United States v. Sidney W. Winslow

227 U.S. 202 (1913)


Prior to February 7, 1899, competition with reference to the different kinds of shoe machinery was so distributed between the different groups that a shoe manufacturer had 24 different choices for obtaining shoe machinery. By the organization of the United Shoe Machinery Company and the coalescence into one of the three groups of businesses formerly carried on separately by D, the variety of choice was reduced from 24 ways to 16 ways. Lasting machines, welt-sewing machines, and outsole-stitching machines were all now offered by United Shoe Machinery Company (D). Each of the merging companies made just one machine did not compete with the other merging companies. D then adopted a 'tying' clause lease, which forced manufacturers to either get all their machines from D or independents. That immediately reduced from 16 to 2 the different ways by which a manufacturer could equip his factory. The end result was that 70 to 80 percent of all the shoe machinery business was controlled by D. This combination into one group of four non-competitive businesses (which, taken together, constitute one complete business) curtailed the customer's liberty of action. P insists that when a combination acquires between 70 and 80 percent of the total trade in a particular business, the line between legal and illegal combinations has been passed. Ds argued that the indictment did not state a cause of action under the Sherman Act.