Northern security Co. Vs.
US
Jacob Romeo
http://ehistory.osu.edu/osu/mmh/1912/trusts/NorthernSecurities.cfm
Origin of Northern security company
•
At the turn of the 20th century J.P Morgan was The most powerful investment
banker in Wall Street, with holdings in the Northern Pacific Railroad
•
James J. Hill was the founder of the great Northern railroad
•
Hill and Morgan teamed up and controlled the Burlington Railroad, which
connected the Twin Cities of Minnesota with Chicago and extended deep into the
grain belt of the upper Midwest.
Collaborators
• John D. Rockefeller also helped finance
Northern securities. They also gained the help
of Edward Harriman who was trying to
acquire the Burlington, Quincy, and Chicago
railroads earlier.
American-buisiness.org
Cause of the case
• Roosevelt's Department of Justice prosecuted the
Northern Securities Company for violating the
Sherman Act.
• The Sherman act is based on the constitutional
power of Congress to regulate interstate commerce.
It declared every contract, group, or conspiracy that
restrained interstate and/or foreign trade illegal.
•
: Sherman Antitrust Act — Infoplease.com http://www.infoplease.com/ce6/history/A0844878.html#ixzz1viZ4vqnu
• After that the Northern securities company
sued in order to repeal the act.
• However they were judged guilty on a 5-4
ratio of judges in the supreme court.
Result
The courts decided that the Northern
securities company was unconstitutional and
the company was dissolved.
This was a huge victory for Theodore
Roosevelt. Not only did he gain his reputation
as a trust buster, he also proved that the
power of the executive office was greater than
companies
Change in policies
• Federal incorporation started to become
more prominent
• After this case, a gentleman’s agreement
practice emerged between J.P Morgan and
other companies, and Roosevelt’s
administration.
Work cited
• American-buisiness.org
• ehistory.osu.edu
• American-buisiness.org
•
: Sherman Antitrust Act — Infoplease.com
http://www.infoplease.com/ce6/history/A0844878.html#ixzz1viZ4vqnu