New-York tribune., 1920-09-29
General Denial of
Ryan Charges Made
By Stock Exchange
Answer TO Plaintiff Explains
june Trial When Expul-
sion Was Voted; Says
''Corner'' Was Proved

"A general denial Of the charges made
by Allan A. Ryan against William H.
Remick. president, and other members
and governors of the Stock Exchange.
in connection with the events leading
up to the suspension of trading in
Stutz Motor shares on March 81 last
was contained in a reply served yester-
day on Mr.. Ryan's attorneys. zStaneh-
field & Levy, by. Carter, Ledyard &
Milburn, lawyers for the defendants.
The answer. will be filed to-day in the
Supreme Court.
Mr.. Ryan in his complaint fled last
August asked 100000 damages be-
cause of the action Of the exchange
governing committee in suspending
trading in Stutz stock and for expelling
him as a member of the exchange.
The brief of the attorneys for the
Stock Exchange reviewed the history
of the Stutz affair leading up to the
decision of the governing. committee
that corner existed in the stock on
the last day Of March, when it sold for
1891 share. and Mr.. Ryan's expulsion
as member of the exchange on June
%. The brief alleged that on March
20 Mr.. Ryan admitted to the business
conduct committee that the stock had
been cornered and subsequently made
statements that he and his associates
not only held substantially all the
stock of the company, but held in addi-
tlon contracts for the delivery or re-
turn to him of many thousand shares
Of "said stock which those who were
obligated to deliver or return the same
could not obtain from any source ex-
eept from him or his associates"
Referring to the trial on June 90,
when the exchange governors voted to
eSpel MT. Ryan as a member Of the
exchange. the reply to the plaintiffs
charges said:
iwenty-nine members Of the gov
erning committee besides the president,
being more than two-thirds Of all the
members of said governing committee,
were present at said trial and partici-
pated IN said adjudication. Said Allan
"A. Fyan did not appear before the gov
ernlng committee upon said trial, not
"lthstandlng the fact that he had been
notlned that he was entitled to be per
sonally present, and would be per
m1tted IN person to examine and cross
examine all witnesses produced bv the
committee, and also to present such
testimony in defense or explanation as
ne might deem proper, nor did anv
one appear at said meeting or request
half. ''' MS De-
"Cpon said trial the charge and
speclf1catioa was read, and also The
answer of Allan A. Ryan thereto, and
evidence was presented before the gov
ernlng committee that tended to ans
Tain and did sustain the charge and the
specincatlon. and especially tended to
n1onth nmow and dld show that during the
month OF March, 1920, said Allan A.
ryan created a corner in Stutz Motor
various firms Of brokers until he had
OBTAINED substantially all of said stock
mere was in the market outside of
that held by himself and his associates.
and held in addition thereto contracts
Tor the delivery or return to him of
several thousand additional shares.
which could not be obtained from any
source except himself and his asso-
clates; and that after he had created
SAID corner he sought to make use Of
the some to extort from those who
were liable upon contracts to deliver
or to return said stock, but who were
unable by reason of the existence Of
the corner to obtain the same, arbi-
trary. excessive and unreasonable
amounts in settlement Of their liability
upon said contracts, and did in fact ex-
tort from them in settlement of said
contracts arbitrary, excessive and un-
reasonable amounts"
The brief pointed out further that the
settlement price Of tie short contracts
that carried over from March 81 was
S05l .25 share, comrared with an al
legged book value Of the stock on De-
cember 81, 1919. Of 1922 a share.
With regard to the charges of Mr.
Ryan that certain governors of Stock
Exchange firms were short of Stutz
stock, the brief goes into great detail
in its denial and concludes that in the
cases specified none Of the governors
was short for their own account, but
only for the account of customers. In
some of these cases it was stated that
the stock of the Stutz company had
been delivered prior TO March 81 and
there fore WAS not involved in the set
tlement Of the short contracts.