The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1900-02-14
FRlCK FILES A
BILL IN EQUITY
concluded from Page IL

tOlOTe executed. All tnIS u lS dueBeu
Carnegie did secretly and purposely
concealed the knowledge thereof from
Frick.
Carnegie was enabled to control his
partners because most Of them still
owed the firm money for their inter-
ests. and Carnegie, dominating the
firm by majority interest. they were
unwilling or unable to Withstand his
demands. Carnegie induced some Of
agreement Of 1892, and. then, without
warning, sprung upon Frick a notice.
on Jan. Is. 1900 which he has also
caused his co-partners secretly to sign
and which was based upon the pre-
tended existence OF the so-called IRON
clad agreement.
Carnegie followed this notice by COM
pelling on Feb. 1. 1900. Schwab. the
president of the company, to transfer
on the books of the company all Frick' s
interests in the Carnegie Steel COM
pany. limited. to the said company.
and he now pretends that he (Carne-
gie) can practicalls dictate to Frick the
value at which he will take these in
terests. He claims that Frick is not
entitled to anything for the good Will
OF the company, or not entitled to have
his interests valued as of a going con-
| cern, but that he (Carnegie) can use
old and obsolete figures which hav :
stood on the books for years, in many
respects unchanged so as to reduce the
value of Frick's interests to the neigh
borhood. he hopes, of about $4,000, 900.
Carnegie's Holdings.
the Carnegie Steel company, limited,
he will, therefore, own more than one
half of the per cent. which Frick
sells. and II he can thus acquire 8
per cent. Of Frick's holding for what
| would amount to about $3.000,000, he
will make a net profit of that trans
action alone. based on his own selling
| price. as above stated. in the neighbor-
hood of $5000,O0O.
Frick says that never since 1887 has
either firm attempted to force part
ner to sell. That no interest whatever
was ever acquired under the so-called
| agreementof 1887 and none under the
one Of 1892. except that at times when
the financial condition and earning
power Of the company were radically
different the company did purchase the
interests of three deceased partners
but by an amicable and satisfactory
arrangement with the representative
of each. Never in the whole history
of both firms was 1t ever supposed
that any partner had placed himself ir
such position that Carnegie could
through personal malice force him
from the firm and that for Carnegie tc
attempt this in 1900 through the guise
Of proposed agreements which looked
to the honor and well-being Of the flrn
to crafty his personal malice, was VIC
ious and fraudulent misconstructior
and misuse Of the same.
Frick's Offers.
The bill alleges that the new part
nership of the Carnegie Steel company
limited. is not limited. but genera
partnership but Frick is unwilling tt
take advantage of what he believed t
be a limited partnership until he wal
advised otherwise, after this contro
versy arose. and he, therefore, offers:
(a) To sell his interests in the firm
at what three business men Will Judg'
them to be fairly worth; (b) to execute
new papers making a valid, binding
limited partnership, and to continue
the firm. in all respects, as 1t was in
tended heretofore to do: (c) to con
time ne firm, even If 1t Is a genera
partnership and all are individually liza
BILE, provided he be allowed to partici
pate in the management. because t
leave the sole management to Carnegi
would result eventually as he( Frick
believes in financial loss: (D If Car
negie refuses all these offers. then h
asks the court to dissolve the partner
ship and to have a receiver appointed
to sell the property and pay the debt
and distribute the balance.
Mr. McCook also called attention t
the fact that three of the oldest part
ners, Henry Phipps, jr., Henry NJ
Curry and f. T. F. Lovejoy, and sew
eral smaller holders OF interest, are II
sympathy with Mr.. Frick and oppose
to Mr.. Carnegie's present attempt.
The bill was not filed until 8 o'clocl
this afternoon, and the Carnegie Stee
company was not notified of the sui
owing to the lateness of the hour. !
copy OF the bill will be sent to the de
PENDANTS tomorrow.
An Interesting Clause.
One of the interesting clauses in tn
bill demonstrates that the compan
, was not a limited partnership and the
tells how the capital Of the compan
was provided. 1t says:
The agreement Of 1892 provided tina
capital to the extent of $2000o,0C
should be paid in cash on or befor
, the 30th day Of June. 1892, but mad
no provision for the remaining capita
viz, S5.O0N,000 Said amount Of in
creased capital was never paid int
the association in cash, either on @
before the Goth day Of June, 1892. Q
; later. Said increase was made in tn
manner following:
/, On the 30th day of June, 1892, the fir
!. of Carnegie. Phipps & Co. declared
dividend Of 200 per cent on it's capita
stock of $5.O0o000. The amount of thi
dividend thus declared was slO,U0O,0O
On said action on the seth day Of jun
1892, the firm of Carnegie Bros. & Co
r limited, also declared dividend upo
/ its then capital of s5,oo0.000 Of 200 p.
l cent, making the amount of the div
dend thus declared sl0,0O000o. Check
were given by Carnegie, Phipps
Co., limited. to it's members, and b
! Carnegie Bros. & Co.. limited, to il
; members, for their several shares {
said dividends, said members bein
the subscribers to the articles Of asst
citation of the Carnegie Steel compan.
limited, these checks thus given to sal
, | members We're endorsed over by thel
in payment of their several subscril
/, tions to Carnegie Bros. & Co., limite,
\ in payment of the several subscriI
} tions to the Carnegie Steel compan
limited. In fact, no cash was paid b
either of said limited companies. neitl
er by Carnegie Bros &. Co., limite
nor by Carnegie, Phipps & Co.. lin
tied. There was no cash in bank
. the credit of either company to me,
5 said checks thus by each drawn. Sui
t sequently Carnegie, Phipps & Co.. lin
5 tied, having retained assets suficiel
4 to pay it's obligations other than tho:
| assumed by the Carnegie Steel con