The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1903-08-04
HAS THE STATUTE
BEEN VIOLATED 2
The Government Contract for
Gloves With Lyon.
RESULTS OF THE INQUIRY
Littauer, Senior Member Of Firm Furnishing The
Gloves, Member Of Congress- The Case
Goes 10 the Department of
Justice.
(Rv the Associated Press.)

(By the Associated Press.)
Washington, Aug. 3.-Secretary Root
today made public all the papers relating
to the investigation into the government
contract for gloves with E. r. Lyon
This contractor secured the gloves from
Littauer Brothers, the senior member of
the firm, +. n. Littauer, being a member
of Congress- Secretary Root has referred
order that it may be ascertaned if the law
ha sheen violated, and if so, that apprO-
pirate measures may be taken in the prem
| lses. There is statute which prohibits
| contracts for government supplies beng
made directly or indirectly with mem
| Der of Congress, and this was the basis
of the investigation by the War Depart
ment Colonel Darlington of the Inspect
or Generals Department, was directed by
! Secretary Root to make an investigation
of the whole matter, which he did, taking
testimony and submitting a report as to
the facts in the case. This report and the
! testimony was referred to Judge Advocate
General Davis, VINO made an extensive re-
view and submitted an opinion To Secre-
tary Root. In the course of hls report
and opinion General Davis says:
1T appears from the testimony that on
| October Is. 1898, contract was awarded
to Lyon for three thousand pairs of musk
rat gloves at $1.54 per pair; on December
! 1888, a second contract for 10000 pairs
was awarded to Lyon at $1.70 per pair;
stipulation being inserted to the effect
| that deliveries under it could be increased
J fifty per cent, at the discretion of officers
making the contracts, The government
took advantage of the stipulation on 30,061
pairs were actually called for and deliver
ed under the contract of December Z, 1898.
Some discussion having arisen as to the
price which Lyon was to pay for gaunt-
lets delivered under the contract of De-
cember Z, an agreement was entered into
| by Littauer Brothers and Lyon to the eff
feet that an accurate account of the cost
of manufacture was to be kept, and if, af-
ter the contract was completed, should
prove that the cost of manufacture did
not equal $1.65 per palr, Lyon was to re-
ceive one half of the profits. There was
profit of $353705, one half of which was
credited to Lyon on the books of LICtauer
Brothers. A case falling within the pro-
hibition of the statute is clearly shown in
the testimony, which, in the opinion of
this office charges the department with
the performance of the duty set forth ir
Section 1888 of revised statutes, and it is
| therefore recommended that a demand be
made by the Quartermaster General upon
the firm of Littauer Brothers for the re-
payment of contract of December Z, 1898,
with e. r. Lyon as extended, in accord
ance with its terms by the Quartermaster
! Department"
! General Davis says the fact that a
member of Congress was active manager
of firm selling to government contractors
should have put the officer charged with
| the making Of such contracts on his
guard against attempted violation of the
statute.
1T was,'' he says. "the first duty of an
officer charged with making purchases in
behalf fthe United States to see that
the articles procured were of standard
quality and that the prices paid were
reasonable. The testimony elected during
the course of the investigation showing
the price paid, the profits realized, and
the numerous reflections of goods which
! fell short of the standards established by
the department, shows that this duty was
thoroughly and conscientiously perform
ed"
Secretary Root makes the following en-.
dorsement nthe opinion of the Judge ad-
vocate general, which sends the case to
the Department of Justice.
/ 81 suppose there is no doubt that a
manufacturing firm, one member of which
happens to be a member of Congress, has
right to manufacture and sell goods to
jobbers who are filling government con-
tracts, and that they do not come within
the prohibition of the statute so long as
the contract between the firm and the
IJobber Is a separate and distinct transac-
ton from the transaction between the |
Jobber and the government. There ap-
pears to be no evidence that in the manu-
tacture of gloves by the Messrs. Littauer
Brothers to be used in filing the govern
ment contracts made by Lyon and others. |
there was any violation of the statute.
except In one case. the contract of De-
cember 7th, 1898. 1t is not the duty or
the right Of the Secretary of War to ad- |
judlcate that case, or to determine wheth- |
er the statute was or was not violated. |
except in so far as it may be necessary
for him to decide what action. if any, |
should be taken by the War Department |
in view of the facts disclosed I think
the indications of an interest by the man
ufacturing firm in the jobbers' contract |
with the government are sufficient to re-
quire me to proceed upon the theory that |
there is prima facie case of violation of /
the statute Three duties are thereupon
devolved upon the Wart Department:
First. To put the Department of JUS
tice in possession of the facts, in order
that if that department finds the law to