Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-12-19
RECEIVER IS ASKED
FOR GOODYEAR CO.
Stakeholder Charges Mis-.
management-President
Declares Firm Solvent.
By the Associated Press.


COLUMBUS, Ohio. December H.
Appointment of a receiver and an ac-
counting Of the affairs of the COM
pany were sought in suit filed mere
today against the Goodyear Tire and
Rubber Company of Akron by Frank
S. Monnett, Columbus attorney and
former attorney general of Ohio MI
Monnett said in his petition that ne
is the owner Of forty-five shares OF
preferred stock in the company.
that the directors of the company is
sued ~ per cent dividend last faii
when they had no surplus on hano
with which to pay 1t, and that they
derived funds for this purpose through
the borrowing of money on the sale
Of stock.
The petition alleges this stock sale
amounted to $27,000,000; that the
company received less than So per
cent and that brokers received the
remainder. and that the issuing OF
this stock was in violation of the
claims that the issuing of that stock
damaged the preferred stockholders
to the extent of $48.000.000.
Makes Other Charges.
The petition further states that on
July /, 1920, the directors issued $50
per cent stock dividend. or $31,137.-
600 in common stock. and that there
was no legal authority for such is
suance, as the company was without
a surplus Mr. Mennett's petition also
stated that the company recently
borrowed $25,000,0o0 at usurfous-rates
and thereby lost 100000.
The petition alleges that through
this investment company the Ohio
corporation has made extravagant
purchases among them being that OF
the Ford Motor Company building in
Long Island City, which was bought
for $2,00o,000, the investment COM
pany assuming mortgage of s1.750.-
0o0. Other charges made in the petit
ton are: -
His Specific Allegations.
1. Loss OF $4,000 to the Ohio cor
poratfon through purchase by the In
vestment company of a cotton ranch
near Bakersfield. Calf.
g. Loss of approximately $4,000, 900
through the organization by the in
vestment company of Goodyear Tire
and Rubber Company in California
and the Pacific Cotton Mills Company,
and purchase of the entire common
stock of those companies for $1,000, 900.
3. Loss of approximately $500, 900
through purchase by the investment
company Of $4,000 acres of land for
cotton cultivation in Salt River val
ley, Arizona
through purchase of 10000 acres. Of
rubbeq land in Sumafra.
S. Personal profit of $5.o00,00o to in
vestment company through organiza-
ton of Goodyear tire and rubber COM
panies in ten foreign lands.
Declares Company Solvent.
AKRON, Ohio. December 1S-F. A.
Seiberling. president of the Goodyear
Tire and Rubber Company. tonight de-
clared that the company Is absolutely
solvent. He added that steps will be
taken Immediately to obtain hearing
in court on a motion for dismissal Of the
suit.
follows:
.-The company is absolutely solvent.
having not only sufficient assets to pay
every dollar of its indebtedness but
enough to cover It's entire outstanding
preferred stock, leaving many millions
Of dollars for the common stockholders.
'srrue, like many other Of the country's
large Industrial concerns, the Goodyear
Tire and Rubber Company has felt the
need for ready cash because of the
present curtailment of credit and tenn
porary depression affecting business gen.
erauy As a means OF meeting this
present situation and with the purpose
of CARING for it's present obligations
and providing for its permanent fnanc-
ing. a plan has been worked out to the
entire satisfaction Of its officers. which
will be presented at a special meeting Of
the stockholders already called for De-
cember "a. 1921"