Witnesses such as Rockefeller’s business partner, Henry Flagler, would testify that there were no illegal components of the deals made with railroad companies and that other companies received the same rebates. As a result, in 1899, owners of Standard Oil Interests formed Standard Oil of New Jersey as the holding company of the entire operation. Standard Oil’s monopolistic practices were brought to the public eye after a study by the federal Commissioner of Corporations was conducted from 1904-1906. At least seven other states and the territory of Oklahoma also did. Background Former attorney for the Standard Oil Company in Ohio, C.T. vaseline. He committed himself to his estates, philanthropy, golf, church, and the management of his increasing wealth. Her articles became the talk of the nation, but Rogers, who had been very frank with her, continued to meet with her. The Court found that Standard was an illegal monopoly and ordered it broken into 34 separate companies. Rockefeller was the largest stockholder of SO and retained the title of president even after retiring, which was a mistake from the public relation viewpoint. The case was made that Rockefeller and the Standard Oil Co. made an appealing offer to the railroad companies by offering continuous and exclusive business partnerships. He rose quickly to the top of Standard Oil. The state of NJ broke away from the traditional business law and revised its laws to allow the establishment of holding companies (corporations that could own stock in other corporations). Fall 2015: Kristeria Floyd, Casey Hall, Brianna Robinson, Ashley Thorne, Kristeria Floyd, Casey Hall, Brianna Robinson, Ashley Thorne. In November 1906, the Roosevelt administration subjected Standard Oil to a "good sweating" when it brought suit against the company under the Sherman Antitrust Act of 1890, for conspiring to restrain trade. Former attorney for the Standard Oil Company in Ohio, C.T. What is the myth that led the Supreme Court to break up Standard Oil in order to protect competition? The History of the Standard Oil Company is credited with hastening the breakup of Standard Oil, which came about in 1911, when the Supreme Court of the United States found the company to be violating the Sherman Antitrust Act. The managing editor of McClure's Magazine, Ida Minerva Tarbell, set out to investigate and write a narrative history on the Mother of Trusts, Standard Oil, in an attempt to expose the activities of the mysterious company. The respondent argued that Rockefeller sought out favorable business agreements that any other business had the ability to do and never did so with the intention of driving others out of the market. The Pennsylvania State University © 2020. Standard Oil was one of Roosevelt's most useful targets, and shortly after his election in 1904, his administration decided to investigate Standard Oil and the petroleum industry. It ordered Standard to break up into 34 independent companies with different boards of directors. At the time of the court decision, the monopoly of Standard Oil was evidenced by the fact that it transported more than 4/5 of all oil produced in PA, OH, and IN; refined more than ¾ of all American crude oil; owned more than half of the tank cars; marketed more than 4/5 of all domestic kerosene and more than 4/5 of all kerosene exported; and sold to the railroad more than 90% of all lubricating oils. The study found that Standard Oil was abusing control of pipe-lines, taking part in railroad discriminations and conducting unfair methods of competition. Standard Oil of Ohio – acquired by BP in 1987. His pre-ruling holdings in Standard Oil was approximately 25% of the company.

Consequently, Rockefeller and his partners continue to make extremely high profits. Her investigation would cover almost all parts of Standard Oil. What do you think of Tarbell's motivation? This actually created enormous wealth for the Rockefellers as many of those companies grew very … Standard was by no means politically helpless. Rogers, a senior director of the company. On May 15,1911, Chief Justice Edward White writing for the majority, the Court ruled that Standard Oil and the listed 33 companies affiliated were participating in “restrain[t to] trade and commerce in petroleum.” After thorough examination of English contextual meaning of reasonable restraint, Chief Justice White determined that the attempt to control the free market through fixed pricing, combinations/monopolies, and seeking to eliminate competition would be classified as unreasonable and thus illegal. Her father was a tank maker who aligned himself with the independents in the Oil War in 1872 against the South Improvement Company.

Standard Oil’s monopolistic practices were brought to the public eye after a study by the federal Commissioner of Corporations was conducted from 1904-1906.

Standard Oil of Indiana – renamed Amoco (American Oil Co.) – now part of BP. Theodore Roosevelt, former President of the United States. Standard Oil Company was first incorporated in 1870 by John D. Rockefeller and William Rockefeller. Continental Oil Company – now part of ConocoPhillips. The value of all the old SO stocks doubled, and Rockefeller's worth increased to $900 million, the equivalent of $9 billion today. One day in 1871, when Rockefeller was signing his name in the register of a hotel in Titusville, at a time when oil prices were low, he noticed someone who had confidently signed his name "John D. Archbold, $4 a barrel" above his name. That certainly caught Rockefeller's attention. South Penn Oil Co. – renamed Pennzoil, now part of Shell. This discovery led the US Department of Justice to begin a lawsuit in 1909, using the the Sherman Antitrust Act of 1890 as grounds for legal action.

