Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1903-11-06
WRATHY NIXON.
Alleges to Have Been Abused
and III-treated
By Counsel Guthrie, Who Represents
Schwab in ShipbuiIding Case.
His Protest Is Bitter and Is Ordered
Stricken from Records.

New York, Nov. 5.-The feature of
tOday's session of the hearing in the
United States Shipbuilding case were
the bitter attack made by Lewis Nixon
upon VIM. ID. Guthrie, counsel for the
defendants and representative of the
interests of Charles M. c. SchWab, for
his methods of crOss-examination;
leading questions by Mr.. Untermeyer,
counsel for the compliments, as to the
absence of competition between the
Bethlehem Steel Co, and the Carnegie
plant of the United States Steel Cor
poration in government contracts for
armor plate; and the entire change of
front of Mr.. Guthrie, who heretofore
had aimed to bring out the fact that
the value of the constituent plants of
the United States Shipbuilding Com
pany was not over estimated.
Mr.. Guthrie, todaySAdopted al inc of
questioning designedat6 show that the
estimates of value were made by the
promoter, the vendors and other inter
ested or expert appraisers and were
practically without weight in determin-
ing the exact value of the plants and
the assets of the consolidation.
Mr.. Nixon was on the stand all day.
His cross-examination was finished
and the redirect examination partly
completed.
At the opening of the afternoon ses-
sion he presented personal protest,
in which he declared that Mr.. Guthrie
in consultation with Max Pam had
adopted a line of questioning designed
to place him in a false and discredit-
able position regarding the sale of his
plant to the Shipbuilding Co. The
protest was angry and bitter in tone
and intimated that Guthrie had been
unfair in asking him to answer from
memory questions about the finances
of his company without opportunity to
look up the details, while Guthrie had
had the benefit of full investigation
of the figures. By agreement of coun-
sci the protest was stricken from the
record, but Nixon thereafter during the
hearing insisted that if he was to an
swer questions he should be allowed
to make the necessary explanations.
Beside asking Nixon about the Or
ganization of the Shipbuilding Co.. the
valuation put upon the constituent
companies and the methods by which
they were represented, Mr.. Guthrie
took up the alleged withholding of divi-
dends by the Bethlehem Co., an action
which, according to the charges of Re-
ceiver Smith. contemplated the wreck
ing of the Shipbuilding Co.
Mr. Guthrie placed in contrast Nixon's
attitude in demanding by letter to Pres
ident McIlvainey of the Bethlehem Co.,
that the Bethlehem directors declare
a dividend to save the Shipbuilding Co.
and later, at two subsequent meetings
Of the Bethlehem directors, in acquies-
ing in resolutions, declaring it ineXpe-
dent to declare such a dividend. He
also brought out that Nixon had voted
for the resolution for the expenditures
for betterments. This was the means,
so Receiver Smith charges, by which
earnings We're diverted from dividends
to needless improvements.
Guthrie took Up figures from the fl
nancial reports of the Bethlehem Co.
to show it's inability to pay dividends.
Mr. Fntermeyer from the same reports,
attempted to show that the expendi-
lures for the betterment and new mate
rial We're excessive and that the COM
dend had it been so desired. He was
questioning Nixon about the trip of ex-
animation made by Bethlehem and Car
negie officials to determine means of
improving the Bethlehem plant when
the hearing closed for the day.
The redirect examination of Mr. Nix
on will be resumed, tomorrow afternoon,
and Charles M. Schwab may be placed
on the stand later in the afternoon.
Lewis Nixon took the stand. Samuel
Untermeyer, counsel for the bondhold-
ers, wished from Mr.. Nixon further evil
dence as to the value of the constituent
companies which Were taken into tn
ship yard trust. Following Mr.. Nixon
it is probable that Charles M. Schwab,
or Max Pam, his personal counsel, will
take the stand.
Mr.. Nixon, said he began the Cres-
| cent ship yard in 1896, and that he had
very little capital except his own abil-
ity. Here Mr.. Nixon objected to the
questioning, saying: II don't see why
you should go back five years. If you
can show that this inquiry has any
bearing on the proceedings, I shall be
pleased to answer; butt l see no reason
for going back" Mr.. Nixon said that
his salary was guaranteed him by VIM
Cramp e. Son, and he regarded this as
part of his capital.
ut is not true said Mr.. Guthrie
that at the time of the sale of the
Crescent Company to the Shipbuilding
there was only 1856 in cash on hand and
not $12S, 756, as the books said?'
IF the books said that the cash item
was the largest amount, it was true"
He was unable, however, at that
moment to explain the apparent dis
crepancy.
Mr.. Nixon said he organized the
Crescent Co. with capital of $780,
900. of which s1,197,OOO of the stock
was issued on the property, only $4,000
being paid in cash.
DO you know that the books of the
Crescent Co. on July 81, 1902, showed
balance of $215,213?" asked Mr. Guth-
RE.
THE record will show; I don't re-
member now" replied the witness.
do you not know that in fact the