The Raymer enterprise., 1911-12-07

manufacture and sale OF chewing and
smoking tobacco and cigars. The
former one tin.foil company is d.
yided into two. one Of 3S25.000 cap
ital and the other Of 100000. The
one snuff company is divided into
three companies, one with capital
OF $l5,000,O00; another with cap.
ital Of 3s.000.O00: and a third with a
capital Of Ss.000.000 The licorice
companies are two. one with cap.
ital OF S5,75s.00 and another with a
capital of 100000. There is. also.
the British-American Tobacco com.
pany. British corporation. doing
business abroad with a capital OF
S26.O00.O00. the Porto Rican Tobac.
co company with capital OF
Sl,sOo.oo0, and the corporation OF
United Cigar Stores. with capital
OF $9.000.000. Under this arrange
ment each OF the different kinds OF
business will be distributed between
two or more companies. with a d.
vision OF the prominent brands in the
same tobacco products, SO as to make
competition not only possible but
necessary. Thus the smoking tobac-
co business Of the country Is divided
SO that the present independent com.
panies have 21.39 per cent. while the
American Tobacco company will have
33.os per cent. the Liggett and
Meyers zoos per cent. the Lorillard
company 22.S2 per cent. and the
Reynolds company 266 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
covenants restricting competition have
oeen declared null and further per.
lorfnance OF them has been enjoined.
The preferred stock Of the different
companies has now been given vot.
ing power which was denied It under
me old organization. The ratio OF
'ne preferred stock to the common
was as 7S TO 40. This constitutes a
very decided change In the character
OF the ownership and control oi
each company.
In the original suit .here were TWEEN.
ty.nine defendants who were charged
with being the conspirators through
whom the Illegal combination acquired
and exercised Its unlawful dominion.
Under the decree these defendants
will hold amounts OF stock In the va.
rious distributee companies ranging
from Al per cent as maximum to
2Sa per cent. as minimum, except
In the case OF one small company. the
Porto Rican Tobacco company. in
which they will hold IS per cent. The
twenty y.nine individual defendants are
enjoined for three years from buying
any stock except from each other
and the group is thus prevented from
extending its control during that pc.
riod. All parties to the suit and the
new companies who are made parties.
are enjoined perpetually from In any
way ef:ecting any combination be
tween any Of the companies In viola
tion OF the statute by way OF resump
'ion OF the old trust. Each OF the
fourteen companies is enjoined from
acquiring stock In any OF the others.
All these companies are enjoined from
having common directors 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 II 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 of
the capital and plant OF the trust into
small factions In amount more nearly
equal to that OF each Of the independ.
cnt companies. This contention re.
suits from n misunderstanding OF the
antitrust law and Its purpose. 1t is
not intended thereby to prevent the
accumulation Of large capital In busi.
ness enterprises In which such com.
bination can secure reduced cost OF
production. sale and distribution. II
Is directed against such an aggrega.
tion OF capital only when Its purpose
is that of sitting competition. enhanc'
ing or controlling prices and estab'
fishing n monopoly. II We shall have
by the decree defeated these purposes
and restored competition between the
large units into which the capital and
plan, have been divided. We shall have
accomplished the useful purpose ol
| the statute.
conHseatior Not the Purpose Of the
Statute.
I, is not the purpose OF the statute
to conflscate the property and capital
of the offending trusts. Methods oI
punishment by fine or Imprisonment
OF the individual offenders. by fine oi
THE corporation. or by forfeiture OF its
goods in transportation, are provided
bu, the proceeding in equity is a spe
cific remedy to stop the operation o.
| .hn trust by Injunction nnd nreYenl