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Proposed Merger Of Rail Companies Banned


In Northern Securities Co. v. United States, the U.S. Supreme Court upholds the Sherman Antitrust Act and prohibits the consolidation of railroad companies Great Northern and Northern Pacific Railway. The two companies run parallel lines from the Great Lakes and Mississippi River to the Pacific Ocean; their incorporation would effectively monopolize rail transportation in those regions. The Court asserts that the Antitrust Act is enforceable not only in instances when an entire industry is monopolized by one corporation, but also when the incorporation of multiple companies is shown to be significantly detrimental to interstate commerce.