The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1911-01-07
Compel ition Utterly
Crushed by So-Called
Tobacco Trust.
CHARGE is MADE
BY GOVERNMENT
In Opening Arguments Before
Supreme Court McReynolds
Springs Surprise by Asking
tor Dissolution Under Will
son Act as Well as Sher-
man Antitrust Law.

arguments directed at the prouosed ais
solution OF the so-callcd Tobacco
trust were begun late to-day in the
Supreme Cont or the United states.
AS year ago. when the dissolution
Suit was argued for the first time be-
loIc the court so to-day j. C. Mickey
Mods special assistant 10 the Attor-
General. ;n charge OF the tobacco
hsht Tor the government. made the
opening address To the court. lie had
nor concluded his remarks when court
adjourned until Monday
Mf McReynolds surprised some mem
pcfs OF the court by stating that the
dissolution was asked. not only under
me sherman antitrust law. but under
? Inc WILSON tarin act Of 1894
Mr.. McReynolds told the court ;hat
ms was tie first case that ever had
heeh brought under the Wilson tariff
act. The act. he explained applied
70 Instances II restraint Of trade
whcr. an importer was party
Much discussion had taken place in
.hc trust eases as TO whether or not
inc phrase restraint OF trade" as
used in the sherman antitrust law,
was equivalent 10 restraint of free
competition" Mr. McRcynolds pointed
10 me wilson act as the congres sional
Interpretation OF the sherman act,
passed four years previous, In which
an doubt az 10 the meaning had been
removed By using the phrase, restraint
OF free composition"
Gives Hfstor, nr Trust"
Nearly the entire time that Mr. Nc
Keynp!ds spoke was devoted 10 his.
tory of the so-called tobacco trust.
from the time the first American To-
nacno company was organized in 1890.
Tor the alleged purpose OF cnectiny I.
monopoly in the cigarette trade, and
mus avoiding competition, OF impor-
tant corporations, down to the incor-
poration in 1904 of the new American
tobacco Company as a holding com
nany. controlling siXty-nye companies
interested In various branches of the
tobacco business.
lie described the plug war about
lae2. resulting in the organization OF
the Continental Tobacco Company, by
whi2h. he alleged. peace was restored
ana competition OF independents was
eliminated. lie told OF similar combi-
nations IN the snuff. cigar and stogic
trade. These combination. he described
as designed to remove competition.
once organized, he told how competing
plants were purcha sed each purchase
being accomplished BIS covenants on
the part of those who were selling ont
not 10 engage ia the business OF man
ufacturing or selling tobacco within
from ten TO twenty years in the United
states, except Nevada and q Territory
or two. Finally he turned to the con
tracts OF the American Tobacco Com
pany with the so-callcd British To
bacco Trust" the Imperial Tobacco
Company. BY these contracts. lie said
tho trade OF the world In tobacco had
Dene parceled ont between them, the
American trust" taking the United
states and Cuba for its own, the Brit-
ish trust" Great Britain, Ireland and
the Isle of Man, and the British Amer
lean Tobacco Company, organized by
the two trusts carrying on the to-
bacco business I'm the rest OF the world
AS n result OF these combinations he
alleges that competition Tor the pur-
chase of leaf tobacco had been clint
mated i'll the United States
Instituted In 1907.
The suit under the Sherman anti
trust law TO dissolve the so called TO
bacco trust" was instituted in 1907 in
tho Circuit Court of the United States
Tor the Southern District Of New York
The proceedings were brought by the
Department OF Justice against more
than sixty corporations ana number
of individual defendants. headed 10y
James &. Duke.
The process of Organization of the
combination alleged to be unlawful
spread over many years. 1t began in
January. 1890. Then the first Ameri-
can obacco Company was Incorporated
for the purpose, Ii is alleged, of taking
cigarette plants.
In 1898 the Continental Tobacco Com
pany was incorporated for the alleged
purpose of taking over the plug to-
bacco business of the American To-
bacco Company and the business of
five other plug tobacco concerns
In 1000 the American Snum 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
manufacturers.
Cigar Company Incorporated
In 1901 the American Cigar Com
pany was incorporated for the aIlegei
purpose of taking over the cigar bust
ness Of the American Tobacco Company
and an independent manufacturer or
cigars.
In the same year, the Consolidated
TOBACCO Company was Incorporated for
the alleged purpose of taking over as
holding company in exchange for IT'S
bonds substantially all of the stock OF
tho american Tobacco Company and
the Continental Tobacco Company.
In 1908, the American Stogic Com
pany was incorporated for the alleged
purpose OF taking over the stosie bust
ness OF the American Cigar Company.
the American Tobacco Company and
the Continental Tobacco Company
In 1901 the American Tobacco Com
pany, the Continental Tobacco Com
pany and the Consolidated Tobacco
Company were merged into tic present
American Tobacco Company.
1t is alleged that in addition 10 this
organization. the American companies
In 1902 entered into n contract with a
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