Opinion ID: 1312425
Heading Depth: 5
Heading Rank: 3

Heading: Development of Antimerger Provisions

Text: In the meantime  and in the face of the various courts' narrow construction of the term combination  some states amended their earlier acts to adopt provisions that reached beyond the scope of all previous state acts and the Sherman Act. These newer acts, in addition to regulating trusts and combinations in restraint of trade, also regulated, inter alia, monopolies [12] and, significantly, corporate mergers. On the subject of mergers, the third of Texas's antitrust acts  the act of 1899  stated that monopoly was unlawful, and broadly defined monopoly as including all aggregations, amalgamations, affiliations, consolidations or incorporations of... assets [or] property, ... whether effected by the ordinary methods of partnership or by actual union ... or an incorporated body resulting from the union of one or more distinct firms or corporations, or by the purchase, acquisition or control of shares or certificates of stock[ [13] ] ... if ... created or entered into for any one ... of the purposes named in this act.... (1899 Tex. Gen. Laws, ch. 146, § 2.) Similarly, the second Mississippi act provided: No corporation shall directly or indirectly purchase or own the capital stock, or any part thereof, of any other corporation, nor directly or indirectly purchase, or in any manner acquire the franchise, plant or equipment of any other corporation, if such other corporation be engaged in the same kind of business and be a competitor therein. (1900 Miss. Laws, ch. 88, § 5.) The fourth (1903) Texas act made illegal any monopoly effected by either of the following methods: [¶] When the direction of the affairs of two or more corporations is in any manner brought under the same management or control for the purpose of producing, or where such common management or control tends to create a trust.... [¶] 2. Where any corporation acquires the shares or certificates of stock or bonds, franchise or other rights, or the physical properties, or any part thereof, of any other corporation or corporations, for the purpose of preventing or lessening, or where the effect of such acquisition tends to affect or lessen competition, whether such acquisition is accomplished directly or through the instrumentality of trustees or otherwise. (1903 Tex. Gen. Laws, ch. 94, § 2 (1), (2).) Finally, in 1905, Arkansas amended its earlier act and enacted an antimerger provision worded after the Texas version of 1899. (1905 Ark. Acts, No. 1, § 5.)