UNITED STATES V E C KNIGHT COMPANY 156 U.S 1 1895 UNITED STATES V E C KNIGHT COMPANY U.S CONSTITUTION U.S GOV'T JUDICIAL BUSINESS/COMMERCE U.S GOVERNMENT AND CONSTITUTION SIGNIFICANCE IN THIS CASE THE SUPREME COURT INTERPRETED FOR THE FIRST TIME THE CONSTITUTIONALITY OF THE SHERMAN ANTITRUST ACT OF 1890 THIS RULING AFFIRMED CONGRESS'S RIGHT TO REGULATE COMMERCE BUT LIMITED THE SCOPE OF THE ACT THE COURT RULED THAT THE ACT DID NOT APPLY TO INTRASTATE MANUFACTURING COMBINATIONS BACKGROUND CONGRESS PASSED THE SHERMAN ANTITRUST ACT IN 1890 BECAUSE OF THE PUBLIC'S CONCERN ABOUT THE GROWING POWER OF BIG BUSINESSES IN TRANSPORTATION INDUSTRY AND COMMERCE THE ACT WAS DESIGNED TO PROHIBIT MERGERS BETWEEN COMPANIES THAT WOULD HINDER FREE COMPETITION IN 1894 THE FEDERAL GOVERNMENT ATTEMPTED TO USE THE ACT TO DISSOLVE THE AMERICAN SUGAR REFINING COMPANY WHICH WANTED TO PURCHASE FOUR SUGAR REFINING COMPANIES INCLUDING THE E C KNIGHT COMPANY THIS ORGANIZATION HAD ACQUIRED THE STOCK OF ITS LEADING COMPETITORS AND IN THIS WAY HAD GAINED CONTROL OF THE PRODUCTION AND DISTRIBUTION OF ALMOST ALL REFINED SUGAR IN THE UNITED STATES THE FEDERAL GOVERNMENT ARGUED THAT THIS MONOPOLY SEVERELY LIMITED FREE TRADE AND HURT AMERICAN CONSUMERS DECISION THIS CASE WAS ARGUED ON OCTOBER 24 1894 AND DECIDED ON JANUARY 21 1895 BY A VOTE OF 8 TO 1 JUSTICE MELVILLE FULLER SPOKE FOR THE COURT JUSTICE JOHN HARLAN DISSENTED THE COURT REJECTED THE FEDERAL GOVERNMENT'S SUIT FULLER ARGUED THAT THE PROCESS OF MANUFACTURING WAS DISTINCT FROM COMMERCE SUGAR WAS REFINED IN INDIVIDUAL STATES THEREFORE SUGAR REFINING WAS NOT CONSIDERED INTERSTATE COMMERCE STATES AND NOT THE FEDERAL GOVERNMENT HAD THE AUTHORITY TO REGULATE MANUFACTURING IN ADDITION THE MONOPOLY CREATED BY THE AMERICAN SUGAR REFINING COMPANY ONLY INDIRECTLY AFFECTED COMMERCE BECAUSE ALL THE SUGAR WAS PRODUCED IN INDIVIDUAL STATES THE SHERMAN ANTITRUST ACT COULD ONLY BE USED WHEN COMPANIES DIRECTLY RESTRAINED INTERSTATE COMMERCE EXCERPT FROM THE OPINION OF THE COURT DOUBTLESS THE POWER TO CONTROL THE MANUFACTURE OF A GIVEN THING INVOLVES IN A CERTAIN SENSE THE CONTROL OF ITS DISPOSITION BUT THIS IS A SECONDARY AND NOT THE PRIMARY SENSE COMMERCE SUCCEEDS TO MANUFACTURE AND IS NOT A PART OF IT IF IT BE HELD THAT THE TERM COMMERCE INCLUDES THE REGULATION OF ALL SUCH MANUFACTURES AS ARE INTENDED TO BE THE SUBJECT OF COMMERCIAL TRANSACTIONS IN THE FUTURE IT IS IMPOSSIBLE TO DENY THAT IT WOULD ALSO INCLUDE ALL PRODUCTIVE INDUSTRIES THAT CONTEMPLATE THE SAME THING THE RESULT WOULD BE THAT CONGRESS WOULD BE INVESTED TO THE EXCLUSION OF THE STATES WITH THE POWER TO REGULATE NOT ONLY MANUFACTURES BUT ALSO AGRICULTURE HORTICULTURE STOCK RAISING DOMESTIC FISHERIES MINING IN SHORT EVERY BRANCH OF HUMAN INDUSTRY
