The Montgomery advertiser., 1909-01-07
TO DISSOLVE MERGER
HEARING or RAILROAD MEN IN
 NEW YORK.
Testimouy in Action Brought by Cove ernment Against the Harrfman
 Combiaation--Witness
 Tell of soufhern Pacific.

New York, Jan. e.--Edwin Hawley. of this city. President of the Iowa Cen tral Railway Company and of the Min neapolis and St Louis Railroad Com pany and a director In several other roads. including the' Southern Pacific, was the first witness called by the gov arnment today in the hearing of the action to dissolve the merger of the Hartman railroads
 Mr. Hawley said he had been in the railroad business for forty years, be- coming connected with the Southern Pacific In 1883.
 MT. Hawley was questioned concern ing rans-continentai business of the Union and Southern Pacific at the time of the alleged merger.
 Mir. Hawley said that he was general Eastern agent of the Southern Pacific at first and that he had jurisdiction over the Morgan Line of steamers which was used as part of the Sunset Route. Competition among the rival rsiiroad companies before the forma- ton of the merger he said was gen. eral. He declared that he always op- posed the consolidation of the com mercial agencies of the Union Pacihc and Southern Pacific railroads.
 On cross examination counsel for the railroads asked Mir. Hawiey If 1t were
 
 Pacific to use the Southern Pacific line in trans-continental trade. Mir. Haw- ley replied that the Union Pacific did use 1t.
 The witness said that 1t was quite possible that If the Union Pacific at- tempted to form an issue with the Southern Pacific. the latter road could divert It's traffic at Portland to the Denver and Rio Grande division. Tn oa afa AA Aa Union Pacific has always been obliged to use the Atchtson, Southern Pacific or the Texas and Pacific.
 In reply to questions as to whether the Southern Pacific was not a domi- nant factor In trans.continental traf- dc and practically had controlled the rates. the witness said that the South ern Pacific was an important factor and that even freight shipped entirely by the way of the Texas and Pacific or Union Pacific had to be turned over to the Southern Pacific. at the terminals. He denied that specific agreements as to rates had been made prier to the merger but said there had been dis- cussions as to the division of rates be- tween the various roads over which it passed. The witness said that freight could be shipped from New York to San Francisco by an all rail route which would avoid the use of the Nor gan line of steamers from New York to New Orleans. The Canadian Pacific tried that, he said. some years ago.
 Henry C. Bly. general agent of the trunk line association for thirty years was the next witness. Counsel for the government asked him to bring in a statement of the tonnage shipped from New York to California and the West in the period between 1888 and 1901 so as to show how much went by rail and how much by steamer.
 Mr. Bly said that "the Morgan Line got mad about something and quit re- porting about 1901"
 Frank M. White, auditor of the di. vision of rates and transportation of thS Interstate Commerce Commission who was the next witness. presented a statement of commodity rates between points east of the Mississippi river and California terminals.
 Mr. Whites statement also showed the rates from New York to San Fran cisco and other California points by way of the Mallory and Morgan lines and the all rail line. Such differences as there were, the witness said. were on insignificant items, leaving room for the inference that q combination as to rates existed between the South ern Pacific and the Union Pacific.
 Attorneys for all parties to the suit agreed to put on the record the tes- timony given by E. H. Hartman be. fore the Interstate Commerce Commits sion and copies of the testimony were put in evidence without reading. This action was believed to indicate that Mfr, Hartman would not be called to the witness stand in the present suit. although counsel for neither side would say positively that Mir. Harriman's presence would not be required.
 The hearing was adjourned until to- morrow.