The Barre daily times. (Barre, Vt.) 1897-1959, 1920-12-06
RESTRAINT
OF TRADE
WAS SHOWN
The Redistribution of
Stock in Lehigh Valley
Railroad Was Ordered
By the Court-The Case
Is One of the Most I'm
portant i'm Recent Years.


ernment to-day won its antitrust suit
against the Lehigh Valley Railroad Co.
and affiliated corporations.
The supreme court, in a decision
read by Associate Justice Clarke, sus-
tanned charges of monopoly and viola
tion of the Sherman antitrust law
The court held that charges of vio-
lstion of the commodities clause in
the formation of the Lehigh Valley
Coal Sales company had been proven.
Redistribution of stock of the Le-
high Valley company, asked by the
government, was ordered by the court
upon the governments contention that
common stock ownership, officers and
directors constituted restraint of trade
prohibited by the Sherman act
Justices McReynolds and Brandeis
took no part in the consideration of
the case. Justice McReynolds was at
torney general while the case was
pending
History of the Case.
The Lehigh Valley Railroad COM
pany and affiliated rail, coal produc-
tion and sales companies were charged
with a separate monopoly in anthra-
cite coal along the Lehigh Valley roads
lines in Pennsylvania in a suit begun
by the government March IA, 1914
Two principal charges were made
restraint of trade in violation of the
antitrust law and violation of the
commodities clause by the transpor-
tation of coal in which the railroad had
an interest.
Neither charge was sustained in the
lower court and the governments suit
was dismissed by Federal Judge Hough
at New Fork Dec. u, 1914. He based
his decision, however, upon a circuit |
court decree finding the Delaware, !
Lackawsps & Western reilroda not
guilty of violating the commodities
clause. which the supreme court later |
revised. Thereupon the government
appealed the present case against the
Lehieh Valley
The supreme court was asked by the 4
government to give a general decree !
10 break up. principally by means of |
redistribution of ownership of stock,
the alleged anthracite combination of /
the Lehigh Valley railroad interests.
For alleged violation of the eommodi-
ties clause cancellation was asked of 1
a contract of the Lehigh Valley Coal
Sales company giving it the right to
hilv and sell all coal produced by the
Lehigh Valley Coal company and sub
salaries.
Alleged common ownership of stock
OF the railroad. coal and sales com
panies was especially attacked. and the
government sought to compel the rail
road company TO dispose of the stocks
Of its subsidiary coal companies to
persons who are neither its stockhold
ers nor its agents nor in any way un
der its control and influence
Ownership Of 10000 acres Of coal
land mostly in the Wyoming fields of
Pennsylvania. by the Lehigh Valley
interests and control Of so per cent II
anthracite tonnage on its liens were
alleged by the government.
Excessive freight charges 10 eompet-
itors. rebates and preferences TO Ise-
high Valley subsidiaries also were al
legged Organization Of the Eehigh Val
lev Coal Sales Co. in 1912 with its con
tract 20 buy, at the mines, all coal pro-
duced bv the railroads coal companies.
whose entire stock the railroad owns.
was declared to be an attempt 10
evade the commodities clause. The
sales company, IL was ALLEGED was
mere artifoe Of the railroad company
70 that end and not actually independ
emily controlled
In defense. the Lehigh Valley inter
rsts contended that more than 2s per
cent OF the coal acreage tributary 10 .
the railroad lines WAS controlled. They
denied charging excessive rates to com
petitors. or granting unlawful prefer l
cnccs or financial aid to the coal com
panics.
Mere common ownership of much of
tic railroad. coal aud sales compa ,
mics stock. the I.ehigh Valley inter :
est- contended. did not constitute Hio- ,
laiion al the sherman Law Common
stock hclders. directors and. in q few Z
rsscs. oficers. of the various corpora \
tious. i Wa conteuded. were not in :
frar:ions of tie antitrust act
Organization of the coal sales com /,
ranv was ssd to have been effected
eEsllv 10 meet and not defeat the
elsuse. The sales com
,snre contract ess declared entirely
isaersnf and free from the objections
n the I.aeka e-auna arrangement. pro
Illegal by the court By bay v
~ ncsi AZ the nsfme mouth. wit houf "
iurnfna fsu ar esnsr8I ~ ihe railroad Il