Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1909-07-01
FEDERAL GRAND JURY CHARGES
VIOLATION OF SHERMAN
ANTITRUST LAW.
TRUST FRozE OUT sEeAL
WRECKED LOAN COMPANY
Interesting Story Of American Sugar
Refining company's Unprineipled
Measures to stHe competition-In-
dieted Men to Answer in Court Next
Tuesday.


B. Thomas, president Arthur, Donner,
Charles H. Senff, John e. Parsons,
John Mayer, George H. Frazier, di-
rectors, and Gustav e. Kissel and
Thomas B. Harnett counsel for Adolpl
Segal, were today indicted by the fed
eral grand jury on charge of con-
spiracy in restraint of trade in VIOLA
ton of the Sherman antitrust Iaw De-
PENDANTS will answer the indictments
in court here next Tuesday.
The thread of events leading up to to-
days indictments may be traced back
to 1896, when Adolph Segal of Phil
adelphia, sold to the American Sugar
Refining Company sugar refinery
which he had built and for time oper-
ated at Camden, N. j. Some years later
Segal took over the old Pennsylvania
Sugar Refining Company, of Phil
adclphia, which had suspended bus
iness in 1898. BY 1903 Segal had a
now plant nearly complete and was
ready to compete in sugar refining
Trusts Fine Work.
Meantime, however, he had engaged
extensively in other real estate promo
tions and became pressed for funds.
Just at this time Gustave Kissel, a
Wall street broker, turned up with an
offer to secure for Segal loan of a
million and a quarter, which was ac-
cepted. 1t afterwards developed the
loan came from the treasury of the
American Sugar Refining Company, hut
Segal claims that at the time he did
not know this. To secure the loan for
his real estate Operations Segal en-
tered into a bond with Kissel by which
the borrower turned over, along with
other security, $4,000 of $4,000 shares
of the Pennsylvania Refining Company
and agreed. that the sugar securities
should be put In the voting trust, which
gave Kissel, or whoever he represented,
control of Segal's sugar Company.
Wrecked Trust Company.
New controlling interests in Penn
sylvania Sugar Refining Company
forthwith elected new board of di-
reetors, and this board soon afterwards
passed resolution that the Segal re-
fnery should not be operated at that
from the Real Estate Trust Company,
of Philadelphia, with whom was de-
posted the securities of the so-called
sugar trust loan. President Nipple, of
the Real Estate Trust Company, had
been made custodian of these securi-
ties. The trust company became in
volved helplessly and suspended. Presi-
dent Ripple committed suicide. After
George Fl. Earle had been made receiv-
er for the Real Estate Trust Company
in August, 1906, he claimed the Difficult
ties of the trust company were due to
pressure brought by the American
Sugar Refining Company upon Segal
for the discharge of his, obligations,
while at the same time Segal, not be-
ing permitted to operate his refinery,
was helpless to pay. Earle appealed to
the department of justice, alleging
among other things that the minority
interests associated with Segal in his
sugar refinery were being defrauded
and that the trust" in keeping the re-
finery closed, was acting in restraint of
trade and in violation of the Sherman
anti. trust law.
Justice Department Failed to Act.
The representations made by Earle
to Justice Moody, then attorney gem
eral, and subsequently to ATTORNEY
General Bonaparte were continued but
without the relief sought. 1t is under
stood the attitude of the department of
justice was that so far as the repre-
sentations had been made the facts did
not differ in theory from the Knight
case, in which the federal courts had
held that the acquisition of four COM
peting refineries by the American Su-
gar Refining Company did not consti-
tute violation of the Sherman anti
trust law.
Suit was then brought in the United
States district court at New York, the
Pennsylvania Sugar Refining Company
seeking damages of $3O,OOO,0OO from
the American Sugar Refining Com
pany. After tial of two weeks COM
promise was effected June 8. The
exact terms of settlement have not
been made public but it is Understood
the sugar trust cancelled the Kissel
note of $1,125,000 and paid Segal $2,-
100000 in cash in lieu Of the losses
which he calimed he had sustained
thru the idleness of his refinery and
returned to him the 26,OOO shares or
the Pennsylvania company, which had
been deposited as security for the loan
in 1909. 1t was this victory over the
American Sugar Refining Company
which seemed to open the way for the
federal suit against that corporation
along the lines drawn by Earle three
years ago.
TAFT WARNS REPUBLICANS.