Page images
PDF
EPUB

6

decided by Mr. Justice McCall in this part of the court in the Matter of the Application of the Attorney-General for leave to commence an action against the Consolidated Gas Company of New York,' 56 Misc. Rep. 49. The opinion in that matter is in sharp conflict with the opinion recently handed down by Mr. Justice Holt in the action, Burrows v. Interborough-Metropolitan Company, U. S. C. C., Southern District of New York, not reported. The construction of statutes of this State by the Supreme Court of this State - should be followed by a justice sitting at Special Term rather than that of foreign tribunal of similar jurisdiction. Ju deed, the United States courts ordinarily follow the construction of the State statutes enunciated by the courts of the state in which the statutes were enacted.

"I am urged by the learned Attorney-General to disregard the opinion of Mr. Justice McCall, supra, and also to ignore the decision of the Appellate Division in this Department in the case of Rafferty v. Buffalo City Gas Company, 37 App. Div. 618, and to follow the opinion of Mr. Justice Holt, supra. I think, however, that the decision of the Supreme Court of this State upon a given question of law should be followed by courts of equal jurisdiction to the end that, without confusion, the question involved may be definitely settled by the Appellate tribunals. This is especially true where the decision is not clearly erroneous. (Peel v. Elliott, 16 How. Pr. 484; Bentley & Buruton v. Goodwin, 38 Barb. 633-640; Loring v. United States U. G. P. C., 30 id. 644; Celluloid Mfg. Co. v. Zylonite Co., 27 Fed. Rep. 295; Mayor v. Conover, 5 Abb. Pr. 171, 178.) In Peel. Elliott, supra, the court says: As this point seems to have been partially considered by one of my brethren, I do not feel at liberty to review that decision on this occasion; and as it is a novel and important question, I deem it most judicious to deny the motion to discharge from arrest, to the end that the judgment of the General Term may be taken on the points presented.' This ruling was made in a case where the point involved has been only partially considered by one justice. Certainly the rule is of much greater

force in this case, where the questions of law involved have, by another justice of this court, been very fully considered and determined within a very recent period. In conformity with the opinion of Mr. Justice McCall, supra, the motion is denied."

From the order entered upon that motion, I have taken an appeal which is pending.

ANTI-TRUST LITIGATION.

The People of the State of New York, plaintiff, vs. American
Ice Company, defendant.

This action was commenced by my predecessor in office on December 19, 1906. It was brought under chapter 690 of the Laws of 1899, to obtain a judgment annulling certain agreements alleged to be unlawful and perpetually enjoining the American Ice Company from carrying out the agreements, scheme and arrangement complained of. The answer was filed on the 9th day of January, 1907.

When I entered the office, I was unable to find in the office. files any memorandum whatever relating to the evidence upon which the complaint was based. I immediately caused an investigation to be made, and discovered that the report of the expert, who had examined the records of the American Ice Company, and upon whose report the action was commenced, had been taken from the desk of my predecessor in office at the Capitol, in the month of December, 1906. I obtained from the expert a copy of the missing report, but he could not furnish me copies of exhibits which had been attached to the original report. These exhibits consisted of copies of contracts which were alleged to be in violation of law and which were substantially the basis of action which my predecessor had commenced. Accordingly I was compelled to apply for an order to re-examine the records, books and correspondence of the defendant company.

A petition for the inspection and discovery of such records, books, etc., was presented to the Supreme Court, New York county, on the 14th day of February, 1907, and was opposed

by the defendant. On the 17th day of April, 1907, an order was entered granting my petition. On the 23d day of April, 1907, the defendant served its notice of appeal from that order, and on the 24th day of May, 1907, argument upon the appeal was heard in the Appellate Division. On the 7th day of June, 1907, the order of the Supreme Court at Special Term was affirmed by the Appellate Division, with a slight modification.

I immediately assigned experts to the work of re-examining the records, books and correspondence of the company and of taking copies of the same, in so far as they were pertinent to the case. This re-examination was concluded with satisfactory results.

On the 21st day of September, 1907, I sent to the District Attorney of New York county copies of the contracts, correspondence and other data so obtained, for such action against the defendant company as might appear to him proper, advising him that, in my judgment, the matter forwarded to him constituted proof of the violation by the company of the laws of this State prohibitive of monopoly.

