The Waterbury Democrat. [volume] (Waterbury, Conn.) 1917-1946, 1940-03-14
ROwley w. Phillips
Correspondence Read
As Early as 1927 Local Broker Described Cana
dian Business as Gesture" - 81 ,OO0,O in
Stock Sold to Connecticut Investors.

The name of Rowley w. Phillips,
local broker, figured prominently in
the evidence heard at yesterdays
session Of the so-called "McKesson
IL Robbins case in which q $21 ,000,-
900 shortage Is alleged to exist in
the company's funds and is charged
to Mr.. Phillips and four other men.
Several letters allegedly written by
Mr.. Phillips were introduced and
placed In evidence in an attempt on
the part Of the government to prove
that Mr.. Phillips Is guilty Of con-
spiracy and using the mails to de-
fraud. In addition to this Mr.. Phil
lips name was mentioned several
times in the presentation of EVIL
dence.
George E. Dietrich the first wit
ness placed on the stand yesterday
told of how hair tonics were sold
by q McKesson & Robbins affiliate,
which contained a high alcoholic
content, which could be washed out
and used for bootlegging purposes
He said that Mr.. Philips along with
Mr.. Merwin, another Of the de-
PENDANTS faced his brother with the
bootlegging rumors and that his
brother Coster-Musica said, that II
bootleggers got the alcohol loaded
hair tonic after 1t got on the mar
ket 1t was no concern of McKesson
& Robbins.
Phillips and Merwin laughed 1t
off" said Dietrich. Dietrich's testi-
mony concerned the corporate set
up of McKesson g. Robbins and Its
affiliates.
AS to the Canadian concern, late
in the afternoon his testimony was
to the effect that the concern was
an utter myth and that the COM
pany never did things 1t said in
the prospectus advertising the stock
1t would do.
1t was concerning this prospec-
tus, the subsequent sale Of stock,
and the whole proposition that Mr..
Phillips wrote frequently.
Within a few minutes, the gov
eminent introduced three letters,
all written on Sept. 20, 1927, by
Mr.. Phillips, and all concerned with
McKesson g. Robbins, Ltd.
In the first letter, introduced Just
before the luncheon recess, Mr..
Kaufman quoted Mr.. Phillips as
writing to Mr.. Merwin on August
10, 1927, and terming the Canadian
company partly a gesture"
Mr.. Merwin replied, saying he
had destroyed the letter and adj
vising Mr.. Phillips that British and
French interests were tough to buck
in Canada.
useful As Gesture"
Wrote Mr.. Phillips on August 10,
1927, to Mr.. Merwin:
LAS far as the Canadian business
is concerned I think 1t is useful as
a gesture and do not think there
would be any point in considering
developments there seriously for
some little time. I understood that
a corporation there would cost only
$1,000 or at the most $4,000 and that
1t might be of considerable adj
vantage strategically.
THE whole affair Is getting to
a point that almost staggers my
imagination. We all want to be
very careful to do the right thing
but at the same time we must al
ways keep our eyes open for the
same chance and for opportunities
that seem as though they should be
grasped in this connection.
Through his letters, Mr.. Phillips
urged haste in the formation of
the company, at one time pointing
to sloppy stock market" as one
reason for dispatch in handling the
scheme.
His letters outline the method of
selling the stock, the Bridgeport
Trust Co., the r. F. Griggs & Co.,
a Hartford investment house, and
New Haven firm handling the stock.
A 100000 issue of preferred stock
was finally sold to the public, the
majority of the common stock be-
Ing given to the Connecticut con-
Germ as a consideration for patents,
etc., and guaranty agreement
guaranteeing 100000 net profits to
the Canadian Company, available
for dividends.
A letter OF Oct. ~, 1927, to Cos
ter "a copy was sent to Mr.. Mer-
VIM said:
Richter OF Hartford, is very anx-
ious 10 come into the deal and has
accepted this share as participation
but growls very much at the size
OF II. Bradley, OF New Haven, is
pleased and will work along Just as
knew he would. Incidentally. he
tells me that Whittlesey thinks that
there must be something illegal
about McKesson a. Robbins OF Con-
nectlcut as he cannot see how
drug business can be 80 successful
and 50 profitable.
"An Old FOgey"
@nradley says that he does not
pay any attention 10 Whittlesey
and he thinks that WhIttlesey Is