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shall acquire by gift and shall own as treas- [ ury stock not less than six hundred shares of said preferred stock, aggregating in face value sixty thousand dollars ($60,000), and also not less than fifty thousand dollars face value of its common stock;

"And, whereas, it is desired by this contract to give an opportunity to holders of stock in the Huse-Loomis Ice & Transportation Company to consent to and further the proposed amalgamation of all of said properties, and to exchange their present holdings of stock in the Huse-Loomis Ice & Transportation Company for preferred stock in the new corporation, and on the basis and upon the conditions hereinafter stated:

"Now, therefore, in consideration of the premises and of the sum of one dollar paid to each of the parties of the first part, and of the mutual agreement and trust hereinafter stated, it is hereby mutually agreed between the respective parties hereto as follows:

"First. Each of the parties of the first part in signing this contract, binds himself only, and merely as to the stock for which he signs, and does not assume or incur any liability for the undertakings of any other parties of the first part.

"Second. Each of the parties of the first part agrees on demand of the trustee (after holders of all stock in the Huse-Loomis Ice & Transportation Company have signed this contract) to deposit with the party of the third part, as trustee, certificates, indorsed in blank for transfer upon the books of the company, evidencing the respective number of shares of stock in the Huse-Loomis Ice & Transportation Company, for which they have signed this contract, for which deposits the said trustee will give its receipts; said certificates to remain in the possession of the trustee during the term of the option granted by this contract, unless they have sooner been disposed of according to further provisions hereof.

"Third. Each of the parties of the first part hereby grants to the party of the second part an exclusive option during sixty days from the date of this contract, to purchase the stock hereby signed for at a price to be paid in full-paid preferred stock in the new company, if organized as above recited, said price to be determined by estimating the exchange value of the stock in the Huse-Loomis Ice & Transportation Company at eighty dollars ($80) per share, and of the preferred stock in the said new company, at par, $100, per share; i. e., each share of stock in the Huse-Loomis Ice & Transportation Company shall be considered as worth $80 on account of the purchase of one share of preferred stock in the new company.

of the first parties, of the respective numbers of full-paid shares of the kind of stock in the new company to which each is entitled under this contract, the trustee shall, and will, deliver to the second party, or his order, the certificates of stock in the Huse-Loomis Ice & Transportation Company theretofore deposited with it by the respective parties of the first part, and will thereupon deliver to the respective first parties the said certificates of stock in the new company deposited with it for each, as above provided. Upon making of such delivery the duties of the trustees shall be at an end.

"Sixth. The signature of each of the first parties to this contract is upon condition that this contract is not to become or to be binding upon any signer unless the holders of all of the stock in the Huse-Loomis Ice & Transportation Company sign the same.

"Seventh. It is understood and agreed that all holders of stock in the Huse-Loomis Ice & Transportation Company are to receive preferred stock in the new company in exchange for their present holdings, except Charles W. Whitelaw, who has consented to accept common stock of the new company on the same basis of value, i. e., each share of his present stock to pay $80 on account of one share of common stock of a par value of $100 in the new company, and that he is also, through the amalgamation of all of said assets and their acquisition by the new company, to receive additional shares of common stock in the new company, in compensation for his services in accomplishing the consolidation above referred to.

"Eighth. If the sale and exchange of stock provided for in this contract is not consummated within the said sixty days, then at the expiration of that time the third party shall, and will, return to each of the first parties the respective shares of stock in the Huse-Loomis Ice & Transportation Company, theretofore deposited with it under this contract.

"Ninth. The obligations, powers, and rights resulting from this contract shall be binding upon and shall operate in favor of the respective legal representatives, assigns, and successors in trust of the parties hereto.

"In witness whereof, the parties have signed this contract the day and year first above written."

