Court Opinion

ID: 5204044
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:58:02.033291+00
Date Added: 2024-06-11T08:27:15.238861
License: Public Domain

Gaynor, J.
(concurring):
While there are allegations in the complaint of many corporations, the only defendants are the. corporations The American Tobacco Company and The Metropolitan Tobacco Company, and three officers thereof. Out of the masses of confused and useless verbiage of the complaint, it is possible with painful diligence to pick out allegations' that the defendant The American Tobacco Company is associated with and controls •. a large number of corporations which, like it, are engaged in the manufacture and sale of the products of leaf tobacco; that these associated corporations control and market more than 90 per cent, of such products in this country and in the City of Hew York; that no dealer or jobber in the tobacco business can successfully do business without obtaining and handling the products of .the said associated corporations; that the defendant The Metropolitan Tobacco Company is not a manufacturer of tobacco, but is appointed by the said associated corporations their sole agent, to sell their products in the City of Hew York, arid is acting as such, and that such products, can be purchased of it alone by dealers in tobacco products in the said city, the said corporations refusing to. sell to them except through their said agent; and that the said agent, “with the'knowledge and consent of the other defendants ”, refuses to sell any of the said products to the plaintiffs,- who are jobbers and dealers in tobacco products in the said city. • There is no allegation that any of the associated corporations is a party to such refusal, except the defendant(The ‘American Tobacco Company. How, The American Tobacco Company, like any corporation or person, may lawfully refuse to sell its goods to the plaintiffs or to any one, for any reason or no reason —' at all events unless it has such a monopoly that sufficient tobacco goods can be got of no one else, which is not alleged. If, however, it should combine with other corporations or persons to do so, that would be a combination in restraint of trade and unlawful (Straus *456v. American Pub. Assn., 177 N. Y. 473). The trouble with this complaint is that there is no allegation of such a combination. There is a mass of allegations of evidence (which a pleading should never contain) and other matter, which .the diligent pleader may, have meant in their sum total or.effect for such an allegation, but they do not eke it out, try how you will. The allegation that The Americán Tobacco Company controls all of. the other associated corporations' does not dispense with the necessity of such an allegation. Though it. may control them,-.that which is alleged as its act is not their áct.' Each of them is a legal' entity and must in law act for itself. If The American Tobacco Company holds a majority of'the stock of each ■ of the other associated companies, and; in that ■ way, i. e., by the ■ voting po wer of a majority of stock, controls each corporation, they are still separate legal entities which-must act for themselves. That one corporation or person owns all or. a majority of the. stock of several- corporations does not legally combine them. Each is still a separate entity and subject to the law against combination in restraint of trade, -or any illegal combination, . There can be no combination of such' corporations except by the act or acquiescence of each, the very same as in the case of corporations without such a ■ dominant stockholder common to all. The notion that several corporations with such a common dominant' stockholder are thereby - legally united, and free to act together in restraint of trade, is a false- ons. This complaint is -lacking in any allegation of a combination of the corporations alleged, to refuse to sell goods.to the plaintiffs. There must be such an allegation-; and then it could be made out by evidence of the separate act- of each, or -the; authorized -act of the-defendant The American Tobacco; Company, dr of the defendant The Metropolitan Tobacco Company, as the representative of all.. The trouble is the lack of an allegation under which such evidence would be admissible. . ■ • -
The judgment must be affirmed.
Judgment affirmed, with costs.