New-York tribune., 1872-04-06
JAY GOULD TO DISGORGE.
IMPORTANT SUIT AGAINST THE OLD ERIE
RING.

THE MIsMANAGEMENT OF THE ERIE RAIL-
WAY-THE CONTRACTS TO BE INVESTIGATED
AN EFFORT TO RECOVER THE sQUANDERED
MONEYS OF THE sTOCKHOLDERs-THE SUIT
BROUGHT IN THE INTEREST OF THE ENGLISH
STOCKHOLDERS, AND THE NEW DIRECTORY
MADE PARTY TO 1T.
Much surprise has been OccasiOned by the failure
of the new directory Of the Erie Railway TO begin
proceedings against the former management for the
recovery of the large sums Of money belonging to
the stockholders which it well known had been
squandered through contracts improperly made by
the old directors of the road with themselves as
contractors 1t supposed that such action
would be instituted as Gen. Dix and the new
directors were firmly installed in power, but it ap-
pears to have been reserved for AttOrney-General
Barlow, who has been uncOmpromsing IN hisattacks
upon the Erie Ring to resume operations against
the old directory.
Gen. Barlow has instituted in the Supreme Court
at Albany suit against Jay Gould and Frederick
4. Lane to compel them to account for their man
agement aud restore the money which, as alleged.
they have corruptly received. The following sum-
mons in this suit has been served on Mr. Gould, Mr.
Lane and Gen. john A. Dix. and Field & Sheaman.
for Lane and Gould returned notice yesterday of
the acceptance of service.
Supreme Cotrt County of Abany: The People Of tho
State OF New-I York, plaintiffs against The Erie l"ilWay
summons. For Relief. To the defendluts aud each OF
them: You are hereby summoned ana required 70 ar
the complaint in this actiOn which VIII De hcd IN
the once Of the Clerk Of the County Of Albany, at
the city Of Albany, and copy OF your answer
10 me sad eompaml on tle SUD cIoIt 80 ms Clce ~
the city Of Albany. within 20 days alter the service of
this summons on you, exclusive OF the day Of such ser
vice. and II you fail To answer the said complaint within
the time aforesaid, the plaintiffs In this action Will apply
D4teG D. teG aP%a aaay. ?F r @ t'1 ~ @$H se @ =;
Gen. John A. Dix as President Of the road,
Is included in the suit as a mere fonnality, and
;c md. hat m i'm
finally prosecute the case. The fact that the Erie
Road is included in the suit as cO-defendaIt with
Gould and Lane also leads the belief that Archer
Eldridge, Sisson, and all the members Of the
old Ring" are affected by it. OF course, if re.
covery is had from tho road by successful suit all
the members of the old Board will have to pay the
losses which resulted to the Company by their negli-
gence in not restraining Gould Fisk, and Lane, OF
by their completely in any operations which may be
proved to be corrupt.
The suit was suggested many months ago by the
English stockholders, of both the Swami and OF the
Bischofisheim parties and Gen. Barlow, then just
elected AttOney-General. at once promised ener-
getic action against the men whom he believed to be
corrupt. As soon as he was in authority he took
steps to begin the suit and finally resolved to take
action under the following law
Al. (sec 49, The Supreme Court shall have lurls,
dcon directors managers, and other trustees ana
l. To compel them to account for their official conduct
in the management and disposition Of the funds aud
H. To decree aud compel payment by them to the cor
poraon whom they represent and TO rs creditors OF az
sums Of money. and OF the value OF all property which
they have acquired to themselves or transferred 10
others or may have lost wasted, by any violation or
their duties as such trustees;
ILL., To suspend any trustee or officer from eXer-
csing his Office, whenever 1t shall appear that lie has
". 10 rciaoye any srch tastee or Officer rom his
Office, upon proof or conviction OF gross misconduct
T.s1 al reIg a ~ ~
board duly authorized Tor that purpose, TO supply va
VI In case there be no such body or board or all the
members OF such board be removed then to report the
consent OF the Senate, to III such yacaueies
VII. To aside all alterations Of property made by
the trustees other officers OF any corporation contrary
To the provisions OF law tor any purposes foreign TO
eases where tine person receiving such alienation knew
the purpose for which the same was made; and.
VIII TO restrain ana prevent any such alienation IN
where may De Threatened or AeIe may De SoOd
reason TO apprchend II may be made.
43. Sec So Tie jurisdiction conferred by the preced
ing thirty yhId secdon shall be exercised as in ordinary
cases, bill petition, the case may require or the
Supreme Court direct AT the instance OF the Atol
General prosecuting IN Dehalf OF the people Oh tS
State AT the Instance OF any creditor OI sucA corpora
having general superintendent OF its concerns
law OF 1870 framed under Tammany rule, at the in
stance Of the Ring ITSELF and for its protection
made it impossible for any other than the AtorneyGen
eral TO begin such action The Ring then had no idea
that Il would so have 10 fight such an Attorney
General now opposes il.
The removal Of the Ring directors, or at least the
worst Of them, resulted from the operations Of Gen
sickles on March II, by which it will DC remem
bered the Opera House was carried and the Drec
tory captured ana this part of the work the Attor
neyGeneral, OF course found accomplished. His pur
pose is 10 compel Gould and Lane, who conducted
the road 10 diyulge all the r0gueries and rascal-
ties OF the management and to disgorge the
money OF which the Ring robbed the road.
II the suit ever trial. startling developments
IA
ecel in the Erie office to indicate that the half OF Eries
niGuties have not been told What amount can be re-
covered H. OF mere matter OF specuation but
il is well known that, by the score or more OF fraudu
lent contracts which the various directors had made
with themselves, many millions were lost to the stock
holders The suit no amount Of damages sought
to be recovered but it is probable that the revelations OF
fraud and the amount money of which the road has
been des poIled equally amazing in character and
The contract and leases which the Acknowledgement
beginning the suit assumed to be fraudulent and into
which he proposes institute legal inquiry,
n number Jay Gould is largely Interested In the Elm
Works. and the contracts with the Erie road are the
trolling interest in the Northern Railway Of NewJersey.
which has been leased for years to the Erie
ca Snd the cost F'Hii the fSs'
sa%ssp SCPa Tes On m fat wS tine Er
road. The Jefferson Car Company and the Union Car
road with cars on profitable terms. The Erie Coal Com
pany has rebate on all It's lreghts and supplies the
road with coal at good, paying prices. The late Vice
President Archer has contract In which the Others
supposed benerested for handling the freight OF the
road between Work and Jersey City The Erie Oil
Car Company" has Its particularly profitable rebate on
freghts. The sleeping Car and Coach Company
Gould Barr 4 Coz has paying contract by
which 1t receives five cents mile for every
ear run the road. The road pays Gould rental Of
sS for the Opera House. while the old Erie office at
ST. is let at nominal rental to the Boston Ex
press Company, n which Gould Is largely interested.
lie is President Of the favored Towanda Coal Con-
pany has half interest in the Blossburg Coal Company
Is corperatOr OF the Erie Refining Company, and
has half interest in Slate Roofng Com
pany all Of which have large and fraudulent