The Montgomery advertiser., 1903-04-02

dent and General Manager. who had been in charge of operation under c. P. Huntington for many years, made an af- fidavit, wherein. regarding the improve nents being made on the Central Pacific line, Mir. Kruttschnitt said that the ne- cessity for them had been fully recogniz- ed by the Huntington management.
 Improvements Necessary.
 Mir. Kruttschnitt says in positive terms that all of the Improvements in question are absolutely necessary, not only to re- duce the expense of operation, but also to enable the company to hold its traffic and compee with rival transcontinental lines. He denies that the improvements were ever suggested by any officer of the Union Pacific, but all were planned and have been urged by officers exclusively of the Southern Pacific in its own inter- ests alone.
 J. c. Stubbs, Third vice-President of the Southern Pacific, in charge of traffic. and Traffic Director of the Union Pacific. denies in a sworn statement that any traffic whatever has been at any time diverted from the Southern Pacific to the Union Pacific.
 Afidavits were also filed by William Sproule, Freight Traffic Manager and E. O. Mccormick, Passenger Traffic Manager of the Southern Pacific, wherein those officers testify that neither has at any time received any directions or in- structions to favor the Union Pacific as against the interests of the Southern Pacific, and that they have not done so but that each. in the management of the department under his supervision, has worked exclusively for the interest of the Southern Pacific.
 Otto KnHn DQmhar 0f the firm of Kuhn, Loeb & Co.,, and director of the Southern Pacific, filed an affidavit in which the following appears:
 During the past twelve or thirteen months Edward Lauterbach of counsel for the complainants in this action, re- peatedly spoke to me on the subject of the Keene pools holding of Southern Pa ciic stock.
 Lauterbach's Proposition.
 ''The substance of his statements werc to the effect that he had been retained by James R. Keene, in connection with contemplated action to bring suit to oust the interests at present in control of the Southern Pacific Company. but that he thought it desirable in friendli- ness to both interests that no such con- fiict should take place, but that there were only two ways of avoiding hostile proceedings, namely, either to buy the holdings of the Keene pool at the price of about 70 or to start the payment of divi- dends on the stock at a rate of not less than 4 per cent per annum.
 "I answered Lauterbach that we would not consider purchasing the pool hold ings. and that in determining the policy of the company in regard to dividend pay ments, the directors were acting and would continue to act in accordance with their best judgment and would not allow any other consideration to infiu ence them nor be turned by threats of troublesome litigation, from pursuing what. after conscientious deliberation. they felt to be the only right course for the interests of the property"
 William Mahl, the Comptroller, filed an affidavit, appended to which are ta- bleS showing earnings, expenses, etc., of the different lines since the Union Pa- cifics interests were acquired as com pared with previous years. It appears therefrom that as compared with the year ending June 30. 1900, the gross earn ings of the Central Pacific line in 1901 in- creased4. 29 per cent, whereas the earn ings of the other lines of the Southern Pacific increased S.51 per cent, and for the year 1902. the earnings of the Central Pacific increased 4.46 per cent while the earnings of the other lines of the South ern Pacific increased 7S per cent. James R. Keene who Is confined to his l room in the Waldorf Astoria made public today the following telegram sent by him tonight to Edward Lauterbach, his counsel, who Is In Nashville: Hartman and Kuhn affidavits pub lished broadcast I expect you to furnish | the Associated Press with your answering affidavits immediately, setting forth the true facts, that no offer to sell stock was ever made by me except In reply to their request to purchase the hold ings which I represented. and that you were requested by them to answer to cost of same and that I absolutely re- fused when I made answer. to sell my 1 individual stock at any price"