Omaha daily bee., 1903-04-03
KEENE FIGHT NEARS END
Arguments in Southern Pacific Case Due tC
Close Today.
WISHES UNION PACIFIC TO APPEAR
Senator Foraker Admits that suit
Must Fail ~ Granddaughter Road
Refuses to Come Into
Court.

NASHVILLE, April 2-Although argu-
ments will be finished today, Judge Lurton
will probably not give Judgment in the
Southern Pacific case till Monday.
When today's session opened Judge Hum
phrey continued his address for the Har-
riman interests. He read largely from Mr.,
Harriman's afidsvits, and said he would
leave the law to be discussed later by his
associates
There was no evidence, he claimed, to
show that the directors ever contemplated
turning over the Central Pacific to the
Union Pacific. and no discrimination had
been practiced against the Southern Pa
cifc.
He traced the development OF the Central
Pacific and said the plans Of putting the
property in better physical condition, as
inaugurated by Mr.. Huntington, had been
carried out.
Judge Humphrey said that the applica-
tion of earnings to the improvement OF
railroad properties, instead of paying divi-
dends to preferred stockholders had been
held by the supreme court of the United
States to be for the best interest OF all
the shareholders and that the complainant
thought the way to modeTnize railroad
was to issue securities.
Judge Humphrey said in response to
question by Judge Lurton that there could
be no competition between the Union and
Southern Pacific, and, therefore. there
could be no possible grounds for the appli-
cation for an injunction.
Union Pacific Not Before Court.
Judge Humphrey was followed by Mr.
Everts, who contended that the Union Pa
cihc was not before the court, and the
court, therefore, had no jurisdiction. He
insisted that a court Of equity could not
abridge the rights of a majority OF the
bondholders or divest them Of the manage
ment Of a corporation, and declared the
constitution Of Kentucky provided how tho
election Of directors should be held,
He then entered upon a technical and
legal defense Of the rights Of corporations
to purchase shares Of stock in other cor
porations, and in regard to withholding div
idends from the owners of the stock in the
Southern Pacific, said that in order to pay
them It would be necessary to borrow great
sums, and the result would be that the pub
lie would be compelled to pay higher
charges.
Lawrence Maxwell, who represents the
Union Pacific, followed Mr.. Everts, and said
that this was a suit in which in order to
obtain relief the complainant must show
that as a stockholder in the Southern Pa
cifc he has suffered or Is threatened with
some action on the part OF other stockhold-
ers Injurious to his interests.
Pleads for Hartman.
He continued: THE charges of moral
turpitude against the directors of the
Southern Pacific are dissipated by the fact
that the plans projected by Mr.. Huntington
are being carried out by the directors of
the Southern Pacific.
"The evidence here" he declared "is
that there has been no change in pro-rat-
ing and no effort OF the competing lines to
do business with the Union Pacific instead
of the Southern Pacific"
Mr. Maxwell was followed by Senator
Foraker for the complainant. He under
took at the outset to defend his clients
against any accusation of stock jobbing.
Mr. Lauterbach tried to avoid litigation
and make peace and neither Mr.. Keene nor
Mr.. Taylor had ever given authority for
the sale Of their stock. The most import
ant question involved after all, he claimed,
was that of jurisdiction. After investiga-
tion he believed the Union Pacific was not
a necessary party to be named in this suit
and to be brought into court. but that the
Union Pacific would come into court and
make defense IL the court would so permit.
contract or note, unless the Union Pacific
did see fit to come into court. 1t could not
be made to do so, Unless 1t did come into
court the suit would have to be dismissed
on account of the absence of a party to
| the case.
stockholders Are Company.
"If the Central or the Southern Pacific is
a stockholder OF the Union Pacific" he said,
at is in court when the Union Pacific is
there We have sued the Southern Pacific
and it is not the corporation, but the stock
| holders who are in court"
Senator Foraker was still speaking when
! court adjourned.
The afidavits OF James r. Keene and
Edward Lauterbach Nere introduced. Mr..
| Keene said he never authorized the sale
Of his Southern Pacific stock. Mr.. Lauter-
bachs affidavit, among other things, set
| forth how he had brought Keene and Har-
riman together and how he believed things
/ had been satisfactorily agreed upon; that
there was a disposition to have the ex-
penses of the Southern Pacific curtailed,
| but to this Mr.. Hartman would not agree,
| and that the suit Of Talbot ]. Taylor fol-