The San Juan islander. [volume] (Friday Harbor, Wash.) 1898-1914, 1911-06-30
HARTMAN MERGER
IS UPHELD
ma, CIRCUIT COURT DE-
cLAREs LAWFUL METHODS
WE'RE FOLLOWED
oo,ds Were Not Actual Com
.;,ors-NegIect to Secure Santa
Fe Affords Proof of Indifference TO
.,ol of misunderstanding Opin-
Is Filed.

=. Louis, June 26.-The govern
,,s netition to enjoin the Union
n.oisc railroad continuing to control
ro southern Pacific railroad was dis
,,sod by the United States circuit
r+ of the eighth district. Judge
r,nor B. Adams wrote the majority
;nion which was concurred in by
Y,doo sanborn and former Judge, now
c,nrome Court Justice Vandevanter.
T,1no William C. Hook wrote a dis
senting opinion.
rho decree was entered at Salt Lake
o., where the suit was filed in Feb
o snorv 1908. and the opinions handed
aawn in st. Paul, Salt Lake City and
here.
norger engineered by the late E. H.
uorriman and his associates in 1901
and subsequently, did not amount to a
diroct and substantial restraint OF
trade interstate or international.
Standard Oil Case Cited.
He found that the suppression of
comnetition between the Union Pacific
and the Southern Pacific was so infini-
tosimallv small that it was unimport-
ont In connection with this feature
Of the decision, Judge Adams cited the
recent Standard Oil decision, in which
the rule of reason was first laid down
nv the United States supreme court.
Judge Hook, in his dissenting opin-
ion said the majority opinion so
greatly narrows the act of congress
that very little is left of it when ap-
nlied to railroads." and that under the
tests which the majority opinion was
based on 1.-The Union Pacific could
thereby have lawfully purchased con-
troll of all the great railway systems
in the United States"
Judge Adams prefaced his opinion
with the statement that the govern
ment must prove that the restraint in
trade alleged in the bill was substan-
tial in character as the direct and i'm
mediate effect of the combination. The
government, he said later, failed to
prove this.
Competition Not Destroyed.
The court holds that while the
Union Pacific was entirely dependent
upon the Southern Pacific for it's con-
nection westward, the Southern Pa
cifc was not at all dependent upon the
Union Pacific for it's connection east
ward" read the majority opinion.
Cur conclusion" continued the
opinion, lis that all the facts of this
case considered in their natural, rea-
sonable and practical aspect and given
their appropriate relative significance,
do not make the Union Pacific a SUBJ
stantial competitor for transcontinen-
tai business with the Southern Pacific
in or prior to the year 1901.
I'VE therefore pass to cOnsidera-
ton of some less important matters
relied upon by the government to
establish destruction of competition
between these companies.
Judge Hook, in his dissenting opin-
ION, refers to the governments com
plant of unlawful contract in restraint
of trade between the Southern Pacific
and the Union Pacific railroads, thus
destroying or suppressing competition
He says the combination was effected
by the purchase by the Union Pacific
OF part of the stock of the Southern
Pacific railroad. Judge Hook says
there is no substantial difference be
tween The holding of the corporate
stocks of two companies by third
such as was condemned in the North
ern Securities case, and the holding
by one of those two in the stock Of
another.
Substance Sacrificed, Says Hook.
1T would be idle to hold that while
TWO competing railroad companies can
not lawfully submit to a common con
troll through separate stockholdins
organization, they may do so by dis
pensing with that medium. Tha
would be regarding shadows and let
ting the substance go. The language
OF the Sherman act in this particular
is broad"
Judge Hook comedies with the ma
1ority of the court in regard to thu
JOINT ownership of the Los Angeles &
San Pedro road.
Judge Hook holds that the question
as to whether the Union Pacific ant
the Southern Pacific roads were com
petltors, which the majority opinion
decided against the government, wa
question of fact to be decided by tn
testimony of many expert witnesses
and these witnesses, Judge Hool
nolds, gave conclusive testimony tina
there was active, vigorous and sui
stantial competition"