United States v. E.C. Knight Company

In the early 1890s, the American Sugar Refining Company purchased stock in four other refineries, formerly competitors, including the E.C. Knight Company. By 1892, American Sugar Refining controlled 98 percent of the nation’s refineries.

Suit was brought by the Cleveland administration, alleging that an illegal restraint of trade in interstate commerce had occurred under the terms of the Sherman Antitrust Act.

In 1895, a nearly united Supreme Court ruled eight to one against the government, reasoning that manufacturing (sugar refining) was not interstate commerce and, therefore, not subject to Congressional regulation.

The impact of this decision was tremendous. Manufacturers assumed they were immune from antitrust legislation and a wave of consolidation followed. Little progress would be made to combat manufacturing monopolies until the trust-busting days of the Teddy Roosevelt administration.



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