## Facts

- The United States sued United Shoe Machinery Corporation under Sherman Act §§ 1 and 2 seeking injunctive relief for alleged monopolization of shoe machinery and related markets.
- United was the dominant supplier of shoe machinery in the United States, supplying more than 75% of demand (excluding certain sewing machinery) and leasing machines to roughly 90% of shoe factories.
- United distributed the most important types of shoe machinery almost exclusively through long-term leases rather than sales.
- Leases commonly included restrictive provisions (including long terms and “full capacity” features) that discouraged lessees from using competitors’ machines or switching suppliers.
- United bundled machinery use with repair and maintenance services for a single, unsegregated charge, increasing customer dependence and complicating price comparisons with rivals.
- The government alleged that United’s leasing system, patent practices, acquisitions, and internal policies limited entry and foreclosed actual and potential competition.
- After a lengthy trial, the district court found monopolization in shoe machinery but not in shoe factory supplies or tanning machinery, and ordered extensive injunctive relief while declining a government-requested corporate breakup.
- The Supreme Court affirmed the judgment per curiam.
- The decree included a review clause allowing later modification based on whether it produced “workable competition”; later, the Supreme Court held that additional relief could be required if the monopoly had not been terminated.

## Issues

1. Whether United monopolized the shoe machinery market in violation of Sherman Act § 2.
2. Whether United monopolized or attempted to monopolize shoe factory supplies and tanning machinery markets.
3. Whether United’s lease-only distribution system and related terms constituted exclusionary conduct maintaining monopoly power.
4. What equitable relief was required to end the unlawful monopoly and prevent its recurrence, including whether structural relief was necessary.

## Decision

- The district court held that United violated Sherman Act § 2 by monopolizing the shoe machinery market.
- The court rejected § 2 monopolization claims as to shoe factory supplies and tanning machinery.
- The court found that United’s dominance was not attributable solely to superior products, efficiency, or other lawful competitive advantages; it was also maintained through exclusionary business practices, particularly leasing terms and bundled servicing.
- The court entered a decree imposing significant conduct remedies (including changes to lease practices and related restrictions) but refused to order the requested three-way corporate division.
- The Supreme Court affirmed the district court’s findings and decree per curiam.
- In later proceedings, the Supreme Court held that the district court had authority and responsibility to modify the decree if existing relief had not ended the illegal monopoly and removed practices likely to re-create monopolization.

## Legal Principles

- Sherman Act § 2 monopolization may be shown by monopoly power in a properly defined market plus maintenance of that power through exclusionary practices, not merely by size or success.
- Monopoly power is not excused where dominance is maintained by business practices that materially restrict actual or potential competition, even absent classic “predatory” conduct.
- A dominant firm’s long-term leasing arrangements and contractual restrictions can be exclusionary when they substantially deter customers from trying or adopting rivals’ products and thereby impede entry and expansion.
- Bundling essential services with product access, priced in a way that hinders comparison or replication by rivals, may support a finding that conduct maintained monopoly power.
- Antitrust equitable relief must be sufficient to terminate the illegal monopoly and prevent reasonably likely future monopolization; courts may modify decrees when initial relief fails to achieve that result.

## Conclusion

The court found that United unlawfully maintained monopoly power in shoe machinery through exclusionary leasing and related practices, ordered substantial injunctive relief short of breakup, and the Supreme Court later confirmed that remedial orders must be strengthened when necessary to end the monopoly and prevent its return.


United States v. United Shoe Mach. Corp., 110 F. Supp. 295 (D. Mass. 1953)