El Paso herald. (El Paso, Tex.) 1901-1931, 1911-01-06
FIGHT AGAINST
TOBACCO TRUST
Final Efforts of Government
to Dissolve Corpora
ton.

Washington, D. c., Jan. 6.-The fina!
contest over the dissolution of the
American Tobacco corporations began
today in the supreme court Of the
United States
History of Case.
The suit under the Sherman anti
trust law to dissolve the socalled TO
bacco trust was instituted in 1907 in
the circuit court OF the United States
for the southern district of New York.
The proceedings was brought by the
| department OF justice against more
than so corporations and a number OF
individual defendants headed by James
3. Duke.
The process of organization of the
combination alleged to be unlawful
spread over many years. 1t began in
January 1890. Then the first Amari-
can Tobacco company was incorpor-
ated for the purpose, it is alleged, OF
taking over the business of five in
dependent cigaret plants.
In 1888, the Continental Tobacco
company was Incorporated for the
alleged purpose of taking over the
plug-tobacco business of the American
Tobacco company. and the business Of
five other plug tobacco concerns.
In 1900 the American Snuff company
was incorporated for the alleged pur-
pose of taking over the snuff business
of the American Tobacco company and
of two or three independent snuff
manufactured.
In 1901. the American Cigar company
was Incorporated for the alleged pur
pose of taking over the cigar business
of the American Tobacco company and
an Independent manufacturer Of cigars.
The Consolidated Company.
In the same year, the Consolidated
Tobacco company was Incorporated for
the alleged purpose of taking over as a
holding company in exchange for its
bonds substantially all of the stock Of
the American Tobacco company and
the Continental Tobacco company.
In 1903, the American Stogie COM
pany was incorporated for the alleged
purpose of taking over the stogie bust
ness of the American Cigar company,
the American Tobacco company and
the Continental Tobacco company.
1904 the American Tobacco company
the Continental Tobacco company and
the Consolidated Tobacco company
were merged into the present American
Tobacco company.
It is alleged that in addition to this
Organization, the American companies
in 1902 entered into a contract with a
British company, the Imperial Tobacco
company, whereby the American COM
panies were limited in their business to
America and the British to Great
Britain, except that the latter could
buy leaf tobacco in the United States.
1t was alleged that the British-Ameri-
can Tobacco company was organized
to take over the export business of
both the British and the American
companies.
Proof of a Trust.
Testimony was presented to prove
that the defendants produced 20 per-
cent of the smoking tobacco made in
this country; IS percent OF the
cigarets; 81 percent Of the plug and
twist tobacco; 81 percent of the fine
cigars: 96 percent of the snuff; 95 per-
cent OF the Iicorice paste; 70 percent
of the tin foil and most of the tobacco
extracts, boxes and containers.
Three of the four judges on the
circuit bench united in a decree This
decree dismissed the petition as to the |
Imperial company and the British
American company. and the United I
Cigar Stores company, which was
organization. This action formed one /
of the grounds for appeal by the /
government to the supreme court
The decree adjudged the other de-
PENDANTS to be parties to an unlawful /
combination. but said nothing about
the monopolizing charges. This failure +
furnished another ground for appeal 1
by the government. The American To- ,
hacco company. the American Snuff i
the American Cigar company. /
T. Lorillard company, r. J. Reynolds
Tobacco company. Blackwelfs Durham
Tobacco company and the Con1ey Foil
company were adjudged to hold shares
in number of specified tobacco cor
porations and enjoined them from ac-
curing the plants or business or vot-
ing the shares of and from exercising
control over these subsidiary com
panies. The government was dissatis-
fled because the holding companies
we're not enjoined from collecting divi-
bends from the subsidiary companies.
The defendants appealed to the SUI
preme court because the petition of the
government was not dismissed in toto