Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1910-02-07
ONE WAY TO Get
RICH is SHOWN
If You Are Railroad President
It's Easy to Pick up Loose
Change.
ILLUSTRATED IN COURT
Suit for lawyers Fees Bares Deal In
vOlving Leading Men in the
Railway World.

| Chicago, Feb. 7.-Financiers and
railroad men Of national reputation are
in volved in a dazzling tale Of high
finance" told in a brief which Otto
! Gresham, as administrator of the late
John S. Cooper, filed in the appellate
court yesterday.
The brief reveals for the first time
what is said to be the whole inside
story of the sale of the Indiana, Illinois
& Iowa-the "Three-T'-railroad. The
plaintiff defeated in the lower court in
a suit for fees claimed by the Cooper
estate, draws the complete picture in
defense of his case, hoping thereby to
secure a reversal of the adverse de-
cision of the trial judge.
Big Men in List.
The dramatis personae are:
Theodore P. Shonts, former chief en-
gineer of the Panama canal and presi-
dent of the Interborough system of
New York and head of the Alton and
allied railroads.
Francis NJ. Drake, Shonts' father-in-
law, one time owner of the "Three-I"
railroad
Paul Morton, former secretary Of
the navy and now president of the
Equitable Life Assurance society.
Joy Morton. president of the Inter
national Salt company
William G. Brown. president of the
Illinois Central railroad and allied
lines.
Robert 44atheFy--fe -feEmer- president
n
road.
John s. Cooper, Chicago attorney.
Lawyers Fees Basis of Suits.
And the last of these. though dead.
is in many ways the most important.
for fees alleged to have been earned
by him in the "Three-I" transaction
are the basis of the suits. The first
action, in the municipal court, was lost
before Judge John H. Hume, who ruled
that the bill of particulars failed to
give a detailed statement OF the dates
on which the alleged services were
rendered.
Here are some OF the methods by
which, according to the brief, the de-
fendants cleared a net profit of 81, $780,
900 on an investment of $2,500,000 Of
borrowed money:
Took Trafnc Away.
The "Three-I" road runs from Strea-
tor, Ill, to South Bend, Ind, where it
connects with the Lake Shore. Mr..
Brown was vice president of the latter
and Mr.. Shonts was general manager
of the former road when the sale was
effected.
1t is alleged that they conspired to
divert traffic from the ''Three-I" road,
sending freight by circuitous routes to
and from its stations to avoid the use
of its tracks.
Then, when the road was doing the
least possible business. they are said
to have got Paul Morton to go to Cen
terville, Iowa, to Drake, Shonts' faith
er-in-law, and buy the road from him
for $3,OOO,000.
The road had s6,o0O,0O0 capital stock
authorized. of which $5,O00,000 had
been issued and $1,000 900 was still in
the treasury. The purchasers are al
legged ito have borrowed $2,5O0.O0O by
pledging the whole $6,OOO,O00 of stock.
Used Rebate Fund.
The additional $500, 900 necessary to
pay Drake his $3,O00,000 was obtained
by taking that amount from fund of
$500, 900, which had been earned by the
road in rebates, but which, it is al
legged. had been concealed from Drake,
its owner.
Drake was also required to pay on
a bonded Indebtedness of $1,S00,000.
The $2,5O0.OO0 borrowed from Red
mond, Kerr & Co. is said to have been
repaid Immediately, and the stock re-
deemed with money obtained by issu-
ing new bonds.
Having obtained the road. tactics are