The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-08-01
STATE LOSES.
Northern Securities Case De-
cided in Favor of Company.
Circuit Judge Lochren Hands
Down His Decision.
INJUNCTION REFUSED.
Holds That No State Law Has
Been Violated.
Decision Has No Effect OH Gov.
ernment's Pending Suit.


ren, today in the United States circuit
court, handed down his decision in the
case of the state of Minnesota against
the Northern Securities company, the
Great Northern Railway company, the
Northern Pacific Railway company and
James j. Hill, as president of the North
ern Securities company and individual
J ~, in which he sustained the conterl-
tions of the Defendants and dismissed
the bill of complaint of the state He
finds that the Northern Securities COM
pany has not violated the state laws for
bidding the consolidation of parallel ani
competing lines OF railway. through it's
| ownership Of the stock of the Great
Northern and Northern Pacific railways
/ He refuses the injunctions asked by the
state OF Minnesota, to restrain the Sc
curities company from voting the stock
/ OF the two railroad companies or either
Of them.
This decision affects the results of the
federal governments victory in the cir
cult court in no way whatever The
federal suit involved the same defend
| ants and the same general state of facts,
/ but was based on a totally different con-
tention, of law.
The federal suit in which the Securi-
! ties company was beaten was prosecil-
/ ton for violation of the Sherman anti
trust law passed by the federal con-
gress.
The state suit. in which the Securities
! company wins, was based on an allega-
tion that the defendants violated acts
of The Minnesota legislature forbiddiny
the consolidation of parallel and COM
peting lines of railway.
The hearing OF the state suit was be
gun Friday, June s. before Judge Loch-
rem in the federal circuit court 1t fol-
lowed the submission of much testimony
by both sides for rDany months in which
Frederick G. Ingersoll of this city acted
as referee. The final argument lasted
/ five days in which Attorney General
/ Douglass, former Attorney General Geo.
/ 3. Wilson and Attorney NJ. D. Mum,
spoke for the state, and George b.
! Young, NJ. D. Grover and c. w. Bum
for the defendants. The case was sub
mitted Wednesday, June 10. An appeal
| to the United States supreme court Is
now pending in the federal suit
Judge Lochren in his decision says in
part:
The defendant, the Great Northern
/ Railway company, is a Minnesota cor
poration which has. as stated in the bull,
acquired the property, rights. and frah-
! chises and the management and control,
! of various specified railway corpora
tions That the defendant, the Northern
| Pacific Railway company, is a Wiscon-
sin corporation which filed its articles of
/ Incorporation in Minnesota and in 1896
purchased and acquired all the railroad
rolling stock and franchises of the ear
Iier Northern Pacific Railroad company;
and he also stated III the bill acquired
( the property rights and franchises and
4 the mana cement and control of other
specified railway corporation. That said
Great Northern and Northern Pacific
| companies now and for many years,
| severa1ly own, operate and maintain
main line of railway extending from the
cities of Duluth, ST. Paul and Minnea0-
! oils. westward across the state of Min
nesota, North Dakota, Montana, Idaho
and Washington to Puget Sound; with
many branches along the route of each.
| and that said two systems of railroads
are as to each other parallel and COM
peting lines of railroad; at least between
! cities and towns reached or traversed by
| the lines of both of said two railways
among which are Duluth, St. Paul, Min
neapolis, t.nonta, ST. Cloud, Moorhead.
East Grand Forks, and several other
towns in the state of Minnesota: and
that a reasonable degree of competition
1 for the traffic between places so situa-
/ ted on both said lines of railway has
existed in the past years"
After reciting the act passed by the
| Legislature of 1874 forbidding the consol-
idating of parallel railroads, alcs the act
of 1881 permitting one railroad company
| to consolidate it's stock and franchise
with the stock of any other roads when
it might be connected and operated to-
gether to constitute continuous main
line with or without branches. and call
ing attention to the fact that the same
statute reiterated the prohibition against
consolidating parallel and competing
lines, Judge Lochren calls attention to
the Passage o the antitrust law by the
/ state legislature in 1899 forbidding COM
binations in restraint of trade or COM
merce between the state of Minnesota
and other states and its penalties. and
then gives a complete history of the
merger proceedings. Under conclusions
of law the court says, after reviewing
a number of supreme court decisions on
| the Sherman antitrust act:
''The proper construction of the Sher-
man antitrust act. so far as it relates
to railroad transportation as deduced
from these decisions of the supreme
court appears to be this:
THE act applies to railroads: and all
/ contracts made between railroad COM
panies for the purpose and having the
! effect of preventing competition by fix
ing rates, or empowering persons to fix
/ them, and agreeing to conform to them
when fixed. are in restraint of trade and
within the provisions of the statute
whether the rates so fixed are reasonable
or unreasona BILE.
That contracts between divers man
ufacturers of a commodity respecting
their sales of that commodity to be de-
| Iivered by them outside the state hax-
iTsg the direct effect of sitting competi-
ton and raising the cost of the article
to the purchaser are also in restraint
of trade and within the statute
THAT contracts which do not directly
and necessarily affect transportation or
rates therefor are not in restraint of
trade. or within the statute. even
though they may remotely and Indirect
/ 1y appear to have some probable effect
/ in that direction.
THE state antitrust act must have
the same construction in respect TO
traffic on railroads within the state.
Neither the Great Northern company
nor the Northern Pacific company were