Evening star., 1925-04-03
Justice Hitz Issues Tempo
rary Order Against Board on
Pacific Lines Plea.
AWARD BY CLOSE VOTE
AND BITTER ROW CITED
Five Vessels Involved in Litiga-
tion Are in California
Orient Service.

A temporary injunction blocking
sale of the Shipping Boards Cali
fornia Orient Line was issued today
by Justice Hitz Of the District OF Co
lumbia Supreme Court.
The injunction was issued on petit
tion of the Pacific Mail Co, which
now operates the line, and which
was an unsuccessful bidder for its
purchase against the Dollar inter
ests.
In its petition the Pacific Mail Co.
contended that the boards decision
10 sell the five vessels to the Dollar
Co, decided on after a bitter row
among board members and by ma
jority of one, was illegal for many
reasons.
Sees Its Business Hurt.
Such a sale, the petitioner declared,
would seriously disrupt its business.
1t was alleged also that the Pacific
Mail had not been given ample op-
portunity to bid for the ships.
In support of numerous specific al
legations that the board acted il
legally, the Pacific Mail presented
statements from Commissioners Ben
son. Plummer and Thompson of the
Shipping Board.
These commissioners denounce the
sale on the ground that the price was
only one-fourth of the cost of
placing the vessels; that the San
Francisco Orient line, in which the
ships are operated for account Of the
board, is now making money and there
is no necessity for sacrifice; that the
sale creates a monopoly of American
flag passenger service under the con-
troll OF the Dollar interests; that the
sale makes no provision for replace
ment of vessels and enforces no
penalty performance bond for main
tanned operation. and that the sale is
not prudent or businesslike.
Benson Opposition Stated.
Admiral Benson's statement. not
hitherto published. declares that the
Dollar interests, by not seeking to
buy similar ships which they now
operate for the Government from
Seattle to the Orient, will by acquir-
ing the San Francisco Orient Line be
BILE to divert freight and passengers
from the Government-owned ships to
their own ships, thus compelling the
Government TO assume the entire ex-
pense of operations from Seattle or
TO sell to the Dollar interests al such
price as they care TO pay.
The Pacific Mail charges that the
advertisement of the board for bids
stated: Negotiations may be con-
tinued and all offers received before
final award will be considered" and
that the Pacific Mail presented an
offer of s6,750,000. with adaptations
to meet the legal objections raised by
the boards counsel and requested op-
portunity to negotiate as provided by
the advertisement, but that the
board refused to negotiate and did
not consider the bid, and that the
sale thereby was rendered non COM
petitive and therefore illegal.
1t is pointed out that the Pacific
Mail bid conformed to recommends
tions of a committee of the Presi-
dents cabinet. 1t is alleged that
under the merchant marine act the
Pacific Mail is entitled to preference
in the sale of the vessels which il
has been operating, not only because
of its having been an established line
in the transpacific trade since 1867,
always operating under the American
flag, but because it withdrew its own
ships from that service in order to
put all its organization, good will
and going business behind the Ship
ping Board vessels. with the purpose
of purchasi them at some time.
Most Profitable Line.
IT is set forth that the California
Orient line operated for the board is
by reason of the Pacific Mails serv-
ices the most profitable, If not the
only profitable, Government line, and
that the proposed sale would deliver
the line over to the Dollar interests,
who are failing to bid on the ships
they are operating from Seattle, and
will visit irreparable damage upon
the long blished business OF the
Pacific Mail.
1t is alleged that the Shipping
Board failed to take into considera-
tion practically every major require
ment of the Jones act relating to
sales and that in voting to accept
the Dollar bid it accepts a maximum
fve-year agreement for maintained
service against a minimum of 10
years offered by Pacific Mail. Also
that the Dollar bid contains abso-
lutely no provision for replacement of
the present vessels with new vessels
capable of meeting foreign compe-
.tition and serving as naval and mill
tary auxiliaries, whereas the Pacific
Mail bid carried a business-like plan
for replacin the fleet with modern
Diesel vessels.
Therein it is alleged the purpose of
the merchant marine act Is not car
ried out, and that the board has su-
bOrdlnateQ the vital ndtlondl pOllCy
laid down in the Jones act to the
question of price, and even then pro-
poses to accept in the Dollar bid ST.
I25, 900 less than offered by the bid of
the Pacific Mail. The Pacific Mail
further charged that majority of the
members of the Shipping Board have
shown at sundry times, and particularly
in connection with matters referred
to in the bill, "a disposition to deal
with r. Stanley Dollar upon terms
and conditions and in q manner
| which the plaintiff alleges and AYERS
| is unduly prejudicial to the inter-
| ests of the Government"
Goes Into Another Sale.
Tn this connection the bill states
| that the board previously sold to the
Dollar interests in 1928, without spe-
| ciaI public advertisement other than
| a general blanket advertisement
many months previously, seven ships
| of the "5o2" President class at an
aggregate price of only $3.50, 900,
under an extremely favorable con-
| tract, in which failure by the Dollar
| interests to maintain guaranty hve-
year around-the-world service inn
posed no penalty on the purchaser.
The bill of complaint states that