The Actual Decision in the Merger Case. Anti-Trust Act, so-called; the defendants were: The Northern Securities Company, the Northern Pacific Railway Company, the Great Northern Railway Company, James J. Hill, William P. Clough, D. Willis James, John S. Kennedy, J. Pierpont Morgan, Robert Bacon, George F. Baker, and Daniel S. Lament,—all of whom were charged with entering into a combination against the pro visions of the anti-trust act. The testimony taken upon the hearing was voluminous, but perhaps the follow ing summary will suffice. Two of the de fendants, the Northern Pacific Railway and the Great Northern Railway, own lines run ning from the Great Lakes to the Pacific Ocean. A glance at a railroad map of the United States will show to how considerable an extent these systems are competitive from the necessity of their situation. And until 1900 there had generally been compe tition between them, although there had been temporary cessation at various times. In 1901, it was disclosed by various move ments that a few large stockholders had virtual control of both railroads and were directing them according to concerted plans. The joint purchase of the Chicago, Burling ton and Quincy Railroad, was an avowed first step toward ultimate community of in terest. There followed upon this deal one of the fiercest assaults to capture a railroad from its holders in the history of the stock market; Northern Pacific sold on one day for $1000 a share. It was a drawn battle; the treaty of peace that followed after ne gotiation was the formation of the Northern Securities Company. In accordance with this plan it was ar ranged between the individual defendants and various others not defendants to form a holding corporation to take over the most of the stock of both the Great Northern and the Northern Pacific—and to issue in ex change stock of the new company. The in dividuals who conceived this plan, it was
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proved, came to a preliminary agreement as to this general scheme. The Northern Se curities Company was thereupon organized under the laws of New Jersey with a ca pacity to issue $400,000,000 of stock in ex change for stocks of other companies which its charter empowered it to hold. Soon af ter its organization this securities company acquired 96 per cent, of the capital stock of the Northern Pacific Company, at the rate of $115 per share, paying for this in its own capital stock at par; and 76 per cent, of the stock of the Great Northern Company was bought at $180 per share, payment as before being made in stock of the hold ing company. So much was this flotation to the mind of the market that Northern Securi ties was sold on the curb as high as 115. But throughout the Northwest the merger was viewed with alarm as certain to lead to increase of rates in the end and consequent ly to repression of its trade. It was doubt less this widespread indignation on the part of the people most involved that led to the early beginning of the litigation and the ac tive prosecution of the suit. The govern ment, to be sure, was aided in advancing the suit by the act of February n, 1903, which required the expediting of such cases upon a certificate that they are of general public importance. The Circuit Court judges de cided unanimously for the government on April lo, 1903, after elaborate proceedings, Mr. Justice Thayer writing an able and com prehensive opinion. The decision was an unpleasant sur prise to many, but it was acclaimed by others. During the year that followed al though contraversalists in the public prints discussed the problem with much heat as an open question, the generality of observers came to the conclusion that the Supreme Court would affirm the decree. On March 14, 1904, only the expected happened when the Supreme Court decided for the govern
