New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-01-29
GOVERNMENT COULD NOT
PROSECUTE 1T.
1ction Barred by Supreme Court
Decision-Mr. Bondparte Explains
the Segal Case.

ton demanding Of the Attorney General the
correspondence regarding the Sugar Trust and
the effort of Mr. Earle. o: Philadelphia, to in
duce the government to become a party to
suit against the American Sugar Refining Com
pany for alleged violation of the Sherman anti
trust act in connection with the Pennsylvania
Sugar Refining Company. The correspondence
indicates that Attorney General Moody and At
torney General Bonaparte both held that. under
the decision of the United States Supreme Court
in the Knight case the government had no
cause for action.
The Presidents message follows:
In accordance with my direction. the Attorney
General has forwarded to me the inclOsed papers
in response to the resolution OF the Senate OF
| January 22 1909. in reference TO sending the
Senate copies Of ali correspondence in the De-
partment OF Justice relating to an alleged VIOLA
tion of the act of July ?, 1890. by the American
Sugar Refining Company. in connection with an
alleged loan by that company SegaL in
which was pledged security therefor major
ity of the capital stock of the Penns yvania
Sugar Refining COMPANY with voting power
thereon. and under which II is alleged an agree
ment was entered into that the Pennsy ylvania
Sugar Refining Company should not engage in
business" and l herewith transmit them to the
| Senate.
The message was ordered TO be printed and
| lie on the table It is expected that Senator
Culberson will call 1t up later and submit some
remarks based on the correspondence. In his
letter to the President transmitting the corre
spondence Attorney General Bonaparte wrote;
am aware of no reason why the papers
should not be made public
MR.. EARLE'S COMPLAINT.
The correspondence includes a large number
of letters which passed between George II Earle.
jr., receiver of the Real Estate Trust Company.
of Philadelphia. which failed in 1906 and the
President. and between Earle and eX-AttOrney
General Moody and Attorney General Bonaparte
Mr. Earle first wrote President Roosevelt on
September q. 1906 calling attention 10 the failure
of the Real Estate Trust Company, Of Phladel-
phia, and suggesting that he may have been
msled TO the most potent cause OF the failure
by the published explanation that loans TO
Adoph Segal promoter. by President Hippie
of the institution were responsible. Mr.. Earle
told the President that this explanation was the
truth but not the whole truth. In asking Execu-
tive cooperation Mr.. Earle suggested that the
President had "a plain duty" and said.
write YOU because the information before me
/ satisfies me beyond doubt that these loans
would have been largely, II not entirely. Ilqui-
1atei but for the criminal conduct oil file ST.
called Sugar Trust. Ii is my deliberate conciu-
sion after weighing the evidence that have col
Iected with the greatest care. that had II not
been for a criminal conspiracy Of the most
odious character. not Of Segals or Hipplcs but
,f the Sugar Trust this instit5Ition and SegaG
himself would have been perfectly S"4'ehl 10
day.
The letter was a sweeping indictment ~ the
Sugar Trust. which Earle declared pcrmeates
the financial life Of the country. He said that
the American Sugar Refining Company had
become interested in some Of SegaFs enterprises
according to Mr Earle. through the construction
by Segal of a modern sugar refinery. The trust
gained possession of the plant through loan
"a Seeal TO promote other enterprises, and he
learned too late that the refinery was not TO be
| operated Earle declared that repayment Of the
A. attop,,,tSd nv SpEaI and the trust de-
cHnad 10 receive the money. Mr.. Earle said:
NO honest lender ever declined such PROPOSE
tion"
40 GROUND FOR PROSECUTION
The correspondence showed that President
Roosevelt referred the whole subject 10 eX-At-
tornev General Moody and later 1t was surren-
dered to Attorney General Bonaparte. and that
both of those officers corresponded Mt great
length with Mr. Earle looking to prosecution
of the so-called Sugar Trust
In = printed document marked confidential"
| there we're number Of letters which we're ex-
| changed bv Mr. Earle and Attorney General
! Ronanarte between April 4 and April Is
Mr.. Earle took the position that there had been
| n violation of the Sherman law, and suggested
in one of his letters that the Assistant Attorney
! General seemed perfectly satisfied the Knight
ga Sc had no relation to ours and, as nave un-
derstood him has always been confident that he
could send these Conspirators to jail
| The Attorney General in his letters had quoted
1he decision i'm the of the United states
against the F. e Knight company as his reason
for not proceeding against the Sugar Trust on
the facts submitted by Mr. Earle Commenting
on the governments attitude, Mr.. Earle wrote:
vou will see from the marshalled facts that
,,our assunption that the Sugar Trust in THIS
case acquired controlling interest as was
found in the Knight case, does not exist here at
all 1t never lawfully ACQUIRED any interest IN IN
the property or in any stock controlling the
property as in the Knight case II. by fraud
iner<Iy obtained control over a trustee 10 pre-
vent his exercising trust. whose eXpresseu
,,rnose ,yes to prevent the very sitting of the
/ comnetition which II accomplished ny ts oHse
conspiracy here
II anpeared from the last Of the correspond
opce a letter from Mr. Earle TO the Attorney Cen
araI dated April 49, 1907 that the joint issue was
on the question to whether the knight case
annlisd and Mr.. Earle finally closed win the
statement that he would leave the matter with
the people
rho ease of the United States against the T. Z
Knight Company and others was decided III IaEo'
NJ the sugar company by the United states gu
nrene Court on January Il, 1895. The suit was De
e7,n in the Circuit Court for the Eastern District
- paprsvrvana TO compel the defendant com
nanes-the American Sugar Refining company 'ue
i G Knight Company, the Franklin sugar Co"i-
-ar, tbe Sprcckels Sugar Refining Company anu
tho delaware Sugar House-to cancel the contracts
@ ,,ot the stocks of the last four named corpora
tions were sold to the American COMPANY through
John E. Searles, jr- in exchange for American
.on,pauy stock the ground that 1t was IN VIOLA
ton of the act July >. 1890. and In restraint OF
trade. A.
| Co,,rt If Appeals affirmed the decision. The Su-
! pra1,e Court in deciding against the government
r1,Iai that the complained of related exclusively