Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1882-10-18
A STOCKHOLDERS WOES.

The Bill for the Appointment of a Re-
ceiver for the Chicago ''HeraId"-AIlee-
ed Dishonesty in its Management.
CHICAGO, Oct. 1.-THE bill filed by w..
Scott Smith, of Washington, against the
Chicago Herald company for a receiver,
makes some startling allegations. It sets
forth that the capital stock of the COM
pany is $4,000. He owns ten shares of
paid up stock of 800 each. Eight hun
dred and thirty shares are outstanding.
The company's personal property is worth
$4,000, and its good will, etc., $4,000 if
the business is properly managed. A. F..
Hatch is president; James w. Scott, score
tary and treasurer; r. w. Rice, O. F. Adds
and w. D. Eaton are directors,
but Eaton has long since ceased
to act. In July, 1882, Hatch,
Scott and Rice being majority of the di-
rectors, assessed the outstanding stock 80
per cent, each of them then owning two
shares of stock. They conspired to get
the rest of the stock by this means, claim
ing this assessment was necessary to enable
the corporation to carry ON its business,
and it couldn't otherwise pay its debts.
These statements were false, and put for
ward to make the stockholders relinquish
their stock. The Herald had been an adj
ministration paper, and consequently got
q large amount of government patronage.
$4,000 worth at least-and its patronage
was almost wholly among supporters of
the administration. Its stock was largely
owned by United States officials, and they
alone contributed money to its support.
Hatch, Scott and Rice began to
attack the administration to fur
Their their schemes and compel
these officials to give up their stock, know
ing if they held it they would lose the good
will of the government, consequently the
papers patronage fell off, and the stock is
greatly deprecated. Some 400 shares
have been surrendered gratuitously to the
conspirators, who now have 700 shares. all
secured at grossly inadequate prices.
They have only tried to collect the so
per cent assessment from stockholders
who refused to give their stock to Hatch.
The bill states that on the 18th of August.
mortgages we're executed of $4,000 to II.
W. Wolseley and $4,000 to Hatch; that
the Indebtedness is fictitious, and was
contracted to further depreciate the value
OF the stock and compel surrender; that.
these mortgages were never recorded.
Scott told complainant unless
he would accept 10 cents on
the dollar for his stock the mortgages will
be foreclosed and the stock rendered val
ueless. The business of the corporation
has been confined entirely to Scott, who
has been recklessly extravaganza, and
claims the corporation has expended $780,
600 since May, 1881, of which $4,000 have
been paid for the editorial work and cor
To-,
of this amount hassbeen expended. Scott
also says that since the 4th of last month
the company spent S., 900 more IL q its in
come. The bill prays that the owners Of
those mortgages be restrained from foreE
closing; that the court appoint receiver
to take charge of the property to prevent
waste, and an account be taken of the
amount the officers of the company ~
owe it, and that they pay whatever they
have wrougfully used or appropriated of
its money.