The Julesburg grit-advocate., 1911-12-14

gett 4 Meyers COOS per cent. the I4oril-
lard company o::S2 Per cent and the
Reynolds company 2.G6 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
been declared null and further Per
formance OF them has been enjoined.
The preferred stock of the different
companies has now been given voting
power which was denied 1t under the
old organization. The ratio Of the pre-.
ferred stock TO the common was as IS
to 20. This constitutes a very decided
change in the character Of the owner
ship and control of each company,
In the original suit there were TWEEN.
ty-nine defendants. who were charged
with being the conspirators through
whom the illegal combination acquired
and exercised its unla wfui dominion.
Under the decree these defendants will
hold amounts Of stock in the various
sistributee companies ranging from Al
er cent rs maximum to 2Sl. pcr
.cnt as a minimum. except In the case
Of one small company. the Porto Rican
Tobacco company. in which they will
hold ~ per cent. The twcnty-ni in
dividual defendants nre enjoined for
three years from buying any stock ex-
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 perpet-
ually from in any way effectinG any
combination between any Of the com.
panies 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
snjoined from having common direc-
ors or ofiicers. 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 1t left
companies with very large capital in
active business and that the settle.
ment that would bc effective to put all
on an equality would be division OF
the capital and plant Of the trust into
small fractions in amount more near.
ly equal to that Of each Of the indie.
pendent companies. This contention
results from a misunderstanding Of
the antitrust law and its purpose. 1t
is not intended thereby to prevent the
accumulation Of large capital In bust
ness enterprises in which such n COM
bination cHn 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 establish
ing 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.
confiseation Not the Purpose OF the
| ot1tute.
1t Is not the purpose of the statute
to confiscate 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 its
goods in TRANSFORMATION are provided
but tie proceeding in equity is spc-
citic remedy I" 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 oeerse.
! venture to say that not in the his
tory OF American law has decree
more effective for such Il purpose been
entered by Il court than that against
the tobacco trust As Circuit Judge
NoyeS said In his judgmen, approving
the decree:
The extent to which it has been
necessary to tear apart this comhina-
ton and force it into new forms with
the attendant burdens ought to demon
Stra,c that the federal antitrust statute
is Il drastic statute which accomplisl,cs
effective results. which so long as i,
stands on the statute books must be
obeyed and which cannot. be d:sobey.
ed without incurring farreaclling pcn.
alticS. And. on the other hand. the
successful reconstruction OF this or
ganizatinn should teach that the effect
OF enforcing this statute is not to dc.
Stroy. but to reconstruct: not 10 de-
moli>h. but to rccreaic in accordance
with the conditions which the congress
has declared slnll exist among the
people of the United States
Common Stock Ownership.
1t has been assumed that the pres
ent pro rata and common ownership In
all these companies by former stock.
holders "f the ,'rIst would insure II
cc.,.nnance of the same old single cor.
troll nf all the companies into which
the trust has by decree been disinte-
grated This is erroneous and il hosc1