The Oskaloosa herald. (Oskaloosa, Mahaska County, Iowa) 1885-1919, 1911-11-23
ROCKEFELLER ORE
| ROAD DEAL AIRED
John D. Is Accused Of "Squeez'
ing Owners.
CALLED LOAN TO FORCE SALE
Padded Reports and Other Illegal
Methods In Acquiring Iron Range
Properties Testified to at
Steel Quiz.

Washington, Nov. 22.-How John ID.
Rockefeller acquired the Duluth, Mes
saba & Northern railway by calling
loan of s., 600, 900; how he forced own
ers of shares now paying $500 yearly
In dividends to sell for $50 a share;
how reports were padded, and other
methods employed by the steel trust
in getting possession of 100000 in
ore property we're testified before the
Stanley investigating committee
Charles H.. Martz of st. Hilaire, Mimi,
formerly chief engineer OF the road
testified with bitterness how the Mer-
rit brothers are alleged to have been
squeezed out of the road by Rockefel-
Ter.
Il is the intention of the committee
TO show that the steel trust secured
control of this outlet In an illegal
manner and that the railroad started
by the Merritt brothers has been pay
ing the steel trust dividends of from
$50 TO 200 per cent.
Tells of Padded Report.
Martz furnished startling testimony
concerning a padded report furnished
TO the Minnesota Railway & Ware
house commission in 1898 by the then
Rockefeller road. Martz said that the
commission was after the railroad be-
cause OF its rates, and because OF this
and under the instructions OF Joseph
b. Cotton, attorney for the road, the
report had been padded. For instance.
Martz cited one item of gravel pit
which cost $4,000 and which was list
ed in the report to the commission at
s192, 900. Altogether, the witness tes-
tilted, the report was padded about
100000.
Mr.. Martz said he owned a few
shares of stock, but was informed that
Rockefeller did not favor the idea OF
employees owning stock in his property
and that he would have to sell it. He
said he took $40 a share for stock that
is now paying 5000 per share each
year in dividends.
Stock Mysteriously Disappears.
He also testified to the mysterious
disappearance of 10 shares Of his
stock which were used as collateral
for the Rockefeller loan. He said this
stock went to Rockefeller's Office with
other shares in the Merritt brothers
mining property, but that he had never
seen It to this day.
II was told by Rockefeller attor-
ney," said the witness, that so long
as did not start an investigation my
job would be safe. l needed the job,
70 l did not do anything"
The road cost altogether about 81
100000, Martz testified, but by the
time the financiers added commits
sions, appreciations and charges Of
various kinds the amount was boosted
for nearly sS,000,000, the amount the
Minnesota commission was told the
Rockefeller property was worth.
Rockefeller Called Loan.
Rockefeller called the loan," said
Alfred Merritt of Duluth, "and We were
unable to pay, so he took all our stock
which We had put up as collateral in
the Consolidated mines and railroad
properties"
Charles NJ. Schwab has testified"
said Chairman Stanley, that this ore
property in the Mesaba range is owned
by the steel trust and is worth $780,
100000"
Mr.. Schwab is about right" said
the witness.
And you put up practically this
amount" continued Stanley, for a
call loan of only $4,000 from Rookie
feller?"
That is correct" said Merritt
Merritt testified that he had sued
John d. Rockefeller on account of mis-
representation In the deal and obtained
a judgment for $4,000. The court OF
appeals reversed the verdict, but
rather than let the matter go to court
again Rockefeller suggested a compro-
mise, understood to have been about
100000, which was accepted by Mer-
ritt.
This was the approximate cost to
the oil king of the vast Merritt hold
ings in the Mesaba range.
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