The Memphis appeal. [volume] (Memphis, Tenn.) 1886-1890, 1886-08-17
THE PAN.ELECTRIC SUITS
ATTORNEY GENERAL GARLASD'S
ANSWER TO TIE
Bill Recently Filed BY Rogers Tor a
Settlement of the Affairs OF
the Company.

Harris and others, Tor settlement OF
the affairs of the Pan Electric Tele-
phone Company. Mr.. Gar and, in bis
answer, denies 10 detail every material
statement in the bill, and calls atten-
ton to "tbe scsndalous and imper-
tinent matter in the bill" aud says he
must decline to answer such portions
unless the court directs him to do so.
In concluding his answer the At.
toIney General says
Mr., GARLAND's ANSWER.
"Tbat being invited by one or more
of his codefendants to become inter-
ested in aiding to develop certain in
ventons CT the complainant, he did,
on or about February 15, 1883, attend
meeting OF the parties interest at
the residence of the complainant, on
Four and Half street, N. W., in this
city, aud that except this he attended
only two other NEE ings, and that it is
exceedingly probable that there are
many delails OF this business whereof
he is wholly uninformed, and as TO all
such matters he would rely with more
confidence upon the books and re 1rds
of the company than up his own
huOWlCubCj budO1 EO 40 hC ID nv q cS
all the agreements OF the parties
as between themselves relative to this
business were reduced 10 writing and
are fully and completely set out in the
contract dated March 13, 1883, which,
on his behalf, was executed by his at.
torney in fact, Ishau G. Harris" The
Attorney General further AYERS "that
he hts paid the sum of money therein
agreed by him to be paid and 10 addi.
ton thereto some further sums or as
sessments made, and all that were
made by the parties to the contract
named, and in pursuance thereof and
for the purposes therein set out. And
he entered into no other agree
ment OF any kind in the prem
ises with the complainant or anyone
else. And be further says that he
was impre by the apparent useful-
ness of the inventions, and had great
confidence in the legal validity of the
patents and believed that the validity
would be judlcia ly sustained in any
litigation instituted for the purpose,
ana that in that event they would be-
come very valuable if honestly man.
aged on business principles; that until
their legal validity was thus judiCially
established it YVES by himself and h s
codefendants de med unwiss and i'm
proper to issue the ock of the CON-
pany which had been duly and legally
chartered, and to which company said
datsnts had been legally assigned in
pursuance Of the agreement that
the written contract hereinbe-
fore referred to, the oieinal
whereof will be duly exhibited On the
trail of this cause; Was lntended~and
does carefully guard against such pre-
mature issue Of sciip for ths stock,
by providing that all of the stock
should he held jointly. He submits
that said contract does not constitute
psrinership, but that it is an agree
ment between the parties thereto as
to the obtaining of charter for speci-
fc purposes and for the management
OF certain interests thereof when
chartered and organized Hereunder,
and he submits to the court the
proper legal construction of sad con-
tract, that under and in pursuar ce OF
said contract, the Pan Electric Tele.
phone Company issued certificates
showing that the different parties in
interest were entitled tos certain num-
ber of shares of capital stock OF the
Pan Electric Company Of the part PAR
value of 500 each as soon as the va
lidity OF the patents is judicially de-
termined in any litigation instituted
for that purpose. But this certificAte
is not transferable except with the
consent of the president and secretary
of the company indoissd hereon."
He further says that the complainant,
instead of devoti g himself to the per-
fection of the Invention as by his con-
tract he wos bound to do, sold inter
ests in his stock, as admitted in his
bill of complaint and in sundry other
instances bes s II oselhere nadmitted
in patent violation OF sad contract
and sgsinst the interest of the COM
pany that finding be could not per.
suade the defendants to accede TO his
wishes, be procured many false and
malicious statements 10 be published
in the public press of the country,
both as 10 the defendants and az to the
business OF this company. He also
AYERS ''thst the utttr disregard for the
complainant for his obligat one, as
manifested ty his violation of his con-
tlact as we'll as els general conduct
her, in set out, renders him an wholly
unreliable person with whom to have
any business relat ons whatever; and
this defendant, having become fully
satisfied by tbe e gross mieconduct OF the
complainant that the business of the
company could not be properly and
desirably managed, bad decided in
February last to give away his stock
in said Pan-Eleclric Telephone Com
pany and be freed of all and every as
socistion with said complainant, and
hsd prepared to consummale this pur-
pose when Investigation of this COM
pany was instituted by the House of
Representatives OF the Cor gress Of the
United States and he deemed it proper
to continue in ststu quo until that was
concluded; aud such investigation
having been concluded, this defendant
now unites in the desire CT the COM
plainant to close out and wind up the
business OF said company and whether
the court, alter consideration OF the
contract, shall regard and trest this asso-
citation as partnership or corporation,
there should under said contract be a
full accounting between each member
and the company, including the pro-
ceeds OF any aud all stock or interest
cold in violation Of said contract and
ample provision made for the payment
of any liabilities of said company, and
if necessary, to secure dissolution
and winding up Of such organization,
he ssks that this bill may be deemed
and considered cross bill asking for
such relief. And this defendant,
waving and renouncing the bsne fits
and advantages to which he may be
entitled Of such accounting, aud all
right and benefit Of such compapy,
brings into court here the cert ficate
for his interest in said company, and
while be is reedy and viii ing to
stand by and pelflTm such decree as
the court shall deem meet and equit-
able in the PREMISE, be asks thai ST
ter the settlement Of all liabilities of
said company by the application