## Facts

- The United States sued United States Steel Corporation (a holding company) and affiliated steel producers in equity under the Sherman Antitrust Act, seeking dissolution and related structural relief.
- U.S. Steel was formed in 1901 by consolidating multiple large steel concerns; the government alleged these units were combined into a “super-combination” intended to dominate the iron and steel trade.
- The government alleged the consolidation unduly restricted competition across major steel product lines and enabled price increases and maintenance above competitive levels.
- Defendants denied monopolization and unlawful restraint, asserting the consolidation reflected industry development and that substantial competition persisted, with prices moving with supply-and-demand conditions.
- The record included evidence of U.S. Steel’s participation, after formation, in some efforts with competitors to stabilize or maintain prices; defendants contended such efforts were not ongoing when suit was brought.
- A four-judge district court dismissed the bill; the judges agreed on dismissal but differed in reasoning. The United States appealed directly to the Supreme Court.

## Issues

1. Whether U.S. Steel’s size, structure, and market position constituted monopolization under Sherman Act § 2.
2. Whether U.S. Steel engaged in unreasonable restraints of trade under Sherman Act § 1, including price-fixing or coordinated conduct.
3. Whether dissolution or other equitable relief was warranted based on past, discontinued practices absent an ongoing violation or a dangerous probability of recurrence.

## Decision

- The Supreme Court affirmed dismissal of the government’s bill.
- The Court held that U.S. Steel’s power, though greater than any single competitor’s, was not shown to be monopoly power within the meaning of the Sherman Act.
- The Court found that identified price-stabilization efforts were temporary, had been abandoned before suit, and did not support structural relief without evidence of intent or dangerous probability of resumption.
- The Court rejected the claim that competitors’ voluntary price-following, without more, established an unlawful restraint.

## Legal Principles

- Formation with an expectation of monopoly is insufficient; liability requires proof of monopoly (or unlawful restraint) within the Act’s meaning.
- Size, capital, and productive capacity are not unlawful by themselves; mere power to restrain competition is not enough if not exercised in a prohibited way.
- The Sherman Act targets overt unlawful conduct; equitable relief to “prevent and restrain violations” focuses on actual violations or realistic threats, not speculative future misuse of power.
- Competitors’ voluntary adherence to a dominant firm’s prices does not, standing alone, prove an agreement or unlawful restraint; the law does not require rivals to compete.
- Past restraints that were transient and discontinued do not justify dissolution absent evidence of intent to resume or a dangerous probability of recurrence.

## Conclusion

The Court declined to dissolve U.S. Steel, holding that large scale and industry leadership did not establish a Sherman Act monopoly and that abandoned, short-lived price-maintenance episodes, without a demonstrated likelihood of recurrence, did not warrant prospective structural relief.


United States v. United States Steel Corp., 251 U.S. 417 (1920)