Sherman Anti-Trust and Standard Oil
Arguably one of the most important and powerful trusts was the Standard Oil of New Jersey. “Standard was a network of 70 companies and 23 refineries at the turn of the century controlling 84% of the refined oil in the United States.”11 Oil has been and always will be an important resource in the world, and a trust that controls such a staggering amount has tremendous influence in the world. Many were upset as Standard Oil kept growing saying, “Here is a corporation held to be a trust and combination in violation of statutes substantially like the Federal anti-trust act, and yet the state is compelled to permit violation of its laws because of the power of such a company.”12 Soon the United States brought legal action against Standard Oil of New Jersey.
On May 15, 1911, the Supreme Court reached a decision. Their decision dealt with understanding what is deemed unreasonable when dealing with commerce. The Majority Opinion from Chief Justice Edward White diligently goes into what the Standard Oil of New Jersey wrongfully does. “Justice White determined that the attempt to control the free market through fixed pricing, combinations/monopolies, and seeking to eliminate competition would be classified as unreasonable and thus illegal.”13 White strongly believes if there is an attempt in any of the practices above it is unreasonable. His stance is so strong he is even able to alter the Sherman Anti-Trust Act to say only unreasonable contracts break the Act and become illegal. As a result of the illegal trust Standard Oil of New Jersey had to disband its trust and the Sherman Anti-Trust Act became more foggy with new interpretations.
Footnotes
11 Morton, Peter. “In the End, Breaking up May Be Hard to Do: First Test of Sherman Act Was Standard Oil: [National Edition].” National Post. June 8, 2000.
12 “STANDARD OIL CO. A MONOPOLY WITHIN MEANING OF SHERMAN ACT.: SAYS ATTORNEY-GENERAL WICKERSHAM, IN HIS BRIEF FILED WITH SUPREME COURT IN ANTI-TRUST CASE. Abuse of Personal Privileges Made Sherman Act a Necessity--This Company Was Kind of MonopolyAimed At--Meaning of Section 1 of Act Discussed--It Provided That Every Contract in Restraint of Trade Was Illegal--Defendant's Statements Disputed. STANDARD OIL CO. A MONOPOLY WITHIN MEANING OF SHERMAN ACT.” Wall Street Journal (1889-1922). January 7, 1911.
13 Jimison, Robert, Kristeria Floyd, Casey Hall, Brianna Robinson, and Ashley Thorne. “Standard Oil Co. of New Jersey v. United States (1911).” US Conlawpedia, 2015. https://sites.gsu.edu/us-constipedia/standard-oil-co-of-new-jersey-v-united-states-1911/#:~:text=The%20court%20ruled%20in%20favor,one%20another%2C%20effectively%20lowering%20prices.