Court Opinion

ID: 8795752
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:10:18.388989+00
Date Added: 2024-06-11T17:03:37.187036
License: Public Domain

WOOLLEY, Circuit Judge,
with whom HUNT, Circuit Judge, concurs. In an endeavor to state with brevity the matters of law and fact which have directed and controlled my judgment in this case, no *162attempt will be made to review the great mass of testimony or to discuss the law bearing upon it. •
[6] Whether the Steel Corporation is a combination in restraint of trade, or has monopolized, or has attempted to monopolize, commerce among the states'in violation of the Anti-Trust Eaw, depends upon the inherent nature or effect of the combination, the evident purpose of its acts, or the intent to be inferred from the extent of the control secured over the industry, the method by which such control has been brought about, and the manner in which it has been exerted, resulting in prejudice to the public interests by unduly restricting competition or unduly obstructing the course,of trade. United States v. Terminal R. R. Ass’n, 224 U. S. 383, 394, 32 Sup. Ct. 507, 56 L. Ed. 810; Nash v. United States, 229 U. S. 373, 33 Sup. Ct. 780, 57 L. Ed. 1232; Standard Oil Co. v. United States, 221 U. S. 1, 31 Sup. Ct. 502, 55 L. Ed. 619, 34 L. R. A. (N. S.) 834, Ann. Cas. 1912D, 734; United States v. American Tobacco Co., 221 U. S. 106, 179, 31 Sup. Ct. 632, 55 L. Ed. 663.
There is no question that the Steel Corporation is a combination. The question is, whether it is a “combination * * * in restraint of trade,” and whether the corporation, its subsidiaries, and the individual defendants who actively engaged in its organization, monopolized, or attempted to monopolize, or combined with others to monopolize or restrain, trade within the meaning of the act. Inquiry to this end may be pursued along four lines:
First. Was the direct and necessary effect of the organization of the corporation to unduly restrain trade or create a monopoly?
The important business units which at or about the time of its organization comprised the United States Steel Corporation (which in default óf a better term will be called the “constituent combinations”) were the Carnegie Steel Company, Federal Steel Company, National Tube Company, American Bridge Company, National Steel Company, American Steel Hoop Company, American Sheet Steel Company, American Tin Plate Company, and American Steel & Wire Company. Each of. these units was in itself a combination of concerns engaged in the manufacture of the same or allied products. The effect of the organization of these combinations was to suppress competition between their component parts, and the effect of the organization of the Steel Corporation, by embracing these combinations, was to give it a control over the industry equal in the aggregate at least to that which its constituent parts and their subsidiaries had theretofore possessed. The Steel Corporation therefore is a combination of combinations, by which, directly or indirectly, approximately 180 independent concerns were brought under one business control, thereby giving it not only the assets and business of that number of producers, but the advantage of their elimination from the field of competition. It is therefore pertinent to ascertain whether the amount of competition suppressed by the combination of producing units was so great, the percentage of business acquired so large; or the resultant control over the industry so potential, as in and of itself to constitute the Steel Corporation a monopoly, independent of any question of intent.
*163The inherent power or the direct and necessary effect of the corporation to unduly restrain trade must be gathered from what it did with the power it had during the period between the date of its organization and the date of the institution of this suit, and what it was unable to do with that power.
What the corporation did constitutes conduct, a subject which will presently be considered, and what the corporation did not do is so related to conduct that the two will be considered together. "What the corporation had the power, or did not have the power, to do, must first be determined.
The power of the corporation may be ascertained by its position in the industry. Its position has doubtless been attained by a combination of forces, which may include high efficiency of plants, excellence of organization, capacity of employes, and its measure of control over raw materials and the production of finished products. As there can be no monopoly of efficienc3f and capacity, inquiry concerning the power of the corporation therefore leads mainly to its dominion over the raw materials and finished products of the industry.
The ore reserves acquired by the corporation at and subsequent to its organization, the relation which such reserves bear to ore bodies then existing and subsequently discovered, and their bearing upon the’question of monopoly of raw materials, are matters which have been discussed in the preceding opinion, and with the reasoning as well as with the conclusion that the corporation has not a monopoly of the raw materials of the steel industry, I am in entire accord.
A more extended consideration of the power of the corporation, derived from its ore reserves, is unnecessary, further than to dispose of a transaction connected with the acquisition of certain ore properties.
[7] Prior to the organization of the Steel Corporation, John D. Rockefeller became interested in a number of ore properties in the Mesabi Range, in Minnesota, and in properties primarily intended for the transportation of ores to the market. These properties were the Rake Superior Consolidated Iron Mines, which owned a considerable group of iron ore properties in that region; 'a railway company running ftorn Mesabi Range to Duluth, called the Duluth, Missabe & Northern Railroad Company; and a steamship company, owning a group of steamers plying the Great Rakes, called the Bessemer Steamship Company. The mining company owned the railway company. John D. Rockefeller owned 25/29 of the stock of the mining company. He owned all the stock of the steamship compaiiy.
After its formation, the Steel Corporation contracted with John D. Rockefeller for the purchase of his interest and the interest of the other stockholders in the Rake Superior Consolidated Iron Mines and the Bessemer Steamship Company and paid for the latter $8,-500,000 in cash, and for the former, stock of the Steel Corporation at the rate of i35/ioo shares of the preferred and l35/ioo shares of common for each share of the Consolidated Iron Mines, reckoned on a capitalization of $48,000,000; the current market price for the Steel shares being, respectively, 83 and 38.
