The New York herald., 1921-10-07

ers, as well as those OF the owners OF
bonds issued under the general con-
solidated mortgage. This plan leaves
the Lehigh Valley Coal Sales Company
in position to negotiate a new contract
with the mining companies. 1t will be
noted that this plan calls for no as
sessment from the stockholders and re-
suits in no sacrifice of their equity In
the coal company investment"
Petition of U. 8. Government.
The petition Of the Government satd
in part:
"First-Defendants' plan for the seq
regation of Lehigh Valley Railroad
Company and Lehigh Valley Coal Com
pany does not contemplate the disposi-
tion of the stock of the coal company,
or the railroad company's equity there
In. to persons not connected with or
interested in the railroad company, but
merely provides for the distribution 0f
certificates of interest representing the
railroad company's equity In said stock
to the stockholders of the railroad COM
pany, thus leaving the two corporations
In substantially the same situation in
which they now are, namely. under the
ownership and control OF identically the
same set of stockholders. Petitioner
AYERS that in the case of United States
VS.. Union Pacific Railroad Company ct
al, 226 u. 8. 470. the Supreme Court in
providing for the segregation of the
Union Pacific and the Southern Pacific
held that 1t would not be a compliance
with the antitrust act for the Union
Pacific merely to distribute the stock OF
the Southern Pacific to its stockholders (;
and that the doctrine laid down in that
case to the effect that In dissoiving un-
ln trrfs ~ t. 1xID =.
antitrust act the several parts into
which the combination Is divided shall
bc placed under independent ownership.
management and control has been fol-
lowed In all subsequent cases and should
be followed in the present case.
"Second--As regards the proposal to
place Lehigh Valley Railroad Company's 8
equity in the stock of Coke Bros. & Co.,
Inc. in the hands of trustee or trus-
tees until the maturity of the collateral
trust agreement In 1926. and then to dis
pose of such stock to persona or corpo-
rations who are not stockholders of any
OF the corporate defendants, petitioner
suggests to the court that such proposal
is not a plan for the sale or disposition
by Lehigh Valley Railroad Of It's inter-
est in Coke Bros. & Co., Inc. as con-
templated by the mandate Of the Su-
preme Court, but Is merely q proposal
to extend for a period Of more than four
years the time In which defendants shall
comply with said mandate. II, however.
this court shall be of opinion that the
proposed trusteeing OF Lehigh Valley
Railroad Company's equity in the stock
OF Coke Bros. & Co. Inc, will constitute
disposition OF such stock within the
meaning of the mandate of the Supreme
Court, petitioner will not object thereto.
'Third-Petitioner makes the same
suggestion in reference to the proposal
to trustee Lehigh Valley Railroads
equity in the stock OF the Delaware.
Susquehanna and Schuylkill Railroad
that 1t makes in reference to the pro-
posal to trustee the stock OF Coke Bros.
& Co, Inc. Az regards the proposal
that Lehigh Valley Railroad Company
will at once apply to the Interstate Com
merce Commission for authority to con-
solidate the property OF the Delaware.
Susquehanna and Schuylkill Railroad
Company under the provisions OF the
act to regulate commerce. petitioner
AYERS that after the Supreme Court had
fled its opinion in this case, and before
the mandate had been sent down, de-
fendants applied to that court for a
modification Of the mandate which would
authorize Lehigh Valley Railroad Com
pany to follow the course which II now
proposes, and that although the petition
for modification was not opposed by the
United States. 1t was denied by the Su-
preme Court"