New-York tribune., 1874-12-04
4 CRISIS IN THE BOARD.

CRISIS IN THE BOARD.
There was a strong feeling between several
Of the members Of tlc Board hand and James D.
Smith and Charles J. Osborn on the other. When the
present Board formed there considerable Oppo
suon the latter the ground that they stock
brokers and represented jaw Could From time to time
they charged different ways with using their
position II the Company 70 depress stock other
wise TO irjure its credit Finally the Board adopted
formal resolution declaring that 1t the hight Of
impropnety for any member 10 short" Of the
stock. and pledging and director TO refrain
from such dshOnorable speculation. Russell Sage
sided this meeting and subscribed heartily to the res
outions For few peace appeared 10 dwell in the
Board. but the appearances were deceptive, for on
Wednesday week ago. at a meeting specially called
President LIS chair and IN decided language
made an address. in which lie stated that some
members OF the Board were using their
position TO bear" the C0mPlny's stock in the market
that they had gwen privae information of the Com
panys affairs, which being published in The newspapers
had done great TO its ere t and that they should
De held TO strict accountability, ami II sucn conduct
we're persisted It they should nc driven rom tie drec
ton OF the COMPANY. The information IL question was
20 the eject that the floating Indebtedness
of the Company F,7OOCOO, about E.6iO,OOO OF
which was for uaoihties maturing on three
new steamers contract Alter dwelling on these
points, President lse lie would treat recusant
directors OF the Pac a. Man Company he had treated
- bearish" directors IL the Milwaukee and ST. Paul
Railroad which he IS the Vco-PFesident The faces
Of the other directors o: tie Board we're study
during the delivery OF ihs speech, but more
especiany was he attention Of al directed TO
charles J. OSBORN and James D. Smith, for
al,bopph M SAKE had meuloued names
u was very onvous mat these The persons re-
Terred 10 IN remarks. Iadeed Mr. sage sald niOr-
nally tnat they were tue men 20 whom ne referred.
As soon as the heated Pce-4en took lis seat Ooth OF
the eDraged directors rallied TO rcpel his Charges Ihey
declared that President sage knew that the Company
had large floating ceU hut had concealed II IN order
10 sell out the stock he carrying ana tnat
after selling il he then guilty OF the very crime
with which be mad falsely charged them, WIS gong
short" OF The C0mpan, stock IAey tHrJher GecI1Eeo
.aat he II was VINO had circulated false information
concerning the alleged settlement OF the Fac.nc MI"
and Union Pacific Companies.
After an angry debate II was resolved that COM
ntee should be appointed 70 Investigate the nnahcla
condition of Company. aud also ascertain whether
the directors were then OF had bcen snort Ol 'no
COMPANY stock. T. L T4co;t was appointed COM
u,ee OF one TO conduct the latter investigation anu as
her. was sbrewd suspicion that President Sage was
NOT so spotess as he would have people believe special
efforts were taken 10 ascertain how he STOOD
On Saturday last TIE Board assembled TO participate
In the Investigation 10 regard TO the specniaung eh-
1enctes OF the directors J. was finally agreed that the
directors should put upon honor and should TESTIFY
~--~--
scene.
Turning 10 President Sage. and bOwing gravely and
,ourteously Mr.. Tc1tt biandly said: MI President
a. you are he presd.ng officer OF TINS Board, 1t IS only
fitting 10 your position that yea should be examined
urst Have you ever gone short Of the Company's
stock sold calls on IL since your e4ec'ioH dc
director 2"
mo" said Mr.. Sage; "f had I would have re-
signed ny position. would tender 1t Immediately
Turning 10 another member OF the Board Mr. Tacott
asked the same questions and received negative replies
Thus the examination proceeded until all the members
bad testified except Mr.. Osborn. Wien he was ad-
dressed he stated inasmuch he was the youngest
member Of IL. Board and against whom the suspl
the President been directed he wished TO say
emphatcaly that he had not been short" OF Pacinc
hal. except broker for the account OF regular GUS
toners In proof Of his assertions he would ask the
Secretary. Theodore Johnson, TO read the following
letter and then 10 lg- tae files Of the Company
where copies could be obtained by the officers and
directors, If they wished:
PACIFIC NAIL STEAMSHIP COMPANY,
Convl No. 67s Fl.th ave. Nov. q, 1874
G J. OSBORN esq. DeaTST: Referring TO the c0nVer-
The Pres1rDt OF the Pacific Mail Steamship Company IN
reference 'to short safes Oh & Ine ssoch d a. ' m p,i
cisIn on you reflection beg 10 dlr with you Tor
the Following reasons: You have simply acted as "a
broker and As y broker would who lad responsible
customer; aud besides your WORTHY Fresuent eaDot
lave forgotten hat the "shOrt" account reierred 10
arose from deliveries of STOCK on call- on tho same
Al 10 and upward sold BY hm. the half nteres, Ia Wcn
was ubsequcntly assumed by felt had slsnt
claim 20 correct from the party referred 10
Tor the further that you know was induced
sell my stock IN tie Company upon MS statement
OF almost wOrbes5ness, cOuntmel 40 IL was " Inc
published report OF 5teDDius COmmttee ana mas
much gentleman originally became director AT
at the annual election ia May, 1873, ana
was subsequently reelected IN May 1874, through my
votes IN pursuance Of previous agreement wIth
Aud bound further, IN justice 10 GiLD, 10 say
that eyerytDng that has uce appeared hds OEy tended
confirm the correctness or his ~ regard 10 the
property. You may communicate Lnis " Mr. =.
Yours, JAY GOULD
II q bomb had suddenly exploded In midst OF the
Board the effect could not have been greater The
soene yas essentially dramatic, aud would have done
credit 10 any stage President Sage declared that
letter was false Turning hastily around he continued
"There has been enough OF tlis iooishness Lets at
tend 10 the business OF tae Board" Turning 20 Mr..
Osborn he said: "I didn't mean you at ALL"
Mr. Smith Immediately sprang 70 his feet ana garlng
dercely al Mr.. SAGE shouted DID you mean me- sir'
mo" said Nj. sage, Z" didn't mean either oi you
This Was an xpected reTaction buta director WHO
lad previously told that Osborn anu 5nita were