The Bennington evening banner. (Bennington, Vt.) 19??-1961, 1909-06-09
SUGAR TRUST PAYS
TENM|LLIONS TO
END SUIT
Bio Trust That Recently Had
to Pay Heavy Penalty
SUIT STOPPED SUDDENLY
Independent Refining Company That
Was Held Up BY the Trust is TO
Begin Operations

New York, June 9.-Two millions
dollars in cash, the return OF STOOo'-
900 par value of securities held as col
lateral. and the cancellation Of loan
of 81 100000 more was the price which
the American Sugar Refining company
agreed last night to pay in settlement
of the suit brought against it by the
PENNSYLVANIA Sugar Refining company
under the Sherman Antitrust act
The suit was brought to recover $780,
100000, being the triple damages al
lowed by the statute on the charge
that the Sugar Trust, It's counsel John
f. Parsons, and Gustav Kissell, bro
ker. had conspired to wreck the Penn
sylvania company through the medium
of a we'll concealed loan deal. Inc
case has been on trial before Judge
Holt in the United States District
court for two weeks but was stopped
suddenly yesterday when the lawyers
got together for final settlement in
negotiations which it was learned had
been on for some time.
Sugar Refining company's suit comes
Immediately on top of the payment by
the Sugar Trust to the United States
government of $4,000, 900 in cash as
the amount out of which the United
States had been cheated through the
use of fraudulent scales on the sugar
Weighing piers in Brooklyn. Hence
there has been a double interest in the
suit both because of the damages de-
manded were among the largest ever
asked in litigation to the Federal
courts here and because the method
by which the Sugar Trust undertook to
put its Philadelphia rival out of COM
mission were lined up beside those
which were employed on its brooklyn
piers to cheat the government out of
millions of customs duties.
There was, moreover. an element of
personal tragedy behind the Pennsyl-
vania company's suit. for the closing
down of the new plant which Adolph
Segal had built for it to compete with
the Sugar Trust and consequent de-
probation of its securities, was one
of the contributing causes in the
downfall of the Real Estate Trust
company of Philadelphia, whose pres
ident, Frank Nipple, committed sui
eide when the exposure came The
suit just settled was instituted through
the Real Estate Trust company as
holder of large amounts of the Penn
sylvania Refining company's securities
although it was brought in the name
of the corporation.
The state of facts out of which the
suit developed dates back to 1903 when
Segal built the new plant of the Penn
sylvania Sugar Refining company and
then, after tying up 100000 out of
$5,000000 of it's stock in a voting trust
wanted to borrow s1.250,O00 for some
of his ventures and pledged this stock
along with big block of the concerns
bonds and various other collateral as
security for the loan. Segal had been
in negotiation with a syndicate of
Philadelphia capitalists for loan of
S1,000,0O0 and thought the terms they
asked too hard. So, when Gustav Kis-
sell approached him asking merely
that during the pendancy of the loan
the holder of the collateral should
name the directors of Segal's Sugar
company, he readily assented.
The rest Of the story is quickly told.
hlssell was acting under the explicit
authorization of the Sugar Trust; he
named as directors himself and three
clerks, who voted not to open the
plant until the loan was paid. The
plant was accordingly locked up and
has remained so ever since Receiv-
err George H. Earle of the Real Estate
Trust company dug out the facts with
his lawyers, John w. Hutchinson, and
William d f. Junken and subsequent
ly brought in ex-Gov. Frank S. Black
and H. Enowden Marshall while Sam
uel Untermyer on behalf of certain
bondholders also Joined in the attack.