The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1903-08-07

Northern Securities company, popu-
larly called the merger" does not
violate the antitrust laws OF Mime
sofa, nor of the United States.
This case is known as the states
case" because it was an action begun
by the state attorney general on be-
half of the state.
Judge Lochren's decision is at vari-
ance with that of the United States
circuit court of appeals, which held
that the merger was an illegal COM
bination and which sustained Attor-
ney General Knox and the govern
ment's attorneys.
In brief, Judge Lochren holds that
the Northern Securities company is a
holding" company and there is moth
ing to show that it is in restraint of
trade as the state laws define re-
Straint.
Discusses the Merits.
Judge Lochren goes into the merits
of the case and in referring to the
governments case at st. Louis he
must reject the doctrine advanced in
can be held to have committed or to
be purposing to commit highly penal
crime merely because it can be shown
that his pecuniary interest can be
thereby advanced"
Judge Lochren holds that the North
ern Securities company Is not an OPP
Grating company and does not manage
the Northern Pacific and Great North
ern railroads. 1t is not in possession
of majority of the stock of the two
roads and therefore physically unable
to control them.
Individual ownership of stock in
parallel railroads, says the court, Is
not in violation of the law. He dis
tinguished the famous Pearsall case,
where the Great Northern as a COM
pany sought to purchase half the cap
ital stock of the Northern Pacific. This
was held illegal by the court, but as
the Securities company is an indi-
vidual, it is not unlawful for it to hold
stock in both companies.
History of the Company.
The court deals with the history of
the company, tells of the efforts of the
Hartman interests to secure control
of the Northern Pacific at the time the
Burlington was absorbed and refers to
the triumph of Morgan and Hill over
the opposition by forcing the retire
ment of the Northern Pacific's pre-
ferred stock.
The action just decided is one At
torney General Douglas instituted
shortly after the conference of gov
errors at Helena, Jan. 1, 1902. The
supreme court of the United States de-
MED the petition that it assume orig
inal jurisdiction, and the action was
resumed in the state courts, to be
transferred to the federal court and
broughtsto trial in June of this year
after numerous delays.-Minneapoli
Times, Aug. 2.
The Decision.
This cause came on for final hearing
at st. Paul June 5, 1908. upon the BILL
That the cause is one of equitable
cognizance and that this court has right
full Jurisdiction of the same was conceded
by counsel. The cause was fully argued
and upon full consideration the following
facts appear and are exhibited:
Burlington Purchase.
The purchase of the Burlington system
by the Great Northern and Northern Pa
c1flc, which was completed about April l.
1901, led the managers of the Union Pa
cific company to fear a diversion of traf-
fic from the railway of the Union Pacific
to the railways OF the two purchasing
representing the Union Pacific company,
applied to James j. Hill and j. Pierpont
Morgan, who respectively represented the
Great Northern and Northern Pacific
the Union Pacific company to join and
share with them in the purchase of the
Burlington system; but his application
was declined.
"Thereupon the said Hartman and
others acting in the interest of the Union
Pacific company began rapidly and quiet
ly to purchase the. stock of the Northern
Pacific company. intending thus to ac-
quire majority of that stock and the
control of that company, with it's half
interest in the Burlington system.
THE common stock of the Northern
Pacific company was $50. 000, 900, and it
had issued, and had outstanding pre-
ferred stock to the amount of SIS, 900, 600,
which had the same voting power as the
common stock, but which the company
by the action of it's directors might pay
off at par, and thus retire on the first
day of January, 1901, or on the first day
of any succeeding year During the
month of April and first week in May,
1901, the said Hartman and others act
ing with him in the interest of the Union
Pacific company purchased and held a
little more than $37, 000, 900 of the COM
mon stock, and a little more than SAL
900 900 of the preferred stock of the
Northern Pacific company, being more
than $7S,000,000 in ALL and more than a
majority of the aggregate of the COM
mon and preferred stock of that COM
pany.
But in the first week of May, 1901, ].
P. Morgan & Co.. becoming apprehensive
purchased s15.000.000 of the common
stock of the Northern Pacific company,
which with their previous holding of that
stock and those of Mr.. Hill and other
stockholders of the Northern Pacific COM
Morgan, gave the latter the control of
more than s41. 000,0 900 of such common
stock; being more than a majority of that
stock. AS Ii was known that Mr.. Morgan
and his associates would insist upon the
payment and retirement of the preferred
stock on Jan. 1. 1902, and that tho board
of directors of the Northern Pacific COM
pany would take action to that end. Mr.
Hartman and his associates abandoned
their attempt to obtain the control of
that company.
Securities Company.
1.-The attempt in the interest of the
Union Pacific company to purchase ma
iority of the stock of the Northern Pa
cific company and obtain the control of
that company, and through it of the Bur-
lington system, alarmed the managers
and stockholders of the Northern Pacific
company. and led them to consider the
af,.er hold