New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-04-27
DRESSER CHARGES FRAUD
Continued from first page,

ments and evidence: As to the money damages
care little, except that may be able to pay my
building up the business; which created myself
resj DAMAGES because the Trust COMPANY Of the
Republic which I created. has practically gone out
of business and my place as head of it has been
sacrificed. but can build up my drygoOds business
it with
The complaint OF Mr.. Dresser alleges three
separate causes Of action, the first arising out Of
the methods employed in the formation of the
United States Shipbuilding Company. the sec
ond for damages for losses he sustained through
the sacrifice of stock owned by him in the
American Tubing and Webbing Company, as
result of the action of the defendants. and the
third for damages for the loss Of the silk bust
ness
Messrs. McCook and Young told the plaintiff
that the Mercantile Trust Company had OBJ
taIned undertakings from trustworthy people
in Paris and London for 100000 and OF that
amount 49, 900 900 had already been underwritten
in France. according to the complaint and they
showed him a form of underwriting which
they stated the French people had signed. which
ran TO the Mercantile Trust Company. Relying
on these statements and the prospectus. the
plaintiff, acting for the Trust Company OF the
Republic, which in turn was acting solely ror
the defendants secured undertakings for
So 600 900, and later the solicitation OF NC
Cook, obtained further undertakings for $l'10O'-
OOO The sole connection Of the Trust Company
of the Republic with the enterprise was to OBJ
tain the undertakings and act as house of
issue to the public of these securities, to be bank
of deposit to the Shipbuldng Company after
it's organization and the transfer agent of the
stock. the Mercantile Trust Company being the
guarantor Of all underwriters, says the COM
plant.
The result of all these representations made
to him by the defendants was the purchase by
the plaintiff of 1450 shares Of the Trust COM
pany Of the Republic. at the value OF S05OiOOO.
OF the S6OOOOOO agreed to be paid to the ven
doris. at least S2346OOO was retained by the
defendants as their secret and fraudulent profit
| the complaint charges.
The United States Shipbuilding Company
| when organized June II, 1902. had as the
! total amount of capital stock subscribed for
| 81 900 and this was borrowed from the Trust
! Company of the Republic, to which it was after
| ward repaid goes on the complaint. me m
| generators paid in none OF the capital SUD
scribed by them and the company never nao
! any capital except sums borrowed Tor that pur-
| nose TO deceive the public into believing that
! fhe bonds and stocks had been legally Issued,
| Mr.. Dresser charges.
| that the requirements of the law Of New-Jersey
| in relation to the formation and organization OF
| oornOrations were not complied with, and that
] the pretended incorporation was invalid, which
! was known to the defendants but not to the
The value Of the plants acquired. said to be
! S7O997 600 was known by the defendants TO be
| false continues the complaint. which alleges the
| shipbuidng company never was capltalEeo OF
pretended to be capitalized, as set forth in the
| prospectus When 1t did pretend to increase the
amount of its original $1,000 capital stoeks II
increa sed its amount by total issue OF $40, 0OO.
| 600 made up of $2OO0OOOO preferred and $25,-
! OOOOOO common stock. instead Of $2OOOOO0O
| made m Of S1OOO0OO0 preferred and $4,000
! OOO common stock, without the knowledge OF
those who signed the underwriting 1t Is de-
| clared That the underwriting in France wholly
failed the only amount subscribed being S20OOO
| and all the underwriting. with the exception OF
that obtained by the plaintiff fraudulent is
| a further contention of the plaintiff.
| Among these fraudulent undertakings. de-
| clares the complaint, was 100000 purporttng
TO be written by the Mercantile Trust Company.