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The decision as rendered by the Commission is described elsewhere in this report in the statement of decisions rendered by the Commission during the year. The order of the Commission in this case was that defendants must cease and desist from charging higher rates on live stock than on live-stock products shipped from Missouri River points or South St. Paul, Minn., to Chicago or from points in intermediate territory to Chicago. The practice of charging higher rates on live stock, as shown in this
case, arose in
of a contract made between the Chicago Great Western Railway Company and the Missouri River packers to put in certain rates on live-stock products, in return for which a stipulated tonnage was guaranteed to that company.
The United States circuit court, in a long opinión, refused to enforce the order of the Commission. The court holds that the Chicago (reat Western, by the contract above mentioned, reduced the rates on live-stock products, but it did not originate the competition in those products; that such competition was going on between the above defendants and other railway companies when the contract was made; that each company was striving to get what business it could, and that the Chicago Great Western Railway Company reduced the rates in order to get its share of the traffic, in which all the defendants were and had been competing; that the reduction of the rates made by the Chicago Great Western was forced upon it, as it could not otherwise continue to successfully compete with the business; that such reduction was therefore not voluntary on its part; that the fact that defendants might, if they chose to do so, bring about as severe competition in live stock as in its products is immaterial; that it is suficient that real and substantial competition is not as severe in live stock as in its products, and that it is useless to inquire whether it might be possible to make competition as severe in the one case as in the other.
If the decision of the circuit court in this case is sound any carrier is justified in making the widest discriminations in rates as between competing commodities, regardless of the effect upon nonfavored industries, by simply asserting the existence of general competition :ind the desire to increase the traffic in particular commodities over its line.
Such further action will be taken in this case as may be deemed necessary.
The Pennsylvania Petroleum Reparation cases.- The United States circuit court of appeals for the third circuit decided, in May last, in two cases brought by the Western New York & Pennsylvania Railroad Company et al. v. Penn Refining Company (Limited), of Oil City, Pa. Its decision reversed the judgments of the United States circuit court for the western district of Pennsylvania, in which, after
jury trials, damages were recovered by the Penn Refining Company based upon the decision of the Commission awarding reparation in the cases of the Independent Refiners' Association of Titusville and Oil City, Pa. The decision of the United States circuit court of appeals (137 Fed. Rep., 343), is based principally upon errors found in the proceedings of the court below. It is probable that the case will come up on appeal before the United States Supreme Court.
Discrimination in furnishing cars.—The United States circuit court of appeals has rendered a decision in the case of the West Virginia Northern Railroad Company et al. v. United States ex rel. Kingwood Coal Company (134 Fed. Rep., 196), affirming the judgment of the United States circuit court.
The case was brought in the circuit court under the new section of the act to regulate commerce, which authorizes circuit courts to issue writs of mandamus, in cases of discrimination, including those which relate to the furnishing of cars, and the decision of the circuit court was favorable to the complaining coal company.
In affirming the decision of the circuit court the circuit court of appeals said:
It is insisted that the court had no power in a proceeding of this character to fix the percentage of cars the relator should have, and to command that such percentage of cars should be furnished to the relator. The acts of Congress forbade discrimination, and made it unlawful to give any undue or unreasonable preference or advantage to particular persons, companies, corporations, or localities, or any particular description of traffic, or to subject them to any undue or unreasonable prejudice or disadvantage in any respect whatsoever, and vested jurisdiction in the circuit and district courts to proceed by mandamus as a cumulative remedy for violations of the statutory provisions. The West Virginia Company owned no coal cars itself, but obtained them from the Baltimore & Ohio Railroad Company.
We are unable to accept the view that Congress intended to confine the scope of the writ to admonition merely, or to a general command to desist from discrimination, rather than from the particular action in which the discrimination consisted. By the findings the delivery to relator of any less than 31 per cent of the supply amounted to unlawful discrimination, and the judgment of the court did no more than to correct it.
Compulsory testimony.—Two cases affecting compulsory giving of testimony and the production of books, papers, and documents have been decided by circuit courts during the year.
A proceeding entitled In re Hale (139 Fed. Rep., 496), decided in the United States circuit court for the southern district of New York in June last, holds that a subæna duces tecum commanding the secretary and treasurer of a corporation supposed to have violated the antitrust act to testify and give evidence before the grand jury, and to bring with him and produce numerous agreements, letters, telegrams, reports, and other writings, described generically, in effect including all the correspondence and documents of his corporation originating
H. Doc. 195, 59-1--5
since the date of its organization, for the purpose of enabling the district attorney to establish a violation of such act on the part of the witness' principal, constitute an unreasonable search and seizure of papers, prohibited by the fourth amendment to the Constitution.
In United States v. General Paper Company et al., the United States circuit court for the eastern district of Wisconsin (case not reported) held, on application to compel witnesses to testify and produce documents before an examiner in an action pending in the United States circuit court for the district of Minnesota under the antitrust act, that in all interrogatories addressed to the witnesses for information within their personal knowledge, apart from the production of records and documents, that the only constitutional privilege which can be involved is personal and can not extend to the corporation or be invoked in its behalf. The court said that the fact of the witness being an officer of the corporation, and in that relation having acquired the information sought, whether confidential or not, does not affect the privilege of a witness under consideration. Whether the General Paper Company was entitled to the privilege in respect of records and documents produced by its officers, or whether the immunity was completely applicable in such event, the court said, are questions not so readily solved.
