The sun. [volume] (New York [N.Y.]) 1833-1916, 1904-09-04
NORTHERN SECURITIES'RE
ANSWER FILED IN HARTMAN
SUIT FOR INJUNCTION.
Defendant Company Says 1t Owns Northern
Pacific Stock Outright and Not rs
Custodian, SO Cannot Restore what
Plaintiffs Put In-May Drop Appeal.

Custodian, SO Cannot Restore what
Plaintiffs Put In-May Drop Appeal
TRENTON. N. j., Sept. 3.-The Northern
Securities Company. through it's president
James j Hill filed it's answer in the United
States Circuit Court to-day to the second
amended bill of complaint Of Edward II.
Hartman, Winslow s. Pierce and the Oregon
Short Line Railroad Company TO enjoin
the proposed plan for the distribution of
the Northern Securities Company's assets.
It Ia the first answer Of the company to any
Of the proceedings. which had preliminary
hearing before Judge Bradford without
the for,nality of an answer.
The filing of the answer after the taking
Of an appeal from Judge Bradford's prelimi-
nary injunction to the Circuit Court OF APP
peals il interpreted here AZ indicating a
determination to let the case go to final
hearing before Judge Bradford
The answer recites that In November,
1901, the Northern Pacific Railway had a
capital stock of $i65 600 900, of which SIS ,OOO,
0OO ws= preferred. 1t denies that any part
OF the preferred stock was or could have been
converted into common stock, as alleged
IN the bill but asserts that on Jan. 1, 1902,
the preferred stock was paid of at par in
cash and retired
Since that date it is declared all the
preferred stock has ceased to exist and is
not represented by any form Of stock of
the Northern Securities Company. To
raise the money to retire the preferred
stock the Northern Pacific sold at par for
cash to the holders Of the $50 900 900 COM
mon stock bonds amounting to SIS, 600 900
par value, convertible into new common
stock Of like amount at par. These bonds,
prior to Jan. /, 1902, were actually con-
verified into new common stock of the North
ern Pacific Railway Company, 80 that since
Jan. I. 1902. the outstanding stock Of the
Northern Pacific Railway Company has
consisted Of shares amounting to Sl55 .OOO,-
900, par value. The authorized capital
stock Of the Great Northern Railway con-
sists Of shares amounting to s125, o0o. 900,
Of which about 1923 600, 900 are outstand-
ing
The defendant company denies that 1t
has ever agreed to acquire or to hold any
share Of railway stock, or anv other prop
or tn issue in exchange therefor any GER
tiicate Of its own stock 1t is asserted
that Hartman and Pierce had full knowl-
edge of the purposes for which the North
ern Securities Company was organized
and Of the fact that majority Of the CAPT.
tai stock OF each Of the other railway COM
panies had or might come into the owner
ship of the defendant for its corporate
purposes.
The answer further AYERS that a very
large majority OF it's stock is held by persons
not concerned in promoting It's organi-
zation. and who never have had any knowl-
edge Of the purposes Of the promoters,
save as they appear upon the face OF their
certificates. 1t denies that any person ever
knew, or had reason for supposing, that
or would be deposited with the Northern
Securities Company or held by 1t as deposit
tory or custodian. After narrating the
details Of the acquisition Of the Northern
Pacific stock, the answer continues:
The acquisition by this defendant OF the
preferred and common stocks Of the Northern
Pacific Railway Company was absolute and
unconditional, and was intended 80 to be both
by Hartman and Pierce and this defendant.
tiorrom Hartman and Pierce Of the NortSeTn
RsSS st29k Il has 6 been ,bs end be-
IN Oregon Short Line, for which said plain |
tits hold the same in their personal names |
There has never been any understanding |
Or ,r agreement, express or implied between
or between this defendant and Hartman and
as 0 should be hed retained
b managed or voted while this defendant
to old 1t. |
The answer denies that any part of the |
Ise, 491 900 of Northern Securities stock is- |
sued to Hartman and Pierce and pledged |
an Issue OF bonds Of the Oregon Short Line |
. available for tender. return or restora- |
ion under the conditions offered by the |
bill OF complaint
The answer denies that the effect Of the
II Minnesota, which was affirmed by the |
United States Supreme Court, was to de- |
errnine or establish that the Northern Sc |
,urities Company has acquired and now |
holds the stocks Of the railway companies |
absolute owner. 1t denies that the owner
hip Of suoh stocks by the defendant was
n any way called into question BY the |
lecree. Tho answer goes on:
I'm Pacific Railroad Company. 70 the amount
y the market Of, from individuals, this de-
endant has no knowledge or information |
Of T. saR ss Ct al The that
,oldtngs Of stock. notably among all its
the oxne,ESship Of the entire
Sodsis al Of tSsm prssumapiy
'SSsjeot to the e, ordinsr{ motives thst actgate
ienies that the proposed distribution will
iffs or any Of them
This defendant denies that the plaintiffs
IRE able to return or to restore to this de-
endant the whole or any part OF the Gel
'ates for this defendants stock delivered / }
I, otherwise than upon the acceptance By the
,laintifs Of the ratable proportion Of the
tooks Of the Northern Pacific Railway Com
he plan Of distribution proposed and adopted
~ this defendant.
In conclusion the answer denies all
charges of unlawful combination or con-
piracy as alleged by the bill Of complaint.
Ind asks for the dismissal OF the bill OF
complaint
The answer is signed by Elhu Root,
ohm w. Griggs, John c. johnson and Fran
's Lynde Stetson, as counsel
crDErT mn TrnnrrS