The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1905-03-07

pcNlcu-
/, NEW YORK, March 6.-W. p.
Clough. vice president and counsel of
the Northern Securities company. said
today concerning the decision of the
supreme court in the Northern Securi-
ties case:
Until the decision has been read 1t
is impossible to comment on the full
meaning of the dispatch. 1t looks very.
much. however, as If that ends the
matter. II the decision favors Mr.. Hill
it means that the pro rata distribution
will take place. 1t cannot be stated at
this time when the actual distribution
will take place"
History of the Case
The Northern Securities company
was formed in November, 1901. Suit
was brought to dissolve the new COM
pany in which the United States was
the complainant This suit was filed in
the United States circuit court at st.
Louis and in 1903 a decision adverse
to the company was handed down An
injunction was also granted by this
court forbidding the company to inter-
fere with the roads In which ii was
interested; to acquire any more stocks
or to receive dividends on the stocks
already acquired.
This Injunction was modified later so
that it was possible for the company
to receive dividends pending the deci-
sion of the appeal which was taken to
the supreme court. The highest court
affirmed the decree of the trial court
decree and injunction were wiped out
This was In March last year.
With this decision against the legal
ity of the company as a basis the
stockholders of the Northern Securi-
ties at a special meeting called for
the purpose decided to reduce the cap
ital stock of the company The plan
adopted by the stockholders was to re-
tire 80 per cent of the stock and make
a pro rata distribution of the assets Of
the company.
At this point f. II. Hartman and
Winslow s. Pierce, acting for them
selves and the Oregon Short Line in
terests. secured a temporary restrain
ing order from the New Jersey United
States circuit court. The order forbade
the distribution of the stocks held by
the Northern Securities company ac-
cording to the plan poposed by Mr.. Hill
and the stockholders and urged that
the Identical Northern Pacific stock
that they alleged had been contributed
to the company be returned to them.
An appeal from this temporary order
was taken by the company, and Jan. 3
a decision was handed down by the
United States circuit court of appeals
dissolving the injunction and placing
the concerns of the company in statu
quo.
The Hartman party then obtained n
writ of certiorari and placed the whole
case in the jurisdiction of the United
States supreme court.
Question Is Settled
Yesterdays decision of that body az
70
and settles the question of the right of
distribution under Mr.. Hills plan.
The major part of the assets of the
Northern Securities company consists
of the capital stock of the Northern
Pacific and Great Northern railroad
companies. Roundly the value of the
Northern Pacific stocks was $153.OOO.-
900 and that of the Great Northern
$123, O00. 900.
The contention of Hartman was to
be awarded S7S.0O0,000 of the stock of
the Northern Pacific, which would
have been just enough to give him con-
troll of that valuable property.
The total capitalization of the North
ern Securities company is 1895. DOC. 600,
and under Mr.. Hills plan of retirement
1t would be reduced to 1880, 900. II
was proposed to return for each 100
shares of the Northern Securities stock
1927 shares of Northern Pacific and
80. II shares of Great Northern, which,
with the dividends that have accrued
amounting to about $500, make up a
valuation of about $4,000 for each 10C
shares of stock.
Under this plan Hartman and the
Union Pacific interests would receive a
minority of the capital stock of both
the Great Northern and Northern Pa
cific, and the Burlington, which was i
component part of the Northern Securi-
ties company. would be detached
and made a feeder to the Union Pacific
system.
This point has been urged as one OF
the great and important matters in
volved in the issue from the viewpoint
of the northwest.
Citizens Are Pleased
The meager report of the coming de-
| cision of the supreme court was
| received yesterday in st. Paul and nu-
merous prominent citizens expressed
| themselves as being we'll pleased
! They say that the prosperity of the
great railways is necessary for the
| prosperity of the northwest, and thai
| If they were divided as to ownership
the effect would be uncertain at best
! They say if the Northern Pacific was
allowed to go to Hartman and a con-
| trolling interest in the Burlington. the
erect could not be good. In that case
| the Burlington could be made tribu-
tary to the Union Pacific, where 1t now
supplies traffic for the northwestern
lines. and by doing so would greatly
| decrease the we'll being of this section
The time when the actual distribu-
| ton of stock will commence puzzled st
Paul citizens somewhat, but the gen
eral opinion seemed to be that il would
J take place in the near future. The
original bill filed by Hartman prior
to the granting of the injunction ha:
not yet been dismissed, but il is saiC
| that the dismissal of the bill is but tn,
matter OF a few days time at the most
The distribution of the stock &C.
! cording to Mr.. Hills plan was the
| question at issue in the suit. and the
| matter of law carried up to the SUI
preme court in the injunction proceed
ings. The court held that the plaI
| of distribution, was lawful and as the
| company had been declared unlawfu