(sec. 5). As with the corporate defendants the provisions of this section were to be fully met within two years at the outside (sec. 12). (6) The defendants were perpetually enjoined from owning or operating in the United States, either directly or indirectly, any retail meat markets, except those located at their plants and maintained primarily for the accommodation of their own employees (sec. 6). (7) The defendants were perpetually enjoined from owning, directly or indirectly, any capital stock or other interest in public cold-storage warehouses in the United States, subject to certain exceptions (sec. 7). Immediately upon the entry of the decree the defendants were to proceed with due diligence to divest themselves (to the extent required by the decree) of their retail meat markets and their public cold-storage warehouses, but the approval of the Court to such disposition must be had. At the end of nine months, if these interests had not all been disposed of, the Attorney General might apply to the Court for an order specifying the date by which the transactions should be completed (sec. 11). (8) The corporate defendants were perpetually enjoined from engaging in the United States, either directly or indirectly, in the business of buying, selling, or dealing in fresh milk and cream, except when the milk or cream constituted the raw materials for certain commodities the manufacture of which was permitted to them, and except when their sale was necessary to avoid waste (sec. 8). (9) The corporate defendants were perpetually enjoined from employing any illegal trade practices (sec. 9). (10) For the purpose of enabling the government to ascertain whether the defendants were carrying out the terms of the decree in good faith, the corporate defendants were directed to submit their books, records, correspondence, and other documents to the Attorney General upon his meeting certain requirements, such as written notice of alleged violations, and the like (sec. 16). (11) Jurisdiction of the cause was retained by the Court for the purpose of adding such further relief as might become necessary for the enforcement of the decree (sec. 18). From this brief recital of the terms of the decree it is evident that the dissolution of the beef combination-a combination that threatened, according to the Federal Trade Commission, to control within a few years the wholesale distribution of the nation's food supply-was unusually far-reaching in character. It remains to be seen whether its effect will be to restore competition among the packers in the production of meat and allied products. THE STEEL TRUST A petition to dissolve the steel trust was filed on October 27, 1911. The District Court rendered a decision in favor of the Corporation on June 3, 1915, and the Supreme Court affirmed the verdict on March 1, 1920.1 The outcome of the suit against this mammoth organization is highly significant in its bearing on the effectiveness of dissolution proceedings as a means of solving the trust problem. CONSENT DECREES The foregoing dissolution proceedings deal with trusts that at one stage or another have contested the suits brought against them. Yet in numerous instances the government has been able to secure relief without legal contest; the companies attacked by the government have been unwilling to fight the case, and have consented to a decrec. In very few instances, if any, have these consent decrees involved the physical division of the plants or assets of the companies. Instead they have dealt rather with the future conduct of the trust or combination. One of the trusts that accepted a consent decree was the Aluminum Company of America. The government instituted suit against this company on May 16, 1912. It charged that the Aluminum Company of America had been protected against competition by patents down to 1909, and that thereafter it had endeavored to maintain its monopolistic position by controlling, 1 Cf. p. 438. 2 Petition in United States v. Aluminum Company of America, pp. 1-43 either through purchase or agreements, the essential raw materials, and by employing unfair methods of competition against its would-be rivals. The basis of the aluminum industry is bauxite, a crude ore found in extensive natural deposits. The bauxite is refined into alumina, from which the metal aluminum is made. The Aluminum Company prior to the date of the government suit made large purchases of bauxite properties, and entered into contracts with other concerns, whereby they agreed not to use their bauxite deposits in the manufacture of aluminum, nor to sell them for such purpose to any one but the Aluminum Company of America. The latter entered into an international pooling arrangement with the Neuhausen Company, the largest European producer of aluminum, whereunder the European company agreed not to sell aluminum in the United States. Being almost the sole source of supply of aluminum metal the Aluminum Company was in a position to monopolize the manufacture of aluminum goods, such as cooking utensils, castings, novelties, etc.; and according to the government the company through the use of unfair competitive tactics was rapidly extending its control in these branches. The unfair acts