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U.S. Supreme Court

People's Tobacco Co., Ltd. v. American Tobacco Co., 246 U.S. 79 (1918)

People's Tobacco Company, Limited v.

American Tobacco Company

No. 124

Argued January 4, 7, 1918

Decided March 4, 1918

246 U.S. 79


As applied to a corporation defendant, the provision of the Sherman Act of 1890, § 7, allowing actions for treble damages to be brought in the district in which the defendant "resides or is found" mean that the corporation must be present in the district, by its officers or agents, carrying on its business.

Upon consideration of the evidence, held that the defendant corporation of New Jersey undertook in good faith to carry out a decree of dissolution made by the Circuit Court in New York, and to divest itself of a former branch business in Louisiana, and that subsequent service of process, upon the former manager of that business in Louisiana was ineffectual to bind the corporation.

Defendant's revocation of its designation of a former manager of its chanroblesvirtualawlibrary

Page 246 U. S. 80

former branch business in Louisiana as its agent upon whom process might be served under the law of that state was effectual, notwithstanding the instrument of revocation, attested under its seal and filed with the Louisiana Secretary of State, was executed by a vice-president of the corporation, without formal sanction by the board of directors, it appearing that the vice-president acted with the knowledge and consent of the corporation in carrying out the decree of dissolution.

What constitutes such a doing of business as will subject a corporation to service of process depends upon the facts in each case. The general rule is that the business must be of a nature warranting the inference that the corporation has subjected itself to the local jurisdiction, and is, by its duly authorized officers or agents, present within the state or district where service is attempted.

The fact that a foreign corporation owns stock in local subsidiary companies does not bring it within a state for the purpose of service of process upon it; nor does the practice of advertising its wares in the state and sending into it its agents who, without authority to make sales, to collect money, or extend credit, merely solicit orders of the retail trade to be turned over to local jobbers, to whom the corporation sells its goods and who charge the retailers therefor.

The Louisiana Act of 1904 (Laws 1904, Act No. 54, p. 133), as amended in 1908 (Laws 1908, Act No. 284, p. 423), providing for service of process on the Secretary of Louisiana, is not applicable, as construed by the state supreme court, to foreign corporations which have withdrawn from the state and ceased to do business there at the time of service, as in this case.


The case is stated in the opinion. chanroblesvirtualawlibrary

Page 246 U. S. 83

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