Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1911-12-21
SUIT FILED,
wednesday, Against The
Keystone Watch Case Co.,
For Violation Of The Sherman
Antitrust Act.
Government Seeks Restraint Of Con-
duct Of Alleged Monopoly,

suit against the keystone Watch case
Co, declaring it an unlawful combi-
nation in violation of the Sherman
anti trust act and asking that 1t be
restrained from carrying on an al
legged monopoly in the manufacture
and sale of watch cases. The govern
ment declares that the company now
Manufactures and sells so per cent.
of all watch cases manufactured and
sold in the United States and that
lit is the intent and purpose of the
defendant that the company shall
monopolize the remainder of the trade
and commerce"
The Keystone Watch Case Co. is a
Pennsylvania corporation. The indi-
vidual defendants named in the bill
are Theophilus Zurbrugg. of River
side, n. J., until recently president OF
the company; Caleb +. Fox, Philadel-
phia, acting president; Edward T.
Stotesbury, Philadelphia, vice presi-
dent; John j. Mueller, Philadelphia
secretary; Charles NJ. Fegg, Philadel-
phia. treasurer; +. II. Kahn, Philadel-
phia, assistant treasurer. and Irving
Smith, New York. director.
The watch industry movement in
the United States is divided into two
parts. watch case and watch move
ment. Of all the watch cases manu-
featured and sold more than 80 per
cent are filled cases.
The bill recites the history of the
alleged combination. 1t is related that
Zurbrugg consolidated two firms of
watch case makers and that they We're
absorbed by the Riverside Watch
Case Co. Zurbrugg and others, the bill
says obtained control of a corporation
named the keystone Watch Case Co,
and all took over all the property of
the old Keystone and Riverside Cos.
in 1889. Later the stock of the New
York Standard Watch Co. was Sc
cured and then control of the prop
erty of the United States Watch Co..
with a plant at Waltham. Mass. and
the Z. Howard Clock Co, the latter
company, thereafter engaging in the
manufacture of watch movements. In
1906 The keystone Co. the government
charges, acquired the Crescent Watch
Case Co, which had previously pur-
chased the entire watch case business
of the American Waltham Watch Co.
the manufacturers of the present Wal
than watch movement and the Bay
State Watch Case Co, of Boston. II
is also alleged that the keystone Co.
acquired 851 of the 2000 shares of the
| American Watch Case Co. of Toronto.
limited. The remainder of the stock
is owned by the Waltham Watch Co,
and the Eigin National Watch Co.
After the acquisition of these shares
"A Canadian corporation known as the
Keystone Crescent Watch Co. OF
Canada, limited, was organized to act
as sales agent of the American
Watch Case Co, of Toronto. The cap
ital stock of the new corporation is
owned by the keystone Co.
In 1904, the government charges, the
Keystone Co. entered into a contract
with the Elgin National Watch Co.
whereby the keystone Co was put in
exclusive charge of the export trade
OF the Elgin Co.. except the trade with
Canixtla:s and in 1909 the keystone Co.
made a similar contract with the
Waltham Watch Co, except in Great
Britain, France and Spain. The
Waltham and Elgin Co.'S" the bill
says. ARE two of the principal manu-
facturers of watch movements in the
United States and their sales to for
eign countries constitute the princi-
pal part of the export trade in watch
movements
and contracts the government asserts
in its bill the Keystone Co. so con-
trolled the trade in watch cases as
to enable il to practically exclude
competitors and monopolize the trade
itself.
Tho bill further alleges that 3" the
defendants fixed and maintained the
selling price of the Howard move
ment for both jobbers and retailers.
kept q blacklist of all dealers who sold
movements at less than the establish
ed price and refused to sell such
movements or any of their watch
cases to jobbers who continued TO sell
to retailers whose names appeared on
the blaxklF1."
| The. government also charges that
! the de ieutiant has also urged its com
petitors to 3I-yheir plants and bust
nesser'ip ,t4r Keystone Co.. threaten
ing MIRA With .destrYetion should they
refuse 20 do 50 Snd have declared their
intention ofsaexuirng the remainder
of the tradeEapd commerce in watch
cases, and have asserted that they
would spend 100000, if necessary
to drive some of the larger of its com.
petitors out of business. and that de
PENDANTS would hang crepe on tht
doors of such competitors factoriessa
The bill charges the company witt
deception in putting on the marke
certain inferior grade watch cases la
beled to suit the purchasers. will
long term guarantees to compel Other
! manufacturers to compete with falsely
! labelled cases.
The government declares that the
company has been enabled to realize
unreasonable profit" on its capita
stock.
/ The bill praYs that the acquisition o
various companies and contracts en-
tered into be adjudged unlawful; tina
the combination be disintegrated; tina
it be restrained from continuing it
monopolistic methods and that job
bers be left free to handle all kinds
of goods.