The Barre daily times. (Barre, Vt.) 1897-1959, 1912-12-02
Gets Decision in Famous Union
Pacific Merger Case
BEFORE u. S. SUPREME COURT
End Brought About To-day to Impor.
tant Action Which Was Begun in
1908 to Dissolve the Harri-
man Combination.

Washington. D. C., Dec. 2-The United
1 States supreme court to-day declared
in favor of the federal government il
the Union Pacific merger case.
The governments fight against the
Union Pacific merger began in 1905. In
that year Attorney-Gener Bonaparte
! filed in the United States circuit court
for Utah a petition to split the trans
continental railroads brought together
by Edward II. Hartman. This powerful
combination was alleged to be in viola
tion of the Sherman antitrust law
Hartman, Jacob II. Schiff. Otto lf.
Kahn, James Stillman, Henry H. Rogers,
Henry c. Frick and William A. Clark
were named by the government as the
creators OF the combination and the sup
porters of IFS existence. The allegations
set forth in the petition stretched over
the development of the entire nation and
went far into the years of the past. Cir
cult Court Judges Sanborn, Van Devan-
ter, Hook and Adams were called to pass
on the suit.
The governments case was built large.
ly around the purchase by the Union
Pacific Railroad company in 1901 and
1902 of 40 per cent. of the stock of the
Southern Pacific company referred to
as ordinarily controlling interest. The
main line of the Union Pacific extended
from Kansas City and Omaha to Ogden.
BY subsidiary companies. it reached to
Portland, Oregon, and thence, by steam
ers, San Francisco and the orient The
Southern Pacific had line by sea and
land from New York to San Francisco
and Portland by way of New Orleans,
and owned the Central Pacific, extend
ing from the terminus of the Union Pa
cific at Ogden TO San Francisco.
Two weighty questions were presented
by this phase OF the case. The first was
a question of law: Does the purchase
outright by one railroad company of the
controlling corporate stock of another
result in combination in violation OF
the Sherman antitrust law No case
had arisen which decided the
point Judge Hook reached the conclu,
sion that since it had been decided in
the Northern Securities case that the
holding OF the stock Of two companies
BY third was a violation of the law, |
the holding by one of those
two OF the stock of the other must like |
wise be a violation But Judges Adams, |
Van Devanter and Sanborn did not pass
On this question because they decided |
the case against the government on the |
second question.
The second question was whether the /
Union Pacific and the Southern Pacific
we're competitors for San Francisco
business. The government presented
witnesses to show the two companies
before the merger maintained rival So /
letting agents in the East and that they
we're commercially regarded as competi
ors for transcontinental business. The
ourt reached the conclusion that the
question of whether they were competi-
ors was not to be decided entirely as
matter of fact governed by testimony
MT was partially a question Of law.
Is matter of law, il was held that
he two could not be competitors be-
ause the Union Pacific had to depend
pon the Southern Pacific to get from
,gden to San Francisco and upon
railroads to bring freight
nd passengers from the East to it at
.ansas CITY and Omaha. In so finding, +,
he court concluded the Union pacific's ,
ne from Ogden through Portland to ,
an Francisco was impractieable. /,
The government also complained that /
he two systems, the Union Pacific and 1,
he Southern Pacific, were competitors :
lr business from Atlantic seaboard and !
lterior poin.s of the country on the :
ne hand to Portland. Oregon, on the !
ther; between the Atlantic scaboard ;
n the one hand and Colorado and Utah Z
,mmon points on the other: between !
ortland on the one hand and Utah, !,
olorado and Nevada common points ou :
he other; between San Francisco on
ne hand and Portland on the other; 7
tween San Francisco on the one hand h
I'd Montana and Idaho common points
/ the other: between New York aad J,
terror common points on the one hand Il
nd the orient on the other
Another complaint was addressed to A.
e construction of the San Pedro Los :
ngeles & Salt Lake Railroad company !,
efendant Clark and his associates =
arted to build road to connect Los a
ngeles and Salt Lake City and so did Il
e Union Pacific Because of the al !,
ged impracticability of constructing ~
20 lines through the canyon known as =
Ieadow Valley WASH one road was N.
tilt. the court found. each group of ,c
omoters taking one-half the stock. The IN
tire court found nothing violative of h,
e sherman antitrust law in the Union ~
Icifie's control Of this road. m
The government complained of the m
rchase by the Union Pacific Of con iur
bling stock in the Northern Pacific in
mpany. The court declared il was he
" necessary to say the Union Pacific
4 sold that stock
Still another complaint was the pur-
sse in 1904 by Defendants Hartman. A,
gers. Stillman, Schiff. Kahn and VII
m Rockefeller of s30OOOO00 in face
hue Of the stock of the Atchison, To-
"A and Santa Fe Railway company tn
1 the investment in 1906 by the Union BY
cidc in ) per cent of that stock. The be
lrt found no proof that any control pc
: thus obtained over the rival Santa eri
Thus defeated IN the circuit court. the vi
rernment brought the case to the ed
IRENE court. Attorney General Wick he.
ham, Frank y. Kellogg and Cordenio
Severance appeared for the govern wa
nt A long list Of attorneys headed no