East Oregonian : E.O. (Pendleton, OR) 1888-current, 1910-06-13
Orchard Development Com
pany Stockholders Fight
Among Themselves.
tMATILLA MEMBERS
ACCUSED OF FRAUD
Montana Stockholders i'm Land Com
pany Alleges Local Members Held
Illegal Meetings and Sold Stock to
w. Il. Thompson-H. II. Loughlin,
One of Defendants, Explains Tran
sactiOn-Says Montana People Tried
To Play Frcczout Game.

end of the county and control of a
corporation owning the land, are the
bones of contention in another big
legal battle, the first gun of which
was fired saturday. At that time a
suit was filed in the United States
court at Portland, in which S. P.
Wright, c. w. Smith, G. NJ. Russell,
T. 5. Lane. Olaf Lundwall, d. w.
Grieve, j. r. Afflerbaugh, E. w Fos-
ter and Lewis r. Anderegg are plain
tiffs, and the Orchard Development
company. H. r. Loughlin, Bertha E.
w. LOughlin, n. D. Loughlin, w. L.
Thompson, r. N. Stanfield, Inez
Standfield and j. n. Burgess are de-
PENDANTS.
The Loughlins live at Hermistop
and the other defendants in various
parts of the county. The plaintiffs
live in Montana. The Orchard De-
velopment company, corporation in
which all of the above people with
the exception of the Stanfields have
an interest and being the owner of
tract of about 200 acres of land
near Hermiston. which was purchas-
tt from MI. anu MTs. SldllllSlu
Illegal Meetings Alleged.
The complaint charges that the. de-
fcndants held illegal meetings of the
corporation and sold stock to w. L
! Thompson and that the Montana
stockholders, who constitute the plain
tiffs. were msled as to the purpose
of these meetings by the form of the
| notices which were sent, and it also
asks an accounting from H. r. Lough-
! lin, treasurer, for the moneys which
| have passed through his hands.
Mr.. H. r. Loughlin, secretary and
| treasurer of the company, was in
town today and. when seen, gave the
| following version of the transactions:
Mr. Loughlin states that the COM
pany was organized about four years
ago. with a distinct understanding
that the properties We're to be i'm
mediately placed on the market and
I sold, and that he has ever since that
time been endeavoring to get the
| Montana stockholders to go ahead
with the proposition, but that the
Montana people have not been able tc
agree among themselves as to what
should be done with the property
! some desiring to hold it and others
| to sell, and that they We're constantly
embarrassing him in his efforts to
successfully handle the affairs of the
company.
This condition of affairs has con-
| tinued for two or three years, until
! it became necessary, in order to meet
| the payments on the contract, the
Montana people having refused to ad-
vance further moneys for this pur-
pose, to raise funds in some manner
Mr.. Loughlin states that he submitted
! the proposition to the attorney for
| the company and was informed that
the entire holdings of the company
| would be lost and forfeited under
their contract if they failed to meet
their payments. He then proceeded
to call a meeting which, under the
| advice of the corporation attorney
was entirely regular and, after can
vasspg the situation from every pos
sible point of view, it was decided
that the only feasible method OF
| raising the money was the sale OF
| some $1,000 shares of treasury stock
| in the corporation. The directors ac-
cordingly proceeded to sell the stock
and the same was submitted to local
capitalists, among others Mr. Thomp-
| son, who, after investigation, pur-
chased the stock.
Freezout Game Alleged.
According to Mr.. Loughlin's state
ment. as soon as the Montana stock
/ holders learned that he had succeeded
/ in raising money to handle the af-
/ fairs of the corporation and to defeat
/ their purpose in endeavoring to freeze
! him out, they Immediately began ef-
forts to wreck the corporation, by
publishing paid advertisements in
Umatilla county papers calculated to
/ discourage investments in the corpor-
alton property, and dscrediting him.
| They came to Hermiston and without
notice to the Umatilla county stock
| holders, attempted to hold a meeting
without a majority of the stock be-
! ing represented. and attempted to
take the control of the corporation
away from the Umatilla county stock
holders and to elect their own men,
bers and two Hermiston men, to whom
| they Transferred two dollars worth OF
stock each, as directors, to contrtol
the affairs of the company. Lough-
J lin, on learning of their purpose tele-
I phoncd to the other Umatilla county