The sun. [volume] (New York [N.Y.]) 1833-1916, 1908-04-21
LIGHT ON SUBMARINE SCANDAL
CONFLICTING TESTIMONY or
LAKE AND RICE WADE CLEAR.
While Each Thought the other Vas Trying
70 Buy Him Out Promoter Brown
Was Conducting the Negotiations for
the Merger without Authority OF Either.

WuHio EANl AUVuaut tHb ONUtF wa lfguha
70 Buy Him Out Promoter Brown
Was Conducting the Negotiations for
the Merger without Authority OF Either,
WASHINGTON, April 2o.-The House com.
mittee investigating submarine companies
dug up NJ scandal to-day, but the mists
in the testimony Of the two chief witnesses
we're cleared away One Of those pro-
motors who are read about in books recon-
ciled the conflicting testimony Of simo n
Lake and Isaac l.. Rice, each one having
sworn TO the belief that the other had been
trying TO buy him out, Mr.. Lake Is presi-
dent Of the Lake Torpedo Boat Company
and Mr.. Rice 10 president Of the Electric
Boat Company, chief owners Of rival sub
marines. Each has been convinced that
the other was a terrible man, 70 swear as he
did.
The committee has spent days and ex-
hausted all the arts Of talented cross-eX-
aminers to establish what was what and
who il was that was trying to deceive the
committee and triie with its intelligence,
1t all came out to-day. Everybody told
the truth about the big deal that was on
between the companies, and the hated
rivals have one point Of difference removed
that has made them unable to think Of
each other without a scowl
The committee was inclined 10 lose
patience with Charles r. Flint, selling agent
in foreign countries for the lake Boat
Company and man Of affairs in New York,
because he could not throw much light on
the status Of Affairs, though he had spoken
to Mr. lake, and acted as a 60 between
In the merger prospects. II was all right,
though Everything was cleared up as
simply as chasing a Ny from the wall when
Grant Hugh Brown, promoter, IFS Broad
way. New York, gave his testimony. He
was the man who did It all, ave both sides
their impressions OF their relations toward
the business between them, got the idea
himself. submitted the terms himself and
had both sides thinking hard at one stage
OF Developments Mr.. Brown thought it
was a good thing and 1t was his business
TO make the other fellows see il.
When Mr.. Brown caught the idea on the
train on his way to his office he went straight
to the office Of Mr.. Rice. What happened
after that is disclosed by bits Of his testi-
mony. Mr., Rice asked him II he was au-
thonzed TO speak for the Lake people.
Il was up against it,, said the witness,
and answered: II you telephone them
they will probably tell you no, but ! think
thev will trade"
Mr.. Rice seemed TO be interested ana
made a condition that any deal must be
with the understanding that the investi-
CATION started al Washington should stop.
What did you say 10 that?' inquired
Mr.. Otmsted.
Il said, Sure; make il the sine qua non,''
the witness replied with a flourish.
Then he explained with charming frank
ness that Mr.. Rice evidently believed that
the Lake people had started the investiga-
ton, and he made a lightning calculation
IL thoy started il they could stop il
the companies got together, 80 he was
to make It a condition for his end
Of the deal.
With this start Mr.. Brown explained
that he was in MIR. Flint's Office in five
minutes and had Mr.. Flint busy on the
telephone opening negotiations with Mr..
Lake. All the figures given both by Mr..
INllC dLu WI INC NJ 70 lilt dNlOuIl bI
or demands between them were
as correct by Mr.. Brown,
but since all the figures had been prepared
by him, each party, he thought, was iusti-
fed In believing that the other was anxious
10 make a trade.
Mr.. Brown contradicted Mr.. Rice m
Dhatically on n point, that being that
he had told Mr.. Rice that he could stop
The investigation through Senator Buckley.
lie added that heidi not know MIR. Buckley |
was a Senator, The last time he heard Of
him he was Governor. Nevertheless,
after the name Of Senator Bulkeley was
mentioned TO him, and some one dropping
N Just then, he repeated the name quite
not 10 he thought entirely out
of the running wherever It led.
In describing in n quick, businesslike
lir his ever ready alternatives in the con-
iuct OF his negotiations Promoter Brown
lad the committee convulsed with laughter,
)ut he was in earnest. though light hearted;
ust a matter Of plain business as he saw il.
When n plan Of his went down no was
m deck with another and without consulta-
with either Of the principals, At last
10 proposed 10 r~eOrganize tho Lake com
any and make a large subscription for new
took. and meanwhile he was interesting
Ir. Rice In the scheme Of subscribing for
'ig blocks.
But said the witness careleSsly. the
AXE people knew nothing about that
You we're very much disappointed, I
oppose said Mr.. Howard syInpa thetically, !
all your negotiations fell through
'No. ] forgot 1t, replied Mr.. Brown.
How do you find the business Of pro-
nOw?' Mr.. Howard inquired.
Good in good times. The promoter is
he barometer Of prosperity
Have you promoted anything latelyl'
mo. nothing 10 speak about, Everything
'as fine through Mckinley administra-
on, but for a year and a half there has
cen nothing doing"
When MIR. Brown was leaving the room
members Of the committee called a
God fellowship gOOd-hy TO him. All the
are distinguished lawyers
nd veteran inquisitOrs and they agreed
ley had struck in Mr.. Brown the most in
,rmal witness OF their experience. likewise
re most refreshing.
Chairman BOutell spoke up after the
aTtinR greeting Of his associates, saying in
Jtrerne good nature,
Il thank you, Mr.. Brown. for enlightening
lie committee and the legal profession,
'e can zee now. having learned something
the promoter fertile powers, how A and
might receive propositions and each
year that they emanated from the other
yes, sir; thank you; good-by, called Mr.,
rown.