Herald and tribune. [volume] (Jonesborough, Tenn.) 1869-current, 1886-04-15
PAN-ELECTRIC.
ATTORNEY GENERAL GAR
LANDS PART.
The Whole Scheme Clearly Exposed at
the Meeting of Bell stockholders
In Boston--Mr. Garland's
Queer Course.


The sixth annual report Of the Board |
of Directors of the Bell Telephone Com
pany was read at the meeting held in |
Boston last week. 1t shows that while |
1885 was not marked by the increase of
business which the company has enjoyed
in previous years, the licensed companies
have more than held their own The re-
port goes at length into the history of the |
Pan Electric controversy. The Pan
Electric Company, it says, was organized
in 1883, with capital Of $4,000, 600, the
ostensible basis of value for which was a
group Of patents, some of which related
to telephones, OF one Rogers These
patents the report says are perhaps the
most palpable infringements upon the
Bell patents that any one has yet attempt
ed to rely upon; there is not even the
pretence of any invention prior to Bell,
and the inventions are of no Importance
whatever.
The principal stockholders were lead
ing politicians in the Southern States, and
their operations, so far as the telephone
business goes, have been mostly confined
to that part of the country. These gen.
tlemen received large blocks of the capi
tai stock, paying nominal sums in money
for the same. Sub-companies were
formed, from whom bonuses in cash were
taken for the right to use the Rogers
inventions in different places, and addi-
tional blocks of the stock of these sub
companies appear to have come to the
promoters. On January A, 1884, Mr.. Gar
land was asked for an opinion on the
Rogers patents. Mr.. Garland replied
upon the following day, giving what
from its tone purports to be q profession
al opinion, to the effect that he had care.
fully examined the Rogers patents, and
that he was clear that they in no way in
fringed the Bell patent. Nothing con-
tanned in his letter indicated that he was
interested deeply, as a stockhOlder, in the
market value of the Pan Electric stock.
Upon this opinion largely, it appears, the
bonuses were obtained from sub.compa.
nies, and efforts were made to sell Pan
Electric stock.
The first way in which the influential
names were to be used was in getting
money for supposed rights which have
no value. The second was to get the
suits of the Bell Company against the
Pan Electric Company and associates
stopped.
After Mr.. Garland became Attorney
General and the other Pan Electric lead.
ers received important positions under
the Government, it was decided, without
the aid of any statute, to ask Attorney
General Garland to order suit brought
to annul Bells patents, on the ground
that he obtained them by fraud and that
he was not the first inventor.
Mr.. Garland declined to act, but left
Washington for Arkansas, and his next
in office, Mr.. Goode of Virginia, within
a day or two of his departure, ordered
the suit brought, not in Massachusetts,,
where the Bell Company exists, but in
Memphis, Tenn.
The report continues
Gas soon as Mr.. GOode ordered this
Government suit, counsel for the Pan
Electric appeared in Baltimore before
Judge Bond, who was about to hear our
application for injunction against that
company, for the reason that the Govern
ment suit was valid objection to a pre-
liminary injunction, thus exposing the
motive Of the whole movement This
request was not granted, restraining
order against the Pan Electric Company
was issued, and the Court will hear the
case in due course.
1.-THE President, finding that Mr.
Goodies action had been taken without
reference fer information to the Depart
ment of the Interior, suggested to the
Department of Justice that 1t would be
better 10 conform to usage in such mat
ters; and the suit was withdrawn. A
new request was then preferred and sent
to the Department of the Interior for in
formation, The Secretary of the Interior
Mr.. Lamar of Mississippi, gave hearing
lasting week, on the question of the
Government suit at which Messrs Dick
erson, Smith, and Storrow appeared for
us. Without considering the merits of
the questions involved he advised that
the Government had right to bring such
suit, and also that it should do so, ap-
parently because there was an allegation
Of fraud involving officers of one of the
departments, which, for some reason not
explained, he thought could alone effect
ually be investigated in suit by the
Government itself; but he advised that
the Government should conduct its own
case and at its own expense.
"On the 1st Of February our suit for
injunction against the National Improved
Company in New Orleans, the associate
of the Pan Electric Company, was reach
cd Once more the counsel for our op.
ponents appeared. with the request that
the case be postponed because the Secre.
tary of the Interior had advised the Gov.
ernment to bring suit against u.s. and that
other cases ought not to be heard until
that was decided
at is easy to understand the injury to
the Bell interests that would follow If the
United States courts should refuse us oil
protection against infringement until the
Government could try over again and de
termine all the questions relating to the
priority of the telephone invention, which
~ hao tuNCu uo CiEht yUNlo VI aluuOus
litigation to bring to their present condi
ton of readiness for the Supreme Court.
..,Phe Court at New Orleans to stay
proceedings, and the arguments have JUS
been heard.
Here, then, the whole programme lie'
exposcd--a plan to sell rights that had nc
value ON the strength of prominent
names; aplan TO wreck our property by
stopping our suits, pending years Of
wholly unnecessary litigation; plan tc
deceive the public into the belief that thu
defeat of the Bell patent would confel
value upon Pan. Electric stock; plan Il
inveig Mr.. Clevcland's Administration
into support Of this scheme.
IF such plan can succeed, what in
terest In this wide country is safe from
IN infamous attack? If any doubts hav,
existed as to the expediency Of statute
permitting such action on the part of tn,
Government, the proceedings Of the Pan
Electric associates. and the fact that the,