Evening star., 1927-10-16
FALL AND SINCLAIR
WILL FACE COURT
Teapot Dome Case to Open
in D. c. Supreme Court
Tomorrow.
tcontinued from First PaSe9

States.
Then follows President Harding
executive order of May 81. 1921. com
uniting the administration and con
conservation of the oil lands in Cali
fornia and Wyoming to the Secretar,
Of the Interior, subject TO the super
vision of the President. The order
specified that no general policy as tc
drilling or reserving lands located il
a naval reserve shall be changed ol
adopted except upon consultation ana
in cooperation with the Secretary oi
Acting Secretary of the Navy. THE
Secretary of the Interior was author
ICED and directed in the order To per
form any and all acts necessary foi
the protection. conservation and al
ministration of the reserves.
Gist Of Indictment.
Secretary Fail then = a<<,fmed ant
undertook the admins. .raficn and con
servation of the oil;1,earing properties
including Teapot Dome. and owing tC
fire fact that oil wells were in opera
tion outsitIe and near the reserve he
was uEder the necessity of consider
ing whether offset wells should ba
ScjFIed to prevent the draining of oi
NEm the reserve.
Having determined that such wells
nnould be drilled the indiCtn> mt de
clareS, lit became his lawful Guty &c
procure. by the usual methods of con
tract and lease, the drilling of suCt
wells in the least number required by
the situation then, existing and on
terms the most advantageous to the
United States" Numerous persons
and corporations, competent to de
Such work the indictment declares
were dasirous of entering into con
tracts and leases, among them being
the Producers & Refiners Corpora
tion, the Texas Co, the Texas Pacific
Coal & Oil Co, the Aero Oil Corpora
ton. the Midwest Refining Co, the
Pioneer Oil & Refining Co. Societe
Bel2o.Americaine des Petroles du
Wyoming. Gerald Hughes, John {.
Shaffer, Pat Sullivan and Harry +.
Sinclair.
The indictment then declares that
instead of ascertaining which of the
foregoing persons and corporations
could and would undertake the drill
ing of the wells upon terms advan-
tageous to the Government and in
stead of advertising for and calling
for and permitting competitive pro-
posals and bids by prospective con-
tractors and lessees. Fall, upon the
request and at the solicitation OF the
said Harry r. Sinclair -
fradulently was to award to the said
Harry F. Sinclair or TO a corpora
ton to he organized, owned and con
trolled by him." the Mammoth Oil
Co, a contract and lease, granting and
leasing to the company the exclusive
right and privilege TO drill for, mine,
extract, remove and dispose Of all the
oil and gas deposits in or under the
Teapot Dome for a period of 20
years.
This contract contained provision
whereby the Mammoth Oil Co. would
receive the royalty from crude oil
accruing to the United States, in eX-
change for which it would construct
oil storage tanks along the Atlantic
and Gulf Coasts, filled with oil and
gasoline for the use of the Navy.
The lease and contract were 10 be
entered into without advertising for
competitive bidding upon terms
enormously profitable to the lessee
(the Mammoth Oil Col" the indict-
ment sets forth. The contract and
lease involved the making by Fall 'of
false representations and statements
to such other persons and corpora
tons, to the effect that the leasing of
said naval reserve and the making
of leases and contracts for the drill
ing of such Offset wells, or Of amy
wells upon said property, were not bet
ing contemplated" either by Fall oF
the Department of the Interior or the
Government land to the effect that
when the said Albert r. FAN and said
Department of the Interior and the
Government of the United States were
ready TO award such leases and con-
tracts ali such other persons and cor
porations would be given notice of
that fact and accorded an opportunity
10 make proposals and bids for leases
of the said property and contracts"
covert Acts" Listed.
As a. result of these Statements"
by Fall, the indictment declares, other
persons and corporations were fraud.
ulently prevented from competing
with the said Harry F. Sinclair and
the said Mammoth Oil Co. for the oh
tanning of such leases and contracts
and the United States was thereby
deprived of the benefit of such com
petition and defrauded of its property
useful to it's Navy"
Instead of keeping his mind and
! judgment free from partiality, bias
and prejudice Fall "corruptly, secret
~ and surreptitiously was to accept
from the said Harry F. Sinclair and
the Mammoth Oil Co., and they were
corruptly secretly and surruptitiously
TO give To said Albert B. Fall, large
sums of United States Liberty Loan
bonds as loans and gifts, whereby the
said United States was 10 be de-
prived of its property, pecuniary in
terests and rights and the benefit of
such competition, as aforesaid, and
of the honest. unbiased, impartial
and preiudiced service of said AL
bert B. Fsll, as Secretary of Interior.
touching the matters aforesaid" the
Indictment says.
The overt acts" listed in the in
dictment are: TIE application and
proposal of Sinclair for a lease and
development of Teapot Dome on the
ground that it will be vastly more
valuable To the sNsvy Department To
have its oil in secure, steel storage.
which does not leak. and which is
above ground, than to have the oil
underground, where it is subject to
being drained and perhaps totally
lost TO the Navy and far remote from
where it could be used"
The application of tf = Mammoth Oil
Go. for the lease of Teapot Dome and
its approval by Fall on March IL
1922; his letter of March 80. 1922, to
a Colorado attorney who had applied
for information about leasing the re-
serve, in which he said the Govern
ment has only been granting leases
or permits to offset wells" TO protect
The property against encroachment of
private owners; his oral statement to
another inquirer at the department
March 20. 1922, that he had not de.
termined upon n policy with respect
~ the lease of Teapot Dome, but that
he would advise the applicant as TO
its adoption when such policy should
he deter mined uron: that on April :,
1922, ne signed the lease to the Mann
moth Oil Co.; that Sinclair. on or about
May s. 1922. delivered, or caused To
be delivered" to Fall, and Fall IRE.
ceived, or caused to be received" from