New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-05-28

make contracts Nth independent operators
for their entire output
In connection with IN. purchase Oh Co ',s1
from the independent operators mere came
into existence what Is known a. the per
rcntaer contracts" The Lchigh valley
coal COMPANY regularly for PERIOD "'
Years entered into these contracts WIN III
dcnepdcnt coal GENERATORS. Under these con-
tracts the company agreed TO pay the N
dependent operators huctudtlnS plC'S, ~,
their coal at the mines, 10 Pc ARM - az
an tho basis of certain percentages OF inc
average market prices OF IN NaiLoG ta
grades Of coal az udcWdtcL. Al az ~,
check was kept on the udewater marker
,u,ices and monthly settlements we're mac
Under the contract. which was III eHrot
the greater part of 1900, the agreement y!
the Iehich Valley Coal Company Nds l"
nay the coal operator 90 per cent OF lhc
iidewater price on the highest grade OF
anthracite coal aud lesser pcIC'H'dTeS O''
the lower grades. r,;,.l
Company was not uomnally party 10 any
Of tho percentage contracts entered mo y.
the Lchigh VALLEY Coal ConpdHE, fEgSicht
charges on coal purchased ana shipped og
the I,ehigh Valley Coal company az u!o
differences between the amounts pau ,,o ~
tho coal operators and the average MAJ he'
r,ri,es At tideWatcr. The result Was TAX
inc the highest grade Of coal as an lIu G,t,
lion, that il the Lehigh valley ,oaI o nn,
nan, paid AN independent generator =" PSi
cent of the tidewater price the l'ehlGh VA,
lev Railroad Company Transported I ilc 'o 10
for 40 pcT cent Of the tid"Waiet ~ H. w., tow
will thus be seen that although ,nC nc 49,,
~ freight rates was not mcnuOneI III w,
contracts made by the Lehlgh Nd,lrG &c GO
COMPANY with the independent oP Sancnd.
vet the freight rates were dlI'cI'E "'P'''
.ent upon the contracts.
Shows Monopoly Extortion'
\ change in the terms Of the 60 per
cent contract was made on August :,
1901. when il was determined that a -
per cent basis should govern, retroactive
Is, to November /, 1900. the extra cost
of the coal on this basis to be paid by
the Lehigh Valley Coal Company TO the
coal operators. 1t was in this change
that Meeker d co. claimed there was
discrimination, the complainant contend
ing that tho payment Of the increased
retroactive prices to the coal producers
by the Lehish Valley Coal Company was
ia fact d payment by the railroad com
psny.
Investigation of the books of the RAJ
road company disclosed the fact that
subsequent TO August J. 1901, there were
extraordinary cash advances made by
that company to the Lehigh Valley Coal
'
company owed the railroad company ST.
52G 65O at the end of the year November
60 1895. ana that a year later the in
dcbtcdncss remained unchanged. How
ever, there was Il strike, production was
Curtailcd and the Indebtedness was re-
dntcd 10 about SJ0OO0O during the FOL.
lowing year.
Concluding his opinion. or decision,
Commissioner McChord says:
/, requires mo extended argument 10 sus-
tam the proposition that Tho maintenance
al an unusually high rate operates to the
adv snjaco Of the lehiGh Valley Railroad
Company q dealer I'm coal Tn" record
shows that the only hnc of dcmarcation BE-
tween tho railroad company ana the coal
company t. bookkeeping.
Assuming Tor tho purposes Of illustration
that the cost OF mining anthracite coal IS
8 per ION and ;ho cost OF carving ~ 70
tideVator is = pcr ton. II follow tat IN"
cost Of coal At tidewater would he 8 per
ton. and Il tho published rat" wer" 81 IN"
iUdeuordent operator and tho railroad com
Cany would ue on q fair competitive basis
So far ~ the cost Of mining and transport
istou is concerned
rut lc between the railroad company and
its coal company II matters not whether
tne Urprt comes from. mining or transport
ing the coal u is obvious thst such an
ADVANTAGE would enable the railroad COM
pany and it's alter ego. the coal company,
70 monopolize the coal field served by il.
As an example Of tho monopoly Com
missioner McChord sets forth
In 1901 s. per cent Of the defendants
coal tonnage 10 Perth Amboy was con-
trolled ny u and 53 per cent by the indie
pendent operators, while in l90S the de-
PENDANT controlled % per cent Of the
anthracite tonnage over defendants line
80 Perth Ambov and the Independent
operators =. per cent. During the same
period the compliments shipments to
Perth Amboy decreased from 1851
tons for 1901 20 1856 tons for 1905