The Telegraph-courier. [volume] (Kenosha, Wis.) 1888-1946, 1923-01-25
Commission Bars Seyler
and Seyler Co., from
Selling Stock.
CENSURED BY BOARD
Railroad Board Is Severe in
Censure Of Company which
Operated in Kenosha.

| commission handed down at IL p. m.
Saturday night.
1t is of great interest in Kenosha
inasmuch as this city had been one of
the chief centers of operation for
Seyler and his companies. Hundreds
of Kenoshans purchased stock in the
companies represented by Seyler and
Joined heart and soul in his move
ment.
The decision censures Seyler and
intimates that there may be basis for
criminal action against Seyler and
the directors of the two client oil
companies, the M. T. c. and Elbukan,
he represented, and practically con-
trolled.
It held that vital information was
withheld from the railroad commission
when application for the sale. of stock
was made.
Alleges False Facts.
Actual misrepresentation Of the
status of the companies is held to
have been shown and it plainly states
that Seyler knew the company had a
deficit after fictitious sale to the
Royal Gas Co.
A decision by the railroad commits
sion either barring Seyler and his
company from further sale of stock
or unfolding him has been awaited
anxiety by 5000 Milwaukee and Wis
consin stockholders in the M. T. G.
and Elbukan companies since the
close of the Today hearing at Madi-
son, Dec. %. Stock sales in Wisconsin
passed the $2,50O,OOO mark
Shares in these companies are own
ed by widows, school teachers, and
men and women in nearly every con-
ceivable walk in life.
Seyler Held Unfair.
The decision covered 20 pages close
ly typed. It pointed out many mat
tiers in which the directors of the
companies and Seyler were held to be
unfair
How this decision will affect the
two companies is not known but the
sale of stock in Wisconsin in the
M. 7. C. and Elbukan may be contin-
ued later if the companies are put
on fair and equitable basis. Sey-
Ter or his concern, however, are alb
solutely barred from selling this or
any other stock in the state.
| The effect that the decision will
have on the stockholders of the Ell
bukan Oil Co. in their votes at the
annual meeting, scheduled for today
at the Milwaukee Auditorium, is prob
lematical. 1t was. indicated Saturday
that there would not be a quorum
present and that the meeting would
bedelayed because the anti-Seyler fac
! ton, which includes the southwestern
group, would ignore the meeting.
One point Of vital interest to all
shareholders is that the commission
may not require the return of stock
dividends, although these dividends
are held to be illegal. The dividends
are not, however, in violation Of the
Wisconsin securities law.
Censures Robertson.
The commission censured Fred Rob
ertson, Kansas City attorney, for his
share in the much discussed Mullen
deal and says that Mr.. Robertson
Ishould have called the attention of the
directors of the companies, for which
he acted as attorney, to the facts.
Liens pending caused the trouble and
made the deal illegal, directors said
after it had been put through and they
caused a loss to the M. T. G. of about
] $4,000 by turning back the lease.
Personal interest of the officers and
particularly of Mr.. Seyler and Mr..
Robertson, who, although not officers,
were directors of the companies, clear
T! ly Influenced their judgment and pre-
vented them from giving to the stock
holders the benefit of their unbiased
! action" one section of the decision
reads. ''The contract of Mr.. Seyler
| by which he was to receive 10 per
cent of all stock issued, even that
issued for dividends, gave him an in
centive that could not but work to
/ the disadvantage of persons who were
asked to become investors in the com
pany.
Forces Stock Appreciation.
at drove him to seek constant in
creases in capital, appreciate proper
ties and declare stock dividends. In
fact, it may be the very basis of the
bylaws which required that practical
| ly all new properties should be pur-
chased out of money derived from
stock sales, rather than from earnings.
Although this arrangement was
changed in January, 1921, Mr.. Seyler
! continued to resort to practices which
| were unconscionable."
! This quotation from the decision
shows the tone of it and the severity
| of the censure.
: In one section, the commission de-
clares that there is no evidence that
/ the companies were organized as stock
! jobbing proposition but rather that
they were organized with bona fde
/ intention of making money for the
stockholders.
1t also says some of the difficulties
of the companies are due to conditions
beyond their control and for which
4 their officers are not responsible, but
from this point goes on to show the
conditions which it holds to be due to
/ the officers, directors and Mr.. Seyler.
/! 'He (Mr. Seyler) made contracts for
the purchase of properties" said the
! decision, which he contemplated turn
laing over to the Elbukan and M. T. C.
companies, fixing as substantial por-
ltion of the purchase price the stock of