New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1881-01-26
THE COURTS.
. .cs,,, M rIrrJE pITTsBJJRts.

.
fosSEs IN LITTLE PITTSBURG.
wxpa,, usyoRTUNATE NEUTRALITY-SUSPICIOUS.
&c Nix. CiiAfTgE AND MR.. MoFFATr WITH
raAUp.
800 10 ,:,vcstofs in mining stocks has been begun
- ,se supreme Court by Artemus I'll. Holmes. the
~ 49,. aesnst Jerome RaUChaffse as president, ana
ssy,l N Moa,., r.. vce-president, OF the Lttle
I, su..h,ra Consolidated Mining Company. James N
NH wing Shondy are attorneys for Mr.. Holmes lne
cc,pal au stion to be determined IN case tho a'eea
-. ~ the complaint are proved is whether the con-
I,,ne officers Of mining company can be MADE per
,.,,v liable In damages for knowingly making Iais'
as the value OF their mines 70 in
srce the Investment of capital
& NJ Holmes alleges that Messrs. Chahee ana mona'
.n The majority Of the company's STOCK anu hau ao'
,ou,e control over the companys properly 'ua' WV
~ tine 500 100000 Of capital stock were issued
NIL, ., them either inty individually without
..,v receiying any consideration therefor ex-
en-, transfer Of the mining property the value OF
s.h AID not In reality exceed $lioOOooO MI Holmes
,,rher that the larger part OF the pocket OF ore OF
80, and lead on the companys property covering one
80 =, An acre had been worked out and exhausted
'nu - ,ns formation Of the company; that the de.
s..,s ,nvited large party OF persons from New
rd other places to visit Leadvlllc to inspect the
N..v and that BIZ means Of the statements aud rep
atoms made TO such persons by the deendants
- ,ner agents and employees ct Leadye. they caused
h persons to believe and toreport TO the public after
their return from Leadve, In substance among other
,,nrs that there were several millions OF dollars OF re-
yes of ore In sight that only a small portion Of the
.,ns had been opened or developed; that there was
reason TO believe that the bed pocket OF ore ex
tended under the whole. or n"arly the WHOLE OF the
nroperfy of company consisting OF twenty acres ana
inward and that such report was brought 10 the atteh
: tion Of the plaintiff
hon rort M
<o,ns that in addition TO the above he were made
~ hun by Messrs Chafee and Mo1att to induce him TO
purelase the stock; among others that there were
reserves or bodies of capable OF measurement ald
ASSAY then exposed to view In the mne OF the value OF
over $1,000 900 and sufficient TO pay dividends OF
100000 Der month for least three years. that the
property was one Of the richest and most valuable In The
world and was worth much more than $40 share
and that IL could be procured at that price
only from him. Mr. Holmes says that he believed THESE
concentrations which the only source Of nforma'
ton on the subject that he bad and that on the strength
OF them he invested $4,000 in tho stock at $50 share
These representations Mr. Holmes now declares TO be
ntrue he alleges that tho defendants them 10 be
untrue at the time and made them TO deceive aid to de-
fraud him that value Of the reserves OF ore exposed
10 ye,y in tho nine did not exceed 81 100000; that
there was no to believe that tue bed OF
pocker extended beyond the drifts or crosscuts
that ad opened; that the stock not really al
stantial investment In June. 1872 the defend
ants, began TO take out the ore exposed to view
and to pay monthly dividends OF so cents share until
Msreb 1880, when the became exhaused the CON-
pany ceased 10 pay dividends and the stock became of
only trhing value
Mr. Holmes also bases his suit upon whathc claims to
have been the made by j. c. Wilson,
the general manager OF the company IN Ills statement
10 the Executive Committee in Ncw-York on January
g. 1880 which the defendants had printed and published
For second cause or action Mr Holmes ses lOrth the
publication by the defendants In june their pos
Condition and prospect. of the quite glowing IN
alleged falsity those previously enunnrn ted
Mr.. Holmes that In July. 1879 Messrs Chafee and
MOhatt repeated their former representations to him.
showed him the prospectus and assured hun that the
statements IL contained true, and persuaded hun to
buy $50 additional shares OF the company,s stock
The third OF action is based CHIEFLY upon the re-
port made by Mr. Chace In August 1879. to the direct
ors In this he declared that the product OF the NINE
had been wholly from development work, and that ut
that company mad Of upon the north
ern 800 feet square OF the Sew Discovery alone equal
at least 10 $4.000.000 or $5000,000. The COM
plant also recites the reports made ny Manager
Wilson at various times. ,u For MI, the t, par
AYERS the defendants had Manager Wilson tend false
letters and kilograms from the mine as 10 It's condition
On the personal OF the president and vice.
president that these reports ard kilograms were tiue IN
OF the capital stock which he paid So 12S 81 Mr.
Holmes also that in this In the others the
de, endans mised and deceived him, that they might
deiraud him of his money He that lie offered this
sock back when he discovered It's pntthe
defendants would refund his money. For his losses
arsag from the three causes OF action MI. Holmes
asks $4,000 damages. The answer has not yet been
served.