New-York tribune., 1908-01-15
ATTACKS G.. & A. MERGER
OLD ALTON STOCKHOLDER
Wants Present Company Enjoined
from Exercising OYnership.

An action attacking the consolidation of the Chi
cago & Alton Railroad filed late last evening
in the United States Courts by William Starr
Miller, of Chicago, a minority stockholder. The
petition says the plaintiff has been for twenty-five
years the of 500 shares of the stock Of the
old Chicago & Alton road. with a par value of
s50000 He complains that ne did not consent TO
the consolidation by the Hartman interests, nor
did he exchange his stock, earning, as he alleges
an annual dividend of per cent, for the new non
cumulative stock for which it exchanged bic
under the consolidation agreement Mr.. Miller asks
that the present Chicago & Alton company be en-
joined from exercising ownership in the prop
critics of the old Chca 90 & Alton. and further, that
separate accounts be kept Of the earnings of the
road and the income of the original property be
applied TO payment of dividends on its stock, and
tnat an accounting of the profits wrongfuly and
Illegally realized from the road be ordered
The petition says that of the original Alton
there were outstanding DID, zoe shares of stock, OF the
par value of 500 each Between 1898 and 1860 the
syndicate, consisting OF E. H. Hartman, Mort-
mer W Schf George J. Gould and James Still
man. Mr.. Miller charges. bought 372 shares or
the roads preferred stock, there being but 54'fSo
Of it outstanding and also acquired 1S34lb or the
old roads 49, 511 shares of stock, leaving
only 70 shares of preferred and 1855 of the common
not in their control In April, 1900, it is alleged, the
Chicago & Alton Consolidated was organized, with
a Capitalization OF S490000O equally divided between
the common and preferred stock Subsequent 10
this action the petitioner charges. the syndicate
transferred it's holdings TO Louis l.. Stanton, who
personally had interest in the road, but VINO
negotiated it's sale to the new Chicago Alton IN
terests receiving 100000 for the 3'23 shares OF
preferred and exchanging the common or the olc
company for 1S4 $50 shares of the preferred ana
1a5 42s shares of the common stock of the new
consolidated corporation. While the syndicate
held the original preferred stock II IS aeged' 1t
received dividends amounting to N,0A66o on the
preferred and 1885, 40 the common the latter
stock having cost, according to Mr. Mlller
s32.064ZJa-
After the consolidation was effected, the petiton
charges, the syndicate bought the 81 LOUIS
Peoria & Northern Railway for sL0a0o and
sold il 10 the new c. & A. for 100000 Then the
old rreferred and common stock held by the syn
dicate it is charged hypothecated with the
Farmers Loan and Trust Company TO secure d
bond issue loan of s22,oN0oo, but OF this sum-
Mr. Miller says. the road got only sS0Sep' S5""-
900 having been used TO pay for the St LOUIS
Peoria & Northern Railway and slo"o"0 to pay
for the preferred stock sold by the Messrs Stiil-
man Hartman, Gould and Schif.
Mr. Miller declared he did not exchange his 500
shares of stock. which had paid him 5000 semi
annually. for the new per cent non-cumulatiVe
stock as his original holdings entitled him TO par
ticipate in the surplus profits of the company, a
privilege denied him as the holder of the new
per cent shares The exchange. he asserts. was IN
violation of his rights stockholder A state
ent of the earnings of the c. 4 A. is given, with
the further allegation by Miller that the figures
show the road is not earning sufficient money
for distribution among its stockholders. although
the earnings ample before the consolidation.
In addition Mr.. Miller's five hundred shares
there still remain in the hands of the Farmers
Loan and Trust Company, outstanding security
for the s22 900 oan it alleged, 34723 shares OF
the preferred and 1S3,124 shares of the original
common and prior lien stock Mr.. Miller says the
new officials offered him the dividends upon the
stock he was entitled TO have in exchange but tha t
he declined them. The petitioner says he made d
demand for his proper dividends and received two
payments of $3.50 each, but was told last October
thar the separate accounts demanded could not BE-
kept.
Mr. Miller submits also twenty-five interrosatories
| which he asks the defendants be compelled to
answer all of which tend show the actual earn
nes and profits of the road, both before and after
| consolidation and all of the disbursements since
! thar nerod Philbir Beekman & Menken of No. 81
| William street are the petitioners counsel.