The vertical lug goes back to unlined lids made in the 1860's by the Sheet Metal Screw Company. Around 1871 the Sheet Metal Screw Company became part of the Consolidated Fruit Jar Company, which was formed to to bring together patents including those for Mason's 1858 jar and Boyd's 1869 glass-lined cap. Consolidated contracted to have various glass houses blow Mason jars, but it made many of the caps with vertical lugs itself.
In 1872 the patent office granted Rowley a patent that was nearly identical to Boyd's patent for the lined cap. Rowley was associated with Hero, which immediately began manufacturing caps with horizontal lugs for use on Porcelain Lined jars. Once Mason's 1858 patent expired, Hero also made its horizontally lugged cap for Mason jars.
Consolidated and Hero engaged in law suits over the conflicting patents, but the two companies eventually agreed to collaborate. Some later Consolidated caps feature the horizontal style lugs. The Supreme Court eventually invalidated Rowley's patent, and other companies were free to make lined caps (with or without lugs) once Boyd's patent expired.