Boston Railroad Holding Company

Product Details

$15 to $25

Historical Context

During the nineteenth century, the Boston and Maine Railroad grew to provide rail service in Massachusetts, New Hampshire and Maine. By 1900, this profitable venue attracted not only individuals interested in handsome stock dividends but other corporations as well. Among those were American Express Company and the Pullman Company who acquired large holdings of Boston and Maine Railroad stock at the turn of the century. In 1907, the New York, New Haven and Hartford Railroad --a consolidated corporation created by concurrent legislation of the State of Connecticut and the Commonwealth of Massachusetts -- purchased the American Express holdings and proceeded to secure control of the Boston and Maine by further purchase of stocks. The New York, New Haven and Hartford Railroad hoped to merge the two railroads with control firmly held by New York capitalists such as J. P. Morgan.

The validity of the purchase of stocks authorized by the laws of Connecticut, but prohibited by the laws of Massachusetts, became an issue upon which litigation was started. Hearings were held before the Committee on Railroads of the Massachusetts Legislature, concerning the proposed merger of the two railroads. In question was the legality of how the stock was acquired as well as whether this action would violate Federal anti-trust laws. William B. Lawrence, an attorney from Medford, Massachusetts, emerged as a leader of the minority of Boston and Maine stockholders opposed to the merger. The anti-merger faction not only questioned the legality of the merger, but they loudly protested the possibility of a distinctly New England operation being managed outside of Boston.

The debate on the merger took several years to be resolved. The General Court of Massachusetts, at its 1909 session, authorized the incorporation of the Boston Railroad Holding Company for the sole purpose of acquiring and holding capital stock of the Boston and Maine Railroad. By 1912, the Holding Company maintained absolute control of Boston and Maine. In 1916 the federal government decided that the New York, New Haven, and Hartford Railroad had indeed acquired the Boston and Maine stock illegally. The judge, hearing the case, appointed five trustees who were under decree to use their best efforts to complete the sale of the stock held by the New York, New Haven, & Hartford Railroad before 1918; it was extended to 1920.

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