The Chanute times., 1911-12-08
Only Matter Touched On In Presidents S
Message to Congress
Additional Legislation to Strengthen Present
Statutes Is Recommended ---Defends Stand
ard Oil and Tobacco Decisions


with the antitrust statute. The message
In part Is as follows:
| To the Senate and House of Represent
atives: This message Is the first OF sew
eral which shall send to congress during
the interval between the opening OF Its
regular session and its adjournment Tor
the Christmas holidays. The amount OF
information to be communicated as TO
the operations of the government, the
number Of important subjects calling for
comment by the executive. and the trans
mission to congress of exhaustive re-
ports by special commissions, make II I'M
possible to include in one message OF
reasonable length discussion OF the top
ics that ought to be brought to the at
tention OF the national legislature at Its
first regular session.
The Antitrust Law-The Supreme
Court Decisions.
In May last the Supreme court handed
down decisions in the suits In equity
brought by the United States to enJoin
| the further maintenance of the STANDARD
OIL trust and of the American Tobacco
trust, and to secure their dissolution. The
decisions are epoch making and serve TO
advise the business world authortatively
Of the scope and operation of the anti
trust law Of 1890 The decisions do not
! depart in any substantial way from the
| previous decisions of the court In constru-
ing and applying this important statute,
but they clarity those important decisions
| by further defining the already admitted
exceptions to the literal construction OF
the act BY the DEGREES. they furnish a
useful precedent as to the proper method
OF dealing with the capital and property
of illegal trusts These decisions sug-
gest the need and wisdom of additional
or supplemental legislation to make II
easier for the entire business community
to square with the rule of action ana
legality thus finally established and to
preserve the benefit, freedom and spur
OF reasonable competition without loss OF
real efficiency or progress
No Change In the Rule of Decision
Merely In Form of Expression.
The statute in its first section declares
to be illegal "every contract, combination
in the form of trust or otherwise or con-
spracy, in restraint of trade or COM
merce among the several states or with
foreign nations" and in the second, de-
clares guilty of misdemeanor every per-
son who shall monopolize or attempt to
monopolize or combine or conspire with
any other person to monopolze any part
of the trade or commerce Of the several
states or with foreign nations"
| In two early cases, where the statute
was invoked to enjoin a transportation
agreement between interstate railroad
companies, II was held that 1t was no de-
fense to show that the agreement as TO
rates complained Of was reasonal at COM
mon law, because 1t was said that the
statute was directed against all con-
tracts and combinations In restraint OF
trade whether reasonal at common law
or not 1t was plain from the record.
however, that the contracts complained
of in those cases would not have been
deemed reasonable at common law.
1t has been said that the court, by in
| Producing into the construction OF the
statute common law distinctions, has
emasculated it. This is obviously untrue.
| By its Judgment every contract and COM
bination in restraint OF interstate trade
made with the purpose, or necessary ef-
feet of controlling prices by sitting com
petition. or of establishing in whole or In
part a monopoly OF such trade, Is con-
demned by the statute. The most ex-
treme critics cannot instance case that
ought to be condemned under the statute
which is not brought within Its terms as
| thus construed.
The suggestion is also made that the Su-
preme court by its decisions in the last
two cases has committed to the court the
underlined and unlimited discretion to de-
! termine whether a case or restraint OF
| trade is within the terms OF the statute.
| This is wholly untrue. reasonable re-
straint Of trade at common law Is well
understood and is clearly defined. 1t does
| not rest in the discretion of the court 1t
must be limited to accomplish the purpose
OF a lawful main contract to which, In
| order that 1t shall be enforceable at all,
! II must be incidental. II 1t exceeds the
| needs of that contract 1t is void.
The Remedy In Equity by Dissolution.
In the Standard Oil case the Supreme
and circuit courts found the combination
to be a monopoly of the interstate busi-
ness of refining, transporting, and mar
keting petroleum and its products, effect
ed and maintained through thirty-seven
| different corporations, the stock OF which
was held by a New Jersey company. 1t
in effect commanded the dissolution of
this combination. directed the transfer
| and pro-rata distribution by the New Jer-
sey company OF the stock held by 1t In
the thirty-seven corporations to and
among its stockholders, and the corpora
tons and individual defendants were en-
ioined from conspring or combining to
| restore such monopoly: and all agree
ments between the subsidiary corporations
| tending to produce or bring about further
violations of the act were enjoined.
In the Tobacco case. the court found
| that the individual defendants, twenty
nine in number, had been engaged in
successful effort to acquire complete do
| n,nion over the manufacture. sale. and
distribution of tobacco in this country
and abroad, and that this had been done
bv combinations made with purpose
and effect to stifie competition. control
prices. and establish a monopoly. not
only in the manufacture of tobacco. but
also of tin-foil and ncorice. used In Its
manufacture and of its products Of ci-
rars. cigarettes and snuffs. The tobacco
1Iit presentend a far more complicated
| and difficult case than the Standard OIL
| Euit for a decree which would effectuate
the win Of the court and end the viola
/ tIon of the statute. There was here no
Eingle holding company as In the case
| Of the Standard OIL trust. The main COM
many was the American Tobacco COM
many. a manufacturing. selling and hold
| ing company The plan adopted to de-
stroy the combination and restore compe-
tition involved the redivision of the capi-
tai and plants of the whole trust between
some of the companies constituting the
trust and new companies organized for
the purposes of the decree and made par
| ties to II, and numbering. new and old.
| fourteen.
In the original suit there were twenty
rtne defendants who were charged with
L An - kMnW . h.