The daily morning journal and courier., 1903-12-15
KNOX ATTACKS THE MERGER
GOVERNMENTS SIDE IN NORTH
 ERN SECURITIES CASE.

@
 The Latter Held to be a combination
 tn Restraint of Commerce Among she
 States.
 Washington, Dec. H.-Immediately after disposing of its routine Monday morning business the Supreme court of the United States to-day began hearing arguments in the case of the Northern Securities company, the Great Northern Railroad company, the Northern Pacific company, James J. Hill, J. Pierpont Morgan, Daniel $. Lamont, and others, vs. the United States, coming to this court on appeal from the decision Of the circuit court for the District of Min nesota. That decision was to the ef- feet that the purchase of the greater share of the stock of the two railroad companies constituted a merger, and was, contrary to the Sherman Anti Trust law. The case involves the com munity- of interest principle. .4a
 Tn beginning his argument for the government Attorney General Knox said that the case was one of grave concern, based upon it's conviction that a nlisehievous of the law has been at tempted, as well as upon it's especial in terest in and relations to one of the properties affected" e 2
 Tn order that the court might under stand the reasons for this concern he reviewed the principal facts connected with the organization and subsequent history of the Northern Pacific com pany, its relations to the Great North ern railroad and other facts out of which the question in this case arise, but without extended comment. His statement of facts in this connection was as follows:
 Ftrst-That the Northern Pacific rail- road was built under the authority of the United States and in the main with capital furnished by the United States, and that the United States Intended and attached the condition of it's con- tribution that the railroad should be a great independent national highway and specified that the object of it's con- 5 struction was to promote the public interests.''
 Second-That by different devices employed during the past ten years, the defendants, or some of them, have en- deavored to destroy the independence of the Northern Pacific company and bring it under the domination of the Great Northern company.
 Third-That the Northern Securities company is an instrumentality devised by defendants to acquire, hold and ex- ercise control over these two parallel and competing lines of railroads, to de- stroy competition between them, to create monopoly of transportation in the section served by them and to de- feat the condition attached by the United States to the franchise and land grants of the Northern Pacific company.
 Upon this statement the attorney gen. era1 based the following propositions:
 list. That the arrangement effected by the defendants is a combination in re- straint of interstate commerce and is illegal under the first section of the act of July ?, 1890 (the Sherman antitrust act).
 2d. That it constitutes monopoly un- der the second section Of that act.
 3d. That the court has the power to prevent. restrain or otherwise prohibit it.
 Further reviewing the history of the Northern Pacific Railroad company, he said it was chartered under the provi- sions of an act of congress approved July ?, 1864. The corporation was au- thorized to construct a railroad which by the eleventh section of the act shall be post route and military road, sub- ject to the use of the United States for postal military, naval and all other government services" &
 He remarked in passing that ''when the United States created the Northern Pacific company and authorized 1t to construct railroad, and for that pur- pose endowed it with 4S,0O0,OOo acres of the public domain, it was Ito secure to Z the government at all times the use and benefits of the same for postal, military and other purposes"
 In other words. said MT. Knox, con- gress gave the peoples land to the Northern Pacific Railroad company, and to no other company, and the Unit ed States is directly interested in seeing to it that the Northern Pacific company shall maintain an undiminished ability to render the service which was the con- sideration of the grant, unaffected by the domination of other interests.
 The attorney general then gave de- tailed account of the attempt to secure control of the Northern Pacific road, as shown in the case of Pearsall vs. Great Northern road. MT. Morgan. he said, knew of this attempt, sympathized with it and assured Mir. Hill, if he failed, they could work the two roads in har- mony.
 Continuing, the attorney general said:
 Let us see what steps were taken to get the Northern Pacific property in such situation as would enable Mir. Morgan to make his assurance to MT. Hill. A reorganization of the road was effected, and a new capital organized under the laws of Wisconsin with pow CT to do so, took over the property and franchises of the Northern Pacific com- pany.
 By the reorganization agreement J. F. Morgan & Co. were made managers of the reorganization. What is known as harmony now prevailed between the two roads and continued as such until 1901, when the two roads made a joint purchase of the Chicago, Burlington and Quincy railroad. This partnership in the ownership of the Burlington was almost immediately followed by the x,,f.sat, rvnr,rAp,,any1t ,a,,, =