*164John D. Rockefeller and his son, John D. Rockefeller, Jr., were made directors of the Steel Corporation. The former resigned in 1904, and the latter in 1910. John D. Rockefeller disposed of all of his stock, and John D. Rockefeller, Jr., disposed-of a considerable portion of -his stock in the Steel Corporation, acquired by the aforerecited transaction, prior to the filing of the bill in this case.
The bill charges the acquisition of the Consolidated Iron Mines and Bessemer Steamship Company subsequent to the organization of the corporation. It also charges generally that the individual defendants named in the bill, by the subsequent acquisition and control of properties, entered into a combination with the corporation in restraint of trade; but in this connection the defendants Rockefeller are not named. The sole specific statement of fact in the bill with respect to the defendants Rockefeller relates to the sale to the corporation of stock of the Consolidated Iron Mines and the Bessemer Steamship Company, and the sole specific charge is that these defendants were largely interested in those properties, and that “both of them participated in bringing about the combination and became members of the first board of directors of the corporation.”
By .the prayer of the bill, the properties acquired from the defendants Rockefeller are not asked to be returned to them, or that the sale be avoided, but that the ore properties of the corporation, which of course include those acquired from the defendants Rockefeller be divided among certain corporations contemplated by a decree of dissolution in proportion to their capacity for the production of steel.
There is no evidence or assertion that the purchase of the Consolidated Iron Mines and the Bessemer Steamship Company, and incidentally the Duluth, Missabe & Northern Railroad Company, was included in the original scheme for the organization of the Steel Corporation, nor is there evidence which shows that the defendants Rockefeller took part in the promotion or organization of the corporation. By stipulation with the government, it is in evidence that, at the time the bill was filed, the defendants Rockefeller had no relation of management or control to the Steel Corporation, and there is nothing to show that they were then, or are now violating or threatening to violate the statute.
We find that the transaction of the sale of the Take Superior Consolidated Iron Mines and the Bessemer Steamship Company was no part of the original plan for the fonnation of th'e Steel Corporation; that the transaction was not only in form, but was in substance, h sale; and that the single fact that the purchase price of one of the properties was paid with stock of the corporation does not alter the legal character of the transaction as a sale or prove that it was violative of the statute. We also find that the purchase of these properties from the defendants Rockefeller did not so increase the ore reserves and the transportation facilities of the corporation as to give it a monopolistic power over the raw materials of the industry. For the reasons given, we are unanimously of opinion that the bill should be dismissed as to the defendants Rockefeller.
*165[8] Further inquiring whether the corporation inherently possesses monopolistic-power attention is next given to its proportion of the manufacture and sale of finished iron and steel products of the industry. Upon this subject there is a great volume of testimony, a detailed consideration of which in an opinion would be quite inexcusable. As a last analysis of this testimony, it is sufficient to- say it shows that, large as was the corporation, and substantial as was its proportion of the business of the industry, the corporation was not able in the first ten years of its history to maintain its position in the increase of trade. During that period, its proportion of the domestic business decreased from SO. 1 per cent, to 40.9 per cent, audits increase of business during that period was but 40.6 per cent, of its original volume. Its increase of business, measured by percentage, was exceeded by eight of its competitors, whose increase of business, likewise measured by percentage, ranged from 63 to 3779. This disparity in the increase of production indicates that the power of the corporation is not commensurate with its size, and that the size and the consequent power of the corporation are not sufficient to retard prosperous growth of efficient competitors.
From the vast amount of testimony, it is conclusively shown that the Steel Corporation did not attempt to exert a power, if such it possessed, 'to oppress and destroy its competitors, and it is likewise disclosed by the history of the industry subsequent to the organization of the corporation that if it had made such an attempt it. would have failed. It is also shown by the testimony that, acting independently and relying alone upon its power and wealth, great as they were, the corporation has never been able to dominate the steel industry by controlling the supply of raw materials, restraining production of finished products, or enhancing and maintaining the prices of either.
If in its early history the Steel Corporation, singly and alone, endeavored to dominate the steel industry in any one or several of the customary ways (and such is not disclosed by the testimony), it ceased early to rely upon its own power. In fact, its lack of power to dominate the industry alone is established by the methods it was forced to institute and pursue with respect to the important matter of the fixation of prices, the legality of which, in my opinion, becomes the main point of inquiry in the case. Instead of relying upon its own power to fix and maintain prices, the corporation, at its very beginning, sought and obtained the assistance of others. It combined its power with the power of competing corporations, and then with its competitors concerted, co-operated, contracted, and then by tacit understandings contributed to the establishment and maintenance of prices. The co-operation by the Steel Corporation with its competitors to fix and maintain prices neither sprang from its inherent nature, nor was it the direct and necessary effect of its organization. It constituted conduct, and conduct of the same character as that pursued by the corporation’s competitors participating therein. The testimony does not show that the corporation in and of itself ever possessed or exerted sufficient power when acting alone to control prices of the products of the industry. The testimony abundantly shows that the power of the corporation to- control prices was efficient only when in co-operation with its competitors. It has never *166raised and maintained prices by its own action. It has done it only by joint action, and when joint action was either refused or withdrawn, the corporation’s prices were controlled by competition. To the conduct of the corporation in fixing and maintaining prices by methods it with others employed the charge of violation of the statute is most pertinently addressed.
Distinguishing the power of the corporation from its conduct subsequent to its organization, I am of opinion, for the reasons here given, that in its inherent nature the Steel Corporation is not a monopoly, and that the direct and necessary effect of the organization of the corporation was not unduly to restrain trade.
