126 AGRICULTURAL MACHINERY AND TRUST QUESTION 



The Independent Harvester Company. A few years ago 

 twenty-seven thousand farmers brought suit against the Inde- 

 pendent Harvester Company of Piano, Illinois. These farmers 

 held over six million dollars of stock in this company. Since this 

 company was so widely advertised as a cooperative concern, and 

 as a farmer's company, and in this guise secured the farmers' 

 support, a brief account of its operations is in place here. It was 

 neither a farmers' company nor a cooperative concern. 



Troubles under the old management of this company came to 

 a head when a committee of farmer stockholders in the summer of 

 1913 brought in a report and filed a bill in the United States Dis- 

 trict Court at Chicago, containing seventy-one counts against the 

 management and praying for relief. Some of these counts set 

 forth that the then management of the company had " organized 

 a stock selling campaign, and for four years or more have devoted 

 all the time and energy of the officers and a large number of em- 

 ployees of the corporation to selling stock, have expended large 

 sums in advertisements, employed sales agents for stock, commis- 

 sions as high as thirty per cent of the sales . . . That stock sales 

 were conducted for the sole purpose of paying salaries, expense 

 accounts, and profits to the individuals in the management; that 

 more than $3,000,000 worth of stock has been sold during the past 

 two years; that the management diverted the corporation's 

 purpose from manufacturing machinery to the sale of stock; 

 that it conspired to continue stock sales and neglect manufac- 

 turing; that the mismanagement and fraudulent misrepresenta- 

 tions of defendants so injured the reputation of the company 

 and its products that advertisements were refused by farm and 

 other journals," etc. 



This company gave the impression in its advertising that it 

 was a farmer's cooperative company. Some so-called cooperative 

 journals carried this fraudulent advertising. Many refused it. 

 The president of the company in reply to a letter from the editor 

 of a genuinely cooperative journal, wrote: "We do not consider 

 ourselves strictly cooperative, and whether we can be made so is 

 problematic. We have tried to figure it out from all standpoints, 

 but it seems as though the law at the present time and the way in 

 which we are organized would not permit of it in the same sense 

 as the Rochdale plan ... On the other hand, we have about 

 three thousand farmers that are voters of the company, and the 

 balance, about thirteen thousand, are non-voters. . . . We are 

 expecting to spend $30,000 in advertising between now and March 



