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About The commoner. (Lincoln, Neb.) 1901-1923 | View Entire Issue (Aug. 1, 1914)
" S?fW wpwp J. The Commoner VOL. 14; NO. 8 14 -r n,,t . m -rrr,K, T.J1-5 President Wilson Directs Action Against New Haven Monopolists Following arc special tolograms to the New York World: Washington, July 21. By direction of Pres ident Wilson and with his entire approval Attorney-General McRoynolds is to institute at once a ault In equity to compel the dissolution of the New York, Now Haven and Hartford Railroad company. At tho same tlmo, and also by direction of the president, tho evidonco collected by the attorney general involving tho criminal aspect of the case will bo laid before a grand jury with a view to eocuro the indictment of those directors of tho road who wore responsible for its looting and the loss of millions belonging to tho stockhold ers. These two things wore decided on at today's cabinet meeting, at which the entire situation, developed sinco tho Now Haven balked on its own proposal to purchase tho stock of the Bos ton and Maine, was carefully gone over. PRESIDENT DIRECTS McREYNOLDS TO BRING SUIT A letter from the president to tho attorncy gonoral directing' hlni to take action was given out to-night. It says: Tho Whito House, Washington, July 21 My dear Mr. Attorney-General: ' I have your letter of today, 'inclosing a copy of your lettor of- July 9 to Mr. J. H. Hustis, president of the Now York, Now Haven and Hartford Railroad company, which together dis close tho failure of the directors of tho New York, New Haven and Hartford .Railroad com pany to comply with the terms of settlement pro posed by them .and accepted by us in tho matter of their railroad holdings. Their final decision in this matter causes me the deepest surprise 'and regret. Their failure upon ho slight a pretext, to carry out an agree ment deliberately and solemnly entered Into and which was manifestly In the common interest, is to mo Inexplicable and entirely without justifi cation. You have booh kind enough to keep me fully lnformod of every stop the department took in this matter, and the action of the department has throughout mot with my entire approval. It was just, reasonable and efficient. It should have rosultod in avoiding what must now be done. In tho circumstances the course you propose la tho only one the government can pursue. I therefore request and direct that a proceeding In equity be filed, seeking the dissolution of tho unlawful monopoly of transportation facilities in Now England now sought to be maintained by tho New York, Now Haven and Hartford Rail road company, and that tho criminal aspects of the case bo laid before a grand jury. With much regard, sincerely yours, WOODROW WILSON. With tho president's letter to tho attorney general were given out one from Mr. McRey nolds to the president and from him to Presi dent J. H. Hustis of the New Haven. McREYNOLDS CRITICISES INTERSTATE COMMERCE BOARD In his lettor to the president Mr. McReynolds points out that the New Haven directors repudi ated their own agreement. He gives a brief hiBtory of tho case and shows that ho had al ready prepared a dissolution suit which was "halted because the now management of the road Mr. Elliott's) had assured him that it desired to act with tho law. Tho attorney-general criticises the action of the interstate commerce commission in calling to the witness stand former President Mellen of the Now Havon, who, he declares, is "flagrantly culpable," and expresses tho fear that he may have secured immunity in that way. Ho calls attention to tho fact that tho presi dent has approved his course in the entire con duct of tho situation and ends by advising both civil and criminal action against tho New Haven Tho attorpoy-goneral's letter to Mr. Hustis was written July 9. It goes into the caso in even greater detail. Mr. McRoynolds puts the responsibility of the consequences of the suit squarely up to tho Now Haven board Ho shows that the $alo of the Boston and Maine stock owned ,by the New Haven under the enabling act of the Massachusetts' legisla ture, which the directors have repudiated, would have been mado under the same conditions which tho state has always imposed on the New Haven. Ho ends by saying the president finds it hard to beliove that such men as the directors of the New Havon could fall to carry out their agree- ment. SUIT WILL PROBABLY BE FILED AT ONCE It is expected that the attorney-general will file tho bill in equity in the southern district of New York at once. The document has been prepared for months and would have been filed long ago had it not been for the agreement which was entered into between the officials of the New Haven and department of justice for peace able settlement of the points at Issue. The evidence collected by the attorney-gen-oral which will be used in the criminal proceed ings, likewise will be turned over very soon to a grand jury for action. NEW HAVEN REPUDIATED ITS OWN AGREEMENT Washington, July 21. The letter of Attorney General McReynolds to President Wilson, calling attention to tho unsuccessful efforts of the de partment of justice to bring about a peaceful solution of the New Haven situation and recom mending that criminal and civil suits be insti-.' tuted against the road, follows: Department of Justice, Washington. D. C, July 21. To tho President, the White House. Dear Mr. President: Some days since, I re ported to you that the board of directors of the New Haven railroad had advised me that they would not carry, into effect the approved pro posals made by them last winter for bringing the affairs of that company into harmony with tho federal statutes. . Following your direction, I wrote to the pres-. ident of the company on July 9, expressing your views and my own in opposition to the position assumed by the board. A copy of that letter is attached hereto. Saturday last I received a request to confer with a committee composed of members of the board on yesterday Monday. They came here, and wo discussed the situation. I emphasized the position of the government as outlined in my etter of July 9, and energetically