Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1912-12-05
HISTORY OF THE CASE.
Governments Fight against Merger
Was Degun In 1908.

Washington, Dec. H.-Inc government
fight against the Union Pacific merger be-
gan in 1908. In that year AttorneyGen-
eral Bonaparte filed in the United States
circuit court for Utah a petition to split
the transcont.nental railroads brought to-
gether by Edward H. Hartman. This
powerful combination was alleged to be
in violation of the sherman antitrust
law.
Hartman, Jacob II. Schlf, Otto II.
Kahn, James Stilman. Henry II. Rogers.
Henry G. FrclI and William A. Clark
were named by the government as the
creators of the combination ard the sup
porters of It's 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
cuit Court Judges Sanborn. Vandevanter,
Hook and Adams were called to pass on
the suit.
The governments case was built large
~ around the purchase by the Union Pa
cihc Railroad company in 1901 and 1902
| of 4G per cent. of the stock OF the South
| crn Pacific company referred to as ordi-
narily controlling interest. The main
| line Of the Union Pacific extended from
Kansas City and Omaha to Ogden. By
subsidiary companies, it reached Port
| land Oregon, and thence by steamers.
San Francisco and the Orient. The South
| ern Pacific had a line by sea and land
from New York to San Francisco and
| Portland by way OF New Orleans. and
owned the Central Pacific extending from
| the terminus of the Union Pacific at
Ogden to San Francisco.
TWO WEIGHTY QUESTIONS.
| 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 a combination in violation OF
the Sherman antitrust law? No case
seemingly had arisen which decided the
point Judge Hook reached the conclus-
ion that since 1t had been decided In
the Northern Securities case that the
holding of the stock Of two companies
by third was violation Of the law
therefore the holding by one Of those
two of the stock OF the other must like
wise be violation. But Judges Adams
Van Devanter and Sanborn did not pass
on this question because they decided the
| CtiSe against tHe oh VIC ScS'
Ond question.
The second question was whether the
Union Pacific ana the Southern Pacific
were competitors for San Francisco
business The government presented
witnesses to show the two companies
before the merger maintained riva
soliciting agents In the East and tina
they were commercially regar led Al
competitors for transcOntinental bust
ness, The court reached tho conclu
rion that the question Of whether the!
were competitors was not to ba de
cided entirely as a matter Of fact gov
erned by testimony, but was partian'
! . question 81 law. As . matter OF Law
II was held that the tive csuld net D
eoNpstiters because the Uhisn PaeiA
! had to asPsRa upon the GsuthO1 ~
cife to get from ogden to ess yrsa
cisco and upon indspsaGsnt ystlrseA
to bring freight ana pssssAgsY freu
the East to Il at Kansas CITY a.
Omaha. In 80 finding, the court con
cluded the Union Paciflc's line from
lOgden through Portland to San Fran
kcisco was imDracticablA