Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1912-12-03
COURT SHASHES
The UP MH8GEo
SUPREME COURT HOLDS UNION
PACIFIC MERGER BREAKS
THE LAW.
EXTENDS The Sherman Law
Declared II "A Violation of the law
for one Road 10 Acquire Con-
trol of Another.

WASHINGTON, Dec. 2,-The grear
Hartman merger created when the
Union Pacific railroad company
bought 4G per cent Of the stock OF
the Southern Pacific railway system,
was split asunder today by the su.
preme court of the United States as
a violation of the Sherman antitrust
Jaw. Then with the end Of the mere-
er before it, the court sent forth ifs
declaration that while the law may
not be able to enforce competition, II
can reach combinations which rend'
er competition impracticable."
Justice Day announced the unanl-
nous. opinion OF the court Justice
Van Deventer took no part in the CON
sideration OF the case today but his
personal finding when he was judge
of the Utah circuit court, to the er-
feet that the two roads were not com
petitors and therefore no violation III
the law had resulted from the pur-
chase, was reversed and annulled. IN
Sttdu Ol lOhbNiIi6 liit iN''otA''9
Justice Van Deventer, In the court be.
low, the court in substance approved
the minority holding of Judge Hook
that the roads were competitors ana
that 1t was just as much violation
Of the law for one road to buy the
controlling stock OF a competitor as
ii was for n holding company, as IN
the controlling stock of two Compel
ing companies. AS the Northern Sc
urlties company plan failed nearly ton
years ago, so the Hartman plan fei'
today.
May Appoint Receivers.
The circuit court for the district Il
Utah, was directed to supervise the
separation Of the two great roads ~
ter hearings and in emergency to a2-
point a receiver to sell the stock.
The Union Pacific, if the circuit court
sees proper, may retain control OF the
old Central Pacific line from Ogden
to San Francisco. The decision "t
the lower court, that there was no
violation of the law in the attempt
to acquire the then Pacific stock ana
he stock Of the Atchison, Topeka ana
Santa Fe railway company, Afterwards
abandoned and a certain intertst n
the San Pedro, Los Angeles and Salt
Lake railroad company. was allowe1
to stand.
II is the general belief here that
the application of the decision to 'he
railroad situation of the country VIII
be widespread, placing powerful
precedent in the hands of the attor-
ney general to prevent consolidation
of competing roads.
Department of Justice officials
however, were not prepared tonlEht
10 discuss the full effect OF the deci-
son. Attorney General Wtckersham
elated over the outcome, Issued
statement in which he simply deciar-
ed that the case extended principles
of the Northern Securities case and
reaffirmed those of the Standard on
and st. Louis Terminal association
cases.
Based on standard Case.
Justice Day in his opinion first
dealt with the law in the case. tie
spoke Of the Standard OIL and ToDac-
co cases of last year as the final ant
thority on the Interpretation OF the
Sherman antitrust act. lie pointed
to the decisions of the Standard Oh
and Tobacco cases as being approv-
ed In those cases and then proceeded
to apply to this merger the principles
discussed in all those decisions.
I'VE take 1t, therefore" he said in
this connection, that 1t may be re-
garded as settled that combination
which places railroads engaged in IN |
terstate commerce in such relation as
to create a single dominating control
in one corporation whereby nature
and existing competition in interstate
commerce is unduly restricted or sup
pressed Is within the condemnation OF
the act While the law may not he
able to enforce competition, 1t can
reach combinations which render |
combination impracticable.
"Nor do we think it can make any
difference that instead Of resorting TO |
a holding company as was done IN
the Northern SeCurities case, the con- |
trolling interest in the stock of one
corporation is transferred TO the 9th
er. The nomination and control and |
the power TO suppress competition
are acquired in the case no less than
in the other and the resulting mis-
chief at which the statute was alu- /
ed is equally effective Whichever
form is adoted.'
lie added that more effectual |
form of combination to gain the con
troll Of a competing railroad than for
one road to acquire a dominating STICK
interest in the other could hardly |
be conceived.
one by one justice Day took up fhe |
arguments upon which the railways |
hoped to defeat the governments
suit. He first considered the argn |