Evening star., 1925-10-06
BAKERY MERGER
FACES i. S. PROBE
Department of Justice Acts.
Federal Trade Commission
Charges Are Barred.


inst projected in New York to deter
I, mine whether there has heen any vio
lation of the Sherman antitrust law
il WAS revealed today.
The fact that the compa MES merged
would not necessarily mean that they
have violated the law. ii was pointe
ont. but should there he anything in
the articles of Incorporation involving
the Continental Baking Corporation
the Corby Baking CO.. the Ward
Brothers Baking Go. and the Ameri
can Baking Go. in contravention of
the Sherman act the Department of
Justice wants to know. So far as
known today at the department. the
compan nies had not complied with the
invitation OF Attorney General Sar-
gent to lay their plan on the table
voluntarily in order that informally
and in cooperation the prospective
associates and the Government might
go over the plan and see If the law
vas obeyed before further steps were
taken
Decision to call for the incorpora
tion papers and TO look into the mat
ter was made late yesterday.
Clayton Act Charge Filed.
Plans for the huge baking merger
which is to include the Continental
Baking Corpora ton have been brought
to com plerIon. As Just announced in
Nav York. In he face Of charges of
rr4Itioh of the Clayton act filed
aTs.nst that company by the Federal
Trade Commission nearly six months
ago.
Announcement of the merger plans
has brought to light that a complaint
charging violation Of the act was
served by the commission on the Con
tnental Corporation April l3 and has
emphasized anew the split in the com
mission over its new rule of secrecy
in issuing complaints. Acquisition of
control in number Of smaller con
Germs was cited a. the basis IF the
complaint.
a copy of the complaint has been
made public by two members of the
commission, Huston Thompson and
John +. Nugent, who opposed adop-
tion of the rule that complaints be
kept secret until the respondents have
fled answer and who once before have
deliberately disreearded its provisions.
Hope to Block Merger.
The two commissioners said they
considered their action advisable, in
view of the announcement of com
pleted plans for the S4o0 .00U,o
merger of the Continental Corpora
ton with the Ward and General Eak-
ing Corporations.
They maintained that the commits
sion had disregarded the spirit of the
Clayton act, under which authority its
complaints are issued by not making
the complaint public when it was
served. and had directly disreEarded
its requirements in not calling for
reply within 80 days.
Had such A course been followed
they said, the resulting publicity
would in all proba ahility have had the
effect of halting the combination of
the respondent with other great bak
ing corporations" until the legality of
such a merger could have been de-
tern,ined by proper testimony.
AS il is, they said. the Continental
Corporation has not yet filed formal
answer to the complaint. which
charges that the result of its acauisi-
lion Of the United Bakeries Corpora
lion. the Ward Bros. Baking Co.
he American Bakery Co. and others
has been Ito substantially lessen com
petition" between them and to tend
to create" A MONOPOLY
designations Demanded.
Announcement of the new merger
plans has brought a demand upon
President Coolidge by the Peoples
Legislative Service for the resignation
of members of the Federal Trade Com
mission. who, 1t was charged, had
by neglect of duty" permitted them
to go forward.
Basil NJ. Manly. director of the leg
islative service which was organized
by the La Toilette group in Con-
gress. declared in a letter to the
President that the merger. tby en-
hracing 157 huge bakeries. would en-
bile them to control bread prices in
every large city in the country. The
letter recalled a previous protest to
tbe commission for its failure to act
m the Senate resolution for an in
vestigation of bread prices.
In the copy of the complaint fur
nished by Commissioners Nugent
and Thompson. the record Of the
Continental Co. in purcha sing among
others the United Bakeries Corpora
tion. the Corhy Baking Co. the Ward
Rros. Baking Co. and the American
Raking Co, was recited. The result
IT. alleged. had been ito substantially
lessen competition between such
corporations: 10 restrain competi-
tion in bread. biscuit. crackers. cakes
and other food products and to
tend to create in the Continental
RakinE Co. a monopoly in COM
merce. This was all described as
constituting violation of the Clayton
antitrust law. and the company was
summoned 10 make answer.
Under the new rules instituted
by the majority of the commission
Commissioners Van Fleet Hunt and
Humphrey. no publicity is given to
a complaint until the answer of the
respondent is filed" the minority
statement said
Failed to File Answer.
The Clayton act. which gives the
commission jurisdiction in cases of
this kind. requires the answer of the
respondent to he filed within 80 days
after the service of the complaint
The records show that the respondent
was served with the complaint on
April 13. 1925. and under the statute
II should have filed an answer not
later than May l3.
Instead of nswerine. the re
spondent asked for an informal hear
Ing before Il subordinate body of
the commission known as the Board
of Review and for a delay in filing
their answer. Their request was
granted over the dissent of Commits
eioners Nusent and Thompson. Ap-
rroximately six months has passed
and no answer has vet been filed.
In the meantime the respondent
has been going ahead with it's plans
as set forth in the complaint. and
Il has been reported since the is-
auance of the complaint that more
companies and plants have been
taken over by the respondent. The
minority members point out that this
case shows the utter futility and
nenger of the new rule requiring
secrecy until an answer has been
filed. =
SeAs puhlic Neuared