New-York tribune., 1919-04-12
Clausen-Flanagan Company
Brings Action Against In
ternal Revenue Collector
and u. S. District Attorney
Says Profits Are Cut
Also Complaint Declares
That p, Per Cent Beer
Is Not Intoxicating

The Clausen-F Flanagan Brewery, In
corporated, yesterday started equity
proceedings in the Federal District
Court against Richard J. McElligott,
acting Deputy Collector Of Internal
Revenue, and United States District
Attorney Francis G. CafFey. The COM
planning corporation asks a prelimi-
nary and permanent injunction to re-
strain the Federal officials from en-
forcing the prohibition reglation laws
The complaint, which was drawn BY
Guggenheimer, Untermyer & Mar
shall, sets forth that the Clausen-Flan-
agan Brewery was incorporated III
1909 with capital stock of 100000
and an outstanding bond issue OF
$ Sl,6OO.000, for the purpose of brewing
lager beer and malt liquors The plain,
tlff corporation explains that its bust
ness IN the manufacture and sale OF
malt liquors prior to January l, 1918
was more than S1.2OO,0OO, and that it
had property worth $4,000.
According to the complaint, the net
pronts OF the corporation, since its or
ganizatlon, amounted to $4,000 per an
mum.
Its Business Restricted
The plaintiff asserts that since the
adoption of prohibition statutes the
company's business has been restricted
and curtailed by the Presidents proc
lamation and the regulations and de
clsions of the Commissioner of Internal
Revenue. 1t complains, further. that
the regulations are unconstitutional
because they attempt to limit the man.
ufacture and sale of beer and other
malt liquors to those only containing
one and one-half per cent alcohol.
The complaint also asserts tha,
alcohol not to exceed ga per cent are
not in fact Intoxicating.
Judge A. n Hand in the Federal
District Court yesterday, on motion of
United States District Attorney CAT
fey, dismissed the complaint filed sew
eral weeks ago by the Jacob Hoffman,
Brewing Company in an injunction
suit against Mark Eisner, as Collector
of internal Revenue. AS Mr.. Eisner
resigned his position about the time
the suit was filed Judge Hand, on mo-
ton Of William Guthrie, substituted
Richard McElligott, the acting col
lector, as defendant in place of Mr.
Eisner
New Complaint Broadened
Colonel Galley argued that the at
tempt to substitute Mr. McElligott for
Mr.. Eisner was a misapplication of the
statute of 1899, allowing changes to
be made in event of the resignation or
removal of departmental official and
an attempt to introduce supple
mental complaint broader in scope
than the original one
resolution opposing the legaliza-
ton of two and three-q quarter per cent
beer was unanimously adopted by the
New York East Conference of the
Methodist Episcopal Church at yester-
day afternoons session 1t reads in
part:
Whereas, vitally important matters
concerning the moral and religious well
fare of the people of this state are now
pending before the state Legislature,
be it
"Resolved, by the New York East
Conference of the Methodist Episco-
pal Church, in joint session with the
Laymen's Association of the same
church, to. protest to the Legislature
OF New York against the passage of
the two and three-quarter per cent
beer measure, and respectfully re-
quest of the Legislature adequate en-
forcement of the prohibition law"