[9] Second. Was^n intent to monopolize or to unduly restrain trade shown by the circumstances which led up to and surrounded the organization of the corporation?
For several years preceding the organization of the corporation in 1901, the steel industry was undergoing a revolution in business methods. Combinations of manufacturers producing the 'same, as well as diversified products, were formed upon tremendous scales, embracing in many instances a majority, and in some instances nearly all, the producers of a particular product. This industrial revolution and the combinations which grew out of it have been explained upon two theories.
The first theory is based, as it is contended, upon the discovery made at or about .that time that the economic manufacture of a finished steel product required the ownership of fhe raw material and the manufacture of the unfinished product by the same corporation, and the manufacture of the unfinished product required facilities for finishing the same in order to secure a regular and certain output. In other words, a necessity for integration developed, that is, the manufacture of steel products on a large scale, beginning with the ore and concluding with the finished product, to accomplish which aggregations of mills that produced different commodities were essential. That this was in the minds of the steel masters of that day is without question, and it is now contended by the defendants that to attain this was the object of the formation of the Steel Corporation.
' The other theory advanced in explanation of the tremendous and rapid combination of steel-producing plants at that period, in which less regard was paid to combining plants producing diversified products than to combining plants producing the same products, is that by such combinations, competition in trade could be suppressed to an extent commensurate with the amount of trade combined, and that by the resultant control, prices could be raised and maintained that would yield great profits.
Much testimony has been produced in this case by the opposing parties in support of and in opposition to these opposing theories, a review of which within the limits of an opinion is quite impossible to be made. Evidence of the acts and things done at the time they were done, the character of the combinations made, and the results then and subsequently attained, as disclosed by testimony which corresponds in point of time with the doing of the things, carry to my *167mind a greater probative force in determining the reasons for the combinations and the purpose of the organization of the Steel Corporation than explanations thereof made at after periods. There is much testimony given by witnesses, looking back over the history of the corporation and its constituent combinations, to the effect that the purpose of the organization of the constituent combinations and then of the larger combination, the Steel Corporation, was to assemble huge properties so as to procure perfect integration. Yet the testimony which impresses me most is that which relates to and concerns the things said and done preliminary to and connected with the organization of these various combinations' at the time of their creation. These circumstances indicate that the various combinations were made upon a scale that was huge and in a maimer that was wild. Properties were assembled and combined with less regard to their importance as integral parts of1 an integrated whole than to the advantages expected from the elimination of the competition which theretofore existed between them.
Without referring to the great mass of figures which bears upon this aspect of the case, it is clear to me that combinations were created by acquiring competing producing concerns at figures not based upon their physical or their business values, as independent and separate producers, but upon their values in combination; that is, upon their values as manufacturing plants and business.concerns with competition eliminated. In many instances, capital stock was issued for amounts vastly in excess of the values of the properties purchased, thereby capitalizing the anticipated fruits of combination. The control acquired over the branches of the industry to which the combinations particularly related measured by the amount of production, extended in some instances from 80 per cent, to 95 per cent, of the entire output of the country, resulting in the immediate increase of prices, in some cases double and in others treble what they were before, yielding large dividends upon greatly inflated capital.3
*168The immediate, as well as the normal effect of such combinations, was in all instances a complete elimination of competition between the concerns absorbed, and a corresponding restraint of trade. That for a time during that period monopoly was created and trade unduly restrained in certain steel products by the combinations which almost exclusively produced them is seriously charged and not satisfactorily denied. Such was the common knowledge of those conversant with the steel industry; and, as many of the men who participated in the organization of such combinations participated actively in the organization of the Steel Corporation, it is difficult to believe that they did not know that to some extent, and probably to what extent, such combinations restricted and suppressed competition, and that they did not expect, by force of the multiplied absorption of trade and by the power resulting from the increased elimination of competition, the Steel Corporation would be enabled to fix and regulate the production and prices of all commodities in the industry. Such would seem to be a natural thing to expect of a combination of competing corporations which in themselves were combinations of competing corporations, and it is but fair to charge that those who created such a combination of combinations intended what in the nature of the situation would be thought to be its natural and probable consequence.
It was insistently urged by the corporation, both in the briefs and at the arguments of this case, that in the conversations between Mr. Schwab and Mr. Morgan preliminary to and during the negotiations for the combinations which were afterwards acquired by the Steel Corporation, no word passed between them concerning increased profits hoped for or expected to be derived from the elimination of competition, and that their discussions were addressed and limited to economies of manufacture and business. It is worthy of comment in this connection that, in so far as those conversations are repeated in the testimony, the word “integration” was not mentioned, and, excepting by inference, the idea of integration was not suggested by the one who gave, or by the one who responded to, the inspiration to create such a combination as the Steel Corporation. The purpose of its organization, in so far as it was expressed by either of those gentlemen, as disclosed by the testimony, was to acquire a number of mills in each of which to manufacture but one thing instead of many things, and to procure enough mills to make and manufacture every product in the steel industry, with the hope of acquiring the foreign trade. The precise reasons for the formation of such a combination, and the particular advantages to be expected therefrom, as *169stated by Mr. Schwab to Mr. Morgan, in the conversations which are represented to contain the ideas which suggested and which justified the formation of the Steel Corporation, are:
“That instead, as was then the practice, of having one mill to make 10 or 20 or 50 products, the greatest economy would result from having one mill make one product and make that product continuously; * * * that various lines of steel should be so specialized; * * * that great economies would result from locating mills at the point of consumption by which the cost of transportation. * * * would be reduced or saved; * * * that great economic results would follow from being able to manage these concerns in a manner that would stimulate the most effective effort in the management of the different concerns; * * * that the great export business of this country in iron and steel could only be done in that way; * * * ” the companies to be acquired were “such as to cover all the branches of the industry, * * * ” and that “successful manufacture was only possible where every single step in the line of manufacture was carried out by some one concern; and that for the greatest economy, for the greatest development of the business, it was an absolute necessity.”