The only difference in the contracts were the dates, the parties, and the value of the shares. We shall not set out at length the other instruments of writing gone through with in the evolution of the respondent. Suffice it to say that the parties interested on "Fourth. Each of the parties of the first part February 11, 1903, gave their note for $1.800,hereby constitutes and appoints the party of 000 to the Union Trust Company and received the second part as proxy, giving him power, credit on the books of the Trust Company for during the period of the option granted in the that amount. On the 13th day of February last section of this contract, to vote the shares these same parties gave their check on the of stock hereby signed for, at any meeting of the stockholders of the Huse-Loomis Ice & Trust Company to the newborn, the Polar Transportation Company, for the purpose of au- Wave Ice & Fuel Company, for $1,800,000, thorizing the directors and officers of the Huse and that company got a book credit for that Loomis Ice & Transportation Company to sell, transfer, convey, and deliver all of its assets, sum, and the other parties were debited with together with its good will, to the proposed new a like sum, thus leaving their account square. company, as well as for other purposes; the Then the new corporation gave the same proxy hereby granted, however, is upon condi-makers of this note its check for $1,800,000, tion that the second party shall not exceed the same until he has obtained a contract with the and received from them deeds from the seven new company and the holders of all its stock, by old corporations of all their holdings, except the terms of which there shall be deposited with their charter. Thus the new corporation the third party, in trust for each of the first was left with no funds after its account had parties, such stock in the new company as each of the first parties is to receive under this conbeen debited with its $1,800,000 check. The tract, said deposit of new stock to be made up- makers of the note were not going to be outon the transfer of the assets of all of said exist- done in promptness of liquidating paper ing companies. debts, and they on the same day gave their check on the Union Trust Company to the

Fifth. It is mutually agreed that upon the deposit with the third party, in trust for each

[1, 2] II. That the information in this case is broad enough to bring it within the terms of our anti-trust statute is clear from the following language used therein:

Union Trust Company for $1,800,000, and took | the real question in issue. This information up their note. Nobody saw any money and will be measured by the statute, and, when the records fail to disclose any interest paid. so measured, we think the language used is The stock in the new corporation was then broad enough to cover the third proposition distributed by the several trustees named in stated supra. This matter we discuss in the the contracts to the stockholders of the old next paragraph. corporation in accordance with the rate and ratio fixed in the several contracts. The unit of transfer was the new stock at face value. In two of the old companies $100 in stock only paid $75 in new stock, whilst in others the old stock was taken in as high as $7 to $1. In other words, $1 of old stock would pay for $7 of new. In this fashion the respondent was born and started out upon its successful business career. We say successful, because in the course of a few years it had not only paid 6 per cent. dividends upon its stock, but had charged off of its books, and replaced in cash, nearly a half million dollars, which was the "good will" of the old companies capitalized in the new corporation. Not only so, but it invested large sums in new equip ment and property, the details of which may be referred to in the course of the opinion. There is some evidence that after the organization of the respondent it threatened to, and did, kill off one competitor by reducing prices, and thus getting the consumers. This sufficiently outlines the case. Details will come in the course of the opinion.

"Plaintiff further states that said consolidation of said 'seven companies' in the manner laws of the state of Missouri, and was and is an hereinbefore set out was and is contrary to the arrangement and combination which tends to lessen full and free competition in the purchase and sale of ice in the city of St. Louis, and since the 13th day of February, 1903, has continued to be an arrangement and combination which has wholly destroyed competition between the said 'seven companies' in the purchase and sale of ice in the city of St. Louis; that said unlawful arrangement has continued from the 13th day of February, 1903, to the time of the bringing of this suit and was in full force and effect from the 1st day of August, 1904, until the time of the bringing of this action, to wit, for a period of seven hundred and twenty-one days; that by reason of the illegal acts, conduct, and arrangement on the part of respondent company hereinbefore set out, great injury, harm, and damage has come to the people of the city of St. Louis, and the people of the state of Missouri, and defendant has forfeited its right and franchise to carry on business under the laws of the state of Missouri."

The italics are ours. The statute involved it was my pleasure to analyze and discuss in State ex. inf. v. International Harvester Co., 237 Mo. loc. cit. 405, 141 S. W. 680. In that case, after setting out the statute in full, I

said:

"The part to which I desire first to apply the facts in this case, stripped of all useless verbiage, would read: All arrangements, contracts, agreements, combinations or understandings made, or entered into between any two or more persons, designed or made with a view ** * full to lessen, or which tend to lessen this state of any product, commodity, or article, ⚫ in and free competition in the sale or things bought and sold, are hereby

