The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-04-10
SHERMAN Law VIOLATED
WHEN TWO COMPANIES CONSPlRED
TO DESTROY COMPETITION.
New Jersey Charter Not Superior
to Federal Statutes or the
Laws of Other States.

ST. PAUL, Minn., April 9-The position
Of the United States government, In the
suit brought against the Northern Securt-
ties Company, the Northern Pacific and the
Great Northern Railways and individual
officials and directors of those companies,
was sustained In the decision handed down
in the United States Circuit Court OF APP
peals in this city to-day. The case was
originally brought in the United States Dis
trict Court here, but, under a special act
of Congress, was taken at once to the Court
of Appeals, which court was to expedite the
hearing and decision of the case in every
manner possible. The taking of testimony
in this city and In New York lasted for
several weeks. and the arguments in St
Louis, before Circuit Judges Caldwell, San
born. Thayer and Vandevanter. took several
days The decision of the court writ
ten by Judge Thayer and was filed in this
city where the original action was in
stituted. An appeal to the United States
Supreme Court will be taken Immediately.
All four judges concurred in the conclusion
OF the court, which was stated by Circuit
Judge Thayer as follows:
This is a bill. exhibited by the United
States, 10 restrain the violation Of an act
of Congress approved July 2. 1890 (26 CT.
zoo c. 647 Page, entitled An act To pro-
tect trade and commerce against unlawful
restraints and monopolies.' which is COM
monty termed the Sherman antitrust act.
The case was heard before a Circuit Court
composed of the four circuit judges of the
Eighth circuit. pursuant to the provisions
of a recent act of Congress approved Feb.
IL, 1902, vi:ich requires such cases to be
heard before not less than three OF the
circuit judges of the circuit where the suit
is brought. when the attorney general files
with the clerk of the court. wherein the
case is pending, a certificate that it is one of
general public Importance. Such certifi-
cate has been filed. and in accordance with
the mandate of the statute the case has
been given precedence over others and in
every way expedited
MATTERS OF FACT.
From admissions made by the plead
ings. as we'll as from much oral testimony,
we reach the following conclusions as re-
spects matters of fact: Two of the de-
PENDANTS, namely, the Northern Pacific
Railway Company and the Great Northern
Railway Company, are the owners re-
spectively of lines of railroad which extend
from the cities of Duluth, st. Paul and
Minneapolis. in the State of Minnesota,
thence across the continent to Puget sound.
These roads are, and in public estimation
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 transcontinental
and interstate traffic. In the spring of the
year of 1901 they united In purchasing about
9S per cent. of the entire capital stock of
the Chicago. Burlington & Quincy Railway
Company. and became joint sureties for the
payment of bonds OF the last-named COM
pany whereby the purchase was accom-
plished. which were to run twenty years
and bear per cent. interest per annum
The amount of stock so acquired was of
the par value OF about s1O7. ,OOO and as it
was purchased at the rate OF 500 per share.
the bonded Indebtedness of the two COM
panies was thus increased to the extent of
500 900. Subsequent to the ACQUISITION
OF the stock OF the Burlington Comnanv
and in the summer OF the year 1901 GER
tain 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 10 the present bill. acting In
concert with each other, conceived the do
sign OF placing a very large majority of
the stock OF both of the last-named COM
panies in the hands of a single owner. To
this end these stockholders arranged and
agreed with each other 10 procure and
cause the formation OF a corporation I'M
der the laws OF the State of New Jersey.
which latter company. when organized.
should buy all or at least the greater part
Of the stock Of the two railway companies.
THE SECURITIES COMPANY.
"The individuals who conceived and pro-
rnoted this plan agreed with each other to
exchange their respective holdings of stock
I'm the last named railroad companies for
the stock OF the New Jersey company when
the same should be fully organized. and 10
use their influence TO induce other stock
holders in their respective companies to do
likewise TO the end that the New Jersev
company might become the sole owner of
the whole or at least a major portion Of
the stock OF both railroad companies. In
accordance with this plan the defendant
the Northern Securities Company fhere-
after termed the Securities Company was
organized under the laws Of New Jersey on
Nov g. 1901. with a capital stock OF s,OO :
0Oo,0o0. that sum being the exact amount
required to purchase the total stock of the
two railroad companies at the price agreed
TO be paid therefor. When this companv
was organized IL assented TO and became
q party TO the scheme that had been de-
vised by it's promoters before IL became
. legal entity.
Very shortly after its organization the
securities Company acquired a large ma