The opinion goes on to say:
The corporation can neither take the witness stand nor appear except through a representative, and the witness in such case represents alone the corporation's duties and rights, and not his own. So viewed, is commensurate immunity extended to the corporation by the terms of this act? Does it cover the liabilities to prosecution of forfeiture under State as well as Federal authority? If these questions fairly remained open to consideration in this inquiry, I should hesitate to pass upon them without reviewing the objects of the constitutional provisions and the long line of authorities cited thereupon. The doctrine, however, which is upheld in the line of cases referred to under the interstate-commerce act is, as it seems to me, decisive of the interpretation that the immunity extends to the corporation defendants, and must be treated as complete in its operation.
The antitrust act is recognized under all the authorities as founded alone on the powers of Congress in reference to interstate commerce, and no escape appears from the conclusion that its amnesty proviso is coextensive with those of the companion act so founded.
I am of opinion, therefore, that the records and documents are subject to production and use in evidence, but without disturbing their custody, unless special cause shall appear.
It is understood that this ruling was somewhat modified by a recently delivered decision of the circuit court of appeals.
The Santa Fe Contempt case.-In March, 1902, a temporary injunction was granted by the United States circuit court for the western district of Missouri upon application of the Attorney-General filed in the name of the United States against the Atchison, Topeka & Santa Fe Railway Company. Injunctions against other carriers were issued upon like grounds at the same time. The basis for these actions was found in the record of investigations made by the Commission and subsequently reported to the Attorney-General, which indicated the giving of rebates by the carriers upon dressed meat, packing-house products, and grain and grain products.
The injunctions issued restrained the carriers from continuing to depart from their published rates on such commodities or upon other interstate traffic carried over their lines. On February 19, 1903, the Elkins law was passed by Congress, and in this act application for injunctions upon request of the Commission was expressly authorized. Soon after the passage of this act the United States Supreme Court decided the case of Missouri Pacific Railway Company v. the United States, (189 U. S., 274), holding that an injunction issued before the Elkins Act by the circuit court in that case upon application of the United States alleging violation of the act to regulate commerce was not authorized, but that since the enactment of the Elkins law it was authorized, and remanding the case to the circuit court for further proceedings.
On January 19, 1904, the Commission concluded an investigation in what is known as the Hutchinson Salt case, wherein it was shown that the Atchison, Topeka & Santa Fe Railway Company and other carriers had, through a division of rates with a so-called terminal railroad, granted concessions in rates which inured to the benefit of the Hutchinson (Kans.) Salt Company; and on February 1, 1905, the Commission concluded another investigation, in which it appeared that the same carrier had granted rebates to the Colorado Fuel & Iron Company on coal originating in Colorado. The evidence and reports of the Commission in those cases were reported to the Attorney-General. Thereupon during the present year informations charging the Atchison, Topeka & Santa Fe Railway Company with violation of the injunction or restraining order issued by the court in 1902 were filed under direction of the Attorney-General.
Decision has recently been rendered by the circuit court sustaining a motion on behalf of the defendant carrier to quash the informations. The court holds, first, that it had no authority to grant the injunction in 1902, following the decision of the Supreme Court in the Missouri Pacific case; second, that the Elkins Act of 1903 does not have retroactive effect; third, that the injunction of 1902, though containing a general prohibition against departures from tariff rates upon all interstate traffic, applied, under the doctrine of construction, only to traffic of like kind with the articles specifically mentioned in the decree; fourth, that the court “is without authority in this proceeding to draw to it the questions involved rightfully belonging to the jurisdictions of the United States circuit courts for the districts of Kansas and Colorado."
Court decisions relating to the safety appliance law.—Perhaps the most important decision, in so far as the administration of the safetyappliance acts are concerned, is that of Judge Humphrey in the district court of the United States for the southern district of Illinois in the case of the United States v. Southern Railway Company (135 Fed. Rep., 122), decided March 2, 1905. This was an action brought by the United States attorney, at the suggestion of the Interstate Commerce Commission, against the Southern Railway Company to recover penalties for violation of section 2 of the act of March 2, 1893, as amended. It was shown that defendant hauled over its line cars originally equipped with automatic couplers, but which had been allowed to become so defective that they would not couple automatically by impact and could not be uncoupled without a man going between the ends of the cars.
The court held that it was no defense to show the exercise of reasonable care and diligence on the part of the defendant to keep the company's apparatus in repair; that a car loaded with coal to be delivered to a consignee in another State is “ used in moving interstate traffic ” within the meaning of the safety-appliance statute by the railroad company which takes it from the place of loading, although such company only undertakes to deliver it to a connecting carrier within the same State; that the placing of an "M. C. B. defect card” upon the car and noting on such card defects forbidden by the safety-appliance acts, which is notice to all connecting lines that the defendant sent the car out defective, and that all other lines using the car would not have to account to defendant for the particular injury or defect noted on the card, is such a deliberate violation of the statute as to amount to a defiance of the law; and that what is forbidden by the act is the use of cars which can not be coupled automatically by impact and uncoupled without the necessity cf men going between the cars, and unless the car is so equipped it is not to be put in service and not to be used. The court said:
The act is so highly meritorious, so generous in its purposes, so in harmony with the best sentiment of a humane people and a progressive government, that it appeals strongly to the courts for its prompt and vigorous enforcement.
The Supreme Court, in the case of Union Stock Yards of Omaha v. Chicago, Burlington & Quincy Railroad Company (196 U. S., 217), held that a terminal company whose negligence toward one of its employees in failing, by proper inspection, to discover a defective brake on a car delivered to it by a railroad company has been established by a competent tribunal can not enforce contribution or recover indemnity from the railroad company because of the latter's like neglect of duty.