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I. Appellant's first contention is thus stated: "Quo warranto to oust from a corporate charter, for reasons relating to the organization and to the right to use the charter thus obtained, must proceed against the individuals who usurp the charter. If the corporation is sued and is alleged to be duly incorporated [as in the case at bar], the propriety and legality of all matters incident to its organization are admitted." For the purposes of this case we might grant all that is here claimed. Counsel, starting from this corner stone, then proceed, to their own satisfaction, at least, to show that the whole case for the state falls with this concession. Grant it that the state by charging the due incorporation of the appel-declared to be against public policy, unlawful lant would be estopped from challenging and void; and any person or persons creating, fraud in its incorporation, yet that would entering into, becoming a member of, or participating in such arrangements, contracts, not end the case, because there are other agreements, combinations, or understandings vital matters in the information before us. shall be deemed and adjudged guilty of a conThis information (and we have set it out in spiracy in restraint of trade, and punished as provided for in this article.' full, so that it may speak for itself) when fairly analyzed, charges at least three things: (1) a fraudulent incorporation of appellant; (2) a consolidation of seven existing corporations in violation of our statutes with reference to consolidating corporations; and (3) an unlawful arrangement, agreement, or understanding to lessen competition in the manufacture and sale of ice. Appellant disclaims that there was any attempt to consolidate corporations under the statute, and we think there was none. Nor need we go into the alleged fraud in the organization of the corporation. We shall take the case upon the third ground of the petition, and discuss it from that point solely, and only mention its method of incorporation as it bears upon

"The punishment is fixed by section 10,304, which follows in the article. It will be noticed that our statute is exceedingly broad. It inderstandings, but also all arrangements and cludes not only contracts, agreements, and uncombinations. It includes not only all those things which tend to lessen full and free competition, but likewise all those things which free competition. In other words, this statute, were done with the view of lessening full and punctuated and worded as it is, covers two classes of 'arrangements, contracts, agreements, Those that were made with the view to lessen combinations and understandings'; i. e.: (1)

full and free competition,' but which may have never been so operated as to reach the result had in view or in mind; and (2) full those made 'which tend to lessen and free competition' and which in fact did not lessen competition.

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"I repeat that this statute when fairly ana

lyzed thus resolves itself, so far as the question, St. Louis. One has to but glance at the plan under discussion is concerned. The several as shown by their contracts, and the stock clauses purposely placed therein by the lawmaking power do not mean one and the same ownership both in the new and the old orthing, but were put there purposely to be far ganization to be convinced of what the arreaching in effect. It was intended to reach all rangement, in fact, was, and its intended purconceivable methods which might be designed by shrewd 'captains of finance.'. The purpose pose. Our statute is not leveled at bona of the statute was to thwart action in the very incipiency as well as all down the line. It was designed to reach all arrangements, etc., which were designed and made with the view of lessening competition, as well as those which, in fact, did that thing. Either class falls equal ly under the ban of the statute-one no more nor less than the other."

fide sales of property by one corporation to another, when made in the ordinary and usual methods of trade, but it is leveled at just such arrangements as is disclosed by this record. This appellant was born through an idea early possessed and capitalized by Chris Muckermann; i. e., the idea of stifling competition in the sale of ice by incorporat

