Argument for the United States.

ent case render such a conclusion impossible. The things done had direct reference to interstate and foreign [117] commerce; competition therein has been effectively destroyed and monopoly secured. In support of the foregoing doctrines, see United States v. E. C. Knight Company (1895), 156 U. S. 1; Pearsall v. Great Northern R. R. Co. (1896), 161 U. S. 646; United States v. Trans-Missouri Freight Assn. (1897), 166 U. S. 290; United States v. Joint Traffic Assn. (1898), 171 U. S. 505; Hopkins v. United States (1898), 171 U. S. 578; Anderson v. United States (1898), 171 U. S. 604; Addyston Pipe & Steel Company v. United States (1899), 175 U. S. 211; Montague & Company v. Lowry (1903), 193 U. S. 38; Northern Securities Company v. United States (1904), 193 U. S. 197; Harriman v. Northern Securities Company (1905), 197 U. S. 244; Swift & Company v. United States (1905), 196 U. S. 375; Cincinnati et al. Packet Co. v. Bay (1906), 200 U. S. 179; Loewe v. Lawlor (1908), 208 U. S. 274. See also National Cotton Oil Co. v. Texas, 197 U. S. 115; Shawnee Compress Co. v. Anderson, 209 U. S. 423; Continental Wall Paper Co. v. Voight, 212 U. S. 227; Pennsylvania Sugar Refining Company v. American Sugar Refining Co., 166 Fed. Rep. 254: Bigelow v. Calumet & Hecla Mining Company, 167 Fed. Rep. 704, 721; National Fireproofing Company v. Mason Builders Assn., 169 Fed. Rep. 259; United States v. Standard Oil Co., 173 Fed. Rep. 177.

Monopoly is the outcome of the practical cessation of effective business competition. This word in the AntiTrust Act has no reference to a grant of special privileges but is used in a broad sense. Trade and commerce in any commodity are monopolized whenever as the result of the concentration of competing businesses-not occurring as an incident to the orderly growth and development of one of them one or a few corporations (or persons) acting in concert practically acquire power to control prices and smother competition.

The rights of an individual acting alone are not involved and it is unnecessary to inquire how far his acts [118] may be limited. Corporations do not have all the con

Argument for the United States.

stitutional rights of an individual and are themselves combinations subject to the rules of law applicable to acts done in concert.

The word "monopolize" has no reference to a governmental grant. Congress was striking at an existing evilunification of control with consequent destruction of competition through powerful organizations. The essential idea of monopoly is ability to control prices or to deprive the public of advantages flowing from free competition. Whether the power has been actually exercised, or prices or the total volume of trade increased or diminished is immaterial; and its existence must be determined by practical consideration of existing conditions, giving due weight to the peculiarities of the commerce involved. It is certain that where parties have deliberately pursued a course, the ordinary result or necessary tendency of which is monopoly, they cannot be heard to deny an unlawful intent; and a monopoly acquired through contract, combination or conspiracy which directly and essentially destroys competition clearly is unlawful. United States v. Trans-Mo. Ft. Assn., 166 U. S. 290; Addyston Pipe Co. v. United States, 175 U. S. 211; Swift & Co. v. United States, 196 U. S. 375.

The courts have long referred to " monopoly " the outcome of individual action as distinguished from governmental grant, and have declared unlawful every arrangement tending thereto. The word in the Sherman Act has the same significance as in the well-known opinions, from Mitchell v. Reynolds, 1 P. Williams, 181, to Continental Wall Paper Co. v. Voight, 212 U. S. 227; United States v. Addyston Pipe Co., 85 Fed. Rep. 271; United States v. E. C. Knight Co., 156 U. S. 1, 16; Pearsall v. Great Northern Railway Co., 161 U. S. 644; United States v. Freight Association, 166 U. S. 290, 323; National Cotton Oil Co. v. Texas, 197 U. S. 115; Shawnee Compress Co. v. Anderson, [119] 209 U. S. 423, 433; People v. North River Sugar Refining Co., 54 Hun, 354; American Biscuit Co. v. Klotz, 44 Fed. Rep. 721, 724; Richardson v. Buhl, 77 Michigan, 632; Pocahontas Coke Co. v. Powhatan C. & C. Co., 60 W. Va. 508; Harding v. American Glucose Co., 182 Illinois, 619, 620; Noyes on Intercorporate

Argument for the United States.

Rels., §§ 329 et seq., 389; Andrews, Amer. Law (2d Ed.) Vol. I, 773.

The legislation against combinations and monopolies cannot be defeated by causing a corporation to acquire the shares or property and business of competing corporations; nor by any other scheme or device.

Corporate combinations which bring about the results denounced by the statute are unlawful. They are in fact more injurious to the public than the old forms of simple agreement among separate concerns or the well-known trust forms. Eddy on Combinations, Vol. I, §§ 617, 620 et seq.; Noyes on Intercorporate Relations, § 307; Distillery Co. v. People, 156 Illinois, 448.

