Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1914-07-02

The United DRY Goods company, a
bl,O00,000 corporation, financed several
years ago by j. =. Morgan * Co. to
lake over other Clafin interests. is not
Involved in the failure. Neither is the
Associated Merchants company, owned
by the United Dry Goods company and
which in turn owns one-half Of the II. b.
Clahn company and number OF other
large stores, principally in New York.
Mr.. Clailn. who was president of both,
the Dry Goods and the Associated Mer-
chants companies, resigned those posi-
tons to-day and 1t is understood that
when the II. b. Clanin company is re-
organized its connection with both the
former companies will be permanently
severed Cornelius n. Bliss, son of the
late New York dry goods merchant Of
that name, was elected to succeed him.
CAUSES OF FAILURE.
According to Mr.. Clafin the failure was
due to the unprecedented shifting of trade
centers in New York city, which COM
PEELED the concern to rely mainly upon its
retail stores in other cities for it's pro-
fits.
'Their rapidly extending business" he
said, has occasioned large capital re-
quirements which we have not been able
to meet
The crash came to-day after vain eff
forts had been made by Mr.. Clafin to
induce j. P. Morgan & Co and other
Wall Street banking interests to loan
him money to tide over his embarrass-
ment. These bankers, it was learned, ad-
vanced the company several million dol
lars about two weeks ago, but the hum
dreds of note holding banks throughout
the country continued to press their
claims until it became evident that vir-
tually the whole $50, O000 would have to
be raised to save the company from fail
ure.
BANKERS REFUSE AID.
Mr. Clafiin at conference lasting I'M
til after midnight last night with j. p.
Morgan, J. S. Alexander, president Of the
National Bank of Commerce, Albert H.
Wiggin president of the Chase National
bank. and other tinanciers, made a last
appeal, but the decision went against
him. The bankers believed that recev-
ership and a reorganization of the H. b.
Clafin company which would include its
separation from the United Dry Goods
company was the wisest course to pursue.
At this meeting Mr. Clahin is said to
have announced his intention to resign
from the latter two concerns.
To-day John A, Eames, vice-president
of II. b. Clafin company. filed a friendly
suit In equity against It, alleging that it
was unable Mt present to meet its liabil-
tiles, and this being admitted by the com
pany, Judge Hand in the federal court
appointed as receivers Joseph b. Mar
tindale, president of the Chemical Ma
tional bank, and Frederick A. Juilliard,
dry goods merchant
PETITION IN BANKRUPTCY.
Almost simultaneously a petition in in
voluntary bankruptcy was filed nv throe
merchandise creditors whose ATTORNEYS
announced they would seek the apnoint
ment of other receivers In this action
Rubpoenas were issued for Mr. Claflin
MI Eames and Dexter n Force, treas
urer Of the company, to appear and show
cause on or before July why 1t should
not be adJudged bankrupt.
Immediate steps to protect the interests
of the note holders and the merchandise
creditors were taken by the appointment
of committees representing each. The
note holders committee of which j. S.
COMPANY'S FOURTH CRISIS.
The failure to-day marked the fourth
financial crisis of the II. b. Claflin com
pany since it was first established In this
city In 1S43 with the Arm name of
Buckley Clafiin, 1t was tided over
financial difficulties during the Civil War
when southern debtors refused to meet
their northern obligations; again in the
panic of 1878; and again in the panic of
1907, when. 1t Is understood, j. 7. Morgan
a Co, came to the rescue.
From Its humble beginning of seventy
Xaars agO. Lhe concern GlaW u ~ tha