Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1903-03-19
Claims Wabash Employees Were Guiltless
Beside Hill Faction.
RATES NEW JERSEYS RECKLESS CHARTER
Declares No Other State Would Grant Un-
limited Rights
YOUNG REPLIES FOR RAILROAD MAGNATEs
briefly sketches History of Lines TO
Coast, showing How Trade Was
Gradually Built Up to
the East.

ST LOUIS, Mo-. March 1s--For the first
time In history, and by authority Of a spe-
cial act of congress, four United States
circuit judges are sitting together to hear
arguments in the fight OF the government
against the Northern Securities company
Under this special act the United States
circuit court for the district OF Minnesota
is holding its session in st. Louis, and by
this arrangement the case can go immedi-
ately from this court to the supreme court
OF the United States and thus save from
two to three years.
The four judges before whom the case is
being argued are Judges Caldwell, Sanborn
Thayer and Van Devanter, Judge Caldwell
presiding
The attorneys for the government are
Games M. Beck and William H. Day, d. T.
Watson Of Pittsburg and d. p. Dyer Of St.
Louis.
For the Northern Securities company are
John W. Griggs George B. Young OF St.
Paul, NJ. d. Grover. general attorney for
the Great Northern railroad. and c. W.
Bum, general attorney for the Northern
Pacific.
Most of todays session was taken up
with an elaborate argument presented by
Assistant Attorney General Beck. After
he had concluded an argument for thu
Northern Securities company was begun
by former Judge George B. Young.
Mr.. Beck began speaking soon after court
convened at 10 O'Clock and with the excep-
tion Of two hours he spoke continuously
until 5:52.
He referred to the Wabash injunction
case, saying the laws we're such that en-
ployes Of a railroad who did not own cent
of stock, or rail OF the road, could
be enjoined from striking and thereby inter-
fering with the Interstate commerce act by
stopping traflc, but that unless this court
so ruled the government was powerless to
prevent the owners of railroads themselves
from merging preventing competition and
thereby interfering with the very rights
the interstate commerce act sought to pro-
tect.
Try to Override Public VIII.
In his argnmsft Attorney Beck said. In
part:
1t would be difficult to exaggerate the i'm
have ever been presented to any court
which affected corporate interests of such
magnitude, and still fewer which more
vitality concern the welfare OF the Ameri-
II Competing carriers can form a stable,
permanent and controlling combination
with indefinite and perpetual powers,
through the simple device Of a so-called
state charter form which is far more
inimical to the public interests than the
trafic arrangements or technical trusts
which the law has hitherto condemned
then both the Interstate commerce act
q iSS7 with its iphI6ition q ROoling and
condemnation of all combinations in re-
straint of trade or attempted monopolies,
viduais. who will thus show the i'm
potence of the declared will of the Ameri-
can people.
Mr.. Beck then reviewed the corporate
nf hn har N
Pacific and Union Pacific systems He re-
ferred at length to the attempt made in the
year 1898 by the Northern Pacific and
Great Northern interests, to unite their
respective systems, and quoted at length
from the decision Of the supreme court in
the case of Pearsall against Great Northern
Railway company declaring the attempted
amalgamation unlawful
New jersey Reckless with Charters.
There was considerable discussion as to
what charter could be secured to protect
such extraordinary powers. After careful
consideration by eminent counsel, Il was
finally decided that the state which had won
a bad pre-emnence for its reckless sale OF
corporate privileges to secure petty fees,
was the state whose protective power
should be invoked. Accordingly, the char
ter was applied for In New Jersey on Mo-
was nothing more than, the exchange OF
certificates Of ownership the buyers were
the sellers and the sellers we're the buyers,
with this important difference, that the
part owner OF the property OF the Northern
Pacific railway, or the Great Northern,
found himself part owner of the property
Of both.
Had the two constituent companies for
mally consolidated, no different results
would have been accomplished. Had the
Great Northern and Northern Pacific for
mally merged their corporate identity and
issued new capital stock In retirement AM
exchange for the re-existing holdings. the
result would have been precisely the same
as in the exchange for the certificates o
the Northern Securities, with the single
exception OF the name. Between a tech
nical merger and a transfer to the so-callet
holding company is the difference between
tweedle-dum and tweedle-dee.
obtains Extraordinary Powers.
Mr.. Beck then analyZed the charter o
the Northern Securities company. and said
Such extraordinary powers were neve
yet granted 70 corporation unless 1t b,
words, it's powers may be classified as fol
ID Infinite in scope.
(O Perpetual In character.
CD Vested I'm the hands of a few,
Cd BY methods secret even to stockhold
ers.
Ii will be interesting TO follow out tn
possibilities of such corporation. The OF
lginal idea OF the holding corporation, a
explained by noted fnanciers. Is to enabl
the minority to rule the majority,
A majority OF the Northern Securitie
company, namely S20l OO0, 900, controls tn
burlington, Northern Pacihc and Grea
Northern systems and all subsidiary com
panies whose aggregate capitalization, in
cluding funded debt, exceeds N.O0O.00O OOl
but the board OF directors, whose holding
OF Northern Securities may be compare
lively insignificant, can, during the tenur
power TO act and 20 use the seal OF IN
corporation at pleasure. This committe
may only be three In number, and q ma
t0rfty Is determinative Thus, In the las
analysis, two men may control the uu
limited powers OF the holding company
which in turn controls the vast powers Q