The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-04-06
ONLY 4 DREAM
OF HARTMAN
Mr.. MiIburn Contends That
Control of Railroads by One
Man Is Not Practicable.
GOVERNMENT CASE ARGUED
CONVENTIONS SUSTAINED BY
THE COURTS.

.. {. o {. 3 o :, q . q. {. {. =. q. :. . 6. @
d" Washington. April after two 6:
d. days of argument the interstate 9
e, commerce commission today con- %
% Guided its hearing in the invesu- .
q. cation Of the transactions or L. q"
q. II. Hartman in Southern Paclhc g
% and Chicago & Alton securities &:
d" and took the case under ADVISE
o. ment. There were three addresses
3 today. one by Attorney John q. 9
., NIilburn in defense Of Mr. Harri- .
@. mans course. one each by Special 9
%. Attorneys G. a. Severance and &:
Frank c. Kellogg in criticism OF II. %
MI MiIburn enlarged upon the .
@ contention that the Union Pacific @
g. and Southern Pacific had not been .
90 competing lines before their con- @
.. solidatfou but urged that even if o
e, they were. one of them had the o
e. right to purchase the property of o.
a. the other. MessTs- Severance and o
q. Kellogg cOnteDded for the appliCa- .
.. biIity-of the antitrust law TO the %
e. purchase of the Southern Pacific {:
&. bv the Union Pacific, and Mr.. KEEL .
O.. IogC criticised sharply Mr.. Harri- {.
d.. mans dealings in the Chicago & .
$50: 3 :. s. (. 4. . 10000 % o
Washington, April 5-Continuing his
argument today before the interstate
commerce commission in support Of the
legality Of Mr.. Harriman's's railroad
operations. Attorney John c .Milburn
laid down the following general propo-
siionts.
IA restraint of trade. to be within
the antitrust act must be the direct,
immediate and necessary effect of the
transaction. and not merely an indirect
OF incidental result.
"A restraint of trade consequent
upon any purchase of property, in any
of its various forms, is incidental mere
~ and therefore not within the act.
3-The purchase must, of course, be
real. if mere device for the suppress
sion Of competition, as it was held to
be- in the Northern Securities case,
While il may be effective to operate
upon the legal title as between the par
ties. il is in fact unsubstantial and may
be disregardcd.
Provided the purchase be real and
substantial the motive which induced
it cannot effect the result. for any re-
sultant restraint of trade is still only
consequential and incidental to the ex-
ercise of an absolute and undoubted
right, that is, the right TO acquire prop
erty.
Restraint Merely Incidental.
therefore the purchase by a rail
read company. within its corporate
powers of an interest in another line
of railway. is not within the act, be
cause the restraint upon trade. if any.
is not direct but merely incidental to
the purchase.
ST, however, the purchase by a rail
~old company, within its corporate
powers. of a line Of railway. made to
suppress competition, be obnoxious to
the act. that result does not follow III
the purchase be made for a legitimate
and proper purchase of the purchasing
company.
In any event. a purchase by a rail-
road company of an interest in a line
of railway which is not parallel and
competing, is not within the act.
S-The purchase by the Union Pacific
of its interest in the Southern Pacific
was not made to suppress competition,
bat to protect its property by an ex-
tension of its line in that way TO the
Pacific coast.
s-The Union Pacific and Southern
Pacific are not parallel or competing
lines or systems.
MiIburn's Argument.
This summary proved to be the out
line of his entire speech, and he fol-
lowed the presentation of these points
with an elaboration of them, giving
special attention to the contention that
the purchase of the Southern Pacific
by the Union Pacific was a legitimate
business transaction and not in any
way in contravention of the antitrust
law. He said that if the laws of a
state by which the Union Pacific was
chartered had prohibited such pur-
chase it could not have been legitimate
ly made. bat that in no event could the
federal antitrust law be held applica-
BILE
He cOntanded that the main purpose
of tile purchase had been 10 gain a
through line from Omaha 10 San Fran
cisco, and declared thai there had been
no subterfuge about Or hidden motive
in the deal 1t had been bona fide pur-
chase. and could not be criticized as
business transaction from any point OF
view. Having no purpose of preventing
competition, it did not fall within the
meaning Of the eSherman law
Calling attention to the fact that Mr.
Hauiman's purchase of Southern Pa
cifc stock had occurred at the same
time as his purchase of Northern Paci-
hC stock, Commissioner Lane suggested
that the two transactions might indi-
cate a purpose to control competition
in trauscontiHenta1 business. but Mr.
Milburn said that the record in the case
indicated no such purpose, the two
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