William Howard Taft

“ The Coal Company will be permanently enjoined from issuing to the Reading Company, and the Reading Company from receiving, any stock, bonds, or other evidences of corporate indebtedness of the Coal Company. On default the trustee of the mortgage is required to vote the Coal Company stock, so as not to bring about a recurrence of the conditions condemned in this cause, and, if it shall be necessary to sell the properties, they are to be sold to different interests. ”

“ If the argument of appellants were carried to its logical result, all the net earnings of the Reading Company in 25 years, no matter how invested or applied to increasing the earning capital, must in a liquidation be treated as undistributed profits, to go entirely to the common stock without any action of the board of directors. ”

“ The disparity shows that while the transfer of certificates of interest in the new Coal Company stock is denominated a sale, it is only a distribution of the surplus or assets of the Reading Company to its stockholders made necessary by the decree of this court in taking the Reading Company out of the coal business and restricting it to that of owning and operating a railroad system. ”

“ Ct. 589, 56 L. Ed. 911, is a stronger instance of the power of Congress in regulating interstate commerce to disregard contracts than is needed in this case, because there it was enforced as to a contract made before the regulation. ”

“ It is asserted further by the Reading Company, and not denied, that, when this decree was entered by the District Court, the monetare situation was such that it would have been impossible to secure a purperties at any Reading Coal Company properties at any fair price ”