DuPont Powder Trust Ordered Dissolved, But Family Control and Geographic Proximity Limit Effectiveness

Following a 1911 Sherman Antitrust Act lawsuit, the U.S. District Court for Delaware ordered the DuPont Powder Company dissolved and divided into three independent entities: the reconstituted DuPont, Hercules Powder Company, and Atlas Powder Company. DuPont had controlled approximately two-thirds of the explosives market and all gunpowder for the U.S. military through ownership of 40 plants nationwide. The government’s case began after former DuPont sales agent Robert S. Waddell alleged in 1906 that the “Powder Trust” was bilking the government of $2,520,000 annually through monopolistic profits. However, the breakup proved largely ineffective at creating genuine competition. The DuPont family retained substantial financial interests in all three companies, with Pierre and Irenee DuPont holding large stock blocks. Hercules headquarters was located across the street from DuPont in Wilmington, Delaware, and “breathes heavily Dupontized air” according to Fortune magazine. The new company was staffed by executives transplanted directly from DuPont headquarters. As late as 1970, the president of Hercules was related to the DuPont family. The three companies were convicted during World War I of joint price-fixing, with DuPont assessed a $40,000 fine. Moreover, DuPont itself retained its monopoly on manufacturing gunpowder for the U.S. military—supposedly the primary object of the antitrust action. This case demonstrates how early 20th-century antitrust remedies failed when family ownership, geographic proximity, and executive relationships maintained underlying connections between supposedly independent companies—a pattern that would repeat throughout antitrust history.