The Minneapolis journal., 1903-04-10

purchase the greater part of its stock. 1t
was the method pursued by the Northern
Pacific and GreatS Northern companies to
obtain eontrolsefs the Chicago. Burlington
& Quincy railroad; and so long as direct
ors are: chosencbys stockholders, the latter
will necessarily dominate the former, and
sin a real sense determine all important
corporate acts. The fact that the owner.
ship Of a majority Of the capital stock of
corporation gives one the mastery and
control of the, corporation was distinctly
recognized and declared in Pearsall VS..
Great Northern Railway, ISL U.s*s s. 646,
671. The same fact has been recognized
and declared by other Scourts-Pennsyl-
vania Railroad Company VS.. Common
wealth, Z Att. (Pa.) 1868, 81; Farmers
Loan and Trust Company vs.. New York e.
Northern Railway Company, 1870. N. Y,
41O, 425; Peoples ex rel. VS.. Chicago Gas
Trust Company, 1870, III, 26S. N. e. Rep,
798, S02. %, In opposition to this view coun-
sci cite Pullman Car Company VS.. Mis-
souri, Pacific Company, 113 (Mo), 387, 596,
but in that case the meaning Of the word
controlled, as used in a private contract,
was the point under consideration. and
what was said on the subject cannot be
held applicable to cases arising under the
antitrust act, when the point involved is
whether the ownership of all the stock Of
the two competing and parallel roads vests
]. the owner thereof with the power to sup
press competition between such roads.
We entertain mo doubt that it does. In
deed, we regard suppression Of competi-
tion, and to- that extent a restraint of
commerce, as the. natural and"inevitable
result Of such ownership. i I'D ..,..
49, Illegal Object Accomplished.
What has been done thru the organiza-
tion of the Securities company accom-
plishes the object, which congress has de-
nounced as Illegal, more efectually per-
haps than such combination as is last
supposed. 2
!. That is to say, by what has been done
the power has been acquired (and pro-
vision made for maintaining iD to sup
press competition between two interstate
carriers who own and operate competing
and parallel lines Of railroad. .,@
Competition, we think would not be
more effectually restrained than it now is
under and by force of the existing ar
rangement. il. the two railroad companies
were considered under a single charter.
It is manifest, therefore, that the New,
Jersey charter is about the only shield
which the defendants can 1nterpose be-
tween themselves and the law.
The reasoning which led to the acquisi-
ton Of that charter would seem to have
been thatwhile as individuals the prornot-
ers could not, by agreement between
themselves, place the majority of the
stock of the two competing and parallel
railroads in the hands of a single person. or
a few persons, giving him or them the
power to operate the roads in harmony
and stihe competition, yet that the same
persons might create purely fictitious
person termed corporation. which could
neither think nor act except as they d1-
rected, and by placing the same stock in
the name Of such artificial being, accom-
plish the same purpose
The manifest unreasonableness OF such
a proposition and the grave consequences
sure to follow from its approval, compel
us to assume that 1t must be. unsound,
especially when we reflect that the law as
administered by courts of equity, looks al
ways at the substance Of things-at the
object accomplished. whether it be law
full or unlawfu1-ratheI than uron the par
ticular devices or means by which 1T has
been accomplished.
s-ate Charters and Federal Law.
SO far as the New Jersey charter is
concerned, the 4ucs stion. broadly stated,
which the court has to determine is
whetherGa charter granted by state can
be used to defeat the will of the national
legislature as expressed in a law relating
to Interstate trade and commerce over
which congress has absolute control.
Presumptively, at least, no charter
granted by "a state is intended by the
staIe to have that effect or to be used
fer such a purpose: and in the present
it is clear that the state of New
Jersey did not intend to grant charter
II. der cover of which an object denounced
byz congress as Unlawful namely, COM
biration comforting the power to restrain
Interstate commerce. might be formed
and maintained because the enabling act
under which the Securities company was
organixe,i. expressly sclares that three
Ill h6r ooIx