San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1924-03-24
IS
PREPAREDFOR
MERGER FIGHT
City's Fight Based on Law
Preventing Destruction
of Competition.
PYEATT HERE TUESDAY
Will Meet Executive Com
mittee With Jesse H.
Jones of Houston.

Evidence has been almost completed
for the hearing of the case that will
be tried before the State Railroad
Commission in Austin on April 4. &C.
cording 10 Col. Claude V. Birkhead,
attorney for the fight that this city
is making on the proposed merger Of
the 1.-G. y. with the Gulf Coast. In
order TO secure quicker action, it has
been decided that the Ripley report
will be challenged through evidence
compiled in this city's case, so that
the Interstate Commerce Commission
will be compelled to see that the pres
cnt grouping of the two roads as pos
sible consultations will be. in prac-
teal effect. n violation of the trans
portation act of 1920. section 401.
paragraph 4. which states that com
petition shall be maintained.
AS the Gulf Coast Lines has basel
its application on the fact that. first,
1.-THE applicant believes that such ac-
QUESTION of control will be in the
public interest because the applicant
owns and operates a continuous rail-
road from New Orleans TO Browns
vile. and with the acquisition of the
observation-disclosures Northern. would
serve directly the important cities of
Fort Worth. Palestine. Austin. San
Antonio and Laredo, and afford proper
connection for outbound northern bus
mess" and secondly. "since the lines
of railroads OF the applicant are not
parallel or competitive, and do not con.
meet or join except in the city of
Houston, the proposed merger would
not in any substantial way lessen or
limit competition" the city of San
Antonio will attempt TO prove that the
I.-G. y. and Gulf Coast Lines are
parallel and competitive. and that the
merger would not preserve compet.-
ton. but would destroy it.
Must Maintain Competition.
According to the transportation act
of 1920, upon which the Gulf Coast
Lines was compelled to file its ease.
aud under which all railroads must
operate. mergers and consultations
must preserve competition. The act
states. in part:
ain the division Of such railways TO
such systems. under such plan, COM
petition shall be preserved, and as
fully as possible wherever practical
the existing routes and channels OF
| trade and commerce shall be main
/ tanned.
The City of San Antonio will virtu-
| ally base its case on this one sen
tence. according TO Colonel Birkhead.
I'VE shall attempt 10 prove 10 the
| Interstate Commerce Commission that
in preparing its tentative plan OF
grouping the I.-G. y. and the Gulf
Coast Lines in the same order. which
indicates that they would make a
possible consolidation, the fact has
been overlooked that the two roads
ere at present competitive" Colonel
Birkhead stated. According 10 the
transportation act. mergers must still
preserve competition. We will try "a
prove that the proposed merger wG j
destroy competition. and that therct~.,
the Ripley report is an injustice TO
our case.
Have the Application.
Should this evidence prove 10 the
state commission that the Ripley re-
port cannot apply TO these particular
roads, the Interstate Commerce Com
mission would have the power TO re-
fuse the sale. and the matter would
not have TO be handled through Con.
gress. as this city originally planned.
However. the case will be taken 10
Washington through Congressman il
necessary. according to Colonel Birk-
head. TO be fought through an amend
ment to the Esch-Cummins bill.
The first copy of formal appli-
cation before the |. c. {. from the
State of Texas for bearing in re-
gard TO the proposed sale, was for
warded to San Antonio by Attorney
General W. A. Keeling. and received
by the San Antonio Chamber of Com
merce Monday morning. In this re-
port the fact is stated that the mer.
ger of the I.-G. n. with the Gulf
Coast will only be admitted by the
State of Texas with the provision that
the general offices. machine shops ana
roundhouSes in Palestine shall be
maintained in the city Of Palestine,
under the contract of its predeces-
sors.
J. S. Pyeatt. president of the Gulf
Coast Lines. and Jesse ii. Jones Of
Houston. director of the I.-G. \.
Railway. will be present in San An
tonic for conference with this city s
executive committee handling the mer-
ger fight. Tuesday morning at 10 80.
The meeting will he held in the Cham
Der Of Commerce building. with A. r..
Half. chairman of the executive COM
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