Standard+Oil+Co.+of+New+Jersey+v.+U.S.

__** Standard Oil Co. of New Jersey v. U.S. **__

**Date of Hearing**: March 14-16, 1910; Re argued January 12-17, 1911; Decided May 15,1911

**Chief Justice**: Edward Douglass White Jr.(1844-1921) Edward Douglass White Jr. was born in southern Louisiana where his father, Edward Douglass White Sr., was the governor. He began studying at Georgetown College.When the Civil War began, White dropped out to enlist in the Confederate Army, but was captured by Union soldiers. After he was released at the end of the war, he continued his college education at the University of Louisiana, where he studied law. After he graduated, he was elected Chief Justice by President Taft. Edward D. White Jr. was the ninth Chief Justice of the United States. He, along with the Supreme __court__, was responsible for creating the Rule of Reason of standard antitrust law. This law was the court's interpretation of the Sherman Antitrust Act and it stated that only contracts that unreasonably restrain trade violate the Anti-Trust Laws, and that running a monopoly was not illegal.He served on the Supreme Court for 26 years before his death at age 75.

The main issue in the Standard Oil of New Jersey v.U.S.was on ethics. Was it ethical to prosecute Standard Oil Co. if technically speaking nothing directly pertaining to the Sherman Anti-Trust Law had been violated? Standard Oil was using practices which while not necessarily were unfair in all cases, were limiting any other companies from competing with them. The Sherman Antitrust Law does not say that owning a monopoly is illegal, only that certain business practices that successfully create monopolies are. Standard Oil was participating in horizontal immigration to such an extent that nearly all competitors in the USA had been bought out or forced out of business. It was legal to buy other companies so some people questioned why persecute a company for its success and hard work. It wasn't much of a reward. Yet on the other hand Standard Oil was getting so big in our country that it could easily force a little start up company out of business. This was not good, but was it the Supreme Court's place to interfere? Should they take so much power into their own hands? Standard Oil was using it's size and power to undercut competitors that was considered "anti-competitive". With under pricing and threatened suppliers that used other oil corporations, Standard Oil was prosecuted for violating the Sherman Antitrust Act. The act doesn't allow business tactics that reduce competitiveness, like tactics Standard Oil was using, and the issue was over what Congress can do to control these major monopolies. **Good argument, the law was created AFTER Standard got so big.**
 * Main Issue ** :

**Documents or amendments to the Constitution relevant to the case**: The Sherman Antitrust Act was created to stop __arrengments__ which design or tend to increase the consumers cost's. However, it only limits these arrangments in preventing contracts that restrian trade or __comerce__ several states or __contries__ and one or more people that __attemt__ or conspire to monopolize trade or commerce in several states or contries. The Rule of Reason is a doctrine which was developed by Edward Douglass White Jr. and the __supreme court__ to help deal with the Standard Oil Co. of New Jersey v. U.S.. It states that only combinations and contracts that unreasonable restrict trade showld be prosecuted by anti-trust laws. This means that being a monopoly power is not nessisarly illegal, but it also brings in the playing field that any practices that the Supream Court considers to be limiting, but are not specifically mentioned in the Sherman Anti-Trust Act, can be legally stopped by the government. This heavily applies to the Standard Oil Company of New Jersey v. U.S. because tecnically what Standard Oil was doing was not illegal, however it was very much limiting the chances of __it's__ competitors, reducing competition.



** Summary of case ** : The Company was accused of violating The Sherman Antitrust Act,passed in 1890, which prohibited the actions from businesses that reduce competition. This was the first act that limited monopolies. The Standard Oil Company was violating this act by reducing competition by undercutting competitors. With their power, the company was able to persuade consumers to use their product. Also, Standard Oil had power over railroad companies to ship their oil before their competitors, causing the competitors to fall behind. This all was against the Sherman Antitrust Act but Congress was unsure of what power Congress had over it. So the whole court case was if Congress could do anything to stop one company from acquiring others and caused a restraint on competition.

