The Washington herald., 1912-12-03
UNION PACIFIC
STOCK CONTROL
HELD ILLEGAL
Continued from Page one.

court VIII permit the presentation VI a
plan whereby the Union Pacific may OBJ
tain the control of Central Pacific, but
the government or any party in interest
may present a plan for preventing the
retention of Central Pacific"
Well Street received the decision with
agitation For a time stocks slumped
badly. and then acting Just as they did
In the Northern Securities case, they
came back without serious loss in the
stocks especially affected by the decision:
nothing more than a very inconsequential
days decline. 81 or a point in Southern
Pacific; barely 3-s of a point on Union
Pacific.
Always looking on the bright side, the
gossips quickly began TO figure out just
where the benefits might accrue TO the
involved roads.
Southern Pacific Benefited.
Southern Pacific was accredited with
being fortunate in that the great system
freed from the chilling. narrowing touch
of Union Pacific bossism, would be able
to spread out to good results. That its
$500 O0O. 900 oil lands would certainly make
the price higher and II would still have
the right TO accept and give passengers
from and to the Union Pacific system,
while the only additional expense that
could be charged to the operation of the
road was the Official stan.
Union Pacific shareholders found cause
for congratulation in the size OF the
rIpening melon" to be harvested when
the $126.65O.OOO Southern Pacific stock is
sold. This money must be distributed
to shareholders and II will make such
a large amount that ii will bring this
favorite speculative security down ma
teriaily in share value and make IL
even more popular as a speculative IA
vorite than II Is to-day.
Union Pacific preferred stock rose 81
points. following the decision. showing
that there would be no question as to
the standing OF the preferred shares.
Decision Far-reachinE.
Should the Union Pacific fail in its
efforts to retain Central Pacific. it
would be a severe blow to the system.
as 1t would then make Ogden as the
terminus of the Western line, but il
still maintains its grasp on the Salt
Lake line.
Attorney General wickersham declares
that the decision, which was prepared
and read by Justice Day. all concurring,
is lone Of the most far-reaching de-
cisions ever prepared"
Many New York financial men were
lined up as defendants, including Schiff.
Kuhn, Loeb & Co., James Stillman. Hen
~ c. Prick, William a. Clark, and E.
II. Hartman and H. H. Rogers. de-
ceased. The several railroads and the
Farmers Trust Company of New York
also were defendants.
In announcing the opinion Justice Day
said:
This court reaches the decision that
the Union Pacific and Southern Pacific
systems. prior to the stock purchase.
were competitors engaged in interstate
commerce, acting independently as to
a large amount OF such carrying trade.
and that since the acquisition OF the
stock in question the dominating power
of the Union Pacific has suppressed COM
petition between the systems, and has
effected a combination in restraint OF
Interstate commerce within the prohibi-
tons Of the act.
Violation of Law.
I'm order to enforce the statute the
court is required to forbid the doing in
the future OF acts like those which are
found to have been done in violation
thereof and to enter a decree which will
efrectually dissolve the combination found
to exist in violation OF the statute.
The decree should provide an injunc-
ton against the right to vote this stock
while in the ownership or control Of the
Union Pacific Company or any corpora
ton owned by It, or while held by any
corporation or person for the Union Pa
cific Company, and forbid any transfer
or disposition thereof in such wise as to
continue its control, and should provide
an injunction against the payment of
dividends upon such stock while thus
held, except to a receiver to be appointed
by the court who shall collect and hold
such dividends undisposed OF by the de-
cree of the court.
"As the court below dismissed the
governments bill, it was unnecessary
there to consider the disposition OF the
shares OF stock acquired by the Union
Pacific Company. which acquisition. we
hold, constituted an unlawful combina-
ton in violation of the antitrust act.
I'm order to effectually conclude the
operating force of the combination such
disposition should be made subject to the
approval and decree of the court. and any
plan for the disposition of this stock !
must be such as to effectually dissolve
the unlawful combination thus created. |
The court shall proceed. upon the pres
entation OF any plan, to hear the gov
eminent and defendants, and may bring
in any additional parties whose presence
may be necessary to a final disposition
of the stock in conformity To the views |
herein expressed.
May submit Plans.
las to the suggestion made at the oral
argument by the Attorney General. in !
response to a query from the court as
to the nature Of the decree, that one |
must be entered which, while destroying |
the unlawful combination insofar as the |
Union Pacific secured control OF the COM |
peting line of road extending from New |
Orleans and Galveston to San Francisco |
and Portland. would permit the Union |
Pacific to retain the Central Pacific con-
nection from Ogden to San Francisco, |
and thereby to control that line TO the |
Coast, thus effecting such a continuity Of |
the Union Pacific and Central Pacific, |
from the Missouri River to San Fran |
cisco, as was contemplated by the acts |
OF Congress, under which they were con- |
structed. Il should be said that nothing |
herein shall be considered as preventing |
the government or any party in interest. |
IL SO desiring, from presenting to the /
court a plan for accomplishing this re-
suit or as preventing the court from |
An "A. a.