United States Supreme Court
227 U.S. 202 (1913)
In 1899, the vast majority of shoes in the United States were manufactured with the assistance of three groups of machines: lasting machines, welt-sewing machines, and outsole-stitching machines. In February 1899, three shoe-machine companies (defendants) decided to merge, forming the United Shoe Machinery Company (USMC). Prior to the merger, the three shoe-machine companies had manufactured between 60 and 80 percent of all the lasting machines, welt-sewing machines, and outsole-stitching machines in the United States. Each company only made one type of machine, and none of the companies were in direct competition with each other. After the merger, USMC operated out of a single factory and continued to produce the types of machines that had been previously manufactured independently. The United States (plaintiff) brought an action against the shoe-machine companies, alleging in part that the merger violated the Sherman Act as an unreasonable trade restraint. The district court held that the charges were not actionable. The United States Supreme Court issued a writ of error to determine whether the shoe-machine companies had actually been charged with actionable offenses under the Sherman Act.
Rule of Law
Holding and Reasoning (Holmes, J.)
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