
When General Electric formed the Radio Corporation of America or RCA with Marconi assets in 1919, conflicts over patents prompted a push for cross-licensing agreements with the other large electrical and telephone interests. In addition to RCA, General Electric, AT&T and Westinghouse, a fifth partner in the patents pool was the United Fruit Company, a conglomerate whose primary business was banana production in Latin America.
The United Fruit Company actually started out in the railway business: In 1871, U.S. entrepreneur Henry Meiggs signed a contract with the government of Costa Rica to build a railroad connecting the capital city of San José to the port of Limón. He was assisted by his nephew, Minor C. Keith, who took over Meiggs’s business after his death in 1877. Keith began experimenting with the planting of bananas as a cheap source of food for his workers. When the Costa Rican government defaulted on its payments in 1882, Keith had to borrow money from banks and private investors to keep going.
In exchange for this, and for helping renegotiate Costa Rica’s own debt, in 1884 the government agreed to give Keith 800,000 acres of tax-free land along the railroad, plus a 99-year lease on the operation of the train route. The railroad was completed in 1890, but the flow of passengers proved insufficient to finance Keith’s debt. However, the sale of bananas grown in his lands and transported first by train to Limón, then by ship to the United States, proved very lucrative. Keith eventually came to dominate the banana trade in Central America and along the Caribbean coast of Colombia.
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