The San Francisco call., 1903-12-15
CASE OF THE GOVERNMENT.
Brief Prepared by Attorney General
Knox Filed With Court.

WASHINGTON, Dec. 1.-THE brief
of the Government in the case of the
Northern Securities Company and 9TH
ers VS.. the United States, on appeal
from the decision of the Circuit Court
of the United States for the district of
Minnesota, was filed in the United
States Supreme Court to-day. The
document was prepared by Attorney
General Knox and Assistant Attorney
General Day, and covers 1S0 printed
pages.
After stating that the bill in the case
was originally brought by the Govern
ment to restrain the violation of the
antitrust law by the Securities Com
pany in the consolidation of the North
ern Pacific and the Great Northern
railroads, and that the decision of the
court below was favorable to the con-
tentions of the United States, the brief
enters into the following specifications
as to the reasons for the action:
1. The lines of railway operated by
the defendants, the Great Northern
Railway Company and the Northern
Pacific Railway Company, are parallel
and competing.
= That TIE GOlllDlLdNlOu lS III re-
straint of interstate commerce and
a monopoly.
The concluding paragraph of Judge
Thayer's opinion in the Circuit Court
is quoted as summing up the argument
bearing upon the facts of the case as
follows:
AT the present time the Securities
Company is the owner of about 9S. per
cent Of all the stock of the Northern
Pacific Company and the owner of
about 20 per cent Of all the stock of the
Great Northern Company. The scheme
which was thus devised and consum-
mated led inevitably to the following
results:
''First-It placed the control of the
two roads in the hands of a single per-
son, to wit, the Securities Company, by
virtue Of its ownership of a large ma
jority of the stock of both companies.
''Second-It destroyed every motive
for competition between two roads en-
aged in interstate traffic, which were
natural competitors for business, by
pooling the earnings of the two roads
for the common benefit of the stock
holders of both companies; and, accord
ing to the familiar rule that every one
is presumed to intend what is the nee
essary consequence of his own acts,
when done willfully and deliberately
NE must conclude that those who con-
ceived and executed the plan aforesaid
intended, among other things, to ac-
complish those objects"
Tho Attorney Generals own summary
of the results is as follows:
Al.
mentioned exchanges Of Great North
ern and Northern Pacific stock for the
stock Of the Securities, the latter COM
pany on December II, 1901, had ac-
auired and paid for $4,000 shares Gin
round figures) Of the Great Northern
stock. the total capital stock of that
company consisting of 1,25O,000 shares.
of which 1,220,o had been issued, and
by January 1, 1892, the Securities Com
pany he'd acquired virtually all of the
common stock of the Northern Pacific
(the preferred stock was retired on that
date, the resolution to retire it having
been passed in the preceding Novem-
Der) its answer to the bill admitting
that it held 100000 Northern Pacific
shares out of a total of 1850. 600.
The final result of the transactions
was that one and the same set of men,
Hill and Morgan and their associates
being the ruling spirits among them,
acting together under a charter agree
ment and through the agency of a
corporate organization, became invest
ed with absolute power of control over
two parallel and competing systems of
| interstate railway. In place of the
two distinct sets of stockholders with
rival and competing interests, namely,
the stockholders of the Great Northern
and Northern Pacific, there has been
substituted by means of the inter-
change Of stocks described. the one set
of stockholders, with one common and
non-competitive interest, namely, the
stockholders of the Securities Company.
Thus, identically the same persons who
controlled the Great Northern and
Northern Pacific before the Securities
Company came into possession of a
majority Of their shares. control them
now, only now these persons have a
common interest-"communit of inter-
est''-in the earnings of both roads,
while formerly the interests of two
sets Of persons-the two sets Of stock