Ottumwa semi-weekly courier. [volume] (Ottumwa, Iowa) 1899-1903, 1902-03-13
THE GOVERNMENT OPENS
FIGHT ON THE MERGER

- ~ OBSERVATION-DISCLOSURES vi IIlc INoltlSl
Pacific and Great Northern systems
n to place restraint upon all compel
tive interstate and foreign trade or
commerce carried on by them, and to
m%onopolize or attempt to monopolize
the same, and to suppress the compe-
tition heretofore existing between said
railway systems in said interstate and
foreign trade,or commerce, through the
instrumentality and by the means fol-
lowing, to-wit: A holding corporation,
to be called the Northern Securities
Co., was to be formed under the laws
of New Jersey, with a capital stock of
$500, 900 900, to which, in exchange for
its capital stock upon a certain
basis and at a certain rate, was to be
turned over and transferred the CAPT
tai stock, or a controlling interest in
the capital stock, of each of the defend
ant railway companies.
Eliminate Individual Stockholders.
In this manner the individual stock
holders of these two Independent and
competing railway companies were to
be eliminated and a single common
stakeholder the Northern Securities
Co., was to be substituted; the interest
of the individual stockholders in the
property and franchises of the two rail
way companies was to terminate, be-
ing thus converted into an interest in
the property and franchises of the
Northern Securities company. The in
dividual stockholders of the Northern
Pacific Railway Co. were no longer to
hold an interest in the property or
draw their dividends from the earn
in orc nf 1hG Nn-fhnrp Dopifn crctor,
and the individual stockholders of the
Great Northern Railway company
were no longer to hold an interest in
the property or draw their dividends
from the earnings of the Great North
ern system, but having ceased to be
stockholders in the railway companies
and having become stockholders in the
holding corporation, both were to draw
their dividends from the earnings of
both systems, collected n distribut-
| ed by the holding corporation. In this
manner, by making the stockholders of
each system jointly interested in both
systems for the benefit of the former
stockholders of each, and by vesting
the selection of the directors and Off
GERS of each system in a common body,
to-wit, the holding corporation, with
not only the power but the duty to
pursue a policy which would promote
the interests, not of one system at the
expense Of the other, but of both at
the expense of the public, all induce
ment for competition between the two
systems was to be removed, a virtual
consolidation effected, and a monopoly
of the interstate and foreign commerce
formerly carried on by the two systems
as ~indepedent competitors established
Northern Securities Co. Organized.
"In further pursuance of the unlaw.
full combination or conspiracy afore.
said, and solely as an instrumentality
through which to effect the purposes
thereof. on or about November IA
1901, the Northern Securities Co. was
organized by the election of a board OF
directors and the selection of a presi
dent, James j.. Hill and other officers
who, with their associate stockhold
ers of the Great Northern Railway
Co., assigned and transferred to tn,
Northern Securities Co. a large
amount of the capital stock of the
| Great Northern Railway Co, constitut
ing a controlling interest therein, I'M
complainant believes a majorit.
luSIGOl, upon Inc dSEeSu OASIS VI GA
change Of $3.50 par value, OF the cap
: ital stock of the Northern Securities
5 Co. for each share of the capita
! stock of the Great Northern Railwa.
} Co., and the defendants, J. Pierpon
Morgan and his associate stockholC
: ers OF the Northern Pacific Railwa,
Y Co., assigned and transferred to tn
. defendant, the Northern Securitie
I Co., a large majority of the capita
e stock of the Northern Pacific Railwa.
S Co., upon the agreed basis of eXchang
e of $115, par value, of the capital stoc,
of the Northern Securities Co. fc
each share of the capital stock
v the Northern Pacific Railway Co., an
/ thereafter the Northern Securities CO
offered to the stockholders of the de
PENDANT railway companies to issu
and exchange it's capital stock for til
capital stock of such railway con
pany upon the basis of exchange afor'
said, no other consideration being II
CURED.
The defendant, the Northern Secul
ties Co., has acquired an addition
c amount of the stock of the defendal
railway companies, issuing in lie
v thereof its own stock upon the basis
; exchange aforesaid, and is now hol
ing owner and proprietor, substantis
If ly all of the capital stock of the Mort
# ern Pacific Railway Co., and, as col
l. ~plainant believes, a majority of IL
capital stock of the Great Northel
Railway Co. By reason, whereof,
virtual consolidation under one owne
ship and source of control of the Gre
Northern and Northern Pacific railwf
systems has been effected, a combin
ton or conspiracy in restraint of tt
trade or commerce among the sever
states and with foreign nations forme
E, ly carried on by the defendant railw;
companies Independently and in fir
II competition, one with the other, h
II been formed and is in operation, a.
ie the defendants are thereby attemptil
lc to monopolize, and have monopolize
Vi such interstate and foreign trade
le commerce to the great and irreparat
u, damage of the people of the Unit
States, in derogation of their comm
ne rights, and in violation of the act
nc congress of July 2, 1890, entitled,
Act to Protect Trade and CONNER
Against Unlawful Restraints and N