The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1927-10-10
LONG FIGHT is \
WON To SAVE
RICH OIL FIELD
Sinclair Companies to Lose
Millions by Ruling of
Supreme Court.

WASHINGTON, Oct. 10.-The
Teapot Dome lease cancellation suit,
settled today by the United States
Supreme Court, like the Elk Hills
suit, was brought by owen j. Rob-
erts and Atlee Pomerene, appointed
by President Coolidge at the direc-
ton of the Senate to recover the
oil and prosecute the principals in
the allegedly illegal transactions.
The reserve, 1921 acres of land In
Natrona County, Wyo, has been
estimated variously to contain from
100000 to 135,OO0,000 barrels of
oil.
The Mammoth Company and two
subsidiaries, the Sinclair Crude Oil
Purchasing Company and the Sin
clair Pipe Line Company, which
were given part of the lease exploit
tation work, we're named in the
Government suit.
After the trial of this case In
March, 1925, Federal Judge T. Blake
Kennedy, Cheyenne, Wyo., upheld
the lease as valid and authorized
in 1926, on a Government appeal,
the Cicuit Court of Appeals at st.
Louis reversed the decision and held
the lease invalid and fraudulent.
UphOlds Bride Charge
The st. Louis court gave credence
to allegations of fraud and a Gov
eminent charge that Sinclair gave
$230,500 in Liberty Bonds as a bride.
Judge Kennedy had held this
evidence too flimsy to be credited.
The Mammoth company appealed
from the st. Louis decision to the
Supreme Court, attacking the de-
cision as being based on inter
ferences" and differences from in
ferences," particularly in regard to
the alleged bride transaction.
A few weeks before this last APP
peal was argued, however, the
Supreme Court decided that the
Elk Hills lease to Dohenys COM
panies was unauthorized by law and
contrary to public interest, in adj
dition to having been corruptly
made.
In conformity with the decision
regarding authority and public in
terest, President Coolidge revoked
the executive order of President
Harding under which Secretary Fall
made the Teapot and Elk Hills
leases, and this generally was taken
to indicate that the Teapot lease
also must be cancelled.
Signed by Fall and DENLY
Secretary Fall and Edwin DENLY,
then secretary of the Navy, both
signed the Teapot lease, which was
for a twenty-year period 1t was
signed April Z, 1922, and was sup
plemented March 9, 1923, by lease
providing for construction by the
companies of oil tanks at strategic
points along the Atlantic coast, to
be given to the Navy in exchange
for the oil taken out. These con-
tracts were involved together in
todays decision.
Around $26,000000 was spent by
the Sinclair companies in carrying
out the terms of the lease, accord
ing to their briefs filed. OF this,
however, $20,000,O0O was spent on a
pipe line from Wyoming to Kansas
City refining and shipping points,
which also has been carrying oil
from the rich Salt Greek field, ad-
joining Teapot Dome on the north
Will Lose Millions
Approximately $5,000,000 was
spent in drilling and other devel-
opment of the oil lands, but the
drilling and most other work was
stopped in 1924 after this suit was
filed.
One million dollars was spent on
an oil depot at Portsmouth IN. HI
Navy Yard, which was completed
and turned over to the Navy under
the lease terms.
Under the provisions of the Gov
eminent suit, the Sinclair companies
will get no compensation for any of
this 100000, and also must pay
for several million barrels of oil
taken out.