"Q. It is a matter of no moment that the place of ultimate destination is not a trade center?

"A. I don't understand the point you want to make.

"Q. I do not want to make any point, but simply want to know what you think should be the application of this principle? Is it a matter of any moment to the application of this principle that the point of the ultimate destination of the goods is not a trade center?

"A. No, not of any moment. It is simply to place the distributing centers on a par in competing for the trade of these points of ultimate destination.

Commissioner WALKER: "Do you recognize the existence of any distributing center between here and Chicago?

"A. We don't come in competition with any distributing center west of Chicago to amount to anything.

"Q. There are distributing centers in Iowa on the Mississippi river?

"A. Yes, sir.

"Q. Do you think the same rule should be applied to them?

"A. Yes; as far as we are concerned, we want to recognize all distributing centers.

"Q. I suppose, then, that you think, according to your rule, that the rate from Chicago to Omaha should be the rate from Chicago to the Mississippi river, plus the rate from there to Des Moines, plus the rate from Des Moines to Omaha ?

"A. If Des Moines were competing for Omaha business against Chicago that would be the rule.

Chairman CoOLEY: "Does not Des Moines come into competition with you through all this country in which you trade?

"A. I never heard of Des Moines in competition with Omaha.

Mr. GOUDY: "Is it not true that Des Moines sells furniture out through this country?

"A. It is a business I am not engaged in-a traffic that I am not familiar with.

"Q. You don't know just what traffic Des Moines does have, then?

"A. No, sir."

Mr. WOOLWORTII: "You are well acquainted with the whole course of business in this town?

"A. Yes.

"Q. And if Des Moines did business in this country you would know it?

"A. To any considerable extent; yes, sir.

"Q. And neither Des Moines nor any other Iowa town comes into competition with Omaha for the western business?

"A. I never heard of Des Moines in competition with Omaha.

"Q. Or any other Iowa town?

"A. No, sir.

"Q. Do you know what the relative business of Fremont and Omaha are as compared with each other, say last year? "A. Fremont?

"Q. Yes, sir.

"A. The relative business of Fremont, Lincoln, and Omaha? The business of Lincoln, from the best information I can get, is about one-fifth of that of Omaha. Fremont is probably about one-tenth.

"Q. Do you know what the wholesale business of Omaha amounted to during the last year?

"A. The merchants' traffic amounted to something like forty millions of dollars.

"Q. Do you know what the manufacturing business amounted to?

"A. Something like thirty millions of dollars."

Mr. THURSTON :

"Q. What is the relative business of Omaha and Chicago? "A. Omaha's business is probably, in merchandise, onefifth of Chicago. That is an approximate figure. As a meatpacking center we are the third in the United States.

"Q. Then, if Lincoln and Fremont have no rights against Omaha by reason of doing only one-fifth of the amount of

business that Omaha does, why should Omaha have any equality with Chicago when the ratio between them is the same?

"A. There is some place where you must draw the line, and the business of Omaha would seem to warrant that it had passed that line."

Robert Easson, another witness, testified to having been in the wholesale grocery business at Omaha nine or ten years. Formerly his house had rebates from the Chicago roads, but since the Interstate Commerce Law was passed they had had none. The rates from Chicago to Omaha had not been diminished in consequence of the stoppage of the rebates. The result of the new rates was a loss of business at a good many competing towns or buying points, and a necessity of selling in other cases at cost or with very little. profit.

"At Grand Island, for instance. The rate from Chicago to Grand Island was 55 cents, fourth class. The rate from Chicago to Omaha was 35 cents, and the rate from Omaha to Grand Island was 40 cents, making the rate from Chicago to Grand Island by Omaha 75 cents. This was 20 cents higher than the through rate. The staple goods in our line are sold on very close margins, and these rates force us to sell at cost in many instances, or they force us to lose the business."

Charles A. Harvey and F. Colpetzer gave similar evidence regarding the lumber trade. Mr. Colpetzer testified as follows in regard to rebates:

Question by Mr. WOOLWORTH: "Did you used to get rebates before the operation of the Interstate Law?

"A. Yes, sir.

"Q. Have you ever got them since?

“A. I have not.

"Q. Have the railroads reduced their charges here in consequence of taking away these, rebates?

"A. No, sir; the rates are higher from Chicago and elsewhere to Omaha than they were prior to the Interstate Law,

and up to December they were higher than they have been for three or four years, and I think possibly five years. I think the present basis that is now in order is higher. The tariffs have been on the whole lower than they will be when they are restored again. They used to average about 16 cents, but in addition to that we received refunds. I do not believe that the lumber which was hauled into Omaha netted any road more on an average than 12 cents for the past three or four years, if they paid the agreed rebates.

66

Q. Were these rebates allowed secretly or were they notorious?

"A. Secretly, certainly. The rebates or special rates were made to get the business.

"Q. Is it not an open secret that all large dealers got rebates?

"A. Yes; I should think it would be.

Question by Mr. THURSTON: "You say these rebates were an open secret. You do not mean that the public knew what rebates your company were getting? You did not give it away, did you?

"A. No, sir."

Allen T. Rector, in the wholesale hardware trade, testified to having formerly received rebates from the railroad companies, but these were discontinued March 5, 1887. He produced a table of figures to show that the discrimination against Omaha was as alleged in the complaint, and being asked why this discrimination should be made, replied:

"The present fourth and fifth class rates in operation from Chicago to Omaha are-4th class, 30 cents, and 5th class, 35 cents. Take Edgar, Nebraska, for instance. That is a common point 100 miles west of Omaha-a point tributary to Omaha. The fourth-class rate from Chicago to Edgar is 50 cents. Our fourth-class rate from Chicago to Omaha is 30 cents, and the fourth-class rate from Omaha to Edgar is 40 cents, making a discrimination against us of 20 cents.

"Q. And you don't know of any good reason for this discrimination?

"A. No, sir; I cannot assign any good reason; I do not know any good reason for it."

This statement of the salient points of the evidence will be sufficient for an understanding of its bearing upon the legal questions.

When the issues in this case were read and the opening made the questions presented seemed to be so nearly identical with those which were considered and passed upon in Crews v. The Richmond and Danville Railroad Co., 1 Int. St. C. C. Rep. 401, that a comparison with that case was necessarily in the minds of the Commission and also of counsel, and continued to be so throughout the hearing. In the case mentioned a claim was made on behalf of the city of Danville, Virginia, which was, to say the least, analogous to that here made on behalf of Omaha, and the Commission had been obliged to hold that it was not tenable. Danville claimed to be, and unquestionably was, a trade center of large importance, and it was insisted on its behalf that in making rates this fact should be recognized by the railroad company, and its trade with the towns naturally tributary to it protected. Taking a concrete case, for illustration of the manner in which rates should be made to give this protection, it was claimed that the rates from Richmond to Danville added to the rate from Danville to one of the smaller points beyond it on the same line should not exceed the rate from Richmond direct to such smaller point, since if it did the rates would give Richmond, in respect to all merchandise coming from or beyond that city, an advantage over Danville in the competition with the trade of such smaller point, and this would amount to unlawful discrimination. The complaint in that case, as in this, directed the attention of the Commission specially to the competition between the trade centers as the circumstance to be prominently kept in view in making rates, as if the question to be determined related exclusively to the large towns, though it was evident upon the face of the complaint that if the relief prayed for were granted it must necessarily result in a large relative increase in the rates on long hauls to the smaller towns as compared to the rates which would be charged to trade

centers.

In disposing of that case the conclusion of the Commis