The original of tinis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://archive.org/details/cu31924092545486 IN THE CIRCUIT COURT OF THE IITED STATES FOR THE EASTERN DIVISION OF THE EASTERN JUDICIAL 11 UNITED STATES OF AMERICA, petitioner, ■~ V. STANDARD OIL COMPANY OF NEW JERSEY ET AL., DEFENDANTS On behalf of the petitioner: Mr. FEANK B. KELLOGG, Mr. C. B. MORRISON Mr. J. HARWOOD GRAVES On behalf of the defendants: Mr. JOHN G. MILBURN, Mr. MORITZ ROSENTHAL Mr. JOHN S. MILLER, Mr. M. F. ELLIOTT, Mr. MARTIN CAREY, Mr. F. L. CRAWFORD, Mr. DOUGLAS CAMPBELL Volume 1 With List of Witnesses WASHINGTON GOVERNMENT PRINTING OFFICE 1908 HO V.I X LIST OF WITNESSES. Ackert, Charles P . . . Ackert, Cyrus L Ahearn, John , Allen, Charles S Allen, J. F Annett, A. C Archbold, John D... Armstrong, E. C Arnold, Harry C Asche, Frederick D . Barber, George Bartels, Joseph Bayne, Howard Recalled Bedford, Edward T . Benedict, E. C Bensinger, John Benson, Robert D... Boardman, H. C Boltz,F. W Bostwick, J. A Brady, Anthony N . . Recalled Brainerd, Alfred H . Recalled Brewster, Benjamin . Brockway, George P Brown, Thatcher M . Browne, D. E Burrows, John Burtis, C. W Byles, D. E Campbell, John R... Castle, C. J Do Chamberlin, C. Tl ... Chesebro, George . . . Recalled Do Do Do Do Cochrane, Haggert S Cohn, H. J Do Conant, Luther, jr.. Cooke, R. T Cooper, Lewis F Couch, Archie ol. Page. Page of original record. 3 1090 2202 3 1117 2255 4 1970 3951 4 1899 3804 3 1237 2494 3 1340 2696 6 3236 6388 5 2221 4440 2 760 1534 2 858 1738 1 489 997 3 1319 2654 2 786 1588 3 1393 2801 3 1425 2868 1 5 10 1 185 376 1 195 398 5 2163 4329 5 2031 4075 6 3308 6524 1 232 477 2 882 1788 2 688 1387 2 852 1723 6 3306 6519 5 2565 5095 2 835 1688 3 1389 2795 3 1056 2135 3 1396 2808 3 1353 2723 6 3319 6541 3 1391 2799 6 3028 5990 3 1385 2785 1 380 777 1 481 980 2 633 1279 2 877 1777 2 885 1795 3 1398 2813 3 1180 2381 2 901 1828 3 1315 2647 4 1772 3552 5 2501 4970 5 2391 4763 4 1967 3946 IV LIST OF WITNESSES. Cram, W. J Cram, W. J Crandall, Victor H Crawford, Henry J Crawmer, Marion F . . . Crenshaw, P. C Crocker, John T Crossland, G. M Gulp, J.M Recalled Guthbert, Frederick T. Cutler, Walter P Recalled Gy tron, Jacob Darby,G.B Davidson, A. J Davis, W. N Dean, George Z Donald, James Recalled Drake, L. J Recalled Dredger, Christian Recalled Do Do.; Do DriscoU, John Durand, E. D Recalled Do Do Do Do Do Do Do Earl, Charles Ebersole, George R . . . Ells, Z. D Emery, Lewis, jr Farquharson, D. H Farrell, Charles E Fay, Clarence G Recalled Do Fehsenfeld, William H Recalled Finlay, Andrew M Finlayson, H. L Folger, Henry C Frowmeyer, Joseph W Gamerl, Frank Gardner, A. H Garvin, William H Gibbons, Samuel E . . . Gibbs, E. M Grace, W. A Green, Lincoln Recalled Do Griffith, John W Vol. Page. Page ot original record. . 3 . 5 . 3 . 4 . 6 . 3 . 3 . 1 . 4 . 5 . 2 . 2 . 2 . 2 . 5 . 3 . 2 . 4 . 2 . 2 . 2 . 2 . 2 . 2 . 3 . 3 . 3 . 4 . 4 . 4 4 4 5 5 5 5 .■ 6 . 5 . 3 . 3 6 . 5 . 5 1 2 3 5 5 3 5 1 3 6 2 6 4 3 2 5 5 5 3 1349 2419 1131 1952 3108 1170 1345 307 1980 2273 575 845 855 942 2580 1314 952 1890 802 817 746 779 829 837 1397 1405 1479 1910 1515 1694 1771 1783 2026 2075 2090 2429 2880 2081 1323 1374 2609 2203 2432 31 595 1418 2302 2391 1133 2275 283 1324 3137 943 3125 1975 1368 998 2019 2061 2274 1342 2714 4818 2283 3914 6142 2361 2706 630 3974 4539 1167 1708 1729 1909 5125 2644 1929 3787 1620 1652 1506 1573 1676 1692 2811 2827 2977 3827 3048 3400 •3549 3574 4066 4159 4190 4836 5707 4170 2662 2763 5182 4405 4841 64 1204 2854 4595 4762 2288 4544 573 2665 6198 1911 6176 3963 2752 2020 4050 4131 4541 2700 LIST OF WITNESSES. Hampton, Wade Hardcastle, H. C Harraman, J. C Eecalled Harrison, Philip Eecalled Hawkins, W. H Do Hendricks, George U Herdick, Louis R Heyer, William S Hibbs, F. L Hisgen, George C . . . Hisgen, Henry A . . . Recalled Do Hisgen, Thomas L . . Hogan, Thomas J . . . Hopkins, Edward... Hopkins, T. R Hossler, M. M flull,DanielJ Irwin, Lewis Jockel, Anthony V. . . John, D. M Jungling, H. C Justice, Jefferson Kelley, James H Kercher, Charles Recalled King, William R Knapp, I. K Koontz, J. R Kuenster, Gottlieb .. Lane, George L Lederer, Samuel Lee, James W Leland, F. A Lincoln, J. Lines, Charles M Lohman, L. C Lombard, Josiah Longacre, Rudolph. . MacEwen, W. E McNall, R. H Recalled Maher, William J . . . Mahle, Charles H . . . Mandigo, George T. . Maxon, M Mayer, George W . . . Mayer, G. W Merritt, W. S Metzel, W. J Recalled Middleton, J. A Moffett, James A Morgan, AVilliam A , Musser, George W. . . Nichols, C. L Nilan, Michael F Northrup, Frank R. . Vol. Page. Page ol original record. 1 267 551 3 1063 2150 5 2023 4058 5 2091 4192 2 491 1001 2 763 1540 2 985 1994 3 1242 2503 2 916 1857 4 1923 3855 3 1165 2350 3 1328 2673 4 1937 3884 4 1919 3845 4 1946 3903 4 1977 3968 4 1795 3597 4 1929 3866 6 3325 6553 3 1027 2076 6 2941 5825 3 1372 2761 6 3009 5954 3 1061 2146 3 1040 2102 2 928 1881 3 1487 2993 4 1905 3816 6 2802 5556 6 2949 5841 3 1500 3019 3 1232 2483 3 1249 2517 o 995 2015 3 1356 2728 3 1044 2112 6 3150 6225 3 1190 2400 3 1253 2526 6 3201 6324 2 932 1888 1 243 500 3 1376 2768 3 1369 2754 2 662 1335 2 807 1630 4 1972 3956 5 2347 4680 4 1963 3936 3 1285 2589 3 1175 2371 3 1239 2497 3 1347 2711 5 2405 4791 5 2429 4835 3 1252 2523 3 1139 2298 3 1003 2032 2 968 1961 3 1158 2336 4 1921 3849 3 1046 2117 CORNELL UNIVERSITY LIBRARY VI LIST OF WITNESSES. O'Day, Daniel Payne, Calvin N Phipps, Bruce Pierce, H. Clay Pool, Frank J Pratt, CM Recalled Pratt, Edward P Eeighard, David P Eipley,E.P Robertson, A. F Rockefeller, William G Recalled Roessler, Paul Rogers, Henry H Schindler, T. C. M Recalled Do Do Seabrook, J. P Shea, John James Shiers, A. G Squire, F. B Steigerwald, G. J Steinbrenner, C. C Recalled Do Stewart, W. R Stocke, A. L Tarbell, William' Walter .... Recalled Teagle, Walter C Teagle, Walter C Recalled Tilford, Henry M Recalled Do Tilford, Wesley H Recalled Do Todd, W. D Trainer, P. S Recalled Turrell, Louis H Vahey, W. H Von Harten, Edward N Von Harten, Edward N Wallace, James N Warren, Benjamin Franklin Webster, C. D Weinberger, Isaac Weetcott, Hampton G Recalled Westgate, T. B Recalled Whelan, Henry D White, Charles T Recalled Wilhoit, E. M Wilhoit, E. M Recalled Vol. Page. Page ol original record. 6 3287 6487 1 311 637 2 996 2017 3 1065 2154 5 2063 4135 1 13 27 1 71 146 2 958 1941 6 3131 6186 3 1283 2585 3 1182 2385 2 865 1753 3 1421 2861 3 1247 2513 6 3293 6500 4 1660 3333 4 1694 3401 4 1778 3564 5 2082 4173 4 2005 4023 5 2459 4891 2 978 1981 6 3124 6172 3 1041 2105 1 412 841 2 864 1751 3 1468 2955 2 993 2011 2 891 1807 2 921 1866 1 463 944 3 1429 2877 3 1147 2314 3 1428 2875 3 1467 2953 2 679 1369 2 729 1469 3 1465 2948 1 95 194 1 468 934 2 622 1257 6 3207 6337 2 646 1303 3 1425 2869 3 1050 2124 3 1366 2747 2 926 1876 3 1126 2273 o 833 1684 1 189 385 3 1206 2431 2 999 2024 2 704 1420 2 781 1577 6 2840 5627 6 2883 5712 2 972 1969 1 400 817 2 621 1255 3 1031 2084 3 1211 2442 3 1241 2501 LIST OF WITNESSES. VII Vol. Page. Page of original record. Wilhoit, E. M 3 2 5 4 5 5 1255 938 2534 1932 2149 2094 2530 WUlis, J. S 1899 Willock, Harry H 5035 Winnie, Wellington 3872 Wofford, G. T 4303 Wootten, E. N 4198 In the Circuit Court of the United States for the Eastern Division of the Eastern Judicial District of Missouri. United States of America, petitionee, versus Standard Oil Compant of New Jersey, et al, defendants. Pursuant to the order of Honorable Franklin Ferriss, the Special Examiner in the above entitled cause, dated St. Louis, Missouri, August 7, 1907, the parties appeared by counsel before the said Special Examiner in Room 43 of the General Post Office Building, Borough of Manhattan, City of New York, State of New York, on Tuesday, the 3rd day of September, 1907, at 10 o'clock A. M. The following appearances were entered : On behalf of the Petitioner :Mr. Frank B. Kellogg, Mr. C. B. Morrison, Mr. J. Harwood Graves. On behalf of certain defendants : Mr. John G. Milburn, Mr. M. F. Elliott. On behalf of The Manhattan Oil Company : Mr. W. L. Mackenzie ; On behalf of The Security Oil Company : Mr. George C. Greer ; On behalf of Corsicana Eefining Company : Mr. W. J. McKie. 2 Eobert S. Taylor, Official Shorthand Reporter. The Examiner. Are you ready to proceed, gentlemen? Mr. MiLBUEN. If your Honor please, for reasons which I have ex- plained to counsel for the government, I would like to have this mat- ter continued until Thursday morning, which, I think, will not meet with any opposition from them. Mr. Kellogg. No, we will not oppose an adjournment until Thurs- day morning. I would like to have the appearances entered, and there may be some witnesses here of whom I should like to inquire whether it would inconvenience them. The Examinee. I assume, gentlemen, in laying the case over until Thursday morning, the purpose is to make an ultimate gain in time. Mr. MiLBUEN. Yes. Mr. KELLOGCi. That is the object, to see if we can save time by it. (The appearances were then entered as shown on the foregoing page.) Mr. Kellogg. I would like to inquire if Mr. E. C. Benedict is in the room? (No response.) Or Mr. R. W. Downing? ( Someone announced that Mr. Downing would be present in a few moments, and shortly afterwards he appeared.) 32555—08 1 1 2 UNITED STATES VS. STANDARD OIL COMPANY. Mr. Kellogg. Mr. Downing, Mr. Jefferson Justice and Mr. Mc- CuUoch have no objection to the adjournment. If the Ex- 3 aminer thinks proper, an order might be entered that, unless excused, all witnesses subpoenaed appear here Thursday morning. The Examiner. That will be the order. Mr. Kellogg. At 10 o'clock. Mr. MiLBURN. Say half past ten. The Examiner. The order will be made that the hearing stand ad- journed until next Thursday at 10:30, and that all witnesses sum- moned for this morning return at that time without further notice. Mr. Kellogg. Very well. The Examiner. Are there any further directions in regard to wit- nesses ? Mr. Kellogg. No, I think not. I think that is all the order that is necessary. The Examiner. I received a doctor's certificate to the effect that one witness was sick. I assume he was a witness. Do you desire any information in regard to that? Mr. Kellogg. I am perfectly willing that matter should stand, and that he may be notified to appear at his earliest convenience, when he is able to appear. The Examiner. Do you desire any witnesses called? Mr. Kellogg. Just a moment. The Examiner. I desire to announce to counsel present that Mr. Eobert S. Taylor has been appointed by the Court official 4 stenographer in this case, and is here by virtue of that ap- pointment, and not by virtue of having been selected by either side or by consent, but by appointment, of the Court. The order of appointment is in the city, but I do not have it with me at the present moment. Mr. Kellogg. I think there is nothing further. The Examinee. My understanding, then, is that you will be ready to proceed on Thursday next ? Mr. Kellogg. Unless some further proceeding is taken we will. The Examinee. Is that right ? Mr. Kellogg. Yes. The Examinee. I say my understanding is that you will be ready to proceed on Thursday next ? Mr. MiLBTXEN. Yes. Mr. Kellogg. As far as we are concerned. The Examiner. The hearing will stand adjourned until that time. At 10.30 a. m. an adjournment was taken until the morning of Thursday, September 5, 1907, at 10.30. 6 KooM 43 General Post Office Building, New York, Septemher 5, 1907, 10:30 a. m. At the above time and place, the parties by their counsel appeared before Honorable Franklin Ferriss, the Special Examiner, pursuant UNITED STATES VS. STANDAKD OIL COMPANY. 3 The following additional appearances were endered on behalf of defendants: Mr. John S. Miller, Mr. H. S. Priest, Mr. Moritz Rosen- thal, Mr. W. I. Lewis, representing Tide Water Pipe Company, Limited, Tide Water Oil Company, and Piatt & Washburn Refining Company. The Examiner. On Tuesday last the hearing was adjourned by consent until this morning. Are you now ready to proceed ? Mr. MiLBUEN. If your Honor please, the Government has served in this case certain subpoenas duces tecum, calling for a great many books, for the purpose of obtaining information as to a great many different matters connected with the business and operations of the defendants during a period of years. Those subpoenaes have been supplemented by requests, practically in the nature of additions to the subpoena^, for books and information as to other matters. We have had under consideration that situation, with reference to expe- diting the hearing before your Honor. We have proposed to the counsel for the Government, and do propose, to have prepared, 6 in obedience to those subpoenas, statements covering all the subjects embraced in the subpoenas and the additions in so far as there is material in the books and papers we have and that are mentioned in the subpoenas. We have proposed that with a view to shortening this hearing. And that it will shorten it is very clear and very obvious to all of us. Those statements as the}^ are pre- pared will be furnished to the counsel for the government, who have, of course, reserved to themselves the opportunity of verification. We have discussed the matter from that point of view with the counsel for the government, and ask now that this matter be ad- journed until the 17th of this month, by which time it is expected that those statements, covering a very large group of subjects of im- portance in this case, will be ready, and will have been, so far as possible, submitted to them prior to that time, so that the trial can then proceed intelligently and with much more expedition than if we were to go ahead now without those statements. I would assure you that if all that mass of books had to be produced and all that information obtained without its formulation and presentation in such statements as I have mentioned, a very considerable amount of time would be consumed, and really would be wasted. Therefore I ask Your Honor to enter an order continuing this case until the 17th day of this month. Mr. Kellogg. May it please your Honor, I am assured by the counsel for the defendants that they have not had time, up to the present time, to get together the information which 7 we have asked in these subpoenas, and I believe tliat to be true, although they have had the subpoenas some little time. Now, I wish it distinctly understood, of course, that we do not waive the production of any book or document, if we should desire to have the original on the examination. I understand that to be the agreement? 4 UNITED STATES VS. STANDARD OIL COMPANY. Mr. MiLBURN. Yes. Mr. Kellogg. And we are to have ample opportunity to verify the statements. Of course it will very much expedite the hearing if those statements can be prepared and be ready when we are ready to go on with this case; and after frequent consultations we have come to the conclusion that it would expedite the hearing if the informa- tion demanded from the books of the Standard Oil Companies could be got in shape so we could have it prior to the I7th of September, and be enabled to put it in with more rapidity than we could do if we got it from the books in court. Of course I want it understood that on the 17th we shall go ahead, and that the witnesses who have been subpoenaed from the Standard Oil Company will be here, so far as they are in the court room, — there are some few men, I believe, who are abroad on their vacations, — but those witnesses that are here today will be here and be ready for the hearing on the I7th, as I do not wish another delay, and the counsel is agreed with me on that state of facts. With that understanding we are willing that the order be entered that all witnesses subpoenaed be required to 8 be present on the I7th and that the matter be adjourned until 10 o'clock on the morning of the I7th; I would prefer 10 o'clock to 10 :30. The Examiner. May I ask whether the present course contem- plates giving you an opportunity to examine these statements before the I7th? What I mean is this: I do not wish to come here and attempt to hold a session on the I7th and then be confronted with the statement that the Government has not had an opportunity to examine these statements and request a further adjournment for that purpose. Mr. Kellogg. We shall be ready to go on on the I7th. We are ready now, and we expect statements enough furnished to us before that time so that we can go on on the 17th. You understand, Mr. Milburn, that the statements will be furnished before that time? Mr. Milburn. Yes. I have said to Mr. Kellogg we will furnish these statements as rapidly as we can, just to meet the very con- tingency that your Honor suggests. The Examinee. An examination of the pleadings discloses the fact that the testimony will cover a long period of time and a great variety of subjects, and I assume it consists very largely of records and figures which are to be obtained from books. If the course which ha.s been suggested is followed we will not experience the difficulty of getting a mass of books into court and bringing out the testimony in that way. And while it is somewhat of a disappoint- ment to come here and not proceed, yet I feel if this arrange- 9 ment is carried out in the spirit which is here expressed, it will result in a saving of time on both sides. As far as the position of the Examiner is concerned, it may be assumed, I think, that the court will desire the testimony to i^roceed in this case as rapidly as possible, having due regard to the rights of all parties. The pleadings cover a great deal of ground, and the Examiner is BENEDICT. 5 obliged to come from a distance, and it would be extremely incon- venient to have sessions and have them result simply in adjourn- ments. It seems to be agreed by both sides that the granting of this application will result in the saving of time. I think it is obvious to any lawyer of experience that such would be the case, and I cannot but feel that we will make a substantial gain by taking this adjournment. So the order will be that all witnesses will be discharged until the 17th day of September. I will fix the hour for that first meeting at 10:30 A. M., and we can arrange then as to the hour of subsequent meetings. And they will return here at that time without further notice, all present subpoenas being continued in full force. Mr. Kellogg. We will be ready on the morning of the l7th. (Adjourned until September 17, 1907, at 10:30.) 10 Benedict. New York City, September 17, 1907. The hearing was resumed pursuant to the adjournment, at 10:30 A.M. E. C. Benedict, called as a witness on behalf of Petitioner, being duly sworn, testified as follows: Direct-examination by Mr. Kellogg: Q. Your name is E. C. Benedict, is it? — ^A. Yes sir. Q. Where do you reside? — A. Greenwich, Connecticut. Q. Did you ever own or have any interest in the Manhattan Oil Company? — A. Yes sir. Q. Who owned that company with you?— A. The most conspic- uous holder besides myself was Anthony M. Brady. Q. You and Mr. Brady owned nearly all the stock of the Manhat- tan Oil Company? — A. Perhaps there-fourths of it, together. Q. Do you know who owned the rest?— A. Well, they were small amounts, and mostly Mr. Brady's friends, I think. Q. Mostly what ?— A. Mostly Mr. Brady's friends, I think. Q. Where was the Manhattan Oil Company's business situated?— A. Well, it was near Lima, I think, if not at Lima. Q. It was a pipe line company, was it not?— A. It had some pipes connected with wells, as I remember it. Q. It also owned a refinery, did it not? — A. It did. Q. At Gallatea, Ohio?— A. I don't think that is the name, but it may have changed names. 11 Q. Welker?— A. Somewhere near that, yes sir. Q. It also owned some producing wells, did it not?— A. "Y"gs sir. Q. The pipes of the Manhattan Oil Company reached what was known as the north and south Lima fields, did they not?— A. That is my recollection, sir. I never visited the place but once, and my ideas of the geography and other details are not very good. 6 BENEDICT. Mr. MiLBCEN. Mr. Kellogg will supply any defects in your infor- mation by his questions. Q. Mr. Benedict, do you remember the amount of stock of the Man- hattan Oil Company? — A. I do not. Q. You sold that stock, did you ? — A. I sold what I owned. Q. When? — (Witness refers to memorandum.) October 24, 1898, I sold 5,17-5 shares of Manhattan Oil, at par, to a party that was said to reside in England, a manufacturing concern, but whose name I forget. I was told tliat if I would take such a price I could deliver it at the Central Trust Company, which I did. Q. You delivered the stock to the Central Trust Company of New York? — A. Yes sir. Q. Were those shares One hundred dollar shares? — A. I think they were, sir. Q. That would be how much you received for that? — A. Well, it would be $517,500. Q. Do you know who the purchaser was? — A. I did, but I 12 have no recollection of the name. Q,. How come you to sell it? — A. Well, whoever the party was (a foreign corporation) applied to Mr. Brady to know Mr. Rosenthal. Isnt this manifestly hearsay ? Mr. Kellogg. Do you object to it? Mr. RosBUTHAL. I object to it as hearsay. Q. Go ahead with your answer, please. — A. Mr. Brady informed me that there was a foreign corporation learned that we had a prop- erty which they thought they would like to buy. Mr. MiLBXJRN. I would like to enter on the records here an objec- tion to what Mr. Brady told Mr. Benedict as hearsay. Mr. Kellogg. I will connect it up with Mr. Brady and these de- fendants. If I do not it will not be evidence. Q. You will proceed with your answer. — A. I objected to his hav- ing any negotiations with this party unless they gave a reference, and they did refer to Brown Brothers & Company, as he told me. I didnt have anything whatever to do with it primarily, and Mr. Brady brought back the word that they were in every way reliable, worthy of confidence, responsible. They proceeded to examine the property and finally made an ofi'er to the stockholders generally, I believe, and I availed of it. Q. Did you sell any bonds at the same time ? — ^A. I did. Q. How many? — A. I find that I delivered to Mr. Elf red Heyn 286,000 Manhattan Oil Company bonds, at par and interest, 13 and he took them to Brown Brothers & Co. and got a check. Q. 286,000 and interest? — A. Yes, sir. I also delivered to Mr. Heyn 753 shares of Oil Creek stock at 114, plus a fraction, to Brown Bros, and got a check. Q. What was the Oil Creek Company ? — A. I think it was owned by the Manhattan, if I recall right ; I think so, I am not sure. I have no records of the Manhattan Oil Company, and I have only to take the little memoranda from my books. BENEDICT. 7 Q. Was it a producing company ? — A. Oh, sure. Q. The Oil Creek Company ? — A. I think so, yes. Q. You think so?— A. Yes sir, I think that and the Manhattan both. Q. That made in round figures $889,342, did it not?— A. If I have made no mistake ; $286,000. There would be interest. Q. Well, I am not figuring the interest.— A. Well, I have given you the round figures. Q. Well, it would be about that?— A. Yes, that would be substan- tially it, as shown by my books. Q. Now, did you see any representative of this foreign company ?— A. Never. Q. Do you know the name of the foreign company ? — A. I do not. Q. Did you at the time ? — A. Quite likely. Q. You have no recollection of it ? — A. No sir. Q. What year was this?— A. 1898. October 24th was the 14 day I made the first delivery. Q. Did you ever see any representative of this foreign com- pany? — A. Never. Q. You dealt simply with the Central Trust Company and with Brown Brothers, did you? — A. That is all. Q. Did they disclose the name of their principal ? — A. Not to me. Q. Did you have any negotiations with any officer or official of the Standard Oil Company of New Jersey ? — A. No, not in the slight- est degree. Q. Did you ever have any negotiations with the officers of any of the companies connected with the Standard Oil Company of New Jersey? — A. Never. Q. Did you at the time know whether Mr. Brady had any such negotiations ? — A. No, I do not know. He never intimated. In fact he intimated that the Standard Oil Company had absolutely nothing whatever to do with this transaction. He repeated that to me time and again. Q. Why did you ask him about that? — A. Because I suspected they might. Q. Did you object to their having it? — A. It never got so far as that (laughing). Q. Well, why did you want to know ? Mr. MrLBURN. I object to this if your Honor please. It is imma- terial. It is speculation on the part of the witness. Mr. Kellogg. Well, we will see. Please repeat the question 15 to the witness. Question read. Q. Well, naturally, it would be a matter of curiosity. Q. Merely as a matter of curiosity ? — A. That is all. Q. Did the Standard Oil Co., or any officer of the Standard Oil Company ever offer to buy the property? — A. No, sir. On the con- trary, the only rumor I ever heard was that the Standard Oil Com- pany at all times said "There is that Manhattan Oil Company; we BENEDICT. had better let them sizzel," or something of that kind. " Have nothing to do with it." That is the only kind of a rumor or report that I got. Q. Why did you wish to know the financial standing of the parties buying the Manhattan Oil, if you got your pay in cash ? — A. Common prudence dictates that in any negotiation when strangers come in and ask for your property. Q. That was the only reason, was it? — A. That was the only reason. I did not want to have any time wasted or exposures made to trifling people. Q. Were you engaged in any business connected with the oil busi- ness? — A. No, sir. Q. In the gas business ? — A. Oh, in that way, sure. Q. Did you or did you not use this Manhattan Company in con- nection with your gas business? — A. That was the object of getting up the oil company, — was to protect the gas companies from 16 experiencing high prices ; have a regular price, dictated by the price in the field. That was my scheme when I got it up. Q. Did you wish to know anything about the purchasers in con- nection with that? — A. I do not recall that I did. Q. Did you have any arrangement- with them to protect you? — A. No further than to see that they carried out the contracts between the Oil Company or companies and the gas companies, which were somewhat under my control. Q. Were those contracts in writing? — A. Oh, yes. Q. Did you get the guaranty of the purchasers to carry them out? — A. The contracts must have been. Q. Did you get the guaranty of the purchasers to carrj^ out those contracts? — A. Their attention was called to it and on the faith of what Brown Brothers said to me or to Mr. Brady, as I understood, they said all contracts would be respected. Q. Did vou call their attention to it ? — A. I did not, but Mr. Brady did. Q. Where is Mr. Bradv now ? — A. I am told that he is in Europe still. Q. Did you object to any one, at that time, in the course of these negotiations, to the Standard Oil Company getting possession of the Manhattan Oil Company ? — A. I did not. Q. You never did? — A. No. Q. You never raised any objection? — A. No; I had no opportunity to object. 17 Q. Why did you ask if the Standard Oil Company was the purchaser? — A. As I said before, mere matter of curiosity. Q. Mere matter of curiosity ? — A. Yes, sir. Q. What contracts did you have with the Manhattan which you wished the purchasers to i-espect? — A. Contracts with the Chicago Gas Company, with the Equitable Gas Company of New York, and the Indianapolis Gas Company of Indianapolis were there, and there BENEDICT. 9 may have been two or three others that I do not recall, small gas com- panies ? Q. How long did those contracts run ? — A. Three years, is my rec- ollection. Q. What ?— A. Three years from the time I sold out, I think. Q. Did you ever renew them? — A. I was out of the job before they terminated. Q. You were out of the gas company? — A. No, out of the Man- hattan. Q. Yes, but were they renewed with the Manhattan?— A. I dont know the first thing of the Manhattan from the day I got my checks. Q. Never had anything to do with it since? — A. Never. Q. Do you know whether the Manhattan sold its refinery? — A. I have no knowledge whatever ; never paid any attention. Q. Did you ever hear that it sold its refinery to Solar Eefinery, one of the Standard Oil companies? — A. I dont recollect ever hear- ing it. 18 Q. Do you know whether it sold its wells, produci^ig com- panies? — A. I comprise the answer to all those in my state- ment that I never took any interest and never put anything in my memory that might have taken place in the Manhattan Oil Company or Oil Creek from the time I got my check. Q. Your interest ceased in it at that time? — A. Absolutely. Q. Except as to carrying out these contracts ? — A. That is all. Q. Are j^ou still connected with those gas companies? — A. In In- dianapolis, yes sir. Q. Can you produce those contracts? — A. Well, I think I could if they were wanted, in one case ; I think perhaps I could hunt them up in the case of the Indianapolis company; but they expired, you see, seven or eight years ago, and you know what becomes of old papers. Q. You say they never were renewed after the three years ex- pired? — A. No sir. Q. You had no assurance personally from the purchasers that those contracts would be respected ? — A. Never had any dealings personally with the parties who paid me for my property, for my stocks and bonds. Q. With what companies did the Manhattan Oil Company com- pete at the time you were engaged in the business? — A. Well, there were several independent companies, as I recollect it, 19 whose names I do not now recall. Q. The Standard Oil Company?— A. Oh, sure. Q. The Buckeye Pipe Line Company ? — A. Well, those little items were all left to Mr. Heym. Q. Mr. Heym is dead, isnt he? — Oh, yes, five or six years ago. And I trusted to him ; did not charge my memory, Mr. Kellogg, with those things. Q. Well, now, was that English Company, the General Industrial Development Company, Limited, of London ? — A. Some such a name as that; I wouldnt swear. 10 BENEDICT. Q. Had you ever heard of it before? — A. Never. Q. You did not inquire into his business? — A. No further than I have stated. Q. With what member of the firm of Brown Brothers did you do business? — A. I did business with no one; I never went to Brown Brothers at all and saw any of them. Q. Did you ever have any conversation with Mr. H. H. Eogers ? — A. Never. Q. Are you a relative of Mr. Rogers? — A. Well, a connection. Q. In what way? — A. Well, he married my wife's sister-in-law. Mr. MiLBUEN. Your what? Mr. Rosenthal. Wife's sister-in-law ! Q. And you never had any conversation with him about it? — A. Not a word. 20 Q. Did you ever have any conversation with Mr. Flagler? — A. Never. Q. Or any other Standard Oil official? — A. About this matter? Q. Yes. — A. I dont know but Mr. Flagler may jokingly have said something about the Manhattan Oil Company, but I dont recollect anything but that. Q. When was this joking conversation, — prior to the sale, or after- wards ? Mr. Rosenthal. I submit the witness has not said that. Witness. I think it may have been before that. Q. Before that ? — A. Yes, it may have been ; nothing to amount to anything. Q. Nothing important? — A. No sir. Q. Is Mr. Flagler a relation by marriage of any of your family ? — A. My sou married his daughter. Q. You never had any conversation except in a casual way? — A. I am not quite sure of that even, but I think at one time he joked me about my being in the oil business, or something. I was very intimate with him, and that is the most he ever said. I never opened the subject with him. Q. Did you go into the oil business to protect your gas com- panies? — A. That was the main object, yes sir. Q. Did you go out of it because you had ceased to need the pro- tection ? — A. Yes, in the way that I speak cf , that the contract was for three years, is my recollection. 21 Q. Well, the gas companies would last lon<;er than three years, would they not? — A. Yes, but I was not sure of my con- nection with any, any more than they could look out for themselves. Q. So you sold out ? — A. Yes, except in Indianapolis. Q. Sir ? — A. Except in Indianapolis. Q. Very well, you are still connected with that company? — A. Yes sir. Q. Did it cease to need protection ? — A. It has got along first rate without it. BENEDICT. 11 Q. Where does it get its gas oil?— A. I think mostly from the Standard. Q. Entirely, does it not?— A. I think almost entirely, yes sir. Q. Did you have an arrangement with the Standard after you sold out to furnish gas oil for that company ? — A. Never. Took the mar- ket and made the trade like anybody else. Q. But the Standard furnished the gas oil for your company? — A. Yes sir, and in a most acceptable way, too. Q. And most all of your companies ? — A. Well, I havent any par- ticular interest in the others. Q. Well, the other companies while you were connected with them ? — A. I went out before the contracts ceased. Q. Yes, but after the Standard furnished the gas oil, did it not ?— A. I couldnt swear to that; I dont know. I have no knowledge. Q. But it does in the Indianapolis? — A. Sure. 22 Q. At the time you sold out, did you have any assurance from the Standard that they would furnish you? — A. Not a particle. Q. None whatever ? — A. None whatever until the contract ran out. Q. You got $889,342 for your stock and bonds, without knowing only in a general way who the purchaser was? — A. Absolutely. Q. And yet you had gone into this business, this great investment, to protect your gas company? — A. Yes sir. Q. And you got no assurance beyond the contracts that you had before you sold that the gas companies would be protected? — A, None whatever. Q. And you never talked with any official of the Standard Oil Company about the sale, unless it was with Mr. Flagler ? — A. Never. Q. And you never heard that the Standard Oil Company bought it? — A. No sir, never. Q. And you don't know what this Industrial Witness. Excuse me, Mr. Kellogg. Q. Yes. — A. I saw in the paper — something like the resurrection of a dead name — that the Manhattan Oil Company was owned by the Standard Oil Company, or it was so charged in some court pro- ceedings, and I spoke to my partner about it, and that is the only way I ever heard anything about their ownership or claimed owner- ship : that is, hj the government, in their proceedings. 23 Which member of the firm of Brown Bros, did you deal with? — A. I had no dealings with any one; I never saw one of the members of the firm. I was told by Mr. Brady to send my stuff down there and get a check, and I got it. That is all I did. Q. And you had no dealings with any member or officer of the Central Trust Company?— A. Never; the same way. Q. Just told to send your stock down and get your check?— A. Yes, and get the check. Q. And that is all you did ?— A. That is all I did. Q. Were the officers of the Manhattan Company immediately changed ? — A. I never knew. 12 BENEDICT. Q. You know nothing about it? — A. No sir, absolutely. Q. Who assured you of the responsibility and standing of these purchasers? — A. Brown Bros., through Brady. Q. What did Mr. Brady say to you about it ? Mr. EosENTHAL. Well, there is the same objection there as hereto- fore urged. Mr. MiLBURX. And also that he had already testified to what Mr. Brady said. A. I think I answered you, Mr. Kellogg, as fully as I could : that they were entirely responsible. I was very careful about that, be- cause we did not care to have our property investigated by triflers. Q. Who did investigate it? — A. They sent some party that they saicl was familiar with the business, the business of oil produc- ing, conveying, etc., and a man I never knew, and he took 24 quite a long time, perhaps a month (I dont know but longer) in going all over the properties, counting the cars, and looking into the books, and I dont know but what he had somebody with him ; quite likely. Q. Did you ever see the man? — A. Never. Q. Dont know his name? — A. I dont recall his name. I heard it at the time, but I didnt treasure it up. Q. Working for one of the Standard Oil Companies, was he? — A. Well, Mr. Heym, who is dead, said that he suspected that it was a discharged employe of the Standard Oil Company. Mr. MiLBUEN. Just a moment, please. Q. That is all Mr. Heym said about it ? — A. That is all I recollect, yes sir. Mr. MiLBUEN. I want my objection noted to that question, that it is not only hearsay, but the statement of a deceased man. Witness. Well, I made no concealment of his death. Q. Did you not say to Mr. Brady at that time that you would object to selling it out to the Standard Oil Companj'? Mr. MiLBURN. I object to what Mr. Benedict said to Mr. Brady. A. I do not recall that. Mr. Rosenthal. Give us a chance to get our objections on the record before you make your answer. Witness. All right, sir. Q. Did you say anything to Mr. Brady at that time about 25 objecting to the Standard Oil Company buying it? — A. I dont recollect it, Mr. Kellogg. Mr. MiLBtiKN. I object The Examinee. Mr. Witness, when the counsel on the other side is seeking to object, wait a moment until they get through. Mr. MiLBUEN. On the groimd that his statements to Mr. Brady are not admissible or relevant. Witness. Your Honor, I said I would tell the whole thing. I try to stick to a promise. Q. Did you organize the Manhattan Oil Company ? — A. I think I was one of the organizers. PRATT. 13 Q. Mr. Brady another?— A. I think so. Q. Constructed its pipe lines?— A. Furnished most of the money. Q. Built the plant, the refinery ? — A. Yes sir. Q. And acquired the producing wells ? — A. Yes sir. Q. Do you remember about what year that was?— A. Well, it was in our hands, I should think, about five years ; about five years before we sold out. It may have been a little longer. Q. And that was done, was it, to protect your gas companies? — ^A. I repeat it was. Q. If you will try and find those contracts and produce them, Mr, Benedict, for inspection.— A. I will make a memorandum to do so, sir. You understand, Mr. Kellogg, that I can only have access to the Indianapolis company. Q. Were you an officer of the Manhattan Oil Company? — 26 A. I hate to dixulge my ignorance, but I cannot recall whether I was or not. Q. You dont remember? — A. I dont remember. Mr. Kellogg. That is all, sir. Mr. MiLBUEN. No cross-examination. The signature of the witness to his testimony is waived by the respective parties. 27 C. M. Phatt, called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct-examination by Mr. Kellogg : Q. Give your name and your residence, Mr. Pratt. — A. Charles M, Pratt, 241 Clinton Avenue, Brooklyn. Q. Are you an officer of the Standard Oil Company, of New Jer- sey? — A. I am. Q. How long have you been ? — A. Since 1899. Q. Since about what time in 1899 ? — A. Mid-summer. Q. Were you connected with the Standard Oil Trust, prior to that time? — A. I was not. I was a Liquidating Trustee, if you mean that Q. Yes. — A. For a very brief time. Q. You were a Liquidating Trustee from what time? — A. For a few months, as I recollect it, before 1899. Q. For a few months. Prior to that time were you connected in any way with the Standard Oil business? — A. I was an employe simply. Q. In what capacity? — A. Well, I suppose salesman or general local manager. Q. Did you sign the trust agreement of 1882? — A. Yes, I had a few shares and signed that agreement. Q. I show you copy of trust aj.^reement, which is admitted 28 to be a copy. You signed that trust agreement as C. M. Pratt, did you? — A. That is correct, sir. Q. As secretary of the Standard Oil Company, of New Jersey, what are your duties? — A. My official duties are the care of the minute-book and the stock-books and the stock register. 14 PBATT. Q. Do you also have charge of the accounting departments ? — A. I do not. Q. Do you have anything to do with them? — A. I do not. Mr. KosENTHAL. We will agree that Mr. Fay, if called, will testify that is correct. Q. Mr. Pratt, I show you a list of securities owned and held by the Standard Oil Company, of New Jersey, September 14, 1907, fur- nished pursuant to the subpoena duces tecum served upon you and marked Petitioner's Exhibit 1. Are you familiar with that? — A. I am not, sir, in detail. Q. Did you have it made up ? — A. I did not. Q. Who did? — A. It came from the accounting department; I suppose Mr. Fay, as far as I know. Q. Who has charge of the accounting department? — A. Mr. Brainerd, or, in his absence, Mr. Fay. Q. Mr. A. H. Brainerd ? — A. Yes sir. Q. What is Mr. Fay's name? — A. I dont know his given name; I think it is Henry, but I ant not sure. Q. What is Mr. Brainerd's position? — A. Mr. Brainerd is the comptroller of the company. 29 Q. Have you examined that statement? — A. Not in any careful way, no sir. Q. You dont know whether it is correct or not ? — A. I do not. Q. You have never had anything to do with the comptroller's department? — A. I have not. Q. Or the accounting departments of the Standard Oil Company or any of its companies ? — A. I have not. Mr. MiLBURN. Mr. Kellogg, if you want to use that statement, you can take it as correct and Mr. Fay can testify to it later. Mr. Kellogg. I want to ask some questions about it. Q. You have been connected, then, with this business for twenty years? — A. Yes, as an employe. I began as a clerk, and I have been there twenty years. Q. How long has Mr. Brainerd been the comptroller? — A. I could not answer definitely; I dont know. Q. You dont know; can you tell about how long? — A. I really could not. I should say a few years. Q. Well, who preceded him? — A. I think it was Mr. Clark, but I am not sure, Mr. Kellogg. Q. Where is Mr. Clark? — A. I dont know. Q. Is he still with the company? — A. He is not. Q. Do you know who preceded Mr. Clark? — A. I do not, sir. Q. The comptroller has charge of all books showing the 30 properties of the Standard Oil Company of New Jersey, has he? — A. Well, that is my general impression about it, yes sir. Q. What is Mr. Wade Hampton's business? — A. Mr. Wade Hamp- ton is the auditor, the general auditor. Q. What are his duties ? — A. Simply to see that the books are cor- rectly kept or checked ; see that the results are as indicated. PEATT. 15 Q. The books of the Standard Oil Company of New Jersey?— A. Yes, I presume so. Q. And of all companies in which the Standard Oil Company of New Jersey owns stock?— A. I could not answer, Mr. Kellogg. Q. You dont know as to that ? — A. I dont know. Q. As secretary of the Standard Oil Company, do you know any- thing about its acquisition of properties or stocks in other com- panies? — A. Not necessarily, no. Q. Well, did you ever hear of the Manhattan Oil Company ?— A. That has been in business a good many years. Q. Do you know of the company? — A. Only in a general way as being in business. Q. You know of the company, do you ? — A. Yes. Q. And have known of it for years ? — A. Yes. Q. Do you know the Solar Refining Company ? — A. I know that concern by name. Q. Is that one of the companies in which the Standard Oil Com- pany owns stock ? — A. I think it is. 31 Q. What amount of stock does the Standard Oil Company own in it ? — A. I do not know, but I presume a majority of it. Mr. MiLBTJHN. Is it in that paper ? Mr. Keulogg. Yes. Mr. Rosenthal. According to that statement, Mr. Pratt. Witness. Do you want the number of shares, Mr. Kellogg? Mr. Kellogg. Yes sir. Witness. 4,994, and a very large or small fraction of a share. Q. What is the capital of that company? — A. Well, I suppose it is $500,000, but I dont know, sir, from this statement. Q. That is your understanding, is it? Mr. Rosenthal. Does the total capitalization appear on that state- ment, Mr. Pratt? Witness. It does not, sir. If they are $100 shares, that would make $500,000. Q. Have you books showing the total capitalization of all of the companies in which the Standard Oil Company owns stock? — A. I know nothing of any such books. Q. You know nothing of them. Where does the Solar Refining Company do business ? — A. I believe it does business in the State of Ohio. Q. Did it purchase the refineries of the Manhattan Oil Com- pany? — A. I dont know, sir. Q. You know nothing about it whatever? — A. Nothing about it. 32 Q. Do you know the Ohio Oil Company ? — A. I know it by name, yes sir. Q. Is that one of the companies controlled by the Standard Oil Company ? — A. Yes sir, it is. Q. The Ohio Oil Company, you say, is a corporation controlled by the Standard ? — A. Yes sir. 16 PBATT. Q. Do you know whether it purchased the refineries of the Man- hattan Oil Company? — A. I dent know. Q. Know nothing about it ? — A. No sir. Q. Never heard anything about it ? — A. No sir. Q. Never had anything to do with the business of the Ohio Oil Company?— A. Never. Q. Who are its officials? — A. I cannot answer certainly, Mr. Kel- logg, who they are. That information can be had, but I dont recall. Q. Do you have in your office, or do you know where can be pro- cured the list of officers of the companies in which the Standard Oil Company of New Jersey owns stock ? — A. I think such a list is kept, yes sir. Q. Will you have a statement made up showing the officers and directors of the Standard Oil Company of New Jersey, and of each company in which it owns stock during the year 1899 to the present time? Mr. MiLBUEN. Yes. Mr. EosENTHAL. You have that, Mr. Kellogg? Mr. Kellogg. No. 33 Q. Can you also furnish a statement showing the officers and directors of the companies owned or controlled by stock ownership by any of the sub-companies of the Standard Company, a list of which has been furnished ? — A. I can make an effort to do it. I dont know whether that can be Mr. MiLBURN. We can get at a statement of all there is. Mr. EosENTHAL. That involves officers and directors of a great many companies, and we may have difficulty in getting names. Mr. Kellogg. Get all you can. Mr. EosENTHAL. Ycs. Mr. Kellogg. I should also like that statement to include the total capitalization of each one of the companies and sub-companies. Q. You say you have heard of the Manhattan Oil Company, Mr. Pratt?— A. Yes sir. Q. Engaged in business in Ohio? — A. I understand it is there; I am not familiar with the workings of the business at all. Q. Did you ever hear of the General Industrial Development Com- pany, of London, England ? — A. I know nothing about it. Q. Know nothing about it, never heard of it. Nor of the London Commercial Trading and Investment Company? — A. No sir. Q. Know nothing about the ownership of the Manhattan at all? — A. I do not. 34 Mr. MiLBURN. What is that second company ? Mr. Kellogg. London Commercial Trading and Investment Company, of London. Mr. lIiLBUEN. All right, thank you. Q. You know nothing about it ? — A. I do not. Q. You know nothing of the business of the Manhattan Oil Com- pany? — A. I do not. PKATT. 17 Q. Dont know whether it sells its oil to the Standard Oil Com- pany or to any agency of the Standard? — A. I never had any rela- tion with it whatever, jN'Ir. Kellogg ; know nothing about its business. Q. Made no inquiries? — A. I have not. Q. Is your business confined to keeping the stock-books and directors' records and stockholders' records of the Standard Oil Com- pany of New Jersey ? — A. Not entirely that, no sir. Q. ^Yha.t other business have you ^ — A. I am a director of the com- pany. Q. You are a director of the Standard Oil Company of New Jer- sey? — A. Yes sir. Q. Well, outside of that ? — A. I am a director of several other of the companies. Q. Name them. — A. The Atlantic Eefining Company, Standard Oil Company of New Jersey, Standard Oil Company of Kentucky, Standard Oil Company of Indiana, the Vacuum Oil Company of Italy, of London and Melbourne. 35 Mr. MiLBUEN. The Vacuum Oil Company, of London ? Witness. Yes. Mr. MiLBTjEN. And the Vacuum, of IMelbourne? Witness. That is right. And the Vacuum Oil Compaiij^ of Italy. I think that is all, Mr. Kellogg. Q. You have no other business except as director of those com- panies and as secretary of the Standard Oil Company ? — A. I am an officer of the Standard Oil Company of Kentucky. If you have reference to that ; I dont know that you mean that. Q. Do you take any active part in its business? — A. Yes. Q. ^ATiat is its business? — A. It is a distributing company, dis- tributing oil in the southern states. Q. South of the Ohio Eiver? — A. Well, they are mainly Gulf States: Tennessee, Alabama, Georgia, Florida. Q. Where does it buy its oil? — A. From the refineries of one of the Standard Oil companies. Q. Mostly of what company? — A. IMostly of the Indiana com- pany, as I recall. Q. At Whiting, Indiana?— A. Yes. Q. Who would know about the Manhattan Oil Company? — A. I dont know, sir. Q. You know of no official of the Standard Oil Company who would know about the Manhattan Oil Company ? — A. I do not. Q. What is the C. M. Pratt Investment ?— A. What, sir? Q. The C. M. Pratt Investment. I notice by the statements 36 furnished of the income of the Standard Oil Company of New Jersey, that the C. M. Pratt Investment had an income in 1902 of $137,400; in 1903 of $1,099,200; in 1904 of $1,853,700. Will you please explain what that is?— A. I am not absolutely clear, but I presume it relates to the stock of the Waters-Pierce Company, which I hold in the interest of the Standard Oil Company. 32555—08 2 18 PEATT. Q. Wlien did jon get that stock ? — A. As nearly as I recall, in the fall of 1900. Q. Did you hold it for the Standard Oil Company of New Jer- sey? — A. I did. Q. That stock comprised how many shares? — A. I think it was 2,740 odd, as I recall. Q. Out of 4.000 ?— A. Yes sir. Q. A total issue of $400,000 capital?— A. That is correct. Q. The income of the Standard Oil from that security in 1904 was $1,85.3,700, was it? — A. I have not checked the figures, Mr. Kellogg; I dont know. Q. Did that go through your hands? — A. Yes sir. Q. Those dividends? — A. Yes sir. Q. Who has charge of the books showing those figures? — A. I am not sure; I suppose the comptroller. Q. The comptroller. That is Mr. Brady? — A. Yes sir. Q. You got this Waters- Pierce oil stock about 1900? — A. 37 That is my recollection, sir. Q. It was organized under the laws of Missouri, was it not? — A. Yes sir. Q. Prior to that time there was another Waters-Pierce oil com- pany, wasnt there? — A. Well, Mr. Kellogg, I am not familiar with those details as to that corporation. Q. You are not familiar? — A. No. Q. Did you know about the Waters-Pierce Oil Company, which the Standard Oil Company owned the control of, prior to that time ? — A. I knew it in a general way, yes. Q. You knew of the proceedings in Texas to oust it from the state? — A. In a general way only. Q. What did you know about it in a general way? — A. Nothing except that it was a customer of the Standard Oil Company, buying oil from it, and that the Standard Oil Company had this interest in its business. Q. Well, what did you know about its being ousted from Texas in 1900? — A. I know nothing about it. Q. Never did know anything about it? — A. Only in a general way. Q. Well, what did you know in a general way about it? — A. Well, I cannot answer in detail. There is nothing more than that: that the state had brought this proceeding against the company. That is all I know about it. Q. And it resulted how? — A. Well, I dont know how it did result. 38 Q. You dont know how it did result? — A. No, I am not familiar with that. Q. You dont know why the new company was organized? — A. Well, I assume it must have been organized for some such reason, but I am not familiar with the details. Q. You are not familiar with them? — A. No. PRATT. 19 Q. Who is familiar with them? — A. I suppose an officer of the Waters-Pierce Company. Q. No one connected with the Standard Oil Company of New Jersey. — A. I would not like to say that ; I dont know. Q. You dont know? — A. No. Q. Well, its holding in that company was very considerable? — A. Yes. Q. And you held the stock ? — A. I did. Mr. MiLBUEN. He did not hold the stock at that time, Mr. Kellogg. Q. You did from 1902?— A. From the fall of 1900. Q. Down to 1904? Mr. MrLBUEN. Yes, at that time. Witness. That is correct. Q. Prior to that, you know nothing about it at all? — A. No, only in a general way, sir. Q. And you don't know who would know? — A. Other than some officer of the Waters-Pierce Company. Q. Well, but some officer of the Standard Oil Company of New Jersey must know something about its ownership prior to 39 1900 ? — A. Well, I cant name them, Mr. Kellogg. , Q. You dont know? — A. No. Q. Does the Standard Oil Company of New Jersey own stock in any company which owns any refinery or business in the state of Texas, other than the Waters-Pierce Oil Company?— A. I dont L know. Q. Do you know the Corsicana Refining Company? — A. Only by name. Q. What do you know of it?— A. Nothing more than it is in the ' state of Texas as a refinery. , Q. Who controls it? — A. I dont know. '' Q. Did you ever hear ? — A. I never did. ■ Q. The Security Oil Company?— A. I know nothing of it. ^ Q. You know nothing of it?— A. I do not. Q. Did you ever know anything of it?— A. Only in a general way. *" That is in the state of Texas. Q. What did you know of it, in a general way ? — A. Only that it , is a refinery in the state of Texas. ^' Q. Dont you know that the Corsicana Refinery is owned by H. C. *! Folger and C. N. Payne?— A. I do not. ■ Q. Who is Mr. C. N. Payne?— A. He is one of the employes of one of the companies of the Standard Oil Company. ' Q. What company?— A. I suppose it is the Ohio Oil Company, but I am not sure ; one of the producing companies. " Q. Any other company that you know of? — A. None that I re- call, no sir. rf 40 Q. Where is his office?— A. 26 Broadway. I* Q. 26 Broadway, the Standard Oil Building?— A. Yes sir. Q How long have you known him ?— A. Oh, a number of years. 20 PEATT. Q. Has he any other position than as an officer of the Ohio Oil Company?— A. I dont recall any other. He may have, but I dont recall. Q. Who is Mr. H. C. Folger? — A. He is in the employ of the Standard Oil Company of New Jersey. Q. Of New Jersey ? — A. Yes sir. Q. What position? — A. He is one of the mechanical experts who have the refineries in charge. Q. Has been for many years ? — A. For a number of years. Q. How long? — A. Oh, I dont know; ten or a dozen years, per- haps. Q. Do yoii know whether he is an owner of the Corsicana Kefining Company? — A. I do not. Q. Never heard of it ? — A. I have not. Q. Never made any inquiries at all ? — A. I have not. Q. What branch of the business do you say Mr. Folger has charge of? — A. A mechanical expert, connected with the refineries. Q. What refineries? — A. My impression is refineries on the East Eiver. Q. Simply the refineries on the East River? — A. That is my gen- eral impression. .41 Q. You dont know whether he has any connection with any other companies? — A. I do not. Q. You are a director, you say, in the Standard Oil Company of New Jersey? — A. Yes sir, I am. Q. And have been ever since 1899 ? — A. That is correct. Q. As secretary? — A. That is correct. Q. Is the business of that company or of its sub-companies,— I speak now of sub-companies, including those in which it owns the majority of stock — managed or looked after by committees? — A. I know of no such committees. Q. In any of the companies ? — A. Not to my knowledge. Q. Never heard of any such committee? — A. I dont think I ever have. Q. In either the Standard Oil Company or any of its sub-com- panies? — A. Not since that year, no sir. Q. Sir? — A. I dont recall any. Q. Did you ever hear of any such committees made up of offi- cials of the Standard Oil, or of any of the other companies? — A. Since 1899 I dont recall any. Q. Prior to that time ? — A. Possibly. Q. What do you mean by possibly, — that you have heard of it or have not heard of it ? — ^A. Well, I am in doubt about it. Q. Oh, you are in doubt about it ? — A. Yes. Q. You may have heard of it, you say ? — A. Yes. Q. What is your recollection of it ? — A. I dont think the Standard Oil Company of New Jersey ever had committees. ; PRATT. 21 42 Q. Any of the other companies controlled by the Trust or the Liquidating Trustees ? — A. Committees which were formed to do special things for an individual time, but no standing commit- tees that I recall. Q. Well, what were the committees ? — A. I dont know of any, but I am speaking generally. Q. Were you a member of any such committee ? — A. Will you read that question again, please? (Question was read.) A. What do you mean by that, Mr. Kellogg, please? Will you kindly enlighten me? Q. Any committee having charge of any branch of the business of any of the companies ? — A. And at what time, please ? Q. At any time. — A. The Standard Oil Company of New Jersey? Q, Prior to that time. — A. Well, that is going back a long ways, Mr. Kellogg. Q. I am quite aware of it. — A. It is possible there were commit- tees ; I think there were in the early days in the company. Q. Now, in what early days? During the trusteeship? — A. Yes sir. Q. Between 1882 and 1892?— A. I dont think so. Q. Between 1892 and 1899 ?— A. Will you give the first two dates again, please? Q. 1892 and 1899?— A. I dont think so, but prior to that 43 there may have been. Q. Prior to when? 1892?— A. Yes. Q. Between 1882 and 1892 ?— A. Yes sir. Q. During the period when these companies were controlled by the Trust — I am speaking of the Standard Oil Company trust agree- ment A. Yes, I understand. Q. You were not one of these Trustees ? — A. I was not. Q. You were one of the Liquidating Trustees?— A. For a short time. ■ Q. For a short time ? — A. Yes. Q. Are you familiar with the manner of liquidations? — A. In a general way, I am, yes sir. Q. There was a resolution passed liquidating the Trust in 1892, was there?— A. 1892? Q. Yes.— A. Yes ; that is correct, yes sir. Q. During that time until January 1, 1899, the Trusteaie were liq- uidating the Trust, were they?— A. Why, technically; legally, they were, but practically the buisiness was liquidated immediately in 1892. Q. They continued from year to year to issue assignments. Liq- uidating Trustees' assignments, for the stock of the sub- companies represented by the Trustees' certificates, did they not?— A. Only a : small portion ; a great majority of it immediately liquidated in 1892. Q. Have you the books showing the amount liquidated from time to time?— A. I have no doubt such books exist. I havent them. 22 PEATT. 44 Q. You were one of the Liquidating Trustees a part of the time? — A. I was. Q. And the Liquidating Trustees kept books showing the manner of liquidation? — A. The record showing the liquidation appears on the Standard Oil Company of New Jersey (books) ; I dont remem- ber of any books of the Liquidating Trustees. Q. The record showing the manner of liquidation appears on the books of the Standard Oil Company of New Jersey? — A. On the minute-book, yes sir. Q. On the minute-book ? — A. Yes sir. Q. Wh&t books did the Liquidating Trustees keep showing the liquidation from time to time? — A. I know of none, Mr. Kellogg, but I would not perhaps know of all. I simply was familiar with the certificate-book. Q. ^^o kept the certificate-book of the Liquidating Trustees?— A. I really dont know, sir. Q. You say you knew of it? — A. Oh, yes; I signed. Q. What do you know of it? — A. I signed one or two at the last portion or period of the Liquidating Trustees' control, one or two certificates. Q. Where are those books? — A. I dont know, sir. Q. In whose possession were they kept at the time? — A. I dont know that. Q. Did you ever know? — A. I never did. At least, I dont recall that I ever did. I am answering to the best of my recollection. 45 Q. You have no knowledge as to who kept the books of the Liquidating Trustees showing the liquidation, or where they can be found ? — A. I have not, no sir. Q. Who had charge of the comptroller's office of the Liquidating Trustees? — A. I am not sure, but I think it was Mr. Clark's period of official relations. Q. Well, then, those books would be in Mr. Brainerd's or Mr. Fay's possession now, would they not ? — A. I dont know, sir. Q. You have never seen them? — A. Nothing but the certificate- book ; that is the only one I ever saw. Q. Naturally, the books would be in the control of the present comptroller of the Standard Oil Company, would they not? — A, Well, I cant answer as to that, Mr. Kellogg. Q. You dont know ? — A. No. Q. During the period of the Standard Oil Trust, from 1882 to its dissolution in 1892, what officer would have control of the books show- ing the stocks, bonds and securities owned and controlled by the Trus- tees, the earnings of the Trustees, the dividends paid upon the trust certificates and the earnings of the sub-companies or the companies in which the Trustees held the stock? — A. I dont know, Mr. Kellogg. Q. Do you mean that you have no knowledge whatever of who kept the books of the Trustees bf the Standard Oil Company? — A. That is what I mean, yes sir. PEATT. 23 46 Q. Or of what department would keep that book? — A. I suppose it would be the comptroller's office, but I really dont know. Q. You dont know ? — A. I do not. Q. You dont know who was comptroller then ? — A. I am not sure. Q. The stock of the Standard Oil Company of New Jersey was in- creased in January, 1899, from about ten millions to one hundred ten millions, was it not ? — A. That is correct. Q. You are familiar with that? — A. Yes sir. Q. At that time, or before that stock was increased, the Liquidating Trustees, and prior to their time the Trustees of the Standard Oil Trust, held the stock in about twenty different companies, did they not? — A. I never have counted them. That may be approximately correct. Q. A large number of companies ? — A. Yes sir. Q. And about January, 1899, and during the months following that, the large majority of the stock of these companies was trans- ferred to the Standard Oil Company of New Jersey, was it not ? — A. 1899 ? The method, as I recall it, Mr. Kellogg, if you are seeking to trace the change which occurred, was on the liquidation of the Trus- tees; an assignment of legal title was taken by the shareholders, and those in turn converted into their proper ownership of stock in the constituent companies, and those were carried in that relation- 47 ship for a number of years during the legal liquidation of the company. Q. But all of those Mr. MiLBUEN. Let me ask: The legal liquidation of the company, did you say, or of the Trustees ? Witness. Of the Trustees, I should say. There was no company. Q. All of those stocks were not assigned, were they, prior to Jan- uary 1, 1899? — A. Oh, I think they were all assigned before they were converted into the Standard Oil Company of New Jersey. Q. Do the books of the comptroller's office show the amount of assignments from time to time and the course of that liquidation? — A. I dont know what books show it, sir. Q. Have you ever seen a statement showing that liquidation from year to year? — A. I never have. Witness. Mr. Kellogg, will you allow me to have the answer read, please, to the question just previous to this last one? Mr. Kellogg. Yes, sir. The following question and answer were read : " Q. All of those stocks were not assigned, were they, prior to Jan- uary 1, 1899 ?— A. Oh, I think they were all assigned before they were converted into the Standard Oil Company of New Jersey." Witness. Before they were sold by their owners. Q. How many companies did the Trustees own or own the stock of, at the time of the liquidation ?— A. I dont know exactly, 48 sir ; approximately, twenty, I should say, but I dont know. 24 PKATT. Q. Do you know whether the list I show you on page 62 of the bill of complaint is the correct list, with the total capital stock and the capital stock in each comjoany ? — A. I would laot knoAV exactly about that, Mr. Kellogg. Q. Who would know ? — A. I suppose the comptroller's office would know. Q. And those books are in the office of the Standard Oil Company of New Jersey, now? — A. Pardon nie, what is the date there? At what time? Q. 1892, the date of the liquidation. — A. I dont know where those books are, sir. I have said that before, sir. That is true. Q. You dont know anything about it ? A. I do not. Q. Where would they naturally be? — A. I dont know that; pos- sibly the comptroller's office, but I dont know. Q. Dont you know the organization well enough to know whether they would be in the comptroller's office or in the secretary's, or in the treasurer's, or some other office? — A. I had nothing to do with those things, Mr. Kellogg, in those days, and I dont know what the organization was. Q. You know nothing about the organization of the Standard Oil Company, then- Mr. MiLBUEN. Oh, now 49 Mr. Kellogg. Or the Standard Oil Trust. — A. No sir, I do not. Mr. MiLBUBN. That is different. Q. You know nothing about it? — A. I do not. Mr. MiLBURN. Naturally be in the possession of the Trustees, wouldnt they? Q. Did you ever examine to see how many shares of those sub- companies were assigned during each j^ear from 1892 down to 1899 ?^ A. I did not. Q. Then j'ou dont know whether the liquidation was completed before the organization of the present system and placing those stocks in the Standard Oil Trust or not? — A. I am not sure. Q. Do the books of the present controller of the Standard Oil show anything about that? — A. I dont know. Q. How many Trustees' certificates were there outstanding Janu- ary 1st, or at the time of the liquidation in 1892 ? — A. Will you give me that again? Q. How many Trustees' certificates of the Standard Oil Trust were there outstanding in 1892 ? Mr. EosENTHAL. You mean when the liquidation began? Mr. Kellogg. Yes sir. Q. Why, I suppose 970 odd thousand. I am not _ Q. Was it not 972,500?— A. I am not sure but what it was; pos- sibly. I dont carry that figure exactly in my mind. Q. And for the stocks representing those certificates, did not the Standard Oil Company of New Jersey issue 972,500 shares of its PEATT. 25 stock of $100 each? — A. I have explained to you, sir, how that process took place. 50 Q. They issued the same number of shares in the Standard Oil Company of New Jersey as previously existed, issued by the Trustees of the Standard Oil Trust, did they not?— A. Possibly the number is the same. Q. Do you know whether it was or not?— A. Only in a general way. Q. Well, do you know it in a general way ?— A. If you will accept the process which was actually carried out, that result may have been as you state. Q. Well, was it or was it not?— A. Well, I should say that perhaps it was. Q. Well, you should say it was, shouldnt you?— A. Well, I am not undisposed to say that, yes sir. Q. Well, you know it was, dont you ?— A. I think the capital was practically the same. Q. In other words, the Standard Oil Company of New Jersey issued for the stocks of those twenty sub-companies the same number of shares as the Trustees at one time had outstanding representing those same stocks? — A. The shareholders of these different corpora- tions, Mr. Kellogg, Q. Well, please answer that question, will you? — A. Well, it is incidentally so, yes sir; incidentally so. Q. Well, I dont care whether it is " incidentally " so or not. It is so, isnt it? — A. Well, it makes a different as to the method. Q. Well, we will get at the method. — A. All right. 51 Q. Now, the Standard Oil Trustees were who? Mr. Rosenthal. May we have that last question that Mr. Kellogg asked read, Mr. Stenographer ? Mr. Kellogg. Certainly. The testimony was read. Mr. Rosenthal. If you want to go ahead and explain it, Mr. Pratt, you are at liberty to do so now in connection with your answer. Q. Make any explanation you desire. — A. Well, the explanation, Mr. Kellogg, I made befoie, and which I would like to make again, is this: That the Standard Oil Tnist certificates on the liquidation were exchanged for assignment of title, legal title, to those who owned the trust certificates, and they in turn took their jsroper allotment of the stocks of the individual corporations which made up the Stand- ard Oil Trust, and seven years after the stockholders of those indi- vidual corporations sold their stock for a certain number of shares of the Standard Oil Company of New Jersey. That is the explana- tion. Q. They sold their stock for exactly the same number of shares of the Standard Oil Company of New Jersey that they held in the Standard Oil Trust, didnt they, and the same number of shares were issued ? 26 PKATT. Mr. MiLBURN. They kept their holding. Witness. That was seven years, of course, after the liquidation. I dont know what changes took place during those seven years. Q. Very well. The Standard Oil Company of New Jersey 52 issued exactly the same number of shares for the stocks of those sub-companies as the Trustees had previously issued and had outstanding, $97,250,000; is not that correct? — A. Yes sir, that is a correct statement. The individuals may have been different, however. Q. So that for each share of $100 of the Trustees' certificates out- standing and issued by these Trustees, representing the stocks in these sub-companies, the Standard Oil Company of New Jersey issued a like amount of stock of $100 each to the owners of those shares in the sub-companies; didnt they? — A. Not to those owners. Mr. MiLBTiRN. Just a moment, please. Let me have that question. I think you have got it wrong, Mr. Kellogg, to begin with. Mr. Rosenthal. Well, the witness apprehended it, because he has answered it correctly. Mr. MiLBunx. All right; go ahead, then. Witness. Not to those owners, I said. Q. Issued the same amount, didnt they? — A. To whomever was entitled to it, yes sir, on the shares of their individual shares to the sub-companies. Q. Now we will get at the details of that. At the time the Stand- ard Oil Trust was organized, the stockholders of about forty com- panies, stated in the bill of complaint, placed their stoclt in 53 the name of nine Trustees under this trust agreement, did they not? — A. I know nothing of it except as a young man who signed a paper, Mr. Kellogg, because he was legally entitled to a few shares Mliicli his father put in his name. More than that I know nothing. Q. You know nothing. Mr. J. D. Rockefeller was one of the Trus- tees, was he not ?— A. That is my recollection, yes sir. Q. O. H. Payne, William Rockefeller, J. A. Bostwick, H. M. Flag- ler, W. G. Warden, Charles Pratt, Benjamin Brewster, and Jolin Archbold ; is that correct ? — A. I assume so ; I don't knoAV of my own knowledge. Q. You dont know. That trust existed for ten years, did it not ?— A. Practically so, yes sir. Q. During that time you say you had nothing to do with the Trust at all? — A. Absolutely nothing at all. Q. But you know in a general way about it? — A. Only in a gen- eral way. Q. In 1892 is the time which you mention that the Trust was dis- solved? — A. Yes, that is correct. Q. What occurred at that time to cause its dissolution? — A. I am not a lawyer, Mr. Kellogg. I don't know that I can answer definitely, but this is my impression : that the State of Ohio brought suit against PKATT, 27 the Standard Oil Company of Ohio for trusteeing its stock and pro- hibited it from further doing so. Q. The Trust was declared void, wasnt it? — A. No, I dont understand the Trust was declared void, but the Standard 64 Oil Company of Ohio was prohibited from dividing its profits through trusteeship relation. Q. Well, the record will show, of course. — A. Certainly. I am not a lawyer. Mr. MiLBUEN. You are pretty sound about it. Q. The record will show what that was. We will introduce it. At that time the Standard Oil Trustees had outstanding Mr. MrLBTJEN. Now he doesnt know. Why do you ask him? He was not a Trustee. He was an employe at that time. Mr. Kellogg. I am trying to find out who does know. Mr. MiLBUEN. Why do you call a man who could not by any pos- sibility know the things you ask him? Mr. Kellogg. Tell us who does know and we will call him. Mr. MiLBUEN. Well, you know as well as I know who knows. You know just as well as I know who the managing Trustees are and who can give you all the information. Q. The Trustees had at that time outstanding, $97,200,000 par value of trust certificates, did they not? — A. I was not associated at the time of the dissolution. I came in later, towards the end of the liquidating trusteeship. Q. I believe you say that figure is correct ; isnt it ? — A. So far as I know it is correct. But I have no definite knowledge about it, sir. Q. In signing some of these assignments, you had to know, did you not, how many certificates were outstanding? — 55 A. Well, that was some years after. Q. Very well, but the number was the same, wasnt it ? — A. I dont know whether it was or not, Mr. Kellogg; perhaps it was. Q. Well, you do know there were no certificates issued from 1892 to 1899, dont you ? — A. No certificate issued ? Q. Trustees certificates. — A. Yes, that is con-ect. Q. Then the number in 1892 was the same as in 1889, wasnt it? — A. That existed in 1889 ? Q. Yes sir. I mean the number in 1899 was the same as existed in 1892. Mr. MiLBTJEN. It could not be, Mr. Kellogg. They had been re- tired, the great bulk of them. They were not out at all. Q. But understand what I mean. No certificates in addition to those issued in 1892 were ever issued, were there?— A. The Trust was closed in 1892. Q. And no more certificates ever issued ?— A. Certainly not. Q. Very well. Then, at that time all the stocks held in the treasury or held by the Trustees were divided into parts, were they not, for the purpose of liquidation, and assignments made of those parts?— A. I dont know that I quite understand your question. Will you give it to me again, please ? 28 PEATT. Q. I say all of the stock held by the Trustees of the Standard Oil Trust were divided into parts corresponding with the number 56 of certificates which had been issued by the Trustees and out- standing at that time? — A. Why, the individual corporations held by the Trustees, on the dissolution of the Trust, assumed their own corporate relation. Q. That is what I am talking about. — A. Allow me to continue. Q. All right, sir. — A. And the share of stock which the individual holder of the trust certificate, who had taken his assignment of legal title, and turned it in, received his pro rata share of the stock of those individual corporations. Q. Very well. — A. If that answers your question. Q. Take the Standard Oil Company of Ohio. Its stock was held in 1892 by the Trustees of the Standard Oil Trust, was it not? — A. At that time, yes. Q. Into how many shares or how many parts was that stock divided for the purpose of liquidation? — A. I dont know, sir. At that time I had nothing to do with it. Q. Dont know whether it was divided into 972,500 parts, corre- sponding with the number of trust certificates outstanding that had previously been issued by the Standard Oil Trustees? — A. I am not an accountant, Mr. Kellogg, and I cant answer. Q. I show you one of the assignments. (Handing witness bill of complaint. 5*7 Mr. Rosenthal. The question is not what you know from that book you are reading, Mr. Pratt; it is what you know of your own knowledge. Witness. I understand, IVIr. Rosenthal. I am trying to under- stand the question, Mr. Kellogg. I had nothing to do with the thing at that time and I dont know in detail. I have explained all I do know, sir. Q. But you were one of the Liquidating Trustees in the latter part of the time. — A. Yes sir, the latter part of the time. Q. They issued the same kind of assignments when you were Trustee as they did before ? — A. If they did, that is probably correct. Q. Well, did they, or did they not? — A. I dont think there was any change, as far as I know. Q. Well, you know what the assignment meant, do you not? — A. I doubt whether I do actually know, Mr. Kellogg; that is the diffi- culty I have about it,— not to evade the question at all. Q. Did you have any shares in any of these companies? — A. Yes, I did. Q. You had some certificates? — A. Yes. Q. Of the Standard Oil Trust?— A. I did. Q. And .you received your aliquot part of the stocks in all the sub- companies? — A. I did. Q. How many certificates did you have? — A. I dont recall how many thero were, but all the individual corporations, of course, were represented. PKATT. 29 68 Q. Now, if you had one hundred shares of certificates issued by the Trustees of the Standard Oil Trust, you got your pro- portion of the stock of each of the sub-companies, didnt you? — A. Yes. Q. Very well. Then the stock of all the sub-companies was divided into parts, one part representing each certificate which the Trustees had issued and had outstanding ; is that true ? — A. I cant answer ; I dont know. Mr. MiLBUEN. All of which is admitted in the answers. It is all set out. Mr. Kellogg. It is not denied ? Mr. MiLBTiBN. It is all set out and expressly admitted. Q. You dont know about that ? — A. I do not, Mr. Kellogg. Q. And you dont know just how the transfer was made to the Standard Oil Company of Xew Jersey? — A. I have explained that. Q. You have? — A. I have. Mr. Kellogg. Mr. Milburn, have you produced the Mr. Melbtjen. I'll produce you anything I have, with pleasure. Mr. Kellogg. Have you produced the Trustees' certificates issued by the Trustees of the Standard Oil Trust, received by the Standard Oil Company of New Jersey during said time ? Mr. EosENTHAL. Whatever we have produced we have turned over to you, Mr. Kellogg. Mr. Kellogg. Well, I havent received any certificates. 59 Mr. Rosenthal. Well, we have not got them as yet, because we have been turning these things over to you as rapidly as we have been able to get them. Mr. MiLBTjEN. You asked for the certificates. Mr. Kellogg. Also all Liquidating Trustees' certificates issued by the Liquidating Trustees of the Standard Oil Company Trust. Mr. MiLBUEN. We have not got them yet. Mr. Kellogg. All assignments of legal title to stocks and securi- ties issued by the Trustees of the Standard Oil Trust or by the Liqui- dating Trustees of the Standard Oil Trust. Mr. Milburn. Now, which one? We are not asked for those, are we ? We havnt got them. "All liquidating certificates issued by the Liquidating Trustees of the Standard Oil Trust, received by the Standard Oil Company of New Jersey." Now, if we have them we will produce them, but I don't understand we have any liquidating certificates or any assignments of title. Mr. Rosenthal. Not a one. Mr. MiLBUEN. Never came into our possession. Mr. Kellogg. Well, let's see if we can find out where they are. Q. Where are the Trustees' certificates issued by the Trustees? — A. I dont know, Mr. Kellogg. Q. What did you do with yours ? — A. Why, I turned mine in, sold it to the Standard Oil Company of New Jersey, and toolc the stock. 30 PRATT. 60 Mr. MiLBXJEN. He is asking what you did with your Trustees' certificate. Witness. Trustees' certificate, the original trust certificates ? Q. Yes sir.— A. I turned mine in and received assignment of legal title. Q. To whom did you turn it in? — A. I suppose to the Trustees; I dont know. Q. You dont know. You received Liquidating Trustees' assign- ment? — A. Assignment of legal title, yes sir. Q. T\1iat did you do with that? — A. That I held, and converted that into my pro rate aliquot part of the stocks of the individual corporations. Q. Oh, of the individual corporations? — A. Yes sir. Q. And those stocks, what did you do with those ? — A. I sold those to the Standard of New Jersey for the new common stock. Q. You received from the Standard Oil of New Jersey the same number of its shares which you had previously held of the shares of the Trustees, did you not? — A. I am not sure whether I sold or dis- posed of any of mine or not. Q. But if you didnt sell any, you received the same number of shares? — A. That we have gone over. Yes sir, that is true. Q. And in a general way all other certificate holders received the same thing? — A. I cant answer as to their holdings. 61 Well, that was the plan, was it not, under which the trans- action was made ? — A. I have explained the plan, sir ; I think it is clear. Q. Was that not the plan? — A. I dont know that it had anything to do with the plan. I dont think it was the plan except as the plan worked out to that result. Q. Well, that was the result ? — A. That was the result, yes sir. Q. You dont know who the custodian was of the Trustees' certifi- cate after they were redeemed? — A. I do not, no sir. Q. Well, naturally, would it be the controller or the treasurer or the secretary of the Standard Oil Company? — A. I dont know, Mr. Kellogg, who it naturally would be. I dont recall. Q. Or the Trustees ? You dont know ? — A. I do not. Mr. MiLBTjRN. I think absolutely it would be the Trustees. Mr. EJJLLOGG. Is Mr. Fay here? Mr. MiLBTJRN. He is present. Mr. Kellogg. I may want to recall Mr. Pratt, but I want to put Mr. Fay on. Mr. MiLBUEN. Cant you finish up with Mr. Pratt ? Mr. Kellogg. No. Mr. KosENTHAL. I dont know what control the Examiner has over the order of examination, but as a general principle we would 62 like to have the witnesses exhausted, gotten through with while they are on the stand, if that is possible. It may not be possible in Mr. Pratt's case, but generally speaking, I think the proper procedure ought to be to get through with a witness both on FAY. 31 direct and cross, so that we may know when a given witness is no longer in attendance, merely as a general proposition, that is all. Mr. Kellogg. Well, we subpoenaed officers to produce certain books. They offered to make up statements, with opportunities to examine the books. We got those statements, and, I have no doubt, as fast as they could furnish them, and we didnt get any until Friday last, and we ha^•ent got them all yet. We have had no opportunity whatever to examine their books, and we didnt get with those state- ments the name of the officer or person who could testify to the cor- rectness of them, and we simply had to subpoena and place on the stand the men who we supposed knew, and Mr. Pratt says Mr. Fay is the controller and has charge of making up these statements. We may wish to ask Mr. Pratt some more questions. Mr. EosENTHAL. No objection to that. Mr. Kellogg. We ask that Mr. Pratt be excused at present. The Examiner. Do you desire to cross-examine him now ? Mr. Rosenthal. No sir, not until he is turned over. The Examinee. You may stand aside. Of course, Mr. Kellogg, you understand as a general proposition it makes the record in better shape to have the testimony of the witness in one place. Mr. Kellogg. Quite so. 63 The Examinee. Of course, it happens in every trial occa- sionally it is necessary to withdraw a witness. Mr. Kellogg. We are subpoenaing hostile witnesses, men whom we cant tell how much they know about this. Mr. Rosenthal. Well, that is hardly a fair statement, so far as the witnesses who have been on the stand. The Examinee. Well, there is no controversy at the moment. 64 Fay. Clarence G. Fay, called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct-examination by Mr. Kellogg : Q. What is your full name? — A. Clarence G. Fay. Q. What position do you occupy with the Standard Oil Company of New Jersey ? — A. I am assistant controller of that company. Q. How long have j'ou been? — A. Since, I think, June 16th or 15th of this year. Q. Have you been in the controller's office longer than that? — A. Yes sir. Q. How many years? — A. Since that office became the controller's office. Q. When was that? — A. I could not answer that without refer- ence. Q. Well, about how many years ?— A. I think it was in 1899. Q. When the controller's office of the Standard Oil Company of Xew Jersey was created? — A. Yes, sir. 32 FAY. Q. Previous to that time what position did you occupy with the Standard Oil Company or any of its organization ? — A. Simply that of a clerk. Q. What office? — A. Simply a clerk. 65 Q. In what office?— A. In the secretary's office for a short time; previously to that at a domestic trade station in New York State. Q. In the secretary's office of the Standard Oil Company of New Jersey?— A. Xo, the Standard Oil Company of New York. Q. You were not in the controller's office of the Trustees? — A. No sir. Q. Or the Liquidating Trustees ? — A. No sir. Q. Who is the controller of the Standard Oil Company ? — A. Mr. A. H. Brainerd. Q. How long has he been, do you know ? — A. I could not say. He succeeded Mr. L. D. Clark, the former one. Q. Where is Mr. L. D. Clark ?— A. Mr. L. D. Clark is confined to his bed with a stroke of apoplexy. Q. Where is Mi: Brainerd ? — A. Mr. Brainerd I dont know ; he is on a leave of absence on account of sickness. Mr. MiLBUEN. When did he succeed Mr. Clark? Can you give us that? Witness. I cant state. Mr. MiLBTJRN. About when ? Witness. I think it was about January 1, 1904 ; I wouldnt be cer- tain of that date. 66 Mr. Rosenthal. How long has Mr. Brainerd been away? How long has Mr. Brainerd been absent on leave ? Witness. Since the 15th of June. Q. Do you know when he is expected back ? — A. I do not. Q. Who was assistant controller previous to your term? — A. Mr. A. H. Brainerd. Q. Who was the controller ?— A. Mr. L. D. Clark. Q. Oh, Mr. L. D. Clark. I show you Petitioner's Exhibit 1. Was that prepared by you or under your direction ? — A. It was prepared under my direction. Q. Is it a correct statement of the securities owned and held by the Standard Oil Company of New Jersey as of September 14, 1907?— A. It is. Q. With the total number of shares of each company? — A. Yes sir. Q. Is it taken from books of original entry? — A. As regards the shares, yes. Q. Are those books kept in the regular course of business by the controller of the Standard Oil Company of New Jersey ? — ^A. Under the supervision of the controller, yes sir. Q. You say as regards the number of shai'es owned by the Standard Oil Company of New Jersey, of September 14, 1907, these are 67 taken from books of original entry? — A. Yes sir. PAY. 33 Q. The same as to par value and ownership of bonds? — A. Yes sir. Q. The statement, " date of acquisition " and " from whom ac- quired," from what books is that information taken or was that information taken?— A. I think, Uv. Kellogg, the same records would cover it. Q. All those statements, the same books of original entry? — A. There might possibly be some statements there under " remarks " which would not be covered by the books— would not show on the records. Mr. Kellogg. Well, is it admitted that that statement is a correct statement ? Mr. Rosenthal. Oh, surely, yes. Mr. Kellogg. It is admitted that these statements furnished, together with the " remarks," correctly set forth the ownership and Mr. Eosenthal. It is admitted that the statement is accurate for just exactly what it purports to cover, that is all. Mr. Kellogg. All right. Mr. MiLBUEN. How is that marked? Mr. Kellogg. That is marked Petitioner's Exhibit 1. Mr. MiLBTjRN. Let us have it in the minutes. Mr. Kellogg. I offer in evidence Petitioner's Exhibit 1. 68 Q. I notice a large number of companies the stock of which is marked in this statement " acquired between June 19, 1899, and December 21, 1904, from sundry parties." — A. Yes sir. Q. Are those the companies the stocks of which were previously held by the Standard Oil Trustees ? — A. The Standard Oil Company of New Jersey's records from which these figures were taken show these stocks as acquired from individuals. Q. Were those stocks previously held by the Trustees of the Stand- ard Oil Trust? Mr. MiLBiTRN. How could he know ? Mr. Rosenthal. He could not possibly know anything about it. Mr. KJELLOGG. Well, let him answer then, that he dont know. Then I will find out who does know. Mr. Rosenthal. It is impossible for him to know. Mr. Kellogg. Well, I will try, at least. Q. Will you answer?— A. Why, I have seen the same company's name appear in stocks said to have been held by the Trustees. Q. Where have you seen those?— A. I dont recall the particular place that I saw those, Mr. Kellogg. Q. In any book in your office ?— A. Not that I recall. Q. You dont know where you saw them ?— A. No sir. 69 Q. Well, do you know whether they are the stocks which were previously held by the Standard Oil Trustees?— A. No sir. ' 32555—08 3 34 FAT. Q. Were all those stocks acquired about December 14-, 1904?— A. December 21 is the date. Q. December 21st, I mean, 1904.— A. They were all acquired be- tween June 19, 1899, and December 21, 1904. Q. Well, do the books of your office show how many were acquired in each year ?— A. The New Jersey books would show, yes sir. Q. Were not most of those stocks acquired duiing the year 1899 ?— A. Yes sir. Q. Do your books show just how many were acquired during each month or during the year of 1899 ?— A. Yes sir. Q. Can you make up that statement by the years ? — A. Yes sir. Q. Will you do so? Mr. MiLBUEN. Yes. I told him — I dont know but what it was by years ; you said to me that you would be satisfied with years. Mr. Kellogg. I will be perfectly satisfied with the years. 70 Mr. MiLBUEN. Segregate that into the stocks acquired each year from 1899 on. Mr. Chase, you make a note of that for me. Mr. Kellogg. I will put it in the form of a request. Please make up that statement Mr. MiLBUKN. A supplemental statement. Mr. Kellogg. A supplemental statement, showing the amount of stock acquired during each year from 1899 to 1904 inclusive, for the twenty companies I am speaking of, that appear in here to have been acquired between June 19, 1899, and December 21, 1904, through sun- dry parties. Q. Do the books show the parties from whom those stocks were acquired? — A. No sir. Mr. Rosenthal. Do you understand just what Mr. Kellogg wants? Witness. Yes, except he asks for twenty companies; there were only nineteen. Mr. Kellogg. That is right, nineteen ; the Standard Oil Company of New Jersey would be one of the twenty. Mr. Rosenthal. Well, you understand the character of the request so that you can go right to work on it ? Witness. Yes sir. Q. Your books do not show from whom that stock was acquired ?— A. No sir. Mr. Rosenthal. You asked him that before. 71 Q. Do the books show what was issued in lieu of that stock? A. Yes sir. Q. What was it ? — A. Standard Oil Company of New Jersey com- mon stock. Q. Wliat was the basis of exchange of the stock of the Standard Oil Company of New Jersey for the stock of those twenty companies, or nineteen companies? — A. I could not answer that, — give you those figures offhand, Mr. Kellogg. Q. Well, I will pursue that after lunch. A recess was here taken until 2 o'clock P. M. PAY. 35 '''2 Aj'teenoon Session. Clarence G. Fay recalled, and his direct-examination resumed, as follows : By Mr. Kellogg: Q. I notice in the column of " Shares " among those companies, nineteen companies, fractional shares. — A. Yes, sir. Q. For instance, the Anglo-American Oil Company, Limited, 49,987 shares and 764,500/972,500 of a share, ^^liat does that mean, that fractional share? — A. That fractional share represents scrip. Q. ^Yho was the scrip issued by? — A. In those twenty companies? ' Q. Yes. — A. By the companies. Q. How did those shares of the twenty companies happen to be divided into 972,500 parts? — A. I have never worked out that calcu- lation, Mr. Kellogg. Q. I notice each one of these companies, nineteen of them, have fractional shares, and all those fractions are fractions of 972,500 parts. — A. Yes sir. Q. Do you know how that happens to be? — A. I think I could explain that, Mr. Kellogg, but not readily. Q. Well, give us your explanation of it. — A. I mean the explana- tion would be too long to state without some thought. Q. Well, give it to us, never mind the length of it. — A. 73 (After some hesitation.) One share of the Standard Oil Com- pany, of Xew Jersey, common stock was issued in exchange for fractional shares of each of those twenty companies, the denom- inator being 972,500 of each. Q. Now, why was the denominator 972,500? Was it not because the stock of the nineteen companies held by the Standard Oil Trustees was divided into 972,500 parts? — A. I couldnt answer that question, Mr. Kellogg. Q. You couldnt answer it? — A. No sir. Q. Dont your books show it ? — A. No sir. Q. The books do not show it? — A. I only show those fractions which I have reported to you on those sheets. Q. You dont know that was the fact, then ? — A. No, sir. Q. Now then, the controller's office of the Standard Oil Company of New Jersey started business June 14, 1899, did it ?— A. I couldnt say as to the date. Q. Well, dont your hooks show ? Mr. MiLBUEN. What started business? Mr. Kellogg. The controller's office of the Standard Oil Company of New Jersey.— A. Oh, I think before that, Mr. Kellogg. Q. Well, when was it? — A. I couldnt say from recollection. Q. June 19, perhaps it is. Your books show they took over these stocks June 19, or commenced to take them over June 19, 1889. Well now, as to the business of those sub-companies, the controller's books commenced at that time, did they not?— A. We had stocks on our books prior to '89. 36 PAT. 74 Q. As to those companies, I say.— A. Yes sir, as to those companies. Q. And the business of those companies, so far as your books show, they commenced about that date ?— A. That is correct. Q. Now, what do your controller's books show as to those com- panies, the stocks of which you took over, commencing June 19, 1899?— A. It shows that we received those stocks in exchange for common stock issued, between the dates as stated on that .report. Q. And it shows earnings of those companies and dividends of those companies commencing from that time, dont it? — A. Com- mencing from the closing period, probably, of that year. Q. The closing period of that year. In other words, the earnings of the Anglo-American Oil Company, Limited, from the time you took over those stocks, would appear in your office, in your books, wouldnt they? — A. Only the Standard Oil Companies of New Jer- sey's proportion of such earnings. Q. Very well. If the Standard Oil Company owned all the stock it would get all the dividends, wouldnt it? — A. Naturally. Q. Didnt it own all the stock except two and a fraction shares ? Mr. Rosenthal. What company? Mr. Kellogg. The Anglo-American Oil Company. A. No sir. Q. Well, it acquired it afterwards. — A. Twelve and a fraction shares. T5 Q. Now, then, the controller's books of the Standard Oil Company of New Jersey would show the earnings of the Anglo-American Oil Company, Limited, or the Standard's propor- tion of it from the time you took over those stocks, wouldnt they?— A. Yes sir. Q. Very well. And that is true of each one of those companies — nineteen companies — which were acquired in the same manner and about the same time ? — A. Yes sir. Q. Very well. Where are the books that show the earnings for the few days or the few months before the Standard took over those nine- teen companies ? — A. I laiow of no such book. Q. You know of no such books? — A. No sir. Q. Do you mean to say that there is not, in your office or in the con- troller's office, and never has been, any book showing the earnings of any of those companies prior to 1899? — A. No, I didnt make that statement, Mr. Kellogg. Q. Well, are there any such books ? — A. There may be. Q. I want to know whether there are ; not whether there may be. — A. I could not state that there were. Q. Do you know that there are not? — A. No sir. Q. Have you ever seen them ? Answer the question, please. — A. I dont just follow your question, Mr. Kellogg. Mr. Kellogg. I think you understand it. Please read it. Witness. I do not. The question was read. FAY. 37 76 A. That is, books that carried the earnings of those com- panies prior to the time that the New Jersey Company acquired them? Q. Yes sir, or any part of the earnings. — A. Or any part ? There were such books, Mr. Kellogg. Q. Where are they? — A. I couldnt state where they all are. Q. Where are part of them? — A. There may be some in my office. Q. Will you produce them ? Mr. MiLBTjEN. Yes. Mr. I&:llogg. Very well ; I want them. Mr. MiLBUKN. That is, whatever he finds that may be in his office ; that is, in the controller's office. Q. Now, you have seen books in the controller's office which showed the earnings of these companies prior to the time the Standard Oil Company acquired the stocks ? — A. I so stated, yes sir. Q. Those books run back how many years ? — A. I couldnt say, Mr. Kellogg. Q. From 1882 to 1899 ?— A. I couldnt say. Mr. MiLBTjRN. Mr. Kellogg, I will have Mr. Fay examine what there are of those old books and let you know, every book that there is there bearing on these subjects, so that you shall have a list of them tomorrow morning. Mr. Kellogg. All right. Q. Now, those books will show, will they not, how those fractional shares happened to be issued ? Mr. Rosenthal. The books of the Standard Oil Company of New Jersey show that, Mr. Kellogg, not the old books. 77 Mr. Kellogg. Just a moment. The question was read. Q. Will they ? — A. I couldnt say without referring to those records, Mr. Kellogg. Q. Now, your books will show (the books of the Standard Oil Com- pany of New Jersey) that you did receive fractional shares of these nine sub-companies A. Yes sir. Q. B^sed on the denominator of 972,500?— A. Yes sir. Q. Now, do you know how it happened that those shares were divided into that number ?— A. No sir. Q Do your books show the details of the transactions in the ex- change of these shares?— A. They will show that we received those shares in exchange for the common stock. Q The date they were received will appear?— A. I couldnt say that the date would always be the date that they were received. Q. Substantially the date, I mean.— A. Yes. Q. Of whom received ?— A. No sir. Q Does not show that?— A. Not the books. Q. Does it show to whom the shares of the Standard Oil Company were issued ?— A. No sir. . Q. Any book in your office show that? — A. No, sir. 38 FAY. Q. That will appear. Do you know of any book in the Standard Oil Company's office that will show that? — A. No sir. Q. Well, your books do show, do they not, the number of 78 shares of the Standard Oil Company of New Jersey, common stock, which was issued for a given number of shares of these companies? — A. Yes sir. Q. And the basis of the exchange. That would show the basis of exchange, wouldnt it? — A. It would show that so many shares of common stock were issued for the stocks of twenty different com- panies as they would appear on the books or in the entry. Mr. Kellogg. I wish you would produce that book showing that basis of exchange, so that we can see exactly what it does show. (Certain papers were marked Petitioner's Exhibits 2 to 9, in- clusive.) Q. I show you statements, Petitioner's Exhibits 2, 3, 4, 5, 6, 1, 8, and 9. Will you please state what those are. — A. Those are balance- sheets of the Standard Oil Company of New Jersey for the years 1899 to 1906, inclusive. Q. Do you take off a balance-sheet each year, in your regular busi- ness ? — A. That is the balance-sheet made up for each year, yes sir. Q. Was this taken from a regular trial-balance book ? — ^A. No sir. Q. Do you have a trial-balance book which you take off each year ? — A. I have a trial-balance, which is taken off each year. Q. You have a trial-balance ? — A. Yes sir. Q. Is this a copy of the trial-balance for each year ? — A. Not Y9 a copy of it, but it embodies the figures on the trial-balance. Q. Is it made up in a different form from your regular trial-balances? — A. Well, it is arranged under the different classifi- cations. Q. Do these exhibits show the total assets and liabilities and in- come of the Standard Oil Company of New Jersey for each year, commencing with and includina; 1899, down to and including 1906?— A. They do. Q. They correctly show all of the assets of the company ? — A. Yes sir. Q. Taken from the original books, are they? — A. Yes sir. Q. Books of original entry? — A. Yes sir. Q. Kept in the usual course of business by the Standard Oil Com- pany of New Jersey? — A. Yes sir. Q. They also show in detail the stocks and securities of all com- panies in which the Standard Oil Company of New Jersey owns an interest? — A. They do. Q. And in detail, the intome from al] companies in which the Standard Oil Company, directly <»r indirectly, owns an interest?— A. Yes sir. Q. And they show the income, all the income, which the Standard Oil Company received during those years? — A. They do. FAT. 39 Q. I notice in the statements of 1902, 1903, 1904 and 1905 an item of income, " C. M. Pratt Investment Profits." Will you turn 80 to those? (Handing exhibits to the witness.) In 1902, let me add, it was $137,400.— A. Yes, I find such an amount. Q. What is that income? — A. I could not give you a positive re- ply on that point, Mr. Kellogg. Q. Have you no recollection ?— A. I have no recollection. Q. Did you look this statement over before it was produced?— A. Those figures were taken from the income statements made up at that time ; I was not an officer of the New Jersey Company at the time those were made up. Q. The books will show, will they not?— A. The books will show that item, yes sir. Mr. MiLBUEN. Just as it is there. Q. Wont the books show from what source that income was re- ceived — C. M. Pratt Investment? — A. I think they will. Q. Will you please look up those four years, 1903, 1904, 1905, and the year 1902, and give us the items constituting those sums and from what source it was received? — A. I will. Q. You were in the office in 1904? — A. Yes sir. Q. It was then $1,853,700?— A. It was, yes sir. Q. In 1905 it decreased to $137,350.— A. Yes sir. Q. And in 1906 it disappeared? — A. That is correct. Q. You have no recollection as to what those were? — A. No sir. My first answer would apply to all those items. Q. All right. Please look them up. Please turn to the years 1899 1904, inclusive. Central Trust Company certificates, $4,429,- 81 710.30, and explain what those certificates were. — A. I would prefer to answer that question also, ilr. Kellogg, after refer- ring to the record. Q. Well, cant you give us an explanation of it now? — A. I dont think I could give a clear explanation. It is not clear in my own mind just how that item came about. Q. Well, look at 1905 and see the item '' Contingent Account, $4,- 628,473.17."— A. Yes, sir, I see that item. Q. What is that? — A. The Standard Oil Company of N'ew Jer- sey purchased certain stocks during 1905. On December 31, when the books were closed, the book values of those stocks were $4,628,- 473.17 more than the purchase price. It was simply carried in a contingent account until it is proven whether that is an investment or not. It is contingent investment. Q. What are those stocks? — A. I couldnt say, couldnt give you the names of the companies that were involved. Q. Your books show, dont they? — A. The books would show. Mr. Kellogg. Please make a statement of the stocks which the Standard Oil Company acquired and which went into that contin- gent account, or any part of the price which went into the contingent account, of the stocks you refer to. Witness. Yes, sir. 40 FAT. Q. Do the names of the companies that you refer to, whose stocks were acquired, appear in that list? — A. Yes, sir. Q. Can you name them ? — A. I could not, accurately. Q. You could not accurately ? — A. I would prefer to give you the list, which I know will be correct. 82 Q. All right. Now, has that item any connection at all with the Central Trust certificates? — A. No sir. Q. None whatever? — A. None whatever. Q. ^Yhat became of that item of Central Trust certificates ?— A. I think those certificates were sold, but I would have to refer to the record to verify that, Mr. Kellogg. Q. You will?— A. Yes sir. Q. What were those certificates of — the Central Trust Company?— A. I could not say. Q. You dont know what they were based on ? — A. I would prefer to look that record up. Q. Didnt you examine these statements before they were brought here? — A. I did. Q. Did you look into those questions — those items? — A. Not those particular items which you have questioned about. They ap- pear on the records, and these are correct copies of the books or records. Q. Take the year 1899. I wish some explanation of that. It shows the gross assets of the Standard Oil Company of New Jersey as $200,79iVj23.G5, does it not?— A. Yes, sir. Q. It shows its total profits $34,420,314.24, does it not?— A. "What was that amount? Q. Will you please figure it up and see, because I want to ask you some questions about that full year. May Mr. Durand point them out? (Mr. Kellogg and Mr. Durand point out certain figures on 83 the paper before the witness.) Mr. Kellogg. Mr. Milburn, do you want to see this? Mr. EosENTHAL. We dont want to see it, but if Mr. Durand asks any questions we want to have him ask them loud enough so we can hear them, that is all. Mr. Kellogg. Certainly. Mr. MiLBUEN. I wouldnt Imow anything about it if I saw them. Mr. Kellogg. I suppose Mr. Fay and Mr. Durand could check them up, together. It would shorten this. I suggest that Mr. Fay and Mr. Durand check this up to see if it is correct. They say they can do it in a few minutes. Mr. Milburn. Suppose they go into the adjoining room and do it, and we may rest our weary minds. The witness and Mr. Durand retire to the adjoining room for the purpose of verifying the statements. Q. I show you a summary marked Petitioner's Ex. 10. Will you state whether this is a summary of the exhibits 2 to 9, inclusive, about which you have been testifying? PAY. 41 Mr. Rosenthal. In so far as the figures are concerned. Mr. Kellogg. Oh, certainly; so far as the figures are concerned. A. Those figures agree with the figures recorded on these state- ments. Q. Now, under the head of Capital and Scrip: does that 84 mean the capital and scrip each j^ear issued and outstanding, by the Standard Oil Company of New Jersey? — A. Yes sir. Q. That means their capital stock? — A. Yes sir. Q. And " Net Value of Assets during each Year," what does that mean? — A. Their assets as carried on their books. Q. Less their liabilities? — A. It does. Q. And those figures are the correct figures as shown by your statements there. Petitioner's Exhibits 2 to 9 ? — A. They are. Q. Gross assets, under the column of " Gross Assets," does that mean the gross assets of the Standard Oil Company of New Jersey, as carried on its books each year from 1899 to 1906, as shown by those statements? — A. It does. Q. " Profits of Standard Oil Company's Own Business ; " what does that mean? — A. That means the profits of their own refineries. Mr. Rosenthal. Louder, Mr. Fay. Witness. The profits of their own manufacturing plants and marketing stations. Q. The Standard Oil Companj^, besides holding these stocks of these various corporations, owns certain refineries and marketing sta- tions of its own? — A. They do. Q. Do you know, in a general way, Avhere they are? — A. Why, there is a large refinery at Bayonne and works at Communipaw, as well as distributing stations in the state of New Jersey. 85 Mr. Rosenthal stated that other witnesses would give this information, and Mr. Kellogg said he would not pursue it further at this time. Q. But this column means the income from all of the property, exclusive of its stocks and securities in other corporations? — A. Yes sir. Q. Then '• Dividends Received from Other Companies," under that column, is the dividends from its stocks which it owns, as shown by those statements ? — A. Yes sir. Q. " Increase or Decrease in Value," that means the increase and decrease in value of its assets as it appears on its books from year to year, does it not ? (The witness looks at the paper.) Q. Oh, increase and decrease in value of corporate stocks owned, as appears from its books? — A. Yes sir. Q. "Total Profits"— read the rest of that.— A. "Total Profits Including Increase in Value of Corporate Stocks." Q. Yes. That is, the total profits of the Standard Oil Company of New Jersey, as shown from its books and from the statements you have exhibited, Petitioner's Exhibits 2 to 9, inclusive?— A. That 42 FAY. is the total income of the Standard Oil Company of New Jersey, plus the increase in the value of the corporate stocks. Q. And the next one, " Dividends Paid," are the dividends 86 paid upon the Standard Oil Company stocks?— A. Yes sir. Q. Now, I notice in the year 1899 the gross assets (I gave it before) were $200,791,623.65 ; the total profits, including increase in value of corporate stocks, $34,420,314.24. Will you tell me for how many months of that year those total profits were included? I mean from the corporate stocks. — A. That only covers the com- panies exclusive of those acquired during that year. Q. That is, that income does not include any income from the com- panies acquired during 1899 ? — A. That is correct. Q. So that the income of the twenty companies — or nineteen com- panies (I beg your pardon) — most, of which stocks were acquired by the Standard Oil Company of New Jersey during that year, is not shown in that item ? — A. No sir. Q. Isnt it shown for the last half of the year? — A. This covers the entire year. Q. Well, no part of the income, then, from those stocks of the nineteen companies were included in that? — A. Only the dividends received from those companies while the stocks were held by the New Jersey Company. Q. But the increase in value in those stocks is not included? — A. No sir. Q. And the dividends paid during 1899, prior to June 19, would not be included ?— A. The dividends paid by the Standard Oil 87 Company during the entire year of 1899 are included in that item of $14,304,000. Q. That is the entire dividend they paid that year? — A. Yes sir. Q. But the total profits, including increase of corporate stocks, did not include all of the income from the nineteen companies for the year 1899, did it? — A. As I stated, only the dividends received from those companies. Q. That is it. And some dividends were paid by those companies during 1899, prior to the acquisition by the Standard oil Company?— A. I couldnt say. Q. Well, that would show on the books in your office, would it not? — A. It would show on the books of those individual companies, I would say. Q. Well, it would show on the books of the Trustees or the Liqui- dating Trustees of the Standard Oil Trust, wouldnt it? — A. It might. Q. The toial dividends paid, then, by the Standard Oil Company of New Jersey during the year 1899 were $14,304,188.50?— A. Yes sir. Q. And that is all they paid that yoai-. Now, the gross assets of the Standard Oil Company increased, from 1899 to 1906, from $200,791,623.65 to $371,664,531.69, did it not?— A. That is, the gross assets ; that is, from this item to that item ? FAT. 43 Q. Yes. — A. That is correct. Q. Now, during this year, to obtain this net value of assets, 88 3'ou deduct the liabilities outstanding, do you?— A. That is the way that figure is arrived at, yes sir. Q. The total profits during those years, as shown by this state- ment, were $490,315,934.68, were they not?— A. Yes sir. Q. The total dividends paid were $308,359,430?— A. Yes sir. Ex- cept I would like to correct that. Q. Yes.— A. That includes, in that question before the last, the increase in the value of the corporate stocks. Q. Very well. Of the sub-companies. — A. Yes sir. Q. Yes, I understand that. Now, does that include all special dividends and all dividends paid by the Standard Oil Company?— A. Yes sir. Q. Everything. You include in your books the increase of the value of the corporate stocks as a profit, on the books, do you not, every year?— A. We treat that as an asset; we show an increase in the value of our investments, if such profits exceed the dividends. Q. The capital stock of the Standard Oil Company of New Jersey was only increased from $96,998,612.34 in 1899 to $98,338,382.26 in 1906. That is correct, isn't it?— A. Including the scrip, yes. Q. You mean by " scrip " fractional shares? — A. Yes sir. Q. So then, the increase in the assets and the total profits came either from earnings of the company or from increase in the 89 value of its property by earnings of the sub-companies and not from any money paid in by the stockholders of the Stand- ard Oil Company? — A. I dont just follow that quetion, Mr. Kellogg. Mr. MiLBUEN. The stockholders paid in no money. Q. I say, the stockholders paid in no money from 1899 to 1906 at all, did they? — A. No sir. Q. There was a little stock issued for outside securities? — A. Yes sir. Q. But substantially all its increase in value of properties, in- crease in assets, and its total profits came from the profits of the busi- ness of the sub-companies, and not from any moneys paid in by stockholders ? Mr. Rosenthal. Necessarily. A. That is correct. Mr. Rosenthal. Is that necessarily profits? Mr. Kellogg. Yes. Mr. Rosenthal. Suppose there was a natural increase in the value of the property, a great deal of real estate, for example ; do you cover that all by your one word "profits?" Witness. No sir. The heading on that statement to which Mr. Kellogg is referring means the increase in the value of the corporate stocks as well. Mr. Rosenthal. Oh, you dont understand the question. Mr. Kel- logg is talking about profits, and you are talking about increased assets. Now, do you and he mean just the same thing? 44 FAY, Witness. Will you explain that a little more fully, Mr. 90 Kellogg? Mr. Kellogg. Yes. Mr. EosENTHAL. I Want to get Mr. Fay straightened out on that. In 1899 the total assets were how much? Witness. 200 millions. Mr. Rosenthal. In 1906 how much? Witness. That is there. Mr. Kellogg. Oh, you want this statement. Mr. Rosenthal. Excuse me for interrupting, ]\Ir. Kellogg. Mr. Kellogg. All right, go ahead ; no objection at all. Mr. Rosenthal. I want to see that we are together in our notion of the question. In 1906 how much ? Witness. 371 million. Mr. Rosenthal. Now, what does that difference represent? That is Mr. Kellogg's question, as I understand it. Where did that dif- ference come from? Witness. Well, that — do you wish me to answer you? Mr. Kellogg. Yes, go ahead and answer it; I have no objection. Witness. That difference represents the earnings of the New Jer- sey Company proper, plus the dividends which they have received from subsidiary companies, plus any increase in the value of the cor- porate stocks held by the Standard Oil Company of New Jersey dur- ing that period. Mr. Rosenthal. That is what I wanted, that last. Q. Now, of the increase in the value of the stocks held by 91 the Standard Oil Company, is stated in this statement, for instance, of 1906, to be "net increase in value of corporate stocks carried as investment, such increase being credited to uncol- lected earnings"? — A. Yes sir. Q. That means uncollected earnings of the subcompanies, does it not? — A. Yes sir. Q. So that all of this increase, every dollar of it, comes from either the earnings of the Standard Oil Company of New Jersey, or its sub- companies, really, directly ; is that not true ? — A. That is true. Q. Of course, it is. In other words, they do not take a stock and mark it up on the books, but they increase the stock of the sub-com- panies as its uncollected earnings show an increase in value ; isnt that correct? — A. I didnt just follow that, Mr. Kellogg, that last question. Q. Let me take that statement again. I want to clear that up. The increase in value here is not from marking up real estate, or any- thing of the kind, is it? It comes from the stocks of the sub-com- panies which the Standard Oil Company owns, does it not? — A. That last paragraph refers only to stocks of other companies. Q. Very well. The total profits, including the increase in value of the corporate stocks of the sub-companies, are increases in value on account of uncollected earnings of the sub-companies, are they not? — A. That is correct. FAY. 45 92 Q. Then it is true, is it not, that every dollar of the increase of assets of the Standard Oil Company of New Jersey during those years has come from its earnings or the earnings of its sub-com- panies? — A. From its own earnings. Q. Yes sir, or the earnings of its sub-companies? — A. Neces- sarily so. Mr. Kellogg. Yes sir ; that is what I thought. Mr. Kellogg. I offer in evidence Petitioner's Exhibits 2 to 9, inclu- sive, and Petitioner's Exhibit 10. Exhibit 10 is a synopsis of the others, of which I will furnish you, Mr. Milburn, a copy. Mr. MiLBTjRN. You might state in connection with Exhibit 10 that it is a synopsis of the figures in the others. Mr. Kellogg. Yes; Exhibit 10 is a synopsis, or a condensed state- ment, of the figures showing the assets and liabilities and total profits as shown on Exhibits 2 to 9, inclusive, and is offered in evidence in connection with those statements. Q. Mr. Fay, I show you a paper which purports to be a balance sheet of the Trustees of the Standard Oil Trust from December 31, 1882, for each year, down to and including 1891. Will you look that over? (Handing paper to the witness.) Run over each year, will you?' — A. (After looking at paper.) Do you want me to go through 'all this? Q. Yes, just look at each year? — A. Is there any particular 93 thing you want me to look into in regard to that ? Q. I wish to know if you have the books in your office from which those statements were compiled. — A. I dont think so, Mr. Kellogg. Mr. MiLBTjEN. We will tell you all that we have, Mr. Kellogg. Q. Well, you have books there. — A. I said I thought I had some books ; I was to report to you on that. Q. Now, where are the books of the controller's office of the Stand- ard Oil Trust period? — A. Why, I couldnt tell you, Mr. Kellogg; I dont know. Q. You have seen them, havent you ? — A. The books of the control- ler's office, was the question? Q. Yes sir. — A. There was no controller's office in that period. Q. Well, what was it called ? — A. Well, I dont know ; that was be- fore my time. Q. Very well. But you have some books there that ante-date your connection with the Standard Oil Company, havent you?— A. I think there are some records of that kind in my safe. Just what they are I could not say, without looking in the vaults. Q. Because it appears from your testimony that in the middle of 1899 the Standard Oil Company of New Jersey took over some stocks of existing, going concerns, a part of the income of which went 94 into their books and a part of which went into the comtrol- ler's books of the Standard Oil Company of New Jersey, doesnt it?— A. There were items taken upon the controller's books at that time, yes sir. 46 FAY. Q. Now, from what books were those items taken ? Mr. EosENTHAL. TMs witness didnt say that he took them. A. The items that were taken upon the Standard Oil Company of New Jersey's books were taken up from the balance-sheets rendered them by the different companies, not from books. Q. You have seen, have you, books which show the earnings and assets of these companies, these nineteen companies, prior to the Standard Oil Company's acquisition of their stock? — A. Books or statements. Q. Books or statements. Now, according to these statements, or copies that I have, it appears that there were balance-sheets kept by the Trustees substantially in the manner that you keep your balance- sheets; is that not true? — A. I have never seen such a balance-sheet or anything in that order which you produced there, Mr. Kellogg. I have no knowledge of any such paper being in existence. Q. You have no knowledge in what office the accounts of the Trustees were kept? — A. No sir, I have never seen a balance-sheet of that kind. Q. Who is there in your office whose term of service antedates yours ? — A. No one at the present time. Q. No one ? — A. No sir. Q. No one connected with the controller's office who worked there prior to 1899 ? — A. Except Mr. Brainerd. 95 Q. Except Mr. Brainerd ? — A. Yes sir. Q. And Mr. Brainerd is in Europe? — A. Yes sir. Q. Have you in your office any books which were kept by the Trus- tees, or under their direction — the Standard Oil Trust, or by the Liquidating Trustees of the Standard Oil Trust? — A. I may have some books; just what I could not say without looking into the vaults. They are books that I have had no occasion to refer to, or would have no occasion to refer to, if there. Q. Well, is there any other department of the Standard Oil Com- pany which would have such books? — A. I was not familiar, Mr. Kellogg, with the arrangement of the offices at the time those books were in active use ; I dont know. Q. Well, have you become familiar with it since? — A. No sir. Q. Have you learned anything about it since ? — A. No sir. Q. You absolutely know nothing about anything that occurred there or any books prior to the time you went to work ? — A. No sir. Q. You never had seen any such books ? — A. I never had occasion to use such books. Q. Have you ever seen such books? — A. I say I may have some records in my office, which I will look up. Mr. Kellogg. Mr. Milburn, I served a subpoena on Mr. Wade Hampton to produce the record books of the Trustees of 96 the Standard Oil Company under the agreement dated Janu- ary 2, 1882, and the amendment thereof, dated January 4, 1882, showing, for the full term of its existence, the proceedings at the several meetings of the said Trustees. Also the books, records FAT. 47 and accounts kept bj^ said Trustees, or under their direction, showing all stocks, bonds, and other securities of corporations and limited partnerships held by said Trustees under and by virtue of said agree- ments ; the date of receipt of the same ; and the final distribution and disposition made by said Trustees of said stocks and securities. Also like books of the Liquidating Trustees. Mr. MiLBUEN. Now, Mr. Kellogg, I am aware of that subpoena. Mr. Wade Hampton knows nothing at all about any such books. I have been inquiring. Today, after our adjournment, we were asking Mr. Fay in regard to any of those books. He told us he believed there were some books in that vault of the controller's office, and he is going to make a search, when we adjourn tonight, as to what books there are there, and you shall have a list of them tomorrow morning. Now there is the whole situation. Mr. Kellogg. That subpoena was served four or six weeks ago. Mr. MiLBUEN. Well, you have served a good many things, and we have made inquiries, and I have not been able to find out where those books were. That was the first information I had, was today. 97 Now, I will tell you all I learn and know. I cant tell you what I dont know, although I sometimes try to do that. Mr. Kellogg. It seems strange that somebody in connection with the Standard Oil Company cannot find or explain where the books are in four or six weeks. Mr. MiLBURx. Oh, it is no use repeating that statement, Mr. Kel- logg. You know when your subpoenas were served. Mr. Kellogg. Well, how long ago was it? Mr. MiLBUEN. Well, it maj^ be the time that you sa,j. We have been much more concerned about the other matters. Mr. Hampton is here. You have served him with the subpoena. You have not served Mr. Flagler. Perhaps if you should bring Mr. Flagler, he will tell you where they are. Mr. KELLOGG. Oh, he is in Europe also. Mr. MiLBUEN. No, he is not; I talked with him the other day. Mr. Kellogg. He was reported to us to be in Europe. Mr. MiLBURX. Mr. Flagler? Mr. EosENTHAL. No, he wasnt, never. ' Mr. MiLBUEx. I saw him here; I was talking with him. If you want him I will have him here any time. Mr. Kellogg. I want those books. I want to know whether you will produce them. Mr. MiLBUEN. I have made all the statement I am going to about that. I have told you what my information is, and to-morrow morn- ing I will produce a list of what those books are. 98 Mr. Kellogg. Produce the books themselves. I dont want a list, I want the books. Mr. EosENTHAL. Under the subpoena, he hasnt any right to make any such call at all, if our brother wants to be so exceedingly technical. 48 PAY. Mr. Kellocg. Well, you can refuse to produce them, if you want to. Mr. MiLBUEN. Now we will see when we get here tomorrow morn- ing whether we need to have any trouble about it or not. What I know about the books I will tell you, when I have found out. Mr. Kellogg. Well, I want to know whether you have seen your- self, Mr. Fay, any such books or not. Mr. MiLBURN. He said about four or five times Mr. Kellogg. Well, answer that. Witness. I think I have seen some of those books in my vault. Q. When did you see them ?— A. That I couldnt say. Q. Very well. Will you make a search for them, and produce what you have got* — A. I will make search, yes sir. Q. I show you a statement, Petitioner's Exhibit 11. Please state what it is. Mr. MiLBURN. Wh&t is that ? Is that something of ours ? Mr. Kellogg. Something you furnished. Mr. MiLBUEN. Sure to be right. It carries its own commenda- tion. 99 Q. Is this a list of stocks owned by subsidiary corporations of the Standard Oil Company, of New Jersey? — A. Not en- tirely. Mr. MiLBURN. And other corporations ; it says so. Mr. Kellogg. I said a list of stocks owned by the subsidiary cor- porations of the Standard Oil Company. Mr. MiLBUEN. Oh ! Mr. Kellogg. I think perhaps you didnt understand the question. Please read it. The question was read, and the paper was handed, back to the witness. Witness. Not entirely. Q. Perhaps I had better take each page, then. Page No. 1 shows a list of stocks owned by the American Petroleum Company? — A. Yes sir. Q. The American Petroleum stock is owned by the Standard Oil Company, isnt it? — A. A portion of it, yes sir. Q. The American Petroleum Company's shares are held, six shares by the Standard Oil Company, of New Jersey, and the balance by what company ? — A. I think a portion of the balance will appear as held by the Anglo-American Oil Company, on the statement which you have in your hand. Q. Yes. That is, six shares of the American Petroleum Company's stock is owned by the Standard Oil Company, of New Jersey, and the balance is owned by the Anglo-American Oil Company A. Not the balance; a portion of the balance. 100 Q. A portion of the balance ? And the Standard Oil Com- pany owns all but twelve shares and a fraction of the stock of the Anglo-American Oil Company? — A. That is correct. FAY. 49 Q. Then, the list which you have furnished shows the ownership of stock by conjpanies which the Standard Oil Company controls by stock ownership or by sub-companies of those companies ; is that true ? Mr. Rosenthal. The word " control " is rather misleading. Mr. Kellogg. Well, we will see about that. I dont suppose there IS much doubt, if it owns nine-tenths of the stock, it controls it. Mr. KosESTHAL. No. If it owns a very small percentage, there is a great deal of doubt about it. Witness. Some of these percentages are very small, much less than a control. Mr. Kell-ogg. In the statement which you are to furnish, I believe the total capitalization of all these companies will appear, will it not? I believe we asked for that, didnt we? I think it was asked for this morning. (No response.) Mr. Kellogg. Will you name in this list the companies in which they do not hold a controlling interest? I mean either the Standard Oil Company or some sub-company of the Standard Oil Company. Mr. MiLBUEN. Doesnt the list speak for itself? Mr. Kellogg. No, it does not. 101 Witness. This list shows the total capital, and also the American Petroleum Company's holding of that capital. This refers to the total capitalization of the company. In that case that is shown. Mr. Kellogg. Oh, that is not shown on the other statement. The total capital of these sub-companies, then, is stated, but not the total capital of the Standard Oil Company's holdings ? Witness. No sir. Mr. Kellogg. We offer this list in evidence, Petitioner's Exhibit 11. Q. This was compiled from books of original entry in your office ? — A. No sir. Q. Where did you procure this information? — ^A. That was com- piled from reports and other papers which were in our office. Q. Eeports from what companies — from these companies? — A. From the American Petroleum Company, for instance. Q. Well, then, this is compiled from original documents or books kept in your office, is it ? — A. Not at all from books, only from docu- ments. Q. Do you know this is correct ? — A. I could not swear to the cor- rectness of that, Mr. Kellogg. Q. Well, who can? Mr. MiLBtTEN. Well, you know it is a correct transcript of the papers in your office ? 102 Witness. I know that is a correct transcript of the papers which I have. Mr. MiLBUEN. Of the reports. Mr. Kellogg. And I want to show the correctness of this. 32555—08 4 50 PAY. Mr. MiLBUEN. That is what it is. He knows that is a correct transcript from the reports. Mr. Kellogg. Well, I dont want any objection to the source of the evidence. Q. Who can testify to the correctness of these items? — A. I could not say. Q. You know these are correct transcripts from the reports and books in your office ? — A. From the reports in my office, yes sir. Q. Well, now, you take the American Petroleum Company. Mr. EosENTHAL. Mr. Kellogg said the reports or books, and the witness answered " from reports in my office." Q. Where are the offices of the American Petroleum Company? — A. In Rotterdam. Q. Does the company report to the Standard Oil Company, of New Jersey? — A. I have in the controller's office of New Jersey reports from that company. Q. Showing its ownership of properties and stocks in other com- panies ? — A. Yes sir ; those figures were taken from that source. Q. Do you have the balance sheets of the American 103 Petroleum Company in your office ? — A. Yes sir. Q. Trial balances every year ? — A. I cant say that I have a trial balance, no sir. Q. Well, you have balance sheets? — A. I have had balance-sheets, yes sir. Q. Do you get them at regular times? — A. No sir. Q. How often do j^ou receive them? — A. Usually annually, as a rule. Q. What do those balance sheets show? — A. Well, similar infor- mation as I have furnished on those Q. But they show in detail, do they not A. The different classes of assets and liabilities. Q. Now, the Standard Oil Company, of New Jersey, receives from all companies in which it is interested directly or indirectly balance-sheets showing the principal items of its assets and liabil- ities, its gross and net profits, does it not? — A. No sir. Q. What companies does it not receive that information from?— A. Why, there are a number of companies in which the New Jersey is stockholder, which they do not receive. Q. Name them. — A. I dont know as I could name Q. Pick them out and name them. I want to know just what they are. — A. Well, the United Oil Company is one. Q. The United Oil Company is a Colorado Company, and the Standard Oil Company only owns about seventeen per cent of its stock; isnt that true? — A. They own about 34 or 31 104 (Mr. Kellogg hands paper to the witness.) Witness. 3401 shares. Q. And out of a total capitalization of how much? — A. I dont know what their total capitalization is. FAY. 51 Q. They dont own the control of that, do they?— A. No, I dont think so. Q. That is one company from which the Standard Oil Company does not receive balance-sheets of the kind I have designated ?— A. Yes sir. Q. What other companies ?— A. The Hazelwood Company is an- other. Q. The Hazelwood Company. What percentage of that stock does the Standard Oil Company own ? — A. I couldnt say ; they own 2511 shares. Q. You dont know what the total capital it?— A. I do not. Q. Name another company. — A. Well, there are a number of small concerns, like the Georgia Car and Manufacturing Company. Q. I want you to name every one of them.— A. The Georgia Car and Manufacturing Company. Q. Well, that is one you just named. — A. The Meeker Foundry Company. The Eichmond Chamber of Commerce. Q. Go ahead. What business is that company in ? (Laughter.) — ■ A. Well, we own five shares of that. I dont know just how. Q. Are you dealing in Chambers of Commerce? Go ahead. — A. Well, there is the Virginia Agricultural and Mechanical Society ; we have no balance sheet from that. Q. You have none from the Tidewater, have you? — A. No 105 sir. The Tidewater doesnt appear in here. There may be others, Mr. Kellogg, but I dont recall them without reference to the records. Q. The Tidewater stock is held by the Anglo-American, isnt it ? — A. I believe so, Mr. Kellogg. Q. Well, have you named the only ones that you now remember which did not send you at least annually balance sheets shoAving the assets, the liabilities, the gross and net profits? — Q. The only ones that I recall, yes sir. Q. Generally speaking, then, every corporation in which the Standard Oil Company owns stock, or owns it through some sub- company, sends balance sheets showing the principal items of its assets, its liabilities, and gross and net profits, to your office? — A. Generally speaking, although the term " gross profits " which you use I do not clearly understand. Q. Well, its assets; the principal item of assets and the liabilities and net profits, then? — A. That is clear. Q. Yes sir. — A. Yes sir. Q. And you have in your office those statements, those balance sheets? — A. Yes sir. Q. Have you ? — ^A. I have or have had. Q. Do you preserve them ? — A. Well, not always. They are some- times, after a time, destroyed. Q. What other reports do those sub-companies make to the Stand- ard Oil Company ? — A. I could not say. 52 PAY. 106 Q. No other reports in your office? — A. No other reports to my office. Q. Are those reports usually made more than once a year? — A. Some companies ; possibly semi-annually, at midyear ; not all. Q. I show you Petitioner's Exhibit 12-a and 12-b. Are thoee the statements of the gross assets, the liabilities and profits of each com- pany in which the Standard Oul Company owns stock and from which it receives balance sheets such as you describe; either the Standard Oil Company owning the stock directly or indirectly through some sub-company ? — A. Those figures were compiled in my office from rec- ords on file or records which I have. Q. And those records show the gross assets, liabilities and profits of each company for each year, and including 1899 ? — A. Yes sir, as reported to the Standard Oil Company of New Jersey. Q. Now, you have those original balance-sheets, then, from which this was made, have you? — A. Not all of them. You notice that there are some figures missing on those. Q. Yes. Wherever they are reported here you have them? — A. I think so. Mr. Kellogg. I would like those originals to check these up from. Will you please produce the original balance-sheets of these 107 companies from which these summaries were made ? Mr. Mil- bum suggests that if they can go right to work on some of these statements now it will expedite matters, and I think if that is the case we will adjourn at this time until to-morrow morning at 10:30. The hearing before the Special Examiner was accordingly ad- journed until the morning of Wednesday, September 18, 1907, at 10 :30. 