Continuing, Mr. Schwab said:
“I felt, furthermore, that great economies would result in all these general items of expense which are mot in the manufacture of iron and steel on account of selling, traveling, office expenses, and all the general items of each individual concern which an individual line had to cover with a full organization. That could be covered by one such organization, and 1 felt that such economy would result in that direction, and indeed the whole line of my talk that evening was intended to show that the next great economic step to be made in the manufacture of steel — or indeed any business in general; I did not coniine myself entirely to the steel business, directly to the steel business-hut in general that the great economic result to be next obtained in manufacture was in the direction of these methods, and then I made that application generally to the steel industry.”
Mr. Schwab then pointed out to Mr. Morgan the plants, which if acquired, “could he made ultimately to conform to this theory.” It does not appear in the testimony just what plants Mr. Schwab suggested should be acquired, nor does it appear that Mr. Morgan acquired, or attempted to acquire, any plants of any independent producers of that day. It does appear, however, that Mr. Morgan proceeded immediately to acquire, not plants, but the huge combinations themselves which had but recently been formed, and which had but recently demonstrated their ability to suppress competition.
The objects of the formation of the corporation, as stated by Mr. Schwab, were those avowed at the time of its organization, and the things done to accomplish those objects must be accepted to have been done in the light of the situation as it then existed.
The declarations of Mr. Schwab with respect to the objects of the organization, and the conduct of Mr. Morgan and his associates in creating the corporation by combining the most powerful combinations which then existed, the conspicuous features of which were overcapitalization, and the elimination of competition, constitute evidence which must he considered in seeking the purposes for which the corporation was organized. That evidence, as against the testimony to the contrary, impels me to the opinion that the primary purpose of the organization of the Steel Corporation was not integration. Integration was a result of the organization, and afterward became a neces*170sity. When integration was undertaken it was hut imperfectly accomplished by employing the units acquired. It was only perfected by building new mills at a cost' of over $400,000,000. After a consideration of the character and conduct of the combinations absorbed by the corporation, and of the complete knowledge of the industries possessed by those who brought the corporation into existence, I am irresistibly drawn to the conclusion that the object of the formation of a corporation which embraced such combinations, and the intent of those who undertook its accomplishment, were to secure great profits by restraining trade in the manner and upon the scale thought possible in the light of the history of the constituent combinations.
The constituent combinations absorbed by the corporation were strongest at their birth. Their percentage of output and their corresponding control over their particular branches of the industry were greatest when organized, but diminished year by year in combat with competitors who entered the field against them, supplied with ample resources, equipped with modern plants, and unincumbered with obsolete or dismantled properties. As an illustration, the American Tin Plate Company, incorporated in December, 1898, was a consolidation of 39 plants with 279 mills engaged in the manufacture of tin plate. It is charged and not denied that at the time of its formation this comr bination comprised 90 per cent, of the tin plate manufacturers of the country, which controlled 95 per cent, of the total output of tin plate in the United States. ■ The result was an immediate rise in the price of its product and a decrease in the number of its producing units. As a consequence of its policy, 86 mills of. 19 plants, about one-third of the mills acquired, were promptly dismantled. Notwithstanding this initial and potential control over the product and prices of the tin plate industry, it nevertheless happened that while in 1899 the American Tin Plate Company produced 95 per cent, of all the tin plate manufactured in the United States, its control from that year gradually decreased until in 1912, its proportion of the manufactured output was but 53.7 per cent. After it was absorbed by the corporation, it ceased to rely upon its own power to fix and maintain prices, complete as was its power at first, and, like the other subsidiaries, was forced to co-operate with its competitors.
The experience of the American Tin Plate Company is illustrative of the history of various combinations absorbed by the Steel Corporation. It is likewise the explanation of the seeming anomaly that the corporation, at the time of its organization, in and of itself, possessed less power as a monopoly than certain of its constituent units possessed at the dates upon which they were respectively created. The' absorption by the Steel Corporation of combinations which in themselves possessed monopolistic powers, potential in their beginning, though waning as they progressed, irresistibly draws me to the conclusion that those who organized the Steel Corporation expected to accomplish permanently what had been demonstrated could be accomplished temporarily, and thereby to monopolize and unduly restrain trade. But when organized, the corporation discovered that it was confronted by forces beyond its control, that it was affected by *171trade laws and conditions which in its organization were either forgotten or ignored, and that therefore it was without the power alone to do what its organizers expected of it, and was immediately forced to resort to the old device of pools in order to control and maintain the prices of its products. I am of opinion that the circumstances which led up to and surrounded the organization of the Steel Corporation show that those who organized the Steel Corporation intended it to monopolize and unduly restrain trade.
Third. Was intent to monopolize or to restrain trade shown by the after conduct of the corporation?
There are a number of customary tests by which the existence of trade restraint may be ascertained and the extent thereof may be gauged. In applying these tests to the after conduct of the corporation, the testimony responds, in my opinion, by disclosing but one line of the corporation’s conduct violative of the statute.
