Evening star. [volume] (Washington, D.C.) 1854-1972, 1912-01-24
Tells of Dealings With Steel
Corporation Subsidiary.
COULDN'T OBTAIN TUBES
Had Contract to Equip Bennington 8
Boilers.
WAS UNABLE TO CARRY IT OUT
Testifies Before Steel Trust Investi-
eating Committee About Shelby
company's Opposition.

Richard II. Gray of San Francisco
charged before the House steel investigat-
ing committee today that the United
States Steel Corporation forced him to
default on contract to rebuild the gun
boat Bennington In 1906
He declared that after the government
had awarded the contract to him in COM
petition with the Shelby Steel Tube Com
pany. subsidiary OF the steel corporation,
conspiracy prevented him from buying
seamless tubes necessary to carry out his
contract. He protested to the Navy De-
partment. he said, and new bids were or
dered, the contract being awarded to the
Shelby Company at a price 81, 100 higher
than his original bid. The $1,1OO. Gray
declared, he was compelled to pay to the
government by a decision OF the Secre-
tary of the Navy
Mr.. Gray said the Shelby company So
licited business from him in boiler tubes.
Prior to 1901 and 1902 he had no diff
Guilty in getting orders for tubes filled
for the Mare Island navy yard.
Obtained Government Contract.
II introduced the seamless tubes for
the government at Mare Island" he said
Later ! found a change in attitude
toward me from the Shelby Tube Com
pany. They notified me that they could
not fill my orders ] found they were
prying into the sources OF my business
trying to sell for themselves. In 19O6 1
got O. government contract to supply
seamless tubes to the sunboat Benning-
ton. 1t was the Bennington which blew
up in San Diego harbor a few months
prior to the time its boilers were to be
re-equipped. My bid for the repairs was
about $13.OOO.'
Who else bid on the contract?'
bids were opened in San Francisco
and Washington. NY bid seemed to have
been the only complete bid of the entire
schedule. The government sought to
have all the material come from one
source"
The witness related how eventually he
was unable to carry out his contract be-
cause Of inability to get some Of the
materials.
Couldn't Get Boiler Tubes.
II was unable to get the boiler tubes"
said Mr.. Gray. IT had been Informed
that the Shelby Steel Company had been
told not to sell me any more of these
seamless tubes and I tried to purchase
from other companies. the Scully Steel
and Iron Company and Joseph T. Ryer-
son. both Of Chicago. who were large
customers of the United States Steel Cor
poration. / could not get the materials
from any of them. My correspondence
seeking material from large dealers got
into the hands Of the Shelby Steel COM
pany which also bid on this contract.
The Shelby company's bid on boiler tubes
was next lowest to mine"
The Shelby bid. he said. was filed with
the navy pay Office in Washington. and
he had no knowledge of It. after l got
the contract I made every effort to get
the tubes" he continued. First / made
direct effort to buy them from the
Shelby Steel Company's agent in San
Francisco. I failed, and all my efforts
to secure them from other sources met a
like fate. / asked the Detroit Steel Com
pany and requested that. IL they were
unable to sell me, they would not for
ward my correspondence to the Shelby
company. They did not sell me, and ig-
nored my request and sent my corre-
spondence to the Shelby Steel Company"
The witness gave long list Of firms to
whom he applied. all of whom referred
him to the Shelby Steel Company. and he
turned to that company as q last hope.
Turned Down by Shelby Company.
'.I addressed this company August IA.
1905, requesting a Geographic answer of
the price they would make me en- the
tubes for the Bennington"
Did. they know then the government
had awarded you this contract" asked
the chairman.
TT was seventeen days after the award
of the contract. I called at the COM
panys Office in San Francisco q week
later and was advised by the agent that
he had been instructed to say that the
shelby company had bid on this contract
and 1 could not get the material"
Stanley Committee Surprised.
There have been no business dealings
between the United States Steel Corpora
ton and the International Harvester Com
pany for five or six years. according to
the testimony Of President James A. Fa.-
rell of the steel company before the Stan
ley committee yesterday afternoon. The
committee was surprised, and showed 1t.
Representative McGillicuddy of Maine
questioned President Farrell about the
export business of the steel corporation,
and rebates given to certain companies.
Isn't 1t q fact that the Internal onai
Harvester Company gets larger ieba es
than are granted smaller concerns?" Mr..
McGillicuddy asked.
No Business for Years.
1--WE have done no business with the
International Harvester Company for five
or six years." Mr.. Farrell replied. The
International Harvester Company has had
a boycott on this corporation 1t all grew
out Of q controversy between one OF our
subsidiary companies and the harvester
company. 1t started as mere bubble