The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1911-12-06

foil company is divided into two. one
OF sSz5uvV capital and the other of
ttoV,oe9. The one snun company Is
ul'iucd into three Companies. one with
Il capital Of Slo.VJU.vvV, another with Il
capital of SS.uuo,UuV, and n third VITA
q capital of se,vo0,0p0. The licoricc
companies are TWO, one with a capital
Of So,,oe,3J0 and another with n cap
ital OF >2,ru0.vpy There is, also, tho
iiritish--imerican TOBACCO Company, d
British corporation. doing business
the Porto Rican Tobacco Company,
with capital OF Sl,SVU,0GO, and the
corporation OF United Cigar stores.
with capital of s9,0uo,00v.
Under TINS arrangement, each of the
different kinds of business will be dis.
tributed between two or more o1m-
panies. with division OF the promin-
ent brands IN the same tobacco pro-
ducts, so as to make competition not
only possible, but necessary. Thus tho
ing-tobacco business OF the coun.
'ry is divincd so that the present in
dependent companies have 2l.39 per
cent, while the American Tooacco
Company will nave 33.oS per cent the
Liggeu & Meyers zoos per cent, the
Loriilard Company 22.Se pera Gent., ana
the Reynolds Company 2.6S per cent
The stock Of the other thirteen com
panies, bota preferred and common, has
been taken from the defendant Ameri-
can Tobacco Company and has been
distributed among It's stockholders
All covenants restricting competition
nave been declared null and further
performance OF them has been enjoin-
cd. The preferred stock OF the diIter-
cnt companies has now been given vot-
Ing power, which was denied IL under
the OLD organization. The ratio OF the
preferred stock 10 the common was as
IS to 40. This constitutes a very de-
cidcd change in the character OF the
ownership OF
pany.
In the original suit there were TWEEN
ty-ninc defendants who We're charged
with being the conspirntors through
whom the illegal combination acquired
and exercised It's unlawful dominion.
Under the decree these defendants Will
hold amounts OF stock in the various
distributec companies ranging from Al
per cent as maximum to Isl. per
cent. as minimum, except III the case
OF one small company. the Porto Rican
Tobacco Company, in which they will
hold 40 per cent. The twenty-nine in
dividual defendants arc enjoined for
three years from buying any stock eN-
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
perpetually from in any way effecting
any combination between any of the
companies 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
cnjoined from having common direc-
tors or oiicers. or common buying or
selling agents. or common officcs. or
lending money to each other
Size of New Companies.
Objection was made by certain indie
pendent tobacco companies that this
settlement was unjust because ii left
companies with very large capital in
active business and that the settle
ment that would be effective to nut all
on an equality would be division of
the capital and plant of the trust into
small fractions in amount more near
~ equal to that of each of the indie
pendent companies. This contention
results from Il misunderstanding of the
antitrust law and its purpose. 1t is
not Intended thereby to prevent the
accumulation or large capital in bust
ness enterprises in which such COM
bination can secure reduced cost of
production, sale, and distributions 1t
Is directed against such an aEgrega-
is that OF stiilins competition. enhanc-
ing or controlling prices, and cstab-
fishing 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
'tOhIScutiOu Not the purpOSc of the
statute.
II is not the purpose of the statute
to eonfiscate 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 lis
goods in transportation. are provided.
but the proceeding in equity is a spe-
cihc 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 nccrec.
venture to say that not in the his
tory of American law has Il decree
more effective for such u purpose been
entered by n court than that against
the Tobacco Trust AS Circuit Judge
Moves said In his judgment approving
the decree:
THE extent to which it has been ne
cessary to tear apart this combination
and force 1t into new forms with the
attendant burdens ought to demon
strate that the Federal antitrust sta
tute Is drastic statute which accom-
plishes effective results; which so long
as 1t stands on the statute books must
be obeyed, and which can. not be dis
obeyed without mourning far-reachinp
penalties And. on the other hand: tho
successful Sreconstructiop of this orga-
nizatloIS should teach8that the effect of
enforcing this ! fli fnf 4 n "A