The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1911-05-30

of five large and successful plug man
ufacturers. The American Tobacco
company transferred to it its plug
business and "Mr. Duke, the president
became president of the Continental
company"
The second period, or that following
the organization of the Continental To-
bacco company, was described next: Of
these years, Chief Justice White said:
I'm 1899 and thereafter, either Amer
lean or Continental companies. for cash
or stock, at an aggregate cost of fifty
millions of dollars, ($50, 000,0 0O, bought
and closed up some 30 competing cor
porations and partnerships therefore
engaged in interstate and foreign com
merce as manufacturers, sellers and
distributors of tobacco and related
commodities, the interested parties
covenanting not to engaged in the bust
ness"
Plants Were Closed.
Not only did the American and Con-
tinental companies continue to acquire
other companies, but the chief justice
quiring still more companies.
at is of the utmost Importance" said
the chief Justice "to observe that the
acquisition made by the subsidiary
corporations in some cases likewise
show the remarkable fact stated above,
that is, the disbursement or enormous
amounts of money to acquire plants
which, on being purchased, were not
utilized, but were Immediately closed"
Finally the chief justice came down
to the merger of 1904 of the old Amer1-
can Tobacco company, the Continental
company and the Consolidated Tobacco
company into the new American To-
bacco company. Through the method
of distribution of the stock of the new
company, the chief justice said that J.
- mt IN
Whitney, Anthony N. Brady, Peter A.
B. Widenor and Oliver H. Payne were
able to continue the control in the new
company that they had exercised in the
old.
In taking up the construction and ap-
plication of the Sherman antitrust
law, Chief Justice White said that II
the law was applicable to the entire
situation presented in the tobacco case
and was adequate to afford relief, 1t
can only be because that law will be
given a more comprehensive application
than has been affixed to it in any pre-
vious decision, questions not hitherto
considered by the court were included
in the case at bar.
Justice White added that the OBJ
security and resulting uncertainty which
had enshrouded the Sherman antitrust
act had been removed by the considera-
ton the court had given the law in the
Standard Oil case recently decided. The
chief justice then launched forth into
defense of the rule of reason law as
laid down by the court in the Standard
Oil case. He said:
I'm that case it was held, without de-
parting from any previous decision of
the court, that as the statute had not
defined the words restraint of trade, it
became necessary to construe those
words, duty which could only be dis
charged by resort to reason. We say
the doctrine thus stated was in accord
with all the previous decisions of this
court, despite the fact that the con-
trary view was sometimes enormously
attributed to some Of the expressions
used in two prior decisions (the Trans
missouri Freight association and Joint
traffic cases) that such view was i
mistaken one was fully pointed out i'll
the Standard Oil case and is additional
ly shown by a passage in the opinion
In the joint traffic case as follows:
The act OF congress must have a rea-
sonable construction, or else there
would scarcely be an agreement of con-
tract among business men that could
not be said to have, indirectly or re-
motely, some bearing on interstate
commerce and possibly to restrain it."
Applies Standard Rule.
Applying the rule of reason to the
construction of the statute, it was held
in the Standard Oil case that as the
words restraint of trade at common
the time of the adoption of the anti
trust act only embraced acts or con-
tracts or agreements, or combination
which operated to the prejudice of tho
public interests by unduly restricting