The herald. [microfilm reel] (Los Angeles [Calif.]) 1893-1900, 1895-09-30
Attempt to Pool All Union
Pacific Interests
MANY BRANCHES INVOLVED
Allegations of Gross Mismanagement and
Heavy Indebtedness
to Earn Operating Expenses.
Federal Control Asked

Associated Press Special Wire.
SAN FRANCISCO, Sent. %. - The
Chronicle says that the most far-reach-
ing law suit ever tried in California, and
one which will attract world wide atten
tion from its economic and commercial
bearing, is On the calendar of the United
States circuit court of appeals for the
present session..
1t is the struggle of the heavy creditors
of the Union Pacific and its thirty-two
branches to have the entire business of
the great trunk line thrown into Com :
mon pool and administered on as trust
fund by the federal courts. The COM
plalnants are in part stockholders and
creditors of the company. The allega-
tons of the volum nous complaint
against the receivers of the com bined
mpanies is full of startling announce
ments and vital statements as to the fail
ure of unrestrained private control. The
inadequacy of the present management
is emphasized and its inevitable trend
towards bankruptcy is portrayed.
The fight is really between the Farm
ers Loan and Trust company and others
against the Union Pacific Railway COM
pany and many of its branches. Such
distinguished men as ex-Judge John h.
Dillon and Attorney Francis r. Coudert
are involved as CO defendants.
The suit involves thirty two branches
of the Union Pacific system as well as
the main line and Its city and depot
property and the plaintiffs appear as a
committee for the minority stockholders
OF the Oregon Railway a nd Navigation
company as well as the Farmers Loan
snd Trust company and the American
Loan and Trust company. The rights of
the plaintiffs originally accrued by rea-
son Of Frederick l.. Ames' ownership of
ABOUT IS, 600 shares of stock in the rail-
roads in question, together with his own
ership of u considerable amount of collat-
eral trust per cent bonds of the Union
Pacific company. The American Loan
and Trust company hold "a, 445, 900 of
these bonds and several millions of SINH
lar bonds are held by other plaintiffs.
Though the capital stock of the Union
Pacific IS alleged to be more than $780,
000 600, the plaintiffs aver that its in
debtedness is 80 great and its mismanage-
ment so apparent that it's affairs ought
to be administered by the federal courts.
1t is alleged that the government debts
of the franchise. The fact is reiterated
with emphasis that the falling off of the
roads revenue is alarming, reaching as
much as 81 400, 900 in two months.
The complaint recites that the Union
Pacific Railway company is not able to
earn operating expenses, either upon Its
main line or branches, that 1.-The COM
pany will not at any time have sufficient
funds or assets with which to pay its in
terest and sinking fund charges maturing
from month to month, and that as re-
suit innunerable creditors will have
right - to begin multitude of actions
against the company, which, it is al
legged, will result in tho diam m horn mt
of the Union Pacific system, so that ''its
properties and assets will be dlssipated
to the manifest and Irreparable
injury to the public, the government of
the United States and the company's
creditors and shareholders.
TACOMA, Wash, Sept. 90 General
Counsel Dunn of the Northern Pacific at
st. Paul. is en- Iout e here, and on his ar
rival is expected TO flo with Judge Han.
ford the designations of Receivers Cakes,
Payne and Rouse. The designations will
also be filed nc st. Paul early this week.
What effect the filing of the designations
will have regarding Judge Hanfords
order citing the receivers TO appear Octo-
Der I'd cannot be told, but SO far as known
here the old receivers are not coming out
to appear in court Wednesday.