The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-01-03
COURT UPHOLDS
DISTRIBUTION PLAN !
Injunction Restraining the Great
Northern Presidents Scheme
Is Dissolved. -. ~
HARTMAN INTERESTS -
I MAY PRoLONG FIGHT
Hill Says, However, That the De-
cision Ends the Con-
test.

Philadelphia, Jan. 3.-The United |
States court of appeals for the third |
judicial district, in an opinion fled |
here today, reverses a decision of the |
New Jersey circuit court which re- !
strained the Northern Securities COM
pany from distributing certain stocks
of the Northern Pacific Railroad COM
pany.
The decision is defeat for the in
terests represented by E. II. Hartman.
By a. decree of the New Jersey court
the Northern Securities company was
restrained from disposing of 370,230
shares Of the common stock of the
Northern Pacific Railway company, al
legged to have been received from e.
n. Hartman and Winslow s. Pierce,
and of $4,000 shares of the common
stock of the Northern Pacific Railway
company, received by the Northern Sc
curities company from the Northern Pa
ciic company.
May Dispose of Stock.
Today's decision, however, gives the
Northern Securities company the right
to dispose of the stock.
Hartman and Pierce, when the
Northern Securities company had been
declared by the United States supreme
court to be an illegal combination, de-
manded the return Of the original stock
they had contributed at the time of the
organization of the combination. The
Northern Securities company, it was
claimed, intended to make a pro rata
distribution of the stock Of the con-
trlbuting company.
The Courts Decree.
The opinion was written by Judge
Dallas. After reviewing the organiza-
tion Of the combination and it's .subse-
quent history, the decision says: ) )
Chairman averred that the shares Of
railway stock in question were acquired
ytheSecurities company; that itwould
hold them as custodian, depository trus
tee and owners of said shares were the
parties who originally exchanged the
same for stock in the Northern Securi-
ties company. .
.'''.HThe Northern Securities company
claimed that it acquired the stock by
purchase and that it owns the stock out-
right ,'..'.': ...s,s
After quoting the resolution under
which the stock was acquired, the opin-
ion says the resolution contemplated q
purchase and not a trust, and that the
resolution was adopted at a meeting at
(which Hartman was present. The
opinion continues:
Owner of N. P. Shares.
The Northern Securities company Is the
owner Of 1857, 594 shares Of the stock OF
the Northern Pacific Railway company
which has been restrained from voting o,
receiving dividends and in view Of this
restraint al parties agreed that it should
not continue. The Northern Securities
company accordingly proposes to assign
them pro rata to it's shareholders, includ
ing not less than $500 persons, whose
shares are unquestionably acquired b!
purchase, and who are not parties to Thu
suit, and as such disposition of then
. would effect a ratable, and therefore suit
able division Of them among all who ar
entitled to participate in a distribution
of corporate assets, we are Of the opin
ion that the injunction which prohibite
it should no longer remain in force.
Question an Open One.
If the question before us had been in
volved and decided in the suit Of tn
I United States VS.. the Northern Securitie
company or if it had been passed upo
tho but incidentally by the supreme coul
of the United States in disposing Of tn
appeal in that case, we of course woul
not regard it as an open one. But it wa
neither decided nor considered at an
stage of that litigation.
The petition or bill Of the United State
did pray that the stockholders of the raj
road companies who had exchanged the
stock therein for stock of the Norther
Securities company should be required
surrender such stock Of the Northern 81
curities company so acquired and held
them, and to accept therefor the railWa
stock in exchange for which the same
issued, but the decree insofar 1t we
mandatory went no further than to pr
hibt the doing Of the specific thins
which, being done, would effect the resu
denounced by the act-1903 U. S. 356.
This was all that was requisite and
was accomplished by that part of the d
cree which has been already quoted; ar
the added clause, tho apparently su.
gested by the prayer of the bill to which
referred, was obviously not intended
have any obligatory effect
Merger Decree Permissive.
+ It was permissive merely and this
plainly appears from it's terms that it
necessary only to direct attention to thel
They are:
but nothing herein contained shall
construed as prohibiting the Northern S
curities company from returning a
transferring to the stockholders OF
Northern Pacific Railway company, a
the Great Northern Railway company, I
spectively, any and all shares of stock
either of said railway companies viii
said the Northern Securities compa
may have heretofore received from su
stockholders in exchange for its o1
stock; and nothing herein. contained sh
be construed as prohibiting the Northe
Securities company from making su
transfer and assignment Of the sto
aforesaid to such person or persons
may now be the holders and owners Of
own stock originally issued in exchan
or in payment for the stock claimed
s have been acquired by 1t in the aforess
railroad companies" ... =. .
This decree was affirmed in it's enti1
tv and the compliments asked lea
to intervene in the Minnesota suit.
), Reviews Minnesota Case. .
The decision here reviews the MINI
sofa litigation and in conclusion say
From all that has been said in
foregoing. the decision below must
reversed. -
"A Judge George Gray Of Delaware fl
dissenting decision. He said:
I dissent from the Judgment of the n
jority of this court I do not think |
Continued on Second Page.