Evening star., 1898-07-22
Postmaster General Smith Sets Aside
the Contract Award.
PROPOSALS TO Be READVERTISED
An Injunction Sued Out by the
Defeated Company.
HISTORY OF THE CASE

| ernment with stamped envelopes to the
Purcell Envelope Company, and has d.
| rected that the proposals be readvertised.
| Few matters before the Post Office De-
partment have attracted such attention al
| the award of this contract. Bids were
| opened last March under advertisement
and before all the bids had been recorded
it was that a big fight was on hand.
| This manifest because the current
contractors, operating under another's con-
tract, were beaten again in its bid.
| History OF the Case.
brief history of the case is necessary
| to a clear understanding Of the matter.
For many years the Piympton Envelope
Company Of Hartford, Conn, had the con-
| tract for furnishing the stamped envelopes
| to the government. reference to the
! prices obtained in the past evidences the
large sums of money made by this con-
| Germ.
-Four years ago the Plympton company
! received shock. The Purcell company
| of Holyoke, Mass, without any notice
dropped in a bid Just before the closing
| time c2me and beat the Connecticut com
| pany nearly half million dollars 1t was
beheved by the post office officials at that
| time that the Plympton company was in
| a combine and controlled the market as
| far as the particular kind of paper used by
the goyernTe ent was concerned. But the
| to furnish the necessary paper. and was
| accordingly granted the contract. But 1t
never did the work, although in "A recent
| nearing before the Postmaster General its
| representatives declared it was ready at
| all times to do it. But the Plympton ccm-
| pany made such a generous offer to IS
| successful competitor that the latter SUBJ
let the contract and drew large sums
| monthly for doing nothing 1t seems now
the Purcell com oany had an eye to the
| Iuture, for, with the bonus paid by the
| Plympton company, it built an extensive
pant and demonstrated in no uncertain
way its desire TO do government work
| When the new administration came in it
appointed as third assistant postmaster
| general Mr.. John A. Merritt a practical
| paper man of northern New York. When
| the subject of preparing new bids came up
General Gary, at that time Postmaster
| General, sent for Mr.. Merritt and intrusted
| the matter to him. One of the first things
| which attracted the attention of this Off
| cial was a clause in the Old specifications
| which contained the following:
| Must be run through a tub of
| animal sizing and be loft dried"
| Recognizing an opportunity in this inno-
cent sentence for a combination to ne form
| ed whereby all the loft-drIed paper could
| be controlled, Mr.. Merritt with the sane
| ton of the Postmaster General subs tituted
| the following:
| And must be loft dried or by
some process of air drying which, In the
| judgment of the Postmaster General will
| produce equally good results.
| This substitute, it was explained at the
! time, would give other paper manufactur-
| crs a chance to bid and bring about a COM
! petition which was calculated to reduce the
| cost.
Another addition to the new specifications
| was mace, whereby man might submit
other samples of paper with the formula
1or making the same, and these would be
considered in awarding The contract. And
So when the bids Were opened many Of the
bidders submitted samples of their own.
The Lowest Bidders.
| the lowest bidder for the government
sample of paper was the Purcell Envelope
| Company. while the Plymp.on company,
under the joint bid of the Plympton- Nor
| gan company, was found to be the lowest
| biduer on the bidders sample. The Purcell
company, it was found, was $4,000 a year
| lower on the government sample bid than
| its nearest competitor, While the PIymplon-
Morgan bid was something like So 900 a
year lower than its nearest competitor on
bidders sample
Following the opening of the bids came
! investigations and expert inquiries. 1t was
at once seen that the Old lrnS were the
| only ones contending, and the other bidders
withdrew and let them fight it out. After
several weeks of consideration General
Gary announced that all bidders sam
pies" would be thrown out. This left for
consideration only the bids submitted on
the government samples. Special inspect
ors were sent to Holyoke to examine and
report upon the ability pf the Purcell COM
pany to carry out the contract in the event
OF an award being mad 10 it. Prominent
politicians representing both bidders pre-
sented arguments IN favor of their particu-
lar bidders, and it was said that the matter
had been dragged into the cabinet discus
Slons.
After hearing both sides and assuring
himself of the ability of the Purcell COM
pany TO perform the contract, Postmaster
General Gary awarded the contract to that
ay.r II
company being informed in writing ot the
decision. The EeXt day Gen. Gary re-
signed from the cabinet, leaving the con-
tract unexecute ed The hopes of the de-
fe& ted company frightened, and the same
influences that had been brought 70 bear
On Gen. Gary were transferred to Gen
Smith But the latter determined not to
be influenced by anything but his own
judgment in the matter, and helG Up the
case until he could Investigate for himself.
Different inspectors were sent and rev re-
ports submitted
Weeks into months and nothing was
done. This morning Gen. Smith announced
his decision, and within an hour deputy
marshal served an injunction on him.
Postmaster General Smiths Action.
To reporter of The Star Postmaster
General Smith said:
1T is true that 1 have set aside the
award of ex-Postmaster General Gary in
the matter of the envelope contract and
have decided to readvertise for new bids"
When asked what reasons had prompted
him in this decision he politely declined to
explain, adding: No, L will not make
known my reasons at this time"
While the reporter talking a deputy
marshal was announced, and served the in
junction which is returnable August 9
Postmaster General Smith immediately
sent for Assistant Attorney General Tyner
aid discussed the injunction.
The vice president of the Purcell com
pany. Mr.. Fl. E. Townsend, was present
at the Post Office Department this after
noon. To reporter of The Star he said:
THE contract was awarded to my COM
pany- in good faith by ex-Postmaster Gen
eral Gary. and we maintain the action Of
Postmaster General Smith is without war
rant of law. Our case is in the hands of
our attorney, Jeremiah NJ. Wilson"
The Court Proceedings.
The Purcell Envelope Company of New |
York has entered suit in the District Su- !
preme Court against Postmaster General |
Charles Emory Smith, seeking to have |
him enjoined in his official capacity from |
setting aside annulling a contract with |
the plaintiffs to furnish the Post Office |
Department with envelopes and newspa- |
per wrappers. |