The herald., 1893-09-14
STOCKHOLDER sWOPPS SUIT,
He Wants an Accounting for
Many Millions.
Sensational Charges Against North
ern Pacific Dire ct0rs.
How Willard, Colby, Hoyt and Abbott
Enriched Themselves at the Ex-
penss OF the company-Ret-
ribution Demanded.
BY the Associated Press.l

BY the Associated Press.l
New YoRK, Sept. 13.--John Swope
of Pennsylvania, ona Of the stockholders
of the Northern Pacific railroad COM
pany, on behalf of himself and other
stockholders, has begun an action in the
supreme court against Henry Willard,
Charles L. Colby. Colgate Hoyt. Edwin
II. Abbott, the Northern Pacific rail-
road, Thomas F. Okes, Henry O. Rouse.
and Henry @. Payne, its receivers, and
the Chicago and Northern Pacific rail-
road company. to compel the individual
defendants to make restitution OF mil
lions of dollars which il is alleged the
Northern Pacific Railroad company has
been deprived OF by means of fraud.
The complaint alleges that Willard,
Colby, Hoyt and Abbott in September,
1889. owned the land at Harrison street
and Fifth avenue, Chicago, upon which
there was being constructed the Grand
Central passenger station, and also con-
trolled the Chicago and Great Western
Railroad company, the Bridgeport and
South Chicago Railroad company, and
the Chicago, Harlem and Batavia Rail-
AOou Cuupduye WuiCh OpStoted hhCo Va
railroad within the limits OF the city OF
Chicago. The value Of the land men
toned and the railroad properties are
1890. Swope charges that these four
men in September, 1889, conspired to
defraud the Northern Pacific company
directors, all this Chicago railroad prop
ortu nd In nx,l. fop sx1a nf 20
value, SO they could make an exorbitant
fraud the Northern Pacific company.
By the scheme they received about
$1S, $780, 600.
For the purpose Of Disgusting the
conspiracy the Chicago and Northern
Pacific Railroad company was organized
by Willard, Colby, Hoyt and Abbot in
November, 1889, with q capital stock OF
S339, 900. secured by a mortgage on the
property Of the Chicago and Great
Western company. II is alleged that
$l9, 950, 900 worth of bonds were deliv-
cred to the four men in question in pay
ment for the different properties men
toned, and shares of capital stock in
the three railroads in Chicago were as
signed to the Farmers Loan and Truet
company, as trustee. Willard and his
associates then made to themselves, as
owners and in control of the Wisconsin
Central company. a lease for SO years of
all the property of the Chicago
and Northern Pacific company,
subject to lien of $30,000,000 mort
gage and other outstanding mortgages.
Then the Wisconsin Central company
was leased to the Northern Pacific COM
pany on mortgage for 80 years. Viii
lard was then chairman of the Northern
Pacific company and two of his associ-
ates were directors. This was arranged
go that, in addition to the profit of
SIC, 1850, 900 already realized by them in
bonds, they would be entitled to about
one-third OF the profits to be derived
from the operation Of the Chicago and
Northern Pacific az soon as it became
self-suPporting.
The purpose of the suit is to have
them restore to the Northern Pacific or
the Chicago and Northern Pacific $10,-
$4,000 bonds and "a $50 shares of stock
obtained for the Chicago properties.
An accounting is sought at a fair market
value of the property at Harrison street
and Fifth avenue, Chicago; also Of the
three Chicago railroads, and after de-
Quoting $1,049, 600 encumbrances upon
that railroad, that Willard, Colby, Hoyt
and Abbott be adjudged to deliver to the
Chicago and Northern Pacific company
all the bonds the company received by
them in excess of fair market value
of the property or the face value; also,
an accounting of the SUM of money
contributed by the Northern Pacific to
the Chicago and Northern Pacific for
the payment of interest on the $50 .000,-
600 mortgage; and to pay over the
"a $50 shares of capital stockiof the
Chicago and Northern Pacific received
by them for par value.