Clipped from US, New York, New York, New York Times , May 5, 1915
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SEEKS TO ANNUL000III V V[VBONDSi-James Pollitz Asks Court to Re-!strain New York Central11iIssue Already Sold.itOPPOSES A Stock INCREASEIt!C. H. Venner't Relative ChargesCommission* to Morjjan Co. andUnderwriter* Were Exorbitant.--PIbi(\rt(1VIwA fruit *as filed y^stCrday in the Su- 0prpme Dourt by Janitsj PoUiLz against \ «*the Ne*i t;York Central ; Railroad Company, the New \ ork Kealty and tlTerminal Company, and against a num* ‘ber of Directors of th* two corn-panles. *» eking the arm ifm* nt of th«* re lt;ent Issue of nlt; v York (ntffti twenty- lt;ar ♦’» ; 4* f*r * n*» rli!»Iedebenture bonds londs wereactually issued and dispo*# d of In entirety on May 1. but tlje -uit contains IsinHdithe delated p*ea that thje d* fondants be ITlrestraineu from Ls-court i* aK•• iu:ng jthlt;Tentoibonds. The j fa m the pro- ||jo*rd increase of the C; .r.tiization of*y •»«ap::a»Jzai;on oi | he the New York Central t;r m; I Mto 54lt;*i,,i at p ph. n was con* temp’ted t p-rmit f t;.r onve.s.on o:the new debent : h into bti kThe individual u**:* i i.jn\s are WilliamK. Vanderb.Jt. Chaui. C y M. L» pew, Krederick W \ anderbul Wiiiiam Rock-I...” , • , I SUHi*1Cefelier, W illiam li Nevnian, George t li.iker. Marvin Hughtt, Vvi; uvm K. Van* tierhilt. Jr . Alfred il. Stoiith. Harold S.\ dinlrrlMit, ogd«*n M,.* It »berl S. Jxjv-eit, llni.u i: i. And:* a*. Leonard JlJ*lt;kn«*Y. and Crank J I/* r uneJ a i nrs 1'oiIltjB. tin* plaintiff, is theman who recently won a judgment ofapproximately |«LOOu,lt;«^ against threelHrectora of the Wabalj Railroad Com-tany. It was admitted; y-sterday that lu* was relate*! by mafri. ce to C. H. Wnner, who has brought several suits against corporations contemplating reorganisation, Ti.- P iitz suit follows the unsiicc* sf 1 j lan • i V* i;n*r to stop the a onsolidatlon o: thJ * i New York Central A: Hudson Rlvijr road with the Iaike Shore and the s iuent unsuccessful plan of Ymnerj U prevent the Issuing of the debentures byappeals to various public rvicr com-nN.eons* m th* States tHro -;h which the New York Central llnefc pass. This is the first time an att»*mpjt has been made jlu an- ru’.rt to enjoin the issuing of the new securitiesda51P*mt51P.Jterj:*A.tiiP.ir12It barge of Wnkfefulneaa\\kin2 rC.,tireThe principal contention in the complaint us that the $lhisue is #* unnecessary and ” and illegal, and that it will rfrsu'.t in a loss totiie New York Central) Railroad Company and to Pollitz, asj a holder of 120shares of the comjuny.it is contended further that the ► per cent, interest pi id on Jne bonds is ex* cessi\e and above the; market rate of i * ;linterest. j IA large part of the complaint i* de- j r voted to tne arrangement whereby the j one bonds were di^po^d ofj nbr this ar-rangement J P Morgan A- to., a- fiscal agents i»f the Nb*w ^ hrk t'eniral. re-ceivtnl .i flat Ip* r lt;lt;{nt. or the (MMie for th*or er* ^ In a Iditiona s ndicate. headt-d bylJ. P. Morgan A* *» , received -1,* per c|*nt for guaranteeing to dispose of alj h«»nds not sub-•* rib# .! for by stockholjiers of the NewYork Central. it wasi permissible for |•tolt; kholders to suba* r|b*% for the new bonds to the extent of 4*» per c»*nt of their holdings Th * ftvndi ate s commission of 2S per cent applied to all bond* cjtcept those pure1 ased by