Omaha daily bee., 1906-06-14
FINE FOR RAILROAD
Burlington Line Found Guilty Of Granting
Rebates to Packers,
-FOUR COUNTS IN THE INDICTMENT
Penalty is $1,000 to $4,000 for Each
0ffense Charged,
SENTENCE is DEFERRED UNTIL IUNE u
Device Of Through Export Rate Used to
Favor Big Shippers,
ENTENCE is DEFERRED UNTIL IUNE u
COURT RULES CONTRACT is INVALID
Judge Holds that Published Tariffs
Must Apply 20 All Business
Handled After New Rate
il Filled.

KANSAS CITY. NO. June 13.--Thc Chi
cago, Burlington & Quincy Railway COM
pany was found guilty here late this after
noon by jury in the United States district
court on four counts Of granting conces-
sions on packing house shipments for ex-
port to the Armour Packing company, Swift
and Company, Cudahy & Co. and the Nelson
Morris Packing company. The conviction
carries with it fine of from 81 900 TO $20,VD
on each count. Judge Smith Mcpherson,
the presiding Judge deferred sentencing the
defendant until June q. All four counts
are practically the same The case of Ar
mour & Co, which instructions were
read to the jury, charged specifically that
the Burlington railway on August H. 1905,
accepted shipment of oleo oil from Kan
sas City TO Liverpool at a rate that in
cluded rate of % cents hundred pounds.
Mississippi river TO New York. whereas
the regular tariff at that time was IS
cents.
Agreed Statement OF Facts.
To simplify the case A. S. Van Valken-
hurgh. district attorney. for the govern
ment and Judge o. NJ. Spencer OF st.
Joseph, representing the defendant COM
pany, signed an agreement of facts, which
was in effect that the Burlington did con-
tract with the packers to carry their prod
]
rate of 40 cents for the whole distance from
Kansas City to Liverpool. Half dozen
witnesses were examined, their testimony
being largely technical and pertaining to
| the tariffs in existence at the tine covered
| I'm the indictment.
Those who testified today were II c.
Davis, general agent at New York of the
Eehigh Valley railroad; Robert S. Dous-
man OF Philadelphia, auditor of the freight
department of the Lehigh Valley; G, A.
Gamble, agent at Kansas City of the Read
! ing Dispatch. which operated in the inter
est of the Glover Leaf OF the connect
ing roads; Harry c. Burnett OF New York,
assistant general freight agent of the Le-
! high Valley, and Ernest F. Bisbee, gena
| eral agent at Kansas City of the Buring-
ton railway. who was commercial agent OF
that road in 1905 at the time the 20 cent
rate with the packers was made.
Contention of the Railroad.
Judge q. NJ Spencer. in his argument for
the defendant contended that the Bur
lington railroad had Joint rate under its
contract with the Glover Leaf and Lehigh
Valley railroads to carry the packing
house products at rate which would have
been valid under the present ruling OF the
court had II been established. Hence the
only crime, IL any, was the falling to pub
lish the tariff under the contract. The
evidence showed, he said. the shipment
was a through shipment TO a foreign destI-
nation. The charge in the indictment was
granting a concession from portion OF
through rate. Such proposition. he
tended, is unknown TO the law. II
cession was made at all 1t was on the
tire or through Sate and reduced the
through rate the amount OF such conces-
sion. but 1t did not and could not be Of
fered to any fractional part OF the through
rate. The Burlington kept to its con-
tract, made in good faith, kept in good
faith and would prefer to be fined. If need
be- than violate it's contract. Whatever
it's dereliction may have been in reference
to filing its tariff, 1t cannot be guilty as
charged in the indictment. The indictment,
he said, is the result OF a controversy
with the Lehigh Valley railroad over its
keeping It's portion of this contract and
when it unable to explain itself It
resorted to the government and lugs the
Burlington into court as criminal. That
such a state of affairs exists is to be de-
plored There should, he contended, be no
interference by the government in such
controversies. This. therefore. was simply
: a pecuniary question between these two
: corporations.
Reply OF Government.
District Attorney A. s. Van VakenburRh
arguing for the government. said simply
that it was plain case of violation Of the
Elkns act. The Burlington railway had
made a contract with the packing COM
panics at rate of % cents a hundred and
had continued 10 live up TO that contract
after there had been filed with the Inter
state Commerce commission an amended
y tariff of 80 cents
Judge Mcpherson I'm instructinE the Jury
said that the Burlington railroad had no
right to make contract for a period
longer than the established rate OF s cents
; should be in force. To have carried ship
ments for % cents after August II, 1905.
" when the tariff was raised 10 a cents.
must be considered a concession The
: failure OF the Burlington railway TO file
the schedule Of p cents was immaterial.
Statement by Packers Attorney.
= CHICAGO, June BE. Il. Hartweu Sec
retary Of Swift and Company. packers re-
: ferring today 10 the decision Of the so
/ called export rebate case in the federal
:, court yesterday at Kansas City, said:
The case in question does not involve
| rebates. The shipments were made at the
/ contract rates and payments Of freight
l. . made accordingly and all rates were shoWn
on the bill OF lading, no rebates being r.
! CeNcd. The supreme court OF the United
states has held that the rate on eEpott
| / shipments may 5e less than the rate On,
= interstate or domestic shipments II Judas
I McPhcrsons opinion is sustained no ship
= per can figure In advance what II will cost
hiIn TO transport his products and will bs
seriously embarrassed In making contracts
for future delivery. In this case the law
was not 80 determined in advance thai
Swift and Company could know they were
II violating the law, and, as a matter OF fact
Il we're advised by able legal counsel that II,
acting on the contract they were not vlO-
u lating the interstate con nerce act.
y -----------------
e Dead Man Identified.
J. KANSAS CITY. June l8.-Clark Rice d,
! Kansas CITY whose dead hpdt- ,vas frstn,l