United States v. E. C. Knight Co.

156 U.S. 1, 15 S. Ct. 249 (1895)

 

RULE:

In order to vitiate a contract or combination it is not essential that its result should be a complete monopoly; it is sufficient if it really tends to that end and to deprive the public of the advantages which flow from free competition.

FACTS:

The United States and others, filed a bill charging that four sugar refinery companies with violation of 26 Stat. 209 (1890), which protected trade and commerce against unlawful restraints and monopolies. They allege that the sugar companies did not make contracts which restrained trade and commerce in the sale of refined sugar. The bill charged that contracts under which purchases of stock were made constituted combinations in restraint of trade. The bill sought cancellation of the agreements under which the stock was transferred and redelivery of stock. The circuit court dismissed the bill. This was appealed to the Supreme Court of the United States.

ISSUE:

Shoud the bill be dismissed?

ANSWER:

Yes

CONCLUSION:

The Court held that there was nothing which indicated any intention by the sugar companies to put a restraint upon trade or commerce. The fact that commerce was indirectly affected was not enough to entitle plaintiffs to the bill. The act only authorized the courts to restrain violations in respect to contracts, combinations, or conspiracies in restraint of interstate or international trade or commerce. 

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