New-York tribune., 1902-05-06
OUT OF FEDERAL REACH
SAYS ANTI TRUST ACT Is IN
APPLICABLE.
NORTHERN SECURITIES COMPANY'S AN
SWER TELLS STORY OF IT'S ORIGIN,
ITS HOLDINGS AND ITS REA-
SONS FOR EXISTING
SONS FOR EXISTING.

St. Paul, May J-"An enterprise in aid of a
great competitive interstate and international
commerce. is the description of the Northern
Securities Company given in the answer filed by
the attorneys for that corporation in the suit
brought by Attorney General p. c. Knox on be-
half of the United States to enjoin the so-Called
merger of the Northern Pacific and Great North
railways This answer was filed late this
afternoon in the United States Circuit Court in
this city and at the same time individual
swers were filed by James J. Hill William p.
Clough. D. Willis James John :. Kennedy,
George F. Baker and the Great Northern Rail-
way and by ]. Pierpont Morgan. Robert Bacon.
Daniel s. Lamont and the Northern Pacific Rail-
way Company.
These various papers follow the same lines.
The answer of the Northern Securities Company
is divided into two parts The first is largely
denial of the petition. respecting any charge Of
conspiracy, and respecting the purposes of the
organization Of the securities company. In
stead of owning a majority of the shares of the
Great Northern or of the Northern Pacific com
pany, II Is stated that those who are interested
in the organization of the securities company
did not own within $26 900 of a majority of
the Great Northern shares. and little more than
quarter of the Northern Pacific shares
This part of the answer also states that the
securities company has acquired by transfer on
the Great Northern books about five-twelfths
of that company's stock. has negotiated for
about four-twelfths of the total of such stock,
which has not been transferred and as to which
ii has at present no voting power, and has paid
on account of Great Northern and Northern
Pacific schares purchased more than S40.OOo.
600 i'm cash: that many stockholders have not
sold and may not sell shares. and that neither
company. by any act suggestion, has
lcited shareholders TO sell to the securities
company.
In the second part of the answer. the pur-
chase Of the Chicago. Burlington and Quincy
Railroad Company is taken up. the reasons for
such purchase having been, ii is alleged. "er
roneousIy stated in the petition" Attention is
called 10 the sparsely settled or unsettled
nature OF the country through which the Great
Northern runs: the abundance of raw ma
terials. to be hauled at low mileage rate; the
great timber wealth in the Pacific Northwest; ;
the necessity of return load for the cars TAX
ing this timber 10 the prairie States; the de-
velopment of trade with Eastern Asia as
means OF securing such return loads, and the
establishment Of a connecting steamship line
for that purpose. II is stated that:
In the Interstate and international commerce
which the Great Northern Company has thus
built up. il completes both in this country and
on the ocean with the other transcontinentaI
lines Including the Canadian PacthC), and AT
the Oriental ports IL competes for commerce with
the world. It's rates and must be made in
competition with the rates Of ocean carriers and
by way of the Suez Canal The policy thus
followed by the Great Northern Company in
building up an interna tioual and thereby an in
terstate commerce has been followed by the
Northern Pacific Company since its reorganiza-
tiOn in 1876. r'--
ROADS WERE AT. A DISADVANTAGE.
1t is said that both roads We're placed at
disadvantage with other trauscontuentaI rail-
roads. as Well as with European competitors. by
the want OF sufficiently direct connection with
the territory Offering the best markets for the
products Of the country alone their lines and
with the places Of production and great centres
Of distribution from which their traffic must be
supplied. The lines OF the Burlington better
than those Of any other company fulfilled the
requirements OF both roads in respect Of mar
kets for eastbound and freight for westbound
traffic. The answer recites these various mar
kets and their products and continues:
The price paid for said Burlington stock was
lower per mile of main track covered by the
stock than that for which the stock of any
other large and well established system in the
same general territory could then have been
bought The purchase Of the Burlington stock
by the Northern Pacific and Great Northern
companies, In equal parts served each company
as we'll II il We're the sole owner OF such