The information in the case at bar, in addition to other reasons assigned for the taking under one head all opposition. The idea ing of appellant's charter, does assign as a descended with increased vigor from the reason that the very organization of appel- father to the son, I. C. Muckermann, and he lant was such as to make it an unlawful "ar- and Whitelaw, of the three whole companies, rangement" "to lessen full and free competi- were the godfathers of appellant, an illegitition" in the sale of ice. Note the language mate child, when the state laws are considerof the information "and was and is [the or- ed. From the very beginning the Muckerganization of appellant as a corporation] an manns were possessed with the idea of dividarrangement and combination which tends ing territory to the end that their several to lessen full and free competition in the pur- corporate entities should not compete one chase and sale of ice, etc." This feature of with the other. It is suggested that retailing the information counsel for appellant over- ice must be in limited districts to be profitlook and ignore. To my mind it stands out able, and to a certain extent that is true, but over and above all other matters charged not to the extent and in the manner revealed therein, and we therefore leave other ques- by this record. The directing powers of the tions for the discussion of this one para- four Muckermann companies were active in mount question; i. e., Was the organiza- confining their companies in such way as to tion and incorporation of the appellant an prevent competition. That idea was one of unlawful "arrangement" made with the view long standing in the Muckermann companies, of lessening competition in the purchase and yet it is true that the evidence does disclose sale of ice in the city of St. Louis? Was it slight competition in soliciting trade at a an arrangement condemned by section 10,301, point or two where their assigned territories R. S. 1909 (formerly section 8966, R. S. 1899), joined. The evidence for appellant tended to which statute is analyzed and outlined show that, notwithstanding there were interabove? We think so. The organization of locking directorates in the wholesale comappellant was not unlike that of the celebrat-panies, there was still competition. Grant ed International Harvester Co., 237 Mo. loc. cit. 407, 141 S. W. 672. The appellant did not purchase the assets of the seven constituent companies in the ordinary and usual business methods of barter and sale. Nor did the seven constituent companies sell their good will and property in the usual method of honest barter and sale. These seven corporations had no bona fide purchaser, but from pure selfish, wrongful, and unlawful methods they conspired together and created a purchaser. The shuttlecock fiasco through which they went in organizing the appellant does not change the facts, nor hide their real methods. Appellant was but the result of a previous unlawful arrangement made in the very face of our anti-trust statute. Courts can look behind corporate entities and seek the truth. No man ever bona fide subscribed or paid a dollar of the capital stock of the Polar Wave Ice & Fuel Company. The whole performance, as revealed by this record, was a studied, premeditated "arrangement" to place the combined strength of these several individual corporations into one hand, and with a view of lessening competition in their business; i. e., the purchase and sale of ice in the city of

this to be true. The organization of appellant put an end to all such competition as well as the slight competition shown by the Muckermann companies. That the arrangement was so intended cannot be doubted by any sane thinking man, taking the facts of the record. That the dreams of the conspiring spirits were fully realized, at the expense of the buying public, is evidenced by the material growth of appellant since its organization. In the course of a short time it had not only charged off the "good will" account in its assets ($400,000 or more) and substituted cash in its place, but it had made improvements valued at $800,000, or better, and all the time paid dividends upon its stocks. Such unusual prosperity is not always the result of legitimate business methods, but usually the result of doing the things specifically condemned by our statute.

As stated above, the "arrangement" by which appellant came into existence smacks much of that condemned in the Harvester Co. Case, supra. Largely the same methods were followed. Vide opinion of Valliant, C. J., 237 Mo. loc. cit. 387-391, 141 S. W. 672. Further on the learned Chief Justice condemned the method in this language:

"The managers of these several corporations were men of conspicuous business intelligence; they would never have agreed to sell the prop erty of their companies and take pay in stock of a corporation to be formed unless they knew of what that corporation was to consist. The fact that they did not all get together and agree to merge their companies in one, but, on the contrary, each conducted its part of the scheme in form as if it were simply making a sale of its property, showing that they were acting in fear of the anti-trust statutes, and the fact that they did not all sign one contract, but each a separate one, shows caution to avoid the appearance of combination; yet, when all the several contracts were signed, the effect was the same as if they had all signed one con tract. And the fact that the representatives of the five companies were all in New York on that business at the same time, but stopping at different hotels and holding no communication with each other, again shows caution. had been no anti-trust laws in the land and If there these gentlemen had all concluded, in order to suppress what they call this unbusinesslike and ruinous competition, to unite their interests in one great company (as, in fact, they did), the most natural thing for them to have done would have been to meet together and talk it over and agree on the details. In the case above cited the Supreme Court of the United States, commenting on the comprehensive terms of the anti-trust act of Congress, which in that particular is like our statute, said: 'In view of the many new forms of contracts and combinations which were being evolved from existing economic conditions, it was deemed essential by an all-embracing enumeration to make sure that no form of contract or combination by which an undue restraint of interstate or foreign commerce was brought about could save such restraint from condemnation.' And so we say under our statute the form of contract under which this combination was brought about cannot save it from condemnation, and respondent cannot escape the result by saying it was not designed to suppress reasonable competition, but only the ruinous and unbusinesslike methods that were then in practice, because there is no such limit in the power conferred.

