The Birmingham age-herald., 1907-04-05
Argument Before the Interstate
 Commerce Commission
VIOLATION OF SHERMAN ACT
Is Point to Be Determined and as to Forcing Hartman to Answer Cues tions-His Side Presented.
 Alton Deal Defended.


 Washington, April 4.-Argument in the matter of E. H. Harrimans railroad transactions was begun before the ir- terstate commerce commission today. Tho case commenced at 10 o'clock and when the commission adjourned for the day at 4:S0, MT Harrimans attorneys had not concluded their presentation in his be- half. The first of the series of ad- dresses was made by Attorney Paul D. M. Crayath, who represented not only MT. Hartman. but also Kuhn. Loeb & Co. and he was followed in the order named by Judge k. S Lovett and John G. Mill burn.
 MT Cravath dealt especially with the | Chicago and Alton recapitulaton, while | Mr. Lovett devoted most of his atten- ton to the attack upon the consolidation ! of the Union Pacific and the Southern Pacific roads, which was brought about i largely through Mir Harriman's instru- mentality. MT. Milburn had not conclud- ed when the commission adjourned, but so far as he went he dealt entirely with the union of the two Pacific roads. Mr. Cravath contended that the Chicago and Alton transaction had been misunder- stood by both the commission and the public and he declared that the proceed ings there followed were not unusual in financial transactions.
 Alton Deal
 MT. Lovett also gave some attention to the Chicago and Alton affair. contending that the public had suffered no loss on account of the method of recapltaiza- ton. With reference to the southern Pacific and the Union Pacific roads, he declared that they were mol competing 1 lines, but argued that even il they were the transaction had not been illegal be- cause the Southern Pacific had bean -puE- - chased outright by the Union Pacific. which was not in contravention of the constitution.
 Mr Milburn said that the general ap- plieaton of the antitrust law to tha railroads of the country as 1t was pro- posed to apply it in the Southern Pacific Union Pacific deal, would put every sys- tenn upon the defensive and that most of them would have greater difficulty than woHd the Union Pacific system in | meeting the attacks
 The proceedings are not in the nature | of hearing but merely an argumeut ] involving the question whether the Union Pacific and Southern Pacific railroads are competing lines. In his testimony before the commission in New York, E. II. Harr- 1 man insisted that the two lines were not competing lines.
 As to Prosecution.
 The interstate commerce commission is represented by it's special attorneys, Frank B. Kellogg and C. 4. Severance.
 On the results of the arguments may depend whether MT Hartman and his associates are to be prosecuted as q com bination in restraint of trade under tho l the provisions of the Sherman antitrust | law. When the stand in New York, MT. Hartman declined, by advice of counsel to answer certain inquiries put to him by the commission concerning tho i transfer of certain Union Pacific stock. It has not been determined yet whether the commission will endeavor to force MT. Hartman through proceedings in tho 1 United States courts 10 answer thosa l questions or not. In fact if was stated ] positively by members of the commission ! that the question not only had not been decided but it had not even been con- sdered to any considerable extent It is not likely that any decision this mat ter will be reached for some time, certain- | ly not until the commission has obtained. | through the arguments begun today and 1 from other sources, all the light that may 1 be thrown upon the matter. Mr. Harri- mans contention was that the transac- l tions about which he was questioned had no relation to interstate commerce, and | consequently the commission had no right | to the information which it asked It ia | probable that the commission, after 1t has gone thoroughly into the matter. will announce what action, if any, it proposes to take affecting MT. Harriman's refusal to answer it's questions.
 At the afternoon session Mr. R.. $. Lovett contended that in so far as tho receipts of the Chicago and Alton affected the public it had resulted in d saving of s165,0oO per annum as compared with tho expenditures account of interest and divi- dends prior to the change.
 He argued that all the criticism of the readiustment of the Chicago and Ahon's finances had been due to the unusual method pursued. and said that if the ordi- nary methods had been followed no atten- tion would have been attracted to the transaction. Taking up the relation of the Union Pacific and the Southern Pa- cihc, he contended that this was not an other Northern Securities case. for where- as the Northern Pacific and the Great Northern were contiguous as well as parallel, the distance from the Union Pa cifc lines to the Southren Pacific lines is fully a thousand miles. while there are many other railway lines in the inter- vening territory. He also entered upon an argument to show that tn Union Pacihcs purchase of the Southern Pacific had been in every way legitimate and legal and not in pursuance of a conspiracy. as was the case in the Northern Securities case. In the matter of the Union Pacific and Southern Pacific there pur- chase. in the other a conspiracy.
 Little interest seemed to be manifested in the proceedings, only few persons in addition to the attorneys in the case being present. Paul D. Cravath, repre- sentlng not only the Hartman interests, but also those of Kuhn, Loeb & Co. of New York, made a statement concerning the Chicago and Alton transtactions, which were developed in the New York hearing. He said that a misapprehension had been created, perhaps. in the minds of the commission, and certainly in the public mind as to the Chicago and Alton transactions and as to the purposes of the recapitalization of the line.
 Mr CraVath said that the time had come for much stricter regulation of the issue of stocks and bonds of semi-publio corporations. 'The liberal laws that have existed in this regard said he. have l LII