The Alaska daily empire. [volume] (Juneau, Alaska) 1912-1926, 1922-05-30
RAILROAD MERGER DECLARED
ILLEGAL; DISSOLUTION CASE
CONTINUED From Page One.)

cific and Reading Consultations. all
OF later origin, were unmerged by
he Supreme Court while the South
ern Pacific merger was tediously
reaching that tribunal 1t was first
attacked by the government in 1894
a bill filed in California to dis
3olve fhe combination, but which was
dismissed without prejudice The
next proceeding was the present suit
brought in the United States District
Court for Utah on February II, 1914,
and dismissed ON March 8. 1917. An
appeal was promptly taken by the
government 10 the Supreme Court.
where the case remained four years
upon the docket before being argued
on April 20, 1921. AT the request
Of the court it was roargue1 on April
IL, 1922. One of the defenses ad-
vanced by the company is that the
case was barred by the statute of
limitation, more than five years hav-
ing elapsed between the develop
ment of conditions complained of
anu uilc LlblUS VI Llpe case
Issue Involved
The dissolution issue involved in
the case is whether the Central Pa
clfic and the Southern Pacific are
competing lines or are a single sys-
tenn. The government commended that
the Pacific Railroads acts of 1852
and 1854, under which the two rail-
roads were constructed with the
aid of land grants and bond issues,
required that the Cerrral Pacific
should be operated with the Union
Pacific as one continuous line. with
out discrimination against or in favor
OF each other. The Central Pacific
and the Southern Pacific, the govern
ected, separately aided by land
grants and public loans, separately
owned. separately LEASED, and prior
to 1899 controlled by separate boards
of directors.
Identity Of Management
The operation of the Southern Pa
cific by the Central Pacific began in
1872 and continued until 1885. coun-
sci for the company argued. insisting
that there was identity of manage
ment and equipment not only in the
construction, but also in the opera
ton of the two lines as one sys-
tenn. The Interstate Commerce Com
mission had recognized that there
was active and vigorous competition
between the ogden" and the Sun
set" routes, railroad counsel insisted,
and the Supreme Court had in the
nized, counsel added, that "sharp.
well-defined and vigorous" competi-
ton existed between the two routes.
1t was upon the finding of the court
that such competition existed that
it required the Union Pacific to re-
lease it's control over Southern Pa
cific. railroal counsel pointing out
that the court i'm that opinion per
mitted the Southern Pacific to re-
tain the Central Pacific. Congress in
authorizing the Secretary of the
Treasury to carry into effect an
dSI cclucHI ISdClitu ny d It cutl dl COul-
mission which negotiated a settle
ment cf the Central Pacific indebt-
edness. gave legislative approval,
counsel for the Southern Pacific in
sisted, to the ownership of the Cen
trial Pacific by that company.
The high financing" which the
government termed "a blot" upon the
history of transcontinental railroad
construction. it charged. caused
American methods to become by
word in European investment circles
for decade, and resulted in the APP
pointment by foreign stockholders
eff a protective committee