The Burnham Chemical Company

 

Burnham

Burnham Townsite CA 1926-1929

Burnham Postcard

Burnham Postcard

George B Burnham was working as an engineer for the Solvay Chemical Company in Borosolvay when the plant shut down in 1921. Burnham patented 24 different processes for extracting various chemicals from the brine in Searles Lake.

Burnham believed he could be competitive with AP&CC and the other chemical companies. He was able to get the backing of investors, formed the Burnham Chemical Company and leased 2281 acres of Searles Lake from the US Government.

In 1926 the Burnham plant began shipping its first Borax. By 1929 the the other borax manufactures had undercut his prices so badly he could no longer make a profit. Burnham attempted to get financial backing to diversify and build a potash plant but then the stock market crashed and the Burnham plant was forced to close. 1929 was a bad year for many people.

Burnham shares

Burnham shares

Ten years later Burnham successfully sued his competitors for violating the Sherman Antitrust Act.

A quote from the stockholders report of New York Stockholders Committee of the Burnham Chemical Company, 2316 Ellis Avenue, New York:

April 17, 1929

On account of the drop in the price of borax from an average figure of $66.50 per ton to $13.00 per ton net at the [Searles Lake] plant, we made no profits . . . . The borax plant must be immediately adapted to the manufacture of potash. The drop in price appears to be part of a price war and possible production process patent infringement war with a large competitor, the American Potash and Chemical Company: With every attempt of our agents to sell our borax our competitor cuts the price lower, with the result that today the price of borax is only $19 per ton at the plant . . . the sacks alone cost $6.00 per ton. Of course, if we were to set out to build a potash plant it would be designed differently from a borax plant. It is somewhat of a makeshift proposition . . . but it is the best thing to do under the circumstances.

Burnham Plant

Burnham Plant

BURNHAM CHEMICAL COMPANY
v.
BORAX CONSOLIDATED, LTD., PACIFIC COAST BORAX COMPANY, UNITED STATES BORAX COMPANY, AND AMERICAN POTASH AND CHEMICAL CORPORATION.

Appellant was organized in 1921 for the purpose of producing borax in the State of California and in its complaint asserts that up to 1933 it had invested $1,168,564 in the development of leased property and a patented process. The great length of the complaint makes an adequate summary within reasonable limits of space an impossible task. Many of its 84 paragraphs deal with historic facts concerning the borax industry and charge generally that prior to 1929 world trade in borax was dominated by certain of the appellees, a domination which still exists as a result of unlawful monopoly practices of appellees.

It is alleged generally that appellees conspired in violation of Federal antitrust laws and committed certain overt acts in 1925 and 1928 in pursuance of the conspiracy or conspiracies which caused the damage to appellant and which gave rise to this action; that all of the acts done and performed by appellees or some of them were done with the intent and purpose of destroying appellant’s activities; that due to said intents, purposes and acts of appellees, the appellant had been damaged in the sum of $1,168,564.

The complaint alleges that for the reasons therein stated the plant and business of plaintiff were shut down and closed on or about January, 1929 since when its struggle for financial rehabilitation was unsuccessful, the resultant loss and damage to appellant being the amount above named, which is the exact amount demanded as a judgment against appellees in the prayer of the complaint.

Reference appears in the complaint, in the evidence at trial, and in the briefs on appeal, to what was declared to be appellees’ last “overt act” this act being generally spoken of as “The Little Placer” matter. This was a reference to appellant’s efforts (continuing up to filing of suit) to secure a Government lease on a certain tract of California land containing kernite deposits, and it claimed that its efforts before a Government agency were there thwarted by resisting activities of appellees. Relevance of this matter arises from the fact that at the trial the court asked appellant’s counsel what (overt) act of appellees occurring after 1929 resulted in damage to appellant, aside from the futile attempts to secure a Government lease on The Little Placer. Appellant’s counsel responded that nothing else had occurred; that appellant did not allege any other incidents in its complaint and that it could prove no damage from The Little Placer incident.

Appellant has at all times contended that its complaint is cast in a form which, while demanding treble damages for injuries to a private suitor resulting from violation of the Federal antitrust laws, is nonetheless a suit in equity and not an action at law. Here and below appellees have wholly disagreed with this argument. It presents an important question and we think it necessary to dispose of the issue at the outset by rejecting appellant’s theory regarding the character of its pleading, a view that we think finds support in the cases.

An examination of the complaint convinces us that its allegations clearly indicate an intention to state a claim for relief under the Sherman Act. They describe and charge injuries or damages, some sustained in 1924 or 1925, and others sustained as a result of acts (price cutting in 1928 by appellees) which forced appellant to close its plant and business in 1929. We think there can be no doubt that appellant’s action should be regarded as an action at law for damages predicated upon a liability created by statute, and not a civil action for equitable relief, as appellant would have it. The form in which the complaint is cast does not serve to disguise or change the basic nature of the claim upon which appellant rests its demand for relief. Where (as here) a private suitor asserts a claim under the Sherman Act for damages, the gravamen of the complaint is not the conspiracy. The damage for which a recovery is allowable is the damage which the suitor has suffered as the result of acts of the conspirators directed against him and committed in the course of the conspiracy and in furtherance of its purpose.

Burnham Borax Filter

Burnham Borax Filter

Burnham Chemical Company Patent for extracting borax from Searles Lake brine

George Burnham created his family tree and history in 1929 while he was living in Westend. It is viewable to members on Ancestry.com.

His original name was George Boots. His mother’s brother left him $500 in his will with the provision that he change his last name to Burnham. On Sept. 20, 1904 He legally changed his name from George Walter Bootes to George Walter Bootes Burnham in the Alameda County Courthouse. He graduated from California College of Electrical Engineering in 1911 and then went to work for General Electric until 1914.

Comments

  • We have 286 shares of the Capital Stock of Burnham Chemical Company dated second day of October 1924. What is the current value of said shares?

    J DAVID LUCKHAUPTMarch 14, 2014
  • Just a guess but I would say less than 50 cents a share.

    David L. StevensMarch 14, 2014

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