Arizona republican., 1913-06-10
Supreme Court Upholds the Power of States to Fix Reasonable Intra s t a te Rates on Int rs a t e Railroads
VALUATION PLAN
 ALSO DETERMINED
Decision is One of the Most Important Ever Rendered and Follows the Filing f Briefs by Every Governor in the Union
IAssocIArED pRKss pIs1AFcHJ

IAssoCIArED PRKss pisHATcH1
 WASHINGTON, June 9.-The power of states to fix reasona ble intrastate rates on interstate railroads until such time as congress shall choose to regu- late these rates was upheld today by the supreme court of the United States in the Minnesota freight and passenger rate case At the same time the court laid down far reaching principles gov s&kning the valuation of railroad prop &f4H for rate making purposes and ac- 'cBf0ng to those held that the state of Minnesota would confiscate the prop erty of the Minneapolis and St. Louis Rai1road- company by its maximum freight and two cent passenger fare law. The court enjoined the state from enforcing these laws as to this road at present.
 In the case of the Northern Pacific and Great Northern, however, it was held that the roads had failed to show the rates were sunreasonable' or con fiscatory'' and consequently reversed the United States district court of Min nesota, which had enjoined their en- forcement as both confiscatory and burden on interstate commerce.
 The decision is regarded as one of the most important ever announced by the court and has been under considefa- tiOn for fourteen months. The railroad commissions from eight states and the governors of all states had filed. briefs in support of their state in the caees. recognizing that the principles fnvulvetE affected all. ss.sxss.v
 The rate cases from MISSOURI
 
 Virginia were not decided today. but the points announced in the Minnesota case were regarded al governing them generally. These probably will be dis posed of tomorrow.
 Criticism of the apportionment of the value between the interstate and intra state bushes on a gross revenue basis and the apportionment of expense by re- garding intra- state business as two and one-half times as expensive as inter state, is considered here as favorable to the state of Missouri in the fight to uphold the validity of the maximum freight and two cent passenger law en- acted by it.
 The states of Oregon and Kentucky are regarded as almost certain to win their cases, involving the validity of state freight rates.
 The decision was announced by Jus tice Hughes. Justice Hughes consid- cred the attack on the states rates in two parts, one that they placed an un- lawful burden on interstate commerce, and the other that they were so low they would confiscate property rail- roads.
 In considering the interstate com merce phase the court took for granted that the state had the power to regu- late rates between points within the stae of Minnesota on roads not cross ing the state lines and so far from the boundaries as not to Scompete with cities of other states or otherwise af- feet, interstate commerce. Next it re- ported the conclusion that intrastate rates, whether of purely intrastate railroads or interstate railroads had not been regarded by the courts as being direct regulation of interstate com merce.
 1 The so- called state rate' cases have presented to the supreme court one of the momentous problems of the decade.
 In general terms, this group of cases called upon the court to decide two questions. One was whether the
 
 and5 2-cent passenger laws had unduly interfered with interstate commerce. l The other was whether those laws confiscated the property of the rail- roads by requiring them to, transact | business at loss.
 The group consisted of forty-five | cases. All arose out of legislation en- acted by state legislatures about 1907. l or just after the federal government had passed the Hepburn rate law. The forty-five cases concerned direct ly the laws in six states, Missouri, Minnesota, Kentucky, Oregon. Arkan = sas and West Virginia, Similar liti- gation arose in Alabama, Iowa, Kan saS, Nebrask Oklahoma and South Dakota. In all, it was said that seV- enty-six suits in federal courts de pended upon the decision in the forty five cases before the supreme court The first of the forty five cases tc reach the supreme court were the Missouri rate cases. In Missouri the lEtghteen railroads crossing the state attacked, in separate suits, the valid ity of state laws fixing the maximum
 rate on freight and limiting passen- ! Continued on Page Two)