Directors of the New York Central.it is alleg’d in th cjomplamt that a number lt;'f the ,def# ndapt Mrectors are interested In tue synqic; te. an«i thus profit by the alb g* i fe\.rbitant commissions. fhe exact |a: guage of the• «» nplaint in this i orini t m is as fol-low» tt*he ''flmmlMliifiN to f |l Morgin St Co• » •! thr* i . *\i. 1 suit In the pay-ti:rnt of r\ :t«nt u * * ft .n« *ns* onahle rrnfiti* to said fiv a! an t tn^ ^ai iunderwrtttng gyndfcate. mt, »-i the plaintiffIn informed and b* lievej* j i: 1 supm ra tion rtghm of th*- etoi khoid* a.*•* supposed to be of great \aiue and! * H be largely iMl.**' of v f* ni, ‘in: the v:nb*rv\rt-RtlnrWaCiNhvclt;Junlt; 1J bam N a vMlcl Ct 8 tatMiBrraCl:Aprl1ng ai. :b ate uu-. not ip* ulie i oilt;»n totiKf any aubst intl-d air aim t f said t onda, art the com pan v wll r*»peh«' no adequate or vaiuahi# conaidt ration; for said comnna* at nn. «'n lnforrration and belief a number of th* defendant Director* jar* interested in 1 ayndi ute an: «n its* profits and lt;om-miaaltma. A portion of I • it ir interest In eaid profite and * ns results fromCi*!** betteflc at cwnerahtp of eto k* In rnriou* . * »rr lt;-m t i as. » ■ j i in their ownlt; i i • *• »fe ? h •*a or in } • l ■ ' *v - * -age*um or neprreetita11v * «i .* r -id % r*.b**rsto t e wvn lb ate .ak-* « *’ J . * *t \.s p.alntlffI* Informed and beiievA rgit*andland! Mhi. SortS aGuaip«*tYork Th s* ‘d- • tonuntil coedforeii whlcapartI the I | of HThichan,Fran1 mist! ThrforThe(a* thThe WewtNor11iDirir*\gnlnat IHrfrtnm Drolfil.IIt wa.-* rf'v. - st;4t* | lt;fJ'ici.ii’y how much of th- '•*!' i'i• w,i5 »uh-n-ril^lt;i for .it par h It.• stockholdersnf tho Nw ^ ork iVntr.l. It has beenl»ts*ed. however, that t i* *••. rdicsite was flnall r;illo.1 upon to Jd-.-poso of moro than Jto 'XJO.0 of the jbonds. Thep*-r cent commilt;?:i)rJ however, waspaid on all of the boiids except thosetaken hr the Director-i What amount tho Directors took has,not h« en stated.V member of the i' lt;! at-, in dls-CiesinK the suit y stdrd i v. said that the allesrtt ions that Ipi recto's of the New York »Vntv.d '.ad i*r t it# 1 :nri:re. t-A rthe Jjpo«ltiTheporrare ru* ialVnai*i bv the New J?rulv hv tli* c* nm . - ’ r tYnrk Central w#-r^* who|!y without foun- ; (\?r;„datton. Mr Pollitz. h-’isai.J. could have. rtalned the truth If he had desired i n do so\ Idrcctor of the New York * entraJ fdsted veel* rda that the railroad’* re-ph. which must T- nlalt;le within twenty d*\s, would contain a y-ncra! denial of t he HileKHtions in th» complaint. He►aid that it was significant that the suit w»* nf't Ijejrun until nft* r the bonds had been issued. The bonds were dated Mav 1 he point*-! out. whereas he had not heen served with th- complaint untillimitsto 50thr*** da vs after May li. The suit, pendlntf a1sion, will havero effect on the status h-f the debenture honds. A decision in *f i' r of Pollitz.«.t' tvuirse. would affect; their status. It may be a ear or morp t-fore the suitcomes up in the murts.J \s; inwall lfod«-! n; ears in theartion as attorney forjPoutz He was,also th*- attorney In th*| -nrn-year lesal !fijr'.t attain St the Wah.ifh Director*, now Uuj.'Uclodged in the Appellate* Division Court.1 —An rI rook In th*Htld I*Th-School nuaJ • Ir\*tngi May 1A m hie lei at theAn !Tfi hruevrntn St r^et.The lt;Sc hoolan*m m-The not ha
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