**Decision rendered by the court plus the vote**: The Court agreed that it was within the power of __congress__ to stop horizontal integration; and that a contract violates the Sherman Antitrust Act if the contract restrains trade. They ruled in favor of the United States and agreed that Standard Oil Company should be broken apart. The court found several disadvantages to monopolies including higher prices, reduced output, and reduced quality. So the Standard Oil Company was broken up.

John M. Harlan (33 years on the court: November 29, 1877 – October 14, 1911) · Joseph McKenna (27 years: January 21, 1898 – January 5, 1925) Oliver W. Holmes, Jr. (served 20 years: December 4, 1902 – January 12, 1932) · William R. Day (19 years: February 23, 1903 – November 13, 1922) Horace H. Lurton (4 years: December 20, 1909 – July 12, 1914) · Charles E. Hughes (11 years: February 13, 1930 – June 30, 1941) Willis Van Devanter (26 years: December 16, 1910 – June 2, 1937) · Joseph R. Lamar (5 years: December 17, 1910 – January 2, 1916) The majority consisted of White, joined by McKenna, Holmes, Day, Lurton, Hughes, Van Devanter, and Lamar. Harlan was dissenting because he was against the Rule of reason. He believed that the Sherman act only upheld the restraint of trade "direc tly" and adding anything to the law would be a departure from the Sherman Anti-Trust Law. The Court did conclude that Congress did have power to control the monopoly with the Commerce Clause **(so then this should also be included in the laws, etc. affected by the SC's case)**, states that Congress has power to regulate commerce.
 * Who voted what, dissenting, and why?: **

***Cartoon representing the Standard Oil monopoly as a monster taking over, especially with horizontal integration, and taking over everything.**

What is your personal opinion of the case**:** I believe that congress should have the right to stop horizontal integration if it poses a threat to the prosperity of other companies. Also, with one large monopoly. it is so easy for that major company to wipe out any other smaller companies that may pose as a threat. When there is one major company, then there isn't any real competition and that company is allowed to control the pricing of the goods with out worrying about any other competition. It is easier for the consumer if there are several smaller companies because then prices are controlled due to competition between the companies.

What if this case had gone the other way?: I feel that if the case had gone the other way, then giant monopolies would still exist today. Standard Oil would not have been broken down into 34 smaller companies, such as Chevron, Exxon, and Mobil. The monopoly would have continued to grow and grow and would eventually be the only oil company and people would be forced to buy their product because they're the only ones making it. Prices would be controlled solely by one giant business because competition would not exist. We might be living in a world with one cellphone coverage monopoly or one internet search monopoly. This case was the beginning of "trustbusting" and the end of an era of giant monopolies.

Bibliography ** "The Supreme Court Historical Society - Timeline of the Court - Chief Justice Edward Douglas White." //The Supreme Court Historical Society - Home //. Web. 13 Feb. 2012. .

<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">"Edward Douglass White." //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">Wikipedia, the Free Encyclopedia //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">. Web. 13 Feb. 2012. <http://en.wikipedia.org/wiki/Edward_Douglass_White>.

<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">"Standard Oil Co. of New Jersey v. United States." //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">Wikipedia, the Free Encyclopedia //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">. Web. 13 Feb. 2012.

<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">"Sherman Antitrust Act." //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">Wikipedia, the Free Encyclopedia //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">. Web. 14 Feb. 2012. <http://en.wikipedia.org/wiki/Sherman_Antitrust_Act>.

<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">"Rule of Reason." //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">Wikipedia, the Free Encyclopedia //<span style="background-color: #ffffff; font-family: 'Times New Roman',Times,serif; font-size: 16px;">. Web. 15 Feb. 2012. <http://en.wikipedia.org/wiki/Rule_of_reason>.

By:Sarah Costello, Emily Laswell, and Marissa Williams

6/7 - Biblio - good, but alphabetical 26/28 - Content - nicely explained and decent analysis 4.5/5 Organization - watch spelling errors

36.5/40 Total