called at tention to the results which would necessarily follow adherence to the position taken by them. THE NEW HAVEN'S REFUSAL They refused, however, to admit any obliga tion to conform to the Massachusetts enactment and firmly declined to carry into effect their own proposals for an adjustment. During the past year you have been constantly in touch with my actions in respect to the New Haven road, and you have been good enough to express satisfaction therewith. It seems however, not inappropriate again to remind you of some aspects of tho general situation. Prior to 1908 the attention of the department of justice was called to the unlawful Combina tions and monopolies in which the New Haven ft thQ PrhlSlpal par' May of that year a proceeding under the Sherman law was instituted wherein the government sought to correct certain of the existing eX This suit was dismissed June 26, 1909 There after the monopoly proceeded to strengthen l hold upon the carriers of New England By the time your administration began thn New Haven aud the Boston and Maine rlilroads had been reduced to the unfortunate conation now unhappily too well known: their ZS widely distributed among small investors hS shrunken enormously in value, aSd the com merce and industries of all New gland we under severe strain. bmna Were ru .i SU!T PREpARED BEFORE Directly after assuming this officfi hni vinced that the situation Bdemauded'a thou investigation by capable counsel, I retained Mr T. W. Gregory, well known to vnn i , ability, industry and InteSty aw imnoihST In due time he reported? resu ?S?"ta searches, and I instructed him to prepare filing at the earliest possible rnoment a proceed thf lanweqUUy t0 KVent further violationsof moBiQfrt0r thIs could b0 accomplished the rail road company selected a new chief officer and ho earnestly asked to enter unnn m , with me looking toward anffimenfU out the necessity of a suit. You have been ffiffj with the outcome; and, as the terms of thpiaS agreed on were published, they became generally known. , Because of the important consequences in volved directly to New England and immediately to the rest of the Union, it seemed most im portant, first, to accomplish, if possible, a' restor ation of lawful conditions in the transportation facilities of that section with the least possible further distress to impoverished investors and unsettled industries; and I have acted accord ingly. GAVE NO HOPE TO CRIMINALS The criminal aspects -of the case have been kept constantly in mind, much data bearing thereon was collected months ago, and care has been exercised to permit nothing which might interfere with proper prosecutions at the ap propriate time. We have not held out the slight est hope that parties guilty' of criminal viola tions of the law would escape. . In April and May last, there being indication that the interstate commerce commission, by examining them, might immunize certain central figures in the unlawful arrangement, it was asked carefully to consider the effect of such action; Nevertheless, Mellen, and perhaps others fla grantly culpable, were put upon the stand, and any criminal prosecution hereafter instituted probably will be embarrassed bv a claim of im munity interposed in their behalf. SOUGHT TO AID STOCKHOLDERS With the utmost jpatience and in an intense desire tD enforce the law "in such a way as to bring no unnecessary hardship upon New Eng land or the unfortunate .holders of the railroad securities, we haVe sought to compel a restora tion of lawful conditions; but, as I believe, with out proper justification tho board of directors resolutely decline to proceed. under an approved arrangement adequate to that end and alto gether fair. I am of the opinion, therefore, that the time is at hand when we 'should file a" proceeding in equity, seeking the dissolution of the unlawful monopoly of transportation facilities in New England, and that tho criminal aspects of tho case should be laid before a grand jury. If these suggestions meet with your approval I will immediately give the necessary directions. Faithfully yours, J. C. McREYNOLDS. STOPPED FIRST STTTT WHEN ROAD GAVE ASSURANCES OF GOOD FAITH Attorney-General McReynold's letter to Pres ident J. EJ. Hustis, under date of July 9, calling attention to the attitude of President Wilson and the department of justice on the refusal of tho direcors to accept the legislation providing for the sale of the Boston and Maine stock, follows: Office of the Attorney-General, 'Mr t XT asJlinSton, D. C, July 9, 1914. Mr. j h. Hustis, President the New York, New Haven and Hartford Railroad Company, New Haven, Conn. it?2 P,eaTriSiro: ,Permlt me to reply to your iS a 2nly 8' InclosInS copies of resolutions ?wl y the diretors of the New Haven SioStdi conlpany on June 25 and July 8 re spectively, i also have a letter of July 6 from your counsel Mr. Moorfleld Storey of Boston. i,J,5rH- uese communications announce that 1 fh8,stSe recently passed by the Mas Naw WnlLleglature' wanting power to the totlnS aynenflrailroad company to dispose of its K stJn, 0 majority stock of the Boston and fh rLfcf 0ad !Gserves o that commonwealth h?opE of fy 'J? hereafter to purchase such leS lif filiation, to be ascertained by to ?hnZ? sses' yr directors feel at liberty sSlSmn r Jiny ,fUrther effort t0 com&y with the toSS n57PSttl Which thQy heretofore made brinr nf d7?ich AGre approved as adequate to with the law that comPanv lno compliance LAYS ONUS ON NEW HAVEN ana Su Iw13!0601 t0 the course Proposed, action rnVianat U ,s. without justification. Their SortanPA 5a qj;estIon of very large public im Ff nPrfoaiTanding serious consideration; and rector- m U" y0UlcPany, its officers and di tto inSv ffnhi aCCept the 80lG responsibility for uio inevitable consequences. teredunL1; Ve DTresent administration en fj0" "s dfutIes, I employed special counsel oTthe N fTT0t an tayestigation of the affairs ascertalnfZ naVen raIlrad for the purpose of it dev oi efGMaCt tions. In due time violated ami riat the anti-trust lavs were being tion nf ' Hni1 accordmgly directed the prepara mfractions strain aud prevent further Before this could be written and filed, and ft' ii .