The Oskaloosa herald. (Oskaloosa, Mahaska County, Iowa) 1885-1919, 1909-05-06
BOTH SIDES WIN
/ RATE LAW CASE
Supreme Court Decides Commodi.
ties Clause Constitutional.
RAILROADS GAIN BIG POINT
May Own Stock In Subordinate Com
panies But They Must Have
Sold the Freight They
Transport.

washington, May At has been
many a day since a decision Of the
supreme court of the United States
mas been received with SO much in.
terest as was manifested in the deci.
sion OF that court yesterday In what
are Known as the commodities
clause" cases affecting the anthracite
coal-carrying railroads.
These cases had been decided by
the United States circuit court for the
eastern district of Pennsylvania ia,
vorably to the railroads in that the
clause of the Hepburn rate law,
which prohibits interstate railroads
from carrying commodities manufac.
tured. mined or produced directly OF
indirectly by the roads, was declared
unconstitutional and the general i'm.
preston had been that that decision
would be affirmed by the supreme
court. When, therefore, there was a
reversal instead of an affirmation the
interest was much magnified. When
again it was found that the reversal
was based on technical grounds and
that the effect was really favorable to
the railroads, sentiment took another
turn, and those who had been anxious.
ly awaiting the announcement of the
result found themselves much puz
zled
Analysis of Decision.
The courts Judgment was announced
by Justice White. Analyzed, Justice
Whites decision is that congress did
not transcend its constitutional au-
thority in the enactment of the com.
modities provision, but on the other
hand, 1t was held that the govern.
ment's construction of the provision
had been entirely too comprehensive.
As construed by the court, the sole OBJ.
Ject of the clause Is to prevent car
riers from being associated in inter.
est with the commodities transported
at the time of transportation, hence
that the law only prohibits the trans
portation of articles when they have
been produced by railway company
which has not, in good faith, parted
with them, when the company owns
or controls, in whole or in part, the
commodity to be transported, and
when the company has an interest di-
rect or indirect in the commodity in
legal sense. 1t was especially held
however, that the prohibition does not
apply to the ownership of stock in
producing company, but that a carrier
may own stock in such a company,
and at the same time transport the
product of that company.
Must Not Own the Products.
Summed up, the act only compels
companies to associate themselves
from the products they carry, and the
contention of the government that the
law applies to the ownership of stock
and prohibits the transportation of
commodities simply because they have
been produced by the railroad COM
pany, regardless Of the fact that the
company has parted with them, Is I'M
tenable and incapable of enforce
ment.
1t thus appears first that the com.
modities clause is a vital and opera
tive statute with respect to all prod
ucts, such as coal, which the railroad
companies actually own at the time of
transportation. and that the railroads
must sell such products to somebody
else before they can lawfully ship
them, and, second, that unless the act
is promptly amended so as to include
stock ownership, the railroads can es.
cape the law entirely by converting
their direct ownership of coal proper
ties into stock ownership by the or
ganization of subsidiary coal com.
panies.
The effect of the decision under ex-
listing conditions is favorable to the
railroads, and the government lost on
practically all points except in the sus-
tentation of the principle involved.
In holding that congress had not gone
beyond its authority in enacting the
law, the court comedies the right to
legislate and 1t is believed that IL so
disposed, congress might enlarge and
extend the scope of the provision.
No Constitutional Bar.
Hence, while the railroads gain a
practical victory, the government is
not confronted by constitutional bar
from further acting in the direction OF
control of the roads in the matter of
the shipment of their own commodi-
tics.
The decision sustained the provi-
sion of the law exempting timber
from the operations of the clause
This exemption was used as basis
OF attack by the railroads on the law
as discriminatory, but Justice White
refused to accept that view, AS en-
acted, the law did not apply to the
transportation of timber and 1t is OF
course, untouched by the decision.
Western Roads Little Affected.
Chicago, May Awhile the com.
modify clause decision of the supreme
court was received with interest by
railroad officials in Chicago the con-
sensus of opinion seemed to be that
the western lines were not vitality
concerned. The only specific thing
about the decision is the charge to