Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1914-08-12

Harvester Company was declared TO be
a monopoly in restraint of interstate
and foreign trade, and was ordered dis
solved by majority decision in the
United States district court.
Unless the S140, 100000 corporation
submit plan for the dissolution of the
combination into at least three inde-
pendent concerns within ninety days
or in case OF appeal within ninety days
of the issuance OF an appeal mandate
from the United States supreme court.
the decision announces that the court
will entertain an application for the
appointment of a receiver for all the
properties of the corporation.
The decision of the court was given
by Circuit Judge Walter l. Smith, OF
Iowa. with which Judge William C..
Hook, OF Kansas. agreed, and from
which Judge Walter A Sanborn OF
Minnesota. dissented.
Always In Violation Of Law.
The majority opinion held that the
International Harvester Company was
from its organization in 1902 in viola
ton of the Sherman law. The original
corporation. formed OF five concerns,
violated the first section Of the Sher-
man act by restraining competition
among themselves. The com bined or
ganization also tended to raonopolize
trade in contravention Of the second
section OF this law.
Tie decision declares that while the
International Harvester Company and
its selling organization, the Interna-
tional Harvester Company Of America,
control from 50 TO So per cent OF the
trade in agricultural implements manu-
featured by them, their treatment or
smaller competitors in general has been
fair and just.
Acts Are censured.
The court finds fault with the actions
Of the corporation. aside from the teen
meal violation OF the Sherman law. for
only two actions. The opinion declares
tina. there was no excuse for the adyer-
Using Of the products OF D. NJ. Osborne
& Co. as independent for two years
after il had virtually entered the Inter
national Harvester Company. This ad-
vertising was 10 induce purchasers. the
court finds, from those who were OPP
posed to buying from the combination.
The other act censured BY the decl-
sion was the manner in which the hve
original concerns We're turned over to
the International company by William
c. Lane, a New York banker, who con-
tended that he had purchased the
properties. :.
The court is clearly Of the opinion,
the decision reads, that the process by
which il was made to appear that the
properties We're sold to Lane was mere
ly colorado.
Not overcapitalized.
The court holds however. that the
property turned in to the International
company was greater than the stock
issued for it, and that the case in
wolves no question of oyercapitaliza-
ton.
The court cites portions Of the de-
cision in the cases of the Standard Oil
Company the American Tobacco Com
pany, the DUPONT De Ne,nours Com
pany. and other cases as to what con-
tstitutes the restraint of trade, rea-
sonable and unreasonable, and con-
cludes:
we think it may be laid down as a
general rule that If companies could
not make a legal contract as to prices
or as to collateral services, they could
not legally unite, and as the companies
named did in effect unite, the sole
question is as to whether they could
have agreed on prices, and what col
lateral services they would render
when their companies were all pros
! porous, and they jointly controlled so
/ to So per cent of the business in that
line in the United States. We think
! they could not have made such an
agreement.
Supreme as Monopoly.
| '1f the five companies which formed
the international had been small and
their combination had been essential
to enable them to compete with large
corporations in the same line, then
their uniting would, in the light Of
reason, not have been in restraint Of
trade, but in the furtherance Of it: but
when they constituted the largest
manufa cturers of their articles in
America, if not in the world, and held
jointly about so to So per cent of the
trade, and two at least of the COM
panies forming the combination were
prosperous, their combining was, when
similarly viewed, an unreasonable re-
straint of trade. If the business of the
separate companies combining was un-
successful it could be plain that their
combination was reasonable in view OF
the rule of reason as proclaimed by
the supreme court, but it is conceded
that the Mccormick and the Deering
companies had established reasonably
successful and prosperous businesses,
so that question is eliminated.
There is no limit under the Amer
lean law to which a business may not
Independently grow, and even a COM
bination Of two or more businesses IL
trade Is not illegal; but it is the COM
bination which unreasonably Restraints
trade that is Illegal and II the parties
in controversy have so or 80 per cent OF
the American business, and by the
combination of the companies all COM
petition is eliminated between the con.
stituent parts of the combination Their
it is in restraint Of trade within the
meaning of the statutes under all O
the decisions"
Combined Concerns.
The decision reviews the history o
the manufacture of harvesting nipple.
ments in the United States, asserting
that prior to the organization of tn,
International Harvester Company tn,
principal manufacturers Of harvesting
implements in the United States were
The Mccormick Harvesting Machin,
Company. Of Chicago. founded in abou
1s4s.
!, D. NJ. Osborne & Co., Of Auburn, N
. T. founded about 1859.
y The Warder. Bushnell & Glessne