The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1898-09-14
Raleigh and CASTOR Can Buy
Its Stock.
DECISION OF SIMONTON
THE N-RYAN FIGHT Is
NOW SETTLED.
AND HOFFMAN WILL RETAIN CONTROL
One of the DemuHers 0verruIed and the Other
Sustained. Charter Gives Right to Pur'
chase Blocks of Stock. Full Text
of the Courts Decision.

of the Courts Decision.
The decision of Judge Simonton in the
filed here yesterday with Clerk n. ].
Riddick, of the United States Circuit
Court.
1t practically settles the Ryan-Hoffman
controversy in regard to the purchase OF
blocks of stock by the company and vot-
ing the same by the directors. 1t is Ill
favor of the Hoffman faction and against
Ryan:
The full text of the decision, setting
forth the facts on which it is based,
is as follows
United States of America,
Eastern District of North Carolina.
In the Circuit Court.
George B. NJ. Harvey
The Raleigh and CASTOR Railroad Com
pany ct al.
This bill is filed by George B. NJ. Har-
yey. claiming to be stakeholder in the
Seaboard and Roanoke Railroad in be-
IL
in said company who may Intervene and
claim the benefit of this suit. The de-
PENDANTS are the Seaboard and Roanoke
Railroad Company and the Raleigh and
CASTOR Railroad Company, citizens OF
North Carolina and resident in the dis
trict, r. G. Hoffman and Louis McLane.
citizens and residents of the State of
Maryland, the former beng the president
of these two companies, and the latter
a director therein, and Leigh r. Watts.
citizen and resident of the Eastern dis
trict of Virginia, who is also director
in these companies.
A plea to the jurisdiction was filed in
behalf of Messrs. Hoffman, McLane and
Watts; and sustained except in so far
as they were officially bound by a de-
cree against these companies of which
they were officers. The bill sets out
that the Seaboard Airline system, com
posed of many corporations, among them
the Seaboard and Roanoke Railroad
Company, is practically under the domi-
nation and control of the Seaboard and
Roanoke Railroad Company. And that
the-Raleigh and CASTOR Railroad Com
pany is in every respect under its con-
troll That the Seaboard and Roanoke
Railroad company has issued in stock
preference. and 81. IA 200 common stock
That the voting power of such stock is
by the person in whose name the shares
of stock stand on the books of the COM
pany-he being for this reason deemed
the owner thereof as regards the COM
pany And that there is a graduated
system of voting. to-wit: One vote for
each share of stock not exceeding 20;
one vote for every two shares of stock
exceeding 90 not exceeding 200: one
vote for every five shares Of stock exceed
ing 200 and not exceeding 500, and that
provision is made protecting the company
from any so-called stakeholder who offers
to vote upon any stock represented by
which he does not own bona fide or
which has been transferred to him with
intent to give more votes than is al
lowed by the provision set out above.
That Messrs. Hoffman. McLane and
Watts had been elected directors at the
annual meeting in 1896. That for the
purpose of maintaining their position and
influence in the Seaboard and Roanoke
Railroad company, these gentlemen pur-
chased upwards of 1000 shares in the
stock of that company, held by and
standing in the names of many individ-
uals, of whom seventeen are mentioned,
the other names being at present I'M
known to complainant. That this pur-
chase was made secretly, fraudulently
and Illegally upon the credit securities
and moneys of the Seaboard and Roa-
noke Railroad company, or of the Raj
eigh and CASTOR Railroad company by
these gentlemen or one of them, out
of the corporate funds in their charge.
That neither of these companies have
any charter, power or capacity to invest
its means in the purchase of any stock
in the Seaboard and Roanoke Railroad
company or to hold any such shares or to
vote the same. That since said sale and
purchase, which was made about March.
1897 none of the stockholders so selling
have had any interest. legal or equitable
in said stock. and that the beneficial
interest therein is in the corporation
which purchased the shares. That. how
ever, in order to conceal the purchase
and at the same time enjoy the power
in the votes of the shares. To trans
fer has been made on the books Of
the company, by which it would appear
that these shares still stand in the
name of the original holders and that
Messrs. Hoffman, McLane and Watts
propose to vote them in the names OF
such nominal holders in meetings of the
'"ihpdiy, anu thaL thcSe w. - -
recognized and received by the inspec-
TORS and judges of the election. That
the amount in controversy is more than
$1,000, exclusive of interest and costs.
That complainant has. for more than
two months. been a stakeholder Of record
on the books Of the Seaboard and Roa-
noke Railroad company, bona fide. abso-
lutely and with no intent TO evade the
graduated system Of voting That an
injunction has been obtained against his
voting on his stock. in local court
Of Virginia, which. however had nc
jurisdiction over him, and with whose
Injunction he has not been served.
The prayer of the bill is:
/. That the defendants be required to
answer. not under oath.
q That on final hearing it he decreeG
L.