The evening world. [volume] (New York, N.Y.) 1887-1931, 1913-02-14
HARD COAL TRUST
ATTACKED IN SUIT
BY GOVERNMENT
l1ckaWanna Road and Coal
Company Made Defendants
in Injunction Action.
UNDER SHERMAN LAW.
Test Also TO Be Made of the
/ Commodities Clause
Application.


aotion has been begun here against
the Delaware, Lackawanna and West
en- Railroad Company and the coni
company OF the same name for ailegco
violations OF the Sherman Antitrust
law and OF the commodities clause u
the Interstate Commerce act. This 10
test case against the so-ca'led HArd
Coal Trust. The result will affect not
only the defendants but also the Read
ing, Jersey Central, Lehtgh Valley. Erie.
susquehanna and Western, Pennsylva-
mia, Delaware and Hudson and Ontario
and Western companies. which control
practically all OF the annual output OF
100000 tons Of coal produced In the
anthracite fields.
Application In now made TO the United
States District Court TO enJoin the rail-
road company from transporting coal
mined or brought by II under agree
,nsnts between the defendant corpora
tionS, which are alleged TO have COM
mon stock olders. which constitute q
monopoly In an output Of from 100000
to 9ooO. 900 tons annually and which. In
combination with other companies. re-
and by making and controlling {. o. b.
terminal prices. a bureau OF statistics
u alleged 70 be maintained by the rail-
road and the affiliated coal companies
for the Information and guidance OF "a
concerned.
The prosecution alleges that the pres
snt defendants got around the commodi.
ties clause decision OF the Supreme
Courts decision in 1909 by the device OF
nifty per cent. dividend by the railrDad
company. which enabled its stockhold-
srs to acquire the stock Of the new coal
ceiling company.
TURNED BACK FOR INTER.
sTATE TRAFFIC.
These two concerns are charged with
having then entered into a contract by
which the railroad sells to the Goa,
company annually 100000 tons produced
IN tho railnoad mines and .60o.00 tons
bought outside. After taking ostensibie
possession OF the coal the buyer then
bills Il over to the railroad for inter-
state transportation.
It II alleged that at least IS per cent.
Of the shares Of both companies are IN
the hands Of common tockholders. that
twenty-five stockholders own a majority
Of stock In both companies. and the at
fairs Of both are controlled by a still
smaller number acting IN concert. The
coal com pany u aaid to have paid div!-
dends At the rate OF 10 per cent. per
year. and In less than three years to
have declared q surplus Of more than
- Per cent
Announcement 10 made that the rea-
aon the Government recently requested
end obtained the dismissal Of the suit
Under the commodities clause against
the Lshigh Valley was TO gain time to
consider the sdvlsability Of proceeding
against the company under. both the
commodities clause and the Antitrust
law. The Supreme Court. In It's decision
IN the general Hard Coal Trust suit
threw out without prejudice the charges
OF combinations OF coa!-carrying rail-
roads and coal companies for the same
purpose. namely, to enable the Govern
msnt TO prepare itself Oh that distinct
Issue. The present action puts the IN
ishing touch on that programme.
James &. McReynolds ana q. Carroll
Todd. retained as special assistants. pre-
pared the present case which, they say,
Will determine II corporation may
escape by contract the prohibitions OF
the commodities clause. while retaining
for itsek all the benefits Of the old ar
rangsment; and II the Sherman Law ca n
b applied to restrict railroads 10 the
functions and obligations OF common
carriers.