The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1894-10-31
CAUGHT BY ROCKEFELLER.
He Now Sues to Get His SeCu-
rites Back.
MINING IN THE GREAT MEsABA.
1t Was Largely on Paper in the
Interest of the Standard Oil
King.

DULUTH, Mimi, Oct. 30.-Alfred Mer-
rift to-day brought suit against j. ID.
Rockefeller and F. d. Gates, his private
secretary. for 81, 226. 400, in which amount
be claims he was damaged by what he
alleges to be fraudulent representations in
the forming of the Lake Superior Consoli-
dated iron mines. Plaintiff claims that at
various times in August, 1893, in New
York City, before he had transferred his
interests in various iron mines and the
Mesaba Railroad, the defendants repre-
sented to him that the Pen0kee and
Gogebic Consolidated mines. which. with
others controlled by Rockefeller, were to
be taken into the Lake Superior CONSOLE
dated iron mines. was a solvent and pros
porous company; also that the stocks OF
the Spanish-American and the Aurora
were well worth what Rockefeller was to
receive; MIR. Rockefeller and Wetmore
promised to lend to Merritt on his Consoll-
datedl stock money at 40 cents OH the dollar
at par value. All these representations and
promises, plaintiff claims, were fraudu-
lent Defendants at the time knew that
each of the companies controlled by
Rockefeller owed large amounts outside
OF their funded debt, and that the Peno-
kee Company was at the time lnsolvent;
that in stead of making the value OF the
Lake Superior Consolidated Company's
stock worth 90 cents on the dollar, as
Rockefeller promised it would, the stock
of these other mines caused its value to
decrease to SO per share of 500.
When Merritt asked Rockefeller to keep
his promise and to loan him money on his
ha 70 If 70 ho dol
lar and later at twenty-five cents, Rookie
feller refused and would only give ten
cents on the dollar. In organizing the
Lake Superior Consolidated Mines, the de-
PENDANT, it is claimed, got the new COM
pany to take the following interests owned
by him: q, $50 shares of . Aurora Iron
Mining Company's stock; $50 shares of
Penokee and Gogebic Consolidated Mines
81 ,626 shares of the SpRnish-American
Mines in Cuba; 300 collateral trust notes
of $1,000 each, of the Spanish-American
Company, for which the Lake Superior
Company turned over first mortgage bonds
exceeding 81, 900, 900 and for flfty-one per
cent interest in the Adams and Lone Jack
Mines, Rockefeller got Consolidated first
mortgage bonds worth over 81, 100000.
Rockefeller represented the interests
which he transferred to be worth 81. 100. 354
as follows: Aurora stock, S203, 9SS; Peno-
kee and Gogeoic, $579. 9O6; trust notes OF
same, S25l, 1923; Standardization stocks,
$500. 35S; mortgage bonds of same. SIC, ATT;
70o1 shares of Minnesota Iron Company's
stock, 1896, 499. The agreement showed
that Rockefeller also controls the follow
ing stocks and securities of companies,
which he promised to try to get into the
consolidation: 72S shares West Superior
Iron and Steel Company of the par value
of $72, 800, and $40 first mortgage bonds oil
the same at S640O0O, bringing his total H.
terests which he intended to transfer up to
81, 36l, 919.
Rockefeller claimed that they cost him
81, 49, I54, and he was to get consolidated
bonds worth SO, O19, 800 for them at 90 cents
The separate agreements were entered
into before the consolidation was finally
effected There will. it is said. be seyera
| more suits before the matter is ended. The
capital of the consolidation was at frs
fixed at $3.O00,0o0. but later increased tt
90 non