There is nothing in the evidence that suggests that the corporation used its power to gain advantage over its competitors by securing freight rebates. On the contrary, it appears that early in its history the corporation announced a policy and promulgated a rule against soliciting and accepting rebates.
There is nothing show that the corporation increased its profits by reducing the wages of its employes. The increased volume and reward, as well as the improved conditions of labor, for which the corporation, at considerable length, takes credit to itself, have no bearing upon the issue of monopoly, except as they tend to prove that monopoly was neither attempted nor acquired at the expense of labor.
There is nothing in the evidence that suggests the corporation increased its profits by lowering the quality of its products. The testimony that the quality of the corporation’s products has not deteriorated, but has improved, is pertinent to' the inquiry whether monopoly was attempted or accomplished at the expense of the quality of its products, but the considerable volume of testimony as'to the high quality of its products and the excellence of its service has no probative bearing upon the issue of monopoly. The question is not whether the corporation is a serviceable monopoly. The question is whether the corporation is a monopoly.
There is nothing which discloses that the corporation either increased its power or augmented its profit by creating an artificial scarcity of its products.
The testimony does not show that the corporation oppressed or coerced its competitors. In fact, there is an abundance of testimony contributed by the competitors of the corporation to the effect that its competion, though vigorous, was fair.
The corporation did not undersell its competitors in particular localities, by reducing prices below the prices at which it sold in other localities, nor did it require its customers to enter into contracts either limiting their purchases to the corporation or restricting them in resale prices. While purchasing pig iron at prices higher than the market, in order by reflection to maintain or increase the price of steel, purchases were not made by the corporation beyond its needs, nor with the intent or re-*172suit of cornering the market. It did not obtain customers of competitors by secret rebates, or departures from its published prices, so long as the prices agreed to were adhered to by others pursuant to methods presently to be considered. There is no evidence that it attempted to crush its competitors or drive them out of the market, and in its competition it seemed to make no distinction between large and small competitors. In fact, its conduct towards its competitors, as shown by the testimony, has been conspicuously free from that business brutality, meanness, and unfairness which characterized the conduct of certain large corporations found guilty, of violating the Anti-Trust L,aw.
The charge that the corporation offered lower prices in return for large purchases running over long periods, if true, does not constitute unfair trading. In those instances, the corporation endeavored and succeeded in obtaining contracts for large purchases of unfinished, or. semifinished materials, so as to secure a steady trade for a long period, and thereby secure steady and certain employment for its mills.
. The corporation’s reply to the charge-of undue restraint of trade, by combining with others to. fix and maintain prices, and the assumption to itself of credit for the benefits arising from its conduct “in steadying the market and preventing rapid and extreme fluctuations,” is somewhat of an admission that it (with others) controlled prices by artificial means. I know of no law which makes the steadying of the market a justification for fixing and maintaining prices by the concerted action of otherwise competing companies, -when the effect of steadying the market is to dominate the industry by establishing prices for its products. The perfection of stabilizing prices can be reached only when monopoly is perfect, and as nothing justifies monopoly, I am of opinion that the stabilizing benefits claimed by the defendants in fixing and maintaining prices are no justification or excuse for what they did. Prices are perfectly stabilized by pools, when entered into and lived up to, yet no one would contend that a pool, however beneficent its results, is either justifiable or legal. If the establishment of uniform prices for the products of an industry should ever be found advantageous or necessary, such an economic policy should be inaugurated and pursued under authority of law, and not by the will of the industry itself.
Competition with the corporation in all of its products has beem real and keen from the date of its organization to- the date of the filing of the bill in this suit. About this there is no question, with the possible exception of seamless tubes, which were made under important patents acquired or controlled by the corporation. Every commodity which it made was sold in substantial competition. This is conclusively proved. It is not proved, however, that the competition which existed between the corporation and its competitors extended to prices. AVhile during that period competition was real, it was pursued along levels and at figures agreed upon expressly or tacitly by pools, or at meetings and dinners. At different times when price undertakings and understandings between the corporation and its competitors were broken, notably in 1909, the feature of prices entered into the competition, and then competition was complete and without restraint. Otherwise, and at other times, competition was real, but it was restrained as *173to prices. Therefore, in searching the after-conduct of the corporation for evidence of an intent on its part to monopolize and restrain, trade, the participation of the corporation in the old and the new means pursued and devised, by which prices were raised and maintained, demands serious consideration.
Before and at the time of the organization of the corporation, and for several years thereafter, a great many of the companies that became its constituents and subsidiaries were allotting trade and fixing prices for different iron and steel products by pool agreements. It is quite unnecessary in this opinion to discuss the legality of such agreements. It is sufficient to state that it was known by all that they were denounced by the law. With this knowledge, the corporation, through its president, in 1904, commanded its subsidiaries to withdraw from pools, yet notwithstanding the policy then announced, certain of its subsidiaries, notably the American Steel & Wire Company, continued in pools formed as late as 1908. It is defended, however, that the participation of the American Steel & Wire Company in the pool last mentioned was without the sanction of the corporation and without the knowledge of its president. It is really unimportant to give consideration to the corporation’s claim of exoneration upon this ground, in view of the fact that the corporation itself, with the concurrence o E its president, at the very same time, at periodical meetings with its competitors, was fixing prices covering a wide range of commodities, not by agreements, but by understandings by which all were morally bound, and from which no' one deviated without notice to the others. By these methods the corporation and its subsidiary, the American Steel & Wire Company, were contemporaneously and quite as effectually naming and maintaining prices in different products. Measured by the successful results of each, there can be little difference between the methods employed.
