have been divided we shall have
accomplished the useful purpose Of
the statute.
contiseation Not the Purpose Of ths
Statute.
1t is not the purpose of the statute
to coniscate the property and capital
Of the offending trusts. Methods Of
punishment by fine or Imprisonment
Of the individual offenders. by fine OF
the corporation or by forfeiture of its
goods in transportation are provided.
but the proceeding in equity is spe,
cific remedy to stop the operation Of
the trust by Injunction and prevent
the future use of the plant and capital
in violation Of the statute.
Effectiveness Of Decree.
venture TO say that not in the his
tory Of American law has decree
more effective for such a purpose been
entered by court than that against
the tobacco trust. AS Circuit Judge
Moves said In his judgment approving
the decree:
1.-THE extent to which it has been
necessary to tear apart this combina-
ton and force 1T into new forms with
the attendant burdens ought to demon
strate that the federal antitrust statute
is drastic statute which accomplishes