Washington standard. [volume] (Olympia, Wash. Territory) 1860-1921, 1903-04-17
THE MERGER DECISION.
A Synopsis Of the Most Important Finding of
Modern Times,

A Synopsis Of the Most Important Finding of
Modern Times.
The following embraces a brief refer
ence to the points decided by the U. S.
Circuit Court at St. Paul, in which it
is held that the Northern Securities
Co. exists in violation Of the Sherman
antitrust law:
In the Northern Securities company
merger case a decision in favor of the
United States was delivered by Judge
Sanborn in the United States Circuit
Court on the 1lth. The court held that
the combination of Great Northern
and Northern Pacific stocks was in re-
straint of trade, and enjoins the North
ern Securities company from voting
the stock OF either company and the
officials of the roads from allowing the
Northern Securities officials to vote
their stock or to pay dividends to the
Securities company. The Northern
Pacific and Great Northern stocks can
be returned to the previous holders.
Judge Thayer who wrote the opinion
stating the conclusion of the court,
recounted the history of the merger.
The amount OF stock acquired was one
hundred and seventy millions at par
value, which was purchased at 5000
per share, which increased the bonded
Indebtedness of the new company to
S200,000,O0O. This stock included all
that OF the Burlington route purchased
10y the Northern Securities company
with a capital stock of 100000, 600.
At present the Securities company
holds Sc per cent. of Northern Pacific
stock and 76 per cent. OF the Great
Northern. This DESTROYED every mo-
tive OF competition.
1--WE must conclude" runs the deci-
sion, that those who conceived and
executed the aforesaid plan intended
among other things to accomplish this
object"
The decision then interprets the
Sherman antitrust act under which
the suit was brought as making illegal
every contract of combination in the
form OF trust or otherwise, or con-
spiracy in restraint of trade or COM
merce among the several States or
with foreign nations. Such a combi-
nation as railroad mergers, was fore.
seen, hence the use of the word "other-
wise"
On this word hangs the whole deci-
sion of the court. The decision says:
Competition could not be more
effectuslly restrained than it now is by
this combination. Even if the two
roads we're operated under one charter
and for this reason the Northern Sc
curities company comes under the jur-
isdiction of the Sherman antitrust
law, the State of New Jersey issued
a charter with the understanding that
the Northern Securities company
should not set at defiance the laws Of
Congress"
The suggestion that a decision
against the Securities company would
tend to interfere with the constitu.
tional rights of buying and selling i.
waived by the judges as being worthy
of little consideration. The conten-
ton that the Securities company can
not come under the jurisdiction of the
antitrust law for the reason that it
held a majority of stock in the two
railways before the suit was filed, is
characterized as absurd. The Judges
will neither affirm nor deny that a
combination in the broad sense is bene-
fetal to the public rather than HARM
full, that the motives inspiring the
combination were laudable and I'M
selfish. that the organizers entered the
combination was the initial step of
stupendous designs which consum.
mated would be inestimable value to
communities. These are characterized
as questions of public policy, which
Congress must determine. The sole
question for the court was whether or
not the antitrust act had been VIC.
lated and the court holds in the affirm
alive.
BY the decision, the greatest railway
merger in the world is completely
knocked out. The decision is the
most sweeping ever aimed at comb.
nation, or so-called trust. 1t is unani-
mously agreed to by Judges Sanborn,
Caldwell, Thayer and Vandeventer.
Thayer wrote the decree.