Competition record
American Tobacco
Deep profile · 1 linked library matter
American Tobacco was the cigarette trust the Supreme Court ordered broken up in 1911. This library id is that historic remedy.
Overview
The American Tobacco trust gathered cigarette manufacturing into one combination. It bought rivals and used exclusive arrangements around leaf tobacco and distribution so that a new cigarette brand had little room to reach smokers or tobacco supply.
In 1911 the Supreme Court held that the combination had monopolized the trade and ordered it dissolved. The remedy was a breakup into separate cigarette companies, so manufacturing was no longer in a single trust. The library status is remedy.
Leaf merchants and would-be rival brands had been dealing with a single combination. The Court ordered that combination taken apart, and the library records the breakup as the remedy.
Competition footprint
The trust's power was over the making and distribution of cigarettes, a consumer product sold in huge volume.
Buying rivals and locking up supply were the tools the case condemned.
The recorded outcome is dissolution of the combination, not a monetary penalty.
Consumer & business angle
Smokers bought brands that had been gathered into one manufacturing trust.
Independent cigarette makers were the firms the acquisitions and exclusive deals were built to absorb or exclude.
What to watch
- How the 1911 breakup is cited when a court is asked to split a consumer monopolist.
- The parallel, in the same year, with the Standard Oil dissolution, which is a different company and a different decree.
Markets
cigarettes · tobacco products
Also known as: american tobacco company, tobacco trust