State of Louisiana v. American Cotton Oil Trust

May, 1887.

1. Corporation ; trustees of stock usurping corporatefranchise. Quo Warranto.] An action lies in the name of the State, by the attorney general,—under general provisions of law authorizing such actions ■ when any persons usurp a franchise or act as a corporation without being duly incorporated,—to enjoin as illegal an unincorporated association organized for the purpose of acquiring a majority of the stock in each of several corporations engaged in the same line of business as each other, thereby to secure control of such corporations, and which association, in pursuance of this purpose, issues its certificates in exchange for such corporate stock to represent shares in the equity in the property hold by the trustees of the association, and which, though not a corporation nor claiming to be . such, is thus acting as a corporation, within the state.

*4602. The same.] The organization, and the acts characteristic of the associations known as trusts for obtaining the control of numerous corporations, are acts that can be done only by a corporation ; and an association that assumes such powers can be enjoined.

3. Injunction against sale of trust certificates.] In an action for such purpose, the traffic of the public in the trust certificates caunot be enjoined by enjoining brokers who simply buy and sell for their customers, and arc not employed by the association.

(The case is reported in 1 Railway & Corp. L. J. 509.)