The People of the State of New York, plaintiffs, vs. The American Telephone & Telegraph Co., The New Jersey Title Guarantee & Trust Co., Security Trust Co. of Rochester, George Eastman, Hiram W. Sibley, James S. Watson, Walter B. Duffy, Thomas W. Finucane and Edward Bausch.

Early in the month of February, 1907, complaints were received at the office of the Attorney-General that the United States Independent Telephone Company, by and through a committee representing holders of large amounts of outstanding stock and bonds, had entered into an agreement with a "trust company of high standing" for the sale of something like 90 per cent. of the stock and bonds of the company.

I had reason to believe from the information presented that this "trust company of high standing" was actually acting as the agent of the American Telephone and Telegraph Company, familiarly known as "The Bell," and that the latter company was seeking to create a monopoly in the telephone business in the State of New York, The United States Independent Tele

phone Company at that time owning or controlling the local telephone companies operating independently of and in compe tition with the local Bell Telephone companies in the cities of Rochester, Jamestown, Utica, Herkimer, Syracuse, and other intermediate places.

The United States Independent Telephone Company also owned the Stromberg-Carlson Telephone Manufacturing Company, which is the most important concern engaged in manufactering telephone instruments and supplies for independent telephone companies in the State of New York, if not in the United States.

The acquisition and control of this company and its subsidiary companies by "The Bell," therefore, clearly meant the practical monopolization of the telephone business by the Bell Company in the State of New York.

Therefore, on the 27th day of February, 1907, I made an application to the Supreme Court, Albany county, in accordance with the provisions of chapter 690 of the Laws of 1899, for the appointment of a referee and for an injunction order restraining the defendants mentioned in the application from doing any act, directly or indirectly, by which the ownership or control of the United States Independent Telephone Company through the purchase of its stock or bonds, or otherwise, might be acquired by the American Telephone and Telegraph Company, until the institution and termination of an action or proceeding which I determined to commence for the purpose of permanently restraining the consummation of the proposed sale and acquisition. Mr. Justice Fitts appointed Hon. Joseph A. Lawson, of Albany, referee and granted the injunction.

At the hearings before the referee the American Telephone and Telegraph Company appeared and admitted that the "wellknown trust company" was The New Jersey Title, Guaranty & Trust Company, and that it was in fact the agent and representative of the American Telephone and Telegraph Company in acquiring the stock and bonds of the United States Independent Telephone Company and its subsidiary companies, and that an agree ment to that end had actually been entered into between the American Telephone and Telegraph Company, through this trust

company and the United States Independent Telephone Company, by and through the agents and representatives of the stock and hond holders of the latter company.

Following the determination of the hearings and on the 10th day of April, 1907, I verified a complaint against the defendants, containing in substance the facts alleged in the original application, and ascertained upon the hearings, which were in effect that the contracts entered into between and among the several defendants constituted a scheme, agreement, arrangement and combination upon their part to effect the transfer, ownership and control of the United States Independent Telephone Company, its branches and subsidiary companies, by the American Telephone & Telegraph Company (the " Bell") and that such contract and agreement constituted an attempt to create a monopoly in the telephone business in the State of New York, in violation of its laws, and especially in violation of chapter 690 of the Laws of

1899.

Mr. Justice Betts on the 10th day of April, 1907, granted an injunction restraining the defendants from doing any act in, toward or for the making or consummation of the proposed agreement and combination, which injunction is still in effect.

The proposed agreement was practically abandoned as soon as the action was commenced by the Attorney-General and up to the present time the public has enjoyed the privilege of telephone competition.

In the Matter of the Petition of the Lockport Light. Heat & Power Company, for a certificate of authority permitting it to exercise its powers and transact the business set forth in the certificate of incorporation;

In the Matter of the Petition of the Lockport Light, Heat & Power Company, for permission to execute a mortgage to secure an issue of $600,000, five per cent., thirty-year gold bonds;

In the Matter of the Petition of the Lockport Gas and Electric Light Company, for permission to transfer its franchise and property to the Lockport Light, Heat & Power Company, and

« PreviousContinue »