The Tomahawk., 1903-08-13
MINNESOTA
LOSES ITS SUIT
Judge Lochren Decides That North
ern Securities Company Is
Legal Organization.

Vhs Holding of the Stock Does Not Con-
solidate the Great Northern and
Northern Pacific Railroads.
Text of the Decision.
''This cause came on for final hearing
at st. Paul June S, 1908, upon the bill,
and testmony taken and on 1H
cognizance and that this court has right
full jurisdiction Of the same was conceded
and upon full Consideration the following
facts appear and are exhibited:
Securities Company.
THE attempt in the interest Of the
Union Pacific company to purchase q ma
cifc company and obtain. the control of
that company, and through it of the Bur-
lington system. alarmed the managers
company, and led them to consider the
feasibility of forming holding company
which should purchase or secure IN ex-
change for its own stock more than a ma
jority of the stock of the Northern Pa
ciflc company, and hold the same secure
against any raid in the future VI Elm. IN the In
''Mr. Hill and the stockholders referred
to of the Great Northern company. were
interest Of the Union Pacific, company to
obtain control of the Northern Pacific
and through it of the Burlington system.
rousy y Affect hez he OF
Great Northern railroad, and the country
traversed by it and by the Northern Pa
tabiishing holding company to pur..
chase and hold majority Of the stock Of
the Northern Pacific company they, joined
company and placing therein their own
stock in the Great Northern company and
permitting all other stockholders Of the
y1o0 ictot oh
iikew w and thus accomplish their pur-
pose above stated of giving permanency
to the management and policy OF the
Great Northern company.
Not Done by Companies.
'"fhe Incorporation of the Northern Sc
curities company under the general laws
Of New Jersey and with capital 90 OF
Neither the Great Northern company nor
the Northern Pacific company, by any
act OF it's direct to- or IA any F;n
subsequent action of the Northern Sc
curities company; but Mr.. Morgan. Mr..
Hill and other stockholders of the North
company, were individually the promoters
who caused and procured the ncorpora-
for the purposes above stated.
THE Northern Securities company
when formed offered and agreed to pur-.
par (sioo TO- per p share) any stock Of the
Northern Pacific company at the price OF
Sis per share and any stock Of the Great
Northern company at the price, price Of $50 1So
Stock of said two railroads were at such
rates and 50 paid for, purchased ase II from ON
of said two railroad companies by said
Northern Securities company.
and is sns sod to
& Co. al! the Northern Pacific company
stock which they had purchased as afore-
to ors than ans and
said J. p. Morgan & Co. at the same
time sold all the same stock to the North
consideration therefor directly to Mr.:
Hartman and his associates; part Of
such consideration being something more
than, s2,ooo,0oo of the stock of said
Northern Securities company. That pur-
chase was completed on Nov. 10. 1901.
Conclusions OF Law.
"First-It is obvious from the fore
ging facts that the Northern. Securities
company was Incorporated with the pur-
pose and intent on the part of it's pro-
moters that it should acquire by purchase,
own and control a. considerable majority
of all the stock of the Northern Pacific
company, and thus secure that company
upon it's stock which might place its man
agement and the resulting control of the
Burlington system in the power S% &c, Of fan any y
might be hostile to the development and
property of the Northern Pacific and
board board ter terminals and, and Of the region Of
country traversed by their railroad sys-
tens:
Morgan and his associates who acted
with him in this matter. including Mr..
Hill and other large stockholders Of the
large amounts of stock in the Northern
Pacific company and were ,apprehensive
that any hostile control of the Northern
its interests to a rival would be dsas-
trous to the development and prosperity
Of the Great Northern company: And at
curities company was formed and incor-
porated. by 1neans Of the large holdings
q Northern Pacific company stock by
him and by the then purchase by J; P.
Morgan & 70. of the Harrinla's holding
ferred to the Northern Securities COM
pany' large and controlling majority of
the stock Of the Northern Paeifie com m.
(as was beiieved) the purpose of securing
that stock against hostile raids in the
State Antitrust Law.
20 One question in this cause is
whether tie acquisition by the Northern
Securities company, in the manner above
of both the Great Northern and Northern
Pacific companies, which own and operate
parallel AID competing railroads across
of such stuck is violation of the Mime
sofa antitrust law-Laws of Minnesota
1899. oh. s59-which provides, as above
stated, that: ANY contract, agreement.
arrangement, or conspiracy, or any COM
bination II, the form of a trust or other
wise hereafter entered into which is in
restraint Of trade or commerce within
this state is hereby prohibited
and declared to be unlawful.
Language in the act extending these
provisions to interstate commerce is here
omitted and disregarded and the act con-
sidered valid as to trade and commerce
within the state, that being a proper sub
ject for state legislation, though carried
on by the same instrumentalities used in
interstate commerce. The language just
quoted Is evidently taken from the act
Of congress Of July 2, 1890 (26 Stat 209;
c. 647). known as the Sherman antitrust
act, which has received consideration by
the supreme court Of the United States
In several cases.
Differs With Other Court.
THAT my judgment, after most care
full consideration of the facts and the
law applicable thereto. as construed by