Evening star., 1935-11-08
HOLDING COMPANY
FIGHT REVIVED AS
COURT UPSETSLAW
S. E. c. Is Expected to
Precipitate New Test
by Fines.
ACTION WOULD FOLLOW
REFUSAL TO FILE DATA
Decision by U. S. Judge in Balti-
more Forecasts Stiffening Of
Opposition by Firms.
BY the Associated Press.

BY the Associated Press
A new and immense struggle over
the utility holding company bill is
believed to be an imminent prob
ability. especially in view of a Bal
timore Federal judges decision yes
terday that the whole act in unconsti-
tutional.
Some officials of the Securities Com
mission are known to believe the
Baltimore result will stiffen the resist
ance of the utilities industry, and
that most of the holding firms will
refuse to register with the commission
at the deadline, December /.
If this should be the case, practi-
cally the whole vast industry would be
arrayed in determined resistance
against the act which grew out of
the Roosevelt administration attempt
to simplify" the holding company
set-up, to eliminate holding firms
deemed unnecessary" and to regulate
the remainder.
Requires Full Data.
Unless the Securities Commission
could win the court fight, its attempt
to enforce the act would be halted
at the very start. The registration
procedure calls for filing of detailed
information about the concerns finan-
cia. and operating structure.
The act provides fines and Jail
sentences for those who refuse to
register. If the Securities Commission
should move to enforce these pro-
visions, the result would be a test
case in which the Government would
be an active party.
The requested data would be used
by the commission in deciding which
companies should be eliminated,
question which, in general, hinges on
whether a concern holds sway over
territory considered too wide.
There was little doubt today among
observers here that the Government
would fight if faced with a wholesale
refusal to register. 1t was recalled
that, in the memorable controversy
over the measure at the last session
Of Congress, the administration forces
kept pressing for its enactment as a
measure necessary to reform evils.
while the utilities fought it vehe-
mently as unconstitutional and O
threat to investors.
AS a result Of the bitter fight, some
changes we're made in the bill before
it could be passed, but its opponents
still we're severely critical of it.
Federal Judge William C. Cole
mans ruling was that the law was
grossly arbitrary, unreasonable and
capricious." The Baltimore litigation
was between private persons interested
in a holding company.
The Securities Commission has
taken the position it would not be
bound by decision of unconstitu-
tionality in the Baltimore case. and
might act against individual concerns
which fail to register.
The opinion was expressed by one
official that a struggle over registra-
ton would precipitate the whole hold
ing company issue into the 1886 cam
paign.
1t was reported in Securities Com
mission circles that even before the
Baltimore ruling several important
utility lawyers had advised companies
not to register.
A. G. E. May Register.
Informal reports have reached the
commission that the Associated Gas
& Electric Co.. which fought the act
bitterly in Congress and then figured
prominently in lobbying investiga-
tions, would register. Whether yes
terday's decision would change the
company's plans was uncertain.
Only one registration has been re-
ceived at the commission to date, and
that was for a small company. The
larger concerns have maintained strict
'lence on their plans.
Members OF the commission de-
clined to comment publicly on the
(See UTILITIES, Page Sd