108 Wednesday, Seftember 18, 1907, 10:30 A. M. The hearing was resumed at 10 :30 A. M. Clarence G. Fat, recalled as a witness on behalf of Petitioner, tes- tified as follows : Direct-examination (resumed) by Mr. Kellogg: Q. We left open some items yesterday for explanation for Mr. Fay to look up. The first item was the income from the C. M. Pratt Investment. In 1902 there appears as an item of income $137,400, C. M. Pratt Investment. Wliat is that? — A. The New Jersey books show that was received on November 6th and December 22nd of that year from C. M. Pratt. Mr. Rosenthal. Suppose you give Mr. Kellogg your statement that you have prepared there. WriNESS. There is a statement, Mr. Kellogg, showing all of those amounts as they appear in the different years. (Handing paper to Mr. Kellogg.) Mr. Kellogg. Please mark the statement. Statement produced by witness was marked Petitioner's Exhibit 13. FAY. 53 Q. Petitioner's Ex. 13 is the detail of the receipt of income in the C. M. Pratt Investment account, as it appears on the books of the comptroller of the Standard Oil Company of New Jersey, is 109 it? — A. That appears on the New Jersey general ledger. That is a transcript of the account, Mr. Kellogg. Q. Do you know anything about the source of that income? — A. Nothing more than appears on that statement. Mr. KJELLOGG. I offer this statement in evidence, Petitioner's Ex- hibit 13. Q. Now, where, on your balance sheet, is the corresponding asset of this C. M. Pratt Investment income ? — A. There is no correspond- ing asset that I know of. Q. Well, there is no way of getting at an income, is there, without some assets or some investment? (No response) Do you know of any way? Mr. Rosenthal. Mr. Pratt admitted yesterday while on the stand what that investment represented. This man does not pretend to know anything about it except that he has taken these entries from the books. It has been entirely covered by Mr. Pratt. Mr. Kellogg. Mr. Pratt was very hazy about his knowledge of that. Mr. Rosenthal. He was not at all hazy. He very openly and freely conceded it was Waters-Pierce stock that he held in the New Jersey company. There was not anything hazy about it. This in- vestment represented what he received as income from that stock. There isn't any mystery about it. Q. Well, this account ceased in 1905, did it? — A. Yes, sir. Q. There is nothing appears there since ? — A. No sir. 110 Q. You know of no assets on the books of the Standard Oil Company of New Jersey from which that income was received, do you? — A. No, sir. Q. Does the Waters-Pierce, (that is, the stock of the Waters- Pierce Oil Company) appear on the books of the Standard Oil Com- pany of New Jersey? — A. Not during the years specified in this balance-sheet. Q. Not during those years ? — A. No, sir. Q. Does it appear in the books of any of the subsidiary com- panies ? Mr. Rosenthal. Well, when, Mr. Kellogg? Mr. Kellogg. Since 1899. Witness. I have no knowledge of it. Mr. Mn^BUKN. At any time since 1899. Now, for instance, in the statements. Witness. What was the question, Mr. Kellogg? Q. Does the stock of the Waters-Pierce Oil Company which is owned by the Standard Oil Company of New Jersey, appear in any of the books of the Standard Oil Company, in your office?— A. Yes sir. 54 PAY. Q. AMiere?— A. In the Standard Oil Company of New Jersey's general ledger. Q. For what years 'I — A. I cant say positively. Q. Well, since 1899 ?— A. In 1907. Q. It does not in 1906 ?— A. No, sir. Q. Nor 1905 ?— A. No sir. 111 Q. Nor any other year since and including 1899? — A. I dont recall that it does. Q. Very well. A'Mien was it put on the books of the Standard Oil Company of New Jersey, in 1907 ? — A. I could not give you that date without referring to those books. Q. Will you please do so and furnish us the item ? Mv. MiLBUEN. Yes, he will. Witness. Yes, sir. Q. Now, then, during 1899 to 1906, inclusive, the Waters-Pierce Oil stock which was owned by the Standard Oil Company Mr. MiLBTJEN. Owned by Mr. Pratt. Mr. Kellogg. The AVaters-Pierce Oil stock (you may strike out "which was owned by the Standard Oil Company") does not ap- pear as an asset in the books of the Standard Oil Company of New Jersey ? Witness. I do not think so. Q. Well, it does not appear on any of the statements you have fur- nished us, does it? — A. I havent all the statements here, jNIr. Kel- logg. Q. Except— add to that : 1899. Mr. Rosenthal. Mr. Kellogg, on the list of securities which we furnished you we stated that that stoik was first turned over to the Standard Oil Company of New Jersey, on February 28, 1907, and it was then transferred to the Standard Oil Company of New Jersey. 112 Mr. Kellogg. Well, I am trying to find out where it was in the interim, when the Standard Oil Company got the income from it, why it was not carried on their book. Mr. Rosenthal. That was not what you were trjdng to find out just now. Q. Now, the stock appears as an asset, does it, in 1899, on your balance-sheet of the Standard Oil Company of New Jersey? — A. Yes, sir. Q. Very well. Read the item. — A. Waters-Pieri'c Oil Company, 2,747 shares, valued $3,067,S9'2,10. Q. Now, does it appear on any of tlie other balance-sheets of the Standard Oil Company of New Jersey, which you have, including the years 1900 to 1906?— A. No, sir. Q. Now, is there any item of assets which takes the place of the Waters-Pierce Oil stocks on any of those statements, or which in- cludes it? — A. Not that I have any knowledge of. FAY, 55 Q. Well, that stock did not disappear from the assets of the com- pany without something taking the place of it, did it— over three million dollars? Mr. MiLBURN. I think I will object to that question as not proper in form. Mr. Fay only knows ^vhat entries are on the books, and he has told what those entries are and he will give you whatever entries there are. Now, the arguments and the deductions from those en- tries are one thing. The question is objectionable in asking the wit- ness to argue. 113 Q. If the Standard Oil Company had that asset in 1899 and did not ha^■e it in 1900, the books should show what it re- ceived for it, shouldnt they ? — A. I cant say what the books show in regard to that. Q. Is that an answer to my question? Please read it. The last question was read. A. Yes, sir. Q. Now, do the books show that? — A. I cant tell without refer- ence to them. Q. Ibne you any recollection of it I — A. Xo, sir. Q. Can you tell from the balance-sheets furnished us for 1900 whether any item of the assets includes what was receiAed for that stock, if anything was received for it? — A. No sir. Q. Is it in the C. M. Pratt Investment ?— A. The C. M. Pratt In- vestment is an income accoimt. Q. Simply an income account. Is it in Accounts Receivable? — A. I could not say without analyzing that item. Q. Is it in the Central Trust Company certificates? — A. No sir. Q. Will you find out A. Yes sir. Q. What asset the Standard Oil Company received for the Waters- Pierce Oil stock, and in what accounts it was carried until it appeared again on the books in 1907? Will you do so? — A. If the books will show that, yes, sir. Q. Then, all you know of this C. M. Pratt Investment ac- 114 count is that the books of the Standard Oil Company show that the Standard Oil Company received in 190-2 fi-om j\Ir. Pratt $13T,-±00; in 1904 $1,099,200: in 190,-1 $1.S.").",,700; and the same year $in7.3:>0. Mr. DuitAAD. You did not read those quite right, Mr. Kellogg. You have got the years wrong. Mr. Kellogg. I may have. Witness. Yes, sir, those figures are correct. Q. How do these items come to your office for entry on the books?— A. Those were posted to that ledger account from the cash-book. Q. Who keeps the cash-book? — A. It is in the treasurer's depart- ment. Q. It is not in your department ( — A. No, sir. Q. The treasurer keeps the books showing the source of the income, does he? — A. He keeps the books showing the receipts of cash and disbursements. 56 FAY. Q. And the source of that income? — A. I could not say what his books will show. Q. Do you post from his books into yours, these items ? — A. Those items were posted from the treasurer's books. Q. Into your books ? — A. Into the New Jersey general ledger. Q. The New Jersey general ledger is kept in your office? — ^A. Yes, sir. Q. It is under your control? — A. Under my supervision. 115 Q. What is that item of Central Trust Company certificates that appeared on the books from 1899 to 1904? Have you a statement? — A. That will probably explain it better, Mr. Kellogg. (Handing Mr. Kellogg paper.). Paper produced by witness was marked Petitioner's Ex. 14. Q. Is Petitioner's Ex. 14 an explanation of the item of Central Trust Company certificates, Mr. Fay ? — A. Yes sir. Mr. Kellogg. I offer Petitioner's Ex. 14 in evidence. Q. In a general way, this shows that the stock and bonds of the National Storage Company were sold in exchange for Lehigh Valley Railway Company bonds, and that the stock and bonds were tempo- rarily deposited with the Central Trust Company and other certifi- cates received ; is that correct ? — A. This explanation as given here is in accordance with the entry on the new Jersey books. Q. You Iniow nothing about it beyond the books? — A. Nothing about it beyond the books. Q. The books show a sale of the National Storage Company stock and bonds, do they not? — A. Just as they appear there in that state- ment. Q. Well, that is what appears here, isnt it? — A. It shows that the National Storage Company stock and bonds were exchanged for Cen- tral Trust Company certificates. Q. Then what became of the Central Trust Company certifi- cates? — A. That statement shows they were exchanged for Lehigh Valley Railway Company bonds. 116 Q. $100,000 in cash and $5,000,000 of Lehigh Valley Rail- way bonds? — A. That is correct. Mr. Kellogg. I offer Petitioner's Ex. 14 in evidence. Q. The contingent account of $4,628,473.17 you were going to ex- plain. — A. Yes sir. Q. Does this statement show the stocks acquired by the Standard Oil Company of New Jersey, which figured in the contingent account in the statement of 1905 ? — A. No sir. Q. AVell, that is what it says on the heading? — A. I will correct that answer to Yes sir. Q. Yes, I thought you misunderstood me. The statement was marked Petitioner's Ex. 15. Q. That is, according to this statement, it appears that the Stand- ard Oil Company of New Jersey acquired the stocks of various corpo- rations named in Petitioner's Ex. 15 ? — A. Yes, sir. FAY. 57 Q. Do you know whether they were acquired from the National Transit Company? — ±\.. They were. Q. This account which you have given us does not show what the Standard Oil Company of New Jersey paid for the stocks? — A. It does not. Q. Wliat does this show? Mr. MiLBUEN. He stated that yesterday, didnt he ? Mr. Ejellogg. I dont think he explained it fully. He stated he preferred to explain it to-day. 117 Witness. I think I answered that question yesterdaj'. Mr. MiLBURN. He stated it exactly. Mr. Kellogg. AYell, I am not sure of it. It wont take but a mo- ment to explain it now if you have the statement. Q. Explain the whole transaction. — A. That amount represents the difference in the book value of those stocks on December 31 of the year in which thej' were purchased, and the price paid for same. Q. ^Y\leTe do you find the price paid for the stocks? Doesnt it appear on your balance-sheets there that you have? — A. No sir. Q. Where does it appear? — A. It would appear on the New Jer- sey books. Q. In your office? — A. Yes, sir. Q. Your statements show when they were acquired, do they not? — A. That statement vrill show, Mr. Kellogg, which you have at your elbow. Q. I know, but your balance sheet for each year will show whether those stocks appeared in the assets of that year? — A. Yes sir. Q. Therefore, will show that during that year they were ac- quired? — A. Yes, sir. Q. And will show the value of them, will they not ? — A. Show the value on the New Jersey books, yes sir. Q. They appear in the statements which you have, Peti- 118 tioner's Exhibits 2 to 9?— A. They do. Q. Take the Carter Oil Company. It appears in the state- ment of the assets for 1905, does it not?— A. Yes sir. Q. At a value of two million dollars ?— A. Yes sir. Q. Now, is it not a fact that the price paid by the Standard Oil Companv of New Jersey to the National Transit Company was $449,260!^17 more?— A. More than that? Q. Yes sir. — A. I think not. Q. You think not? Mr. MiLBTJEN. He dont know. What company is that ? Mr. Kellogg. The Carter Oil Company. Q. Then what is this $449,260.17 which enters into this contingent fund as an asset?— A. I stated that, Mr. Kellogg, in my previous answer. Q. Well, state it now as to that company.— A. It represents the difference between the book value of that company on December 31 and the amount we paid for the stock. 58 FAY. Q. Very well. That contingent account appears in that same statement, doesnt it ? — A. Yes sir. Q. And also $2,000,000 for the Carter Oil Company ?— A. Yes sir. Q. Then the Standard Oil Company must have paid the two mil- lion dollars and the four hundred forty-nine thousand added together, for the Carter Oil Company, didnt it ? — A. No, sir. Q. It did not? All right. Did they pay two millions for 119 it ? — A. I could not say without reference to the books. Q. You could not say? — A. No sir. Q. Do you know why all those companies were transferred from the National Transit Company to the Standard Oil Company of New Jersey? — A. I do not. Mr. Kellogg. I offer in evidence Petitioner's Ex. 15. Have you that capitalization of each company I asked for yesterday ? Mr. MiLBUEN. The capitalization of each company I asked for yesterday? (To the witness.) Have you got that? Witness. No sir. Mr. MiLBUEN. Well, you were going to get it. That was one of the things called for. Witness. Not in the list of questions I was furnished, no sir. Mr. MiLBTjEN. Number one, wasnt it ? Witness. No, that wasnt it. Mr. Kellogg. Mr. Pratt, perhaps. Mr. Chase. The request for each witness was put on a separate sheet. Mr. Kellogg. (To Mr. Pratt) I asked you for it yesterday. Mr. MiLBUEN. In the statement which was given under the head of Mr. Pratt it says " would like statement to include the total capi- talization of each company." Have you got a statement of that kind? Witness. No sir, that was not in the list of questions that was furnished me last night. 120 Mr. MiLBUEN. You can get up one. Witness. Showing the capitalization ? I have given a par- tial list. Mr. MiLBUEN. To them ? Witness. It is already an exhibit. Mr. Kellogg. Oh, yes, that is the sub-companies of the companies in which the Standard has stock. That is not the other. Mr. MiLBUEN. We can get that. Mr. EosENTHAL. I have no doubt we can get it without any trouble. Mr. Kellogg. Perhaps you can tell whether that list of capitaliza- tion is correct or not. (Handing paper to Mr. Milburn and Mr. Rosenthal.) Mr. Rosenthal. You mean of the nineteen companies? Mr. Kellogg. I havent got them all down there. Mr. MiLBUEN. You dont want it just now? I will see that you get it. FAY. 59 Mr. EosENTHAL. You can ask the witness, but I am quite certain he dont know it. Mr. MiLBUEN. I dont see how that slipped down. However, we can have that prepared. Mr. Kellogg. Perhaps Mr. Pratt can tell whether that is correct or not ; he is here. (Mr. Pratt is consulted by Mr. Eosenthal.) Mr. MiLBTJEN. I understood, in reading over, that there 121 was such a statement as that. I must have gotten it wrong. You will make that. It cannot be a difficult thing to get up the capitalization of each company. Mr. Kellogg. I wanted it this morning in the examination of Mr. Fay. It pre\^ents us getting this in in the regular order. Cant you telephone down to the office and have them make up that statement? Mr. Eosenthal. Who is there in the office that can do that in your absence, — anj^body? Witness. No one to make that statement. jSIr. MiLBUEK. The capitalization— do you mean the nineteen com- panies ? Mr. Kellogg. Xo, the capitalization of all the companies in which the Standard Oil Company owns stock which have not been fur- nished. Witness. In other words, that list which you have on your desk? Mr. Ejellogg. Yes sir, that list, Petitioner's Ex. 1. Q. Do you have the information in your office? — A. As far as possible I will furnish that. Q. Very well. Isnt there some one in your office that can be mak- ing up that now so that we can have it right after luncheon? Mr. Eosenthal. Do you want the capitalization of all the com- panies named on Exhibit 1 ? Mr. Kellogg. Yes sir. 122 Mr. Eosenthal. Is there any one there that can get that up ? Witness. I should prefer to do that myself, Mr. Eosenthal, if possible. Mr. MiLBUEN. I would prefer to get that information out, if pos- sible, myself. Q. Can you tell me if the capital of the Atlantic Eefining Company is $5,000,000? Mr. Eosenthal. There wont be the slightest objection on our part to your putting the information in the record at this point, so as to get a record that runs in the way that you want it to run. Mr. MiLBUEX. And we can correct it. Mr. Eosioxthal. Certainly. Mr. Kellogg. Very well. Then I will show him one of these statements, and then we will get the balance of it this afternoon. Mr. Eosenthal. Certainly. Paper marked Petitioner's Ex. 16. Q. Will you look at Petitioner's Ex. 16 and see if the capitalization 60 FAY. of the companies there stated is correct, as near as your recollection goes, subject to correction by a statement which you shall furnish? Mr. MiLBTiRN. It may be taken in the record, Mr. Kellogg, that that statement of the capitalization is correct, subject to our right to correct any errors that we may find. Mr. Kellogg. Very well. 123 Q. I show you Exhibits 12a and 12b. Will you take the At- lantic Refining Company for the year 1903, its capital appear- ing on this statement as $5,000,000 ; what dividends did it pay in 1903 to the Standard Oil Company of New Jersey? Mr. MiLBUEN. Now, I object to this question because it is in evi- dence in the statements. Why argue this case ? It is all in evidence here. If you have got an abstract, that can go in evidence. Isnt that so, Mr. Kellogg? Mr. Kellogg. Certainly. I will ask him. Mr. MiLBTTEN. He can only read from papers that he has in his hands. Mr. Kellogg. But those papers were not given to us in time. Mr. MiLBUEN. But you have got it there; you have got it all ab- stracted. Mr. Kellogg. I will ask him if that is correct, then. He will prob- ably say he will have to check it up. Mr. MiLBUEN. It will be just as short for him and Mr. Durand ■ Q. Is this statement correct of the dividends for 1903 and 1906, made up from the statements 12a and 12b ? Mr. Rosenthal. What is that ? a digest of the statements we have furnished you? Mr. Kellogg. Yes, it is a digest. Mr. Rosenthal. Why cant he and Mr. Durand check that up as they did the other? 124 Mr. Kellogg. I have no objection. I think they can do it in a very few minutes. Mr. Rosenthal. I think it will save time. Mr. MiLBUEN. That is the best way, and then it saves inquiring as to every item here. It will only talte you a few moments, I have no doubt. (Mr. Durand and Mr. Fay retire to compare the figures on the statements.) Q. Mr. Fay, I show you Petitioner's Ex. 16. Have you checked that up with the statements. Petitioner's Exhibits 12a and 12b? — A. I have. Q. As corrected by you now, does it show the capitalization (as- suming the capitalization to be correct) the dividends and profits for those companies for 1903 and 1906? — A. The dividends do not show on the exhibits 12a and 12b. Q. These are taken from what ? — A. Exhibits 2 to 9. Q. Those are correct, are they, as corrected? — A. They are in ac- cordance with the papers I have furnished. FAY. 61 Mr. Kellogg. Now, I offer this petitioner's Ex. 16 in evidence, and would like at this place to have inserted a complete exhibit showing all the companies and each of the years. Mr. Rosenthal. That is entirely agreeable. Mr. Kellogg. As this is only made up from partial information. The ExA5iixER. The understanding is that that shall go into the record at this point? 125 Mr. Kellogg. Yes, go into the record at this point. The ExAiNEiNEE. The stenographer will so understand: Mr. Kellogg. And we will OK the exhibit so that it will be accu- rate for all of the sub-companies and each of those years. Q. Will you turn to fhe statement showing the assets and liabili- ties and profits of the Standard Oil Company, of New York, for the year 1904, and also the statement of corresponding year of the Stand- ard Oil Company of New Jersey, in relation I mean to the Standard Oil Company of New York. Now, it appears, does it not that the Standard Oil Company of New York paid dividends of $32,998,430 to the Standard Oil Company of New Jersey? — A. Yes sir. Q. What were its net profits for that year? — A. As per Exhibit 12, $7,751,160 :58. Q. Now, that resulted in ^educing the net assets of the Standard Oil Company of New York from $40,425,900.13 to $15,179,706.42, did it not? — A. I would have to make some figures here to prove that, Mr. Kellogg. I can take them right off here. Q. All right. — A. Will you repeat those amounts, kindly. The question was read. A. The first amount is incorrect. Q. What is the first amount ?— A. $40,428,325.84. Q. All right. The second amount is correct? — A. The second amount is correct. 126 Q. Now, this was not due, was it, to any reduction of the gross assets of the Standard Oil Company ; it did not result in that ? The gross assets of the Standard Oil Company of New York in 1904 were more than they were in 1903, were they not?— A. Ac- cording to reports made by that company to the Standard Oil Com- pany of New Jersey. Q. State the gross assets for 1904.— A. As shown by this statement, $96,574,852.20. Q. And what were they in 1903 ?— A. As per this statement, $88,- 074,561.15. Q. So that during that year the Standard Oil Company's gross assets were increased very materially? Mr. Rosenthal. Have you got a copy of that statement in your pocket for me, Mr. Fay? Witness. No, sir, I have not. Q. What were the liabilities of the Standard Oil Company of New York in 1903?— A. As per this exhibit, $47,646,235.31. Q. What were they in 1904? — A. From the same source, $81,395,- 145.78. 62 FAT. Q. That was an increase of nearly thirty-four million dollars wasnt it?— A. $33,700,000 in liabilities. Q. Now, during that same year the Accounts Keceivable of the Standard Oil Company of New Jersey were increased nearly forty millions, were they not ? — A. The Accounts Eeceivable of the Stand- ard Oil Company of New Jersey show an increase in 1904 over 1903 of about thirty -nine millions. 127 Q. And the liabilities of the Standard Oil Company of New York increased nearly thirty-four millions, in the same year, as you have just stated? Mr. MiLBUEN. Yes. A. If that was the statement. Q. Yes. Now, what was the nature of those liabilities of the Stand- ard Oil Company of New York, those additional liabilities which were increased during that year? — A. I could only answer that ques- tioa ^y referring to the statements furnished me. Q. You mean by the balance sheet of the Standard Oil Company of New York?— A. I do. Q. Well, what was the nature of the increase of $39,000,000, in round numbers, of the bills receivable or accounts receivable of the Standard Oil Company of New Jersey, in 1904? — A. That would also require a reference to the books. Q. Well, you made up those statements there, didnt you? — A. I did. Q. You keep those books, — under your direction? — A. Under my supervision, yes sir. Q. You have no recollection of that item at all? — A. No sir. Q. Will you please look up those two items. Mr. MiLBTJRN. Yes. Q. And find out what the increase of the liabilities of the 128 Standard Oil Company of New York, in 1904 consisted of and what the increase of the accounts receivable of the Standard Oil Company of New Jersey, consisted of. The statements in your office show the details of the assets of the Standard Oil Company of New York, do they not? those balance sheets that you referred to yesterday ? — A. Not all the details. Q. They show the principal items? — A. I think they will Q. They would show, would they not, what those liabilities were? — A. I couldnt say. Q. Now, last evening we asked for the balance sheets of all the companies A. Yes sir. Q. In which the Standard Oil Company was the owner of stock or which reported or sent balance sheets to your office. — A. Yes sir. Q. Did you look those up? — A I am having them looked up. They are partially collected. Q. You have not had time to get them all together yet ? — A. No sir. Mr. MiLBUEN. We worked until pretty late last night PAY. 63 Q. Now, as to those balance-sheets from and including 1899 down to the present time, when will you have them so that we can look them over? Mr. MiLBUEN. Tomorrow morning, if you get away this afternoon ? Witness. I think I could have them by that time. It is 129 quite a task to get those papers out and in order for exami- nation. Mr. MiLBTJEN. Let him work this afternoon getting that matter together, and you can have them to-morrow morning. Mr. Kellogg. It has been suggested that they be examined there at the office, to sa\'e time, instead of examining them here in court. Q. Have you any of them ready so that an examination could commence on them this afternoon? — A. I think they will be. Q. Now, Mr. Fay, you were asked for certain statements of the stocks acquired by the Standard Oil Company of New Jersey during certain years. — A. Yes sir, I have such statements. Q. Will you let me take it please. The witness hands a statement to Mr. Kellogg, which was marked Petitioner's Exhibit 17. Q. I show you Petitioner's Exhibit 17. Is this a statement show- ing the amount of stock acquired during the years 1899, 1900, 1901 and 1904 of the twenty companies whose stocks appear in Petitioner's Exhibit 1 as having been acquired between June 19, 1899 and De- cember 21, 1904, from sundry parties? — A. It is. Q. No stocks, therefore, were acquired of those companies in the years 1902 and 1903 ? — A. As stated in that statement. Q. Well, that is correct, isnt it? — A. That is correct. Q. And in 1901 there was only one share of the National 130 Transit, and a fractional share, and certain fractions less than one share of the other companies ? — ^A. That is correct. Q. And in 1904, two shares and a fraction of the National Transit and certain fractions less than one share of the other companies ? — A. Yes sir. Q. So that substantially all of the stock which the Standard Oil Company of New Jersey now owns of those two companies was ac- quired in 1899 and 1900 ?— A. Yes sir. Q. I notice that the denominator of the fractional shares is stated at the top of the colmnn ; that is correct, isnt it ?— A. That is correct. Q. And the fraction is opposite each company? — A. Yes, sir. Q. It appears here that the Standard Oil Company of New Jersey acquired its own preferred stock in those years to the extent of 99,999 shares and a fraction, nearly another share. (Handing witness state- ment) . — A. That is correct. Q. The exact fraction is 972,500?— A. The exact fraction is 162,600/972,500. Q. It therefore appears that as to every one of these nineteen com- panies, excluding the Standard Oil Company of New Jersey, those stocks had been divided into fractions, or some of them, with 972,500 as the denominator ? — A. Yes, sir. 64 PAY, Q. You dont know the reason why that was done? — A. No sir. Q. Your books dont show that? — A. No sir. Q. At the time we adjourned last evening, I believe I was inquir- ing about the books in your office showing the assets, liabilities, 131 gross and net profits of the Standard Oil Trustees of the Standard Oil Trust and the Liquidating Trustees, from 1882 until 1899, at the time the Standard Oil Company acquired these stocks stated in this last exhibit. What books did you find? — A. I made a search of the safes of the office, a thorough search, and found a ledger backed " Standard Oil Trust, 1882." Q. How many years does that ledger cover? — A. I think to date. Q. To the present time? — A. " Cash and Journal B, Standard Oil Trust, 1888 to " ; " Cash and Journal C, Trustees to Liquidate S. O. T., July 1, 1896 to" date. Q. Those are the only books you found I — A. Those are the only books I found. Q. Did j^ou examine those books? — A. No, sir, not as to details, simply to see that they were the books that you were Q. Have you brought them with you? — A. No, sir. Mr. MiLBTJKN. I told him, Mr. Kellogg, that I would see you about examining them there, and that he need not bring them until I would see you. Mr. Kellogg. All right. Q. Do you know, in a general way, what those books show ? — A. I cant say that I do, Mr. Kellogg. Q. Have you ever looked at them until last night? — A. Yes. Q. Do you know whether they show the assets of the companies in which the Standard Oil Trust owns stock? — A. I could not say. Q. Or the liabilities and the gross and net profits? — A. I dont think they would. 132 Q. You dont think they would ?— A. No. Mr. MiLBURN. But you dont know? Witness. No, I dont know. Q. They would show the gross and net profits and liabilities of the Trustees, would they? — A. I dont know what you mean by gross profits, Mr. Kellogg. Q. Well, your statements that you have given us show gross prof- its? — A. No, sir. Q. I mean gross assets, I beg your pardon. The total assets.— A. I could not answer that question. Q. You dont know. Did you find in your office any balance sheets of any of these companies stated in Exhibit 17, being the nineteen companies the stock of which was held by the Standard Oil Trust?— A. I ha\e given you figures taken from those balance sheets. Q. I mean during the years 1882 to 1899.— A. No, sir. Q. Did you make a search for such statements ?— A. I did not. Q. Will you do so ?— A. Yes, sir. FAT. 65 Q. I understood you yesterday that there might be some of those statements there. Have you seen any of those statements? — A. Not that I recall. Q. Have you ever seen any statements or balance sheets of any of those companies stated in Exhibit 17 in your office, of a date prior to 1899 ? — A. I may have, but do not recall any particular balance. Q. Have you used any such statements in making up any 133 settlements for those years? — A. I possibly haxe. Q. Well, have you made no examination for them ? — A. No, sir. Q. No recollection of seeing them ? — A. No, sir. Q. Well, you keep all the balance sheets of the companies sent to your office now, do you not? — A. Of recent date. Q. You have kept those back to 1899, haveut you? — A. I do most of them ; some figures in these statements are blank. Q. I show you what purports to be a balance sheet of the Standard Oil Company interests December 31, 1892, and the same for the years 1893, 1894. 1895 and 1896, during the period of liquidation by the Liquidating Trustees of the Standard Oil Trust. Will you examine them? (Handing paper to the witness.) Have you seen any state- ments in that form covering those years ? — A. I have not. Q. Or substantially that form? — A. No sir. Q. Or from which those figures could be taken? — A. No sir. Q. Or any books from which those could be made up ? — A. Unless it was the ledger I have just mentioned. Q. Will that ledger show these facts, these figures ? — A. I could not testify. 134 Q. Have you looked at the ledger enough to say whether it shows the balance of the trustees substantially as your ledgers do now? Mr. Rosenthal. If Mr. Durand will go down with Mr. Fay during the noon recess, he can look at that ledger. Mr. MiLBURN. Thej^ can arrange upon a time, and go down and see what is in the ledger. Mr. Kellogg. All right. I withdraw the question. Q. Have you ever seen any statements from the Tidewater Pipe Company or the Tidewater Oil Company ? — A. I have not. Q. None furnished your office? — A. No, sir. Q. Since you have been there? — A. No, sir. Q. Never have seen any ? — A. Never have seen any. Q. No balance sheets of that company?— A. No sir. Q. Have you seen any such statements of the Waters-Pierce Oil Company? — A. No, sir. Q. No trial balance or balance sheet showiiiL': the assets A. No, Sir. Q. And liabilities of the Waters-Pierce Oil Company?— A. No, sir. Q. Why does not your office have the same information as to the Waters-Pierce Oil Company which it has as to other companies in which the Standard Oil Company owns stock ? — A. I do not know. 32555—08 5 66 FAY, Mr. MiLBUEN. (Laughing) Go and ask Pierce. 135 Q. Have you had any such statements from the Corsicana Refining Company? — A. No, sir. Q. Has any item of income from the Corsicana Refining Company entered in to the gross income of the Standard Oil Company of New Jersey since 1899 ? — A. I have no knowledge of it. Q. Would you know it if it had ? — A. If it appeared in the state- ments. Q. If the income from the Corsicana Refining Company goes di- rectly to the Standard Oil Company of New Jersey, you would know it, would you? — A. I would. Q. And it does not ? — A. No, sir. Q. If the income from the Corsicana Refining Company goes to any of the sub-companies of the Standard Oil Company of New Jersey, you would know it, would you ? — A. No, sir. Q. Unless it appears in their balance sheet ? — A. I would not. Q. And you have never seen anything of their balance sheets, of these companies, to indicate one way or the other whether the income of the Corsicana Refining Company enters into any of the income of the sub-companies? — A. No sir. Q. Do you know anything about the business of the Corsicana Re- fining Company? — A. I do not. 136 Q. Do you know Mr. H. C. Folger ?— A. I do. Q. What is his business ? Mr. MiLBUEN. You have got that, havent you, Mr. Kellogg ? Didnt Mr. Pratt tell you who Mr. Folger was. his connection with the com- pany? Mr. Kellogg. He said he was an expert, East Side Refinery. Witness. I know he is connected with our refinery — with some of our refineries. Q. Do you know he is a partner of the Corsicana? — A. I do not. Q. Who is Mr. C. N. Payne? What is his business.?— A. Mr. C. N. Payne, I do not know. Q. You do not know. Has any item of income of the Security Company entered into the income of the Standard Oil Company, of New Jersey, since 1899 ? — A. Not to my knowledge. Q. Well, would you know it? — A. Yes, sir. Q. If it came directly to that company, you would know it? — A. Yes sir. I would change the answer to that first question, Mr. Kel- logg: No, sir, with your permission. Q. Yes sir. No objection. It could not be covered up in any other item of income? — A. No sir. Q. But if it came to a sub-company of the Standard, you might know it? — A. I would only know it if they reported it. Q. Do you receive any statement from the United Oil Company, of Colorado? — A. No, sir. Q. Never have since 1899 ? — A. No, sir. 137 Q. I mean statements of assets or liabilities or gross and net profits. — A. I have never received such statements. FAY. 67 Q. The Standard receives the dividends, does it? — A. They do. Q. But no statements as to its earnings? — A. IS^o sir. Q. Does the comptroller's office have charge of the contracts of the Standard Oil Company? — A. No, sir. Q. Explain exactly what books the comptroller's office keeps. — A. The comptroller's office simply has the supervision of the accounts of the company. Q. "What accounts of the company? All of them? — A. All ac- counts of the company ; of the company proper. Q. It does not keep all the books of the company ? — A. No, sir. Q. What books does it keep ? — A. Only the general books. Q. What do you mean by general books; explain them. — A. I mean books in which we carry the items of plant investment and Q. Of the Standard Oil Company of New Jersey? — A. Of the Standard Oil Company of New Jersey. Q. Yes, sir. — A. And its stock investments;. Q. And its stock investments? — A. Yes. Q. Is that all? — A. It would have accounts with the different de- partments of that company. Q. What is that? — A. It would carry the general accounts of the different departments of that company. 138 Q. The general accounts with the different departments of the Standard Oil Company? — A. Of the different depart- ments of the Standard Oil Company, of New Jersey. Q. Yes, that is what I mean. That is, your office carries the ac- count with the different departments of the Standard Oil Company of New Jersey ? — A. Yes, sir. Q. Now, explain those accounts ; state what they are. Mr. EosENTHAL. The statement showed, I thought, that was fur- nished you, generally. A. They are simply current accounts; nothing more. Q. Well, what do you mean by current accounts — with the differ- ent departments of the Standard Oil Company of New Jersey ?— A. The Standard Oil Company of New Jersey have a manufacturing department. Q. Yes, sir. — A. They also have a cooperage department. Q. Yes, sir. — A. They also have a marketing department. Q. Yes sir. — ^A. The general ledger simply carries one account with each of those departments. Q. Now, with the sub-companies, what books do you keep?— A. No books. Q. All you get is the balance sheets of the sub-companies?— A. Yes sir. Q. Oh, you enter the result of those balance sheets in your books?— A. I do. Q. In your ledgers?— A. Yes, sir. Q. Do you enter them in detail?— A. No, sir. 68 PAT. 139 Q. You receive them in detail and enter them in condensed form? — A. In totals. Q. In totals? — A. Yes sir. Q. The statements, then, which you furnished us, Exhibits 2 to 9, are made from those balance sheets, and not from your ledger? — A. That is incorrect ; the statements 2 to 9 are made from the ledgers. Q. The statements, Exhibits 2 to 9, were made from the ledgers kept by the Standard Oil Company of New Jersey, in your office? — A. That is correct. Q. Now. the balance-sheets from the sub-companies are in much more detail than those ledgers, are they not? — A. The balance-sheets would show the different divisions of their assets. Q. It would show the details of the bills receivable and accounts receivable? — A. Only in totals. Q. The balance-sheets do not? — A. No sir. Q. Are the balance sheets more in detail than the ledger from which those statements are taken? — A. They are. Q. In what respect? — A. They will show the different classes of assets. Q. The different classes of assets; of the income also? — A. They would show the net profits for a given term. Q. Do they show the income from the different sources of the sub- companies? — A. I could not answer that without referring to them. 140 Q. Now, your books of the Standard Oil Company of New Jersey show the details of its bills and accounts receivable, or only the balances? — A. Not all the details. Q. They show some of them? — A. Some of them. Q. \Miere are the details of their accounts receivable and bills receivable, of the Standard Oil Company of New Jersey? — A. Some of them would be carried on the department books which I men- tioned. Q. And balances furnished to you? — A. And balances furnished me. Q. Some of them are carried on your books, are they? — A. Some few, possibly. Q. Do your books show from what department this information is received? — A. The books would not give that information. Q. The books would not? You Icnow yourself, do you? — A. Yes, sir. Q. Now, from what departments of accounting in the Standard Oil Company of New Jersey do you receive information to enter in your books? — A. From all departments of that company. Q. Well, name them. — A. The manufacturing dejjartment. Q. Who has charge of the books in the manufacturing depart- ment? — A. Who has charge of the books? I couldnt say, Mr. Kel- logg- Q. You dont know who the book-keepers are? — A. No, sir. FAY. 69 141 Q. Or who the head of that department is? — A. I do not. Q. Who furnishes you the information? — A. It comes from that department, from that office. Q. In statements? — A. In statements, yes sir. Q. Where is that office — 26 Broadway ? — A. 26 Broadway. Q. You dont know who is in charge of it ? — A. A gentleman — Mr. Freeman is in charge of the office. Q. Mr. Freeman, what is his first name? — A. I dont know as I can answer that. Mr. MiLBURN. Well, you can find out. Q. Now, what other department? — A. We have a department in Baltimore. Q. What is that department? — A. It is known as the Baltimore division. Q. Of manufacturing? — A. Of manufacturing and marketing. Q. Manufacturing and marketing? — A. Yes, sir. Q. "V^^o is in charge of that department ? — A. I dont know who is in charge. Q. From whom do you receive your statements? — A. I couldnt say from whom I receive those statements, Mr. Kellogg. Q. Dont you correspond with somebody in that office? — A. I cor- respond with the manager of that division. 142 Q. Who is he?— A. Mr. Goodwillie. Q. What is his first name? — A. Mr. Thomas Goodwillie. Mr. MiLBUEN. How do you spell his last name? Witness. Goodwillie. Q. He is the man you correspond with? — A. Yes, sir. Q. He has general charge? — A. Yes, sir. Q. Now, what other departments? That includes the sales depart- ment as well as manufacturing, does it? — A. Yes sir. Q. What other departments do you receive statements from? — A. I receive statements from our refinery at Parkersburg, West Virginia. Q. Manufacturing, or A. That is manufacturing, yes, sir. Q. Who is in charge of that? — A. I only know the refinery man- ager at that point. Q. What is his name ?— A. Mr. Black. Q. You dont know his first name? — A. No, sir. Q. What other departments do you receive statements from ? — A. I receive statements from the — I think I have covered the New Jersey Company. Q. You have covered it? — A. No, I mentioned the Mr. MiLBURN. You have got Parkersburg and Baltimore and the manufacturing. Witness. And the manufacturing. Mr. MiLBUEN. Are there any others ? Witness. Yes, we have Mr. MiLBTJEN. Let's have them all. 70 FAT. 143 Witness. We have a marketing department. Q. Of the Standard Oil Company of New Jersey?— A. Yes, sir. Q. Who is in charge of that ? — A. Mr. H. C. Arnold. Q. Is that the marketing department of the Standard Oil Com- pany, of New Jersey, proper, or does it include other companies? — A. That is the Standard Oil Company of New Jersey, proper, I am referring to. Q. Do they ha^e a marketing department of the other companies there at 26 Broadway? — A. I believe there are some marketing de- partments; there are other marketing departments. Q. Wliat are they ?— A. The Standard Oil Company of New York have a marketing department. Q. "V^Tio is in charge of that ? — A. That, I believe, comes under the same management. Q. Mr. H. C. Arnold?— A. Mr. H. C. Arnold. Q. What other marketing departments do you have there ? — A. No others. Q. Do you know Mr. Bemis? — A. Yes, sir. Q. What is his full name ? — A. I could not give you his full name. Q. W. E. Bemis? — A. W. E. Bemis is correct. Q. What is his business? — A. I believe he is connected with the export department. Then you have an export department, have you? A. The Standard Oil Company of New Jersey? 144 Q. Well, any of the companies ? — A. The Standard Oil Com- pany of New Jersey has no export department. Q. The Standard Oil Company of New jersey has no export de- partment? What companies have? — A. I dont know as I could answer that question, Mr. Kellogg. I am not familiar with all the arrangement of departments outside of the Standard Oil Company. Q. There is an organization down there called the export depart- ment, is there?— A. I dont know that that is the title of the depart- ment. Q. What is the title ? — A. I dont know as there is any title. Q. Well, what is Mr. Bemis, what are his duties, — A. I dont know; I dont think he has been — I havent seen Mr. Bemis in a year or more. Q. Do you have any other marketing departments, organizations, in the Standard Oil organization down there? — A. In the Standard Oil Company of New Jersey? Q. Any of them in that building. — A. I dont recall now. I think I have given you Q. You recall no others. Do you have any other departments that you know of in that organization from which you receive any state- ments whatever ?^A. Are you referring to the New Jersey Company, Mr. Kellogg, or all the companies? Q. Any of the companies connected with tliis organization from which you receive any statements. — A. I may receive other 145 statements, but I PBATT. 71 Mr. EosENTHAL. But you what ? Finish your answer. Witness. I was going to say I might receive other statements, but I dont recall now just what statements. Q. "Well, you receive from the treasurer's office, do you not? — A. No, sir. Q. Dont you receive any statements whatever from the treasurer's office, or any condensed statements for yoiu- books, or statements in detail for your books? — A. I may receive some statements from the treasurer's office; just what statements I Q. You couldnt say ? — A. I couldnt say. Mr. Kellogg. I suggest a recess until 2 o'clock, as Mr. Durend is going down with Mr. Fay to look at those books. (A recess was here taken until 2 o'clock P. M.) 146 Afternoon Session. The hearing was resumed at 2 o'clock P. ]M. C. M. Pratt, recalled as a witness on behalf of petitioner, testified as follows: Direct examination (Resumed) by Mr. Kellogg: Q. I show you Petitioner's Exhibit 13 which purports to be the in- come received by the Standard Oil Company of Xew Jersey from the C. M. Pratt Investment Account. Do you know whether that is all receipts of dividends from the Waters-Pierce stock? — A. That is what I believe it to be, sir. Q. Those dividends during that period passed through your hands, did they ?— A. They did. Q. Was the stock during that time in your name? — A. It was not. Q. In whose name was it ? — A. In Mr. Pierce's name ; H. C. Pierce. Q. In H. C. Pierce's name; H. Clay Pierce, of St. Louis? — A. Yes, sir. Q. He is the president (or was) of the Waters-Pierce Oil Com- pany ?-^A. Yes, sir. Q. Were the stock certificates in your possession? — A. Yes sir. 147 Q. Or were they ? — A. Why, that is my impression of it, Mr. Kellogg. Mr. MiLBUEN. Were they endorsed? Will you ask him that? Were they endorsed in blank ? Witness. They were negotiable certificates in my possession. Q. Endorsed by Mr. Pierce and delivered to you? — A. That is right. Q. When they were issued in the new Waters-Pierce Company they were issued in <;he name of H. Clay Pierce and endorsed in blank and delivered to you, were they ? — A. No, sir, they were not. Q. HoAv were they issued? — A. I dont know; I bought the certifi- cates in the fall of 1900. 72 PRATT. Q. You bought the certificates ui the fall of 1900?— A. Yes, sir. Q. Prior to 1900, there Avas another Waters-Pierce Company, wasnt there? — A. Yes, sir. Q. Organized under the laAvs of what state? — A. "Well, I suppose Missouri, Mr. Kellogg; I am not sure. Q. AYell, it doesnt make any difference. Mr. MiLBLTRX. Was it Texas* Mr. Kellogg. Texas, I think. Q. It had the same capital stock as this Waters-Pierce Company? — A. It did. Q. $400,000 par value?— A. Yes. 148 Q. The Standard Oil Company of New Jersey owned 2747 shares of that stock, did it not, the first company ? — A. That is my recollection of it. Q. That companjr was ousted from the state of Texas in 1900, wasnt it ? — A. I am not sure of the date, Mr. Kellogg. Q. Well, about that time ? — A. Yes, about that time. Q. And the Waters-Pierce Company, in which you held this stock, was organized about in 1900? — A. Yes, sir. Mr. MiLBTJEN. In May, I think. Mr. Kellogg. In May, 1900? Mr. MiLBUEN. In May, 1900. (To the witness) Will you speak up, Mr. Pratt, and not answer by nodding your head. Q. Now, in the statement of the Standard Oil Company of New Jersey, of December 31, 1899, the Waters-Pierce Oil stock of the first company appears as an asset, 2747 shares, does it not? (Hand- ing witness paper) — A. That is right. Q. It does not appear again in the statements or balance sheets of the Standard Oil Company until 1907, does it? Mr. MiLBUEN. Well, you can assume that it does not. Witness. I dont know. Mr. MiLBUEN. Pie need not look through those, Mr. Kellogg; you know it does not. He can say so. Q. It does not, does it? — A. If the account says it doesnt, it does not, Mr. Kellogg. I am not familiar with the account. Q. Well, that is the way it appears. "Wlien the new company was organized, the Standard Oil Company of New Jersey, 149 received the same number of shares that it had in the old company, didnt it? — A. That is my recollection. Q. Yes, sir. — A. Not when it was organized, but the date there, as I explained. I bought the stock in the fall. Q. Well, the company Avas organized in the summer of 1900, was it not? Mr. Rosenthal. In May. Witness. In the spring. Q. In May of 1900?— A. Yes, sir. Q. The Standard Oil Company received in your name, or in the name of Mr. Pierce, endorsed in blank to you, the same number of PBATT. 73 shares it had in the old company, didn't it ? — A. It did not. I know nothing about that matter. I bought the stock. Q. You know nothing about it? — A. No. Q. You got the same number of certificates in the new company that the Standard Oil Company of New Jersey had in the old com- pany, didn't you?— A. I bought the same number of shares; I dont know about the certificates. Q. Did you pay for them with your own money ? — A. I did. Q. How much ? — A. Two hundred, seventy-five thousand and odd dollars. Q. And you owned them, did you?— A. I did, for the interest of the Standard Oil Company. Q. Yes ; you owned them for the Standard Oil Company, of 160 New Jersey? — A. Yes, sir. Q. You were a mere trustee? — A. That is correct. Q. You got none of the income personally, did you ? — A. I did not. Q. What did you give the Standard Oil Company to represent that interest ? — A. I dont remember that I gave them anything. Q. Why did you take them in your name? — A. I know of no definite reason, Mr. Kellogg, except as a facility in carrying on the business of the company. Q. Why could not the Standard Oil Company take those shares in the new company just as well as the shares in the old company? — A. I dont know. Q. You never heard any reason given? — A. I dont recall any. Q. Did you not consider it peculiar that you should hold shares paying more — or equal to a million eight hundred fifty-three thou- sand dollars income per annum, in your name? — A. Not peculiar, no sir. Q. Is there any other instance in all of the holdings of Standard Oil Company where you held or anybody held stock in that man- ner? — A. I dont recall. Q. You dont recall any? — A. No, sir. Q. You know of no reason why it was taken in your name? — A. Simply as a convenience to the company. Q. Why was it a convenience? — A. I know of no special reason. They trusted me and I trusted them, and it was an act of conven- ience. 151 Q. ^Yhy was it necessary to trust you? — A. I dont know why it was necessary. Q. Well then, why was it an act of convenience? (No answer). Was it not to avoid the anti-trust laws of Texas? — A. I dont know of anj' such rea.son. Q. You have not heard of such a reason ? — A. I have not. Q. Does the Standard Oil Company own the stock in any corpo- ration or any interest in any doing business in Texas? — A. I know of none^ Q. Except the Waters- Pierce ? — A. Yes, sir. 74 PEATT. Q. You gave the Standard Oil Company no declaration of trust, agreement, or obligation for those shares ? — A. I did not. Q. The income as received Avas paid over by you to the Standard Oil Company of New Jersey? — A. It was. Q. The shares stood on the books of the Waters-Pierce Company then in the name of H. Clay Pierce, when they were first issued ?— A. I believe they did, yes, sir. Q. How long did they so remain ?— A. I think for several years. Q. When were they transferred into any other name? — A. I do not recall. Q. Were they so transferred ?— A. They were ultimately, yes, sir. Q. To whom? — A. I think the stock went into the name of M. Van Buren. Q. N. M. VanBuren ? — A. Yes, sir. Q. Who is he?— A. He is a resident of New York City. Q. Connected with the Standard Oil Company? — A. In no way. 152 Q. In no way. Why was the stock transferred from you to Mr. VanBuren ? — A. I sold it to him. Q. You sold it to him ? — A. I did. Q. For cash? — A. I did, and a note. Q. For cash? — A. For cash and note, I said. Q. How much did Mr. VanBuren pay you? — A. Something over four million dollars. Q. Four millions of dollars? How much in cash? — A. Hundred and fifty odd thousand. Q. The balance in a note? — A. Yes, sir. Q. Made by whom? — A. By himself. Q. What did you do with the money and note ? — A. Why, I turned in those receipts to the Standard Oil Company. Q. The note and the money? — A. I turned in whatever moneys came on account of the note, to the Standard Oil Company. Q. Well, did you turn over the note to the Standard Oil Com- pany ? — A. That stood in my name still, sir. Q. Did you endorse it over to the Standard Oil Company? — A. I did not. Q. Does it still stand in your name? — A. No, that has been can- celled. Q. When was it cancelled ? — A. I dont remember the exact date. Q. Was it paid in full ? — A. Practically so : not in full. Q. Can you get the date on which that transfer was made to Mr. VanBuren, and the note and cash taken in payment? — 153 A. The stock was taken in 1904, I dont remember the exact date; that was the date of the note. Q. That is, the stock was turned over to Mr. VanBuren in 1904? — A. Yes, sir. Q. And that was the date of the note? — A. Yes, sir. Q. And during 1904 was the time the money was paid upon it? — A. That is correct. PBATT. 75 Q. Can you get the exact dates? — A. (Eef erring to memorandum) It was in March, 1904. Q. How long did Mr. VanBuren keep the stock?— A. I dont re- member exactly ; two years, possibly, or thereabouts. Q. When was the note payable? — A.' I dont remember the exact statement ; I think it was on demand, but I am not sure. Q. How long did Mr. VanBuren keep the stock? About two years? — A. I should say that. Q. Then turned it over to the Standard Oil Company, of New Jersey? — A. Yes, sir. Q. Now, who is Mr. VanBuren? — A. He is a resident of New York City. Q. Has he any business relations with the Standard Oil Company whatever? — A. None that I know of. Q. Do you know of any reason why the Standard Oil Company should sell that stock to Mr. VanBuren in 1904, take his note for it, most of the payment, and 154 Mr. MiLBTjBN. He says he sold it, Mr. Kellogg. Not the Standard Oil Company. Mr. Kellogg. Very well. Q. And buy it back from him in 1907 or 1906? — ^A. He was abun- dantly able to do such a thing as that. Q. Do you know of any reason why the Standard should part with that stock or the beneficial ownership thereof ? — A. Only as a matter of business transaction with Mr. VanBuren. It was between myself and Mr. VanBuren. Q. Very well, but you didnt own the stock ? — A. No. Q. You simply held.it for the Standard Oil Company? — A. That is correct. Q. Now, you got how much for it? — four millions? — ^A. I did. Q. Just even four millions ? — -A. No, something over four millions. Q. The stock was then paying the Standard Oil Company over $1,800,000 a year, wasnt it? — A. I dont remember the exact amount, sir. Q. $68,700 a month, isnt it ? — A. I have only this record. I dont remember what the Q. Well, can you tell from that record? — A. This is only for the years 1903 and 1904. Q. Very well. In 1904 how much was that stock paying the Stand- ard Oil Company?— A. $1,853,000. Q. And what was the par value of it? — A. $100. 155 Q. And how much par value— twenty-two hundred and seventy something thousand ? — A. Yes sir. Q. Now, can you give any reason why the Standard Oil should sell its beneficial interest for four millions, or a little over, in money and notes of stock which was paying it over $1,800,000 per annum in dividends ? 76 PBATT. Mr. Rosenthal. I submit for the purpose of the record, that this whole line of inquiry is wholly irrelevant to the issues involved in this suit, and I want to interpose an objection to it upon that ground. Q. Please answer that question. — A. I thought it was fair value for the stock, sir. Q. You did?— A. I did. Q. And it was a bona fide sale? — A. Yes sir, it was. Q. And during that time the Standard didnt receive any of the dividends? — A. Did not. Q. Were any A. Will you ask that question again, please? Q. And during the time did the Standard receive any of the divi- dends ? Mr. Rosenthal. During what time? Q. During the time it was in the name of Mr. VanBuren. — A. I told you that receipts on account of that note which came to me I turned over to the Standard Oil Company. Q. Oh. Then the dividends which were received during the time Mr. VanBuren held the stock or owned the stock came to 156 you, did they ?— A. They did. Q. And were paid over by you to the Standard Oil Company to be credited on that note ? — A. I credited them on the note and paid the proceeds to the Standard Oil Company. Q. You credited it on the note? — A. Yes, sir. Q. So Mr. VanBuren paid in cash $150,000 only?— A. That is cor- rect; one hundred fifty odd thousand, I dont remember the exact amount. Q. Was any part of that one hundred fifty odd thousand dollars received from the Waters-Pierce Company? — A. I think not. I know of no reason why it should be. Q. Did Mr. VanBuren furnish that money himself? — A. As far as I know. I dont know Mr. VanBuren 's financial transactions. Q. You dont know anything about his financial condition? — A. Only that he is abundimtly able to make such purchase. Q. Can you tell nie whether the dividends received, during the time Mr. VanBuren owned the stock, equalled the amount he paid for the stock ? — A. I dont think they did. Q. Have you any way of determining from the books? — A. The note, as I recall, was never fully paid. Q. It was never fully paid?— A. No: I mean through the dividend relations. Q. He got his $150,000 back, did he?— A. I dont know what he got back, sir. Q. You dont know.— A. You mean at the end of the purchase? 157 Q. When you got the stock back. — A. Yes, he did. Q. ^'es. sir.— A. That is right. _ Q. And he got his note, did he? — A. The note was cancelled, yes, sir. PEATT. 77 Q. So that Mr. VanBuren got his money back and got his note back, and the transaction was cancelled?— A. I cant say what Mr. VanBuren's profit was in the matter. Q. You can not? — A. No. sir. Q. Well, you dont know exactly what the stock earned during that time? — A. I do not recall. Q. Well, you can find that out, cant you?— A. The record will show what it was. Q. Now, will you find out whether Mr. VanBuren got back the money he had advanced, the !«150,000, and his note, and whether all of that was paid out of the dividends during that time that he held the stock?— A. I will try and get that information, if you want it. Q. Yes, sir. Now, do you know of any other instance in the his- tory of the Standard Oil Company where it has sold a large block of stock to a man not connected with the company, paying any such dividend as that, for any such price? Mr. MiLBUEN. I object to that question as assuming that the Standard Oil Company sold the stock, and on the further ground that in the statements furnished here it is stated and shown that that stock from the time of its acquisition by Mr. Pratt down to the 158 present time, was continuously held for the benefit of the Standard Oil Company. There is no dispute about that. Mr. Kellogg. But he denies it ; he says it was actually sold to Mr. VanBuren. Mr. MiLBFRN. But it was held — I am stating what the statement says — the statement that you have before you. Where the legal title was is another question. Mr. Kellogg. Well, I will find out if it was held then for Mr. MiLBUEN. Where the legal title was. Mr. EosENTHAL. Where is Exhibit 1 ? Mr. Kellogg. That Exhibit was made up by you, and I am finding out from Mr. Pratt whether it is correct or not. He says it is not. He says the stock was sold to Mr. VanBuren; is that correct? — A. As a legal proposition, that is correct. Q. It was an actual bona fide sale, was it? — A. Yes, but I am not denying what Mr. Milburn states, that it was in the interest of the Standard Oil Company. Q. Very well, we will find out about that. Was it or was it not a bona fide sale to Mr. VanBuren ? — A. It was a bona fide sale. Q. He owned the stock, did he? — A. He did. Q. During that time? — A. He did. Q. And it was just the same kind of a sale as though you had made it to any one else and taken their security? — A. I dont think I can ansv.'er for Mr. VanBuren, Mr. Kellogg. 159 Q. As far as you are concerned. — A. As far as I am con- cerned, I sold the stock to Mr. VanBuren. Q. So that during the time Mr. VanBuren had it, the Standard Oil Company didnt own it ; is that your testimony ? — A. That is my testimony. i a PKATT. Q. Yes, sir; that is what I thought. Mr. Rosenthal. Right in that connection, I want to read into the record this statement from Exhibit 1. Mr. Kellogg. Veiy well. Mr. Rosenthal. " Waters-Pierce Company, 2747 shares. Shares of stock of the Waters-Pierce Oil Company were acquired prior to January 1, 1899. The same amount of stock in present company, which ^^'as organized in 1900, upon the dissolution of the original company was transferred to the Standard Oil Company of New Jersey, February 28, 1907. From a short time after the organiza- tion of the present Waters-Pierce Oil Company, said stock has been held for the benefit of the Standard Oil Company of New Jersey." Mr. Kellogg. Mr. Pratt testifies to the contrary. Witness. I beg your pardon, Mr. Kellogg. Mr. MiLBtTRN. "\\'ell, now, dont let us argue. Mr. Kellogg and I some day will argue, perhaps, that proposition if it has not disap- peared from the case by then through sheer irrelevancy. Mr. Kellocg. All right, sir. Q. You know Mr. H. C. Folger, do you ? — A. I do. 160 Q. I believe you said he was connected with some of the refineries? — A. That is correct. Q„ You know Mr. C. N. Payne?— A. I do. Q. He is also connected with some branch of the organization of the Standard Oil Company ? — A. He is. Q. What branch of the business ? — -A. I think it is one of the pro- ducing or pipe line companies, I am not sure. Q. Is he connected with the New York Transit Company? — A. Possibly so. Q. What is your recollection? — A. I dont know exactly, Mr. Kellogg. Q. Both Mr. Payne and Mr. Folger, for a number of years, have been connected with the Standard organization, have they not? — A. They have. Q. How many years? — A. I dont recall the exact number; quite a number of years. Q. Ten years? — A. I should think so, surely. Q. Did you ever hear of the Corsicana Refining Company? — A. I have. Mr. MiLBUEN. You have gone over that with Mr. Pratt, Mr. Kellogg. Mr. Kellogg. Not fully. Q. Did you know that Mr. H. C. Folger and C. N. Payne consti- tuted the Corsicana Refining Company ? — A. I did not. Q. You never heard of that ? — A. Only in a general way. 161 Q. Well, had you heard that in a general way? — A. They stand in that way before the public. Q. Yes, sir. As co-partners? — A. So I understand. Q. Constituting the Corsicana Refining Company? — A. I am not familiar with the detail of that, Mr. Kellogg, at all. PBATT. 79 Q. Well, you say they stand that way before the general public; what do you mean by that?— A. Only what I say; just that. Q. That they are supposed to be co-partners, constituting the Cor- sicana Refining Company? — A. I dont know as to constituting the Corsicana Refining Company. Q. Well, connected with the Corsicana Refining Company? — A. I am not familiar with that detail at all. Q. Well, what do you mean by ' they stand that way before the public ' ? — A. Only as one might hear anything of that nature. Q. Well, about what ? about the Corsicana ? — A. About anybody. Q. About the Corsicana Refining Company ? — A. No, I know noth- ing about the Corsicana Refining Company. Q. Well, how do they stand before the public? — A. You said they stood as co-partners. Q. Yes. — A. I know nothing one way or the other about it. Q. You dont know that they stand that way before the public, then? — A. I do not. Q. What did you mean by that? — A. Only in a general way, as hearsay. Q. Well, in a general way do you understand that they so stand as partners? — A. Only as I have heard it, that is all; I have 162 no knowledge of it at all. Q. You have no knowledge of it? — A. I have not. Q. Have you heard it from them ? — A. No sir. Q. Talked over in any of your meetings of the Standard Oil Com- pany? — A. I dont recall any. Q. How did you hear it ? — A. I dont remember in any special way that I heard it. Q. Does the Standard Oil Company or any one of the Standard Oil sub-companies do business with the Corsicana Refining Com- pany? — A. I dont know, sir. Q. Does the Waters-Pierce Company do business with the Cor- sicana Refining Company ? — A. If so, I dont know it. Q. Have you ever heard of their doing business — any of the Stand- ard Oil Companies in which you are interested — doing business with the Corsicana ? — A. I dont recall that I ever have. Q. How about the Security Oil Company, did you ever hear of that company ? — A. I have heard of its existence. Q. Where is it situated? — A. Somewhere in the State of Texas. Q. Is it a refining company ? — A. I dont know, exactly. Q. What is its business ?— A. I dont know, except as I understand it is in the oil business. Q. Has the Standard Oil Company done any business with the Security Oil Company, of Texas?— A. I dont know, sir, whether it has or not. Q. Do you know Mr. F. W. Weller?— A. I do not. Q. Do you know Mr. C. S. Bayne?— A. I do not. 163 Q. President of the Seaboard National Bank ?— A. I do not. Q. Does the Seaboard National Bank hold any stock for the Standard Oil Company, of New Jersey?— A. I dont know. 80 PRATT. Q. Did you ever hear of its holding any stock for the Standard Oir^ — A. I never have. Q. Do you know Messrs. Budd, Johnson & Jenks, solicitors, of London? — A. I do not. Q. Have you had any correspondence with them? — A. I never have. Q. Have you e\'er heard of their connection with the oil busi- ness? — A. I never have. Q. Have you heard of Mr. H. B. Johnson, of London? — A. I have not. Q. Or H. Maxwell Johnson? — A. I have not. Q. Or J. W. E. Francis ?— A. I have not. Q. Did you ever hear of the London Commercial Trading & In- vestment Company? — A. I have not, except as you mentioned it yes- terday. Q. Oh, did I ask you about that ? — A. Yes. Q. The London Commercial Trading-Investment Company? — A. I know nothing of it. Mr. Rosenthal. He just answered it. Q. Are you the cuslJodian of the contracts entered into by the Standard Oil Company, of New Jersey ? — A. I dont understand that I am, sir. Q. Have you any of the contracts of that company in your posses- sion? — A. I have not. lt"4 Q. You were the custodian of the record books? — A. I was. Q. And you are now ? — A. I am. Q. The records of the meetings of the board of directors and stock- holders? — A. I am; that is correct. Q. You were subpoenaed to produce a contract entered into on the 9th of October, 1883, between the Tidewater Pipe Company, Limited, and the Xational Transit Company, and between the Standard Oil Company, of Ohio, the Standard Oil Company, of New York, and the Standard Oil Company, of New Jersey, as one party, and the Ocean Oil Company, the Chester Oil Company, and Ayres, Lombard & Company, the other parties. Mr. MiLBUEN. Dated when? Mr. Rosenthal. 1883. Mr. Kellogg. October 9, 1883. Witness. I know imthing of those contracts, sir. Q. Llave 5'ou the records of the meetings of the board of directors of the Standard Oil Company, of New Jersey, of that time? — A. I have simply the records of the Standard Oil Company, of New Jer- sey. I dont know whether it goes back that far. I had nothing to do with the corporation at that time. Q. Well, it was organized in 1882. — A. Then it would be in the records. Q. Have you examined to see if there is any record? — A. I have not examined that, no. PRATT. 81 Q. Were you not asked to produce the record ? — A. I have it here, if you wish it. 16.5 Q. Will you look and see if there is any record?— A. If I may have the book. Mr. Jones, bring me the book, please. (Book handed to witness.) What is the date, Mr. Kellogg? Q. The contracts are dated October 9, 1883, and run for a period of fifteen years, or, I believe, until thev are cancelled. — A. October 9,1883? Q. Yes sir. Mr. Rosenthal. Here is an entry on page 25. (Witness and Mr. Rosenthal look over the book together. ) Witness. This record Q. Let me see it, please. Is the book you have, the record book of the meetings of the board of directors of the Standard Oil Company, of Xew Jersey ? — A. It is. Q. Have you a record showing the ratification of a contract be- tween the parties I have mentioned, of October 9, 1883? — A. I have. Q. Will you please read that part of the resolution bearing upon the contract? — A. (Reading) "The president presented, executed by him, a contract on the part of this company, the Standard Oil Company, of Xew York, and the Standard Oil Company, of Ohio, with Ocean Oil Company. Chester Oil Company, and Lombard, Ayres & Co., said contract bearing date October 9, 1883, and also a supplemental contract with same parties bearing same date. Upon motion, the said contract was ratified and approved. The fol- 166 lowing resolution was offered and adopted." Do you care for this? Q. That is all that bears on it? — A. That is all that bears on it. Q. I dont care for anything else. Witness. George H. Vilas was secretary, if you wish to know. Q. When was that contract cancelled? — A. I know nothing about the contract, Mr. Kellogg. Q. Have you made search for it?— A. Why, I dont know that I have made any special search. It never was in my possession, and I know nothing about it. Q. You were asked to produce it.— A. I have no way of producing it, sir. Q. Can you tell, when you dont make any search, whether you have or not? — A. Only that it is not a thing which would be in my possession. Q. In whose possession would it be? — A. I dont know who would have the contract. Q. Do you know who has the contracts of the Standard Oil Com- pany, of New Jersey? — A. I dont know what office does have the contracts. Q. You have no knowledge of the officer or department of the Standard Oil Company, of New Jersey, which keeps these con- tracts ? — A. Perhaps I ought to know, but I do not, sir. 32555—08 6 82 PKATT. Q. Who would know?— A. Possiblj^ the treasurer, but I do not recall. lt)7 Q. You have made no examination for the contract?— A. Nothing more than that, sir, no. Q. You have no recollection of the contract being cancelled?— A. I would know nothing about it, no ; no sir, I have no recollection about it. Mr. EosEXTHAL. What was your position in 1890? Witness. In 1890? Air. Rosenthal. Yes. Witness. I had no position with the Standard Oil Company of New Jei'sey. Mr. Rosenthal. That is the date of the cancellation of this con- tract. Q. Did you have with the Standard Oil Company of New York?— A. No, I think not, sir. I was then in the employ of the Pratt works, which was a department of the Standard Oil Company of New York, but I had no official relation with the Standard Oil Company of New York that I recall. Q. Nor the Standard Oil Company of Ohio ? — A. No, sir. Q. Have you ever examined the contract attached to the bill of complaint? — A. I may have given a cursory reading to it, but I dont know the detail of it. Q. You were elected the secretary of the Standard Oil Company of New Jersey, at what time? — A. In 1899. Q. At the time the capital of the company was increased and the stock of these other companies taken over? — A. That is correct; at that time. Q. At the beginning of the year 1899 ? — A. Yes sir, I think 168 it was at the beginning of the year. Q. The Standard Oil Company of New Jersey was then re- organized, so far as its official staff was concerned? — A. That is correct. Q. And its stock was increased and it took over the stock of these other companies which have been shown here? — A. That is correct. Q. Since you were on the stand yesterday a statement has been pro- duced. Petitioner's Exhibit 17. which shows the acquisition by the Standard Oil Company of New Jersey of a large amount of stock of A'arious companies which had jjreviously been held by the Trustees of the Standard Oil Trust. (Handing witness paper.) You recollect in a general way of the Standard Oil Company acquiring those stocks, do you? — A. In a general waj', yes, sir. Q. And that the stock of those companies there represented was previously in the Trustees of the Standard Oil Trust? — A. I cant speak from my own knowledge, but I assume that to be the case. Q. Now, you were the secretary at the time the common stock of the Standard Oil Company of New Jersey was issued in payment for those shares, were you not? — A. I suppose I was, sir; I am not sure of the exact time. PRATT. 83 Mr. MiLBUKN. When were you elected secretary? Witness. In 1899. Mr. Kellogg. I asked him about that, Mr. Milburn, when 169 you were talking with Mr. Eosenthal. Mr. Rosenthal. It appears to have been June 20, 1899, Mr. Pratt. Mr. Kellogg. I beg pardon. , Mr. Eosenthal. June 20, 1899 ; it so appears in this oath, (Hand- ing record book to Mr. Kellogg.) It appears to have been necessary for him to take an oath of office. Q. Will you tell me from this book when you were elected secre- tary, Mr. Pratt. It is quite important to get at the date. Mr. Rosenthal. I think prior to that time he was acting as assist- ant secretary. Witness. I took the regular oath before the notary June 20, 1899, as secretary of the company. Mr. Rosenthal. While I think of it, I want to enter the appear- ance of Mr. Martin Carej^. as one of the counsel for the defendants. Witness. June 19, 1899, is the date. Q. You were elected June 19, 1899 « Mr. Melburn. And qualified on the 20th. Q. And qualified on the 20th. Well, according to the statements furnished in evidence, all of the stock of those companies was re- ceived between June 19, 1899, and December 21, 1904; substantially all in 1899 and 1900?— A. Yes, sir. Q. Now, Mr. Pratt, then all of the stock of the Standard Oil Com- pany of New Jersey which was issued in payment for those shares was issued by you as secretary of the company ? 170 Mr. Rosenthal. In payment of what shares? Mr. Kellogg. These shares in these twenty companies. — A. I was elected June 19, 1899, and on that day the resolution making the exchange on the basis indicated was passed by the board. Q. Let me see the resolution. (Witness hands minute-book to Mr. Kellogg.) Mr. Rosenthal. Can you work it out? Mr. Kellogg. Yes, I understand it perfectly. Mr. MiLBUEN. Of course he does. Q. Mr. Pratt, will you read that resolution in evidence. — A. Hadnt we better have a copy of it made ? Q. Oh, it will take so long to make a copy. — A. " Resolved, that the president or one of the vice presidents " Mr. Rosenthal. What is the date of it? Mr. Kellogg. The date of the meeting. — A. June 19, 1899. Q. Meeting of the board of directors ? — A. It was. Q. Please read the preliminary minutes of the meeting showing who was present and the date of the meeting.— A. (Reading) "A meeting of the board of directors was held at No. 26 Broadway, New York City, June 19, 1899, pursuant to call of the president. There 84 PRATT. were present Messrs. H. M. Flagler, William Rockefeller, John 171 D. Archbold, H. H. Eogers, W. H. Tilford, and Paul Babcock. Mr. Flagler occupied the chair. On motion, it was unanimously resolved that the president or one of the vice presidents and the treas- urer or one of the assistant treasurers, be and are hereby authorized to issue certificates of common stock of this company and deliver the same, in purchase of the stocks of the following companies, at the. rate of one share of common stock of this company for the following fractional shares, to wit : Anglo-American Oil Company, Ltd., 26,000. (The fraction is 972,500. The denominator is the same in every case.) Q. 26,000/972,500 of a share?— A. 26,000/972,500; The Atlantic Refining Co., 50,000/972,000; The Buckeye Pipe Line Co., 200,000/ 972,500; Eureka Pipe Line Company, '50,000/972,500; Forest Oil Company, 55,000/972,500 ; Indiana Pipe Line Oil Company, 20,000/ 972,500; National Transit Co., 509,104/972,500; New York Transit Co., 50,000/972,500; Northern Pipe Line Co., 10,000/972,500; The Northwestern Oil Natural Gas Co., 32,785/972,500; Ohio Oil Co., 80,000/972,500; The Solar Refining Co., 5,000/972,500; Southern Pipe Line Co., 50,000/972,500; South Penn Oil Co., 25,000/972,500; Standard Oil Company, of Indiana, 10,000/972,500 ; Standard 172 Oil Company, of Kentucky, 10,000/972,500; Standard Oil Company of New Jersey, Preferred Stock, 100,000/972,500; Standard Oil Company of New York, 70,000/972,500 ; Standard Oil of Ohio, 35,000/972,500 ; Union Tank Line Company, 35,000/972,500. Mr. MiLBUEN. That includes, you say, the preferred stock ? Mr. Kellogg. Yes, sir. Q. The Standard Oil Company of New Jersey stock, which is in- cluded in that, was $10,000,000 of preferred stock, wasnt it? — A. Yes, sir. Q. And that $10,000,000 of preferred stock was the capital of the Standard Oil Company, of New Jersey, at the time it was held by the Standard Oil Trustees and at the time of the liquidation? — A. No, it was common stock that the trustees held. Q. Well, it became preferred stock when you increased the capital in 1899 ?— A. It did. Q. It is the same stock. It was the stock which had previously been held by the Trustees ? — A. I so understand it. Q. Yes, sir, and was changed from common stock into preferred when you re-organized the company in 1899? — A. That is correct. Q. So that those stocks represented in that resolution are the stocks which were previously held by the trustees of the Standard Oil Trust? — A. I am not familiar with the Standard Oil Trust re- lations, Mr. Kellogg. I assume that to be a fact, but I dont know it personally. Q. You have no doubt about that, have you? — A. I have no reason to doubt it. I dont Icnow it as a fact. 173 Q. Wliat is that?— A. I dont know it for a fact. That is all I know about the resolution. PEATT. 85 Mr. MiLBUEN. Well, we can take it. Q. You believe that to be the fact? — A. Yes, sir, I believe that to be the fact. Q. And against those stocks, the Trustees of the Standard Oil Trust had issued 972,500 shares of trust certificates? — A. Again I say I am not familiar with those records or the history of the busi- ness at that time. I was not connected with it in a way to determine it in any way. Q. Well, you became connected at the time of the organization of the Standard Oil of New Jersey ? — A. At that meeting. That is the first official relation that I had, yes, sir. Q. Very well. You were present at that meeting, were you? — A. No, I was not. Q. Well, you v,'ere at the next meeting? — A. At the next meeting, yes, sir. Q. You knew of that meeting ? — A. Well, I knew after it was held, yes, sir. Q. You had to carry out that resolution, didnt you ? — A. I was not the officer named to do it, Mr. Kellogg. Q. Well, the secretary is named, isnt he ? — A. No, sir. Q. The secretary had to sign the stock, didnt he? — A. No, sir. Q. Wasnt the Standard Oil Company stock signed by the secretary at all ?— A. No. 174 Q. Never was? — A. Never was. Q. Who issues the stock of the Standard Oil Company ?— A. It is issued by — it is signed by the vice president or treasurer. Mr. MiLBTJEN. President? Witness. Vice president or treasurer. Q. Not by the secretary ? — A. Not by the secretary. Q. And you never issued any of the stock or superintended its issue ? — A. I never did, sir, as secretary of the company. Q. You knew of its issue, didnt you ?— A. Oh, yes sir. Q. And you knew of this resolution, didnt you? — \. No, I cant say that I did, sir. Q. Who was the treasurer at that time?— A. Mr. Tilford. Q. W. H. Tilford?— A. W. H. Tilford. Mr. Kellogg. All right, we will prove it by him. Q. You knew how many Trustees' certificates the Trustees of the Standard Oil Trust had outstanding, didnt you?— A. I dont think I did, sir. Q. You didnt. Mr. MiLBUEN. Let me see if we cant get that out of the way. Isnt it admitted here? Mr. Kellogg. No, sir. Mr. MiLBTJEN. It is not? Mr. Kellogg. No, sir. Mr. MiLBTJEN. About how many ? 175 Mr. Kellogg. Oh, it may be. Mr. MiLBTJEN. Well, I thought it was. 86 PEATT. Mr. Kellogg. There is very little admitted there. Q. That proportion in that resolution, that is, the amount of stock of each one of those twenty companies, which was received by the Standard Oil Company of New Jersey, is in exactly the same pro- portion as the stock bears to the Trustees' certificates previously is- sued?— A. I dont know as to the fact of that matter, Mr. Kellogg. Q. You had some of that stock, didnt you, those sub-companies?— A. Yes. Of the sub-companies? Q. Yes. — A. Yes; yes, I did. Q. And you had some Trustee certificates prior to that time? — A. Yes. Q. And you represented a large amount of that stock, didnt you ? — A. I did. Q. You represented a large amount of the Trustees' certificates, didnt you ? — A. " Large " is a relative term ; quite a quantity of it, yes, sir. Q. 50,000 shares of it?— A. Yes, sir. Q. And you took assignments in the sub-companies? — A. Yes, sir. Mr. MiLBURN. ^Vhen did you do that. Mr. Pratt? In 1892? Witness. In early 1892 ; I dont recall the exact month. Q. Yes sir. And you know hoAv many shares of the sub-companies you got in exchange for your trust certificates? — A. I did know; I dont recall now, Mr. Kellogg. 176 Q. They were all divided on an equal basis, were they not? — A. They were. Q. In proportion ; all of the stock of the sub-companies in propor- tion to the number of trust certificates outstanding? — A. I cant an- swer clefinitel}^ about that. Q. Do you mean to say that you had over 50,000 shares of trust certificates, or represented that, and you dont Iniow the proportion that the stocks of the sub-companies were divided into? — A. At that time I probably did, but I dont recall now what the basis was. Q. Have you any way of refreshing your memory? — A. I wouldnt have, but perhaps the treasurer could do it. That didnt come into my knowledge at all. Q. Well, you were looking after your own business at that time, weren't you ? — A. I was content to take what the rest took, if that is the proposition. Q. Yes, sir. And then when you exchanged your stock and that which you represented, into the Standard Oil Company of New Jer- sey, you got identically the same number of certificates of stock of the Standard Oil Company of New Jersey, didnt you, as you had previously held of the trust? Mr. MiLBUEN. You have gone over that. A. I dont know exactly ; I assume it was so, but I dont know ex- actly. Mr. IlosENTHAL. Tliose questions were asked yesterday. Mr. Kellogg. Yes, but he said he didnt know. PEATT. 87 Mr. EosENTHAL. He said he presumed he did, providing in 177 the meantime he hadnt sold any. Q. As I refresh your memory by the resolution, it shows exactly how it was done. Mr. Rosenthal. It doesnt refresh his memory as to whether he sold any during those seven years. Q. Do you recollect of having sold any? — A. I think I did, but I am not sure, Mr. Kellogg. Q. Did you ever see the original trust agreement? — A. I signed what I supposed was the original trust agreement. Mr. Rosenthal. That question was asked and answered yesterday, and Mr. Pratt said that he sigTied it, and you called his attention to it. Q. Do you know that the trust agxeement contained in the bill of complaint is a copy of the trust agreement? Mr. MiLBUEN. That can be taken. Mr. Kellogg. But I want to prove it by somebody that knows it. Mr. MhjBTten. Take it on the record that the trust agreement set out in the bill of petition is a correct copy of the original. Mr. Kellogg. "V^Tiere is the original? Mr. MiLBURN. Well, it is twenty-five years ago, and if it can be found it will be produced, biit I have not been able to locate anybody with that original agreement; but I must say I have not worried much about it, in as much as there is no dispute about it. 178 Mr. Kellogg. You ha vent made any strenuous effort. Mr. MiLBTTEN. I havent made a very strenuous effort, as it is all admitted. Mr. Kellogg. Well, I wish to have it, if I can get it. Mr. MiLBTJEN. Well, if I can get hold of it I shall let you have it, to look at it. Q. Mr. Pratt, how does the Standard Oil Company of New Jersey vote the stock which it holds in all of these sub-companies? — A. I dont understand your question, Mr. Kellogg. Mr. MiLBUEN. How does it vote the stock it holds in the sub-com- panies ? Witness. Why, as anybody else would vote stock that they hold in corporations. Q. By proxy? — A. By proxy, yes. Q. It executes a proxy, does it?— A. If that is the convenient way of doing, it does. Q. Well, I want to know how it does it, whether it executes a proxy in the annual meetings. — A. It executes a proxy, yes, sir. Q. Do the board of directors of the Standard Oil Company author- ize a proxy ? — A. I assume they do. Q. Will you give us the record showing their authorization of proxies since 1899? Mr. Rosenthal. We will give it to you if there is any. Witness. What is it he wants ? 179 Mr. Mllbtjen. If there is any resolution passed by the board authorizing him to give a proxy to vote the stocks owned by 88 PRATT. the New Jersey Company. Its owns stocks in a lot of corporations. Now, then, it votes those stocks at the annual meetings. Mr. EosENTHAL. I dont think that is in there, is it ? Witness. I dont know. Mr. RosE^fTHAL. I dont think there is anything in here on that, in the minute-book. Q. Well, look at the last year and see. Mr. Rosenthal and witness look through the book together. Mr. Rosenthal. There is nothing in here at all. Q. There is no record in the minutes of the meetings of the board of directors of the Standard Oil Company authorizing proxies? — A. I dont find any, and I dont recall any. Q. Isnt there a standing proxy committee? — A. I never heard of one. Mr. Kellogg. Well, I would like to examine the record and see. Mr. Rosenthal. You can examine the record. Q. Who votes the stock of the various companies? Mr. Rosenthal. He has alreadjf said it was voted by proxy. Mr. MiLBtTRN. Well, he means who is the proxy. Q. Yes, who has the proxy? — A. I think that would vary in every individual instance. Q. In every case? — A. Probably in every case. 180 Q. Do you sign any proxies for annual meetings? — A. I dont recall, but I presume the secretary's signature, or the as- sistant secretary's signature, would probably be on the proxy, with the president or vice president. Q. Have you in j^our office those proxies or copies of them, or any record of them? — A. I dont think we have; I dont recall any. Q. Do you recollect of ever having signed any? — A. I dont dis- tinctly recollect so. Q. Well, do you indistinctly recollect? — A. No, I do not. I am not trying to mislead you, sir. I do not recall. Q. Well, then 5'-oii know nothing about it? — A. I have no exact knowledge on that matter, no ; I dont recall. Q. Whose duty would it be to execute those proxies? — A. I as- sume the secretary or one of the assistant secretaries. Q. Well, who were the assistants? — A. Well, Mr. AMiite might be able to answer that question. Q. What is his full name?— A. Mr. C. T. A'^Tiite. Mr. MiLBUEN. You have it? Q. Mr. Charles T. Wliite?— A. That is right. Mr. Rosenthal. Yes, he is here. Mr. MiLBUEN. I believe Mr. Pratt gives very little attention to the routine duties of that office. That is so, isnt it, Mr. Pratt? Witness. That is correct. 181 Q. Mr. White is the man more in immediate charge? — A. Yes. PRATT. 89 Mr. Kellogg. Then we will ask Mr. White. Q. Do you keep the stock transfer books in your office?— A. The stock transfer books, yes, sir. Q. And the stock ledger? — A. Yes, sir. Q. Showing all stock issued ? — A. Yes, sir. Q. The name of the party to whom issued ? — A. Yes sir. Q. And all transfers of stock? — A. Yes sir. Q. Your office is not the custodian of the stocks and securities held in other companies? — A. Xo, sir. Q. But the treasurer's office is ? — A. Yes, sir. Mr. EosENTHAL. That is hardly accurate, is it, ISIr. Pratt ? WiTKESS. I beg your pardon? Mr. Rosenthal. That is hardly accurate, the latter part of your answer, is it? The Witness. The treasurer's office? Mr. MiLBURN. The custodian of the securities? Mr. Rosenthal. Isnt there a securities committee? Witness. Will you read the question again, please ? The question was read. Witness. Well, the latter would be modified. There is a committee who have general oversight and care of those securities. Q. "^Alio is the committee? — A. Mr. Archbold is a member, Mr. Jennings and myself. I think there is one other; I do not re- call. 182 Q. Was that committee appointed by the resolution of the board of directors of the Standard Oil Companj' ? — A. It was. Q. When? — A. Some years ago. Q. Please find the resolution. Mr. Kellogg. (After talking to Mr. Rosenthal) Mr. Rosenthal says Mr. White will be here. Q. You are on that committee, are you ? — A. I am. Mr. MiLBUEN. The members being changed, dont you think you could get the last resolution? Witness. They have been changed several times. I dont know which the last one is. (Mr. Rosenthal and Mr. Milburn look through the minute-book). Mr. Rosenthal. Here is Mr. Jennings' appointment. Q. I show you a resolution dated September 20, 1899. Will you please read that in evidence. — A. (Reading) " On motion, unanimously adopted, it was resolved that Messrs. John D. Archbold, C. M. Pratt and John Bushnell be and are hereby appointed a committee to receive and hold on behalf of the Standard Oil Company of New Jersey all stocks and securities now owned or which may be hereafter acquired by this company." Mr. Kellogg. Now, the amendment to the resolution is on what page ? Mr. Rosenthal. 194. I think there is another one inter^'ening. 90 PRATT. Mr. Bushnell, I believe, was replaced by Mr. Barstow, 183 wasnt he, Mr. Pratt? Witness. No, Mr. Bushnell's resignation was accepted, but I think there has been no election since. Mr. Rosenthal. On page 194 you will find it. Witness. (Reading) : " Resolved that Mr. Walter Jennings be and is hereby appointed an additional member of the committee appointed by this board of directors on September 28, 1899, to receive and hold on behalf of this company all stocks and securities now owned or which may be hereafter acquired by this company, and all receipts given for securities delivered to said committee shall be signed by any two of them." Q. Do you know whether there Avas any change in that committee other than that? — A. Only in the case of Bushnell, that is all, sir. Q. What is Mr. Bushnell's name ? — A. John Bushnell. Mr. MiLBUEN. When did he resign? Q. When did Mr. John Bushnell resign? — A. He resigned some months ago ; I dont recall the exact date. Q. You dont recall? — A. No. Q. Who took his place? — A. There has been no election of anyone. Q. There has been no election of anyone to take his place? — A. There has been no election of anyone. Q. Then you know of no other changes? — A. I know of no other changes. Q. This committee has charge and holds all stocks and 184 securities of the company? — A. That is correct. Q. And are the old trust certificates, any of them, in the pos- session of this committee ? — A. I have never known of it. Q. Have the certificates of the Waters-Pierce Oil Company stock been with this committee since 1900 ? — A. I dont think so, but I dont know, Mr. Kellogg. Q. Has that committee got books showing those stocks? — A. I think there are no books ; simply statements made as to Q. Do they keep a record of the stocks held by them ? — A. Only a blotter record. There is nothing formal about it. Q. They keep a blotter record ? — A. A memorandum book. Q. A memorandum book ? — A. Yes. Q. Entry book?— A. That is all. Q. In which is entered these securities ? — A. Yes, sir. Q. And they are kept in the vaidts? — A. Yes, sir. Q. Of the Standard Oil building? — A. I am not sure. I think not in the building, but in the vaults. Q. In vaults, yes. — A. They may be in the building. Q. Now, who keeps that blotter? — A. John Bushnell kept the blotter. Q. John Bushnell? — A. Yes, sir. Q. Until he resigned? — A. Yes, sir. Q. Do you know the exact date of Mr. Bushnell's resignation ?— A. I do not, exactly. PEATT. 91 Q. Does the record show it ? — A. No, it does not. 185 Q. Have you any way of ascertaining it? — A. I dont know of any way except by his correspondence; perhaps that might show. Q. Do you know where Mr. Bushnell is now ? — A. I do not, sir. Q. Well, who has kept that record since? In whose custody is it now ? — A. I suppose in the committee's ; I dont know exactly. Per- haps that could be ascertained, but I dont recall. Q. T^^at member of the committee? — A. I would have to inquire, Mr. Kellogg, I dont Imow. Q. Do you have any regular meetings of your committee? — A. Oh, no. Q. Do you have meetings often? — A. No. Q. Do you know of any other committees of the Standard Oil Com- pany? — A. I do not. Q. You recollected this committee yesterday when I was asking you about it? — A. Yes, sir. Q. You didnt tell me about that committee when I asked you for the committees of the Standard Oil Company. — A. Well, this is hardly a committee, except to give protection to the securities. There is no active agency about it at all. Q. It holds two or three hundred millions of securities, doesnt it ? — A. Yes, but that is not active business ; it is simjDly Mr. MiLBURN. Custodian. Witness. Custodian, that is all. Q. There are no other committees ? — A. I know of no other. 186 Q. In the Standard Oil organization? — A. I dont know of any other. Q. Do you know of any in the Standard Oil Company of New York? — A. I think perhaps their export people might be termed a a committee, although it is hardly such. Well, tell me about the export committee. — A. They are simply the correspondents of the foreign buj^ers. Q. You have an export department, have you? — A. The Standard Oil Company of New York has an export department. Q. Who has charge of it ? — A. There are five or six men. Q. Name them. — A. William Donald; W. I. — or W. J. — Teagle; I don't remember the initial; Walter McGee; W. E. Bemis; R. W. McNall. Those are all that occur to me. Q. How is that last name spelled ? — A. M-c-N-a-1-1. Q. Is Mr. McNall the same man who represented the Waters-Pierce Company at 26 Broadway for some years ? — A. Yes, sir, he is. Q. Does he still represent that company ? — A. He does not, as far as I know. Q. He does not? — A. He does not, no. Q. When did he resign from that position ? — A. I don't know. Q. About when ? — A. I dont recall, sir. 92 PEATT. Q. He was the New York agent of the Waters-Pierce Company, was he? — A. I dont know, Mr. Kellogg, what his title was, or his position. Q. He had an office at 26 Broadway, did he? — A. I dont know in detail about that matter. 187 Q. "Well, how do you know he is the same man, then? — A, There is but one Mr. McNall that I know of by these initials. Q. And he was connected with the Waters-Pierce Company? — A. I think he was, yes. Q,. For a term of years ? — A. As far as I know he was. Q. After the first Waters-Pierce Company was ousted from Texas and the second Waters-Pierce was organized, wasnt it? — A. I dont know. Q. Well, some time since 1900, wasnt it? — A. I am not familiar with the detail of that at all. Q. Well, how do you know he represented them then ? — A. I have that as a general knowledge; but I dont know the detail of his ap- pointment or how long he was there. Q. Now, is it not a fact that the statements of the sale of all oil, the details of the business, daily reports of the Waters-Pierce Com- pany were sent to Mr. McNall? — A. I dont know. Q. During the time he represented the Waters-Pierce, was he on the export committee also? — A. I think not. I dont know the dates. My impression is not. Q. Are you an officer or a director of the Standard Oil Company of New York ? — A. I am a director. Q. ^Yho is the secretary of that company? — A. I think it is Mr. White, but I am not absolutely sure, Mr. Kellogg. Q. Mr. White or Mr. William P. Howe? — A. I dont remember which. They are either assistant secretary or secretary, I am not sure which. 188 Q. Have you had compiled the list of directors and officers of all of the sub-companies of the Standard Oil Company? — A. All that we have record of, sir, are there. Q. All right. Mr. MiLBTJRN. I dont know that they have all absolutely got up yet, but they may be. Mr. Kellogg. Well, we will get at it as far as they will go. Mr. MiLBURN. That is the way they are, on the cards. (Handing a package of cards with names thereon to Mr. Kellogg) You see we give you everything. All you have to do is to ask. Mr. Kellogg. I am very much obliged to you. Mr. MiLBUEN. Everything but honor. Mr. Rosenthal. No back talk on that. Mr. Kellogg. I dont think so. Are these records which you want returned ? Mr. EoSENTHAL. I think several copies have been made, have they not, Mr. Pratt? Mr. Pratt. Yes. PRATT. 93 Mr. EoSENTHAL. So you are at liberty to keep the list. How shall we mark those — as a bundle? The first of the package of cards was marked Petitioner's Exhibit 18, and the others were to be marked as the same Exhibit except that each card Avas to be numbered 1, 2 3 respectively, in succes- sion. 189 Q. Is Petitioner's Exhibit 18, 1 to 186, the list of directors and officers of the various sub-companies of the Standard Oil Company? — A. As far as we have any record of it, Mr. Kellogg, it is. I understand that is the list. Q. The secretary of the Standard Oil Company of New York seems to be Mr. William P. Howe. You are a director, I see. — A. I am. Q. Was this trade committee, this export committee, appointed by the board of directors of the Standard Oil Company of New York ? Mr. Rosenthal. Is that a formal committee, formally appointed? Witness. It is not, Mr. Rosenthal, no. I said in the nature of a committee; it is not a strict committee. Q. What are the duties of the committee? — A. They are the cor- respondents with the foreign customers. Q. Were they appointed by the board of directors? — A. They were not, as far as I know. Q. How are they selected? — A. Individually, they would be se- lected by the officers of the Standard Oil Company of New York. Q. Now, has the Standard Oil Company of New York any other committee ? — A. I know of none. 190 Q. Never heard of any other committee? — A. I dont recall any other. And dont misunderstand me about that being a committee, Mr. Kellogg ; it is simply in the nature of a committee. Mr. Kellogg. I think I understand you perfectly. Witness. No formal relations there of any sort, I mean. Q. Do they have a secretary or officers?— A. No, sir, I think not. Q. They have charge of the export business ? — A. They do. Q. Immediate charge of it?— A. The Standard Oil Company of New York. Q. Now, does the Standard Oil Company of New York have charge of the export business, as a corporation ?— A. It has an export business. Q. Well, I mean of the other companies ?— A. No, sir, only inci- dentally. Q. Well, the oil produced by the Standard Oil Company of New York is not the only oil exported?— A. It is not. Q. This export committee have charge of all exports, dont they, direct supervision? — A. I think not. Q. Only the Standard Oil Company of New York?— A. Only of the Standard Oil Company, as far as I recall it. Q. The Standard Oil Company of New York does not ship 191 a very large percentage of all export oil, does it? — A. No, it buys from the Standard Oil Company of New Jersey what oil it requires to make its trade. 94 PEATT. Q. Then the Standard Oil Company of New York purchases from the other companies and sells abroad all the export oil, does it? — A. 1 think not all ; it does a portion of it. Q. Wlio would know about that? — A. I dont know who would answer that question. Q. Who has direct charge of the export business? — A. Of the Standard Oil Company of New York, those gentlemen I have named have charge of it. Q. Do any other of the sub-companies of the Standard Oil Com- pany of New Jersey export oil directly, or do they sell it to the Standard Oil Company of New York ? — A. I cant answer such ques- tion, sir ; I dont know. Q. This conmiittee would know? — A. I dont know whether they would or not. Q. Has Mr. Bemis any relations to the Standard Oil business other than as a member of this committee? — A. I dont know whether he has or not. Q. "W-liere is Mr. Bemis? — A. The last I knew he was in Japan; I don't know where he is. Q. How long has he been gone? — A. Oh, eight or ten months, I think. 192 Q. When is he expected back ? — A. I dont laiow. Q. Do you know of his having charge generally of the selling of oil for all the Standard Oil companies ? — A. I never heard of his doing that. Q. Is Mr. William Donald in the city? — A. I dont know whether he is or not. Q. Or Mr. W. J. Teagle?— A. I think Mr. Teagle is not; I think he is abroad. Q. Is Mr. Walter McGee ? — A. I am not sure whether he is or not. Q. And Mr. R. W. McNall?— A. I dont know. Mr. Kellogg. If any of those gentlemen are here, will you have them present in the morning as witnesses ? Mr. MiLBTjEN. We will inquire about it and find out the situation. Mr. Ejellogg. All right, sir. I want the man who knows about the export oil. Q. You know of no other committee in charge of any branch of the business of the Standard Oil Company of New Jersey, or any of its sub-companies? — A. I do not. Q. Mr. Pratt, were you acquainted with the men who signed the Trust agreement in 1882? I show you a list of them. (Handing witness the bill of complaint.) — A. I was a boy, at that time, 193 Mr. Kellogg; I knew my father, and I knew Mr. Eogers, his partner. Beyond that I am not sure that I knew anyone. Q. Your father was Charles Pratt ? — A. Yes sir. Q. And connected with one of the concerns which went into the trust? — A. Yes sir. Q. What was the name of that company? — A. Charles Pratt & Company. TILFOBD. 95 Q. Was Mr. Rogers also a member of that concern? — A. He was. Q. You dont know the rest of the men ? — A. I do not, no. Q. That is, you didnt then; j^ou know some of them now? — A. Yes. Mr. Kellogg. I think that is all I wish to ask Mr. Pratt. 194 Wesley H. Tilfoed, called as witness by Petitioners, being duly sworn, testified as follows: Direct -examination by Mr. Kellogg: Q. Give your full name, Mr. Tilford.— A. Wesley H. Tilford. Q. You are connected with the Standard Oil Company of New Jersey? — A. Yes sir, as treasurer. Q. You are treasurer? How long have you been? — A. Since 1899, since the reorganization. Q. Since the reorganization in 1899?— A. Since 1899. Q. You are also vice president of the Standard Oil Company of New York, are you not? — A. Yes sir. Q. How long have you been? — A. Between two and three years. Q. Previous to the reorganization of the Standard Oil Company of New Jersey, in 1899, you were one of the Liquidating Trustees of the Standard Oil Trust, were you not? — A. Yes sir. Q. Appointed originally at the time of the resolution of liquida- tion in 1892?— A. Yes sir. Q. The other liquidating trustees were John D. Rockefeller, 195 Henry M. Flagler, William Rockefeller, John D. Archibold. Benjamin Brewster, Henry H. Rogers, and O. B. Jennings, were they? — A. Yes sir. Q. Were there any changes during the years of liquidation? Mr. MiLBUEx. Now just wait a moment. That is 1892. I want to have it on the record here that I object to this question and any other testimony of the events or transactions prior to Januar}^ 1899. I need not keep on repeating that objection? Mr. Kellogg. No sir, the objection may stand as an objection to all that testimonj^, preceding that time or any part of it. Mr. MiLBURN. Yes, that is right. Now when you come to some- thing about 1890, going back of that, I take an objection as to that. Mr. Kellogg. You can enter it right here if you wish to. Mr. MiLBURN. Counsel also consents that we may enter here an objection as to any testimony as to events or transactions or occur- rences prior to 1890. Mr. Kellogg. You mean the passage of the Sherman Act? Mr. MiLBURN. Prior to the time that the Sherman Act of 1890 went into effect. Mr. Rosenthal. July 1, 1890. Mr. MiLBURN. July first, 1890. Mr. Pagan. July 2nd. 196 Mr. MiLBURN. And that objection shall be deemed to apply to all of the testimony of that line, without repetition. Mr. Kellogg. That is all right. 96 TILFOED. Mr. Greek. On behalf of the Security Oil Company I desire to record the same objection, without repeating it. Mr. Kellogg. The same understanding may be entered. The Examinee. Does that apply to the testimony already taken ? Mr. MiLBUEN. I dont think there has been any substantial testi- mony taken, that I recall, up to this time. I do not think Mr. Pratt has really gone beyond 1899 in any substantial testimony. Mr. Kellogg. Now you may answer the question, Mr. Tilford. Witness. Which question do you wish me to answer ? Mr. MiLBUEN. The last objection made in respect to the passage of the Sherman Act, I think perhaps we will reserve until question is asked relating to some subject-matter prior to that time, because the court might say that an objection stated as this objection is stated, without a question being asked, does not properly save the point. Mr. Kellogg. All right. Mr. MiLBTJEN. We can repeat that. Mr. Kellogg. This can stand, if you wish it, and then you can repeat it. Mr. Rosenthal. Yes. 197 Mr. MiLBTJEN. ,\.nd I vvould like the privilege of adding hereafter, to both objections, the grounds; that is, by tomor- row. Mr. Kellogg. No objection to that. Write them out and hand them to the reportei' in the morning, or to the Examiner. The following question was read : Were there any changes during the years of liquidation? A. I think there were, but I am not sure. Q. Have you the records of the liquidating trustees? — A. I have not. Q. Where are they? — A. I dont know. Q. Have you ever had them? — A. No sir. Q. Have you ever seen them ? — A. I cant answer that ; I think not, but I dont remember of having seen them. Q. You attended the meetings did you not. — A. Some of them. Q. You acted as liquidating trustee during all those years? — A. Yes. Q. Minutes were kept of their meetings, were there not? — A. I dont know. Q. You had a secretary, didnt you? — A. We had a secretary— I dont know whether we had a secretary or not. Q. You dont know ? — ^A. I dont remember, no. 198 Q. ^^Tiere was the headquarters of the Liquidating Trus- tees? — A. At the office of the Standard Oil Company, in the same Ijuilding. Q. 26 Broadway, as commonly known. — A. 26 Broadway, if that was in existence then. Q. Well was it?— A. 1892? I think it was. Q. Where was the headquarters of the Standard Oil Trustees?— A. In the same place. TIL.FOED. 97 Q. 26 Broadway? — A. 26 Broadway. Q. Were you a trustee?— A. I was, part of the time. Q. When were you elected ?— A. I think in 1887 or 1888. Q. And served until 1892?— A. Yes sir. Q. Did the trustees keep records of the meetings of the trustees ?— A. I dont recall. Q. Where are the trustees records, do you know? — A. I do not, no sir. Q. Were you connected with the Standard Oil Company or some of its companies during all the years of the Trust? — A. Yes sir. Q. What position did you occupy? — A. I was connected with the Chess Carley Company, whose headquarters were at Louisville, Ken- tucky. Mr. MiLBURN. When is this ? Prior to the Trust ? 199 Mr. Kellogg. During the Trust period. Q. Chess Carley Company were parties to the Trust Agree- ment, were they not ? — A. Not Chess Carley Company. I think. May be Chess Carley & Company ; not the company, as I understand it. (Mr. Kellogg hands witness bill of complaint.) Witness. I dont think the " Company " was ; I dont know ; I knew nothing about that. Q. Well, Chess Carley & Company were, then? — A. Well, Chess Carley & Company may have been, I dont know. I had nothing to do with that firm. Q. Well, what firm were you connected with, — the Chess Carley Company, the corporation ? — A. There had been a firm of Chess Car- ley & Company. I was not connected with that. I was connected with the Chess Carley Company. Q. Now Chess Carley Company which signed this Trust agreement seems to have been a corporation? — A. Well, that I know nothing about. Q. Because sub-division 3 provides that a portion of the stockhold- ers and members of the following corporations and limited partner- ships, to wit, and then follows a list of corporations and limited part- nerships having stock. — A. Well, I was not connected with the Trust at that time, so I dont know. 200 Mr. MiLBURN. In 1882. Witness. I was connected with the Trust until 1887 or 1888 ; I was not connected with the Chess Carley Company in 1881. Q. Well do you know whether the Chess Carley Company entered the trust? — A. I do not; I had nothing to do with that. Q. What part of the business did you attend to ? — A. I attended to looking after the interest of the Standard, in that concern. Q. The interest of what? — A. Of the Standard Oil Company in that concern. Q. What was the interest of the Standard Oil Company in that con- cern at that time? Mr. MiLBrRN. Now, then, I take my objection. That is in what ? 32555—08 7 98 TILFOKD. Mr. EOSENTHAL. 1881. WiTXESs. In 1881. Mr. MiLBUEN. Now if the stenographer would kindly repeat the objection that I took previously, with respect to the period prior to July 2nd, 1890, set the same out, and in the morning I will give you the grounds of the objection. (The previous objection as entered on the record was as follows: " I want to have it on the record here that I object to this ques- 201 tion and any other testimony of the events or transactions prior to January 1899.") Mr. Greek. The Security Oil Company desires to offer an objec- tion to all testimony prior to July 2, 1890, and especially to the trust agreement which I believe has heretofore been offered. I think he offered it by consent. Mr. Kellogg. There is no objection to the objection. Mr. Geeee. On the ground that it is immaterial, on the ground that it relates to events prior to the time that the law was enacted under which this bill is brought. Mr. McKenzie. The same objection on behalf of the Manhattan Oil Company. Mr. Kellogg. Certain of the defendants have not admitted the trust agreement which is set out in the bill of complaint. Mr. Roseivthal; It is not admitted that this is a true and correct copy? Mr. Kellogg. Yes, have not admitted this is a true and correct copy of the original agreement. Most all of the defendants have ad- mitted it. The Security Oil Company and the Manhattan Oil Com- pany, I believe, have not made that admission. I ask the gentlemen if, subject to their objection that it is irrelevant and immaterial on the grounds they have stated, they are willing to admit that this is a copy of the trust agreement. Mr. Geeee. I am, Mr. Kellogg, subject to that objection. Mr. McKenzie. I am, too. Mr. Kellogg. And I offer this in evidence, because there 202 are one or two parties present. The trust agreement is con- Mr. Kellogg. And I offer this in evidence, because there are consists of two agreements, the one of the second day of January, 1882, and the supplemental agreement of January 4, 1882. It may be deemed read in evidence and need not be copied into the minutes of the Examiner. Mr. MiLBUEN. Now, right in connection with that, the defendants object to the admission in evidence of this agreement upon the grounds stated, to wit, that the agreements were entered into prior to July 2, 1890, and are not therefore relevant or material evidence with respect to any matter in issue here. And we will enlarge those grounds later and hand it to you by to-morrow. Mr. Kellogg. All right sir. The hearing was here adjourned until Thursday, September 19th, at 10:30 A. M. TILFOED. 99 203 Tpicrsday, Septemher 19, 1907. The hearing was resumed at 10 :30 A. RI. Wesley H. Tilfoed, recalled as a Avitness on behalf of Petitioner, testified as follows: Direct examination (Eesumed) by Mr. Kellogg: Q. Mr. Tilford, before going on to the subject I was examining you about last night : Does your oiRce keep a record of all dividends paid by the Standard Oil Company of New Jersey?— A. I dont know whether that is in the treasurer's office (the assistant treasurer would know that) or in the controller's office. Q. I asked the controller yesterday, as I recall, if the dividend reported in this statement of $14,403,188.50 for the year 1899 was not the dividend for a part of the year. I am not absolutely sure of his answer, but my recollection is that he thought it was the dividend for the entire year. "Was not the dividend for the year 1899, $32,008,541? — A. I ha vent any recollection of it. I would be very glad to look it up. Q. Will you look it up, please? — A. Yes, I will do that. Mr. MiLBUEN. That is the Xew Jersey dividend of 1899 ? Mr. Kellogg. Yes. Q. I show you copy of the trust agreement which was introduced last night, with the list of companies the stocks of which were 204 placed in the Trust in 1882 ; a list of part of the companies on the first page and the balance on the second page. It would appear from the list on the second page that Chess Carley Company had signed that agreement — I dont mean signed the agreement; the stockholders of Chess Carley Company, or a part of them, had signed that agreement. Have you thought of that since I asked you last night? — A. Xo, I ha vent any knowledge of that at all. Q. Who were the stockholders of the Chess Carley Company when it was organized ? — A. The Standard Oil Company of Ohio had fifty per cent, and Mr. F. B. Carley, of Louisville, owned fifty per cent. Q. Was that stock in the name of the Standard Oil Company of Ohio, or was it in the name of some of the individuals? — A. I pre- sume it was in the name of individuals, but T dont know. Q. Now, will you look at the list of individuals on page 51 who signed that trust agreement. — A. Yes sir. Q. According to the agreement (simply to call your attention to it) they purport to be the stockholders of the corporations on pages 41 and 42, do they not ? — A. Well, it may be so. I dont know the lan- guage of this paper at all. Q. Will you look at the names on page 61. Who was Mr. Benja- min Brewster ? — A. He was one of the Trustees of the Standard Oil Trust. Q. A stockholder in any of these companies? — A. I dont know. Q. Was he connected with any of these companies? 205 Mr. MiLBTJEN. I would like to note that all this testimony in respect to this trust agreement is subject to the objection that I made yesterday, that the questions refer to transactions that ante-date 100 TIUPOED. the time when the Act of 1890, commonly known as the Sherman Anti-Trust Act, went into effect. Mr. Kellogg. I understood all testimony of that kind was taken without renewing the objection. Mr. Mn.BUEN. You have got what Mr. Kellogg said there, so that we both understood it. A. Mr. Brewster was connected Avith the National Transit Com- pany when I had any information on the subject, but I dont know anything about these people or their positions until some years after the Trust was formed. Q. When did you commence in the oil business ? — A. In the service of the Standard? Q. Well, in the business in any capacity. — A. In 1869 or 1870. Q. With what company? — A. Bostwick & Tilford; my brother was the member. Q. Bostwick & Tilford were then connected with what com- panies ? — A. None that I know of ; they were partners. Q. Your brother? — A. That was my brother. Q. H. M. Tilford?— A. No, J. B. Tilford, Jr. He is not living now. Q. Mr. Bostwick afterwards became connected with certain Tran- sit companies, didnt he? — A. I dont know of my own knowl- 206 edge ; I was not connected with the company or with him when he went into the Trust. Q. How long were you with Bostwick & Tilford? — A. Well, I think about three years ; two or three years. Q. When did you become connected with the Standard Oil Trust or any of the companies the stock of which was held by the Stand- ard Oil Trust? — A. I became connected with the Standard Oil Company of Ohio, in 1878. Q. Before the organization of this Trust? — A. Yes sir. Q. Were you connected with it from that time down to the time the Trust was organized? — A. Well, not with that company, but with one or the other of the companies. But some of those companies I was afterwards connected with were not in the Trust originally, because they were formed afterwards. Q. When did you go into the service of the Trustees? — A. I be- came a Trustee in 1887 or 1888. Q. Were you the treasurer of the Trustees ? — A. I was not. Q. Who was the treasurer of the Trustees? — A. Benjamin Brew- ster was at one time; I dont know how long. Q. You became a Trustee in 1887?— A. In 1887 or 1888. Q. The Trustees had offices in New York ? — -A. Yes, sir. Q. At 26 Broadway at that time? — A. I think so; wherever the Standard office was. Q. They had a president, did they not? — A. Yes sir. 207 Q. Who was it?— A. J. D. Rockefeller. Q. They had a secretary, did they not ? — A. Yes sir. Q. Who was it?— A. H. M. Flagler. Tn^FOED. 101 Q. They had a treasurer ? — A. Yes. Q. And an auditor?— A. I dont know whether they had an auditor or not. Q. Will you look at the by-laws and see if that refreshes your recollection, page 243 of the bill of complaint. (Witness refers to the same.) A. I dont think that provides. Do you know what page it is on? Mr. Kellogg. Well, I dont think it provides for a president; treasurer, executive committees, page 243 to 248. Q. You were one of the Liquidating Trustees, were you not ?— A. Yes sir. Q. Were you also the attorney-in-fact of the Liquidating Trus- tees? — A. Yes. Q. Were you treasurer during the time of the Liquidating Trus- tees? — A. You mean of the Trustees? Q. Yes.— A. No. Q. Who was? — A. I dont know. Q. Did the Liquidating Trustees have a treasurer? — A. I dont know that. Q. The Trustees continued their officers during those years of liquidation, from 1892 to 1899, did they not? — A. I dont know that they did. 208 Q. You were a Trustee, were you not ? — A. I was Trustee — Liquidating Trustee, then, yes. Q. You also were one of the Trustees under the trust agreement, were you not? — A. Yes. Q. Well, during those years from 1892 to 1899, some of the stock of these twenty companies still remained unliquidated and in the hands of the Trustees? — A. Yes sir. Q. And the Trustees did keep up their organization during those years, did they not? — A. I dont know. They kept together to the extent of receiving the dividends on those certificates and distribut- ing to the stockholders or to the trustees. Q. In other words, all stock of the twenty companies which re- mained in their hands during the years from 1892 to 1899, received its prorata of dividends from the sub-companies ? — A. Yes sir. Q. The Trustees received those dividends in the same manner they had the dividends during the Trust period ? — A. Yes. Q. And they distributed them to the certificate holders? — A. Yes sir. Mr. MiLBUEN. I dont think that was so as to all the companies. Witness. No ; may I correct that, Mr. Kellogg ? Q. Correct it, if you wish to. — A. They distributed them to 209 the holders of Trust Certificates, and also to the holders of as- signment certificates who had not yet taken out their stocks in the separate companies. Mr. MiLBUEN. The point I had in my mind (I may be wrong about it) but it was that Ohio didnt pay any dividends. I dont know whether Mr. Tilford knows it or not. 102 TILFORD. Witness. I didnt Imow of it until Mr. Milburn spoke of it. I think the Standard Oil Company of Ohio was an exception. Q. Because of the suit in Ohio ? — A. Yes, sir, I had forgotten that. Q. Well, generally speaking, then, with that exception, if that is an exception A. Yes, sir. Q. The Trustees, during the period of liquidation, received the dividends upon the stock still in their hands, upon the liquidating assignments which had not been converted into stock of the sub-com- panies? — A. Yes sir. Q. And paid those dividends to the holders of the Trust certifi- cates outstanding? — A. They did. Q. And to the holders of liquidating assignments ? — A. Yes. Q. So the Trustees must have kept up their organizations? — A. Thej' probably had some kind of an organization, although, of course, I paid very little attention to that. Q. During those years, the Trustees voted the stock they held in these sub-companies, did they not? — A. They did. Q. And exercised the same control by stock ownership, to the ex- tent of the stock they owned, as they did before? 210 Mr. MiLBUKN. Oh, I must object to that question because it is altogether too leading, and drawing a comparison. Q. Was there any difference in their control over the stocks they owned after 1892 and that before? Mr. MiLBUEN. You are incorrigible. A. I dont know exacth' what you mean. Q. You dont know ? — A. No. Q. Well, prior to 1892, during the time the Trustees were in pos- session of the stock of these sub-companies, they voted the stock, didnt they ?— A. They did. Q. And elected the officers of the sub-companies? — A. Elected the directors, not the officers. Q. And elected the directors of the sub-companies ? Mr. MiLBUEN. Voted the stock they owned, I suppose you mean? Mr. Kellogg. Yes, voted the stock tlie^? owned. Mr. Milburn. Yes, that is right. Mr. Kellogg. Of course, they woidd not vote anybody else's. Q. And elected the directors of all these companies ? — A. Yes, sir ; all the companies of which they owned a majority of stock. Q. Yes, that is right. They owned a majority of stock of these twenty companies that were in the Trust, at the time of the dissolu- tion, didnt they ? — A. Let me look at that. Q. The list of those twenty companies I will show j^ou, on 211 page 62. — A. Yes, I think they did. Q. Well, then, during those years of the Trusteeship, down to 1802, they voted tluit stock and elected the directors in those com- panies every year? — A. Yes sir. Q. Well, after 1802 and during the liquidation period between 1892 and 1800 when these stocks were turned over to the Standard Oil TILFORD. 103 Company of New Jersey, the Trustees voted the stock which they held from time to time in the same manner, did they?— A. They did not. They did not vote any of the Liquidating Trust— I mean any stock lield after 1892. They only voted the stock they owned as in- dividuals. Q. Didnt the Trustees vote, between 1892 and 1899, the stock which still remained unliquidated? — A. They did not. Q. Are you sure of it? — A. Quite sure. Q. Have you the records to show that ? — A. I have not ; I know it from my information. Q. Are you an officer of the Standard Oil Company of New York? — A. I am. Q. Will you produce the book showing the vote? — A. Will I? Q. Yes. — A. I will, if I can find it. Q. During those years. — A. I will, if I can get it, yes. Mr. INliLBUEN. That is what ? Q. You are also an officer of the Standard Oil Company of New Jersey? — A. I am treasurer. Q. Some of that stock was held during that period of liquidation, wasnt it? — A. How do you mean? You mean some of the 212 uncancelled ten millions? Q. Yes sir. — A. Yes, that was held. Q. That was held during the period of liquidation? — A. Yes. Q. Some of the stock of each one of the companies (of the twenty companies) was held by the Trustees during the period of liquida- tion from 1892 to 1899, was it not?— A. I think so. Q. And that stock remained in the Trustees during those years, the legal title ? — A. I think so. Q. And that stock which they held they voted annually, didnt they? — A. I think not. Q. Do you know they didnt? — A. To the best of my knowledge they did not. Q. Have you any of the records of their meetings during those years? — A. I have not. Q. You have not ? — A. No. Q. How were the officers of the sub-companies elected, —the direc- tors? — A. Elected by the stock wliich had been taken out by indi- viduals. A majority of that was taken out at once in 1892, I think. Q. Have you got a list of the amount liquidated each year? — A. I have not. Q. Have you any record of it ? — A. I have not. Q. Is there any record in your office?— A. No, sir, not that I know of. Q. You were a Liquidating Trustee ; didnt you keep records of the liquidation? — A. I did not. 213 Q. Wlio did ?— A. I presume there was a clerk that did it, I dont know who. The accounting department probably did. Q. Which department?— A. I think Mr. L. D. Clark's department, but I am not sure. 104 TILFORD. Q. The comptroller's office? — A. Well, I dont know whether he kept it u^ comptroller, or how, but I think he had something to do with it. Q. "Well, what were the officers of the Trustees? — A. What do you mean by " what were they" ? Q. Did they have a comptroller's office also? — A. They did not. Q. A^Tiat was Mr. L. D. Clark's position ? — A. Why, only clerical, as far as the Trustees were concerned, as far as I recollect. Q. '\'\''ell, did he keep the books showing the liquidation from year to year ? — A. I dont know whether he did or not. Q. You were the attorney-in-fact of all the liquidating Trustees ?~ A. Yes. I didnt keep any accounts, and it is so far back I hardly remember. Q. Well, yoii know such accounts were kept, dont you? — A. Such as the outstanding certificates? Q. Yes. — A. I know they must have been, as a matter Mr. Rosenthal. Arent they shown in that ledger that you had ac- cess to ? Mr. Kellog<^. I dont know, yet. Mr. Rosenthal. I dont either, but I suppose they might be shown there. 214 Q. Let us get at the manner of the distribution. Prior to the dissolution of the Trust, the resolution of which was passed March 21, 1892. page 64 of that record that you have, or bill, the Trustees held the stock of the twenty companies named on page 62 which you have just identified? — A. Yes, sir. Q. Prior to that time they had turned over to the Standard Oil Company of New Jersey the stock of a large number of corporations, hadnt they?— A. Prior"to when,— 1882? Q. March 21, 1892.— A. Well, I don't know about that. Q. You don't know about that? — A. No. Q. But you do know they held the stock of these companies named? — A. Yes. Q. They passed this resolution (I wish to refresh your memory about this) dividing those stocks, all of them, into parts equal to the total number of Trust certificates outstanding, didnt they? — A. Prob- ably they did. Mr. MiLBtiEN. Look at it, Mr. Tilford. Q. I just want to refresh your memory, that is all. Mr. MiLBUEN. He may look at it, because that is a record. Mr. Kellogg. Certainly. A. What page is that ? Q. Pages 'U and e.l — A. Yes, it says that, and I have no doubt it was done. Q. That is true, is it ? — A. I have no doubt it was done in accord- ance with this ; I dont know. 21.5 Q. You then made out a legal assignment, signed by the Trustees, by you as attomey-in-fact, assigning to each holder of TILPOBD. 105 Trust certificates his share in all of the companies together, didnt you? — A. Yes. Q. You didnt make an assignment for each company, but one as- signment covering all the companies ? — A. I think so. Q. Will you look at the one made to Mr. John D. Rockefeller on page 67. Look it over carefully. — A. I have read it. Q. Now, then, Mr. Eockefeller, at the time of the dissolution of the Trust, owned 256,854 shares, out of a total of 972,500 shares of Trust certificates, didnt he? — A. I dont know; this says so, but I dont know it. Q. Well, that would appear so from that assignment, wouldnt it ? — A. It is stated here, but I dont remember what he had. Q. Well, that is a copy of the assignment, isnt it? — A. It purports to be ; I dont know, of course, whether it is or not. Q. It purports to be signed by j^ou as attorney-in-fact ? — A. It does in this book, and perhaps it is right ; I dont know. Q. That copy of the assignment is admitted here to be correct. Mr. MiLBURN. Yes, we have admitted that that Witness. All right, I am only speaking from my own recollection. Q. Now, then you assigned, according to that, to Mr. John D. Rockefeller 256,854/972,500 parts of the stock of all of 216 the corporations, didnt you? — A. Yes. Q. I am taking that one as an illustration. And that was done in the same manner with every certificate holder who presented his certificate^ '. — A. As far as I know. Q. So that each holder of a certificate issued by the Trustees of the Standard Oil Trust got one assignment assigning to him a pro- portion of all of the stocks of all of the corporations, in one instru- ment? — A. I presume that is so. Q. And those assignments were signed by you, as attorney-in-fact of the Trustees, were they not ? — A. Probably some of them. I dont know that I signed them all. There were several attorneys-in-fact. Q. Mr. Flagler was the secretary? — A. Seems to be so here, yes. Q. So that each certificate holder became an equitable owner by assignment of a proportion of the stocks of each and all of the cor- porations ; isnt that true ? Mr. Rosenthal. You mean the legal owner, not an equitable owner. Mr. Kellogg. Well, the assignment didnt make him a legal owner, The assignment made him an equitable owner. Mr. MiLBTJRN. You are asking Mr. Tilford Q. Became an owner in some form, I dont care how? — A. As far as I know, yes. ' Q. Now," if Mr. Rockefeller had 256,854 shares out of 972,500 shares of the Trust certificates after the assignment, he became 217 the owner of that proportion of each of the corporations ? — A. I should say so. Q. Now, he could not convert that certificate into corporate stock of one of the companies without the consent of the attorney-in-fact 106 TILFORD. of both the assignee and the assignor, could he? Will you look at the latter part of that agreement, as set out in the bill of complaint. (Witness refers to the same.) A. Well, I presume not, although I hardly understand the legal language you use. Q. In other words, the attorneji^-in-fact of jNIr. Rockefeller and the attorney-in-fact of the Trustees must obtain the certificates in all of the sub-companies ? — A. I imagine that is so. Q. Well, isn't that your recollection of the way it was done? — A. I think so. Q. In other words, every man had to take his share in all the com- jDanies and convert it in all of the companies at the same time? — A. That was what was done, anyway, as far as I know anything about it. Q. Do you know whether between 1802, the time you commenced the issuance of those assignments, down to the time this stock was turned over to the Standard Oil Company of Xew Jersey, whether any of the assignees or parties who took assignments of part of those stocks sold the stocks in one companjr and did not in the other? — A. I dont know that they did. 218 Q. Yon dont know that one single man ever sold his stock in one of the sub-companies without selling an equal percent- age in all? — A. I dont know anything about it. Q. You dont know anything about it? — A. No. Q. Did you?— A. I did not. Q. You kept your same percentage in all ? — A. I did. Q. And turned it in to the Standard Oil corporation? — A. I did. Q. Afterwards, and took your stock from the Standard Oil corpo- ration? — A. I did, for the stocks in the several companies. Q. Xow, isnt it a fact that every stockholder did the same? Mr. MiLBUEN. If he knows. A. Well, I dont know. Q. Have you any books in your office showing how that transaction was made? — A. I have not. Q. You were the fir^^t treasurer of the Standard Oil Company of New Jersey, were you not? — A. Not the first treasurer of the com- pany ; I was the treasurer in 1899. The company had been in exist- ence many years before that. Q. Well, I mean the first treasurer after the re-organization. — A. I think so ; I know I was in 1800. Q. And all stocks issued by the Standard Oil Company of New Jersey, in payment for the stocks of these companies which 219 had previously been in the Trustees, was issued through your office? — A. It was issued through the transfer office. Q. AVell, signed by you. were they not?— A. By me or one of the assistant treasurers; not all of them by me. Q. By you or one of your assistants? — A. Yes, sir. Q. The resolution under which this stock was to be issued in pay- ment directed or authorized you to sign it, or one of your assistants to sign it? — A. I think so. TILFOBD. 107 Q. Can you give me the amount of stock owned by Mr. John D. Kockefeller at the time of the dissolution, the amount of the trust certificates? — A. I do not know how much he owned. Q. Have you any record in your office showing it? — A. When you speak of my office, ]Mr. Kellogg, which do you mean ? I have an office of my own in the building there. Q. I am speaking of you as an officer of the Standard Oil Company of New Jersey, or of the Liquidating Trustees, or as a Trustee, one of those officers. — A. Now, put your question, please. Q. ITave you any records showing the amount of stock Mr. John D. Rockefeller owned?— A. I dont know whether there is any record in the office or not. Q. Will you look and see ?— A. I will. Make a memorandum, Mr. Chase. Mr. Chase. Yes sir. Q. I should like also to know the amount of liquidating cer- 220 tificates owned at the time of liquidation by Henry H. Rogers, William Rockefeller, H. M. Flagler, Oliver H. Payne, Charles Pratt, or the estate, I am not sure which ; C. M. Pratt, Stephen V. Harkness, and John D. Archbold. — A. You mean now the amount of Trust certificates that they owned ? Q. At the time of the liquidation. Mr. MiLBTjEN. At the time of the dissolution? Mr. Kellogg. At the time of the dissolution, on March 21/1892. Mr. MiLBUEN. Is that alleged anywhere? Q. "Will you also find out the amount of stock in the Standard Oil Company of New Jersey, issued to each one of these gentlemen after the re-organization in 1899, during that .year, and the subsequent years, for the stock which they held in these twenty companies, or nineteen companies ? — A. You dont include any stock they may have bought or sold or traded in afterwards? Mr. MiLBUEN. He may not know of it. Mr. Kellogg. Well, any stock they may have acquired from 1892 to 1899. How many certificates were issued to them of the Standard Oil Company, of New Jersey, stock? Mr. MiLBUEN. For their shares in the twenty companies ? Mr. Kellogg. Yes sir. Mr. JIiLBUEN. We have got it, Mr. Tilford. Mr. Chase has it there. Mr. Kellogg. Yes, ]Mr. Chase has that down there. Mr. MiLBUEN. He will give it to us. Q. Is it not a fact that all of the certificate holders, at 221 tlie time of the dissolution of the trust in 1892, continued to hold the same amount of stock in the sub-companies, or, if they sold any, they sold the same amount in each sub-company, so that the ownership stood the same in 1899 as it did in 1892 ?— A. I am unable to answer that. Q. Well, what is your recollection? 108 TUJPOBD. Mr. MiLBURN. How could he know what others did? How could he know what others did ? Mr. Kellogg. From his books. Mr. Mii^uEN. There are hundreds of people. Now, how can he tell? Mr. Kellogg. Well, can you answer that? Witness. I can not. Q. You dont know? "V\1ien you came to issue the stock of the New Jersey corporation in exchange for the stock of these twenty companies, a resolution of the board of directors was passed, which I show you, was there not? (Handing witness paper.) — A. All right; I see it. Q. What is your answer? — A. What is the question, Mr. Kellogg? Q. That resolution was passed by the board of directors of the New Jersey corporation, was it not ? — A. I have no doubt of it. Q. Under that resolution, the same number of shares of stock of the New Jersey corporation was issued as previously had been out- standing of the Trust certificates issued by the Trustees, rep- 222 resenting the same corporation? — A. You \vish me to saj^ yes or no to that? Q. Yes sir. — A. I don't know whether there were exactly the same or not. Q. How many trust certificates were there issued and outstanding representing those twenty corporations at the time of the dissolu- tion in 1892 ? — A. I dont remember. Q. Have you any record that shows that? — A. I don't know whether there is a record in the office or not. Q. Wasnt it $97,250,000 trust certificates? — A. It may have been, Mr. Kellogg, but I have no recollection of the exact figures. Q. You have no recollection of it? — A. No sir. Q. Have you any book from which you can refresh your recollec- tion? — A. I dont know; I certainly have not in my own office; I dont know what is in the treasurer's office. Q. Well, your office has the record of the stock issued, has it not? — A. You mean of the New Jersey stock? Q. Yes. — A. Yes, sir. Q. You mean as against the shares of those twenty companies you have issued $97,250,000 of trust certificates? — A. I dont remember; I cant answer from memory. Mr. MiLBURN. Now, if you want him to verify those figures he will do so, Mr. Kellogg. He hasnt them in his mind. Mr. Kellogg. All right; please verify those figures. Witness. Please give me a memorandum of it. 223 Mr. Chase. All right, I will put it down. Mr. MiLBURN. A man doesnt carry those things in his mind. Now the answers admits, in this case, so he need not verify this, he can assume it, that at the time of the dissolution of the so-called Trust created by the agreement on March 21, 1892, there were $97,250,000 TILPORD. 