The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1911-12-21
De clares It Unlawful
Combination in Viola
ton of ShermanLaw
BILL PRAYS FOR
ITS DISSOLUTION
Keystone Company Is Alleged to
Control 30 Per Cent. of Trade,
and Is Charged With Pur-
pose of Monopolizing 1t All.
Unreasonable Profits
Realized.

Philadelphia. Pa, December 20
me Federal government late this
afternoon filed in the United States
Circuit Court suit against tho Key
stone Watch Case Company. declaring
1t an unlawful combination in viola
ton of the Sherman antitrust act, ana
asking that 1t be restrained from
carrying on an alleged monopoly in
the manufacture and sale of watch
cases. The government declares that
the company now manufactures and
sells 80 per cent. of all watch cases
manufactured and sold In the United
States" and that 1t is the intent and
purpose of the defendant that tho
company shall monopolize the re-
mainder Of the trade and commerce"
The Keystone Watch Case Company
is Pennsylvania corporation. The
individual defendants named In the
bill are: Theophllus Zurhrugg. OF
Riverside, y. J.. until recently presi-
dent of the company; Caleb +. Fox.
Philadelphia. acting president: Edward
T. Stotesbury, Philadelphia. vice prcsi-
dent; John J. Mueller. Philadelphia,
secretary: Charles NJ. Fogg. Philadel-
phia, assistant treasurer. and Irving
Smith, New York, a director.
The watch industry movement In the
United States is divided into two parts.
watch case and watch movement or
oil the watch cases manufactured and
Sold moro than 90 per ccnt.-.are filled
cases.
Charges by Government.
After reciting the history Of the
~ ,E.rog H.. III
! tion whereby various watch concerns
were acquired. tho government charges
that in 1904 the Keystone Company
entered into a contract with the Elgin
| National Watch Company whereby tho
| Keystone Company was put In eX-
elusive charge of the entire export
trade OF the Elgin Company except the
trade with Cnnada; and in 1909 the
Keystone Company made a contract
with the Waltham Watch Company
whereby the former was made sales
agent of the latter In all the princi-
pal foreign countries where trade in
watch cases Is carried on except Great
Britain, France and Spain.
The Waltham and Elgin Com
pauies," the bill says, ARE two OF the
principal manufacturers of watch
movements in the United States. and
their sales to foreign countries con-
port trade In watch movements. Said
contracts are especially valuable to the
defendant company because they en-
ablcd II to enclose these movements
in its own case and thus promote Its
foreign watch case trade"
BY virtue OF these consultations and
contracts. the government in It's bill
asserts that the Keystone Company
directly and indirectly. engaged in the
manufacture and sale throughout the
United States and in foreign countries
of practically every grade of watch
cases and watch movements, and that 1t
so controlled the trade and commerce
In watch cases as to enable II to prac-
tically exclude all competition and
monopolize the trade Itself. The bill
further says:
The defendants endeavored to and
did induce jobbers to cease handling
any other lines OF goods than those
made by the keystone Company. and
it's subsidiaries: refused to sell jobbers
watch movements: and as to the How
ard movement they liked and main
tained selling prices for both jobbe-s
and retailers and kept a black list OF
all dealers who sold said movement
at less than the established price. and
refused to sell movements. as we'll as
any OF their watch cases. to jobbers
who continued to sell to retailers
whose names appeared on said list"
HFfght on Competitors.
The Esovernment also charged that
defendants have also urged its com
petitors to sell their plants and bust
nesses to the keystone Company.
threatening them with destruction
should they refuse to do so. and have
declared their intention OF acquiring
tho remainder of the trade and COM
merce in watch cases. and have assert
ed that they would spend n million
dollars IL necessary to drive some Of
the larger OF It's competitors out Of
business and that defendants would
hang crepe upon the doors of such
competitors factories"
The bill charges the company with
deception in putting on the market
certain inferior grade watch cases,
labeled to suit the purchasers, with
long-term guarantees In order to com
pei other manufacturers to compete
with falsely labeled cases
The government declares that tho
company has been enabled to realize
"unrea sonablo profit" on It's capital
stock.
The bill prays that the acquisition
OF various competitors and contracts
entered into be adjudged unlawful;
that the combination be disintegrated:
that 1t BIO restrained from continuing
It's monopolistic methods, and that
jobbers be unrestrained In their desire
to handle all kinds OF goods
fEs