When pools and associations were very generally abandoned in 1904, they were succeeded by trade meetings attended by representatives of the same concerns which thereto Core had been parties to the pools. At these meetings agreements respecting prices were not made, but understandings were reached with respect to prices which quite as effectually resulted in their maintenance. The legality of these meetings was questioned, and about the year 1907 they were abandoned, and, in the same year the Gary Dinners were inaugurated.
The Gary Dinners were dinners given by E. H. Gary, the president of the corporation, to which were invited representatives of steel-manufacturing concerns which theretofore had participated in the trade meetings, associations, and pools, and which produced “90 per cent, or more” of the total output of the diversified products of the steel industry of the country. ,
The first Gary Dinner was given on November 20, 1907, to meet an unquestioned exigency arising out of the panic then existing. The steel industry, like many industries, was demoralized and threatened with disaster by the panic which began in the month preceding. The dinner was given in order to devise ways and means, to prevent calamity to the industry. Ways and means were found which no doubt con*174tributed greatly in preventing disaster, not alone to the producers of steel, but also to those intermediate consumers who were carrying large and costly supplies,. The ways and means consisted then of nothing more than the urgent request of a strong man that in the stress of panic all should keep their heads and avoid the consequences of reckless cutting of prices. In this-the others acquiesced, and in the light of the emergency then existing, and the disaster averted, I am of opinion that the purpose and the conduct of those who participated in the first Gary Dinner were not unlawful, improper, or questionable. But after the exigency had passed, and the means to meet it had been exerted, Gary Dinners were found to be potential things, and they were afterwards called and employed to exert their potentiality, not in averting disaster, but in creating greater profits, by raising and maintaining prices in periods of industrial calm.
Gary Dinners, while not regularly held, never adjourned. They were made continuous by the peculiar character of their organization. Being nothing more than business meetings, they were conducted in a business fashion. A general supervisory committee was appointed, and subcommittees were appointed to deal with the different products of the steel industry. These latter committees were known as the Steel Bar Committee, Ore and Pig Iron Committee, Rails and Billets Committee, etc. The membership of each committee was composed of representatives of the leading concerns which manufactured the particular product with which the committee had to do. - These committees met between dinners and were accessible, through their chairmen, at all times between meetings. The only difference between the Gary Dinners and the meetings of the committees was that at the dinners the general business of the industry was discussed, while at committee meetings the business of a particular branch of the trade was discussed. At neither were agreements made concerning prices at which the participants would sell their products. In fact, it was asserted and reasserted that such agreements were impossible, -because illegal; but in lieu of agreements, the parties, both at the dinners and at the committee meetings, severally made what they chose to call “declarations of purpose” — that is, declarations of the prices at which they respectively proposed to sell their products, to which prices it is testified all adhered until some one chose to deviate therefrom, in which event he was “in decency” bound to notify his dinner associates or the members of his committee.
Excepting the feature of trade allotments and money penalties, Gary Dinners were in effect pools, with the right reserved to each participant to withdraw upon notice to the others. They differed from pools, only in the difference between the binding force of a moral understanding and the .legal obligation of an express agreement. They were pools without penalties. They constituted a scheme which did not make it fatal for a competitor of the corporation to stay out, but made it attractive for him to stay in, the result of which was that prices were maintained with greater uniformity and stability than when the same participants engaged in pool agreements, violations of which carried penalties.
*175This method of co-operative price regulation was pursued uniuterrufftedly from November, 1907, to February, 1909. Throughout this time prices were fixed and maintained by “understandings” enforced by “moral obligations.” Through the period of depression of 1908, business so decreased in volume that early in 1909 independent producers broke their “understandings” with the corporation and with one' another, arid sold at prices which each fixed for itself, in complete disregard of previous “understandings.” The corporation attempted to maintain for its products prices at the figures understood; that is, to maintain high prices in a period of business depression, and “to force the issue against all economic conditions.” It attempted this alone, and in its attempt it failed. Therefore, in that year, the corporation was forced to declare for an “open market”; that is, it sold at prices with respect to which there were no “understandings,” and permitted “natural laws” to take their course. The immediate results were lower prices and a largely increased volume of trade. If the abandonment by the corporation of its co-operative policy of fixing and maintaining prices “brought out a large volume of business,” it logically follows that by the pursuit of that policy “a large volume of business” had theretofore been held back — that is, restrained — and therefore that the policy of co-operation as to prices, based upon mutual understandings and enforced by moral obligations, operated effectually and unduly to restrain trade.
That the corporation did not dominate the industry by compelling the trade to. sell at prices it desired is shown by the break of 1909. When the independents broke away, the corporation had to break away too-. When the independents lowered prices, the corporation had to lower prices too. When they all broke away, two things happened: First, competition in prices; second, an increased volume of trade, indicating theretofore a limitation of the former and the restriction of the latter. This is persuasive evidence that the establishment and maintenance of prices from 1901 to 1909 were accomplished by the corporation and its competitors, by keeping agreements made by pools and adhering to understandings reached at meetings and dinners.
Coincident with the breaking of prices by the breaking of understandings made or reached at Gary Dinners, Gary Dinners were temporarily discontinued. It has been contended all along that Gary Dinners had nothing to do with the fixation and maintenance of prices; that while stabilizing prices resulted from such dinners, nevertheless their primary purpose was to secure the establishment and maintenance of good relations between competitors, and to afford opportunities for the exchange of trade information and experience. Is it not strange that a breach of an understanding as to the one matter of prices should have caused a discontinuance of the dinners, with the consequent loss of their primary benefits ?
