The San Francisco call., 1905-08-01
ANSWER FILED
By SANTA FE
Railroad Denies That It
Has Granted Rebates in
Defiance of the Court
ADMITS FORMER GUILT
JuStiies Its Action on the
Ground That Other Com
panies Were Doing Same

KANSAS CITY, July SL-The Santa Fe
Railroads answer to the proceedings be-
gun il the Federal court here, charging
il with contempt OF court In violating the
courts injunction against giving rebates,
was fled to-day. The argument IN the
case probably will not be heard until
some time il the fall.
The complaint against the Santa Fe
was that 1t granted rebates to the Colo
rado Fuel and Iron Company on coal
shipments after having been enJoined
from such practices, along with dozen
other railroads. The institution OF the
suit is the result Of an investigation on
the part of The Interstate Commerce
Commission.
II its answer, the Santa Fe admits that
at one time it did give rebates, but claims
that il has not offended in that respect
sance the Injunction was issued. Its ar
rangement with the Colorado Fuel and
Iron Company, It says, was a perfecuy
legitinate one The Santa Fe accused q
rival Of the Colorado Fuel and Iron Com
pany of being the instigator OF the suit
against the road. Its answer says;
Prior TO the fling Of the bill Tor an
injunction in the above cause, compeu-
ton between the different railroad COM
panies for the transportation of grain
and packing-house products from the
Middle Western States and to'secure such
traffic became 50 marked and manifest
that this defendant was satisfied that the
published tariff rates Of other competing
carriers were being secretly cut on such
commou---es. and in order to protect lts
own traffic and TO secure a fair share OF
such traffic for itself, as against its COM
Detitors il found that it was necessary,
owing TO the deception practiced by other
carriers, TO also secretly cut its own pub
lished tariffs upon its own lfne, where II
found the same necessary TO secure or
protect the traffic Of the aforesaid COM
modities, and that when an investigation
was had by said Interstate Commerce
Commission. as referred to in said In
formation, in regard 10 the secret rate
cutting on grain and packing-house pro-
ducts Paul Morton. its second vice presl-
dent and then in charge OF its trahlc'
freely laid before said commission the
methods adopted to secure trafne IN salu
commodities in competition with tne
other carriers in order that the unlawful
methods INDUCED in might be fully ex-
posed and a stop put, If possible, 10 such
practices"
The answer says that Immediately
unon the issuance of the restraining
order the traffic managers OF the va
rious Santa Fe lines notified the trafhc
agents of the company Of the order ana
instructed them to comply with it.
The lOlOfaQO J. uGl anu AAOA NS--A
many. the Santa Fe says, is result OF
the desire Of some competitors and
similar industries along the line of the
FL Paso and Southwestern Railroad TO
use the kind of coal mined by the Colo
RADIO Company. The FL Paso and South
western. a connection of the Santa Fe
Company, has lines to the Colorado
Company's mines. There are coal mines
nearer to the smelters than the Colo
2 tee II ffr-G
do not like 10 use their coal, says the
Santa Fe, because it is not a good
steanl-maker.
In order to secure this coal traffic,
saws the Santa Fe, il made an agree
ment with the EI PasO and Southwest
ern to haul coal TO connecting points
with the latter road, for which service
the Santa Fe was to receive as Its pro-
portion for the haul 81 80 a ton. The
smelters and other industries agreed
to pay the Colorado Company 81 10 a
ton for this coal.
When the restraining order was
made, saws the Santa Fe's answer,
tariff was published covering this
agreement. It is alleged against the
Santa Fe that 1t violated this published
tariff and on this point the answer
says:
In preparing said joint tariff said
traffic manager inadvertently. but with
out any desire to evade such order, IN
cluded in said joint rate prescribed in
said tariff the cost of coal. but this
defendant at all times received upon
the coal so carried under such joint
tariff only its proportion or agreed
division of the entire or through
charge of carriage"
The answer contends that the prac-
tice of collecting from the smelters the
price Of the coal and the freight charge
was to facilitate business and not TO
afford vehicle for rebates.
The answer names the Caledonian
Coal Company, whose coal, the answer
says, the smelters would not use. as
the instigator OF the Interstate Com
merce hearing that resulted in the suit
against the Santa Fe.