New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1907-03-03
MAY BE SUITS AGAINST L. p.

Belief is being expressed in the financial dis
trist that the evidence before the commission
regarding the Union Pacific ownership and con-
troll OF the Southern Pacific Will lead TO litga-
ton intended to force the Union Pacific TO unload
its Southern Pacific stock In the event Of such
litigation being successful. it is said. the Union
Pacific might find way 10 transfer its Southern
Pacific holdings TO friendly hands As to the
Union Pacifc's holdings Of stocks Of other rail-
roads, it is said that litigation may be begun 10
compel another unloading. the ground that
such stock ownership gives the Union Pacific
too commanding position among the great
railways Of the country. Members Of the COM
mission asked MI Hartman with evident con
Germ where the buying up of other railways
would end, and his reply was that the Union
Pacific not buying up the securities 81
other railroads for purposes OF control but
merely for the purpose OF gaining an additional
income from investments
Testimony taken before the commission
showed that in the last ten years the average
ten-mile rate Of the Union Pacific has not been
decreased materially. while the rates on other
transcontinental lines. with the exception OF
the Southern Pacific, have been decreased con-
siderably. Mr.. Hartman contended on the wit
ness stand that there had been a decrease OF
average freight rates both the Union Pacific
and Southern Pacific. but that the facts did not
show in the prepared tables. parity DeCduSo
branch lines of the Union Pacific were per
mitted 10 charge higher rates and parity pc
cause the quality Of freight passing over the
line had improved. The railroads chaIBeu 10"
rates on coal and lumber he SAID, ana
much higher rates on the products OF the Farms.
The Union Pacific he said carried larger pro-
portion of the latter kind of freight than was
carried over other transcontinental lines ana
therefore, its average rates were made 10 appear
higher. The report of the commission on me
question of decreasing rates viii be awaited with
interest.
MR. HARTMAN on FREIGHT RATES.
Members Of the commission piled Mr.. Harri-
man with questions regarding the relation which
freight rates should bear to railroad earnings.
Mr. Hartman insisted that a railway system
which improved its traffic facilities so as to be
able TO carry freight with less expense thail Us
rivals ought TO have the advantage IA ulElueIIus
on its stock He was asked 10 ten what he
thought would be excessive dlVldend before
lowering the freight rate. and he deemed al.
though he stated his opinion that a dlNldehd OF
- per cent would not be excessive
Some surprise has been expressed IN the imam
testimony from William Rockefeller regarding
his purchase. with promise 10 sen back ~
S30OO0OO0 of the Union Pacincs holdlhgs OF
Southern Pacific stock at the uIne James X
TZeene tried 10 get control of the Southern Pa
ciic board and have DIVIDENDS on lhe STOCK
declared. Mr.. Harriman's explanation that the
transaction was intended TO prevent a specula-
tive pool from getting control OF the property
did not take account Of the reports IN wan
Street that the S3DiHbO,eUO OF St"Ch SoIu 20 M
Rockefeller was thrown into the market for
time TO knock down the price or the stock and
cor,pel the dissolution of Mr. heehe's pool
Mr. Hartman was not asked as a witness II
the same stock certificates, comprising tho
$40 ono 600 OF Southern Pacific stock sold 10
M Rockefeller. were returned six months later
10 The Union Pacific by Mr.. RockefelleT. There
has been belief among Wall street men that
The certificates returned 10 the Union Pacific
wee largely those which the keene pool had
disgorged bought in the market at a price
.liIch lower than the price at Whlch the STOCK
WAS sold 10 Mr.. Rockefeller
THE c. & A REORGANIZATION.
4 great deal OF testimony was taken at the
inquiry regarding the reorganization of the
Chicago & Alton by the syndicate composed OF
H.. Hartman George }. Gould, James still
man and Mortimer /. Schin. It was brought
ON in the inquiry that in the reorganization the
directors had $40 100000 OF unexplained ex-
Dendittlres for construction. the accumulation
OF several years. charged on the books to capt
TAI account and against that account was
charged a dividend of 80 per cent the capital
stock OF The company. AS the syndicate had
bought nearly all o. the stock, IL received the
dividend.
To provide for the dividend and to make some
improvements 20 the property. the directors is