The Montgomery advertiser., 1902-03-25
TO PREVENT MERGER
HEARING OF SUIT COMMENCE
 BY PETER POWER.
Jacob Schiff and Charles Steele of J P. Morgan 6 Co., on the Wit ness Stand-Actions in
 Other States.

New York, March ,24.-The hearing in the suit commenced by Peter Power in the United States Court for the District of Minnesota. for the purpose of deter mining the standing before the law of the purchase and holding of Northern Pacific and Great Northern stock by the Northern Securities Company was continued this afternoon.
 Jacob H. Schiff, of the firm of Kuhn Loeb & Co.,. was questionetd by A. NJ Boutelle of Minneapolis, of counsel for Peter Power. MT. Schiff said that as far as he could recollect the purchases made by his firm of Northern Pacifis before May last year amounted to SIS, ,OO0, OOO A few weeks later this stock was trans ferred part to the Union Pacific and part to the Oregon Short Line. The Un- ion Pacific's Northern Pacific stock was sold to J. P. Morgan Co. and payment was made in nine or ten millions of dol lars cash and eighty or ninety millions Of dollars in stock of the Northern Se- curities Company. MT. Schiff said the Union Pacific and the Oregon Short Line sold their Northern Pacific because they thought it would be good thing to get profit on their stock.
 Charles Steele of J. P. Morgan x Go. testified that his firm organized a syndi- cate to raise $50, GOO 600 cash in order to buy control of the Burlington. The ob- ject of the purchase was to reap the profits that would result from getting Eastern and Southeastern connections for the Burlington. MT. Steele said there never had been any iron bounr agreements between MT. Hill and MT. Morgan that they would hold on to their Northern sold $10.000,000 of their so. 090,000 of North ern Pacific common to the Northern Se- curities Company, receiving stock of the Northern Securities Company in return.
 hA nrfh ri tjdC 0rNsaV1 t, Il pair 's90 100000 for the seventy-five mll- lions worth of Northern Pacific common.
 Questions asked the witness by MT. Stetson. counsel for the firm of J. P, Morgan & Co.,, were for the purpose of disproving the claim of the latter side that the negotiations for Northern Pa cific common. the Burlington purchase the formation of the Northern Securities Company, and the placing of MT. Harri- man and other representatives of the Union Pacific interests on the board of the Burlington and Northern Pacific, were all part of a pooling scheme which originated and matured during the sum- mer of 1901 previous to the formation of the Securities Company. with MT. Morgan. MT. Hill and Mir Hartman and their associates as the principal factors. MT. Steele said there was no prior un- derstanding that after they had acquired the Northern Pacific stock from the Har riman interests; it was to be put into the Northern Securities Company
 point brought out on cross eXamlna- tion was that th"-e never was any contest for the Northern Pacific common. Witness said this contest did not exist outside of the newspapers. It was this contest, the existence of which the witness denied. that eliminated in the panic of May 9 last
 On redirect examination MT, Steele said the plan for buying the holders of the preferred stock out at par was adopted because the directors decided upon that as just and equitable arrange ment and that it was not for the pur- pose of throwing the control of the road into the hands of those who held the SIS. .OOO, 900 worth of the common stock.
 An adjournment was taken until We'd nesday when MT. Morgan will be heard