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Communication Law Keyed to Benjamin, 2nd Ed.
United States v. Aluminum Co. of America
Citation:
148 F.2d 416 (1945)Facts
The Aluminum Company of America (Alcoa) was founded in 1888 and had been the dominant producer of aluminum in the United States for decades. Initially, Alcoa’s monopoly was legally protected by patents until 1909. After the patents expired, Alcoa maintained its position as the sole domestic producer of virgin aluminum ingot. By the time of the trial, Alcoa controlled over 90% of the virgin aluminum ingot market in the United States. The company had systematically expanded its production capacity, securing control of bauxite deposits and water power sources necessary for aluminum production. Alcoa was also vertically integrated, producing both raw aluminum ingot and fabricated aluminum products. This integration allowed Alcoa to engage in a “price squeeze” by charging high prices for ingot to competing fabricators while setting low prices for its own fabricated products. Additionally, Aluminum Limited, a Canadian company formed in 1928 when Alcoa transferred its foreign properties, participated in an international cartel (the “Alliance”) that restricted aluminum production and potentially affected imports into the United States.
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