New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1890-11-01

RAILROAD INTERESTS.
AGAINST THE READING COMPANY.
A BILL IN EQUITY FILED DY LARGE HOLDER
OF THIRD PREFERENCE INCOME
ARGE HOLDER


OF THIRD PREFERENCE INCOME
MORTGAGE BONDS.
PHILADELPHIA oct 3I.--Counsel for John Lornie to-
day filed a bill i'll equity against the Phadeipha ana
Reading Railroad Company and the Philsdelphis ahd
Reading Coal and Iron Company Mr. Lornic is a large
holder of securities OF the Philadelphia ana headihe
Railroad Company. and is citizen Oh sco'ahd ana
subject of Great Britain lie enters suit on behalf OF
himself and all other holders Of bonds who may wish
IA take part i'm The litigation lie says that prior 10
lime 1854 he was a large holder Of securities and
bonds Of the Reading Railroad Company having az
that time securities Of the company TO the amount OF
mo han 81 OOO, 900 which securities were liens upon
the property and franchises OF the railroad and coal
and iron companies
lie then proceeds TO outline the failure OF the Phiia
delphia and Reading Railroad and the appointment Of
receivers saying that he relied upon the plaii 6f re-
organization and the faithful carrying out oil the plan
by the Board of Managers OF the Reading and the
trustees and, relying upon the terms and provisions
OF the mortgage to be created Hereunder, lie paid
the assessments as required OF lin, and sur
rendered his securities 10 the Board Of RccOnstruc-
ton Trustees, thereby releasing his lien and claim
against the assets In the hands OF the receivers, anu
accepting new securities under the plan Of reorganza
zion, and is the holder OF such securities to the
amount of nearly ~ 100000 Accepting from the
Philadelphia and Reading Railroad Company and the
Board of Reconstruction Trustees the bonds known as
The third preference income mortgage b0nds' secured
by mortgage given by the Philadelphia and Reading
Railroad Company and the Philadelphia and Reading
Coal and Iron Company 10 the Pennsylvania Com
pany for assurances Lives and Granting Annutes,
dated January 81, 1858. The bonds held by the
plaintiff amount to S:I54,OOO. The terms OF the
third preference income mortgage bonds were
especially secured by mortgage and also by lien
upon The net earnings Of the railroad company and the
coal and iron company ont Of which net profits, earn
ngs, and receipts, when earned, the coupons
Of the holders to be paid.
The plaintiff alleges that tile statement OF the bust
income. earnings and profits Of the railroad com
pSuy from June /, 1887 to November 80, 1888, rem
dered the trustees, according to the terms OF the
mortgage erroneous false and fraudulent state
ment as far the rights Of the holders OF the third
preference income bonds were concerned in that 1t
puposely concealed the fact from the bondhodeis
that the Reading Railroad Company, under true ac-
counting of its income receipts and profits for the same
period. had earned more than sufficient to pay the
interest due February l, 1889, upon the income ponds
poses other than those required by the terms OF the
mortgages. . ,,,,,, ,
The plaintiff asks the court that the Philadelphia and
Reading Railroad Company, the Philadelphia and
Reading Coal and Iron Company and the pennsylvania
Company for assurances Lives and Granting An
nuities may be required to answer the allegations III
All