New Britain herald., 1926-11-23
DEFENSE CLAIMS
 Sl00,000 A LOAN
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 that the banks in his part of the country were small and could not handle large sums"
 Hogan said Doheny told his son to get the money. \ It was placed in "a satchel" and taken to Washing ton and delivered to Fall, who wrote out demand note for the sum-
 No Interest Stated.
 ITO show you how young Doheny ! regarded the transaction, when Sec retary Fall handed him the note, " 1 continued Hogan, "he examined it and said. Mir. Secretary, you have i not fixed an interest rate Fall replied, Ed, your father did not state the interest rate, and I do not want to dictate that. If none is stated. this note will bear the legal | rate of interest
 Tore on Signature l The lawyer said the elder Doheny, 1 in order to protect Falls investment in case of his own death and that l of his wife, tore off the signature and gave it 9 his wife. who placed it in safe deposit box in Los An geles. It would be shown, Hogan said, that the transaction had no re- latlon to the oil contract and leases and that Albert B. Fall did not ex- ecute the leases. did not suggest them and did not recommend them.' The defense attorney said the pro- l ject to store oil at Pearl Harbor, Hawaii, originated at a. conference in the Navy department on Dec. 5, 1921, after naval officers had report ed Japan was raobilizing vessels for an attack on the Hawaiian Islands and the Philippines.
 Urged Him to Bid "The idea was born in a patriotic sense of duty. for the defense Of our country" he osid. But as late as Dec. Is, nearly month after the loan to Fall. Doheny had writ ten to Admiral Robinson of the Navy department that his company would not go into the Pearl Harbor mat ter. After this, Hogan said, Robin son had a personal conference with Doheny. outlined the Japanese sit uation and urge him to bid.
 with blanched face, Doheny said he would give . promise that his company would bid as it was a pa triotic duty to do so,' Hogan said.
 He said the secrecy surrounding these developments was due to the fact that Theodore Roosevelt, jr., as acting Secretary of the Navy, in writ ing the interior department to go ahead with the Pearl Harbor project. requested that since this involved the secret war plans of the navy, se- crecy should be preserved.
 Opening Is Peaceable.
 The opening preliminaries today proceeded peacefully enough after the clash of yesterday, when oppos- ing counsel argued at length wheth CT the jury should be kept under guard during the trial. That initial ioust ended with victory for the government when Justice koehling granted the governments motion for a locked up jury.
 When he opened court this morn- ing the justice called attention to the rule permitting only one of counsel on either side to examine witness, and only two on each side to argue the case.
 Reviews Legal Steps.
 Roberts reviewed the legal steps which led to original establishment of the naval oil reserves. The act of 1920, he said. specifically took these reserves out of the hands of the in terior department and placed them under the control of the navy, but retransfer was made by the executive order of May 3l, 1921, signed by President Harding.
 Secretary Fall had been in charge of the reserves only a short time, Roberts said, when he suggested 10 Secretary Denby (of the navy) that he could work out a plan whereby royalty oii could be used for storage. Secretary Denby approved that plan. but later he wrote a letter saying there should be no drilling except of offset wells on the edge of the California reserve
 Fall Asked for S10O,O0O.
 Roberts then told the jury that while negotiations for the contracts between Doheny and Fall were on for the Pearl Harbor Storage con- tract. Fall discussed his Financial af- fairs with Doheny, and asked him for S10o,00o
 "Doheny caused his son 10 draw sl00, GOO from his bank account in bills of large denominations and to bring it here 10 Fall. who gave his demand note,' continued the gov 6rnment attorney. The whole trans action was shrouded in secrecy. Fall took the money in cash to Fl Paso, where he paid over most Of it to purchase a ranch adjoining his own at Three Rivers, New Mexico"
 Tried to Conceal Decd.
 The expenditure of this sum be- came known to the senate commit tee. said Roberts, and Fall did not tell the truth about it, but tried in every way to conceal it.
 I've shall show that three other companies declined to bid on the storage tank contract because they held it to be Illegal" he added. Despite this and the opinion of the solicitor of his own department and of the legal officers of the depart mant of justice. Fall went ahead with the execution Of the contract"
 Roberts sought 70 impress tpon the jury that an important part Of this contract was q provision giving Dohenys Pan-American Petroleum company preference rights 70 future