The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-05-05
INDICTED POR SUGAR REBATES
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Judge isol, and haadea down egvs1 indlcss
nyents against corporations u i0di.
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indictments NerW ssalsd and placet w the
custody NJ John A. shietda. clerh ~ tho
court
ais ~ the indictments ara for giving NJ
rereivins rebates IN violation ~ ths Flklna
law and other provisions ~ tho Interstate
laws against discrimination IN
freight mites. One each IL against tho
New York Central and Hudson River Rail-
road Company and the American Sugar
Refining Company. A third charges tho
New York Central and Nathan j. otiilford,
a vice-president ~ the railroad. with giving
rebates. Tho American Sugar Refining
Company ~ New York. a Subsidiary oon-
Germ Of the trust. IL accused In the fourth,
along with c. Goodloc Edgar n Edwin
Earle, largo wholesa le sugar dealers In
Detroit.
The hfth and sixth indict tho Now York
Central, Vice President Guilford and Cen
eral Traffic Manager T. L. PomOroy. and
also the American Sugar Refining Company.
the American Sugar Refining Company OF
New FORK and Edgar a Earle Of Detroit.
The seventh indictment charges con-
spiracy to violate tho interstate
law on the part Of Guilford. Pomeroy M
EhRar 4 Earle. This IL the most serious
indictment OF the seven. The penalty for
rebating il fixed at q fine Of from 81 900 to
$40. 600 for zach violation. The penalty
for conspiracy to violate a Federal law
falls under Section $40 Of the Revised
Statutes, which imposes imprisonment OF
not more than two years, or a fine OF not
more than IS, 900, or both, for each viola
ton.
The charges which eliminated In the in
dictments were filed with Acknowledgement
Moody at Washington in February. The
charges Of Relating were made against
several Of the differential lines as well as all
Of the trunk lines running out OF New York.
It was shown that the relations between
the roads and the sugar trust were 30 close
that the trunk lines divided up the entire
through west bound traffic OF the trust on a
pooling arrangement which had existed
since 1900. By this the Central got nearly
25 per cent. of the trust traffic. the Penn.
sylvania came next with 20 per cent. and 80
on down.
The trust got the rebates In return for a
monopoly of it's freight. The di fierential
lines, it was alleged. CAV their rebates
during o period in 1903 when the trunk lines
49, - L. koIl $40 80 the Nrttat NnzE
the trunk lines six months OF seeing their
cars go West empty and the slow. round
about diferential lines loaded down with
lucrative sugar shipments to induce them
TO give in and accede to the trusts terms.
T. p. Riley, the big traffic manager. who
cracked the whip over the railroads for the
sugar trust for five years.. was forced to APP
pear before the Grand Jury and testify,
as we're also Lowell M. Palmer. president
of the Brooklyn Cooperage Company, a
trust concern; Il. W. Parker. present traffic
manager for the trust; H. 7. Leeming. a
traffic expert formerly in the employ Of the
trust; officers Of the New York Central's
fast freight lines. and raffic and sugar men
from all over the country.
The strongest case was developed against
the Central. All the indictments returned
are based on a chain OF transactions whereby
the trust has been shipping sugar from
New York to the Detroit sugar wholesalers
over the Central fast freight lines. These
men were really a subsidiary part Of the
trust in Detroit, it Ia alleged.
The president Of each corporation In
dicted has been notified to appear for trial
at the next term Of the United States
Circuit Court, Criminal Branch, as have
also the individuals indicted. All are ex-
peoted to appear voluntarily.
The April Grand Jury will be discharged
on T~uesiny. Its recommendation to its
successor in regard to the rebate inquiry,
after commenting on the difficulty Of ss-
curing evidence, says:
These difficulties necessarily limit the num-
Der of cases In which any grand jury can.
within it's term OF Office. sift the evidence
down TO the point Of preparing and finding in
dictments. But the evidence thus investI-
gated by us bearing upon the indictments
which we have found has incidentally re-
vealed to us the probable existence OF 80 many
other instances Of similar offences ms TO indi-
cate a general and systematic policy. pur-
sued by certain large shippers. of extorting
from the different railroad companies favors
the legality OF which Ia at least questionable.
The evidence before us has related mainly
TO shipments of sugar from various sugar re-
dneries In this locality to Western markets.
In addition to the ases In which Indictments
have been handed down this evidence has
indicated that rebates have been regularly
given to suear reiners and their customers
by several other interstate lines. that a regu-
lar allowance Of two cents per hundred
pounds has been made by various railroad
companies to sugar re fners TO cover alleged
ca ria ge--an allowance which. though usually
published In the tariffs. often represents no
labor actually performed, and which Ia not
made to other shippers OF similar commodities
and that other special favors OF various
kinds have been regularly made In regard to
sugar shipments either to the rehners them
selves or to their officers and agents enga ged
In subsidiary business-like liRhterage.
The evidence before us has shown clearly In
several instances. and has indicated It TO be
the fact quite generally. that the Elkins law
as TO the giving OF rebates has been disre-
garded since the day Of Its enactment.
Although the detection and proof OF
class Of crime is difficult and well nigh
impossible in spite Of the most con SCI
and untiring effort Of the Fart Of
prosecuting officers and Federal Grand
Juries, nevertheless the jurors deem 1t
their duty to call the attention Of this
honorable Court and the succeeding Grand