American Banana Co. v. United Fruit Co.
| Decision Date | 15 December 1908 |
| Docket Number | 65. |
| Citation | 166 F. 261 |
| Parties | AMERICAN BANANA CO. v. UNITED FRUIT CO. |
| Court | U.S. Court of Appeals — Second Circuit |
Wheeler Cortis & Haight (Everett P. Wheeler, Clarence B. Smith, and John W. Griffen, of counsel), for plaintiff in error.
Strong & Cadwalader (Moorfield Storey and Henry W. Taft, of counsel), for defendant in error.
Before LACOMBE, COXE, and NOYES, Circuit Judges.
This is an action for the recovery of treble damages under the seventh section of the federal anti-trust statute (Act July 2, 1890, c. 647, 26 Stat. 210 (U.S. Comp. St. 1901, p 3202)).
The complaint alleges, in substance, that the defendant corporation was organized in 1899, and thereafter at all times engaged in the business of importing bananas into the United States from Central and South America; that in 1899 and subsequent years, for the purpose of monopolizing the banana trade between such countries, of regulating prices, controlling production, and preventing competition, the defendant acquired the property and business of several competing corporations and individuals, entered into contracts regulating prices and restricting business with other competitors, acquired controlling stock interests in still others, and organized a common selling agent for all; that in April, 1903, one McConnell began to make a banana plantation upon the northerly bank of the Sixola river in Panama, then a part of the United States of Colombia, and to build a railway connecting said plantation with the nearest port and affording the only practicable means of access to the plantation; that said McConnell obtained the transfer of a concession to build such railroad from an official of the United States of Colombia, who subsequently recommended to his government that Costa Rica be allowed to administer the territory through which it was to run notwithstanding such territory had previously been awarded to Colombia by an award of the President of France acting in accordance with a treaty between Colombia and Costa Rica; that in November, 1903, that part of the United States of Colombia known as the 'Department of Panama,' and including the territory in question, revolted and became the republic of Panama; that in June, 1904, the plaintiff corporation, which had been organized for the purpose of growing and buying bananas in Central America and importing them into the United States, purchased said plantation and concession from McConnell, and spent large sums of money in the development of the plantation and construction of the railroad; that in July, 1904, Costa Rican soldiers and officials, instigated and induced by the defendant, seized a portion of the plaintiff's plantation and a cargo of supplies recently landed thereon; that said soldiers and officials have continued to forcibly occupy and hold said portion of said plantation, have stopped the construction and operation of said railroad, and have wholly prevented the plaintiff from carrying on its business; that the plaintiff has endeavored to induce the government of Costa Rica to withdraw its soldiers and officials, but such government has refused to do so; that the defendant has purchased an alleged title to the plaintiff's plantation, and has instituted certain proceedings thereunder, and that the defendant and its associates have combined to prevent the sale of bananas to other exporters than themselves, and have made such arrangements with growers that there is no market in which bananas can be purchased by the plaintiff for export.
The defendant answered, and the case came on for trial, when the defendant moved to dismiss the complaint upon the ground that it failed to state a cause of action. This motion was granted by the trial court, and the plaintiff brings this writ of error.
The seventh section of the federal and anti-trust statute, upon which this action is brought, provides that any person 'injured in his business or property' by reason of anything forbidden or declared to be unlawful by the act may recover threefold damages. It is then of first importance to ascertain what actions of the defendant have injured the plaintiff. If the complaint contains allegations of actions which have not had that effect, it is unnecessary to consider them, however much they may contravene the other provisions of the statute. Thus the averments concerning the various combinations for the elimination of competition, standing by themselves, are immaterial.
If the defendant had not done the things which injured the plaintiff, no cause of action would be stated, even if it were apparent that the preexisting combinations had been of the most unlawful nature. So the allegations concerning the purchase of the alleged title and the communication of the Colombian official to his government are immaterial, because it does not appear that they injured the plaintiff.
The only damages claimed in the complaint are-- stated inversely to the order of their importance: (1) For the injury resulting from the securing of control by the defendant and its associates of the banana market. (2) For the injury to the plantation, business, and railroad inflicted by the Costa Rican officials.
Now, in order to state a cause of action for damages under the statute, it is not necessary to aver an injury to an existing business. As said by this court in Thomsen v. Union Castle Mail Steamship Co. (decided October, 1908) 166 F 251, 'it is as unlawful to prevent a person from engaging in business as it is to drive a person out of business. ' See, also, Pennsylvania Sugar Refining Co. v. American Sugar Refining Co. (decided this day) 166 F. 254. But it is necessary to state facts showing an intention and preparedness to engage in business. Thus in the Pennsylvania Sugar Refining Case it was alleged that the plaintiff had erected and equipped a sugar refinery, and was prepared and intended to engage in the manufacture and sale of sugar, when it was prevented from so doing by the acts of the defendants. In the present case, however, it is not alleged that the plaintiff had made any preparations to engage in the business of buying bananas independently of the operation of its own plantation, nor that it desired or intended to engage therein as a separate and independent business. It is not averred that the plaintiff invested any money in preparing to engage in any such independent business; nor does the extent to which, nor even the country in...
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