stamped in wholesale quantities, no real competition in prices was to be expected.

THE POWDER TRUST

The proceedings against the powder trust were brought on July 30, 1907, and a unanimous decision in favor of the government was rendered by the Circuit Court on June 21, 1911.1 The trust did not appeal from this decision; but proceeded at once to negotiate with the Department of Justice concerning the details of the plan of dissolution. An agreement having been reached, a final decree was entered on June 13, 1912.2 The decree of the court bore a striking resemblance to the decree in the tobacco trust case, and therefore a brief description will suffice.3

The final decree dismissed the petition as to sixteen of the defendants, and dissolved the monopoly maintained by the remaining twenty-seven defendants (twelve corporate and fifteen individual). Eight of the corporate defendants were ordered to dissolve, and to distribute their property among their own stockholders; and three were left undisturbed, so far as their corporate organization was concerned. The remaining corporate defendant was the E. I. du Pont de Nemours Powder Company, the owner of most of the property embraced in the trust. This company was permitted to retain twenty-one of its powder plants, but was obliged to transfer to two new corporations-the Hercules Powder Company and the Atlas Powder Company, both organized for this purpose-its remaining plants, twenty-two in number. In general, the distribution of plants under the decree was such as to make the restoration of competition feasible.

The defendants were enjoined from continuing the illegal combination, and from forming by any device whatsoever any like combination. The dissolution plan was to be put into

1 188 Fed. Rep. 127-156 (June 21, 1911).

2 A copy of the decree is in Decrees and Judgments in Federal Anti-Trust Cases, pp. 195 seq.

3 On the dissolution of the powder trust, see Stevens, Quarterly Journal of Economics, 27, pp. 202-207.

operation by December 15, 1912; and the court retained juris. diction of the case for the purpose of making such further order as might prove necessary.

While no investigation has been made as yet into the results of the dissolution, it is certain that to date they have been slight Within two years after the decree of the Court the war broke out, and down to the close of 1918 the demand for powder was so great that the facilities of powder manufacturers were taxed to the utmost. Prices naturally advanced; and probably the amount of the advance was entirely unaffected by the presence or absence of competitive conditions in the industry. For whenever the demand far outstrips the supply, a competitive price is likely to be the same as a monopoly price, unless the monopoly curtails the supply, as would be quite improbable under the conditions prevailing during 1914-1918. With the termination of hostilities in November, 1918, the demand for powder declined, and prices naturally fell. But meanwhile as the result of the war the general price level for commodities had fundamentally, and perhaps permanently, changed. Even a governmental body with large powers would thus have difficulty in determining the effect of the dissolution on the price of powder. The matter is complicated, moreover, by the fact that the tremendous prosperity of powder companies during the war attracted into the field a host of new concerns, whose competition, if effective, might conceivably bring the price of powder temporarily below a remunerative level. In the light of these facts, it appears that to trace with any approach to accuracy the effect of the dissolution on prices is difficult, if not impossible.

THE SHOE MACHINERY TRUST

Since the fall of 1911 at least four separate proceedings have been instituted by the government against the United Shoe Machinery Company or its officers. The first was a criminal suit brought on September 19, 1911, against the president and other officers of the company, charging them with engaging in a combination and conspiracy in restraint of trade. The de

cision of the Supreme Court dismissing this case has already been described.1

The second was a civil suit instituted on December 12, 1911, asking for the dissolution of the shoe machinery trust. The District Court on March 18, 1915, and the Supreme Court on May 20, 1918, decided adversely to the government. The Supreme Court, as elsewhere noted,2 held that the companies that were combined in the United Shoe Machinery Company in 1899 were complementary, and not competitive. These companies prior to 1899 had individually monopolized various branches of the shoe machinery business, but they were patent monopolies protected by law, and hence their union in a single company was not illegal. The government had also attacked the leases of the United Company, and in particular the socalled tying clauses. But the Supreme Court held that the leases were simply the exercise of the company's right as a patentee.

The third was a proceeding to enjoin a contract alleged to be in restraint of trade in "inseam trimming machines." 3 The petition of the government was filed on February 8, 1913. The prosecution of the case was not pushed, the government preferring to await a decision in the dissolution suit; and presumably with the loss of that case the ancillary proceeding was dropped.

