Science Fair Project Encyclopedia
Sherman Antitrust Act
The Sherman Antitrust Act was the first government action to limit trust companies (A corporate front for a combination of firms or corporations who agree not to lower prices below a certain rate for the purpose of reducing competition and controlling prices throughout a business or an industry). It was passed in 1890 and was named for its author, Senator John Sherman of Ohio. It made illegal any form of contract or combination between entities in regards to trade and commerce that would have the effect of restraining trade. And it also put responsibility on government attorneys and district courts to pursue and investigate trusts.
The Act was not used in court cases for some years, but Theodore Roosevelt used the Act extensively in his Anti-Trust campaign and managed to divide the Northern Securities Company. It was even further used by President Taft to split and divide the American Tobacco Company and the Standard Oil trust. The Act was aimed at regulating the businesses of the time, but it was not specific (It did not specifically refer to a monopoly, instead prohibiting unlawful business combinations). It was used for many years as an anti-union tool, until that use was finally revoked in 1914 by the Clayton Antitrust Act, which contained the word monopoly.
There have been many supplementing acts to aid the Sherman Act in preventing monopolies. Some of these were the Clayton Antitrust Act in 1914, Robinson-Patman Act of 1936 and the Hart-Scott-Rodino Antitrust Improvements Act of 1976 among others.
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