If the corporate form of combination is beyond the reach of Congress, it lacks supreme power to regulate commerce. Certainly a corporation, a mere creature of state law, cannot be endowed with power to obstruct commerce not possessed by the State itself. Deb's case, 158 U. S. 564; Addyston Pipe Co. v. United States, 175 U. S. 211; Northern Securities case, 193 U. S. 197.

The right to buy, sell and transfer property is not superior to the right to make other contracts; and all are subordinate to the power of Congress to regulate commerce. Addyston Pipe Co. v. United States, 175 U. S. 211; Northern Securities Co. v. United States, 193 U. S. 197; Swift & Co. v. United States, 196 U. S. 396; Shawnee Compress Co. v. Anderson, 209 U. S. 423; Armour Packing Co. v. United States, 209 U. S. 56; United States v. Del. & Hud. R. R. (Commodities Clause case), 212 U. S. 366; Natl. Harrow Co. v. Hench, 83 Fed. Rep. 36; S. C., 84 Fed. Rep. 226.

A corporation which, not as an incident to orderly [120] growth, secures control of competitors by purchasing their shares or property and business and thereby acquires power to suppress competition is no less inimical to public interests than a technical " Trust," and indeed is often a mere modification thereof. The direct, necessary result of such an. arrangement is to hinder and obstruct commerce. The Pearsall case, 161 U. S. 644; Northern Securities case, 193 U. S. 344; Shawnee Compress case, 209 U. S. 423; Distillery Co. v.

Argument for the United States.

People, 156 Illinois, 448, 491. In re Greene, 52 Fed. Rep. 104, and the E. C. Knight case, if to the contrary, must be considered disapproved.

There is no foundation for the claim that the Sherman Act was directed only against contracts and combinations of an executory nature, and is without application where transfers of property have been actually executed. It was intended to, and does, prohibit obstructions to commerce whether resulting from executory or executed arrangements. Northern Securities case, 193 U. S. 197; Shawnee Compress Co. v. Anderson, 209 U. S. 423; People v. Chicago Gas Trust, 130 Illinois, 268; Distillers & Cattle Feeding Co. v. The People, 156 Illinois, 448; Pocahontas Coke Co. v. Powhatan Coal & Coke Co., 60 W. Va. 508; Eddy on Combinations, § 622; Noyes on Intercorporate Relations, §§ 354, 386.

A foreign corporation doing business within the United States has no right to violate its policy or laws. An agreement or combination which in purpose or effect conflicts therewith, although actually made in a foreign country where not unlawful, gives no immunity to parties acting here in pursuance of it.

If Congress is powerless to prevent wrongs in its own jurisdiction, when the actors are foreigners, or when done in pursuance of agreements made abroad, its sovereignty is a myth.

A crime is committed within the jurisdiction where the act of the parties actually takes effect, although the in[121]strumentalities may have been set in motion in another jurisdiction. Re Palliser, 136 U. S. 256, 265; Horner v. United States, 143 U. S. 207; Benson v. Henkel, 198 U. S. 1; Burton v. United States, 202 U. S. 344, 387; United States v. Thayer, 209 U. S. 39, 44.

The courts should enforce the anti-trust legislation by all appropriate processes known to their usages; and decrees should be so moulded as to suppress effectually the mischief consequent upon unlawful arrangements.

Congress has forbidden monopolies and combinations. When one exists everything done in furtherance of its purpose is unlawful; especially every act constituting a part of

Argument for the United States.

interstate or foreign commerce. Therefore the privilege of engaging therein may be denied. The power to regulate extends to prohibition of anything directly conflicting with the will of Congress lawfully expressed. Northern Securities Co. v. United States, 193 U. S. 197; Champion v. Ames (Lottery case), 188 U. S. 321; United States v. D. & H. Co., 213 U. S. 366; Loewe v. Lawlor, 208 U. S. 274.

The statute requires the court "to prevent and restrain violations "—not merely to determine the legality of past transactions. The public interest is the thing to be subserved, and it demands the destruction of existing michief and prevention of impending wrongs-the removal of obstruction existing or threatened.

Where an unlawful corporate combination exists and identity of constituents has been destroyed, or where one corporation has acquired a forbidden monopoly, there are two possible effective remedies. The first is to enjoin the corporation from doing interstate or foreign business until (if ever) it can affirmatively show that its affairs have been readjusted so as to render future operations lawful. The second is to appoint a receiver to take possession of the concern and by proper action restore opportunities for free competition. Deb's case, 158 U. S. 564; Chicago, [122] Rock Island &c. Ry. v. Union Pacific Ry., 47 Fed. Rep. 15, 26; Stockton, Atty.-Genl., v. Central R. R. Co., 50 N. J. Eq. 52, 489; Taylor v. Simon, 4 Mylne & Craig, 141; Pomeroy on Eq. Juris., 2d Ed., §§ 111, 170.

The Government established violations of the Sherman Act by proving first, the existence of contracts, combinations, conspiracies and monopolies; and, second, that the direct result or necessary tendency of these is materially to obstruct, hinder and burden the free flow of interstate and foreign commerce.

The Knight case is not controlling; the combinations established here directly and materially affect not only the production and manufacture, but every department of trade and commerce in tobacco; and the results have been destruction of competition in such commerce and monopolies by defendants.