Death Sentence Upheld

After more than seven years on the statute books famed Section 11 ("Death Sentence") in the Public Utility Holding Company Act last week got its first court blessing. A Manhattan Appellate Court told North American Co. that the death sentence was constitutional, did not clash with the Fifth ("due process of law") Amendment. Up to that moment only the registration provisions of the Holding Company Act had been specifically upheld by the courts.

Crestfallen North American Co.--which in a happier era the President had once cited as an example of a "good" holding company--has 90 days to decide whether to surrender to SEC's disintegration order or to carry its battle on to the Supreme Court. SEC was inclined to hope that it would, since a Supreme Court ruling would decide the issue once and for all, make it unnecessary for SEC to fight four other death sentence challenges now in the lower courts. But even before last "week's decision five big systems had knuckled under, filed disintegration plans with SEC.

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