"We hold that the International Harvester Company, the New Jersey Corporation, is an unlawful combination to suppress competition and regulate prices within the meaning of our statute, and therefore it has no right to do business in this state."

To what the learned Chief Justice there said the writer hereof added the following: "The stock held by these trustees was held in proportion to the amount put in by these several component corporations, save and except certain amounts fully discussed in the principal opinion. Was this an arrangement or combination with the view of lessening competition? It was not a bona fide sale, because the sellers had to create their own buyer. It was a device to combine all their property into one huge concern, and for what purpose? In view of the fact and upon conscience can we say it was done with the view to lessen free and full competition. We think not. * * * Aggregations of large properties by bona fide purchasers in the usual business way do not fall under the ban of the statute, but when the would-be sellers have to erect a straw man for the purchaser, the credulity of the court is strained, when we are asked to brand it as a bona fide transaction. Viewing this case from any standpoint, it is clear that the merger of all these interests in one giant concern was made for the purpose and, to use the language of the law, 'with the view to lessen full and free competition,' all in violation of our statutes as they exist now and as they have existed since 1897."

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"There is no reason why the American Glucose Company should not have continued to it over to be prosecuted by a new corporation, prosecute its own business, instead of turning unless the officers, directors, and stockholders, making the transfer to the new corporation excepted, by suppressing competition, to fix and control prices, and thereby increase their own profits to the injury of the consumers of the manufactured products and of the public generfers of properties were not made by the six corally. It must be remembered that these transporations to a corporation already existing and doing business, but a new corporation was to be created, for the express purpose of taking and using the properties to be conveyed to it. transfers were made before the new corporation All the arrangements for the several was allowed to come into existence. The only purpose of its existence was to take and use, in a consolidated form, all the plants of the six old corporations. The illegal trust or combination was formed, not after the making of the sales, but by the sales themselves.

"The contention of counsel for the Glucose Sugar Refining Company that the American Glucose Company had a right to make a sale of its plant to the new corporation, and that this transaction must be regarded by the court merely as a valid sale, is not supported by the allegations of the pleadings, or by the proofs herein. The transfer of its property made by the American Glucose Company was a transfer to a corporation created for the express purpose of taking its property and the property of other corporations, so as to use them in the suppression of competition, and in the creation of a monopoly in the manufacture of glucose and grape sugar, and their products and by-products. The whole scheme as devised and consummated was a fraud, not only on the public, but upon the dissenting stockholder filing this bill."

Other cases might be cited and quoted from, but such would be to add to the volume of this opinion. The facts of this case bring it squarely within the announcements in the Harvester Case, 237 Mo. 369, 141 S. W. 672, and Standard Oil Case, 218 Mo. 1, 116 S. W. 902, in this court. Judge Shields, the trial judge in this case, prepared an elaborate opinion, and we are impressed with the following remarks contained therein:

"A few facts alone contain the gist of this case. There were seven Missouri corporations dealing in ice in the city of St. Louis prior to February 13, 1903. It is claimed that they were free and independent of each other and managed separately without regard to the interests of the others. The preponderance of the evidence negatives this claim. There was a conceded community of interests, as has been already shown herein, and a practical management by the incorporators of the new company, as herein shown. They controlled some 20 per cent. of the wholesale trade and 40 or 50 per cent. of the retail trade in the city of St. Louis. By a series of contracts and paper payments without the actual payment of a dollar to any one, the assets of the seven companies became the property of the respondent company, which transacts all of the business of the old compa

nies both in the wholesale and retail trade, and
controls from 50 to 60 per cent. of that entire
trade, both retail and wholesale, in the city of
St. Louis, yet the statutes of the state which
forbid combinations which tend to lessen or di-
minish competition are not violated, and the
amalgamation is justified on the ground that the
new company does not control the market.
"If the anti-trust statutes permit this, what is
to prevent all of the leading millers in the city
from organizing a monster corporation by a
series of contracts and fictional payment of cap-
ital stock, and exchanges of old stock for the
stock in the new company and thus put the man-
ufacture of flour in the city in the same hands?
What is to prevent all of the leading bakers
from doing likewise and controlling the greater
part of the bread manufacture in the city by a
giant corporation? What is to prevent the prin-
cipal dairies and milk dealers from amalgamat-
ing' by a similar process, or the druggist or the
coal dealers, or any other dealers in the neces-
saries of life from 'amalgamating' under a sim-
ilar process? It would not be expensive, for no
payment need be made except lawyers' fees,
and incorporation fees, but what would be the
condition of the city. In other words, the anti-
trust statutes are meaningless. This court can-
not consent to eviscerate the anti-trust statutes
by construction. They are beneficial laws, and
ought to be enforced, and not destroyed by cir-
cumambulation."

