The Birmingham age-herald., 1913-03-16
ABANDON SECOND
PLAN D|SSOLV|NG
RAILROAD MERGER
Action Is Caused by Objec.
tiOn From the CalifOr-
MIA Railroad Com
mission

ST Louis, March 15.-The Union Pacific
and Southern Pacific dissolution plan,
which contemplated a traffic agreement
between the two roads for the use of the
Benicia short line between Oakland and
Sacramento to California was abandoned
in the federal court today by the railroad
officers. 1t now devolves on the railway
attorneys to devise a new arrangement
of the United States supreme court
The dissolution decree, which was cer-
titled to the district court of Utah on
February 10, gave the railroads three
months to submit satisfactory plan to
the lower court.
No date was set by the judges of the
Eighth federal circuit. sitting as the dis
trict court of Utah, today, for the rehear-
ing of the case. but it is expected new
plan will be laid before the court some
time in April. What arrangement the
railway companies. contemplate was not
indicated by Chairman Robert S. Lovett
of the Union Pacific system, who an
nounced abandonment of the second plan
in court today.
Mr.. Lovett and other officers and at
torneys of the Hartman lines left St.
Louis for the east on a special train this
afternoon. United States District Attor-
ney Houts, who represented the Attorney
General in the proceedings today, has no
information as to the further course con-
templated by the railway representatives.
Was Second Plan Drafted
The arrangement which was abandoned
today was the second plan drafted by the
railway attorneys in an attempt to COM
ply with the dissolution decree
The first plan submitted to the circuit
judges on February "a, was modified be-
cause the California railway commission
objected to clause providing for lease
of the Southern Pacific short line from
Oakland to Sacramento to the Central Pa
clfic, which in turn was to be taken
over by the Union Pacific. The Cali
fornia commission held that there should
be no exclusive use of the short line
by the two Hartman roads.
The modified plan, abandoned today,
provided for u traffic agreement between
the Southern Pacific and the Union Pa
cific for the use of the short line instead
of lease.
The abandonment of this plan came as
a surprise as Mr.. Lovett and his assist
ants came here expecting to present the
new dissolution arrangement to the CIR
cult judges Tor approval.
After his arrival in St. Louis, Chairman
Lovett received copy of the protest
against the new plan filed by the Cali
fornia railioad commission with the At
torney General.
Asserting that the approval of the Cali
fornio commission was necessary to vail
date the proposed lease of the Central
Pacific by the Union Pacific, which In
turn was necessary to satisfy certain
French banking interests, Mr.. Eovett an
nounced that the Union Pacific could not
go eli with the, plan. He asked the court
to leave tie final dissolution decree in
allegiance.
Chain man 1-ovett in his address to the
coura'did not mention the guarantee which
the t'nion Pacific had gwen Kuhn Il
Co., the LanSing firm which was to
handle the stock distribution features OF
the dissolution. but 1t is said tat by
the collapse of the plan the Un.-.l Pa
cific forfeits more than a million dollars
commission TO the banking syndicate.