New-York tribune., 1908-01-26
GOVERNMENT TO SUE
HARTMAN ROADS.
MR. BON4P4RTE STATES
HIS PL1NS.
Action in Equity to DissOlve alleged
Merger of Pacific Lines Ordered
Hartman Among Defendants.
fFrom The Tribune Bureau. :

Z
Washington. Jan 25-Attorney General Bona
parte to-day directed that bill in equity be
/ filed to set aside the control by the Union Pacific
Railroad Company and it's subsidiary corpora
tions Of the Southern Pacific and the San Pedro.
/ Los Angeles & Salt Lake Road: also 10 have
/ declared Illegal the ownership by the Union
Pacific or the Oregon Short Line Of stock in the
Santa Fe. the Great Northern and the Northern
Pacific. it being alleged that all these lines are
/ competitors of the Union Pacific. on the ai!ega-
| tion that they conceived and carried out the
conspiracy complained Of F. II. Hartman, Jacob
II. Schiff. Otto Fl. Kahn. James Stiman. Henry
q. Frick. Henry H Rogers and William \. Clark
are cited individual defendants
1t is the assertion Of the government that This
case is analogous to the suit brought against The
Northern Securities Company. in which the
Supreme Court ordered that company to reln-
quish it's control of the Northern Pacific. tire
| Great Northern and the Chicago. Burlington e
Quincy roads. This suit grows out OF the in
vestgaton by the Interstate Commerce C0su-
mission of the so-caIled Hartman roads IL IS
learned that the decision bring civil suit
/ dispOses OF all question of IA criminal suit. and
also that the government will bring no suit as
a result of its Investigation of the alleged manip-
ulation of the Alton road
MR. BONAPARTES STATEMENT.
The Attorney General issued an official state
ment which. after referring to the extended in
vestigljion by the Interstate Commerce Com
mission into the relations existing between the
various lines Of road engaged in transconti-
mental traffic. says
From the evidence adduced and from indie
pendent investigation the department has ar
rived at the conclusion that the stockholding OF
the Union Pacific and LIS subsidiary company Ia
the other corporations mentioned above is in di-
rect violation of the Sherman act
The department regards the suit as OF the first
iV,oT,f II * ought bN TlE4
break up a substantial monopoly of the trans
pOrtation business OF the country between the
Missouri River the east and the entire Pa
ciic Coast south Of Portland the west
Aside from The railway companies above
named the other defendants in the suit the
Farmers Loan and Trust company OK Ne"
York. which is the depOsitaTy OF all the stock OF
the San Pedro Road under contract by which
il is required TO give proxies TO such persons as
may be named by Mr.. Hartman and Mr.. Clark
for a period of years. There also the fol-
lowing individual defendants, who are alleged To
have conceived and carried out the conspiracy
complained of, to wit: T. H. Hartman Jacob
III. Schin Otto n Kahn. James Stilman. Henry
C-~-Frick. EsnFy-H. Rogers and William x
Clark.
NO CRIMINAL PROCEEDINGS.
While naming the individual defendants. the
statement makes no mention of any intention 10
prosecute any these officials personally in any
criminal proceeding The statement continues.
II appears by the testimony in the possession
Of the department that combination VAS
r II hartman or New York 'he preSidenI am
chairman of the executive board of the Union
Pacific. and certain OF his associates for the pur-
pose Of obtaining a monopoly Of all tranSCOnti-
mental transportation business The first move
made the acquisition OF sufficient stock OF
the Southern Pacific Company 70 insure It's con-
troll That company owned a line of railroad
extending from New Orleans and points in Texas
on tidewater through California 10 Portland.
Ore; also another line from Ogden. Utah. to san
Francisco. The Southern Pacific had been for
years Of the principal competitors OF the
Toto A. ~Ha Of n 1s-r,lh
stock ownership the management of the two
companies has been anna algamated. and since
1902 a ma jOrity OF the board of directors of the
Southern Pacific have been members of the
board of directors Of the Union Pacific Compe-
ttion between the two companies has been sub
SJantidlly eliminated.
The San Pedro, Los Angeles & Salt Lake Road
was projected as an independent line by w. ~
Clark ard his associates to run from San Pedro,
10 Salt Lake City. having connection at that
point with the Union Pacific and with the Gould
system. After the work Of construction in
progress the parties In control of the Union Pa
cffc. by OF harassins litigation designed
to prevent the acquisition OF necessary rights OF
way. and by threats of paralleling the line II
to render the same unPrOfit
able. and by other means. induced Clark and
his associates to abandon the scheme OF an IN
dependent road and to join with the Oregon
Short Line taking over certain track owned
controlled by that company in Southern Utah
and Eastern Nevada. and giving 10 the Oregon
Short Line an equal stock interest in the San
Pedro. Los Angeles & Salt Lake Road with that
traffic agreements and other contracts We're
made between the San Pedro and various
DoratiOns included in the Hartman system ss
allied which depriveS the San Pedro of its in
dependence and makes il in effect DsEt 0s tea
anne system
CONTROL OF SANTA F'E-
As to the Santa Fe. which is a competing line
With be IN the Union Pacific and Southern Paei-
c it appears that Mr. Hartman and his asso-
iates acquired sufficient interest in the Santa
e that two members of the Union Pacific
oard-tO wit MessrS- Frick and Rogers-be-
anne and still directors of the Santa Ee,
nd the Union Pacific as corporation. pur-
hased and still holds large block of santa Re
took As the result of the close union between
.lsse lines competition has to a large extent
cen destroyed. The Oregon Short Line is also
holder Of large amounts OF stock OF the North
rn Pacific. and Great Northern railway COM
anieS.
In pursuance of the plans of Mr.. Hartman
nd his associates for acquiring control of trans
traffic the Union Pacific in 1901
m Pacific Railway Company. which later
lrned over 10 the Northern Securities Company.
Then il was held by the Supreme Court of the
nited states that il was Illegal for the latter
to hold the stocks OF the Great
orthern and Northern Pacific. distribution
as made among It's shareholders. as result of
hich the Oregon Short Line received from the
orthern Securities Company stocks Of both the
reat Northern and Northern Pacific. The lat
r companies joint owners OF the Chicago.
& Quincy Railroad Company. which
active competitor Of the Union Pacific
rough a large territory. and the Northern
acific and Great Northern likewise COM
,titorS of the Union Pacific
The Attorney General has engaged as special
;sistants for the purposes of this litigation
rank B. Kellogg and Cordenio A Severance OF
/ Paul. who acted counsel for the Inter-
ate Commerce Commission in the investigation
ferrsd to-
POSSIBLE RESULTS OF SUIT
1,era - ,onsider ,Ie 5i,-erpenre ,s oniz,ioY -.