complained of included among others: refusal to supply independent manufacturers with the necessary aluminum metal, often without warning or explanation; purposeful delaying of bills of lading on material shipped to competitors; refusal to guarantee quality, and delivery of defective metal; and charging of higher prices on aluminum sold to competitors than to companies in which the Aluminum Company was interested. The decree of the Court granted on June 7, 1912, declared the agreements with the Neuhausen Company and the American companies to be null and void, and perpetually enjoined the making of any like agreements.1 It also forbade the defendant and its officers and agents ever to enter into any combination or agreement the purpose or effect of which was to control the output or the prices of aluminum or its raw materials, and to enter into any contract or agreement the effect of which was to restrain 1 Decrees and Judgments in Federal Anti-Trust Cases, p. 341. commerce in bauxite, alumina, or aluminum, or to hinder anyone in obtaining a supply of such articles in the open market in free and fair competition. It further perpetually enjoined the employment by the defendant of the unfair practices referred to above. The decree being agreed to by the Alunimum Company of America on the assumption that it had a substantial monopoly of the output and sale of aluminum in this country, it was further provided that whenever it should appear to the Court that substantial competition in the production and sale of aluminum in this country had arisen, the Court upon petition might modify the decree. 3 4 Other leading companies-trusts or important combinationsthat have submitted to consent decrees are: American Coal Products Company; 1 American Thread Company; 2 S. F. Bowser and Company (a combination in pumps, tanks, and outfits used for the storage and handling of gasoline and other inflammable liquids); Burroughs Adding Machine Company; Central West Publishing Company (with the Western Newspaper Union substantially the sole manufacturer of ready-print newspaper matter); 5 General Electric Company; and Otis Elevator Company. Many other companies have consented to decrees, but these are the principal ones. In no instance were the aforementioned companies required to submit to a physical dissolution; the decree merely enjoined certain objectionable practices, though in a few instances it ordered the dissolution of a few subsidiary companies or the sale of some securities. 8 6 In addition a number of associations in restraint of trade have yielded to consent decrees. Among them are the Automobile Bumper Association, the New Departure Manufacturing Company and others (manufacturers of bicycle and motor-cycle coaster brakes and parts), the News-Print Manufacturers' Association,10 and the Southern Wholesale Grocers' Association.11 1 Decrees and Judgments in Federal Anti-Trust Cases, pp. 461-467. 2 Ibid., pp. 449–456. 3 Ibid., pp. 587-592. 4 Ibid., pp. 457-459. 5 Ibid., pp. 359-371. Ibid., pp. 267–273. 7 Ibid., pp. 107-113. Ibid., pp. 471-475. 11 Ibid., pp. 247-251, 802-803. Against a number of important trusts and leading combinations suits are now1 pending. The more important cases are those against the American Can Company, the American Sugar Refining Company, the Eastman Kodak Company, and the Keystone Watch Case Company. The decision of the lower court has been rendered in all of these cases, except in that against the American Sugar Refining Company. The verdict was for the government in the Kodak case, and partly for it and partly against it in the Keystone case. In the Can case the trust was declared to have been organized as an unlawful combination, but the only relief granted was the retention of the bill, that is, the maintenance of court supervision over the company, with power granted to the government to show to the Court at any time, if it could, that the company was using its power to the injury of the public, or that the domination of the company over the industry was so great as to justify dissolution. Appeals in these cases are now pending in the Supreme Court. It is a striking illustration of the law's delays, that though the suit against the American Sugar Refining Company was instituted in November, 1910, a decision by the lower court has not yet been rendered. The case was ready for trial in October, 1915, but the Court ordered the hearing postponed pending the decisions of the Supreme Court in the harvester and steel suits. The former has now been withdrawn from the Court's docket, and the latter after being postponed from time to time has been decided in favor of the company. A partial explanation of the delay in the disposition of the steel case is that the Attorney General on January 2, 1918, asked the Supreme Court to defer argument on this and several other anti-trust suits until the fall term of the Court.3 Meanwhile ten years have elapsed since the suit against the sugar trust was first brought. From the foregoing record it is clear that the program of 1 November, 1920. 2 Annual Report of the Attorney General, 1916, p. 28. 3 Chron., 106, p. 32. It is only fair to the United States Steel Corporation to say that this suspension was opposed by it. |