The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-12-07
LEHIGH COMBINE
IS ILLEGAL SAYS
SUPREME COURT
Orders Divorcing of Rail
and Principal Subsid-
iary Companies.
POINTS BY u. s. UPHELD
Production, Shipping and
Sale Of Anthracite Coal
Monopolized.
TRICK IN SALES BRANCH
Justice Clarke Says Concern
Deliberately Planned to
Suppress Competition.
POINTS BY U. S. UPHELD
TRICK IN SALES BRANCH

WASHINGTON. Dec. 6.--The Lehigh
Valley Railroad case. the second and
last of the great anthracite ANTITRUST
cases, was won to-day by the Govern
ment.
The Supreme Court. in the unani-
nous opinion of the seven members
participating, held that the. existing
combination of the railroad and it's
principal subsidiary companies was in
violation Of the Sherman antitrust
act, and. reversing the lower court. Or
dered entering of a. decree dissolvins
the combination and red1stributing it's
stocks. bonds and properties SO as to
make each component part in fact in
dependent and competitive.
Specifically named In the order OF dis
solution were the Lehigh Valley Rail-
road Company. Lehigh Valley Coal Com
pany. Lehigh Valley Coal Sales Com
pany. Coke Brothers & Co.. and Della
ware Susquehanna and Schuylkill Rail-
road Company, The court dismissed the
bill so far as it named the New York.
and Middlefield Railroad and Coal Cont
pany, the G. b. Markle Company. the
G;irard Trust Company and individual
defendants, including the late George b.
Baer, Daniel Reed, Eden Il. Thomas,
Lyman d. Smith. ID. +. Stotesbury.
George +. Baker and other officers and
directors of the defendant companies
prominent In the financial and railroad
world.
Justices McReynolds and BrandeAs
took no part in the consideration of the
case, it was announced,
Government Contention Upheld.
The opinion of the Court, as read by
Justice Clarke. sustained in unequivocal
language virtually every contention
raised by the Government In it's brief.
1t was held that the Lehigh Valley
Railroad. through the coal company of
tho same name and other subsidiaries.
monopolized the production, uansporta-
ton and sale of anthracite coal from
mines along it's lines; that this monopoly
was sustained through Illegal preference
to the subsidiaries, and that the organi-
zation OF the Coal Sales company was In
fact mere device to circumvent the So
called commodity clause of the Inter-
state Commerce act. which forbids a
common carrier 10 tfaubpOTl COAL III
which 1t has any interest.
This history of almost twenty-five
years." the opinion said. AFTER reviewing
the life of the railroad from It's incep-
ton, casts an illuminating light upon the
intent and purpose with which the COM
bination here assailed was formed and
continued"
Evidence submitted by the Govern
ment was accepted as proof that the
80
thracite lands along its lines in the
limited area Of anthracite producing ter
ritory," and that 95 per cent. of the coal
tonnage moved by the railroad in 1908
was controlled by 1t through its complete
dominance Of the parent coal company
which produced the tonnage.
Bought Coal hands, Esriy.
Justice Clarke said the court concluded
that 1t was CLEARLY established that
prior to the enactment Of the ANTITRUST
act the railroad company. In combina-
lion with its coal company Subsidiary,
deliberately entered upon q policy of
making extensive purchases of anthra-
cite land tributary to tho railroad oom-
pany's line for the purpose Of controlling
the mining. transportation and sale of
coal to be obtained therefron and Of
preventing and suppressing' competition.
especially In the transportation and sale,
OF such coal In Interstate commerce. and
that this policy was continued after the
passage of tho antitrust act with In
oreasng energy and tenacity of purpose.
with the result that practical monopoly
was attained OF the transportation and
sale of anthracite coal derived from such
lands"
The area of the anthracite territory
is SO restricted" said the court. that
thus to obtain control Of the supply of
such coal on a great system Of railway
by combination of corporations such
az we have here. effected restraint of
trade among the several States and con-
stituted an attempt to monopolize and
an actual monopolization Of a part of
such trade clearly within the meaning Of
tho first and second sections of the anti
trust act as they have been frequently
interpreted by this court
H. r. Loomis, president OF tho Lehigl
Valley Railroad. ana Il. H. Boles, gen.
eral counsel. declined yesterday to make
any comment on the decision OF tho SUI
preme Court. "We have not seen a COPY
of tho decision" they said have moth
ing but sketchy reports TO go on and of
course, cannot comment on them"
In Wall Street the report was accom-
panied by a sharp advance Of three
points I'm Lehigh stock. which advance
was not maintained. The property In
volved according 10 railroad and coal
men familiar with 10. liz In the rich
wyoming county region of northern
Pennsylvania. The coal subsidiary has
an annual production OF approximately
100000 tons. with a gross income of
about $4,000, 600. The coal properties
are said to have q book value OF $780,
a -. - ..~frf