New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1885-01-24
WORTH LESS THAN NOTHING
AN UNpRoFIrABLY MINING ENrERpR,sr
Mr.. BUTLER SUING TO RECOVER HIS Lossrs .
NINE LAWYERS IN COURT.


NINE LAWYERS IN COURT.
Part /. Of the Supreme Court, presided ov..
by Justice Van Brunt taken possession OF ysssrs
by nine lawyers who have entered upon the TIA, -
case that promises to last for weeks This e -
action brought by Frank Butler, for himself ana ~
the assignee Of the claims Of eleven other STOCKHOLDERS
the Excelsior Water and Mining Company, Califorss
corpo caon against Richard p. Lounsbery Ben All az
James d. Haggin and Wells, Fargo & Co. France. =
Bangs and Lucien and Clarence Birdseye appear ss
Mr. Butler; Joseph H. Choate for the firm OF L0unsbesv
e. Haggin, stock brokers Of this city, and James n
Carter exJudge Ashbe Green, ex-Recorder Smith ana
william C. CULVER for the individual memte rs Of the
firm, while Hamilton C0lerepresents Wells Fargo Co.
Mr.. Butler says IN his complaint that James b. Hag.
gn of California and generally rePued to he Jana
stated by the defendants "a man OF great wealth
large experience business and connected with mining
operations, and a Of great skill ability and ineg.
rity" He is the father Of Ben Ali Haggin and uAs
father-in-law Of Mr. Lounsbery. Mr Butler charges
thahe elder Haggin and is the vice president ands
director OF Wells, Fargo Co., Colorado corporation
authorized to buy and sell gold and silver bullion etc.
and deal In mining stocks This last business The
company carried In this city, under the management
Of it's assistant secretary H. r. Parsons The Excelsior
Water and Mining Company the complaint sets forth
Incorporated March o. 1877, with its heaiquar-
in San Francisco Its capital stock was $5,0O000O
10000 800 shares The number Of shares then issued
38,464 and the total was TO be 43,320 In 1879
Mr.. Butler asserts the defendants fraudulcntly
spred with certain directors stockholders officers and
employees OF the Excelsior Company, control Of
its pt and increase IL by dsposing OF
price its real value and subsequently TO de-
press the market price enable them again to
possession OF the stock. thereby detraudng the pur
chasSs In APRIL 1879. In pursuance OF this conspiracy
the defendants and their cOconsprators purchased tho
principal part OF the stock and secured control OF the
ceeed manage the affairs of the corporation Tor their
own purposes OF intended fraud on May l3 1873, the
ifai fpopa Tram
each share OF the old stock turned In by the holders
and two OF the new were issued sose sSyoo shares e
1888 were divided pro rata among the stockhoiders
defendant represented that the stock had been fully
The next move, Mr. Butler :says was to put this
STOCK ON the New-York market, and this was done
through LOunsbery a. Haggin and Wells Fargo 20.
Lounsbery Haggn appeared as the authorized agents
OF the Excelsior Company and said they had stock fSr
private SALE but that the books would be opened for pub
alleging that the Colorado corporation had nosted other
mining stock successfully The bpoks were asooralng
have nothing TO do with mining company unless IL were
Se I be- %e aa5aSe sa agq 10 n s the Sh"s
large amount Of the stock and Wells Fargo q Co and
stock and loaned large OF money Ia order u Obtain
purchasers These firms represented that the STOCK was
intrinslcay valuable that about all OF it mai been sod
would be put the market unless at high
price and that Wells. arso Co. realized large profits
pretended that tho Excelsior mines had already yielded
more 100000 and would produce atalow estimate
for expenses to p: $4JSso that the funded debt was
only s25oooo at 10 per cent interest, to be paid In b..
debts that since its organization the company bad PAID
sixteen dividends each at 20 cents share ana would pay
dividends for many years; and that after mining opera
tons had ceased the revenue from the SAFE OF the com
pany's water and merchandise rents would he least
100000 year Tie increase of the earita stock was
concealed from Sir. Butler, he AYERS; nVldshds Oh
Sl9l Gg2 we're declared no, from earnings but from
the proceeds OF the sae OF bonds and from borrowed
money, while large hoating DEBT was formed, as no
company was borrowing money and overdrawinz It's ae-
comnt i'm the BanK OF California by exchanging checks
with Vice President Haggin In 1881 the company ceased
10 nav dividends after making thirty saying that ms
~ sing 10 necessary changes in working the mines
and that when dividends we're again paid they wond 20
from 40 to cents would have been the case before
hui for the desire accumulate surplus But instead
OF being with resumption OF dividends MT Butler ana
troubled with OF 81 and then with three
Of so cents share the Object OF t9e Sompsn,y
that stock OF person not paying On assessen. On
his stock might be sold certain time be stock
of those the assessment was cold out aud
purchased by the defendants
finally became aware by getting hold OF the companys
books He found he says. that James b. Eaggin had
1S fhe enscHs wien he had W.T.,
the Bank OF California allowed Gn M SS STSm
issory note for $2S60o0 at per cent componadlas
and So 900 at per cent. Mr. Haggiu. Mr. Butler as
serts finally gave the company general release oe
himself and AZ assignee on lis investments and
ments He says that the stock is worm 2 per cent css
absorbed by the defendants Only the mine itself Is left
II is situated a few miles northeast OF Sacramento in
Marysyilie IL can be worked only by hydraulic power.
and te company been enjoned by the city from the
se of this means water has formed IA, Inc LOO
feet wide 500 high, and two mos long leading 70
Marysyile and Thereby the gravel from the mine has
uupon the plain wheron the city Is Situated 70
its injury. ,. 49,.
and con spacy. that they haze acted IN good iah
and that the has proved failure In siteof tler
best endeavor. The company in July 1879 they say.
was prosperous according the report made by mining
engineers and by the company" 80,
The day occupied in obtaining jury ana VIII tho
opcnng OF the case Tie trial will be resumed Oh Mon