The fourth was an attack on the tying clauses in the shoe machinery leases. These leases had been upheld by the Supreme Court in its decision of May 20, 1918; but subsequent to the bringing of this earlier suit the Clayton Act was passed, and the government brought a new proceeding, on October 18, 1915, charging that the leases violated section three of the Clayton Act. The District Court rendered a decision favorable to the government on March 31, 1920; but the case was appealed to the Supreme Court.

1 See p. 431 (U. S. v. Winslow).

4

2 See p. 432 (U. S. v. United Shoe Machinery Company).

3 Annual Report of the Attorney General, 1913, p. 14.

4 264 Fed. Rep. 138.

THE CASH REGISTER TRUST

A civil suit against the National Cash Register Company was instituted on December 4, 1911. The government alleged a conspiracy to restrain and monopolize trade in cash registers; and asked the Court to enjoin the continuance of the conspiracy and attempted monopoly, and also to enjoin a number of unfair competitive methods. On February 22, 1912, a criminal proceeding was begun against the president of the company and twenty-nine other officials, the charges being substantially the same as in the civil suit. As the prosecution of the civil case was delayed, pending the settlement of the criminal case, the outcome of the latter may be briefly noted. A demurrer to the indictment having been overruled by the district court on June 26, 1912, the defendants, with only one exception, were found guilty, and jail sentences ranging from nine months to one year and fines aggregating $135,000 were imposed.5 An appeal was taken to the Circuit Court of Appeals, where the conviction was set aside on March 13, 1915.6 The government applied to the Supreme Court for a writ of certiorari, which was denied on June 14, 1915. Thereupon the government concluded not to press the case further.

Despite the loss of the criminal suit the government decided to push the civil suit to a conclusion. A decision in the case was never rendered, however; for on February 1, 1916, the National Cash Register Company consented to the entry of a. decree.

The decree granted substantially the relief asked by the government in its petition. It did not, to be sure, enjoin the 1 The Federal Antitrust Laws, July 1, 1916, p. 70. For an account of an earlier suit see p. 441.

2 Petition in United States v. National Cash Register Company, pp. 31-38.

3 The Federal Antitrust Laws, July 1, 1916, pp. 73-74.

4 201 Fed. Rep. 697.

* Decrees and Judgments in Federal Anti-Trust Cases, pp. 795-798.

6 222 Fed. Rep. 599.

7238 U. S. 635.

8 A copy of the decree is in Decrees and Judgments in Federal Anti-Trust Cases, pp. 315-320.

company against further attempting to monopolize interstate commerce in cash registers, nor did it prohibit in sweeping fashion, as requested by the government, the suppression of competition. But it did find that the company had combined to restrain and monopolize trade, and it enjoined the company and its directors, officers, agents, and employees from committing a number of acts. A summary of the acts enjoined well shows the character of the methods whereby the company, aided in considerable measure by the possession of valuable patents, had been able to secure control of 95 per cent of the business of manufacturing cash registers.1

The acts specifically prohibited by the Court were: (1) inducing purchasers of competing cash registers to repudiate the contract of purchase; (2) espionage upon the business of competitors; (3) inducing employees or agents of competitors and dealers in competing machines to sever their connection with the competing concerns; (4) manufacturing or selling cash registers made to resemble competing registers, when sold for the dominant purpose of preventing sales of competing registers; or selling cash registers at a price fixed with reference, not to the cost of manufacture, but to the price of competing machines, for the purpose of eliminating competitors from business; (5) selling competing cash registers, whether obtained by purchase, exchange, or otherwise, for the purpose of preventing sales by competitors; (6) disposing of second-hand registers of the company's make with the object of underselling competitors and driving them from the business, provided that prices made in good faith to meet competition were not prohibited; (7) employing "competition men,' whose principal business was to prevent sales of competing cash registers; (8) following from place to place competitors, their agents and dealers, with the design of hampering their sales; (9) circulating reports reflecting upon the solvency or responsibility of competitors or upon the efficiency of their machines, when such reports were spread as a means of preventing the

The competitive methods of the company are described at considerable length in Petition in United States v. National Cash Register Company, December 4, 1911, pp. 12-29.