■ Gary Dinners were resumed in October, 1909, and with their resumption higher prices were resumed.
By the proceedings at the Gary Dinners, and at the meetings of the dinner committees, the fixing and maintaining of prices were *176as successfully accomplished as- by meetings called for that purpose during the period from 1904 to 1907, and by the pools crested for that purpose from 1901 to 1904. It therefore appears that from the organization of the corporation in 1901 until the Gary Dinners were discontinued in January, 1911, the corporation, first by one method, and then by a second method, and then by a third method, employed means to procure the establishment and maintenance of uniform prices for its diversified products, and by these means the Steel Corporation, with its competitors, did combine and control prices, and in controlling prices restrained trade. If by the three methods pursued, in the three periods named, prices were not artificially and successfully maintained, as shown by the history covering those three periods, I am at a loss to know by what means it would be possible to fix and maintain prices that would unduly restrain trade in the sense of violating the Anti-Trust Law.
The raising and maintaining of prices of steel products from 1901 to 1911 cannot be attributed to the dominancy by the corporation over the industry, because of its size. It was due to co-operation between it and nearly all other producers in a joint effort to raise and maintain prices, in which they persisted and succeeded. Without the co-operation of independent producers, prices of steel products could not have been raised and maintained by the corporation alone. The offense of the corporation, therefore, was not its dominancy over the trade, but was an offense precisely similar to that of which every independent and co-operating producer was guilty, and consisted in the act of combining with its competitors, to produce an unlawful result. If it had not combined with its competitors, or if they had not combined with it, restraint of trade, due to the fixation of prices, would in my opinion have been impossible. Therefore those who participated in such meetings, with the intention of doing that which was accomplished, participated in unlawfully restraining trade. I am in no wise convinced that those competing corporations which associated themselves with the Steel Corporation, were forced, either by the conduct or the power of the corporation, to co-operate with it in fixing prices. The corporation produced less than 50 per cent, of the steel products of the country. .Those of its competitors which participated with it in the fixation of prices produced more than 40 per cent. Those which comprised the 40 per cent, could have taken care of themselves, and could have competed with the corporation in prices, if they had so desired, and therefore those which comprised the 40 per cent, and which co-operated with the corporation in the methods pursued from 1901 to 1911 did so voluntarily, and not because of the dominance of the Steel Corporation. The corporation dominated only in the sense of contributing substantially to what was done and making attractive what it desired to be done, and the others yielded cheerfully. Their offense was no different from that of the corporation, and the offense of the corporation was distinguished from theirs only in the leadership it assumed in promulgating and perfecting the policy.
The record does not disclose the names of all the iron and steel *177producing concerns which were represented at the Gary Dinners, and which co-operated in the price-fixing policy there inaugurated and pursued. Those corporations which were of sufficient siz'e and importance to secure representation from time to time upon the principal committee and the subcommittees of the Gary Dinners, including the Steel Corporation, its subsidiaries, and its competitors, appear by stipulation (Record, volume 9, pp. 3745-3750), which is excerpted in the margin.4
The Anti-Trust Law was enacted “to protect trade and commerce against unlawful restraints and monopolies.” The word “trade” means the buying as well as the selling of property, and the statute extends its protection to those who buy as well as to those who sell. A practice that is helpful to the seller, but is hurtful to the buyer, is as fully within the inhibition of the statute as a practice pursued by one seller which unlawfully restrains the trade of another seller. Therefore it may be assumed without discussion, that the statute intends to protect the purchasing public from the consequences of combinations, which, either in their purpose or effect, so raise and maintain prices that trade, in the sense of buying, cannot exist except upon terms fixed by combinations of sellers.
When the Steel Corporation and its competitors, which together produce 90 per cent, of the iron and steel output of the country, com*178bined, and first by one method, and then by another, and then still by another, deliberately fixed and successfully maintained almost uninterruptedly for a period of 10 years the prices at which the public was compelled to purchase their products, I am convinced that the corporation and every producer which combined with it and with one another in so fixing and maintaining prices violated the provision of the statute which declares illegal “every * * * combination- * * * in •restraint of trade or commerce among the several states. * * * ”
Fourth. Was the corporation engaged in restraining or monopolizing trade, or was it threatening so to do,.at the institution of this suit?
As the several means resorted to by the corporation, with others, for raising and maintaining prices constitute, in my opinion, the only conduct of the corporation violative of the statute, the first part of the question just propounded may be answered by .ascertaining when that conduct ceased. The Gary Dinner movement ended with the dinner of January 11, 1911, and the bill in this suit was filed on October 26, 1911. The testimony does not show that since the-date of the last Gary Dinner the corporation, either alone or -in co-operation with others, has fixed or maintained prices of the products of the steel industry, or attempted so to do, nor does the testimony disclose anything which suggests an intention on the part of the corporation to return to its former practices. That it may do so, if it desires, unless prevented by the decree of this court, is of course obvious.
My conclusions of fact and of law are that the organizers of the corporation (1) intended to create a monopoly and to restrain trade, and ,(2) combined with others and attempted to monopolize trade, within the meaning of the act, and that the corporation (1) neither attempted nor possessed the power alone to do the unlawful things intended by its formation, but (2) that it unlawfully combined with others to restrain trade by controlling prices.
