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Show ARGUgIS ' Attorneys Review Government Gov-ernment Case Against U. P. and S. P. Poads ST. PAUL, Mlno, Oct. 11 -He fore the Cni'cd States circuit court hire tcdav the atgument of the governments govern-ments cace, in which a dissolution of the merger of the I nion Pacltic and the Southern Pacltic railroads i (ought, was continued, and Judge 1. F. Ininne, general counsel for the Southern Pacific, began argument for the railroads. IJy" agreement the railroad side of the' ca.-e will be continued tomorrow. tomor-row. C. A. Severance concluded the gov-trnmcnt'-s arguments today. Mr. Severance's Sev-erance's main contention was that the merger of the two roads had increased increas-ed rates, while the service had dete-llorated. dete-llorated. He maintained that Colorado Colo-rado was the only territory touched by the vait I'nion Pacific system where there was genuine railroad competition. Were Connecting Lines Prior to the Merger. Judge Hunne's argument was directed di-rected principally to prove that the Union Pacific and the Southern Pacific Pa-cific were connecting lines prior to the merger and were not in any direct or foibstantial sense competing. He based this contention upon the orlgl nal net of congress passed In 1S62. authorizing the construction of the Union Pacific and upon subsciuent acts amendatory thereto. It Is agreed by the patties that unless an actual and constant competition existed at the time the merger was effected tho Illegality of the combination as a violation vio-lation of the Sherman anti-trust act probably cannot bo sustained. Citing from the acts of congress, Judge Dunne said it was the Intention Inten-tion of the government at the time the Union Pacific was authorized that the line xhould be built from the Missouri Mis-souri river to the Pacific coast and should be operated as one connected or continuous line. Terminus Should Be at Ogden. H is said considerable stress was laid upon the word "connected " The Union Pacific was constructed west of Ogden when it met tho tracks of the Central Pacific, and in ISC!) it was provided that the common terminus of the Union Pacific and the Central racllic should be at Ogden. where the rails should meet to form one continuous con-tinuous line. After citing the leasing of the Central Cen-tral Pacific by the Southern Tacific, Judge Dunne said: -The Southern Pacific wag under no obligations to make a traffic agreement agree-ment with the Union Pacific so far as the Central Pacific was concerned It could have made the same agreements agree-ments with the Denver & Rio Grande and cut the Union Pacific to a strictly strict-ly local line doing business between interior points, with no coast terminal. ter-minal. Could Have Closed Western Gateway. "The Southern Pacific could have closed the western gateway to tho Union Pacific and kept It entirely out of the seaboard and Interior transcontinental transcon-tinental business. It did not, because the roads were neither actually nor constructively competitors. "The Southern Pacltic and the I'nion I'n-ion Pacific have been partners in every ev-ery ton of freight that left the eastern east-ern terminals for California. They have been united against their common com-mon enemy, the Santa Po. That Is why the Southern Pacific, controlling the situation at Ogden, has been willing will-ing that the Union Pacific should carry car-ry transcontinental freight to eastern markets." Why S. P. Should Receive the Trade. Judge Dunne took occasion to explain ex-plain the reasons why the Southern Pacific received per cent of the Oriental Ori-ental eastboiind freight received on Pacific Mall boats control!, d by the Southern Pacific, and the Santa Fe, its acknowledged cDcrny, receives 25 per cent, "A long time," taid Judge Dunne, "the Santa Fe maintained a trans-Pa-cilic Hcamshlp connection fiom San Diego. It was abandoned and it has been openly said that the Southern Pacific, In return for this recession on the part of the Santa Fe, l.s voluntarily voluntar-ily giving it 2"j per cent of the Oriental Ori-ental business. Santa Fe Receives Oriental Trade. "1 he fact Is that the Santa Fe steamship wa.s a losing proposition and was abandoned for that reason. The Santa Fe has been carrying consul-Table freight to San Francisco and sending It over the Pacific mall, and it is in Justice to this situation that the Pacific .Mall turns over a portion of Its eatbound freight to the Santa Fe " |