New-York tribune., 1898-11-11

RETAINED BY CERTAIN STOCKHOLDERS OF THE
UNION PACIFIC. DENVER AND GULF COM
PANY-QuEsTIoNs TO COME Up
Z. Ellery Anderson has been retained by certain
stockholders Of the Union Pacific Denver and Gulf
Railway Company. TO bring suit against the Re-
organization Committee Of that road, either col
lectvely or as individual members Interesting
points are likely to he brought up in this suit The
device of Il voting trust in railway reorganization
which was originated by j Pierpont Morgan mas
been a feature Of many such rcorganizations; but
in the suit which Mr.. Anderson IS preparing to IN
stitute the legality Of such voting trust will for the
first time be tested. The Reorganization Commit
tee of the Union Pacific. Denver and Gut consists
Of Grenvle VI. Dodge. chairman; J. Kennedy Tod,
Henry Bulge. Oliver Ames. Harry Walters. Nor
nan b. Ream Henry Lewis and Uriah Hermann
The Union Pacific. Denver and Gulf was orig
inally leased by the Union Pacific. which guaran-
teed the interest on It's bonds. The Union Pacific
also controlled the Colorado Central. which is es-
sential TO the Union Pacific Denver and Gulf AT
the time of the failure OF the Union Pacific j. +.
Morgan G. Co. held about si.N010 Of Colorado Cen
tral bonds r. one of tho Union Pacific collateral
trusts and $4,000 Of Union Pacific. Denver and
Gulf bonds. belonging to the Union Pacific Rail
way Company. II. another collateral trust. In set
Ting up the affairs of the Union Pacific Railway
Company they desirous Of separating from
the main system all the branch and leased lines,
&. Co formed a syndicate. which purchased from j.
T. Morgan & Co. the whole $4,000 OF Colorado
Central and Union Pacific, Denver and Gulf bonds
he'd by that firm. After this purchase th'y or
ganizcd the Union Pacific Denver and Gulf Reor-
ganizatiOn Committee. which Included most on inc
men who had been in the syndicate, ana turned
the bonds in II the Central Trust company, which
was designated as depositary under the reorgan-
izaton plan certificates being issued against these
bonds Mr.. Anderson said Yesterday. IN regard 10
the coming suit: 1T is true that | have been re-
Denver and GIlf TO bring suit agains' the Heor-
Eanization Committee Whether the proceedings
Will be instituted against the committee or against
individual members Of II am not At liberty TO
divulge. Ger. in II Is that stock which at low
figures was worth 81 .500GO I'm TIE market. became
organization. There must be some facts in CON
ncction with this rcoreanizauon whi"h caused this
practical annihilat.On of Inarkc; value. what
these facts are have he'n rctai0od 10 ferret out
The complete scope Of the proceedings has not fully
been determined as yet $50.
Charles Wehrhare. Of fiallgartcn & Co.. had this
10 say about the sIit which is IN preparation: We
understand that those who are back Of this suit
are disgrurtod stockholders. II slch is the case.
| have only to that they VIII have no standing
in any court. Tho stock never was paid for, nut
WAS given as q bonus to purchasers Of bonds
Therefore II is not full-paid and has no legal
status. The people who own II have merely pur
chased II IN the market, and have simply made a
mistake in speculation A. far as the alleged
profits made on bonds by members Of the commit
tee ere concerned. it is undoubtedly true. These
profits were. however. absolutely legitimate. Tho
bonds purchased were paid for at the then market
price. Since then the natural rise In values has
cnhanced their value, and all the pront which has
been made has been derived from the sale Of Cen
tral Trust certificates in the open market"