Antique Stock Tickers Stock Ticker Census
HENRY LAKE DAVIS (19 Mar 1832 - 25 Sep 1869)
Shortly after the Civil War, Henry L. Davis started the first wire service devoted entirely to commercial and financial news.
The Burnet House, Cincinnati, Ohio
Henry and his brother, Simon Davis, were Cincinnati bankers and brokers, and Simon belonged to the Cincinnati Chamber of Commerce and Board of Trade. As early as 1857, prominent men would gather every Wednesday and Saturday at the Chamber's Merchant Exchange to auction stocks and discuss matters of local and national commerce. They referred to themselves as the Cincinnati Stock Exchange, though the true CSE was not formally organized until 1885. In 1865, the Exchange members rented a billiard room for their gatherings at the Burnet House, a posh hotel famous for hosting Civil War round tables with Generals Grant and Sherman a year earlier.
In 1866, Henry started the Cincinnati Stock Exchange News Bureau to keep their merchants and bankers posted on the state of the stock markets. He secured many subscribers, and worked up a flourishing business by sending financial news prior to general publication from a New York office to his Cincinnati customers via Western Union telegrams.
In early 1867, Western Union took notice of Henry Davis, and saw the value in his enterprise. Until then, Western Union delivered general news over telegraph lines mainly to newspapers. But Davis proved there was a growing market of businesses and wealthy individuals, who would pay for fast and direct financial news. Western Union established a ''Commercial News Bureau" of their own for the purpose of furnishing these same market reports to various cities throughout the United States. An agent was appointed in Cincinnati, who offered to take Davis' subscribers off his hands and pay him $1,200 a year, a small percentage of what he was already making. Davis refused, whereupon Western Union told him they would ruin his business. They did.
Whenever Davis sent out telegrams, Western Union operators were instructed to delay them until their Commercial News Department (CND) could issue and dispatch their own reports in advance. Davis' clients were always "the last to know." After losing all his customers, Davis filed a lawsuit against Western Union for $10,000 in damages. He won and was awarded $3,000 in damages, plus $2,000 in costs. As part of Western Union's charter, telegrams are a public service and must be delivered in the order received with expedience. Delaying messages for their own profit directly violated this stipulation.
The trial was a monumental "David and Goliath" story, but none of the Cincinnati newspapers reported on the case for fear of retaliation. They all depended on Western Union's monopoly of news service.
Henry Davis didn't live to see the money. The verdict was rendered in May 1869, but Western Union appealed, and Henry died in September 1869 at age 37.
|The Cincinnati Enquirer, 25 Sept 1869 - We regret to announce the death of Henry L. Davis, which occurred at noon today, at the residence of his brother, S. S. Davis, Esq., in this city. Mr. Davis has been identified with the banking interest of our city for a number of years, though we believe he twice removed from this city to engage in the same business at other points. During the past two years he has been in his brother's bank in this city. He had been in ill health for some time, and during the past six weeks confined to the house, and, though seriously ill, his friends confidently hoped that he would recover. His genial manner and pleasant companionship attracted many friends, and he was noted for his habits of industry and unswerving integrity. The funeral will take place from the residence of his brother, Sunday afternoon.|
The court case was reheard in October 1870, and damages were lowered from $3,000 to $2,000.
Henry L. DavisV. Western Union Telegraph Company.
In the Superior Court of Cincinnati, October Term, 1870.
It is the duty of a telegraph company to transmit all telegrams in the order in which they are received, and one whose telegram has been wrongfully delayed may maintain an action to recover damages for the injury sustained by him.
Davis was engaged as a commercial news agent, to furnish to business men reports as to the markets, and for this purpose was accustomed to receive telegrams giving him information. The telegraph company, by a general order, gave an unlawful precedence to the telegrams of a similar and rival agency, and Davis brought an action against the company to recover damages for the injury sustained by him. Held, that he might recover damages for the general injury to his business.
This case was reserved from special term upon the defendants' motion for a new trial, the verdict below having been there rendered for the plaintiff.
