Evening star., 1927-10-16
Teapot Dome Lease Is Basis
of Fraud Charges by
Government.
CONTRACT CANCELLATION
BY COURT is RECALLED
Action Is Second Taken by United
States Since Deal Was
ConSummated.

Albert r Fall of Now Mexico. Tor
mo-, Senator and Secretary of the In
terior IN President Harding's cabinet.
and Harry +. Sinclair, New York oil
macnate and sportsman, Will he placed
on trial tomorrow morning in Criminal
Division of the District Supreme
Court, before Justice Frederick l.. Sid
dons and a Jury 10 be selected, charged
with conspiracy to defraud the Gov
ernment in connection with the lease
of Naval Petroleum Reserve No. IN
wyoming, otherwise known as Teapot
Dome.
The trial will open exactly one week
from the day the Supreme Court OF
the United States Cancelled the Teapot
Dome lease given to Sinclair by FAN
holding that the lease was mane
''fraudulentIv by means OF colluSion
and conspiracy between them. ana
more than 10 months after the ceie'
hrated trial OF Fail and Edward j..
Doheny of Los Angeles who were
acquitted on "A charge of conspiracy TO
defraud the Government in connection
with the Elk Hills, California Naval
Reserve lease. The proceedings VIII
he held in the same room as the Fan
Doheny case.
The case to go on trial tomorrow is
different from that which the supreme
Court disposed of last Monday, in
that the highest court was concerned
with a civil suit on the part or tne
Government TO cancel the tease anu
regain possession of the Teapot Dome
oil reserve and not seek punishment
for anv alleged offenders. The case
was decided on the proponderance OF
evidence and no consideration was
given to a charge of bribery.
Money Involved in Suit.
In the criminal proceedings, how
ever. the question Of money, In lhe
form of Liberty bonds, passing from
Sinclair TO Fall following the lease
"a alleged by the Government, pays
an important role, but proof must De
ests blished by the Government on the
entire case 90 the satisfaction Oh
jury beyond a reasonable ooae.'
The trial tomorrow is the second OF
fo,Ir crjminel suits instituted by tne
Government as the result OF the m
nuirv into the leases. In the nrst'
held here also, Fall and EDWARD L.
nohenv were acquitted of the chdrse
of conspiracy. The third ana Ioq.t,,
trials are still to come. In one an a..
faces a charge OF bribery anu ''ie
",
From the standpoint Of the puOnc
and the legal profession, interest," III
4on,orrow's trial will center arouhu
the annearance or non-appearance OIL
ono of the Governments witnesses
II M Rlackmer, who at the time Oh
the Teapot Dome lease was chal,
man of the board of the Midwest
Refning CO., subsidiary OF ths
standard Oil Co. of Indiana. ne anu
James f. ONeil, president 1 .ne
prairie Oil and Gas Co. at the 'lhe
- taase was signed, went to Europe
raveral wears ago and have remained
there ever since, as far as can De
learned here Many efforts were n'aue
10 serve subpoenas on lhehi' anu
while Blackmer was served Twice. Wy
zn American consul, O'Neil so far
has not been served.
The Government has desired tneH
testimony. 1t is UNDERSTOOD III coil-
pection with the evidence relatlng 10
the liberty Bonds and on two occa'
sions postponement of the trial was
asked and granted in the expectation
that the two witnesses would return
TO this country.
should Blackmer fail to appear TO-
morrow in answer to the subpoena, ne
will be dealt with under the walsh act
in this manner: The Government coun-
the subpoena and proof of the default
on the part of Blackmer. Then 'he
court will issue rule citing Blackmer
in contempt That rule Will be malled
10 the American consul nearest 10
Rlackmer's location, if he still - IN
Europe, and it will specify ia" tor
his appearance in Justice Slddons
court to show cause why he shouln
not be cited for contempt.
dPCi6QG
ru,e he may 90 into court with his at
torneVs argue the matter and take d n
appeal on being adjudged and fned d
sum not to exceed 800 900 as provided
by the Walsh act.
BIacIGmer's Appearance Doubted.
As soon as the courts citation is is
sued United States Marshal Edgar &.
SNYDER will be directed by the court
10 seize any property belonging to
Rlackmer in the United States. Should
T2lackmer ignore the rule, whatever
nroperty has been seized will be sub
iected to sale in lieu of the hne I'M
nosed by the court in the event OF
;Blackmer being adjudSed in con-
tempt.
Although the punishment for stand
Ing in contempt of court may be Sc
yere. what the Government desires
p,ost-Blackmer' testimOny-will not
be available, and he will be the victor
in that respect alone,
The fact that the Government VIII
nroceed with its case, even though
i;lackmeT may not appeal. was taken
tn mean last night that the meat OF
the matter did not rest with TINS VII
ness or ONeil either. 1t was sald AZ
The office of the special Government
counsel that the prosecution did not
expect Rackmer to appear.
The Indictment, under which the
two men will be tried. was presented
10 the District Supreme Court May u,
1925. 1t opens with the order with
drawing Naval petroleum Reserve No.
q in Wyoming from settlement loca-
ton, sale or entry for the exclusive
use of the Navy, which was signed by
President Wilson April 80, 1915. This
is followed by the act Of June 4, 1920,
which provided for the taking by the
Secretary of the Navy of possession of
all properties within the naval petrO'
leum reserves, including the one men
toned in President Wilson's order of
withdrawal for the conservation, de
velopment. use and operation In the
discretion of the Secretary. directly oi
nv contract. lease or otherwise and the
use, storage. exchange or sale Of the
oil and gas products thereof and Of all
royalty oil from lands in the nava
~. Nx.l.