[10] Whatever remedy there may be against the organizers of the corporation for acts violative of the statute, certainly in this proceeding in equity a decree of dissolution cannot be awarded against the corporation for the unlawful intent and the unsuccessful attempt of its organizers to violate the law. Upon the finding that the corporation, in and of itself, is not now and has never been a monopoly or a combination in restraint of trade, a decree of dissolution should not be entered against it. Having found, however, that the corporation violated one of the provisions of the statute by combining with others to unduly restrain trade, and that it possesses the power to again unlawfully combine with others to do the same unlawful acts, and though not actively threatening, yet because of the disposition displayed throughout the larger portion of its history, it may again do so, I am of opinion, that the corporation ,should be prevented doing the things and repeating the practices respecting the fixing and maintaining of prices herein viewed illegal. The' ordinary relief, obviously, is the injunction process of the court, which, in an ordinary situation, would follow such a finding as of course. I am satisfied, however, that the same end will be attained, in a manner consistent with recent legislation, by retaining jurisdiction of the bill, if desired by the government, for the purpose *179of restraining the defendants against engaging in the price fixing practices found illegal.
Having stated the reasons for my conclusions, and the matters which have principally controlled my judgment in this case, I join in the decree to be entered.

 Tile organization of the constituent combinations, their overcapitalization, and the increase in the prices of their products are matters so complex in their recital, and embrace such a considerable portion of a record altogether unprecedented in size, that nothing more than a single instance can be briefly stated in a footnote.
The National Tube Company was incorporated in February, 1899. It was a combination of manufacturers representing from 80 to 90 per cent, of the production of iron and steel wrought tubes in the United States. (V, 1891, 1913; G. E., V, pt. II, 1785, 1794.) An expert valuation oí the properties acquired, exclusive of the Western Tube Company, was the sum of $22,808,500. (V, 1SG7-72.) For the properties and plants, so valued at $22,808,500, personal assets estimated at $10,000,000, and $2,500,000 cash furnished by the promoters, making a total of $34,803,500, plus the value of a part interest in the Western Tube Company, the National Tube Company issued to the consolidation purchasers over $79,000,000 in stock. (G. E., No. 2, 381-381, 392-394.) Of the approximate amount of $10,000,000 of preferred and $-10,030.000 of common issued to the consolidation purchasers for the properties acquired by it (G. E., II, 372-39-1), it appears that the common stock received by the consolidation purchasers to the amount of about $40,000,000 was to he distributed approximately as follows: To the vendors of the properties acquired, between $8,000,000 and $11,000,000 in excess of the cash valuations of their properties; to the syndicate'in excess of the amount of cash furnished *168by it $5,000,000; to Morgan & Co., $3,500,000; and to tbe consolidation purchasers and Morgan & Co. for promotion between $20,000,000 and $28,000,000. Tbe net earnings of tbe National Tube Company for tbe first six months were $7,909,060, a rate of 19 per cent, per annum on tbe capitalization of $80,000,-000; and tbe net earnings for tbe first fiscal year, after deducting expenses, depreciation, and reserve, were $13,878,364.69, which is something over 17 per cent, on its total capitalization. Before the formation of tbe National Tube Company tbe price of tubes was $30.00 a ton. During 1899, tbe year of its formation, tbe prices of tubes rose to $67 a ton, and in tbe early part of 1900, reached their maximum of $89.00 a ton (XXVII,' 11390, 11391, 11426, 11427,' 11433).

 General Committee. — United States Steel Corporation. Competitors: Cambria Steel Company, Pennsylvania Steel Company, Bethlehem Steel Company, Jones & Laughlin Steel Company, Central Iron & Steel Company.
Ore and Pig Iron Committee. — United States Steel Corporation. Competitors: Shenango Furnace Company, Pickands, Mather & Co., Bessemer Pig Iron Association, Republic Iron & Steel Company, Thomas Iron Company, Sloss-Sheffield Iron & Steel Company, Buffalo & Susquehanna Iron Company, /Warwick Iron & Steel Company, Allegheny Ore & Iron Company.
Rails and Billets. — Illinois Steel Company, subsidiary. Competitors: Pennsylvania Steel Company, Lackawanna Steel Company, Dominion Iron & Steel Company, Alan Wood Iron & Steel Company.
Billets and Sheet Bars. — Carnegie Steel Company, subsidiary. Competitors : Pennsylvania Steel Company, Republic Iron & Steel Company, Lackawanna Steel Company, Jones & Laughlin Steel Company, Youngstown Sheet; & Tube Company, Alan Wood Iron & Steel Company.
Structural Material. — Illinois Steel Company, subsidiary. Competitors: Bethlehem Steel Company, Cambria Steel Company, Jones & Laughlin Steel Company.
Plates. — Carnegie Steel Company, subsidiary. Competitors: Cambria Steel Company, Central Iron & Steel Company, Lukens Iron & Steel Company, Worth Bros. Company.
Steel Bars. — Carnegie Steel Company, subsidiary. Competitors: Jones & Laughlin Steel Company, Republic Iron & Steel Company, Crucible Steel Company of America, Cambria Steel Company.
Pipes and Tubular Goods. — National Tube Company, subsidiary. Competitors : Wheeling Steel & Iron Company, Youngstown Sheet & Tube Company, Reading Iron Company, La Belle Iron Works.
Sheets and Tin Plate. — American Sheet & Tin Plate Company, subsidiary. Competitors: La Belle Iron Works, Inland Steel Company, National Enameling & Stamping Company, Youngstown Sheet & Tube Company.
Wire Products. — American Steel & Wire Company, subsidiary. Competitors: Pittsburgh Steel Company, John A. Roeblings Sons Company, Grand Crossing Tack Company.