109 of the shares of such Trust certificates. Now there is the admission of the answer to the defendants, so we need not debate about that. Q. Well, assuming that to be true, those certificates represented the ' stock of these twenty companies, did they not? — A. You mean the Trust certificates represented? Q. Yes sir.— A. Well, they represented the ownership of them. Q. Yes, the ownership of them? — A. Yes. Q. You issued an equal amount of stock in the Standard Oil Com- pany of New Jersey, didnt you?— A. That I would have to verify. Q. AH right, verify that, then. Was not this basis adopted in this resolution so as to give the owner of a Trust certificate share, previous to the dissolution, or his assignee, the same amount of stock in the Standard Oil Company of New Jersey? — A. I dont know of any such discussion at all. Q. You dont know of any such discussion? — A. No? Q. It works out that way, doesnt it? — A. It looks so. Q. 'i'ou had some of your own, didnt you? — A. I did. Q. You got the same amount, didnt you ? — A. I presume I did. Q. Now, if yoit did, everybody else did, didnt they? — A. 224 Well, I think that is quite likely. Q. You wouldn't get A. I wouldnt get any different from anybody else, of course. Q. Now, as a matter of fact, Avasnt that the object? — A. Well, I cant tell you ; I never heard that discussed. Q. Who got up that scheme or reorganization ? — A. Who got it up ? Q. Yes. — A. I dont know. Q. You hadnt anything to do with it ? — A. No, I dont think I did. Q. You were one of the directors and the treasurer of the Standard Oil Company of New Jersey, werent j'ou? — A. Oh, you mean the scheme as set forth in that resolution ? Q. Yes sir. — A. I presume the accountants got that up; got up a scheme whereby it showed what each man was entitled to. His fig- ures were, no doubt, embodied in that resolution. I dont suppose I ever figured it at all. Q. Well, after the dissolution of the Trust, who got up this plan to place these same stocks in the treasury of the Standard Oil Com- pany of New Jersey ? — A. I dont know that. Q. You dont know anything about it? — A. No. I presume they were advised by counsel ; I dont know. Q. Well, you were treasurer of the new company ? — A. Yes. Q. And a director of the new company ? — A. Yes. Q. And a liquidating trustee ? — A. Yes. 226 Q. And one of the trustees under the trust agreement? — A. Yes, sir. Q. And a stockholder? — A. Yes sir. Q. Both of the Trust and of the Standard Oil Company of New Jersey afterwards. Prominent, were you, in the management of the affairs of the company ? — A. I wouldnt like to say I was prominent. 110 TILPORD. Mr. MiLBUEN. You see we are all naturally modest — on our side. Mr. Kellogg. Except as to your profits. Mr. MiLBUEN. Oh, well, we have an eye to the main chance. Q. Have you any knowledge of who got up the plan of reorganiza- tion '. — A. VVhy, I have no doubt it was onr attorney, ^Mr. Kellogg. I cant absolutely say, but I have no doubt of it. Q. I again ask you if it is a fact that that plan was adopted to give the certificate holders under the Trust an exactly equal amount of stock of the Standard Oil Company of Xew Jersey? — A. I havent any knowledge that would enable me to answer that question. Q. You simply know it worked out that way? — A. Yes, I know that. Q. Where are the original Trust certificates? — A. I dont know. Q. x\s they were redeemed, they were taken in by j'ou and your association as Liquidating Trustees, were they not? — A. I should think they would come to the Trustees, yes. 226 Q. Did you ever see any of them? — A. I dont think I ever did after they were cancelled, or except at the time that they were cancelled. I may have seen them. Q. As they were turned in from year to year during the years of liquidation, and assignments made, you took them, did you? — A. Not personally, no. Q. "Well, who did?— A. Why, I dont know; I presume whoever was the clerk. The secretary would be the natural custodian of them. Q. Where are the assignments? — A. Of legal title? Q. Of legal title. — A. I dont know where they are. Q. They would be surrendered to the several companies, wouldnt they? — A. Probably. Q. You dont know where they are? — A. I do not know, no. Q. Where are the sliares and fractional sliares of these twenty companies which were turned in to the Standard Oil Company of New Jersey, and the stock issued for them? — A. I presume they are in the possession of the New Jersey corporation. Q. Who has the possession of its certificates of that kind? — A. I dont know whether the securities committee would ha^•e those or not. Q. Does your office? — A. Not that I know of, I think not. Q. Now, during the years of liquidation, you say your recollection is that the Trustees did not vote any stock? — A. Any stock except that which they owned individually. Q. Except which they owned individually ? — A. Yes sir. 227 Q. Did the Trustees during liquidation own the majority of the stocks of all the sub-companies ? — A. I dont think they did. Q. Did they own enough to control them by election of directors ? — A. When you say "control," what do you mean by that? Q. Elect the directors. — A. Couldnt elect them without getting proxies from other stockholders. Q. Did they get proxies from other stockholders and elect the directors during those years? — A. They did. TILFORD. Ill Q. They did? — A. That is, somebody got proxies; I dont know who the individuals were. Q. Is it not a fact that the Liquidating Trustees procured the proxies and that the stock they owned themselves elected all the directors of those twenty companies during those years?— A. Some individuals obtained proxies; I dont know who they were. They may not have been trustees or liquidating trustees; they may have been other individuals, I dont remember. Q. Well, I asked you if the Liquidating Trustees did not do it.— A. Well, I have no recollection about that. I dont know who got the proxies. Q. Do you know of any particular change in the management of the business of the twenty companies during those years? — A. Well, I couldnt answer that without you specify what you mean by " par- ticular change.'' Q. The directors were elected in substantially the same way, werent they? — A. They were elected in the same way that all 228 directors are elected, as far as I know. Q. No change made in the officers, that you recollect? — A. The officers were changing frequently. Q. Can you tell how much stock the Liquidating Trustees had in their hands during those years? Mr. MiLBUEx. Do you mean, Mr. Kellogg Mr. Kellogg. Of the sub-companies. Mr. MiLBURx. Xot to have any confusion here — as individuals or as trustees? Mr. Kellogg. As individuals. Witness. I can not. Mr. MiLBuuEN. They would not have as trustees. I do not think you meant to suggest to him that the Trustees as Liquidating Trus- tees got proxies, when they were enjoined from voting. Mr. Kellogg. They were not enjoined from voting. Mr. MiLBURN. In Ohio. Mr. Kellogg. Only in Ohio. Mr. MiLBtJEN. They had dissolved. Q. During the period of the trusteeship, when the trustees had control of these corporations through their stock ownership, outside of your business as a trustee of the Trust, what branch of the business were you engaged in ?— A. I can state the companies that I was con- nected with ; I was an officer of various companies. 229 Q. What companies? — A. I was the president of the Stand- ard Oil Company of Kentucky from 1886 to 1889. Shall I go on with the rest of them? Q. From 1886 to 1889?— A. Yes. Q. Were you afterwards connected with it at all ?— A. As a direc- tor, but not as an officer. Q. As a director? — A. Yes. Q. From 1889 to what time?— A. To the present time, I think. 112 TILFOBD. Q. To the present time. Give the rest of them. — A. In 1885 I was vice president of the Standard Oil Company of Iowa; in 1891 I be- came its president. Q. How long did you remain its president? — A. Until the spring of the present year. Q. What other companies? — A. I was president of the Union Tank Line in 1891. Q. How long did you remain that? — A. Until Avithin a year or two. Q. What other companies? — A. I was president of the Standard Oil Company of Indiana from 1889 to 1890, and I went back into the presidency of that a year or two later and continued until about three or four years ago. Q. What other companies? — A. That is all. Q. Were you a director in many of these companies ? — A. Not in a great many ; I was a director in several. I was a director, of course, in all those companies at the time I was an officer. 230 Q. Now, is there anywhere in the Standard Oil building, among any of its officers, a list of its officers, a list of the offi- cers and directors of those companies during the Trust period and the period of liquidation? — A. I dont know. It is not in the treas- urer's office. Mr. IMiLBUKx. What is that bundle? Oh, that in only the list at the present time. (Referring to Petitioner's Ex. 18.) Mr. Kellogg. That is the list at the present time. Q. It is not in the treasurer's office ? — A. No. Mr. Rosenthal. I think that is kept by card index, and as the officers changed I apprehend the cards have been changed. Q. Now, you were an officer, during the period of liquidation of some of these companies, continuously ? — A. Yes. Q. Is it not a fact that, generally speaking, except changes that were made for convenience, the officers continued right throiigh the period of liquidation as they did before? — A. No; there were many changes; I cant recall them all. Q. Well, there are always changes in corporations. — A. Yes, and there are plenty of them in ours, in officers. Q. But there were no sweeping changes in 189;:: at the time of liquidation, weie there? — A. I dont remember about that. Q. You don't remember about that? — A. No, I dont remember all the officers of the oil companies. Q. Your office didnt seem to be changed. — A. They were changed pretty often, I think. Q. You were not required to resign when the Liquidating Trustees were appointed, were you ? — A. No, sir. 231 Q. Nor asked to resign? — A. No sir. Q. And you were re-ekcted in some of the companies ? — A. I was re-elected in some of the companies. Q. And many other of the employes were re-elected in the same way, werent they? — A. I dont know about that. TrLFOED. 113 Q. Dont you know of a good many men connected with the Stand- ard organization in 1892, and the years previous, that continued in their same positions in the year 1892 and the years following? — A. I do not. I think the chances are they were not in their same positions, many of them; probably promoted. Q. Yes, probably promoted ; I presume they were. — A. Changed to other companies. Q. But they stayed in the organization somewhere, most of them, didnt they? — A. Well, quite a number did; I wouldnt want to say how many. Q. Then you dont pretend to saj'- that tht liquidation which was started in 1892 changed in any degree the management of any of those companies, do you? — A. I do not. Q. It did not, did it ? — A. Kot that I know of. Q. The management continued substantially the same? — A. I wouldnt like to answer that. I dont know of any serious changes. Q. I didnt suppose there were. Mr. MiLBrRx. I dont see how they could if they wanted to; so we are all agreed about that. Mr. Kellogg. All right. It takes quite a while to get at an agree- ment. 232 Q. Xow, tllo^e corporations continued, from 1892 down to 1899, to make the same reports to your office that they had made previously, didnt they ? — A. I am not familiar with the records at all. I have nothing to do with the clerical work. Q. ^Vell, you know they did make reports ? Mr. MiLBUEN. To what? Mr. Kellogg. To the Liquidating Trustees and to the Trustees during those years. Dont you ? — A. I know that some reports were made as to results of business, but I dont know whether they were the same or what they were. Q. Take the Standard Oil Company of Indiana: you were con- nected with that during the liquidating period, as president, were you not? — A. Yes, I think I was. Q. The Standard Oil Company of Indiana is a very large manu- facturing company, isnt it? — A. Yes sir. Q. With offices at '\'\Tiiting, Indiana ?— A. Yes. Q. During the time of the liquidating trusteeship, while you were president of that company, what reports did it make?— A. I dont know. The business was almost entirely in the hands of the vice president, Mr. Moffatt, who lived in Chicago. I simply presided at the meetings and signed certain papers at times. I did not man- age the business. Q. You knew of no change in the business brought about by the liquidation, do you?— A. In what way? Q. As to the manner of making reports to the New York 233 office.— A. I dont know what reports they make, and I dont know what they made then. 32555—08 8 114 TIIiFOED. Q. You dont? — A. No, sir, I have nothing to do with them; dont come in contact with them at all. Q. Do you now receive in your office reports from any of those companies? — A. In the treasurer's office? Q. Yes. — A. It is possible. I dont know. Q Do you give any attention to the business of the treasurer's office? — A. Only in the way of general supervision. Q. Who does?— A. The assistant secretary, Mr. William G. Rocke- feller, or Mr. William B. Howe. Mr. MiLBUEN. The assistant treasurers, you mean? Witness. The assistant treasurers, yes. Excuse me. Q. They would know what reports are made from all the Standard Oil companies? — A. To their office, yes sir, I presume they will. Q. How do you happen to know just what stock was voted at the meetings of these sub-companies — these twenty companies — from 1892 to 1899 ? — A. You mean that I happened to know that the stock which had not been turned in was not voted? Q. Yes. — A. I was under the impression that we were enjoined from voting it. Q. That is only in the Standard Oil of Ohio, is it not ? — A. I didnt know until I heard you and Mr. Milburn talk. I supposed it was. Some injunction we obeyed, anyway, as far as I know. I dont know where it was, sir. 234 Q. It was a suit in Ohio, was it? — A. I just heard it stated here ; I dont remember. Q. You are not president of the Standard Oil Company of Indiana at the present time ? — A. I am not, nor have I been for several years. Q. What companies are you connected with at the present time? — A. Standard Oil Company of New Jersey and the Standard Oil Com- pany of New York, but I am a director in three others. Q. What others? — A. The Standard Oil Company of Kentucky, the Standard Oil Company of Indiana, and the Atlantic Refining Company of Pennsylvania. Q. During these years you have been rather active in the business of the Standard Oil Company, havent you? — A. Rather so, yes, sir. Q. Do you know Mr. H. C. Folger?— A. I do. Q. "Wliat is his business? — A. Connected with the manufacturing department of the Standard Oil Company. Q. What are his duties? — A. In connection with the manufactur- ing department. Q. All of the manufacturing departments? — A. No, I dont know that he is. He is connected with the Standard Oil Company of New Jersey, as far as I know. Q. Does he have charge generally of refineries controlled by the Standard Oil Company of New Jersey? — A. I dont think so. Q. You dont think so? — A. No. Q. Just the Standard Oil Company of New Jersey ? — A. And pos- sibly New York. TILFOKD. J 15 Q. And possibly of New York?— A. Yes, sir. 235 Q. How long has he been in that position?— A. I do not know. Q. How long have you known him?— A. I could not tell you that. A good many years. Q. Well, he has been with the Standard Oil Company a good many years? — A. Yes sir. ' ' • Q. And Mr. C. N. Payne?— A. Yes, I know him. Q. How long have you known him?— A. Oh, quite a mumber of years. Q. What is his business?— A. He is connected with one or more of the pipe lines. Q. The pipe lines of the companies? — A. Yes, sir. Q. The Xew York Transit Company?— A. I cant name the lines. I know he is connected with the pipe line business. Q. And has been for many years? — A. Yes sir. Q. Offices at 26 Broadway?— A. Mr. Payne's haA^e not been here- tofore until recently. Mr. Folger's are, and Mr. Payne's are now. Q. Did you ever hear of the Corsicana Refining Company of Texas? — A. I have heard of an oil company at Corsicana, Texas, I dont know the name of the concern. Q. \Vhat? — A. I have heard of an oil business at Corsicana, Texas; I dont know the name of the concern. Q. You did not?— A. No. Q. Do you know that Mr. Folger and Mr. Payne are co-partners ?— A. I have heard that they had an interest somewhere down there in the business, in Corsicana. Q. Corsicana? — A. Yes. Q. When did they get that business ? — A. I dont know any- 236 thing about it. Q. You dont know anything about it? — A. No sir. Q. How large a refinery is it ? — A. I dont know that. Q. How long has it been in existence? — A. I dont know that either. Q. ^Vhere does it get its product ? — A. I dont know that. Q. "^ATiere does it sell it? — A. I dont know that. I dont know any- thing about its business. Q. Did you ever inquire into it at all ? — A. No sir. Q. You heard that Mr. Folger and Mr. Payne own it, did you? — A. I did not. I heard that they had some interest in Corsicana in the oil business. Q. In the oil business? — A. Yes. Q. You know nothing of it whatever? — A. I do not. Q. Has the Standard Oil Company of New Jersey, or any of the companies in which it owns stock, any business relations with the Corsicana Refining Company? — A. The Standard Oil Company of New Jersey has none that I know of, and I cant answer as to any other company. Q. You cant answer as to the others? — A. No. 116 TILFOED. Q. Has the Standard Oil Company of New York ?— A. Not that I know of. Q. Does it buy any oil from the Corsicana Eefining Company ?— A. Not that I know of. Q. Would you know it if it did ? — A. Not necessarily. Q. What is your position with the Standard Oil Company •237 of New York?— A. One of the vice-presidents. Q. Active in its management? — A. Not specially so. The other vice-president is more active than I am. Q. You never heard, in any of the meetings of the Standard Oil Company of New Jersey, of your directors and officers, the subject of the Corsicana Eefining Company discussed, or its ownership? — A. I have no recollection of it. Q. You know the Waters-Pierce Oil Company, dont you? — A. I do. Q. You knew the old Waters- Pierce Oil Company? — A. I knew it, yes. Q. Were you connected with that organization at any time? — A. I was a director of the old Waters-Pierce Company in 1885, 1886 and 1887. I have not been connected with it in late years. Q. That is the company that the Standard owned the majority of stock of? — A. Yes sir. Q. Down to 1900 ?— A. I think so. Q. You heard the testimony of Mr. Pratt as to the holding of the stock since 1900, did you ? — A. Yes, most of it ; I presume I may have missed a little. Q. Were you familiar with the holdings since 1900? — A. Some- what. If you will put questions I will tell you whether I could answer. Q. You knew when the new company was organized ? — A. I Ivuew that it was organized, in a general way, yes, in 1900. Q. And were you consulted about it? — A. I was not. Q. Any of the officers of your company, as far as you know? — A. Not as far as I know. Q. You don't know. What was the reason for organizing 238 the new company? — A. Well, I only know what was stated in the press ; organized to succeed the old one in Texas. Q. In Texas ? — A. Yes, that is all I know about it. Q. Because the old company had been ousted? — A. That was the general rumor. Q. You got your information from the public press? — A. And hearsay. Q. Who from — Mr. Pierce? — A. I may have heard him say it; I cant tell you. Q. You know Mr. H. Clay Pierce? — A. I know him very well. Q. Had consultation with him about it? — A. I dont think about that. Q. Did he ever talk with you about it? — A. He may have, but I dont remember. I dont see him very frequently. TILFOBD. 117 Q. Was that your understanding of the reason for the organiza- tion ? — A. Because of the Texas Q. Yes. — A. That is my understanding, yes. Q. It was necessary to get a new Waters-Pierce Company to get it into Texas ? — A. That is my understanding. Q. Well, you knew, did you not, that the State of Texas would not permit a company owned by the Standard Oil Company of New Jersey to do business in Texas ? — A. I did not. Q. Well, you heard it, didnt you? — A. Well, I have heard doubts expressed on the subject, but I never heard anything definite about it. Q. Isnt that the reason that the Corsicana Refining Company is in the name of Mr. H. C. Folger and Mr. C. N. Payne?— 239 A. I cant answer that. Q. Do you know whether the Waters-Pierce buys all their oil, or any of it? — A. I do not. I am not familiar with their busi- ness in any detail at all. Q. You are not ? — A. No, sir. Q. Who is familiar with that business in your organization? — ■ A. I dont know that anybody is familiar with its present business. We know very little about it. Q. Who was familiar with it prior to the reorganization of the Waters-Pierce ? — A. I dont know that anybody was familiar with it. Q. Do you know Mr. McNall ? — A. I do. Q. Was he familiar with it? — A. I doubt if he was familiar with it. He was their agent here in New York. Q. Were not reports sent to 26 Broadway every day from the Waters-Pierce ? — A. Now ? Q. Yes. — A. No, sir, I dont think so. Q. Were they not sent during the last few years? — A. I dont think so. Q. Do you know whether they were or not ? — A. I do not. Q. Mr. Payne and jNIr. Folger are pretty prominent men in the Standard Oil, arent they ?— A. Fairly so. Q. Is it a common thing for the officials of the Standard Oil Com- pany to own competing businesses outside? — A. Not a common thing, no. Mr. MiLBUEN. Not a competing— well, I wont break in. Q. Well, the Corsicana Refining Company is refining oil in 240 competition with the Standard Oil Company, isnt it?— A. I dont know. Q. If it is refining oil and selling it, it must be selling it in com- petition with the Standard Oil ? Mr. MiLBUEN. That does not follow. Mr. Kellogg. No, I dont think it really does. Mr MiLBTJEN. It does not follow that anybody refining oil any- where is in competition with every other oil company in the United States. . . Mr. Kellogg. You are willing to admit they are not domg it m competition with the Standard Oil, are you ? 118 TILFOKD. Mr. MiLBUEN. You know how I said it. I was rebutting the idea that a refinery in Texas, for instance, was necessarily a competitor of a refineiy in Wlaiting or in New Yorli. One has one market and the other has another market. Q. Well, which way is it ? Is it in competition with the Standard, or is it not ? — A. I dont know. Q. You do not know ? — A. I dont know anything about it. Q. Well, do you know of any other prominent officials of the Stand- ard Oil Company who own refineries in their own name and do busi- ness ? — A. I do not know that they do. Q. Well, if they do? Mr. Rosenthal. The question is, if they do, do you know of any others ? Mr. Kellogg. Yes sir. A. I do not. Q. How long have you understood that they were interested 241 in the Corsicana ? — A. Not a very long while I think. Q. When did you find it out ? — A. I dont remember. Q. Was any action taken by the officials of the Standard Oil Com- pany of New Jersey on the subject? — A. Not to my knowledge. Q. Do you know of the Security Oil Company of Texas? — A. I know there is such a company ; that is, I know it by hearsay. I have not seen it, or I have not seen the refinery. Q. How long have you known of it ? — A. A number of j^ears. Q. A number of years ? — A. Yes, sir. Q. Well, how many? — A. I couldnt tell you. Q. Since about 1900 ? — A. I couldnt give you any estimate of that. Q. Well, what do you know of the Security Oil Company? — A. I know nothing of my own knowledge. Q. Well what have you heard of it? Mr. MiLBUEN. Now, I object to that. Mr. Geeee. I object to that as calling for hearsay. Mr. MiLBUEN. So do I object to it for my defendants, on the same ground. Q. Please answer the question. — A. What is the question now? The last question was read. A. 1 have heard it had a refinery in Texas. Q. Who owns the stock of it? — A. I dont know. Q. Has the Standard Oil Company of New Jersey any interest in it, directly or indirectly ? — A. Not to my knowledge. Q. Do you know whether it has or not? — A. I dont know that it has. It has none to my loiowledge. That is the only way I can put it. 242 Q. Do you know Mr. H. C. Bayne, president of the Sea- board National Bank? — A. I know Mr. Bayne, yes. Q. Has he any interest in it? — A. I dont laiow. I have heard that he was president, but I dont know anything about it. TILFOED. 119 Q. Has the Standard Oil Company any companies or does it own any stock in any companies except the Waters-Pierce Company, doing business in Texas? — A. Not to my knowledge. Q. Has it any properties in Texas? — A. Not to my knowledge. Q. Or any companies in which it owns stock ?— A. Doing business in Texas? Q. Yes sir. — A. Not to my knowledge. Q. Then, with the exception of the Waters-Pierce Company, the Standard Oil Company owns no stock or interest of any kind in any business concern doing business in Texas ? — A. Not to my knowledge. Q. Well, do you mean it does not, or you dont know ? — A. I dont know that it does. Q. Do you know that it does not? — A. Well, it does not to my knowledge, I mean. Q. You simply do not know whether it does or not ? — A. No, sir, it does not to my knowledge. Put it that way. I do not know. I think it does not. Q. I want it accurately. I dont want to put it any w;it. I want you to tell me what your knowledge is of the subject. — A. Vrell, I say I cant tell you anything, but that there is nothing on the loooks or records of the Standard Oil Company of New Jersey that I know about that shows any such ownership. Q. Does it receive any income, directly or indirectly from 243 any company doing any business in the State of Texas other than the Waters-Pierce Company ? — A. Not to my knowledge. Mr. EosENTHAL. Would it make any difference in this case, Mr. Kellogg ? We are not trying a case in the State of Texas. Q. Does it own any wells at Beaumont, Texas ? — A. The Standard ? Q. Yes. — A. Not that I know of. Q. Did you ever know of the Manhattan Oil Company? — A. Yes, sir, I have heard of it. Q. How many years have you known of that? — A. A good many; I cant tell you how many. Q. More than ten years? — A. I dont know whether it is that much ; I should say it was anyway more than five. Q. Do you know Mr. E. C. Benedict and Anthony Brady? — A. I do not. Q. You have known of the Manhattan Oil Company more than five years, you say? — A. I have heard of it more than five years, I think. Q. You are pretty familiar with the situation out in Ohio and Indiana, are you not? — A. In what respect? I am not familiar with any of the local things, no. Q. You were president of the Standard Oil Company of Indiana for many years? — A. Yes, but that did not make me familiar with things in Ohio and Indiana. Q. That refinery is connected with the pipe lines of the Stand- ard A. Yes. 120 TILFORD. Q. In Indiana and Ohio? — A. I presume it is. Q. Well, you know it is, dont you?— A. In what way do 244 you mean know it? Of my own knowledge? Q. Well, I dont mean you have been there or looked at the pipes. — A. Oh, I have no doubt of it. I have no doubt of it. Q. And for many years before the construction of the pipe line from Kansas to Whiting it received its crude oil from those states?— A. It did. Q. And the Manhattan Oil Company has, for many years, been doing business in Ohio, hasnt it? — A. I am not able to answer that. I dont know anything about the Manhattan Oil Company's business. Q. Do you know Mr. F. P. Cuthbert or F. T. Cuthbert?— A. I do not. Q. President of the Manhattan Oil Company? — A. I do not. Q. Never heard of it ? — A. I wont say I never heard of it ; I dont know him. Q. Do you know what business he was in before he became presi- dent of the Manhattan Oil Company ? — A. I do not. Q. Wasnt he connected with some of the Standard Oil com- panies? — A. I dont know. Q. Wasnt he connected with the National Transit Company? — A. I dont know. Q. Do you know Mr. E. R. Curtin, vice-president? — A. I do not. Q. Was he connected with any of the Standard Oil companies?^ A. I dont know. I never heard of him. Q. Do you know Mr. Louis Piatt, secretary? — A. I do not. Q. Was he connected with any of the Standard Oil Com- 245 panics? — A. I dont know. Mr. Kellogg. Mr. Milburn and jMr. Rosenthal suggest that they would like an adjournment now,. and under the circumstances I think it is reasonable. The Examinee. The hearing stands adjourned until 2 o'clock. Afternoon Session. The Examinee, On account of the illness of one of the counsel, the. further hearing of the case will be postponed until to-morrow morning at 10:30. 246 Friday, 8epteniJ)er W, 1907. The hearing was resumed pursuant to adjournment at 10:30 A. M. Wesley H. Tilford, recalled as a witness on behalf of Petitioner, testified as follows: Direct-examination (resumed) by Mr. Kellogg: Q. Have you some statements that I asked you to prepare yester- day? — A. All that I could get, except one. Q. Let me see what they are, so as not to encumber the record. I asked you about the dividend of the Standard Oil Company of New TILPOED. 121 Jersey for the year 1899, as to whether it was $14,304,188.50, or whether it was $32,008,541. — A. 14 millions and whatever that exact amount is. Q. $14,304,188.60?— A. Yes sir. Q. Now, isnt that explained, Mr. Tilford, in this way : That dur- ing the year 1899 the subsidiary companies did not pay all of the dividends of that year to the Standard Oil Company of New Jer- sey? — A. I think it is. Q. And that the dividends that went to the stockholders of the sub- sidiary companies, part of them being, or during part of the time being the Standard Oil Company of New Jersey, and the rest of the time the individuals, was about $32,000,000 ? — A. That I dont know. Q. Well, would Mr. William G. Rockefeller, the treasurer, 247 be able to locate that in his office ? — A. I dont think so. You see it would not appear in his office. Individuals only would have that. Q. It would appear, would it not, in the Comptroller's office? — A. No, I think not. Q. Wliat is your recollection about that? — A. I havent any. Q. No recollection at all? — A. No, sir, it is so far back. Mr. MiLBURN. Well, Mr. Tilford, I have understood that your recollection goes to the extent of what you said to Mr. Kellogg, that there were, no doubt, dividends declared by the subsidiaries to their stockholders, prior to the acquisition of the stocks hj the Standard Oil Company of New Jersey, during 1899. Witness. You will have to state that aiiain, Mr. Milburn. Mr. MiLBUKN. I say have you any recollection of the general fact that in 1899, prior to June, when the stocks began to be acquired by the Standard Oil Company of New Jersey, that the subsidiary com- panies declared dividends which went to their stockholders. Witness. Yes, I have no doubt of that. Mr. MiLBUEx . You have no doubt of that ? Witness. Yes, I have no doubt of it, but I dont know it. Q. Now, the Standard Oil Company of New Jersey did not acquire any of those stocks until at least after June 19 ; the dividends 248 before that, during that year, from the subsidiary companies were paid direct to the stockholders of those companies ?^A. Yes, to the stockholders. Q. Or to the Trustees, to the extent they held stock?— A. Yes, sir. Q. But whatever those dividends were, they were from the same sources that the Standard paid its 14 millions? The same compa- nies? — A. Probably. Q. What other statements have you?— A. You asked me to produce a record to show whether the Liquidating Trustees voted any stock left in their hands. Q. Yes sir.— A. So far as New York is concerned. Q. Yes.— A. I have here, found among the papers of the Stand- ard Oil Company of New York, this list of stockholders who voted at the annual meeting January 7, 1896. 122 TILFOKD. Q. Let me see it, will you, please. — A. Certainly. Mr. MiLBURN. Well, all those papers are one. That is the New York election. 1896 is the one he has cot here. Witness. That is all right, just those two. Mr. MiLBUEN. There was the oath, but that doesnt matter. Witness. Well, that was only the oath of inspectors. Mr. MiLBURN. That is the original memorandum of votes cast and the original certificates. Q. I asked you if there were $97,250,000 Trust certificates out- standing against the stock of the twenty companies at the time they dissolved. — A. Yes. 249 Q. You have verified that, have you ? — A. I have no means of verifying it. Q. Oh, you have no means? — A. No, sir. Mr. Kellogg. Well, that was admitted yesterday to be true. Mr. MiLBURN. It is admitted in the answer. Witness. All right. Mr. Kellogg. I am just refreshing his memory. Q. Now, for the stocks of those subsidiary companies, the same companies, which were held by the Trustees, how many certificates of the Standard Oil stock of New Jersey have been issued up to the present time? — A. 972,492 shares. Q. That would leave how many shares or fractional shares of the subsidiary companies outstanding which have not come in yet? — A. Well, I could not answer that. This represents everything that has been presented. Q. There are eight shares of the Standard Oil Company of New Jersey stock less than the certificates outstanding before that — the Trustees' certificates? — A. There are eight less than the outstanding certificates of the Trust, — outstanding Trust certificates. Q. Well, now, then, some of those fractional shares of subsidiary companies are not in? — A. Are not in. Q. And isnt it your understanding that those eight shares repre- sent those outstanding fractional shares of subsidiary compa- 250 nies that have never come in? — A. Well, it probably does. Of course, I cant answer about that. Q. If they should come in, those eight shares would probably be issued, wouldnt they? — A. I dont know whether they would or not. Q. At the time we adjourned yesterday we were inquiring about the Manhattan Oil Company ; how many years you knew of that com- pany being in existence? — A. I dont recall. Q. Well, prior to 1889, dont you ? — A. I dont know whether is was or not, Mr. Kellogg. I cant remember that far back. Q. You were the president of the Union Tank Line Company, at one time, were you not? — A. Yes sir. Q. During what years, do you remember? — A. From about 1891 until a year or two ago. TILFORD. 123 Q. Is it not a fact that the Union Tank Line Company bought the tank-cars of the Manhattan Oil Company during the year 1898 or 1899 ?— A. I dont know. Q. Who would know?— A. The vice president would know, per- haps. Q. Who is he?— A. H. E. Felton. No, he is president now ; he was vice-president then, I think. Q. He was vice president then ?— A. I dont know whether he was vice president that far back or not. I can find out.for you though. Q. "Well, I want to know. Mr. MiLBUEjj. All right, make a note of that. 251 Witness. I dont think Felton was vice president that far back. Q. Is it not a fact that the Ohio Oil Company, one of the Stand- ard's subsidiary companies, bought the producing wells of the Man- hattan Oil Company about the same time? — A. I dont know that, either. Q. Can you find that out? — A. I can not. Q. ^YhJ not? — A. I have had no connection with the Ohio com- pany. Q. Well, you do with the Standard Oil Company of New Jersey ? — A. Yes sir. Q. The Standard of New Jersey owns it? — ^A. It does. Q. You have some way of getting at the Standard of Ohio, havent you ? — A. I can go to the offices of the president. Q. He would be apt to give it to you, would he not? — A. I dont know. I would ask him and see. Mr. MiLBUEN. Make a note of that. Mr. Chase. All right, I have it. Q. Is it not true that about the same time the Solor Refining Com- pany, one of the Standard's subsidiary companies, bought the refinery of the Manhattan Oil Company ? — A. I dont know. Q. You know the Solar Refining Company ? — A. Yes, I do. Q. One of the companies of the Standard Oil Company ? — A. Yes sir. Q. Doing business in Ohio ? — A. But I have nothing to do 262 with its business. Q. Well, you can find that out, cant you? — A. I dont know; I will inquire. Q. All right. I asked you to have made up the record showing the amount of Trustees' certificates held by John D. Rockefeller, Wil- liam Rockefeller, Henry H. Rogers, H. M. Flagler, and Oliver H. Payne, Charles Pratt, or the estate of Charles Pratt, C. M. Pratt, Stephen V. Harkness, and John D. Archbold, at the time of the dis- solution of the Trust, March 21, 1892. Have you any such informa- tion ? — A. I have not. Q. The Trustees had stock-books, didnt they, showing the issue of all stock ? — A. I think they did. Trustees' books. 124 TILFOED. Q. Do you know what became of those stock-books ? — A. I do not. Q. Have you ever seen them ? — A. I dont think I ever did. I have no recollection of ever having seen them. Q. They would necessarily come into the hands of the Liquidating Trustees, wouldnt they? — A. Why, I suppose they would be apt to; I dont know whether they ever did or not. Q. Do you know of any way you could liquidate that Trust with- out you had the stock-books of the Trustees ? — A. I do not. Q. Now, as the attorney-in-fact of the Liquidating Trustees, did you ever see those stock-books? — A. I did not. I was not the 253 only attorney-in-fact, though, I am qviite sure. There were a number of them. Q. You have never seen them? — A. I have never seen them. I have seen a certificate book, but not any stock-books. Q. Well, the certificate books, then. — A. I have seen the certificate books from which the certificates were issued. Q. Where is that? — A. I dont know. Q. Has it been destroyed ? — A. I dont know ; I didnt have charge of it. Q. Who did have charge of it? — A. Why, I dont know, unless the secretary. He would be the natural custoclian. I would not be. Q. Well, your office signed all the certificates of stock issued by the Standard Oil Company of New Jersey in exchange for the stock in the subsidiary companies. You are having made up, are you, a statement of the holdings of these men at the time the stock was issued, in payment for their stock of the subsidiary companies?— A. Yes sir. Q. From what books is that being made up? — A. The New Jer- sey's, sir. Q. In your office? — A. Your question was if I was having made up a statement of the certificates of the New Jersey Company ? Q. Yes sir. — A. Yes sir ; that is, in the treasurer's office. Q. In the treasurer's office? — A. Either the treasurer's or 254 the controller, one or the other. No, I think it is in either the controller's or one of the assistant secretaries,. Q. I show you a list of the shareholders of the Standard Oil Com- pany of New Jersey under date of August 19, 1907. You need not examine the whole thing, but tell me whether that is made up in your office by your assistants. — A. What do you wish me to do ? Q. Is that made up from your office? — A. I think it is made up from the assistant secretary's office. Q. Assistant Secretary's office? — A. I think so. Q. Is it made from the transfer books ? — A. I dont know. Q. I thought you said yesterday that Mr. William G. Rockefeller had charge of the list of stockholders of the Standard Oil Com- pany. — A. No, you misunderstood me. Q. He signs all certificates? — A. He signs some, but doesnt sign all, no. TrLPOBD. 125 Q. Well, who does sign them? — A. Mr. C. M. Pratt signs some; Mr. Barstow signs some, and I sign some. Q. Mr. Pratt is the secretary? — A. He is the assistant treasurer, too. Q. He is also the assistant treasurer? — A. Yes. Q. They are signed either by the treasurer or one of the assistant treasurers ? — A. Or one of the assistant treasurers, yes sir. Mr. MiLBTJEN. It is a correct list; you can take that if you want to use it. Witness. I think the assistant secretary prepared this, Mr. Kel- logg. 255 Q. I want to ask you about some names there so as to identif j^ them with men who appear to have been stockholders in the Trust or certificate holders in the Trust. Mr. iliLBUEN. I am perfectly willing to have that marked in as being furnished. Mr. Kellogg. I dont know as it is necessary to put it all in. Mr. MiLBUEN. I think that is the best way, if you are going to use it at all, to mark it, and then you can read from it whatever you please. Mr. Kellogg. I dont think it is necessary to put them all in. I wanted to save putting that whole thing in the record if I could. Mr. MiLBUEN. It will be in. It may as well go in one time as another. Q. Will you look at the holdings of Mr. J. D. Archbold in that list, in the Standard Oil Company of New Jersey at present. — A. I have it. Q. How much is it? — A. 6,000 shares. Q. Who is Mr. John F. Archbold?— A. Mr. J. D. Archbold's son. Q. How many shares? — A. 100. Q. Mr. John D. Archbold was a signer of the trust agreement, was he not ? — A. You mean the original one ? Q. Yes. — A. I dont know ; I never saw the original agreement. Q. Mr. F. Q. Barstow? — I dont find that name here, Mr. 266 Kellogg. Q. Mr. F. Q. Barstow?— A. No. Q. They are in alphabetical order. Mr. Gka\'es. There you are. (Pointing.) A. Yes, I have it now. Q. How many shares ? — A. 350. Q. Who is Mr. J. P. Barstow ?— A. I dont know. Q. You dont know him ? — A. No. Q. ^Vho is Mr. E. G. Bayne? — A. President of the Seaboard Na- tional Bank. Q. Who is S. G. Bayne & Company?— A. I do not know. Q. Give the holdings of the two, will you?— A. S. G. Bayne, 110 shares. Q. S. G. Bayne & Co.— A. 300 shares. 126 TILFOED. Q. Now, I want to ask you again if you recollect or know of any connection between Mr. Bayne and the Security Oil Company. — A. I have heard he was president of the company; I dont know it. Q. You have heard he was president of the company ? — A. Yes sir. Q. Now, at that point, let me ask you to come back to the Man- hattan. Referring to the Manhattan matter and the Security Oil Company, did you ever hear of the General Industrial Development Company, Limited, of London, England? — A. Not that I know of. Q. What? — A. Not that I know of; I have no recollection 257 of ever having heard of it. Q. Never heard of it? — A. Not that I know of. Q. Did you ever hear of Budd, Johnson & Jenks, Solicitors? — A. No sir. Q. Or H. Maxwell Johnson, 27 Chancery Lane, London? — A. No sir. Q. Or the London Commercial, Trading & Investment Com- pany? — A. No sir. Q. Do you know Mr. J. H. Cuthbert?— A. M^io is J. H.? Q. Well, that is what I want to know ? — A. I do not. Q. Did you ever hear of him? — A. I knew a man named Cuthbert who is dead. I didnt know whether you were talking about him or not. Q. He was working for the Standard Oil ? — A. I think he did, but I am not sure ; not for some years, anyway. Q. How many years ago ? — A. Oh, I cant tell you. Q. Now, who is this man Cuthbert that you knew? — A. I dont know ; I knew a man by that name, I say. He is not living. I dont know. Q. Where did he live ? — A. I dont know ; I knew him here in New York. Q. You knew him in the office somewhere of the Standard Oil Company ? — A. I dont think so. Q. What was his business? — A. I dont know. Q. You understood that Mr. Bayne was the president or a 268 stockholder of the Security Oil Company? — A. I have heard that he was president of it, yes sir. Q. You never had any business with him as such? — A. No sir. Q. Do you know that the Standard Oil Company did? — A. I do not. Q. Will you turn to the name of Bostwick on that list.— A. Which one? There are several here. Q. What?— A. There are several Bostwicks here; which one? Q. Well, you knew Mr. J. A. Bostwick, did you?— A. I did. Q. And he was one of the Standard Oil men?— A. He was one of the Trustees. Q. Of the Standard Oil Trust?— A. Of the Standard Oil Trust. Q. And one of the Liquidating Trustees ? — A. No sir. Q. He was a stockholder of the Standard Oil Trust ? — A. I think he was. TILFOBD. 127 Mr. MiLBUKK. What is a stockholder,— a certificate holder? Q. A certificate holder, then. — A. A certificate holder, yes. Q. And interested during the period of liquidation? — A. I dont know; Mr. Bostwick has been dead some years, and I dont know whether he was alive then or not. Q. Do you know whether his estate was the owner of a large amount of the stock of the Standard Oil Company of New Jersey? — A. Yes, it was. 259 Q. Are the owners of the stock under the name of Bostwick there, — is that the same stock that was owned by Mr. J. A. Bostwick during his life? — A. I have no doubt some of it is; I dont know whether it all is or not. Q. Eead off the list, and tell us what you know about each one. — A. Mr. A. F. Bostwick, Mrs. Helen Q. Mrs. Helen C. Bostwick, who is she? — A. The widow of J. A. Bostwick. Q. How many shares^ — A. (),048. Albert C. Bostwick is a son. Q. Of J. A. Bostwick?— A. Of J. A. Bostwick; 100 shares. Q. Now, there seem to be various amounts of this stock in trust A. Yes. Q. For A. F. Bostwick, Helen C. Bostwick, and Albert C. Bost- wick, and Helen C. Bostwick and others. Do you know anything about those? — A. I do not. I know who Mrs. Helen C. Bostwick is and who Mr. Albert C. Bostwick is. I dont know the others. Q. Do you know A. F. Bostwick? — A. I dont remember of ever having met him. Mr. MiLBUEN. A. F. isnt Alfred Bostwick. There is an A. F. and Alfred C. Witness. Alfred C. is different from A. F. I am not sure who A. F. is. Mr. MiLBURN. Who is it that you know ? Witness. Albert that I know. 260 Q. Do you know who Emma B. Bostwick is? — A. No sir. Q. Or Amelia B. Bostwick?— A. No. Q. Abel A. Bostwick?— A. No sir. Q. And again there appears A. F. Bostwick. — A. I dont know who they are. Q. Will you turn to Mr. Brewster or to the Brewsters. — A. I find Mrs. Charles M. Brewster, 7 shares. Q. Wait a moment. Who was Benjamin Brewster?— A. He was one of the Trustees of the Standard Oil Trust. Q. And a certificate holder? — A. He was. Q. A very large one ? — A. I think he was a fairly large one, but I am not prepared to state certainly. Q. Who is Elmina D. Brewster that appears in the present list of stockholders? — A. I dont know. Q. You dont know ? — A. No sir. Q. Or Frederick F. Brewster i—A. I dont know him, either. Q. Charles M. Brewster?- A. No. 128 TILFORD. Q. George S. Brewster? — A. I know him. Mr. MiLBUEN. Is he a son? Witness. He is a son of Benjamin Brewster. Q. Benjamin B. Brewster. — A. I know him. Q. Mary E. Brewster? — A. I dont know her. Q. Eobert S. Brewster ? — A. I dont know him. Q. Benjamin Brewster is dead, is he? — A. Yes sir. Q. About when did he die? — A. 1 could not tell you; some years ago. 261 ilr. MiLBUKx. You know he left, I suppose, Mr. Tilford, some children I Witness. Oh, yes, I know that. Mr. MiLBUKN. And you know one of them only ? Witness. I know one of them. Mr. MiLBUBN. Personally? Witness. Yes, I know George. Q. That is George S. Brewster? — A. (n'ori^'e S. Brewster, yes. Mr. iliLBrr.N. Did he leave a widow I Witness. Yes. Mr. MiLBUEN. But you dont know what her name is ? Witness. I do not. Mr. MiLBUEN. Is she down there as Mrs. Charles ? Witness. That would be 7 shares. I imagine that is not the widow. There is another, Mrs. Elmina D. Brewster. Mr. MiLBUEN. You dont know whether her name is Elmina or not? Witness. I do not; I never knew her. Q. C. M. Everst ? 800 shares.— A. Well, I Imow him. Q. Who is he? — A. He is president of the Vacuum Oil Company. Q. How many years has he been? — A. He may be vice-president. He is either president or vice-president, I dont remember; he is one or the other. Q. H. M. Flagler, 30,500 shares. Mr. MiLBUEN. 30,500 shares. Q. He was a large stocldiokler or certificate holder in the 262 Trust?— A. Yes, sir. Q. The Standard' Oil Trust. Wlio is Mrs. Annie L. Flag- ler — his wife? Do j'ou know? — A. I dont know. Q. You dont know ? — A. No. Q. Do you know any of the other Flaglers there? — A. I know Harry Harkness Flagler. Q. The son?— A. Son of H. M. Flagler. Q. 900 shares?— A. Yes. Q. Do you laiow John H. Flagler ? — A. Yes, I know him. Q. Is he a son? — A. No. I don't know whether he is any rela- tion or not. Q. Mary Lillie Flagler, account of H. M. Flagler ? Mr. MiLBUEN. Care of. Mr. Kellogg. Oh, care of, is it? Witness. I dont know her. TIliPOED. 129 Q. 1000 shares. Turn to Charles W. Harkness.— A. I have it. Q. Did you know Mr. D. M. Harkness ?— A. No sir. Q. Did you know him by reputation ?— A. D M « Q. D. M. Harkness.— A. No. Q. Do you know Mr. Stephen V. Harkness ?— A. No sir. Q. Or S. V. Harkness, as it is signed to the trust agreement?— A. I did not. Q. Did you know of the firm of Rockefeller & Harkness?— A. No, I may have read about such a firm, but I didnt know it. 263 Q. Do you know whether he was ever interested in the oil business? — A. AVho? Q. Mr. Harkness. — A. Wliich one? Q. S. V. Harkness. — A. No, I do not. Q. Do you know who Mr. Charles W. Harkness is?— A. Yes sir. Q. Who is he?— A. A director of the Standard Oil Company of New Jersey. Q. How many years has he been connected with it? — A. I dont remember ; I can get the date of his election if you wish it. Q. A number of years ?— A. I can get the date, I say, if you wish it. A number of years, yes ; he has been a director for a number of years. Q. Do you know Mr. E. D. Harkness ? — A. No sir. Q. Mrs. Edith Hale Harkness?— A. No. Q. Edwin S. Harkness?— A. No. Q. Lamon V. Harkness? — A. No. Q. William L. Harkness ? — A. No. Q. You dont know them? — A. No. Q. Mr. H. A. Hutchins?— A. Yes, I know him. Q. He was a signer to the trust agreement? — A. I dont know. Q. Did you know him in 1882? — A. Did I know Mr. Hutchins then? Q. Yes.— A. Yes. Q. Was he engaged in the oil business? — A. Yes. 264 Q. Connected with the Standard Oil Compan;/? — A. Yes. Q. With the Standard Oil Trustees?— A. No, the Standard Oil Company of Ohio. Q. Well, he was a stockholder of the Standard Oil of Ohio? — A. Well, that I dont know. Q. Was he a certificate holder? — A. He was. Q. Of the Trustees ? — A. I am quite sure he was. Q. Did you know Mr. O. B. Jennings? — A. O. B., yes. Q. In 1882? — A. No, I dont think I knew him until afterwards. Q. His name appears as signed to the trust agreement? — ^A. I didnt laiow him until some years after that, I think. Q. What was his business? — A. I dont know what his business was. I think he at some time became one of the trustees, or one of the Liquidating Trustees. Q. Of the Standard Oil Trust?— A. Yes. 32555—08 9 130 THiFOED. Q. Connected with the Standard Oil Companies, some of them? — A. No, I think his only connection was with the Trust. Q. He was a certificate holder in the Trust? — A. I presume he was, although I dont remember. Q. You understood him to be? — A. Yes. Q. You attended meetings with him? — A. I dont remember that. Q. Do you know any of the Jennings whose names appear in this stock list? — A. Let me look at it. I think I do. I will look in a minute. I know Walter Jennings. 265 Q. Is he a son of O. B. Jennings? — A. Yes. Q. Do you know any of the others? — A. I have met Oliver G. Jenniiig- also. He is a son. Q. Did you know Mr. Charles Lockhart? — A. Yes, I have met him. Q. '\'\Tiat was his business? — A. He was in the oil business; he was connected with the Standard Oil Company. Q. Connected with the Standard Oil Company? — A. Yes, or some of its interests. Q. Or some of its interests? — A. Yes. Q. In 1882 ? — A. I think so, but I dont remember. Q. He was a signer, it appears, of the Trust agreement. Was he a member of the firm of Lockhart & Frew ? — A. I dont know. Q. He was connected with that companj' in 1882, was he, — with some of the Standard interests ? — A. I couldnt say as to the time, but I know he was connected with some of the Standard interests at some time. Q. Wlio is James Henry Lockhart, care of Charles Lockhart, 4,250 shares? — A. I dont know him. Q. Who is John Marshall Lockhart? — A. I dont know. Q. You dont know? — A. No. Q. Mr. William H. Macy? The estate of Josiah Macy seem to have been signers to the Trust agreement in 1882. Mr. MiLBUEN. The estate was? Mr. Kellogg. Yes, and William H. Macy, Jr. Q. Were any of those Macys connected with the Standard 266 Oil Company? — A. I do not know. I had only met, when I was quite young, Mr. Josiah Macy, who is prolDably the man you mention there, or one of the family, but I dont Iniow what his re- lations were to the company at all. Q. The estate of Josiah Macy, Jr., has 4,900 shares. That estate seems to have been a signer to the Trust agreement. — A. Well, I dont know about that. Q. Do you know William H. Macy ?— A. No. Q. You dont know what their connection was with the Standard Oil business? — A. I do not. Q. And never did know ? — A. I never did know, no. Q. You knew Daniel O'Day in his life time, did you not? — A. Yes sir. Q. What was his business? — A. He was connected with the pipe line department. TILFOKD. 131 Q. With the pipe line company?— A. With the National Transit <^ompany. Q. And previous to that with the United Pipe Lines?— A. I have heard so, but that was before I had much knowledge Q. And previous to that with the American Transfer Company?— A. I dont know about that. Q. Well, for many years he was connected with some of the Stand- ard Oil interests, was he not?— A. Yes sir. 267 Q. How many years have you known him?— A. Well, I would not be able to tell you exactly, but I probably have known him for twenty years or more. Q. Was Mr. Daniel O'Day a certificate holder in the Trust?— A. Yes. Q. He was ?— A. That is my recollection. Q. And remained so all during the Trust period and the Liquida- tion period? — A. I think so. Q. And became a stockholder in the Standard Oil Company ?— A. Yes. Q. Is the name on the list the estate of Daniel O'Day, 2,655 shares, his estate? Mr. MiLBURN. The estate of Daniel O'Day ? Mr. ElELnoGG. Yes. Witness. I presume it is. Q. Col. Oliver H. Payne, he seems to have signed the Trust agree- ment; was he a trustee of the Standard Oil trust? — A. I dont know, Mr. Kellogg, whether he was ever one of the trustees or not. Q. O. H. Payne, that is the same Payne, is it? — A. O. H. is the name. Q. Formerly lived in Cleveland? — A. Yes. Q. Was he connected with the Standard Oil business ? — A. He was with the Standard Oil Company of Ohio. 268 Q. 40,000 shares. Will you look and see if that is correct? Mr. MiLBUEN. That is correct. It is given down here. A. Do you want me to look? Q. Yes, if you please. — A. 40,000 shares for Oliver H. Payne. Q. Was he one of the Liquidating Trustees also? — A. I dont re- member that. Of course I can find out. He has taken no active part in the business in any way for many years, and therefore I dont re- member just what he did. Q. I notice that Mr. Charles Pratt signed the trust agreement. Did you know Mr. Charles Pratt? — A. Yes sir. Q. What was his business ? — A. He was connected with the Stand- ard Oil Company. He was in business for himself at one time, I think. But he was connected with the Standard Oil Company when I knew him. Q. His concern was Charles Pratt & Company, wasnt it ? — A. Yes. Q. Owned large refineries where? — A. Over on Long Island. 132 TILFOBD. Q. Previous to the formation of the trust that concern was known as Charles Pratt & Company, wasnt it? — A. I think so, although it is a pretty long time ago. Q. That was the same Charles Pratt ^ — A. The same Charles Pratt, yes. 269 Q. And Henry H. Rogers was a member of that firm? — A. I so understood. Q. They were all signers to the Trust agreement, it appears. — A. Well, I dont know about that. Q. Now, in the list of stocks is the estate of Charles Pratt, 52,802 shares ; is that the same Charles Pratt who was of the Charles Pratt & Company? — A. I think so. Q. Either Mr. Pratt or his estate were stockholders A. Yes sir. Q. During the trusteeship? — A. Yes sir. Q. And the liquidation period? — A. Yes. Q. And until the present time? — A. Well, I think perhaps his stock was immediately converted. Q. Well, I mean A. I mean the shares of the company, at once. Q. He represented substantially the same interest in the trust and the subsidiary companies during the liquidation and in the Standard Oil Company of New Jersey ever since 1882? — A. Well, it may be substantially so ; he has had a large interest. Q. A very large interest? — A. Yes sir. 270 Q. And Mr. Charles M. Pratt, 5,000 shares, was the Mr. Pratt who testified in this case? — A. Yes sir. Q. A son of Charles Pratt? — A. Yes sir. Q. So I understood him. Mr. John D. Rockefeller, Mrs. A. A. Rockefeller, and Mr. John D. Rockefeller, Jr. ; turn to those, will you? Mr. ]\IiLBURN. It is a familiar name. Mr. Kellogg. Rather. A. John D. Rockefeller, I have it. Mrs. A. A. Rockefeller. Q. John D. Rockefeller, 247,692 shares. — A. That is correct. Q. T^Tio is Mrs. A. A. Rockefeller? — A. I dont know, unless that name suggests Mr. John D. Jr.'s wife. Q. John D. Jr. is a son of Mr. Rockefeller ? — A. Yes. Q. You knew Mr. John D. Rockefeller a good many years, didnt you? — A. Yes sir. Q. He was first with the Standard Oil Company of Ohio, wasnt he?— A. Yes. Q. Did you know the partnership of Rockefeller & An- 271 drews ? — A. No, I never met Mr. Andrews. I know Mr. Flag- ler, but I think it was after that partnership that I knew them. Q. And there was a partnership of Rockefeller & Flagler, was there not? — A. I dont know. I dont think I knew any of them until long after these partnerships. TIIiFOBD. 133 Q. You did not?— A. No sir. At least not that I have any knowl- edge of. Q. Mr. William Rockefeller.— A. Yes, I know him. Q. He was also engaged with Mr. John D. Rockefeller in the oil business, in the Standard Oil Company of Ohio, was he not ?— A. I presume he was. I knew him here in New York. Q. 11,700 shares.— A. 11,700 shares. Q. Do you know of any other stock than that that he owns in the Standard Oil Company of New Jersey?— A. Who— William Rockefeller ? Q. Yes. — A. No. I onlj' know Avhat the list shows. Q. Only what the list shows ? — A. That is all. Q. Henry H. Rogers? — A. I know him. 272 Q. 16,020 shares?— A. 16,020. Q. Do you know anj^ of the other Rogers named in that list? — A. I know H. H. Rogers, Jr. Q. Is that his son? — A. That is his son. Q. 10,050 shares.— A. 10,050 shares. Q. Any other of the Rogers there that you know ? Mr. MiLBXJEN. Mrs. Cornelia. Witness. I dont know her. I dont know any of the others, unless one of them is jNIrs. H. H. Rogers, and I dont know what her first name is except that. Q. She has 225 shares. — A. Oh, Mrs. Henry H. Rogers, I know her. Yes, 225 shares. Q. You know none of the other Rogers? — A. I dont know any of the others. Mr. KJELLOGG. They are only small holdings. Q. Mr. TiLroED. You didnt sign the trust agreement? — A. No sir. Q. You became a stockholder afterwards in the trust? — A. In the trust, yes; I have no stock in the company. Q. You became a certificate holder in the Trust? — A. A certificate- holder, Ishould say ; that is right. Q. Do you remember the amount of certificates you held in 273 the trust? — A. When it was converted? Q. Yes. — A. No, I do not. Mr. MiLBURx. Wliat do you mean by that? What period is that when it was converted, — when it was dissolved ? Q. You mean at the time of the dissolution of the Trust?— A. Yee. I dont remember how many I had. Q. Can you find the amount ?— xV. I probably can ; if any old mem- orandum I had is still in existence, I can get it. Q. Did you have then substantially tlie same interest that you have now? — A. No, I had much less. Q. Much less ?— A. Yes. Q. You appear now to have 6,000 shares, is that correct ?— A. Yes sir, that is correct. Q. Do you know the other Tilfords named in that list?— A. I probably do. 134 TILFOKD. Q. Beg pardon ? — A. I will look them over. I know I know some of them. I have them now. Shall I read them off? Q. H. M. Tilford. — A. He is my brother. He is still connected with the Standard Oil ? — A. Yes sir. 274 Q. Was he during the period of the trusteeship? — A. I think so, yes; he must have been, yes. Q. Mrs. Catherine H. Tilford? — A. That is my mother. Q. And Fiorina J. Tilford ? — A. My sister-in-law. Q. Isabel W. Tilford?— A. That is my sister-in-law. Q. Will you turn to W. G. Warden, or Estate of W. G. Warden?— A. I have met him, Imew him slightly. Q. His name appears in the Trust agreement W. G. Warden? Warden, Frew & Co? — A. I think that is the same Warden, from hearsay, though. Q. Joseph L. Warden ? — A. I dont know who he was. Q. Warden, Frew & Co. were refiners at Philadelphia, were they not? — A. I dont know. I have no knowledge of that excejDt by hear- say, except I have heard there was such a concern. Q. Warden, Frew & Co stock seems to have been in the hands of the Trustees of the Standard Oil Trust. You have no recollection of it ? — A. No sir. Q. The Estate of W. G. Warden, is that the same Warden you knew? — A. Yes. Q. .5,858 shares? — A. Correct. Q. John B. Warden, who is he? — A. I dont knoAv him. Q. Are there any other Wardens there that you know? — A. No, I dont think I ever knew any but the one. 275 Q. Did you know W. T. Wardwell?— A. I do. Q. William T. Wardwell?— A. Yes, I know him. Q. His name appears in the Trust agreement; what was his busi- ness ? — A. He was at one time connected with the Standard Oil Com- pany of New York. I dont know that his Q. Of New York?— A. Yes. Q. What company was he connected with at the time the trust agreement was made? — A. I dont know. Q. You dont know? — A. No. Q. Is the W. T. Wardwell in the stock-list which you have the same Wardwell? — A. What do you mean by the same Wardwell there? Q. The same Wardwell who signed the agreement? — A. That I dont know. He was the same Wardwell that was connected with the Standard Oil Company of New York. Q. Is he an old man? — A. Yes. Q. Well, his name is William, is it? — A. William, yes. Q. It appears in the list W. T. Wardwell, 750 shares. — A. They have got him William in this list ; William T. Wardwell 750 shares. Q. Oh, I beg your pardon, I have made a mistake. Did you know Samuel Andrews? — A. I did not. Q. Did you know George H. Vilas? — A. Yes. TILFOBD. 135 Q. His name appears signed to the trust agreement. — What con- nection did he have with any of the oil companies ? A. He was an auditor, sort of had charge of accounts, and 276 he may have been secretary of some of them, but I dont remem- ber. It was many years ago since he has been connected. Q. Has not been connected for many years? — A. Not for many years. Q. Did you know J. J. Vandergrif t ?— A. I did ; I knew him. Q. His name appears in the trust agreement? What company was he connected with? — A. I dont know. I met him before he was con- nected with the Standard. Q. What? — A. I met him before he was connected with the Stan- dard Oil Company, and while he was connected with them some way afterwards, I dont know jvist what time. Q. You dont know what company? — A. I dont know. He has been dead a great many years. Q. I asked you to produce the names of the stockholders of the Standard Oil Company of New York voting at some meeting diiring the liquidation period, showing the number of shares voted and the names of the parties voting the stock and whether the stock held by the Trustees of the Standard Oil Trust during the liquidation voted the stock. Do Petitioner's Exhibits 19 and 20 show that fact? — =A. To the best of my knowledge and belief. Mr. Kellogg. Are those copies of the original ? Mr. MiLBTJRN. Shows what they did in voting stock; that is the way you put it. Mr. Kellogg. Yes. 277 Witness. I believe them to be true copies. May I look at that one again, Mr. Kellogg? Q. Yes sir. (Handing witness paper.) Mr. MiLBUKN. He has got the originals ; he is keeping them. Mr. KJELLOGG. I offer in evidence Petitioner's Exhibits 19 and 20. Q. According to that, there were 70,000 shares of stock of the Standard Oil Company of New York on January 7, 1896 ?— A. Yes sir. Q. And at that meeting, January 7, 1896, 35,599 shares were voted? — A. Correct. Q. Belonging to the individuals who had received assignment certificates and converted their stock into the stock of the Standard Oil Company of New York?— A. Correct. Q. And the stock still held by the Trustees on January 7, 1896, was 34,391 shares ?— A. That is according to the statement. Q. So that four years after the Trust was dissolved, the Trustees still held nearly one-half of the stock of the Standard Oil Company of New York?— A. It appears to be so from this. Q. And the Trustees of the Standard Oil Trust held nearly half of the stock of all the companies, didnt they, at that time?— A. I dont know ; they certainly did not hold a majority. A majority was con- 136 TILFOED. verted immediately. Of all the companies a majority was converted immediately. 278 Q. Who has the assignments of parts of the sub- companies? Was one assignment of a part in all of the companies? The Trustees would have in their hands, with the exception, perhaps, of the Standard Oil Company of Ohio, the same number of stock of each of the sub-companies, wouldnt they ? — A. I am not prepared to say off-hand that would figure out the same way, with the capital of each company being different. Q. Well, the same proportion, I mean, not the same number of shares. The same proportion? — A. Well, I dont know whether it would figure out. I am not able to answer that. Q. The shares of the sub-companies were divided into equal parts, with the same denominator, were they not? — A. They were. Q. Then if you made an adjustment of the shares of all the sub- companies by the same instrument, you would retain in your hands the same number of shares, would you not, in each company — I mean the same proportion in each company? Mr. MiLBUEN. Isnt that, after all, Mr. Kellogg, an argument? Mr. Kellogg. No. Mr. MiLBUEN. Or inference? You can draw the inference or he can draw the inference. Q. Well, will you answer the question, please. — A. Well, you put to me a mathematical problem. Q. Well, then, you can answer it, cant you ? — A. Well, I am afraid to answer it without knowing. 279 Q. Well, you do know that assignments of parts of the sub- companies were made to each certificate holder in one instru- ment? — A. Yes. Q. And that each certificate holder received the same proportion in each company; you know that, dont you? — I do. Q. Then you know if on January 7, 1896, the Trustees of the Standard Trust held 34,391 shares out of 70,000 shares of the Stand- ard Oil Company of New York, they held the same proportion in every other company, didnt they? — A. Well, it may have been so, but I dont like to say so. Q. Well, it would naturally be so, wouldnt it? Mr. MiLBUEN. Let us say, to pass on, the probabilities are that it was so, as a matter of inference. Witness. I thought it was even greater than this. I thought we had more stock issued than the percentage shown here. That was my recollection. Q. Now, if you have the records of the Standard Oil Company of New York so that you can tell the number of Trust certificates outstanding (I mean the number of shares of the Standard Oil Trust) of the Standard Oil of New York, in your hands, and at any given period (that is, in the hands of the trustees at any given pe- riod), you can get that information from all the companies, cant you ' — A. I dont know that I can. I am not connected with the other TIIiFORD. 137 companies. I am with New York, and the New York keeps its records very well in this way. Now, I dont know as the others do or not. 280 Q. If the records are kept as well as the Standard Oil Com- pany of New York, you can get it? — A. They might have some records, but they might not hiive it in this form. Q. If the other companies keep the records as elaborately as the Standard Oil Company of New York, you can get the information for all of them, cant you? — A. I could, if they would furnish it to me. Q. What I have been asked for here, and what I would like to get, is the figures showing the gradual process of that liquidation and the amount of stock in these sub-companies which was held by the Trustees of the Standard Oil Trust during all the years of that liquidation. Now, you must have some books that will show that fact, it seems to me. Do 3011 know whether you can find it out or not? — A. I dont know whether I can. I have no books of the Stand- ard Oil Trust, I can tell you that, for I have inquired to find out whether anybody had them that I knew of. Q. Have you inquired in the comptroller's office? — A. I have. Q. And in the secretary's office? — A. I have; I have asked if thej' had anything that would give me a list of individuals that you asked me. You asked me to furnish the number of Trust certificates held by certain individuals, and I have inquired if anybody had any records of that kind that I could make it up from. Q. Mr. Flagler was secretary of the Standard Oil Trustees, 281 wasnt he ? — A. He was, yes sir. Q. Have you inquired in his office? — A. I have not. Q. Will you do so?— A. I will. Q. All right. Perhaps you may find it there. I want the process of liquidation from year to year. "Where is Mr. Flagler's office ? — A. 26 Broadway. Q. Who is in charge of it when he isnt there ? — A. I am not sure. I will find that out for you, though. I would rather not answer now. Q. Now, Mr. Tilford, I call your attention to the date that the resolution of the dissolution of the Trust was passed, to-wit, on March 21, 1892. You remember that meeting, do you?— A. I do. Q. And it appears now that the stocks which were divided pursu- ant to that resolution were the twenty companies which have been identified? — A. Yes sir. Q. At that time, or within a few months before that dissolution, did not the Standard Oil Company of New Jersey own the stocks of a large number of other corporations ?— A. They may have owned some; I think they did, but I cant tell you from memory. Could not have been a very great number, because the capital didnt war- rant it. Q. Didnt warrant the ownership?— A. It owned a number, I am quite certain. 138 TILFORD. Q. Twentj' or thirty of them? — A. Well, that I couldnt say from memory. 282 Q. If yon saw the list, would it refresh your memory ? — A. It would not, because I dont know what it held before then. Mr. SIiLBrEN. ^Yho was this? Witness. The Standard Oil Trustees. Did I s;iy Standard Oil Company of New Jersey ? Mr. MiLBUEN. Yes, you said New Jersey. Q. I meant the Standard Oil Trustees. — A. Well, if you will read that question then, I will answer. I answered New Jersey. Q. I beg your pardon. Did not the Standard Oil Trustees, within two months or three months previous to that dissolution which took place on March 21, 1892, also own the stocks of a large number of other corporations ? — A. Besides these twenty ? Q. Yes. — A. I do not remember. Q. You have no recollection about it at all ? — A. I have not. Q. If you saw a list of them you think you would A. Not with- out verification. I didnt keep those accounts. Q. You were a Trustee at that time ? — A. I know, biit I was attend- ing to other things. The Trustees did little or nothing. Q. Well, they seemed to handle a large amount of securities? — A. They did, but I was attending to the business, and only meeting occasionally with the trustees to do something. I did not give any attention to it. Q. Well, cant j-ou tell whether they owned twenty companies or sixty companies? — A. I cannot, because I dont know on what you base your question. You see I havent studied this up as you have. I will try and find out anything you wish me to do. 283 Mr. MiLBUEN. You have, perhaps, not as vivid an imagina- tion as Mr. Kellogg has. Witness. We have talked so much about the twenty companies that I had almost begun to think that was everything. Q. Oh, no. — A. But I would be very glad to look up anything. Q. As a matter of fact, wouldnt you recollect it if the Standard Oil Trustees, instead of dividing all of their stocks up into parts and dissolving as this resolution provided, had just previous to this dis- solution turned over to the Standard Oil of New Jersey twenty or thirty companies, wouldnt you remember that? — A. Well, I dont know as I would, Mr. Kellogg. Q. You dont know as you would? — A. No, I dont Iniow what I was doing at that time. Q. Wasnt that a preliminary step leading to this dissolution, in- stead of dividing all of the stocks among all these certificate holders, that they turned over a large number to the Standard Oil of New Jersey? — A. I dont remember; I will get you, if you wish me, any list you wish. Mr. Kellogg. Well, I will have to pass that, because I havent got the list of corporations yet. As soon as we can get it, we will have Tn.,FOED. 18P from the books a list of these companies. I may have to ask Mr. Til- ford about some of those ; he is the only one of the liquidating trustees we have here. Q. You heard Mr. Pratfs testimony about the foreign trade or export trade committee ?— A. I heard what he said. 284 Q. Are you familiar with that committee ?— A. It is not a committee, Mr. Kellogg; it is a number of employes who attend to the export business. Q. Well, they are appointed A. Not as a committee, no; they are appointed to look after that business by the officers of the com- pany. Q. Appointed by the Standard Oil Company of New York?— A, Yes sir. Q. Now, the Standard Oil Company of New York is a large ex- porter, isnt it ? — A. Yes sir. Q. Does it export all of the oil manufactured by your other com- panies? — A. Most of it, but not all, I think. Q. What companies export directly ? — A. I think the Vacuum Oil Company does. Q. Does the Vacuum Oil Company export lubricating oil? — A. Lubricating oil. Q. Does the Standard Oil Company of New York export all the- oil except the lubricating oil ? — A. Most of it, I should say. I dont know positively whether it is all or not, but substantially all ; I wilt say that. Q. Substantially all? — A. Yes. Q. It buys the oil from the other companies ? — A. Yes. Q. Except that which it manufactures itself? — A. Yes. Q. And exports it all or substantially all? — A. Substantially all,, yes. Q. You know of no other company exporting anything but 285 lubricating oil, do you? — A. I do not; I dont recall any. Q. Now, what other companies besides those which the Standard Oil Company of New Jersey controls by stock ownership, does the Standard Oil Company of New York buy oil from and ex- port it? — A. You mean it buys some oil from some of the oil region refineries ? Q. Yes sir. — A. Yes sir. Q. What companies? — A. I could not name them, but there are a number of them. Q. What companies did you say? I didnt understand you. — A. I said in the western part of Pennsylvania we buy oil from some of those refineries classed as competitive. Q. Well, it has a contract, or some one of the companies has a con- tract with a large number of independent producers who are con- nected with the pipe lines of tlie Standard Oil Company, to purchase all their export oil, hasnt it ? — A. No contract, no sir. 140 TILFORD. Q. Isnt there an agreement which is attached to the bill of com- plaint and admitted to be an agreement for that purpose? — A. It is an understanding; it was never a contract. Q. Well, it is a memorandum, isnt it? — A. Memorandum, yes. Q. In writing? — A. Well, it is ni writing in the sense that a memorandum was made of it, yes. It never was executed. Q. I show you Exhibit 15 attached to the bill of complaint.— •2SG A. I have no doubt that is substantially correct. I cant remem- ber all of it. Q. You say that was never executed, but you have opei'ated under it, havent you ? — A. We have. Q. And it is still in existence, isnt it? — A. No. Q. When Avas it abrogated? — A. I dont remember when; some little time ago. Q. Well, how long ago? — A. I cant tell you. Q. 1905, 1906 or 1507 ?— A. It was either 1906 or 1907, I think. Q. 1906 or 1907?— A. Yes. Q. Did you have anything to do with negotiating that contract?^ A. I did ; that understanding I want to say, Mr. Kellogg. Q. That understanding? — A. Yes, sir. Q. All right, we will call it an understanding. — A. All right. Q. Would you know the list of refineries if I should read them to you? — A. I would remember some of them. Q. Pittsburg Oil Refining Company? — A. Yes, I think that is one. Q. Will you turn to page 96 of the bill of complaint there, and there is a list before you. Before asking you the list, I wish to ask you some other questions. About when was that understanding negotiated? — A. The latter part of 1903, I think. Q. The latter part of 1903 ?— A. Yes sir. Q. These refineries are situated upon the pipe lines of some 287 of the Standard's companies? — A. They aie connected with them, I believe. Q. And procure their crude oil supply from the Standard's pipe lines ? — A. Yes, sir, most of their supplies. I dont think they obtain all of them. Q. Under that agreement, you agreed to furnish to each one of the refineries there named a certain number of barrels per day, did you not? — A. No, we agreed to sell a maximum quantity of oil which they could divide among themselves as they saw fit. Q. The maximum quantity was 150,000 barrels per day? — A. I dont remember the exact (juantity; that is substantially it. Q. And it was divided between these companies? — A. They di- vided among themselves. Q. It was divided substantially according to that list? — A. That I could not answer. Q. Is that list on page 9C. a correct list of those refineries? — A. ,\s far as I remember. TILiFORD. 141 Q. Are not those refineries solely dependent upon the Standard's pipe lines for their crude oil ? — A. I dont think all of them are. Q. Did you not, just previous to the execution of that contract, cut down the amount they were receiving^ — A. A short time before we did cut down the amount we were selling to them; that is, for the time being only. 288 Q. Well, just shortly before the execution of that contract you cut down the amount you were selling to them? — A. We did. Q. Then tliey executed this contract whereby they gave you the exclusive right to purchase the export oil? — A. They made that agreement at the same time. Q. They made that agreement? — A. At the same time. Q. That was a consideration for it, wasnt it? — A. We made them at the same time. It had no hearing on the case. Q. At the time you made the arrangement to let them have 150,000 barrels per month, they made the agreement with you to give you all the export oil for sale, didnt they? — A. All that they wished to sell. Q. All that they wished to sell? — A. Yes sir. Q. Well, they wished to sell and have sold a good deal, have they not? — A. Not very much, no sir. Q. Well, whatever they sold, they sold to you? — A. I dont know about that. Q. That was the agreement? — A. That was the imderstanding. Whether it was carried out or not, I dont know. Q. You found one of the companies had been selling to some other company and you objected? — A. I did not. I dont know whether anybody else did or not. Q. Didnt vou write a letter to them objecting? — A. I dont think I did. Q. Didnt you have somebody else write a letter to them 289 objecting? — A. I dont remember anything of that sort; I dont know. It may have been written. Q. Do you know Mr. William E. Wall , the president of that Petroleum A-^sociation including those refineries? — A. I do. Q. He lives in Cleveland ?— A. Yes sir. Q. Did you know whether any objection was made, or know of any objection that was made to one of these refining companies selling to the Union Petroleum Company?— A. It may have been; I dont re- member anything about it. Q. Do you remember of an objection being made to A. B. Miller & Son.', parties to tliat contract, selling some to the Union Petroleum Company?— A. I dont remember it, no. I dont know whether any was made or not. Q. Did you know of Mr. Wall writing a letter to A. B. Miller & Sons in which he said that the Standard Oil Company would not per- mit any further shipments to the Union Petroleum company?— A. I dont know ; I dont remember anything about it. 142 TILFOBD. Q. Who did handle those negotiations ? — ^A. I handled the original ones. Q. Who made these objections, if any were made? — A. WTiy, pos- sibly Mr. Barstow, but I dont know about that. Q. F. Q. Barstow ? — A. Possibly, but I dont know. Mr. MiLBUEN. F. Q. — is that the one I know. Witness. That is the one you know, yes. Q. Mr. Barstow is away just now? — A. Yes; or somebody in his office, I dont know. 290 Q. "V\'hat is that? — A. Or somebody in his office. Q. Will you produce the correspondence between Mr. F. Q. Barstow, or somebody on his behalf, or C. N. Payne or somebody in his behalf, with Mr. Wall relating to the execution and the carrying out of that agreement, and especially relating to the objections made by the Standard Oil Company (if any such were made) to their sell- ing any export oil to any other company? — A. I will look it up and see if I can find anything. Q. That contract you say was abrogated in 1906 or 1907? — A. I think so. Q. Was it about the time of the investigation of the Bureau or Corporations ? — A. I will have to get you the date, I will try to find when they told them. Q. I beg your pardon? — A. I will try to find what time it was done. I cant tell you what the reasons were. Q. Do you purchase their export oil now? — A. Sometimes; not much. They have not sold us much for a long time. Q. This export oil was to be sold to you at the official export quota- tion for bulk oil in New York, wasn't it? — A. Yes sir. Q. And who publishes those official quotations? — A. The Produce Exchange I believe has them. Q. Doesnt the Standard Oil Company publish it in New York? — A. Well, it dont publish them. It gives the quotations out to the broker. 291 Q. In fact, you make the quotations yourself, — the Standard Oil Company? — A. For our own oil, yes. Q. And those are the official quotations, are they not? — A. Prob- ably correspond with them ; I cant tell you. Q. They are first made by the Standard Oil Company of New York, and given out to the brokers, are they not? — A. Yes sir. Q. And they are the quotations that are made from day to day of export oil, are they not? — A. I think so. Q. Now, do you buy oil for export (the Standard) from any other company ? — A. We buy from the Tide Water. Q. You buy all that the Tide Water exports to Europe, do you not? — A. I dont know about all. Q. Substantially all, dont you? — A. I dont know about that; I presume we do, but I dont know. THiFOBD. 143 Q. You dont know of their exporting any oil to Europe, do you ? — A. I do not. Q. Do they export any oil themselves except to South America? — A. I dont know anything about their business. Q. Well, you buy their export oil, do you ? — A. A great deal of it anyway. Q. You buy their crude oil in West Virginia and the mid-continent fields and Kansas ? — A. I am not familiar with that situation. Q. You are not familiar with that? — A. No. Q. Well, what other companies do you buy the export oil of? — A. I cant remember, Mr. Kellogg. 292 Q. Have you an}- Avay of finding out? — A. If you will tell me just what you want to find out, I will do it if I can. Q. This export committee would know all about it, wouldnt they? — A. They probably would. Mr. MiLBUEN. One says it is a committee and the other says it is not. It doesnt make much odds what we call it. Q. Well, this list of gentlemen Mr. MiUBUEN. Well, after that, let us adjourn. Witness. Mr. Kellogg, I wish to say in answer to one of your questions about that crude oil, that that reduction was made prior to my negotiations with the refiners and before any question of refined oil was suggested or thought of. Q. Well, it reduced them away below their capacity, didnt it ? — ^A. Not for the year. It was the biggest year they ever had in their pur- chases from us in their history, before or since. Q. You have no recollection of any other company that it pur- chased from for export? — A. I have not. Q. What?— A. I have not. Mr. MiLBURN. Do you mean apart from the Standard? Mr. Kellogg. Yes, apart from these that he has mentioned. Q. Do you know of any other company in the United States, ex- cept the Pure Oil Company, that exports any oil to Europe— refined oil? — A. I cant think of any just now. Q. Then the Standard Oil Company of New York and the Pure Oil Company export substantially all the oil exported to 293 Europe? — A. No, I think now the Gulf Eefining Company probablv exports some. Q. The Gulf Refining Company?— A. Yes. Q. What is the Gulf Refining Company?— A. A refining company In Texas. Q. Who is connected with it?— A. I understand that Mr. Mellen of Pittsburg is the chief man. Q. How long ago did they commence business?— A. Oh, some years ago, I believe. Q. You dont know whether they export oil much or not?— A. I dont know how much, no, sir. (A recess was here taken until 2 o'clock P. M.) 144 TILFOED. 294 AFTERNOON SESSION. Wesley H. Tileord, recalled as a witness on behalf of Petitioner, testified as follows: Direct examination (resumed) by Mr. Kellogg: Q. Mr. Tilford, can you tell me why this agreement with the inde- pendent refineries for the purchase of their oil for export, about which you were testifying this morning, was never signed ? — A. Be- cause it was only a memorandum. Q. What? — A. Because it was not a contract; it was just a mem- orandum of what we verbally agreed to do there. Q. "Why was it written out in detail? — A. So there might be no misunderstanding. Q. Then, in effect, it was the agreement between you? — A. It was the understanding under which we were to proceed to handle the oil. Q. Now, it reads ; " All of the refined oil of any grade which "A" desires to export " — then follows a description of it — " is to be sold to S, delivered at Constable Hook, New Jersey, or to Philadelphia, Pennsylvania, at S's option ,on the following basis." 'A" represents the refineries, does it? — A. Yes. Q. Why were they called 'A' in their agreement ? — A. I dont know. Probably just as a memorandum of what we were talking about. 295 Q. Why was the Standard Oil Company called 'S'?— A. I suppose to indicate Standard Oil Company. Q. Was the agreement made in that form in order to conceal its nature? — A. No, sir. It was impossible to conceal it. Q. What? — A. It was impossible to conceal an arrangement with all these people. Q. Have you names of the committee or a list of the gentlemen who are in charge of the domestic trade? — A. I have not. I know a num- ber of them, though. Q. What ? — A. I know a number of them who have charge of the domestic trade business. Q. Isnt there a domestic trade committee ? — A. There is not. Q. Well, there is a department called the domestic trade, isnt there? — A. There is. Q. At 26 Broadway? — A. 26 Broadway, yes sir. Q. That department has charge A. That is a department of some companies — of some companies, not all, at 26 Broadway. Q. It is a department having charge of the marketing of all oil sold in the United States, with the exception of lubricating oil, isnt it ? — A. Not exactly as you put it. There are individuals and officers of various companies in the United States Q. I beg your pardon. — A. There are officers and agents of various companies in the United States, but no one has control of the business of the other. 296 Q. Do you remember Mr. Archbold's testimony in the Mis- souri case? — A. I do not. TILFOED. 145 Q. Did you hear him testify that there was a committee called the Domestic Trades Committee? — A. I did not; I did not hear his testimony. Q. You did not I — A. I did not hear his testimony. I read some of that testimony where I understood him to say there had been a name of that kind applied, but it was not really a committee. That is my recollection of it. Mr. Kellogg. AVell, I will look it over ; perhaps that is what it was. Witness. That is my recollection of what I read ; I never heard the testimony. Q. Well, are you as familiar with that as he is ? — A. I think I am. Q. Then you can state just as well as he can? — A. At the same time I dont know. Q. Who are the gentlemen composing that committee, if it is a committee ? — A. Well, I say I dont consider it a committee. The men who have charge of the ditferent sections of the domestic trade busi- ness I will name as far as I can remember. Q. ,A11 right, sir.— A. W. E. King. Q. What section of the country does he have charge of ? — A. He is the agent of the Standard Oil Company of New York, one of 297 the employes. W. G. Westcott, he is vice president of the Standard Oil Company of Kentucky. H. M. Tilford, he is the president of the Continental Oil Company and the Standard Oil Company of California. L. J. Drake, I think he is the agent of the Standard Oil Company of Indiana and possibly of some other com- pany, but I dont remember what the other one is. And Cutler — I dont remember his initials and I dont remember just which company employs him. I do not recall any others. Q. You do- not recall any others ? — A. Xo. Q. Well, are there others ? — A. I dont think so, but I would not be positive. I do not think there are. Q. Those men, then, have charge of all the marketing in the United States? — A. They have charge each of his own department. Q. Well, together A. No, I dont think so. Q. Do they have meetings ? — A. They may meet together occasion- ally. I dont think they have any regular meetings at all. Q. Do they have an office? — A. Each one has an office. Q. In the Standard Oil Company building? — A. Yes sir. Q. 26 Broadway? — A. Yes sir. Q. Well, now, Mr. Tilford, name the companies that directly mar- ket oil in the United States, exclusive, I mean, of crude oil and lubri- cating oil; I mean illuminating oils, in the United States. — A. The Standard Oil Company of California. 298 Q. Now, take the Standard Oil Company of California. — A. Yes sir. Q. It was formerly the Pacific Coast Oil Company, wasnt it? — A. It was. 32555—08 10 146 TILFOKD. Q. Its name was changed last winter to Standard Oil Company of California? — A. Yes. Q. How many years has the Standard Oil Company of New Jer- sey owned the stock of that company? — A. I dont recall. Q. Would H. M. Tilford know ?— A. He would, I think. Q. Previous to the acquisition of that stock by the Standard Oil Company of New Jersey, that company was doing business in Cali- fornia, wasnt it ? — A. It was doing a producing business in California and a little refining. Q. And refining? — A. A small refinery. Q. It was the largest refinery in California, wasnt it? — A. I dont know. It was not very large, I know that. Q. Who would be familiar with that? — A. I dont know whether H. M. Tilford would know or not. Mr. D. G. Scofield, the vice- president of the company there now, would know. Q. But he lives in California? — A. He lives in California. Mr. MiLBUEN. Dont you know ? Witness. No sir. You mean know what? Know when the stock was acquired? Mr. MiLBUEN". What it was when the Standard acquired its in- terest. Wctness. Well, I have stated it was a producing company and had a small refinery. 299 Q. At Kichmond, California ?— A. No sir. Q. Where was it? — A. At Alameda. Q. That is near San Francisco ? — A. Yes, near San Francisco. Q. Where it has a refinery now? — A. No, that refinery is out of existence. Q. It now has a refinery at Richmond, near San Francisco? — A. Yes sir. Q. You dont remember, you say, when it was acquired? — A. I do not. Q. Previous to the acquisition of the Pacific Coast Oil Company by the Standard Oil Company, it was doing business entirely separate from the Standard, wasnt it? — A. It was. Q. And a competitor of the Standard ? — A. If it can be called so, considering the very poor quality of the oil it manufactured. It was a much lower grade than we were selling. Q. To the extent of its ability it was competing, I suppose? — A. The oil was of so low grade that they made that it went to an almost different class of customers. Q. Well, you acquired it? — A. We acquired it. Mr. MiLBURN. When? Witness. I can find out for you, if you will make a memorandum for me. Q. Four or five years ago? — A. Oh, yes. I should say more than that. If you want me to make a guess, I would say seven or 300 eight. I am willing to say, Mr. Kellogg, that I think it is not more than eight and not less than five. TILFOKD. 147 Q. I think perhaps it is in the bill. Here it is. It was acquired about 1900, wasnt it?— A. I should say somewhere near 1900; it must have been back in 1903. Q. Now, prior to the acquisition of the Pacific Coast Oil Com- pany, through what companies did the Standard sell its products on the Pacific coast?— A. The Standard Oil Company of Iowa. Q. What states did it sell oil in?— A. In Washington, Oregon, California, Idaho, and the Territory of Arizona, and probably Alaska. Q. And probably Alaska? — A. Yes. Q. It was shipped principally from what point?— A. Whiting, Indiana, and Cleveland before the Whiting refinery was built. Q. After the Whiting refinery was built, principally from Whit- ing? — A. Yes. Q. Who had charge of that Standard Oil Company of Iowa ?— A. I was the president part of the time, and my brother was vice-presi- dent. Q. H. M. Tilf ord had direct charge ? — A. Yes, he had more direct charge than I had. Q. Since the acquisition of the Pacific Coast Oil Company by the Standard, where has the principal supply come from for those states which you have mentioned? — A. From California. Q. From the Pacific Coast Oil Company? — ^A. Yes. 301 Q. Made from California crude oil? — ^A. Yes sir. Q. The same oil that the Pacific Coast Oil Company used previous to that time ? — A. Yes sir. You mean the same crude? Q. Yes. — A. No, I think it is a better crude. Q. Well, it came from the same territory, didnt it? — A. Yes, but it is a much better grade of oil ; it is a process they didnt have. Q. But the oil is the same, isnt it ? — A. Well, in part. Q. The crude oil was the same? — A. Not necessarily, because there is a great variation in the oil in California. Q. Quite so. — A. And they discovered Q. From what field did it come? — A. I dont know what field it came from exactly. It comes from the Coalinga Oil field for the Pacific Coast Company, and some from the Santa Maria. I dont think that was opened up at the time, certainly not to any quantity. Q. The field from which it has taken crude oil, since you acquired it, at least in part, is the same that it took crude oil from before you acquired it? — A. To a very small extent, I think. Q. Well, since you acquired it, has the Standard Oil Company of Iowa done any business in that territory? — A. Yes. Q. Does it now? — A. It does not. Q. How many years since it has? — A. Probably a year. I dont know whether it is more or less. A very short time. Q. Well, all of the oil used by the Pacific Coast Company 302 in its refinery comes from California crude, doesnt it? — A. I think it does. 148 TILPORD. Q. You ceased shipping oil to California about a year ago? — A. Ceased what? Q. Shipping oil, you say? — A. No, we havent stopped shipping yet, but we dont ship very much. Q. You ship a little? — A. Yes. Q. Certain grades of oil? — A. Yes. Q. Small amounts? — A. Yes, comparatively. Q. Since you acquired the Pacific Coast Oil Company, your prin- cipal supply for those states has been from that company ? — A. Yes, unless it is Idaho ; I dont know whether that is or not. Q. Now, what other selling companies have you in the West? — A. The Continental Oil Company. Q. Where does the Continental Oil Company do business ? — A. It does business in Utah, and I dont know whether it does any in Idaho or not. I am not sure as to that state, whether they do both there or not. In Utah, in Colorado, in Montana, Wyoming and New Mexico. Q. And New Mexico. That is the Continental Oil Company? — A. Yes. Q. Where does it get its supply? — A. Partly from the Standard Oil Company, partly from the United Oil Company, and partly from the Florence Oil Company. Q. The Standard Oil Company of Indiana? — A. Yes. It may get some from some other Standard, I don't know; mostly there though. 303 Q. It takes all of the output of the Florence Oil and Refin- ing Company and of the United Oil Company of Colorado, doesnt it? — A. I think so. Q. And markets their entire products? — A. Well, I dont know about that. Q. Of illuminating oils, I mean. — A. I think they do ; I think it does, rather, I should say. Q. So that the Continental Oil Company markets all of the oil in the states, for the Standard companies, and the oil of the Florence Oil & Refining Company and the United Oil Company, in those states that you mention ? — A. It buys the oil as I have stated. Q. No other Standard company markets in any of those states?— A. I dont know. Q. You dont know of any? — A. I do not. Q. Now, name some other marketing companies. — A. The Stand- ard Oil Company of Indiana. Q. That is a large manufacturing company, isnt it ? — A. It is. Q. Owns the refineries at Whiting, Indiana ? — A. Yes. Q. Are those the largest refineries of the Standard Oil Com- pany? — A. I dont think so. Q. One of the largest? — A. One of the largest. Q. Well, I guess the schedule of production will show that. It also owns the refineries at Sugar Creek, Missouri, does it not? — A. Yes sir. TILFOED. 149 304 Q. Any other refinery? — A. I think not. I dont recall of any other. Q. Where does it market oil? I dont mean by selling to the other companies, but market it directly to the consumer. — A. "Well, I can state as near as I can remember, but I am not as familiar with that as I am with these other two companies. Q. Well, who would know about that particularly ?— A. Mr. Moffatt. Q. Who is the sales agent of the Standard Oil Compan}' of Indi- ana that you have mentioned, or the sales manager, or whatever you call him? — A. L. J. Drake, I think. Q. His office is at 26 Broadway? — A. Yes sir. Q. Well, can you give us your best opinion about that ? — A. Yes, I think it is the states of Minnesota, Iowa, Wisconsin, Illinois, Indi- ana, Missouri, and I think Kansas. Now there may be Michigan too. I dont know whether that covers them all or not. Q. Missouri is supplied almost exclusively from the Waters-Pierce Company, isnt it? — A. No, there is quite a good section by the Standard. Q. That is, in the northen part of the state ? — A. Yes. Q. The southern part of the state is all supplied by the Waters- Pierce? — A. I think so. Q. The Standard Oil Company of Indiana also sells oil to the Waters-Pierce Company? — A. Yes. Q. The Waters-Pierce Company gets all its supply of oil 305 from the Standard Oil companies, doesnt it? — A. I dont know about that, Mr. Kellogg. We have very little knowledge of the Waters-Pierce Oil Company's business. Q. In what territory does the Waters-Pierce Oil Company sell oil? — -A. In Missouri. Q. What part of Missouri ? — A. The southern part. There may be other parts, for all I know. In Missouri, I will say. Q. Yes. — A. In Arkansas, Texas, and Louisiana and in the Ke- public of Mexico. Q. It does not go outside of that territory, does it? — A. Yes, I think it sells some oil in Illinois. Q. That is the only exception you know of, isnt it?— A. That is the only one I can recall, yes, sir. Q. And no other company of the Standard Oil companies sells oil in the territory you have named of the Waters-Pierce ? — A. Yes, the Standard Oil Company of Kentucky sells some. Q. Where? — A. In Louisiana. Q. A part of Louisiana ?— A. Well, they sell, I think, in any part. Q. How much does it sell?— A. I dont know. It sells all it can. Q. Well, any other part of te territory that any of your companies sell in ? — A. Which company are you speaking of now ? Q. That the Waters-Pierce sells in.— A. In Illinois the Waters- Pierce sells. 150 TILPORD. Q. You have named a part of Illinois. What part of lUi- 306 nois dofes the Waters-Pierce sell in?— A. Round about East St. Louis. Q. Round about East St. Louis? — A. Yes. Q. That is all, isnt it?— A. I dont know. I couldnt answer for them. I am only giving you a general impression about them. Q. That territory around East St. Louis and some in Louisiana is the only territory that any of your companies sell in in which the Waters-Pierce sells; isnt that true?— A. Well, as far as I know. Now, there may be sales that I dont know about. Q. Well, I mean your understanding of it. — A. As far as my knowledge goes. I dont say it is the only one. Q. Now, who has charge of the Waters-Pierce? — A. In our com- pany? Q. Yes. — A. Nobody. Q. You have not a sales agent of that? — A. We have not; we ha vent anything. Q. Who is president of it? — A. Mr. Pierce's son; I forget his initials. Q. Who is the manager ? — A. Mr. Pierce is the head of it — I mean young Mr. Pierce. Pierce himself is chairman of the board, and I think Mr. Pierce's brother-in-law, A. M. Findley, is vice-president. Q. Mr. Findley was formerly an oiEcer of the Standard Oil 307 of New York?— A. He was not. Q. What company? — A. None that I ever heard of, only the Waters-Pierce. Q. None?— A. No. Q. Now, name some other marketing companies. The Standard Oil of Kentucky?— A. The Standard Oil of Kentucky. Q. Who has charge of that? — A. Mr. Pratt is the president, and Mr. Westcott has the active management. Q. What is his first name?— A. A. W. G., I think. Q. Where is his office? — A. 26 Broadway. Q. W. T. Westcott?— A. W. G., I think. Q. Mr. C. M. Pratt is the president? — A. Yes sir. Q. Mr. Westcott is the A. Vice President. Q. He is the active man ? — A. He is the active man. Q. Who is the man who has charge of the sales department of that company? — A. He is. Q. Westcott?— A. Westcott. Q. And he has offices at 26 Broadway ? — A. Yes. Q. Now, where does the Standard Oil Company of Kentucky do business? — A. In the South, but I cannot designate the states. Q. Well, south of the Ohio River? — A. Some parts of it. Q. Mr. Westcott can tell that, can he? — A. Yes, he can tell you. Q. What other marketing companies have you? — A. I do not now recall any. I might say there that I think the Standard Oil Com- th/Pobd. 151 pany of New Jersey, the Standard Oil Company of New York, 308 and the Atlantic Refining Company do their own. Q. Do their own? — A. Yes. Q. What company sells oil in Ohio?— A. The Standard Oil Com- pany of Ohio. Q. Markets it own product direct? — A. Yes. Q. Who is the sales agent of that ? — A. Managed by the vice presi- dent. Q. What is his name? — A. F. B. Squires. Q. Offices at Cleveland? — A. Offices at Cleveland. Q. Has it any agent at 26 Broadway ? — A. I dont know that it has. I am not sure, but I think not. I would not be positive. I think not. Q. It markets all its oil in Ohio, does it ? — A. I think it does, as far as I know. Q. I wish to ask you one more question about the Standard Oil Company of Kentucky. Where does it get its supply of illuminating oil? — A. A large quantity from the Standard of Indiana. I dont know whether it gets any from the seaboard here or not. Q. Mostly from the Standard Oil Company of Indiana? — A. I believe so, but I would not be positive. Q. The Standard Oil Company of Ohio markets all the oil in Ohio which is marketed by any of the Standard Oil companies? I mean illuminating oil. — A. As far as I know. Q. The Standard Oil Company of New York, where does it mar- ket its supply? — A. I think in New York state and probably else- where, but I am not familiar with the details of that. Q. Along the Atlantic Seaboard? — A. I dont know exactly 309 where it markets it. Q. Who would know about that, in the Standard Oil Com- pany of New York? — A. I think W. R. King would know. Q. W. R. King?— A. I think so. Q. His office is at 26 Broadway? I am talking about domestic trade now. — A. Yes sir. Q. Purely domestic. The territory in which it markets its product Mr. King would know about? — A. He would know about it. Q. The Atlantic Refining Company has its refineries where?— A. Philadelphia, and Pittsburg, and Franklin, Pennsylvania. Q. Where does it market its product?— A. I am not sure. Q. Who is the man in charge?— A. I am not sure about that, Mr. Kellogg ; I never had much to do with that company. Q. Could you tell by looking at the list of officers? Atlantic Re- fining Company (handing witness Petitioner's Exhibit 18) ?— A. No, this does not show. Mr. MiLBUEN. There are two cards there for each one— one direc- tors and the other officers. Witness. Yes. Mr. MiLBUEN. It does not show. 152 TILFORD. Witness. It does not show. I think they have an agent. I am not sure about that. Q. I bt'o- your pardon? — A. I dont recall who has charge of that. Q. Well, who would know? — A. Why, I suppose some of these officers of the companj^. 310 Mr. Kellogg. I am onl^- asking you for convenience, so we wont have to call somebody else to tell. Mr. MiLBURN. Isnt it Cutler ? Witness. I was thinking of Cutler, and I believe he is, but I couldnt sa_v positively. Mr. MiLBURN. We will make sure. Witness. We will find out for you. Q. Where is Mr. Cutler's office — 20 Broadway? — A. 26 Broadway. Q. Now, the Standard Oil Company of New Jersey, where does it market its products? — A. Well, it markets them — I cant name the states, but in the vicinity of its refineries. Q. ^Iiere are they? — A. One is at Bayonne, New Jersey; one is at Baltimore, and one at Parkersburg, West Virginia. Q. Who woidd know that territory? — A. Well, I can find out by asking. Q. You dont remember the sales agent's name? — A. I do not. I can find it out for you. Is somebody making a memorandum ? Mr. Kellogg. Mr. Chase, will jou make a memorandum of that — to find out the name of the sales agent of the Atlantic Refining Com- pany and the Standard Oil Company of New Jersey, and give it to us?" Mr. Chase. Yes. Q. Now, you have named all the maiketing companies, domestic trade, I mean? — A. All that I remember. Q. In the United States? — A. All that I remember, and I 311 know most of them. Q. Now, in marketing the oil for domestic trade, through- out the United States, it is shipped from the various refineries prin- cipally, if not entirely, in tank cars, isnt it? — A. Very largely, but I suppose there is a lot of it in barrels as well. Q. Mostly in tank cars? — A. I think so. Q. What is the name of the company owning the tank cars? — A. The Union Tank Line Company. Q. That is one of the Standard's companies, I believe? — A. Its stock is all owned by the Standard, except qualifying shares of directors. Q. Those cars are used then, principally, for shipping the oil from the various refineries to the marketing stations throughout the United States ?— A. I think so. Q. And it is shipped by the refinery manufacturing it? — A. Yes, I think so. Q. In your own cars. Do you use any cars of railway companies ?— A. We may, yes ; probably do use some, but not a great many. Q. Not many? — A. Some, I think we use. TILPOKD. 153 Q. Almost exclusively ship in your own cars? — A. I would not say exclusively. We would be glad to use railway cars if we could get them. Q. Well, I am simjDly asking for the fact. — A. Most of it is in our own, a very large majority. Q. Is that substantially all of it or A. Oh, I think there 312 is some in other cars. The Pennsylvania has some cars; I dont know how many of those we use. Q. As compared Math your total shipment, is it a small per- centage? — A. It is a small percentage, yes. Q. Now, take the Standard Oil Company of Kentucky. You were pretty familiar with its business, werent you? — A. I was years ago, not now. Q. It ships substantially all its illuminating oil which it develops through the southern states, south of the Ohio river, from Whiting, Indiana, since 1889, doesnt it? — A. Well, I couldnt answer that. I would rather Mr. Westcott would answer that. They may take some oil down the Atlantic coast by water. But I am not familiar with that, and I would rather he would answer it. Q. That which it does ship from Whiting is shipped by the Stand- ard Oil Company of Indiana, is it? — A. Yes. Q. To the Standard Oil Company of Kentucky? — A. I think so. Q. You have tank stations at various stations on the railroads throughout the United States, havent you? — A. You mean the rail- roads connecting with them ? Q. Yes. — A. Yes. Q. I mean situated on the railroads. — A. Yes. Q. And the manner of doing the business is to ship to tank stations by tank cars? — A. Yes. Q. From these tank stations how do the marketing com- 313 panics distribute the oil to the purchasers? — A. I am not fa- miliar with the details of that. Q. Will these men you have named be more familiar with it ? — A. Yes, they will be more familiar with it. Q. I wont waste any time with you, then, on that subject. — A. I only know the general principles of the subject. Q. Can you give it to us any way?— A. I have told you most of the general principles I am familiar with. Q. All right. You can give us the location of the refineries of each one of the sub-companies of the Standard Oil Company, can you not ? — A. I can give most of them, yes. Q. Take the Standard Oil Company of Indiana. You have already given that. — A. Yes. Q. And the Pacific Coast Company, its refineries are at Point Kichmond ?— A. Yes. Now Standard Oil Company, of course. Q. Yes, now Standard Oil Company of California. Mr. MiLBTJRN. The Standard Oil Company of New Jersey, did he give Constable Hook ? Witness. I called it Bayonne. 154 TILFORD, Mr. MiLBTjEN. That is Bayonne? Witness. That is Bayonne. Mr. Kellogg. I will get that separate, Mr. Milburn. Mr. MiLBTjEN. All right. Q. You have a refinery at Neodesha, Kansas ? — A. Yes. Q. What company owns that? — A. I think the Standard of Kan- sas, but I dont want to make that positive, because I am not much acquainted with that. 314 Q. The Standard Oil Company of New Jersey, where are its refineries situated?" — A. At Bayonne, and possibly at Consta- ble Hook. I dont know whether they have one there or not. It is in that vicinity anyway. Q. And at Baltimore, Maryland? — A. At Baltimore, Maryland, and at Parkersburg, West Virginia. Q. That is the way it is here. The Vacuum Oil Company ? — A. At Rochester, New York, and Olean, New York. Q. The Standard Oil Company of New York ? — A. Over on Long Island. Q. And at Buffalo, New York?— A. At Buffalo, New York, yes. I had forgotten that. Q. At Brooklyn and Long Island City, or is that the same place? — A. When I said Long Island that means those. Q. One at Brooklyn, and the other at Long Island City? — A. I think there are two. Q. Atlantic Refining Company? — A. At Philadelphia, Pittsburg, and Franklin, Pennsylvania. Q. That Philadelphia is called Point Breeze? — A. I think it is. Q. Solar Refining Company? — A. Lima, Ohio. Q. And the Standard Oil Company of Ohio ? — A. Cleveland, Ohio. Q. Standard Oil Company of Indiana, you have given that? — A. Yes sir. Q. Whiting and Sugar Creek. Standard Oil Company of 315 Kansas you have given as Neodesha, Kansas? — A. Yes. Q. That is correct ? That covers all of the refineries ? — A. I think so. Q. That you know of, belonging to the Standard Oil ? — A. Yes. Q. You are not familiar with the details, as I understand, of the sales of oil by these selling companies and their system of accounting or reports to New York, or anything of that kind ? — A. No, I am not familiar with the details. Q. Mr. H. M. Tilford is? — A. To some extent I suppose he is. I dont Iniow exactly how far he goes into that. Q. For how many years has the Continental Oil Company, if that is the correct name A. Yes sir. Q. Taken the output of the refineries of the Florence Oil & Refin- ing Company and of the United Oil Company of Florence, Colo- rado? — A. For a number of years, quite a number; I cant tell you when they began. Q. And still does take it? — A. Yes sir. TILFOED. 155 Q. In the Continental Oil Company who would know the details of that? — A. Mr. H. M. Tilford. I dont know how far he would know the details. The vice president out there laiows. Q. Mr. H. M. Tilford is not in the city, I believe ?— A. No. Q. When do you expect him back ? — A. About the first of October. He would know more than anybody here in New York. Q. You dont remember the dates of those contracts with the United Oil Company ? — A. I do not. I didnt know there were 316 any contracts. Q. You didnt know there were any written contracts? — A. No sir. Q. Would Mr. H. M. Tilford know more about that?— A. I think he would. At least if I ever knew I have forgotten. I dont remem- ber now anything of that kind. No, I dont say there were none, Mr. Kellogg. Q. No, I understand that perfectly. I will ask Mr. H. M. Til- ford. — A. I am not advised. Q. Was he in more direct charge of that? — -A. Yes. Q. Did he negotiate whatever arrangements were made? — A. I think he did of late years. I had something to do with it years ago. Q. You did have something to do with it ? — A. I think I had when the United first began doing business. Mr. MiLBUEN. This is 1887 or 1888 or 1889? Q. It it stated in the answer (I merely mention this to refresh your memory) that the United commenced to refine in the year 1887 or 1888, the precise time the defendants are unable to state. It had a contract with the Continental Oil Company? — A. I dont remember that. Q. Did you negotiate that contract? — A. I dont think so, but I dont remember. Q. Do you remember negotiating the contract with the Florence Oil Company? — A. I dont think I did. I think that was 317 done out there, but H. M. Tilford would tell you better than I could about this whole thing. Q. Do you remember one of those companies commenced to sell its own product, and one of those companies had a rate war in selling oil ? — A. Not one of those companies ; it was another company. Q. What was the other company? — A. I cant think of the name of that ; it was some other company, it wasnt one of these. Q. Where was it situated? — A. In Colorado. Q. When was that? — A. Some years ago. Q. That was between the Continental and this other company, was it?— A. Yes. Q. And the Continental put it out of business?— A. Well, they put themselves out. Q. Well, they were put out of business?— A. They were part owners in the United. Q. They were part owners in the United ? — A. Yes. 156 TILFOKD. Q. And there was a fierce war of competition between them for a while, wasnt there? — A. They were not satisfied with the interest in the United and they built another refinery to take part of their own business. Q. And then you went after them ? — A. They went after us. Q. But they got caught? — A. They did, because they didnt know anything about the business. Q. During that war the price of oil went down about one half, didnt it? — A. I dont remember the figures at all. They sold oil at less than cost of freight and jsackages, some. 318 Q. And so did you? — A. I don't think so. I dont think we had to. Q. You could sell it cheaper than they could? — A. We could; we could handle it cheaper than they could. Our mai'keting facilities were much better than theirs. Q. And how long did they last ? — A. I don't know. Q. It wasn't a long while? — A. Quite a while. Q. And then they disappeared? — A. And then they disappeared. Q. The United Oil Company and the Florence Oil Company have since sold all their products to you? — A. I think so. All their re- fined, anyway ; I don't know about the other products. Q. And since that time there has been no other marketing com- pany selling oil in the territory you name — those states? — A. Again I would like H. M. Tilf ord to answer that. That is a detail I might not Q. You don't know? — A. I do not, but it is a detail I might not be familiar with. Mr. MiLBUEN. There is an instance of the supreme value of compe- tition. Mr. EjjLLOGG. For a while. Mr. MiLBTJEN. This is an age of competition. Mr. Kellogg. As soon as the Independent Witness. I will say to you, Mr. Kellogg, if you don't mind my interjecting it Mr. Kellogg. Not a bit. Witness. That while they lost money we did not. Mr. Kellogg. I have no doubt that is true. And you could 319 last longer than they could? Witness. On that basis. Mr. Kellogg. Yes sir. Q. And aftei' that war, if you call it that, that fierce competition, and they disappeared, the price of oil immediately went up, didn't it? — A. The refineries put up their oil to us, and we had to put ours up. Q. It was put up anyhow? — A. It was put up by the refineries. Mr. MiLBt KN. That is the usual case after a war, isn't it? Things go up. Q. TVell, now, do you remember another concern, known as the- Mr. MiLBUEN. We didn't get the name of that concern, did we? TILFOED. 157 Mr. Kellogg. He didn't know the name. Q. Do you know the name of that ? — A. I don't ; I can't recall that name at all. Its refinery was located at Pueblo, Colorado. Q. At Pueblo?— A. Yes. Q. Do you remember Scofield, Shurmer & Teagle? — A. I know of the firm, yes. Q. Headquarters at Cleveland, Ohio? — A. Yes. Q. Were they a manufacturing or marketing concern ? — A. Both. Q. A^liere were their refineries situated ? — A. At Cleveland. Q. Cleveland, Ohio?— A. Yes. Q. Where did they market oil ? — A. Oh, I think all over the West and South, or part of the South, anyway. 320 Q. Some in St. Louis, didn't they?— A. I think they did. Q. Had quite an office in St. Louis? — A. I don't know about that. Q. They had an office there? — A. I don't know aboiit their affairs. Q. You knew of them, didn't you ? — A. I knew of them. Q. Quite a large firm, wasn't it ? — A. Yes. Q. Did they have quite a large refinery? — A. I don't know. Q. Years ago then disappeared from business as a firm? — A. Some years ago ; I can't remember. Q. Their property was bought by one of the Standard's companies, was it ? — A. Yes sir. Q. What company ? — A. The Eepublic. Q. The Eepublic Oil Company. It was organized by the Stand- ard Oil Company, wasn't it? — A. Well, either by them or for them, I don't remember. Q. To take over the property of Scofield, Shurmer & Teagle? — A. Yes. Mr. MiLBUEN. When was this ? Q. About when was this? — A. Some years ago. Mr. MiLBTjEN. Is there anything about that in the bill? I don't remember. Mr. I^LLOGG. No, I don't think so. Q. Well, now was that sale about 1901?— A. Why, it may have been; I have no memory of the date; I know it was some years ago. 321 Mr. MiLBUEN. Does he know anything about it? Q. You negotiated the sale, didn't you ?— A. I did in part. Q. And after you negotiated the sale, what became of the refinery of Scofield, Shurmer & Teagle?— A. My recollection is that it was dismantled, because they retained the real estate. Q. Dismantled ?— A. Made a condition it should be dismantled. Q. And their marketing plant in Missouri was dismantled too, wasn't it ? — A. That I don't know ; I am not familiar with that. Q. Whatever other assets they had were taken over to the Re- public? — A. I think they were. Q. Now, for some years after that, the Eepublic was not known as a Standard Oil Company, was it?— A. I think it was. 158 TILFOBD, Q. Are you sure of that ? — A. Why, there were circulars issued by competitors to that effect. Q. Yes, the competitors said it belonged to the Standard Com- pany? — A. Yes. Q. But you people didn't, did you? — A. I don't know what we said, or that we said anything. Q. You don't know that you said anything? — A. I don't know that we did. Q. Don't you know as a matter of fact that the Republic Oil Com- pany was held out to the world and doing business claiming to be independent of the Standard ? — A. I don't know what it claimed, Mr. Kellogg. I only know of the thing up to its organization and launch- ing, and I did see circulars from competitors claiming that it was a Standard concern. 322 Q. You saw circulars from competitors A. Yes. Q. Of the Standard A. Yes. Q. Claiming that the Republic was a Standard concern? — A. I did, but what the management of the Republic itself said I have no knowledge of. Q. You never hear of their saying it was Standard, did you? — A. I never heard of their saying either whether it was or was not. Q. Who were the managers of the Republic when it was started ? — A. Mr. Walter Teagle. Q. Mr. Walter C Teagle?— A. Yes. Q. Where is his of&ce ? — A. Now at 26 Broadway. Q. Is he in the city ? — A. No sir ; he is in Europe. Q. Where is he ? — A. In Europe. Q. And when is he expected to return ? — A. I don't know when he is coming back. He had not previously been connected with the Standard Oil Company when he was in charge of that company. Q. No, he was one of the firm of A. He was the son of the original Teagle; I don't know whether he was a member of the firm or not. Q. He was connected with the firm of Scofield, Shurmer & Tea- gle? — A. I dont know whether he was a member of the firm, but he was a son of Mr. Teagle, Sr. Q. And after the purchase he went into the Republic? — A. After the purchase he went to the Republic. Q. And has since remained there? — A. No, he left the Re- 323 public and came to the Standard a few years ago; stayed some time with the Republic and then came to the Standard. Q. Oh, he did. Who has charge of the Republic now ? — A. Out of business, I think. Q. Practically out of business ? — A. Practically out of business. Q. At the same time that you purchased the assets of Scofield, Shurmer & Teagle, you purchased a refinery at Cio, didn't you? — A. I think there was a place there, now that you speak of it. I had for- gotten it. TILFORD. 159 Q. Who did that belong to?— A. I presume it belonged to the same party. Q. That was dismantled also, was it?— A. I don't know about that. Q. You don't know about that? — A. No. Q. Well, now, previous to the purchase of the concern of Scofield, Shurmer & Teagle, they were sharp competitors of the Standard, were they not? — A. They were. Q. And they brought a suit against the Lake Shore Eailroad for damages for rebates paid to the Standard, didn't they, denied to them? — A. Well, I don't know about that. Q. You don't know about that ? — A. No. Q. Did you ever hear of it?— A. Yes, I have heard of it. Q. You have read of it?— A. Possibly. I have heard of it some way, but I don't know about the facts. Q. Now, there was litigation over it? 324 Mr. MiLBUBN. I object to this evidence as immaterial and as not within the allegations of the bill — the petition. Mr. Kellogg. Well, he says he only heard of it. Q. What other companies, partnerships, or business organizations engaged in any branch of the oil business have you been instrumental in negotiating for the purchase of? — A. I cant remember any just now. Q. You don't remember any ? — A. No. Q. Do you remember the purchase of the Argand Refining Com- pany? — A. I do not. Q. You don't remember that? — A. No; I didn't take part in that, that I know of. I would remember it if I had. Q. Bartles & Richardson? — A. No. Q. Do you remember the Indiana Pipe Line and Refining Com- pany ? — A. I remember there was such a concern. Q. Where was its plant situated ? — A. I can't recollect ; somewhere in Indiana, I suppose, but I don't remember where. Q. That was purchased and dismantled, wasn't it? — A. I don't know. Q. You don't remember that ? — A. I don't remember that. Q. Well, you could make up a list, couldn't you, of the corporations, limited partnerships, partnerships, business organizations engaged in any branch of the oil business which have been acquired by the Stand- ard or some of its sub-companies since you have been connected with it? — A. I don't think I could. Q. You don't think you could? — A. No, I dont know how I am going to get the data. 325 Mr. MiLBUKX. I think each one would have to be inquired into, Mr. Kellogg, so we would have to have the people who know about it. Q. Well, take it since 1889, the books must show, do they not, the acquisition of all stocks and properties of outside concerns? — A. I don't know. I don't know anything about it. 160 TILFOBD. Q. You don't know anything about it? — A. No, I don't know what they show. I never have anything to do with the books. Q. And you only remember the three companies I have called your attention to? — A. That is the only three I remember; if you can give me any other name I will tell you if I can recall it, but I don't remember any others. Q. Well, Bartles & Richardson of St. Paul?— A. I don't know anything about them. Q. Indiana Pipe Line & Refining Company? — A. I don't know what was done with them. Q. Denlinger Bros. Oil Company? — A. Xo. Q. Bedford Petroleum Company? — A. There is a Bedford Pe- troleum Comjjany in France ; I don't know of any other. Q. Borne-Serymser Company? — A. I know that their stock Ivas bought. Mr. MiLBUEN. What is that? Witness. Borne-Scrymser Company. Q. When was this? — A. I don't know; some years ago. Q. Wheie were they engaged in business? 326 Mr. MiLBUEN. I object to this evidence on the ground that it is immaterial and not a matter alleged or set forth in the petition or bill. A. I think in New York and New Jersey. Their headquarters may have been here, but I think they were located in New Jersey. Q. How long ago did you acquire that? — A. I don't remember. Q. Carter Oil Company ? — A. I don't remember about that. Q. Empire Refining Company? — A. I don't remember about that. Q. Gilbert & Parker Manufacturing Company? Mr. MiLBUEN. Barker? Mr. Kellogg. Yes, Parker. A. I don't remember about that either. I know we have an inter- est in that company. Q. 'Where is it? — A. The company? Q. Yes. — A. It does business in New England, but I don't know where. Q. You have an interest in it? — A. We have an interest, but I don't know how much. Q. You appear to own 400 shares in that. Do you know the num- ber of shares? — A. In which company? Q. Gilbert & Barker Manufacturing Co. — A. No, I do not know. I know really nothing much about the concern. Q. Hazelwood Oil Company? — A. I don't know about that. Q. Marion Oil Company? — A. I don't know. about that. Q. Pennsylvania Lubricating Company? — A. We have an interest in some company of a name that sounds like that, but I cant answer positively. Mr. MiLBUEN. What is that? Mr. Kellogg. Pennsylvania Lubricating Company. TILPOBD. 161 Mr. MiLBUEN. Pennsylvania Lubricating Company, you 327 have got that, 500 shares. Q. 300 it says here. Mr. MiLBURN. 300 shares. Q. Swan &'Finch?— A. Yes, we own that, I think, or most of it. Q. When did you buy that ?— A. Oh, it must be a great many years ago. Q. It was. — A. I didn't conduct the negotiation. Q. Underbuy Oil Company?— A. I think we have an interest in that, but I am not able to give you the information. Q. You don't know when you bought it? — A. No sir. Q. Now, Mr. Tilford, you have been pretty active in this business, haven't you ? — A. Fairly so. Q. You can't tell me any other companies previously engaged in business, or any other partnerships or corporations which the Stand- ard Oil Company or its sub-companies has purchased? — A. I can not, because I have had very little to do with negotiations of that character. Q. Well, who has had more to do than you ? — A. I should say Mr. Archbold had more than anybody else in the company. Q. Mr. Archbold? — A. Yes sir. Q. Do you remember the transfer from the National Transit Com- pany to the Standard Oil Company of New Jersey on December 31, 1905, of the stock of a large number of companies ? — A. I do. Q. I show you a list of companies and ask you if that is a 328 list of the companies whose stocks were transferred from the National Transit Company to the Standard Oil Company of New Jersey on that date. — A. Now, of course, Mr. Kellogg, I can't remember all these. Q. You can't ? — A. But I know there were a number of companies, and if it is taken from some proper record, why, I have no doubt it is correct. Mr. MilbtjejST. Well, assume it to be correct. Witness. I am willing to assume it to be correct, if Mr. Kellogg says it is. Mr. MiLBTjRN. Yes; the correctness of that I don't ask you for. I simply want to connect up the companies. Witness. I remember the transaction. Mr. Kellogg. Assume that to be correct. I will mark that as a list by itself. The list was marked Petitioner's Exhibit 21. Q. Mr. Tilford, do you know the reason why the stocks of there various companies were transferred from the National Transit Com- pany to the Standard Oil Company of New Jersey on November 31,1905? Mr. MiLBTjKN. Will the stenographer be good enough to say these various companies ? 32555—08 11 162 TILFOED. Mr. Kellogg. The various companies referred to in Exhibit 21. 329 Mr. MiLBUEN. That is it ; then I will know what I am about. Witness. Shall I answer that? Mr. Kjillogg. Yes sir. Witness. An officer of the National Transit Company came to me and said that that company would like to sell this list of stocks to the Standard Oil Company of New Jersey, and I looked at the list and at the prices he proposed to ask, and agreed to the suggestion. I thought we had just as well take them. Mr. MiLBUEN. Let me see that list so that I may know what they are. Q. Well, the Standard already owned the National Transit. — A. Yes. Q. And the National Transit owned these? — A. Yes, it seems so. Q. Now, what was the object of getting them out of the National Transit and into the Standard? — A. I dont know what his object was. I didn't know at the time they owned all those companies. Q. Well, wasn't it to separate the business of the National Transit as a pipe line from the business of these various concerns ? — A. Well, there was no motive stated to me ; I didn't know of any. Q. No reason stated to you? — A. No; he said he wanted to sell them, and I thought the Standard Oil Company of New 330 Jersey was a good company to have them. Q. Well, it already had them, didn't it? — A. Only through the National Transit. I thought it was a good thing for them to have them direct. Q. To have them direct ? — A. Yes. Q. The National Transit Company is a large pipe line company, isn't it?— A. Yes. Q. Owning the principal pipe line in Pennsylvania? — A. I don't know what the lines are. Q. You are not familiar with the details of the pipe lines ? — A. No. Q. Well, it is a large pipe line company ? — A. I think it is. Q. And you don't know that that was done for the purpose of getting rid of all companies engaged in other business than piping oil ? — A. I do not, no. It wasn't stated to me. Q. Did you ever hear of the Alabama Oil Company, Birmingham, Alabama ? — A. No sir. Q. Don't know anything about it. The Argand Refining Com- pany, Marietta, Ohio, you have heard of? — A. I have heard of it. Q. That was purchased by one of the Standard Oil Companies? — A. I don't know. Q. Don't you know its refineries were dismantled ? — A. I do not. Q. You don't know about that? — A. I don't know about that. Mr. Tilford, you know the Tidewater Pipe Company, Limited, and the Tidewater Oil Company, do you? — A. Yes, I know 331 there are two concerns ; is that what you mean ? Q. Yes. — A. Yes sir. tiilFoed. 163 Q. You remember a contract made with the Tidewater Pipe Com- pany, Limited, about 1883 ? — A. I do not. Q. Don't know anything about it? — A. Don't know anything about it. Q. Ever heard of it? — A- I have heard talk since these proceed- ings began. Q. Never heard of it until then? — A. I wouldn't like to say that. I never knew there was any such contract that you speak of. Q. You never knew there was any such contract? — A. I did not. That is, I mean I never knew anything about it. Q. Never knew anything about it ? — A. No. Q. In a schedule attached to a copy of a contract which purports to have been executed by the Standard Oil Company of Ohio, the Standard Oil Company of New York, the Standard Oil Company of Cleveland, and a supplemental agTeement of the same date by the National Transit Company and the United Pipe Lines, with the Tidewater Pipe Company, Limited, there is a list of refineries which purports to be a list of refineries or companies connected with the Standard organization and a list connected with the Tidewater organ- ization. Will you look at that list on page 261. (Handing witness the bill of complaint.) — A. I have looked at it. 332 Q. Are you familiar with that list of companies ? — A. I rec- ognize some of them, not all. Q. You are not familiar with all of them ? — A. No, I am not. Q. Well, the Atlas Eefining Company, of Buffalo, New York, was that a Standard concern ? — ^A. Yes. Q. It was? — A. It was. Q. Acme Oil Company, of Pennsylvania.— A. There was such a concern, but I think it is out of existence now. Q. I know it is probably out of existence now, but it was in the trust agreement, wasn't it ? — A. I don't know. Q. Well, it was, at one time, connected with the Standard organ- ization, wasn't it? — A. I don't know of that of my own information. Q. Acme Oil Company, works at A. I don't know about that. Q. Atlantic Eefining Company was?— A. I know about that, be- cause it exists now. I don't know much about anything at that period. Q. You don't know much about what existed in 1883 ? — A. No. Q. Who would be more familiar with that than you?— A. Mr. Archbold. Q. There was one question I didn't ask you about the Trust period. I think you said you became one of the Trustees about 1886 or 1887?— A. No, 1887 or 1888. Q. 1887 or 1888 ?— A. Yes sir. Q. One of the Trustees of the Standard Oil Trust?— A. Yes Sir. 333 Q. Do you remember that in 1887 the Standard Oil Trus- tees, that is, the Trustees of the Standard Oil Trust, issued a stock dividend of $15,028,200?— A. I do not. 164 TILrOED. Q. Do you remember any stock dividends at all? — A. You mean the Trustees ? Q. Yes sir. — A. There was a dividend that I heard of, but I don't know the particulars. Q. You don't know the particulars ? — A. No. Q. You don't know the amounts ? — A. No sir. Q. And you don't know the amount at which the stock of the various companies was taken in, 1882 ? — A. No ; oh no. Q. Do you know W. E. Bemis ? — A. Yes sir. Q. Did Mr. Bemis ever have anything to do with domestic sales in this country? — A. Yes sir. Q. For how many years ? — A. I don't remember. Q. Now, about when did he become connected with the domestic trade? — A. I can't give you any estimate at all. Q. He was connected with it a good many years? — A. I don't know that. Q. About when did he cease to be connected with it? — A. I think several years ago. Q. Where did he have an office ? — A. 26 Broadway. Q. What was his title? — A. I don't know whether he had one or not. Q. What was the position he occupied? — A. In the domestic trade ? 334 Q. Yes. — A. I don't know that; he probably attended to some features of the business, but I don't remember. Q. You never heard? — A. I may have heard, but if I did I have forgotten. Q. Well, quite a prominent official, wasn't he? — A. Yes. Q. Connected with that business in 1905, wasn't he? — A. Well, I couldn't answer as to the date. Q. Had an office at 26 Broadway, hadn't he? — A. At 26 Broad- way, yes. Q. Has an office there yet? — A. Yes sir. Q. What is his title now ? — A. He hasn't any. Q. What is his business now ? — A. He is connected with the export department. Q. When did he become connected with that? — A. Several years ago. Q. Has he any other duties than the export? — A. I don't know. Q. Is there any one in his office ? — A. Yes, I think there is. Q. Who is it?— A. I don't know. Q. What room does he occupy ? — A. I can't tell you that. He re- cently moved out of the room that he did occupy. Q. What was the room that he did occupy? — A. A room on the twelfth floor at 26 Broadway. Q. What was the title of the office, do you know ? — ^A. I think just his name, as far as I know. TILFOED. 165 Q. Is Mr. Bemis expected back? — A. I don't know that. He has been abroad for a long time. 335 Q. How long ?