This great answer was written by Quora User, Written and postred on Quora on Feb 27, 2014. Ida Minerva Tarbell was America's first great journalist. He distinguished between good and bad trusts and launched at least 45 anti-trust actions. A Standard Oil começou em Ohio, em uma sociedade formada por John Davison Rockefeller, seu irmão, William Rockefeller, Henry Flagler, o químico Samuel Andrews e o sócio passivo Stephen V. Harkness.. A Standard Oil se beneficiou de economias de escala e se transformou na maior empresa de petróleo do mundo. The justices, however, overturned a $29 million fine that the federal judge had levied against Standard Oil for violating the law by accepting rebates. The John A. Dutton e-Education Institute is the learning design unit of the College of Earth and Mineral Sciences at The Pennsylvania State University. Finally, a year after the dissolution of Standard Oil, shares for the successor companies doubled, and, in the case of Indiana, tripled. He promised the "square deal" (a package of moderate domestic reforms concerning consumer protection, conservation of natural resources, and regulating trusts/corporations) to Americans and was known as The Trust buster! The Ohio court decision in 1892 was for the trust to be dissolved and shares transferred throughout twenty companies. Milburn also showed that consumers were not hurt in the process and that prices remained the same for decades, creating a stable market which can not be said for many of the combinations and trusts being formed at the time. The argument was made that Rockefeller had obtained his monopoly through under the table deals, threats, and bribery with railroad companies in order to receive special rates that would give his companies and an unsurmountable advantage over his competitors in the regions. Why was Theodore Roosevelt gunning for Standard Oil? Ida met H.H. Standard Trust companies Carter Oil, Imperial Oil (Canada), and Standard of Louisiana were kept as part of Standard Oil of New Jersey after the … Was the Supreme Court decision required to restore competition? Top Standard executives saw the legal assaults coming, and they said if they were going to be put in jail, Rockefeller, as President, was coming with them! The public viewed it as a mysterious entity with arrogant directors who were accountable to no one. His successor, John D. Archbold, was known as an oil enthusiast and had worked his way up the corporate ladder starting as a shipping clerk.

The site editor may also be contacted with questions or comments about this Open Educational Resource.

John D. Rockefeller began to plan for retirement. Standard fought back by hiring the best legal talent, buying influence with political contributions, and even putting a senator on their legal team for a fee of $44,500. Lesson 1 - The Rise of American Oil and the Competitive International Industry, Lesson 2 - Standard Oil Trust and the Oil Wars, The Prize Chapter 5: The Dragon Slain: The Breakup of the Standard Oil Trust, The Prize Chapter 6: The Oil Wars: The Rise of Royal Dutch, the Fall of Imperial Russia, Lesson 3 - Asian Oil Development and World War I, Lesson 4 - Middle East Oil Development & the Rise of Automobiles & Gasoline, Lesson 8: Post-war Petroleum Order and Crises, Lesson 11: Supply Disruptions, Price Shocks & Oil Market Trading, Lesson 12: Unconventional And Climate Change, Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, Department of Energy and Mineral Engineering, Department of Materials Science and Engineering, Department of Meteorology and Atmospheric Science, Earth and Environmental Systems Institute, iMPS in Renewable Energy and Sustainability Policy Program Office, BA in Energy and Sustainability Policy Program Office, 2217 Earth and Engineering Sciences Building, University Park, Pennsylvania 16802. She grew up in the oil region and was an indefatigable and exhaustive researcher who wrote a biography of Madame Roland, leader of the French Revolution. He was the first to use the term "muckraker" for the progressive movement journalists. Archbold became secretary of the Titusville Oil Exchange and emerged as one of the leaders who, in a scathing attack, denounced Rockefeller during the South Improvement Company period and the Oil War of 1872. In late July 1911, Standard announced its plan for dissolution and divided into several different entities, here are some: Thus, finally, public opinion and the political/legal system had forced competition in the petroleum industry (exploration and production, transportation, refining and marketing). The value of Rockefeller's shares rose after the breakup as the new companies had a positive development …

She never married but was a celebrant of family life and an opponent of women's suffrage. Prices were as high as a $1/gallon in Europe. By 1915, thermal cracking was used in almost all gasoline production through licensing which created a steady flow of royalties to Standard Oil of Indiana. Ohio and Texas were the first states to launch minor legal assaults with anti-monopoly lawsuits. By so doing, he increased the yield of gasoline from 15-18% to 45%, and, for the first time, by 1910, gasoline sales exceeded kerosene. John Dustin Archbold (1848-1916), American capitalist, one of the United States' earliest oil refiners. The myth was pushed most publically by journalist Ida Tarbell (whose father and brother both competed poorly against Standard Oil) in the chapter "Cutting to Kill" in her The History of the Standard Oil Company, described by Thomas DiLorenzo as "a classic of antibusiness propaganda." A simplified answer is, when the US forced Standard Oil to split up due to ant-trust litigation, it created 34 separate companies, all of which John D. Rockefeller still owned significant equity in. For example, the low yield of 15-18% gasoline from refining a barrel of crude caused supply problems as demand was outpacing supply. In the old days of the Standard Oil monopoly, enforcers often broke up large entities by geography. She was a tall woman, about 6 feet, and a graduate of Allegheny College. Standard Oil of California – renamed Chevron. The Old House was under assault from commercial competitors in the U.S. and abroad as well as from the public and the government. Also, the American economy had shifted from a decentralized and competitive economy of many small firms into one dominated by industrial "trusts," and Americans looked to government to restore competition, control the abuses, and tame the economic and political powers of the "trusts."