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Antitrust Keyed to Morgan, 7th Ed.
United States v. Trans-Missouri Freight Association
Citation:
166 U.S. 290, 17 S.Ct. 540, 41 L.Ed. 1007 (1897)Facts
In March 1889, eighteen railroad companies operating in the western United States formed the Trans-Missouri Freight Association. The association’s stated purpose was “mutual protection by establishing and maintaining reasonable rates, rules and regulations on all freight traffic.” The agreement created a structure for setting rates, with provisions for voting on rate changes, penalties for violations, and procedures for addressing competition from non-member railroads. After the Sherman Antitrust Act was passed in July 1890, the government filed suit in January 1892, alleging that the association violated the Act by restraining trade and commerce. The government sought dissolution of the association and an injunction against similar future agreements. The defendants argued that the Sherman Act did not apply to railroads, which were regulated by the Interstate Commerce Act, and that their agreement was reasonable and beneficial to the public. During the litigation, the association formally dissolved, but the member railroads formed a similar organization immediately afterward.
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