Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-10-12
USING TRUST METHODS
One Cause of RevuIsi0n of Sen
10 timent .
AGAINST Mr.. VIM. R. HEARST
Arrangement Described by His OPP
ponent, Mr.. Hughes.
A HOLDING CORPORATION
For His Three Papers in New York
City, With Offices in New
Jersey.

Two reasons are assigned for the alleged
revulsion of sentiment against Mr.. Hearst
in New York city and vicinity and which is
said to be extending up state among the
more conservative classes. The first is de-
clared to be disgust of the voters who fol-
lowed him last fall in his mayoralty cam
paign against Boss Murphy at the specta
Gle of his alliance with Murphy this year
and a "whack up on all kinds of offices,
even the judiciary. The second is said to be
chagrin of his followers, believing him sim
cere in his attacks on trust methods, at find
ing him discovered using trust methods to
avoid taxation and damage suits in the
conduct of his papers
The deal with Murphy is now an old
story, but as the campaign progresses new
chapters are developed, all substantiating
the original dicker. The division of the
spoils proceeds apace, and is being done so
openly that even the most frenzied support
ers Of Mr.. Hearst cannot close their eyes
to it, The other story is more recent and
people are just beginning to open their
eyes to it's full significance.
1t was Candidate Hughes who flushed the
trust sensation. and he is ringing the
changes on it daily He disclosed the fact
that Mr. Hearst had organized u ''holding''
company, known as the Star Company, I'M
der the trust laws of New Jersey. which
held all the stock of the papers in New
York and in turn Mr.. Hearst held the
stock of the holding company. The Hearst
papers under this arrangement could not be
sued or taxed.
Arrangement Described.
This arrangement is described at length
by the New York World. The article says:
1.-The holding company owned by Mr..
Hearst is the Star Company of New Jer-
sey, which, in turn holds the stock of the
New York American Publishing Company
the New York Evening Journal Publishing
Company and Das Morgen Journal Asso-
citation. The first of these three publishes
Mr.. Hearsts morning paper, the American;
the second, his evening paper and the
third publishes the German edition of his
morning paper
1.-The official home of the Star Company
is also the official home of from 500 to
1900 corporations. many of them the big
gest and most powerful trusts in the United
States. The Star Company is housed in the
offices of the Corporation trust Company
of New Jersey, at No. 10 Exchange place,
Jersey City.
The Corporation Trust Company of New
Jersey, which shelters Mr.. Hearsts holding
company, was made famous during the ex-
posture of the United States shipbuilding
scandal 1t furnishes dummy directors to
corporations, dummy home Offices in Jer-
sey City to corporations, and dummy cor
porators for corporations, and has been
patronized by all sorts of flnanciers. Mil
Ter, the get-rich-quick swindler, had his
52O-per-cent syndicate incorporated by the
Corporation Trust Company. Innumerable
corporations which collapsed after their
stock had been unloaded upon the public
by their hackers were also Incorporated
by the Corporation Trust Company.
Like the other 1,50O or 1000 trusts shell
tered by the Corporation Trust Company of
New Jersey, Mr.. Hearst's holding corpora
ton, the Star Company, merely has dummy
Offices there to comply with the Jersey
law The walls of the corridor leading to
the offices of the Corporation Trust Com
pany are covered with immense tablets
containing the names of the 1,50O or 1900
corporations. The mere presence of a cor
porations name on this tablet gives it
technical residence or home office in Jersey.
Home Offices in New Jersey.
Every corporal ton chartered by Jersey
Is supposed to maintain its home office in
that state, and this legal requirement is
satisfied by Mr.. Hearts holding company
and the other trusts by having their Off
cial titles printed the tablets of the
Corporation Trust Company
Charles f. Hughes in his speech last
Saturday night in Brooklyn, first called
attention to Mr.. Hearsts holding corpora
ton, the Star Company. Mr.. Hughes was
talking about good and bad corporations.
those which are conducted honestly and
lawfully, and those conducted vicously and
illegally. During his speech he read from
the court records of a suit brought by Mrs.
Nell Werner against Mr. Hearst person
ally. as the owner of the Evening Journal.
Mrs. Werner was run over and injured
by one of the delivery wagons of the Even
ing Journal May IA, 1897, and sued to
recover damages. The case first tried
before Judge keogh. in the Westchester
cou\y supreme court. Mr.. Hearst, the de-
PENDANT, put in this defense in the suit:
The defendant denies that on the 14th
day of May, 1897, he was the owner or
publisher of newspaper, or that in or
about the business of distributing trans
porting such newspaper he employed a
certain vehicle, cart or wagon, or certain
horses, drivers or other persons
LAS Mr.. Hughes explained it, Mr.. Hearst
was endeavoring TO escape personal lia-
bility by declaring that the horse and
the driver was employed by a corporation,
and nevertheless the jury gave Mrs. Wer-
ner a verdict for So, 600 damages against
Mr.. Hearst He appealed on the same
grounds namely. that he was not person.
ally liable, but the appellate division up
held the verdict. He again appealed, and
finally Won in the court of appeals.
Paid No Taxes in New York
I'm explaining Mr.. Hearts purpose in
having the Star Company chartered under
the laws of New Jersey, Mr.. Hughes
showed that none of the three subsidiary
concerns of the holding company had paid
taxes in New York state for several years.
"Mr. Hughes pointed specifically to the
fact that Clarence ]. Shearn, Mr.. Hearsts
attorney, figured conspicuously in connec-
ton with the Star Company and its SUBJ
salaries. Up to the time Mr. Hughes made
this speech Mr.. Shearn was Mr. Hearst's
candidate for a place on the supreme cou~D
bench. After Mr.. Hughes speech Mr.
Shearn was eliminated as candidate for
judicial honors.
I'm view of Mr.. Hearst's sworn statement
in the Werner suit that he was not the
owner or publisher of newspaper a let,
ter written TO the World by his attorney
Clarence ]. Shearn and attorney for the
Star Company and its subsidiaries on
February q, 1901, is peculiarly interesting
Shortly prior 10 that date the Star Com
pany issued $r00o,0oo of bonds, and it was
printed that Mr.. Hearst had mortgaged
his three papers for that amount. To cor
rect the idea that Mr.. Hearst had borrowed
money on his newspapers, Mr. Shearn