— A. I should say eight or ten months he has been to the Far East. Q. Have you ever been in his office ? — A. Not in his present office. Q. Were you in his previous office? — A. I don't recall whether I ever went in there or not, certainly not very often. Q. I mean his former office. — A. I may have been in there, I don't recall. I certainly did not go often enough to remember about it. Q. You don't know whether he had an assistant or clerks? — A. Oh, I think he has got some clerks. Q. You don't know who they are ? — A. No. Mr. Kellogg. I think that is all. Mr. MiLBUEN. I want to ask Mr. Tilford some questions connected with the subjects about which he has been examined, and I would like to look over the minutes, and I would like also to consult with Mr. Rosenthal, when he is here on Monday morning, in respect to what was in his mind on that subject. I had no opportunity to in- quire before he went away yesterday. Therefore, as it is four o'clock, I would ask, as we were not to take up anybody else than Mr. Tilford this afternoon, to have the matter go over until Monday morning, and Mr. Tilford will take the stand, and I will probably be occupied with him fifteen minutes or half an hour. Mr. Kellogg. I have no objection. The Examinee. The further hearing of this case is adjourned until Monday morning, September 23, at 10 : 30. 336 Monday, September S3, 1907. The hearing was resumed at 10 : 30 A.' M. Wesi^t H. Tilfoed, recalled as a witness on behalf of Petitioner, testified as follows: Direct examination (resumed) by Mr. Kellogg: Q. Mr. Tilford, I wish to ask you a few more questions. About that Manhattan Company, did you look up the matter that I requested you to find out, if it sold its cars and refineries and producing wells ? — A. I looked up about the cars. I have no nieans of ascer- taining from the other companies ; I have no connection with them. Q. What did you find?— A. I found that the Union Tank Line bought 764 cars from the Manhattan, in the years 1899, 1900 and 1901. Q. What price did it pay?— A. Well, I cant give you the exact figures. It was between four hundred and four hundred and fifty thousand dollars. Q. Bought for cash?— A. I imagine so. I didnt ask that, I didnt think you wanted that. Q. Mr. Felton would know the details of it, would he? You dont know for sure whether Mr. Felton would know the details or not?— A. No, I dont know. He was not there this morning. 166 TILFOKD. Q. What time in 1899 was it? — A. 1 dont know that; I could 337 get all that for you. I didnt know you wanted it. Q. Yes, I want the details of that, but I can probably get it from Mr. Felton. Mr. MiLBUEN. He can get it for you, if you wish. Witness. I can get it. What details ? Q. I want the date of each pui-chase, the price paid, how it was paid, whether in securities or cash. — A. All right. Q. Did you hear Mr. Benedict's testimony ? — A. No sir. Q. I asked Mr. Benedict if any arrangement was made with the Standard Oil Company for guaranty or protection when they sold the Manhattan Oil Company stock, as he testified. Do you know of any such arrangement? — A. I do not. Q. You know of no understanding or arrangement by which the Standard Oil Company of New Jersey, or any of the companies con- nected with it, or in which it owns stock made any guaranty or con- tract or guaranty of any kind, to insure the gas companies with which Mr. Benedict was connected, a supi^ly of oil. — A. I do not, except — I dont know anything about which companies he is connected with the stock of. Q. Well, he said the Indianapolis Gas Company and the People's Gas Light & Coke Company, of Chicago. — A. I dont know anything about the Indianapolis company. We have a contract to supply the Chicago company with gas oil ; that is all I know. Q. "V^^len was that contract made ? — A. Eight or nine years ago. Q. About when ? — A. About eight years ago. 338 Q. About 1899 ?— A. That would make it about 1899 ; I am not accurate as to date, because I dont have any record of that. Q. Wliat time in 1899 ?— A. I dont know. Q. Who made the contract ? — A. I dont know who negotiated it ; I signed it, I believe. Q. You signed it? — A. Yes, I think so. Q. For how many years was that contract to run ? — A. Ten years. Q. What was the nature of it ? — A. To supply them with oil, at an agreed price. Q. Have you that contract? — A. I have not. Q. Who has? — A. The Chicago office, The Standard of Indiana. Q. Between whom was it made, between what companies ? — A. The Standard Oil Company of Indiana and the Gas Company. Q. Who negotiated it for the Gas comjiany? — A. I dont know. Q. Do you know Mr. Benedict? — A. I do not. Q. Do you know Mr. Brady ? — A. No sir. Q. You dont know him? — A. I dont know him. Q. Well, that contract was made in 1899? — A. I presume it was made at that time, but I dont remember. Q. Then, the Standard Oil Company of Indiana did insure or guarantee by a contract the Chicago Gas Company a supply of oil for ten years, didnt it ? — A. Yes. TIIiFOED. 167 Q. That was at the time they sold out the Manhattan wasnt it ? — A. Well, that I dont know. 339 Q. Dont you know they sold the Manhattan in 1899 and immediately you made that contract. — A. I do not. Q. Dont you know that contract was a consideration for the sale of the Manhattan Company ? — A. I do not. Q. You dont? — A. No sir. Q. You swear it was not? — A. I do. No, I wont swear it was not; I will swear I dont know anything about it. Q. You don't know anything about it ? — A. No sir. Q. Dont know that Mr. Brady and ]Mr. Benedict refused to sell the Manhattan Oil Company until they received a contract guaranteeing them a supply of oil for ten j'ears ? — A. I do not. I never heard them say anything about it. Q. You never heard anything about it ? — A. No sir. Q. Well, isnt it a little strange that the contract was made in 1899, in 1899 the Standard bought the cars of the Manhattan and that you dont know anything about it ? Mr. Mii^TJRN. I object to that question ; it is argumentative. It is not a question to elicit evidence. Q. Please answer? — A. TVliat will I answer. Mr. MiLBUEN. I have got my objection, all the same, in the record. A. You mean answer if it is strange that I dont know about it? Q. Yes, sir. — A. I dont think it was. Q. You were president of the Stanlard Oil Company of Indiana ? — A. I was, but I. had no negotiations with Messrs. Benedict and Brady. 340 Q. You were president of the Tank Line ? — A. I was presi- dent of the Tank Line Company, yes. sir. Q. I would like to have you produce that contract between the Standard Oil Company of Indiana and the Chicago Gas Company.— A. I will if I can. Q. Who is at the head of the Chicago Gas, now ?— A. I dont know. Q. Do you know who was at that time ? — A. No sir. Q. Who negotiated the contract?— A. I dont know. It came to me for signature, and I dont know who sent it to me. I signed it. I had nothing to do with the details of the business, anyway, at that time. Q. You signed a contract for a supply of crude oil to the Chicago Gas Company for a period of ten years ?— A. Yes sir. Q. And made no inquiry into it whatever ?— A. I did not. It came to me in the regular way. I sign a great many papers that come to me from proper departments, and I sign them. Q. Who sent it to you?— A. I dont know. I didnt know it had been executed by me until lately, when Mr. Moffatt told me. Q. You havent that contract here ? — A. No sir. Q. Now, it appears by the statement which you produced on Fri- day, Petitioner's Exhibit 19, that the only stock in the Standard Oil Company of New York which had been distributed by the Trustees 168 TILFOED. up to and including January 7, 1896, was stock to the list of men who voted at that meeting. 341 Mr. Rosenthal. Let me hear that question. (The question was read.) Q. That is true, isnt it? — A. If the statement says so; I dont know whether it is correct or not. Q. Well, you have no doubt of its correctness, have you? — A. I believe it to be correct. Q. It shows every share of the Standard Oil Company stock? — A. I believe it to be correct, I dont know it. Mr. MiLBTJEN. Well, that doesnt follow. That is an argument. Mr. Kellogg. It follows exactly. Mr. MiLBUKN. Mr. Kellogg, if there were assignments of legal in- terest out for the most of that thirty-four thousand Mr. Kellogg. No, but there were not. Mr. MiLBUEN. Nobody knows there were not. The legal title would still be in the Trustees, and they would be registered. Mr. Kellogg. But it wasnt out, Mr. Milburn, and I believe Mr. Tilford knows it wasnt out. Mr. iMiLBURN. If Mr. Tilford knows that legal assignments for those 34,000 shares were not out. that is another thing, but he hasnt testified so far. Mr. IvELLOGG. I will ask him. Q. Mr. Tilford, dont you know that from 1892 until 1897, the only stock which was distributed at all in any one of the twenty 342 companies was stock re23resented by 494,619 shares out of 972,- 500 shares of the Standard Oil certificates? — A. I do not. Q. And that was all distributed in 1892 ? — A. I do not. Q. And that the only persons to whom stock was distributed at all were the following (during those years, I mean) : John D. Rocke- feller, William Rockefeller. H. M. Flagler, Benjamin Brewster, John D. Archbold, H. H. Rogers, W. H. Tilford, O. B. Jennings, who were the Trustees, I believe — the Liquidating Trustees — C. W. Harkness, Esther B. Jennings, Walter Jennings, Helen G. Jennings, Oliver G. Jennings, Anna B. Jennings, Emma B. Auchinloss, the estate of Charles Pratt, and O. H. Payne ? — A. I do not, Mr. Kellogg. I have no recollection of how many were issued. When that statement was produced, that was the first time I knew anything about what quan- tity was voted. Q. Now, that was a bare majority, 494,619 shares being a bare majority of the trust certificates. If those men were the only ones to whom stock was distributed, then those Trustees, together with the stock they held as Trustees of the Standard Oil Trust, controlled all those corporations during all those years, did they not ? Mr. Milburn. Now, I object to that question as purely argu- mentative, calling for conclusions, and I dont think you need answer it, Mr. Tilford. TILFOKD. 169 Mr. Kellogg. All right, tell him not to answer it if you want to. 343 Mr. MiLBUKN. That is arguing the case. You have got the papers there. Now, to elicit evidence is one thing, but I dont think you should be arguing the case with the witness at all. Mr. Kellogg. All right, if Mr. Tilford dont want to answer it, he may refuse to. Mr. MiLBUEN. He will answer any question that asks for evidence or for testimony. That question does not. You are asking him for his opinion, whether if certain things have not been proved are so and so, certain legal consequences follow. Now he need not say he wont answer. He can say he doesnt know how to answer. Mr. liELLOGG. All right, tell him what to answer. Q. "V\^at answer have you to make? Mr. MiLBTjRN. Hear that question over again, and if you can un- derstand it, answer it. Q. Well, I will ask it in a different way. Mr. MiLBUEN. No, let us hear the question. I dont understand it, but Mr. Tilford may. Mr. Kellogg. Read it over. (The question was read.) A. Will I ans .ver it as I think I would answer it if no discussion had occurred? Q. Yes. — A. I do not know, of my own knowledge whether those were the only stocks distributed among the individual stockhold- ers or not, and I do know the stock which had not been dis- 344 tributed did not vote. Q. I assume that the stock which had not been distributed did not vote, but I ask you if the men whose names I read to you were not practically the only stockholders in the twenty companies who did vote from 1892 to 1899. Mr. MiLBUEN. If he knows, or doesnt know. Witness. I beg pardon. Mr. MiLBURN. I say if you know, you can answer. A. I do not know. Q. You have no recollection, then, whether those leading men were the principal stockholders who held stock during those years? — A. I remember who were the principal stockholders, but I dont re- member whether all the men on that list you read were the only ones to whom stock was issued. Q. Do you know Mr. John Bensinger? — A. I do. Q. Is he sitting here in court ? — A. Yes sir. Q. Was he the transfer agent of the Trustees or of the Liquidating Trustees, during all the time of the existence of the Liquidating Trustees? — A. I do not remember; he was the transfer agent, but I dont remember how long he served. Q. You knew him ? — ^A. I did. Q. You knew him as transfer agent ? — A. Yes sir. Q. He had an office, didnt he ? — A. He had an office there. 170 TILFOED. Q. Eoom 1401, didnt he? — A. I suppose that is the number, four- teenth floor. 345 Q. You know he kept the books of transfer, dont you ? — -A. I presume he did. Q. Or kept the stock ledger? — A. I dont know about that. He kept the certificate book. Q. Were you ever in his office? — A. I may have been; I dont recall. Q. As one of the Liquidating Trustees and the attorney in fact for the Liquidating Trustees, did you employ him? — A. I did not. Q. '\'\rho did? — A. I dont know who did. I have no recollection of it, Mr. Kellogg. I would rather answer it that way, I have no recollection of having employed him. Q. Have you looked up to see if you could find those books since last Friday? — A. Yes, sir, I went to Mr. Flagler's office as you re- quested. I didnt know where else to go; and asked if there were any books of that nature there, and was told there was not. Q. Did you make any other inquiries? — A. I had already asked the assistant secretary of the New Jersey, and in the comptroller's office. Q. And what did he say ? — A. He said No. Q. What is your recollection as to how many years Mr. Bensinger was there? — A. I wouldnt like to make a guess. I cant remember things of that kind, with so many employes. A. Well, was it an unimportant detail, the dissolution of this 346 trust and its liquidation ? — A. Well, the carrying of it out was chiefly clerical. Q. It was ? — A. Yes sir. I had very little to do about it. Q. You had to take your stock to somebody to be transferred? — A. Yes. Q. Did you take it to Mr. Bensinger? — A. I dont remember. Q. Well, he was the regular employe assigned to that duty wasnt he? — A. I think so. Q. And 3'ou know enough about stock transfers to know that he kept a stock ledger, dont you ? — A. I presume he did, yes ; I presume he did. I dont remember of ever having seen it. Q. And you are unable to find that stock ledger or the transfer book at all ? — A. Yes sir, I am. Q. Did you make the contract with the Indianapolis Gas Company to supply them oil also? — A. I dont know. I dont think I had any- thing to do with it. That is, I dont know whether there is a contract. I will answer it that way : I dont know whether there is a contract with the Indianapolis Gas Company. Q. Did you look up to see if you could find the correspondence with Mr. Wall relative to the contract with the independent refin- ers? — A. I went to Mr. Payne's office, and he wasnt in, and I ha vent had an opportunity yet to see what I could do with reference to Mr. Barstow's office. Mr. Kellogg. That is all, Mr. Tilford. TILFORD. 171 Mr. MiLBTJRN. Have you got that stock list, Mr. Kellogg? Mr. Kellogg. What stock list? Mr. MiLBTJRN. The list ^ve furnished of all the stockholders of the New Jersey Company. 347 Mr. Kellogg. Yes, it is here. Mr. Mii^TJEN. Wont you mark it? Mr. ICellogg. I have iised all I want to of it at the present. I dont know as I want any more of it. You can have it marked, if you want to. The list was produced and handed to Mr. Milburn. Mr. MiLBUEN. I would like it to appear on the record that at the request of the counsel for the government a list of the shareholders of the Standard Oil Company of New Jersey under date of August 19, 1907, was prepared bj^ the company and submitted to them. Mr. Kellogg. That already appears, Mr. Milburn. Mr. MiLBUEx. Well, that they have examined Mr. Tilford with respect to certain of the material contained in that list and he has testified from that list. And therefore, I think that the entire list should be marked in evidence, as an exhibit in the case. Mr. Kellogg. Well, do you wish to offer it? Mr. Rosenthal. Do you refuse to offer it? Mr. Ivellogg. "When I get around to it, I may offer it. I am not ready yet. Mr. Rosenthal. Have you any intention of offering it? Mr. Kellogg. That I will answer when we get around to that point. If you want to offer it now, you can offer it. I am not through with it yet. 348 Mr. MhbtjRN. If the coimsel for the government says that he is not going to offer it or hasnt offered it, although he has used it, why, I will have to ask that it be marked as an exhibit. Mr. Kellogg. I dont say anything of the kind, Mr. Milburn. I ha vent had time to examine but a very small part of it. Mr. Milbuex. Then we will have it marked as an exhibit. Mr. Kellogg. All right; there is not the slightest objection to it. That is the exhibit of the Standard Oil Company of New Jersey. Mr. MiLBUEN. Marked Defendant Standard Oil Company of New Jersey Exhibit 1. Cross-examination by Mr. Milburn : Q. Mr. Tilford, the list, defendant Standard Oil Company of New Jersey, Exhibit 1, is the list from which you answered the questions put to you by Mr. Kellogg with respect to the stock ownership of certain individuals in the Standard Oil Company of New Jersey on the 19th day of August, 1907?— A. It is. Q. The information that you gfive was derived from that list?— A. Yes sir. Q. That you understand is a list of the stockholders ?— A. Yes, sir. Q. Have you any idea of the number of thousands of stock- 349 holders that there are from this list ?— A. I think there are over five thousand. 172 TILFOBD. Q. Over five thousand stockholders of the company ? — A. I think so. Q. Owning varying amounts of stock? — A. Yes sir. Q. Shortly after the dissolution of the so-called Trust in 1892, as I understand you, you surrendered the whole or a substantial part of your certificates and got an assignment of legal interest? — A. I sur- rendered some stock and got an assignment of legal interest, I remem- ber that. Q. Your assignment you took, and had the stocks of the separate companies issued to you ? — A. I did. Q. Those stocks 370U held for a number of years ? — A. I did. Q. Voted them at elections of the separate corporations, when you did vote? — A. Yes sir. Q. And in 1899 sold them to the Standard Oil Company of New Jersej' for shares of its common stock? — A. Yes sir. Q. And you know, do you not, that there were a number of other people who did just the same as you did? — A. I do. Q. You dont know how many people took out or surrendered their certificates, got liquidating assignments, and then did not convert them into the stocks of the separate com}Danies? — A. I do not. Q. During those years from 1892 on, was your occupation, in con- nection with the management of the affairs or part of the affairs of one or more of the separate companies ? — A. It was. 350 Q. That was your business ? — A. That was my business. Q. You spoke of being the president of the Standard Oil Company of Indiana for a certain period of time ? — A. Yes sir. Q. I think you say you were president at the time that a contract was made for the supply of oil with tlie — People's Gas Company, is it ? — A. I think that is the name. I think it is the name. Q. AVell, during the period that you were president of the Stand- ard Oil Company of Indiana, were you an active executive officer, or not? — A. I was not. Q. Wlio was its active executive officer? — A. Mr. James A. Moffatt. Q. And where were then and are now the head-quarters of that company A^lth respect to its business and its accounting departments and records and everything? — A. Chicago; or YvTiiting, Indiana; there may be some records there. Q. You spoke of certain exporters or exporting companies, that is, companies that exported oil; and the substance of your testunony was that the Standard Oil Company of New York was the principal exporting company, and you named some other exporting companies that were entirely independent of any relations or alliances with the Standard Oil companies. Do any of the so-called Standard refineries export directlj'? — A. Yes, the Atlantic Refining Company exports considerable of its oil directly. Q. Can you now name exporters, manufacturers of oil, who d^A export oil, entirely unconnected with your companies, in addi- tion to those you named the other day? — A. I think I only named the Gulf Refining Company. I have since recalled that there TILFORD. 173 are others independent of the Standard who export. There is Crew, Levick & Company of PhiLidelphia ; Pure Oil Company. Mr. Kellogg. You named those the other day. Q. Pure Oil Company was named the other day, but I think Mr. Kellogg mentioned it. Mr. Kellogg. He mentioned it. Witness. Union Petroleum Company, also of Philadelphia, and the Columbia Oil Company. Q. The Columl)ia Oil Company?— A. They have offices, I think, in New York, and a refinery in New Jersey. Also the Texas Oil Com- pany of Texas. Q. That you named before, didnt you ?— A. No, I named the Gulf Refining Company. Q. The Gulf Refining Company? — A. There is also a Texas Oil Compan3^ Q. That is another one? — A. Another one. Q. And are all of those concerns that you have now mentioned sub- stantially engaged in the exporting of oil? — A. Part of their busi- ness, I understand, is in the exporting of oil. Q. You were asked in regard to an arrangement or memorandum of an arrangement, which is Exhibit 15, annexed to the bill or 352 to the petition in this case. You can have it there. [Handing witness petition.] Do you recall being asked with reference to that arrangement ? — A. Yes sir. Q. Now, that was an arrangement Avith certain refining companies engaged in business in Pennsylvania unconnected with the Standard interests, so-called independent companies? — A. I am not sure whether all of them are located in Pennsylvania. Most of them were. Q. I think you identified the list on page 96 of the petition as those concerns. — A. They are all stated to be in Pennsylvania, I think, except one at Marietta, Ohio. Q. Now, they are the Pittsburg Oil Refining Company, A. D. Miller & Sons Company, Seneca Oil Works, Cornplanter Refining Company, Conewango Refining Company, Glade Oil Works, War- ren Refining Company, Emlenton Refining Company, Superior Oil Works, Levi Smith, Lake Carriers' Refining Company, Beaver Refining Company, Island Petroleum Company, Canfield Oil Com- pany, Sterling Oil Works, Tiona Oil Company. Prior to this time of the arrangement, had you been supplying them with crude oil?— A. I think so, Mr. Milburn, although I say now as I said then, while I believe this list to be correct, I do not absolutely remember them all. Q. Yes, you are not assuming to speak specifically as to each one of those companies ? — No sir. Q. But speaking generally of them, they were engaged in refining oil at the points mentioned? — A. Yes sir. Q. This arrangement (I think you gave the date of it) was 353 about 1903 ?— A. The last part of 1903. Q. Had they been dealing with the Standard or any of the Standard Oil companies prior to this time?— A. They had been. 174 TILFOED. Q. In what waj^ ?— A. Buying crude oil. Q. In what ? — A. In buying crude oil. Q. In buying crude oil. For a period of years? — A. Yes sir. Unless there is some new refinery here in the list that may not have been in business very long; I dont remember that. Q. AYe will take your answers as applying to the group, you know, of refineries, which may not necessarily mean that your answer is true of every one of them; but that is the fact, Mr. Tilford, is it not? — A. Substantially, yes sir. Q. '\'\Tiat field did the oil come from with which they were sup- plied? — It came from the field of Pennsylvania and West Virginia and possibly southern Ohio, and consisted of a grade of oil designated in the trade as " Pennsylvania oil." Q. Had you other customers for the crude? — A. We had. Q. ^Y■dH your own, or the demand of your own companies also a large demand for that crude ? — A. Yes sir. Q. Had the supply been decreasing for a period of years? — A. It had. Q. Of what is called the Pennsylvania oil from those fields ? — Yes sir. Q. Had the demand of this group of refiners been increasing all the time? — A. Yes, sir, very rapidly. 354 Q. Will you give me the figures that would show that? — A. We sold the refiners in this group, or substantially this group — anyway, wc sold refiners in western Pennsylvania, in round figures, 302,000 barrels of crude oil for the year 1896. That increased until we sold them 1,750,000 barrels in 1903, or nearty 600 per cent. Q. Let me get those figures. The first you gave was in 1896 ? — A. We sold the refineries in western Pennsylvania, known as independent refiners. Q. Well, that is practically this group, it may not be in number. — A. Probably this group, with any additions to it. I mean it may have been fewer than this number in 1896, but I dont remember that. Any additions to them that came in would be exceptional. Q. Their demand in 1890 that you supplied was how much? — A. In round numbers, 302,000 barrels. Q. 302,000 barrels?— A. Yes. Q. And in 1903 what was their demand which you supplied?— A. 1,750,000 barrels. Q. 1,750,000 barrels?— A. Yes sir. Q. Per year ? — A. That is for the year, yes, in both cases. Q. And had that increase from 300,000 barrels, in round figures, a year, in 1896, to 1,700,000 in 1903, been a gradually increasing quan- tity? — A. Yes, rather rapidly during the last few vears preceding 1903. 355 Q. And from, as I understand you, a declining field? — A. Yes sir. Q. Will you tell us any special characteristics of this Pennsylvania oil, this oil from these fields that was called Pennsylvania oil ? — A. I am not sufficiently versed in manufacturing to describe that. TILPORD. 175 Q. Well, in a general way. — A. It was a valuable oil, and everybody in the refining business liked to handle it. Q. Well, it was a superior crude oil ? — A. It was. Q. And a great demand for it? — A. Yes sir. Q. Can you say whether or not it is regarded as the finest crude oil there is? — A. I think it is. Q. Xow, you particij)ated in the making of this arrangement. Ex- hibit 15, in 1903?— A. Yes sir. Q. Your attention has been called to the fact that about this time they had been notified that their demand for the crude oil must be limited, something to that effect? — A. As I understand it, they had been notified that all of their increasing orders could not be filled. Q. Tliat their orders for A. Continually increased quantity could not be filled. Q. Could not be filled. Now, had you anything to do with that, with the giving them that notice ? — A. I think not ; I have no recol- lection of it. Q. Xow, Mr. Tilford, that was the first thing that was done, was it? — A. Yes sir. Q. Then, how came you into tlie matter? — A. Our oil region 356 agent arranged for a meeting with these refiners to see if some sort of an arrangement for selling them crude oil could be made. Q. And is that the meeting that you attended? — A. That is the meeting that I attended. Q. Where was that meeting held? — A. In Buffalo, New York. Q. And you went to Buffalo ? — A. I went to Buffalo. Q. And met these independent refiners? — A. I met a number of them. Q. I think they are organized in an association, are they not? — A. I have been so told by Mr. Wall, I think. Q. An association that has officials, has it not? — A. I think so; at least, I dont know so, but I think I have seen letter-heads having something of the kind. Q. So if they are combined in an association, that would be a com- bination of independent refiners, would it not ?— A. Yes sir, I suppose so. Q. Now, you went to attend that meeting called, of these men, to discuss that situation ?— A. Yes sir. Q. Was it out of that meeting that this arrangement grew ?— A. It was. Q. And this is the arrangement, so far as it is covered by the written memorandum, for the sale to the Standard of such of the oil that they make as they export, as they had to sell for export?— A. Yes sir. Q. Will you give me, Mr. Tilford, an idea of what, since 357 that time (1903 down to date), has been the total product from the crude supplied by you and the amount that has been sold to the Standard for export?— A. For the three years ending 176 TILPOBD. December 31, 1906, we sold those refiners in western Pennsylvania and Ohio a trifle over 4,600 barrels of crude oil a day, 365 days in the year, those particular refiners. Q. Yes, this group of refiners. — A. This group of refiners. Q. 4,500 barrels a day? — A. A trifle over 4,500 barrels per day, based on 365 days a year. Q. Of crude oil? — A. Of crude oil. They sold iis, during the same period, an average of 427 barrels per day. Q. Barrels per day? — A. Yes sir. Q. So that, under this arrangement, they sold to the Standard for export, a tenth of their product, about a tenth of their product, from the crude oil furnished them by the Standard ? — A. I wouldnt say a tenth of their product, because I dont know what their product was. They sold barrels of reflned oil, which was about one-tenth in quan- tity of the quantity of crude oil sold. Q. Very well, then, that corrects my question. They sold barrels of refined oil one-tenth of the quantity of the barrels of crude oil that the Standard had supplied ; that is so ? — A. Substantially. Q. And the rest of their product, as you understand, was 358 refined oil that they sold in the domestic market? — A. I sup- pose they did ; I dont know where they sold it. They sold it to somebody other than to our company. Q. So that for those three years, the amount of oil that has been sold to the Standard under this agreement has been about 425 bar- rels a day on an average? — A. 427, to be correct. Q. 427 barrels a day? — A. During the three years:. It has been less than that since. Q. Eh? — A. You asked me to bring it on down to a later date; I havent done it. Q. You gave it down to when, December 31, 1906? — A. I did. I can give it down to June 30, 1907. Q. Well, that will do where we have it to. It has been less since? — A. They have delivered us less oil since: we have sold them more crude oil since January 1, 1907, than we did during the three preced- ing years, but they have sold us very little refined oil ; hardly any. Q. Were the sales of crude oil to them, or the supply of crude oil to them, in 1907, greater than in 1906? — A. It was during the first six months of this year of which I looked up the figures. Q. How much were they? — A. We sold them during the first six months of this year 1,074,000 barrels of crude oil. Q. For the first si^ months of 1907?— A. We have. Q. And the total sales to them, the total supply to them in 1896 was 300,000 odd barrels? — A. Yes sir. 359 Q. You spoke of the prices of crude oil, of oil for export, and the making of the prices, and quoting the prices to the brokers. Mr. Tilford, does the Standard Oil Company of New York have anything to do with the making of any price for export oil ex- cept the price at which it will sell ? — A. That is the only thing it has to do with it that I know of. TILPORD. 177 Q. Or any price made by — I think the only other company is the Atlantic. Do you know of any price made by the Standard Oil Com- pany, any Standard Oil Company, any affiliated company, with re- spect to export oil, other than the price at which it will sell its prod- uct for export? — A. I know of none other. Q. So far as you know, others who export and sell can sell at that price or any other price? — A. They can. Q. Do you know of their having anything to do with its being made a price put up in any produce exchange, or anywhere else ? — A. I do not. Q. You spoke of some trouble with a company in Colorado, a com- petitive incident out there? — A. Yes sir. Q. Do you remember the name of the company now ? — A. I do. It was the Rocky Mountain Oil Company. Q. And when was that, about when did that occur? — A. About 1892, I believe, v Q. 1892?— A. I believe it was about that. Q. That is fifteen years ago? — A. Yes sir. 360 Q. And that was a conflict between that company and the Continental, was it, or what company? — A. It was a conflict with the Continental. They inaugurated competition there against everybody, I imagine. Q. Do you know about the circumstances of that ? — A. I do not. Q. You have testified to that ? — A. I know, yes, but you ask it with the Continental. There were other people in the oil business selling oil to the Continental, and indirectly it affected them, of course. Q. "Well, was that a fight you inaugurated, or it inaugurated, that is, the Rocky Mountain Oil Company? — A. It inaugurated. Q. Did you cut the prices, or did it cut the prices ? — A. My under- standing is that they cut them ; I cant tell you that of my own loiowl- edge. Q. I dont want to press you further than your knowledge goes and you tell me when I ask you if you havent a knowledge about it. — A. It is my impression that they did. Q. You did testify about it. There was a remark you made in your testimony, and you spoke afterwards about either modifying it or qualifying it; do you want to say anything about it? — A. No, I dont care to say anything about it. I just interjected that Mr. Kellogg saying he had no objection. I didnt intend it for testimony. Q. But you dont wish to modify or change it?— A. No, I don't care to change it. Q. One more matter : That was the purchase of the business 361 of a firm in Missouri; Scofield A. Scofield, Shurmer & Teagle, of Cleveland. Q. That was in Cleveland ?— A. Yes sir. Q. And when was that purchase made ?— A. I dont recall. Q. About ; can you give us any idea when ? — A. I can not. 32555—08 12 178 TILFORD. Q. Well, is it within ten years or A. I think it is within ten years. Q. I think you said you negotiated that purchase? — A. I did, in part. Q. In part. Mr. Tilford, tell us what the relations had been with respect to the purchase, prior to the purchase of that property, whether you were seeking to buy it or what the facts were so far as you know them. — A. We were not seeking to buy it. They had offered to sell out, I think, on several occasions during several pre- ceding years, at least on one or more occasion during several preced- ing years, and we had declined to buy. Q. What? — A. And we had declined to negotiate. Finally they came to us, this last time, and made a price which we deemed satis- factorj', and we made the transaction. Q. Now, during how many years had that concern offered or been seeking to sell their business to you? — A. I should say several years, but I dont remember how man3\ Q. Several years? — A. I should say so. Q. And had they, during that time, made propositions to you 362 to sell ? — A. They had made suggestions that we negotiate with them for the purpose of buying them out. We never got down, I think, to any close figures. Q. And you had declined to buy them out? — A. We declined. Q. And finally, was there a specific proposition made to you? — A. They came to see us and finally made some figures. Q. Now, during these years that this was going on, were your re- lations with them amicable? — A. I dont know what our relations were, Mr. Milburn ; I didnt come in contact with them. Q. You didnt come in contact with them ? — A. No sir. Q. Just one question : You gave the amount of crude oil that you had sold to this group of independent refiners in the first six months of 1907?— A. Yes sir. Q. Over a million barrels? — A. Yes sir. Q. Can you give me how much oil they have sold to you, refined oil? — A. They have sold us less than 13,000 barrels of export oil. Q. Less than 13,000 barrels for export, export oil ? — A. Yes sir. Q. In that same six months? — ^A. Yes sir. Eedirect examination, by Mr. Kellogg: Q. Mr. Tilford, you spoke about this Rocky Mountain Oil Com- pany which had this competitive struggle in Colorado in 1892? — A. Yes, sir. 363 Q. You have looked that up and found out that was the time that started in? — A. I found a memorandum that it was about 1892. Q. Now, that concern was an offshoot, you said, of the United Oil Company? — A. I said some of the stockholders in the United inau- gurated that refinery. There may have been different stockholders; a number were in both. TILFOKD. 179 Q. At that time you had a contract with the United to purchase all their refined oil?— A. Whether it was in the form of a contract or not, I do not now recall, but we were purchasing their oil, yes, sir. Q. And also of the Florence Oil & Refining Company ?— A. Yes sir. Q. And no other concern except yours was selling oil in those states which you mention ? — A. Not to any extent. Q. Not to any extent. So you had a clean field for marketing all of the oil in those states ? — A. Substantially. There may have been some few sales, Mr. Kellogg. Q. Now, when this independent Rocky Mountain Oil Company started up, that was in competition with you, wasnt it? — A. Yes sir. Q. And they proposed to market their own oil, didnt they?— A. Yes sir. Q. And you went after them and cut prices, did you not ? — A. We didnt inaugurate it, as I understand it, at all. 364 Q. Do you know that you didnt inaugurate it? — A. Not of my own Icaowledge, as I understood it at the time. Q. And you dont know that you didnt ?^A. I think Mr. H. M. Tilford can tell you. Q. All right, I will call him. Anyhow, the prices were cut, werent they? — A. Yes sir. Q. And then you cut their prices, didnt you, after they started in? — A. I am not sure of that. Q. Well, somebody cut prices and kept see-sawing down until they got down pretty low, didnt they? — A. My information at the time I can only tell you, and I got it in the general run of the business, was that whenever they cut prices at points below cost; we didnt follow at those points. Q. Yes, but you cut down to cost or pretty near cost ? — A. We did. Q. And when they got below cost, you didnt follow them? — A. That is my understanding. Q. That is your understanding? — A. Yes. Q. But you cant give the figures ? — A. I can not. Q. Now, how low did you get the price of oil down — ^refined oil — during that struggle ? — A. I couldnt give you the figures. Q. Well, you can give us something of an estimate, cant you? — A. No, I could not. You see I didnt follow those figures. Q. Well, it was lower than fifteen cents a gallon, wasnt it? — A. I have no doubt that Mr. H. M. Tilford can give it to you. Q. Then how do you know they got it down below cost? — 365 A. Because I was told so. Q. About what is cost ?— A. That I couldnt tell you. I was told it was below cost. Q. They sold it down below ten cents, didnt they?— A. I think it quite likely. Q. Sold it down below seven, didnt they?— A. I wouldnt like to answer, Mr. Kellogg; I dont know. 180 TILFOKD. Q. What do you think about it ? — A. I havent any recollection of where it went to. I heard, of course, currently, that they were mak- ing low prices there. Q. How long did you hear they were making them? — A. I dont remember the figures. Q. Well, about? give us your best recollection. — A. I couldnt give you that ; it is too many years ago. Q. You couldnt give us any idea how low oil did sell ? — A. I could not. Q. But during that struggle it sold very low? — A. Yes, I know that from my general knowledge of the business. Q. And as soon as that struggle was over, it went back again? — A. I cant tell you how much it went back. I understood, in a gen- eral way, that it went up, just as I understood it went down. Q. You put it up? — A. That I cant answer. What ? — A. I cant answer. 366 Q. Well, you were marketing all the oil, werent you? — ^A. Of course, we put it up, but what I mean is this : the refiners put oil up to us. They had reduced their oil to us, understand. Q. Certainly. — A. Then they put their oil up to us. Q. And you put it up to the public ? — A. Yes. Q. Now, what did you pay the Florence Oil Company during these last years for oil ? — A. I cant give you the figures. Q. And the United Refining Company? — A. I cant give you the figures. Q. Can you look it up ? — A. I will if there is any record here. It may be in Colorado, you know. Q. These companies report here, dont they, all of them ? — ^A. They make reports to Mr. H. M. Tilford. Q. And his office is 26 Broadway ? — A. Yes, sir, he is president of the company. Q. You can give us the figures from that office at what oil sold during that period and what it sells at now and has during the last two or three years, cant you ? — A. I dont know whether there is any in this office or not. Q. Isnt it a fact that in that territory where you sell all the oil, the average price that you sell it at is above 15 cents ? — A. I dont know. Mr. Rosenthal. You dont want to go by that chart ; it is mislead- ing. Mr. Kellogg. We will find out what the price was, if we can. 367 Ml-. Rosenthal. I just wanted to warn you, that is all. Q. And in places where there is competition you sell it as low as eight cents and even lower than that? — A. I am not familiar with those details. Q. You are not familiar with them ? — A. No sir. Q. You never heard that, I suppose, from any of your men out there? — A. Out in Colorado? TILFOBD. 181 Q. Yes. — A. No, I dont think I have heard anything from them, unless it is possibly some general talk by the Aace-president when he is here. Q. How long did this concern last? — A. I should judge from a memorandum in the office, it lasted two years, approximately. Q. Then failed ? — A. No, they didnt fail, I understand it. Q. Did you buy them out ? — A. No sir, they sold their — I can only tell you what memorandum I found, I dont know the facts myself, at all. Q. Yes. — A. There is a memorandum there that said they sold their producing business — they were producers as well as refiners — to the concern known as the Western Oil Company in which they and the United were stockholders. Q. Practically went over to the United? — A. Well, to themselves and the United. I dont know what became of the refinery. Q. You dont laiow what became of the plant ? — A. No that is pro- ducing territory proper. Q. Now, this Scofield, Shurmer & Teagle were pretty strong com- petitors of yours, werent they? — A. I heard so. 368 Q. And do you remember what you paid for that concern? — A. I do not. Q. You carried on the negotiations? — A. In part, yes. I was familiar at the time, but I dont now remember. Q. Cant give us any idea ? — A. No ; no idea at all. Q. They had two refineries, did they ? — A. I think they did. Q. One at Scio, and the other at Cleveland ? — A. I think so. Q. And you dismantled them both ? — A. I think we did at Cleve- land, because it was part of the agreement. Q. Did you dismantle the other? — A. We may have done so, but I dont recall. Q. Mr. Teagle went into your employ then? — A. Mr. Teagle, jr., yes. Q. Where is the older Mr. Teagle? — A. I dont know where he is. Q. Where are the other me'bers of the firm? — A. I dont know where they are. Q. Now, this Petroleum Refiners Association in western Pennsyl- vania that you have been testifying about sold you 427 barrels of re- fined oil per day ? — A. I didnt say that the association sold us that. Q. Well, this list that you A. Well, I think the Association embraced more refineries than those. 369 Q. Well, this list of refiners which you mentioned.— A. Yes. Q. And identified here, sold you 427 barrels on an average up to 1906 ?— A. Of export oil. Q. Of export oil?— A. Yes. Q. That is fifty gallons a barrel, isnt it?— A. Yes. Q. And your crude oil is 42 gallons?— A. 42 gallons. Q. Now, they sold you all they made for export, didnt they?— A. I do not know. 182 TILPOKD. Q. You dont know ? You didnt expect that they would export all their oil, did you ? — A. I did not. I thought they would export more than they did, though. Q. Now, you say during just shortly before making this contract you had reduced the amount that they were receiving? — ^A. We had reduced our sales to them, yes sir, compared with what we had been selling in that year, part of that year. Q. Then this arrangement was made ? — A. Yes sir. Q. By which you were to get their export oil. Now, previous to that time they had been selling some oil for export, you say, to Crew Levick & Company, hadnt they ? — ^A. I dont know whether they had or not. They had been selling export oil. Q. Wasnt that discussed at your meeting ? — A. If it was I have for- gotten it ; it is possible. Q. You hadnt been selling it for them, had you ? — A. No. Q. They had been selling it th'ough somebody ? — A. They had. Q. During the six months of the present year, you furnished 370 them, you say, a good deal more than you did before ? — ^A. We have. Q. That was since this suit was started, wasnt it? — A. I can tell you I didnt know they were doing it until I looked up these figures. Mr. MiLBURN. The suit didnt have anything to do with it. WiTOTESS. The suit had nothing to do with it. I was ignorant of the fact. Q. You were ignorant of the fact? — A. I was until I looked up the figures within the last two or three days. Q. It had no connection with this suit? — A. None whatever. Mr. MiLBTJEN. If the suit had smallpox, that operation wouldnt catch it. Mr. Kellogg. Well, it has not got it, Mr. Milburn. Q. This contract also contains an agreement that at your option you can buy all of their oil, their refined oil, does it not? — A. The export only, doesnt it? Q. Look at the top of page 270, where it says "Any oil which 'A' wishes to sell at the market price the date of shipment, ' S ' has the option of taking f. o. b. 'A's' refinery." — A. What page is that, please? Mr. Milburn. "top of 2T0. Witness. 270? Q. Yes. " On such oils, ' S ' will pay 'A' the same net price 371 as if shipped to Constable Hook or Philadelphia, but ' S ' will pay the freight from the refinery to destination, 'A' guarantee- ing at destination quality and quantity." — A. That refers to export oil only, but we have Q. It doesnt say so, does it? — A. It refers to export oil, but I can explain that to you if you wish. Q. Well, explain it. — A. It referred to export oil, but we had the option of taking any oil which they wished to sell for export and using it in this country if we chose, instead of exporting it. TILFORD. 183 Q. Oh, you didnt have to export it? — A. No sir, we were not obliged to export it ; we could use it. Q. Doesnt that refer to any oil they manufacture, just as it says?— A. No sir. Q. It doesnt say anything about export oil, does it? — A. The pre- ceding part of the memorandum would have that import. Q. Well, they got their crude from you, and they were compelled to sell their export oil to you ; that is true, isnt it?— A. It is true they promised to do it. If you will refer to the next page back of that, you will see it begins by setting forth what refined oil of any grade that "A" desires to export. Q. Now, Mr. Tilford, you mentioned the other day, when I asked you, certain concerns that were exporting oil, and one of them was the Pure Oil Company, which is connected with the United States Pipe Line. — A. Yes sir. 372 Q. I asked you about that at the time, didnt I? — A. I dont think so. ' Q. You dont think so? — A. I dont remember that you did. Mr. MiLBTORN. I recollect something being said about the Pure Oil Company. Q. Well, the Pure Oil Company is connected with the United States Pipe Line Company, isnt it? — A. I understand that it is. Q. And the Standard Oil Company owns 383,000 out of 1,190,000 of the par value of the stock of the United States Pipe Line ? — A. It owns some of the stock. I assume those figures are correct, if you say they are. I dont remember them at all. Q. Yes sir, and tried to get control of the company, did you? — A. Not that I ever heard of. Q. Never heard of that? — A. No sir. Q. Never heard of the fight with the United States Company whereby the Standard tried to get control of it ? — A. I never knew it tried to get control of it. I dont know about the fight you speak of. I never knew it tried to get control of the United States Company. Q. Do you know it didnt? — A. If I had to say one or the other, I would say it didnt. Q. That is not the question I asked you. — A. I have no knowledge either way. 373 Q. Well, it does own this ptock? — A. It does own some stock. Mr. MiLBURN. How much? Witness. I dont recall. Mr. MiLBUEN. Or what proportion ? Witness. I dont remember. Mr. ICellogg. 31 or 32 per cent. Mr. MiLBTJEN. 30 per cent. Q. How much does the Gulf Refining export?— A. I do not know. Q. Crew, Levick & Co. is an export commission house, is it?— A. They also have, I think, a refinery. ^ Q. Where?— A. Philadelphia. I think. 184 TILFORD. Q. Do you know how much they export? — A. I do not. Q. The Union Petroleum Company, how much do they export? — A. I dont know. Q. Are they an exporting company? — A. They are, and also have an interest, or control a refinery at Wellsville, New York. Q. The Columbia Oil Company, do you know how much they ex- port? — A. I do not; they have a refinery. Q. Where? — A. Down in New Jersey, not far from here. Q. The Texas Oil Company, do you know anything about it? — ^A. I dont know how much they export; I only know of the company, and I understand they export oil. Q. Wliere did you get your information about this since last Fri- day? — A. From Mr. Donald. 374 Q. Does he know how much? — A. I dont know. Mr. MiiJiURN. Well, he told me walking down that there were others that he had forgotten to mention. Witness. I knew some of them, anyway, Mr. Kellogg; they had simply slipped my mind when you were talking to me. Q. Do you know whether Crew, Levick, the Union Petroleum, or these others export to Europe or to South America? — A. Well, I could not tell you of my own knowledge. I think they export to Europe ; to Europe as well as to South America, if thej' do to South America ; I dont know about that. Q. You said something about the price being furnished to the Exchange this morning; I didnt catch that exactly. — A. I said we furnished our export price to our brokers, and had nothing to do, so far as I knew, with what the price was on the Exchange. Q. Well, on Friday you testified, as I understood you, that the price you furnished to your brokers was the price the Exchange quoted. — A. They may do it, but we have nothing to do with it that I know of. Q. Dont yon know that the fact is that the prices you make and fur- nish to the brokers is the export price in New York? — A. It is our price ; if others choose to adopt it, of course we have nothing to say about it. Q. Well, isn't it the price that is adopted by everybody? — A. I cant answer that except by inference. ?)75 Q. Well, answer it by inference. — A. I cant answer it by knowledge, because I dont know. Q. You dont know? — A. I do not. Q. You dont know that any different price is that than you make from day to day? — A. I have heard there were higher prices made. Q. You have heard that? — A. I have. Some of these refiners I have heard say they paid too high, prices for their oil to go to Eu- rope. Mr. Kellogg. I think that is all. Mr. MiLBURN. That is all, Mr. Tilford. (Signed) Wesley H. Tilford. BBNSINGER. 185 376 John Bensingek, called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct examination by Mr. Kellogg : Q. What is your full name? — A. John Bensinger. Q. Were you ever in the employ of the Standard Oil Liquidating Trustees ? — A. Yes sir. Q. How long?— A. "Why, I don't know exactly how long. Q. Did you commence in 1892, or about that time?— A. I think I began when they began. Q. You think you began with the Liquidating Trustees? — A. I think so. Q. How long did you stay with them?— A. I think until January, 1900. Q. Are you in their employ now ? — A. No sir. Q. You left at that time? — A. January, 1900, yes; it may have been 1901. Q. What was your position? — A. Why, I considered myself the transfer clerk. Q. The transfer clerk? — A. Yes sir. Q. Did you know Mr. Wesley H. Tilford?— A. I did. Q. Did you see him frequently ? — A. Why, yes, quite frequently. Q. He was one of the liquidating trustees ? — A. As I remember yes sir. Q. A little louder ; I cant hear you. — A. Yes, I remember it. 377 Q. Now will you explain as transfer clerk or agent (what- ever you call it) of the Liquidating Trustees, what books you kept? — A. The regular set of stock books. Q. Did you see at that time the stock books of the Trustees? — A. The stock books of the trustees ? Q. Yes, showing the number of trust certificates which they had issued and outstanding. — A. Well, that covers the regular ledger, you mean? Q. Yes. — A. Yes sir. Q. That is, the Trustees, prior to the Liquidating Trust, had a reg- ular stock ledger, did they ? — A. Yes sir. Q. A stock certificate book, showing the stock certificates outstand- ing, issued by the Trustees? — A. Stock certificate book? You mean the books from which the certificates were issued ? Q. Yes.-— A. Oh, yes. Q. Now, that ledger showed the total number of certificates out- standing, and to whom issued ? — A. It did. Q. And showed the condition, that is, showed that condition at the time the Liquidating Trustees took hold ? — A. Why, it must have, yes. Q. Do you remember whether you inaugurated a new set of books, or what you did do ? — A. No, I don't remember whether I continued the old books or whether I started a new ledger. I dont remember that. Q. Did you keep a set of books showing the liquidation? — A. Why, I presume so. 186 BENSINGEE. 378 Q. Well, what is your recollection? — A. I cant say posi- tively whether I kept — you mean a separate set of books ? Q. No, whether you kept books right along. — A. Yes, I kept books right along. Q. Now just what did those books show? Explain. — A. Well, they showed the number of shares of stock that were issued, to whom they were issued, and to whom dividends should be paid. That is all I kept them for. Q. During the liquidating period they showed, did they, from time to time, the number of assignments made by the Liquidating Trus- tees? — A. You mean the change of stock from the Trust stock to the assigmnent of legal title? Q. Yes sir. — A. Why, I should say yes. Q. They showed to whom assignments were made? — A. I should say yes. Q. Now when a holder of Trust certificates which had been issued by the Trustees of the Standard Oil Trust, brought in his certificates and asked for an assignment, what did you do? — A. To the best of my recollection there was not anybody come in and asked for any- thing special. They simply brought in a certificate, and in the regu- lar course of events the old certificate was cancelled and the new one issued. Q. That is, what issued? Assignment of legal title? — A. Assign- ment of legal title, yes. Q. Now, that assignment of legal title was an assignment of 379 a pro rata share of all the stocks of the twenty sub companies, wasnt it? — A. I presume so. I cant say positively. Mr. MiLBtrEN. Isnt that admitted ? That is in the record and ad- mitted. Mr. Kellogg. I am trying to get at what books he had. Witness. I presume so, sir. I dont believe I ever read what the certificate said. Q. Well, you entered in your book, did you, the name of the party presenting the certificates and what assignments were issued? — A. The certificate that came in was cancelled, and a debit placed to the accoimt from which it was taken; and if it was a new person that took the new certificate there was a new account opened. Q. Now, the stock ledger would show who received the assignment of interest in the subcompanies and the amount he received wouldnt it ? — A. I don't think so ; the ledger would not show that, no sir. Q. What would show it? — A. I don't know as tlaere was anything that would show it. Q. Wasnt there a journal? — A. No, that wouldnt show it either. The journal was simply a step from the certificate book to the ledger at that time. Q. Well, what did the journal show, Mr. Bensinger ? — A. Why, just the date of the certificate that was cancelled, the number of the cer- tificate and in whose name it stood. BBNSINGEE. 187 380 Q. That is it. — A. And then on the opposite side the new certificate number, same date as the cancellation, and to whom the new certificate was issued. Q. That is just what I asked you. Then, it would show to whom the assignment was made? — A. Yes, but not of the subcompanies. This was simply one certificate. Q. I understand. But the assignment of interest in the subcom- panies would show to whom it was made ? — A. Oh, yes. Q. That is what I ask. So that if the assignment was in the form of the one admitted here, which I show you [handing witness a copy of the petition] , all assignments were made of an equal part in all of the subcompanies? — A. If this is correct, yes sir. I never read that. I never bothered reading what was on the certificate. Q. Then, your books would show the name of the person who sur- rendered the Trustees certificate, the name of the person to whom the assignment was made, and the amount or part, fraction, of the total stocks in the subcompanies which was assigned to it? — A. Yes sir. Q. And such books you kept? — A. I did. Q. During all the time of the liquidation ? — A. Yes sir. Q. And those books, what became of them ? — A. I dont know. Q. Did you leave them there ? — A. I left them there, yes. Q. What room did you occupy ? — A. I was in room 1401. Q. During all the time? — A. No, I dont think so; I think 381 my office was moved at one time from the eighth floor to the fourteenth, but I dont remember when. Q. 26 Broadway? — A. Oh, yes, 26 Broadway. Q. Now, did you have any assistants ? — A. I had one assistant, yes. Q. Do you remember his name ? — A. I had more than that up to a certain time. Q. Do you remember his name? — A. About the only one I re- member was a man by the name of Steadman. Q. Do you remember his first name? — A. F. B. Q. F. B. Steadman?— A. Yes. ■ Q. Do you know whether he is still employed by the Standard Oil Company? — A. I do not. Q. You were the attorney in fact also of the transferees, were you not? — A. I think I acted for both sides, I am not sure. Q. And you procured from the subcompanies all stocks to be de- livered to the holders of assignments, did you not?— A. I, directly? Q. Yes sir. — A. No sir. Q. Well, they were procured by you in some way, were they not?— A. They were procured through another office — the comptroller's office. Q. And delivered to you?— A. And delivered to me. Q. And you delivered them to the parties holding the assign- ments? — A. Yes. Q. Where did you leave the books when you left?— A. Where did I leave them? 188 BENSINGEK. 382 Q. Yes sir. — A. In the safe, I guess. Q. In the safe ? — A. Yes sir. Q. In the office of the Standard Oil Trustees ? — ^A. In the Transfer office. Q. In the transfer office ? — A. Yes sir. Q. At 26 Broadway? — A. Yes sir. Q. Have you ever seen them since? — A. Yes sir. Q. What became of the Trust certificates as they were turned in ? — A. The cancelled certificates? Q. Yes sir. — A. Pasted back on the stubs, the stub of issue. Q. The stub of issue? In the stock certificate books? — A. In the stock certificate books. Q. And that book was there when you left ? — A. Oh, I guess there were fifty or sixty of them. Q. Yes. — A. As they run along from one to Q. Were they there when you left? — A. Yes sir. Q. During all the years you were there you preserved these books?— A. I did. Q. Now, did you perform any other duties except that of transfer agent, say from 1892 to 1897?— A. No, I dont think I did. Q. You don't think you did ? — A. No, nothing except what was in line with the office. I occasionally sent a telegram, or something of that kind. Q. You performed no duties in any of the other offices? — A. No. 383 Q. Have j^ou any recollection of the number of shares of Trust certificates which were cancelled from 1892 to 1907? — A. No, I have not. Q. You havent any recollection? All of them were not can- celled ? — A. Wliy, no ; I should say off-handed that they were not all cancelled until the final wind-up. Q. You mean by the " final wind-up," when everything was turned over to the Standard Oil Company of New Jersey? — A. Yes. It would have been possible to have cancelled them all at any one time. Q. As a matter of fact most of them that were cancelled were can- celled in 1892, were they not? — A. That I dont remember. Q. You dont remember? — A. No. Q. These books would show ? — A. The books would show, yes. Q. And the books would show the process of cancelling these cer- tificates? — A. I should say so, yes sir. Q. And liquidation? — A. Yes sir. Cross-examination by Mr. Rosenthal : Q. What year did you leave?— A. I think in 1900 or 1901. Q. And have had no connection since then with the Standard Oil Company of New Jerse}' ? — A. None whatever. Q. What is your business now? — A. Stock-broker. 384 Mr. Kellogg. Now, Mr. Milburn, those accounts that they are examining not being ready, we will have to go on with something else. WABEEN. 189 Mr. MiLBURN. Just as soon as you adjourn, I will go right down there. Mr. Rosenthal. Let us adjourn now. It is 12:30. Mr. Kellogg. Mr. Milburn is going to give the instructions about the making up of these accounts, and I suggest that we adjourn until 2 o'clock. The Examinee. The hearing will stand adjourned until 2 o'clock. 385 Afternoon Session. Benjamin Franklin Warren, called as a witness on behalf of Petitioner, being duly sworn, testified as follows: Direct examination by Mr. Morrison : Q. What is your name? — A. Warren— Benjamin Franklin. Q. Benjamin Franklin Warren? — A. Yes, sir. Q. Where do you live, Mr. Warren ? — A. In Brooklyn. Q. What is your occupation ? — A. Civil engineer. Q. In whose employ are you ? — ^A. Tidewater Pipe Company. Q. How long have you been in the employ of that company ? — A. Since its organization in 1878. Q. Is it a corporation or a limited partnership? — A. A limited partnership. Q. Under the laws of Pennsylvania, is it ? — A. Pennsylvania. Q. Who were the organizers? — A. Mr. B. D. Benson, Eobert E. Hopkins, David McKelvy, H. L. Taylor, A. A. Sumner, and a num- ber of others whose names I do not recall at present. Q. Did you have anything to do with the laying out and construc- tion of the Tidewater Pipe Line ? — A. I had charge of the work. Q. Where is that line? What is its beginning and end, with the terminals ? — A. It begins at Eixford, a small town near Brad- 386 ford, in McKean County, Pennsylvania. It extends thence through McKean County, Potter County, Lycoming County, Schuylkill County, Carbon County, and on the Delaware River, where it crosses into New Jersey, and across New Jersey to Constable Hook, near New York. Q. Who laid out that line? — A. I did, and secured the rights-of- way. Q. Did you have also to do with the construction of it? — A. In a general way. Q. Did it originally extend clear to the tidewater? — A. The first section terminated at Williamsport. Q. When was it extended from Williamsport to Constable Hook ? — A. It was completed, I think, about 1886. Q. Has it some gathering lines ? — A. In the region, yes, in the oil region. Q. In western Pennsylvania? — A. In the western Pennsylvania oil region, sir. 190 WAEREHr. Q. You say you had to do with the laying out of this line and the construction of it. I will ask you whether or not you acted in any secrecy about the original laying out of the plan. — A. Yes, sir. Q. What was your reason for that ? Mr. Rosenthal. We object to that on the ground that his rea- sons do not make evidence against the Standard Oil Company nor any of the codefendants in this case. Q. You may answer the question. — A. For fear of opposition. 387 Q. Well, from what concerns? — A. We couldnt tell what concerns it might be. The railroads were opposed to us, we knew that. Q. Did you have any fears of the Standard Oil Company people ? — A. Yes. Q. Did you have any trouble in getting your survey through? — A. Not the survey, no. Q. Was it known publicly that you were making a survey for this line wliile you were making it? — A. It probably was, because we went to the farmers, the owners of the land, to secure rights-of-way for the pipe line. Q. Did you have any trouble in securing a right-of-way? — A. Some. Q. You may go on and state what it was, commencing at the be- ginning. — A. Well, we met opposition. A number of people were influenced not to give us rights-of-way ; by whom I dont know. Q. Just tell what actually occurred. — A. Oh ! After we had made the preliminary survey and began the construction of the line, there were two or three men appeared at Coudersport, Pennsylvania, and a couple more at Williamsport on the then eastern terminus, or com- bination points. Q. What was their osteijsible business? — A. The men on the west- ern end professed to be out there on a hunting expedition and made a lot of inquiries about the line and where the line was located. 388 Mr. EosENTHAL. What was the date of that ? Witness. That was in 1878, about the first of January, 1879. Mr. Rosenthal. We object to that further upon the ground of its remoteness, and again upon the ground that it does not appear to be in any wise connected with the act or conduct of any one of the de- fendants named in this bill, and upon the broad ground stated by Mr. Milburn last week, that it ante-dates the passage of the Sherman Anti-Trust Act. Witness. The men on the western terminus of the line I am speaking of found a place where our line crossed. We had a right-of- way from a land owner near Coudersport, and our right-of-way had not been recorded but had been taken more than six months previous ; under the Pennsylvania law we were allowed six months to record our deeds. They bought the property, but before they bought it, while they were negotiating, I put the right-of-way on record. WAHEEN. 191 Q. But they finally bought it? — A. They bought it, yes; they bought it the next day after I put it on record. Q. After they discovered that you had put your right-of-way con- tract on record, what next was done? — A. An adjoining farm which was in an estate in which there was a minor heir, we had secured a right of way from; they had a guardian appointed for that minor and they bought that property. Q. What did you do about that ? — A. They never took any further action on that. Then another adjoining property which 389 we had just recently acquired the right-of-way from, they bought that property and ante-dated the deed and put that on record, put the date of the deed prior to our right-of-way. We were then advised by counsel and arrested them. Q. You had them arrested for that, did you? — A. We had them arrested and brought suit against them. Q. What was the result of that suit ? — A. The result of that suit, a Mr. Dorrance Mr. Geeee. If your Honor please, I want to object to this on the ground there is no allegation in the bill that authorizes such testi- mony as this. Q. Go on. — A. Attorney for the Pennsylvania Railroad appeared there and arranged their bail, which was $200,000. We also brought suit against these men criminally for the forging of that deed, for the ante-dating of that deed. The suit was compromised, it never came to trial. They gave us a right-of-way over the lands they had acquired in that section. Q. Where was this suit commenced? — A. I cant answer that. Q. In some county in Pennsylvania? — A. I think it was in Potter County. Q. Were there two suits? — A. A civil and criminal, yes. Q. Neither of them, as I understand you, was tried? — A. Neither was tried. Q. And you finally got your right-of-way across that property? — A. Yes sir. Q. You spoke about ante-dating a deed ; I suppose you mean 390 by that that it was dated back? — A. Dated back, yes; dated back prior to our right-of-way. Q. Well, what next occurred?— A. The next trouble we had was near Williamsport, where we crossed the Northern Central Eailroad. Q. What took place there ?— A. We laid our pipes under the rail- road, where the railroad had simply an easement, no fee of the land. Mr. EosENTHAL. Where was that? Witness. Just near Williamsport, Pennsylvania. Mr. Rosenthal. Pennsylvania road? Witness. The Northern Central road, a branch of the Pennsylva- nia. The railroad sent an engine with a lot of men there, put chains on our pipe and pulled it out. Mr. Rosenthal. Well, I object to that, because the Pennsylvania Railroad or the Northern Central Railroad is not a party to this bill. 192 WABREN. Mr. Morrison. We will connect them up before we get through. We can not prove our entire case at once. If we dont, it wont be competent. Mr. Rosenthal. I suggest the proper method of proceeding would be to make the connection first. Mr. Morrison. Well, we shall have to Judge of that, Mr. Rosenthal. Q. Go right on. — A. The men with the engine pulled our 391 pipe up and left it lying along side of the track. We sent them back there and put it under again, and immediately ap- plied for an injunction to restrain them from removing it. That in- junction was granted and made permanent eventually. Q. Did you get your pipe under ? — A. We got our pipe under and it stayed there the second time. Q. What next occurred? — A. We met a lot of minor obstructions that I cant recall now, but nothing serious until after we had started to come east from Willi amsport. Q. What occurred then ? — A. I found Just about fifteen or twenty miles east of Williamsport a line of rights-of-way, exclusive rights- of-way, which cut off our proposed line. The line extended for over forty miles, nearly at right angles with our proposed line and I hunted along that line until I found a defective title, some ten miles to the north of where I had intended to cross. I secured a right-of- way on that property; and these people immediately bought the property and put some thirty men up there, ostensibly as woodchop- pers, and they had shot-guns and arms, and threatened to shoot us if we ever attempted to put a pipe across there. They didnt bother us much after that until after I got the line completed, except that one particular section, that is, the right of way. When I speak of the line I mean right-of-way. They didnt bother us much until I went back on that line and found a point along on Muncie Creek, where the original warrants didnt come together ; that is, those 392 on the south of the creek had stopped on the south side, and those on the north side had stopped on the north side. And I bought a strip of land surrounding that vacant property — that vacant land. I then applied at Harrisburg for a warrant for that vacant land. I got it, and that gave us a right-of-way through there, ex- clusive right of line. Q. Now, how much of a tract of land do you say they had pur- chased across your contemplated line? — A. They hadnt purchased the land. They had taken an exclusive right-of-way for about forty miles. They had taken a double line of properties, and we had taken through several of those exclusive rights-of-way on our previous work back of Williamsport, and to make secure, they had taken a double line. Q. What do you mean by a double line? — A. Taken a string of farms running north and south, and then the adjoining farms to the east of them, so that if one title was imperfect we would run up against another property that would probably be perfect. WARBEN. 193 Q. And you got through there, as I understand you, by buying up this strip of land between the two which hadnt been taken by the conveyances of the proprietors?— A. The title remained in the state. Q. The title remained in the state? — A. Yes. Q. Did you have any litigation over that title that you got?— A. Yes we had opposition at Harrisburg, which was con- 393 ducted by the Pennsylvania Eailroad attorney at Harrisburg. Q. Mr. Dorrance?— A. No, Mr. Olmstead. Q. Well, did you have any other similar troubles?— A. Yes, we had opposition all the way to the seaboard. I ran a line down to Chester, Pennsylvania, Avhich we never built. On tliat line we had a great deal of just general opposition, people going around there and trying to prevent people from giving us right-of-way; and also there were three or four of those exclusive rights-of-way across our to* line there, but as we never built the line it never came to any issue. Q. Why didnt you build the line ?— A. Because we found that the New York line would be sufficient, and we abandoned the Philadel- phia refinery. Q. Was that on account of the fact that they had purchased this land across your right of way? — A. No. Q. Did you have any trouble further back? Did they make any effort, after you had acquired your right of way, at any point, to get the title away from you ? — A. Only those that I have mentioned. Q. Was there an instance in which they bought land that belonged to the state?— A. Oh, yes. Q. What was there about that? — ^A. That was right after the line was completed. Q. Tell us about that. — A. They went back in Clinton and 394 Lycoming counties and found a vacant space there where the warrants didnt come together by about half a mile. They bought that vacant land from the owners; I think it was Phelps, Dodge & Co. who were the owners (I am not quite sure about that). Then they went to Harrisburg and applied for a patent or a warrant for that vacant land on which our pipe was located. I went to Harris- burg, with our attorney, and made no objection to the granting of the patent, except in so far as it affected a strip a rod wide on which our pipe was laid, and asked for a warrant for that. Q. On the ground that j^ou were the occupant? — A. The actual occupant, which under the law gave us the first right. Q. Well, what was the result of that? — A. Well, I believe they got their patent, but nother further came from it. Q. Did you maintain your line through there? — A. We main- tained our line through there, yes. Q. Was there any litigation over that? — A. No, sir, none except the opposition there to the granting of the application for the war- rant before the Land Commissioner. Q. You had a hearing, did you? — A. Had a hearing before the Land Commissioners. 32555—08 13 194 WABEEN. Q. Before the Land Commissioners? — A. Yes. Q. When was that? — A. It must hare been in about 1881. Q. Was your pipe at that time extended through to Wil- 396 liamsport? — A. Yes; it liad been operating. Q. And was in operation? — A. And in operation, and we were then extending it through to the seaboard. Q. Were you compelled, anywhere along that line, to make detours, to survey land in order to overcome any of these obstructions you have been telling us about? — A. Nothing of any importance. We managed to get through very nearly where we intended to get through. Q. Have you told us now of all the opposition that you encountered in getting your line through to the seaboard? — A. All that I can recall. Q. You have told us everything east of Williamsport ? — A. Yes. When I got that patent or warrant, that seemed to end the main part of the opposition. We had comparatively little opposition after that case was settled. Q. "When did you get your line through to Williamsport? — A. In May of 1879 we began pumping oil. Q. Did you have any connections there so that you could get oil to the seaboard ? — A. Yes, sir, we had an arrangement with the Reading Railroad by which they took our oil from Williamsport to the sea- board and pro-rated the cost, the charges. Q. How long before you got your line to Constable Hook? — A. I think about 1886. Q. When did you commence the extension from Williamsport to Constable Hook?— A. I think in 1881. 396 Q. It was finished to come to Constable Hook in 1886, wasnt it? — A. I think it was. Q. And Williamsport what time? — A. In 1879. Q. Mr. Warren, do you remember the time when there was a meet- ing of the stockholders or owners of this Tidewater Pipe Company, and at which a minority sought to control the meeting and elect officers ?— A. Yes sir. Q. You remember that? — A. I remember that. Q. Where were you at the time? — A. I was in New York at the time. Q. Where did you have offices? — A. 115 Broadway. Q. At what other places did this Tidewater Company have of- fices ? — A. They had offices in Philadelphia, Williamsport, Bradford, the same instructions were issued to all the offices. Q. You were not present at that meeting, were you? — A. No sir. Q. Wliere were you when the meeting was held? — A. At New York. Q. Did you shortly after that do anything in the way of barri- cading the entrances to those offices ? — A. I hardly call it barricading. Instructions were sent out from the Titusville office to maintain some- body in the offices day and night. There were two of us who were BENSON. 195 delegated for that purpose: a Mr. Allen, now dead, and myself; either he or I remained in the oifice day and night for about ten days. 397 Q. For what purpose? — A. For the purpose of preventing somebody else coming in and taking possession of the office. Q. Do you know anything about the other offices? — A. Only that the same instructions were issued to all the offices (No cross-examination.) (Signed) Benjamin Franklin Warren. 398 Robert D. Benson, called as a witness by Petitioner, being duly sworn, testified as follows: Direct examination by Mr. Morrison : Q. What is your name ? — A. Robert D. Benson. Q. Where do you live? — A. Passaic, New Jersey. Q. What is your business ? — A. I am a manager, that is, a director, and also the secretary of the Tidewater Pipe Company, Limited. Q. Have you anything to do with the Tidewater Oil Company ? — A. I am vice president of the Tidewater Oil Company. Q. How long have you been connected with the Tidewater Pipe Company, Limited? — A. Officially since 1888, when I was first elected a manager on the death of my father. Q. Was your father connected with that same company? — A. He was the first president of the company. Q. He was one of the organizers of the company, was he not ? — A. Yes sir. Q. In what business is this Tidewater Pipe Company, Limited, engaged? — A. It is engaged in the business of collecting and trans- porting crude oil. Q. In what business is the Tidewater Oil Company engaged ? — A. It is engaged in the business of refining the crude oil collected by the Pipe Company. 399 Q. By what pipe line? — A. By the Tidewater Pipe Line. Q. You are the present secretary, I think you say, of this company? — A. Yes sir. Q. Have you the books of your company which show the rec- ord of the meetings of the stockholders and managers of that com- pany? — A. I have. Q. You have them here now, have you ? — A. Yes sir. Q. Do you remember the time, Mr. Benson, when, at a meeting of the stockholders of the Tidewater Pipe Company, Limited, there was an effort made on the part of the minority to control that meet- ing and elect officers? — A. Yes sir. Q. Where were you at that time? — A. I was in New York with my father. Q. With your father ?— A. Yes. Q. When did you first learn of it? — A. We learned of it the afternoon of the day of the alleged meeting, by a telegram from Titusville. 196 BENSON. Q. How long after the meeting was held? — A. Oh, I think only an hour or two, perhaps only a few minutes. We had a direct line of telegraph between our office at Titusville and here. Q. Can you tell who the members of the company were at that time? Mr. Rosenthal. AYere you present at that meeting? Witness. No sir. Mr. EoSENTHAL. We object to that on the ground that he 400 has no personal knowledge. Mr. MoKRiiSON. I am not asking him anything about what took place yet. Mr. Rosenthal. No, but your question assumes the gist of what took place. Q. Did you say that you could give the names of the stockholders at the time of that meeting? — A. I think the records would show it. I could only give it by referring to the record books. Q. You may take those i-ecord books, Mr. Benson, and give us those names. Mr. Rosenthal. Yfas that record kept by you, ilr. Benson. Witness. No, sir. Mr. Rosenthal. Y^ell, I object to it upon the ground that he has no personal knowledge of the minutes, and that the minutes of the Tidewater Companj' are not records within the meaning of the law. (Two books were handed to the witness.) Q. Yvliich is the book that is earliest in point of time? — A. The book marked Number 2 here. Q. What is book number '2 that you now have in your hands? — ■ A. It is the official minute book of the company, containing the records of the members' meetings, and also of the managers' or di- rectors' meetings. Q. Where is that book. kept? — A. It is kept at present in the office of the company at 11 Broadway, New Y'ork. 401 Q. Yliere were the offices of this company formerly? — A. The principal office according to law is in Titusville, Pennsyl- vania, but the minute-books are kept here for convenience, as the managers' meetings are usually held in New York. Q. How long have they been kept here? — A. I cant say, but I should think since about 1900. That is, the old minute-books have been kept in this office. The current one was kept here for some time prior to that. Q. Those books have been kept in yonr custody, have they, as the secietiiry of that company? — .V. Since I was secretary. Q. AYhr.t do they contain? — \. They contain the minutes of the members' meetings (that is the way we call our stockholders), and also the nianiigers' meetings, wliicli is the same as directors, as usually uiKici'slood in a stock corporation. Q,. Have you any I'ecord there that shows what took place at the meeliup; that we lia^e been talking about? — A. There is a record here whicli is sealed. I have never, to my knowledge, seen what it contains. BENSON. 197 Q. Turn to it in the book and tell me where it is ? — A. It begins at page 30 and extends to page 46. Q. I will now ask you to unseal that and read to the Examiner the minutes of that meeting. Mr. Rosenthal. I renew the objection, of course, on the 402 ground that there is no evidence tending to prove the verity of those minutes, and on the further ground that the minutes of the Tidewater Company are not evidence against any defendant named in this case, except, of course, the Tidewater Company. Mr. MoKRisoN. The Tidewater Company is a defendant. Q. Do you know when this book was sealed up, or when those pages were sealed up ? — A. My only knowledge comes from the record of the book next to this, in which they are ordered to be sealed by the members. I presume it immediately follows the passing of that resolution. Q. That is the last record of any meeting, then, in that book? — A. Yes, sir. Q. You may describe how that is sealed up. — A. Well, sir, I will show you. Staples driven through all the pages that contain the record of the meeting. Q. Metal staples? — A. Metal staples. (The witness, with the assistance of Mr. Lewis, removes the staples which fastened the pages together.) Mr. Geeer. What is the date of that meeting, please ? Witness. January 17, 1883. Mr. MiLBUEN. Oh, dear ! Mr. Rosenthal. What is the date ? Witness. January 17, 1883. Mr. Rosenthal. Well, we object to that upon the ground 403 that it was 24 years ago ; too remote. Mr. Greer. And the same is barred by the statute of limitations. Q. In whose hand- writing is this? — A. I don't know, sir; I never saw it until I just opened it. Q. Have you examined the hand-writing since you opened it? — A. No sir. I dont believe I could tell. It is no hand-writing that I am familiar with. Mr. MiLBUEN. It is not Mr. Rockefeller's handwriting, is it? Witness. I couldnt say, sir. (The minutes unsealed were examined by Mr. Kellogg and Mr. Morrison.) Mr. MoEEisoN. We offer the minutes of this meeting in evidence, commencing on page 36, at the top of the page, which is identified by the witness, and running to the end of the minutes relating to this meeting, on page 45. I think counsel will agree it may be considered read, and copied by the reporter. Mr. Rosenthal. Oh, yes, certainly. We object to it on the grounds heretofore stated. The Examinee. Have it copied right into the record? 198 BENSOIT. Mr. Rosenthal. Yes sir. Mr. Morrison. Yes sir. Mr. Greer. Note the same objection, as immaterial, and 404 not within the issues. The minutes of the meeting, as they appear in the book referred to, are as follows: " Annual meeting of the members of the Tide Water Pipe Company Limited, held at the principal office of said company at Titusville, Pa., on January I7th, 1883 being the time and place fixed by the Rules and Regulations of said association for such annual meeting and for the election of managers and officers for the ensuing year. Present : A. N. Perrin, H. L. Taylor, D. McKelvy, Jno. L. McKin- ney, T. S. McFarland, E. G. Patterson, D. B. Stewart, Geo. A. Berry, Trustee, Jno. Satterfield. On motion of Geo. A. Berry, J. Satterfield was chosen viva voce chairman and D. B. Stewart chosen viva voce secretary. Mr. Berry moved that in view of the fact as stated that the annual statements were not prepared to be exhibited to shareholders that the furnishing of such statements be dispensed with. This motion seconded by E. G. Patterson, and motion being put, all parties present voted in favor thereof except D. McKelvy and A. N. Perrin, and the chairman declared the motion carried. No tellers having been appointed by the managers, Geo. A. Berry moved and was seconded by Mr. McFarland that the chair- 405 man proceeded to appoint tellers to conduct the election of managers and officers for the ensuing year. A vote was taken, but before the decision of the chairman was announced Mr. McKelvy stated and wished his statement placed on the minutes, " That before action was taken on this motion Mr. McKelvy called attention to the fact that the rules require all questions to be acted upon by members to be decided by a stock vote and desired that the pending motion be so decided." " Geo. A. Berry on behalf of himself and his co-trustees protests against the foregoing statement of Mr. McKelvy forming any part of the minutes of this meeting, the fact being that the mo- tion was annoimced by the chair upon which no remarks were made, was put by the chair and voted on in the affirmative, which vote showed a majority in the affirmative before the protest of Mr. Mc- Kelvy was made, and it was not until Mr. McKelvy discovered that the vote was entirely in the affirmative that his protest was made." The chair then announced that the motion was carried and he ap- pointed Jno. L. McKinney and H. L. Taylor tellers to conduct the annual election. The following motion is offered by David McKelvy, viz : I move that this meeting of members of the Tide "Water Pipe Com- pany Limited do now adjourn without day and that the determination of this motion be ascertained by a call of the roll and a vote 406 by of the miembers by stock as provided in the rules and regulations. Seconded by Mr. A. N. Perrin. The chairman ruled above motion irregular and out of order. BENSON. 199 Mr. Berry moved and was seconded by Mr. Taylor, that meeting take a recess until 12 o'clock to-day. A vote being taken the chair- man announced the motion carried. At 12 P. M. the chairman called the meeting to order and an- nounced that the meeting was now ready to proceed with the election. Jno. L. McKinney declined to act as one of the tellers in conduct- ing the election, and the chairman thereupon appointed in his place Geo. A. Berry. The tellers then announced that the polls were open and that they were ready to receive votes of members. Mr. McKelvy offered the following "And now in the further progress of said alleged meeting for the election of managers of said Tide Water Pipe Company Limited David McKelvy and A. N. Perrin, stockholders in said' company, moved to adjourn as follows: ' I move that this meeting of members of the Tide Water Pipe Company Limited do now adjourn without day and that the determination of this motion be ascertained by a call of the roll and a vote by of the members by stock as providecl in the Eules and Kegulations. Seconded by A. N. Perrin'. Where- 407 upon the chairman ruled the above motion out of order, and it was not acted upon and the meeting proceeded. " The undersigned did and do protest against such decision and proceeding as unlawful and contrary to their rights and reserving all their rights in the premises request that this protest be entered upon the minutes of the meeting. , David jMcKelvt. A. N. Perrin." Geo. A. Berry raised the point of order that the foregoing protest of D. McKelvy and A. N. Perrin should not be received, that nothing was then in order but the receiving of votes. " David McKelvy for his constituents, members of this association and from whom he holds proxies and for himself protests against the manner in which this election is being held, and without intending to waive any rights votes on his own and principal's stock and desires this protest to be entered on the minutes by the secretary and by the tellers in their report." At 2 p. m. the tellers announced the polls closed. On motion of Mr. McFarland a recess Avas then taken until 5 o'clock p. m. to give the tellers tims to canvass the votes and prepare their report. At 5 o'clock the chairman again called the meeting to order. The tellers announced that they were not then ready to report and would not be ready to report till 1 : 30 p. m. 408 Mr. McFarland then moved that a further recess be taken till 7:30 p. m., which motion was seconded by Mr. Taylor and carried. The chairman called the meeting to order at 7:30 p. m. The tellers then announced the result of the election by presenting the following report which was read. 200 BENSON. '■ The undersigned tellers duly appointed at the regular annual meeting of the stockholders of the Tide Water Pipe Company Lim- ited held at the principal office of said The Tide Water Pipe Com- pany Limited in the City of Titusville, state of Pennsylvania, to receive and count the votes cast by the shareholders of the said The Tide Water Pipe Company Limited for five managers and officers to conduct the business of the said The Tide Water Pipe Company Limited for the ensuing year make this report to the shareholders of the said The Tide Water Pipe Company Limited. " That the said tellers opened the polls at twelve o'clock noon, and kept them open until two o'clock p. m. of said day at the principal office of the said The Tide Water Pipe Company Limited in the said city of Titusville and received all votes offered during and between said hours, which votes were cast as follows, and for the persons respectively as set opposite their respective names 409 " T. S. McFarland cast 17 votes for John Satterfield. T. S. McFarland cast 16 votes for T. S. McFarland. T. S. McFarland cast 17 votes for D. B. Stewart. E. G. Patterson cast 84 votes for John Satterfield. E. G. Patterson cast 83 votes for T. S. McFarland. E. G. Patterson cast 83 votes for D. B. Stewart. H. L. Taylor cast 2,467 votes for John Satterfield. H. L. Taylor cast 2,467 votes for T. S. McFarland. H. L. Taylor cast 2,466 votes for D. B. Stewart. D. B. Stewart cast 17 votes for John Satterfield. D. B. Stewart cast 17 votes for T. S. McFarland. D. B. Stewart cast 16 votes for D. B. Stewart. D. B. Stewart cast 280 votes for John Satterfield. D. B. Stewart cast 280 votes for T. S. McFarland. D. B. Stewart cast 280 votes for T>. B. Stewart. John L. McKinney cast 167 votes for John Satterfield. John L. McKinney cast 167 votes for T. S. McFarland. John L. McKinney cast 167 votes for D. B. Stewart. John Satterfield cast 25 votes for Jas. R. Keene. John Satterfield cast 25 votes for Franklin B. Gowen. David McKelvy, Trustee, cast 70 votes for B. D. Benson. David McKelvy, Trustee, cast 70 votes for A. N. Perrin. David McKelvy, Trustee, cast 70 votes for James E,. Keene. David McKelvy, Trustee, cast 70 votes for F. B. Gowen. David McKelvy, Trustee, cast 70 votes for R. E. Hopkins. 410 "All of which votes were unchallenged, were received, and counted by the tellers. " David McKelvy as attorney in fact offered the following votes : As attorney for Marshall Ayres Junior cast for B. D. Benson, 20 votes ; for A. N. Perrin 20 votes, for F. B. Gowen, 20 votes, for James E. Keene, 20 votes, for E. E. Hopkins 20 votes. As attorney in fact for C. B. Benson, for B. D. Benson, 65 votes, for A. N. Perrin 65 votes, F. B. Gowen 65 James E. Keene 65, and E. E. Hopkins 65. BENSON. 201 As attorney-in-fact for S. J. Benson he cast for B. D. Benson 30 votes, A. N. Perrin 30, F. B. Gowen 30, James R. Keene 30, and R. E. Hopkins 30. As attorney for 8. Q,. Brown cast 50 votes for B. D. Benson, 50 for A. N. Perrin, 50 for F. B. Gowen, 50 for James E. Keene, and 50 for R. E. Hopkins. As attorney for W. B. Benedict he cast 50 votes for B. D. Benson, 50 for A. N. Perrin, 50 for F. B. Gowen, 50 for James R. Keene, and 50 for R. E. Hopkins. As at- torney for A. N. Perrin he cast 200 votes for B. D. Benson, 200 for A. N. Perrin, 200 for R. B. Gowen, 200 for James R. Keene, and 200 for R. E. Hopkins. As attorney for Thos. B. Riter cast 100 votes for B. D. Benson, 100 for A. N. Perrin, 100 for R. B. Gowen, 100 for Jas. R. Keene and 100 for R. E. Hopkins. As attorney for B. S. Perrin he cast 7 votes for B. D. Benson, 7 for A. N. Perrin, 7 for F. B. Gowen, 7 for James R. Keene, and 7 for R. E. Hopkins? As at- torney for Josiah Lombard 45 votes for B. D. Benson, 45 for A. N. Perrin, 45 for F. B. Gowen, 45 for James R. Keene, and 45 411 for R. E. Hopkins. As attorney for G. L. Benton 10 votes for B. D. Benson, 10 for A. N. Perrin, 10 for F. B. Gowen, 10 for James R. Kenne, and 10 for R. E. Hopkins. As attorney for W. H Conley he cast 107 for B. D. Benson, 107 for A. N. Perrin, 107 for F. B. Gowen, 107 for James R. Kenne, and 107 for R. E. Hopkins. As attorvey for J. H. Dixon he cast 5 votes for B. D. Benson, 5 for A. N. Perrin, 5 for R. B. Gowen, 5 for James R. Kenne, and 5 for R. E. Hopkins. As attorney for John Fertig he cast 100 votes for B. D. Benson, 100 for A. N. Perrin, 100 for F. B. Gowen, 100 for James R. Kenne, and 100 for R. E. Hopkins. As at- torney for C. J. Hayes he cast 20 votes for B. D. Benson, 20 for A. N. Perrin, 20 for F. B. Gowen, 20 for James R. Kenne, and 20 for R. E. Hopkins. As attorney for C. C. Jadwin he cast 20 votes for B. D. Benson, 20 for A. N. Perrin, 20 for F. B. Gowen, 20 for James R. Kenne, and 20 for R. E. Hopkins. As attorney for James R. Kenne he cast 20 votes for B. D. Benson, 20 for A. N. Perrin, 20 for F. B. Gowen, 20 for James R. Kenne, and 20 for R. E. Hopkins. As attor- ney for John Wilson he cast 60 votes for B. D. Benson, 50 for A. N. Perrin, 50 for F. B. Gowen, 50 for James R. Kenne, and 50 for R. E. Hopkins. As attorney for R. E. Hopkins he cast 435 votes for B. D. Benson, 435 for A. N. Perrin, 435 for F. B. Gowen, 435 for James R. Kenne, and 435 for R. E. Hopkins. As attorney for B. D. Benson he cast 595 for each of the five directors named above. As attorney for A. A. Sumner he cast 880 votes for each of the five directors named above. 412 "All of which votes were challenged by T. S. McFarland for the same reasons as set forth in written challenge to vote of B. D. Benson hereto attached and made a part of this report and which challenge are sustained by the tellers, for the reasons therein set forth, and for the further reason that the powers of attorney which the votes were cast had with the exception of a small portion of the stock voted, been made prior to and used at a former annual elec- 202 BENSON. tion for managers, as stated by David McKelvy who presented them, and asked to be allowed to vote upon them, after which annual elec- tion the same were surrendered to the association. " David McKelvy voted in his own right 420 shares for B. D. Ben- son, 420 for A. N. Perrin, 420 for F. B. Gowen, 420 for James K. Kenne, and 420 for R. E. Hopkins, which vote was challenged for reason set out in the written challenge attached to the ballot, and which challenge is overruled and the vote admitted. " George A. Barry for himself and his co-trustees Lewis Emery Junior, John H. Dilks, Samuel P. Boyer and A. I. Wilcox offered to cast for John Satterfield 834 votes, for T. S. McFarland 833, and for D. B. Stewart 833 votes, which vote was challenged by David McKelvy for the reason that no power of attorney signed by his associates is presented or surrendered to the association as re- quired by the rules and regulations, and second for the reason that his co-trustees acting in a fiduciary capacity had no power to dele- 413 gate their right or power. " George A. Berry Trustee, claiming to have the assent of his co-trustees, and claiming further the right to act irrespective of their assent, and evidence of their assent being filed with his vote, the same is admitted. " Of the legal vote cast and admitted by the tellers John Satterfield received for manager and chairman 3866 votes, T. S. McFarland for manager and treasurer 3883 votes, D. B. Stewart for manager and secretary 3861 votes, James R. Kenne for manager 515 votes, T. B. Gowen for manager 515 votes, B. D. Benson for manager and chair- man 490 votes, R. E. Hopkins for manager secretary and treasurer 490 votes. A. N. Perrin for manager rceeived 490 votes. " The result of the election being as follows : '' John Satterfield receiving the highest number of votes for man- ager and chairman is declared elected. " T. S. McFarland receiving the nest highest number of votes for manager, and the highest number of votes for treasurer is declared elected. " D. B. Stewart receiving the next highest number of votes for manager, and the highest number of votes for secretary is declared elected. " James R. Kenne and Franklin B. Gowen receiving each 515 votes, being the next highest number of votes received are declared elected managers. 414 " The votes cast and counted by the tellers resulting in the election of John Satterfield, manager and chairman. Thos. S. McFarland, manager and treasurer. D. B. Stewart, manager and secretary. James R. Kenne, manager. Franklin B. Gowen, manager. BENSON. 203 " We attach-hereto a list of the voters or members who voted or of- fered to vote at the said election, also a tally showing the numbers of votes cast and received for the several candidates. "All of which is respectfully submitted. H. L. Taylor, Geo. a. Beret, Tellers:' " List of voters who voted and offered to vote at the election for managers and officers of The Tide Water Pipe Company Limited, JanylYl883. Shares. Marshall Ayres Junior for D. McKelvy proxy offering to vote- 20 C. B. Benson for D. McKelvy proxy offering to vote 65 S. J. Benson for D. McKelvy proxy offering to vote ,___ 30 S. Q. Brown for D. McKelvy proxy offering to vote 50 W. B. Benedict for D. McKelvy proxy offering to vote 50 A. ]Sr. Perrin per D. McKelvy proxy (A. N. Perrin present) offering to vote 200 Thos. B. Eiter, per D. McKelvy proxy offering to vote 100 B. S. Perrin per D. McKelvy proxy offering to vote T Jos. Lombard per D. McKelvy proxy offering to vote 45 415 G. L. Benton, per D. McKelvy proxy offering to vote__ 10 W. H. Conly per D. McKelvy proxy offering to vote 107 J. H. Dixon per D. McKelvy proxy offering to vote 5 John Fertig per D. McKelvy proxy offering to vote 100 C. I. Hayes per D. McKelvy proxy offering to vote 20 James K. Kenne per D. McKelvy proxy offering to vote 20 John Wilson per D. McKelvy proxy offering to vote 50 E. E. Hopkins per D. McKelvy proxy offering to vote 435 B. D. Benson per D. McKelvy proxy offering to vote 595 A. A. Sumner per D. McKelvy proxy offering to vote 880 D. McKelvy voting 420 D. McKelvy, Trustee, voting 70 J. L. McKinney voting 100 T. S. McFarland voting 10 E. G. Patterson voting 50 B. D. Stewart voting 168 Jos. H. Simonds, by D. B. Stewart proxy 10 John Satterfield, voting , 10 C. C. Jadwin voting 10 H. L. Taylor voting 1480 G. A. Berry, S. P. Boyer, A. I. Wilcox, L. Emery Jr., J. W. Dilkes, Trustees, voting 500 " We certify the within list of voters to be true and correct. H. L. Taylor, Geo. a. Berry, Tellers.'" 204 BENSON. 416 " TALLY-LIST. " John Satterfield reed, for manager thirty-eight hundred and sixty-six votes (3866). T. S. McFarland reed, for manager thirty-eight hundred and sixty-three votes (3863). B. D. Stewart reed, for manager thirty-eight hundred and sixty- one (3861) votes. Jas. R. Kenne reed, for manager five hundred and fifteen votes. Franklin B. Gowen reed, for manager five hundred and fifteen votes (515). B. D. Benson reeeived for manager four hundred and ninety (490) votes. R. E. Hopkins reed, for manager four hundred and ninety (490) votes. A. N. Perrin reed, for manager four hundred and ninety (490) votes. John Satterfield reed, for chairman thirty-eight hundred and sixty-six (3866) votes. T. S. McFarland reed, for treasurer thirty-eight hundred and sixty-three (3863) votes. D. B. Stewart reed, for secretary thirty-eight hundred and sixty- one (8861) votes. B. D. Benson reed, for chairman four hundred and ninety votes. 417 R. E. Hopkins reed, for secy, and treasurer four hundred and ninety votes. H. L. Taylor, Geo. a. Berry, Tellers:' 418 Q. Mr. Benson, have you the book that shows the meeting that immediately followed this meeting? — A. Yes sir. Q. Is that the book ? — A. Yes sir. No. 2J. Q. That which you now have in your hands ? — A. Yes sir. Q. What is that book? — A. The minute book of the Tidewater Pipe Company, Limited. Q. What does it contain? — A. It contains the minutes of the members' meetings and also of the managers' meetings. Q. What page in that book do you find recorded the transactions that took place at the next meeting after the one we have just been talking about? — A. Record of a managers' meeting held January 1883. Q. Was there anything said at that meeting in reference to this last meeting ? — A. Shall I read it ? Q. Let me see it. Mr. Kellogg. If it is not too long I would read it. Mr. Morrison. We offer the record of this next meeting in evi- dence. Commencing on page 16, and ending where? BENSON. 205 Witness. Ending on the same page. Mr. Morrison. You may read that, IMr. Benson. Mr. EosENTHAL. Same objection as was made to the introduction of the minutes of the last preceding meeting. Mr. Geeer. Same objection. 419 Witness. (Reading) : " Managers' meeting held at the oifice of the Tidewater Pipe Company, Limited, corner of Third and Walnut Streets, Philadelphia. January 18, 1883. " Present : B. D. Benson, F. B. Gowen, and James E. Keene. " On motion of F. B. Gowen, seconded by B. D. Benson, James E. Keene was elected secretary pro tem ; and on motion of F. B. Gowen, seconded by James E. Keene, the following resolutions were adopted, to wit : " Eesolved, That I). B. Stewart, the comptroller of the company, is hereby discharged, said discharge to take effect immediately, and that E. E. Hopkins, the secretary of the company, perform the duties heretofore pertaining to the comptroller. " Eesolved, That this board repudiate the alleged election of managers yesterday at Titusville, Pennsylvania, and that counsel be directed to file a bill at once in the proper court to set aside such alleged election. " Eesolved, That all officers of the company be instructed to retain possession of its property, books, papers and effects, and to recognize no orders or authority coming from any other than the old board of managers." (Signed) James E. I&jene, Secretary of Special meeting P Then, below, is: " The above is a true copy of resolutions passed at a special meting held in Philadelphia the year above stated. B. D. Benson." 420 Q. Who is that signed by? — A. B. D. Benson, my father. Q. Do you know his signature? — A. Yes sir. Q. It is the signature of B. D. Benson, is it? — A. Yes sir. Q. And what position did he hold at that time? — A. He was the chairman of the company, or, as we call it now, the president. Q. Well, what follows? — A. In regard to this alleged meeting? Q. Yes. Is there anything further in reference to that meeting ? — A. Xo sir. I think not, except that later on, at a members' meeting, the minutes were ordered sealed. Q. Turn to that meeting. Mr. Lewis. Page 27, Mr. Benson. Q. You find it, do you, on page 27?— A. Yes sir. This is from the annual members' meeting, room No. 1, Ealston and Harrington Block, Titusville, Pennsylvania, April 7, 1883. That was the date of the meeting. Now, on page 27 there is a resolution which was passed at that meeting referring to the previous so-called meeting. Mr. MoRPasoN. We offer that in evidence. Mr. EosENTHAL. Same objection. 206 BENSON. Mr. Geeee. Same objection. Witness. Shall I read the resolution that was passed ? Mr. MoEEisoN. Yes. 421 WiTXESS (Reading) : "The following resolution was offered by A. A. Sumner, seconded by William H. Conely, viz : " Resolved, That the entries upon pages of minute book No. 2 of the Tidewater Pipe Company, Limited, from numbers 36 to 45, both inclusive, which purports to refer to a meeting held January 17, 1883, for the alleged purpose of electing managers of said com- pany, be sealed up and treated as expunged from the records of said company, as no proper part thereof, unless and to the extent that the courts may otherwise order or decide. " This resolution was adopted by the following stock vote, viz : 3,781 shares voting in the affirmative, and none in the negative." Q. Did any litigation follow that, Mr. Benson? — A. Yes sir. Q. In what court ? — A. In the Court of Common Pleas for Craw- ford Counter, where the principal office of the company was located. Q. Do you know whether the action of the stockholders of this last meeting was sustained? — A. The so-called action was not sustained. Q. Well, of which meeting was not sustained ? — A. The " Rump Parliament," so to speak. Q. Well, you mean Mr. Rosenthal. Sealed up. 422 Q. The sealed-up minutes. — A. The sealed-up minutes, yes sir. Q. Was not sustained. Mr. MoEEisoN. In connection with that, gentlemen, I want to offer the opinion of the Judge in that case. We offer here the opinion of the Judge who tried this case to which we refer. Mr. Rosenthal. I object to the opiiaion of the Judge, not upon the ground that it is not certified. We will waive that objection. There are a few others that I might state. First, upon the ground that the o^jinion of the Judge is no part of the record ; secondly, upon the ground that the opinion of the Judge, in any event, does not create any interference of any kind against any one of these defendants; and, thirdly, upon the ground that the judgment rendered in that case is the only and material thing as between the parties to that case ; fourthly, upon the ground that the Standard Oil Company and none of the defendants, except the Tidewater Company, was a party to that proceeding. The opinion of the Judge above referred to was marked Petitioner's Exhibit 23. Q. Mr. Benson, has the Standard Oil Company now any interest in the stocks of this TideVater Companj^ ? — A. Yes sir. Q. To what extent has it an interest? — A. A little more than 423 31 percent of our capital is owned by the Standard Oil Com- pany, we understand. Mr. MiLBUEN. That is admitted, isnt it? BENSON. '207 Q. Turning now to the minutes of this meeting which were sealed up, tell me whether or not you can trace any of the stock which is now owned by the Standard back to any of the gentlemen who partic- ipated in that meeting. (Witness refers to minute book No. 2.) Witness. Shall I rend the names of them? A. Yes, read the names of those. A. I find by referring to the minutes of the meeting which were sealed that the following persons were recorded as being present in person: A. N. Perrin, H. L. Taylor, D. McKelvy, John L. McKin- ney, T. S. McFarlar.d, E. G. Patterson, D. B. Stewart, George A. Berry, trustee, and John Satterfield. Of the people named as being present at the meeting, the stock of all except Mr. Perrin and Mr. McKelvy were later transferred to gentlemen who, we understood, represent the Standard Oil Company interests. Mr. MiLBUEN. Later transferred to whom? Witness. The gentlemen who, we understand, were interested or repi'esented the Standard Oil Company's interest. 424 Mr. EosENTHAL. Well, I move that be stricken out on the ground that in so far as anything that appears in the answer is concerned, it is entirely hearsay, and I offer to show now, by cross- examination of the witness, that it is hearsay in so far as he knows. Q. Mr. Benson, I will ask you to take the stock of each of those gentlemen and trace it down to its present ownership, except the two which you mention. Have you the books here that show the transfer of that stock? — A. I think so. Whenever there is any stock of that kind transferred it is recorded in these minute books. Q. Can you turn to the minute books and show the transfer of that stock? — A. I think so, sir. Q. I wish you would do that. — A. Will you ask Mr. Lewis to step here for a minute. (Mr. Lewis comes to the witness-stand.) Witness. If you will give me the record. Mr. Lewis. All right. Witness. On what page is it? Mr. Lewis. It is page 181. Mr. KosENTHAL. Havcut you got a list of them there, without re- ferring to it? Witness. No. Mr. Eosenthal. Dont you Imow, Mr. Lewis? 425 Mr. Lewis. Yes. Mr. Eosenthal. We will take Mr. Lewis' statement of it, if he knows, it, without going into the records at all. Mr. Kellogg. Mr. Benson knows it also ; he can testify. Mr. Eosenthal. Either one. I thought Mr. Benson didnt know it. Witness. The first record that I find is the following: "At a members' meeting held in Titusville August 11, 1884, stock was transferred by vote of members as follows : From H. L. Taylor to George W. Colton 1,479 shares; from P. S. McFarland to George 208 BENSON. W. Colton 9 shares; from J. L. McKinney to George W. Colton 99 shares; from John Satterfield to George W. Colton 9 shares; from John Pitcairn, Jr., 120 shares to George W. Colton, and from D. B. Stewart to George W. Colton 168 shares. That makes a total of 1884 shares that were transferred at that meeting. Q. What became of that stock finally? What did Colton do with it* Mr. Lewis. Book 4, page 87. (Handing book to witness.) Mr. Greer. What was the date of that meeting at which that trans- fer took place? Witness. That was dated August 11, 1884. Mr. Lewis. Wait a moment. It is book 5, page 71. That is where Cuthbert got it. Witness. I find, Mr. Morrison, that at a meeting of the 426 members held in. Titusville July 31, 1893, there were trans- ferred from George W. Colton to John H. Cuthbert 1884 shares. Q. Is that all of it? — A. All of it that appears in that previous meeting. Q. What was the next transfer of that stock ? Mr. Lewis. Pa 117. (Handing minute-book to witness.) A. The next transfer appears in the minutes of a meeting held at Titusville April 14, 1900. At this meeting the 1884 shares, which had been pieviously transferred to Mr. Cuthbert. were transferred to William G. Rockefeller. Q. Have there been any transfers since that ? — A. Yes sir. Q. In whom is the present ownership of those shares? — A. Mr. H. C. Folger's name. Q. For whom does he hold them? — A. I suppose, sir, for the Standard Oil Company. Q. Who is George W. Colton? — A. I never knew Mr. Colton, but I understood he was the treasurer at one time of the Standard Oil Company. Q. Who was John H. Cuthbert? — A. He was a man that repre- sented the Standard interests. He held a position at one time as manager of our company. Q. How long after that meeting, which you call the Rump Parlia- ment, was it that these shares of stock about which you have been testifying, were transferred from the persons who sold them at the time of the meeting? — A. The exact dates are there. The Rump Parliament was held in January 1883, I think, and the meeting was in August 1884. 427 Q. Well, now, the meeting in xVugust was the meeting at which 3'ou transferred them on the books? — A. Yes. Q. Do you know when they were actually transferred from those persons to Mr. Colton? — A. No, sir, I have no knowledge. Q. It must have been some time before the holding of that meeting, must it not? — A. Not necessarily; it must have been afterwards. I dont know anything wbout it. BENSON. 209 Q. They were transferred on the books at that meeting?— A. Yes. Before the meeting of August? Q. Yes. — A. Yes sir. Mr. MiLBTjRN. August of what year ? Witness. 1884. Q. Have you any record anywhere that will show just when those shares of stock were transferred to Colton, — not on your minute- books, but on the shares themselves? — A. No, sir. Q. Mr. Benson, there was a subpoena duces tecum served upon you, asking you to produce the books that would show the sto6kholders and owners of the Tide Water Pipe Company, Limited, and also of the Tidewater Oil Company. — A. Yes sir. Q. Have you those books here ? — A. No sir, but I have a certified list, a list that I can testify to as being correct of the stockholders. Q. Will you produce that list ? Mr. Lewis. AVe only have one copy of that, Mr. Morrison. 428 The copy we furnished you is there. You vnn see this list if you desire. Mr. Morrison. I hand the witness this paper. Q. I believe you furnished us two lists : one as they stood when the subpoenas were served, and one as they stand at present. — A. Yes sir. Q. Will you please produce the list now of the stockholders at the time of the service of the subpoena? It is marked No> 2 in this list. Can you separate it so that we can offer it as an exhibit? — A. Yes sir. That is the list. (Handing paper to Mr. Morrison.) Mr. Morrison. This is the list, gentlemen. We will offer it in evidence as Petitioner's Exhibit 24. Q. Have you the list of the stockholders as they are at present? — A. Yes sir. Q. The paper you hand me is the list of holdings in the Tidewater Pipe Company, Limited, as of September 11, 1907 ?— A. Yes sir. Mr. Morrison. We offer this in evidence, and ask to have it marked Petitioner's Exhibit 25. The list was so marked. Q. Have you a list of the stockholders of the Tidewater oil Com- pany at the time of the service of the subpoena ? Mr. MiLBTjEN. Why do you draw a difference between that time and the present, Mr. Morrison? 429 Mr. Morrison. Because a change has taken place. Mr. Lewis. We have not furnished you that, Mr. Morrison. We have furnished you the list as it is to-day only. Mr. Morrison. Give us that. Have you the list of the stockholders in the Tidewater Oil Company as of the present time? Witness. As of September 11th. Mr. Morrison. We will offer this list in evidence and ask to have it marked Petitioner's Exhibit 26. The list was so marked. 32555—08 14 210 BENSOir. Q. Quite recently, and since the service of the subpoena upon you, as I understand it, there has been some change made in the owner- ship of these two companies ? Will you explain what that is ? — A. Formerly the Tidewater Oil Company was a subsidiary company of the Tidewater Pipe Company. The Tidewater Oil Company, the stock has recently been increased, and it lias become the parent or holding company of the stock of the Tidewater Pipe Company, so that it is now the head company, and the ownership of the outside stockholders, which were formerly in the Tidewater Pipe Company, now appear in that list of owners of the Tidewater Oil Company stock. Mr. MiLBUEN. Which is the principal company now? Witness. The Tidewater Oil Company. Q. What has become of the stock under this recent change, 430 that was held by the Standard interests before? — A. It is embraced in the stock in the Tidewater Oil Company. Q. In whose name is it now ? — A. Mr. H. C. Folger, Jr. Q. The Standard, then, has the same interest in it that it had before this recent change? — A. Just the same. Q. On the 9th of October, 1883, was there a contract entered into between the Standard Oil Company of Ohio, the Standard Oil Com- pany of New York, and the Standard Oil Company of New Jersey, of the first part, and the Ocean Oil Company of New Jersey, the Chester Oil Company of Pennsylvania, and Ayres & Lombard of New York, party of the second part? — A. I have no knowledge of the contract between the refining companies — Was the pipe company mentioned there the same as the Tidewater Pipe Company ? Q. No sir, not in that first contract. — A. No sir, I have no records. Q. Have you a record of the contract following it and supple- mental to it, which is dated on the same day, October 9, 1883, between the National Transit Company and the United Pipe Lines, a cor- poration of the state of Pennsylvania, parties of the first part, and the Tidewater Pipe Company, Limited, of the second part? — A. There is a record made of a contract being authorized on that date in the minute book. Q. Have you examined Exhibit 13 of this bill ? — A. Yes sir. 431 Q. What record have you in reference to Exhibit 13? — A. Simply a brief record that a contract with those parties named was authorized on that date. Q. And will you turn to your record which mentions that contract? Mr. Lewis. Book 2-J, page 43. A. Yes sir. Q. What book have you in your hands? — A. Minute book No. 2|, record of a managers' meeting held at New York October 9, 1883. Q. What book is that ? — A. It is a minute book of the members and managers of the Pipe Company. Q. What does it contain ? — A. The record of their meeting. Q. Meetings of the members of that company? — A. Members, and also the managers. Q. Members and managers? — A. Yes. BENSON. 211 Q. Is that a meeting of the members or the managers to which you first referred? — A. Managers' meeting. Mr. MoRHisoN. We offer that in evidence. Mr. EosENTHAL. Same objection as stated heretofore. Mr. MoERisoN. You may read that into the record. Witness. You want just the resolution, or the record of who were present, etc? Mr. MoEEisoN. Oh, read the whole record in reference to it, I guess. 432 Witness. "A meeting of the board of managers of the Tide- water Pipe Company, Limited, held at the branch office of the company, in the Boreel Building, in New York City, on the 9th day of October, A. D. 1883, at which were present B. D. Benson, F. B. Gowen, James R. Keene. " The chairman stated that the purpose of the meeting was to con- sider the propriety of making the contract heretofore referred to. A proposed contract between the National Transit Company and the United Pipe Lines, of the first part, and the Tidewater Pipe Com- pany, Limited, of the second part, was now read and fully considered. Whereupon the following resolution was offered by Mr. F. B. Gowen, seconded by Mr. James R. Keene, namely : " Resolved, that the contract herewith submitted, dated October 9, 1883, between the National Transit Company and the United Pipe Lines of the first part, and the Tidewater Pipe Company, Limited, of the second part, is hereby approved and adopted as the agreement of this company, and any two or more of the managers of this com- pany are hereby authorized to execute the same in the name and on behalf of the company. " This resolution was adopted, all the managers present, namely, B. D. Benson, F. B. Gowen, and James R. Keene, voting in favor thereof. On motion of Mr. Keene the managers' meeting adjourned." 433 Q. That is all there is in- reference to that, is it ? — A. Yes sir. Q. Now, was that contract passed upon by any other board or any other set of managers or owners of your compaiy? Witness. Have you a record of it, Mr. Lewis ? Mr. Lewis. Page 146, in the same book. Witness. Yes sir. Q. What page is it?— A. Page 146. Q. Of the salne book? — A. Of the same book. Mr. MoREisoN. We offer that in evidence. Mr. Rosenthal. Same objection. Mr. MoEEisoN. You may read that. Witness. This is at the annual meeting of the members held Janu- ary 16, 1884, at Titusville, Pennsylvania. " Mr. W. H. Conley offered the following resolution, and moved its adoption, the motion being seconded by Mr. S. Q. Brown, namely : " Resolved, That the contract dated October 9, 1883, between the National Transit Company and the United Pipe Line of the first 212 BENSON. part, and the Tidewater Pipe Company, Limited, of the second part; the contract dated October 9, 1883 between the Standard Oil Com- pany et al, of the first part, and the Ocean Oil Company, the Chester Oil Company, et al., of the second part; supplemental contract dated November 3, 1883, between the National Transit Company and 434 the United Pipe Lines of the first part, and the Tidewater Pipe Company, Limited, of the second part; and the supple- mental contract dated November 3, 1883, between the Standard Oil Company, et al., of the first part, and the Ocean Oil Company, the Chester Oil Company, et al, of the second part; all of which con- tracts are herewith submitted for the examination of the members of this company, are hereby severally ratified and approved." Then follows the record of the stock vote being taken. It was affirmed by a vote of 3,796 shares in the affirmative and none in the negative. Q. Well, now, that resolution refers to both contracts about which I have asked you, does it not? — A. Yes sir. Q. And that is a resolution of the stockholders ? — A. Of the stock- holders, yes sir. Q. Of the Tidewater Pipe Company, Limited ? — A. Yes. Q. When you say " members " you mean stockholders ? — A. I mean stockholders. Q. Now, give us again, if you please, the dates of those two meetings. Witness. Will you give me the page again, Mr. Lewis? Give me the page of the managers' meeting first. Mr. Lewis. Yes. Witness. He wants the date of the two meetings. Mr. Lewis. That is, the date of the two last meetings? Witness. The managers' meeting first. 435 Mr. Lewis. October 9, 1883, is the managers' meeting, and January 16, 1884, is the members' meeting. Mr. MoHRisoN. That is all that is necessary on that. Q. I now call your attention to Schedule A and Schedule B at- tached to Exhibit 13 on page 261 of the bill. Were these companies in Schedule A Standard Oil companies, or controlled by them? — A. Well, I am not sure about that, but I presume they were. Q. And how about Schedule B? — A. Those were companies con- trolled by or affiliated with the Tidewater Pipe Company, Limited. Q. Now, I think I will go over this list with you, Mr. Benson. How about the Atlas Refining Company Works at Buffalo, New York ? — A. I always understood that was a Standard concern. Q. Plow about the Acme Oil Company of Pennsylvania, works at Titusville, Pennsylvania ?— A. That is a Standard company. Q. The Acme Oil Company of New York, works at Olean, New York? — A. That is a Standard company. Q. Atlantic Refining Company, works at Philadelphia ?— A. That is a Standard Oil concern. BENSON. 213 Q. Baltimore United Oil Company, works at Canton, Maryland? — A. I dont know anything about that. Q. Bush, Denslow Mfg. Co., works at South Brooklyn, New York? — A. They are a Standard Company concern. 436 Q. Camden Consolidated Oil Company, works at Parkers- burg, West Virginia ? — A. I dont know about that. Q. The Central Refining Company (Limited), works on Newtown Creek, Long Island. Mr. MiLBTjRN. You have left out another Camden. Witness. I dont know about that. Mr. MiLBUEN. Works at Canton. Q. How about the Camden Consolidated Oil Company, works at Canton, Maryland ? — A. I dont know anything about that. Q. Empire Refining Company (Limited), works on Newtown Creek, Long Island ? — A. I dont know about that. Q. The Eclipse Lubricating Company, works at Franklin, Penn- sylvania ? — A. That was a Standard Oil Company concern. Q. And the Eclipse Lubricating Company (Limited), works at Olean, New York ? — A. That was a Standard Company. Q. Eagle Oil Company, works at Conununipaw, New Jersey? — A. That was a Standard Oil company. Q. Galena Oil Works (Limited), works at Franklin, Pennsyl- vania? — A. That is Standard. Q. Imperial Refining Company, works at Oil City, Pennsylva- nia? — A. Standard. Q. Pratt Manufacturing Company, works at Bushwick Creek, Long Island ? — A. That is Standard. 437 Q. Jenny & Son, works at Wallabout Land. Do you know anything about that ? — A. I dont know anything about that. Q. Donald & Company, James, works at Newtown Creek, Long Island? — A. I never heard of that; I dont know any thing, about that. Q. Portland Kerosene Company, works at Portland, Maine. — A. I dont know anything about that. Q. Paine, Ablott & Company, (Limited), works at Smiths Ferry. — A. I dont know anything about that one. Q. And Paine, Ablett & Company (Limited), works at Freedom, Pennsylvania. — A. I never heard of that one, of the Paine, Ablett Company. Q. Some Fleming Manufacturing Company, (Liirited), works at Newtown Creek, Long Island.— A. That is a Standard concern. Q. Standard Oil Company of New York, works at Newtovn Creek, Long Island.— A. Well, as the name would imply, they are all Stand- ard Oil companies. Q. Standard Oil Company of New York, works at Hunter's Point, Long Island. — A. Yes sir. Q. Standard Oil Company of New Jersey, works at Bayonne, New Jersey. — A. Yes sir. Q. Standard Oil Company of Pennsylvania, works at Pittsburg.— A. Yes sir. 214 BEKSON. Q. Standard Oil Companj^ of Ohio, works at Cleveland, Ohio.— A. Yes sir. 438 Q. The Union Refining Company, (Limited), works at Oil City, Pennsylvania. — A. I dont know anything about that one. Q. Vacuum Oil Company, works at Rochester, New York. — A. That is now considered Standard Oil Company. I dont know whether it was at that time. Q. You said, I believe that those in Schedule B were affiliated with the Tidewater Pipe Company, Limited? — A. Yes sir. Q. And are they still? — A. They are all out of existence; there are none of them in existence. Q. And what has become of them? — A. They have been merged in the Tidewater Oil Company, except the Chester Oil Company ; the works were abandoned, and afterwards sold. Q. Mr. Benson, you were asked by the subpoena duces tecum to produce this contract of October 9, 1883. Are you able to produce it? — A. No sir. Q. What, if any, effort have you made to find that contract ? — A. I have searched myself at the places where I would think that contract would have been kept, and have not found it, and I have also caused search to be made by our clerks and bookkeepers and others, and have not been able to find it. Q. Have you any copy of it on the minutes or any of your books of record? — A. No, sir; there is no reference to it on the minutes except such as I have read to you? Mr. MoEKisoN. Gentlemen, I think we called upon you 439 for that contract also. Are you able to produce it ? Mr. Rosenthal. Not yet, no. Q. Well, I will ask you now whether or not this contract here is substantially a copy of the contract that existed between these com- panies and under which you operated? — A. I cannot say about that. Q. Well, you remember something about the contract, dont you? — A. Only from tradition and hearsay; I didnt have any part in the company at that time. Q. Well, you know there was a contract existing, did you not, in which there was a division of the business ? — A. I have always under- stood Mr. Geeee. I object, because he says he doesnt loiow. It is hearsay. Mr.MiLBUEN. If he says he was not a member of the company at this time, it is rather Q. You were connected with the company, werent you? — A. Oh, in a minor capacity, yes sir. Q. You attended some of those meetings? — A. As a member, yes sir. Q. When this contract was ratified ? — A. Yes sir, the records show that I was present as a member at the time the members voted on it. Q. Now, what was the division, as you understand it, in the con- tract that was adopted? BENSON. 215 440 Mr. Rosenthal. I object to it upon the ground that the witness has just stated that he has not any personal knowledge whatever of it. Mr. Morrison. Well, he knows what contract they operated under. Mr. EosENTHAL. And that he has expressly said that all he knows is by way of tradition. Q. You know what contracts you operated under, don't you? — A. Only as tradition, as I might express it. I am not familiar my- self with the contract at the time we operated under it. Q. Well, do you understand what the division was between those companies ? That part of it do you understand ? Mr. Rosenthal. I object to that because it is manifest that he has no personal knowledge whatever of it. Mr. MttBtJEN. And that to be proper secondary evidence the wit- ness must have seen and read the contract of which he is seeking to give a copy. Mr. Rosenthal. Well, to be secondary evidence, the witness must purport to give the substance of the entire contract. Mr. Morrison. Well, is that all, gentlemen? Mr. Rosenthal. I think that is quite enough. Mr. Morrison. Well, answer the question. A. My understanding was that we were to do eleven and one- quarter (Hi) per cent, of the business — that is, the Tidewater and its affiliated companies. 441 Q. You mean the pipe line company A. The Pipe Line was to transport and the refineries were to refine. Q. Is that contract still in force? — A. No, sir. Q. What became of it ? — A. It was annulled. Q. When? — A. I can't t«ll the exact date without referring to the minutes. Q. Have you a record of it? — A. Yes, sir. Q. Will you produce the record ? Mr. Lewis. Book 4. pages 162, 163 and 164. A. Shall I read it?' Q. Yes. — A. This is at a managers' meeting held in New York March 9, 1891, at which were present David McKelvey (who was then president of the company) , J. G. Benton, R. G. Benson, and R. E. Hopkins, manager. "The following resolution was offered by Mr. Benson, and sec- onded by ]Mr. Benton : "Resolved, That the stipulation herewith submitted, concealing the arrangement existing under letters from Daniel O'Day and J. G. Benton is herebv adopted and approved, and any two managers of this company are authorized and empowered to execute the same in the name and on the behalf of this company." On the vote being taken all the managers present voted m the affirmative on that. 442 Then Mr. Benton offered the following resolution, and moved its adoption. 216 BENSON. " Resolved, That the stipulation now submitted between the Na- tional Transit Company and this company cancelling former agree- ment dated October 9, 1883, and a supplement thereto of the same date, is hereby adopted as the stipulation of this company, and any two manageis are hereby authorized to execute the same in the name and on behalf of the company." That resolution was adopted by a vote of all the managers. And then Mr. Hopkins offered the following resolution, and moved its adoption: " Resolved, That the contract herewith submitted, dated May 13, 1890, between the National Transit Company and this Company re- lating to the delivery of crude oil at Rixford, Pennsylvania, by the former to the latter company is hereby authorized and adopted as the agreement of this company, and any two members are authorized to execute the same in the name and on behalf of this company." That was adopted, all the managers present voting in the affirma- tive. No further business was done at the meeting. Q. Did you receive any letter from John Bushnell in reference to the cancellation of these contracts? — A. Yes sir, I believe we did, at least we find one in our files. 443 Q. Will you produce that letter? Mr. Lewis hands letter to the witness, and the witness hands the same to Mr. Morrison. Mr. Morrison. We offer this letter in evidence. The same was marked Petitioner's Exhibit 27. Q. ^¥ho is Daniel O'Day, whose name was mentioned in that reso- lution? — A. He was one of the managers of the National Transit Company. I don't know what his official position was at that time. Q. Who was John Bushnell who wrote this letter ? — A. He was the comptroller or secretary of the National Transit Company. Q. There is a contract referred to in that resolution of 1893, is there ?— A. 1890, I think. Mr. MiLBURN. That was written in 1891. Mr. Lewis. What is the contract you are speaking about? It is 1890. Q. That resolution refers to a contract entered into in 1890. I hand you this paper and ask you whether that is the contract referred to? — A. Yes, sir; that is a copy of it. Mr. Rosenthal. x\ correct copy? Witness. Yes, sir. Mr. Morrison. We offer that in evidence. 444 The same was marked Petitioner's Exhibit 28. Q. Has this contract been renewed? — A. Yes, sir. Q. ^Vhen was it renewed? — A. It was first renewed, and for ten years, on October 1, 1898. Q. Has it since been renewed? — A. It has been renewed for a further period of ten years, recently. Q. When does the last period commence? — A. On its expiration in 1908. BENSON. 217 Q. So that it runs for ten years from 1908. — A. It practically has eleven years to run now. Q. Are the renewals written on the back of the contract ? — A. The first renewal. The second renewal does not appear on that contract, but it is in the same words exactly as the first. Mr. MoEEisoN. We will offer this renewal, then, on the back of the contract, as a part of Exhibit 28. Q. Mr. Benson, in what business is the Tidewater Pipe Company, Limited, engaged ? — A. The gathering and transporting of crude oil. Q. And has been engaged in that business ever since it was organ- ized? — A. Yes, sir. Q. In what business is the Tidewater Oil Company engaged? — A. In the refining of crude petroleum. Q. I will ask you whether or not either of these companies 445 have ever, since the making of the contract, October 9, 1883, done more than eleven and one-quarter (11^) or eleven and one-half (11^) per cent, of the business? — A. I cannot answer that definitely, whether they have ever done it. As a general thing they have not done that percentage. Q. You don't know that they have ever exceeded that limit? — A. No, I don't think that they ever have done it. I know in recent years they have not had capacity to do anywhere nearly eleven and one- quarter (Hi) per cent, of it. Q. They are running to the full extent of their capacity now ? — A. Yes, sir. Q. Have you ever extended your pipe lines since the making of this contract, in 1883 ? — A. We have never extended — You mean the trunk line? Q. Yes. — A. Well, it was extended, so Mr. Warren testified, so as to finally reach our works. Q. Well, I mean have you extended it at the other end? — A. No, sir, only our gathering lines. Q. Have you made any particular extension of this ? — A. We have spread out and got all the oil we could in the district to which we were contingent. Q. Are you getting any more oil now than you were in 1883 ? — A. Without referring to the amount we got then I can't say, but my im- pression is that we are not. Q. Have you extended your gathering lines into new 446 fields ? — A. I think we have extended into Allegheny County, New York, and to more, perhaps down into Elk County a little. Q. It was necessary for you to make those slight extensions, was it, in order to get the same amount of crude oil you had previously been getting?— A. Yes, sir. The wells are decreasing all the time, and we have to keep getting new wells or we lose our production. Q. You are not getting any more oil by reason of these extensions than you got before ?— A. No, sir. Q. And your business has not enlarged any since 1883, has it?— A. Practically not, I should say. 218 BENSON". Q. Has the business of the Tidewater Oil Company enlarged any since that time? — A. No sir. They refine simply what they get from the pipe companies. Q. Where do you get the crude that you use at this refinery? — A. We get part of it from the Standard Oil Company under the contract wliich has been submitted, and the balance we gather ourselves in Mc- Kean County and Allegheny County — Allegheny Coimty, New York, and McKean County in Pennsylvania. Q,. By means of these pipes you have just been talking about? — A. Yes. Q. How much crude oil has the Standard furnished you now, and have they been for some years back? — A. About three thousand bar- rels a day. Q. And that in connection with what you get yourself through your own pipe lines and gathering lines is enough to run your M7 refinery here, is it not? — A. Yes, it is practically the capacity of our trunk pipe line, and our refinery was built to take care of that capacity. Q. Your contract was made with the Standard people so that you would have enough to keep your refinery going at its full capacity ?— A. Yes, sir. Q. How long has the Standard Oil Company been furnishing crude oil to the Tidewater Oil Company? — A. Since that contract was dated. Q. Which contract do you refer to? — A. The one that was sub- mitted in evidence in full. Mr. Lewis. 1890. Q. You refer to the 1890 contract ?