New-York tribune., 1908-02-16
REBATE PROSECUTIONS
rOR SOUTHERN PACIFIC.
teton To BE Taken by Government
and State of California.

washington. Feb. 11.-Prosecutions are to be
-..,,+ed bv the government against the South
= Tsciac Railroad Company and certain OF its
.n.,a,s on charges that they paid rebates to
shippers
r,-o Information which is TO be used basis
= .bese prosecutions obtained by Franklin
: sne OF the Interstate Commerce Commits
= last fall in the course os an extensive in
= made by him into the methods OF the
.t,.-n Pacific company. BY direction Of the
mission Mr. Lane visited the Pacific Coast
- Cor several weeks conducted his inquiries
= t,,e alleged charges Of rebating which had
.e,ea the commission The report Of his in
-..-irstion. including transcript of the testi
- -aIen by him in a formal hearing as an
-s-ste Commerce Commissioner, was made
-,rir to-day. The report has been approved by
=, commission. and transcript OF the report
- .re evidence taken al the hearing has been
s,sr,i,red to the Department of Justice for
-, PROSECUTIONS under the law may be
Narrated
A. lis ovvn request a transcript Of the report
4 evidence has been furnished 10 the Railroad
-o-o-nission al California. which has indicated
. -be Interstate Commerce Commission its
-,,ea 70 prosecute alleged violations of the
r.,iso-nia law that may be shown by the re-
port
= ,-,l,,r,lina1,s and in the course of the report
,,-ens5ye references 10 the verbatim testimony
:. made as q basis for several para agraphs of
the report
one n the particularly interesting features
os The evidence came up at the close OF the for
20, hearing when Commissioner Lane refused
= Mace OF the witness stand G. W. Luce, gen
a1 freight agent OF the Southern Pacific Com
80 a 4 witness under oath. The request that
,f- Trce give sworn testimony in the case
made nv 2 2 Dunno. counsel for the Southern
ra,f4o Company Commissioner Lane declined
% administer the oath to Mr.. Luce. because, he
4-snklx stated he did not wish 10 accord 10 Mr.
;yoe by administering oath 10 him and
-s,5nr his testimony immunity from prosecu-
.i,r fo- violations of the law He offered TO
.os;zs 2 statement from Mr.. Luce respecting
=. rebate practices Of the Southern Pacific
ca-rranv and enter il part Of the record
:, the case but he made il clear that this state
-nert vas not 10 be made under oath
COMMISSIONER LANES REPORT
7, -he course Of his report Commissioner Lane
.s,s -Hat his inquiry conducted in San
zsrois~o on October - , and /. 1897. and that
e-rn the evidence taken he finds:
The existence of an extensive system OF preferen-
IA rates granted 10 certain shippers on stale busl-
nr6 dfscioses list Of las firms corporations ano
tndivi6usls who enjoy what are known as spe.
"a inside -sres-iess than the rates publlshed 10
.5a general rubic-on the movement of certain
designated traffic between points within the state
Thar slippers paid the fun published rate in the
f-st instance and were allowed the reIuhd upon
claims which went through the auditing depart
rasnt under Instructions from the traffic depart
fr--as-are shipments without tariff authority
RAJ sueh refunds amounted in various months
q he years 1906 and 1907 from $4,000 to s5ooeo
Taa1 such refunds given to one firm amounted tt to
7he sum q S23 sss during the period from Apr1l.
lsss t1he cate of the San Francisco fire, when all
previous records we're destroyed TO September q
lel-. and such refunds TO other shippers ranged
II amount from Sl3.6s0 te s22.251-
Tasr such refunds or discounts from the regular
rates have been continued for long period and up
4 ne dste OF the hearing IN October. 1897
TLa- many of such state shippers 10 whom such
refunds v-e-s allowed We're large interstate ship
That one q such shippers admitted at the hear
i1z tha- -ta granting OF such inside rate on the
s.ste movement Influenced the routing Of stlbse-
eusHt interstate shipment OF such traffic over the
rsis OF tle southern Pacific company -.
q The Southern Pacific company provided. by
voucher dated 5-v 81 1906 Tor The payment 10 an
tafersc2te shipper of oue-haf OF the local rate
winch suca shipper had paid 70 9nether railroad
ta- tie movement from point OF oriefn to a soutn-
en Pacific -er7ial where the traffic began us in
ts7state journey the Southern Pacific lines
Ihaf uet- existed tor Years an understaId!hg
between thu Southern p aeitic company and the
s4nia 2 coTluarf ard certain shippers OF driea
llil llzt The traffic winch moved INTO ionts "l
eonoentratl1 Tor transeontinental shipment should
fe entitled ~ the end OF The shipping season 10
refund q o-=.stf Of the local state rate charged
e the tine s- rhe original movement
That the voucher books containing The So-caled
refunds s-..re shipments also contained records
g refunds given anon Interstate shipments
Thar sf SrCh refunds interstate busl-
seSs Fere paid l5Z the special written direction OF
fegIr officials after tbe claims had been denied
p rle suEi. ing department
The 5gsri1s4rg1 offered by the officials and rep
iNSenIstives 1E= Southern Pacific company for
~ practices revealed WAS that in general they
were made necessary 10 secure traffic which ship
pes To1-c move otherwise were such rebates not
granted.
Il view ot The foregoing il is directed that
oFT c: TIE transcript Of the testimony in this mat
- = forwarded 70 the district attorneys Of the
trltea states Tor the several judicial districts
wherein affe-@es against the 10 regulate COM
n--ne Werr roru1Tsitted. shown by this record.
&C that such officials he requested to- institute
-ured
BY Instruction q Attorney General Bonaparte
uae district attorneys have already taken up the
ssses 10 be Instituted for the purpose Of begin
--s TIE formal proceedings soon as possible
Names q the officials against whom the prose-
eeoons VIII he directed are not disclosed and
Probably viii not be until indictments by federal
gard 5u-ies have been returned II is indicated
Is -zelr THAI the proceedings Of the Department
g Justice VIII he directed not only against the
Southern Pacific company and officials OF that
company. hut also against shippers who have.
according 70 the allegations, received rebates
Ton the railroad company.
gTIDEEDS TO UNION PACIFIC.