The citizen. (Honesdale, Pa.) 1908-1914, 1909-05-05
Government Is Beaten on
Commodities Clause.
HEPBURN LAW CLAUSE NULUFIED
Contention of United States That It
Applies to Ownership of Stock
Is Declared Un-
tenable.

Washington, May At has been
many day since Il decision of the su-
preme court of the United States has
been received with so much interest
as was manifested in the decision of
that court 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 fa-
vorably to the railroads in that the
clause Of the Hepburn rate law which
prohibits interstate railroads from car
rying commodities manufactured, min
ed or produced directly or indirectly
by the roads was declared unconstitu-
tional, and the general impression had
been that the decision would be af-
f1rmed by the supreme court
Justice Whites decision is that con-
gress did not transcend it's constitu-
tional authority in the enactment of
the commodities provision; but, on the
other hand. 1t was held that the gov
ernment's construction Of the proyi-
sion had been entirely too comprehen-
stve.
AS construed by the court the sole
object Of the clause is to prevent car
rfers from being associated in interest
with the commodities transported at
the time Of transportation; hence that
the law only prohibits the transporta-
ton 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 COM
modify to be transported and when
the company has an interest, direct 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 a producing
company, but that a carrier may own
stock in such company and at the
same time transport the product of
that company.
Summed up, the act only, compels
companies to dissociate themselves
from the products they carry, and the
contention of the government that the
law applies to ownership of stock and
prohibits the transportation of COM
modities simply because they have
been produced by railroad company
regardless of the fact that the COM
pany has parted with them Is untena-
bic and incapable of enforcement.
1t thus appears. first. that the COM
modities clause is vital and opera
tive statute with respect to all prod
TctC Sunh iob h.
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 compa-
MES.
The effect Of the decision under ex-
listing conditions is favorable to the
railroads. and the government lost on
practically every point except the sus-
tention OF the principle involved.
Attorney General Wickersham made
the following statement interpreting
the decision as he understands it:
"Mr. Justice Whites statement in
announcing the opinion of the supreme
court in the commodities clause is In
erect That a proper construction of
the so called commodities clause ia
that 1t prohibits the transportation by
railroad companies only of commodi-
ties owned in whole or in na ri NV such
companies at the time Of transporta-
tion and that it does not prohibit them
from transporting commodities manu-
factured, mined or produced by them
previous tC such transportation which
are not owned by them at the time Of
transportation and, further, that It
does not apply to transportation of
commodities owned by other corpora
tions In which the transporting rail-
road company has a stock interest.
THE decision does not sustain the
full contention of either the govern
ment or the carriers. 1t adopts a con-
structlon of the statute different from
that contended for by both the govern
ment and the carriers. It, however,
Sustains the principle contended for
by the government that congress has
power to prohibit a carrier from car
rying in competition with other ship
pers commodities which the carrier
owns or in which 1t is interested.
at operates at once to prevent any
carrier from transporting any CON-
n"hitv which II owns at the momant