— A. The 1890, yes sir. Q. Between the years 1883 and 1890 did you get any crude oil from the Standard ? — A. I can't say definitely, but I presume we did, perhaps, under that gathering arrangement. Q. Under what? — A. Under the contract that was specified be- fore that, which we have no copy of. Q. You mean the 1883 contract? — A. Yes, sir. Q. Did you get as much as you have under the 1890 contract? — A. I have no means of knowing without referring. I think practi- cally the same. Q. At any rate, you have got enough crude oil from the Standard during all these years since 1883 to run your refinery here to its full capacity? — A. Yes, sir. 448 Q. What became of the product in that refinery ? — A. Why, it is sold. Q. To whom is it sold? — A. Part of it through dealers, part through the Standard Oil Company. Q. What percentage of your export oil is sold to the Standard Oil Company? — A. I don't think we can strictly say that any of it is sold. It is consigned to them and they sell it. They sell about — May I give you some figures that I made up ? BENSON. 219 Q. Yes, sir, taking it on an average for the last three or four years.— A. I find on investigating the subject that for the five years from 1902 to 1906, inclusive, the Tidewater Oil Company sold for export ninety-five per cent, of its refined oil, and five per cent, was sold for domestic purposes. Of the export oil sold, seventy-seven (77) per cent, of it was sold through the Standard Oil Company of New York, and 23 per cent, was sold direct to buyers here in New ' York. Q. Let me see now that I understand those figures. You say that 95 per cent, of your refined oil that is exported is sold to the Stand- ard Oil Company ? — A. No, sir, of our total refined oil that we make ninety-five per cent, was sold for export. Q. What per cent, was sold to the Standard Oil Company? — A, 97 per cent, of the 95 per cent. Q. You mean 77. — A. Yes, 77 per cent. Q. 77 per cent, of the 95 ?— A. Yes, sir. 449 Q. Now what becomes of the difference that 95 per cent, and that 77 per cent ? — A. We sell it to anybody that will buy it, that we can furnish it in condition to take. We can only sell it in cases. Q. Where do you sell it? — A. Here in New York. Q. And for what market ? — A. Well, any market that we can find buyers. As a practical matter, the only buyers for our oil are in South America and in Africa and the West Indies. Q. Then, it does not compete with the oil sent to European coun- tries? — A. No sir, because no case oil is sent to Europe, as I under- stand it. Q. You do not export any oil in bulk, do you, or in tank steam- ers ? — A. No sir, except through the Standard Oil Company. Q. That is this 77 per cent, that they take from you ? — A. Yes. Q. Well, you simply sell what is termed case oil, do you not? — ^A, We sell case oil for export ; we sell other oil for domestic Q. Case oil, I am talking about, for export. — A. Yes. Q. And that is sold principally, as you say, to the South Ameri- can markets? Well, it almost all goes to the Argentine Eepublic, doesn't it? — A. I think a large percentage of it goes to the Argentine Republic. 450 Q. Now you say that 96 per cent, of your oil is exported ? — A. Yes, sir. Q. That includes the oil that the Standard handles, and that you have just mentioned that you handle? — A. Yes, sir. Q. Now what becomes of the other five per cent ? — A. That is sold in the domestic market here in New York ? Q. Well, who sells that? Does the Standard sell any of that? — A. Part of it. Q. How much of that five per cent? — A. They sold about 97 per cent, of the five per cent. Q. How much ? — A. About 97 per cent. 220 BENSON. Q. So that of the oil you sell in this country, of that five per cent, you only market three per cent, of it ? — A. About that, sir. Q. Aiid the Standard markets the rest? — A. Yes. Q. Do you sell it outright to them, or do they act your agents?— A. We consign it to them. Mr. Lewis. Your question means refined illuminating oil ? Mr. MoKEisoN. Yes. Mr. Lewis. Your question has reference more to illuminating oil, hasnt it? Witness. Illuminating oil also. Q. How about the other oil, how is that handled? — A. The lubri- cating oil we sell all ourselves. Q. You dont compound any lubricating oils, do you ? — A. No, sir, except on an order for 451 Q. You simply take the crude that has been treated? — A. We sell very little — I would like to modify that answer. We do occasionally compound oil, but it is usually on an order from a jobber or buyer. Q. Have you any tank steamers? — A. No, sir. Q. Do you know whether or not, shortly before the contract of 1883 was made, that the Tidewater people contemplated establish- ing markets in Europe and getting the money to handle that export business? — A. I cannot give any exact details, but I remember I went to Europe in 1883 with Mr. Hopkins, who was one of the managers, and as I recall he went with the idea of raising capital in Europe to extend the business of the company. Q. Well, were you ordered home? — A. Yes, sir. Q. You didn't make the arrangements, did you? — A. We didn't make the arrangements. Q. And how long after you had got back before this contract was entered into, of October 9, 1883 ? — A. Well, I think it was practically as soon as we got back, or possibly the date — I think we returned in September of 18R:!. Q. What was the total output of the Tidewater Company say for the year 1906? — A. Why, I can't recall the exact figures. Have you these made up? Mr. Lewis. We have got it for 1904; that is what you asked. 452 Q. Well, give us that for 1904. — A. Do you wish the amount of crude run, or the yield, or both? Q. Give us both. — A. In 1904 the Tidewater Oil Company ran •2,745,328.54 barrels of crude. Q. Does that include what you bought of the Standard? — A. Yes, sir. It made as a yield of that product 1,628,940.07 barrels of oil ; 329,370.55 barrels of naphtha. We also mnde 136,501 barrels of lubricating oil, and 36,200 barrels of paraffine wax. Q. In the crude oil run for that year, how much of it was produced from the Standard Oil Company? — A. I suppose, 3,000 barrels a day, that our contract called for. I haven't looked it up to see. BENSON. 221 Q. Well, were you getting the limit that your contract called for at that time, during that year?— A. I can't say without looking it up. Mr. Lewis. It probably did, Mr. Morrison. We have been getting it right along. WrrNESs. Yes. Q. What is the commercial barrel of refined oil, how many gal- lons? — A. 50 gallons. Q. And what is the crude? — A. 42 gallons. Q. Has your company any production? — A. Yes, sir. Mot in the name of the company, but in the name of another. We control a majority of the stock in the Associated Producers Company. 453 Q. And does that own any production ? — A. Yes sir. Q. Whereabouts ? — A. It has production located in McKean County, Pennsylvania, in southern Ohio, in West Virginia, and in Indian Territory. Q. What becomes of your crude that is produced in West Vir- ginia? — A. It is sold to the Standard Pipe Line down there. I don't recall the name of it. Q. The Standard gets that, then ? — A. Yes sir. Q. What becomes of your production in Pennsylvania ? — A. What we can get at, that is attachable to our line, we run ; the rest is sold to the Standard Oil Company, I believe. Q. They connect with it, do they, with their pipes? — A. Yes sir, Q. And do you also connect with it, with your pipes ? — A. What- ever we can connect with, that we reach, we run in our own pipes. They don't run anything we can get ourselves. Q. You say you also have some production in the Indian Terri- tory. What becomes of that oil? — A. That has been sold, so far as it has been sold at all — a large amount of it has been stored, but so far as it has been sold at all it has been sold to the Prairie Oil & Gas Company. Q. That is a Standard concern, as you understand it? — ^A. So I understand it. Q. What pipe lines do you turn your Ohio oil into? — -A. I sup- pose the Ohio Oil Company ; I don't recall. Q. Well, doesn't that business connect with the Buckeye? — 454 A. Oh, yes, I think it is the Buckeye. Q. That is a Standard Oil concern ? — A. Yes. Q. And where is your connection? — A. Wherever the wells are located. They connect with the wells. Q. Do you know anything about the Macksbury division of the Buckeye Pipe Line ? — A. No sir, I don't know about that. Q. Do you sell that oil to the Buckeye Pipe Line Company? — A. We sell it to the National Transit Company, as I understand it. They probably get the runs from the Buckeye. Q. And you sell all this oil, do you, to some of these transit com- panies? — A. Yes. Q. And they are all Standard Oil Companies? ^22 BENSOET. Mr. MiLBURN. We do well by staying with them, and you see they do well by staying with us. We are a peaceful family, if you would only let us alone. We will go on and prosper. Q. Look at the paper I now show you, and tell me what that is. — A. It is a signed agreement, cancelling the contract dated October 9, 1883, between the National Transit Company and the United Pipe Lines and the Tidewater Pipe Company, Limited. Mr. Morrison. We will offer that in evidence. The same was marked Petitioner's Exhibit 29. The Examiner. The hearing will be adjourned at this time until 10.30 tomorrow morning (September 24th). 455 Tuesday, September ^^, 1907. The hearing was resumed at 10 :30 A. M. Robert D. Benson, recalled as a witness on behalf of Petitioner, testified as follows : Direct examination (resumed) by Mr. Morrison: Q. Mr. Benson, when did the National Transit Company get its pipe line through to the seaboard ? — A. I don't know, Mr. Morrison. Q. Do you know about the time? — A. It was some time after the Tidewater line was extended, I think; but I can't tell you the exact time. Q. Do you know whether it was through there before 1883? — A. I think not, sir. Q. You don't know whether it was or not? — A. No sir. Q. The Tidewater was the first pipe line going through, wasn't it, as far to the East as Williamsport ? — A. Yes sir. Q. Now, I want to ask you a little further about this contract of October 9, 1883. As I understood you yesterday, you said you were a stockholder at that time ? — A. Yes sir. Q. You were present at that meeting and voted for the ratification of that proposed contract, and that it was in 456 fact ratified that day? — A. Yes sir, I was present. Q. Now, you were also connected with the company when the contract was finally rescinded? — A. I was one of the directors or managers at that time. Q. Well, you were the manager of the company, werent you ? — A. Not the manager; I was one of the directors. Q. One of the managers, yes. You had before you at that meet- ing, I presume, the letter of John Bushnell? — A. Yes sir. Q. Did you not also have before you the contract to 'which it re- ferred? — A. I cant remember as to that, Mr. Morrison. Q. Cant remember whether it was before you then or not? — A. No sir. Q. This contract had then several years to run, had it not? — A. It had. Q. And was a pretty important contract to your company? — A. Tes. BENSON. 223 Q. I will ask you now whether or not at that meeting (I mean the meeting when it was ratified) a contract was entered into by which the business was divided between the Tidewater Pipe Line Company and the National Transit Company. — A. I think so ; I have no doubt that there was such a contract. Q. You have no question about that? — A. No. Whether 457 that specific contract as set forth in the bill of complaint was the exact contract, I have some doubts about it. Q. But there was a contract entered into on that day, was there not? Mr. E.0SEKTHAL. Wliat day ? Mr. MoEKisoN. That is, October 9, 1883. Q. In which the business was divided between the pipe line com- panies that I have mentioned in a proportion of 11 and a fraction to the Tidewater companies and the balance to the Standard, was there not? — A. I think so. Q. Well, have you any doubt about that? — A. No sir. Mr. MiLBUEN. What is that? Mr. Rosenthal. The 1883 contract, as I understand it. Mr. MoREisoN. Yes, the 1883 contract. Mr. Rosenthal. Hasnt he shown that the execution was author- ized? Mr. Morrison. Yes, I think so. Q. And that contract remained in force, without change, until it was rescinded? — A. Yes sir. Q. In accordance with the letter from John Bushnell ? — A. Yes. Q. And then the contract which was introduced in evidence yester- day was entered into? — A. Yes sir. Q. I want to call your attention to the second clause of this con- tract, which is Exhibit 28. It reads as follows : " The said pipe com- panies shall, prior to the delivery of said oil, purchase the 458 same from the said Transit Company or from parties desig- nated by the Transit Company, at the current market price, (including whatever if any premium it may bear) at the time of pur- chase of similar oil at the place of production, and shall in addition thereto pay to said Transit Company a pipeage or transportation charge of twenty cents per barrel upon all oil so delivered." You are familiar with that clause in the contract, are you ? — A. Yes sir. Q. What do you mean there by this parenthetical clause " including whatever if any premium it may bear " ? — A. I dont think we have ever paid any premium. Mr. Rosenthal. The question is what that means. Mr. Morrison. The question is, what does this mean. Witness. If any premium? Q. Yes, " including whatever, if any, premium it may bear ".—A. It means the price over and above what is termed the Seep Agency price, or the general market price as publicly quoted in certain dis- tricts. In certain districts, the oil is supposed to be better and brings a higher price ; but so far as we are concerned we have never had any of the premium oil. 224 BENSON. Q. Isnt there in some of the fields a premium paid to get the oil, not because it is better oil but because one or another company may want to get that oil away from some competitor? — A. I think that also enters into it at times, Mr. Morrison, although the premium is usually based on the quality of the oil. Q. It may be based on the quality of the oil, but dont you know as a matter of fact, Mr. Benson, that it is not always 459 based on the quality of the oil, but it is very often based on the other proposition I have suggested? — A'. Well, I have heard so ; I dont know anything about it, myself. Q. Well, then, by this contract you entered into an agreement by which you agreed to pay whatever premium they saw fit to put on the oil that you took from them? — A. We were supposed to get it at the price which it cost them. Q. No, but your contract, as you understand it, would give them the right to put a premium on oil and you would have to pay that ? — A. Yes sir. Q. Now, j^ou spoke about the Seep price a little while ago in your answer. What do you mean by the Seep price? — A. The Seep agency is the agency by which the oil is purchased by the affiliated Standard interests from the producers, and that agency makes the market for the crude oil throughout the country where it is established. Q. Well, it is established anywhere, isn't it ? — A. As far as I know, all through the East where we are doing business. I dont know about other places. Q. Then, the Seep Agency price is the market price for oil? — A. The market price. Q. And is that price followed by all the other dealers as the market price? — A. Well, all the other pipe lines follow that price. 460 Q. The pipe lines are the purchasers, are they not, of the oil ? — A. The pipe lines are the purchasers of the oil. This has reference only to crude oil. Q. Then, as a matter of fact, the Standard fixes the price of crude oil, does it? — A. Yes sir, being the larger factor, of course it would fix it. Q. And, as a matter of fact, does it do it? — A. Yes. Q. There isnt any oil exchange where this commodity is bought and sold by which the price is fixed ? — A. Not now ; there was formerly. Q. There was formerly? — A. Yes. Q. When did that cease to exist? — A. I cant say exactly; I think about ten or twelve years ago. Q. And since that time there has been no public exchange ? — A. No sir. Q. How is this price fixed by the Standard until announced, so that the public knows what the price at a certain time is? — A. I havent any ide;i. They simply announce from the Seep Agency that the price on certain days is so much, and they give it to the news- papers. How it is fixed I dont know. BENSON. 225 Q. I know, but j'oii get it then through the press? — A. Through the press, and through official notices from the different Seep Agencies. Q. The Seep Agencies issue official notices as to prices 461 do they?— A. Yes sir. Q. And do you know whether those prices axe telegraphed to the different newspapers or how they get to them? — A. I dont know; I thinii they are given to the local press, wherever they have an agency. It is published in all the oil region papers and in the New York papers. Q. Then, that price, when so announced, becoines the market price until some change is made? — A. Yes sir. Q. Is this price fixed daily, or is it fixed at a certain time and con- tinues luitil changed ? — A. It is fixed and continues until changed. Q. Who fixes the price for export oil? — A. Well, I imagine the larger factor does. They make their price, and everybody else has to follow. Q. Whom do you mean by the larger factor? — A. The Standard Oil Company. Q. They fix the prices and everybody else follows ? — A. Yes. Q. They fix the price at which your oil is sold? — A. They fix the price at which their oil is sold, and we cant get any more and we dont want any less. Q. They therefore fix the price at which your oil is sold? — A. That is the necessary consequence. Q. And the oil they take from you they take at their price, do they not? — A. Yes. 462 Q. And the oil you buy from them (the crude) the 3,000 barrels a day, you buy at the price they fix ?— A. Yes sir. Q. And you are not consulted about that at all ? — A. No sir. Q. You simply take what the price appears to be from their A. What they make as the market price. Q. What they make the market price?— A. Yes. Q. And do they consult with you what this market price shall be before they announce it? — A. No sir. Q. Either as to the crude or as to the export?— A. No sir. Q. You have absolutely nothing to say about that?— A. No sir. Q. Now, you have testified about the meeting which you denomi- nated as the Eump Parliament. I will ask you where you were when that meeting was held.— A. I was here in New York with my father. Q. And do you know whether or not any means were adopted by your father and the other directors, aside from the minority people, to prevent them from getting control of the offices and the business ? — A. My father went the next morning to Philadelphia, and the meet- ing of the managers was held there which the minutes showed which I read yesterday, and then he went that night to Titusville. I accom- panied him, and the offices were barricaded and iiuards put at the doors. 32555—08 15 236 BENSON. 463 Q. At Titusville?— A. At Titusville. Q. That was the main office of the company at that time? — ■ A. That was the main office of the company at that time. Q. How long did that barricade continue? — A. I think until an injunction was obtained, restraining the other people from acting. Q. You dont know how long that was ? — A. I dont know ; it was only a few days. Q. Now then, I noticed from the minutes which were introduced in evidence yesterday, that this stock (what we term the minority stock) first got into the hands of one George W. Colton which you told about yesterday. — A. Yes sir. Q. And later, along in 1893, perhaps, it got into the hands of J. H. Cuthbert? — A. Yes sir. Q. And I want to ask you who J. H. Cuthbert is. — A. Mr. J. H. Cuthbert was a representative of the Standard Oil Company and was a manager of our company, that is, a director. Q. Was he the director in your Board that represented the Stand- ard? — A. Yes sir. Q. "^Vhen did he commence to act as director for the Standard? — A. I cant tell without consulting the minute-books; probably very soon after that stock was transferred to him. Q. And how long did he continue? — A. He was a director at the time of his death in 1903. 464. Q. What became of the stock which he held, after his death? — A. It was then transferred to Mr. William G. Eocke- feller. Q. Well, after his death, who represented the Standard in your Board ?— A. After Mr. Rockefeller Q. No, after Mr. Cuthbert's death.— A. After Mr. Cuthbert's death, Mr. H. C. Folger, Jr. Q. He represented the Standard in your company? — A. Yes. Q. Does he represent it still ? — A. Yes sir. Q,. Were Cuthbert and P'olger, then, the only two gentlemen who have represented the Standard in your directorate? — A. They are the only ones. Q. Do you know whether anybody represented the Standard in your company from 1884 down to 1893 ? — A. No sir, I think not. Q. You think they had no representative at that period? — A. No, they had no representative, I am very sure. Q. Do you know what position Mr. Cuthbert held with the Stand- ard just before he became a director in your company? — A. I think he was one of their auditors. Q. Auditor in what company ? — A. Well, I dont know. One of the western companies, I think. Q. Was it the National Transit Company? — A. I cant say, Mr. Morrison. I dont know. Q. You dont know any more about it than that he was, you think, auditor in some company? — A. Yes. BENSON. 227 465 Q. Do you know whether he held any other position? — A. He did not. Q. At any other time ? — A. He did not while he was with us. Q. Well, before that period^ — A. I dont know anything about it. Q. Where was his place of business or his office just before he be- came a director in your company'^ — A. His residence was in Titus- ville, but he moved about to wherever he was sent, I understand. Q. Did you know him personally? — A. I did not until he became a manager of our company. Mr. Kellogg. You knew him in 1889 and 1890 ? Witness. Yes sir. Mr. Kellogg. Pie was still in the employ at that time? Witness. He was still in the company, I think, at that time. Mr. Kellogg. Of the Standard Oil Company. Was that after he was elected ? Witness. I cant recall. If I may refer to the minute-books, I can tell. Q. Well, the stock was transferred to him at a meeting held on July 31, 1893. Now, was he elected director at that meeting? — A. I cant say, Mr. Morrison, without referring to the minute-books. Q. Have you got the minutes here so you can tell by an examina- tion? — A. Yes sir. 466 Mr. Lewis. You gave the date of his being elected a member, didnt you ? He was elected manager, on page 74. (Handing witness minute-book.) Q. Mr. Benson, what book have you now in your hand? — A. I have the Tidewater Pipe Line, Limited, minute-book No. 5. Q. Does that show when Mr. John H. Cuthbert was elected a di- rector in your company ? — A. Yes sir. Q. When was it? — A. He was elected a director at a meeting of the managers held the third of August, in 1893. Q. And remained down until what time? — A. He died in April, 1903. Q. And he was a director until his death? — A. Until his death. Q. And just before that, for several years, as I understand you, he was connected with the Standard Oil Company in some ca- pacity? — A. Yes sir. Q. You think as sort of an auditor? — A. That is my impression. Q. Now, how far back does your recollection date, that is, back of 1893 ? — A. Well, I never knew Mr. Cuthbert except casually and by sight until he was elected a member of our company. Q. But you knew where he was employed ? — A. Yes, I knew 467 he was employed by the Standard Oil Company, and I learned he was employed as an auditor. Q. How many years just before that? — A. I dont know; I only knew him for a year or two. My home was not in Titusville and I only met him occasionally. i";m 228 BENSON. Cross-examination by Mr. Rosenthal: Q. You say the Seep Agency fixes the price of crude oil. What do you mean by that, Mr. Benson? — A. I mean that Joseph Seep makes a price at which everybody sells that sells to the Standard Oil Company or its affiliated interests. Q. All you mean by that is that the Seep Agency, representing the Standard Oil and the Standard Oil interests, offers a certain price for crude oil to the producers of crude oil, and those producers are at liberty to sell at that price, if they wish to sell? — A. Yes sir. Q. The other producers of crude oil are under no obligations what- soever to follow that price unless they wish to, are they? — A. Cer- tainly not. Q. And the only reason, as a rule, that other purchasers of crude oil adojDt the price fixed by the Standard is because the standard happens to be the largest purchaser of crude oil? — A. That is right, as I understand it. Q,. And just to the extent that it is the largest purchaser of 468 crude oil, the price which it offers tends to make the market price? — A. Yes sir. Q. And that is all you mean by that, is it not? — A. That is all I mean. Q. There is nothing to prevent the Tidewater Company, or any other company purchasing crude oil, to bid either a higher or a lower price on crude than the price which Mr. Seep offers, is there? — A. No sir. Q. With respect to the sale of your export oil to the Standard Oil Company, will you tell us first the difference between export oil and domestic oil, in its characteristics? — A. About fifty percent of the crude oil is a refined oil which the laws of the vaiious states will not allow to be sold in this country. It is too low in fire-test to meet the laws of the states. Therefore, it has to be exported. Q. What is the average fire-test in this country in most of the states ? — A. 150 degrees fire-test, Water White. Q. That is Water White oil that is 150 test ?— A. Yes. Q. Wliat is the average European test ? — A. About 100 flash, about 110 test. Q. Which is, of course, a much lower grade of oil? — A. Yes; it is also an inferior burning oil to Water White 150. Q. Now, as I understand it, then, practically all of the oil 469 that is exported is this inferior grade of oil? — A. All except what is sent to South American comitries and some special markets where there has been a market worked up for the high-class oil. Q. And with respect to that inferior grade of oil, there isnt any domestic market for it, is there ? — A. There isnt any domestic market ; it cannot bi' sold in this country. Q. Now, of course, what I mean by the inferior grade of oil is the low test oil. — A. Yes sir. BENSON. 229 Q. You understand that, dont you ? — A. Yes sir, I understand. Q. I understood you to say that about fifty per cent of the crude is necessarily a low-test oil. — A. That varies in the various crudes, but I am speaking of our crude. Q. That is Pennsylvania crude? — A. The Pennsylvania crude which we get to refine. Q. And you get, perhaps, a larger percentage of the high-grade oil from Pennsylvania than from any other oil produced in this coun- try, do you not? — A. Yes sir, more water white, as I understand it. Q. So that the amount of oil extracted, the crude oil, purchased in the other fields is, in the main, oil that is used for export purposes, is it not? — A. Well, there would be a larger percentage, I think, than there would be from Pennsylvania. Q. Now, when you say the Standard fixes the export price, 470 do you mean anything more than that the Standard makes you a bid for such oil as your refinery produces that has to be sold for exportation? — A. We send our oil to them on consignment, and they account for the sales. They make a market to their brokers, as I understand it, which other people selling outside of them do not follow ; there is no reason why they should. Q. So that your export oil, in the main, is consigned to the Stand- ard? — A. Yes sir. Q. And not sold to the Standard. And whatever profit they may derive from the sale of your exportation is by way of commission as consignee? — A. We pay them a regnilar commission for it and get the returns as it is sold. Q. Why do you sell your export oil to the Standard Oil Com- pany ? — A. Why, the reason is that all of the bulk oil that is exported (and this low-grade oil goes in bulk shipments) is carried in oil ships and handled on the other side in tank-cars and tank-wagons in bulk, which means an enormous outlay of capital, and we didnt feel we could afford to go into that outlay of capital, provided we could make an arrangement which was fairly satisfactory to us with somebody else to handle it for us. Q. So that the smaller refiner of oil, by reason, necessarily, of his lack of capital, can not successfully get into foreign markets?— A. They cant into the bulk market where the low-grade oil goes. 471 Q. Do you Imow anything about who created that foreign market? — A. Why, not personally. I have always understood that it was largely done by the Standard Oil Company. Q. Well, the other side will not object to your giving some hearsay testimony, I apprehend.— A. Well, sir, I have heard Q. Is it not a fact— is it not a part of the history of the oil busi- ness, that the foreign business, in so far as this country is concerned, of bulk business, was established, developed and built up by the Standard Oil Company ?— A. I think so. Q. Now, your refineries manufacture many other products besides the refined oil, do they not?— A. Yes, sir. 230 BENSOIT. Q. And you sell those products yourself? — A. Yes sir, in part. Some of it we sell through the Standard, but generally speaking we sell most of it ourselves. Q. You make your own prices? — A. Well, there is a market price, as we understand it, that we can sell below, or get above, if we can, but that is not feasible. Q. Well, you sell the products of j^our factories exactly as other manufacturing interests sell the products of their factories, do you not? — A. Just the same. Q. At the very highest price you are able to get ; is not that true ? — A. Yes sir. 472 Q. Do I understand that you yesterday testified that 95 per cent of your product is sold abroad ? — A. Yes sir. Q. Why is that? — A. I have just testified why 50 per cent of it is sold. We can not market it in this country. Now, that brings it down to the Water Wiite oil, which is sold in this market almost ex- clusively, and we sell that abroad because, located as we are here in New York, and having facilities for putting oil up in cans and cases, we can get a better price for it than the home trade market would net us. Q. Then, the reason you sell that other 45 per cent abroad is be- cause you get a better price there than you get here ? — A. Yes. That is hardly a fair per cent. 45 per cent refers to all our other products. I refer only to burning oil. The reason we sell refined oil or burning oil, abroad is, that we get a better price. Q. Generally speaking, you sell 95 per cent of your product abroad because it is more profitable for you to sell it abroad than here? — A. We sell 50 per cent of the refined oil abroad because we have to. We sell the balance of the refined oil as far as we can, becaxise it pays better than the home trade market. We only sell in the home trade market what we cant sell abroad. Mr. MiLBtJKN. When you say you sell 50 per cent abroad 473 because you have to, you mean that is the only market? Witness. That is the only market for that grade of oil. Mr. MiLBUEN. For that test? Witness. For that test that we are obliged to make. Re-direct examination by Mr. Morrison : Q. You said, in answer to Mr. Rosenthal's question, that Joseph Seep made the price, and that oils purchased by the Standard Oil Companj' were purchased at that price. That becomes, does it not, Mr. Benson, the market price for everybody? — A. Why, I think all of the smaller people have to follow. They, naturally, do not want to pay more, and they cant get it if they pay less. Q. When you say " smaller people," you mean everybody outside of the Standard, do you not? — A. Everybody outside of the Standard. Q. Of course, as you said to Mr. Rosenthal, a man can sell it for less if he wants to ? — A. Yes sir. BENSON. 231 Q. And he can get more if he can ? — A. Yes sir. Q. That is true of every market, isnt it? — A. That is true of every market. Q. That is true as to grain and provisions and everything else; there is a market price, however, is there not, for all those commodi- ties? — A. I understand so. Q. Yes sir. And there is a market price for oil, isnt there? — A. Yes sir. 474 Q. And that is the Seep price? — A. That is the price that is named by Q. By the Seep Agency ? — A. By the Seep Agency. Q. And the Seep Agency is an agency of the Standard Oil Com- pany, isnt it? — A. Yes sir. Q. All of its oils are bought through that agency? — A. Yes sir. Q. Now, you say that the oil business in Europe, as you under- stand it, was built up by the Standard? — A. Yes sir. Q. I suppose that is merely your understanding of the situation ? — A. Merely my general knowledge of the business after being in it. Q. Well, you know, do you not, that there is a large amount of oil produced in foreign countries? — A. Yes sir; oil has been produced in Germany, Hussia and Roumania. Q. And that oil is principally used in those foreign countries, isnt it ? — A. There is none of it brought to this country. Q. And that oil comes in competition with the oil that is shipped by the refiners from this side of the water ? — A. Yes sir. Q. And you dont know, I assume, anj^thing about the methods used by the Standard Oil Company in getting control of what busi- ness they have in Europe, do you? — A. No more than just hearsay and what I have read in the papers. 475 Q. You speak about not having the means to market your oil abroad and to transport it ; that you didnt have tank steamers and all that sort of thing. I understood from your testi- mony yesterday that when the contract of 1883 was made, you were abroad. — A. Yes sir. Q. Somebody was with you representing the company? — A. Yes sir. Q. At that time seeking to enlist capital in that very enterprise? — A. Yes sir. Q. That is true?— A. Yes sir. Q. And that you were called home by a telegram, and that when you got home, or before you got home, this contract was entered into? — A. Yes sir. Q. Did you ever export oil to Europe— bulk oil ?— A. We used to. Q. And when did you cease doing that?— A. Wliy, I cant give you the exact date. It was when the firm that owned the bulk steamers, the independent firm, sold out. Q. Sold out to whom? — A. To the Standard. Q. And can you tell about when that was ? — A. I think it was about 1890, I should say, but I am not positive without looking it up. 232 BRADY. Q. Did you export your own oil until 1890? — A. We did not ex- port. We sold to that firm that bought it' here in New York. We never exported it ourselves. 476 Q. You sold it, and they expoi-led it? — A. And they ex- ported it. Q. And you think they sold out to the Standard about 1890 ? — A. That is my impression as to the date. Q. You can get that date exactlj^, cant you? — A. I can tell when we ceased doing business with them. Q. And then you immediately commenced doing business with the Standard, did you ? — A. We had to ; there was no other Q. No other transportation company. That is all. (Signed) Robert D. Benson. 477 Anthony M. Brady, called as a witness on behalf of peti- tioner, being duly sworn, testified as follows : Direct-examination by Mr. Kellogg : Q. Y('vr name is Anthony M. Brady? — A. Yes sir. Q. You reside in New York ? — A. Most of the time. My home is at Albany. Q. I can't hear you. — A. My home is at Albany, New York. I am in New York most of the time. Q. Mr. Brady, were you ever an owner of stock or any of the stock of the Manhattan Oil Company ? — A. Yes sir. Q. About when was thnt company organized? — A. I don't remem- ber the date. I think it was about 1892. Mr. Kellogg. I offer in evidence Exhibit 29^, being a certified transcript of tlie articles of incorporation of the Manhattan Oil Company, together with a certified copy of the increase of capital of the Manhattan Oil Company from $500,000 to $2,000,000, dated 14th of May, 1890, together with n certified copy of the decrease of the stock of the Manhattan Oil Company from $2,000,000 to $500,000, dated the 23rd day of May, 1902, and a further certificate of reduc- tion of the capital stock from $500,000 to $150,000, dated the 23rd of October, 1905. Q. According to this certificate, it would appear that the corpora- tion was organized about 1890, in April, and its capital in- 478 creased to $2,000,000 about the 14th of May, 1890. Is that about your recollection of it? — A. That is about my recollec- tion, except as to dates. Q. You thought it was somewhere about 1892? — A. Yes sir. Q. Was $2,000,000 the capital ?— A. Yes sir. Q. Were you and Mr. E. C. Benedict large owners of the capital ? — A. Yes sir. Q. The principal owners? — A. More than a majority' Q. Of the stock. You controlled the company, you two gentle- men? — A. Yes sir. BEADY. 233 Q. What business was the Manhattan Oil Company engaged in during the time you were connected with it?— A. Engaged in the purchase and sale of oils, manufacturing. Q. Did it have pipe lines ? — A. Yes sir. Q. In what State? — A. Indiana and Ohio. Q. In the North and South Lima oil fields?— A. Why, I am not familiar with the oil business. Q. Well, in the oil fields of Ohio and Indiana ?— A. Yes. Q. Did it also have a refinery ? — A. Yes sir Q. In Ohio?— A. Yes sir. Q. More than one? — A. Only one, I think. Q. One refinery in Ohio. Do you know where it was situated ?— A. A place called Welker. Q. Welker, Ohio. Did it also have tank-cars ?— A. Yes sir. 479 Q. A large number ?— A. Well, it depends on what you call a large number. Q. Well, how many, do you recollect ?— A. I don't remember. Q. Tank-cars were used for shipping oil to what places? — A. All over the United States, wherever they could sell them. Q. What was your object in constructing the Manhattan pipe lines and properties? — A. The principal object was to take care of the Chicago gas interests. Q. The principal object was to take care of the Chicago gas in- terests. That is the People's Gas & Coke Company, or whatever the name of it is? — A. Yes. Q. I do not know as the name is accurate. — A. It is now People's Gas Light & Coke Company. Q. How take care of it, IVJr. Brady? — A. Getting out a supply of oil at a reasonable price, and to make certain of the supph'. Q. That is, you wished to insure your i;as company a supply of crude oil at a reasonable price, and to be sure of getting the sup- ply? — A. Yes sir. Q. The surplus oil which the Manhattan Oil Company procured and piped was manufactured and sold? — A. Yes sir. Q. In the market? — A. In the market. 480 Q. Xow, with what companies and pipe line systems did the Manhattan Oil Company come in competition in its busi- ness ? — A. With every one else engaged in the same business. Q. With the Standard Oil's pipe lines? — A. Well, the Standard and every one else. Q. Well, what companies owned the principal pipe lines in Ohio and Indiana at that time? — A. I assume that the Standard did. Q. Well, did you have any doubt about it? — A. Well, I didn't have much doubt, no, but I didn't know anything about it. Q. You knew in a general way, didn't you? — A. Well, I assumed that without knowing. Q. Had you previously done business with the Standard? — A. No sir. 234 BRADY. Q. Of whom did you buy your crude supply ? — A. Bought it from producers and we produced ourselves. Q. What ? — A. We bought from producers, and we had producing wells of our own. Q. Through what pipe lines was it piped ? — A. Through our pipe lines. Q. Prior to the organization of the Manhattan? — A. I did not understand your question. Q. I say from whom did you get your supply of crude oil prior to the organization and construction of the Manhattan's 181 plant? — A. You are speaking now of the Gas Company? Q. Yes sir. — A. We got it from, I think, the Standard Oil Company. Q. The Standard Oil Company. Then it was against the Standard Oil Company that you sought to protect j^ourself, was it? — A. The Standard and every one else. Q. You sold out, did you, Mr. Brady ? — A. Yes sir. Q. You have been subpoenaed and requested to produce contracts and documents connected with this sale and with any arrangement with the Standard Oil Company. Have you produced any papers? — A. I have some papers with me, yes sir. Q. Will you let me see them, please ? — A. What papers do you wish to see? Q. Well, any papers in connection with this sale of the Manhattan Oil Company stock. — A. Here is a contract of sale to the General Industrials Development Syndicate, of London, England. Q. May I see it? — A. Certainly. (Handing paper to Mr. Kellogg). Q. This is an original document, is it, Mr. Brady? — A. Yes sir. Q. You want to keep it, I suppose ? — A. Well, I would like to keep it, if there is no objection. Mr. Kellogg. Very well. I offer it in evidence, and will read it, if Ml'. Brady wants to keep it. 482 Witness. Shall I send you a copy of it ? Mr. Kellogg. I think I can read it into the record and give it back to you. Mr. Rosenthal. Well, I object to it upon the ground that it is res inter alio actio. Mr. Kellogg. This contract reads as follows : " This Agreement made this 21st day of August, 1899, by and be- tween Anthony M. Brady, of the City of Albany, and the state of New York, party of the first part, and the General Industrials Development Syndicate, Limited, of London, England, party of the second [)art : Witnesseth : That the said party of the first part, in consideration of One Dollar to him in hand paid, and other valuable considerations, the receipt thereof is hereby acknowledged, hereby agrees to sell, assign, transfer and deliver unto the party of the second part, or his assigns, all the capital stock, consisting of twenty thousand shares, of BBADY. 235 the par value of One Hundred Dollars each, of the Manhattan Oil Company of Lima, Ohio, a corporation duly incorporated and exist- ing under the laws of the State of Ohio, within thirty days from the date hereof. In further consideration of such sale, transfer, assignment and de- livery of said stock by said party of the first part to said party of the second part, or his assigns, if the same be made, said party of the second part, for himself and his assigns, hereby agrees to take 483 over said company, its property and effects, subject to all its outstanding contracts and agreements and a bonded indebted- ness amounting to the sum of Eight Hundred Thousand Dollars and accrued interest, and to pay cash for the cash and cash assets of said company after deducting liabilities; and said party of the first part for value received hereby gives to the party of the second part, or his assigns, an option to purchase said stock within thirty days from the date hereof, at said agreed price. In Witness Hereof, the parties hereunto have set their hands and corporate seals the day and year first above given. The common seal of the General Industrials Development Syndi- cate was affixed hereto in the jiresence of H. jNIaxwell Johnson, Director ; J. M. Francis, Secretary." " Seal of the corporation." Q. That is the agreement under which you sold the stock, is it ? — A. Yes sir. Q. Have you any other document connected with that sale? — A. I have got the letter and telegram in which they accept the option. Q. That is the option contract? — A. Yes. Q. Will you let me see A. There is the cable, and there is the letter confirming the cable. (Handing papers to Mr. Kellogg.) Q. You received a cable from Mr. Johnson? — A. Yes sir. 484 Q. Is that the same Maxwell Johnson? — A. That, as I un- derstand, is Mr. Herbert Johnson. Q. Mr. Herbert Johnson? Was Mr. Herbert Johnson connected with the General Industrials Development Syndicate, Limited?— A. He was one of a firm of attorneys in London who represented them. Q. The concern?— A. In the negotiations. Q. Do you remember the firm as Budd, Johnson & Jecks?— A. Budd, Johnson & Jecks. Q. Jecks, is it?— A. Yes sir. Mr. MiLBUEN. J-e-c what? Mr. Kellogg. J-e-c-k-s. Q. Where is their address, do you know ?— A. Unless it is on their letterhead there. Q. Well, I guess it is somewhere.— A. Isn't it on the letterhead there, Mr. Kellogg? Q. Yes, I think it is.— A. (Referring to letter.) 24 Austm Friars, London, E. C. Q. Well, you received this telegram from Mr. Johnson, did you— this cable?— A. Yes sir. 236 BBADT. Mr. Kellogg. I offer the cable in evidence. Mr. Rosenthal. Well, same objection. It is res inter alio. Mr. Kellogg. I will read it : "August 31, 1899. London. To A. M. Brady, 54 Wall Street, N. Y. Syndicate accepts options. 485 John H. Cuthbert, its agent, will call on you to arrange details and payment. He has full authority. Johnson." Q. That is the cable, is it ? — A Yes sir. Mr. EIellogg. Now, I did not include in that cable all the printed matter on the cable. Mr. MiLBtTEN. Oh, no. Mr. Rosenthal. Well, we do not care particularly to have you do it unless you want to. Mr. I&!LL0GG. I did not suppose you did, Mr. Rosenthal. Q. This letter which you handed me was received by you, Mr. Brady? — A. Yes sir. Q. Is that Mr. Johnson's signature? — A. Well, I do not know; I think it is, but I am not sure. Q. You are not sure? — A. I assume it is. That is my recollection of his signature. Mr. Kellogg. I offer the letter in evidence. It is headed, Budd, Johnson & Jecks, together with the telephone addresses, which I do not suppose you care to have me read. Mr. Rosenthal. No. Mr. Kellogg. (Reading.) " 24 Austin Feiaes, London E. C, 29th September, 1899. Dear Sie : Referring to your letter of the 21st ulto., thinking that in addition to the cable accepting the options you would perhaps like to have duplicates of the option agreements sealed by the Syndicate, I have had this done and send them to you herewith. Yours faithfully, 486 Heebeet W. Johnson. To Anthony M. Beady, Esq., 5 If. Wall Street, New York City, V. S. ^." Q. Have you any other document in connection with that sale, Mr. Brady? — A. Oh, I have the letter of introduction which Mr. John- son brought to me when he first commenced the negotiation. Q. Mr. Johnson brought a letter of introduction to you, did he? — A. Yes sir. Q. From whom ? — A. Brown Bros. & Company, of 59 Wall Street, New York. Q. Will you let me see it, please ? (The witness hands letter to Mr. Kellogg.) Q. Did Mr. Johnson come to you with this letter of introduc- tion? — A. Yes sir. Q. Where did he come from, do you know ? From England ? — A. He came from England. BEADY. 237 Mr. Kellogg. I offer the letter in evidence, and will read it to the stenographer : " Beown Beos. & Company. 59 Wall Street, New York, July U, 1899 Anthony M. Beady, Esq., Manhattan Oil Company, 45 Broadway, New York, Deae Sie: We take pleasure in introdiicing to you Mr. Herbert W. Johnson, who has a matter of business to discuss with you. 487 Mr. Johnson comes to us very well recommended by our Lon- don house, Messrs. Brown, Shipley & Company, and he is a member of the firm of Budd, Johnson & Jecks, Solicitors, of London. Commending Mr. Johnson to your favorable consideration, we re- main, Yours very truly, Beown Begs. & Company." Q. Is that their signature, do you know? — A. Well, I dont know, but I assume it is. ^ Q. Well, Mr. Brady, was that sale carried out? — A. Yes sir. Q. Did you receive par for the $2,000,000 of stock. — A. No sir. Q. This contract provides that it is to be paid for at par; that is the Manhattan Oil Company? — A. I should have to look that up, Mr. Kellogg; I could not answer that question. Q. It provides the stock was to be sold at par, subject to the bonded indebtedness of $800,000 and accrued interest? — A. Well, then, I pre- sume that was the fact. Q. Do you remember whether those bonds were all turned over to them also ? — A. They assumed the bonds. Q. Well, didnt they actually buy the bonds also and pay for them? — A. Later on I think they did; that was not a part of the bargain. 488 Q. No, the contract provided for the assumption. Tehy also agreed to pay cash for the cash and cash assets of the company after deducting its liabilities? — A. Yes sir. Q. In addition to the $2,000,000 ?— A. Yes sir. Q. They did that, did they ?— A. Yes sir. Q. Do your books show, or have you any books showing the total sum paid by the General Industrials Development Syndicate Limited, for the stock, bonds and the cash and cash assets of this company ? — A. I have none of the books. Q. Can you find out for us? — A. I might, but I am not sure. I hardly know where to look. Q. Well, is it your recollection that the stock brought par? I want to get at that? — A. Well, I am not prepared to answer that question. Q. Well, can you find out about that?— A. I think so. Q. Is it your recollection that the bonds Avere afterwards pur- chased by some company and were paid for at par and accrued in- terest ? — A. That is my recollection, but I am not positive. 238 BBADT. Q. Can yon find out about that? — A. I can find out as far as relates to any bonds that I have. Q. Mr. Benedict has testified as to his bonds? — A. Yes. Q. Have you any way of finding out the cash and cash assets that they paid for? — A. Xo sir. Q. Now, Mr. Brady, will you tell us how you came to sell this prop- erty. Tell us the whole story, from beginning to end. — A. 489 Well, it is a short story. Those people came and wanted to purchase the property — this Mr. Johnson, for this Syndicate named here. And the stockholders were willing to sell the property provided the gas interests, particularly the People's Gas of Chicago, could be protected in a supply of oil for a long period, a term of years ; and it was finally arranged in that way. Q. Well, who protected the Chicago Gas? — A. Well, in my ne- gotiations with Mr. Johnson, they were always to give us someone entirely satisfactory to the Gas Company — a contract with someone; either to satisfy us that they were themselves responsible, or to give us a contract with someone whom we knew to be responsible. Q. Well, did j^ou get such a contract ? — A. Yes sir. Q. From whom? — A. The Standard Oil Company. Q. The Standard Oil Company ? — A. Yes sir. Q. Who procured that contract for you? — A. Mr. Johnson and his peojjle. Q. With whom did you have the negotiations for that contract? — A. For a contract, — not this particular one. Q. Yes, for a contract. — A. With Mr. Johnson. Q. Personally? — A. Personally. Q. Did you talk with Brown Bros, about it ? — A. No, I never met them in the transaction. Q. Mr. Herbert W. Johnson ? — A. Yes sir. 490 Q. Well, what did he say about procuring such a contract ? — A. He agreed that he would procure such a contract. Of course, he had to agree to that before avo would go ahead with the negotiations. Q. Well, you were not willing to take the contract of this syndi- cate of London, were you? — A. They didnt offer it to us. Q. They never offered it to you. You were not willing to take the contract of the Manhattan Oil Company, were you? — A. Of the Manhattan ? Q. Yes. — A. Why, if we had been running it, yes. Q. But I mean after it was sold. — A. Well, I dont Imow. That is a long time ago, Mr. Kellogg. I couldn't tell you what I thought then. Q. Well, you didn't take it, did you ? — A. No sir. Q. Didnt you insist on getting the contract from the Standard Oil Coni])any? — A. No sir. Q. Did he offer the contract of the Standard Oil Company? — A. Yes sir. T insisted on getting a contract that was entirely satisfac- tory to the gas interests. BEADY. 239 Q. For a long term of years? — A. For a term of years. Q. Have you that contract? — A. Yes, sir. Q. Have you it with you? — A. Yes sir. Q. ^I^ill you let me see it, JMr. Brady? (Witness hands paper to Mv. Kellogg.) Q. This contract purports to be signed by W. H. Tilford, 491 Do you know him? — A. No. Q. Did you have any negotiations with him for it? — A. No sir; I have never met Mr. Tilford. Q. Mr. Brady, this is an original, is it? — A. Yes sir. Q. You wish to keep this? — A. I should like to. I can send you a copy of it. Mr. Kellogg. I offer this agreement in evidence. Mr. MiLBUEN. Same objection. Oh, no, it is not. I will with- draw that objection. jMr. Rosenthal. The Standard Oil Company is a party to that. Mr. Kellogg. This agreement purports to run for ten years from the loth day of Xovember, 1899. Perhaps we had better have copies made of this, instead of reading it into the record. (Copies of this contract were made for counsel, and another copy was subsequently marked Petitioner's Exhibit 30.) Q. I notice by that contract that the contract was made early in November. Yi'as that about the time that this matter was closed up? — A. My recollection is not good on that, but I assume it is. Q. Did you receive the contract before you sold your stock, before j'ou finally parted with it? — A. I should say at the same time. Q. At the same time. Where did j^ou deliver your stock? — 492 A. It was delivered to the Central Trust Company. Q. Central Trust Company of New York? — A. Of New York. Q. You received your check from that company? — A. Yes sir. Q. Where did you deliver your bonds? — A. I do not recollect. Q. Now, did 3'ou have any negotiations with the Standard Oil offi- cials about this sale? — A. No sir. Q. I see by this cable accepting the offer, that the London com- pany, through Mr. Johnson, stated that Mr. John H. Cuthbert would call on you " to arrange details and payment; he has full authority." Did you see Mr. Cuthbert? — A. Yes sir. Q. Who was Mr. Cuthbert? — A. Mr. Cuthbert was, as I under- stood, an expert accountant. Q. With the Standard Oil Company?— A. He was not supposed to be with the Standard Oil Company at that time. Q. He was not supposed to be? — A. No. Q. Well, what makes you think he was not supposed to be? — A. Well, he denied being connected with them. Q. He denied being connected with them ? — A. Yes sir. Q. That is your only information ? — A. Yes sir. Q. You had not known Mr. Cuthbert ?— A. Didnt know him until he came to look into the statements and verify them. 240 BRADY. Q. Did you inquire of Mr. Cuthbert or Mr. Johnson whether the Standard was the purchaser ? — A. I didn't inquire from Mr. Johnson. I did sugoest to Mr. Cuthbert one daj' that perhaps they were. 493 Q. YeV.— A. He denied it. Q. He denied it. Did he say he was then in the employ of the Standard? Mr. EosENTHAL. Well, I object to any conversation between Mr. Brady and Mr. Cuthbert. A. He did not. Q. But yau did insist on having this contract from the Standard Oil Company guaranteeing you a supply for a long term of years, for your protection, before you would sell out to Mr. Johnson ? Mr. MiLBUEx. Now, Mr. Brady did not say that. A. No that is not quite right. Q. Well, what is the fact ? — A. I insisted on having a contract that would be entirely satisfactory to the gas interests. Q. Well, was any other contract suggested? — A. No sir. Q. None but the Standard Oil? — A. None but the Standard Oil. Q. And you got it? Mr. EosENTHAL. It is in evidence. Q. You were largely intei-ested (I am not going into the details of your private affairs) in the Chicago Gas, were you ? — A. Yes sir. Q. And that was why you wanted the contract? — A. Yes sir. Q. And your inlierest still continues? — A. Yes sir. 494 Q. And so, on that basis, you were willing to sell out the Manhattan. Now do you know that the Standard Oil Company was the purchaser? — A. I do not. Q. Have you learned it since ? — A. No ; not except what I have seen in the newspapers. Q. That is all you know about it? — A. That is all I have known about it. Mr. MiLBUEN. That is evidence to the contrary. Mr. EosENTHAL. That is only Mr. Kellogg's statement, anyway. Q. Well, had you known Brown Bros, prior to that time ? — A. In a general way, yes. Q. They are a banking firm of London and New York ? — ^A. Yes. In London the firm is Brown, Shipley & Company, and in New York, Brown Bros. & Company. Q. They are not in the oil business ? — A. Not to my knowledge. Q. Had you ever heard of the General Industrials Development Syndicate, Limited, before this? — A. No. Q. ^A^ien Mr. Johnson came to you, did he tell you about it? — A. I asked whom he represented, yes, and he told me who they were. Q. Did you make any inquiries about them? — A. No sir. Q. Had never heard about them before? — A. No sir. Q. Or Mr. Johnson ? — A. No sir. Q. What did he say about wanting to purchase this company? BEADY. 241 Mr. KosENTHAL. I object to that. 495 A. Do I answer? Q. Yes. Mr. EosENTHAi.. You have to answer, because there h no ruling upon these objections until we get into court. Witness. Well, my recollection is, in a general v/aj. he said he represented this Industrials Company, and that they were in the oil business, but wished to purchase a going company, with wells and land and cars and pipe lines. Q. And refineries? — A. Refineries. Q. Now, if he wished to purchase a going business, why did they sell their wells and tank-cars and refineries ? Mr. MiLBUEN. Does Mr. Brady know that? Q. Do you know? — A. Xo, I do not know that they did, Mr. Kellogg. Q. You dont know anything about it? — A. No. I am not in the oil business. That is my only venture. Q. Well, it appears in the evidence that they did sell their cars. — A. Well, I never knew that. Q. You never know anything about it? — A. No. Q. The Manhattan Oil Company, you thought, to do business properly, needed the wells for production — the refinery, and the cars, and the pipe line, didnt you ? — A. Yes sir. Q. And it appears that they have at least sold the cars^ that they have reduced their capital from $2,000,000 to $150,000. Mr. MiLBTjEN. Does that appear? Mr. Kellogg. Yes sir. It appears in the record. 496 Q. So it was evident that they did not care much for a going concern that would go a great while? Mr. MiLBTjEN. Why argue with Mr. Brady about this case? I object. Mr. Kellogg. I want to find out what he knows about it. Witness. I dont know anything about it, Mr. Kellogg. After I made my sale, I lost my interest in the transaction. Mr. MiLBUEN. That is just where you begin with a witness — where he knows nothing. Q. Why did you ask Mr. Cuthbert if he represented the Standard Oil Company? — A. Well, I think Mr. Benedict suggested that it was them, and I asked him out of curiosity, or some other reason that I dont remember now, to get the information if I could. Q. Didnt you object to selling to the Standard unless you got a contract protecting you? — A. Well, I would have objected to selling to any one else just as much. I had no particular — of course, we were competitors of the Standard to an extent. Q. Did you know that Mr. Cuthbert had represented the Standard Oil Company on the board of directors of the Tidewater Company at that time, for years? — A. No sir. .32555—08 16 242 BRADY. Q. Did y^ni know he was an accountant in their department? — A. Not at that time. I think I had heard afterwards that he had been an accountant and had left their employ at this time. Q. Did he examine the books and accounts and property of this company? — A. Yes sir. 497 Q. Did he arrange the price? — A. No, the price was arranged. Q. Did he arrange the details of payment of the price ? — A. Well, I dont remember. Q. For the cash and cash assets, I should have said. — A. He certi- fied to the amount of cash and cash assets, etc. Q. He did?— A. Yes. Q. Well, now, did he go out and look over the plant ? — A. Well, I assume so. The operating man was a Mr. Heym. Q. Mr. Heym, yes. If, according to this contract, the stock- holders sold all their stock, and afterwards the bondholders sold all their bonds, and the stockholders were also paid for the cash and cash assets, you must have some record of this cash and cash assets, and the amount thereof, havent you? — A. Why, I probably have got the amount that I received. Q. Well, the contract was made with you; you agreed to deliver all the capital stock? — A. Yes sir. Q. Did you get it all together and deliver it? — A. Yes sir. Q. Then did they pay for the cash and cash assets to you, or to each stockholder as his stock was delivered? — A. To each stockholder as his stock was delivered. That would be my recollection of it. Mr. Kellogg. I would like to have you find out, if possible, the amount received for all the stock, the amount received for the 498 bonds, and the amount received for the cash and cash assets of the company. Q. Now, have you any other agreements or contracts in relation to this sale at all ? — A. No sir. Q. No other papers in connection with it, that you know of? — A. Those are the only ones I have any knowledge of. Q. This is the only contract you received from the Standard ? — A. That is the only one. Mr. EosBNTHAL. That is, that People's Gas Light & Coke Com- pany? Mr. Kellogg. Yes ; I am speaking about the contract between the Chicago Gas, or whatever you call it, and the Standard Oil Company of Indiana. That is the only contract you received? Witness. Yes sir. From the Standard? Q. Yes. — A. Well, I have other companies that have other con- tracts. Q. Well, did you receive any other about this time? — A. None other on that basis, if that is what you mean. Q. Yes. You received no other contracts about the time of this sale? — A. Well, I wouldnt say that. LOMBARD. 243 Q. As a condition of this sale?— A. No, not as a condition of the sale. I may have made other contracts. Q. What is that?— A. There may have been other contracts at that time, but not as a condition of that sale, and not on 499 the same conditions. In other words, the companies are ex- piring from time to time, and I couldnt say but what some other company expired at that time. (No cross-examination.) Mr. KJ5LL0GG. If you will wait just a moment, I will give you back that contract. Mr. Brady. All right, sir. (Mr. Kellogg handed the original contract back to the witness, and a copy of same was marked Petitioner's Exhibit 30.) 500 JosiAH LoMBAKD Called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct examination by Mr. Moeeison: Q. Whsit is your name ? — A. Josiah Lombard. Q. Where do you live ? — A. Bronxville, New York. Q. How long have you lived in New York ? — A. 40 years. Q. In what business are you engaged? — A. Refining petroleum. Q. How long have you been engaged in that business? — A. About thirty-eight years. Q. With what company are you now associated? — A. The Tide- water Oil Company. Q. How long have you been connected with that company? — A. Since its organization, in 1888 I think. Q. Were you connected in any way with the Tidewater Pipe Com- pany ? — A. Yes, I was. Q. When did you first become associated in any way with that company? — A. At its beginning; I think it was in 1878 or 1879. Q. Before that had you been a member of any firm or association or corporation engaged in any branch of the oil business ? — A. I was a member of the firm of Lombard & Ayres. Q. Were you a member of any other firm in which your 501 name appears ? — A. Afterwards, or then ? Q. At any time. — A. Lombard, Stevens & Company, years before. Q. Anybody else? — A. Afterwards the corporation of Lombard, Ayres & Company. Q. There never was a partnership or association which went by the name of Ayres, Lombard & Co. ? — A. No, that is a mistake. Q. That is a mistake. Well, when you first commenced in the oil business, what branch of it did you carry on? — A. First bringing crude oil to New York and selling it to exporters. Q. That was in what year? — A. 1866. Q. Were you exporting crude oil ? — ^A. Selling it to exporters ; we didn't export it ourselves. 244 LOMBAED. Q. You didn't refine it; you sold the crude. — A. Not at first. Q. How long before you established a refinery? — A. In 1869, I think it was. Q. What was that called? — A. I dont remember the name of it. We simply furnished the money and rented a refinery. Q. ^Vhere was it located? — A. Newtown Creek. Q. Where did you get your oil from? — A. Brought it in over the Erie Railroad. Q. How was it shipped at that time ? — A. In barrels. 502 Q. In barrels ? — A. Mostly. I believe there were a few tank cars at that time — wooden cars. Q. Wooden tank cars? — A. Yes. Q. Were there other people in the business at that time? — A. Oh yes, quite a number. Q. Who were they that you remember? — A. Cozzins & Co. were the largest refiners in New York at that time. Q. What became of them ? — A. They failed afterwards. Q. Who got their plant, do you know ? — A. Ultimately the Stand- ard Oil Companjr. Q Who else? — A. Rockefeller, Andrews and Flagler were large shippers of refined oil from Cleveland. Q. Now that was at what time?— A. That was in 1866 to 1869, along that time. Q. Well, their business was finally merged, was it not, in the Standard Oil Company of Ohio? — A. Yes. Q. Now, can you give us any more refineries that were doing busi- ness in New York at about that time? — A. S. Jenney & Son were I think at that time. Q. What became of them? — A. They finally merged with the Standard Oil Company. Q. When ? — A. Oh probably about 1880, or something of that sort. Charles Pratt. 503 Q. How is that? Charles Pratt & Company? — A. Charles Pratt was in business then. Q. Well, what became of that company? — A. Well, after some changes it was finally merged with the Standard Oil Company. Q. Do you know what the changes were ? — A. It became the Devoe & Pratt Manufacturing Company, at one time. Then it was resolved back again into I think Charles Pratt & Company. I am not quite clear about that. Q. Who were the members of that concern? — A. At that time Charles Pratt was the only one I knew. Q. Charles Pratt?— A. Yes. Q. Later on, did you become acquainted with any one associated with it ?— A. H. H. Rogers. Q. When was Rogers in that firm, and when did he leave it? — A. I couldn't tell you ; I don't remember dates. Q. When did that concern become a part of the Standard Oil Com- pany of Ohio? — A. Neither do I remember the date of that. LOMBARD. 245 Q. Can you tell us about when it was ? — A. I don't believe I can. Q. Was it before or after 1870? Mr. MiLBTjKN. What firm was this? Mr. MoEEisoN. Charles Pratt & Company. Mr. MiLBTJEN. You are asking when it became a part of the Stand- ard Oil Company of Ohio? Witness. Did you ask the Standard Oil Company of Ohio? Mr. MoKEisoN. Yes. Witness. I don't think they ever were a part of that. 504 Q. Did the individual members of that firm become con- nected with the Standard Oil Company? Mr. Rosenthal. Do you know anything about this, Mr. Lombard, of your own knowledge? Witness. I don't know anything about it, of my own knowledge, of the dates. Q. The dates you don't know about? — A. I don't know anything about the dates. Q. You do know who was doing business here at that time, don't you, Mr. Lombard? — A. Yes sir. Q. Do you know whether H. H. Rogers afterwards became a mem- ber of the Standard Oil Company of Ohio ? — A. I don't know about that. Q. Was he connected with the Standard interests afterwards? — A. Yes. Q. And has he been ever since? — A. Yes. Q. What other companies were there doing business in New York prior to 1870 ? — -A. J. A. Bostwick. He was not refining here, but he was bringing refined oil here. Q. What was he doing? — A. Bringing refined oil from Cleveland and selling it in this market. Q. Selling it in the market? — A. Yes. Q. For export? — A. For export, almost entirely. Q. Well, what became of that concern? — A. It was merged with the Standard Oil Company, after many years. 505 Q. At about what time? — A. I couldnt tell you. Q. Could you tell whether it was before 1880? — A. Yes, I am very sure it was before 1880. Q. Was he afterwards one of the principal managers of the Stand- ard Oil Company? — A. Yes sir. Q. He is dead, is he not? — A. Yes sir. Q. Well, what other companies were doing business in New York at that time? — A. There were a number of small refineries in the home trade. Woodruff & Houston. There were a number of others whose names I don't recall. Q. What became of them?— A. They all went out of business when the tax was removed. Mr. MiLBURN. When what? Witness. There was a revenue tax on petroleum sold to the home trade at that time. 246 LOMBAKD. Q. Well, what had that to do with these men you are talking about ? — A. I dont know ; I suspect that a good many of them didnt pay the full tax. Q. Oh, and that the government got after them ? — A. No, when the tax was removed there was no busines for them. Q. Oh, yes. Well, were there any others who afterwards became associated with the Standard? — A. James Donald & Company. Q. Was that a partnership or a corporation ? — A. A partnership at that time. 506 Q. T\^en did that become a part of the Standard Oil? — A. That I couldnt tell you. Q. Before 1880 ? — A. I shouldnt be sure of that. Q. Any others? — A. I dont think of any at the moment. Q. Dicl you have occasion to ship much over the Pennsylvania railroad ? — A. Yes, at various times, a good deal. Q. And over any other railroads ? — A. Over the Erie and the New York Central. Q. You used those three roads principally, did you not? — A. Yes, entirely, with Q. Those roads at that time tapped the oil fields, did they not? — A. They were the only ones that did that came to New York. Q. There were no pipe lines in those days, were there ? — A. None. Q. That is, no through trunk lines. — A. No; even no gathering lines at first. Q. Do you know or remember when the Standard commenced to acquire the refineries at Cleveland ? — A. I cant give any dates. Q. Can you tell about the time, Mr. Lombard? — A. I dont think I could. It would be too indefinite. Q. Do you know what refineries there were there in the esirly seven- ties? — A. I do not. Q. Do you know when they commenced to acquire the refineries at Pittsburg? — A. I know that no better. 507 Q. Or Philadelphia ?— A. No. Q. You always did business in New York City? — A. Always in New York City. Q. Do you know anything about when they acquired the refineries in the oil regions about Titusville ? — A. I do not. Q. Do you remember what the freight rates were on oil early in the seventies, 1870 to 1872?— A. Early in the seventies? Q. Yes. — A. I dont, exactly. They were very high; $3.50 part of the time. Q. Over what railroad? — A. The Erie. Q. Do you know whether you got the same rates that the Standard people got during that period? — A. I think at that time I did. Q. Up until what time? — A. I couldn't give you the exact date, probably 1873 or 1874, somewheres along there. Q. Do you remember the South Improvement Company? — A. I do. LOMBAED. 247 Q. Do you know the gentlemen who were connected with that company? I will give you their names. Mr. MiLBUEN. The South Improvements Company! It seems to me I have heard of it. Q. You knew Mr. John D. Rockefeller, did you ?— A. Yes. Q. I am giving you now the members of that company. William Rockefeller?— A. Yes. Q. O. H. Payne?— A. Yes. 508 Q. H. M. Flagler?— A. Yes. Q. W. G. Warden?— A. Yes. Q. O. F. Waring?— A. Yes. Q. And William Frew ?— A. I didn't know him at all. Q. Were these gentlemen that you say you did know connected with the Standard Oil Company ? Mr. MiLBUEN. When? Witness. Some of them. I am not sure whether the Standard Oil Company was in existence at that time as the Standard Oil Company. Q. Well, at some time or other, did they become connected with that A. Yes. Q. The Standard Oil Company was organized in 1870. Mr. Rosenthal. January 1st, 1870. That is the Standard Oil Company of Ohio. Mr. MoEEisoN. Yes ; that is the parent company. Q. Do you remember when that South Improvement Company contract was made? — ^A. I don't remember the date, sir. Q. You remember the circumstance, do you? — A. I remember the circumstance very distinctly. Q. How did you learn about it? — A. I was first notified by Mr. Vanderbilt that the freights on some oil that we had in transit would be advanced. Mr. Rosenthal. Well, I object to any notification he may have got from Mr. Vanderbilt, on the ground that it is immaterial. Witness. That is the way I learned of it. 509 Q. Well you say you did know about that? — A. Yes, sir. Q. And you learned it from Mr. Vanderbilt ? — A. First, yes. Q. Who was Mr. Vanderbilt ?— A. Wm. H. Vanderbilt. Q. Was he coimected with any railroad company? — A. President of the New York Central. Q. And was that railroad company carrying oil to you, at the time? — A. It was. Q. Did you learn what the terms of that contract were? — A. Later I did ; not then. Q. How did you learn of it ? — A. I really don't remember. Q. Well, how long after this contract went into force was it that you learned its terms ? — A. Oh, very soon afterwards, not many days. Q. Well, was there much excitement about that contract, in the oil country? — A. A very great deal. Q. How is that? — A. A very great deal; great excitement. Q. There was?— A. Yes. 248 LOMBARD. Q. Was there any change in the rates shortly after that contract went mto effect? Mr. EosENTHAL. Well, I object to that. It does not appear in evidence yet that that contract ever went into effect or that there was any contract. Mr. MoRESON. You admit that there was a contract? Mr. Rosenthal. We do not. Mr. Kellogg. You admit it was executed. Mr. MoKEisoN. Your answer admits that. 510 A. There was an immediate change. Q. "V^^iat was that change? — A. I don't remember. It was a very large advance; I don't remember the amount. Q. Did you know that this contract provided for a rebate of nearly 50 per cent on all oil shipped by the Standard people? — A. I did not, at that tinae. Q. Did you learn it afterwards? Mr. Rosenthal. AVell, I object to that upon the ground that the contract itself is the best evidence of what its terms are. A. I may have learned it, but I don't remember it. Q. Did you have any conversation with Mr. Vanderbilt or with the officers of any other railroad about it? — A. I had a great many conversations with Mr. Vanderbilt. Q. "What did he say about it? Mr. MiLBiTRN. "'lYell now I object to that as hearsay. I should think there should be some rules of evidence observed here. A. He said the rate must be enforced. Q. Wliat did you say to him? — A. I refused to pay it. Q. Did he give any reason to you why he claimed the rate should be enforced? — A. Because — nothing except that that was the rate. Q. Was the Standard mentioned in that conversation? — A. No. Q. \Yas it in anj' conversation with him in reference to the South Improvement Company? — A. No. 511 Q. Did you at that time know who the members of the South Improvement Company were? — A. I did not. Q. Did you at any time learn who got the benefits of the provisions of that contract ? — A. I don't know that I did. Q. Don't you know whether Rockefeller and these men Mr. MiLBURN. Oh, he says he doesn't know. Q. And that these men were members of the South Improvement Company? — A. Yes. Q. You knew that, did yon? — A. Yes. Q. How long did the rates continue up at a high point as you say after the making of this South Improvement Company contract? — A. It could not have been long. We didn't pay the advanced rates at all. We refused to pay them and never paid them. Q. You refused to pay them and did not pay them ? — A. Yes. Q. Do you know whether at any time the Standard Oil Company got control of the terminals of these railroads ? — A. Yes, they did get control. LOMBAED. 249 Q. About when did they get control of the different terminals of these different railroads? — A. I think it was in 1878 that they bought out the Empire Line and thereby got control of the National Storage Company. Mr. EosENTHAL. Of what? Mr. MoKEisoN. Of the National Storage. Witness. I don't know when they got control of the Erie ter- 512 minal at Weehawken. They got control of what there was of the New York Central terminal when J. A. Bostwick went into the Standard Oil Company. Q. How long did they have control of these terminals? — A. I dont know. Q. Have them yet? — A. They may have them yet; I dont know. Q. You dont know about that. While they had control of these terminals of these railroads, all oil shipped over these railroads had to be handled by them, did it r.ot, whether it was shipped by the Standard Oil Company or by other companies? — A. Yes, it all went through those yards. Q. All went through the yards? — A. Except what came by canal. Q. Yes. Of course what came by canal didn't go through those yards? — A. And I think some refined oil was shipped over the New York Central road to 30th Street, which was not one of the regular terminals. Q. Well now, what if any advantage would the possession of these terminals irive the Standard Oil Company? — A. Nothing except a knowledge of the business and what money they could make out of it. Q. What is that ? — A. And what money they could make out of it. Q. Well they could fix terminal charges, couldn't they? — A. Yes, but there was a regular scale. 513 Q. Well who fixed that?— A. I don't know. Mr. Morrison. If it is satisfactory to The Examiner, we will stop at this time until two o'clock. The Examinee. Well, I suppose you have some purpose in it. Is it because you are not ready to go on ? Mr. Morrison. We can get in better shape I think. The Examiner. I don't like to lose time unless we can gain time. Well we will stand adjourned until two o'clock. Afte]!noox Session. The hearing was resumed at two o'clock, P. M. JosiAH Lombard, recalled as a witness on behalf of Petitioner, testi- fied as follows: Direct examination (resumed) by Mr. Morrison : Q. Did you have a conversation with Mr. John D. Rockefeller and some other person or persons representing the Standard Oil Company in reference to a sale of the Tidewater refineries?— A. Yes. Q. When was that?— A. I think it was in the summer of 1882. 250 LOMBABD. Q. In the summer of 1882. Was that before or after this meeting of the stockholders of the Tidewater companies in which the minority sought to get control of the company ? — A. Before. Q. How long before that meeting? — A. I think this was in 514 the summer of 1882 and the other the winter of 1883, about sis months before it. Q. You dont remember the exact date of either of those occur- rences? — A. I do not. Q. Well, did your talk with those gentlemen result in any arrange- ment A. It did not. Q. Or sale of the property? — A. It did not. Q. Who was talking with you besides Mr. Eockefeller? — A. Mr. Ayres, my partner, and Mr. Archbold. Q. Mr. Eockefeller and Mr. Archbold? — A. Yes sir. Q. Talked with you and Mr. Ayres? — A. Yes. Q. Were there any prices set or talked about on that occasion? — A. They asked us, after a little talking, if a million dollars would tempt us. Q. How much? — A. A million dollars, to sell out; that was Lom- bard, Ayres & Company. We told them Yes, that the price was satisfactory, but we could not desert our associates, the Tidewater Oil Company. Q. Go right on with the conversation. — A. We told them we were bound to them and we could not sell out unless they did, unless the whole interest went together. They said, " Well, what will the whole interest take? " We said, " We dont know, we will see." So we went down and met as many of the directors of the Tidewater Oil 515 Company as were in New York at the time, and talked it over. The general sentiment was that five million dollars would buy out the whole concern. Q. That would be both companies? — A.~Both companies, ours and the Tidewater Pipe Company. But Mr. Taylor Q. Now, what Taylor was that ? — A. H. L. Taylor. He was very high priced, very mighty about it. He said he wouldn't take less than eleven or fifteen millions, I don't know which it was. Q. Eleven or what? — A. Eleven or fifteen millions; I dont re- member which sum it was. The others were in favor of offering at five million dollars. Q. Well, was five millions, do you think, a fair price for the prop- erties? — A. A very fair price. Q. Now, is this the same H. L. Taylor who attended that meeting and who voted his stock in favor of electing the minority represent- atives of the Tidewater Company ? — A. The same one. Q. The same one? — A. Yes. Q. And the stock he represented is the same stock, is it not, that finally got into Mr. Cotton's hands ? — A. Yes sir. Q. Then into Mr. Cuthbert's; is that right? — A. Yes. Q. And then into Mr. Folger's?— A. Yes. LOMBAED. 251 Mr. MiLBtJRN. Do I understand that Mr. Lombard says that Mr. Taylor that you are talking about was at this time acting for the Standard? 516 Mr. MoEEisoN. Well he don't say anything on that subject. That question has not been put to him. Q. Prior to 1878, crude oil was brought from the fields, or a part of it, over the Pennsvlvania Railroad, was it not? — A. A large part of it. Q. Do you know anything about the Empire Transportation Com- pany? — A. Yes. Q. What railroad was that company connected with? — A. The Pennsylvania. Q. Did you have any contract or arrangement with that company for A. We did. Q. And when did that expire? — A. If I remember rightly, the first of May, 1878 ; about that time. Q. Do you know whether or not there was a war made on this Empire Transportation Company? — A. There was. Q. What became of it finally ? — A. Finally the Empire Transpor- tation Company sold out. Mr. Rosenthal. Have you any personal knowledge of what you are now talking about? Witness. My personal knowledge, yes. Mr. MoEEisoN. Yes, he knows all about it. Q. Go on. — A. Finally the Empire Transportation Company was sold out. Q. To whom? What became of its property? — A. It was sold to the Standard Oil Company. 517 Q. Who, if any one, carried out the contract which you had with that company? — A. The Pennsylvania Railroad. Q. Did you have any controversy with Mr. Cassatt about rates? — A. Yes. Q. "W'Tien was that? — A. Soon after this sale we met Mr. Cassatt here in New York. Q. Who was Mr. Cassatt? — A. Pie was, I think, the third vice- president of the Pennsylvania Railroad at that time. Q. At that time. Did he afterwards become president of the road? — A. Yes. Q,. Who was present at this conversation ?— A. Mr. Bush, Mr. Ohlen, Mr. Gregory, and I am not sure — and myself. I am not sure — there was somebody else, but I am not sure who it was. Q. Mr. Burke ?— A. Mr. Burke, yes. Q. And in whose office was it held?— A. Mr. Bush's office. Q. Who sought that interview? — A. Mr. Cassatt, he made an ap- pointment with us. Q. How is that? — A. Mr. Cassatt made an appointment with us. Q. Well did he apply to you for an interview or did you apply to him first? — A. He applied to us, as I remember it. 252 LOMBABD. Q. Now you may state what was said at that interview by all of you gentlemen. Mr. EosENTi-iAL. Well, we object to it on the ground that it 618 is hearsay, made out of the presence and hearing of any of the parties to this suit. Q. Go ahead. — A. He told us that the Empire Line had been sold, and sold to the Standard Oil Company. We asked him what would be the result so far as we were concerned, that we had been the largest shippers over his line, which he acknowledged, and he said we could make some arrangement with the Standard Oil Com- pany which would be satisfactory to all concerned. We didn't want to do that. Q. State what you said to him? — A. I don't know as I can remem- ber that. I think I said we dealt on freight matters with the Penn- sylvania Railroad and with the Empire Line, not with the Standard Oil Company, or something to that effect. Mr. Rosenthal. Is " we " the Tidewater Company or Lombard & Ayres ? Witness. No, " we " was Lombard & Ayres and the other members of the refining companies which I have mentioned, three or four of them. -3 Q. Go right on and give the conversation. — A. He said as things were now that couldn't be done; that the Standard having bought the cars we should have to deal with them. I don't know, it was either at this interview or the next, I don't know which, T told him that we would prefer to deal with him. He said " go to them, you can make a good arrangement with them." And we talked it over for a long time and came to no decision. I think it was at that 619 interview that I asked him if we would ship as much oil as the Standard Oil Company whether he would give us the same rates of freight. He said he would not. I asked him why. Well, he said because the Standard was the onl}' company that could make peace between the railroads. Now, you understand this may be at this interview or the one succeeding it. but this was the converHation. tion. Mr. Rosenthal. AATiat was the date of that interview ? Witness. I could not tell you; it was soon after the sale of the Enquire Transportation to the Standard Oil Company. Mr. Rosenthal. That was in 1877. Witness. Some time in 1877, I think ; in tlie spring I think. Q. Go right on and tell all that was said. — A. AVell I have two interviews mixed and I may put them — may give you part of the conversation Q. How far were they apart? — A. A couple of months, probably. And he said " No, that the Standard Oil Company was the only com- pany that could make peace between the railroads." I told him that it seemed to me that the railroads had the matter in their own hands, the oil had to come forward. There were but three of them; didn't see why they needed to call in a third, fourth or fifth party to make LOMBAED. 253 peace. He said thej' couldn't depend upon each other. And I asked him if the Standard would have any advantage over us. He 520 said " Very little, you would hardly notice it." I dont remem- ber much more of that interview. Q. Do you remember anything else now in that conversation? — A. I do not, at the moment. Q. Did he, in that conversation, say that it would not be satisfac- tory to the Standard Oil Company if they should give you the same rate A. Yes. Q. That he gave the Standard Oil Company ? — A. Yes sir. Q. You said to him that you didnt see how it was necessary to ask the Standard Oil about these things or to make an arrangement with them?— A. I did. Q. That there were three or four of you parties. To whom did you refer? — A. I referred to the railroads, the New York Central, the Erie and the Pennsylvania Central. Q. Did he say in that conversation that they had been bringing oil for the last year at very low rates ? — A. Yes. Q. What did you reply ? — A. I replied that I understood that they had received about 70 cents a barrel. It seemed to me a fair rate. Q. '\¥hat did he say about that? — A. Well, I think he afterwards admitted it was a, fair rate. Q. Well, did he say whether or not they had received that rate? — A. I dont know whether he did or not at that time. He admitted it afterwards. Q. He afterwards admitted that they had ? — A. Yes. 621 Q. That that had been the rate? Did he say, in that con- versation that the rates on petroleum were proj&table? — A. He said they were very profitable. Q. Did he say that they could find out what it would cost to bring petroleum, if they were compelled to, by looking up their annual reports and seeing the cost per ton per mile? — A. Yes. Q. Did you say to him at that time whether you objected to their making a good p)rofit on the oil? — A. I told him we did not object at all if they were making a good profit. Q. Did you say to him in that conversation that all you wished was to have as low a rate as anybody else ? — A. Yes. Q. And did you say that you could not get it? — ^A. Yes. Q. "What did he say to that? — A. Well, he said the difference would be very small, we would scarcely notice it. Q. Well, did he tell you what that difference would be? — A. I don't remember whether he did or not. Q. Was anything said about what rate you should have, in case you shipped as much over the railroads as anybody else did ? — A. He said we could not have the same rate as the Standard. Q. Just give the language, as nearly as you can, upon that subject, what you asked him and what he said about it. — A. I asked him if we shipped as much oil over the road as the Standard Oil Company 254 LOMBABD. whether we could have the same rate, and he said, " No ". I 522 asked him why, then he told me that nobody but the Standard could make peace between the railroads. ]\lr. MiLBUKN. That is the third time already that he has testified to that. Witness. This is reiterating the conversation, simply. Q. Now, was there anything else said that you remember of in that conversation? — A. No, nothing that I can recall now, 28 years ago you know. Q. Was there anything said about your making any arrangement with the Standard Oil Company? — A. Oh, yes, I think I said that early in the Q. Was there anything said as to whether this discrimination against you would be larger if the rate of freight was high than it would be if the rate of freight was low? — A. Yes. Q. What was said on that subject? — A. It would be a larger dis- crimination the higher the freight was. Q. Was there anything said in that conversation about your uniting your interests with the Standard? — A. He urged us to do it. Q. Now, tell us what he said as near as you can. — A. I can't re- member the exact words, but it was to this effect : that if we would unite with the Standard, everything would be harmonious and pleasant. Q. Well, " unite " with them ? — A. Join with them. Q. Explain what he meant by that ? — A. I suppose he meant go in with them, in business with them, associate ourselves with 523 them. Q. What did you say to him in reply to that? — A. We didn't want to do it. Q. Now, you have given the conversation which you had at both of these meetings, have you ? — A. Pretty much ; I think all of it. Q. Were they both held at the same place? — A. No, one was held in Pearl Street, in the city, Mr. Bush's office; the other was held in the office of the Pennsylvania Railroad Company in Philadelpliia. Q. Did you have any trouble about getting cars to transport your oil? — A. Very great trouble. Q. When did that trouble commence ? — A. I think in May, 1878, 1 think that was the date, after our contract with the %Empire Line had expired. Q. Now, you may go on and tell what trouble you had to get cars. — A. Well, we applied for cars, about thirteen or fifteen cars a day, and I think we got three or four. Previous to that we had had a full supply. Q. Did you have any talk with Mr. Cassatt about that? — A. Yes. Q. When was that? — A. That was at the interview at Philadel- phia. Q. That was this same interview that you have been talking about? — A. Yes. 524 Q. What did he say ?— A. He said that they could not fur- nish us with cars, that they hadn't the cars, didn't have enough. LOMBAED. 255 And then we, by some means, had found out that there were some five hundred cars standing at Philadelphia at the time— Philadelphia, I think it was. We asked him about that, and he said he didn't know anything about that ; he said he would have that rectified. Q. Well how did you learn that those care were standing there?— A. We saw them first, and then by investigation found out that they had been standing there for some time, loaded. Q. What else if anything did you say to him about those cars stand- ing there on the side tracks ? — A. We told him we thought he scarcely ought to give any more cars to people who left them standing like that without distributing them to people who could use them. Q. Was anything said in that conversation about your building a pipe line? — A. Yes. Q. "What was said about it?— A. Mr. Bush suggested that we should build a pipe line. Mr. Cassatt said if we did he would prob- ably buy it for old iron in less than sixty days. Q. Did you make any reply to that ? — I dont remember. Q. Did you have an interview with Col. Scott, the president of the Pennsylvania Railroad, about that time? — A. Yes, later than that. Q. When was that?— A. That was in the summer of 1878 I suppose. 525 Q. Who was present at that interview? — A. On the Penn- sylvania road there was Mr. Cassatt and Mr. Scott, and from New York here I think Mr. Bush, Mr. Gregory, Mr. Ohlen, and I don't remember any one else. Q. Was Mr. Brundred there? — A. Mr. Brundred was there, yes. Q. Was anything said in that conversation about scarcity of cars? — A. Yes. Q. What was said? — A. We told him we were not getting any- thing like the cars we ought to have, and his contention, as I remem- ber it, was that we were getting our share of the allotment. Q. What did you say to that? — A. We told him previous to this trouble we had had all the cars we wanted and we didn't see why we should not have what cars we needed now. Q. Previous to what trouble? — A. Previous to the sale to the Em- pire Line. Q. Anything else said in that conversation? — A. He said that if other orders were in ahead of us we ought not to have it ; and he asked if I expected to have all the cars I wanted no matter what demand there was. I told him yes, within a reasonable time, as we always had had. Q. Go right on. — A. Well, I don't remember very much more at that moment. Q. Did you say anything in that conversation about build- 526 ing cars of your own ? — A. Yes. I said, " If we build cars of our own, will you transport them and give us our cars?" He said No, he would not. 256 LOMBAED. Q. Did he say anything else on that subject? — A. Col. Scott said they had had trouble enough buying out one company without getting into more trouble buying out another one that came on the road. Q. Did you make any proposition about selling him your cars at that time? — A. We had about 40 cars at that time; we offered to furnish those. Q. Well you hadn't said anything about selling them to him, had you? — A. I don't remember. I think we did, but I don't remember. Q. What did he say about that? — A. He told me, — that is what he said, that he had trouble enough with one company. Mr. Rosenthal. Who was this you were talking to? Mr. Morrison. Thomas Scott. Q. Did Col. Scott say anything to you about your uniting with the Standard? — A. Yes. Q. What did he say? — A. He said if we would unite with the Standard everything would be in good shape. Q. What did you say in reply to that? — A. We told him that we didn't want to deal with the Standard in transportation matters; we wanted to deal with the Pennsylvania road. Q. Was there anything said about your applying to other railroads for transportation? — A. Yes. 527 Q. What was said about that? — A. He asked me why I didn't apply to other roads. Q. Wliat did you tell him? — A. I told hina I had already. Q. Anything else that you told him ? — A. He asked me what roads, and I told him (there were only two others of course) — I told him I applied to the New York Central and they said they had no cars, and Mr. Rutter who was president of the road at that time was rather indignant at me. He said " You don't mean business." He said " You just come here to involve us in trouble with our largest shipper." I told him that was not so, we wanted the cars; we wanted 100 cars. Well, he said " I will do what the law compels me to, noth- ing more and nothing less." Q. Are you stating now what you said to Col. Scott ? — A. Wliat he said to me. Q. Or are you telling a conversation you had with Mr. Rutter? — A. I am telling what Mr. Rutter said to me. Q. Well, I was asking you about your further conversation with Col. Scott. — A. Oh, I simply told him we had applied to these other roads and could not get the cars. Q. Was there anything said in that conversation as to whether or not the Standard Oil Company controlled the transportation of oil at that time over the railroads? — A. I don't remember. Q. Now, you spoke about having a conversation at one time 528 with Mr. Rutter. Who was Mr. Rutter?— A. The president of the New York Central road at that time. Q. When was this conversation ? — A. It was in 1878 ; it must have been before this interview with Mr. Scott. LOMBAED. 257 Q. Was he President or was he connected with the freight depart- naent?— A. I think he was president; but it is possible that he was— I thought he was president ; I am not sure. Q. Well, he was connected with that railroad?— A. Oh, yes. Q. Now, what did he say to you and what did you say to him I Mr. Rosenthal. Well, that is objected to. A. He said that I was trying to get him into trouble with his largest shipper. Q. Well, what had you said to him that caused him to say that? — A. I asked him for 100 cars to transport crude oil in. I told him that that wasn't so, that this was simply a matter of business, that I wanted the cars and had the oil for them. And he was pretty indig- nant, for some other reasons, and he said, " I wiil do what the law compels me to, nothing more and nothing less." I asked him what the law compelled him to do, and he said he wasnt going to give me any information on that subject. Q. Did you get the cars ? — A. We didn't get the cars. Q. Did you apply to any other railroad for cars? — A. I applied to the Erie. Q. With whom did you talk?— A. AVith Mr. \'ihi^^ Q. Now you may give that conversation. Mr. Rosenthal. Same objection. 529 A. I asked him, I think, for sixty cars, or something of that sort. I told him I had the oil for them ready to ship ; and he said I should have to apply to Charles Pratt & Company for cars. Q. Go right on. — A. I told him I didnt see what Charles Pratt & Company had to do with it; I applied to the Erie Road for cars on that line. He said he couldnt give them, that I would have to apply to Mr. Pratt. Q. Well, did he say anything about whether Pratt had some pre- vious order in? — A. Yes. And I think I asked him whether that order wasn't given after I applied for the cars. Q. What did he say to that? — A. He didn't answer it. I didn't get the cars. Q. Have you now told all that was said at that interview ? — A. All that I remember. Q. Who were present besides you and this gentleman? — A. Mr. Vilas? Q. Yes, Mr. Vilas. — A. No one. Q. Where did that conversation take place? — A. Down at the foot of Duane street, the Erie Building. Q. At his office?— A. At his office. Q. Well, did you succeed in getting cars from him ?— A. No. Q. Did you succeed in getting sufficient cars from any of these railroads to transport your stock ?— A. No, but we got more cars after that than we had had before. We didn't get enough. 530 Q. What, if anything, were you compelled to do to get your oil transported? — A. We built some canal boats to run on the Erie canal. 32555—08 17 258 LOMBARD. Q. Just go on and describe everything that was done in reference to that canal enterprise. — A. And built some cars to riin over a little cross road, New York, Buffalo and Pittsburg, I think, from the oil regions at Buffalo, and we built a yard in Buffalo to receive the oil and shipped via Buffalo to New York, by canal boat from Buffalo. Q. Then you got your oil by rail to Buffalo? — A. By rail to Buf- falo, and from there by canal to New York. Q. Did you build any boats to transport your oil on? — A. Yes, built twelve. Q. Twelve canal boats? — A. Yes sir. Q. Now, when was that? — A. That must have been in 1879, prob- ably, about that time. Q. Was that before the Tidewater Pipe Line Company had started to build its line? — A. Yes. Q. Before that? — A. They were planning it, but ii hadn't begun. Q. Was there a pipe line known as the Equitable at that time ?— A. Yes. Q. Where was that? — A. That was near Bradford. That little line was built to supply these cars and canal-boats of ours and the other New York refiners. Q. Where did it begin and where did it end ? — A. It began at 531 the wells and ended, I forget the place, whether it was Rixford or some other station. Q. Did that end with this line of railroad running over to Buf- falo?— A. Yes. Q. Then you had to ship part of the way by pipe, did you ? — A. Yes. Q. And part of the way by rail? — A. Yes. Q. And the rest of the way on the Erie canal ? — A. Yes. Q. Was that a successful enterprise? — A- Oh, yes. Q. Well, could you ship your oil down there all the year round? — A. No. Q. What happened when the canal froze up? — A. Then we had to buy where we could here in the city. Q. Yes, you had to buy where you could? — A. Shipped some over the Pennsylvania road, too, I think. Q. Well, now about this time they commenced to build the Tide- water Company's line, did they not? — A. Yes. Q. And they got to Williamsport in 1879? — A. I don't remember the date ; somewhere about that time. Q. Did you have any interest in that enterprise? — A. I had some stock in it. Q. You took stock in it? — A. And then we agreed to take our oil from them when they brought it here to New York. Q. Now, then, do you know what refineries it was expected 532 would take the oil of this pipe? — A. S. Jenny & Son, Yennie & Burke, Bush & Denslow Company, Gregory, McGoy & King, and Wilson & Anderson. Q. Were those independent companies at that time? — A. Yes. LOMBABD. 259 Q. What became of those companies? — A. Gradually they made arrangements with the Standard. Q. At about what time did the Standard acquire those refineries ? — A. Before or soon after the Tidewater line was through. Q. Do you know whether they had made any agreement or ar- rangement by which they were to take the oil from this pipe? — A. It was so understood. I don't know whether there was any Q. Over the Tidewater Pipe Company's line. — A. They so under- stood it. "Whether there was any verbal or written agreement, I don't know. Q. And then the Standard acquired them? — A. Yes. Q. What was the next move made to provide refineries to take care of this oil that came from the Tidewater pipe? — A. They built 3 refinery below Philadelphia, at Chester, that the Tidewater was to run to, and one at Bayonne, New Jersey. Q. What are the names of those companies that built those refiner- ies to take this oil? — A. The Ocean Oil Company, the Chester Oil Company, and Lombard, Ayres & Company, it was before Q. And Lombard- Ayres. Why were these refineries built that you have just mentioned? — A. To receive the oil from the Tidewater Pipe Company. 533 Q. That is, the oil that you expected these other refineries to take when you were building the line ? — A. Yes. Q. Well, now, you have been interested in that pipe line, have you not, ever since its construction ? You are interested in it now ? — A. I am interested in the Oil Company now. Q. Yes. Well, the Oil Company now owns the Pipe Company, doesn't it?— A. Yes. Q. Was there any time that you were unable to get your oil by rail, and you had to buy oil in New York City ? — A. Yes. Q. When was that?— A. That was in 1878. Q. When you talked about the " squeeze " in the cars? — A. Yes. Q. Was that the time? — A. Yes, and before that, when the Erie railroad passed into the hands of Fiske and Gould. For a time we were compelled to buy a great deal of oil from them. Q. From whom? — A. From Harley, a man whom they put in charge there; Henry Harley. Q. You say you at one time had some tank cars of your own ? — A. We did. Q. What became of those cars ?— A. We sold those to J. A. Bost- wick & Company. Q. Who was J. A. Bostwick ? — A. He was a large oil dealer here in New York. Q. Was he connected with the Standard ?— A. Not at that time ; I think he was afterwards. Q. How long before he became connected with the Standard ? — A. r couldn't tell you exactly ; a few years only. Q. You sold your cars to him ?— A. Yes sir. 534 Q. Well, wasnt he at that time a director in the Standard Oil Company?— A. I think not. 260 LOMBABD. Q. What did you sell your cars for? — A. Well, we were afraid about freights, because the South Improvensent Company wasn't very long past, and then we were short «f money, and then Mr. Bostwick gave us a very good contract to run our refinery for a year. Q. Had you made any effort to get the railroads to haul these cars for you? — A. Oh', they were hauling them, but we were afraid of freights. It was the New York Central Eailway only. Q. Afraid of what? — A. Afraid that the freights would be ad- vanced on us, on account of our experience with the South Improve- ment Company. Q. How could that make any difference, whether they advanced the freight on you or whether they advanced it to somebody else who hauled your oil? — A. Because we had a definite arrangement with Mr. Bostwick of J. A. Bostwick & Co. for a year to run our re- finery on a margin, so that our profits were sure. Q. Yes, but that only lasted a year. — A. We took chances after that. Q. What did you do after that? How did you get your oil? — ^A. We bought some of it, as I say, from Harley, of the Erie road, and shipped the remainder over the Pennsylvania road. Q. Had you disposed of these cars before the Pipe Line was com- pleted? — A. Oh, yes, in 1873 we disposed of those; the other forty were another lot of cars, the forty cars that I spoke of 535 some time ago. Q. What about those forty cars? — A. Those forty cars we sold finally to the Tidewater Pipe Company. Q. When were those built? — A. Those were built in 1878, I sup- pose ; I dont remember exactly if that was the time. Q. Were those steel cars? — A. No, they were wooden cars, with iron tanks on them. Q. With iron tanks. The cars you sold to Bostwick were wooden cars ? — A. No, those were wooden cars, with iron tanks, I think, too. Q. Did you laiow John H. Cuthbert? — A. I did when he was living. Q. When did you become acquainted with him ? — A. When he be- came a director in the Tidewater Oil Company. Q. He was the gentleman who represented the Standard interests there?— A. Yes. Q. Did you know him before that? — A. No. Q. Did you know who he was? — A. No, I dont think I had ever met him before that. Cross-examination by Mr. Eosenthal: Q. How old a man are you, Mr. Lombard? — A. Sixty-five. Q. You never have been in any other business, I suppose, except the oil business ? — A. Yes, some other. I was in the oil business all the time, but I had some other Q. You have been in the oil business since some time in the six- ties?— A. 1866. LOMBARD. 261 536 Q. Are j^ou actively engaged in business now? — A. Yes. Q. In Avhat business ? — A. Oil business still. Q. Connected with what company? — A. The Tidewater Oil Com- pany. Q. In what capacit}'? — A. Director. Q. All of these conversations that you have told us of, that you had with Mr. Scott and Mr. Cassatt, and these other gentlemen — Mr. Rutter — occurred about thirty years ago, did they not? — A. Nearly, yes. Q. What?— A. Yes, nearly. Q. You dont pretend at this length of time to have any exact recol- lection of the conversations, I suppose, do you ? — A. I have read my evidence given twenty-eight years ago and refreshed my memory in that way. Q. Aside from having read j^our testimony given twenty-eight years ago, had you any recollection of it? — A. Part of it. Q. What? — A. Part of the conversation, a few salient points. Q. Had you any exact recollection of those points ? — A. Some few things, but not the whole of the conversations, of course. Q. In the main, it was rather hazy, wasnt it, until you read your testimony before the Hepburn Commission, in 1879? — A. Rather what? Q. Rather hazy ? — A. Yes, it was. Mr. MoEEisoN. It wasnt before the Hepburn. Q. You testified before the Hepburn Committee, in 18T9, didnt you ? — A. I think this testimony which I refreshed my memory 537 with was a case of the Commonwealth of Pennsylvania against the Pennsylvania Railroad. Q. Yes, but you did testify before the Hepburn committee in 1879?— A. I did. Q. And your memory was probably better then concerning the events that transpired in the preceding years than it is now? — A. Certainly. Q. You were a member of the firm of Lombard, Ayres & Co. in 1877 and 1878 ?— A. It was Lombard & Ayres then. Q. Lombard & Ayres ? — A. Lombard & Ayres. Q. Was that a corporation? — A. No. Lombard, Ayres & Com- pany was formed afterwards. Q. Well, you were a member of that firm during those two years?— A. I was. Q. I dont suppose that firm ever got any rebate on shipments of its oil over any of the railroads, did it ? — A. Yes. Q. It did? When? — A. Over the Pennsylvania Railroad. You will find it in that other testimony. Q. Well, but I am trying to find it now in your mind.— A. All I remember is what was in that testimony. That is all I remember about that. Q. Well, having read that testimony, you have a very distinct recol- lection now? — A. Yes. 262 LOMBARD. Q. Of Lombard & Ayres having received a rebate? — A. I do. Q. From the Pennsylvania Eailroad ? — A. From the Pennsylvania Railroad. 538 Q. Extending over some considerable length of time? — ^A. I think not very long, about a year. Q. About one year? — A. I think so. Q. Well, the payment of rebates during those early days was quite a common thing, wasn't it ? — A. Quite common. Q. And it was not limited to the oil business, was it? — A. I sup- pose not ; I don't know. I don't speak from knowledge. Q. Don't you know that rebates were quite generally paid on the shipment of grain and flour in the West? — A. I know by common report. Q. That was common report, in those days? — A. Yes, that was common report. Q. The fact about the matter is that the shipment of freight dur- ing those early days was largely a matter of private contract be- tween the shipper and the railroad company, was it not? — A. Very possibly. Q. What?— A. Very probably. Q. Well, isn't that the fact, Mr. Lombard? — A. I think so. I haven't the experience, so I can't say except from hearsay. Q. In those days there were no laws prohibiting a railroad com- pany giving a rebate? — A. No. Q. To your knowledge? — A. No. Q. And every shipper tried to ship at the very lowest rate that it was possible for him to receive, did he not ? — A. Yes. Q. And freight rates were sold about as merchandise was 539 sold in those days, isn't that so? — A. I can only speak about the oil business. Q. Well, that was true generally in the oil business ? — A. Yes. Q. Now, you spoke of a war directed against the Empire Com- pany? — A. Yes. Q. The Empire Company was a private corporation that con- trolled the shipment of all oil over the Pennsylvania Railroad Sys- tem, was it not ? — A. So I understood. Q. The Pennsylvania Eailroad turned that over to the Empire Company to conduct as the Empire Company saw fit to conduct it? — A. Yes sir. Q. Now, do you remember that, after a while, the Empire Com- j)any, in addition to giving its attention to freight matters, began to build refineries? — A. I think they took an interest in one refinery; T know of no other. Q. Well, isn't it a fact that they had an interest in quite a number of refineiies ? — A. Not that I know of ; I only know of one. Q. And wasn't it because of the fact that the Empire Company which had theretofore been limited to the carriage of freight, got into the refining business, that the refiners started the war on the LOMBAED. 263 Empire Company? — A. I am not in the secrets of the refiners who started that, so I don't know. 540 Q. And what it was that ultimately led up to the sale by the Empire and its Company to the Standard Oil Company you don't know either ? — A. I don't know. Q. You have no personal knowledge of that sale, at all, have you ?— A. Except as Mr. Cassatt told me. Q. Except as Mr. Cassatt told you, yes. Now don't you know that — well, you know that the Empire Company had a great many tank cars, do you not? — A. Yes sir. Q. Do you know to whom they sold those tank cars I — A. I under- stood the Standard Oil Company. Q. Isn't it a fact that they sold their cars to the Pennsylvania Kail- road Company ? — A. I don't so understand it. Q. You don't know, as a matter of fact, do you? — A. Not if that is a fact, I don't know it. Q. Well, do you know anything about the fact? — A. I understood from Mr. Cassatt they were sold to the Standard Oil Company. Q. And what was it Mr. Cassatt said about that? — A. He said the Standard Oil Company had bought out the Empire line. Q. Had bought out the Empire line, and you inferred from that that they had bought everything that the Empire had theretofore had? — A. Certainly. Q. Now, if the Government in this case in its bill had made the averment that the Empire Transportation Company sold those 541 cars to the Peimsylvania Railroad Company, would you be in- clined still to adhere to your recollection of your conversation with Mr. Cassatt? — A. I should. Q. What? — A. I should; because I gave that testimony when everything was fresh in my mind. Mr. MoEEisoN. That is objected to. Q. Now, where were you in March, 1872 ?— A. 1872 ? Q. In the month of March, 1872 ?— A. That was the time of the Q. Where were you at that time? — A. New York; in New York probably. Q. Did you have anything to do with the South Improvement Company, as a company? — A. Opposing it, yes. Q. You were not a stockholder?— A. No; I was opposing it. Q. You were not a stockholder? — A. No. Q. You were not an officer of the Company ? — A. No. Q. Was the plan of that company submitted to you ?— A. No. Q. They speak of a South Improvement Company contract ; what do you understand that to be ?— A. A contract with the various rail- roads bringing oil to the seaboard. Q. To do what? — A. The contract with the various railroads bringing oil to the seaboard or elsewhere, I think everywhere. Q. Did you ever see the contract, Mr. Lombard?— A. I think I have seen a copy of it. Q. Where:' — A. I don't remember. 264 LOMBAKD. Q. When? — A. I don't remember. 542 Q. How many years ago? — A. Oh, probably twenty-five. Q. You don't pretend now, I suppose, to be familiar with the provisions of that contract? — A. I do not. Q. Who showed it to you ? — A. That I couldn't tell you. Q. How did you know it was a South Improvement Company contract? — A. It purported to be a copy. Q. That is the only way you loiow it ? — A. I think I saw it at the very time of the contest about it. There was a large meeting of the producers held here in Xew York at the Fifth Avenue Hotel, and I think they had a copy of the South Improvement Company. Q. They had what somebody said was a copy of that contract? — A. I take it so. Q. Is that right?— A. I take it so. Q. And that was way back in 1872?— A. That was in 1872. Q. Xow, have you anj^ personal knowledge as to who the stock- holders of the South Improvement Company were? — A. No. Q. You don't know a thing about it, do you ? — A. Only by common report at that time and since. Q. Well, you answered Mv. Morrison that Mr. John D. Rockefeller was a stockholder of that Company. You, as a matter of fact, don't know that, do you ? — A. I know it about as well as I know anything. Q. What? — A. I know it about as well as I know anything. Q. Well now, isn't it true that you only knew it as a matter 543 of common repute at that time? — A. Common repute at that time of the South Impiovement Company Q. Yes sir. — A. And since. Q. But, in the last analysis, all you know about it is, what you know as a matter of common repute, isn't that so? — A. I didn't see Mr. Rockefeller sign it. Q. No, no, answer my question, please. Mr. Kellogg. He is answering it. Q. Do you know anything about it except as a matter of common repute? — A. No. Q. Well, that answers it. Now, you testified before the Hepburn Committee that you hadn't any personal knowledge that the Standard Oil Company ever received a rebate, I think, did you not? — A. I don't know whether I did or not. Q. What is the fact about that? Have you any personal knowl- edge that it ever received a rebate, or is that also a matter of common repute? — A. What is the date of that testimony? Q. 1879, Mr. Lombard. Wasn't that also a matter of common repute? — A. No, I have seen the pool contract that they were to receive a rebate. Q. What ? — A. I have seen the pool arrangement. Q. You have seen what? — A. I have seen the pool arrange- ment, among the railroads, by which they were to receive a 544 rebate. Q. When was that? — A. It must have been previous to ' se\'enty — previous to my testimony in Philadelphia. LOMBARD. 265 Q. Previous to 1879 ?— A. About 1879, I suppose. Q. Where was it you saw that pooling arrangement? — A. I dont know ; I must have known about it when" I testified in this suit. Q. You dont know when it was? — A. No, I dont know when it was, because I say that they did receive rebates then. Q. Didnt you testify in 1879, that the only way that you knew that the Standard Oil Company received rebates, was as a matter of infer- ence based upon the ])rice at which they bought and the price at which they sold ? — A. Possibly I did ; I dont remember. Q. "Well, did you? — A. I dont remember. Q. If you did, you then stated the fact, I suppose?— A. If I what? I beg j'our pardon. Q. If you did so testify, that was the fact?— A. That was the fact if I testified to it then, yes sir. Q. Now, isnt it a fact that that is the only way you know anything about this subject matter of rebates? — A. No, I think not. I think I had positive Imowledge of it -when I testified in that suit of the Com- monwealth of Pennsylvania. Q. You had difficulty, you say, in getting cars that you required from time to time to ship your oil? — A. A great deal of diffi- culty. 54.5 Q. That was a difficulty you had with the railroad com- panies? — A. The Pennsylvania road. Q. Do you Icnow whether other shijDpers had the same difficulty? — ■ A. Well, by common report I do. Q. What? — A. By common report I do. Q. Didnt Mr. Scott tell you that they only had eleven hundred cars with which to ship oil ? — A. I think he did. Q. And that it was impossible, because of that, to at all times fur- nish all shippers all the cars that they required ? — A. I think he said so, yes. Q. And didnt Mr., Cassatt also tell you, in one of those conversa- tions, that you were getting as low a rate as the Standard Oil Com- pany or any other shipper? — A. I think he did, so long as our con- tract with the Empire line lasted, not afterwards. He told us frankly afterwards that we couldnt get them. Q. Well, I think that is all. I may recall you on that one question, Mr. Lombard. Re-direct examination by Mr. Moeeison : Q. Mr. Lombard, you spoke about this contract with the Empire Transportation Company, and said something about a rebate under that contract. Just explain now what there was about that, how you figured out that there was anj' rebate p-did under that contract. — A. They gave, as I understand it, all shippers over that road 646 a rebate of ten per cent, which we got with others. Q. And you had a contract that you were, during that time, to get as low a rate as anybody? — A. Yes. Q. And there was a ten per cent rebate, if you call it that, allowed to every shipper, was there not? — A. Every shipper over the road. 266 LOMBAKD. Q. And you simply got the benefit of that allowance? — A. That is it. Q. Now, when did you cease to get that, even? — A. AVhen the con- tract with the Empire line expired. Q. And that was in May 1878, wasnt it ? — A. As I remember it. Q. And this period when you got the same rates as other people got, extended only from December 1877 until May 1878; is that right? — A. I think that is right. The dates I am a little mixed on. Q. Well, you testified on that, did you not, in the Pennsylvania case? — A. I believe so, and that is when my memory was fresh. Q. Now, did you ever get a rebate on anybody else's oil? — A. No. Q. Do you know whether the Standard did? — A. I know by com- mon repute. Q. Well, did you see any of those contracts that were made back there with the Pennsylvania Railroad? — A. I have seen them. 547 Q. Well, did they provide for the Standard's getting a rebate or draw -back on the oil shipped by other people? Mr. MiLBUEN. Just go back before that, and allow me to finish what I was going to say before you take the answer down. I object to that testimony, as those contracts cannot be proved in that way. Mr. Morrison. Will you produce those contracts ? Mr. MiLBURN. You might as well ask me to produce the original Koran. How have I got them ? Mr. Morrison. They were signed by the Standard Oil Company, and if you produce them that is all right. Mr. MiLBURN. Why, you gentlemen are asserting they are, that is all. Mr. Kellogg. You admit they were signed by the Standard Oil Company. Mr. MiLBUEN. I ha vent been asked to produce any contracts that I ha vent got here. Mr. Kellogg. I show you the request. Mr. Morrison. You were asked to produce all those contracts, and you have admitted the execution of those contracts in your answer. Mr. MiLBUEN. Well, then, that certainly would settle that 648 point. But I am objecting to your proving the contents of contracts bj' Mr. Lombard saying that he had seen a contract at some time, and what was in it. Now, that is my objection. The last question was read. A. You can call it a draw-back or a commission. Q. Well, you sa_v, then, that they did get either a draw-back or a commission ? — A. ^'es sir. Q. You knew about the pool contracts of 1877 and 1878, did you not? — A. I think mainly by inference. Q. How was that? — A. I think I knew those contracts mainly by inference; I was sure of the position, but only by inference, until I saw Q. Do you remember whether you ever saw the t;ontract here marked Exhibit 8, which is a letter from Daniel O'Day to A. J. Cas- satt, and A. J. Cassatt's reply thereto? — A. Never until to-day. HAMPTON. 267 Q. Well, then, you dont need to look at it if you are sure of that ? Mr. MiLBTJEN. What did he say ? Mr. KosENTHAL. Never until to-day. Q. You were asked about your testimony in the case of the Com- monwealth of Pennsylvania against the Uhited Pipe Lines and the Pennsylvania Railroad Company and others. Do you know whether that case was ever brought to a final hearing or not? — A. I do not. Q. Do you know how it was settled ? — A. I do not. 549 Q. Do you know whether there was any contract entered into by the Standard Oil Company and the National Transit Company and the railroad company and other parties interested in that law suit ? — A. In that case ? Q. Yes. — ^A. I do not. Q. I mean a contract of settlement. — A. I do not. Q. Did you know that Rockefeller and Flagler and some of the others were indicted in reference to the taking of these rebates, in the Pennsylvania courts ? — A. I do not. Q. Did you ever hear about that ? — A. If I have heard about it, I have forgotten it. Re-cross examination by Mr. Rosenthal : Q. I wanted to ask you why it was you sold your cars to J. A. Bostwick and Company in 1873. — A. I beg your pardon ? Q. Why was it that you sold your cars to J. A. Bostwick and Com- pany in 1873 ? — A. For three reasons. One was that we were a little frightened by the South Improvement Company the year previous, for fear we could not get good rates; another was we wanted the money; and another was that Bostwick and Company made a very good contract with us for running our refinery for a year or more. Q. Well, the principal one was that you wanted the money, I guess, wasnt it, because that seems to be the only one that you stated in 1879, Mr. Lombard? — A. I think that had largely to do with it. 550 Q. Yes, that was probably the chief reason why you sold those cars? — A. Very probably, and then it was a very good contract he gave us for running the refinery. That meant money. Mr. Lewis. I want to ask both sides if, after Mr. Lombard signs his testimony, he can be excused, as he wants to go away. Mr. MoERisoN. We have no objections. Mr. Rosenthal. Oh, certainly. (Signed) Josiah Lombakd. 551 Wade Hampton, called as a witness by the Petitioner, being duly sworn, testified as follows: Direct-examination by Mr. Kellogg: Q. What position do you occupy with the Standard Oil Com- pany?— A. General Auditor of the Standard Oil Company of New Jersey. 268 HAMPTON. Q. Auditor? — A. General Auditor, yes sir. Q. How long have you been? — A. I think it is about seven years, I dont know exactly. Q. Of the Standard Oil Company of New Jersey ? — A. And several other corporations. Q. What other corporations are you auditor of ? — A. The Standard Oil Company of New York, the Standard Oil Company of Kentucky, the Standard Oil Company of Indiana, the Standard Oil Company of Ohio, The Standard Oil Company of California, Atlantic Refining Company, Solar Refining Company, Continental Oil Company, Colonial Oil Company, West India Oil Company, the Galena-Signal Oil Company, Interstate Cooperage Companj^ Q. Is that all? — A. That is all I can thinlc of; I guess that is all. Q. Previous to your employment by these companies, what position did you occupy with the Standard Oil organization ? — A. I have held many different positions since I have been with them. 552 Q. When did you commence your service? — A. As an em- ploye of the Standard Oil Company? Q. Yes. — A. I cant remember exactly. Q. Do you remember the Trustees of the Standard Oil Trust? — A. I cant remember who they were, no. Q. I say do you remember the days or the time when the Trustees were in control? — A. Well, only from what I have heard here in court. Q. Were you in the employ of the organization at that time, or any of these companies ? — A. Yes sir. Q. In what capacity? — A. I was an accountant part of the time. Q. In the New York office? — A. I had charge of the auditing of accounts part of the time. Q. In the New York office ? — A. Part of the time. Q. At 26 Broadway?— A. Yes sir. Q. About what time did you commence the employment ? — A. 1895, I think it was. Q. Is that the first employment in the office at 26 Broadway? — A. Yes. Q. That was during the time of the Liquidating Trustees, wasnt it? — A. I suppose it was, yes. Q. Were you auditor? — A. I was in charge of the auditing. Q. What? — A. I was doing the auditing. Q. That is, you were the auditor for the Trustees? — -A. No, I was employed by various corporations ; not directly by the Trustees, 553 with the exception of a quarterly audit of the stock register. Q. How is that? — A. Except I made a quarterly audit of the stock register for the Trustees. Q. You made a quarterly audit of the stock register for the Trus- tees? — A. I reported to Mr. Flagler. Q. Now, the Trustees kept a register of all stock, did they? — A. Yes sir. Well, they did not, but the trnsfer agent did. HAMPION. 269 Q. The transfer agent did. Who was the transfer agent ? — A. Mr. John Bensinger. Q. Where was his office I — A. In 26 Broadway. Q. He was the transfer agent for the Trustees in Liquidation of the Standard Oil Trust ? — A. He was the transfer agent of the stock, yes sir. Q. And you, from 1895 down to the close of that Trust, audited that stock transfer four times a year?— A. Yes sir. Q. Now, then, when you ceased to be the auditor in charge for the trustees of the Liquidating Trust, you became the auditor of the Standard Oil of New Jersey ? — A. I was appointed by the board of Directors, yes. Q. At the time of the re-organization? — A. I dont remember the date. Q. Well, it was iu 1899, wasnt it? — A. No, I think it was after that. Q. You think it was after 1899? — A. I think so; I dont remember the exact date. It was after that date. 554 Q,. Well, what did you do to audit the books of the stock transfer? — A. Simply the transfer register. Q. The transfer agent kept a register of all transfers? — A. Yes. Q. And a stock ledger, did he? — A. Yes. I had nothing to do with that. Q. You didnt audit that? — A. No sir. Q. You audited the transfer register? — A. Yes, that is all. Q. Tell me just what you did. — A. I simply saw that the certifi- cates cancelled were properly cancelled on the register, and the certi- ficates issued therefor were recorded on the register. And I totaled the amount of uncanceled certificates, which I reported to the secretary. Q. To see if all certificates issued by the Trustees which had been returned and cancelled were properly accounted for? — A. The cer- tificates that were surrendered by the certificate holders. Q. Yes sir. And when those certificates were surrendered, this transfer agent issued assignments made by the Trustees in Liquida- tion, didnt he? — A. He issued, I believe, like certificates for those that were canceled. Q. He issued no new certificates after 1892, did he? — A. I dont know anything about the 1892 period. Q. You dont know anything about it? — A. No. Q. Well, after 1895 there were no new trust certificates issued, were there? — A. I dont think there were. 555 Q. What?— A. I dont recall that there were. Q. As the trust certificates were returned, the Trustees in Liquidation issued assignments, did they not, in all the corpora- tions? — A. The certificates read, I believe, assignment of legal title. Q. Now, it was your duty to go over the certificate book and the stock register? — A. Simply saw that the certificates were cancelled 270 HAMPTON. and properly recorded on the register and the new ones issued in ex- change therefor were recorded on the register. Q. That is, you mean the new assignments? — A. Yes sir. Q. And the register showed just what certificates were returned, whom they were returned by, and what assignments of certificates were issued in the place thereof, didnt it ? — A. I suppose it did. Q. Well, what became of those books? — A. I dont know, sir; I havent seen them for years. Q. You havent seen them for years ? — A. No sir. Q. Well, you audited them up to the time they were turned in and cancelled, didnt you? — A. Yes. Q. And practically all the outstanding certificates issued by the Trustees were turned in and cancelled? — A. I think so. Q. Well, now, was Mr. Bensinger the transfer agent that kept the transfer books up to the time the Standard Oil Company of New Jer- sey received that stock? — A. Yes, sir, I think he was. 556 Q. You have never seen those books since? — A. I dont re- call that I have, no sir. Q. Are they in your office ? — A. No sir. Q. Have you searched for them ? — A. They have never been in my possession. Q. Have you searched for them ? — A. I have not. Q. You have made no search ? — A. I have made no search. Q. Did you take a statement quarterly showing the condition of the transfer books? — A. Take a statement, no sir; simply a report that I found remaining uncancelled a total of so many shares. Q. Where are those reports ? — A. I have kept no copies. Q. To whom did you send them ? — A. To H. M. Flagler, secretary. Q. You never kept a copy ? — A. No sir, I have no copy. Q. Do the books in your office show the result of your audit? — ^A. No sir. Q. Those audits were made and given to H. M. Flagler? — A. Yes sir. Q. So that if this transfer book and register kept by Mr. Bensinger could be found, it would show exactly the condition of the outstand- ing stock certificates at any date, would it not ? I mean the outstand- ing trustee certificate. — A. The register would give the dates of the cancellations and the dates of the issue of new stock therefor, in all cases. Mr. MiLBUEN. New certificates, you mean ? Witness. New certificates. 557 Q. And the parties who surrendered the certificates, their names would also appear? — A. If it stood in their name, yes. Q. Yes, if it stood in their name. — A. Yes. Q. And to whom the assignments were issued, that would ap- pear ? — A. To whomever it was issued is recorded on there. Q. Now, did your report show that? — A. No sir. Q. Did not; just these stock books? — A. That is all. HAMPTON. 271 Q. You have never seen these stock books since? — A. No sir, I cant recall when I saw them. It is years ago. Q. Well, it cant be very many years ago. — A. Well, it must be seven years ago, at least. Q. Have you audited the stock transfer books of the Standard Oil Company of New Jersey since? — A. Yes sir. Q. All the stock transfer books of the Standard Oil Company of New Jersey are there, arent they? — A. I dont know whether they are all there or not. The ones that I have been auditing have been there. Q. They have not destroyed any of those, have they? — A. I dont know that they have destroyed any. Mr. JMiLBTjEN. Now, Mr. Kellogg, that is not proper. Q. They have not lost any, have they ? — A. I dont know of any. Mr. MiLBUEN. They have not lost them, either. Mr. Kellogg. Produce them, then. Mr. MiLBUEK. Now, that is not proper. You know just how you can get them if you want them. 558 Mr. Kellogg. How? Mr. MiLBUEN. Well, you dont need me to tell you. Mr. Kellogg. Dont I? Mr. MiLBURN. No. If you want those books, you know how to get them, if they are in existence, and I know nothing to the contrary. Mr. Kellogg. You dont know whether they are in existence or not ? Mr. MiLBUEN. I know nothing to the contrary, I dont know where they are. Mr. Kellogg. Well, if you will tell me how to get them I would like to get them. I asked you to produce them. Mr. MiLBTJEN. I dont think you need my advice how to get them. Mr. Kellogg. Well, I now ask the defendants to produce Mr. MiLBCRX. What defendants? Mr. Kellogg. The defendants represented by Mr. J. G. Milburn. Mr. MiLBTjEN. I havent got the books. Mr. Kellogg. To produce the certificate-book, the stock register, the stock ledger showing the amount of trustees certificates outstand- ing at the time of the commencement of the liquidation of the Stand- ard Oil Trust in March, 1892, and the process of such liquidation down to the close thereof in 1899. (No response.) 559 Mr. Ej;llogg. I asked the Standard Oil Company of New Jersey to produce them. Are they in their possession, Mr. Milburn ? Mr. MiLBUEX. I have inquired of the officers of the Standard Oil Company of New Jersey, and, as near as I can find out, these books were never in their possession, books that that company never had anything to do with, not their books. If they had them they would have been produced, as we did produce whatever we found in our office. 272 HAMPTON. Q. Well, yoii liavent got the books, Mr. Hampton? — A. No sir, I have not. Mr. MiLBURN. Mr. Hampton is one of the gentlemen I inquired of at once. You subpcsnaed him. You see what answer 1 got from him. I shall not stop making inquiries. If I find them you shall have the books. I have no objection wliate\'er to anything appearing that is in those books. You have argued what is in them with great perspicuity (that is a good word) and power. Mr. Kellogg. That will do. Q. You commenced as auditor of the Liquidating Trustees, then, about 1895 ?— A. Yes sir, early part of 1895. Q. Prior to that time were you in the employ of any of the Stand- ard Oil companies or of that organization? — A. Prior to that time I was employed by Mr. Bushnell. Q. Mr. Bushnell? — A. John Bushnell, controller, doing auditing work for him. Q. Controller of what company? — A. Several companies; 560 I cant remember all of them now. Q. The pipe line companies ? — A. Some pipe line companies. Q. Mr. Bushnell was the controller for many years of the pipe line companies, wasnt he? — A. He was the controller of a number of corporations, pipe line and producing companies. Q. Was he the controller of the National Transit Company? — A. Yes sir, I think he was. Q. For how many years? — A. I dont remember; a good many years. Q. Well, he was controller up to a month or two ago, wasnt he? — A. I think he was controller up to the 1st of July. Q. The first of July of this year ? — A. I think so. Q. Wliere is he? — A. I dont know, sir. Q. Did he resign then ? — A I think he did. Yes sir, he resigned ; I know he did. Q. Who is the present controller? — A. Mr. George Chesebrough. Q. ~V\1iat book did you audit during the period of the Liquidating Trustees? — A. I had audited by my representative the books of a number of corporations. I cant remember the names of them at this time. Q. Well, you audited, did you not, those corporations in which the Trustees had stock ? — A. A great many of them, no. Q. A good many of them you did ? — A. Some of them I did. Q. Now, during that period from 1895 down to the time 561 you became auditor of the Standard Oil Company of New Jersey, did you audit the accounts of the Anglo-American Company, Limited? — A. I had them audited, yes. Q. I mean either did it yourself or some of your assistants.— A. Yes. Q. Did you audit the Atlantic Refining Company? — A. ^'es sir. Q. Buckeye Pipe Line Company? — A. No sir. HAMPTON. ■ 273 Q. The Eureka Pipe Line Company? — A. No sir. Q. The Forest Oil Company? — A. No sir. Q. The Indiana Pipe Line Company? — A. No sir. Q. The National Transit Company?— A. The general office ac- count, yes sir. Q. Yes, the general office account. The New York Transit Com- pany? — A. Yes sir. Q. The Northern Pipe Line Company? — A. Yes sir. Q. The North ^Yestern Ohio Natural Gas Company ? — A. No sir. Q. The Ohio Oil Company?— A. No sir. Q,. The Solar Refining Company? — A. Yes sir. Q. The Standard Oil Company of Indiana ?— -A. Yes sir. Q. The Standard Oil Company of Kentucky ? — A. Yes sir. Q. Of New Jersey? — A. Yes sir. Q. Of New York?— A. Yes sir. Q. Of Ohio?