New-York tribune., 1913-06-18
STEEL SUIT D|SCL0SES
MQRCAN'S FAITH IN MEN
Financier Formed Corporation
Without Scratch Of Pen
from Carnegie, Says Reed.
FAIRNESS CONCERNS AIM
Il Would Have Hit Somebody
on the Head Had / Been IN
Judge Gary's Place."
Witness Declares.

Former Judge James Fl. Reed, Of Pitts
burgh. a director Of the United States Steel
Corporation and chairman Of the direc-
torate Of the Carnegie Steel Company.
subsidiary Of the Steel Corporation, while
testifying yesterday afternoon for the de-
fence In the government hearing TO dis
solve the corporation. told a story which
showed the implicit confidence J. Pier
pont Morgan placed in those who had
large business dealings with him.
He related how Mr.. Morgan suddenly
realized. although be had been instru-
mental in the organization Of the United
States Steel Corporation, that in the event
Of the death of Andrew Carnegie there
was nothing to show that the ironmaster
had agreed to sell his holdings. "One day
Mir Morgan came TO the realization" said
Judge Reed. that he did not have even the
scratch Of a pen from Mr.. Carnegie to in
dicate that he wished to sell out, although
Mr.. Morgan had gone ahead and made
contracts.
"Mr. Morgan thereupon gave instruc-
tions TO me and Francis Lynde Stetson 70
run up and see Mr.. Carnegie We found
Mr. Carnegie In his library. A secretary
was taking dictation and opening his mail.
There were so many letters that boy was
sent up from the Office Of the Carnegie
Steel Company TO open them. We asked
Mr.. Carnegie TO dictate one certain letter
that Mr. Morgan wanted. This Mr.. Car
negie did"
Judge Reed did not have a copy Of this
letter He said he was satisfied after a
search at Mr.. Carnegie's home that Mr..
Carnegie did not have one either. Mr..
Lindabury asked the witness If he could
identify the answer sent Mr.. Carnegie by
Mr.. Morgan. He said he could not.
That is not necessary, anyway con-
tinued Judge Reed. LAS Mr.. Carnegie
was leaving he said 'Perpont, I am the
happiest man in the world. l have un-
loaded this burden off my back on TO your
shoulders. l am off to Europe"
Judge Reed has been actively connected
with the steel industry for many years
both as a lawyer and as an officer In the
companies that make steel. He declared
II was a fact that both Mr.. Carnegie and
Henry c. Frlck were anxious 10 sell the
Carnegie steel Company before II was
taken over by the United States Steel
Corporation.
In telling Of the business policy Of the
corporation Judge Reed said:
My education with the Carnegie COM
pany was TO go out and get the business.
II was the policy Of the Steel Corporation
10 treat competitors with exceeding fair
ness-I might almost say Christian for
bcarance / think if l had been in the
place Of Judge Gary in the corporation l
would have hit somebody over the head"
This comment brought laughter from the
counsel and people in the room.
Judge Reed said he attended a number
Of presidents meetings and at them he
always heard stress laid upon the idea
Of fair dealing with competitors. Judee
Gary always spoke along those lines, he
maintained As for the Gary dinners
he declared he had generally been pres
cut and the first one, he said. held
while the panic was on looked as blue
a. could be" as the steel business would
have been in bad shape had the money
panic continued.
Judge Gary would exhort US Ike a
Methodist preacher in camp meeting"
no SAID, tellnB us not 10 cut prices ana
get everything into our own net. The
policy laid down at these dinners and
followed out saved a thousand men from
bankruptcy. There were men all over
the country loaded up with goods They
had 10 have time to work of their stock.
II prices had gone down these men would
have had TO sell at reduced prices, and
ruin would have followed
Did you ever sic anything cabalistic
a these Gary dinners?" asked Mr..
Lindabury
II saw nothing strange done thera, "
was the reply. Judge Gary talked 10
US. as did several others" The witness
said he did not recall ever having at
tended a meeting whore the subject Of
"armor pools" was discussed
At the morning session William J. FIJI
bert. controller Of the Steel Corporation,
again took the stand. lie introduced
into the record another mass Of figures
tending TO prove the contention Of the
defence that since the corporation was
formed prices have tended downwaId
and competition has been stimulated
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