The morning call., 1893-03-03
:FOX'S BLIND POOL.
The Battle for a Bonanza
in Slack's Court.
WAITING FOR JOHN MACKAY.
A Director of the Justice Mine Tells
What He Knows About Mining
Stock Manipulation.

@The trial OF the accounting suit of Oscar
G. Steele. the original owner of the ground
occupied as q mining claim by the West
O.. Consolidated Virginia mine, against Nj. w.
Fox and other directors of the corporation,
was resumed yesterday before Judge Slack
NJ. J. Mertens Of the firm of Joost, Mer-
tens 81 Co., q son-in-law of Superintendent
Steele, who on his cross examination by Mr..
Baggett denied that he had been used to
trap Fox, testified to several interviews had
: with Fox lew days before Steele brought
his action.
The first interview was held in the Office
of the West Consolidated Virginia and
California in this city. Mertens asked Fox
what Steele's interests were in the pool, and
Fox informed him, after some calculation,
that there were between $1,000 and $4,000
shares. Witness asked Fox where the
pooled stock was, when he reDlled that 1t
was intact ia his hands, and that no money
was coming to Mr.. Steele, as no sales OF the
= stock had been made.
= Tue second interview between Fox and
the witness occurred on the following day.
Meanwhile witness had examined the stock
q books of the corporation and had seen that
only ten shares Of stock stood IN the name
Of Mr. Steele.
Witness asked Fox, who was president,
for an explanation, Whereupon Fox said lie
mad been mistaken in the statement he had
made al the preceding interview as to the
number Of shares that Mr. Steele owned;
that Mr.. Steele had been giving large orders
on the pool for his stock, which accounted
for the small number OF shares then stand
ing in Siees'S name.
Witness then asked Fox whether there
was not any money in the hands Of Brown
. and Fox belonging to Mr.. Steele from the
operations of the pool, and he replied that
there was not.
TIE last interview between the witness
(Merens) and Fox was on a Sunday in June.
Fox then informed witness that all OF the
-, pooled stock was tact; thathe had figured
mp Mr.. Steele's interest since their last in
teryisw and that there was left to Steele go
shares Of stock
Fox again repeated hatthere was nomoney
.. on hand for Mr. Steele.
Witness asked Fox how it happened there
was money on hand for Mr.. Steele and
no stock. Fox answered that he believed
Nj. Steele had given orders which absorbed
his iulelests-One to s. I. Curtis fer $3.50
shares and the other to himself lFoX) for
l.. $50 shares
Witness then asked in what manner
Steele mad disposed 0f all his interests Fox
replied that he did not know, but that il
=. Steele would keep quiet he would make
large amount Of money for him.
Witness asked him how. Fox said he was
not at liberty 10 make 4 statement to any
one as to what was gong TO be done in
reference 10 the marketing OF the stock,
ana that If be vas not interfeFed with he
would shortly make deal that would make
Mr. Steele a large amount of money.
FOX stated further that about two months
previously Mr.. John w. Mackay was in
San Francisco, and he had informed Nackay
that The Consolidated California and Vr-
ginia Mining Company had extracted large
amount Of ore and had taken large
~ amount OF money out OF the mining claim
of the West Consolidated. and that he
wanted him (Mackayl to make settlement.
Mr.. Mackay Informed him in reply that
the matter should be Investigated and that
be (alr Mackay) would give w. T. Baggett
. en opportunity 10 look into the matter Gnd
that II Baggett would go to Virginia City,
he could, IN conjunction with one Of MI
Mackay's men, survey the mine and ascer-
tain the facts OF the case.
%: Fox sent Baggett TO Virginia City, and
upon Baggetts making an application for
permission to examine the mine he was in-
formed an order had been sent by MI Flood
forbldding him admission, and Mr. Baggett
was compelled TO return TO San Francisco,
=. where he had been patiently awaiting Mr.
p: MacEays return ever since.
.. II had now been over Two months, and
~ every one would have to walt until Mr..
Mackay returned before he Fox could tell
what would be done u that direction.
Fox also told witness at this interview
that all he recognized as belonging 10 Nj
Steeel OF the sleek was $50 shares, and that
if Steele wanted to withdraw from the pool
be could do so by paving the pro rata il
Fox also threatened. if The pool was
broken, that he would slap on an assess
ment Uf % cents per share right away. Fox
Informed witness that a certificate for Q, 500
shares standing in the name OF MI
Curtis was unIndorsed. and that he knew
Of way 10 have Mr.. Curtis indorse that
stock and give an order for it to Mr.. Steele
He added, however, that Mr. Curtis claimed
this stock.
: In the afternoon the plaintiff. Steele, was
again on the stand, and testified to various
eonversatlo lions he had with Fox and Brown
IN MS endeavors to reclaim the stock from
;. thsir blind pool.
Steele said the ore found by him would
have justified the purchase of the stock by
;specuiators had the stock OF the West Con-
solidated Virginia been listed.
The repairing Of the shaft was for the
dement, OIL both mines, though the cross
Cutting and upraise work was for the benefit
Of The West Consolidated. The improved
venulators benefited the Andes. The West
Consolidated was never the ground of the
Burning Moscow, out of which some rich
ore had been taken in early days.
+. AmlToux, director In tho Justice
Mining Company, testified that MIR. Fox
had frequently talked to him about the
West Consolidated Virginia mine and
stated that 1t had body of rich ore. The
STOCK had good reputation on the street
among the people who knew about the
strike
Had the stock been listed on the ex-
hgure. Witness owned ten shares In the
mine, which he had purchased in order to
become eligible as a director.
Mr.. Fox had informed him that there were
some big men behind MIN in the manpula-
ton Of the mine and that mining stock could
be honestly manipulated
On his cross-examinatioh Mr.. Amiroux
said he had not heard that Mr.. Fox had
agreed to refund whatever money was paid
TO him by his friends for West Consolidated
Virginia stock in case the stock did not sell
= for more than they had paid for it.
The ore now being taken out Of the
Justice mine would assay on an average
about $50 ton, yet the stock was only SELL
ing Tor about % cents a share. IL mining
stock was properly manipulated 1t made no
difference what was in mine.
The reason that Justice stock was not
selling at higher figure was that the loca-
ton was not thought as well of e the mines
situated In the neighborhood of the Consoli-
dated Virginia, the ODhir aud the Mexican
During the redirect examination of MIR
Amir0ux ii tran spired that the letter purpOrt
ing to be written by Fox instrueting Steele
not 10 show Turnbull the developments in
the West Consolidated but to let him see
everything III the Andes was written by
Brown, who had signed TO it the name Of
Fox.