— A. Yes sir. Q. The Union Tank Line Company? — A. Yes sir. 562 Q. Did you audit any of the pipe line companies except the National Transit and the New York Transit? — A. You have named the ones there. Mr. MiLBUBN. That is all you named. Q. Now, those were companies that you audited, the stock of which, or at least a part of it, was during that time held by the Trustees of the Standard Oil Trust? — A. I dont know that; I never had Q. You audited the books of the transfer agent, didnt you? — A. No sir, not of the auxiliary companies. Q. I mean you audited the books of the transfer agent of the Trustees?— A. Yes. Q. "\ATiat? — A. Yes, the stock register. I dont know what those certificates represented. Q. You dont know what certificates they represented ? — A. No sir, I dont know what they represented. Q. And you did not audit the transfer books of these companies ? — A. Of the subsidary companies ? Q. Yes. — A. No sir, never. Q. You didnt look to see what stock they had outstanding ?— A. I never examined them. Q. But you audited their general business?— A. That is all. Q. The accounts of the company.— A. Just simply as to their in- tegrity and correctness. Q. bid they make reports during that time to your office?— A. No sir. 663 Q. No reports whatsoever?— A. No sir. Q. You sent your employes to their offices?— A. Yes sir. Q. Wherever they were. Audit their accounts, and see if they were correct?— A. That is all. 325r.5— 08 18 274 HAMPTON. Q. Did you keep any memorandum of the business in your office? — A. Simply a memorandum stating that they have been audited up to a certain date. Q. After the organization of the Standard Oil Company of New Jersey, you continued to audit the accounts of the companies con- trolled by that company, in the same manner, did you ? — A. The aud- iting is done in the same way, yes, naturally. Q. There is no change in your office particularly? — A. Yes, there are some changes. Q. I mean no change in the manner of doing business. — A. There were quite a number of changes. As general auditor I would issue letters for the auditor personally, instead of having them go from some officer of the company as formerly. Q. Yes, biit what I mean, you audited A. The general work was the same. Q. Was the same? — A. Naturally. Q. Did you know about the transfer of these stocks to the Stand- ard Oil Company of New Jersey? — A. I did not. Q. You audited the books of the Standard Oil Company of New Jersey, didnt you? — A. That was after the transfer was made; I knew nothing about it. 564 Q. After the transfer was made? — A. After the transfer was made. Q. You knew about when they acquired these stocks, didnt you ? — A. About the date. Q. And that was during 1899, wasnt it? — A. I think it was. Q. And you audited the accounts showing the property account of the Standard Oil Company of New Jersey? — A. I did not, per- sonally. Q. You did not?— A. No. Q. Well, you had somebody do it? — A. Yes. Q. I mean somebody under your direction. — A. No report was made about their holding Mr. MiLBUEN. Speak up. Q. What? — A. I say no report was made to me by my auditor what their holdings were, what their property was, their assets or liabilities or profits. Q. They were audited by your assistant? — A. Examined, yes sir. Q. Did you ever do it personally ? — A. No sir. Q. Mr. Hampton, I show you Petitioner's Exhibit 1, being a list of corporations furnished by the defendant Standard Oil Company of New Jersey in which it owns stock. Mr. Kellogg. By the way, Mr. Milburn, have you got that list of the total capitalization of each one of the companies yet ? Mr. MiLBUEN. You must have it. I will get that. List 56.5 of capitalization of companies? Mr. Kellogg. Yes, that is all. Mr. Milburn. On Exhibit 1. HAMPTON. 275 Q. (Showing witness Petitioner's Exhibit 1.) Mr. Hampton, will you state if there is any company there the books of which are not audited by you or your auditors or imder your direction? — A. Yes, a number of them. A number of them. Q. Well, go over the list and read off those which j^our office does not audit. — A. The Advertiser Company, Atlantic Coast Lumber Corporation, Buckeye Pipe Line Company, The Carter Oil Com- pany, Chapman Iron, Coal & Coke Company, Crescent Pipe Line Company, Clarksburg Light & Heat Company, Empire Eefining Company, Limited, The Empreza Industrial de Petrolio, Eureka Pipe Line Co., The Forest Oil Company, Georgia Car & Manufac- turing Company, Hazelwood Oil Company, Hope Natural Gas Com- pany, I^awrence Natural Gas Company, Mahoning Gas Fuel Com- pany, Marion Oil Company. Mr. EosENTHAL. Do 3'ou audit the Indiana Pipe Line Company books ? Witness. Well, I think that I do the general books. I thought we did not, but I was going to correct that in the first list there. I think the Indiana we do. (Resuming answer.) Mountain State Gas Company. Meeker Foundry Company, Northwestern Ohio Nat- ural Gas Company, The Ohio Oil Company, People's Natural Gas Company, Pittsburgh Natural Gas Company; Richmond Chamber of Commerce stock, we dont audit that. 566 Q. No, I guess not. — A. Reserve Gas Company; The River Gas Company, Southern Pipe Line Company, South Penn Oil Company, Southwest Penna. Pipe Lines, Standard Oil Company of Nebraska, Taylorstown Natural Gas Company, United Oil Company, Waters-Pierce Oil Company. What is that question, Mr. Kellogg? the companies I audit at present? Q. No, pick out the companies you do not audit. — A. West Virginia Oil Company; that is all. Q. You audit the res£, do you, the rest of those companies? — A. Under my direction they are audited. Q. Or under your direction. Do you know who audits the books of these companies? — A. I do not, all of them. Q. Are they all audited by somebodj' in connection with the Standard Oil Company of New Jersey? — A. I dont know, Mr. Kel- logg, positively about those. Q. You dont know ? — A. I dont know positively. Q. Well, what do you know about it? — A. I dont know anything about their auditing of these other companies. Q. Dont know anything about the audit of these other companies at all? — A. I do not. Q. Well, do you know any reason why you audit part of the com- panies and do not the rest ? — A. I do not, unless it is a matter of con- venience, business convenience. 276 HAMPTON. Q. Well, how business convenience? I dont understand. Doesnt the Standard Oil Company of New Jersey wish to know the 5G7 condition or 3'our office wish to know the condition of the busi- ness of each one of these companies in which it holds stock? — A. They probably do. Q. Well, how do they get at it ?"~A. I dont know ; not through me. Q. Well, now, these companies that you do audit, just tell me what you do and what j^our assistants do, what books they examine and I'eport on. — A. They examine the cash, cash-books, verify the bank account, the cash balances; they examine the vouchers to see that they are properly approved and are correct; they check those- vouchers to the joui'nals and voucher-register, and the posting to the general ledger. They pro^e the footings in tjie legder, and they cheek those balances of the ledger to their last trial-balance; and of coTirse take an inventory of the stock, of what is on hand. Q. Of all property on hand? — A. No, the stocks and goods on hand. Q. Oh, they take an inventory; I didnt understand you. — A. In the personal account sales ledger they verify the outstanding ac- counts of the customers by letter, simply to verify as to the correct- ness and validity of the customer's account. That is, on the Avhole, the general way it is done. Q. They check up the balance-sheets, or trial-balance, rather, of the sub-companies? — A. Yes, and simply report that they have proved the trial-balance to be correct. Q. Novi', are those trial-balances of these companies sent to your office? — A. Very seldom. 568 Q. Are they sent anywhere, to 26 Broadway? — A. They may be. Q. Do you know whether the^- are or not ? — A. They may possibly to the controller. I dont know. Q. Do you check the books of the controller? — A. Have them checked, yes sir. Q. That is, they are audited under your supervision? — A. Yes sir. Q. Mr. Fay is now controller? — A. Assistant controller. Q. Assistant controller? — A. Yes sir, of certain companies. Q. What? — A. Of certain companies. Q. Well, of the Standard Oil Company of New Jersey? — A. Yes sir. Q. Are those trial-balances sent to this office? — A. Through me, no sir. Q. To his office? — A. I dont know, positively; I presume so. Q. You presume they are. The trial-balance of these companies which you take is taken off at least once a year, isnt it? — A. I think so. Q. And that shows all the property of the sub-companies? — A. I presume so, I cant state. Q. Will it so show it? — A. I dont know. HAMPTON. 277 Q. The trial-balance should show the exact condition of the com- pany, its assets and liabilities?— A. It ought to show what is on the books, yes sir. Q. And if it did not show that you would be pretty apt to find it out, wouldn't you? — A. I might not. 669 Q. Among these companies which you said you did not audit were the books of the Waters-Pierce Oil Company?— A. Yes sir. Q. Your office used to audit them prior to 1900 ? — A. Yes sir ; the general office. Q. What? — A. The general office accounts only. Q. Yes, the general office account of the Waters-Pierce Oil Com- pany was audited prior to 1900? — A. Yes sir. Q. Then they organized the new company. Did you audit those accounts after 1900, of the new company? — A. No sir, they are not under my direction. Q. Not under your direction ? — A. No sir. Q. You didnt send auditors to them? — A. I did, at their request, yes ; they employed some of my men. Q. That is, you sent auditors to audit their books ? — A. They asked me for the services of some men. They paid them while they were there. Q. They made their report to you, didnt they? — A. No sir, they did not. Q. You didnt see the report? — A. No sir. Q. Now, that was a company that the Standard Oil Company was very largely interested in, wasnt it ? — A. I dont know of my own per- sonal knowledge. Q. You dont know? — A. No sir. Q. Well, you audited the books of the Standard Oil Company of New Jersey, didnt you? — ^A. Yes sir. Q. Didnt you find an account showing the ownership of the Stand- ard Oil Company of New Jersey in the Waters-Pierce Com- 570 pany? — A. No sir; I didnt make the audit personally. Mr. MiLBUEN. Well, there is no question about that. Q. You didnt? — A. No sir. My auditor didnt report to me the names of the companies on the books. Q. You did send auditors to the Waters-Pierce Oil Company, at their request? — A. Yes sir. Q. And directed them to report A. To report to the officers in St. Louis, yes sir. Mr. MiLBTJEN. The offices of the Waters- Pierce ? Witness. The offices of the Waters-Pierce. Q. Did you write a letter to Mr. J. G. Gruet, the vice-president of the Waters-Pierce Oil Company, on February 8, 1901, about auditing the accounts of the Waters- Pierce Oil Company ? (Handing witness book.) — A. I probably did. I dont know whether that is a true copy or not. 278 HAMPTON. Mr. Mii^tiEN. You have no doubt that is correct? Witness. I think that is probably a correct copy. Mr. Kellogg. I will read the letter: " 26 Broadway, Eoom 800, Neio Yorh, February 8, 1901. Mr. J. T. Geuet, Vice President Waters-Pierce Oil Company, St. Louis, Mo. Dear Sir: Our Mr. Conrey will probably arrive at your office on Monday next, the 11th inst., to take up the audit of the books and accounts of your general office. For reasons which you 671 undoubtedly will appreciate it is best that Mr. Conrey be con- sidered an employe of your company during his examination. Therefore kindly enter his name on your pay-roll from the date of his arrival, at $191.67 per month. Also kindly pay what expenses he is under from the time he left New York. Yours truly, Wade Hampton." Q. Now, what are the reasons that he would undoubtedly appre- ciate why you sent this auditor there to be paid in that way ? — A. I cant recall, Mr. Kellogg, what they were, now. Q. You seem to be sure that he would undoubtedly appreciate those reasons. — A. Probably. Q. Was there any reason why the Standard Oil Company desired to cover up its ownership and control of the Waters-Pierce Oil Com- pany? — A. I dont know. They didnt explain it to me. Q. What ? — A. It was not explained to me that they had. Q. You had no such reason? — A. I cant recall why it was, Mr. Kellogg. Mr. MiLBTTRN. What page is that ? Mr. Kellogg. That is 1901, February 8. Q. It was a fact, wasnt it, that at that time the Standard denied owning or controlling the Waters-Pierce Oil Company? — A. Not that I knew of at that time. Q. Well, did you know of the stock of the Waters-Pierce being owned by the Standard at that time ? — A; I had no idea of the owner- ship. 572 Q. Well, why did you adopt a different mode of auditing the books of the Waters- Pierce Company than you did of au- diting the books of the old Waters- Pierce ? — A. The officers told me they would audit their own accounts. Q. What officers told you? — A. I cant recall who they were. I think one of the directors. Q. Of the Waters-Pierce? — A. Yes sir. Q. Who was it? — A. I dont remember who it was. Q. Mr. H. Clay Pierce? — A. I think not, but I cant remember who it was. HAMPTON. 279 Q. You have no recoUectioii of the reasons which you thought Mr. Gruet would undoubtedly appreciate? — A. I have not at this time; no recollection of what the reason was. Q. Well, on July 7, 1899, 1 find a letter here, " 26 Broadway, Room 800. New York, July 7, 1899. Mr. H. C. Pierce, President Waters- Pierce Oil Company, St. Louis, Missouri. Dear Sir : This letter will introduce to j'ou our Mr. John B. L. Hornberger, who visits St. Louis at my request for the purpose of auditing the books, accounts, etc., of your general office. I will in a short time send him one or two auditors to asist him in the worlt. Any favors extended to Mr. Horn- berger will be much appreciated." — A. That is 1899. Q. July 7, 1899. Mr. MiLBUEN. ^Aliose letter is that? Mr. IvELLOGG. Mr. Wade Hampton. Witness. I directed the auditing in 1899. 573 Q. The verj^ next year you sent a man, and the only material change in your instructions which the letter shows is that there were undoubted reasons whj' you wished it done in this way, and you directed them to pay the man. Mr. MiLBTJEN. Let me see that. You say one was in 1899 and the other in 1901 ? Mr. Kellogg. One was in 1899 and the other in 1901. Q. Each year thereafter you sent auditors to audit the books of the Waters, Pierce Oil Company, didnt you? — A. At their request, yes. They employed him. Q. Where is their request? Was it made in writing? — A. I cant recall whether it was or not. Q. You have no recollection as to whether the request was in writ- ing or not ? — A. I have not. Q. Did any of the officers of the Standard Oil Company of New Jersey make any request to you about this? — A. No sir, not that I can recall. Q. Wasnt there the same reason for auditing the books of the Waters-Pierce Company that there was for auditing the books of any other company in which the Standard owned a majority of the stock ? — A. I cant answer that. Q. You dont know ?— A. No, I cant answer it. Q. You audit no companies except those you are directed to ? Mr. MiLBUEN. Does it make any difference ? A. I audit the accounts of companies upon the request of 574 some of the officers or directors. I, of course, do not audit the accounts of any company that does not make a request.. Q. Well now, if you simply sent these men there for the convenience of the Waters-Pierce Oil Company, you j^ot no reports, you say, from them? — A. No sir. Q. Well then, why did you write to them after these men returned objecting to certain items? — A. I did not. Q. You did not?— A. Not that I recall, no sir. 280 HAMPTON. Q. Well, I wish to show you some letters ; a letter dated March 28, 1899.— A. That is 1899. Mr. MiLBTjEN. Oh, that is before. Q. All the objections you made, then, were prior to the new com- pany, were they ? — A. Yes sir, as far as I can remember. Q. You made no objection after that? — A. I have no reports. Q. No reports. Well, after these men finished the audit of the Waters-Pierce Company, what became of them? — A. They returned to my service. Q. Returned to your service? — A. Yes sir. Q. And each time you sent men out there who immediately returned to your service when they finished ? — A. I cant recall the exact time. Different times thej^ were sent there, at their request, yes sir. Q. And you say, Mr. Hampton, that you never heard any reason why you ceased to audit those accounts? — A. It was never explained to me, sir. Q. Do you laiow the Security Oil Company? — A. No sir. Q. Never heard of it? — A. Well, I have heard of it here 575 in the court-room. Q. That is all? — A. I dont recall that I ever l^eard of it before; it is "possible. Q. Have you ever heard of the Corsicana Eefining Company ? — A. Yes sir. Q. Corsicana, Texas? — A. Yes sir. Q. Have any of your auditors audited the accounts of that com- pany? — A. Never. Q. You never sent them a man to audit their accounts? — A. No sir. Q. Have you ever heard of the Manhattan Oil Company ? — A. Yes sir. Q. Have your auditors audited the accounts of that company ? — A. No sir ; I had nothing to do with it. Q. You have nothing to do with it? — A. No sir. Q. I asked you if any of your auditors have ever audited the ac- counts of that company ? — A. Not by my direction, if they did. Q. Well, do you know whether they have or not? — A. I dont. Q. Do you loiow whether anybody who is in your employ has been sent by you to audit the accounts? — A. No sir, no one has been sent by me, sir. Q. Well, has anj^ one from your office, during the last five or six years, temporarily left your employ and audited the accounts of the Manhattan ? — A. I cant say. Q. You dont know ? — A. I dont know. Q. Well, you remember the Waters-Pierce incident, dont you ? — A. Oh, yes, very well. Q. No such transaction took place with the Manhattan? — 576 A. No sir. Q. Did you know John H. Cuthbert? — A. I did. Q. What was his business ? — A. I think at the time of his death he was connected with the Tidewater Oil Company. HAMPTON. 281 Q. He was a director in the Tidewater, wasnt he, representing the Standard Oil Company ? — A. I really dont know his title. Q. Well, he was in the employ of some of the Standard companies, wasnt he? — ^A. At the time of liis death? Q. Yes sir. — A. No sir, not that I know of. Q. Was he an auditor ? — A. At the time of his death ? Q. Yes sir. — A. No sir. Q. Of one of the Standard companies ? — A. No sir, not that I know of. Q. Was he in the employ of the National Transit Company ? — A. At the same time he was with the Tidewater ? Q. Yes sir. — A. No sir. Q. Did he have an office at 26 Broadway ? — A. No sir. Q. Was he around 26 Broadway on his business? — A. No sir, not that I know of. Q. You didnt see him ? — A. I saw him ; I loiew him very well, and would see him socially. Q. You knew him very well ? — A. Oh, yes. Q. Do you say that he never, as far as you knew, worked for the Standard Oil Company, or any of its corporations? — A. I didnt say so, sir. 677 Q. Well, did he ?— A. He might have, yes. Q. Well, did he?— A. At the time of his death? Q. No, before his death. — A. Oh, years ago, yes sir. Q. Well, what years, do you remember? — A. I dont remember, Mr. Kellogg? Q. 1899? — A. I dont think he did. I dont remember, though. I dont think he did. Q. You dont think he did. — A. I cant remember the date. Q. You dont know about that ? — A. Some years ago. Q. What do you know of the Manhattan Oil Company? — A. Nothing. Q. Know nothing about it? — A. Only what I have heard here in the court-room. Q. Did you say you audited the accounts of the Union Tank Line Company? — A. I have them audited, yes sir. Q. Every year ? — A. I dont know how often ; currently. Q. Well, about once a year? — A. About once a year, probably. Q. Did you audit them since 1895 ? — A. Yes sir. Q. Do you audit the accounts of the Ohio Oil Company?— A. No sir. Q. Or of the Solar Eefining Company?— A. Yes sir. Q. The Solar Eefining Company?— A. The Solar Eefining Com- pany. Q. Now, about 1899 did the Solar Eefining Company buy the re- fineries of the Manhattan Oil Company ?— A. I dont know, sir. 578 Q. Well, their accounts will show, wont they?— A. The auditor made no report to me of what was on the books. 282 HAMPTON. Q. The balance-sheets will show, wont they? — A. I didnt see any balance-sheet. Q. You didnt see any balance-sheet? — A. No sir. Q. You never did ? — A. They dent come to me, no sir. Q. Now, Mr. Hampton, you said you believed you did audit the accounts of the Indiana Pipe Line Company ? — A. I think so, yes. Q. And the New York Transit Company? — A. Yes. Q. And the National Transit Company ? — A. Yes sir. Q. But none of the other pipe line companies? — A. I have given you the exceptions ; I cant recall them now. (The examination here adjourned until the morning of Wednes- day, September 25, 190T, at 10:30.) 579 Septemher '25, 1907. The hearing was resumed at 10 :30 A. M. Ware Hampton, recalled as a witness on behalf of Petitioner, testi- fied as follows: Direct-examination (resumed) by Mr. Kellogg: Q. Mr. Hampton, what departments of the Standard Oil Company of New Jersey do you audit or have audited under your direction ? — A. Why, I think all of them, Mr. Kellogg. Q. Well, their manufacturing departments? — A. Yes sir. Q. The books showing the operation of their manufacturing de- partment? — A. Yes sir. Q. Do you audit the books showing the income from their various stocks and securities? — A. Of the Standard Oil Company of New Jersey ? Q. Yes. — A. One of my men audits them, I presume; he does not report to me on them. Q. One of your men audits them? — A. Yes sir. Q. He does not report them, you say? — A. He does not make any report as to those figures. Q. You audit the comptroller's books? — A. Yes sir. Q. And the transfer books? — A. Yes sir. Q. Now, what other departments are there that you audit? — A. Of the Standard Oil Company of New Jersey? 580 Q. Yes. — A. I think that covers them: the comptroller's office and the manufacturing department, and the treasurer's. Q. And the treasurer's? — A. Yes sir. Q. The income and property accounts, what office are they kept in? — A. I presume in the comptroller's office. Q. You personally have not done any of this work? — A. No sir, except on the transfer stock register. Q. Transfer stock register? — A. Yes sir. Q. You do that? — A. Yes sir. Mr. KelijOgg. I dont think there is anything more I would like to ask Mr. Hampton at this time ; if I do I will recall him. FOLGEE. 283 Cross-examination by Mr. Milbuen: Q. I have just one question, ilr. Hampton, with reference to the stock register and certificate-book of the Liquidating Trustees: you said you had made no search in your office. Is that because you know they are not there?— A. Oh, in my office, they have never been in my office. Q. You know they are not in your office? — A. I know they are not in my office. Q. So a search would be A. Useless. 581 Mr. Kellogg. Mr. Milburn, I have a statement here which you have given me, showing the capitalization of the compa- nies named in Petitioner's Exhibit 1, except certain companies here which are marked as having no data, showing the capitalization of the following. Mr. MiLBUEN. Yes. Mr. Kellogg. May this be taken and stipulated to as the correct capitalization of each one of the companies shown on this list, with the exception of those which you state there is no data showing the capitalization ? Mr. MiLBTJEN. It may. Mr. Kellogg. AYill you please mark that as an exhibit. The same was marked Petitioner's Exhibit 31. Mr. Kellogg. I offer Petitioner's Exhibit 31 in evidence. Mr. Ee- porter, were there not one or two exhibits that were not offered in evidence yesterday? The Eepoetee. Petitioner's Exhibit 30 was not offered in evidence. Mr. Kellogg. I will offer Petitioner's Exhibit 30 in evidence. A copy of Manhattan Oil Company gas oil contract was marked Petitioner's Exhibit 32. Mr. Kellogg. At the time Mr. Benedict testified, he testified that there was a contract, as I recollect, between the Indianapolis Gas Company and the Manhattan Oil Company for a supply of oil for a certain length of time. He was asked to produce the contract. 582 He has produced a copy which counsel are willing may be treated the same as the original, which is Petitioner's Exhibit 32, and I offer it in evidence. It is consented by all counsel that the copy may be taken in lieu of the original. In the examination of Mr. Pratt, certain information was asked of him, which has been furnished in a statement marked Petitioner's Exhibit 33, which counsel consent may be taken as part of Mr. Pratt's testimony in explanation of certain items of his testimony. (The paper was so marked. Petitioner's Exhibit 33, and was offered in evidence.) FOLGEE. 583 Henry C. Folgee, called as a witness on behalf of Peti- tioner, being duly sworn, testified as follows: Direct-examination, by Mr. Kellogg: Q. Give us your full name and residence, Mr. Folger. — A. Henry C. Folger, Jr., 24 Brevort Place, Brooklyn, New York. 284 FOLGEE. Q. Are you in any way connected with the Standard Oil Company, or any of its sub-companies? — A. I am connected with the Standard Oil Company of New York. Q. How long have you been ? — A. 26 or 27 years, since 1879. Q. Are you connected with any of the other companies? — A. N"o sir. Well, I am a director in the Union Tank Line Company. Q. Any of the other companies? — A. No sir. Q. What is your particular branch of the business ? — A. I am gen- eral manager of the Long Island refinery of the Standard Oil Com- pany of New York. Q. And have been since 1879? — A. No sir. Q. What was your position before you became general man- ager ? — ^A. T was assistant general manager to Mr. Vose, who was the manager of the Pratt works, Standard Oil Company of New York. Before that I was clerk, and came up from a boy. Q. And have you any connection or oversight over the business of refining other than that of the Standard Oil Company 584 of New York?— A. No sir. Q. Are you a member of any committee or number of men who act together in relation to the refining branch of the Standard's business? — A. Not in any official way, no sir. Q. Well, in an unofficial way, then? — ^A. No sir. Q. You never meet and consult with the other officers of refineries, on the subject of the refining? — A. Oh, we have frequent conferences of the general managers of the different companies ; we have frequent conferences. Q. Well, with whom? — A. Well, of the managers of almost all of the works. Q. The managers of the other refineries. Who are they? — A. Well, there is Mr. Cowan, of Chicago. Q. What is his full name ? — A. W. P. Cowan. Q. What works is he manager of? — A. The works at Whiting. Q. At Whiting, Indiana? — A. Yes. Q. Where is his office ? — A. In Chicago. Q. With whom else? — A. Mr. Chamberlain, H. P. Chamberlain. Q. What works ? — A. The works at Buffalo. Q. At Buffalo, New York?— A. Yes. Q. What refining company is that? — A. That is the Standard Oil Company of New York. Q. Who else?— A. Mr. James Smith. Q. What company is he connected with? — A. The Standard Oil Company of New Jersey. Q. Bayonne refinery? — A. Bayonne refinery. 585 Q. And any other refinery than the Bayonne? — A. Not that I recall, no sir. Q. Who else?— A. Mr. George B. Gifford. Q. What Company is he connected with ? — A. Eagle works. Q. Where? — A. At Claremont, New Jersey. FOLGEK. 285 Q. The Eagle works, what company does that belong to ? — A. The Standard Oil Company of New Jersey. Q. What other men do you meet or consult with? — A. Well, I have met with Mr. J. W. Van Dyke. Q. What\;ompany?— A. He is of the Atlantic Refining Company. Q. Atlantic Eefining Company, of Philadelphia? — A. Yes. Q. Who else? — A. Well, there are several others in the building; Mr. H. L. Pratt. Q. Now, Mr. Folger, do you gentlemen meet and consult on the refining business frequently? — A. Yes sir. Q. How often ? — A. Oh, at indefinite intervals. Q. Well, every month ?— A. Oh, yes ; not— all of those gentlemen do not consult. You ask me whether I had consulted with these gentlemen or they had consulted -ndth me ? Q. Yes. — A. Yes sir. Q. Your office at 26 Broadway? — A. 26 Broadway. Q. Any other of these gentlemen have an office at 26 Broadway ? — A. Yes sir. Q. Who are they? — A. Mr. Smith has an office at 26 Broadway; Mr. Gifford has an office at 26 Broadway. I think that is all, that I have mentioned. 586 Q. Well, isnt your office the meeting place of these gentle- men when you meet? — A. It is more frequently a meeting, place than any other place, but it is not always the meeting place. Q. Now, in your office you keep the results of the refining busi- ness, do you not, in detail ? — A. Yes, I have pretty fair records of the refining business in detail. Q. And the results of that business you keep also for all the re- fineries of the Standard Oil group, do you not? — A. I have informa- tion about them all. I dont keep the information. I am not the headquarters for keeping it. Q. What is that ? — A. I am not the headquarters for keeping it, if that is what you mean. Q. Who is the headquarters for keeping it ? — A. There is no head- quarters for keeping it. Q. How is it furnished to you ? — A. It comes to me from the vari- ous offices of the several companies. Q. It is sent to you at certain periods ? — A. No, it is sent to me at irregular Q. Irregular periods? — A. Irregular periods, yes sir. Q. Every month? — A. Much of it comes every month, yes sir. Q. Usually once a month, doesnt it ? — A. Usually once a month. Q. Now, those statements come in the form of statements of opera- tion? — A. Yes; manufacturing operations. Q. Now. explain what those are, those statements, and what they show. — ^A. Well, we get statements which show the manufacturing costs and manufacturing yields. 286 POLGEE. Q. Of each separate refinery? — A. Yes sir. 587 Q- In the Standard Oil group, — I mean by that companies which the Standard Oil Company of New Jersey owns stock in, and you understand is connected with the Standard Oil group ? — A. Yes sir. Q. Are those statements sent to you direct ? — A. No sir. Q. Whom are they sent to? — A. That I cant tell, excepting that they come to me from the officers of several companies. Q. Yes, I say they come to you from the officers of the several com- panies, usually once a month. — A. Yes sir. Q. Now, you examine those, dont you? — A. I do. Q. And make suggestions, do you? — A. I do. Q. And do you keep those statements? — A. No sir. Q. What becomes of them? — A. They are most of them returned. Q. Most of them are returned? — A. Yes sir. Q. With your suggestions? — A. Yes sir. Q. To the managers of the various refineries? — A. Yes sir. Q. Do you keep any tabulated statement from them? — A. Yes, we keep some tabulated statements. Q. You keep the results of these various reports, do you? — A. As well as we can in a manufacturing line. Q. Do you enter them in books? — A. No sir. Q. How do you keep them ? — A. We keep them on sheets. Q. Made up in your office? — A. Made up in our office, yes. Q. By your clerks? — A. Yes sir. Q. You have a regular office for that purpose, do you not ? — 588 A. Yes sir. Q. And you are at the head of that department, are you not? — A. Yes sir. Q. And all refineries of the Standard Oil group report to you ? — A. I wish to make a distinction between the refineries reporting to me and the officers of the refineries reporting to me. Q. What distinction do you wish to make? — A. That I am not directly in contact with the refineries. Q. But the officers report to you? — A. My connection is through the officers of the company. Q. Do you know of any way that a refinery can act except through its officers, if it is a corporation? Mr. MiLBUEN. He means that the refinery people dont communi- cate with him. Q. The officers of the refineries communicate with you? — A. Yes sir. Q And you have general charge, then, over that subject of all of the Standard's refineries? — A. Not at all, sir. Q. Then, why are these sent to you? — A. They are sent to me for the help that they can get from me in looking them over. Q. Yes, you are an expert? — A. I am an expert, yes sir. FOLGEE. 287 Q. And the officers of each refinery report to you substantially every month the result of their operations ? — A. No sir. You would like to have me explain, would you ? Q. Yes, I want you to explain. — A. The refineries report to 589 their officers; their officers get these reports and send them to me. Q. That is what I said. The officers of the refineries report to you substantially every month the result of the operation of the refin- eries ? — A. I think there is a distinction between reporting to me and sending reports to me which their subordinates have sent to them. Q. Their subodrinates furnish it to them? — A. Yes. Q. And they furnish it to you? — A. They turn it over to me. Q. Substantially every month? — A. Yes sir. Q. A detailed statement showing the result of the operation of the refinery ? — A. Yes sir. Q. And you examine them? — A. I examine them, yes sir. Q. And you make suggestions to those officers? — A. Yes sir. Q. For what purpose? — A. To improve the results in the future. Q. Then you have general charge of that branch of overseeing that business, ha vent you; the branch of examining the results of these various refineries? — A. Yes sir. Q. And you keep an office for that purpose? — A. Yes sir. Q. And have clerks that keep tabulated statements of the results of the operations of these various refineries? — A. Yes sir. Q. Now, are those statements that are furnished you by the offi- cers, copies of them kept in your office? — A. Yes sir. Q. And from those statements you, tabulate certain information in a more condensed form for your office? — A. Yes sir. 590 Q. So that you always have before you the result of the operation of the various refineries of the Standard Oil group ? — A. In the manufacturing line, yes. Q. I mean in the manufacturing line. Now, how long have you had that position ?— A. I should think four or five years. Q. Who preceded you in that position? — Mr. A. M. McGregor. Q. Now, Mr. Folger, are you a member of the firm of Corsicana Eefining Company ? — A. Yes sir. Q. Do you know about that refinery?— A. Yes sir. Q. Where is it situated ?— A. Corsicana, Texas. Q. When was it constructed ? — A. In 1898. Q. Has it been in operation ever since ?— A. Yes sir. Q. Who are the members of the firm or the partnership known as the Corsicana Refining Company— A. Mr. C. N. Payne and myself. Q. What is Mr. Payne's business ?— A. Mr. Payne is vice president of the National Transit Company. Q. Been with the Standard Oil for many years?— A. Longer than I have, yes sir. Q. Who owns the Corsicana Eefining Company?— A. Mr. Payne and myself. 288 FOLGBE. Q. Who constructed it ? — A. It was built by Mr. J. S. Cullinan. Q. When did you and Mr. Payne take over the property ? — ^A. In 1906. 691 Prior to that time it was operated as the Corsicana Refining Company, wasnt it? — A. Yes sir. Q. In whose name was it? — A. In our name. Q. In whose ? — A. Our name, Corsicana Refining Company. Q. Yours and Mr. Payne's? — A. Yes sir. Q. Now, was that property constructed with money of the Stand- ard Oil Company or any of its subsidiary corporations? — A. It was built with the money of the National Transit Company. Q. In 1898?— A. In 1898, yes sir. Q. And when did the Corsicana Refining Company take it over, that is, yon and Mr. Payne? Mr. Rosenthal. What do you mean by taking it over ? Witness. I said in 1906. Q. I mean when did you take it into the name of the Corsicana Refining Company? — A. January 1, 1902. Q. The balance-sheet of the National Transit Company will be here pretty soon, but I show you a statement, a memorandum of items on the National Transit Company balance-sheet, which I wish you would look at. That is, of course, subject to correction when we get the original. (Handing witness paper.) The paper was marked Petitioner's Exhibit 34. Q. Petitioner's Exhibit 3-1 purports to be a statement from the an- nual balance-sheets of the National Transit Company, and subject to its correction, I ask you if on the books of the National Transit Com- l^any as of December 31, 1899, is an account "Accounts Receiv- 592 able C. N. Payne and H. C. Folger, Jr., $940,717.04." Do you remember that, Mr. Folger? — A. No sir. Q. Did you and Mr. Payne borrow money of the National Transit in 1899? — A. (After some hesitation.) You mean as indi- viduals ? Q. No, as the Corsicana Refining Company. — A. Oh, as the Cor- sicana Refining Company we did, yes sir. Q. And you and Mr. Payne were the Corsicana Refining Com- pany? — A. Yes sir, we were acting as the Corsicana Refining Company. Q. You were acting as a co-partnership? — A. As a co-partnership. Q. What was that money used for — the acquisition of the Corsi- cana plant? — A. For the building of the plant. Q. For the building of the plant ? — A. Yes sir. Q. It was really built by the National Transit? — A. They financed the entei'jDrise. Q. And owned it? — A. And owned it. Q. It was merely in your name for convenience? — A. We ran it for their benefit. Q. Then this iiccount which shows the item I mentioned was money advanced l)y (lie National Transit Company to construct that FOLGER. 289 plant? — A. Of course, I know nothing about that account, Mr. Kel- logg. Q. It did furnish the money to construct the plant ? — A. They fur- nished the funds for constn^cting the plant. Q. And was it about that amount, $940,000? — A. Yes sir. Q. I notice the next year, December 31, 1900, " Other In- 593 vestments C. N. Payne and H. C. Folger, Jr., $953,834.08 " and December 31, 1901, $1,381,354.32, and December 31, 1902, $1,135,756.91, and December 31, 1903, $753,050.93; December 31, 1904, $556,420.04, and December 31, 1905, $415,723.91. Each one of these years, from and including December 31, 1900, down to December 31, 1905, are under the head of Other Investments, C. N. Payne and H. C. Folger, Jr. Now, will you explain those items, Mr. Folger? — A. I can not, sir. Q. Well, you received the money, or the Corsicana Refining Com- pany did, from the National Transit Company? — A. Yes sir. Q. To construct this plant? — A. Yes sir. Q. Did you sign any notes or papers to the National Transit, or was the money simply charged on an account? — A. I dont know how they charged it or how they handled it on their books. Q. But they furnished the money? — A. They financed the enter- prise. Q. Did it cost somewheres in the neighborhood of $1,335,000 as appears by the largest item on this statement ? Mr. Rosenthal. That probably includes cost involving purchase of oil. Mr. Kellogg. Possibly. Mr. Rosenthal. That is not cost of plant. Mr. Kellogg. I presume not. Q. Wliat is your recollection about the cost of that plant? — 594 A. Oh, I should think that was too large for that plant ; it is a comparatively small plant. Our books at Corsicana will show. Mr. Rosenthal. That represents plant, oil and everything else. Mr. KJELLOGG. Well, that can be explained by somebody else. Mr. Rosenthal. Yes. Q. You couldnt explain the items of the account ? — A. No sir, I have nothing to do with the accounts of the National Transit. Mr. Rosenthal. Dont you know, then, that that large amount rep- resents, in addition to the initial cost of the plant, an amount of money you had invested in the oil which was then in tankage? Witness. It undoubtedly does, yes sir. Mr. Rosenthal. And whatever other products might be on hand. There is no question about that. Mr. Kellogg. That is probably the total investment of the National Transit Company in that business. Q. Now, why does the account fall off and decrease from $1,381,000 to $415,723.91 ? — A. Well, our investment there declined as the field 32555—08 19 290 FOLGER. declined. The enterprise started with a considerable production at Corsicana. We accumulated a stock of oil, but the field now has almost entirely disappeared. Q. Well, the income from the plant, then, was probably credited on this account? — A. That I dont know, sir. 595 Q. Well, who does keep the books showing that investment ? Mr. Rosenthal. Well, is not that probably true, Mr. Folger? Witness. What is that? Q. Isn't it probably true, as Mr. Eosenthal asks, that that income was credited on this investment account and is the cause of its decreasing? — A. Probably, yes sir. Q. Now, who keeps the books showing the results of operation of the Corsicana Refining Company ?^A. Well, they are kept in the oiRce of the National Transit Company. Q. In the National Transit Company? — A. Yes sir. Q. Here in New York? — A. No sir, at Oil City. Q. At Oil City, Pennsylvania? — A. Yes sir. Q. Who has charge of that company's affairs? — A. The controller. Q. Who is he ?— A. Mr. Chesebro. ' Q. George Chesebro. Then he can show the exact result of the operation of the Corsicana Refining Company? Mr. Rosenthal. I think we can give you a statement showing that. Mr. Kellogg. All right. Mr. Rosenthal. We will undertake to do that. Mr. Kellogg. All right. Mr. Rosenthal suggests they will give us a statement showing the result of the operation of the Corsicana Refining Company. 596 Q. That business continued to be owned by the National Transit Company down to what time? — A. 1906. Q. What time in 1906 ?— A. June 15. Q. Then what became of it? — A. At that time Mr. Payne and I purchased the plant. Q. What did you pay for it?— A. We paid about $992,000. Q. Have you got any books showing the exact amount you paid for it? — A. I have a memorandum, yes sir. Q. Let me see it, please. Witness produces paper and hands same to Mr. Kellogg. Q. You show me a pencil memorandum, " Cost of property June 15, 1906, $992,644.15."— A. Yes sir. Q. Is that the only book or memorandum you have showing the transaction? — A. Yes sir. Q. Wlnat did you pay — cash? — A. No sir. We undertook to pay for the plant in ten years. Q. You undertook to pay for the plant in ten years. Did you have a written contract? — A. No sir. Q. A verbal contract? — A. Yes sir. Q. With whom did you make your arrangement? — A. Mr. J. D. Archbold. Q. Mr. John D. Archbold?— A. Yes sir. EOLGBE. 291 Q. About that time? — A. About that time, yes sir. Q. And you paid no cash ? — A. No cash, no sir. 597 Q. How was this figure of $992,644.15 arrived at?— A. Mr. Archbold told me it represented the investment at that time. Q. Did you inquire into it to see whether it did or not?— A. Oh, yes. Q. Did you have the books examined ? — A. Yes. Q. Who examined them for you ?— A. I looked at them myself. Q. Where were the books ?— A. Where were the books ? Q. Yes. — A. The account was at 26 Broadway. Q. ^Yho keeps them? — A. Mr. Chesebro. Q. He has an office at 26 Broadway? — A. Yes sir. Q. And he keeps, then, the accounts of the Corsicana Eefining Company there ? — A. Yes sir. Q. And not at Oil City ? — A. They are kept both there and at Oil City. Q. They are kept at both places? — A. Partly there and partly at Oil City. Q. You looked over the accounts with Mr. Chesebro? — A. Yes. Q. And what did that account show in a general way ? Have you got a statement of it with you ? — A. I will see. I dont think I have, sir. That is the account as it stands for December 31, 1905. This trade was made on June 15, but it was on the basis of the showing of the investment on December 31, 1905, back at the last inventory. Q. I see. That was the investment of the company at the last in- ventory, when the balance-sheet was taken off December 598 31, 1905. — A. And we took the property over on that valuation. Q. Did you get a deed for the property ? — A. We needed no deed. Q. It had always stood in your names, had it? — A. Always stood in our name. Q. The property in your name or Mr. Folger's? — A. It stands in the name of Q. I mean Mr. Payne. — A. It stands in the name of the Corsicana Refining Company. Q. The Corsicana Company is a mere partnership, isnt it? — A. Partnership, yes sir. Q. So there was no change in the legal title at that date ? — A. No change in the legal title at that date. Q. You simply agreed to pay in ten years this sum of money? — A. Or as much sooner as we could. Q,. You paid no cash? — A. No cash. Q. W^as the arrangement that it was to be made out of the prof- its? — A. No sir. Q. Nothing said about that? — A. No sir. Q. You simply looked' at the balance-sheet and saw the investment of December 31, 1905, and took over the property? — A. We bought the property, yes sir. Q. WTiat? — A. We bought the property. 292 FOLGEE. Q. Did you agree to pay any definite sum per year? — A. No sir. Q. Gave no note? — A. No note. Q. No contract in writing? — A. No contract in writing. 599 Q. Any interest on the money ? — A. Yes sir. Q. At what rate? — A. Six per cent. Q. Six per cent interest annually? — A. Annually. Q. Have you kept any books of the operation of the Refining Com- pany since that time? — A. We have always kept books of the opera- tion of the Refining Company. Q. Well, the National Transit Company has kept them, hasn't it? — A. No sir, they have been kept at Corsicana, Texas. Q. Well, I know, but the National Transit Company has always kept an account at 26 Broadway showing the results of the operation of that company, hasn't it? — A. They have shown the results of financing the company. Q. Oh, not the details of the business? — A. No sir. Those are kept at Corsicana. Q. But the National Transit Company books have shown the financial results of the operation each year, haven't they? — A. That I can't say. Q. Well, you have not kept any such books, have you? — A. We kept the books at Corsicana, yes sir. Q. I mean here at New York; you and Mr. Payne. — A. No sir. Q. You have kept no books except those kept at Corsicana? — A. No books except those kept at Corsicana. Q. Have you received any reports from Corsicana other or dif- ferent than you received before the time of your purchase? — A. No. 600 Q. Since your purchase has Mr. Chesebro kept the financial results of the operation? — A. Yes sir. Q. In other words, the business has gone on in exactly the same way as it did before you purchased it, hasnt it? — A. Yes, so far as our oversight is concerned. < Q. No money frqm the operation of the plant has been paid to you or to Mr. Payne, personally ? — A. Oh, yes, we have had money from the plant. Q. How much ?— A. We have had about $45,000. Q. And has it been credited on the purchase price? — A. Oh, yes; charged on the purchase price. Q. Well, credited on the purchase price. — A. I thought you meant had we taken any money from the operations of the plant. Q. Yes. — A. Well, we have, yes. Q. What has become of it ? — A. Well, I spent my share ; I suppose Mr. Payne spent his. Q. Did you apply it on the purchase price? — A. No sir. Q. You didn't?— A. No sir. Q. Have you made any payments on this purchase price ? — A. Yes. Q. How much?— A. There was $109,000. Q. When was it applied? — A. That was applied at the end of 1906. FOLGEE. 293 Q. December 31, 1906?— A. Yes. Q. I notice an account on the books of the National Transit Com- pany as of December 31, 1906, "Accounts Payable, C. N. Payiie 601 and PI. C. Folger, Jr., $536,259.11." What is that account?— A. I dont know, sir. Q. Do you owe them that amount of money? — A. "We owe them more than that. Q. You owe them more than that? — A. Certainly. Q. You can not explain that account, can you ?— A. I cant explain that, no sir. Q. Well, you took the profits, did you, commencing June 16, was it? — A. Xo, January first. Q. Oh. Does the National Transit Company owe you any money? — A. Do they owe us any money? Q. Yes. — A. No sir. Q. This purports to be an account payable by C. N. Payne, and H. C. Folger to the National Transit Company, $536,259.11. Can you explain that ? — A. I cant, no sir. Q. You dont owe them anything? — A. No sir. Q. I mean they dont owe you anything; that is, the National Transit Company doesn't owe you anything ? — A. No sir. Mr. Rosenthal. Doesn't that represent the amount of cash that was on hand at the time of the transfer ? Witness (after referring to papers). That probably is the expla- nation. I am not familiar with that account at all. Q. That probably represents, you say, the cash on hand at the time of your Mr. MiLBtnRN. Purchase. Q. Purchase. — A. There was cash on hand at the time of our pur- chase; that I dont know. 602 Q. You dont know what that account does mean, do you? — ^A. No sir. Q. The Transit Company does not owe you anything as far as you know? — A. No sir. We have had a deposit with the Transit Com- pany always, a considerable sum of money, four or five hundred thousand dollars. Q. That is, referring to the time prior to your purchase, which I understand was as of the date of December 21 or January 1, 1906. That is correct, is it? — A. That is right. Q. Prior to that date, the Corsicana Eefining Company was owned, as you say, by the National Transit Company ? — A. Yes sir. It was managed by us for account of the National Transit Company. Q. And stood in youi' name ? — A. Stood in the name of the Corsi- cana Refining Company. Q. And the Corsicana Eefining Company kept its books of the details of its operation at Corsicana, Texas? — A. Correct, sir. Q. And the financial results of that operation were reported to the controller's oiRce of the National Transit Company, and kept there? — A. Yes sir. 294 POLGEB. Q. Both at Oil City and New York? — A. Now, you see, you are getting into a realm where I am very little informed. Q. You paid very little attention to it? — A. Yes, that was right. Mr. MiLBUEN. That was what? 603 Witness. I was directing the manufacturing, the running of the plant and the management of it. I knew that the Tran- sit Company was financing the entei'prise. Q. So you paid very little attention to it? — A. That is right. Q. But you know in a general way that the financial results were kept by Mr. Chesebro, or the controller, whoever he was, at 26 Broad- way; you knew that in a general way? — A. I laiew it was kept on the books of the National Transit Company, yes sir. Q. Now, after January 1, 1906, was there any change in the manner of keeping them? — A. No sir. Q. Been kept in the same wa.y ? — A. Yes sir. Q. As far as you know? — A. Yes sir. Q. You have taken no more or different charge of the business than jou had before? — A. Oh, I think I have been a little more careful to look into the financial matters than I was before. Q. Yes, but the books have been kept, as far as you know, in the same way? — A. Oh, yes. Q. The reports have been made to the National Transit Company in the same way? — A. The reports have never been made to the National Transit Company. Q. Well, the books have been kept, then, of the financial operations, by the National Transit Company, in the same way? — A. I presume they have, yes sir. 604 Q. You have not kept any individually? — A. No sir. Q. Has Mr. Payne kept any individually? — A. Not that I know of. Q. Then there has absolutely been no change in the management, in the manner of reporting and keeping the accounts, both in Corsi- cana and at 26 Broadway, from what there was before? — A. No sir, there was no occasion for that. Q. And the whole transaction was a verbal understanding between you and Mr. Archbold? — A. Exactly. Q. Involving nearly a million dollars ? — A. Yes sir. Q. You have no written agreement evidencing that understand- ing? — A.. No sir. Q. Now, is it not a fact that the profits of the Corsicana Refining Company since January 1, 1906, have been taken by the National Transit Company and credited on your obligations, whatever it is? — A. Why, certainly. Q. Yes, that is what I understood. So that the money has not actually come into your personal hands? — ^A. It all comes into my hands personally. Q. Have you received it in the form of checks ? — A. Certainly. Q. And endorsed them over to the National Transit? — A. No sir. FOLGEE. 295 Q. From whom did you receive the checks? — A. I received the checks from the Corsicana. Q. From whom, what individual? — A. From our manager 605 and assistant down there, Mr, Brown and Mr. Proctor. Q. Sent to you personally * — ^A. Yes sir. Q. Or to Mr. Payne personally ? — A. Sent to me personally. Q. Sent to you personally. How often? — A. Why, sometimes once a day and sometimes once a week. Whenever they have money they send it to me. Q. Do you keep any account yourself of that money, in your books? — A. Why, yes, I deposit it. Q. In your office? — A. I deposit the money. Q. Deposited the money? — A. Certainly. Q. To whose credit? — A. To my own credit. Q. In the bank? — A. In the bank. Q. All the money that comes from the Corsicana Refining Com- pany? — A. Yes sir. Q. And do you keep an account of that in your office? — A. Why, certainly ; I have a memorandum of it. Q. Where are the books ? — A. In my office. Q. What do those books show as to the operations of the Corsicana Refining Company? — ^A. They show the receipt and the deposit of this money, Q. How much have you received since January 1, 1906? — ^A. Oh, I cant tell you. Q. Your books will show, will they? — A. When I get the money I turn it over to the National Transit Company. Q. When I get the money I turn it over to the National Transit Company. Q. That is what I asked you. You turn it over to the Na- 606 tional Transit Company, dont you ? — A. I deposit it, and then I pay the National Transit Company, certainly. Q. Very well. That is, you deposit it first to your own account, do you? — A. Certainly. Q. And then you give the National Transit Company a check? — A. Yes sir. Q. And you have turned over to the National Transit Company every dollar that you have received from the Corsicana Refining Company since January 1, 1906, have you? — A. Certainly. Q. So you have not spent it yourself, outside of paying it over to the National Transit Company? Mr. MiLBUEN. He said he had $40,000. That is what you asked him about. Mr. Kellogg. He just said he had turned over every cent. Mr. MiLBUEN. Oh, no. Mr. Kellogg. I so understood you. Q. You have turned over every dollar which you received since January 1, 1906, haven't you? — A. There should be excepted this money which Mr. Payne and I had, certainly. 296 FOLGEB. Q. Well, is it excepted? — A. It is excepted, certainly. Q,. How did you happen to take out $45,000?— A. Well, Mr. Payne wished the money, and I was quite willing to take it out. Q. Did you have any talk with Mr. Archbold about that? — A. No sir. Q. Was there any agreement about salaries? — A. No sir. 607 Q. Any agreement about how much you were to keep out? — A. No sir. Q. And you have kept out $45,000, out of that money, have you ? — A. Yes sir. Q. When did you take that out? — A. Some time in April. Q. Of this year? — A. Yes sir. Q. Just exactly $45,000 ? — A. It was not an exact sum, no sir. Q. Have you any books showing the exact amount? — A. I ought to have a memorandum somewhere. (Referring to pajDers.) No, I have no memorandum here, sir. Of course, I can tell you the exact amount. Q. Do you keep a book at the office showing all the sums you re- ceived and the sums you have paid over to the National Transit Com- pany, and the dates of your payment and the amount that you have received which you have retained? — A. I keep this check-book that I referred to, which shows the receipts and the payments to the National Transit Companj'. Q. Oh, you keep on the stubs of your checks the amount you re- ceived? — A. Yes. This $45,000 was drawn from the National Tran- sit Company by us. Q. Was drawn from the National Transit Company by you? — A. Yes sir, certainly. Q. Well, it was not taken from money you received from the Corsi- cana Refining Company? — A. Not directly, no sir. Q. Then, all the money you have received from the Corsi- 608 cana, as you said before, has been paid right over to the National Transit Company? — A. Yes sir. Q. Now, the $45,000 you got from the National Transit ? — A. Cer- tainly. Q. And that has been charged to you on the books of the National Transit? — A. I presume it has, yes sir. Q. As an obligation against you? — A. In this account, yes sir. Q. Then, as a matter of fact, the National Transit Company has carried the Corsicana Refining Company on its books in exactly the same manner since you purchased it as it did before; has received the income and charged it against the plant? — A. That is right, yes sir. Q. That is right, isn't it ? — A. Yes sir. Q. That is what I thought. And the only change is your verbal talk with Mr. John D. Archbold ? Mr. Rosenthal. That is hardly fair. The last question was read. FOLGEE. 297 Mr. Rosenthal. The only change in Avhat, Mr. Kellogg? Q. The only change in the management of the property was simply your verbal understanding with Mr. Archbold. Do you understand what I mean ? — A. Yes, I understand what you mean. Yes, I think that was Q. Now, is Mr. Archbold an officer of the National Transit Com- pany? — A. Yes sir. 609 Q. What is his official title, do you know? — A. He is a director. I dont know what other position he has. Q. He is not an officer, is he ? — A. I cant say, sir. Q. He is an officer of the Standard Oil Company of New Jersey, isn't it? — A. Oh, yes. May I put in something there to make the record a little clearer? Q. Certainly. — A. Our talk leading up to this purchase was made with Mr. Daniel O'Day. He was then the vice president of the National Transit Company. Mr. . O'Day was taken ill and went abroad and died. We had to continue the negotiations with some one else, and Mr. Archbold took it up. Q. Now, the refinery was constructed by the National Transit Company in 1898 and 1899, was it? — A. The refinery was constructed in 1898 by the Corsicana Refining Company, the funds being fur- nished by the National Transit Company, yes sir. Q. Now, what was the object of putting the Corsicana Refining Company in the name of you and Mr. Payne? — A. That I dont know, sir. Q. Who originated the idea? — A. Apparently, Mr. O'Day, as far as my knowledge goes. Q. Did he give you the directions? — A. He was the one who had the first talks with me about the Corsicana Refining Company. Q. Was it under his direction that you constructed it ? — A. I can't say that, no sir. Your meaning is not quite clear. 610 Q. How came j'ou to construct the plant of the Corsicana in your name and in Mr. Folger's name ? — A. Mr. Payne's name, you mean ? Q. Mr. Payne's name, yes. — A. We constructed it in the name of the Corsicana Refining Company. Q. Well, the Corsicana is a simple partnership consisting of you and Mr. Payne ? — A. Yes sir. Q. Now, what I want to know is how did you come to construct it; who directed you? What was the understanding? — A. So far as I am concerned personally? Q. Yes sir. — A. That is right. In 1898, on the date you speak of, the early part, of 1898, Mr. O'Day had several talks with me and with Mr. Payne about the production of oil in Corsicana, and said that he wished some arrangement made to take care of the production, and that if I was willing, he would like to have me undertake the charge of building the plant and running it from the manufacturing stand- point, I being a manufacturer. 298 FOLGEE. Q. Did he suggest that it be put in the name of the Corsicana Ee- fining Company? — A. He said if I was willing they would put it in the form of a partnership, yes sir. Q. You and Mr. Payne ? — A. Yes sir. Q. Was Mr. Payne present ? — A. Yes sir. Q "\'\^iat reason did he give for wishing to put it in your name ? — A. He gave no reason to me. Q. None whatever? — A. No sir. Q. Did you make any inquiries? — A. No sir. 611 Q. Save you any other properties of the Standard Oil in your name ? — A. No sir. Q. Have you ever had? — A. No sir. Q. Oh, I dont mean the stock of the sub-companies. — A. I sup- posed that was the case. Q. Exclusive of the holding of stocks. — A. I understood, yes sir. Q. You know, then, of no reason why it was put in the name of the Corsicana Refining Company, composed of you and Mr. Payne, except Mr. Day asked to have it done? — A. Mr. O'Day, yes sir. Q. Mr. O'Day, I mean. — A. Yes sir. Q. Did you and Mr. Payne prepare articles of co-partnership? — A. Yes sir. Q. Agreement in writing? — A. Yes sir. Q. Have you it? — A. Yes sir. Q. Will you let me see it, please? Witness hands paper to Mr. Kellogg. Q. You wish to keep this original document, I suppose? — A. I would like to. Mr. Kellogg. We may substitute a copy, Mr. Rosenthal? Mr. Rosenthal. Yes. Q. The articles which you have shown me, dated the 5th day of May, 1898, between J. S. Cullinan of Washington, Pennsylvania, C. N. Payne, and H. C. Folger, Jr., are the articles you refer to? — A. Yes sir. 612 Mr. Kellogg. I offer the original articles in evidence, and it is agreed that a copy may be substituted and the original re- turned to the witness. Is that correct, Mr. Rosenthal ? Mr. Rosenthal. Yes. The copy will be marked Petitioner's Exhibit 35. Q. Who is Mr. Cullinan? — A. Mr. Cullinan is now president of the Texas Company, of Texas. Q. He is no longer a member of this firm? — A. Oh, no sir. Q. I notice that his interest in the firm was to be $5,000 per an- num. — A. Exactly. Q. Is that a salary, representing his salary? — A. It represents $5,000. Q. Well, he didn't get $5,000 out of the income of the company, did he? — A. Yes sir. Q. Well, he got it as a salary, didnt he? — A. I shouldnt say so. POLGEE. 299 Q. Isnt it a fact that all of the income — the net income — went to the National Transit Company?— A. Before he drew his $5,000? _ Q. No, no ; all of the net income of the company went to the Na- tional Transit Company. — A. Oh, yes sir. Q. And he simply got $5,000 a year ?— A. That is right. Q. He got it whether they made any profit or whether they didnt, did he? — A. The articles say so. Q. And that is all he did get?— A. Certainly, that is all he got. 613 Q. He got no salary, did he? Did you pay him any sal- ary? — A. In addition to the five thousand? Q. Yes.— A. No sir. Q. Now, the balance, (hat says, is to be divided between you and Mr. Payne? — A. Yes. Q. It was actually turned over to the National Transit Company, wasnt it? — A. It was, yes. Q. When did Mr. CuUinan leave the partnership ? — A. At the end of 1901. Q. Did you have any otlaer articles of agreement than those? — A. No sir. Q. This is the agreement dated the 31st day of December, 1901, between J. S. CuUinan, of Corsicana, Texas, C. N. Payne, and H. C. Polger, Jr., providing, in substance, that CuUinan withdraw from the firm, and that his name be not further used ; that is tlie substance of it? — A. That is the substance of it, yes sir. Mr. Kellogg. We offer the original in evidence, and it is stipulated that a copy may be substituted for the original ; is that correct ? Mr. Rosenthal. Yes. The same was marked Petitioner's Exhibit 36. Q. Did you have any other agreement in relation to the business? — A. Yes sir; here is another. (Handing paper to Mr. Kellogg.) Q. When was this made? — A. That was made on the same date. It ought to be connected with the other. 614 Q. Well, this is an agreement in which Mr. CuUinan with- draws and Liorees to act as manager for two years for $8,000 per year? — A. Exactly. Q. This was made on the same date as this other agreement in which he withdrew from the firm? — A. Yes. Mr. Kellogg. It is offered in evidence as a part of it, as Exhibit 37, and a copy may be substituted in lieu of the original. Witness. You wish it complete? Mr. Kellogg. Yes. The witness hands Mr. Kellogg another paper. Mr. Kellogg. The last agreement is continuing the firm under the name of the Corsicana Eefining Company, signed by C. N. Payne and H. C. Folger. This we offer in evidence as Exhibit 38, and it is stipulated a copy may be substituted in lieu of the original. Q. At the time i\Ir. CuUinan retired he agreed to continue for two years as the manager at a salary of $8,000 a year? — A. Yes sir. 300 FOLGEK. Q. You say he then retired from the firm, I mean from the business of the jfirm, after that two years?— A. At the expiration of the two years, yes sir. Q. And organized what company? — A. I dont know what com- pany he organized. Q. Well, he is with what company ? — A. He is at present the presi- dent of the Texas Company. Q. Now, coming back to this time you purchased the busi- 615 ness from Mr. Archbold. What understanding did you have with Mr. Archbold as to the manner of the payment? — A. We were to pay as much money as we could, but to make the full payment before the expiration of ten years. Q. Were you to pay simply the profits of the concern ? — A. No sir. Q. Nothing said about that? — A. Nothing said about that. Q. Any agreement that you should not be personally liable for this? — A. That we should be personally liable? Q. Yes. — A. Oh, no. Q. No agreement at all? — A. No. Q. Now, what reason was there for taking over the Corsicana Re- fining Company as of the first day of January, 1906? — A. Well, all through the Spring of 1906 Mr. O'Day had talked with Mr. Payne and me to the effect that the National Transit Company felt con- cerned about having property in Texas, they wished to get away from it, and they urged us to find some way of disposing of the property, sell the plant. Q. Why was the National Transit Company concerned in having property in Texas? — A. Well, as far as I could gather, it was on ac- count of legal conditions in Texas. Q. In Texas? — A. Yes sir. Q. And so the plant was taken in your name to avoid those legal conditions? — A. No sir. Q. Well, purchased by you, then? — A. We purchased it because we thought it was a good thing to do. 616 Q. Well, to whom do you sell your oil? — A. We sell it to any buyer we can find. Q. Well, that is not the question. To whom do you sell it? — A. Well, I presume we have a hundred customers. Q. Dont you sell it all to the Waters-Pierce Oil Company! — A. Oh, no sir. Q. You dont?— A. No sir. Q. Does the Waters-Pierce Oil Company buy much of the refined oil? — A. The Waters- Pierce Oil Company buys nearly all of our refined oil. Q. Substantially all of it, doesn't it ? — A. Yes sir. But you should understand that the refined oil made from Texas crude is only a small part. Q. I understand that. — A. Yes sir. Q. I was asking you as to refined oil. — A. Yes sir. FOLGEE. 301 Q. The Waters-Pierce Company buys the refined oil ?— A. Most all of it, yes sir. Q. Doesn't it buy all of it?— A. It has not bought it all, no sir. Q. Well, substantially all?— A. Substantially all, yes sir. Q. And the Waters-Pierce markets that oil itself, doesn't it?— A. Yes. Q. Now, what are the other products you make? What percentage do you make from this Texas oil? Or refined oil, I mean? — A. I should say we made about 45 or 48 per cent. Q. '\'\Tiat other products do you make? — A. We make about 617 10 per cent of naphtha. Q. Where do you sell that ? — A. That is sold to the Waters- Pierce Company. Q. AVliat else do you make? — ^A. Fuel oil. Q. Does the Waters-Pierce Oil Company handle fuel oil? — A. Oh yes. Q. Where do you sell your fuel oil? — A. We sell some to them, and then to other buyers. Q. Local in Texas, or A. Entirely in Texas. Q. Entirely in Texas? — A. Yes. Q. The Waters-Pierce Company, however, ships oil out of Texas, doesnt it? — A. That I do not know. Q. You dont know what it does do? — A. No sir. Q. Well, what other products do you make? — A. Those are all the products. Q. Those are all? — A. Yes sir. Q. Do you know how much of your total product the Waters- Pierce handles? — A. I should think they handle about one-half of it. Q. About one-half? — A. Yes. Q. Do your books show? — A. Oh, yes. Q. Do the books here in New York show ? — A. Oh, no sir. Q. They would show from Texas ? — A. Yes sir. Q. You could get a statement from your books, could you not, showing the total production of each class and the amount sold to the Waters-Pierce? — A. Certainly, yes sir. 618 Q. Will you get us that statement ? — A. Yes sir. Q. Do you sell any of the product to any other Standard concerns? — A. No sir, not at present. Q. HaAe you ever? — A. Oh, in the early days we sold our refined oil product to the Standard Oil Company, of Indiana. Q. Well, I mean in the last few years. — A. No sir. Q. No other Standard Oil concern except the Waters-Pierce buys any of your product, of the Corsicana Eefining Company? — A. No other concern. Q. You are sure of that? — A. Kefined oil and naphtha, you mean? Q. No, any of the products of that refinery.— A. I told you we had seventy-five or one hundred customers. 302 FOLGEE. Q. Are any of those customers any other companies of the Stand- ard Oil, I mean ? — A. Oh, yes. I think we have sold some gas oil to the Standard Oil Company of New York. Q. What I want in your statement is your total product of each class. Then I wish the total amount sold to the Waters-Pierce, or and other company in which the Standard Oil Company is a stock- holder, or controls. You Icnow what I mean. — A. I understand, yes. Q. You will have that made up ? — A. Certainly. Q. Can you make it up say for the last three years ? — A. I should think so, yes sir. Q. Besides being an official of one of the Standard Companies, you are a large stockholder of the Standard Oil Company, 619 are you not? — A. I am a stockholder, yes sir. Q. I think the record is in evidence, but do you remember the amount ? — A. Yes sir. Q. What is the amount? — A. Do I have to put that on record, sir? Q. It is all in evidence. — A. Yes. Q. I just Avant to connect it up with this testimony here. — A. Of course, if it is a matter of record, all right, but I dont care to have my personal affairs Q. All right, it is in evidence now, and I will withdraw it if you have any objection, Mr. Folger. What do you know of the Security Oil Company? — A. Nothing at all, sir. I have heard of that com- pany, but I know nothing of it. Q. Have you ever seen the plant? — A. I have not, no sir. Q. Have you e^'er seen any statements of its operation ? — A. No sir. Q. Do you know anything about who is the manager of it? — A. No, I do not, sir. Q. Did you ever know Mr. F. W. Weller ? — A. Oh, yes sir. Q. Isn't he the manager? — A. No, sir, he is not. Q. He was, wasn't he, up to a short time ago? — A. He was, yes sir. Q. For how long ? — A. I cannot tell, sir. Q. Well, for a number of years, wasn't he? — A. Several years, yes sir. Q. He had headquarters down here at the Standard Oil 620 Building, too, didn't he ? — A. No sir. Q. Isn't there a door down there with his name on it? — A. Certainly. Q. What was he doing in the office? — A. He was managing the Bergenport Chemical Works. Q. When was this? — A. During the past year or six months. Q. The last year, or year and six months, you say? — A. No, I said last six months or year. Q. Is he now the manager of that company? — A. He is. Q. What is the name of it? — A. Bergenport Chemical. Q. Is that one of the Standard concerns? — A. Yes. Q. Did he come from Texas to take charge of that? — A. I think not, no sir. FOLGEE. ,303 Q. Where is he now? — A. I do not know, sir. Q. Is his home in the city? — A. I do not know, sir. Q. How do you know that he is the manager of that company ? — A. Why, I have met him in connection with that company, and his name is there on the door ; I have been in his office and seen him. Q. How long since? — A. Perhaps four or five months ago, before 1 went on my vacation. Q. When did he leave the Security Oil Company?— A. I don't know sir. Q. Well, prior to that time he was with the Security Oil Com- pany, wasn't he? — A. Yes sir. 621 Mr. Rosenthal. Prior to what time? Mr. Kellogg. Prior to the time he became the manager of the Bergenport Chemical Company. Witness. No, I think not, sir. I think he left the Security some time before that. Q. Well, that was prior to that, wasn't it? — A. Oh, yes, prior; but not immediately prior. Q. Oh, I didn't ask you immediately prior. Now, in the mean- time, was he employed by any other Standard concern? — A. Not that I know of. Q. You don't know? — A. I don't know. Q. What other parties who have been managers of the Security Oil Company do you know, or connected with it ? — A. Well, if you would name them I might be able to answer. Q. Do you know Mr. H. C. Bayne, president of the Seaboard Bank? — A. No, sir. Q. And you have never seen any papers or reports of any kind showing the operation of the Security Oil refining company? — A. That is right ; I have never seen any papers. Q. Did you ever talk with Mr. Weller about it when he was mana- ger? — A. No sir. Q. You know nothing about it, absolutely? — A. That is right, absolutely, no. Q. When was the Texas Company organized? — A. Oh, I can't give you the date. Q. Where is this refinery situated? — A. Either at Beau- 622 mont, or near Beaumont, in Texas. ]Mr. Gkeer. Port Arthur. Q. Port Arthur ? — A. In Port Arthur, yes. Q. About how long was that refinery built? Mr. EosENTHAL. Is that the Security? Mr. Kellogg. The Texas company. Witness. No, we are talking about the Texas company. I would have to guess, Mr. Kellogg. Q. You have no recollection ? — A. Well, I have an indefinite recol- lection ; five or six years ago. Q. It was built after Mr. CuUinan left your concern, or about that time? — A. Oh, some time after he left us. 304 POLGEB. Q. Some time after he left you? — A. Yes sir. Q. Did he go immediately to the Texas Company ? — A. That I do not know, sir. Q. Have you seen any statements of the operations of the Texas company? — A. No sir. Q. Have you any interest in it? — A. None whatever. Q. Any Standard concern, as far as you know? — A. As far as I know, none whatever. Examined by Mr. Geeee : Q. Mr. Folger, Mr. Weller did not have an office at 26 Broadway when he was connected with the Security? — A. Certainly no, no sir. Q. He was in no way connected with 26 Broadway, or the Stand- ard Oil Company, at that time? — A. Not until later, no sir. 623 Q. Hasn't it been some two or three years since he was con- nected with the Security? — A. I think it was, yes sir. Cross-examination by Mr. Rosenthal. Q. The fact of the matter is, is it not, that the officers of the National Transit that you talked with in the spring of 1906 advised you that they were exceedingly anxious to get rid of the Corsicana plant, by reason of the legal situation in the State of Texas? Isn't that the fact ? — A. That is what I luiderstood, yes sir. Q. And that, because of the tremendous anxiety on their part to get rid of that plant, they were willing to make nio:-t any sort of a bargain with you for its acquisition ; isn't that the fact ? — A. Or with any one else. Q. What? — A. Or with any one else. Q. Yes sir. Now, while this transaction on i(s face involves in round numbers about one million of dollars, isn't it true that as a matter of fact there was only about $400,000, in the last analysis, that was involved in that purchase? — A. Yes, between $400,000 and $450,000. Q. And that is true, because something over $500,000 was cash, which the National Transit Company retained in its treasury and which was used for the purpose of financing and operating that busi- ness? — A. Yes sir. Q. And which, in the event of a default, they would have 624 had in their possession throughout, and did have in their pos- session throughout ? — A. And still have, yes sir. Q. And still have ? — A. Yes sir. Q. The change in ownership required no other change in any direc- tion whatever, did it, because you had always theretofore operated it, had you not? — A. We had ahvays operated it. Q. It is true, is it not, that this entire plant was originated by and created by the National Transit Company ? — A. Yes sir. Q. In the first instance? — A. Yes sir. Q. And all of the money that went into the creation of this prop- erty was the money of the National Transit Company ? — A. I so said to Mr. Kellogg. FOLGER. 305 Q. And before the National Transit Coriipany created the Corsi- cana Eefining Company, there ^vas no property there, was there ? — A. There was no property- there. Q. It built that refinery ? — A. It built the refinery. Q. It originated that business? — A. It did. Q. And during all the years that it owned the business, I assume there could not have been any combination in restraint of trade be- tween the parent and its creature, could there ? Mr. Kellogg. Are you asking him as a lawyer or as an individual ? Mr. Rosenthal. Oh, as an individual. A. I should think not. Q. So far, whatever payment you have made there has been made out of the profits of the Corsicana? — A. Yes; that is what 625 I have testified. Q. And those are substantial profits? — A. ^Vhy, certainly. Q. And you have no apprehension whatever, have j'ou, as to the ability of that company, out of its own profits, to pay the 4 or 5 hun- dred thousand dollars that it Avill have to pay within the period of ten years ? — A. We hope to do it in much less time, yes sir. Examined by Mr. Kellogg: Q. I understand that the plant cost in the neighborhood of a million dollars? — A. We obligated ourselves; to pay for the plant (you have the figure) $992,000. Q. Yes, but with it you got about $650,000 of cash ?— A. Exactly ; working cash. Q. Working cash? — A. Working cash. Q. So that you really paid $400,000 or $450,000 for it?— A. Yes sir. Q. Now, originally it cost about a million dollars, did it? — A. Not the plant. Q. Well, the investment there by the National Transit Company was originally $1,381,354.32, wasn't it? Mr. EosENTHAL. I think that has been fully gone into on the direct. Mr. Kellogg. I want to refresh his memory for some questions that I wish to follow. Q. The original investment was about that amount, wasnt it? — A. Well, that, I say, I cannot say ; our books will show. 626 Q. About what did the plant cost?— A. I should say the plant cost seven or eight hundred thousand dollars. Q. And the balance of the investment was in what? — A. Stocks. At one time we had a large stock of crude oil on hand. Q. Now, the profits that the company had realized— the National Transit Company — were credited against this investment on the books from year to year, weren't they? Mr. EosBNTHAL. The books show that, I think, do they not ? Mr. ICellogg. Yes, they show that. Q. That is correct, isnt it?— A. You see, Mr. Kellogg, I am not familiar with that account. 32555—08 20 306 POLGBR. Q. Well, the profits that the National Transit Company do receive frona year to year A. Yes. Q. Wei'e credited against what the property cost, weren't they? — A. Yes, naturally. Q. Yes, naturally. So that on Decemher 31, 190-'», the plant stood them in a total cost of everything about $415,000, didn't it? — A. About that, or a little more, yes sir. Q. Now then, it was a big paying investment, wasn't it? — :V. Not very, no sir. Q. Well, you expect the plant to paj? for itself in a veiy few years, don't you? — .L. In less than ten years, yes sir. Q. And to pay the total amount out of the income; you expect that ? — A. We hojse so, yes sir. Q. And i^ay six per cent interest besides? — A. And pay six per cent interest, ,yes. 627 Q,. And that is a pretty good investment, isn't it ? — A. Well, we thought so. Q. Now, can you give any reason why the Standard Oil Com- pany or the National Transit Company would sell a business, which originally cost, the property alone, $700,000 or $800,000, for $415,000, to you, which would pay six per cent on that, and pay all the principal in a few years? Mr. MiLBT'RN. We couldn't get anybody else to buy it at that fig- ure but these ihen. A. Wh}', no reason except what they gave us, that they were anxious to dispose of it. Q. Now, did they try to get anybody else to make that deal with them? — A. Oh yes. We tried. Q. Whom did j'ou offer it to at that figaire? — A. Well, we offered it to no one at any definite figure. Q. Well, whom did you try to get to buy it? — A. My recollection is that we had some talk with Mr. Cullinan to see whether they wished to buy it. Q. What did you say to Mr. Cullinan? — A. That we would like to sell the Corsicana works. Q. Did you have that conversation? — A. Yes, I think that Mr. Payne and I had it with him. Q. What did he say? — A. He said they didn't wish it. Q. They didn't wish to buy it? — A. No sir. Q. Did you name this figure that you got it at?— A. No. G28 Q. Did you offer to sell il to them without the payment of any cash and have it paid for out of profits? — A. No. Q. You didn't offer them the deal that you got? — A. No. Q. What figure did you ask them? — A. We named no figure. Q. He said they didn't want to buy it. Did you try to get anybody to buy it on the terms that 3fou bought it? — A. No. Q,. Is Mr. Cullinan the only man you talked with? — A. Yes. Q. So you didn't make very strenuous efforts to sell it upon the terms that you bought it? — A. AVe knew of no one else that would be inclined to buy it. OBOSSLAND. 307 Examined by Mr. Rosenthal : Q. Is a refinery easily marketable '? — A. It can not be marketed. Q. What? — A. A refinery cannot be marketed, as a rule. Q. Why not? — A. It has no value except to run. You can get practically nothing out of a refinery when you dismantle it. Q. As to whether or not a refinery can be sold at all depends alto- gether upon its connections, does it not ? — A. It does indeed. Q. Upon its ability to get its crude oil ? — A. Yes. Q. Primarily? — A. Primarily. Q. And, secondly, upon its ability to market its products? — A. Yes sir. Q. So that it is, perhaps, the most difficult kind of property there is to dispose of, on that account, isn't that true? — A. Every owner of a refinery will tell you that, yes sir. 629 Examined by Mr. Kellogg : Q. I was going to ask you if you have any arrangements about the prices at which you are to sell the oil to the Waters-Pierce or other Standard companies. — A. Arrangement with whom? Q. With the Standard people here. — A. No sir. Q. No arrangement whatever? — A. No sir. Q. This company has a pipe line, hasn't it?^A. You mean the Corsicana Refining Company? Q. Yes. — A. Yes. Q. How much of a pipe line system has it ? — A. A very small line, at Corsicana. Q. At Corsicana. — A. The production is right there at the re- finery. Q. Oh, it is. You own some producing wells ? — A. Yes sir. Q. Does it produce all the oil it uses or buys from others? — A. It buys and produces, both. A recess was here taken until 2 o'clock P. M. 630 Afternoon Session (^Yednesday) Sept. 25, '07. G. M. Crossland, called as a witness on behalf of Peti- tioner, lacing duly sworn, testified as follows: Direct examination by Mr. Kellogg : Q. Mr. Crossland give your full name and residence. — A. G. M. Crossland, Interstate Commerce Commission. Q. Are you in the employ of the Interstate Commerce Commis- sion? — A. Yes, sir. Q. Do you have charge of the tariffs ? — A. Yes, sir. Q. All tariffs filed are filed in your department ?— A. All freight and pipe lines. Q. All freight and pipe line tariffs? — A. Yes. Q. I show you Petitioner's Exhibit 39. Please state what that is. — A. That is a brief of the pipe line tariffs which I brought to New York with me. 308 OKOSSLAND. Q. Is that a schedule of all the pipe line tariffs filed with the In- terstate Commerce Commission now in force? — A. Yes, sir. Q. What does the first column show? — A. The name of the pipe line issuing the tariff. Q. And filing it. — A. Yes, sir. Q. What is the second column? — A. The connecting pipe lines. 631 Q. The connecting pipe lines named in the tariff? — A. Yes, sir. Q. What is the third column under the head of Tariff No. — I. C. C. ? — A. Interstate Commerce number. Q. The next column " From ? " — A. Point of origin. Q. That is the name of the town from which the tariff shows that oil will be piped? — A. Yes sir. Q. And " To " is A. The destination. Q. The destination named in the tariff. The next column " Rate per ban-el of 42 gallons? " — A. Is the rate per barrel. Q. What? — A. Rate per barrel named in the tariff. Q. It is in cents, is it, and fractions? — A. Yes, sir. Q. "Additional charges for gathering per barrel," in cents, where it appears in the tariff? — A. And the word " none " written where no charge appears. Q. That is, where " none " is written there are no collecting charges named? — A. Yes. Q. The other is the additional charge for gathering named in the tariff? — A. Yes, sir. Q. " Minimum number of barrels will accept for shipment," what does that column mean? — A. That means the minimum amount of oil that is accepted for shipment and named in the tariff. Q. " Date effective? " — A. That is the date effective of the tariffs. Q. Named in the tariff? — A. Yes, sir. 632 Q. Now, does this schedule show all tariffs filed by all pipe lines in the United States which are now in force? — A. All filed with the Interstate Commerce Commission. Q. I mean filed with the Interstate Commerce Commission. — A. Yes, sir. Mr. Kellogg. May we introduce the original tariff as an exhibit and substitute a copy? Mr. Rosenthal. Certainly. Mr. Kellogg. Because these are the only ones on file in the office of the Commission. Mr. Rosenthal. Well, we shouldn't want to take any chances of those filed copies being lost. Mr. Kellogg. Well, we don't naturally. Mr. MiLBtTRN. It might cost twenty-nine million more dollars if we lost one of those tariffs. Mr. Kellogg. Well I don't know of any other way now. Mr. Rosenthal. Yes, substitute a copy. CKOSSLAND. 309 Mr. Kellogg. I don't know whether these should be marked or not. Mr. Rosenthal. You should not mark those. We undoubtedly have some of those at our office, although I don't know. Mr. MiLBtrEN. Why don't you say in your record just so many tariffs, describing them. Mr. Rosenthal. Well, he doesn't contemplate offering them all. Mr. Mn^BTORN. I thought he did. Mr. KeUjOGG. Oh no, I don't think it is necessary; one of 633 each kind as to form. Mr. Rosenthal. Describe it by its I. C. C. number and then we will see if we can get a copy. Q. I show you a tariff marked Joint Tariff, I. C. C. No. 1, the Buckeye Pipe Line Company, filed August 27, 1906. Is that the original tariff of that company filed in your office? — A. Yes sir. Mr. Kellogg. I offer that in evidence. Petitioner's Exhibit No. 40. Q. I show you joint Tariff I. C. C. No. 25, the Buckeye Pipe Line Company, filed October 30, 1906; is that an original tariff filed in your office? — A. Yes sir. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 41. Q. I show you Joint Tariff I. C C. No. 36 of the Buckeye Pipe Line Company; is that an original tariff filed by that company? — A. Yes sir. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 42. Q. I show you Joint Tariff I. C. C. No. 4, filed November 3, 1906, Cumberland Pipe Line Company. Is that an original tariff? — A. Yes sir. Q. On file in your office ?— A. Yes sir. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 43. Q. I show you Joint Tariff, I. C. C. No. 26, filed March 8, 1907, by the Eureka Pipe Line Company ; is that an original tariff filed in your office? — A. Yes sir. 634 Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 44. Q. I show you Joint Tariff I. C. C. No. 1, Indiana Pipe Line Com- pany, filed August 27, 1906. Is that an original tariff on file in your office? — A. Yes sir. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 45. Q. I show you Joint Tariff, I. C. C. No. 5, filed by the Indiana Pipe Line Company, August 27, 1906. Is, that an original tariff on file in your office?— A. Yes sir. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 46. Q. I show you Joint Tariff I. C. C. No. 4, filed August 27, 1906, by the National Transit Company. Is that an original tariff in your office?— A. Yes sir. 310 CROSSLAND. ]\Ir. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 47. Q. I show you Joint Tariff, I. C. C. Xo. 9, filed March 15, 1907, by the National Transit Company. Is that an original tariff on file in your office? — A. It is. Mr. Kellogg. I offer the same in evidence. Marked Petitioner's Exhibit 48. Q. I show you Joint Tariff I. C. C. Xo. 21, filed March 15, 1907, Southwest Pennsylvania Pipe Lines. — A. That is an original copy. Q. That is the original tariff? — A. Yes sir. 635 Q. Filed in your office? — A. Yes sir. Mr. Kellogg. I offer the same in evidence. (To the wit- ness) Mr. Crossland, you can keep those (returning tariffs to the witness) . Marked Petitioner's Exhibit 49. It is agreed by counsel that, subject to correction, the Schedule Exhibit 39 may be considered in evidence in lieu of the original tar- iffs. That is all I wish to ask, Mr. Crossland. Cross-examination by Mr. Milbitrn : Q. Air. Crossland, I notice one of the columns in this condensed statement is headed, " Miinmum number barrels will accept for shipment."' — A. Yes sir. Q. I also notice from the regulations which are a part of the origi- nal tariffs as filed two reading as follows from the one which I have in my hand : '' Second. It will forward such crude petroleum, when there has been tendered to it by the shipper, individually, or by him and others, a quantity of the same kind and quality of crude petro- leum amounting in the aggregate to not less than 300,000 barrels, all of which shall be consigned for delivery to the same delivery point. Fourth. Orders for the shipment of any specified kind of such crude petroleum shall only become effecti\e when orders from the shipper in connection with orders from other shippers for the same kind and quality of petroleum shall amount in the aggregate to 300,000 636 barrels, or more, consigned to the same point of delivery, and subject to this requirement, orders for shipment shall become operative in the order in which they shall have been received." Is it not the requirements of those two regulations that are condensed under this head, " minimum number of barrels will accept for ship- ment? " — A. Yes sir. Q. And in connection with some tariff's it is 300,000 and in others 75,000?— A. And in others 20,000. Q. And there is one in evidence here 20,000. With the excep- tion of the number of liarrels, the regulations are substantially the same? — A. As I understand, yes sir. Q. The regulations attached to each tariff are substantially the same ? — A. Why, I should say so ; in a great many, any way. Mr. Kellogg. Let me take those tariffs I gave you. The witness returns the same to Mr. Kellogg. (No Cross-examination.) PAYNE. 311 637 Calvin N. Payne, called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct examination by Mr. Kellogg : Q. What is your full name and residence? — A. Calvin N. Payne. Do you want the middle name ? Q. No sir, that will do. — A. It is a good old name. My residence is 102 West End Avenue, New York, although I have a home at Titusville, at which my daughter is living. I call it home yet. I have only been in New York since November. Q. What companies connected with the Standard Oil are you an officer of? — A. Well, the National Transit Company is one. Q. Are you an officer in all the pipe line companies? — A. Well, I think not. I think not. Q. Well, you are Vice-President of the National Transit Com- pany? — A. Yes sir. Q. And of the Buckeye Pipe Line Company ? — A. Yes, sir. Q. And the Crescent Pipe Line Company ? — A. No, sir. Mr. MiLBUBN. No. Q. Maybe you have honors that you don't know of. — A. Jfaybe I have. I don't know, it wouldn't be any wonder. Q. Well, according to the schedule of officers presented here by the defendant you seem to be a vice-president of the Crescent Pipe Line Company. — A. Well, that may be very recently, the last meeting perhaps I was. 638 Q. Well, this is the officers, it says, elected here November 27, 1906, and this is of June 27, 1907.— A. It might be. It might be that I am vice-president of that company. Q. You are also vice-president of the Eureka Pipe Line Com- pany ? — A. Yes sir. Q. The Indiana Pipe Line Company? — A. Yes, sir. Q. The New York Transit Company? — A. Lately, yes sir. Q. You are president of the Cumberland Pipe Line Company? — A. Yes, sir. Q. And vice-president of the Northern Pipe Line Company? — A. Yes sir. Q. Are there any other pipe line companies connected with the Standard organization? There is a Southern Pipe Line Company, isn't there ?— A. What? Q. There is a Southern Pipe Line Company? — A. Yes sir. Q. You are not an officer of that? — A. I am. Q. Oh, are you ? — A. Yes. Q. Well, what others ? — A. I don't think of any other now. Q. You don't think of any other ?— A. No sir. Q. Are you an officer of the Southwest Pennsylvania Pipe Line ? — A. Yes sir, vice-president. Q. Well, are there any pipe line companies of the Standard organi- zation of which you are not an officer that you recollect of? — A. I think there are. 312 PAYNE. Q. What are they?— A. The Prairie Oil & Gas Company. The Prairie Oil & Gas Company. I don't know whether that is a 639 Standard Oil concern or not, but I am not an officer of it. Q. Do you think of any other? — A. The Ohio Oil Company. I think I am not an officer of that company. Q. You are not an officer of the Ohio? How long have you been connected with the Standard organization ? — A. What feature of the business are you speaking of? Q. Oh, any feature. — A. Since December 20, 1885. Q. You commenced in what capacity, and with what company? — A. I was employed to build up and make a market for the gas, nat- ural gas that they had discovered in their operations. Q. You were first connected with the gas companies? — A. Yes sir. Q. When did you first become connected with the pipe line com- panies?— A. Not officially until 1901. Oh, I should say 1891. Q. 1891? — A. 1891, although I Avas looking after the manager's interest.- vrhile he was abroad previous to that time. Q. Who was the manrager of the companies at that time? — A. The manager of the National Transit Company was Mr. W. T. Scheide. Q. 17as Mr. Daniel O'Day connected vnth them? — A. Yes sir, he was the vicepresident I think. Q. Even before 18;;i you say you were looking after the interests of the pipe line company? — A. From May 1889 I looked after Mr. Scheide's interest in the pipe line as well as my own interest in the gas. G-10 Q. Your connection with the pipe line business, then, com- menced in 1889? — A. Yes sir. Q. Do you remember the United Pipe Lines that preceded the National Transit ? — A. Well, I have some knowledge of it ; I had no connection with it except they handled my production. Q. Well, that became a branch afterwards of the National Transit Comjoany's pipe line system, did it, called the United division, or something^ — A. Yes, sir. United Division of the National Transit Company. Q. And preceding the National Transit Company it was " The United Pipe Lines" wasn't it? — A. There was such a company be- fore that, before I had anything to do with it. Q. Do you know of the American Transfer Company? — A. I knew of such a company, yes sir. Q. Did that become merged in some way into the United Pipe Lines? — A. I don't know. Q. You don't know as to that? — A. No, sir. Q. Now, in connection with the Pipe Line companies, say since 1898, what has been your in-anch of the business? — A. 1898 or 1899? Q. Well, 1899, say. A. What has been my connection with it? — A. Yes. A. General Manager. Q. So you hav(i a general knowledge of all the pipe line systems of the Standard organization except the Prairie Oil & Gas Company's lines? — A. A few of th^jn. PAYNE. 313 Q. Are you familiar with the Prairie Oil & Gas Company lines ? — A. Not very. 641 Q. You know generally where they are? — A. I know they are in Kansas and Indian Territory. Q. And reach from Kansas and Indian Territory substantially to Whiting, Indiana ? — A. Yes sir, I think so. Q. You are familiar with the location of the Ohio Oil Company's lines, generally, I mean? — A. Generally, yes sir. Q. Where are they situated? — A. Principally in Illinois I think; Illinois and Indiana. Q. They reach from the Illinois fields into Ohio, do they? — A. Yes. Q. I mean into Indiana? — A. Into Preble, I think their lines reach; I am not sure about that; not of my own knowledge, I don't know that. Q. Do you know of the Manhattan Oil Company? — A. I know there was such a concern. Q. Is yet, isnt there? — A. Ye^ sir. Q. Wliere are its pipe lines situated? — xV. They are scattered out through Indiana and Ohio, I believe. Q. In what is known js the North and South Lima Indiana Oil fields? — A. I believe they have some lines in both localities. Q. Both in Indiana and in Ohio ? — A. Yes sir. Q. Do you remember when the Manhattan Oil Company property was sold to an English Company about 1899 ? — A. No. 642 Q. You have no recollection of it? — A. No. Q. Did you know Mr. John H. Cuthbert? — A. Did I know him? Q. Yes. How many years did you know him? — A. Oh I don't know, four or five or six years. Q. What? — A. Four or five or six years. Q. Before his death you mean. He died in 1903, did he?— A. He died somewheres in New York; I cannot tell you what year he died. Q. You knew him in 1888 and 1889?— A. No, I don't know as I would. Oh, I think if he was alive then I did know him, yes. Q. Do you know what business he was engaged in at that time ? — A. The first I knew of him he was an auditor. Q. Of what company?— A, Some of the gas companies. Q. Some of the Standard Oil ga* companies ?— A. Yes sir. Q. That was prior to 1898?— A. OL, yes. Q. Beg pardon?— A. Oh, yes, prior to 1898. Q. During 1898, and 1899 and 1900, was he also an auditor?— A. No, I don't think so. He was succeeded by Mr. Hampton. Q. Wade Hampton?— A. Yes sir; not Wade Hampton, Eobert Hampton. Q. Was he in the employ of the Standard Oil gas companies in 1899 ?— A. I think not. Q. Or any of their companies? — A. I think not. Q. Was he in 1901, 1902 and 1903 ?— A. He had nothing to do with them then, I am sure. 314 PAYNE. Q. Had nothing to do with them ? Did you know F. P. T. 643 Cuthbert?— A. F. B. C. Cuthbert? Q. F. P. T. Cuthbert.— A. The son of the other man? Q. I don't know. — A. If that is a son of J. F. Cuthbert I know him. Q. President of the Manhattan Oil Company. — A. Oh, I don't know that he is president of the company, but I know the man. Q. You know the man. — A. Yes. Q. Was he formerly connected with any of the Standard organiza- tions? — A. Yes sir, he was an assistant auditor at one time. Q. An assistant auditor; about when? — A. Oh, I should say 1888 or 1889, somewhere along there. Q. Prior to 1899 was he in the employ of the Standard Oil Com- pany ? — A. I couldn't tell what j'^ear he left the company. Q. What company was he assistant auditor of? — A. He did most of its work for the gas company, Buffalo. Q. Did he also work for the Transit Company ? — A. I don't know whether he ever audited the Transfer Company or not; I couldn't say to that. Q. Wasn't he an auditor in connection with some of the Standard Oil properties down to abovit 1899 ? — A. I don't think he was in the employ of the company as late as that. He might have been ; I have no knowledge of that. Q. Did you know E. R. Curtis? — A. No sir, I don't know the man. 644 Q. Louis Piatt?— A. I don't know him. Q. Do you know the Ohio Oil Company is also the owner of producing wells ? — A. Oh, yes. Q. What?— A. Yes sir. Q. Is it?— A. Yes. Q. Did it buy the producing wells of the Manhattan Oil Com- pany about 1899 ? — A. I don't know that. Q. You don't know anything about it ? — A. I do not. Q. You say you are not an officer of the Ohio Oil Company? — A. No sir. Q. Never have been ? — A. I think not. I might have been at some time and resigned ; I don't know how long ago it was. It must have been a number of years ago, if it was, if I was connected with it. Q. You have no recollection of the Ohio company purchasing the producing wells of the Manhattan Oil Company ? — A. No sir, I don't know it if they did. Q. You are an officer of the Buckeye Pipe Line Company? — A. Yes sir. Q. Its lines are situated also in Ohio ? — A. Yes sir. Q. The lines of the Manhattan Oil Company are connected with the Buckeye, are they not? — A. I think at some points, where they deliver some oil to the Buckeye Pipe Company. Q. They deliver all their oil to the Buckeye Pipe, don't they? — A. I don't know whether they do or not; thej' deliver some. PAYNE. 315 Q. Where are they connected with the Buckeye? — A. Now I can- not tell you exactly the names of the places. 645 Q. How many places do you know ? — A. I think two. Q. Two ? — A. One or two places. Q. Well, name some of them. — A. I cannot give you the names of the places ; they are not in my mind. Q. Well, do you know of any company to which the Manhattan delivers oil by connection with a pipe line except the Buckeye? — A. I do not. Q. Do you know of any company that it delivers any oil to except those controlled by the Standard Oil Company? — A. I don't know whom they deliver oil to, except they do deliver some oil to the Buck- eye Pipe Line. Q. Well you have pretty immediate charge of the business of the Pipe Line, haven't you ? — A. Yes sir, I have had. Q. And the Buckeye is quite a large pipe line, isn't it ? — A. Yes sir. Q. And you would be pretty apt to know if you got all their oil or didn't get it? — A. I don't think I would know necessarily. Q. How can we find out? Mr. MiLBtiEN. Eh? Mr. Kellogg. How can we find out? Mr. MiLBUK^r. Goodness gracious. Now you can't ask me. Witness. Ask some one of the Manhattan Company. Q. What? — A. Ask some of the gentlemen you have named here. I don't know. Mr. Pratt Q. Do 3^ou keep account of the amount of oil you buy from the Manhattan? — A. We don't buy any oil. Q. You don't buy any oil? — A. No. 646 Q. Do you know Mr. P. S. Trainor? — A. I think he buys oil. Q. For the Standard? — A. I know he has oil bought and placed to his credit in the Pipe Line. Q. He is a Standard Oil man, isn't he ? — A. T think so. Q. Yes, buys oil for the Standard exclusively ? — A. I Don't know whether he buys for them exclusively or not. Q. Well he doesn't buy for anybody else except the Standard, does he?— A. Well, I think he has. Q. Does he now ? — A. I don't know whether he does now or not. Q. Well, does he buy the oil of the Manhattan Oil Company ? — A. I think he does just the same as he buys it from other people. Q. Pie buys all of the oil of the Manhattan Oil Company, doesn't he? — A. I clon't know. Q. "\YeIl you know that the Manhattan connects with the pipes of the Buckeye Pipe Line Company.— A. I know that they deliver oil into the Buckeye Pipe Line custody. They could not do that with- out delivering it lay pipe or tank. Q. Quite so. And they deliver it by pipe?— A. I think so. 316 PAYNE. Q. Well now, your records would show how much is delivered to the Buckeye, wouldn't they? — A. The Buckeye Pipe Line books would show just how much, to a fractional barrel. Q. Where are they kept ? Here in New York ? — A. No sir. Q. Where ? — ^A. The " run " books are kept in Ohio. Q. At what place in Ohio? — A. Lima, Ohio. Q. And those books would show the amount delivered by the 647 Manhattan to the Buckeye? — A. Yes, sir. Q. Each year ? — A. Each year, each day ; each run that they make. Q. Now when did the Manhattan Oil Company commence to de- liver oil to the Buckeye Pipe Line? — A. I can't tell you; you will have to go to the books for that. Q. Well, what is your recollection of it? — A. I have no recollec- tion, at all, Mr. Kellogg, about it. Q. Well, comparatively, the Manhattan is a large company, isn't it? — A. Yes, sir. Q. And it would pipe a very large amount of oil, wouldn't it? — A. It hasnt piped much oil for a good many years. Q. How long since it ceased to be a very large company ? — A. Well, 1 should say four or five years. Q. For the last four or five years, it has not been a very large concern ? — A. It has been piping more oil than it did — well, I should say they are piping more oil now than they did three or four years ago. Q. How about seven or eight or nine years ago? — A. Oh, I dont know ; that is too far for my memory. Q. Too far for your memory? — A. Yes. Q. Well, its business has very largely decreased since it connected with the Buckeye, hasnt it? — A. Not in proportion to the Buckeye's decrease. Q. Well, I mean has its business largely decreased since its con- nection with the Buckeye ? — A. So has the Buckeye. Q. What is that ? — A. They both have decreased together. 648 Q. Well, the Manhattan's has, hasnt it?— A. Yes. Q. Are its lines connected with any other of the Standard's pipe lines? — A. I think not. Q. None but the Buckeye ? — A. Noiae but the Buckeye. Q. Well, were those lines connected prior to October and Novem- ber, 1899?— A. I couldn't say. Q. You have no knoAvledge on that subject? — A. No. Q. Who would know about that ? — A. The books would show when they were connected. Q. The books will show? — A. Yes, the books will show when we received any oil from them. Q. You are the general manager, are you? — A. Yes, sir, I have been. Q. And vice-president ? — A. I am not general manager now ; I am vice-president. PAYNE. 317 Q. Oh, you are vice-president. Will you make a statement show- ing the time the Manhattan Oil Company's lines were connected with the Buckeye Pipe Lines of the Standard Oil Company or any other Standard Oil Company, and showing the quantity delivered to the Buckeye each year since and including 1900? — A. Since and includ- ing 1900? Q. Yes. Mr. Chase will write that off for you and give it to you. Mr. MiLBUEN. That will be written off; you neednt make a memo- randum of it. Witness. All right. 649 Q. Mr. Payne, you are a partner of Mr. Folger's in the Cor- sicana Refining Company, are you ? — A. Yes, sir. Q. Did you hear Mr. Folger's testimony this morning? — A. Part of it. Q. About 1898 or 1899 that firm of Corsicana Refining Company was organized I believe? — A. No, not in 1898, the Corsicana Refin- ing Company wasnt organized. Q. Well, the original partnership. The original partnership was J. S. CuUinan & Co., in 1898?— A. Yes. Q. Then that was dissolved and succeeded by the Corsicana Refin- ing Company? — A. In about two years that was dissolved, by Mr. CuUinan leaving, withdrawing, according to the agreement we made in the first place. Q. Now I am not going all through the details of that. With whom did you make the arrangements for the National Transit to furnish the money to construct that plant?— A. Mr. O'Day, the vice- president. Q. What reason did Mr. O'Day give for you and Mr. Folger's hav- ing the plant in your name ?— A. Well he had some doubt about the legality of the National Transit Company doing business there. Q. Well, the Standard Oil's refineries are not usually owned by individuals, are they?— A. I dont know. Q. You are not familiar with the organization of the refineries?— A. No, sir. 650 Q. Well, its pipe lines are not, are they ? Its pipe lines are owned by companies, and the Standard Oil owns the stock?— A. Yes, I think so ; owned by corporations. Q. Yes, by corporations. That was the only reason he gave?— A. That was the only reason he gave. Q. Now, the National Transit Company had no business in Texas, had it ? — A. I dont know. Q. At that time?— A. I dont know whether they had or not. Q. You were the general manager, werent you ?— A. Yes, sir. Q. Do you know of any business it had in Texas?— A. That it did have? Q. Yes.— A. It didnt have any. Q. At that time?— A. No. Q. It had no pipe lines in Texas?— A. No, sir. 318 PiiYNE. Q. It had no business anywhere nearer than Western Pennsylvania, or Ohio ? — A. I think not ; Western Pennsylvania, I think. Q. Was there any reason gi-\en why the National Transit Company should advance the money to construct a refinei'y in Texas ? — A. Yes sir, there was. Q. What was it? — A. Mr. CuUinan had spent, I tliink, the winter in Texas, and he had discovered that in drilling an artesian well in the town of C'orsicana tliey had stnick oil in one of the wells. When he came north he came to see me, and we had an interview with Mr. O'Day in reference to this oil development. He wanted that that oil should be tal^en care of, and he would like to have a liand in it. He was very much impressed with Texas, as he told us, and he 651 thought this was going to be an oil field and the oil ought to be taken care of and a market made for it. Mr. O'Day de- murred very much about having anything to do with it, and I dont thinli at the first interview there was anything done at all, but later they decided to put up an iron tank or two and see what the field amounted to. The first development was on little town lots in the negro quarter. But as the wells were shallow the development came along pretty fast, and so O'Day said if we wanted to organize this partnership that the National Transit Company would finance it. And we entered into a contract, which I think Mr. Folger delivered to you, protecting ourselves in case of anything happening to any of us, and also protecting the National Transit Companj'. Q. No, there was no such contract sliown to me. — A. I think there was. Q. No, tliat was a mere contract of partnership, — A. Well, that was the agreement that we were to be protected in case of death and the National Transit Company in case of- Q. The National Transit was to furnish the money, own the property A. They were to furnish the property (money) and the property was to be talven in our name. Q. In your name ? — A . Yes ; that is, in the name of J. S. CuUinan & Company. Q. And afterwards the Corsicana Refining Company was 652 organized as a partnership, with you and Mr. Folger. Now, wouldn't it liave been moie natural for the Standard Oil Com- pany to have organized its own company, to build a refinery in Texas? — A. I dont know that it would. Q. Did you talk witli anybody else excepting Mr. O'Day? — A. I dont think so at tliat time. Mr. O'Day was the medium through which I recei\'ed all my instructions. Q. Mr. Archbold or Mr. Rogers?— A. I think I talked to Mr. Rogers later about it, but not at that time. Q. Well, was this plan approved by him? — A. I think so. Q. Did you talk with any other of the Standard Oil men? — A. No sir. Q. Mr. Rockefeller?— A. No sir. Q. Mr. William Rockefeller ?— A. No sir. PAYNE. 319 Q. No other reason was given you than that? — A. No sir. Q. Well, now, in June, 1906, Islr. Folger says the property was pur- chased from the National Transit, by you and by him? — A. Yes sir. Q. Were you present at that time? — A. Not in June, not at the time; not at June 15th. I was present earlier in June. Q. With whom did you ha-\e your conversation about that? — A. With Mr. O'Day. Q. With whom?— A. With Mr. Daniel O'Day. Q. Did you also have a conversation with Mr. Archbold? — A. No sir. 653 Q. You only had conversation with Mr. Daniel 'O'Day? — A. Mr. O'Day. I had several conversations with Mr. O'Day. The first one was in January. Q. What reason was given for your purchasing the property at that time? — A. They wanted to sell it badly. Q. Did you try to sell it to anybody else? — A. Did we? Q. Yes. — A. Yes, we had tried to sell it to other people. Q. To whom? — A. I talked to Mr. Cullinan, myself, about him taking it. Q. Did you name a price for him? — A. No, I asked him to name a price that he would give for it. Q. What did he say? — A. He said he didnt think it would interest him because they had a large refinery now. Q. When was this ? — A. This was about a year ago, I thinlt. Let's see. No, it wasnt a year ago. It was later than that. I was absent in Europe Mr. Rosenthal. You say later than that. Do you mean by that more or less than a year? Witness. Why, later period; not an earlier period. Q. Well, less than a year ago? — A. Yes sir, less than a year ago, No, not less than a year ago. Q. You are mistaken, I guess. — A. I am speaking of January, 1906. Q. Yes, I understand. Before you purchased it, you had this conversation? — A. Before we purchased it, yes. Q. That is something less than a year before January, 654 1908?— A. Before January? Q. Yes, you bought it in June as of January 1, 1906?— A. Yes. Q. Now, was it in January, 1906, you offered to sell it to Mr. Cullinan?— A. No, I am talking about the interview with Mr. O'Day in January, 1906. « Q. When did you offer to sell it to Mr. Cullinan, or whatever his name is? — A. After I came back from Europe, October 14, Mr. Folger and I had an interview with Mr. Cullinan and a representa- tive of Mr. Gates of the Texas Company. Q. And that was in October, 1905 ?— A. Oh, no ; 1906. Q. 1906, after you had bought it?— A. After we had bought it. 320 PAYNE. I Q. Now, did you offer it to him for the same price you paid for it? — A. Oh, no, we didn't offer it to him at any price. We asked him what he would give for it. Q. What reason was given for your purchasing it at that time ? — A. They wanted to get rid of it, and they thought we might make some money out of it. Q. Why did they wish to get rid of it? — A. They didnt want the National Transit Company to be in Texas. Q. Or any other Standard Oil Company ? — A. I don't know what they wanted. They didnt saj' anything about any other company. Q. The Corsicana Refining Company had been understood in Texas and eveiyvihere not to belong to the Standard, hadn't it? — A, No sir. Q. Had it been advertised in Texas A. Pretty nearly every- body understood it was the National Transit Company. 655 Q. Pretty nearly everybody understood it? — A. I think so. Q. Well, when did they understand that ? — A. I dont know ; everybody I ever talked with. We never claimed that it was ours. Q. Dicl you advertise in Texas that the National Transit Company owned the Corsicana Refining Company ? — A. Did we advertise ? Q. Yes.— A. No. Q. Do you know of anybody that knew it? — A. Oh, I think a great many people knew it. Q. Well, who are they? — A. I dont know as I can give you the names of the people. Q. Anybody outside of the Standard organization know it? — A. Outside of the Standard ? Q. Yes. — A. Oh, I think so. Q. '^^Tio ?— A. I think Mr. CuUinan knew it. Q. Oh, you think Mr. CuUinan knew it ? — A. Yes. Q. Anybody else? — A. Oh, yes; I think a number of people knew it. Q. Now, as a matter of fact, Mr. Payne, it was generally known and claimed by the Standard people that they did not own the Corsicana Refining Company, wasn't it? — A. I dont know what they claimed, Mr. Kellogg. I dont know what the Standard Oil Company claimed, but there never was a statement made that the National Transit Com- pany didn't own the Corsicana Company. Q. Dont you know that in the answer in this case it is denied that it belonged to the Standard or any of the sub-companies of the Standard. 656 Mr. MiLBTJEN. It is not. I beg your pardon. A. I dont know anything aboutethe answer that was made. Mr. MiLBUEN. You allege it was owned by the Standard Oil Com- pany of New Jersey and that was denied. It is not owned by the Standard Oil Company of New Jersey, and never was. Mr. Kellogg. Well, the Standard owns the National Transit. Mr. MiLBUBN. Well, that is another thing. Mr. Kellogg. Your allegation is broader than that. PAYNE. 321 Mr. MiLBtJEN. Oh, no. Q. Isnt it a fact that for years the Corsicana Refining Company has been doing business in Texas as an independent concern, not con- nected with the Standard Oil Company. — A. No sir. Q. Is it not a fact ? — A. No sir, it is not a fact. Q. It isn't? — A. No. We were selling most of our products, or, at least half of the products to the Standard Oil Company people. We were dealing with them. I am speaking of the Standard Oil Company of Indiana. Q. Well, is it not a fact that they denied owning the Waters-Pierce Company ? — A. I- dont know whether they did or not. Q. Isnt it a fact that the Waters-Pierce was claimed not to be a Standard concern ? — A. I dont know what they claimed. Q. And you sold most of your product to the Waters- Pierce, didnt you? — A. We sold a good deal; most of the product; that is, the refined and the naphtha that Mr. Folger testified to. 657 Q. What price did you pay for this property? — A. The jmr- chase of 1906 by Mr. Folger and me? Q. Yes.— A. $992,000 was what I paid for it, about that. Q. Well, as a matter of fact, the company had five or six hundred thousand dollars cash in the treasury, didn't it ? — A; Yes sir. Q. So you paid a little over four hundred? — A. About four hun- dred thousand dollars. Q. The plant had cost over $900,000, hadnt it?— A. I dont think so. Q. Do vou know what it had cost? — A. I dont think it cost over $600,000. ' Q. Mr. Folger thought over seven or eight. — A. Well, T dont think it cost o^-e^ six or seven hundred thousand dollars originally. Q. You paid no cash for it, did you ? — A. No sij-. Q. Gave no obligations? — A. No sir. Q. No contracts? — A. No contracts. Q. Simply a verbal understanding? — A. Simply an agi'eement. Q. And the National Transit Company has taken all their earn- ings up to the present time and applied it on the purchased plant ? — ■ A. I understand it has gone into the same account, to our credit. Q. The business has been managed in the same way? — A. Practi- cally so. Q. There has ben no change in the accounting and the state- fl.58 ments furnished to 26 Broadway ? — A. I think there lias been a little more energy put into it. Q. A little more energy ? — A. I think so. Q. That is all you can think of in the change ?— A. Well, we have gone to Henrietta, in the Northern part of Texas, and got some pro- duction there, and we are shipping oil from there ; get a supply. Q. But so far as the management of the business and the report of its earnings and the payment of its earnings over to tlie National Transit, everything has been done in the same manner since as be- fore? — A. It was organized about as good as it could be. 32555—08 ^21 322 PAYNE. Q. And all the change there has been has been the verbal under- standing between you and Mr. O'Day? — A. Yes tiir. Q. And Mr. Archbold ? — A. Mr. Folger ai.ade the contract. I want to explain Q. Made by Mr. Folger? — A. I want to explain, Mr. Kellogg. Q. ^Yait a moment. That they sold the property to you?— A. Yes sir. Q. To be paid for out of the earnings? — A. Yes sir; and in ten years we were to make good. Q. If it didnt pay for it out of the earnings in ten j'ears, you were to make good? — A. Yes sir. Q. What is it you wanted to explain, Mr. Payne? — A. My 659 health broke down in the Fall of 1905. The early part of 1906, six weeks I was at Hot Springs, Arkansas; came back in April ; had an interview with Mr. O'Day in May, I think the early part of May, and he urged that Mr. Folger and myself buy this prop- erty. I left this countr}', on account of my health, on the 4th of Jaly. Mr. Folger told me that he had concluded the trade, ajid wanted to know if I acquiesced in it, and I said, " Yes ; if you think it is worth the money I will stay with you." I went to Europe and vras gone three months and a half. So that I knew little about what went on during that time. Q. To whom was this property conveyed down there, originally — to you or to the firm, or to you individually ? — A. The property ? Q. Yes. — A. It was conveyed to the Corsicana Refining Company. Q. Now, Mr. Payne, I suppose the books of the National Transit Company show the financial arrangement from the time of the con- struction of the plant, and the earnings, the condition of the account between the National Transit Company, down to the present time, do they not? — A. I dont think they will show. I dont know, but I dont think they will show the detail expenditure of building the plant. Q. No, but they will show the financial operation? — A. They will show the amount of money that was drawn and put into the plant. Q. They show the investment in the plant? — A. Yes sir. Q. And the credits against that plant? — A. No, that wouldn't show the investment in the plant. They would show the amount of money that was drawn either in the purchase of oil, which 660 began as soon as the first tank was erected; they would show the money that was drawn to pay for the tank and the oil and the works. Q. By plant I meant — I should explain myself — ^the entire invest- ment? — A. The Corsicana books will show exactly what the invest- ment was. Q. But the books of the Transit Company will show the total amount it had invested each year? — A. The total amount of money, yes. Q. And it will show the profits it has received each year? — ^A. It will show the amount of money returned from the plant. PAYNE. 323 Q. And does the Corsicana Refining Company send to the National Transit Company a balance sheet similar to these other balance sheets? — A. It sends it to Mr. Folger. Q. To Mr. Folger?— A. Yes sir. Q. Did it furnish it to the National Transit Company? — A. I dont know whether it furnished any statement to the National Transit Company, or not. They furnished me a statement. Q. What is that ? — A. They furnish me a statement monthly. Q. They furpish you a monthly statement? — A. Yes. Q. Well, did the National Transit Company obtain a balance sheet showing the financial conditions, the principal items of property sim- ilar to other concerns which the National Transit Company owned ? — A. I don't know. Mr. MiLBUEN. He doesn't know. 661 Q. You dont know as to that. Well, your other pipe line companies and other companies owned by the National Transit Company furnish a balance sheet each year as of December 31st, showing the principal items of assets, condensed, and liabilities, net earnings, and such items as that, do they not? — A. Yes, there is a balance sheet shown ever}^ year. Q. Now, did the Corsicana Refining Company furnish such a state- ment to the National Transit? — A. Not to the National Transit, no. Q. It didn't? — A. It furnished it to me. Q. Did you turn it over to the National Transit? — A. They saw it ; the National Transit saw it. Q. The National Transit got the items for its books from that statement, did it? — A. No, they got the items from the money they were drawn for ; the money they deposited to the credit of Q. Well, have you got those statements? — A. I have got some of them, I think. I dont think I have got those that were in my office at Oil City. Q. Well, will you procure those statements from 1898 down to the present time ? — A. The statements that were made to me ? Q. Yes sir, the balance sheets each year. — A. I can give what I have got of them. Q. All right. — A. I dont know how many I have of them. Q. Who is the comptroller of the National Transit? — A. The pres- ent comptroller? 662 Q. Yes. — A. George Chesebro. Q. He would have whatever balance sheets or statements the Corsicana Refining Company furnished? — A. I think he ought to know ; I am not sure. Q. Now, you said Mr. Folger received statements from the Refin- ery? — A. I think so. Q. Those statements were statements of the operations of the re- finery itself? — ^A. I think they embraced all the work. Q. Well, he is a refining expert, isn't he? — A. He ought to know something aboilt refining ; he has been at it a good many years. 824 PAYNE. Q. And he receives from all the Standard organizations, he said, statements showing the details of operation of the refineries? — A. Yes. Q. Did he receive such from the Corsicana? — A. Oh, undoubtedly, he did. Q. Now, in a general way, I would like to have you describe the pipe line systems of the Standard organization. Where does the pipe line of the Prairie Oil and Gras run? — A. Well, I told you only in a general way I knew about the Prairie Oil and Gas Company. Q. From the Kansas and Indian Territory fields to Kansas City and to Whiting, Indiana, does it not ? — A. I think they have a line to Whiting, Indiana ; one or two or more lines, I don't know how many. Q. Where is the next, at Griffith, Indiana? — A. I think 663 that is the terminal point. That is the terminal point of the Indiana Pipe Line Company, anyway. That is the connecting point with the Prairie Oil and Gas Company. Q. Where do the pipe lines of the Standard of Indiana run? — A. Eun to Whiting. Q. Run to Whiting?— A. Yes. Q. Connecting with the Prairie Oil and Gas at Griffith? — A. I think the Prairie Oil and Gas Connect at Griffith, yes. Q. That is a little place near Whiting? — A. Yes. Q. A few miles south ? — A. No place at all ; it is an open country. Q. Sort of a junction? — A. Sort of a junction, yes; an open coun- try. Q. Through what States does the Indiana pipe line run? — A. Through the State of Indiana. Q. Through Indiana? — A. Yes. Q. Did the Indiana Pipe Line Company — I didn't ask you if the Standard Oil Company of Indiana owned pipe lines. The Indiana Pipe Line Company is the one that owns the pipe lines, isn't it? — A. Yes sir. Q. That is as I understood. — A. The Indiana Pipe Line Company. Mr. MiLBURN. He told you that. Witness. The Indiana Pipe Line Company owns it. Q. That may be understood, if I made a mistake. Where is 664 the terminus? — A. The eastern terminus of the Indiana Pipe Line Company's line, at the eastern line of the State of Indiana. Q. Does it own any line in Ohio ? — A. No sir. Q. Did it ever own any line in Ohio ? — A. Never, not to my knowl- edge. Q. You have known it since its organization ? — A. Yes sir. Q. Where it connects with what line at the eastern line of In- diana ? — A. With the Buckeye Pipe Line Company. Q. Is there any pumping station there ? — A. Is there any ? Q. Yes, on the State line. — A. Very close to it, yes, I think so. PAYNE. 325 Q. Well, is there any break right on the line of the pipe, or is it a continuous pipe?— A. I don't know; I never walked over the State line ; I dont know exactly where it is. Q. Well, it is a continuous pipe line isnt it ? — A. Well, no. Q. Across the State line?— A. It isnt all the same sized pipe. There are different sized pipes. Q. Is the different size on each side of the pipe line ? — A. Some of them are, yes sir. Q. Do you know whether there is at the line between Indiana and Ohio?^A. Between Indiana and Ohio? Q. Yes. — A. I dont know whether there is a station very close to the line there or not ; I think there is. 665 Q. Well, there is no break at that point; it is used for pumping oil straight through ? — A. Oh, yes sir. Q. For a continuous shipment of oil? — A. Yes sir. Q. We are speaking now — or you are — of the main lines? The Indiana Pipe Line also have gathering lines, ha vent they? — A. Yes sir, local divisions. Q. And they connect with the main lines at various places? — A. Yes sir, principally at Montpelier. Q. Principally at Montpelier, Indiana? — A. Yes. Q. And the gathering lines have a station or connection at Mont- pelier? — A. Yes. Q. Any other connections in Indiana? — A. Oh yes, they have a connection at Preble? Q. At what? — A. At a station called Preble. I am speaking of the local division now, has a connection at Preble. Q. Have you, Mr. Payne, a map which will show generally the location of all your pipe lines? I dont mean the small gathering lines, but the main pipe lines. — A. I havent them in my possession, no sir. Q. Have the companies that you know of? — A. The companies have, I think. Q. They made a general map of the whole thing? — A. They made a map for each line I think for the Interstate Commerce Commission. Q. For the Interstate Commerce Commission? — A. Yes; I dont know Avhether they took any copies of it or not. 666 Q. I wondered whether you had a map we could use for convenience for the purpose of showing the location of each of the systems or all of the systems together? I mean the main lines, not all the gathering lines. — A. I havent any map now. Q. You made one for the Interstate Commerce Commission? — A. The engineering department did make one. Mr. MiLBTJEN. What department? Witness. The engineers, I believe. Q. Well, the engineering department of the National Transit Com- pany have them all, or of each separate company ? — A. No, the engi- neering department made it for each separate company. 326 PAYNE. Q. Where is the engineering company — here? — A. Some at Oil City and some of it at New York, and some of it in Lima. Each locality has its own engineering map. Q. I notice, Mr. Payne, that the only stations from which the Indiana Pipe Line Company publishes a tariff that it will transport oil are Griffith, Indiana, and Preble, Indiana. Q. Preble, yes. Q. Preble, Indiana? — A. Yes. Q. Those are the only ones, are they ? — A. I suppose so, if that is all the tariffs that are filed. Q. Preble is a connection with gathering lines, and Griffith is the connection with the Prairie Oil and Gas line at Griffith ? — A. Yes. Mr. MiLBUEN. Those are the only stations it has. 667 Q. Now, where is the line of the Buckeye Pipe Line Com- pany? — A. In the State of Ohio. Q. Entirely in the State of Ohio ? — A. Yes sir. Q. Did it ever own any lines in any other State? — A. No sir. Q. Never? — A. Not to my knowledge. Q. Its Western connection with the Indiana Pipe Line is near the Indiana State line ? — A. Yes sir. Q. Where does it connect on the East? — A. At several points. They have lines connecting at several points in the East. Q. Where ? — A. Cook's Ferry is one place. Q. Cook's Ferry, what line does that connect with ? — A. That con- nects with the Pennsylvania State line. Q. That connects with the southwest Pennsylvania pipe line? — A. Yes. Q. Where else does it connect? — A. It connects with the National Transit Company at Mantua. Q. Where is that ? — A. That is on the State line between Ohio and Pennsylvania. Q. Is it exactly on the State line? — A. Yes, I think so. Q. You think it is ? — A. Yes ; very close anyway. Mr. MiLBUEN. What is that — ^Mantua ? Mr. Kellogg. Mantua, yes. Mr. MiLBTJRN. You say the State line? Witness. Near the State line. Q. Isnt Mantua that you speak of a long ways from the 668 State line?— A. Mantua? Q. Yes. — A. Well, I think the Buckeye Pipe Line Company owns the line to the State line and the station on the Ohio side. Mr. MiLBUEN. Mantua, as I understand, is about thirty miles in Ohio. Witness. Mantua is in Ohio, isn't it ? Mr. MiLBUEN. Yes. Witness. The Buckeye Pipe Line owns the station in Ohio, all the stations in Ohio. Q. Mantua is between the State line and Cleveland, isnt it? — ^A. Yes sir. PAYNE. 327 Q. Thirty or forty miles in Ohio? — A. From where? Q. From the Pennsylvania state line. — A. Oh, I dont think so. Q. Well, here is a map, I dont know whether it is correct or not. You can state (showing witness map in the bill of complaint) here is Cleveland right there. — A. Well, the Buckeye Pipe Line Company owns to the State line. Q. I will ask you to explain that? Well, Mantua is quite a ways over in Ohio, isnt it? — A. Yes sir; I said that the Buckeye Pipe Line owned the Mantua station. Q. Now, between Mantua station and the Pennsylvania state line, what company owns the pipe line ? — A. The Buckeye Pipe Line. Q. How long has it owned it? — A. Always. Q. Always owned it? — A. I think so. Wefl, I dont know about that. Q. Wasnt that change made in about 1905 ? — A. No, I dont 669 think so. The National Transit Company did own one line to Cleveland. Q. The National Transit? — A. Yes sir. and they disposed of that part of it I think in Ohio, but I dont know when. Q. Now these changes were made about the time of the passage of the Interstate Commerce law applying to pipe line companies, were they not? — A. I dont think so. T dont know, though. I dont know. Q. You dont know as to that ? — A. No, I dont know. Q. Do your books show that ? — A. When the Interstate Commerce law was passed, the Hepburn Bill? Q. Yes. — A. I was in Europe, and I knew nothing about what was done between the fourth day of July and the fourteenth day of Oc- tober, 1906. Q. Very well. You know whether tlie National Transit Company owned the line in Ohio, either before or after the pas^^age of that bill, dont you? — A. No, I dont know. Q. You dont know ? — A. No. Q. Well it used to own a part of the line in Ohio ;' — A. I will tell you why I dont know : because I havent had the trunk line feature so much in my charge as the gathering system. Q. Well, who does have that more in mind? — A. Mr. Towl did have. Mr. J. H. Snow Q. Well is Mr. Towl here?— A. I dont know. Q. Is he employed by you ? — A. No sir. Q. Employed by the Transit Company ?— A. Yes sir. 670 Q. He has been?— A. Yes. Q. Is he now? — A. I dont know whether he is now or not. Q. How long since you have seen him? Mr. Towl was tax com- missioner, wasnt he ? — A. No sir. Q. What was he— an engineer ?— A. An engineer. Q. In the employ of the National Transit Company ^— A. Has been in the employ of the National Transit Company. Q. Up to what time?— A. I dont know when he resigned. Q. He resigned ?— A. I think so. 328 PAYNE. Q. How long ago? — A. I dont know how long ago. Q. Havent any idea whether it was one year or ten ? — A. Oh yes. Q. Well, that is what I want to get at. — A. Less than ten years. I dont think Jim Snow was manager ten years ago. Q. How long ago did Mr. Towl resign? — A. I dont know. Q. A great many months or weeks? — A. A few months ago, I should say. Q. "Wliere is he now? — A. I dont know. Q. Did you know him well? — A. Yes sir. Q. See him often when he was in the A. I have seen him quite frequently. Q. Lately?— A. Yes. Q. Well, where? — A. Saw him in his office. Q. 26 Broadway?— A. Yes. Q. Well, I would like to see him. Now, Mr. Payne, you dont know, then, when the Buckeye Pipe Line did get the line between Mantua and the Pennsylvania state line? — A. No sir. 671 Q. Wliether that was in 1906 or not ? — A. I dont know. Q. And you dont know when it got the part of the National Transit's line which was in the State of Ohio? — A. I think that the line between Mantua was transferred at the time the Buckeye Pipe Line was built — that part of it. Q. How about the National Transit's line? — A. I am speaking of the National Transit. Q. Oh, that is the one? — A. Yes sir. Q. Well, the Ohio Oil Company's line extends from Illinois over into Ohio, does it? — A. Yes sir. Q. And cojinects with the Buckeye at what place? — A. Connected with the Buckeye Pipe Line Company ? Q. Yes. — A. At the State line, I think. Q. At the State line of Ohio and Indiana ? — A. No, at Adgate. Q. At what?— A. At Adgate. Q. That is over in Ohio? — A. Yes; at Adgate Station. Q. That is one line that crosses a State line, isn't it? — A. Yes. Q. Now what other connection on the east has the Buckeye Pipe Line Company got? — A. I think I have named the only two. Q. Well, the pipes are used in connection with the lines in Pennsyl- vania for through transportation of oil, are they not? — A. Yes sir. Q. Have you named the only pipe lines you have in Ohio? — A. Yes sir. Q. What ])ipe lines have you in Pennsylvania ? — A. We have 672 the National Transit Company, and the Southwest Pennsyl- vania Pipe line; the Northern Pipe Line and the Southern Pipe Line. I think that is all. Q. Do they extend down into West Virginia and Kentucky and Tennessee? — A. No, sir. Q. T\Tiat are the lines that extent southwest into Tennessee, Ken- tucky and West Virginia? — A. The Cumberland Pipe Line is in Kentucky. PAYNE. 329 Q. The Cumberland in Kentucky? — A. Yes sir. Q. What one is in Tennessee ? — A. None. Q. Doesnt the line extend over the line into Tennessee? — A. No sir. Q. It does not. The Cumberland extends from Mr. MiLBTJEN. This shows some line here over a very short dis- tance. Witness. That production went all to pieces, and there was noth- ing left of it, and that line was taken up in Tennessee. Q. Oh, it was. It used to be in Tennessee ? — A. Yes. Q. The Cumberland Pipe Line extends, then, through Kentucky and West Virginia? — A. No. Q. Just through Kentucky? — A. Just through Kentucky. Q. Wliere does it connect with the other lines? — A. At a little place near Warfield, on the boundary line between Kentucky and West Virginia. Q. Well, is it right on the line? — A. Yes sir. Q. Then, what line is it in West Virginia ? — A. The Eureka 673 Pipe Line. Q. How long has that line been divided on the State line ? — A. The Eureka ? Q. Yes, between the Eureka and the Cumberland? — A. Always. Q. The Eureka owns the line in West Virginia, does it? — A. Yes sir. Q. And it connects where, and with what company ? — A. Connects where and with what company? Q. Yes. — A. ^YhJ■, it connects with the Pennsylvania State line. Q. With what comapny's lines? — A. With the Southern Pipe Line Company and with the Southwest Pennsylvania Pipe Line. Q. With both of them?