The Birmingham age-herald., 1903-04-07
Judge LurtOn Decides Against
 the KGene Interest
DEFENDANTS WILL APPEAL
Pending the Appeal the Directors Of Southern Pacific Will Elect Chair man Awaiting a call-An ln-
 terestina Opinion.

Cincinnati, April e.--At 1 D. m. today Judge Lurton concluded the reading of his opinion in the suit making appllea- ton to restrain the Union Pacific from voting it's 900,000 shares In the Southern Pacific election that has been set for 1 April 8 and for other relief. The de- eision was a refusal to grant the injune- ton and to afford the relief asked The opinion. which was quite lengthy, was against the contention Of the eomplain- ants that the Union Pacific was a neees- 1 sary or actual party to the suit, even though President Hartman of the Union Pacific had made an affidavit in the case. Being mere witness in the case did not amount to an appearance by the Union Pacific a party in the suit.
 As to the averment that the Union Pa cihc was expending the receipts of the Southern Pacific in betterments on the Central Pacific with @ view to the ultl- mate purchase of that road, the court held that all this was specifically denied by the defendants. and that even if trua 1t could not be sustained except on showing that the action was ultra virus. On the whole case the court held that the bill be dismissed.
 Case Will Be Appealed.
 Senator Foraker. who represented the eomplainants, minority stockholders of the Southern Pacific, gave notice of ap- peal to the United States Court of Ap- peals and asked that, pending the hear Ing of this appeal the election of direc- tors of the Southern Pacific set for April be stayed. It was agreed that the stockholders may meet as arranged and elect chairman and then adjourn until called by the chairman after the appeal has been disposed of by the Court of Ap- peals.
 After reciting the facts in a history of the contention, the affidavits, arguments an1 claims in support of both the bill or the application for an injunction, and the l answer, Judge Lurton held:
 l. The first and dominating question Is whether the Union Pacific Railroad com pany Is an indispensable party without 1 which no decree can be made in respect of It's right to vote the shares of South ern Pacific stock at the approaching stockholders meeting for the election of directors of the Southern Pacific com pany. 5.6.la
 A Right Inherent.
 Unless otherwise provided by the or- ganic law of the corporation the right of stockholder to vote upon his stock at all meetings of shareholders, Is a right inherent in the ownership of the shares and as such a property right. If the right of the 9O0.0OO shares benehcially owned by the Union Pacific Railroad company to vote be denied, It must be either upon the ground that the shares have been illegally issued or that the company Is incapable in law of holding such shares, or that some public policy 10 u1aan ha to exercise the ordinary incident of such ownership by voting them in stockholders meetings, or that the property rights of the minority are to be thereby so serious ly put in jeopardy as to justify a court of equity in practically turning the own CT and holder of such shares out of con- trol and management of the defendant corporation, and placing in control the minority in shareholdng in interest. To justify such result ] should have to hold and adjudge either that the Union Pacific Railroad company was incapable of legally acquiring and holding shares in the Southern Pacific company, or that if competent to own and hold such shares it ought not to be suffered to exercise the right of participating in election of directors as such participation may re- | suit in placing the Union Pacific com pany in a position where it would be capable of controlling and dominating the
 
 Would Involve Inquiry.
 Such a conclusion would involve an inquiry and determination of the com petitive relations of these companies to each other in order that they might he brought within the sweep of the legal principles which forbid the unlfication of such properties. or l should have to find that one or both companies were subject to some positive statutory disability which would forbid the one to hold the stock of the other, or any unifcation of opera ton through stock ownership traffic or community of interest agreement, which would substantially eliminate the motive for competition.
 The case of Minnesota vs. Northern Securities company has an important bearing upon this subject.
 For this reason and without expressing any opinion as to the power of a court of equity to interfere with the privilege os a stockholder to vote his shares he pleases and for whom he pleases, if he be lawfully competent to own and hold the shares at all or any opinion upon any of the most interesting questions. which arise properly only in a cause to which the Union Pacific is that party, l must decline to grant any injunction restrain ing the voting of the Union Pacific shares at the approaching election of directors.
 The complainants may at any time here | after make another application upon ob- tainng evidence of purpose to deal with the Central Pacific stock or lease as they profess to apprehend.
 A motion to appeal was then sustained, and the Southern Pacific election post poned pending the appeal.
 Decided on Technlcalty.
 New York, April 6.-Edward Lauter- bach. counsel for Taylor & Co. in the Southern Pacific injunction proceedings, today said that he had been notified that the decision not to make the injunction permanent, was based upon a technical ity Judge Lurton holding that the Union Pacific was an indispensable party in the case, and would have to be repre- sented in court before injunction could be granted 1t. He explained that the ruling against thetaointaointaointaoi ruling in the Northern Securities company had determined the action against . stockholder Gin this case, the Union Pact