The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-01-05
U.S.. MAY YET SUE
NEW HAVEN HEADS
McReynolds Considering Grim
inal Actions NOtwiths stand
ing Dissolution.
TO CONFER WITH ELLIOTT
Reports That Directors Are
Baking on Conditions Laid
Down by Government.

WASHINGTON. Jan. T. - The successful
contamination Of the negotiations between
Atorney-General McReynolds and Presi-
dent Howard Elliott of the New Haven
road for q reorganization of the road
without a suit In equity under the Sher-
man act will not necessarily preclude the
bringing OF criminal suits against those
directors and other officials who were
responsible for the policy Of the New
Haven road under ex-President Mellen's
administration.
IL was learned on high authority by
THE SUN correspondent tonight that the
Attorney-General IL giving serious con-
alteration To plan for seeking indtct-
ments of officials of the Mellen regime and
that he does not feel that he ought to
allow himself To he influenced against
such n course merely by the prospect
that President Elliott will seek to have
the present directorate yield to the Gov
ernments demands in regard to a scheme
Of reorganization.
Mr. McReynolds regards the criminal
phases of the alleged offences charged
against the former New Haven officials
o. a problem apart from that Of pro-
curing the reorganization of the road %
~ to reestablish a condition OF competi-
ton among the common carriers of New
England. He intends to deal with each
separately, ana throughout the negota-
tons with President Elliott, which began
In October, he and his assistants have
gone forward with the consideration Of
the former as we'll as the latter problem
Elliott to. Go to washinGton.
II became known tonight that the in
formation which has reached the Depart
ment Of Justice as to the progress Mr..
Elliott II making In his reported efforts
to bring about the assent by his directors
70 the Governments demands has been
only of the most general character. Mr..
Elliott will come to Washington this week
for conferences with Mr.. McReynofis, and
then for the first time the Attorney
General will receive a definite Statement
Of the facts
II Is indicated that the Attorney
General IS by no means overconfident that
the New Haven will agree to the demands
for its voluntary reformation. He has
not set too much store by the reports
from Boston that MIR. Elliott Is making
progress"
Should Mr.. Elliott bring to Washington
this week the decisive announcement that
the present management OF the New
Haven prefers to defend a suit In equity
rather than assent to the Governments
proposals the Department OF Justice VIII
be prepared to file its charges In the
without delay.
The definite Information was obtained
tonight for the first time that the Al.
torney- General has given no promise d.
rectly or indirectly that the criminal IN
dictments would not be- sought II the road
agreed to BE good" in the future.
Authoritative statement was made that
President Elliott had not procet led with
the negotiations on the condition that the
Governments differences with the road
would end once the reorganization plan
was put into effect
Problem Faced by McReynolAs.
The evolution Of policy for dealing
with the New Havens affairs was one
OF the chief problems which the Attorney
General found awaiting solution when
ne took over the administration OF tho
Depa rtment OF Justice last spring. One
OF his first steps was the appointment or
Thomas l.. Gregory as special counsel Tor
the Government TO make n thorough In
vestigation OF the operations or the road.
Mr. Gregory's formal report to the At
torney- General was made on october s,
1918. As result of the recommendation
embodied In II II WAS said that the Gov
eminent would 20 forward with the prep
aration of suit or suits against the
road and its officials.
1t was said at the time that the publ
cation OF the Gregory report would nave
created n greater sensation than did the
report OF the Interstate Commerce Com
mission upon the New Haven which had
been made public m the preceding sum
mer.
Mr. Gregory, II was said offered to the
Attorney General evidence designed to
substantiate the charge that the New
Haven owned more than two hundred
common carrier lines in New England. In
fact every line in that section except the
rollal nv The Grand
Trunk, and that II controlled every i'm
portant steamship line that operated from
q New England port
When in December the New Haven d.
rectors under Mr.. Ellotts leadership
voted to pass the regular quarterly dvi-
Aend the Attorney-General was encour-
aged The situation stands practically
unchanged since that time SO far as au-
tual developments are concerned.