The Washington times., 1906-10-13
Story of London Stock
in Trust Caused Mo-
mentary Furry.
LAWYERS NOT WORRIED
Decisions in Northern Sc
CuritieS and Fertilizer Trust
Cases PrecedentS.

Financial New York. even financial
london, is considerably exercised over
the story from Fmdlay, Ohio, that one
OF the Standard Oil concerns is owned
By London holding concern. It has
been intimated that this disc Oyery has
brought tremendous shock o those Of
ncers Of the law who are intruslod with
enforcing the antitrust statutes, and
that perhaps even the whole program
of the antitrust campaign might require
revision TO prevent its craft going TO
pieces on this rock.
All these stories. it can be stated on
the best authority. are more interesting
than accurate. In two great cases the
Department of Justice has demonstrated
that the foreign holding company is an
Intellectual means TO eyading the law OF
this country
These two proceedings involved the
Northern Securities Company ana the
Fertilizer trust There is nothing about
The newly-disCovered General Industrial
Development Syndicate. Limited, Of
London. that frightens the antitrust
lawyers who know what vas written
into the decree in the Northern Securi-
ties case, and what has been done with
the Fertilizer trust
Northern Securities Case.
In the Northern Securities case, the
Government charged that the securities
company held the control of the North
ern Pacific and Great Northern rail-
roads. parallel and competing roads, and
that IL was for the purpose of suppress
ing competition. In its decree, the
court. among other things. ordered that
neither the Northern Pacific nor the
Great Northern should pay any more OF
their earnings or profits TO the North
ern Securities Company.
And where does your London holding
company come in. If we get su order
OF that sort affecting it's held concerns pc
demanded an officer OF the Federal law
service. We can't dissolve London
concern, but we can prevent money be-
ing paid 10 a London concern by any
corporation operating within the 1uris-
dicuOn of this Government. About the
time that happened there would be a
panic in London in the shares OF hold
ing companies"
So much for the civil side of the prob
lem On the side Of criminal proceed
tngs the Department of Justice has had
experience with q foreign corporation
ia the matter of the fertilizer trust. This
was formed several years ago, when the
fertilizer business was in bad way,
theFcOmpanies competing SO vigorously
that nobody made any profits. The
managers got together and talked it
over at Atlantic City and New York.
Finally lawyer who was at the time
thought mighty clever for his idea pro-
posed the plan that was adopted.
Government Got Busy.
A selling and agency concern was in
cOrporated in Canada; headquarters in
Toronto. Through it the output of all
the associated concerns was handled
prices were adjusted and eQualized. and
the trust became powerful and profit
able The Government got busy with IL,
however. and the foreign company,
which was really the essence Of the
trust. and had much more to do with
its management and practical success
than any mere holding company would
have. did not in any way embarrass the
Government when it set about in the
Tennessee Federal district, TO indict the
concerns that were parties to this con
spiracy. The indictments stand. and
are 10 come to trial soon, and there is
no antitrust litigation now pending IN
which the Department OF Justice has
greater confidence Ia its case than IN
this one. In a civil proceeding, il
necessity should arise. the subsidiary
corporations could be restrained from
making reports 10 or receiving directions
from the foreign concern. In short,
there is no difficulty at all, according to
the men Of law who have looked into II,
about managing the foreign holding
company and preserving the integrity OF
the Federal policy.