The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1903-12-16
Pointing to its Violation
in Merger Case.
COMPETITION SLAIN
Knox Indicates Clearly That the North
ern Securities Company Created
a Monopoly Of Transporta-
ton and That This Was
its Purpose.
its Purpose.
(By the Associated Press.)

(By the Associated Press.)
Washington, d. c., Dec. 15.-Argumert
in the Northern Securities case was re-
sumed in the United States Supreme
Court today and again the court room was
crowded by attorneys and others inter
ested in the case. Attorney General Knox
was recognized almost Immediately after
the court came IN, and resumed his argu-
ment at the point at which he left cff
when court adjourned yesterday. He
declared that by the union of the North
ern Pacific and the Great Northern in the
Northern Securities Company, two com
netting inted-State railroads have been
brought into such relations that lneir
independence as competitive factors in
interstate commerce is destroyed.
The thing that has been done was de-
clared illegal, he said, when brought
about by the methods pursued in the joint
traffic and Missouri eases. There
were cases of contracts or agreements
between independent and competing lines
of railroad for the regulation of traffic
charges. The government charged that
these agreements restrained interstate
contention.
The Attorney General said that it was
not his intention to re-argue any of the
propositions settled by the trans Missouri
and joint traffic cases, but to do what
he could TO- show their application to the
facts of this case. He. however. made
the following statement OF the great
questions settled by the court in those
cases
First, that to shut out the operation
of the general law of competition between
competing interstate railroads is to re-
strain interstate commerce.
Second, that to bring the operations
of two or more competing Interstate
railroads under the control of a single
body shuts out the operation of the gen.
eral law or competition and constitutes a
restraint upon interstate Commerce.
Third, that Congrfss iz competent to
forbid any manag .1.ent or combination
among companies competing for inter
State commerce which rcstrains commerce
among the States by shutting out the OPP
Grafton of the general law of the compe-
tition.
Fourth, that in order to maintain a
suit the govs rrnent is not Obliged to
show an intent to restrain commerce II
such restr~ ut is the natural and neces-
sary effeo. of the arrangement"
He then se:d:
THE testimony shows ooncluslvely, l
think, that as matter OF fact and law
the merging which these gentlemen did
was to create combination in the form
of trust, the form specifically prohibited
by the act of Congress, if it restrained
interstate Commerce; and also that the
Northern Securities Company was formed
for the purpose of taking over the con-
troll of the Great Northern and Northern
Pacific railroads and actually took over
that control, and with that control abso-
lutte power over both roads, the thing
which your honors have said constitutes
such restraint under circumstances sub
;stantially the same as those of this
case"
Mr.. Knox discussed the end accom-
plished by the merger of the railroad
interests. saying:
THE device resorted to IN this case,
if sustained, defeats the rolicy or the
law, as it acccmplishes all the more IN
the way of effected destruction OF COM
petition than was accomplished in the
trans Missouri and joint traffic cases.
.1You NAV call it a merger, combina-
tion. a pool, a conspiracy, a cnsolidatlon,
a contract, a securities company, or what
YOU like. The thing it accomplishes is
not varied by a variation In name or
manner of bringing it about.
"The great object of Congress was to
declare a policy against which no ar
rangement could stand by which the
parties fully equip themselves with the
power to defeat its purposes.
He declared that the power to suppress
competition has been exercised. He as
serted that they executed that power and
actually suppressed and destroyed COM
petition the moment they parted with the
legal title to their segregated holdings
ard vested them in the Northern Securi-
ties Company This he contended ac-
tually destroyed competition between the
two roads. and in support of this state
mert. he laid down the following general
propositions:
TO be competition there must be COM
petitors In different interests.
ANY act which eliminated the compe-
titors or unifes the interests destroys COM
petition
There is no competition where the net
results of operation go into a common
purse.
There may be rivalry between the diff
ferent departments or agencies as to
which will contribute the most to the
common fund or as to which is the most
economically administered or operated,
but so long as all are interested in the