American Banana Company v. United Fruit Company

213 U.S. 347 (1909)

Facts

P is an Alabama corporation. D is a New Jersey corporation. Before P was formed D had the intent to prevent competition and to control and monopolize the banana trade. It bought the property and business of several of its previous competitors, with provision against their resuming the trade, made contracts with others, including a majority of the most important, regulating the quantity to be purchased and the price to be paid, and acquired a controlling amount of stock in still others. D organized a selling company so it could sell at fixed prices all the bananas of the combining parties. D monopolized and restrained the trade and maintained unreasonable prices. Entered McConnell in 1903. He started a banana plantation in Panama, then part of the United States of Colombia, and began to build a railway (which would afford his only means of export), both in accordance with the laws of the United States of Colombia. D told McConnell that he must either combine or stop. Two months later, at D's instigation, the governor of Panama recommended to his national government that Costa Rica be allowed to administer the territory through which the railroad was to run, and this although that territory had been awarded to Colombia under an arbitration agreed to by treaty. D and then the government of Costa Rica interfered with McConnell. In November 1903, Panama revolted and became an independent republic. In June 1904, P bought out McConnell and went on with the work, as it had a right to do under the laws of Panama. In July, Costa Rican soldiers and officials, instigated by D, seized a part of the plantation and a cargo of supplies and have held them ever since, and stopped the construction and operation of the plantation and railway. A fellow by the name of Astua, by ex parte proceedings, got a judgment from a Costa Rican court, declaring the plantation to be his. D then bought the lands from Astua. P sued D in a United States district court. P alleged a conspiracy between D and the Costa Rican government to steal P’s property in Panama. P alleged that D monopolized the banana trade. P alleged that D had violated the Sherman Act but did not allege that anything D did was illegal under Panamanian law. The court dismissed the complaint and it was affirmed by the court of appeals. The Supreme Court granted certiorari.