New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1915-08-17
other Reorganizers Also
Accused of Fraud by
English Capitalists.
s2,S4S,4S7 PAID;
WANT MONEY BACK
R,jtishers Say They Were
Duped Into Buying
Securities.

c,~,o,ius Vanderbilt and Otto 7.
p.,nsrd are two Of the defendants in
anti brought in the Supreme Court
porrke. Schif & Co, bankers and
Ss.lsrs. Of London, and Cecil A. Gren-
~ English fnancier, TO recover 81
ISIS from the members Of the reor-
-..;,stion committee Of the Southern
s...l Company. The plaintiffs, who in
'r5s Viscount Acheson. allcge that
49, were induced. by false and fraudu-
=. concentrations, to invest the
.mop,t sued for in securities Of the
steel company ,,.
The defendants besides Vanderbilt
- Barnard are Robert Z. Van Cort-
Is,st Franklin Q. Brown, Walter 7.
po.en. William P. G. Harding and
william Woodward, as executor OF the
ss.ate Of James 7. Woodward.
sTore ~ the acts alleged in the COM
.ls;nt are made against William WOOD
P.o -5 personally, and his part as de-
ser5snt is only as the legal representa-
tive Of the estate Of James i. N9ou-
~srd who was president Of the Han
over National Bank.
Fraud Charge Made.
The plaintiffs allege that the false
-..-c.erta-ors regarding the status
80 he Southern Steel Company were
" nv William W. Miller, attorney
for The reorganization committee ana
pobsr. Van Cortlandt. q member OF
.t..or,--i+-ee The London bankers say
=, men, N-tle about Van COrt.andt,
~ .bav were ACQUAINTED with oiner
49, NJ the committee. especially
Vanderbilt. Barnard and Woodward.
T. res because these latter members
accented responsibility for the repre-
ss~.e..o0s made. say the plaintiffs s..
.bo+ -bev invested. In August, 1905, the
attendants constituted the reorganl-
-et,or committee Of the Southern steel
Corr8rv. Miller. it IS alleged, as
their attorney represented that the rea-
con for the corporatjon's trouble was
tbst Il bad failed 20 provide at the
enc Of go. organization sufficient work
ING carftal to meet the eXlgencles OF
certain unforeseen financial condl ions
which subsequently arose OUT Oh IHe
He explained that the chief object OF
the reorganizatiou committee was 70
suprIv this deficiency hy the sale OF
$4,000 600 worth OF securities, hall OF
which was 20 be applied 20 proFlde
working capital. The remainder OF the
proceeds was 90 be used 10 the payment
Of debts and IN defraying the cost OF
certain additions and improvements 10
the manufacturing plants.
Miller. I- Is stated uy the plalnuhS'
said that with this additional facility
the earnings would amount 70 at least
Sl20..00o year above all hAea
charges
Van Cortlandts alleged part in these
REPRESENTATIONS was the writing OF let
ters 10 Frederick II. Allen, for sub
mission 20 Grenfell, in which he re-
itera,ed what Miller had already SAID.
A pamphlet entitled plan and Agree
ment OF REORGANIZATION mdslng
roseste promises as 10 the future OF
the steel company, was also put out.
Alleged False Statements.
T. was with faith in all these va
rious representations that The plaintiffs
were induced 10 execute q subscription
Some Of these alleged false state
ments were that the total value Of the
Southern steel Compauy's property, IN
eluding that of it's several subsidiaries,
Was between SlGO00,0UO and S2O.OVO,olp,
"whereas.' says the complaint, the
total value was not more than $4,000
900, as Van C0r,landt and Miller well