Moloney v. American Tobacco Co.

• Decision Date: 25 March 1896
• Citation: 72 F. 801
• Parties: MOLONEY, Attorney General, v. AMERICAN TOBACCO CO. et al.
• Court: U.S. District Court — Northern District of Illinois

72 F. 801

MOLONEY, Attorney General, v. AMERICAN TOBACCO CO. et al.

United States Circuit Court, N.D. Illinois.

March 25, 1896

Atty Gen. Moloney, in pro. per.

Charles H. Aldrich, for defendants.

SHOWALTER Circuit Judge.

This proceeding is, in form, an information in equity by the attorney general of Illinois. It was commenced in the circuit court of Cook county, and thence removed to this court on petition of defendants, wherein they insist that a federal question is involved. The proceeding is grounded on section 4 of the act of 1893 of the Illinois legislature entitled:

'An act to define trusts and conspiracies against trade declaring contracts in violation of the provisions of this act void, and making certain acts in violation thereof misdemeanors, and prescribing the punishment therefor and matters connected therewith.'

Said section 4 is in words following:

'Every foreign corporation violating any of the provisions of this act is hereby denied the right and prohibited from doing any business within this state, and it shall be the duty of the attorney general to enforce this provision by injunction or other proper proceedings, in any county in which such foreign corporation does business, in the name of the state on his relation.'

Section 1 defines what a trust is. Section 2 provides that any domestic corporation violating any of the provisions of the act shall forfeit its charter and cease to exist. And section 3 directs the attorney general to institute suit or quo warranto proceedings against any domestic corporation so violating the act. Section 5 declares any violation of any of the provisions of section 1 to be a conspiracy and a misdemeanor, and fixes a fine of not more than $5,000 nor less than $2,000 against 'any person who may be or may become engaged in any such conspiracy or take part therein or aid or advise in its commission, or who shall, as principal, manager, director, agent, servant, or employe, or in any other capacity knowingly carry out any of the stipulations, purposes, prices, rates, orders thereunder or in pursuance thereof. ' And section 6 concerns the form of the 'indictment or information for any offense named in this act. ' But no consequence, as against a domestic corporation, seems to follow the offense, other than the forfeiture of its charter, or, as against a foreign corporation, other than an inhibition from business in this state.

The American Tobacco Company, the principal defendant, is a corporation organized under the laws of New Jersey. It is said, in the information, that this corporation was created by a combination of separate and previously competing concerns for the purpose of a monopoly in products made from tobacco, and, particularly, in cigarettes; that said combination practically controls the trade in the last-named commodity in the United States and in Illinois; that it carries on its trading operations in Illinois by the aid of divers persons and corporations domiciled here, each being under a contract of agency for the sale and handling of said product, and each having engaged with the company not to handle the goods of any other manufacturer. These agents are made co-defendants with...