— A. Yes sir. Mr. MiLBURN. At different places? Witness. At two different places, yes sir. Well, more than two different places. Q. Did the Eureka ever own any line in Pennsylvania? — A. The Eureka ? Q. Yes. — A. I think not ; not to my knowledge. Q. You have named the lines in Pennsylvania. What company owns the line in New York? — A. New York State? Q. Yes. — ^A. New York Transit Company. 674 Q. Where does it connect with the Pennsylvania lines? — A. Near Olean, New York, on the state line. Q. Did it always connect at that place? — A. The New York Transit Company? Q. Yes.— A. No. Q. Where did it used to connect?— A. At Olean? Q. At Olean?— A. Yes. Q. When was that change made? — A. Oh, I dont know; several years ago. Q. How many years ago ?— A. I dont know exactly. 330 PAYNE. Q. Right after the passage of the interstate commerce act? — A. I dont know. Q. I mean the Hepburn bill. — A. I dont know when it was made. Q. 1906 ? — A. I couldnt say ; I couldnt tell you. Q. Well, who can tell us exactly when that was done? — A. The books ought to show. Q. The books of the New York Transit Company? — A. I think Mr. Chesebro can tell, — the comptroller. Mr. Kellogg. All right ; we will ask Mr. Chesebro. 675 Q. Where does the New York Transit Company Line run from? — A. The New York Transit Company? Q. Yes. — A. It runs from the State line of Pennsylvania, where it joins the New York State Line to Q. To Buffalo?— A. To Buffalo. They have one line to Buffalo, and they have one line to Unionville, I think; three lines to Union- ville, lying alongside of each other. Q. Where is Unionville? — A. On the State line, I think, between New Jersey and Pennsylvania. Q. When was the line divided, on that line ? — A. I dont know. Q. You dont know anything about that? — A. No. Q. Can Mr. Chesebro tell that? — A. I dont know whether he can or not. Q. Didnt the New York Transit Company use to own the line in New Jersey ? — A. I dont know. Q. You dont know anything about that? — A. No sir. Q. Well now, I show you the balance sheet of the National Transit of December 31, 1905, showing the plant investment of the line for the Millway and Bayonne division. Mr. MiLBUEN. What balance sheet is that? Mr. Kellogg. The balance sheet of the National Transit for Decem- ber 31, 1905. Mr. MiLBTJRN. But they didn't own that line. Mr. Kellogg. I think it owned that line at that time. The next balance sheet shows a change. Mr. MiLBURN. It didnt own the line. Mr. Kellogg. All right. 676 Witness. I dont know anything about this. I am not a bookkeeper. Q. You are the general manager, arent you ? — A. Yes. Q. And the vice-president? — A. Yes, now I am. I was only gen- eral manager until a little while ago. Q. You were general manager in 1905 ? — A. Yes, general manager in 1905, but not the vice-president in 1905. Q. Did the National Transit Company own the line to Bayonne ? — A. I dont know. That wasnt in my department as general manager. Q. You dont know whether the New York Transit Company in 1905 owned the line fi-om Unionville to Bayonne, or whether the National Transit Company owned the line from Millway to Bay- onne? — A. I do not. PAYNE. 331 Q. What companies own the lines in New Jersey? — A. I dont know. Q. You dont know? — ^A. No sir. Q. Who operates them ? — A. The Standard Oil Company, I think, of New Jersey. Q. The Standard Oil Company of New Jersey operates the lines in Jersey? — A. I think so. I dont know positively, of my own knowledge. Q. You dont know what company operates the pipe lines in the State of New Jersey? — A. No, I dont know. Q. Yet you testified you are general manager of all their 677 lines, except the Prairie Oil & Gas ? — ^A. I told you I was only general manager of the gathering systems in these lines. I have not had the trunk lines under my charge. Q. Who does have the trunk lines ? — A. I told you that Mr. Towl now had them, until lately. Q. What ? — A. After Mr. O'Day died and I became vice-president. I have something to say now about the trunk lines as well as the others, but up until that time, up until November last Q. You became vice-president over a year ago, did you? — A. No, not over a year ago ; less than a year ago, considerable less than a year ago. Q. Very well. Mr. MiLBTjEN. Was that after O'Day died? Witness. After Mr. O'Day died. Mr. MiLBUEN. Mr. O'Day was, up to the time of his death. Witness. Up to the time of Mr. O'Day's death, he was the vice- president. I became the vice-president a few months after his death. Q. Very well, and since then you have had charge of the pipe lines? — A. Oh, general oversight, yes. Q. And you are not general manager now ? — A. No sir. Q. You dont know what company has operated the pipe lines in the State of New Jersey during the last year, or any part of it ? — A. I dont think I could tell you of my own knowledge who owns those pipe lines? Q. What company operates them? — A. The Standard Oil Com- pany of New Jersey. Mr. MiLBUEN. He said that. 678 Q. It does?— A. Yes sir. But you dont know what company owns them? — A. I dont know what company owns them, I have no knowledge of that. Q. Who operated them before the last year ?— A. I dont know. I never had anything to do with the pipe lines previous to that time. Q. Previous to the last year you didnt have anything to do with the lines ?— A. Not with the trunk lines, no sir. Q. Now, tell me the man who did. Mr. O'Day ?— A. Mr. O'Day was the principal man. 332 PAYNE. Q. Who else? — A. I think up until the time he died, Mr. J. H. Snow was the superintendent of all the trunk lines of the National Transit. Q. And where is he now? — A. He is dead. I dont know where he is. Q. And who took his place? — A. Mr. Forest M. Towl acted Q. Mr. Towl took his place ?— A. Yes, Forest M. Towl. Q. Is he now in immediate charge? Mr. MHiBUEN. We know where the Standard Oil people are. A. He is an engineer, and used in all ways in the gas business, and every way, figuring out the measurement of gas. He is an expert in those lines. Q. Would he know the company which owned and which operated these lines during the last four or five years ? — A. I think he would. I dont know. 679 Q. Forest M. Towl? — A. I dont know what another man knows, but I think he knows. Q. I notice, Mr. Payne, by your tariffs, that the New York Transit Company files no tariff showing a delivery of oil at any place except Unionville, New York. Is that correct? — A. I think so. Q. In other words, the tariffs of the New York Transit Company, and all companies connecting with the New York Transit Company, show the only delivery point of oil transported for other people, under those tariffs, to be Unionville, New York. — A. I dont think they have filed any tariff' at all — the New York Transit Company. Q. Well, the New York Transit Company joins with other com- panies in filing a tariff ? — A. They concur in a through rate to Union- ville, and no further. Q. And some of those rates are to Olean, New York, and the rest are to Unionville, New York? — A. Yes. Q. Now, Olean is a Standard refining point, isnt it? — A. It has been. Q. It is now, isn't it? — A. I guess it is. Q. No other refinery there except the Standard ? — A. Well, I think the Vacuum Oil Company. Q. That is a Standard, isnt it? — A. I guess so. I dont know whether it is or is not. Mr. MiLBURN. We will assume it to be. Mr. Kellogg "ies, let us assume tliat. 680 Q. Outside of the Vacuum and the other company, are there any refineries at Olean, New York? — A. I think not. Q. Then the Standard owns the only refineries there? — A. I think they do. Q. Now, Unionville is the only other place oil is taken for trans- portation under those tariffs? — A. Yes sir. Q. And Unionville is on the state line between New York and New Jersey, isn't it? — A. Yes sir. PAYNE. 333 Q. Well, is there any refinery there?— A. I dont think so. Q. Is there any town there of any size ?— A. I think not. Pipe lines dont run through towns. _ Q. Well, Union ville is simply an imaginary point on the state line, isnt It?— A. Oh, there are lots of imaginary points in state lines. Q. Unionville is one of them, isnt it?— A. They go through the wild country, away from towns. Q. Is Unionville one of them?— A. Unionville is a terminal of the New York Transit Company ; that is as far as it has any pipe line system. Q. Is there any station there ? — A. I think so. Q. When was it constructed? — A. I dont Imow. Q. Wasnt it constructed just after the passage of the Hepburn Bill in 1906 ?— A. I dont know ; I was in Europe. Q. Well, dont you know it was?— A. I dont know; I was in Europe. I dont know. Q. Well, you do know that no one, no refinery, no purchaser 681 of oil, no shipper of oil, would ever want it delivered at Unionville, dont you? Mr. MiLBURN. Isnf there a refinery there ? A. Well, I cant answer that, because we are delivering oil every day at Unionville. Q. You are? — A. Shippers of oil, yes. Q. Crude oil?— A. Yes. Q. To whom do you deliver it ? — A. We deliver it to the Standard Oil Company, I think. I dont know whom. Q. Yes, you deliver it to the connecting pipe line ? — ^A. We deliver it to the Standard Oil Company, I think. Q. Now, let us see. The pipe line of the New York Transit Com- pany connects there with the pipe line of the Standard Oil Company of New Jersey? — A. Yes. Q. And forms a connection to Bayonne? — A. Forms a connec- tion through, yes sir. Q. Now, what is there there at Unionville, at that connection ? — ^A. Nothing, only the end of the New York Transit line. Q. And the beginning of the other? — A. And the beginning of the other, that is all. Q. And when you say you deliver oil from the New York Transit Company to the Standard Oil Company, you mean you deliver it into the connecting pipe, dont you ? — A. Oh no, it always has to go into a station ; it has to go into an iron tank and be taken out again. Q. And goes on in the pipe line? — A. Yes. Q. There is a pumping station there, isnt there? — A. Yes. 682 Q. And you put it in there at the time this law was passed, didnt you ? — A. I dont know. I didnt put it in there. Q. Well, the Transit Company did?— A. The New York Transit Company ? Q. Yes. — A. They might have done so. 334 PAYNE. Q. You are the vice-president and general manager? — ^A. No, I am not the general manager. Q. You have no recollection of that being put in there? — A. No sir, because I told you I was in Europe when that bill was passed ; I was in Europe until the fourteenth day of October. Q. Was it there when you went to Europe? — A. I dont think it was. Q. And it was there when you got back ? — A. I think it was. Q. Well, now, I guess we have located it. (The witness laughs.) Q. And you went to Europe at what time ? — ^A. I went to Europe on the 4th day of July. Q. What year?— A. 1906. Q. And got back when? — A. 14th or 15th of October. Q. And the Hepburn Act was passed in July, wasnt it? (No answer). Q. Now, you say the New York Transit Company delivers oil there to the Standard Oil Company of New Jersey ? — A. I think so. Q. Is that tank right on the State Line? — A. I dont know; I never was there. 683 Q. You never was there? — A. No. Q. Well, you mean that the oil goes into the tank and then is pumped, and then goes into the pipes again and is pumped to Bay- onne. New Jersey, dont you? — A. The oil is delivered by the New York Transit Company into an iron tank, and from the iron tank it is pumped out into the lines of the Standard Oil Company of New Jersey, I think. Q. And goes to Bayonne ? — A. As far as I know ; I am not posi- tive. Q. And goes to Bayonne? — A. I dont know where it goes to. Q. Well, it goes on East to the seaboard, dont it ? — A. Well, it may go into an iron tank, it may go into a refinery ; I dont know where it goes to. Q. It goes on into the State of New Jersey? — A. It goes on into New Jersey. Q. To the seaboard ? — A. I dont know where the terminal is there. The refineries are on the seaboard. Q. Do you mean to say you dont know where the terminals of the pipe lines are, of the Standard Oil Company ? — A. Yes sir. I have never been there. Q. And you have no knowledge of them? — A. No. I know there is such a place as Meadowlands. Q. You do?— A. Yes. Q. Do you know there is such a place as Bayonne ? — A. Yes. Q. You do ? — A. Yes sir, but I have never been there. Q. And, therefore, you dont know that the pipe line runs 684 there, because you havent seen it with your own eyes, but you have seen the maps of it, havent you? — A. Why, yes, I think I have seen a map of the line that extends through New Jerse|y. PAYNE. 335 Q. Now, the Standard Oil Company does not take any crude oil out of its tank at Unionville and use it at that place, does it ? — A. No, 1 think not. Q. So that is the only delivery point, except Olean, for which you publish a tariff — the New York Transit Company ? — A. Yes, I think so. I dont know. I am not familiar with the tariff, but I think there are only two. Q. Well, that is a good deal of use to the shipping public, isnt it? — A. Well, there is Buffalo. Buffalo, Olean and Unionville. Mr. MiLBUEN. All the stations it ever had. They can build new stations. Q. I notice by these tariffs that the Indiana pipe line company, in connection with the Buckeye Pipe Line Company, Northern Pipe Line Company, National Transit Company, and the New York Transit Company publish a through tariff from Griffith, Indiana, to Unionville, New York? — A. Yes. Mr. MiLBtJEN. They have no line beyond. Q. Now, there are five companies joining in a tariff. — A. Yes. Q. Will you tell me why it stops at Unionville instead of going on to the seaboard? — A. Because the companies joining 685 in that tariff do not own any lines beyond. Q. But the same parent line owns the line in New Jersey? The Standard Oil Company of New Jersey owns it, you say? — A. I think so. I dont say that of my own knowledge. Mr. MiLBUBN. The line in New Jersey is a private pipe line. It is not a public pipe line, and never has been. Mr. Kellogg. Oh yes, only those tariffs are published which you wish to publish. Q. Now, Mr. Payne the Indiana pipe line company does not own the line in Ohio or Pennsylvania or New York, as you say, and yet those four or five companies join in a through tariff from Griffith, Indiana, to Unionville, New York. Why could not the Standard Oil Company of New Jersey, which owns the line from Unionville to Bayonne, join in that tariff also? Mr. MiLBUEN. I object to that question as asking for a pure specu- lation ; not asking for any fact to which the witness could testify, but merely as to the policy of some company with which he is not con- nected, or of which he is not an officer. A. I dont know. Q. You dont know that ? — A. No sir. Q. You do know, as the tariff is now, that nobody has ever shipped any oil to Unionville; dont you?— A. Nobody has ever asked for any oil to be shipped. Q. Nobody is likely to, are they?— A. They might. I dont know. Q. Of course somebody might go to UnionviUe and build a 686 refinery. — A. Nobody asked to have it shipped to Buffalo. We have never been asked to have any oil shipped under this tariff, under any of these tariffs. 336 PAYNE. Q. Prior to the establishment of this station at Unionville out here on the State line between Jersey and New York, you pumped the oil straight through across the state line, didn't you? — A. Previous to that? Q. Yes. — A. I think so. Q. Well, let us take another. What other of the Standard lines of pipe extend to the seaboard? — A. The National Transit extends to the seaboard, to Philadelphia. Q. Extends to Philadelphia?— A. Yes. Q. AYell, I mean New York harbor. — A. None of them extend to New York harbor, that I know of. Q. Well, dont you know that there is another line across the state of New Jersey? — A. Yes sir. Q. Belongs to some company connected with the Standard ? — A. I think the Standard have another line across the state of New Jersey. Q. Where is it? That is what I asked you. — A. I think it runs from — well, I cant give you the name of that place. Q. I presume not. It is insignificant. It is called Centerbridge, isnt it? — A. Yes, Centerbridge. Q. No wonder you have forgotten it. Centerbridge is on the line between Pennsylvania and Jersey, isnt it? — A. Yes sir. Q. What lines connect there? — A. The Southern Pipe Line, 687 I think, connects there. Q,. The Southern Pipe Line comes through Pennsylvania ? — A. Yes. Q. And connects with what line? — A. What do you mean? Con- nects where? Q. At Centerbridge? — A. At Centerbridge? Q. Yes. — A. I think it connects with the Standard Oil Company line there. Q. The Standard Oil Company of New Jersey? — A. Yes sir. Q. Centerbridge is the place where all of the tariffs of the lines from the west show as the eastern delivery point of oil, is it not ? — A. I think the tariffs show that, yes sir. Q. Yes sir. I notice the Buckeye Pipe Line publishes a tariff in connection with the Southwest Pennsylvania Pipe Lines, the Eureka Pipe Line Company, the Southern Pipe Line Company, and the National Transit Company, from Lima, Ohio, to Centerbridge, Pennsylvania. — A. Yes. Q. Is that correct? — A. I think so. I couldnt identify it from your list. I think there is such a tariff' in. Q. Well, the lines west of Centerbridge make Centerbridge as the eastern terminus at which they will deliver oil for the public under these tariffs? — A. That is what the tariff says. Q. That is your understanding of it, isnt it? — A. Yes sir. Q. Now, Mr. Payne, what is there at Centerbridge? — A. I 688 never was there. I dont think there is much of any place there. PAYNE. 337 Q. What have you got there ? There is where the two lines con- nect; dont they? — A. Yes. Q. Is there a pumping station there ? — A. I think so. Q. Was that constructed after you left for Europe and before you got back? — A. I dont know whether that one was or not. The hearing was here adjourned until the morning of Thursday, September 26, 1907, at 10 :30 o'clock. 689 Thursday, September 26, 1907. The hearing was resumed at 10 : 30 A. M. Calvin N. Payne, recalled as a witness on behalf of Petitioner, testified as follows: Direct examination (resumed) by Mr. Ket.logg: Q. Centerbridge, you stated, is the connection between the lines leading from the Pennsylvania state line to the New York harbor, and the lines reaching the New Jersey line from the West?— A. It is the terminal of the lines in Pennsylvania. Q. Jvow, you said there was a station built at Centerbridge?— A. Yes sir, there is a station there. Q. That station is merely a pumping station ? — A And iron tanks ; there are iron tanks besides the station. Terminal iron tanks. Q. Of the Standard Oil Company ? — A. 'No, the iron tanks are the pipe line. Q. I mean the pipe line. — A. The station belongs to the Standard Oil Company. Q. The iron tank belongs to which company?— A. The National Transit Company, I think. Q. The pumping station belongs to what company? Mr. MiLBTJEN. Do the tanks belong to the National Transit or the New York Transit? Q. At Centerbridge. 690 Mr. MiLBUEN. He is speaking now of Centerbridge, that is at Pennsylvania. The question was read : " The pumping station belongs to what company?" A. I think it belongs to the Standard Oil Companv, the station. Q. Of New Jersey?— A. Yes. Q. On which side of the river is that? — A. I dont know; I never have been there. Q. Well, that is merely a pumping station the same as UnionviUe, isn't it? — A. It is a pumping station, yes, the same as UnionviUe. Q. When was that put in ? — A. I dont know when that was put in at Centerbridge. Q. Well, about? — A. I dont know. Q. Wliat did such a station as that cost? — A. Oh, probably a hun- dred thousand dollars, something like that. Q. Now, you have pumping stations all along your line, dont you ? — A. Yes sir. 32555—08 22 338 PAYNE. Q. And that is a regular pumping station? — A. That doesnt be- long to the National Transit Company. Q. I dont care whom it belongs to, it is a pumping station ? — A. It is a pumping station. Q. Like many others you have ? — A. Similar ; they are all similar. The pumping stations are all similar. Q. From 30 to YO miles along your line you have these G91 pumping stations? — A. Yes sir. Q. And they are for the purpose of pumping the oil through the pipes? — A. Yes sir. Q. And that is what this is, one is at Centerville ? — A. For pump- ing the oil through a pipe line, yes sir. Q. It is not a delivery station any more than the rest of your pumping stations, is it? — A. A pumping station is not a delivery station. Tanks are delivery points. Q. Is this a delivery station ? — A. It is a pumping station. Q. That is it. Mr. MiLBUEN. But Centerbridge is a delivery station, is it not? Witness. You dont require a pump to deliver oil to the station. Q. Very well. Is Centerbridge a deliveiy station? — A. Yes sir. Q. But all the oil that goes into the tanks at Centerbridge goes on to New York Harbor, doesn't it ? — A. It has to be taken on. Q. To New York Harbor? — A. It has to be taken on, by the own- ers, yes sir. Q. Through the pipe lines? — A. Yes sir. Q. To New York Harbor?— A. Yes sir. Q. It is not a delivery station from which oil is taken out for any other place? — A. There has been no demand there for delivering oil there. 692 Q. There are no refineries at Centerbridge ? — A. No sir, not that I know of. I never was there. Q. Now, all pumping stations have tanks, dont they ? — A. Yes sir. Q. And the oil goes into the tanks and then is pumped out to go on through the pipe line ? — A. The oil is delivered into the tanks. Q. And there is no difference between this pumping station in that respect, at Centerbridge, than any other pumping station? — A. Practically, the operation is the same as at other stations. Q. They are built for the purpose of pumping the oil on to New York Harbor, arent they? — A. The pumping station was built for that purpose, of course. Q. And this particular pumping station was built for the same purpose? — A. I suppose so. Q. Well, you were the general manager when it was done? — A. Of building that station ? I had nothing to do with it. Q. You were general manager of the pipe line company? — A. Yes, but not of the Standard Oil Company of New Jersey. Q. Now, isnt that pumping station some three hundred yards into Pennsylvania? — A. I think it is in Pennsylvania; I am quite sure it is in Pennsylvania. PAYNE. 339 Q. So it is on the property of the National Transit? — A. I dont know whether it is on their property or not. Q. And was built by the National Transit Company, wasn't 693 it ? — A. It wasnt built by the National Transit Company. Q. It wasnt. I show you the balance sheet of the National Transit Company for the year 1906, an item " New tankage at Dela- ware Eiver, $13,427.90." — A. New tankage at Delaware River? Q. That would indicate that the National Transit Company built new tankage, there, wouldnt it? — A. They did, yes sir. Q. There is no other tankage there except the tankage connected with that pumping station? — A. No, there is a delivery point there just the same as any other station. Q. The National Transit Company, then, built the tanks, did it? — A. Yes. Q. And built them in 1906 ?— A. I think so. Q. And the tanks were built for the purposes of this pumping sta- tion ? — A. The tanks were built for making a delivery point there. Q. Well, for the pumping station, wasnt it? — A. Well Q. Well, to whom do you deliver oil there? — A. We deliver it to the Standard Oil Company. Mr. MiLBTjEN. If you ship oil there it would be delivered to you in the tanks ? Mr. Kellogg. We will see about that. Q. You deliver oil to the pipe lines of the Standard Oil Company, dont you? — A. We deliver the oil to the owners of the oil at that station. 694 Q. To whom have you delivered any oil there since 1906 ? — A. I think the Standard Oil Company. Q. Of New Jersey ? — A. Yes sir. Q. The owner of the pipe line from the Jersey line to Bayonne? — A. I think so, yes sir. Q. The tanks were built simply for the purpose of the pumping station, to deliver oil into the pipe lines of the Standard Oil of New Jersey, werent they ? — ^A. Mr. Kellogg, you must have iron tanks to measure the oil in, or you cant tell how much you deliver to any one company. Mr. Kellogg. Please repeat that question. That is not an answer to my question. The question was read. A. The tanks were built for the purpose of making a terminal sta- tion, of the National Transit Company. Q. To whom ? — A. To anybody that owned the oil ; whoever owned the oil. Q. And it has been used for what purpose?— A. Delivering oil to the owners at that point. Q. And who were the owners?— A. The Standard Oil Company, I think, owned most that has been delivered there. Q. Of New Jersey?- A. I dont know of any other delivery. 340 PAYNE. Q. Now, werent those tanks built for the purpose of delivering oil into these tanks and be taken out there and delivered around the coun- try?— A. It could be; if a man wanted to build a refinery there, it could be delivered there. 695 Q. There are no refineries there? — A. No. Q. They have been used exclusively to deliver oil into the pipes of the Standard Oil Company of New Jersey to transport it to Bayonne? — A. I dont know that there has been any other ownership in through there. Q. Then it has been used exclusively for that purpose ? — A. Yes. Q. Then why didnt you say so? Mr. MilbtjejST. That is not proper. He said the only oil that has been transported there is for the Standard Oil Company of New Jersey, but anybody could have oil transported there and delivered. Now, that is what he said. Q. Then the purpose of building them was to deliver oil into the pipes of the Standard Oil Company of New Jersey, wasn't it? — A. The purpose was to make a delivery point, I stated emphatically, to make a delivery point to anybodj^ that wanted oil at that point. Q. Did you spend a hundred thousand dollars to build those tanks and that pumping station to deliver oil to anybodj^ except the Stand- ard Oil Company? — A. We didnt spend one hundred thousand dol- lars to build those tanks and that station. Q. Did you spend any sum of money ?^A. We built the tanks, and the balance sheets show what was spent for the tanks. Q. Did you do that for the purpose of delivering oil to anybody except the Standard Oil Company of New Jersey? — A. We 696 could deliver oil to anybody that had it — that demanded it there. Q. Is that the reason you built them, to deliver to somebody else besides the Standard Oil Company? — A. AVe built them to make a delivery point there. Q. But not for the Standard Oil? — A. Built them for anybody. Q. You didn't build them to make a delivery to the Standard Oil? — A. We built them for anybody, — to inake a delivery to any- body. Q. And they were built in 1906 ? — A. I think so ; according to that balance sheet they showed me, I should say thej^ were built in 1906. Q. How did you deliver oil into the pipes of the Standard Oil Company prior to 1906 '( — A. How did we ? Q. Yes sir. — A. We made deliveries into their lines from the near- est station back of that station. Q. Where was the station? — A. The names dont come to me quickly. Fawn Grove — not Fawn Grove, but the big station back. Mr. MiLBUEN. Oh, call it X. Mr. Kellogg. No, we wont call it X. Mr. MiLBURN. Then you tell him what it is. Witness. The nearest stiition west; delivered oil there. PAYNE. 341 Q. For many years these pipe lines had been operated and oil delivered to Bayonne without a station at Centerbridge, had they not? — A. Many years, yes sir. Q. And then, in 1906, you buUt this pumping station? — ■ 697 A. I didnt build it. Q. Well, the company. You know whom I mean. — A. The National Transit built it. Q. Mr. Payne, what occasion arose from the construction of a pumping station on the line between New York and New Jersey and on the line between Pennsylvania and New Jersey and on a line between Pennsylvania and Maryland, all in 1906? — -A. I dont know unless there was some legal reason. Q. Yes. Now, tell us the legal reason. — A. Well, I dont know. Q. You dont know? — A. I dont know. Q. "Wlio directed you to spend that amount of money. — A. I wasnt directed to spend it. Q. You did it without direction? — A. No sir, I wasnt directed; I wasnt in this country. Mr. MiLLBURK. Well, I advised them that they had to. Mr. Kellogg. You advised them? Mr. MiLLBUEN. I advised them that they had to do it, if you want to know the real legal reason; that the law compelled them to do it. That is how it came to be done. Mr. Kellogg. The law, in my judgment, didnt compel them to build a delivery station where there was no oil to be delivered. Mr. MiLBUEN. Well, I thought it did, you know. There was no line any place else. Mr. Kellogg. Why couldnt it be put where the oil could be 698 used, on the New York Harbor? Mr. MiLBUEN. Could be, just as well as any other point, but you are asking where the legal advice came from. Now you have got it. Mr. Kellogg. Well, I am very glad to know, because I think it is very poor. Mr. MiLBUEN. Well, it hasnt proved poor. Q. Mr. Payne, where is Fawn Grove?— A. On the Maryland line, between Pennsylvania and Maryland. Q. Have you a pumping station there ? — A. Yes sir. Q. Similar to the one you have at Centerbridge and Unionville?— A. The Standard Oil Company has a little bit of a station there. Q. Has a little bit of a station?— A. Yes. Q. It is the same kind except in size, is it?— A. No, that is a small station. That is only a four inch line. Q. Well, it is smaller, but it is of the same kind?— A. Yes. Q. It has the pumping station and the tanks?— A. Yes. Q. When was that built?— A. 1906, I think; I dont know. Q. 1906. Now, Fawn Grove is on the line between Pennsylvania and Maryland, you say? — A. Yes. 342 PAYNE. Q. On the line leading to Baltimore? — A. Yes sir. Q. Baltimore is a place where there are refineries? — A. Yes sir. 699 Q. The Standard Oil Company has a refinery there? — A. I think so. Q. And what is the name of the line that leads from the state line of Pennsylvania down to Baltimore? — A. That belongs to the Stand- ard Oil Company. Q. Of New Jersey? — A. Yes sir. Q. How long has that line belonged to the Standard Oil of New Jersey? — A. Since November 1, 1905. Q. Since November 1, 1905. Is it operated by the Standard Oil Company of New Jersey ? — A. Yes sir. Q. How long has it been operated by that company? — A. Since that time, I think, as far as I know. Q. Then that connects on the state line with what line of Penn- sylvania ? — A. I think it is the National Transit Company. Q. The National Transit Company? — A. Yes, I think so. Mr. MiLBURN. T\Tiere is Fawn Grove? How far is that from the state line? Witness. Fawn Grove is right on the state line, or close to it. Q. Going back a moment to Centerbridge. You say it is the National Transit's line that connects at Centerbridge with the New Jersey line ? — A. Now, I wouldnt be sure whether that is the National Transit Company or the Southern Pipe Line. Q. Well, isnt it the Southern? — A. It may be the Southern, I wouldn't be sure now. 700 Q. Well, who would know about that?— A. Mr. Towl, Mr. Forest M. Towl, who managed it after Mr. Snow's death. Mr. MiLBURN. Do you know if it is the National Transit Company, the Millway Witness. I think it is. Mr. MiLBUEN. The Millway to Centerbridge division, I think it is the National Transit. Witness. I think it is the National Transit, yes. Mr. MiLBURN. If you will state just what you want, we will get it definitely. Q. Well, coming back to the Fawn Grove, that was constructed in 1906?— A. I think so. Q. And did you say what line in Pennsylvania that was connected with? — A. The National Transit Company. Q. The National Transit Company ? — A. Yes. Q. Connects at Fawn Grove with the Standard Oil of New Jer- sey's line ? — A. Yes sir. Q. From Fawn Grove to Baltimore? — A. I am liaving a set of maps prepared for you that will be very much clearer in these mat- ters, because it is very complicated in that way. PAYNE. 343 Q. Thank you, I will be very glad to ha^ e it. When will they be ready ?^A. In a day or two, I think. It will take some little time to cover the whole situation. Q. Now, so far as the operation of that station is concerned, 701 it is operated in the same manner as the one at Unionville and at Centerbridge ? — A. Practically so, yes sir. Q. It is simply used as a pumping station ? — A. Yes sir. Q. And all the oil that comes there is pumped into the pipes of the Standard Oil of New Jersey to go on to Baltimore?— A. Yes sir. Q. There are no refineries there? — A. At Fawn Grove « Q. Yes.— A. No. Q. Is there a town there?— A. I thing so; a small place. Q. A small place?— A. I find there is a town of Unionville and at Centerbridge, too. Q. How large is Centerbridge ?— A. I dont know how large; 200 inhabitants, anyway; a small place. Q. And Centerbridge? — A. And Centerbridge is, too. Q. You think that is a small place? — A. Both have post-offices, I think you will find. Q. And Fawn Grove ? — A. Fawn Grove, I dont know whether that has or not. Q. There are no industries there taking oil? — A. I think not. Q. So that the only way to get oil to Baltimore is to run through Fawn Grove, isnt it, by the pipe lines of any of the Standard com- panies ? — A. By way of the Transit Company, yes sir. Q. Any of the Standard companies? — A. Yes sir. Q. And the only way to get oil to Bayonne or the New York Har- bor anywhere, or Brooklyn, by pipe line, is through Unionville and Centerbridge, by any of the Standard companies; that is cor- 702 rect, isnt it?— A. I think so. That is, to New York Harbor. Q. That is what I am talking about. — A. Yes. Q. Now, you have a line of pipe which files a tariff to Marcus Hook, Pennsylvania? — A. Yes sir. Q. The Buckeye Pipe Line seems to file a tariff in connection with the Northern Pipe Line Company, the National Transit Company, the Southwest Pennsylvania Pipe Lines, and the Crescent Pipe Lines, to Marcus Hook, Pennsylvania, from Cygnet, Ohio? — A. Yes sir. Q. Is that correct? (Handing witness paper.) — A. Well, I dont know ; I dont know anything about this list. Q. I can show you the tariffs, if you want to see them. — A. I think there is a rate filed embracing those points. Q. Now, Marcus Hook, Pennsylvania, is a shipping point of the Standard Oil, isnt it, or of some company connected with it?— A. There is a great deal of oil business done along the river there from Point Breeze to Marcus Hook. Q. Wliere is the delivery station of this pipe line?— A. At Marcus Hook. Q. At Marcus Hook?— A. I think so. 344 PAYNE. Q. What is it used for ? — A. For delivering the oil to the owners, whoever they are. Q. What owners have you delivered oil to there within the last two years ? — A. Oh, I dont know ; I dont do the delivering. I couldnt tell you what oil is delivered there in the last few years. Q. Has the Standard Oil Company or any of its companies 703 a refinery at the terminus of this pipe line ? — A. I think there is a refinery there. Mr. MiLBUEN. At Marcus Hook? Witness. Yes sir, near there. Point Breeze, I think it is. Q. Do you know whether that line to Marcus Hook has ever de- livered any oil to anybody except Standard concerns? — A. I dont know. Q. Well, what do you think about it ? — A. Well, when I dont know I cant think much about it. Q. You have a general knowledge of the business of the pipe line companies, havent you? — A. I dont know whether they have de- livered any oil to anybody else or not. Q. The books of the pipe line company show to whom they deliver oil ? — A. I think they would, yes. Q. And you have been general manager for how many years ?^A. General manager of the National Transit Company for ten or fifteen years. Q. You also have a tariff by the Buckeye Pipe Line and the North- ern Pipe Line and the National Transit and the Southern Pipe Line Company from Cygnet, Ohio, to Philadelphia, from Lima, Ohio, to Philadelphia, haven't you ? — A. You ask if we filed a rate ? Q. Yes. — A. I think so. Q. Now, Philadelphia is a refining point of the Atlantic Ee- fining Company, isnt it? — A. They have one refinery there, 704 called the Atlantic Refinery. Q. Do you know whether this pipe line delivers oil to that refinery? — A. I think so. Q. Does it deliver oil there for any other purposes? — A. I dont know. Mr. MiLBUEN. WTiich one is that ? Witness. That is a large refining point. Q. It is a large refining point of the Atlantic Eefining Com- pany ? — A. And other people, too. Q. Do you deliver oil there to anybody else ? — A. I dont know. Q. You dont know ? — A. No. Q. Who would know in the Transit Company? Mr. MiLBTjEN. "What point is this? Mr. Kellogg. Philadelphia. Mr. MiLBTJEN. Well, he can find out if you want him to get any in- formation. Q. What is the Crosstown Pipe Line ? — A. What is what ? Q. What is the line that you call the Crosstown line? — A. I dont know anything about it. PAYNE. 345 Q. Well, is there a line across New York to Brooklyn? — ^V. I dont know whether there is or not. Q. You dont know whether any of the Standard Companies has a pipe line across to Brooklyn? — A. No, I have only heard so, but I dont know so. Q. From whom did you hear it? — A. I have read stories about it. 705 Q. You have read stories about it? — A. Yes sir. Q. In the papers? — A. Yes sir. The only pipe line across Central Park, but I dont know it. Q. You dont know, then, whether there is a pipe across to Brook- lyn or not — across New York ? — A. I dont know that there is now or not. As I say, I have read about a pipe line being across the East River and across the North River. Q. And you have been the manager of all these pipe lines you have named for all these years? — A. I havent been the manager of that, Mr. Kellogg. I have told you so. Q. Of what ? — A. I have been the manager of the gathering system of these pipe lines, not the trunk system. Q. Well, a few moments ago you said the general manager of the National Transit for ten years, or fifteen. — A. Yes sir, of the Na- tional Transit United Pipe Line Division. That is the gathering division. Q. Then you are general manager of simply the gathering lines ? — A. Yes sir, that is what I have been all the time. Q. And who is the general manager of the pipe lines? — A. Mr. O'Day was. Q. Have you had any general manager of the pipe lines since his death? — A. Since his death? Q. Yes. — A. I took his place in a month or few months after, as vice-president. I dont think that they had any general 706 manager since. Q. Then you are vice-president of the trunk lines, are you ? — A. Yes sir, I am now. Q. You are now ? — A. For the last few months, yes sir. Q. And as such vice-president, you dont know whether there is a pipe line across New York to Brooklyn or not ? — A. Oh, I think there is, but I dont know it of my own knowledge. Q. You think there is ? — A. I think there is. Q. Now, doesnt the New York Transit Company operate that line? — A. I dont know. Q. Did it in 1905 ? I show you the balance sheet of the New York Transit Company, an item in its operating expenses for " Rentals of the Crosstown Pipe Line, $438,191.03." — A. I dont know anything about this, Mr. Kellogg. Q. You dont know anything about it ? — A. No sir. Mr. MiLBUEN. For rentals, it says ? Mr. Kellogg. Yes sir. Q. You dont know anything about it? — A. No sir, I do not. 346 PAYNE. Q. Mr. Payne, as vice-president, what are your duties? Let us see what you do know about the pipe lines. — A. As vice-president ? Q. Yes sir. — A. Principally the signing of my name to pa- pers. 707 Q. Do you read the papers that you sign? — A. Some of them, yes sir. Q. Dont you have general direction of the business ? — A. No sir. Q. Who does? — A. ^Vhj, the board of directors of the National Transit Company. Q. I mean dont you have immediate dii-ection of the business? — A. I am in touch with it all the time, yes sir. Q. Arent you in charge of it ? — A. Practically so. Q. You are vice-president of the New York Transit Company? — A. Yes sir. Q. Do you know what lines the New York Transit Company oper- ates? — A. I know principally, yes sir. I dont know whether they operate any line across the East River and North River or not. Q. Do you know whether they operate the line across the state of New Jersey? — A. Do I know that they do? Q. Yes. — A. No sir, I know they dont. Q. You know they dont. Do you know whether it did operate the line across New Jersey prior to 1906 ? — A. Yes sir, prior to November, 1905, 1 think. Q. Then, prior to November 1, 1905, the New York Transit Com- pany operated the line across the state of New Jersey from Union- ville to Bayonne, did it? — A. I dont know for sure. I think it did, though. I was not in charge of that part of the work, that part of the business, at that time. Q. But you dont know whether it operated the line to 708 Brooklyn across New York? — A. I do not. I dont know whether the refineries owned that line, or if there was a line there or not. In a general way, I thought there was a line there. Q. Now. Mr. Payne, where is your office? — A. T^Tiere is my office? Q. Yes, now. — A. 26 Broadway, now. Q. Do you have any reports made to you from any of the officials or agents, employees of the Transit companies ? — A. No ; no reports made directly. Q. Well, whom are they made to? — A. If I want to know any- thing, I go to the different departments and find out. Q. Dont you have submitted to you monthly statements showing the business of each pipe line company in which you are an officer ? — A. Yes, that is submitted to me. Q. Well, submitted to you, that is what I asked. — A. There is a report submitted to me. Q. Now, what does that report show? — A. Well, it would take more than I can tell you to repeat a report like that here when there are so many of them, a number of them. Mr. MiLBTjEN. In substance, Mr. Kellogg wants to know. Witness. The substance? PAYNE. 347 Mr. MiLBTjRN. Not the contents of any particular report, but the matters reported. Witness. Well, it shows an analysis of the expenses and the cost of repairs, and all that sort. It is simply an analysis of the operation of the line. 709 Q. It shows the quantity of oil transported. — A. I would not be sure ; I think it does. Q. The rates received for transporting it ?— A. I dont think so. Q. The amount received for transporting it, in a lump sum?— A. I think it shows the earnings. Q. The earnings? — A. I think so, yes. Q. The expenses, the operating expenses? — A. Yes sir. Q. The details of that operation?— A. A:fialysis of the expense account, I think. Q. Well, it shows the expense per barrel, does it not, reduced to barrels? — A. No. Q. It does not?— A. No; no, I dont think so. Q. Well, that can be computed from those statements, cant it?— A. In a general way. Q. It shows the barrel run ?— A. I think it shows the amount of oil handled. Q. Now, those statements, you say, are made monthly ? — A. Yes. Q. Who makes them? — A. I think the bookkeepers, the chief bookkeepers. Q. At 26 Broadway ? — A. No, made at different offices. Q. At different offices? — A. Yes; in Ohio and Pennsylvania. Q. And they are sent to 26 Broadway? — A. Yes sir. Q. To whom are they sent? — A. I think they are sent to the controller. 710 Q. To Mr. Chesebro or his predecessor? — A. I dont know whether they are sent to him now. He has only been con- troller a little while. Q. Well, they are sent to the controller's office? — A. Yes. Q. And by him submitted to you? — A. Yeg. Q. You examine those, dont you ? — A. I do ; I see them often. Q. And in order to know the operation of these companies? — A. Yes sir. Q. Are these reports entered in a book in the controller's office, do you know? — A. I dont know. I dont know what is done there. I have nothing to do with the bookkeeping. Q. They are kept in the controller's office, then? — A. I think so; that is, that is where I see them, in the controller's office. Q. Do you make in your office any synopsis of these reports? — A. No. Q. You just examine them? — A. Yes. Q. Does the controller make any synopsis of them? — A. I dont know whether he does or not. Q. They are kept by the controller, are they? — A. That is where I see them, in the controller's office. 348 PAYNE. Q. He has them yet? — A. I dont know. Q. You dont know. Well, now, at the end of the year are those statements condensed into an annual statement? — A. No, I think nothing more than the December statement shows the business of the year. Q. Yes, the December statement shows a resvime of the busi- 711 ness of the year, does it? — A. I think so. Q. Which would comprise all of the other reports from the beginning of the year? — A. Yes. Q. Those reports are kept — those December reports are kept there in the office of the comptroller ? — A. I dont know, I think so. What reports I have seen I have seen from his office. Q. For whom do you deliver oil from the New York Transit Com- pany into the pipes of the Standard Oil Company of New Jersey at Union ville? — A. For whom do we deliver oil? Q. Yes. — A. For the owners; I dont know whether there is more than one or not, or more than two, or more than a dozen; I dont know. I dont have the handling of the oil. Q. The pipe line companies buy oil, dont they? — A. No sir. Q. Dont the pipe line companies buy any oil? — A. No sir. Q. They do not ? — A. No sir. Well, they buy to make their short- age good once in a year or six months, or something like that. Q. Who buys the oil from the wells in the field ? — A. Joseph Seep. Q. What? — A. Joseph Seep buys some of the oil from the wells. Q. He is the purchasing agent for the Standard Oil Company? — A. I suppose. I have seen such title as that. Q. Do the books of the Pipe Line Company show for whom oil is transported? — A. Yes sir. 712 Q. Do the reports made to the controller at your office show that? — A. I think so. Q. They do? — A. I think the reports will show, the reports of the receipts and deliveries of oil will show whom they were for. Q. Then you deliver oil at Unionville into the pipes of the Stand- ard Oil Company of New Jersey? — A. Yes sir. Q. For various owners? — A. I dont know how many there are; whoever they are, whoever the owners are. Mr. Rosenthal. You deliver it into the tanks, dont you? Witness. We deliver it at the delivery points, the tanks. Q. And from the tanks the oil is delivered into the pipes of the Standard Oil Company of New Jersey at Unionville? — A. The oil goes into the iron tanks at the end of the New York Transit line. Q. Then it goes out of the tanks into the Standard of New Jersey? — A. Yes, it is delivered to the Standard Oil Company of New Jersey. Q. You do that for various owners, do you say? — A. We would if there were any owner. Q. Well, have j'ou done it ?• — A. I dont know. Mr. MiLBtJEN. He has said over and over again No. Q. Have you delivered it for various owners, or have you not? — PAYNE. 349 A. I dont know. I have repeatedly told you I dent know be- cause I dont handle the oil. I am not the dispatcher of 713 the oil. Q. The Transit Company handles it? — A. Yes sir. They deliver it into the tank. Q. The books of the company will show? — A. The books will show. Q. For whom oil is transported ? — A. Yes sir, I suppose so. Q. Across the state of New Jersey, wont they? — A. The books of the National Transit? Q. Yes.— A. No. Q. The books of the New York Transit?— A. The books of the New York Transit Company will show whom it was delivered to at Union ville. Q. When it is delivered at Union ville, it has to go on, doesnt it ? — A. Well, if the owner wants it to go on yes. Q. And when it leaves Unionville, it goes to Bayonne, doesnt it, or to Brooklyn? — A. I suppose so, yes sir. Q. Then the same oil that you deliver is transported across Jersey, isnt it? — A. I presume so. Q. Then do you know from whom you have delivered oil and for whom oil has been transported across Jersey? — A. I dont know. Q. Well, for more than one person? — A. I know we have for the Standard Oil Company. I dont know whether there is anybody else or not. Mr. MiLBTJRN. Hasnt he testified over and over again that it is the Standard Oil Company of New Jersey ? Mr. I^LLOGG. No, he hasnt. 714 Mr. MiLBUEN. Well, I understand him certainly to have said that, and that nobody else had ever tendered any oil. Mr. Kellogg. He says he doesnt know who they are. Witness. I just said I knew we delivered oil to the Standard Oil Company of New Jersey. Q. You dont know whether you did to anybody else or not? — A. T dont know whether there is anybody else or not. Q. The books will show, wont they ?— A. The books ought to show. Q. The pipe line companies issue pipe line certificates, dont they ? — A. Some of them. Q. What companies do?— A. The National Transit Company did and do yet, for anybody that wants it. Q. What other companies ?— A. The Buckeye Pipe Line Company did. Q. Does yet ? — A. I think it would, yes, if there was any demand for it. Q. What other companies?— A. I dont know of any other that issues certificates or ever have been called upon to issue any certificates. Q. No other companies that you know of ? — A. Well, the Pure Oil Company issues certificates. 350 PAYNE. Q. I am talking about the Standard companies. — A. Oh.. I dont know of any other that issues certificates. I dont think the South- west or the Eureka, — I dont think they do, nor the Indiana. 715 Q. Well, years ago, they used to issue a good many certifi- cates, didnt they ? — A. The National Transit Company issued a good many, years ago. Q. And those certificates were sold in the market, were they not ? — A. Yes sir. Q. And they were good for the delivery of oil at New York Har- bor? — A. No sir. Q. They were not? — A. No sir. Q. "Where ? — A. They were good for the delivery of oil within the district where it was produced. Q. Within the district where it was produced? — A. Yes, on the system of the company within the district where it is produced. Q. Never issued any certificates good for the delivery of oil at New York Harbor? — A. I think not. Q. What ? — A. Not that I know of ; I dont think so. Q. AVell, what do you mean by ' in the district where the oil was produced ' ? — A. Within the United Pipe Line system ; the United Pipe Line division system. Q. You mean the local gathering lines? — A. Wherever those gath- ering lines reached, for any station where they reached. Q. That is, the National Transit Company issued certificates for oil which it took into its pipes? — A. Yes sir. Q. Say in Pennsylvania? — A. Issued certificates for balances that anybody had on the books of the company — balances of oil. 716 Q. That is, oil that had been taken into the pipes ? — A. Yes. Mr. MiLBURN. And into its receiving tanks. Q. And those certificates were sold on the market, were they? — A. Yes sir. Q. And were good for a delivery to the purchaser or owner of those certificates of oil at certain places ? — A. Yes sir. Any regular point on the pipe line system. Q. Any regular delivery point on the pipe line system of the Na- tional Transit? — A. Yes sir. Q. So that the National Transit Company has been, in years past, engaged in transporting oil for other people? — A. Storing, yes. Q. And transporting ? — A. Yes, storing and transporting. Q. And do you say that no certificates were ever issued by the National Transit Company for the delivery of any oil at New York Harbor ? — A. No sir. Q. Never. Or Philadelphia ?— A. I think not. Q. Are you sure of it ? — A. I think not. Q. Or Marcus Hook?— A. I think not. Q. When Mr. Seep buys the oil and delivers it to any of the pipe lines of the Standard Organization, what do you issue on the receipt of that oil? I mean what does the pipe line company issue. — ^A. Issue to whom ? PAYNE. 351 Q. To Seep or to anybody. — A. It doesnt issue anything to him. Q. You do not issue anything ? — A. No. It is put on the books to his credit. 717 Q. It is put on the books to his credit? — A. Yes. Q. As received at A. It is transferred from the pro- ducer's account with the business over to his shipping account. Q. Now, is all oil that is purchased by the Seep Agency, or by any of the Standard companies, transferred to Joseph Seep's name on the books of the Transit Company ? — A. Is all the oil ? Q. Yes. — A. All the oil that he purchases is transferred, yes sir. The last few questions and answers were i-ead. AViTNESS. I want to qualify that first answer. Mr. Kellogg. Qualify it. "Witness. I think it is put to P. S. Trainor's credit. Q. P. S. Trainor's credit? — A. Yes. I think Mr. Seep purchases orders on credit balances of the producers, and the order is trans- ferred to the credit of P. S. Trainor, signed by the producer, so much oil. Mr. Seep takes that order and turns it in, and it is put to P. S. Trainor's account. Q. Does it show on your books whether the oil belongs to the Standard Oil Company of New Jersey, the Atlantic Kefining Com- pany, or any of the companies of the Standard organization? — A. I do not think so. Q. You dont think your books show? — A. I think, as far as the books show, it is P. S. Trainor's account, that he has so much oil. Q. P. S. Trainor's account? — A. Yes sir. 718 Q. Is that true of all the pipe lines? — A. I dont know. I think so. I am not sure about that. Q. Who would know about those details in the operation of the pipe lines? Mr. MiLBUEN. Mr. Payne can find out, Mr. Kellogg, anything you want to know. Witness. I will find out just what the process is. Mr. MiLBUEN. Anything you want to know, in any of these mat- ters. Mr. Kellogg. Please answer. Who would know the details of this? Witness. I think Mr. Trainor would know. Q. Mr. Trainor would know ? — A. That is, he would know whether he had accounts with all the pipe lines or not. Q. Is there no officer of your company who would know the de- tails of the transactions which I have asked you about? — A. I dont know of anything that I have not answered myself. Q. Is the oil the property of P. S. Trainor when it is delivered to you? — A. When it is delivered to us? Q. Yes. — A. As far as our books show, yes ; as far as we know. Q. When it is delivered by you to the refinery, is it the property of P. S. Trainor? — A. When it is delivered to the refinery? Q. Yes. — A. If delivered on P. S. Trainor's order. 352 PAYNE. Q. Your books do not show anything but Mr. Trainor's 719 name, then? — A. That is all; a credit to him and a charge to him as oil delivered. Q. That is all?— A. That is all. Q. That is true of all the pipe line companies ? — A. I think so, yes sir, that I am connected with; as far as I know. Q. What is Mr. Trainor's position ; AVhat position does he hold ? — A. I dont know what his title is. Q. Is he connected with the pipe line companies ? — A. No sir. Q. With the refining companies? — A. I dont know. Q. Where is his office ? — A. I see him at 26 Broadway. I dont know where his office is. I have never been in his office, even. Q. His name is the only one that appears on your books as trans- porter of oil? — A. Oh. I couldnt say that now. That is too broad a question. I dont keep the books, and I wouldnt want to say that there is no other shipper on the books. Q. Would Mr. Chesebro know about that? — A. I think the books at Oil City would show that; I dont know. Q, The books of the National Transit Company kept at Oil City? — A. Yes sir. Q. "VAIiere are the books of the Buckeye Pipe Line kept? — A. 720 Lima, Ohio, and Oil City; the general books are kept at Oil City. Q. The Eureka Pipe Line? — A. The Eureka Pipe Line is kept at Pittsburg. Q. The Indiana Pipe Line? — A. The general books are kept at Lima, and the field books at Montpelier. Q. Montpelier, Indiana? — A. Indiana, yes. Q. The Cumberland Pipe Line Company ? — A. The books are kept at Oil City ; the local accounts at Somerset, Kentucky. Q. The Southwestern Pipe Lines ? — A. At Pittsburg. Q. The New York Transit Company's books? — A. I think they are kept here. Q. In New York ? — A. I think they are kept in New York. Q. The Southern Pipe Line^ — A. I think they are kept here in New York. Q. I show you the schedule of tariffs filed, which shows all the tariffs filed by the pipe lines of the Standard Oil Company. I wish to know if any tariffs are filed to Toledo, Ohio. — A. I dont know. I think not. Q. Are there any refineries at Toledo ? — A. Yes sir. Q. Independent refineries? — A. Yes sir. Q. You have a pipe line at Toledo, havent you? — A. Yes. We deliver oil for the regular gathering charge there, twenty cents. Q. But you have no tariffs filed ? — A. I think not. It is within the state. 721 Q. Do your pipe lines connect with the Indiana fields? — A. No. It runs from the Ohio field to Toledo. Q. What company is it? — A. The Buckeye Pipe Line Company. PAYNE. 353 Q. But the Buckeye Pipe Lines are connected with the Indiana pipe lines ?— A. The Buckeye Pipe Line system is not connected into one system. Q. It is not? — A. No sir. Mr. EosENTHAL. Are the Toledo pipe lines in any way connected with the general Buckeye system ? Witness. I think not. Mr. KosENTHAL. It is entirely intrastate. Witness. It is a gathering system. Mr. EosENTHAL. That is entirely intrastate, isnt it ? Witness. Yes. Mr. EosENTHAL. Within the state? Witness. Entirely within the state, and a part of the gathering system, and no trunk line charge made at all. Q. The gathering system that delivers oil at Toledo does not con- nect with the trunk line at all ? — A. I think not. Q. You do not know whether it does or not? — A. Well, no more than any of the gathering systems do. Q. Dont all the gathering systems connect with the trunk line? — A. Certainly. Q. Then this gathering system connects with the trunk line, doesnt it? Mr. MiLBUEN. Not at Toledo. 722 Q. When you speak of connection, you have to have connec- tion with oil tanks? — A. The trunk line system takes it away from the tanks. Q. So that all gathering systems are connected with the trunk lines ? — A. They have to be. They cannot be any other way. Mr. EosENTHAL. Docs that trunk line that Mr. Kellogg speak of necessarily mean interstate or intrastate trunk line? Witness. It is all within the state. Mr. EosENTHAL. That is, the trunk line is all within the state ? Witness. The trunk line is all within the state. Mr. EosENTHAL. That trunk line running to Toledo does not con- nect with any trunk line running out of the state of Ohio, does it ? Witness. No. Q. The Buckeye trunk line is connected with the Indiana trunk line, isn't it? — A. They are connected by a station, yes. Q. Yes, but they are connected in the usual way ? — A. Yes sir. Q. And all your gathering lines of pipe line are connected with the trunk line? Mr. MiLBURN. Well, what are we at now? an Interstate Com- merce proceeding? Mr. Kellogg. Answer that question. A. All the gathering lines, yes sir. 723 Q. Yes sir. — A. They are all directly connected. The gathering lines deliver oil into tanks, and the trunk lines take it out from these tanks. You have to do it that way ; you can't do it any other. 32555—08 23 354 PAYNE. Q. Titusville; jou say you have no tariff filed for Titusville? — A. We have no tariff filed there. Q. Yes. — A. No, I think not. Q. Wliat? — A. No, we have no tariff filed there. Q. There are refineries there, are there not ? — A. Yes sir. Q. Independent refineries? — A. Yes sir. Q. You have a pipe line running to Titusville? — A. Yes sir, there is one line runs to Titusville. Mr. MiLBUEN. AVhat is that ? I didnt hear it. Witness. That is a gathering line. Q. Coraopolis : do you have a pipe line running there ? — A. Yes sir. Mr. MiLBUEN. Coraopolis? Mr. Kellogg. Yes sir. Mr. MiLBUEN. I never heard of that place. Witness. That is below Pittsburg, on the Ohio River. Q. There were independent refineries there? — A. Yes sir. Q. Warren, Pennsylvania: you have a pipe line there, ha vent you ? — A. Yes sir. Q. And there are independent refineries there ? — A. Yes sir. Q. And you have no tariffs filed there ? — A. No sir. 724 Q. Bradford, Pennsylvania? — A. Bradford? Q. Yes sir. — A. Yes sir. Q. There are independent refineries situated at Bradford ? — A. Yes sir. Q. You have a pipe line leading to Bradford, and you have no tariffs filed there? — A. I dont think there is any tariff filed. Q. Have you a tariff filed by any of the Standard companies to any independent refinery ? — A. Not filed, I dont think. Q. That is what I thought. — A. If you ask me if we have a tariff to these refineries, I can answer you better. Q. No, filed with the Interstate Commerce Commission. — A. No, not filed. We have a tariff to every one of these refineries and we are delivering to every one if them every day. Q. You are not delivering to all the independent refineries of the United States? — A. No sir. To those we are connected with. Q. Those you are connected with? — A. Yes. Q. You have filed no tariff's to those refineries? — A. We have not filed a tariff, but we have got a tariff, though. Q. Well, is there a single independent refiner in the United States today so situated that he could ship a barrel of oil under one of those tariffs that you have filed? — A. Oh, yes. 725 Q. Well, who? Where? — A. Oh, you are speaking about independents ? Q. Yes. Mr. MiLBUEN. And could ship a barrel of oil — a refiner? Mr. Kellogg. Yes. Mr. MiLBUEN. You dont carry any refined oil. Mr. Kellogg. Oh, I am not talking about refined oil at all. Witness. Crude oil. I am not familiar enough with those tariff- sheets to answer that question. PAYNE. 355 Q. Look them over. There is a list of them. (Handing list to witness.) — A. Is this it? Q. Yes sir. Mr. MiLBUKN. Look them all over minutely. A. (After looking over list.) I think these tariffs that give Phila- delphia as a terminal point could all be used by outside refiners, independents. Q. The ones to Philadelphia?— A. Yes. Q. None others? — A. None others that I know of along that line. Q. Now, let us see about Philadelphia. How many independent refineries are there at Philadelphia ?— A. The Sun Line Oil Com- pany (I dont know but it is called the Sun Oil Company) ; the Pure Oil Company; I think there is another one by the name of 726 Bossard & Wilson. I think the name has changed since. Q. The Pure Oil Company have their own pipe line, havent they? — A. Yes sir. Q. That is the United States pipe line? — A. Yes sir. Q. Bossard & Wilson are not refining now, are they? — A. I dont know. I think it is in some other name now. Q. Do you know where the Sun Oil gets its supply? — A. Do I know where they get their supply? Q. Yes. — A. I think they ship it by boat mostly. Q. From Texas? — A. From Texas. I think a refinery was built for that purpose. Q. Their refineries are not connected with your line, are they ? — ^A. I think not. It would be a very small matter to connect them if there was any demand for it. Q. Do you know Mr. James McDonald? — A. Who? Q. Mr. James McDonald, connected with any of the Standard companies? — A. I do not, no sir. Q. I show you a map which purports to show, in a general way, the location of the principal pipe lines, trunk lines, and the oil fields from which oil is procured. (Handing small map to witness.) — A. That gives, in a general way, the oil section, the oil country, and the lines crossing it. The map to which the witness refers was marked Petitioner's Exhibit 50. Q. In my last question I referred to Petitioner's Exhibit 727 50. Is that the map you refer to? — A. Yes. I said in a general way that gives the oilfields and lines crossing them. Mr. KELLOGG. I offer Petitioner's Exhibit 50 in evidence. Mr. MiLBTjEN. Well, you don't offer it as Mr. Ejellogg. As an exhibit, a map, yes. Mr. MiLBUEN. I mean you offer it as a general Mr. Kellogg. Yes. Mr. MiLBtTRN. You offer it for just what it shows it is? Mr. Kellogg. Certainly. 356 PAYNE. Q. It shows under shaded marks the general location of the va- rious oil fields in the various states ? — A. Yes. Mr. MiLBtJEN. But that is all. Witness. Generally. Q. And it shows the various leading trunk pipe lines? — A. It is quite incorrect on that. Some of those lines have been removed; they are not there now and have not been for some little time. Q. Will you please designate it so that we may know that is sub- stantially correct? — A. I call your attention to the Barbersville line; that is removed. Q. The Barbersville line ; you mean down in Kentucky ? — A. Yes, and in Tennessee. Q. And the part that runs over into Tennessee? — A. Yes. There may be others. Q. Otherwise, it is a fair representation of the general loca- 728 tion of the lines, is it not? — A. It is a general map showing the oil field and the lines crossing it. Mr. JVIiLBUEN. It also pretends to give the location of refineries. Do you want it for that purpose ? Mr. Kellogg. I was going to ask him about that, yes. Q. It pretends to give under black stars the location of towns con- taining Standard Oil Company refineries. Will you look and see whether it does? With your permission, I will point them out. Mr. MiLBUEN. Yes, if you would enumerate them, then we would know that you were not making a mistake. Mr. Kellogg. All right, he can enumerate them. Let the witness state in answer to my question whether the black stars indicate the location of Standard refineries. Mr. MiLBUEN. You call them off to him; you are more familiar with the map. Mr. Kellogg. All right. I will call them off. Q. Start from the west. Neodesha, Kansas. Mr. MiLBDRN. That is right. A. There is a refinery there. Q. Sugar Creek, Missouri. Mr. MiLBTJBN. That is right. A. There is a refinery there. Q. Whiting, Indiana. Mr. MiLBURN. I guess that is right. We will admit that. 729 A. There is a refinery there? Q. Lima, Ohio?— A. Yes. Q. Cleveland, Ohio?— A. Yes. Q. Franklin, Pennsylvania? — A. Yes. Q. Pittsburg, Pennsylvania? — A. Yes. Q. Parkersburg, West Virginia? — A. Yes. Q. Buffalo, New York?— A. Yes. Q. Olean, New York? — A. That is the Vacuum. I dont know whether the Standard Oil Company owns that 6r not: I could not tell you. PAYNE. 357 Mr. MiLBURN. The Vacuum; that is all right. Witness. Of my own knowledge, I did not know. Q. Baltimore, Maryland? — A. Yes. Q. Philadelphia, Pennsylvania? — A. Yes. Q. Bayonne, New Jersey?— A. Yes. Q. And Brooklyn, Long Island, New York? Mr. MiLBUEN. That is right. A. Yes, Brooklyn. Mr. MiLBTjfiN. How about the pipe lines? You have not said that this is a correct designation of the pipe lines. Witness. No, I said that was only a general map showmg about the location of the lines, the oil fields, and the lines crossing them. Mr. MiLBURN. Just a general view? Mr. Keijlogg. Yes. Mr. MiLBTTRN. That is all right. 730 Q. The line there marked red, Pure Oil Company's line, is not a Standard line? — A. No sir. Q. The pipe lines of the various companies connect with these re- fineries that you have named ?— A. Pipe lines do connect with them, yes sir. There are some lines that are not on the map. Mr. Kellogg. Your map will show it more in detail. I just wanted this for sort of a birdseye view. Mr. MiLBURN. Yes, a birdseye view. Now we have got it. You have struck the right word. Mr. Kellogg. The map in detail will show it more accurately. Mr. MiLBXjEN. Have you marked that? Mr. Kellogg. That is marked Exhibit 50. That is all, Mr. Payne. Mr. MiLBUEN. Certain requests were made of the witness. First, a statement showing the time the Manhattan lines were connected with the lines of the Buckeye Pipe Line Company, or the lines of any other company forming part of the Standard organization; and, second, to furnish a statement showing the quantity of oil delivered to the Buckeye Pipe Line Company or any other company as above, since and including 1900. Now, first, the Buckeye Pipe Line Company first received oil from the Manhattan Oil Company on December 18, 1899. Since that date receipts have been as follows : 731 Barrels. December 1899 43,879.23 1900 1, 394, 78L 09 1901 1,092,445.37 1902 908, 602. 03 1903 868, 934. 17 1904 873, 249. 38 1905 . 911, 654. 55 1906 1, 243, 804. 58 January 1 to August, inclusive, 1907 829,664.03 358 PAYNE. The first delivery from the Manhattan Oil Company to the In- diana Pipe Line Company was made February 2, 1900. Thereafter, the Indiana Pipe Line Company received oil from Manhattan Oil Company as follows : Barrels. 1900 536,100.34 1901 662,456.98 1902 700,404.06 1903 838,920.17 1904 857,480.35 1905 1,004,147.66 1906 890,388.75 1907, January to August, inclusive 389, 237. 84 He was asked to furnish the statements made to him each year, 1889 down to the present time, by the Corsicana Refining Company. I want Niunber 3. 732 Witness. Statement? Mr. MiLBTjEN. Yes. Witness. I could not find any of them in my desk this morning. They are sent to Oil City, and I thought I had brought some of them with me to New York, but I found none of them in my desk. Mr. Kelloog. Will you get them between now and next week? Witness. I will make further search for them. Mr. Kellogg. You can send to Oil City for them? Witness. If they are there, yes sir. Mr. MiLBUEN. You search for what you have, and produce them. Number 4 covers the map, and that you have. Those are the only lines that have received from the Manhattan? Witness. Yes sir, those are the only ones. Mr. MiLBUHN. The Buckeye and the Indiana ? Witness. The Buckeye and the Indiana. Examined by Mr. Kellogg : Q. Do you know in a general way that the Buckeye and Indiana are taking all of the oil of the Manhattan Oil Company? — A. I do not know whether they are taking all of it or not. Q. Is there any one in the immediate charge of your pipe lines that would know that? — A. No sir, I dont think there is any one that would know whether we get all of the oil of the Manhattan or not. 733 Q. Mr. Seep, the purchasing agent, or Mr. Trainor, would know, wouldnt he? — A. I dont laiow. He would know what he buys, that is all; we would know what we receive. Any of our agents or superintendents would loiow what we receive. Mr. Kellogg. That is all, for the present. Cross-examination by Mr. Milburn : Q. You have known of the pipe line situation and conditions for a great many years, have you not ? — A. Yes sir, somewhat. PAYNE. 359 Q. The pipe lines of the country have been made and built for the purpose of transporting crude oil from the oil fields to refineries? — A. Yes sir. Q. Will you describe briefly such a pipe line, and of what it con- sists? — A. A pipe line consists of branch connections to producers' tanks. Q. Those you call gathering lines? — A. Those are gathering lines. Those lines are like a cobweb, they come in all directions, crossing one another, perhaps, but they come to a central locality within that field, that particular district, although there might be several central locali- ties if the producing district was very large. The oil is gauged in the producer's tank. The first measurement is taken in the tank, 734 and the bottom measurement, the last measurement, and the oil is run out. Q. I dont care so much about that, Mr. Payne, as I do for the physical system. — A. From these central points in the field (there may be one or more in the field) the oil is then conveyed Q,. In the central field are there storage tanks where the oil is col- lected from the gathering lines ? — A. Well, tliere might be, and there is in some fields, and in others there is only a small amount of tank- age. It would depend upon the size of the field. If it is a very large field, the storage tajiks are built in large numbers, a regular system of them ; it depends upon the size of the field. The oil is conveyed from these several central locations to one of these tank farms, or tank cities, I might call it, to the larger collection of tanks. Those are principally located on the trunk lines ; those large amounts of tank- age are located on the trunk lines, principally. Then the oil is taken from those fields, as demand is made for it, through the trunk pipe lines, to the destination where the shipper orders it taken, where he wants it delivered. Q. How is it transported? What I want to get at is, are there pumping stations from point to point ? — A. Yes sir, there are pump- ing stations in size in proportion to the amount of oil that is to be handled. Those stations receive oil from tanks, either large or small, that are located adjacent to them, and put up under a pressure 73.5 of anywhere from 400 to 900 pounds to the square inch, and that oil is conveyed then to the next station, maybe 40 miles away, maybe 45 or 60 miles away. Q. And then when it reaches the station, what is done? — A. When the oil reaches that station it goes into iron tanks located at that station. A correct gauge is taken at the station and checked back with the station before it. to see that he is getting all the oil that is coming from the station back. Q. It is pumped from there?— A. Then the pump takes it from that station and pumps it 40 or 50 miles, as the case may be, to an- other station. It goes into an iron tank or more iron tanks there, and then is taken by the pump, by section lines, from these tanks and put under the pressure- again, and conveyed another 40 or 60 360 PAYNE. miles, and so on to its destination. The stations vary according to the topography of the country. Q. Did you ever know of a pipe line being built excepting to con- nect particular refineries with the oil fields ? — A. I never knew a pipe line to be built that was not built to take care of the owner's own production, or to convey all to the refinery that the investor in the pipe line owned; either for one purpose or the other, or sometimes both; taking his own oil from his own well and conveying it to his own refiinery. Q. And were all these so-called Standard pipe lines built T36 to take oil from the oil regions to so-called Standard refiner- ies? — A. That is what they were built for in the first place; all pipe lines are built for that purpose. Q. This trunk line that you have described, running from station to station, is a pipe of about what size ? — A. Well, they vary according to the quantity of oil. Q. Between what dimensions? — A. Between the dimensions of three inches up to twelve inches. Q. And that pipe is in a fixed position? — A. Yes sir. There may be several lines of pipe alongside of one another. As the field grows in production, we add pipe lines to it. Q. You increase the trunk lines? — A. Increase the trunk lines, to get rid of it. Q. But each trunk line is in a fixed position? — A. Yes sir. Q. You know, Mr. Payne, that in some of the states those pipe lines are what is called purely private lines ; that is, the company has bought the right-of-way and built the line, and uses it for its own business? — A. There are quite a number of private lines owned by independent refineries, as well as the Standard. Q. And you know that in some of the states some of the pipe lines are built under a law with reference to public pipe lines; that is, they are public lines? — A. Yes sir. Q. Pennsylvania has such? — A. That is one of them. 737 Q. That is one of those states, is it not? — A. Yes sir. Q. Ohio, I believe, is it not? — A. Yes sir. Q,. Indiana? — A. Yes sir. Q. A line, therefore, runnin,y; through various of such states from the oil fields to the refining point is apt to consist of lines organized for each of those states ? — A. I think they do, altogether. Q. You know that the Indiana pipe line, the line running through Ii.diana, is the line of that company? — A. Yes. Q. And the pipe lines in Ohio are owned by public 2>ipe line com- panies? — A. Yes. Q,. And it is so in Pennsylvania? — A. Yes sir. Q. And in other places, in other states, I say, pipe lines are built by private persons for their own purposes, on their own right-of- way, and are not engaged in any public business. — A. Yes sir, and some of them are built within the states you have named, too ; inde- pendents. PAYNE. 361 Q. Yes, they are purely private affairs? — A. They are purely pri- vate affairs, and conducted that way. Q. Prior to 1906 (take that year) , to your knowledge, were all of the pipe lines of the so-called Standard system pipe lines running from oil fields to Standard refineries? — A. Yes sir. Q. Built and used for that purpose? — A. Yes sir. Q. Where there is such a pipe line is there any difficulty in locating refineries along it and it being used for the supply of such re- fineries? — A. No sir; there is no difficulty. 738 Q. So, you take a pipe line running through the State of Ohio or running through the State of Pennsylvania, or run- ning through the State of New York, if a refinery was built along its line there would be no difficulty in making the connection to get a supply of oil for that pipe? — A. Not if they had the money to pay for the oil, if they had the money to buy it. Q. Yes, if they had the money to pay for the oil, and the money to build the refinery? — A. Yes sir. Q. You know in a general way that sometime in the middle of 1906, July or August, 1906, that there was a change in the Interstate Commerce act, whereby public pipe lines were brought under? — A. Yes. Q. You know that in a general way ? — A. I know that. Q. Do you know, Mr. Payne, that at that time the Standard Oil Company — and for some time prior to that — owned, as a private line, the pipe line running to its refineries in New Jersey? — A. Yes sir. Q. Its own lines? — A. I suppose it was its own line. I never looked into their accounts, nor do I know anything about their accounts. Q. That is your understanding? — A. I know the National Transit Company sold two lines to them in 18!)5. Q. In 1895 ?— A. Yes sir. Q. Are you referring to those lines? — A. Yes sir, I am referring to those lines. Q. In New Jersey? — A. Yes sir. 739 Q. I am talking about in New Jersey. Prior to 1906 (I will fix the beginning of that year) did you know, as you know a great many other things connected with the company, that the Standard Oil Company of New Jersey owned as private lines the pipe lines in New Jersey running to its refineries? — A. Yes sir. Q. And that line began at the State line of New Jersey?— A. Yes sir. Q. Between New Jersey, say, and New York?— A. Yes. Q. That would be at this place called Union ville, would it not? — A. One of them. Q. Yes; I will take Unionville to begin with. Now, running to Unionville at that time, say the 1st of January, 1906, or say the 1st of June, 1906, was the pipe line running through New York, or a portion of New York, to Unionville, of the New York Transit Company? — A. Yes sir, it was. 362 PAYNE. Q. That was a public pipe line company, was it not? — A. I think not. Q. You think the New York Transit is not? — A. No sir, I dont think it is. Q. What? — A. I dont think it is public. Q. Well, it had a line A. They didnt file any tariff on that line; they concurred in a through rate to Unionville. Q. Well, it does not make any difference whether it was a public company or not, for the purposes of mv inquiry. It joined in that tariff?— A. Sir. Q. The New York Transit joined in the tariffs? — A. Yes sir, con- curred in the through tariff. 740 Q. The line stopped at Unionville? — A. Yes sir. Q. At the Jersey line? — A. That is as far as it owned any pipe line. Q. That is as far as it could transport oil ? — A. Yes sir. Q. And it could not transport oil beyond that unless it owned a line beyond that, or some company owning a line beyond that joined with it? — A. No sir, it could not. Q. Take when that law went into effect. If the Standard Oil Company of New Jersey would not take any but its own oil into its private line, at the Jersey line, and the New York Transit Com- pany was under obligation to transport oil to its terminus, then it would be necessary for it to build a terminal station there, would it not?— A. The New York Transit? Q. Yes. — A. Yes sir, it would have to build a station there. Q. It would have to build a station there. Mr. Kellogg. Where is that? I didnt catch that? Mr. MiLBURN. At Unionville. Q. That was where its line stopped ? — A. Yes sir. Q. Between New York and New Jersey, and that is where its line had been for years, had it not? — A. For some years. Q. For some years? — A. Yes sir. Q. It was not laid to Unionville when the Interstate Commerce act was passed, was it? — A. Not laid to Unionville; it was there before. Q. It was an existing fact A. Yes. Q. When that act was amended in 1906 and went into 741 effect, and had been for years before that time? — A. Yes sir. Q. And if the line to the east of that, through New Jersey, was a private line, owned by a private individual, then the New York Transit Company, to fulfill its obligation to transport for anybody who might tender oil to it, would have to have a terminal station at Unionville? — A. Would have to have a delivery point there. Q. And it proceeded to build one? — A. Yes sir. Q. At that point? — A. Yes sir. Q. As a result of that law, to fulfill its obligation, did it not? — A. Made a delivery point there and built the tank to receive oil in. PAYNE. 363 Q. So that anybody on that route, on the route of that line, can have oil transported by that line, and delivered at the end of the New York Transit's line? — A. Yes sir. Q. And if anybody wants to build a refinery there, he can build it and get oil? — A. Yes sir. Q. Just as he can at any other point^ A. Yes sir. Q. Along that entire line, from its beginning to its end? — A. Yes sir. Q. That is so?— A. Yes. A recess was here taken until 2 :16 o'clock P. M. 742 Afternoon Session. Thursday, September 26, 1907. Calvin N. Payne, recalled as a witness on behalf of Petitioner, testified as follows: Cross-examination (resumed) by Mr. Milburn : Q. Mr. Payne, I have probably misused expressions, and I want to have the correct phraseology. Take a place like Unionville, terminus of a pipe line like the New York Transit Company. Now, there it has receiving tanks, has it not? — A. Yes sir. Q. At such a terminus? — A. It has receiving tanks. Q. Those it provides ? — A. Yes sir, it provides receiving tanks. Q. And do you call that a receiving or delivery station? — A. Yes sir, receiving and delivery station. Q. Receiving and delivery station? — A. Yes sir. Q. And that is comprised of the tanks into which the oil trans- ported by the company runs for delivery? — A. Yes sir. Q. If it has no pipe lines beyond that and a refinery has a private pipe line to get the oil which is delivered into those receiving tanks, then it builds a pumping station? — A. Yes. Q. Is that correct ? — A. The pipe line doesnt build the pump- 743 ing station; the party receiving the oil builds the station. Q. Listen to what I said. If a refinery has, beyond that point, a pipe line running to its own refinery, then, to get the oil from the receiving station of the pipe line company it builds a pumping station? — A. Yes sir. Q. To pump it from the receiving tanks to its refinery? — A. Yes sir. Q. Through its own pipe line ? — A. Yes sir. Q. And that you call a pumping station. — A. Yes sir. Q. And the pumping station would be provided in that case by the refiner? — A. Yes sir. Q. So if there was another refinery built in New Jersey which built a private pipe line to your receiving tanks at Unionville, then it would build a pumping station to pump the oil delivered into your receiving tanks, to its refinery ? — A. It would have to build its own station. 364 PAYNE. Q. And as you understand it, the New York Transit Company built its receiving and delivery tanks at Unionville, and the Stand- ard Oil Company of New Jersey built its piunping station to pump the oil — its oil — from those receiving tanks through its own pipe line to its own refineries? — ^A. Yes sir. Q. That is the correct situation? — ^A. Yes sir. Q. I think either you didnt understand me, or you fell into an error about the New York Transit Company. At any rate, you now understand that is organized under the Pipe Line Act, and is a 744 common carrier, do you not? — A. Yes sir, I so understand it. Q. And its lines run from where to where? — ^A. Its line runs from the state line of Pennsylvania to Buffalo and to Union- ville and to Olean. Q. And to Olean? — A. Yes sir. Q. Buffalo is a refining centre? — A. Yes sir. Q. And the Standard Oil Company or one of its associated com- panies has a refinery there? — A. Yes sir, the Atlas Eefining Company. Q. And there is a refinery of an associated Standard company at Olean? — A. Yes sir. Q. And those lines were built from the Pennsylvania state line through New York for the accommodation of those refineries? — A. Yes sir. Q. At the New Jersey state line its line stopped and always has stopped, since that line was built, at Unionville — its own line? — ^A. Yes sir, stopped at Unionville. Q. It is not a gathering company in any sense? There is no oil traffic originates on its road, is there? — A. On the New York Transit? Q. Yes. — A. A very trifling amount, near Olean. Q. Near Olean? — A. Yes. Q. But none that comes from outside of the state? — A. No. Q. Whatever oil does originate, of its own line, you say is a small quantity at Olean? — A. In the vicinity of Olean. 745 Q. And I suppose is used in the Olean refinery, is it? — A. Yes sir. Q. But apart from that, it originates no oil traffic? — A. No sir. Q. And only takes what is delivered to it at the Pennsylvania line? — A. Yes sir. Q. And the line which delivers to it at the Pennsylvania line is what, — the company is what ? — A. National Transit Company. Q. That is the National Transit Company ? — A. Yes sir. Q. And that you understand is a Pennsylvania corporation owning some of the lines in Pennsylvania? — A. Yes sir. There is another line that delivers to it, too ; that is the Northern Pipe Line. Q. The Northern Pipe Line? — A. Yes sir. Q. But the National Transit Company you understand is a Penn- sylvania corporation? — A. Yes sir. Q. Owning certain pipe lines in Pennsylvania ? — A. Yes sir. Q. And are common carriers? — A. Yes sir. PAYNE. 365 Q. What is the Northern?— A. Sir? Q. Is the Northern also a Pennsylvania corporation ? — A. Yes sir. Q. Is it a common carrier? — A. Yes sir. Q. And it connects at the Pennsylvania state line with the New York Transit Company lines? — A. Yes sir. Q. I believe you said, in answering as to the date (I may be wrong in my memory, but I think I am right) , that the New 746 Jersey company acquired the line in New Jersey from Union- ville in 1895?— A. Yes sir. Q. November, 1895?— A. Yes sir. Q. That is 1905— which is it?— A. 1905. Q. Is the correct date?— A. Yes sir, 1905. If I stated 1895, I should have said 1905. Mr. Kellogg. He did not state that. I couldnt understand it. Q. My recollection is that you said 1895. — A. I should have said 1905. Q. Is the situation practically the same at Centerbridge ? Is that a terminus of the Transit Company? — ^A. Yes sir. Q. Which transit company? — A. The National Transit Company. Q. The National Transit Company. — A. Yes sir. Q. Centerbridge is on the line between -A. Pennsylvania and New Jersey. Q. Between Pennsylvania and New Jersey? — A. Yes sir. Q. And the National Transit Company's own line has always ended at Centerbridge? That has been the terminus of its own line? — ^A. Yes sir. Q. And did the same situation arise there when, being a common carrier, it had to file its tariffs, that the obligation was then upon it to carry oil for anybody to the terminus of its line ? That is so ? — ^A. That is the terminus of its line. Q. So the obligation was upon it, and anybody might have tendered it oil to carry it to the terminus of its line at Centerbridge ? — ^A. Yes sir. 747 Q. And to be able to fulfill that obligation, you required re- ceiving tanks there ? — A. Yes sir. Q. And as you understand, it built receiving tanks there, and at or about the time the amendment to the Interstate Commerce Act went into effect? — A. Yes sir, it did build tanks. Q. It had no line beyond that ? — A. No sir. Q. The line beyond that is a private pipe line owned by the Standard Oil Company of New Jersey for its own business?— A. Yes sir. Q. If you could have been assured that nobody would ever tender oil to you for carriage to the terminus of your line, you need not have built receiving tanks there ? — ^A. No sir. Q. But being built there, you put yourself in a position to fulfill your legal obligation to carry anybody else's oil to the end of your line ? — A. Yes sir. 366 PAYNE. Q. The pumping station there, again, is the pumping station of the New Jersey Oil Company?— A. Of the Standard Oil Company of New Jersey. Q. Of the Standard Oil Company of New Jersey ? — A. Yes sir. Q. And if anj^body else built a refinery at that point or in that vicinity or in New Jersey, and built a line to your receiving station, it could build a pumping station and get its oil in that way? — A. Yes sir. Q. So that anybody can establish a refinery there in that 748 vicinity or in New Jersey, and reach the receiving station at Centerbridge, just as the Standard Oil Company of New Jersey does with its line? — A. Yes sir. Q. The same is ti-ue, is it not, of Fawn Grove? That is on the state line between Pennsylvania and Maryland? — A. Yes sir. Q. And what line is it of which it is the terminus? — A. The Na- tional Transit Company. Q. Again the National Transit Company. And that is where t'le line owned by it as a Pennsylvania corporation has always stopped ? — A. Yes sir. Q. And when the law went into effect there, again you had to provide your receiving tanks to take any oil that might be delivered to you to be carried o\'er your line to its terminus? — A. Yes. Q. The line in Maryland is the private line of what company? — A. The Standard Oil Company of New Jersey. Q. Of the Standard Oil Company of New Jersey, reaching its refinery? — A. Yes sir. Q. And again at that point anybody could have a refinery, just as it has, and reach your receiving station at the New Jersey line by its own pipe line as the New Jersey company does ? — A. Yes sir. Q. That is true? — A. Yes sir. Q. So that (I want to have this clear, Mr. Payne), from 749 the time years ago when these lines were built, whenever it was, the New York Transit's line to the New Jersey line, the National Transit's line to the New Jersey line, and the National Transit's line to the Maryland line, the first ended and always has at Unionville, the second ended and always has at Centerbridge? — A. No, Mr. Milbum. Q. Eh? — A. No, I was going to ask you to correct my statement on that. Q. Well, let me finish; and the third has at Fawn Grove? — A. Yes sir, Fawn Grove. Q. Now, where am I in error ? — A. You are wrong in " always been." Q. Well, since that line was built, its own line, I am speaking about. — A. It sold its line in New Jersey in 1905. Q. Its line in New Jersey I am talking about. — A. Yes sir. Q. And its line in New York the first? — A. Yes. Q. Its line in New York always stopped at Unionville? — A. Yes sir, always stopped at Unionville. PAYNE. 367 Q. That is so? — A. Yes, right across the state line. Q. And its line in Pennsylvania stopped at Centerbridge? — A. Not always, Mr. Milburn. Q. Well, that line? — A. Part of that line was sold in New Jersey in November Q. I am not talking about the line in New Jersey, I am talking of its line in Pennsylvania stopping at Centerbridge. — A. It 750 stopped at Centerbridge, and in Unionville. Q. And its line in Pennsylvania stopped at Fawn Grove on the border between Pennsylvania and Maryland? — A. Yes sir, Mr. IvELLOGG. We concede that after they got over the line, it would not be in Pennsylvania. Mr. ]MiLBUEN. Oh, well, its ownership of its line there was very different from its ownership of its line beyond New Jersey. Q. Mr. Payne, do you know whether the New York Transit Com- pany was ever organized in any way under the laws of New Jersey ? — A. I dont know ; I dont think so. Q. You do know that the line, even if it owned it, in New Jersey, was a line acquired on a private right-of-way? — A. Yes sir, it bought its right-of-way. Q. And so with the line in New Jersey beyond Centerbridge? — ^A. Yes sir. Q. And so with the line beyond Fawn Grove? — A. Yes sir. Q. And you never heard of the National Transit Company, which is a Pennsylvania corporation, having organized in either New Jersey or Maryland? — A. I think not; I dont know of any organi- zation. Q. I think you have said that anywhere — anywhere — on the pipe line of any of those companies, at any point, refineries could be con- structed and built and get their supply of crude oil through a con- nection with the lines of these companies ? — A. Yes sir. 751 Q. The terminus of one line is Marcus Hook. Where is Mar- cus Hook? — A. It is on the Schuylkill Eiver, I think, below Philadelphia. Q. What line is that that terminates there? — A. That is the National Transit Company. Q. And there are receiving tanks there? — A. Yes sir. Q. Now, where is the refinery of the Standard Oil? — A. I think it is at Point Breeze. Q. Is that across the A. It is along the docks there. Q. Is that across the bay? — A. I dont know as it is across the bay; I think it is, on the other side of the river. Q. How is the oil gotten from Marcus Hook to the refinery, do you know? — A. I think it is by their own line. Q. Is it by barges or pipe, or how?— A. Some of it by barges, yes sir. Q. Is there a line beyond that that it has to its refinery, or how is that? — A. I dont know whether there is a line across the river or not. 368 PAYNE. Q. Well, that is the seaboard point — Marcus Hook, is it not? — A. Yes sir. Q. Where does that line that terminates at Marcus Hook run back to? Where does it begin, where does it come from? — A. The Na- tional Transit? Q. Yes; what oil fields? — A. It connects with — I think nearly all the oil fields of Pennsylvania are tributary to it. Q. To that? — A. It is a part of the National Transit Penn- 752 sylvania System. Q. And is Marcus Hook in Pennsylvania ? — A. I think it is in Delaware ; I dont know whether it is in Delaware or Pennsylvania. I think it is in Pennsylvania. Q. In Pennsylvania? — A. I think so. Q. Well, all the oil from that field is available to people for de- livery at Marcus Hook, is it not? — A. Pennsylvania field? Q. Yes sir. — A. Yes, sir, the greater part of it is. Q. And they can get it from Marcus Hook to any refineries in that vicinity, in the same way that the Standard Oil Company of New Jersey does to its refinery? — A. Yes sir. Q. That is the seaboard points — Marcus Hook? — A. Yes sir. Q. You were asked about Toledo. — A. Yes sir. Q. Is Toledo on a trunk line or on a gathering system? — ^A. A gathering system. Q. And that is a gathering system from the Oil fields in Ohio? — A. Yes, sir, the northern oil fields of Ohio. Q. The northern oil fields of Ohio? — A. Yes sir. Q. So that that oil originates in Ohio and is delivered at Toledo in Ohio? — A. Yes sir. Q. That is intrastate trade? — Yes sir. Q. You dont understand that any tariff has to be filed with the Interstate Commerce Commission with respect to intrastate trade? — A. I never understood that they had to be filed. Q. And the refiners at Toledo (so-called independent re- 768 finers) have the same access to that oil field through that gath- ering system that the Standard refineries have? — A. Yes sir. Q. Does the same situation exist at Titusville? — A. Yes sir. Q. Is it on a gathering system? — A. Yes sir. Q. Not on a trunk line? — A. No sir. Q. And do the so-called independent refiners there have the same access to the Pennsylvania oil fields through that gathering system that the Standard refineries have? — A. Yes sir, they have. Q. And that is purely intrastate, is it not? — A. Yes sir. Q. So with Coaopolis — is that it? — A. Coraopolis? Q. Coraopolis. Where is Coraopolis? — A. It is a few miles below Pittsburg. Q. It is an addition to my geogi'aphical lore. Where is it ? — A. A few miles below Pittsburg, on the Ohio river. Q. It is on a gathering system? — A. Yes sir. PAYNE. 369 Q. A gathering sj'stem which reaches the oil fields of Pennsyl- vania? — A. Yes sir. Q. And the independent refiners there have the same access to and use of, if they wish, of that gathering system that the Standard refinery has? — A. Yes sir. Q. Warren — is it also on a gathering system? — A. Yes sir. Q. Not on a trunk line? — A. Xo sir. Q. And the independent refineis there have the same access to and use of that gathering system thai the Standard refineries 754 have? — Yes sir. Q. And do the independent refineries at those points get their oil through that gathering system? — A. Yes sir. Q. Their oil or some portion of it? — A. Yes sir. Q. And Bradford, is it on a gathering system? — A. Yes sir. Q. Not on a trunk line? — A. Xo; it is a little nearer the trunk line than some other points, but not Q. But it is on the gathering sj^stem ? — A. It is on the gathering system. Q. And the independent refiners have the same access to it for the oil which the gathering system reaches that the Standard refineries do? — A. Yes sir. Q. And they get oil from that systein? — A. Well, I dont know whether — they have got their lines — I dont think they are asking for any oil. Q. At Bradford?— A. Yes sir. Q. Is there any other pipe line there? — A. Yes sir. Q. What concern is that? — A. That is the Lewis Emery, Jr., Pipe line. Q. Is that its name? — A. Emery Pipe Line, I believe it is called. Q. And that is a pipe line that runs through that region to the Pennsylvania fields? — A. It is a gathering system. Q. It is a gathering system? — A. Yes sir. Q. Just like yours? — A. Yes sir. Q. That is an independent — so-called independent? — 755 A. Yes sir. Q. At Warren is there any other pipe line? — A. Several of them. Q. Apart from the Standard's?— A. Yes sir. Q. And there are gathering systems? — A. Yes sir. Q. "WTiat are they? — A. John Ellis & Company, Cornplanter Ee- fining Company; Muir Oil Company is another. Q. They have gathering systems? — A. Yes sir: they gather oil the same as the National Trainsit do. Q. The same as they do ?— A. Y es sir. Q. Any other at Coraopolis? — A. Yes sir. Q. What is there there?— A. John Ellis & Company have a line there (gathering line), and a trunk line, I think, connecting with 32555—08 24 370 PAYNE. Warren and Coraopolis from Pittsburg through to Warren. It is a gathering system, though, nearly all the way. Q. And Titusville, is there any other there ? — A. Any other line ? Q. Yes. — A. The Pure Oil Company has a line there. Q. Are there independent gathering lines, or lines in the Ohio oil fields reaching ^'arious points where there are so-called independent refineries? — A. Yes sir, there are a number of them. Q. What are they? — A. One is the Paragon Refining Company; one is the Sun liine Oil Company; one is the National Refining Company. 756 Q. And what other points do they reach? — A. Another one I didnt name; the Manhattan Oil Companj' gather a large amount of oil. Q. And what points do they reach? — A. They reach Toledo and Lima and Findlay, and North Baltimore, and Welker. They reach other points that I cant name now. Re-direct examination by Mr, IvEiiLOGo: Q. Mr. Payne, you corrected your testimony, I noticed. You made an error, I believe you say, and you now say that the New York Transit sold its line in New Jersey to the Standard Oil Company of New Jersey, in November, 1905, instead of November, 1895. — A. Yes sir, it was just a mis-statement of the figures, that is all; instead of 1895, it should be 1905. Q. I thought at the time there was an error. — A. I did say 1895. I should have said 1905. Q. Previoxis to November, 1905, the line of the New York Transit Company extended across the State of New Jersey to Bayonne, New Jersey? — A. They had a line, I think, across there. Q. And operated it? — A. Yes sir. Q. And the same line extended across the Hudson and across the East River to Long Island? — A. I dont think so. Q. You think that belonged to some other company? — A. Yes sir, I think so. Q. Well, the line extended, anyhow, from Unionville across 757 the state of New Jersey to Bayonne ? — A. I think so, yes. Q. Prior to November, 1905? — A. Yes, and they extended at least to their large tank fields in New Jersey. Q. Well, near Bayonne? — A. I dont know exactly. Q. And the line of the National Transit extended from the state line also to Bayonne; from the state line near Centerbridge ? — A. I cant tell you exactly the terminus of that National Transit line that went across New Jersey. I explained to you that I didnt have charge of the trunk lines until within a few months, that I had any connection with them. Q. Well, what is your understanding as to about where it ended? Mr. MiLBURN. Near Bayonne. Witness. Somewhere near New York Harbor. I think they boated the oil from the terminal of that line to their refinery. PAYNE. 371 Q. Now, you say those lines were constructed in New Jersey on private right-of-waj' ? — A. Yes sir. Q. you were familiar with the time they were constructed? — A. Well, not very. Q. Generally speaking. About when was the line completed? — A. The National Transit Company tried to buy its own right-of- way everywhere. They failed sometimes in the state of Pennsyl- vania. Q. There is no condemnation law, you understand, in New 758 Jersey?— A. I should judge so. Q. And you say that any refinery on the New York Har- bor might build a pipe line to connect with your delivery station at Centerbridge or Unionville? — A. Yes sir. Q. That is, if they could get across the State of New Jersey ?— A. Yes sir. Mr. MiLBTjKN. It is a little State. Mr. Kellogg. Yes, but it is big when it comes to building a pipe line across it. Mr. Rosenthal. We dont own it. , Mr. Kellogg. I think you do. Mr. MiLBUEN. Well, it is not in our lists that we furnished you, anyhow. Q. Now, Mr. Payne, you remember the United States Pipe Line construction, dont you, about the time that was constructed? — A. I remember their building a line, yes sir. Q. You remember their trying to get across the State of New Jersey, dont you ? — A. Why, I read something about it in the papers. Q. There was a good deal said about it, wasnt there? — A. There was a good deal said about it in the papers. Q. They finally, after a good many law suits, failed and had to abandon the project, didnt they? — A. Why, they did put a line through to the seaboard. Q. To New York Harbor? — A. I dont think they went to New York Harbor, no. 759 Q. They undertook to come to New York Harbor, didnt they? — A. So the newspapers stated. Mr. MiLBUEN. Never mind what the newspapers stated. Tell us what you know. Witness. I dont know. Q. Well, that is probably accurate. Mr. MiLBTjRN. You pander to the press by saying it is always accurate. Q. You had some general knowledge of the pipe line situation at that time, didnt you?— A. I knew they were building a line, yes sir. Q. And had quite a keen interest in the subject?— A. Well, the interest that I would have in any line building. Q. And it was being built as a rival line to the Standard's line, wasnt it? — A. I think it was built in competition to them. 372 PAYNE. Q. And you remember, clont you, very well that they had a good deal of litigation and finally failed to get across the State of New Jersey? — A. I believe they did, yes sir. Q. So it. isnt such a simple matter, then, to build a line across the State of New Jersey, is it? Mr. Rosenthal. That is 30 years ago. Mr. KJELLOGG. Oh, no. Witness. I think they did build some lines in New Jersey. Q. Now, the Tidewater Company had a great deal of trouble to get their line across the State, too, didnt they? — ^A. I dont know; that was before my pipe line days. 760 Q. All right. Mr. MiLBUEN. You are not old enough to reach back to that time, eh? Q. "^^Tiy did the New York Transit Company sell its lines in the State of New Jersey in November, 1905? — A. I dont know. Q. You dont loiow anytliing about that ?— A. No. Q. It had operated that line for many years, and owned it, hadnt it ? — A. I think it had, yes sir. Q. And it had no station at Unionville? — A. I dont think it had. Q. What?— A. I dont think it had. Q. And prior to 1906 it never had any occasion for a station at Unionville, did it? — A. No, I think not. Q. What?— A. I think not, prior to 1905. Q. Prior to 1905?— A. Yes sir. Q. Well, it didnt build a station immediately after selling the line, did it ? — A- I think not. It didnt build a station at all. Q. Well, there was no station built there immediately after sellirig the line?— A. No. Q. The station was not built until in the summer of 1906 or autumn, was it? — ^A. Some time in 1906 while I was away. Q. It operated its own line in connection with the line across Jersey from 1905 until that station was built, without any difficulty, didnt it? — A. Previous to that time? Q. Yes. — A. Previous to the station being built? 761 Q. Yes. — A. Yes sir. Q. And it had operated its line across the State of New Jer- sey for many years without any piunping station or delivering sta- tion at Unionville? — A. Yes sir. Q. ^Vnd the same is true of the lines at Centerbridge ? — A. Yes sir. Q. And the same is true of the lines at Fawn Grove? — A. The lines at Fawn Grove, yes sir, the same. Q. Now, you say that it was necessary to build a delivery station at the terminus of its line at Unionville, New York, was it? — A. Yes sir. Q. Because that was the terminus of its line? — A. I was advised by the attorneys to build that delivery station. Q. Oh, you weic advised by the attorneys to do that? Well, that was to PAYNE. 373 Mr. MiLBUKN. Finish. That was to comply with the law. Mr. Kellogg. Or evade it. Mr. MiLBUEiiT. No, to comply with it. Q. Now, Mr. Payne, at the Junction of the lines of the New York Transit Company and the Northern Pipe Line and the National Transit on the borders of the State of New York south of Glean, you have no delivery station, have you ? — A. No, there is no delivery sta- tion there. Q. And no pumping station ? — A. No. Q. Near the border or at the border of the line between Pennsyl- vania and Ohio where the Buckeye Pipe Line Company 762 connects with the National Transit's lines, and your other lines in Pennsylvania, you have no delivery stations, have you ? — A. Yes, there is a delivery station at both of those points. Q. At both of those points ? — ^A. Yes sir. Q. Well, let us see. MTiere is the delivery station on the border between the State of Ohio and Pennsylvania ? — A. There is one near Sharon or Mantua. Q. Now, Mantua is 30 or 40 miles west of the State line and on the line of the Buckeye Pipe Line Company? — A. I dont know how far west it is. Q. Well, it is a long ways west, isnt it ? — A. You say so. Q. Well, dont you know it is? — A. I have no knowledge of how far it is. Q. Well, it is quite a ways west of the Pennsylvania State line. — A. I dont think it is very far west. Q. And it is not at the place of junction between the Buckeye Pipe Line and the Pennsylvania line ? — A. There is no pumping station at that point. Q. No. Then there is no delivery station on the line at the place of junction between the Buckeye Pipe Lines and the Pennsylvania lines, is there ? — A. I think not. Q. Well, that is what T asked you. — A. I think not. Q. Now go west: take the line between Indiana and Ohio where the Buckeye Pipe Line Company connects with the Indiana 763 Pipe Line; is there any delivery station at that point? — A. There is a delivery station very close to the State line. Q. How far? — A. I dont know exactly how far Adgate is from the Ohio State line. Q. Adgate?— A. Yes. Q. Adgate isnt on the line, is it? — A. Yes sir. Q. Right on the line between the A. Oh, the State line, you mean? Q. Yes. — A. I thought you meant the pipe line. I don't know how far it is. Q. And Adgate is not the place where the Buckeye Pipe Line and the Indiana line join, is it? — A. No sir, that isnt where they join. They join at the State line. 374 PAYNE. Q. You have no delivery station at the place of junction between the Indiana Pipe Line Company and the Buckeye Pipe Line, have you? — A. No sir. Q. Then, the only place it was necessary for you to build a delivery station at the junction between two lines was at Unionville, New York, at Centerbridge, Pennsylvania, and at Fawn Grove, Pennsylvania ; is that not true ? — A. No sir, that is not true. Q. Well, where is there another one ? — A. In the southern part of Ohio, between Virginia and Ohio. Q. Between Virginia and Ohio? — A. Yes sir. Q. At the point of junction? — A. Yes sir. 764 Q. Between the Buckeye Pipe Line A. On the Ohio River. Q. On the Ohio River? — A. On the border between the two states. Q. When was that built? — A. Built the same time, in 1906. Q. Oh, well, I havent found that out, I am glad you mentioned it. — ^A. Well, you asked it, and I tell you what you ask. Q. Now, let us see about that. Wliat is the name of that place ? — A. I think there are several places there: I dont believe I can give you the name of them. They are all small. They are in the gather- ing lines system. Q. In the gathering line system? — A. Yes, they are not trunk lines. Q. That is a concentrating place where the gathering lines con- nect with the trunk lines? — A. No, the trunk lines are not there on either side of the river. Q. The ti'unk lines connect at a concentrating place there? — A. The Ohio River divides the oil field, and it divides the State also. The Ohio corporations could not do business in Virginia, nor the Virginia do business in Ohio. Consequently there was a Separa- tion made there. There are no trunk lines crossing the river there. Q. Prior to 1906 3'ou pumped right across the river, did you? — A. The Buckeye Pipe Line? Q. Yes. — A. Yes, they delivered at the river to the Eureka Pipe Line. Q. Without any pumping station? — A. Yes sir. 765 Q. And in 1906 you put in that pumping station ? — A. Yes sir. Q. Have you got any other that you can mention? — A. No, there are two or three of those points along there on that gather- ing system, along the river. Q. You said you didnt know the object the New York Transit had in selling its line in New Jersey. — A. No sir. Q. Yon dont know ? — A. No sir, I dont know. Q. Did you have any conversation with any of the officials of the Standard Oil Company about that subject? — A. I was not here. Q. You were not here? — A. I was in Europe. PAYNE. 375 Q. You hadnt anytliing to do with the transfer? — A. I hadnt anything to do from the last of June until the middle of October, 1906. Q. Well, this transfer was made in 1905.— A. Oh, you are speak- ing of that transfer. Q,. The sale, yes.— A. I had nothing to do with that. Q. Who directed that sale?— A. I think Mr. O'Day. Q. Mr. O'Day?— A. I think so. Q. You know nothing about it?— A. No. He was the vice-presi- dent at that time. Q. Well, now, Mr. Payne, you Imow the Crescent Pipe Line? — A. Yes sir. Q. That is one of the Standard companies? — A. Yes sir. Q. From what place does it run? From Western Penn- 766 sylvania? — A. Why, a place near Oreggs, southwest of Pittsburg. Q. To what place? — A. To Marcus Hook, I think, and Phila- delphia. Q. When was that line constructed? — A. I could not give you the year. Q. Oh, about when ? You remember its construction, dont you ? — A. Oh, I should say that line was built somewheres from 1890 something — 1895 or 1896, somewhere along there, 1894 or 1893. Oh, wait a minute. I can refresh myself a little. Early in the nineties, '91 or '92; somewheres along there. Q. Wlio built it?— A. Built by the Mellens, I believe. Q. The Mellens of Pittsburg?— A. Yes sir. Q. Originally it was a local gathering line in Western Pennsylva- nia, wasnt it? I mean the Mellens' original pipe line was a local gathering line in Western Pennsylvania and in West Virginia? — A. They had a gathering line they built before they got any oil off their trunk lines. Q. Those gathering lines had been in existence sometime before the Crescent line was built to the east? — A. I dont think it was very long. It was a short time. Q. They had gathering lines in the West Virginia field and in Western Pennsylvania, didnt they? — A. They had a trunk line in West Virginia, what I would call a trunk line; I dont know what they termed it. 767 Q. Then they started the Crescent line to Philadelphia and Marcus Hook. Did they have some refineries? — A. I dont know whether they had a refinery or not. I think they did. I wouldnt be positive about it, I dont know positively. Q. How long did those gentlemen operate that line? — A. A few years, I dont know how many ; three or four. Q. It was a competing line to the Standard'f^ line, wasnt it? — A. Yes sir. 376 PAYNE. Q. And there wa- xfvy sbarp rom petition in the purchasing of oil in the oil region between the Cresent line or the Mellens' line and the Standard's ? — A. They had a large production of their own- oil that they produced. Q. They also bought in the field, didnt they? — A. I believe they bought oil. Q. There was very sharp competition between tliat line and your lines, Avas there not, at that time? — A. Well, I dont know as there was any special competition. They paid the same price, I think, that the Standard did. Q. Wasnt there a contest over prices in that field between the two pipe lines in buying oil from the producers? — A. I dont remember. Mr. MiLBUEN. The pipe lines didnt buy oil. Mr. Kellogg. Oh, yes, they did. Mr. MiLBTTRx. He said our pipe lines. Q. Between your purchasers and the purchasers connected with the Crescent line there was very sharp competition, was there, 768 in the purchase of oil ? — A. I dont know, Mr. Kellogg. Q. You dont know as to that? — A. No sir. Q. But they were competing lines? — A. Yes sir, I think they were competing lines. Q. When did the Standard buy that Crescent Pipe Line? — A. I think during the panic of 1903 and 1004, somewheres after 1903. Q. You mean 1893 ?— A. 1893, 1 should say. Q. And buy the stock of the Crescent Pipe Line Company? — A. I dont know. Q. Did it buy the refineries? — A. I dont know. Q. You know they bought it. Did j'on have anything to do with that purchase? — A. >To. Q. Well, do you know whethei' they had refineries to which they transported this oil or whether they sold it or whetlier they carried for other people? — A. I dont know, Mr. Kellogg, whether they had a refinery or not. Q. Why didnt you publish a tariff by the New York Transit Line and its connection to the New York Harbor? — A. Well, the line didnt extend that far. Q. Well, but in connection with the Standard Oil of New Jer- sey. — A. The New York Transit Company had no control over that. Q. No, but the Standard Oil Company of New Jersey owns the New York Transit Company, doesnt it? — A. I dont know whether it does or not. 769 Q. You dont know that?— A. I dont know. Q. What is your impression? — A. I dont know whether the Standard Oil Company of New Jersey owns the New York Transit Company or not. Q. How did it happen that the Buckej'^e Pipe Line and the other pipe lines joined in the tariff with the New York Transit Com- pany? — A. They were common carriers, and I suppose they were trying to carry out the law. PAYNE. 377 Q. Did you direct the filing of those tariffs? — A. No, I was not here when those tariffs were filed. Q. Then the reason the New York Transit didnt publish a tariff jointly with the Standard Oil Company of New Jersey is because the New Jersey Company wouldnt do it? — A. I dont know. Mr. MiLBTjRN. Because it is not a common carrier. There is the reason, simple and plain. The Interstate Commerce Commission has been advised of all these facts, as you know. Mr. Kellogg. This is not the Interstate Commerce Commission. Mr. MiLBtTEN. Oh, I forgot for the moment that it was not. Q. Speaking of these independent pipe lines in Ohio, is the Para- gon Eefining Company a gathering line, connecting Avith its refin- ery — is it a large one or a small one? — A. It is a pretty good sized line. Q. How about the Sun Line? — A. That is about the same size as the Paragon. Q. The Manhattan is much larger, isnt it, than either one 770 of them? — A. Not in size of pipe, but I think it covers more territory. Q. It handles more oil? — A. Yes sir. Ee-cross examination by Mr. Milburn: Q. Mr. Kellogg asked you about there having been no delivery station built at the junction between the New York and Pennsylvania lines, as there had been at the New Jersey line. Well, now, the New York Company that joins the Pennsylvania company at the State line is a common carrier, is it not ? — A. The New York line ? Q. Yes. — A. Yes sir. Q. And the Pennsylvania Company which joins the New York line at that point is a common carrier, is it not ? — A. Yes sir. Q. So that there were two common carriers uniting? — A. Yes sir. Q. And the Interstate Commerce Act, as amended in 1906, requires those companies to extend every facilit}' to each other in the passage of traffic from one to the other, doesnt it? — A. Yes sir. Q. Is the same true at the junction of the lines between Pennsyl- vania and Ohio? — A. Yes sir. Q. The Pennsylvania line is a common carrier ? — A. Yes sir. Q. The Ohio lines are common carriers ?^A. Yes sir; under the laws they are, yes sir. Q. Well, organized under acts making them common car- 771 riers ? So at that State line there were two common carriers ? — A. Yes sir. Q. Whose lines united? — A. Yes sir. Q. And subject to the obligations and duties imposed upon such uniting common carriers by the Interstate Commerce Act? — A. Yes sir. Q. And is the same true at the junction between the Indiana Com- pany and the Ohio Company at the Indiana and Ohio State line? — A. The same. 378 PAYNE. Q. Common carriers there, their lines meeting? — A. Yes sir. Q. And oil passing from one to the other? — A. Yes sir. Q. And subject to the obligations of the Interstate Commerce Act? — A. Yes sir. Q. But at New Jersey, the New York Company, a common car- rier coming to the State line, and then a purely private pipe line on the other side? — A. Yes sir. Q. And so the other two points that we have mentioned, Center- bridge and Fawn Grove? — A. Yes sir. Q. Mr. Kellogg spoke about the Crescent Pipe Line, its pipe line and j'our pipe line being competing lines. In the actual use of your lines, were a variety of people using your pipe lines for the transportation of oil? — A. I dont catch your question. Q. Were your lines that you referred to and that he spoke of as competing lines with the Crescent Pipe Line, in actual 772 use, used exclusively for the transportation of oil to the refineries of the Standard Oil Company or its affiliated companies ? (No answer.) Q. Did any other interests seek to ut-e your pipe line or pipe lines? — A. I dont think there was any oil tendered to us for trans- portation belonging to anyone else. Q. That is what I wanted to get at. — A. The certificates of our line were delivered, though, to other refineries. Q. Certificates of your line, and then that oil would be trans- ported. — A. Yes sir. Q. I see. That would be transported over your pipe lines to any delivery point where you were bound to make delivery under the terms of the certificate? — A. Yes sir. Q. And as to the Crescent pipe line, you dont know whether it was used exclusively for the transportation of their own oil which they produced or which they bought? — A. It was used to transport some of their own production. They had a large production of their own. Q. Yes, but you dont know whether it was exclusively used for that purpose or not? — A. I do not, no sir. Examined by Mr. I^ellogg : Q. Well, 5'ou say certificates; cUiring those days oil was taken into your pipes in the same fields or same general field that the Crescent Pipe Line Company took in oil? — A. We received 773 oil throughout the Pennsylvania fields. Q. Yes, and you issued certificates for it. — A. Whenever certificates were asked for we did, yes sir. Q. And tliose certificates were transferable? — A. Yes sir. Q. And the owners of those certificates had the oil transported through you and received the oil, or sold it at the other end of the line? — A. Within certain limits, within the district, yes sir, where the oil was produced. PAYNE. 379 Q. And in that business the Crescent line was a competing line with yours, wasnt it? — A. I dont think so. I dont think they issued any certificates at all. Q. Thej^ bought oil in the same field ? Mr. MiLBUEN. It wasnt competing in the purchase of oil. Q. They bought oil in the same field, didnt they?— A. I think they did, yes sir. Q. And they transported it to the same general market, didnt they? — A. I think they transported it for themselves entirely. Q. You think they did; do you know that? — A. I dont know that. Q. No, you dont know that. But you know they did buy oil and transport it to the same general market? — A. I know they bought oil ; I dont know what they did with it. Q. Well, they transported it, didnt they? — A. Well, they must have or they wouldnt have built a line. Q. You said the New York Company never reincorporated in New Jersey ? — A. I never knew they did. 774 Q. Thej' built their line into New Jersey, didnt they, — the New York company? — A. Yes sir. Q. And the National Transit Company built its line into New Jersey? — A. Yes. Q. And operated it for many years? — A. They bought their right-of-way and operated the line. Q. And both companies were common carriers when they did it? — A. In Pennsylvania they were common carriers, but not in New Jersey. Q. They were in New York? — A. I dont know when the New York Pipe Line law was passed. I have no knowledge of those dates. Examined by Mr. Milbtjen : Q. A man produces oil, say, in the Pennsylvania oil field. — A. Yes sir. Q. And when he delivers it into your tank, he can get a certifi- cate? — A. When he has credit on the books of the pipe line for sufficient oil to cover the amount to which they issue certificates — the amount for which they issue certificates. "\¥henever he has a credit to that amount and wishes a certificate, that certificate is issued to him. Q. Having a credit means that he has delivered into your gather- ing system that oil ? — A. Yes sir. Q. And it has been received and registered by you ? — A. Yes. Q. And then you issue a certificate for the amount for which he has credit, if he wants it ? — A. Yes sir. 775 Q. And the oil is then in your possession ? — A. Yes sir. Q. And that he can sell and have delivered at any point within the district? — A. Yes sir, any delivery point within the district. 380 CHESEBRO. Q. Any delivery point within the district ? — A. Yes sir. Q. And so if he sells that, then the purchaser can call upon you for delivery at any one of those points? — A. Yes sir. Q. You have the oil in your system and you deliver it at the points specified? — A. Yes sir. By Mr. Kellogg: Q. Has the Standard bought any other pipe lines within the last few years that you know of? — A. I think not. Q. Or bought an interest in any that you remember? — A. Not of late years that I know of. Q. Well, how late? Mr. MiLBTjEN. Well, in this suit, you know — oh, twenty years is recent! — ^A. Oh, I dont know how long ago they purchased any lines; I couldnt state. Q. Well, name some of them they purchased. — A. Well, I cant name any now. Q. Western & Atlantic, do you remember that? — A. Oh, yes, I remember the Western & Atlantic line. That is a good many years ago though. Q. About 1889? — A. Oh, I guess earlier than that. Q. Where was that line? — A. It was a gathering system in Butler County. 776 Q. Who built it?— A. I think Joseph P. Craig had some- thing to do with it. Q. The Columbia Pipe Line, they bought that l — A. Oh, that was before my date. Q. No, they recently bought an interest in the Columbia Pipe Line Company, didnt they? — A. Not that I know of. Mr. MiLBUEN. That was when he was a boy. Q. Do you know the Columbia Pipe Line in Allegheny, New York? Mr. DuEAND. About two years ago. Mr. MiLBURN. He is still a boy ! A. Well, I think there is a little bit of a line there; I dont know much about it though. Q. Did your company buy that? — A. No. Q. Bought some stock in it, didnt you? — A. No sir, I dont think so. Q. Dont you know about that Columbia Pipe Line? — A. No, I dont. Q. You dont know anything about it? — A. I dont know what you are thinking of. Mr. Kellogg. That is all. 777 George Ciiesebeo, called as a witness on behalf of Peti- tioner, being duly sworn, testified as follows: Direct examination by Mr. Kellogg: Q. Mr. Chesebro, you are the comptroller of certain pipe line com- panies? — A. I am. OHESEBBO. 381 Q. Which ones?— A. The South West Pennsylvania Pipe Lines. Q. The National Transit?— A. Yes sir. Q. The Buckeye Pipe Line Cmpany?— A. Yes sir. Q. Cimiberland Pipe Line Company? — ^A. Yes. Q. The Eureka Pipe Line Company?— A. Yes. Q. Crescent Pipe Line Company?— A. No; I am secretary of that. Q. Secretary of the Crescent Pipe Line Company ?— A. Yes. Q. Of the Indiana Pipe Line Company ?— A. Secretary. Q. Secretary of the New York Transit Company?— A. Yes. Q. And secretary of the Northern Pipe Line Company ?— A. Yes. Q. Well, now, you get the official reports from the Crescent Pipe Line Company, do you not?— A. They come to the office. _ Q. Just the same as you get them from the Buckeye and the Na- tional Transit? — A. Yes sir. Q. And you get the financial reports from the Indiana Pipe Line Company? — A. Yes sir. Q. And from the New York Transit Company? — A. Yes sir. Q. And the Northern Pipe Line Company? — A. Yes sir. 778 Q. So that you have the financial reports of the opera- tions of those pipe line companies all here in your office in New York? — A. Yes sir. Q. Now, I show you the balance-sheets of the Indiana Pipe Line Company for the years ending December 31, 1906, 190.5, 1904, 1903, 190ii, 1901, 1900, and 1899. Mr. Kellogg. I want to introduce those in evidence, and I am willing to have them marked and then you can substitute copies. Mr. Rosenthal. Very well. Mr. Kellogg. I suppose you want to keep these. Mr. RosEisTTHAL. Yes. Mr. Kellogg. Well, they may be marked then as exhibits, and we are perfectly willing that copies may be substituted for the originals if the counsel desire. The same were marked Petitioner's Exhibits 51, 52, 53, 54, 55, 56, 57 and 58, respectively. (Note: Through inadvertence. Exhibit 51 was subsequently marked Exhibit 82, Exhibit 52 was marked Exhibit 81, Exhibit 53 was marked Exhibit 80, Exhibit 54 was marked Exhibit 79, Exhibit 55 was marked Exhibit 78, Exhibit 66 was marked Exhibit 77, Ex- hibit 57 was marked Exhibit 76, and Exhibit 58 was marked Ex- hibit 75.) Q. These are marked 51 to 58 inclusive. Are they the balance- sheets, original balance-sheets of the Indiana Pipe Line Company, Mr. Chesebro?— A. Yes sir. Q. I wish to ask you some question. Take Exhibit 54 for the Indiana Pipe Line Company for 1903. Under the head of Assets is "Plant Investment." How much?— A. $3,862,724.56. Q. Now, you have deducted from that, to show the investment of the company, a depreciation of how much? — A. $1,634,004.04. 382 CHESEBEO. Q. Leaving a balance of how much ? —A. $2,228,720.52. 779 Q. That depreciation is intended to cover what, Mr. Chese- ])ro?— A. It was intended to cover depreciation on the pipe line property. Q. The pipe-line property? — A. Yes sir. Q. From the beginning of the company down, or dont you know as to that ? — A. I don't know as to that. Mr. EosENTHAL. What is the date of that statement ? Mr. Kellogg. 1903. Q. That depreciation having been charged against the income, leaves the net value or cost of the pipe line there, does it not? — A. The assumed value. Q. The assumed value, yes, of the pipe line. Now there is an item there "Oil Purchase, Contingent Account, $415,415.25." Do you know what that is ? — A. I do not. Q. That doesnt shoAv on any books you have in your office ? — A. It must. Q. It must show ? — A. Yes sir. Q. You cant explain that item? — A. I cannot. Q. You say it must show. It would show at your office, I mean, here in New York ? — A. Yes. Q. I wish you would find out about that item, because it is in sev- eral of these reports and I just want to have it explained. Mr. RosEXTHAL. You will make a note of that, Mr. Chase? Mr. Chase. Yes sir. Q. Turning to the page showing the profit and loss account, 780 it is headed " Earnings of the Trunk Line." Will you ex- plain how that is divided from the earnings of the local division ? Mr. Rosenthal. Gathering lines. Mr. Kellogg. Well, it is called local divisions in this sheet. A. Yes. The trunk line transportation earnings represents the gross earnings of the trunk pipe line. The transportation earnings of the local divisions represent those transportation earnings of the local division or the gathering department of the Indiana Pipe Line Company. Q. So that you keep their earnings and operating expenses sepa- rate, do you ? — A. I do. Q. Do your books show just what those earnings are, in your office here at 26 Broadway ? — A. No. Q. They do not show them, you mean, in detail? — A. The books of the local division are not kept in the New York office. Q. The books of the trunk line are?^ — A. The books of the trunk line are. Q. Then, your books show the earnings of the trunk line in detail?— A. Yes. Q. Where are the books of the local division of the Indiana pipe line kept?— A. Kept at Oil City. Q. At Oil City, Pennsylvania? — A. Yes. CHESEBEO. 383 Q. The condensed report of the local division furnished you, is it?— A. It is. 781 Q. Do you get any more than appears upon this balance sheet in your office, as to those local earnings ? — A. Yes. Q. What do you get?— A. I get a statement showing what these earnings aie made ujd of. Q. That is, whether it is from charges for piping oil or from any other income? — A. Yes. Q. And you get a statement of the operating expenses of the local division? — A. We do. Q. And from that these statements are made up ? — A. They are. Q. Then you can tell from the books kept in your office how much the local division earns for piping oil, how many barrels of oil is piped during the year? — A. Yes. Q. And the operating expenses for piping the oil, can you? — A. Yes. Q. And on the trunk line your books show the details of the opera- tion, do they? — A. Yes sir. Q. It shows the quantity of oil transported? — A. Yes sir. Q. The rates? — A. Yes sir. Q. And tlie total revenue? — A. Yes sir. Q. Shows the details of the operating expenses, does it ? — A. Yes sir. Q. The depreciation account and all the items of the operating expenses? — A. Yes sir. Q. Does it also show all purchases of oil by the Pipe Line Com- pany ? — A. The Pipe Line Company does not purchase any oil. 782 Q. Then that doesnt enter into its account? — A. No sir. Q. Do you make up statements, Mr. Chesebro, which show, for these various pipe line companies, the quantity of oil transported, the rates, the revenue from it, the cost of operating and the net profit of transporting oil? — A. No sir. Q. Dont you make up such statements monthly for Mr. Payne, the general manager? — A. No sir. Q. You heard Mr. Payne's testimony ? — A. No sir, I did not. Q. As I understood Mr. Payne Mr. MiLBUEN. I understood that he said there were statements that would show those things in Mr. Chesebro's possession. Q. Are such statements made up and are they in your office? — ^A. We have statements showing the quantity of oil transported and the statement showing expenses. We have no statements where we fig- ure out what it costs per barrel to transport. Q. Well, you have monthly statements in your office showing the quantity of oil transported? — A. Yes sir. Q. The revenue from it? — A. Yes sir. Q. And the operating expenses? — A. Yes sir. Q. Those statements are made up monthly? — A. They are. Q. And at the end of the year the last statement condenses the whole year, does it? — A. Yes sir. 384 CHESEBEO. Q. Those statements are more elaborate than the balance 783 sheets which you have here in evidence ? — A. Yes sir. Q. Have you those statements in your office from 1899 down to 1906, inclusive? — A. I dont know. Q. Well, have you them for the last three or four years? — A. I believe so. Q. That is true of each one of the pipe lines, is it i — A. Yes sir. Q. Take the Indiana Pipe Line, take the item of transportation under the head of Trunk Line earnings $2,817,288.50; that is re- ceived for piping oil by the Trunk Line alone, isnt it? — A. Yes sir. Q. Your statements show the rates and total revenue, do they? — A. Yes sir. Q. Now the other items following that, of income, rent receipts, tankage rentals and illl:ere^t, name the amounts. — A. Rent receipts $307.93; tankage rentals 338.71; interest $23,269.33; miscellaneous $2.10. Q. Now, the total, then, from the Trunk Line is how much? — A. Including interest earnings, $2,841,200.63. Q. This interest is interest on these bills receivable and accounts receivable shown in the investment on the first page? — A. No, it is interest on daily balances in the bank, and it may be other interest items that I dont recall. Q. Now, the operating expenses of the main Trunk Line are kept entirely separate from the division, I understand? — A. Yes sir. 784 Q. And those for that year are $206,850.21 ?— A. For operating expenses? Q. Yes. What is the next item called " General Expenses " ? — A. General expenses are expenses that cannot properly be divided be- tween trunk lines and gathering lines. Q. And so they are apportioned between them? — A. Yes. Q. Then the net income that year for the trunk line was how much?— A. The net earnings were $2,617,226.45. Q. What are the net earnings that year for the gathering lines? — A. $1,579,116.30. Q. Making a total of four million? — A. That would not make that four millions. There are some charges here. Q. Oh! — -A. The net earnings were that (pointing on sheet). Q. Give us the net profit out of the trunk lines.— A. $2,617,098.95. Q. And the net profit out of the gathering lines ? — A. $1,579,565.18. Q. The total profit for the year?— A. $4,196,664.13. Q. Now, Mr. Chesebro, the plant investment, exclusive of the items of cash, notes, and accounts receivable, merchandise as per in- ventory, and Fleming Park Property, was $2,228,720.52, was it not? — A. That is the assumed value of that plant at that time. Q. If this company does not buy oil or sell oil, what use has it in its business of cash on hand and notes and accounts as an invest- CHESEBEO. 385 ment? — A. Why, notes and accounts receivable and cash can 785 be carried on the books of a company to meet its future needs. Q. Now take the Indiana Pipe Line. — A. Yes. Q. It engages in no business that it needs a cash capital, does it? — A. Why certainly. Q. Large cash capital like $500,000 ? — A. Well, that may be part of its profits. Q. That is it. It is carrying its profits as part of the capital, isnt it? — A. Undivided profits. Q. It doesnt buy oil or sell oil and need a cash capital for that purpose? — A. No, it dont buy oil or sell oil. Q. Does it need a cash capital for any purpose except the construc- tion of additional lines, improvements, betterments, etc? — A. No. Q. Can 3'ou gi^'e me therefore, from that sheet, the net earnings of the Indiana Pipe Line Company, from its transportation on business and from storage? — A. Yes. Q. What is it?— A. $4,091,020.43. Q. And what is its investment in plant, less the depreciation? — A. $2,228,720.52. Q. Now, the other items contained in the capital of this company are as follows : Fleming Park property $104,319.09 ; Merchandise as per inventory $195,820.44 ; Notes and accounts receivable $717,386.35 : and cash $282,285.03. Are any assets used in the operation of the pipe lines from which you gave the net earnings as four million and how much?— A. $4,091,020.43. 786 Q. Yes. Is that not true? — A. The items that you read oflF are working capital; working capital which must be more or less employed in the conduct of its business. Q. What does the Indiana Pipe Line need of $282,285.03 ?— A. In cash? Q. In cash account, cash capital to pipe oil with. — A. To meet emergencies. Yoii cant tell always in a pipe line business just when you are going to be called upon to lay new lines or Q. Well, now, you havent Mr. EosEXTHAL. What else besides new lines? Witness. There is an item of merchandise which includes- Mr. Kellogo. Just wait a moment. I want to ask him about the cash. Q. Do you think it needs to keep $282,000 on hand for the con- struction of new lines ? — A. It may be called on any time to construct new lines or for repairs to its plant. Q. Well, I know, but does it need any such amount of cash on hand as that? — A. I cant tell. Q. Well, does it need bills receivable of $717,000?