The Washington times., 1914-06-07
'I25,OOO,OOO SUIT IS
NEW HAVEN SEQUEL
Estate, William Rocke-
feIIer, and Ledyard to Be
Made Defendants.

The tangled affairs OF the New Haven
7 lroad. which have been the object
c searching inquiry by the Department
G Justice and the Interstate Commerce
onmission. are now threatened with
& airing In the courts. Coincident with
E s1nouncement Of the close OF the Inter
ate Commerce Commission investiga-
IN into past New Haven scandals.
6 announcement is made in Boston Of
ans by New England stockholders of
enc road to bring a N2S,ooooo0 suit
gainst the ]. Pierpont Morgan estate,
William Rockefeller, Lewiss Cass Led
yard, and other directors. who have
Hsen under fire IN connection with the
alleged looting of the road.
Meanwhile the Department of Justice
- engaged with two angles of the New
iaven situation. The Bureau Of In
vestigation has been engaged for
-lonths IN the most searching inquiry
into New Haven affairs, with a view to
,lncovering evidence sufficient for the
criminal prosecution Of hnanciers re-
sponsible for the alleged losses of mil
ions to stockholders Of the road and
It's subsidiaries.
To this evidence has been added the
-estimony taken at the Interstate Com
rnerce Commission investigation, where.
after the question was raised as 20
whether. by testifying under oath,
Charles s. Mellen had gained immunity
Iwo other directors, Lewis Cass Led
ard and 7. De Witt Cuyler, were per-
,nitted to testify only on condition that
hey would answer questions without
ond rrar ryaiNinR anV I'M
nunity rights.
Dissolution Plan Held Up.
The other angle of the New Haven
situation engaging the Department Of
Justice is that concerned with the vol
.ntary dissolution OF the. road under
lie plan agreed 70 by the new manage
ment The details Of this plan have
cen practically worked out, but delay
.as been caused by the failure, thus far,
& the Massachusetts, legislature to pass
legislation permitting the transfer of
ridley holdings of the road from the
Doston Holding Company to the trus-
ices provided for in the dissolution
Dlan.
Sharp conflict between the stockhold-
ers and the present management Of the
road, on the one hand, and the men
Eliminating New Haven affairs during
tho Mellen regims has been evident dur
ing the Interstate Commerce Cornmis-
sion investigation The stockholders, by
vote, almost unanimously approved the
plan of the Elliott management for the
separation of the properties. The suit
now threatened in Boston indicates
that they have hopes of recouping past
losses through civil suits against Nor
gan. Rockefeller, Ledyard and other d.
rectors. r= . -.-
The stockholders, while agreeing to |
the dissolution, declare that this viii |
net bring back the millions lost in past |
transactions When the Department Of \
Justice failed to make restitution a |
part OF the program Of reorganization, |
they decided to bring suit, and have en-
gagged Sherman L. Whipple, an able |
interests. |
Millions Are Sought.
The millions taken out of the New
Haven till and expended in Improbable
investments which the stockholders will
seek to recover by suit include:
The $50 Ooo. 900 to s1oo,0oo.OoO used in the |
acquisition of New England trolley lines |
by. the New Haven; the $50 0o0,0 900 spent |
IN buying up the Boston and Maine;
the $l1, 10000 which went for the West |
chester deal; the transactions in which |
Billiard and others figured. involving |
commissions and Investments of New
Haven funds which have been under
fire
Whether the Interstate Commerce
Commission investigation will be re-
opened. or whether q report Will be
made to the Senate in response to the
Norris resolution on testimony already
brought out. has not been determined
Commissioner McChord. in closing the
hearings late yesterday, declared that
II the commission decided to hold any
more hearings II would notify those
persons wanted as witnesses.
The final evidence adduced brought
out a charge from David Z. Brown, an
examiner for the commission, that If
the books of the Morgan company were
correct, there had been a Justification
of the records of the New England
Navigation Company, one of the New
Haven subsidiaries The Navigation
Conpanys records, he said, failed TO
disclose the sale of the Worcester,
Nashua & Rochester road by the New
Haven, although Morgans books
showed such a sale was made through
that firm.
The question Of feIsifcation of rec
ords is. certain TO be further investi-
gated, and evidence adduced in this d.
rection, according 70 present plans will
be turned over to the Department of
Justice. il