Los Angeles herald., 1908-02-21
BATTLE OF RAILROAD TlTANS
ENDED BY COURT
JUDGE DIssoLvEs INJUNCTION
AGAINST STOCK
Decision Cannot BE Appealed, but
Fish Is Determined to Take Up
the Matter in Another
Form
toontInued from Page onel

directors to Fish, they would not have
permitted such a suit to be brought.
Only One Thing Proved
1.-THE first reason given may be
passed as it is a legal conclusion and
| the alleged facts stated as the basis
| for the second reason are vigorously
denied in affidavits filed by said eight
| directors. .
.sThe only thing ayerred and proved
| in this case as to the future action or
the defendants is that at the coming
| election the Union Pacific and the
Railroad Securities company will vote
the stock they own and control for the
| reelection of three of the present di-
directors each of whom has served the
Illinois Central acceptably for many
years, and for d fourth director In
place of MIR. Fish a competent man
| who is not in any way connected Win
| the Union Pacific.
"No act prejudicial to the Illinois
Central nor It's stockholders is shown
to have been done unless the mere
fact that the Union Pacific and the
Railroad Securities company own "
per cent of the stock of the Illinois
Central be considered to be so. Since
the retirement of Mr.. Fish from the
presidency the policy of the company
has been the same and its executive
officers, with one exception, caused by
death. have remained the same from
that day to this. The relations be-
tween the Union Pacific and the llli-
nois Central are now what they We're
when Mr.. Fish was in power and as
sisted in shaping and consented to
such relations.
No Change Intended
"Nor is any change intended If the
affidavits of well known and repu-
table men may be considered as true.
The bill, however, charges many things
which may happen to the detriment
of the Illinois Central and its stock
holders IL the Union Pacific and the
Security company be permitted to vote
at such meetings, but no facts are
alleged or proved which even tend 10
bring about such results. Courts OF
equity act on fdcts alleged and proved,
and not on fears or supposed prohesies.
If IL were not for the fact that the
name of Hartman is name to con-
lure with these allegations would not
be taken so seriously. There are many
things stated in the bill as to the in
.n,.tio1i of the defendants which TX put
in force or even attempted to be put in
force. would call upon the court TO IN
tervene, but diligent search or the
record fails to show that such things
exist in any concrete form.
1.-THE compliments say that If the
| Union Pacific and the Securities COM
| pany are permitted to vote at the COM
ing election, the hold of Mr.. Hartman
upon and his domination over the I'M
nois Central will be reduced TO a sub
seryient position and will be given
the lean end of the carrying trade. But
they fail to alege and prove facts sup
porting these allegations.
"While Mr. Fish may righffully de-
sire to remain as director of the llli-
nois Central and TO that end may use
every lawful means i'll the power OF
himself and his friends, he has no right
to that office unless he is legally elect
ed thereto. Hence his defeat IL 1T
comes from the lack of valid votes, rs
no legal injury to the civil or property
rights of Fish or those of his FELLOW
compliments.
"As private citizens the compliments
are not keepers of the public con-
science. nor are they the conservators
of the rights of the public. To sus-
tai,, This biu II is not sufficient for
| them to show merely that the act COM
plalned of is a public wrong; they must
also show that by the doing of such
act they will suffer a special injury to
their civil or property rights. rms
election of directors at the coming
meeting can work no legal wrong To
the complainants and no special IN
! Jury to any of them is proved which
calls for the interposition of this
court"
One Ground for Maintenance
! ,rhe court then asserted that the
| findings and opinion of the interstate
| commerce commission are not evidence
in this case and declared that he mad
no power to enforce the sherman ac'
and quoted numerous legal decisions In
4 e l.. Tho decision
then continued:
sThere is but one ground upon which
| this bill can be maintained. II the
| Union Pacific has no right to ppy
| hold or own either the Illinois central
| or the Securities company or either oil
| them is intruding in this election
wholly without right, then think bona
| fide stockholders, without alleging IT.
reparable injury, may ask the court u
| throw them or 1t out.
This brings us to the question, is
there in the public policy of this state
prohibition against the voting by a
| foreign corporation of stock i'll do
nestle corporation, which stock is pur-
chased and paid for and held under ar
express power granted to 1t by the
state of its creation?"
| rhe court declared that corporations
Der Sc are not barred from using aud
holding the stock Of other corporations
and said the fact that the purchaser
might be foreign corporation and the
stock that of o. domestic corpora tioI
could not change the rule OF law.
He said
ar. Q reason why purchase OF tbs
stock of the Illinois Central by the
Union Pacific and the Railroad Secur-
| tiles company are invalid, If they are
invalid, must be found elsewhere thar
in the fact that they are foreign cor
porations.'
Can Own Other Stock
The court denied that there is any
rule of the American common law pro-
hibiting one Corporation from holding
|. stock in another corporation when the
| first corporation has in Its charter
specific power to do SO. In this case
| he said. it was proved and not denied
| that the Union Pacific and the Rail-
road Securities company each has ex-
press power granted to ii by tho state
| az it's creation to buy, own and hold
stock in other corporations. The court
then entered upon q long and extern
| sive discussion OF various statutes re-
garding the holding of stock by corpor-
ations in other corporations, declaring
| finally that such holdings are not pro-
| hibited by law nor opposed to the pub-
| lie policy He then said.
cgrhe right OF the Railroad Securities
company to vote its Illinois Centra
| stock IS unimpaired by the fact thai
the Union Pacific owns practically al