Evening star. [volume] (Washington, D.C.) 1854-1972, 1903-12-23
TO STIFLE COMPETITION
PURPOSE OF NORTH
WESTERN RAILWAY MERGER.
Brief Of the State of Minnesota Against
the Northern Securities Company
Filed in Supreme Court.

The brief of the state of Minnesota, in its
suit against the Northern Securities Com
pany, has been filed in the United States
Supreme Court. 1t contends that the mer-
ger of the Northern Pacific and Great
Northern railroad companies into the
Northern Securities Company was for the
purpose of sitting competition.
After stating that the action was brought
to enjoin the consolidation of the two rail-
road companies because they are parallel
and competing lines within the state of
Minnesota, and that the circuit court of
the United States of the eighth circuit de-
cided the cases contrary to the contention
of the state, the attorneys present their
assignment of errors on the part of the
circuit court.
Alleged Errors of Court.
There are twenty-nine of these assign
ments, but the principal ones are that the
decree is erroneous in that the Northern
Securities Company was not organized for
the purpose of consolidating the two APP
pellee railway companies; that the owner
ship of the stock of the two railway COM
panies by the Northern Securities Com
pany does not amount to consolidation
within the meaning of the acts set forth
in appellants bill; that the Northern Sc
curities Company does not, in fact, con-
troll the two railway companies by virtue
Of it's ownership of the stock of such rail-
way companies and in not holding that
the Northern Securities Company was in
tended by it's incorporators to be and is a
device for evading the laws of the state.
In the course of the relation of the facts
of the consolidation of the two roads refer
ence is made to the joint circular letter of
the Northern Pacific and the Great North
ern roads on January %, 1902, and it is
declared that the effect of this circular
letter was to withdraw all competition for
business between the railroads within the
state of Minnesota and to compel the ship
per to ship freight via the road having the
shorter route or else pay to the road hay
ing the longer route greater freight rate;
land not only" they say, was all compe-
tition, far as rates We're concerned,
withdrawn destroyed but all effort to
secure business and all the benefits result
ing therefrom to shippers on the line OF
said railroads within the state of Mime
sofa were absolutely destroyed
Purpose of the Merger.
In their argument on the facts in the
&C Sc counsel contend that the two lines
are both parallel and competing, and that
the Northern Securities Company was Or
ganized solely for the purpose of con-
soidating and unfying the control of the
Great Northern and Northern Pacific rail-
way companies, and as a means Of eVad1ng
the laws of TIL, state of Minnesota pro-
hibiting such consolidation. After pre-
senting the authority for these statements
the attorneys present the following con-
illusions:
TT is clear that the controlling stock
holders of the Great Northern Railway
Company, including Mr. Hill, and the con-
trolling stockholders of the Northern Pa
ctfic Company, including Mr.. Morgan,
agreed during the summer and fall of 1901
to organize the Northern Securities Com
pany for the purpose of turning over to
that company the absolute control of both
railway companies, and thus to place the
property of the Two railway companies
under a single or unified management, and
to prevent either company doing any act
hostile to the interests of the other, or
entering into competition with the other,
so as to lower rates or solicit business; in
other words to as effectively stife compe-
tition and destroy whatever benefit might
result therefrom to the public as though
the entire system of railroads of each
company within the state Of Minnesota
were owned and controlled by a single ope-
rating railroad corporation or individual"
Arguing the law points in the case they
say:
1.-THE acquisition of a majority of the
capital stock of the Great Northern and
Northern Pacific Railway companies by
the Northern Securities Company effects as
complete a consolidation of the property