competition, and from parties rather finan-
cially strong, as we glean the facts from the
record. It also appears from the record that,
after the seven original corporations had
been able to perfect the title to their differ-
ent properties, they surrendered their char-
ters, and have no further corporate exist-
ence. It required a year or better to get all
titles perfected in appellant, close up busi-
ness, and surrender the charters.
it has been done, all the property is now held
However
by appellant, and being operated by appellant
as one concern. It is not a case where the
court can dissolve the appellant, and let the
property go back to the original corporations,
as in the federal International Harvester
Case. We have a case where ouster means
the taking out of the ice business in St. Lou-
is a large portion of the capital invested in
such business. It means the withdrawing of

a

trade, as we had in the Harvester Case in very substantial competition from the this court, 237 Mo. 369, 141 S. W. 672, supra. If by the dissolution of appellant we could separate its holdings and force them back to their original sources, such course might be well, but we have no such situation. We have a case here where there was a wrongful arrangement tending to stifle competition, but no evidence to speak of that warrants us to say that the new enlarged corporation has not been competing.

Under our statute (section 10,304, R. S. 1909), which in its present form was first enacted in 1907 (Laws 1907, p. 377), the trial court was authorized to enter a judgment forfeiting its corporate rights, and, in addition, could forfeit a part or all of its property to the state, "or in lieu of the forfeiture of its corporate rights and franchises, or in lieu of the forfeiture of all or any part of the property of such corporation, assess against it a fine." This judgment was not rendered until 1910, and the act of 1907 was therefore applicable. The statute supra is broad enough to cover four kinds of judgments, thus:, (1) Ouster of corporate rights and powers, but leaving the property to follow the course of all dissolved corporations; (2) ouster of corporate rights and powers, and, in addition thereto, a forfeiture to the state of a part or all of the corporate property; (3) a judgment ousting it of its corporate rights and franchises and a fine in lieu of a forfeiture of property; and (4) a fine in lieu of both the ouster of the corporate rights and franchises and the forfeiture of property. The court nisi chose the first form of judg ment.

Upon the record then the appellant was rightfully found guilty under the information. There is some question in my mind as to the punishment fixed, and this I take next: [3] III. In view of the situation presented by this record I am impressed with the idea that the judgment nisi is too drastic. That the very act of incorporating this appellant was an arrangement or combination in violation of our anti-trust laws stands out in bold relief upon the record before us. That this appellant was a party to such arrangement is verified by the fact that after it becomes a corporate entity it took over and received all the holdings of the seven original and constituent companies. Both in spirit and in flesh appellant was a part and parcel of a gigantic arrangement to thwart and stifle competition in the sale of ice, both at retail and wholesale. Its power to regulate production and price is apparent. There is a bit of evidence by one party that it threatened with its power to drive out competition by cutting prices below cost of production. It is also shown that it does from 40 to 50 per cent. of the St. Louis ice business. But, whilst these things are true, and we have not minurized them in the least, it is also true that the record shows the appellant to be in open competition with other ice concerns for the business of the city, and some of them of considerable proportions. It has its supply stations all over the city for rapid and efficient public service. Being under But this court has not always confined itone head, and being one body and one soul (if self to the statutory judgments. We have we may be pardoned the latter term), of held to our common-law powers in trust cascourse its different substations do not com- es. Vide Standard Oil and International pete with each other, but there is actual com- Harvester Co. Cases, supra. We have the petition from other ice dealers in practically same power in a case coming from the cirall sections of the city. This refers more par- cuit court, as we have in one originally ticularly to the retail trade. In the whole-brought here, and this not only because of sale ice business it has active and strong the common-law powers possessed by this

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