The Minneapolis journal., 1903-04-10

I'm the case Of the United States against
the Northern Securities company and Its
component corporations and capitalists,
Judge Thayer's decision for the plaintiff,
filed yesterday at st. Paul, is as follows:
In the Circuit Court Of the United States
for the District Of Minnesota Third
'Division.
United States Of America, complainant,
VS.. The Northern Securities Company,
The Northern Pacific Railway company,
James ]. Hill, William P. Clough. D.
Willis James, John S. Kennedy, j. Pier
pont Morgan, Robert Bacon, George F.
Baker and Daniel Lamont, defendants. !
Mr.. Philander G. Knox, attorney gen
|eral; 3D. T. Watson, special counsel; Mr..
James M. Beck and Mr.. w. A. Day. assist
ant attorneys general, and Mr.. John
M. Freeman, for the United States.
Mr.. George B. Young and Hon. John w.
Griggs for the Northern Securities COM
pany. - r..
Mr.. NJ. D. Grover for the Great North
ern Railway company. -
Mr.. G. w. Bum for, the Northern Pa
cif1c Railway company. 81 9: . q >s :.
Mr.. Francis Lynde Stetson and Mr. Da-
vid Wilcox for defendants, Morgan, Ba-
con and Lamont. ...
Before Caldwell, Sanborn, Thayer and
Van Devanter, circuit judges. !. go.
Thayer, circuit judge, stated the con-
clusions of the court: -. =,
- Definition of Case.
/ This Is a bill, exhibited by the United
States, to restrain. the violation of an acl
of congress. approved July 2, 1890 (26 St
209, Z. 647), entitled IAN act to protect
trade and commerce against unlawful re-
straints and monopolies," which Is com
monty called the Sherman antitrust act
The. case was heard before a circuit court
composed of the four circuit Judges of the
eighth circuit pusuant to the provisions
| Of q: recent act of congress, approved Feb
II. 1903. which requires such cases to be
heard before not less than three ofg.lhe
| circuit judges" of the circuit where the
suit is brought, when the attorney genera
| files with the clerk of the court, wherein
the case is pending a certificate that it is
one of general public Importance" Such
| a certificate has been filed, and, in ac-
cordance with the mandate of the statute
| the case has been given precedence over
others. and in every way expedited" j.,
+ From admissions made by the pleadings
| as we'll as from much oral testimony, we
reach the following conclusions as respects
matters of fact. .s; -. r.. .v...-
I Two Of. the defendants, namely, the
Northern Pacific, Railway company AND
the Great Northern Railway company, are
the owners respectively of lines of rail-
road which extend from the cities of "Du-
luth, St. Paul and Minneapolis. in the
state Of Minnesota, thence across the con-
tinent to Puget sound.
Competing, Parallel / Ines. " r:
These roads are, and in public esti!na-
ton have ever been, regarded as parallel
and competing lines. :. For some years at
least after they were built they competed
with each other actively for transcontinen-
tai and interstate traffic. In the spring
Of the year 1901 they united in purcEas-
ing about SO per cent Of the entire capital
stock Of the Chicago, Burlington & Quin-
cy Railway company, and became joint
sureties for the payment Of the bonds of
the last named company, whereby the
-" -'.f wnic:l were
to run twenty years and bear per: cent
interest per annum. The amount of stock
$50 acquired was Of a par value of. about
s107 900, 900, and as it was purchased at
the rate Of 5000 per share, The bonded in
debtedness of the two companies was thus
increased to the extent Of 100000, 600.
" Subsequent to the acquisition Of the
stock of the Burlington company, and in
the summer of the year 1901 certain
large and influential stockholders of the
Northern Pacific and Great Northern
companies, who had practical control of
the two roads, and who have been made
parties defendant to- the present bill, act
ing in concert with each other, conceived
the. design Of placing a very large major
ity of the stock Of both Of the last named
companies in the hands Of single owner
-. The Holding Corporation :
To this end these stockholders arranged
and agreed with each other to procure
and cause the formation Of a corporation
under the laws Of the state of. New
Jersey. which latter company when or
ganized, should buy all, or, at least, the
ofor. rf nf ho etc r1r of no Norf
Pacific and Great Northern companies,
The individuals who conceived and pro-
noted this plan agreed with each other
to exchange their respective holdings of
stock in the last named railroad COM
panies for the stock of the New Jersey
company, when the same should be- fully
organized, and to use their influence to
induce other stockholders in their respec-
tive companies to do likewise, to the end
that the New Jersey company might be
come the sole owner of the whole or at
least q major portion Of the stock of both
railroad companies. t.~~e ." :.
In accordance with this plan the de-
fendant. the Northern Securities company
thereafter termed the Securities company
was organized under the laws of the state
Of New Jersey Ion Nov. 13, 1901, with a
capital stock Of $400, 900. that sum
being the exact amount required to pur-
chase the total stock Of the two railroad
companies at the price, agreed. to be paid
therefor.
When the Securities company was or
ganized, it assented to and became a
party to the scheme that had been devised
by its promoters before it became a legal
entity. Very shortly after its organize
tion the Securities company acquired a,
large majority of all the stock of the
Northern Pacific company at the rate of
$115 per share, paying therefor in its
own stock at par I. !.
Exchanges of Stock.
At the same time it acquired about 3oO.-
600 shares Of the stock Of the Great
Northern company from those stockhold-
ers of that company who had. been in