The petition alleges that the plaintiff was engaged in Cincinnati as a commercial news agent, and in furnishing to bankers and brokers in that city, reports in regard to public securities, gold, currency, stocks, bonds, and merchandise, which reports the plaintiff received from his agents in New York city, and was enabled to deliver, and did deliver to his customers, in advance of information received in Cincinnati by other parties and from other sources; that he was accustomed to receive, and did receive, his reports from New York over the wires and lines of the defendants, an incorporated company under the laws of Ohio, having offices both in New York and Cincinnati; that on the 17th day of April, 1867, the defendants received in New York, from the plaintiff's agent, a dispatch in writing, properly prepared for transmission, in accordance with the rules of said company, which dispatch the defendants then undertook promptly, and in due course of business, and without partiality or favor to other persons, to deliver to the plaintiff at Cincinnati, for the usual price demanded for the conveyance of said dispatches; that the defendants, wrongfully and maliciously intending to injure the plaintiff in his business aforesaid, purposely delayed and hindered the sending and delivery of said dispatch, giving unlawful and improper precedence to another dispatch of a rival commercial news agency, known as the Commercial News Department, which was received by the defendants after the delivery of the plaintiff's dispatch, but was wrongfully forwarded and sent by the defendants to Cincinnati, and made public in advance of the plaintiff's dispatch, thus delayed and held back.
The plaintiff further alleged that on the 19th day of April, 1867, the defendants, in furtherance of their unlawful purpose, issued an order to their operatives and subordinates, as follows: "To all officers: When the letters C. N. D. are used, all operations must give way, as that business must have preference in everything;" that the letters "C. N. D." in said order were intended to denote the dispatches of a rival agency in the same business with the plaintiff, and in which certain officers of Western UnionTelegraph Company were interested, and given an unlawful advantage and precedence in the transmission of commercial news dispatches over the defendants' lines, in violation of the plaintiff's rights in the premises; and which order was enforced against the plaintiff, whereby the dispatches sent to him were interrupted and otherwise hindered in their transmission, whereby he suffered great loss.
The petition stated numerous other causes of action, similar to that stated in the first count.
The defendants, in their answer, denied all neglect of duty, and alleged that no preference was given to other companies or individuals, and that the plaintiff enjoyed all his rights in the transmission of telegrams.
On the trial at special term, the jury found $3000 damages for the plaintiff.
Corwine & Corwine, for the plaintiff.
Collins & Herron, for the defendants.
Storer, J. We are now asked, as the whole evidence is embraced in the record, to grant a new trial. No complaint is made of the charge of the court to the jury; the only question urged is that the damages are excessive. It is admitted by counsel that the testimony, although conflicting, was fairly left to the jury, and, as it was their province to reconcile it, the court may well suppose they performed that duty impartially; indeed, we cannot well conceive of a case where the sound discretion confided to the jury was more fully required to be exercised.
We have examined the bill of exceptions, and are satisfied the weight of the evidence was in favor of the plaintiff. The jury, it is said, should not have awarded more damages than the plaintiff could prove he had sustained; and the amount, it is claimed, could not, on the best estimation, be made to exceed $450. This sum, it is claimed, could not be increased by a computation of losses not clearly the immediate result of the defendants' misconduct. We admit, as a general rule, that the measure of damages for a breach of contract is the amount of loss really sustained by the injured party, but in the application of this rule a liberal course may be pursued whenever the violation of an agreement is proved to have been wilful or causeless on the part of the defendant.
In the case before us, it is in evidence that the plaintiff's business was not only affected so far as the direct injury he sustained by the neglect to forward the dispatches of his agent from New York to Cincinnati, but his business was finally broken up by the constant irregularities of the telegrams he ought in good faith to have received. And it is very evident the formation of a company, composed of the officers and stockholders of the telegraph company, whose object was to transact the same business in which the plaintiff had been previously engaged, gave to the defendants every facility successfully to compete with the plaintiff, as they had the control of their wires, and could prescribe, as they did, the rule by which their subordinates were to be governed; which appears, to use the language of the superintendent's order, at all times to give the precedence to those dispatches on which a private mark was affixed. It is evident that the mere allowance of the amount of loss the plaintiff proved he actually sustained would not, in justice, remunerate him for the violation by the defendants of their agreement; and the jury might very properly have given an additional sum. This, then, may have been in positive evidence to establish the real damages the plaintiff might have suffered.
The duty of a telegraph company, in the receipt and transmission of dispatches, requires promptitude, impartiality, and good faith on its part. There cannot be any preference permitted, or special favors granted, to any of those who may offer their dispatches for transmission; all are entitled to the same privileges, subject only to priority in time. He who first presents himself is to be first served. On any other theory, a telegraph company may become a perfect monopoly for favored parties; and, what is worse, a close corporation merely, for the benefit of the few to the prejudice of the many.
While holding this view of what the jury might have properly done, and what is the law of the case, we are satisfied the verdict was greatly in excess of the damages the plaintiff really sustained. We think there should be a remitter of $2000 from the verdict; and, if that is assented by the plaintiff, judgment will be rendered for the residue; if not, a new trial will be granted at defendants' costs.
Remitter assented to, and judgment entered on verdict.