The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1915-04-20
Federal District Court, After
Admission of General COun-
sci That Concern is InsOl-
vent, Takes Charge of 1t.
Ex-sECRETARY OF WAR
ONE OF MEN SELECTED
Application of American Steel
Foundries Company, Based
on Claim of $4,000, Basis
for Action.

Chicago. April Gothic Chicago.
Rock Island and Pacific Railway coni-
Inny wnu placed in the hands OF re-
ceivers In Judge Carpenters branch OF
the United States district court here
today. The stock dropped ten points
ON the New York stock exchange.
The company admitted is inability
10 meet more than $4,000. 900 in short
term notes and other obligations due
between now and May first ana tho
court appointed ~. &. Nudge, proal-
dent of the company and jacob NJ.
Dickinson, former secretary Of war,
receivers.
Application Tor the rocoivorship
was made oy the American steel
FOundrita company which has a
claim OF $1,000 against the defend
ant. a. g, Ridgeway. vice president
OF the railway company. and W. y.
Dickinson, its general attorney, ap-
peared In court. Answering the poti-
uun. i,idgeway stated that receiver
snip was the best means of protecting
creditors. bond and stockholders and
collateral Interests.
The railway company was the basic
property In the formation of the Rock
Island company which Is said prac-
tiealiy 10 have disappeared from the
hnancial nmb and the Chicago. ROCK
Island and Pacific Railroad COM
pany. which actually opognled the
road. 4, has been Va the hands of d
receiver appointed In New York for a
considcrablo period.
Inquiry OF the iogal department OF
the road as 10 the present Atutus OF
the Rock Island company. whi,h IA
turn owned all uf the stock uf tho
railroad company. eliCitcd the reply;
1T seema To- have disappeared. It's
only asset was the railroad company
the stock Of which dropped to "A dol
lar ur so, and its fate can be imAsin-
cd with such assets"
Tho bill nlcd by the minority stock
holders sooKing an injunction alleged
that the railways debts aggregated
22AS. .0OO.0 10 was stated further
that the stock Of the company, which
sold in 1902 al 100, has sold as low as
40 "a share. IL WIS stated that the
Reid Moore interests were still In
control.
Stockholders of the railway COM
pany held thCis annual meeting here
April - last after federal court had
dcciilcd 10 enjoin the meeting on Pc
tition Of counsel Tor minority stock
holders RumOrs OF apparently au-
thcntic origin al the time we're cur
rent that the company was insulvont.
With reference To the imam iial
management OF the properly, cOnsid-
cradle testimony was introduced two
months ago IN the course of the arbi-
tration OF the wage demands OF the
fremen and engineers Of western
railroads. w. J. Lauck, a statlstlcian
employed by the men, In an exhibit,
said
The road came under control OF
the Moore brothers and Daniel q,
Reid IN 1901. Al that time began the
dissipation OF the great resources OF
the company as well as the manipula-
tion of its securities by which The
Rock Island ana the Chicago. Rock
Island ana Pacific Railroad company
were launched. The total amount OF
fictitious capitalization with which the
railway company Is now burdcned "
enormous"
Petition Tor a receiver for the Chi
cagp. Rock Island aud Pacific Rail-
way company was flied in the United
states district court here today by the
American Steel Foundrios company.
The defendant company is the op-
Grating corporation which. according
10 Information gained at the general
offices. has never before been numed
In such suit,
Ralph NJ shaw. OF counsel for the
American Steel Foundries company.
stated To Judge Carpenter that the
Rock Island had admitted its inabr-
ity TO meet obligations aud that Tor
the bcnont Of stockholders. bOndhol1-
crs and other creditors his client was
moved to ask for receiver.
JudEe Carpenter asaed why the
hondholders had not made the appu-
cation instead of the foundries conn
puuy aud the lawyer explained that
thus far the company has not de-
faulted on is interest on bonds.
IN exhibit presented az the wage
arbitration proceedings Of western
rail.nads here gave the ownership of
the property involved IN the suit as
follows;
The Chicago, Rock Island and Pa
cine railroad Is controlled by the Rock
Island company through ownership OF
the entire capital stock The Chicago.
Rock Island ana Pacific railway II