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3-04-2015, 21:47

An Angry Widow Sues: The Colton Letters

Before his death in October 1878, David D. Colton served as the Southern Pacific’s Sacramento lobbyist. Contemporary press accounts referred to him as the fifth member of the “Big Five” or the “Half” of the “Big Four and a Half.” His specialty was buying off politicians in the state capital to secure needed votes on measures affecting the Southern Pacific. Colton’s counterpart in Washington, D. C., was Collis P. Huntington, the shrewdest of the Associates and the most detested among them by contemporaries.

In the stormy aftermath of Colton’s death in his late seventies, his widow received slightly more than half a million dollars from the railroad in settlement of her husband’s stock shares. Trouble began brewing when she learned that Mark Hopkins, who had died earlier that same year, had amassed a much more valuable Southern Pacific stock portfolio than her husband even though both men had possessed comparable shares. Evidently, shares of the same stock had been valued differently for Colton and Hopkins. Mrs. Colton’s initial curiosity about this disparity quickly turned to outrage at the thought of being defrauded by her late husband’s business partners, the Big Four. She retained a lawyer and sued the Associates for $4 million.

A lengthy, publicized lawsuit, Ellen M. Colton v. Leland Stanford et al., followed. To establish her husband’s key role in the corporation, as well as his close ties to the Associates, in 1883 she furnished the court with several hundred letters written by Huntington and addressed to her spouse. Many began with the advice “Burn after reading,” or words to that effect. In one such letter, Huntington stated that “it costs money to fix things. . . I believe with $200,000 I can pass our bill, but that it is not worth this much to us.” As the letters became available, The Chronicle in San Francisco and the New York World printed them. Soon readers around the country were learning of the Southern Pacific’s bribes of Con-gresspersons, lower court judges, commissioners, and even a U. S. Supreme Court justice. For eight years the trial dragged on before a verdict resulted in denying Mrs. Colton any additional money.

The railroad had won the case but at the further cost of its reputation. Any doubt as to whether the Southern Pacific was a menace to democratic politics was removed by the revelations contained in Huntington’s infamous letters. Moreover, to the public, a lone bereaved widow had been exploited by a heartless, greedy, and hopelessly corrupt corporate monster.