— A. Bills re- ceivable, those are open accounts. They are not notes, they are open accounts. More or less money is required for working capital. Q. It is practically money that has not been paid to them yet by the Standard Oil Company, isnt it?— A. I cant tell. 32555—08 -25 386 CHESEBRO. 787 Q. The oil in the pipes belongs to the Standard Oil Com- pany doesnt it? — A. Yes. Q. And the money it receives for piping oil is paid by the Stand- ard Oil Company, isnt it? — A. Yes. Q. Then, it is practically an open account from the Standard Oil Company, isnt it ? — A. It may be ; I cant tell. Q. You dont know ? What Fleming Park property is necessary to its operation, do you know? — A. No. Mr. Kellogg. These exhibits are offered in evidence at this time, if they have not been offered heretofore. Q. I show you the balance sheets of the Buckeye Pipe Line Com- pany from 1899 to 1906, inclusive. Are those the original balance sheets for that company? — A. They are condensed balance sheets of that company. Q. They are made up in the same manner as the one you have just testified to? — A. Of the Indiana? Q. Yes. — A. Yes sir. Q. And they show separately the earnings from division lines and the trunk lines? — ^A. Yes. Mr. Kellogg. I offer these in evidence, and the same stipulation may be made as to substituting copies? Mr. Rosenthal. Yes. The balance sheets for 1899, 1900, 1901, 1902, 1903, 1904, 1905 and 1906, were marked Petitioner's Exhibits 59 to 66, inclusive. 788 Balance-sheets of the Southern Pipe Line Company for the years 1899 to 1906, inclusive, were marked Petitioner's Exhibits 67 to 74, inclusive. Balance-sheets of the Indiana Pipe Line Company for the years 1899 to 1906, inclusive, were marked Petitioner's Exhibits 75 to 82, inclusive. (Note : These balance-sheets are also marked Petitioner's Exhibits 51 to 58, inclusive.) Balance-sheet of the Crescent Pipe Line Company was marked Petitioner's Exhibit 83. Balance-sheets of the Eureka Pipe Line Company for the years 1899 to 1906, inclusive, were marked Petitioner's Exhibits 84 to 91, inclusive. Balance-sheets of the Northern Pipe Line Company from 1899 and 1906, inclusive, were marked Petitioner's Exhibits 92 to 99, inclusive. Balance-sheet of the South West Pennsylvania Pipe Lines for the year 1906 was marked Petitioner's Exhibit 100. Balance-sheets of the New York Transit Company for the years 1899 to 1906, inclusive, were marked Petitioner's Exhibits 101 to 108, inclusive. Balance-sheets of the National Transit Company for the years 1899 to 1906, inclusive, were marked Petitioner's Exhibits 109 to 116, in- clusive. The hearing was then adjourned until the morning of Friday, Sep- tember 27, 1907, at 10 :30. CHESEBEO. 387 789 _ Feidat, September 27, 1907. The hearing was resumed at 10 :30 A. M. George Chesebeo, recalled as a witness on behalf of Petitioner, testified as follows: Direct-examination (resumed) by Mr. Kellogg: Q. Mr. Chesebro, I show you Petitioner's Exhibits 59 to 66, in- clusive. Are those the original balance sheets of the Buckeye Pipe Line Company? (Handing Exhibits to the witness.)— A. They are copies from the originals. Q. Copies from the originals? — A. Condensed balance-sheets. Q. I notice in the balance-sheet of 1899 a loan to the National Tran- sit Company of $.3,317,141.70 ; in the balance-sheet of 1901 a loan of $6,251,287.91; in 1902 a loan to the National Transit Company of $5,638,618.92; in 1903 a loan to the National Transit Company of $8,015,153.82: in 1904 a loan to the National Transit Company of $6,515,488.73; in 1905 a loan to the National Transit Company of $3,389,326.10 ; and in 1906 a loan of $4,616,514.86. Can you tell what those are? Mr. MiLBHRx. T^Hiat balance-sheets are those? Mr. Kellogg. The balance-sheets of the Buckeye Pipe Line Com- pany. A. These amounts represent the funds of the Buckeye Pipe Line Company on deposit with the National Transit Company. 790 Q. And in the assets, in the total capital assets of the Buck- eye Pipe Line Company, those loans are carried as an asset? — A. Yes sir. Q. Can you tell me whether it was necessary in the transaction of the piping business, carrying business, of the Buckeye Pipe Line Company, to loan money to the National Transit Company? Mr. Rosenthal. He says it represents deposits. Mr. Kellogg. Well, money deposited with the National Transit? A. We used the National Transit Company as our bankers. Q. Bankers? — A. Yes; it was subject to call at any time as the needs of the Buckeye Pipe Line Company called for. Q. But I notice that during all those years, with the exception of one, from 1899 down to 1906, the Buckeye Pipe Line Company had on deposit a large amount of money, as I have named, with the National Transit Company. That money was not needed in the transportation business of the Buckeye Pipe Line Company, and was deposited with the National Transit; is that true? — A. That is true. Q. For instance, take the year 1906 : the cost of plant, less the de- preciation, was $9,795,967.84, was it not? — A. That was the assumed value of the plant. Q. Yes, that is what it was carried on the books at ? — A. Yes, 791 it was carried on the books at cost, and offset it by this depre- ciation account. 388 CHESEBEO. Q. Yes, you had charged out of that depreciation $5,530,693.65? — A. Yes. Q. And taken that amount out of the earnings? — A. Yes sir. Q. So that the plant stood on the books at the former figure which I gave? — A. Yes, as the assumed vahie of the plant at that time. Q. That is right. Now, that plant earned that year a net of $7,028,568.40, did it not?— A. $7,028,508.40 is the profit for the year. Q. A"ow, it had in its capital account, the National Transit line of that year, of $4,616,514.86? Mr. MiLBTjEN. He said on deposit, not loan. Q. Yes, excuse me. On deposit, not loaned. — A. $4,616,514.85. Q. It is carried on the books as a National Transit loan, isnt it? — A. It is, yes sir. Q. That is why I used the word loan. Now, it had in liabilities, notes and accounts payable of $996,960.72 ? — A. Yes. Q. Why was it necessary to borrow that amount of money when it had four and a half millions or over on deposit? — A. We did not borrow the money. This represents the accounts payable on 792 the books of the company that the Buckeye Pipe Company owed for at that period. Q. Oh, yes, all right. Current accounts? — A. Current accounts. Q. What is this "Oil Purchase Contingent, $2,331,701.16"? It appears in the liabilities of that account. — A. That represents a con- tingent account which might eventually be used to cover losses in handling the oil during the company's business. Q. And is carried as a liability on your account? — A. A contin- gent liability. Q. Against the cash assets? — A. Yes sir. Q. Now, there is another. I show you the balance-sheets of the Southern Pipe Line Company, Petitioner's Exhibits 67 to 74, in- clusive. Are those the original balance-sheets or copies of the orig- inal balance-sheets? — A. They are condensed balance-sheets, copies of the original balance-sheets. Mr. Kellogg. I offer these in evidence. Mr. MiLBUEN. What are those? Mr. Kjesllogg. Exhibits 67 to 74, the Southern Pipe Line balance- sheets. And now I wish to offer the Buckeye Pipe Line Exhibits 59 to 66, in evidence ; I forgot that. Q. Going back to the Buckeye Line, I wish to ask you one more question. You carried in the year 1906 the " Oil Purchase 793 Contingent ", you said of $2,331,701.16. Why was it necessary to carry any such contingent account as that in the Buckeye Pipe Line? No losses for a year would begin to amount to such a sum as that, would they? — A. No. Q. Well, then, why carry as a liability over two and a quarter million dollars to cover any contingent loss on the shrinkage of oil ? — A. We cant tell in the conduct of business, in settling the accounts with our customers, whether we might not be called upon sud- denly to co^•er some large losses. If the business wound up and we CHESEBBO. 389 found we did not have enough oil in our custody to meet our liabili- ties, we would be liable, and it might amount to two millions, and it might amount to less. Q. Now, I notice that during all these years in the Buckeye Line you carried a large contingent account, from a little over a million to two and a quarter millions ; that is correct, isnt it ? — A. Wliatever it shows on those statements would be the right amount. Q. Well, take it for the year 1906 ; with that contingent account, did you charge out any to losses on that account, in the expenses? (Handing witness balance-sheet.) — A. It doesnt show here, but we always have large losses that are charged to our expense account each year. Q. Well, your total earnings on the main line, — or what do you call that? — A. The Lima Division. Q. On the Lima Division that year were $4,227,271.09, were 794 they not? — A. They were. Q. Well, what were your total operating expenses? — A. $939,417.20. Q. Well, now, was any of that contingent loss, or loss for shrink- age ? — A. Any amount charged in there was actual losses. Q. Was any part of the losses charged into the expense, or was it charged under profit and loss account? — A. It was charged into ex- pense. Q. So you dont know how nrach was charged ? — A. No sir. Q. The details will show ? — A. Probably will. Q. You dont pretend to say that any considerable amount of those operating expenses were such losses, do you ? — A. I am unable to say. Q. Well, you make up these every year, you know something about them?— A. I do. Q. It would be compai-atively a small amount? — A. It might be large and it might be small. Q. The details of your account will show ? — A. They will. Q. It is true, is it not, that in no year you needed to carry two and a quarter million dollars against such a liability? — A. No, we didnt need to carry it. Q. That is what I thought. And taking the Southern Pipe Line Company for the year 1899, I notice that the net plant investment, value of the plant carried on your books, was $2,125,667.19. 795 (Handing witness balance-sheet.)— A. $2,125,667.19. That was the assumed value of the plant. Q. Yes sir.- A. The cost of the plant was $3,823,356.14. We had charged off to the end of that period an amount for depreciation equalling $1,197,688.95, leaving the assumed value of the plant at the end of the year 1899 as stated. Q. But the $1,697,688.95 had been previously taken from earnings and charged to depreciation ?— A. It had ; or credited. Q. Yes, it is the same thing. Now, the actual gross earnings for that year were $4,336,618.60, were they not?— A. $4,336,618.60, correct, sir. 390 CHESEBRO. Q. Now, I wish you would give the items of operating expenses which you deducted from that gross earnings to show how much the net earning was. — A. Operating expenses, $238,193.42. Q. Now, one moment. That includes all depreciation or loss on account of shrinkage of oil which would be covered by the con- tingent fund, doesnt it? — A. Yes. Q. And the cost of operating the plant, with the exception of the general expenses? — A. Yes. Q. Now, the genej-al expenses were how much? — A. $78,329.76. Q. Now, deducting those two items from the gross earnings, what would that make the net profit? Will you just figure 796 that up? I want to get it in the record. I want to ask you then about the next item.— A. $4,020,095.42. Q. Now, I notice you charge as against your gross earnings that year an item P. S. f rainor, $2,607,852.99. Why did you do that?— A. It was a charge made, T think, under the directions of my prede- cessor, and I am unable to say what it is for. Q. Well, it certainly was not operating expenses, was it? — A. I dont know. Q. Well, you know enough about the balance sheets showing the operating expenses of that company to know that there wasnt two and a half millions of operating expenses that year in addition to the items you gave, dont you ? — A. I could not say what the amount was for. Q. Excluding that item, the company earned about two hundred percent, didnt it, on its value of plant carried on the books? Mr. MiLBURN. Well, dont the figures state for themselves? They are in evidence. Mr. Kellogg. Xo, the figures dont speak for themselves. They have to be explained, Mr. Milburn. That is the reason I want to ask. A. Practical Ij'. Q. Now, you are reasonably familiar with the operating expenses of these pipe lines, are you not, Mr. Chesebro ? — A. Yes. Q. Can you imagine any item of expense, in the operation 797 of the Southern Pipe Line Company, amounting to $2,607,000 for that year? — A. There may haA-e been; I dont know. Q,. Well, I wish you would look up that item of $2,607,852.99 in the balance sheet of 1899 of the Southern Pipe Line Company and find out what that item of expense was. It certainly was not " Oil Purchase Contingent," was it? That is carried as $2,921.18 in yom' liabilities? — A. No. Q. It wasnt' that. Now, take the very next year, for 1900; I would like some explanation of that account; the plant investment (and when I ask for plant investment I mean less the deprecia- tion) was for 1900 $2,152,722.81, was it not?— A. Yes sir. Q. The gross profits were $4,259,209.73, were they not?— A. Yes air. CHESEBRO. 391 Q. Now name the operating expenses that you charged against that four million and a quarter dollars or thereabouts. — A. Operating ex- penses, $229,739.13 ; general expenses, $77,386.59. Q. Yes sir. Deducting that from the total gross earnings, what would have been the net earnings? — A. $3,952,084.01. Q. Now, as a matter of fact, you charged to operating expenses, P. S. Trainor, $4,599,838.46, did you not?— A. Yes. Q. Making a loss for the year of $662,512.69 ?— A. Right. Q. Do you think that four million and a half dollars was 798 an operating expense? — A. As I said before, I know nothing of that account. Q. Knowing the operating expenses of that company, you know it was not an operating expense, dont you ? — A. I could not say. Q. For the actual operation ? — A. I could not tell. Q. Well, if you dont know those, there is no use asking you any more about them. Are you familiar with that item in any one of the accounts from 1899 clown to 1906? — A. I am not. Q. I notice in the year 1906 the total operating expenses of this plant were $389,574.45, werent they? (Handing witness balance- sheet.)— A. $389,574.45. Q. And that is a little more than the figure for 1899, taking out the Trainor account, isnt it? — A. Yes. Q. And I will ask you if the operating expenses during all of those years did not run in the neighborhood of from three hun- dred to three hundred and eighty thousand dollars. (Handing wit- ness balance-sheet.) — A. They did. Q. And in 1906 no such item of P. S. Trainor account was charged in the expenses? — A. No. Q. Well, then, you would judge that the legitimate operating expenses of the plant during those years were about the sum of from three hundred to three hundred eightj'' thousand, wouldnt you? 799 Mr. MiLBUEN. Say the " normal " instead of legitimate. Q. All right, then I will say the normal operating ex- penses. — A. Yes ; but I do not know what that item is. Q. Would the detailed statements in your office of operating ex- penses show what that is? — A. I could not say. Mr. Kellogg. I wish you would look up each one of these items charged against income from 1899 to 1906, inclusive, in that account, and see what it is. Southern Pipe Line Company. Q. Your predecessor directed you to make that one for 1906, did he?— A. He did. Q. Did he make any explanation of what it was ? — A. He did not. Q. I guess that was 1905, perhaps I made a mistake. Yes, 1905. I beg your pardon. — ^A. 1905. Q. Since that time there has been no such item ? — A. No. Q. Who was your predecessor? — A. Mr. John Bushnell. Q. When did he leave the office. — A. He resigned as of July first, 1906. 392 CHESEBEO. Q. '\^n[ien did he actually leave the office? — A. July first, 1906. Q. He has not been there since? — A. He has not been there since. Q,. Do you know where he is? — A. I do not. 800 Mr. MiLBURN. Did he say John Bushnell resigned in 1906? Witness. I did say 1906 ; it was July first, 1907. Q. In the account for 1906 of the same company. Southern Pipe Line Company, I notice a loan to the National Transit of $6,542,000. I suppose that is the same thing that appeared in the other pipe line. It is money on deposit with the National Transit ? — A. It is. Q. I show you balance-sheets, New York Transit Company, De- cember 31, 1899, to December 31, 1906, inclusive, being Exhibits 101 to 108. Are those the balance-sheets of that company? — A. Con- densed balance-sheets. Q. Condensed balance-sheets of that company ? — A. Yes sir. ilr. Kellogg. I offer the same in evidence. Petitioner's Exhibits 101 to 108, inclusive. Q. I show you the balance-sheet of the New York Transit for De- cember 31, 1899, Petitioner's Exhibit 101. There is an item in the operating expenses of that company, Crosstown Pipe Line Rentals, $514,489.69. I will let jon look at the figures and go through with them so that you can verify them. In the one for 1900, $1,129,054.54; in the one for 1901, $1,191,145.86.— A. Eight. Q. In 1902, $1,138,142.11 ?— A. Eight. Q. In 1903, $616,312.76 ?— A. Correct. Q. 1904, $606,325.421— A. Correct. Q. 1905, $438,191.03?— A. Correct. Q. It disappears in the account of 1906, does it not? — 801 A. It does. Q. Those figures are all correct, as I read them? — A. Yes sir. Q. What was that rental for ? — A. It was a rental for the pipe line that crossed the city of New York. Q,. From the Jersey shore to Long Island? — A. From the middle of the river, the North Eiver, to Long Island. Q. From the middle of the North Eiver to Long Island. "^Vhat company owns that line? — A. I don't know, now. Q. WTiat company did own it prior to 1905 when this rental ac- count appeared? — A. We paid the rental to the Standard Oil Com- pany of New Jersey. Q. The New York Transit Company, then, operated that line and the operating expenses of that line were figured in its expense account, were they not, for those years? — A. I dont recollect. Q. Well, the rental account would not be in the operating expenses of the New York Transit Line unless it operated it, would it? — A. No, I shouldnt think so. Q. You were in the office before Mr. Bushnell left, were you not? — A. Yes sir. Q. What was your position? — A. I was his assistant. Q. You were his assistant; for how many years? — A. Oh, I dont recall; it must be seventeen years. CHESEBEO. 393 Q. Seventeen years? — A. I think so. Q. Then, dont you know that the New York Transit Com- 802 pany operated that Crosstown Line down until say November, 1905? — A. Yes, they operated the line. Q. Yes, that is what I thought. And paid this rental to the Standard Oil of New York?— A. The Standard Oil Company of New York. Q. Have you any of the accounts of the Standard Oil Company of New York in the balance-sheets in your office? — A. No sir. Q. Do you know what company owns that line now? — A. I do not. Q,. Do you know anything about the value at which that Cross- town Line was carried on the books of the Standard Oil Company of New York? — A. I do not. Q. Has the New York Transit Company operated that line during the last two years? — A. Not since November first, 1905. Q. What company does operate it? — A. I dont know. Q. Dont you get the accounts of all of the pipe lines in your office? — A. Yes. Q. And dont you get the accounts, details of the operation of the pipe lines belonging to the Standard Oil of New Jersey ?^A. I do not. Q. Those pipe line accounts dont come to your office at all? — A. They do not. Q. Do you get the accounts of the pipe lines of the Prairie Oil & Gas Company? — A. Yes. Q. You have balance-sheets of the Prairie Oil & Gas Com- 803 pany similar to the ones of the other pipe line companies, have you? — A. Yes. Q. Showing the details of the earnings and the details of the oper- ating expenses? — A. Yes. Q. Do you make up condensed balance-sheets like these? — A. I do not. Q. Do you get condensed balance-sheets like these ? — A. I do not. Q. But the details, such as you testified yesterday you had for these various pipe line companies, you have for the Prairie Oil & Gas Company? — A. Yes. Mr. Kellogg. We would like to have Mr. Conant have an oppor- tunity to examine those at the same time he examines the others. Mr. MiLBURN. Mr. Chase, make a note of it. Q. You have been in the office for seventeen years, about? — A. About. Q. And Mr. Jolui Bushnell was the controller ? — A. He was. Q. Were you assistant controller? — A. I was. Q. Well now, you had charge of everything under Mv. Bushnell's direction? — A. I did. Q. Until his resignation? — A. Yes sir. Q. Now, Mr. Chesebro, during that time didnt you find out any- thing about this enormous item of from two to four million dollars 394 CHESEBEO. charged against the earnings of the Southern Pipe Line?— A. I did not. 804 Q. No explanation was given? — A. No explanation was given. Q. Did it commence in 1899? — A. I dont remember. Q. Prior to November 1, 1905, what company owned and operated the line of pipe from Unionville, New York, to or near Bayonne, New Jersey? — A. The New York Transit Company. Q. Since 1906 has the New York Transit Company operated it?— A. It has not. Q. What company has operated that ? — A. November 1, 1905, that line was sold to the Standard Oil Company of New Jersey. Q. Has that company operated it since that time? — A. I dont know anything about it. Q. It was taken out of your books entirely ? — A. It wns. Q. No accounts of the operation of it have since that date come into your office? — A. No. Q. That line extended, did it, to the middle of the North River?— A. It did. Q. And also down to Bayonne? — A. It did. Q. Do you know what company has, since November 1, 1905, oper- ated the Crosstown line? — A. I do not. Q. Or owned it? — A. I do not. Q. Nothing in your books showing anything about those opera- tions? — A. No sir. Q. The National Transit, prior to November 1, 1905, operated the line from Centerbridge to Bayonne, also, did it not? — 805 A. It operated the line from*Millway to Bayonne. Q. From Millway?— A. Yes. Q. That is in Pennsylvania? — A. Yes. Q. To Baj^onne? — A. To Bayonne. Q. And the National Transit Company owned that line prior to November 1, 1905, didnt it? — A. It did. Q. After 1905 what company owned it and operated it? — ^A. As of November 1, 1905, that line from Centerbridge to Bayonne was sold to the Standard Oil Company of New Jersey. Q. For what price ? — A. I dont recollect. Q. Can you tell by looking at the balance-sheets of the National Transit Company? — A. No. Q. You can not? — A. No. Q. Or you dont know whether the Standard of New York bought the Crosstown line or not? — A. I dont know. Q. I shoAv you petitioner's exhibits 84 to 91, being the balance- sheets of the Eureka Pipe Line Company. Are those the balance- sheets of the Eureka Pipe Line Company ? — A. Yes sir. Mr. Kellogg. I offer them in evidence. Petitioner's Exhibits 84 to 91, inclusive. Q. I show you the balance-sheets of the Northern Pipe Line Com- pany, Exhibits 92 to 99. Are those the balance-sheets of that com- CHESBBEO. 395 pany? — A. Yes, from 1899 to 1906. I think you didnt get the years quite right. 806 Mr. Kellogg. Oh, I beg your pardon, yes. Q. I show you the balance-sheet for 1906 of the Southwest Pennsylvania Pipe Lines, being Petitioner's Exhibit 100. Is that the balance-sheet of the Southwest Pennsylvania Company? — A. It is condensed balance-sheet, a copy of it. Q. Have you the prior balance-sheets of that company in your of- fice — details of them ? — A. I dont recollect. Q. This seems to be only one year. — A. I dont know whether we have a copy like that or not. Q. Well, I mean you have the detailed statements from the South- west Pennsylvania Line, the same as the others. — A. Yes. Q. For a number of years back ? — A. Yes. Mr. Kellogg. I offer Petitioner's Exhibit 100 in evidence. Q. 1 show you the balance-sheet for the Crescent Pipe Line Com- pany of December 31, 1906, Petitioner's Exhibit 83. Is that the balance-sheet of that company for that year ? — A. Yes. Mr. KJELLOGG. I offer the same in evidence. Q. 1906 — ^there seems to be no prior balance-sheets. You have the details of this company the same as the others? — A. Yes. Q. I show you Petitioner's Exhibits 109 to 116, general balance- sheet, ISTational Transit Company, December 31, 1899, to Decem- ber 31, 1906. Are those the balance-sheets of that com- 807 pany?— A. Yes. Mr. Kellogg. I offer them in evidence. Q. I notice in the National Transit's balance-sheets that that com- pany has other business besides piping and transportation of oil ; that is true, isnt it? — A. It owns stocks in other companies. Q. And during a number of years it carried in these accounts a loan to Messrs. Folger and Payne. Do you remember that? — A. Yes sir. Q. You keep, however, do you not, in your office, detailed state- ments showing the gross and net income from the piping and storage of oil separate from its other income, do you not? — A. Yes. Q. So that you can show Mr. Conant the details of the operation of the pipe lines separate from its other business? — A. Yes. Q. I notice in the balance-sheet of 1903, and in some of the others, a loan to T. M. Barnsdall. In 1903 it is $270,581.30 ; in 1902 it is $422,247.61. Do you know what that item is? — A. No. Q. You do not?" — A. I dont remember. Q. Do you know the Barnsdall Oil Company of Indian Terri- tory? — A. I do not. Q. Never heard of it ?— A. Only what I have seen in the papers. Q. You dont know whether this is connected with that or not ?— A. I dont know. 808 Q. Could you find out?— A. Yes. Mr. Kellogg. Make a note of that Mr. Chase. 396 OHESEBEO. Q. Are you familiar with the accounts of the pipe line companj' which owns the line from the Pennsylvania state line to Baltimore ? — A. That is from Fawn Grove to Baltimore ? Q. From Fawn Grove to Baltimore, yes. What company is that ? — A. That line was sold as of November first, to the Standard. Q. Prior to November 1, 1905, that line was owned by what com- pany ? — A. That line was owned by the National Transit Company. Q. On November first, the line from Fawn Grove, which is on the Pennsylvania state line between Pennsylvania and Maryland, was sold to the Standard Oil Company of New Jersey, was it ? — A. Yes. Q. And since that time has been operated by what company? — A. I dont know. Q. You dont know anything about it? — A. I dont know anything about the Q. Do you know why the gross earnings and the details of opera- tion or operating expenses have not been returned to your office for the pipe lines owned by the Standard Oil Company of New Jersey? — A. The National Transit Company have nothing to do Avhat«ver with those lines. I should say the National Transit Company have noth- ing to do with those lines. Q. Quite so, but the Prairie Oil & Gas Company's lines are re- turned to your office, are they not? 809 Mr. Rosenthal. He said they were some time ago. Witness. I said so. Q. Now, that company owns other property besides pipe lines?— A. The Prairie Oil & Gas Company? Q. Yes. — A. Oh, yes. Q. Why shouldnt the pipe lines all be returned to your office in the same way? — A. We have no connection whatever with the lines of the Standard Oil Company of New Jersey. Q. Have you the reports of the Ohio Oil Company? — A. State- ments are sent to me. Q. Now, the Ohio Oil Companj^ owns the pipe line to the Illi- nois field, does it not? — A. No. Q. Where is the line of the Ohio Oil Company, do you know? — A. The Ohio Oil Compan}^ is an oil producing comjinuy. and in the conduct of its business it has some lines in Illinois and Ohio. Q. And Indiana ? — A. And in Indiana. Q. It owns the line, does it not, frona the Illinois oil field in southeastern Illinois, into Indiana, where it connects with the In- diana Pipe Line Company? Here is a map. I show you Peti- tioner's Exhibit 50. — A. It has a line running up to Preble. Q. Yes, it has a line running from the Illinois field up to Preble, Indiana. — A. Yes. Q. Does it own an^' other lines? — A. It owns gathering lines in Ohio and Illinois and Indiana. Q. Gathering lines in Ohio, Illinois and Indiana? — A. 810 I wouldnt say gathering lines; it owns lines there, taking oil from its wells. CHESEBEO. 397 Q. Now, you receive the reports showing the earnings and the details of operations of the Ohio Oil Company, dont you ? — A. Yes. Q,. It has other business besides merely piping oil, hasnt it? — A. It is not engaged in the transportation of oil. Q. It is not engaged in the transportation alone, did you say ? — ^A. Of oil. It is an oil producing company. Q. Yes, it is an oil producing company, but the statements of its operations are furnished to your office? — A. Yes. Q. And have been for how many years? — A. Oh, for a number of years. Q. Back to 1895?— A. I dont recollect. Q. 1896? — A. I will just say ever since it was organized; I dont knoAV. Q. Ever since it was organized? — A. I dont recollect just how far back the statements go. Q. In 1899 it was in operation, and you were receiving state- ments, were you not? — A. I dont Imow. I cant recollect the date. Mr. Kellogg. I will get the charter and show you when it was organized, in a moment. Q. Is the detail of all its earnings and operating expenses sent to your office? — A. Yes. Q. Its balance sheets showing its property owned and property ac- quired? — A. Yes. Q. So your accounts will show what property the company owns and what property it acquired from year to year? — A. Yes. Q. Did the Ohio Oil Company purchase the producing 811 wells of the Manhattan Oil Company in 1899 or 1900?— A. I dont know. Q. Your books will show, will they not? — A. The statements may not be in detail enough to show any such transaction. Q. You know about the Manhattan Oil Company, dont you? — A. I have heard its name. Q. Is that all you know of it, simply heard its name ? — A. That is all I know of it. Q. The Ohio Oil Company seems to have been organized originally in 1887, according to the certified copy of the charter which we have. I will show it to you, if you wish to look at it. — A. It is a long while ago. Q. Yes. Mr. EosENTHAL. 1887? Mr. Kellogg. 1887. Q. You probably were receiving the statements in 1898, 1899, and 1900, were you not ? — A. Yes, probably. Q. Are you an officer of the Ohio Oil Company ? — A. Yes. Q. Comptroller ? — A. No, I am not. I am not at present. Q. You are not at present the comptroller ? — A. I am not an officer of the Ohio Oil Company at present. Q. Have you been? — A. I have been. 398 CHESEBBO. Q. Were you in 1899 ? — A. Yes, assistant comptroller in 1899. Q. You were assistant comptroller in 1899? — A. Yes. Q. And 1900?— A. Yes. Mr. EosENTiiAL. 1906, 1 think it was. Q. And down to 1906 ?— A. Yes. 812 Q. Who are the officers of the Ohio Oil Company there now? Mr. Rosenthal. There are about twenty of them tliere, I think, Mr. Kellogg, as shown on the card. (Exhibit 18.) Q. Do you Ivnow who the comptroller is now ? — A. No. Q. You were the assistant comptroller down to and including 1906?— A. Yes. Q. I show you the card in evidence, Petitioner's Exhibit 18 (No. 87.) Turn it over. It seems to have two pages of officers. This says you were all elected and appointed May 31, 1906, with the exception of Messrs. Curry, Herr and Hurley. " See letter from Mr. Chesebro dated Noveniber 8, 1906." Do you Itnow what that means' — A. Well, whenever there is an election of officers, I notified the party that had that card of the changes in the officers. Q,. Who is the comptroller now? — A. I dont Iniow whether they have a comptroller. Q. Your office receives the reports, doesnt it? — A. No. Q. When did they cease coming to your office? — A. We receive the financial reports, yes. Q. You receive the financial reports and the details of operation ? — A. Yes. Q. From whom do you receive tliose? — A. We receive them now from the vice-president of the company. Q. Who is he?— A. Mr. A. C. Bedford. Q. Was the Ohio Oil Company reorganized as to its staff of offi- cers in 1907 ?— A. It was. Q. What was the reason for it? — A. I dont know. 813 Q. Was there any change in the operation of your office in the receipt of re]Dorts and lieeping of the accounts at that time? — A. Yes. Q. What change? — A. The reports are handed to me to keep for the vice-president. I do not receive them direct. Q. Where is the vice-president's office? — A. In Findlay, Ohio. Q. Are there any officers in New York? — A. A. C. Bedford. Q. He is president? — A. Vice-president. Mr. Rosenthal. Mr. Archbold is president, isnt he? Q,. Mr. John D. Archbold president yet? — A. I believe he is. Q. Does Mr. Bedford have an office at 26 Broadway? — A. I believe he has. Q. Any other officers there that you know of ? — A. No. Q. What was the occasion for the re-organization of the officers, do you know ? — A. I dont know. Q. Dont Imow anything about that ? — A. I do not. Mr. Kellogg. Will you look up your accounts and see if the Ohio Oil Company in the year 1899 or 1900 purchased the producing OHESEBKO. 399 wells or any properties of the Manhattan Oil Company, the amount paid therefor and the date of purchase? Mr. Chase will give you a statement. (No response.) Q. Do you know whether this Ohio Oil Company has a secretary in New York? — A. No. Q. It seems to have a secretary, a first assistant secretary, a second assistant secretary, and an assistant secretary. 814 Mr. MiLBURN. It is well equipped with secretaries, isnt it? Mr. Kellogg. Yes. Q. H. McSweeney is the secretary. Do you know him? — A. Yes. Q. Where does he reside ? — A. Oil City, Pennsylvania. Q. S. R. Ball, first assistant secretary: where is his office? — A. He had an office at Oil City, Pennsylvania. Q. F. E. Hurley, second assistant secretary: where is his office? — A. I think it is Findlay, Ohio. Q. And E. J. Berry, assistant secretary: where is his office? — A. Findlay, Ohio. Q. Theodore M. Towl, tax agent: where is his office? — A. New York. Q. 26 Broadway?— A. Yes. Q. Where is Mr. Theodore M. Towl; is he there?— A. I dont know. Q. Have you seen him lately? — A. I have not. Q. F. H. Hillman, general manager, Pipe Line branch, where is his office ? — A. Marshall, Illinois. Q. The treasurer, F. S. Bates, where is his office?— A. Findlay, Ohio. Q. F. S. Curry, first assistant treasurer: where is his office? — A. Findlay, Ohio. Q. And Joseph E. Herr, second assistant treasurer ?— A. Findlay, Ohio. Q. And the comptroller, I have forgotten who you said his name nyas. — A. I dont know as they have a comptroller. Q. You dont know. — A. No. Q. You have no recollection of the purchase of the property 815 of the Manhattan at all ?— A. I have not. Q. Have you any accounts in your office of any kind, show- ing any dealings with the Manhattan or the owners of the Manhattan Oil Company?— A. I have not. Q. I believe you said you were comptroller now of the National Transit, didnt you, and you were assistant comptroller for many years before you were comptroller ? — A. Yes. Q. Who has charge of the papers and contracts of the National Transit Company? — A. I have. Q. You have?— A. As secretary. Q. As secretary? — ^A. As secretary. Q. You have the books showing the proceedings of the board of directors and stockholders at their meetings ?— A. Yes. 400 WHITE. Q. From the time of tlie organization of the company down to the present time? — A. I believe so. Q. Have you a contract made and entered into the 9th of October, or thereabouts, in 1883, between the National Transit Company and the United Pipe Lines, parties of the first part, and the Tidewater Pipe Company, Limited, party of the second part ? — A. I have not. Q. Will you please produce the record book showing the proceed- ings of the board of directors and stockholders of the National Tran- sit Company from its organization down to the present time ? I wish to examine it. (No response.) Q. Have you made any search for such a contract as I speak of. — A. Yes. 816 Q. Have you any record in the minute book of the proceed- ings of the Board of Directors or stockholders? Mr. EosENTHAL. There are some records relating to that contract ; I dont know whether Mr. Chesebro knows of it or not. I know of it. Mr. Kellogg. All right, I will withdraw the question. Mr. Rosenthal. There is a record there of tlie adoption of the con- tract and its ratification. Mr. Kellogg. That is right. I think we can probably stipulate as to that contract, and we will pass that at present. I wont ask Mr. Chesebro about it. I think that is all I have to ask Mr. Chesebro until an examination has been made of those detailed statements, and I dont know as I shall wish to ask him anything then, but I may wish to identify the statements. No cross-examination. 817 Charles T. White, Called as a witness on behalf of Peti- tioner, being duly sworn, testified as follows : Direct-examination by Mr. Kellogg: Q. Mr. White, you are the assistant secretary of the Standard Oil Company of New Jersey? — A. I am. Q. What other companies are you secretary or assistant secretary of? — A. I am assistant secretary of the Standard Oil Company of New York. Q. Any other of the Standard Oil companies or associated com- panies of any name ? — A. The assistant secretary of the Standard Oil Company of Kentucky. Q. Do you remember any others? — A. Assistant secretary of the Standard Oil Company of Indiana ; secretary of the Atlantic Refin- ing Company; assistant secretary of the Solar Refining Company. Q. Will you look at the list of companies on page 62 of the bill of complaint, and state if you are an officer, that is, a secretary or assist- ant secretary, of any one of those companies except those you have named. — A. I think I have named all, Mr. Kellogg. Q. Do you keep in your office the transfer books of the Standard Oil Company of New Jersey? — A. I do. WHITE. 401 Q. Do jon keep the transfer books of the Standard Oil Com- 818 pany of New York ? — A. I believe I do. I should have to look. Q. Do you keep the transfer books of the other companies which you have named? — A. I think so. Q. Did you name the Standard Oil Company of New York? I have forgotten. — A. I did. Q. Did you name the New York Transit Company? — A. I did. Q. You are not connected with that ? — A. Not in any way. Q. You have the records showing the stock voted annually, and the names of the stockholders voting every year in the Standard Oil Company of New York? — A. I couldnt say, except for the last few years, Mr. Kellogg. Q. There was introduced in evidence a list of stockholders, being Exhibit 19, who voted at the meeting of the Standard Oil Company of New York on January 7, 1896, furnished by Mr. Tilford (hand- ing the exhibit to the witness) , together with a copy of a certificate filed in the County Clerk's office, of the total number of votes cast for each director, and the total number of share-holders entitled to vote. — A. Yes sir. Q. Was that taken from j'^our books? — A. I couldnt say. Q. Under the laws of New York, dont you keep, and file every year with the County Clerk, a list of stockholders voting at every election, the total number of votes cast, and the total number of shares entitled to vote? — A. Yes sir. 819 Q. "Well, then, you must have a record of it. — A. There may be, but I wish to state that I have been assistant secretary only a few years. It was long after this time. I cant say what was done before my time. Q. You have the books showing whatever was done, havent you ? — A. Yes sir. Q. Now, will you please furnish us the books of transfer, showing the number of votes cast at each election from 1892 down to and in- cluding the year 1902, the names of the stockholders voting, the number of shares voted, the total number of shares entitled to vote, and a copy of any certificate filed in the office of the County Clerk showing those facts? This is for the Standard Oil Company of New York. — A. Yes sir, I will endeavor to. Mr. I^LLOGG. I also wish that statement to show in whose name the shares stood; for the reason that this list shows the total stock voted, the names of the stockholders, and the total stock standing in the Trustees of the Standard Oil Trust not voting. (Handing wit- ness Petitioner's Exhibit 19.) Q. You have the transfer books also, have you not, of the Standard Oil Company of New York ? — A. Yes sir. Q. The transfer books will show the number of shares of stock out- standing in the Standard Oil Company of New York at any time since its organization, in 1882, will they not? — A. T should pre- sume so. 32555—08 26 402 WHITE. Q. And those books are in your office ? — A. I believe they are. 820 Mr. Kellogg. I would like a statement showing the total number of shares outstanding each year from 1892 to 1900, inclusive, and in whose names the stock stood. Witness. May I ask as of what date? Of each year? Mr. MiLBUEN. What date do you fix? Q. You close your transfer books, dont you, at certain days in the year, in the Standard Oil Company of New York? — A. No sir. Q. Only those companies whose stock is sold on the market close their books ; is that true ? — A. I dont understand that. Q. Only those companies whose stock is generally sold on the market close their books before the annual meetings? — A. Yes sir. Q. I simply ask that as a matter of convenience. — A. I think that is so. Q. Because if you have your books closed you must make up stock lists, and it would be more convenient for you to furnish the list as of the day of closing the books. — A. I understand. Q. Whether the Standard Oil Company of New York has a day on which it closes its books, you can tell us, I suppose. — A. I think so. Mr. Rosenthal. He says they have not. Mr. MiLBTiEN. Why dont you have it of a date with refer- 821 ence to the annual election, ten days before the annual election or two weeks before the annual election? He probably does not know on what date the annual election is. Mr. Kellogg. I have no objection to your making it either on the day of the annual election, or on any other day near it which is most convenient, and show it in such a way as it can be made up with the least labor. Q. Have you the transfer books of these other companies of which you are secretary or assistant secretary, that you named? — A. I may have some. Mr. Kellogg. I would like the same information, if you have it, for all of the companies of which you are the secretary or assistant secretary, for those same years. Mr. Chase will have that written off for you. A recess was here taken until 2 o'clock P. IM. 822 ArrERxooN .Session. Charles T. White was recalled on behalf of Petitioner, and testified as follows: Direct-examination by Mr. Kellogg: Q. I believe you said you keep the transfer books of the Standard Oil Company of New Jersey? — A. Yes sir. Q. Do you keep the transfer ledger and journal? — A. Yes sir. Q. In the journal is entered — First, you iinve a certificate book? — A. Yes sir. WHITE. 403 Q. Showing each certificate issued by the Standard Oil Company of New Jersey? — A. Yes sir. Q. And you have those books from the beginning of the company, ha vent you?— A. From 1899. Q. Havent you the boolfs preceding that date? — A. I cant say now; I may have. Q. The Standard Oil Company of New Jersey was organized in 1882, wasnt it? — A. Yes sir, in that neig-hborhood. Mr. MiLBUEN. When did he become secretary* Q. Wlien did you become the assistant secretary? — A. May 1, 1900. Q. When you went in, you found the certificate and transfer books there, didnt you? — A. Yes sir. Q. Then you also keep a journal? — A. Yes sir. Q. Every certificate of stock issued is put in that journal? — A. Yes sir. 823 Q. Giving the name of the party to whom it is issued, the number of the certificates and the amount ? — A. And the num- ber of shares. ' Q. And the number of shares? — A. Yes sir. Q. And the date of issue? — A. Yes sir. Q. And those items are transferred to a stock ledger? — A. Stock journal first. Q. I say from the stock journal to the stock ledger? — A. Yes sir. Q. All certificates returned and cancelled are pasted into the cer- tificate book? — A. Yes sir. Q. And entered on the journal and ledger? — A. Yes sir. Q. And the name of the new transferee appears on those books?— A. Yes sir. Q. Do your books show the issue of all stock about the last of 1899 or beginning of 1900 for the stock of the various twenty companies which were in the Trustees of the Standard Oil Trust? — A. I pre- sume that would be the original issue of the stock. That would show, yes sir. Q. That is, the stock of the Standard Oil Company of New Jersey was increased in 1899 to $110,000,000 ; the preferred stock was taken in and cancelled, wasnt it? — A. Yes sir. Mr. MiLBUEN. That is, the common stock then was made the pre- ferred ? Mr. Ejellogg. Yes, that is right. Q. The common stock which had previously been outstanding, amounting to ten millions was made preferred? — A. Yes sir. Q. And that was taken in and cancelled ? — A. Yes sir. 824 Q. And common stock of the Standard Oil Company of New Jersey issued for it? — A. Yes sir. Q. And then other common stock issued for the stock of the other nineteen companies? — A. I couldnt say that that was it. Q. All original issues of stock by that company after the increase of stock are shown on your books? — A. Yes sir. 404 WHITE. Q. And the name of the person to whom it was issued? — A. Yes sir. Q. And the amount issued? — A. Yes sir. Q. Now, Mr. White, your office is the custodian of all those trans- fer books ? — A. Of the Standard Oil Company of New Jersey, yes sir. Q. And have you the books from the beginning of the organization of the Standard Oil Company of New Jersey?— A. From 1882? Q. Yes sir. — A. I cant say now without looking into it. Q. You would naturally have, wouldnt you ? — A. Presumably so. Q. Has your office the transfer books of the Standard Oil Trustees and the Liquidating Trustees? — A. No sir. Q. How do you know? — A. I have every reason to believe. I be- lieve that they are not in my office. Q. Have you looked to see? — A. I have. Q. You have examined? — A. Yes sir. Q. They are not there ? — A. No sir. Q. Do the books of the New Jersey Comxaany show what that stock was issued for ? — A. The New Jersey stock issued for ? Q. Yes sir. — A. It merely says original issue. 825 Q. Original issue? — A. Yes sir. Q. And to whom? — A. Yes sir. Q. When you issued that stock, on whose order did you issue it ?— A. That was before my day, sir. Q. Well, do the books show ? — A. I dont think they will. Q. Who was there as secretary before you? — A. Mr. L. D. Clark, I think, was assistant secretary. Q. Who was the secretary ? — A. I believe Mr. Pratt was. Q. Who preceded Mr. Pratt?— A. Mr. L. D. Clark. Q. As secretary ? — A. Yes sir. Q. And as assistant secretary, both ? — A. No sir. After Mr. Pratt was made secretarj^, Mr. L. D. Clark was assistant secretary, if I am not mistaken. Q. Mr. L. D. Clark was the secretary preceding Mr. Pratt? — ^A. I believe so. Q. Wlien did Mr. Pratt become secretary? — A. Why, I think it was in 1899. Mr. MrLBURN. I think we have the record. Q. June 18, 1899 ? — A. I should say in that neighborhood. Q. Mr. L. D. Clark preceded him ? — A. Yes sir. Q. You were not there in June, 1899 ? — A. No sir. Q. When did you commence? — A. As assistant secretary of the New Jersey? Q. Yes.— A. May 1st, 1900. Q. Did the Standard have an assistant secretary before June, 1899, when Mr. Clark was the Secretary? — A. I am unable to 826 state now. Q. How do you know that Mr. L. D. Clark preceded Mr. Pratt ? — A. I think the minutes that you have here will show that, of tlie Standard of New Jersey. WHITE. 405 Q. You have looked it up, have you ? — A. Yes sir. Q. Were you in the employ of the company at all, or any of the companies, prior to May 1, 1900?— A. I was in the employ of Mr. Wade Hampton. Q. In the auditor's department ? — A. Yes sir. Q. You were one of his auditors ? — A. Yes sir. Q. Engaged in what part of the business? — A. Auditing the ac- counts of companies that he designated me to. Q. During the period of the Trustees? — A. Yes sir. Q. And the Liquidating Trustees? — A. May I ask — you say dur- ing the period of the Trustees ? Q. Yes, the Standard Oil Trustees. — A. Between what periods? Q. That is, from 1882; you were in the employ of Mr. Wade Hampton? — A. No sir, not until 1890. Q. You commenced in 1890 ? — A. Yes sir. Q. From 1890 to 1900 you were in the employ of Mr. Wade Hampton? — A. Yes sir. Q. And auditing various of the accounts of the various com- panies? — A. Yes sir. Q. Did you audit any of the accounts of the Trustees? — A. No sir. 827 Q. Of the Liquidating Trustees?— A. No sir. Q. You never did? — A. No sir. Q. How did you know that Mr. Hampton was in the employ of the Trustees as auditor? — A. I didnt know. Q. You didnt know that? — A. No sir. Q. You just said that you were there during the period of the Trustees. — A. I did. Q. What?— A. I did. Q. You knew there were trustees? — A. Yes. Q. And you knew there were liquidating Trustees? — A. From hearsay. Q. And you knew there were Trustees' certificates outstanding? — A. Yes, I presume so. Q. Well, you were generally familiar with that fact, werent you? — A. I think I can say so. Q. Did you know Mr. John Bensinger? — A. I have a speakkig acquaintance with him, yes sir. Q. How long have you known him? — A. I think I met him in 1900. Q. Did you know him before that? — A. Why, I couldnt say; I may have. Q. He left the employ of the company in 1900; you knew him before he left the employ of the company, didnt you? — A. A very short time. Q. What was his business? — A. Well, I couldnt answer that. Q. You dont know? — A. No sir. Q. How did you happen to meet him. A. I cant recall that. 406 WHITE. 828 Q. You dont know?— A. No sir. Q. You dont know what office he was in? — A. I first met him in Room 1401, I believe. Q. Whiit was that office, 1401 ? — A. I suppose it was the transfer office. Q. Yes; of the Trustees? — A. I presume so. Q. And Liquidating Trustees? — A. Yes sir. Q. And John Bensinger was the transfer agent and kept the books, was he not? — A. I understand so. Q. You understood that at the time? — A. I think so. Q. And you understood that was the transfer agent's office? — A. Yes sir. Q. Now, when you took hold in 1900, as the transfer agent, did you open the set of books? — A. No sir, they were opened. Q. Who had opened them ? — A. I cant say that. Q. Did you know the writing of the man who had opened them ? — A. No, I couldnt say that. Q. How long had they been opened? Mr. MiLBTJRN. You are talking about the transfer books of the Trustees ? Witness. No, of the Jersey. Mr. MiLBURN. Of the New Jersey. Mr. Kellogg. He understands. Witness. I presume they were opened about June, 1899. Q. Well, do you Imow? — A. Not without reference to them, no sir. Q. What became of the old transfer office? — A. I dont know. 829 Q. You dont know?— A. No sir. Q. Are the original transfer books that you commenced work on there in your office now? — A. They are in Bayoime. Q. Dont you keep them in New York? — A. We have a duplicate set in New York. Mr. MiLBURN. By the law of New Jersey the stock books have to be kept there. Q. The duplicate set is in your office now? — A. Yes. Q. Showing its original opening? — A. Yes sir. Q. Of the books? — A. Yes sir. Q. You dont laiow what became of the transfer books in 1401 ? — A. I havent the remotest idea. Q. Who succeeded Mr. John Bensinger in that office? — A. Who succeeded him? Q. Yes. — A. Why. I dont know who succeeded him. Q. You dont?— a'. No sir. Q. Well, didnt you ever see anybody in 1401 after he left? — A. When did Mr. Bensinger leave? Q. 1900. — A. Well, then, I succeeded him. Q. You succeeded him? — Yes sir. WHITE. 407 Q. That is what I thought. — A. Not as transfer agent excepting of the Standard of New Jersey. Q. Yes, bnt yon went into the same room, did you? — A. Yes sir. Q. And occupied the same office? — A. Yes sir. Q. And it has a vault, has it? — A. Yes sir. 830 Q. Were there any papers and books there when you went there? — A. Yes sir. Q. What papers and books? — A. Well, there were the certificate books of the Standard Oil Company of New Jersey, the journal, and the ledger. Q. Were there no other books there? — A. In another vault there may have been. Q. There was another vault there, was there? — A. Another safe, rather. Q. Another safe? — A. Yes sir. Q. You had access to that, had you? — A. No sir. Q. That was locked up? — Well, I cant say that; I didnt have access to it. Q. Who did ? — A. I dont know. It was taken from my office. Q. Did you go in when Mr. Bensinger went out ? — A. I presume so, yes. Q. Well, when he went out he turned over the books to you, didnt he ? — A. Of the Standard Oil Company of New Jersey. Q. He turned over the Standard's of New Jersey books? — A. Yes sir. Q. You took charge of the office, did youv?'cr^A. I did. Q. And of all the papers in the office? — A. Not necessarily. The papers of the Standard Oil Company of New Jersey. Q. I dont want to laiow " necessarily " ; I want to know whether you did at all or not. — ^A. I did not. 831 Q. What books and papers were there in the office that you didnt take charge of? — A. Whatever may have been in that safe that I mentioned. Q. That safe you have never looked into? — A. Yes sir, I have looked into it. Q. Is it there now ? — A. I dont think it is. Q. When was it removed ? — A. Within a month or two of the time I went in there. Q. That safe was taken out ? — A. Yes sir. Q. With the papers in it ? — A. That I cant say. Q. You never looked into it ? — A. I did not. Q. Did Mr. Bensinger tell you what papers he turned over to you? — A. No sir. Q. Who did ?— A. No one. Q. He simply stepped out and you stepped in ? — A. I did. Q. You knew he had been the transfer agent of the Trustees, didnt you? — A. I did. Q. And kept the books ? — A. Yes sir. Q. And you said nothing to him about it ? — A. I did not. 408 WHITE. Q. Or he to you ? — A. Nor he to me. Q. And you never inquired what was in that safe ? — A. I did not. Q. And they removed it within a month or two? — A. I should say within a month or two. Q. With the papers that were in it ? — A. Yes, sir. Q. You never saw what was in it? — A. No sir. 832 Q. And you swear that at the time you went there, unless they were in that safe, there were no transfer books of the Trustees or the Liquidating Trustees in that office ? — A. I do. Q. Did you look at the time to see?— A. Did I what? Q. Did you examine at the time to see? — A. No, I did not ex- amine, but I feel assured that there were none. Q. How do you know there was not?— A. Well, I don't know. I feel assured — naturally sure. Q. There were no such papers there? — A. Yes sir. Q. Did he explain to you in what safe you would find your trans- fer books and other papers that he turned over to you ? — A. Of the Standard of New Jersey ? Q. Yes.^ — A. No sir. Q. Didnt he show you anything about the transfer office at all?— A. Not to my recollection. Q. Didnt anybody? — A. Possibly so, yes sir. Q. Had you ever kept transfer books before ? — A. No sir. ' Q. Well, who did explain to you how to keep them? — A. Why, I think possibly — How to keep them ? Q. Yes. — A. I didnt need any explanation. Q. You didnt?— A. No sir. Q. Well, who explained about the books to you ? — A. I dont know that anybody did. Q. Well, what did you mean by you think possibly ? You started to say you thought possibly somebody A. Told me of the exist- ence of books? 833 Q. Yes. — A. I think possibly it was Mr. Hampton. Q. What did he know about them? — A. I dont know what he knew. Q. He hadnt charge of the transfer office, had he? — A. No sir. Q. Mr. Bensinger had? — A. Of the old transfer office, I presume, yes sir. Q. Was this a large safe or a small safe that had these books? — A. Quite a good-sized safe. Q. When they took the safe out was it opened ? — A. I cant say. Q. Who took it out? — A. I dont know that. Q. Who directed taking it out ? — A. I dont know that. Q. You made no inquiries as to what was in it? — A. I did not; none whatever. Q. And you have searched your office for those transfer books, have you? — A. I have. Q. And cant find them? — A. I can not. WHITE. 409 Q. When did you search? — A. I have searched within two or three weeks after receiving my subpcena. Q. Have yon inquired of anybody ? — A. I have. Q. Who ? — A. I have inquired from Mr. Tilford. Q. W. H. Tilford?— A. Yes sir. Q. What does he say ? — A. He doesnt know where they are. Q. Did you inquire of anybody else ? — A. No sir. Q. For instance, an original issue of stock of the Standard Oil Company of New Jersey, issued after you came there, would be de- livered to the party or the attorney of the party receiving it; that is, in whose name the stock was issued, wouldnt it? — ^A. May 83+ I ask you to repeat that, Mr. Kellogg? I dont quite catch it. Q. 1 will change the form of the question. The original issue of stock by the Standard Oil Company of New Jersey, had to be delivered on somebody's order, hadnt it? — A. Yes sir. Q. You wouldnt issue A. Not a written order. Q. Well, I know, but you would not issue ninety-seven millions of stock as an original issue without somebody's ordei', would you ? — A. I presume not. Q. Now, there was issued in 1899 and 1900 over ninety millions of that stock as an original issue, wasnt there? — A. Yes sir. Q. On whose order did you issue that? — A. I presume on the comptroller's. Q. You presume on the comptroller's order? Do you know? — A. I think T can say I know. Q. Was it on the comptroller's order? — A. Yes sir. Q. And who was comptroller? — A. Mr. L. D. Clark. Q. Did you have any written order? — A. No sir. Q. None whatever? — A. No sir. Q. How did he manage that? Did he come in and tell you to issue a certificate for one million or two millions, or about that ? — A. He stated to me that stocks had been transferred to the Standard Oil Company of New Jerse}'^ in line with the resolution that had been adopted by the board of directors, and that I was authorized to issue so many shares of this common stock of the New Jersey Company. Q. Then, you do know that the stock was issued for the 835 stock of the companies which had previously been in the Trustees, dont you ? — A. A very few shares I do. Q. And you know that it was issued pursuant to that resolution? — A. Yes sir. Q. Which recited the names of the companies?— A. les sir. Q. And Mr. Clark gave you the orders to whom to issue it?— A. Yes sir. Q. Did you ever see a Trustees' certificate?— A. Yes sir. Q. And a Liquidating Trustees' assignment ?— A. Yes sir. Q. Where did you see them? — A. Around the market. Q. Did you ever see them in your office? — A. I dont think I have. Q. You never saw one there? — A. Not to my recollection. 410 WHITE. Q. Were there any such certificates in your office when you went there? — A. Unless they were in that safe. Q. Unless they were in that safe. Did Mr. Clark order the removal of that safe? — A. I dont know who did. I have no idea. Q. You have no recollection? — A. I never knew. Q. You never knew ? — A. No sir. Q. You dont know how it came to be taken out, then ? — A. No sir. Q. Other than some men came there and carried it out? — A. I pre- sume so. Q. Where did they put it? — A. I dont know. Q. Anotl.er safe put in the place of it? — A. Yes sir. Q. The same size? — A- A larger safe. Q. All the books you needed were in the other safe, werent they ? — A. In what other safe? 836 Q. You said there were two safes there. — A. There are two or three safes in my office. Q. Did you need a larger safe ? — A. I thought so, yes sir. Q. Was that the reason it was taken out ? — A. The old safe ? Q. Yes. — A. I dont think so. Q. You dont think so? — A. I dont think so. I never used it. Q. You never used it; you never saw it opened? — A. Well, I cant say that. It may have been opened. That is so far back that I cant recall circumstances of that kind, Mr. Kellogg. Q. Well, how do you recall, then, it was taken out about thirty days after you went there? — A. Because, I think I said, there was no use of it in my office. Q. Having books in it that you had no access to. Did you consider it strange that you had no access to it? — A. Not at all. Q. But it attracted your attention, so that you remember it. — A. Well, I would naturally remember a safe of that size. Q. Going ovit ? — A. Yes sir. Q. Well, then, wouldnt you naturally inquire why it was taken out? — A. Not necessarily. Q. Well, now, you got no written orders to issue this original issue of stock to certain particular persons, did you? — A. No sir. Q. Mr. L. D. Clark would come in and tell you to issue stock and deliver it to certain individuals, would he? — A. Yes sir. Q. Over ninety millions of stock? — A. Yes sir. 837 Q. How much? — A. A very few hundred shares. Q. Only a fcAv hundred shares. Well, a few hundred shares, then, and delivered it? — A. Yes sir. Q. On tlie verbal order of Mr. Clark? — A. Yes sir. Q. Most of it had been issued before you came there? — A. Yes sir. Q. By whom had that been issued, do you know? — A. By whom? Q. Yes; j\Ir. Censinger? — A. I presume so. I cant answer that. Q. Well, did you know the handwriting of the man who kept the books? — A. The certificates I think you will find in the handwriting of several individuals. WHITE. 411 Q. How about the stock ledger and journal? — A. That, I think, will be in the handwriting of one or two. Q. How did you happen to inquire of Mr. Tilford, of the Stand- ard Oil of New Jersey, if he knew where the books were ? — A. From the fact that I understood he was one of the Liquidating Trustees. Q. You understood there were others, didnt you? — A. Yes sir. Q. Who were they ? — A. That I cant say, all of them, except as I have seen in the newspapers. Q. Well, who were they as you understood ?— A. I think Mr. Archbold was named. Q. Did you inquire of Mr. Archbold ?^-A. I did not. Q. Who" else?— A. Mr. Flagler. Q. Did you inquire of Mr. Flagler ? — A. I did not. 838 Q. Who else was a Liquidating Trustee? — A. I couldnt tell from memory. Mr. MiLBtiEN. Well, Mr. John D. Rockefeller was. Q. I presume you didnt inquire of Mr. John D. Rockefeller? — A. I certainly did not. Mr. MiLBUEN. Mr. Williams? Witness. I certainly did not. Mr. MiLBUEN. Mr. Pratt testified he didnt know where they were. Q. Did you inquire of Mr. Henry H. Eogers? — A. I did not. Q. You simply inquired of Mr. Tilford? — A. Yes sir. Q. Do you know Mr. Archbold? — A. I do. Q. He is in the office of the Standard Oil Company every day, isnt he, nearly ? — A. Yes sir, pretty nearly. Q. And was a Liquidating Trustee? — A. So I am told. Q. You didnt inquire of him? — A. I inquired of the first man I happened to meet. Q. That was Mr. Tilford ?— A. Yes sir. Q. What did Mr. Tilford say? — A. He said he had no knowl- edge of the existence of them. Q. Well, he said the same thing here. — A. I am glad I substan- tiated his statement. Mr. MiLBUEN. So he was consistent, eh! Q. Do you know whether Mr. Clark gave the order for the re- moval of that safe ? — A. I dont know, Mr. Kellogg. Q. Or Mr. Hampton? — A. I dont know. 839 Q. You could make up a statement showing the original is- sue of stock by the Standard of New Jersey in 1899 and 1900, and the amount issued and to whom issued, and the date of issue, couldnt you ? — A. I think T have made up such a statement for you. Q. You have made up a statement of the total amount issued in 1899. I show you Petitioner's Exhibit 17. I think that is it.— A. No, I made up a statement showing the shareholders. Q. No, I have the present shareholders, but I havent a list of the parties to whom stock was issued in 1899. Did you make up such a statement? — A. I did. 412 STEINBKENNEE. Q. Then, I would like that. — A. All right, sir. Q. I have never seen that statement. That is 1899 and 1900 ? — A. Yes sir. Q. And did that include 1901 and 1904?— A. I think it did, I cant say. Q. Well, that is the original issues of stock ? — A. Yes ; I am pretty sure I have made that statement up, Mr. Kellogg. Q. I would like that statement. That statement showed the origi- nal issue, to whom issued, the date of issue ? — A. And the number of shares. Q. And the number of shares ? — A. Yes sir. Mr. Kellogg. That is what I asked. Mr. MiLBUEN. I think that was asked of Mr. Tilford when he was on the stand. Witness. That is my impression, but I would not be sure. Mr. MiLBUEN. I will run it down. 840 Mr. Kellogg. I think that is all I wish to ask the witness. No cross-examination. Mr. Kellogg. Mr. Rosenthal was going on the 3 :30 train, and didnt wish any other witness called this afternoon, and so I am willing that we take an adjournment. The Examiner. I think it was announced that it would be for the convenience of all parties to take an adjournment until Thursday. The hearing is therefore adjourned until Thursday, October 3, 1907, at 10:30. 841 Thursday, October 3, 1907. The hearing was resumed before the Special Examiner at 10 : 45 A. M. C. C. Steinbrbnnee, called as a witness on behalf of Petitioner, being duly sworn, testified as follows : Direct-examination by Mr. Kellogg: Q. What is your full name? — A. C. C. Steinbrenner. Q. What is your position with the Galena Signal Oil Company ? — A. I am the auditor of the railway department. Q. How long have you been? — A. About 14 years. Q. Are you familiar with the railway contracts for the lubricating oil supplied by the Galena Signal Oil Company? — A. Yes. Q. And the predecessor companies, the Galena Oil and the Signal Oil companies? — A. Yes. Q. What companies connected with the Standard Oil Company, so far as you know, sell lubricating oils in this country to railroads? — A. The Waters-Pierce Oil Company, so far as I know. Q. Yes.— A. That is all. Q. And the Galena Signal Oil Company? — A. And the Galena Signal. Q. At the present time ? — A. Yes. 842 Q. Does Swan & Finch sell to two railroads? — ^A. Yes; they act as our agents. STEINBBENNEE. 413 Q. For two railroads? — A. Yes. Q. Do you remember those railroads ? — A. The Maine Central and the Boston & Maine. Q. Swan & Finch is a Standard Oil Company ? — A. I don't know. Q. You don't know «— A. No. Mr. MiLBUEN. The record shows already. Q. No other companies that you know of connected with the Standard Oil sell lubricating oils at the present time ? — A. No. Q. Now, the Waters- Pierce Company only sell in certain territory ; isn't that true ? — A. That is true. Q. Do you know what that territory is? — A. I couldn't define it, no. Q. Well, generally speaking, it is Southern Missouri, Arkansas, Texas, Louisiana and Mexico, isn't it? — A. That is about it, I think. Q. The Waters-Pierce, so far as you know, does not sell generally outside of that territory? — A. No. Q. Did the Vacuum Oil Company use to sell lubricating oils to railroads ? — A. I don't know. Q. You don't know as to that? — A. No. Q. I show you a paper, schedule, which the stenographer will please mark as an exhibit. Same marked Petitioner's Exhibit 117. 843 Q. Was that prepared by you or the Galena Signal Oil Company, at our request? — A. Yes sir. Q. Wliat is that statement? — A. It is a list of certain contracts, giving the terms, that we have with certain railroads. Q. This is a list of the contracts covering the time and corre- sponding with the calendar years of 1904 and 1905, or some parts of those years? — A. Yes. Q. Giving the railroads and the length A. And the period. Q. And the period of the contract ? — A. Yes. Q. At the head of this statement I find that certain initial prices are given. Well, I guess I will take them from the contracts. This does not include those railroads to which the Waters- Pierce sells ?^ A. No. Q. Where does the Waters-Pierce Company get its lubricating oils ? — A. From the Galena Signal Oil Company. Q. You sell them to the Waters-Pierce? — A. For railroad pur- poses. Q. For railroad purposes, I understand. Does the Waters-Pierce Company return the contracts to your office? — A. They do not. Q. Or any statement of them ?— A. No sir. Q. They keep the details of those contracts in their own office ?— A. Yes. Q. At St. Louis?— A. At St. Louis, I think. Q. Does your auditor check up those contracts and prices?— A. No. 844 Q. Do you know whether any auditor of the Standard Oil Company does ? — A. I do not. 414 STEINBKENNEE. Q. No statement is made to you as to those contracts? — A. No. Q. Can you tell from memory what roads they sell to? — -A. No, I dont remember. Q. You sell them the oil at a fixed price? — A. Yes. Q. Do you know what it is? — A. Just the same as we sell to the railroads. Q. Well, do you mean that you sell them oil at the invoiced price that you sell to the railroads ? — A. Exactly. Q. On what basis do they settle with you, then? — A. They have a commission. Q. What commission? — A. I dont know the rate. Q. You dont know the rate of commission ? — A. No. Q. In other words, the oil is sold to the' railroads on an invoice price? — A. Yes. Q. And the oil is sold to the Waters-Pierce Company on the same invoice prices? — A. Yes. Q. The railroads settle for the oil at the end of each year, or a definite period, on a basis of the cost per thousand mile run of engines and cars? — A. I dont know how the railroads settle with the Waters- Pierce Company. Q. Well, with your company? — A. With our company, yes. 845 Q. Now does the Waters- Pierce settle with you? — -A. They pay our invoices. Q. And make no refund ? — A. And make no refund. Q. You don't know what the commission is? — A. No. Q. Well, if the Waters-Pierce make a refund to the railroads out of that invoiced price, it would be a loss to them, unless they got it out of their commissions or some other way, wouldnt it? — A. I dont know how that would work out, Mr. Kellogg. Q. Well, you know that the Galena collects A. The full in- voice price. Q. The invoice price from the Waters-Pierce Company? — A. Yes. Mr. Kellogg. I offer in evidence Petitioner's Exhibit 117, the list of railroads. Q. Now, what percentage of the railroad mileage in the United States does the Galena Signal Oil Company, the Waters-Pierce Com- pany, and Swan & Finch Company, collectively, sell in the United States? — A. Without having any statistics on the subject, I would say about 95 percent. Q. Will you give me a letter written by Charles Miller to Mr. D. F. Maroney, Vice President of the Pittsburg, Shawmut & Northern Railway, on February 23, 1905, making a contract with that company, in which Mr. Miller states the percentage that the Galena Signal Oil Company buys. You can pick it out. 846 (Witness hands paper to Mr. Kellogg.) Q. I show you a letter written by Charles Miller to D. F. Maroney, Vice President of the Pittsburg, Shawmut & Northern Rail- way, February 23, 1905. Is that signed by Mr. Charles Miller, the STEINBEENNER. 415 president of the Galena Signal Oil Company? — A. That looks like his signature. Q. You know his signature'^ — A. Yes. Mr. Kellogg. I offer this in evidence, and, as it is short, to save copying it, I will read it into the record : " Galena Signal Oil Company, Franklin, Pa., February 33, 1905. OiSce of President. P Contract File No. 19. Mr. D. F. Maeonet, Vice Preset. Pittshin'ff, Sha-wmut & Northern Ry. St. Marys, Pennsylvania. Dear Sir : As you are aware, we are supplying 97^- % of the total railway mileage of the United States, Mexico and Canada with our oils, and it must necessarily follow that the railway managers of the various railways in the country who have used our oils (some of them as long as 30 years) have found merit in the same and use them exclu- sive of all other oils, because, first, they are known as the best lubri- cant for railway purpose; secondly, by their judicious use they are more economical than any other oils, giving better lubrication 847 which means less friction, hence, less power required to haul trains, and therefore, a saving of machinery and bearings. We would be very glad indeed to furnish you with our oils, and hereby agree that the prices which we name shall be as low per gallon as we are giving to any other railroad in the country. We will deliver the oils to any point upon your railway that you may designate, at the following prices : Galena Engine Oil, 30^ per gallon. Galena Car Oil, 20^ per gallon for both pass and freight cars. Sibley's perfection Valve Oil, 50(f per gallon. Perfection Signal Oil, 360 per gallon. We will also agree to take all good empty barrels from you and allow you $1. per barrel, delivered at Franklin. If at any time during the period you purchase these oils, we reduce the price of any one of our oils to any railway, your railroad shall re- ceive a like i-eduction. After you have completed the construction work which you have under way to connect your road at the different points, we will agree to enter into a contract with your company should you so desire, for a term of years, and will guarantee the cost per thousand miles, not to exceed the lowest point at which, during the trial we may be able to reduce the cost on locomotives, passenger and freight cars. You to use the oils at least a year, in order that you may ascertain what can be done toward reducing the cost to the lowest possible point, based on the ^'alue of Galena oil. 848 We shall be pleased at any time to assist you in any way possible to reduce the cost to the lowest point, giving you such 416 STEINBRENNEK, suggestions from time to time that will result in the most economical and practical use of these oils. Very truly yours, Charles Miller, President. E. W. Grieves." Q. "What and who is E. W. Grieves ? — A. Agent of our company. Mr. Kellogg. (Reading.) "Accepted: D. F. Maroney, Vice Presi- dent PittsbTU'g, Shawmut & Northern Ey." Q. Mr. Miller was in direct charge of the business of the company, was he not? — A. Yes. Q. You have not made a computation of the mileage furnished by the Galena Company, you say — a definite computation? — A. No. Q. But your estimate was about 95 per cent? — A. I should say so, yes. Q. Do you know of any railroads which are furnished by any other lubricating company? — A. Yes. Q. What are they ? — A. The one that I recall now is the Tidewater. Q. The Tidewater? — A. The Tidewater, about 400 miles, and some other smaller lines that I can't recall. Q. The Tidewater line is owned by Mr. H. H. Rogers, is it ? — A. I think so, as I understand it. Q. He px'obably thinks he can get better oil from somebody else ? — A. Well, he may get a larger profit out of them. ^ 849 Q. Do you know of any other railroads? — A. There are numerous railroads, smaller lines, that I can't recall. Q. No prominent railroad in the United States, is there ?-r-A. Not any large system that I know of. Q. The Tide-water roads run from Norfolk, is it? — A. I don't know where it runs. Q. Well, it is a road being constructed down in Virginia some- where, isn't it? — A. I presume so. Q. Mr. H. H. Rogers owns it and controls it, doesn't he? — A. I understand he has an interest in it. Mr. MiLBtJRN. That is it ; you have got that now. That is where it bears on this case. Mr. Kellogg. It is very important. Witness. In connection with that, I should like to say that we have made a proposition to the Tidewater on several occasions to lubricate their equipment at 90 per cent of their previous cost that they had established, and for reasons we have not been able to secure that contract. Presumably they are using other oils in which Mr. Rogers may be interested. He gets possibly a larger profit out of it than he would out of their proportion of Galena Signal oils. Q. You have produced, at our request, the contracts with the vari- ous railroads, in force during the years 1904 and 1905, or a part of those years ? — A. Yes. STEINBRENNBR. 417 Mr. Kellocg. It is not our wish to encumber the record with all these contracts, but to introduce some of them showing the general form. 850 Q. I show you, therefore, a contract or contracts entered into by the Baltimore & Ohio Eailroad Company with the Galena Signal Oil Company, which I will ask the stenographer to mark. Each one of the papers will be the same exhibit. The papers were marked Petitioner's Exhibit 118-A to 118-F in- clusive. Q. I show you Petitioner's Exhibit 118-A to 118-F, including the correspondence. Are those the contracts with the Baltimore & Ohio road which were in existence during 1904 and 1905 ? — A. Yes. Q. Now, the printed contract, dated 1905, is that your standard printed contract, Mr. Steinbrenner * — A. Yes. Mr. Kellogg. I want to ask you some questions about the printed form of contract, and, Mr. Crawford, if you will just give him one of the others so that he can hold it in his hand. Having it in your hand, you might be able to answer more accurately (handing witness paper). I notice in these contracts, Mr. Steinbrenner, a large num- ber of them are now printed? — A. Yes. Q. How long have you used the printed form? — A. Some five or six years, possibly. Q. In this Baltimore & Ohio contract, the oil prices are given as follows : Perfection Valve oil for steam locomotives, valves and cyl- inders 48 cents in tank cars, (per gallon, that is,) 50 cents in wooden barrels ; Galena engine oil for steam locomotives, machinery, 28 cents, in tank cars, and 38 cents in barrels ; Galena coach oil for passenger ciirs, 33 cents in tanks, 35 cents in barrels; Galena car oil for 851 freight cars hauled by steam locomotives 16 cents in tank cars, '20 cents in wooden barrels. Is that your standard, universal invoice price? — A. Yes. Q. To get at that clearly, you mean by invoice price what? — A. What we bill the oil to the railroads at. Q. And that price is uniform to all the railroads in the United States, excepting additional freight in certain territory? — A. Yes. Q. Now, please state what that territory is, and what the addition is. That is, for oil delivered in what territory? — A. Within the zone of New York and Chicago, and south as far as Cincinnati and Washington. Q. That is, within the territory from the Atlantic Seaboard to Chicago A. Chicago. Q. And north of Washington and Cincinnati? — A. Or to points where the freight is equivalent to those points. Q. And to points where freight is equivalent to those points?— A. Yes. Q. You delivered the oil to railroads at any place within that ter- ritory at those invoice prices ? — A. Yes. 3255.5—08 27 418 STEINBEENNER. Q. Does that include the great majority of the railroad mileage in the United States? — A. I could not say as to that. There is a large mileage outside of that zone. Q. Yes, west of Chicago many of the trans-continental lines have terminals at Chicago, havent they? — A. Yes. Q. And they receive their deliveries at Chicago? — ^A. At Chi- cago. 852 Q. South of the Ohio river and Washington, many of the railroads reach the Ohio river and Washington, do they not? — A. Yes. Q. And they receive their deliveries at those points. Notably among those the Southern Railway? — A. Yes. Q. The Louisville & Nashville Railway? — A. Yes. Q. The Atlantic Coast Line?— A. No. Q. Not the Atlantic Coast Line? — A. No. Q. The Norfolk & Western? — A. They receive their oils at Co- lumbus, Ohio, I believe. They reach Columbus, Ohio. Q. Then they would receive them at these invoice prices ? — A. Yes. Q. And the lines west of Chicago, the Santa Fe reaches Chicago ? — A. Yes. Q. The Rock Island reaches Chicago ? — A. Yes. Q. The C. B. & Q. reaches Chicago? — A. Yes. Q. The Chicago & Northwestern reaches Chicago? — A. Yes. Q. The Milwaukee & St. Paul reaches Chicago? — A. Yes. Q. The Chicago Great Western reaches Chicago? — A. Yes. Q. And all those lines receive Chicago delivery? — A. Chicago delivery. Q. At these invoice prices? — A. Yes. Q. You would say, then, that the majority of the mileage is fur- nished at these invoice prices? — A. I would think so, yes. Mr. MiLBUEN. Do you charge freight to the New England States? 853 Witness. Yes. Mr. Kellogg. Oh, T didn't know that. Explain that. What companies in New England ? — A. The Central Vermont ; I am not sure as to any others. I can't recall now. Q. Does the New Haven & Hartford receive at these invoice prices? — A. Yes. Q. And the Boston & Maine? — A. I am not sure as to the Boston & Maine now, whether they get their oils at Boston or New York delivery. Q. I will just look at the contract. I show you the Boston & Maine contract. The delivery there is at Boston for the invoice price and the two cents extra is for the barrels, is it not ? — ^A. Yes. Q. So the Boston & Maine system gets theirs at the invoice price, no freight added? — A. I think so. Q. Now, west of Chicago, where you ship oil and make deliveries at any point west of Chicago, or south of the points you named, STBINBEENNER. 419 freight is added to the invoice price per gallon, isn't it ? That is, a certain number of cents per gallon is added for freight? — A. Yes. Q. Does that exactly equal the freight, or is it an estimate? — ^A. As nearly as possible it does equal the freight. Q. That is the extra freight over the freight to Chicago ? — A. Yes. Q. You deliver at Chicago at the same price you deliver at Franklin, Pennsylvania? — A. No, we make a Franklin price 854 to the Erie railroad. Q. I mean any place outside of Franklin? — A. Outside of Franklin, yes. Q. That is, you deliver at Chicago as cheap as you deliver at any point outside of Franklin? — A. Yes. Q. Then, at these other points you add a certain number of cents per gallon for the freight deliveries; that is, for the deliveries to cover freight? — A. Yes. Q. Now, how do you arrive at that? For instance, if you are going to deliver at New Orleans or Birmingham, or at Atlanta, or San Francisco, or any places of that kind? — A. That is arrived at by taking the weight at 400 pounds to the barrel, which I think is the usual practice on freight-carrying roads, taking 400 pounds to the barrel and the regular rate of freight, and then dividing it by the gallons to the barrel. Q. In any event, it would only be an approximation, would it? — A. Yes, as near as possible. Q. That is, you approximate, as near as you can, the number of cents per gallon per barrel? — A. Yes. Q. Because the amount the railroads will take in a year is not known to you? — A. No. Q. And as it is billed out you have got to estimate it — estimate the freight?— A. Yes. Q. And the freight may overrun or under-run the prices put in the contract. (No answer.) Q. That is, the allowance in the contract may exceed the actual freight they would have to pay ? — ^A. Not necessarily. 8.5.5. Q. No, I say it may. — A. We attempt to make a fixed price equivalent to the freight, beyond those fixed points of Chicago or New York. Q. Well then, the 48 cents, the 28 cents, the 33 cents and the 18 cents which you have named, in all cases represents the invoice price for payment of the oil ? — A. Yes. Q. And anything added is either for barrels or freight?— A. Yes. Q. And the freight of necessity is an approximation ?— A. Yes. Q. Now, your contracts, some of them are printed and some of them are typewritten ; are the typewritten contracts generally sub- stantially the same as the printed contracts?— A. I think so. Q. That is, the general contract that you use with the railroads, with the exception of prices, guarantees, and some special clauses which may be added, are substantially in the same form ? — A. Yes. 420 STEINBRBNNEB. Q. There are some contracts which vary? — A. Yes. Q. But as a general thing, you aim to use and do use a uniform contract ? — A. Yes. Q. Section 3, I wish to call your attention to, and I will read it: " The first party agrees that should any reduction be made in the in- voice prices named in Section 1 for the same quality of oils to any other railroad during the period covered by this contract, the 856 second party hereto is to receive the benefit of a like reduc- tion." This is the part I wish to call your attention to: " Should the price of Franklin crude oil decline 2.5 cents per barrel of 42 gallons, below $3.90 per barrel, the invoice prices in Section 1 for Galena engine, Galena coach and Galena car oils will be reduced I cent per gallon for every such decline in the price per barrel of said crude oil." '^'\'Ti}' is that put in there? Mr. Rosenthal. The latter part? Mr. Kellogg. Yes, the latter part I pai-ticularlj' referred to. Q. The part in lelation to the reduction, " Should Franklin crude oil decline 25 cents per barrel below $3.90 per barrel," why was that part of the clause put in the contract? — A. I presume it was done as it was the base of Galena oils. Q. That is, Franklin crude being the basis of the Galena oils? — A. Yes, of the three classes mentioned in that paragraph. Q. Have j^ou ever known of any reduction being made on that ac- coimt? — A. No. Q. In fourteen years you know of no reduction made to the rail- roads on account of that paragraph? — A. No. Q. The Franklin crude oil is not the basis of the oil furnished to the railroads, to any extent ? — A. I don't know. Q. Isn't it a fact that an exceedingly small percentage of the lu- bricating oil for railroads is made out of Franklin crude? — A. I don't know. Q. You don't know anytliing about that? — A. No. Q. Who would know about that? — A. I jjresume the manu- 857 facturing deioartment would know. Q. Who are the men in the manufacturing department? — A. George C. Miller is our Superintendent of Works. Q.. George C. Miller is the Superintendent of the Works? — A. Yes sir. Q. Mr. Charles Miller is President ?— A. Yes sir. Q. Mr. Charles Miller Avould know, wouldn't he? — A. I sup- pose so. Q. I will pass that. You live in Franklin, do you not? — A. Yes sir. Q. Don't you know, in a general way, what the total production of Franklin crude is? — A. No sir. Q. How many barrels of lubricating oil do you make and sell in a year? — A. T would think about five to six hundred thousand a year. Q. Five to six hundred thousand barrels of lubricating oil?— A. Yes. STEINBRENNEK. 421 Q. Which you sell to railroads ? — A. Yes. Q. That is, of 42 gallons or 50 gallons? — A. That is of 50 gallons. Q. The crude oil, I understand, is 42 gallons? — A. Yes. Q. It is so stated in this. Now, don't you know that the produc- tion of Franklin crude does not exceed about 40,000 barrels a year ? — A. I do not. Q. I notice in this contract that under Section 4 you guarantee to the Railroad Company that the average cost to a company for lubri- cating its equipment per 1,000 miles run shall not exceed for 868 locomotives $1.75 ; for passenger cars 10 cents ; for freight cars 7 cents. I am now using the Baltimore & Ohio contract as a form. Wherever these contracts do contain that guaranty, is that the basis on which your company finally settles at the end of the year ? — A. Yes. Mr. Rosenthal. Wliat page of the contract? Mr. MiLBURN. Top of the second page. Q. That is, you figure up the total mileage of the locomotives, pas- senger cars and freight cars, and apply these figTires of $1.75 for each thousand miles the locomotive runs as the maximum cost to the railroad company? — A. Yes. Q. And you figure up the number of thousand miles the passenger cars have run and the freight cars, and apply these costs to that as the maximum cost to the railroad company? — A. No; the three classes are combined. Q. Well, I am going to ask you about that. You guarantee in this contract that $1.75 shall be the maximum cost which the railroad com- pany shall pay for running an engine a thousand miles? — A. Yes. Q. Very well. So you take the total number of thousand miles of all engines, and apply the $1.75 to it? — A. Yes. Q. And find out what the amount is the company should pay at $1 .75 per thousand miles run ? — A. That is true in a measure. Q. Yes sir. You have got to do that to determine whether the guaranty has been exceeded, or it is under the guarantee, haven't you? — A. The three must be considered together. We never con- sider Q. But you have first got to take the number of miles the loco- motives have run, haven't you ? — A. Yes. 859 Q. You have got to have a report from the railroad com- pany? — A. Yes. Q. You have got then to take the $1.75 as the guaranteed maxi- mum cost for each thousand miles every locomotiA'^e has run on that system of road ? — A. Yes. Q. And if the prices you have charged the railroad company in your invoiced price for engine oil exceeds that $1.75, you find out by calculation how much it exceeds it, dont you ? Mr. MiLBUEN. No. Witness. No. Q. Well then, how do you know whether the engine's run has exceeded $1.75 or has not?— A. We simply take the value of the 422 STEINBRENNER. oils consumed on all locomotives, all passenger cars and all freight cars combined, as against the guaranties of the three classes of serv- ices combined. Q. I am not asking you what you ultimately do. — A. That is the calculation all through the contracts. Q. I have asked you if you take and figure up the total number of miles all the engines on the system have run. — ^A. Based upon the mileage returned to us by the railroad. Q. Yes. Do you do that ? Then you find out whether the amount of oil used by the engines exceeds the guaranty or does not exceed the guaranty of $1.75?— A. ]!^o. Q. Then how do you know whether it exceeds $1.75? — A. We simply take the total of the three classes of service. We dont con- sider each class of service separately. Q. You have to find out — —A. Not necessarily, no sir. Q. How much the railroad should pay for its engine oil, dont you? — A. No sir. 860 Q. You dont?— A. No. Q. Then what is the use of putting a guaranty of $1.75 in ? — A. Because the railroads keep a separate account of the railroad mileage. Q. Why dont you have one guarantee that it shall cost the rail- road company so much for oil? — A. Because the railroads are re- quired to keep a separate account of the three classes of service. Q. You guarantee the Baltimore & Ohio that $1.75 shall be the maximimi cost for running an engine for 1,000 miles, dont you? — A. Taken into consideration with the passenger and freight car service. Q. Will you please answer that question, whether you find out whether the total cost to that railroad company of its engines ex- ceeds $1.75 or does not exceed it? — ^A. No. Q. You dont find that out? — A. No. Q. Will you tell me how you can find out whether the $1.75 has been exceeded, or whether it has not? — A. We simply consider the entire service. Q. Then you dont know whether it costs any single railroad, ia the United States $1.75 per thousand miles of its engines, or whether it costs it $4 ? — A. We do for another purpose. Q. That is what I asked you. You do actually know it?— Yes. 861 Q. As to every railroad? — A. Yes. Q. Then you do find out how much it costs them to run a locomotive a thousand miles, dont you? — A. We do for another purpose, yes, know that. Q. Well, I thought you did. Then you do keep statistics show- ing as to each railroad, where you have a guarantee, the maximum cost to that railroad, under that guarantee, of each separate serv- ice? — A. Yes. STEINBRBNNER. 423 Mr. Kellogg. I offer in evidence Petitioner's Exhibits 118-A to 118-F, if I have not already offered them. And it is stipulated that the originals may be returned to the Galena Signal Oil Company, and copies may be substituted with the same force and effect as though the original was left in evidence. And this may apply to all the contracts which we will offer. Mr. MiLBUEN. And it may also be noted, in the same connection, that this and other contracts you have offered were and are pro- duced by the Galena Signal Oil Company at j^our request? Mr. Kellogg. I have so stated. Papers marked Petitioner's Exhibits 119 to 130, inclusive. Q. I show you Petitioner's Exhibit 119. Are these the contracts of the Boston & Maine Railroad ? — A. Yes. Q. I show you Exhibit 120. Are these the contracts of the Wis- consin Central? — A. Yes sir. Q. And papers Exhibit 121; is that the contract of the Maine Central Railroad? — A. Yes. Q. I show you Petitioner's Exhibit 122; is that the contract of the Chicago & Northwestern Railway Company? — A. Yes. 862 Q. I show you Petitioner's Exhibit 123 ; is that the contract of the Chicago, Milwaukee & St. Paul Railway? — A. Yes. Q. I show you Petitioner's Exhibit 124. Are those two contracts the contracts of the Erie Railway Company? — A. Yes. Q. I show you Exhibits 125, 126 and 127; Are those the con- tracts of the Pennsylvania Company, lines east and west of Pitts- burgh? — A. Yes. Q. I show you Petitioner's Exhibit 128. Is that the contract of the Central of Georgia Railway Company? — A. Yes. Q. I show you Petitioner's Exhibit 129. Is that the contract of the Chicago, St. Paul, Minneapolis & Omaha Railway Company? — A. Yes. Q. I show you Petitioner's Exhibit 130. Does that constitute the contracts with the Union Pacific and allied companies? — A. Yes. Mr. Kellogg. I offer these contracts in evidence. Petitioner's Ex- hibits 119 to 130, inclusive. And it is stipulated between counsel that copies may be substituted in lieu of the originals in the same manner as the former. Q. The New York Central contract for 1904 and 1905 you do not seem to have. — A. I can't find it among those contracts there. Q. Well, the New York Central has now, or did have — you were furnishing it at that time, I suppose, under some previous con- tract. — A. In 1904 I think we did. 663 Q. Now, you have a regular standard printed contract? — A. Yes sir. Q. The New York Central in 1905, under its contract, paid the full invoice price, did it not? — A. I think so. Q. That would be 48 cents for valve oil, 28 for engine oil, and 18 cents for car oil? — A. They received a special oil, and one of those prices varied, I think. 424 STEINBRENNEB. Q. "Well, substantially they paid the full contract price? — A. Substantially, yes. Q. That Avas a special coach oil, wasn't it, instead of the one I have named? — A. A special coach oil, or special engine oil; I don't remember which. Q. They substantially paid the contract price in 1905? — A. Yes. Q. Of the ones I have named? Mr. MiLBtuN. The invoice price. WiT>'ESS. The invoice price, j'es. Q. Now, the Pennsylvania Company, east of Pittsburgh, paid subtantially one-half of that, didn't they? — A. They paid our in- voiced prices, less a refund as to excess Q. You refunded to the Pennsylvania about one-half of that price? — A. If I recollect, that is about right. Q. I show you the figures so you can state about what you did re- fund to the Pennsylvania Company (handing witness papers). — A. The Pennsylvania lines east, about 44 per cent, we re- funded. 864 Q. Will you look at the several statements so as to include all kinds of oil. — A. This is Pennsylvania lines east. Q. How about Pennsylvania lines west? — A. The Pennsylvania lines west, P. F. W. & C. Division Q. Pittsburgh, Fort Wayne & Chicago? — A. Yes. Q. That is the line from Pittsburgh to Chicago? — A. Yes. Q. How much did you refund to it ? — A. 59| per cent. The Pitts- burgh, Cincinnati, Chicago & St. Louis Division. Q. That is the Vandalia Line? — A. No, that is the Panhandle Line. Q. The Panhandle line, I mean, running between Chicago & St. Louis? — A. Yes. Q. What did you rebate to it? — A. 56^ per cent. Q. So that you rebated to the Pennsylvania lines substantially 50 per cent or a little over? — A. Yes. Q. Then the Pennsylvania paid about 14 cents a gallon for its valve oil, about 9 cents a gallon for its engine oil, and about 9 cents for its car oil? — A. That would be the result to us. Q. Referring to this Pennsylvania contract, the Pennsylvania's guaranty to your company, that is the guaranty you made to the Pennsylvania Company as to the price of these oils for thousand mile run, has been substantially the same for ten years, hasn't it?— A. With the lines east of Pittsburgh and Erie? Q. Yes, the lines east of Pittsburgh have had substantially the same price or guaranty per thousand miles for a term of years? — A. For about five years. 865 Q. Hasn't it been nearer ten years? — A. No; they were changed about five years ago. Q. During the last ten years they have paid about the same propor- tion of the invoice prices, haven't they ? — A. Well, I can't recollect as to that. STEINBKENNBR. 425 Q. Well, substantially the same? — A. I think the first few years of the contract they paid a higher percentage of the prices. Mr. Kellogg. Now I ask the stenographer to mark certain state- ments which were called for by the government and made up by the Galena Signal Oil Company, which I now hand to the stenographer. Mr. MiLBUEN. Let me see them, please. (Mr. Kellogg hands the statement to Mr. Milburn.) Mr. MiLBUEN. Are you going to put all these in? Mr. Kellogg. Yes, I am going to put them all in. Mr. MiLBUEN . I want to submit as to these statements which are now offered in evidence, and which are prepared by the Galena Company from its books, that it is baring, in its entirety, their business, their relations to all of their customers, the results of all of their relations with all of their customers. I ask that that exhibit be taken charge of by the Examiner. It is here for the purposes of this record, for the purposes of any argument that may be made about it as evidence. I think we have a light to ask the Examiner to reserve this 866 record as merely as an exhibit in this case, not as a public doc- ument. (Handing papers back to Mr. Kellogg.) The Examinee. Have you any objection to that suggestion? Mr. Kellogg. Yes, very serious objection to it. We alleged in our bill that the Galena Signal Oil Company Mr. MiLBUEN. Well, who has a right to this paper? Do you want it to go to the newspapers ? Is that your argument ? Mr. Kellogg. I want it to be a public record in this case. Mr. MiLBUEN. I don't object to that. It is an exhibit in this case, and I ask the Examiner to take charge of it. Nobody has a right to see that exhibit excepting counsel. Mr. Kellogg. The testimony in a case of this kind cannot be taken confidentially. Mr. MiLBUEN. I don't ask it to be taken confidentially. Mr. Kellogg. Neither the Court nor the Examiner has any power to take testimony confidentially. The Examinee. This suggestion occurs to me. Of course, this paper is here, and either side is at liberty to read from it, I suppose ; to put it into the record and read it, and the duty of the Examiner is to file this testimony in court. Mr. Kellogg. Certainly. The Examinee. Then it becomes a public record. But does it be- come a public record imtil it is filed in the court ? 867 Mr. KJELLOGG. I think so. Now are we going to have copies made for counsel's use ? Mr. MiLBUEN. You have got copies. Mr. Kellogg. We ha^e not ; we have got only one copy. Mr. MiLBUEN. You can have another copy. The Examinee. Of course, this paper can be used by counsel on either side. Mr. Rosenthal. There is no objection to that; that is not the point at all. 426 STEINBRENNBR. The Examinee. That question was raised once before. The ques- tion was asked me, I think by the representative of some paper, as to whether some document (1 have forgotten now just which one it was) the public had a riglit to see a copy of it. I was not called upon to make any ruling, but it occurred to me it was rather ques- tionable whether the Examiner could allow the public to come in here and copy any paper or exhibit in the case. Mr. Kellogcj. In taking testimony under Rule 67, on notice by either party to the other party that it desires the testimony to be taken orally before an Examiner, the Court shall appoint an Exam- iner to take the testimony orally, which includes the introduction orally and publicly of all documents. They may be read in evi- dence, or offered, or reading waived. The stenographer may, under the order, take down the testimony, or for convenience of counsel reading may be waived, and he may copy the documents. Now, we alleged in our bill that between the different railway systems 868 there were discriminations in the price of oil, by which cer- tain railroads paid one-half the price of others, which various railroads paid 62^ per cent of the price of others per gallon, and various discriminations which these gentlemen denied in their answer. Mr. MiLBDEN. And still deny. The Examinee. Well, I don't see, Mr. Kellogg, much chance of any question here. This testimony is offered. While you are using it it is here. After the testimony gets into the record, the record is put into the charge of the Examiner, and it is his duty to return it to the court. Mr. Kellogg. Certainly. The Examinee. And I suppose he could use his discretion with it after it gets into his possession, after it passes this point. If this goes into the record, I suppose he is responsible as to what use is made of it. Mr. Kellogg. Certainly, but I maintain that I am entitled, as the government counsel, to a copy of this document for my use. The ExAMiNEE._I think you are right about that. Mr. MiLBUEN. I am not objecting to that; I am not objecting to that. ^ The Exa:minee. I understand this is a request to the Examiner, ajfter this record comes into his hands, that he shall not allow the public to have access to it. That is a matter, I suppose, for the Examiner to pass upon. 869 Mr. Kellogg. I think the testimony becomes public when it is offered. The Examiner. I think that is true. Mr. Kellogg. And I do not tliink there is any power, either in the Court or the Examiner, to make it a private document. The Examiner. We have the record of several days here ; the rec- ord is complete on certain points. That record is in the possession of the Examiner. I presume it is my duty to return that record to the Coui't, and see that it is properly taken care of in the meantime. STBINBRENITEE. 427 Mr. Kellogg. The original copy. The Examinee. If an outsider should come in and say, " I would like to look at page 360 of that record," I suppose it is for me to say whether it is proper to let him see it or not. Mr. Kellogg. Certainly. The original is delivered to you, but copies are delivered to counsel for their use. The Examiner. I dont think there is any trouble about this ques- tion at all. I will take care of the record after I get it. Mr. Kellogg. Will you please mark that as an exhibit, each page being a separate number of the exhibit. A package of papers was handed to the stenographer, which were marked Petitioner's Exhibits 131 to 211, inclusive. The Examinee. I want to say further, that when the record 870 of the testimony and the exhibits go into the possession of the Examiner, my instructions to the stenographer have been and are that the entire record is accessible to the parties and their counsel, as is ordinarily the case with court records, for the purpose o;f examining the same, but they are not accessible to the general public. Of course I am not responsible for what counsel do with their copies, but I am responsible for the original record, and when I file it in court, my responsibility ceases. Then the public can go and ask what the records are. In the meantime, I conceive it to be my duty to keep it intact and preserve its integrity in every way. Of course counsel are responsible for their own acts in the matter. I do not regard the record as being a public document in the sense that any one has the right to come in and say that he would like a copy of it to use for any purpose. Mr. Kellogg. Very well. That is as I understand it. But let us have a distinct understanding about copies. We have arranged with the stenographer that each side is to have so many copies, and each counsel has a right to use that and show it to witnesses or any- body he wishes. And I have got to do it. The Examinee. I am simply stating what I propose to do with the record, as Examiner. Mr. MiLBUEN. As to what counsel do with their copy is 871 purely a matter pertaining to themselves, and of professional honor. The Examinee. Certainly. Mr. Kellogg. I want it distinctly understood that there is no ques- tion of professional honor about it. Mr. MiLBUEN. I am bound by that, as to what I do with copies. The Examinee. I merely make these observations because I want the public to understand what their rights are in regard to this record, and counsel of course understand their duty. Mr. Kellogg. I think I understand my duty perfectly. 872 Q. I show you Petitioner's Exhibits 131 to 211, inclusive. "WTiat are those statements, Mr. Steinbrenner ?— A. They are the result of the settlements with the railroads for the term indicated. Q. One railroad is stated on each page, isnt it? — A. Yes. 428 STEINBRBNNEE. Q. That list of railroads was furnished you from the list Petition- er's Exhibit 117, which you have furnished the government, was it not?— A. Yes. Q. And those were made up at the request of the government ? — A. Yes, sir. Mr. Kellogg. I offer those exhibits in evidence. Q. Are those made up by you, or under your direction ? — A. Yes, sir. Q. They are correct statements? — A. Yes, sir. Mr. MiLBTJEN. What is the number of the exhibits ? Mr. Kellogg. 131 to 211, inclusive. Q. That includes 81 railroads? — A. Yes. Q. Generally speaking, those are the most important systems in the United States?— A. Yes. Q. Now, the name of the railroad is at the head of the statement, and the statement of the prices is either for the year 1904 or 1905, is it not?— A. Yes. Q. You dont use the same year for the reason that— — A. Those statements cover the fiscal year of the contract ; that may be included in 1904 and 1905. Q. That is what I meant. The fiscal year of the contract? — 873 A. Yes. Q. In the first column, under head of " Locomotive Serv- ice," you name the different kinds of oils, do you not ? — A. Yes. Q. For instance, under valve oil, is the total number of gallons? — A. Yes. Q. Then, under the head of " Price " is the invoice price ? — A. Yes. Q. And under the head of " Value " is the total invoice value? — A. Yes. Q. That is the case of locomotive service, passenger car service and freight car service ? — A. Yes sir. Q. In most instances, generally speaking, wherever two cents a gallon is included for the barrel, that is deducted before you make up your figures, isnt it? — A. Yes. Q. But the freight is included? — A. Yes. Q. In making up the total cost under the invoice? — A. Yes sir. Q. So that these statements contain the total gallons furnished the road of each kind of oil ? — A. Yes. Q. And the total invoice price at which it is sold to the road in the first instance? — A. Yes. Q. And that invoice price, where there is extra freight, includes that extra freight? — A. Yes. Q. And the total cost of that oil according to the invoice price ? — A. Yes. Q. From which you deduct anything included for barrels, 874 so that the barrels dont cut anv figure in this statement? — A. Yes. STEINBEENNEB. 429 Q. Then, under the head of " Guaranteed Cost " you state the locomotive mileage and the guaranty to the railway company, do you not? — A. Yes. Q. And following it the cost of the various locomotive oils on the basis of that guaranty? — A. Yes. Q. You state the passenger cars, the number of miles the passenger cars have run, the guaranteed cost to the railway company and the total cost of oil under that guaranty? — A. Yes. Q. And the same as to freight cars ? — A. Yes. Q. Then you add up what the company should pay imder its guaranty? — A. Yes. Q. The total '(—A. Yes sir. Q. And if the amount the company should pay under its guaranty is less than invoice price, you rebate it, or pay it back to the railway company? — A. Refund the amount. Q. Eefund the amount to the railway company? — A. Yes. Q. And the statement in each case shows the percentage of refund from the invoice price to each railway company? Mr. MiLBUEN. If there is any. Witness. From the total cost, if there is any. Q. Well, the total cost is the invoice price? — A. Made up by the invoice price. Q. Then, your percentage that you refund is practically a percent- age from the invoice price, isnt it ? — A. We dont regard it so. 875 Q. Well, let us see. Now, you stated that the invoice price of 48 cents for a certain class of oil, 28 and 18 cents, is the uniform invoice price? — A. Yes. Q. Outside of certain territory you add a certain number of cents, from 1 cent up to 5 or 6 per gallon, for freight? — A. Yes. Q. And that freight enters into the total cost of the road ? — A. Yes. Q. Then you take the number of locomotive miles and figure up what the company should pay for its locomotive lubrication on the guaranteed basis? — A. Yes. Q. And set down the actual figures in dollars? — A. Yes. Q. You do the same as to passenger cars and freight cars, because they haxe different prices per thousand miles run? — A. Yes. Q. And you add that up ?— A. Yes. Q. And you compare that with the total amount the railroad com- pany has paid? — A. Yes. Q. And if it is less than the railroad company has paid, you pay them back the difference?— A. In a lump sum, yes. Q. In a lump sum. And then you have put down here the per- centage of the total that you pay back?— A. Yes. Q. Very well. The lump sum, that is, the amount that they actu- ally, ultimately, do pay is a certain percentage of the total amount they paid in the first instance, isnt it? — A. Exactly. Q. And they paid the invoice price in the first instance?— 876 A. Yes. 430 STEINBEEKNER. Q. And then it would be a percentage of the invoice price, wouldnt it ? — A. Not necessarily, because they are varying quantities and vary- ing piices. Q. Oh, yes. It is substantially that, isnt it? — A. I should not regard it so, as an accountant. Q. It is a percentage of the total invoice price? — A. It is a per- centage of all oil consumed. Q. And all consumed you sold at the invoice price ? — A. There may be ten different prices and ten different quantities. Q. Yes, but it is a percentage of the total? — A. It is a percentage of the total cost. Q. Very well. We will take the Atchison, Topeka & Santa Fe. You stated in this statement that the invoice price including — no, that doesn't include freight — paid by them was $40,729.98? (Hand- ing witness exhibit.) — A. Yes, that is the Coast Lines of the Santa Fe. Q. That is simply the Coast Lines of the Santa Fe? — A. Yes. Q. Yes, that is right. That is a part of the Santa Fe system. — A. That is a part of the Santa Fe system. Q. Their contracts are separate for the Coast Lines? — A. Yes. Q. Now, what they actually should have paid was $30,353.92? — • A. Wliat they shoud have paid ? Q. Yes, under the guarantee. — A. That they finally did pay. 877 Q. Yes, what they finally did pay under the guaranty. — A. Yes. Q. So you refunded to them $10,376.06 ?— A. Yes. Q. "VVliich refund was a 25 percent of the total gross invoice price which you sold it at, in the first instance ? — A. Made up by the vari- ous invoice prices. Mr. Kellogg. Yes. Now, read that question, Mr. Reporter, and see if the witness can answer it. (Question read.) Mr. MiLBUEN. Billed it at. Mr. Kellogg. Billed it at, then, if you want it that way. Is that right? Witness. State that question again. (Question read.) A. Yes. Q. That is what I thought. The ExAMiNEK. Gentlemen, we will suspend at this point. It seems desirable to take an hour and a quarter for this midday ad- journment. We consume that time, and I would rather have it the rule than have it the violation. Mr. Kellogg. I am willing it should be the rule. The Examiner. So you will be prepared to go on promptly at 2 o'clock. STEINBEBNNER. 431 878 ArxEENOON Session. The hearing was resumed at 2 o'clock P. M. C. C. Steinbeenner recalled as a witness on behalf of Petitioner, testified as follows: Direct examination (resmned) by Mr. liEU.OGG: Q. Mr. Steinbrenner, you do then keep statistics in your office, for another purpose, which show the reduction for each grade of oil?— A. No. Q. Well, do you keep the figures which will show the engine mileage, the guaranty and the result of the guarantj?^ for the engine mileage, separate from the other? — A. No. Q. "V\'Tiat did you say you kept in your office for another purpose, then? — A. We keep the average cost per thousand miles for each class of service separately. Q. The average cost per thousand miles of each class of service?— A. Yes. Q. Is that made up for 1904 and 1905? — A. Yes; you can get it from these statements. Q. What is that? — A. You can get it from these statements by making calculations. Q. We can make it up from these statements? — A. Yes. Mr. MiLBUEK. Why not have it explained? Q. What do you mean by average cost? — A. The aver- 879 age cost of the total cost of oils consumed in locomotive service, based upon the mileage made in locomotive service, likewise in passenger and freight car service, in order to guide our experts in their work as to cost. Mr. MiLBUEN. Give an instance. Witness. Simply average ; averaging the cost per thousand miles. Q. How are you going to figure it from that statement? — A. By taking the mileage as shown here and dividing it into the total cost of the oils. Mr. MuBUEN. What one have you? Witness. The Atchison, Topeka & Santa Fe. Q. But the trouble is your statement does not show the net cost of each separate service on the locomotives, each separate kind of oils? — A. No. Q. Then your books won't show that?— A. No. Q. That is, you take the locomotive service and divide the total net cost by the miles? — A. Yes. Q. For each thousand miles ? — A. Yes. Q. And the same with the passenger car service and the same with the freight car service?— A. Exactly. Q. That can be figured from this statement ?— A. Yes. Q. Now, isn't it a fact that your per cent of excess (excess of the invoice price) over what the company finally pays, should be based upon the invoice price of the oil exclusive of freight?— A. No. 432 STEINBKENNEE. Q. The freight has got to be paid anyhow, hasnt it? — 880 A. Yes. Q. You don't refund the freight, do you ? — A. The guaran- ties inckide the cost of the oil delivered to the road. Q. Well, but do they?— A. Yes. Q. There is nothing here to show it? — A. Well, they were based upon the previous cost which was made up in that way. Q. Well now, let me take an instance to illustrate that. You take the Southern Pacific system. Take the Pacific system. The prices of locomotive service, the prices named, the invoice price to the Southern Pacific Company system is valve oil 54 cents, engine oil 34^ cents, car oil 33.9 cents, center-plate grease 22.2 cents. That is correct ? Mr. MiLBUEX. Yes, that is all right. Q. Now, there was refunded, according to this statement, to the Southern Pacific Company, 41 per cent of tlie gross invoice price; is that correct? — A. Yes. Mr. MiLBtTEN. Of the gross gallonage of the invoice price? Witness. Yes. Mr. Keixogg. Yes sir. Q. Now, that invoice price was 48 cents for valve oil and 6 cents for freight, wasn't it? — A. Yes. Q. You don't refund the freight to them, do you ? — A. No. Q. They pay the full freight anyhow? — A. Yes. Q. So your percentage was refunded entirely on the oil price wasn't it? — A. No. Q. Well then, you refunded the freight to them, did you ? — 881 A. No; the guaranties there are based upon the oils delivered to their line previously. Q. Suppose they are, you don't refund any freight? — A. We re- fund the excess cost. Q. Well, you refund the excess cost, but it is all refunded from the price of the oil, isn't it? — A. No. Q. Then you are refunding freight? — A. Because there is a like amount or a smilar amount included in those giiaranties for fi'eight. Q. The guaranties are simply a lump sum? — A. The guaranties are based upon the cost of the oil delivered to the lines prior to our contracts, which included the freight at that time. Q. Now, tlie Southern Pacific had a refund of 41 per cent? — A. Yes. Q. In order to compare that with a road that had no refund and no freight charges you would have to take the freight out of this, wouldn't you?- — A. No. Q. Well, let us see. Take the Southern Railway. The Southern Eailwiiy paid full invoice price, didn't it? — A. Yes. Q. 48 cents for valve oil. 28 for engine oil, 33 for passenger cars and 18 for freights; did it not? Paid full iuA'oice price (handing witness paper) ? — A. Yes. STEINBBENNEE. 433 Q. It had no refund whatever. Now, in order to compare the Southern Pacific system, which had a refund of 41 per cent, with the Southern Eailway which had no refund, you have got first to deduct the freigJit from the Southern Pacific system, haven't 882 you? — A. If we did that in one case, we would do it in all. We would also do it in the guaranties to make comparison. We would have to take the freight out of the guaranties, as well as in the price of the oil. Q. Well, in that event, if you did that, the refund would be the same, wouldn't it, the cash refund would be the same ? — A. Yes. Q. And your percentage would be very much larger? — A. The percentage would be just the same. Q. I can't see it. — A. If you reduced two quantities in the same ratio, the percentage would practically be the same. Q. Well, take the Baltimore & Ohio Railway. (Handing witness paper.) Look at that, will you please?— A. Yes. This is the South- ern. Q. Well, turn to Baltimore & Ohio. Mr. MiLBUEN. What is the one you have now? Mr. KJELLOGG. The Baltimore & Ohio. Q. W hat is the invoice price there ? 48, 28, 33 and 18 ?— A. Yes. Q. There is no freight included in that? — A. No freight. Q. Well, they had a refund of what per cent? — A. 23. Q. So, in that case, of course, that was solely a refund of 23 per cent of the gross invoice price paid? — A. Yes. Q. Now, you take the Delaware and Hudson. Mr. MiLBUEN. Have you got that Baltimore & Ohio system price of 48 right? Witness. It is 48 in bulk. The barrels are taken out below. 883 Mr. MiLBURN. Oh, yes, I see. Q. What it actually paid was 38^ for valve oil, 23.1 for en- gine oil? Mr. MiLBiTKN. That is the way you figure it. Q. According to your figures ? — A. No, not according to ours. We dont figure it that way. Q. Well, that is the way it does figure if you apply your percent- age? — A. That is according to your theory, but not ours. Q. But will you tell me, if your road gets a deduction of 25 or 30 percent from the gross invoice price, if it gets a reduction of 50 per- cent from the gross invoice price, it pays one-half of the invoice price, doesnt it ? — A. If the quantities and all were the same, it might be. Q. It would be one-half of the invoice price of all the oils, wouldnt it? — ^A. Not necessarily. Q. Well, I would like to have you explain how you can refund to a railroad company 50 percent of the gross price of all its oils and have it pay more than one-half of the invoice price of all its oils. Will you do that? Mr. MiLBUEN. That depends on how you distribute the cost. 32555—08 28 434 STEINBRENNEB. A. We simply take it out of the total quantity. Q. You take off 50 percent from the total invoice price? — A. The total oil consumed, yes. Q. Now, take the Delaware & Hudson. What price does it pay? What is the invoice price? — A. 53, 30 and 20, less barrels; that is, 48,28 and 18. Q. Now, in making your refund there, you first take out the 884 barrels, dont you? — A. Yes. Q. So they dont cut any figure ? — A. No. Q. There is no refund in that case, is there? — A. There is no re- fund there. Q. That is full price ? Mr. MiLBrsx. Yet it worked so well that it got down below the guaranty. Mr. Kei.logg. Oh, I dont think so. Q. They paid full price? — A. Yes; they saved some money as comj)ared with the guaranties. Q. I dont see how they saved very much when they paid 50 cents a gallon as against 23 from the Pennsylvania. — A. Maybe they did. Q. Mr. Steinbrenner, you have accounts showing the total amount of oil sold to the Waters-Pierce Company, ha vent you ? — A. Yes. Q. Will you please give us a statement for the years 1904 and 1905 corresponding with this statement as nearly as possible ? — A. We can get it for you. Q. Of the total number of gallons of oil, railroad lubricating oil, I mean, sold to the Waters-Pierce Company by the Galena Signal Oil Company; the total charge to the Waters-Pierce Company as well as the charge per gallon and the commissions paid, and the final settlement for the oil, the amount finally paid on the settlement for the oil between the Waters-Pierce Company and the Galena Signal Oil Company, as we wish to add that to this statement. Will 885 you also procure the same information if you can, from the Waters-Pierce Company, during the same period, of 1904 and 1905, as to the railroads served, contracts, refunds, etc. — A. We have nothing to do with that. Q. You have nothing to do with that. Then you can furnish the first?— A. Yes. Q. And you need not ask for the second. Now, as I understand you, the Pennsylvania, for at least five years, has paid substantially the same price — the Pennsylvania lines east of Pittsburgh? — A. I would think so. Q. Now, hasn't that run back about ten years? — A. No. Q. It has not?— A. No. Q. You could make a statement for ten years, could vou? — ^A. Yes. Q. The Central of Georgia I notice pays about 60 per cent of the contract price. — A. In that year, under a contract. Q. Under this 1904? — A. Yes, under that contract. Mr. MiLBUEN. That is not 60 per cent of the contract price? STEINBBENNBB. 435 Q. That is 60 per cent of the invoice price? That is what I should have said — invoice price. Mr. MiLEUEN. That is different. Q. Now, hasn't it paid the same for about ten years? — A. No. Q. They paid about the same in 1900, didn't they?— A. I don't think we had a contract with them in 1900. Q. Paid about the same in 1904?— A. Well, that is the 1904. 886 Q. I mean 1902.— A. I don't think we had a contract in 1902. Q. You did not? The New York Central paid substantially full price for about ten years, hasn't it * A little refund once in a while? — A. I couldn't say as to that. Q. What is that? — A. I couldn't say as to that. Q. You don't remember ? — A. No. Q. What about the New York, New Haven & Hartford ? It pays substantially the full invoice price ? — A. The full invoice price. Q. Has for how long? — A. For some time; I cannot remember how long. Q. The Illinois Central pays full invoice price? — A. Yes. Q. Has for how many years? — A. Several years. I don't know how long. Q. Eight or ten years? — A. Possibly that long. Q. The Southern Kailway pays full invoice price? — A. It does now. Q. How long^ has it ? — A. Possibly two years. Q. Possibly two years? — A. Yes. Q. Did it previous to that? — A. I think not. Q. Would it be difficult to make up a statement of the following roads, say ten years if you have it, or as many years less than that that you had the contract, for the New York Central, New York, New Haven & Hartford, the Illinois Central, the Southern Rail- way, and the Great Northern? These are representative. — A. I think we can give you the information. 887 Q. Back ten years if you have it. — A. Yes. Q. And say the Pennsylvania, for a period of ten years, the full system. — A. All right. Q. As near ten years, I mean, as you have it? — A. Yes. Q. Together with copies of the contract for each year for those roads. You got the Pennsylvania aliout 1896 or 1897, didn't you ? — • A. I think that came in about that time. Q. Well then, start with the beginning of your contracts on the Pennsylvania. I would like that from the time you started? — A. I said ten years on that — if we have the records preserved for that period. Q. If you have the records, together with the copies of the con- tracts. Mx. Kellogg. I think that is all now. It may be understood that Mr. Hunter may check up any of the other contracts here that he desires to. 436 STBINBRENNER. Mr. Mllbtien. Yes, down at the office Cross-examination by Mr. Milbuen : Q. Mr. Steinbrenner, did I understand you that you had been connected for the past fourteen years with the Galena Signal Oil Company? — A. It will be about fourteen years that I have been with them. Q. Was that, fourteen years ago, your first connection with that Company in any capacity? — A. Yes sir. Q. Had you been connected with any oil company prior to that time? — A. No sir. 888 Q. "Was this system of contracts for lubricating railroads in force when your connection with the company began? — A. Yes. Q. There has been no change in the system since that time? — A. No sir. Q. And it had existed for a great many years prior to that time, as you understand it ? — A. As I understand it. Q. Is the same contract for lubrication in use on the street rail- ways of the country ? — A. Yes. Q. And do you lubricate a great many of the street railway sys- tems of the country ? — A. About two hundred street railways. Q. Is it the contract which is in use in the lubrication of foreign railroads ? — A. Exactly the same. Q. In Europe? — A. In Europe, South America, Cuba, Canada; I think in India. Q. In India? — A. India. Q. What countries of Europe? — A. We have some contracts in England, France, Germany, Egypt; I think Norway and Italy. Q. Have you the same so-called invoice or initial price every- where? — A. Everywhere. Q. In the United States and abroad ? — A. Yes. Q. And South America? — A. And South America. Q. And you furnish to the railroads of all the various countries that you have mentioned, oils for the lubrication of those railroads under precisely the same contract which is in evidence here? — A. Yes. Q. And that has been going on, at any rate to your knowledge, for fourteen years? — A. Well, we entered the foreign field about 889 ten years ago. Q. Well, since you entered the foreign field, and in this country the entire time? — A. Yes sir. Q. You say you entered the foreign field about ten years ago? — A. About that time. Q. About that time? — A. About that time, if my recollection serves me. Q. Was that the first experience of your company in foreign coun- tries? — A. Yes. STEINBEENNER. 437 Q. Was there any lubrication of foreign railroads by American oils to any extent going on before that time?— A. I think not. Q. You entered that as a new field?— A. As a new field. Q. A.nd offered to the railroads this same contract?— A. Exactly. Q. This contract has these three essential features, I understand you : One is that a price is fixed at which the oil is billed and at which currently the railway companies pay for it?— A. Yes sir. Q. That is, a uniform price for all the railroads? — A. Yes sir. Q. Throughout the country, excepting points of delivery outside of a certain zone; to that price is added freight? — ^A. Yes. Q. What you add for freight, as I understand you, you base on ascertaining (if existing railroad rates) the amount of freight per gallon? — A. Per gallon. Q. So that when you talk about an approximation, it is a com- putation that you make on an actually existing railroad rate be- tween the points in question? — A. Exactly. 890 Q. The second is that you guarantee that the cost of lubri- cation, all kinds of lubrication, shall not exceed a certain sum? — A. Yes sir. Q. For that railroad ? — A. Yes sir. Q. And the details of that sum are ascertained, as I understand, by applying a price which you give to a thousand engine or car miles, as the unit? — A. Yes sir. Q. The third is that you undertake to furnish experts to all of the railroads (to all of your customers) to instruct them, the em- ployees of the railroads, in the use of hAricating oils so as to secure efficiency and economy in their use? — A. Yes. Q. The so-called invoice price is simply an initial price which, as you may say, the railway company is charged? — A. Yes sir. Q. The actual settlement is made on the basis of your guaranty ? — A. Yes sir. Q. If the railroad has used so much oil for lubrication that the guaranty is exceeded, why it only pays the guaranteed amount? — A. Exactly. Q. And if, on the other hand, through attention given to the matter, through availing themselves of the use of your experts, practicing the economies, they accomplish the lubrication of all of the mileage that they run at less than the guaranteed price, they pay simply for their gallonage at the invoice prices? — ^A. Exactly. The balance is to their gain. Q. The balance is to their gain ? — A. Yes. Q. If they fall below the guaranty they make it? — A. They make it. 891 Q. So that is a premium to every railroad to avail itself of the expert service that you render, to secure the most efficient and economical use of the lubricating oils ? — A. Exactly. Q. And the road whose cost of lubrication is the gallonage multi- plied by your invoice price, (and that sum is less than your guar an- 438 STEINBRENNEE. teed price) is the road whicli is being, according to your standards, the most economically and efficiently lubricated ? — A. Yes. Q. To what extent is this furnishing of expert aid in lubrication carried? — A. We have about 50 men traveling this country all the time for that purpose. Q. What do they do? — A. They go about, visiting the executives of the railroads and conferring with them, suggesting to them what might be done towards reducing the consumption, getting better re- sults. They study the mechanical conditions that might affect lubri- cation, to prevent hot boxes, hot journals, and in every way studying the conditions that might affect the consumption of oil, and offering suggestions to the railroads with a view of overcoming these con- ditions. Q. Do they come in contact with the man who is pouring the oil? — A. They instruct the engineers, the oilers, for applying the oil to passenger and freight cars; they look after caring for the oil at the storehouses, to see that the conditions are in proper shape, so that there may be no leakage, and everything that might pertain to the lubrication question. Q. Is that instruction to instruct them how to use the oil in eco- nomical quantities? — A. Yes sir. Q. And at the same time with efficiency? — A. Yes sir. 892 Q. To prevent wastage of oil? — A. Wastage, and every- thing" that might bi ing about economical results. Q. And if there is a saving in the quantity of oil through more effi- cient and more scientific lubrication, there is a saving in other ma- terials, is there not? — A. Yes sir. Q. Waste? In the waste that is used, for instance? — A. The waste. Q. Is that one ? — A. Yes. Q. Labor? — A. In handling the quantities. Q. Xumber of hot boxes? — A. Number of hot boxes, the reduction in the quantity of brasses that might be consumed. Q. How is the quantity of hot boxes now, in the operation of rail- roads, as compared with five or ten years ago? — A. There isn't prob- ably one, as compared to two hundred, to date. Q. And by reason of what? — A. By reason of the perfect lubrica- tion and better quality of oil being used on those roads, more intelli- gent use of the oil. Q. That is the result aimed at by this corps of experts which you keep going all through the country ? — A. Yes sir. Q. In connection with nil these railroads? — A. Exactly. Q. Do they avail themsehes of the use of your experts? — A. Every one of them. Q. Eh? — A. Almost every road in the country does. Q. Do you know of any other concern that has ex})erts like that going about the country, and the railroads A. I do not. Q. Studying iuul advancing the art of lubrication? — A. I 893 do not. STBINBRENNER. 439 Q. Well, you will say there are none?— A. I will say there are none. Q. Well, this matter of lubrication is a very important one in rail- road operation, is it not?— A. I should think'^it would be, yes sir. Q. Take the one item thiit you mention, the matter of hot boxes is almost entirely a matter of lubrication, is it not? — A. Yes sir. Q. And the gradual elimination of the hot box has saved a great deal of delay in train service?— A. Delay and money and labor. Q. And accidents? — A. Yes. Q. I suppose your business has been a growing business, year by year? — A. Gradually growing business, yes sir. Q. Taking the fourteen years, am I right in assuming that your patronage by the railroads has gradually increased ? — A. Yes sir. Q. You have been adding to your patronage ? — A. Yes. Q. And is it a fact that your original contract with a new railroad that you take on, that your guarantee is that you will lubricate that railroad for 90 per cent of the cost of lubrication during the previous year? — A. That is the usual arrangement. Q. That is the usual arrangement that you begin with? — A. Yes. 894 Q. So that, if you were to go out tomorrow and make a con- tract with a railroad which you had never lubricated, your guaranty would be to do it for 90 per cent A. Yes sir. Q. Of the cost of the previous year ? — A. Yes sir. Q. What is your theory of that ? — A. The idea in that is in using a lesser priced oil, a cheaper oil, or an oil of poorer quality, by intro- ducing an oil of better quality you can use less of it, and produce much better results and cheaper results per unit of work performed with it. Q. So you feel that the oil that you manufacture, and its superior quality in your judgment, and your methods, the instrument of the aid of your experts, that you can always reduce the cost of lubrica- tion to railroads at least ten per cent? — A. Yes; we generally ac- complish that result. Q. From that time on, is it a matter of study with your company, with respect to the conditions which prevail on each railroad? — A. Yes sir. Q. Now do the conditions on each railroad as to lubrication vary? — A. There are no two roads, no two divisions, nor two engines will be run at the same cost per thousand miles, hardly. Q. Now, Mr. Steinbrenner, iust develop that idea in an answer in your own way, without specific questions from me, of the different conditions with respect to lubrication on different railroads? — A. Well, we have only to refer to the Pennsylvania The ExAJiiNER. A little louder. Mr. Steinbrenner. Witness. We have only to refer to that Pennsylvania contract. There were six or seven divisions of that road that we 895 took at 90 per cent of their previous cost, which was based upon an oil that they had been manufacturing or buying, and 440 STEINBBENN-BB. if I recollect aright, they were paying about 20 cents a gallon for valve oil, possibly 13 cents for engine oil, and 6 cents for car oil, prior to our advent on the road. We took that contract at 90 per cent of their previous cost, and each grand division of that system has a varying cost or different cost per thousand miles. The question of personnel enters into it; the management, and varying conditions that might develop that difference. Q. Grades? — A. Grades; different rolling stock; different char- acter of rolling equipment; conditions in every way might bring about that result. Q. Soil, sandy soil ? — A. Sandy soil, weather conditions. The cost varies from month to month or year to year, as the case may be. Q. And there are what you might call permanent variations? — A. Gradients, and things of that kind. Q. Which are different on different railroad systems ? — A. Yes, sir. Q. Now, after you have made your first contract to lubricate for 90 per cent of the previous cost, do you study the conditions of that road with reference to determining what your guaranty shall be at the expiration of that contract, or when you make a new contract ? — A. Yes. Q. Is it your constant aim to reduce the cost of lubrica- 896 tion?— A. Always. Q. Take the experience of the past ten years, during the past ten years, what has been accomplished in the way of reducing the cost of lubrication on railroads? — A. I can only — I recall one in- stance, the New York, New Haven & Hartford. We took that on a 90 per cent basis of their previous cost when they were using cheaper priced oils, or lower priced oils. The cost per thousand miles for locomotives at that time — and when the eqipment was much lighter than it is today — was, I think, above $r* per thousand. It made our first guarantee I think $4. Today we are lubricating that road at I think $2.25 per thousand miles, and very much larger reductions in the cost of lubricating passenger cars. The first guaranty we had there I think was 45 cents a thousand miles. If I recollect aright, our present contract is 20 cents a thousand miles for passenger equip- ment. Freight cars was, I think, 10 cents originally. Today it is 7 cents a thousand miles. Notwithstanding a very much larger equip- ment that has been introduced since our original conlract on that road ; resulting in a saving to the railroad of thousands of dollars in that period, and I think we have had them about 10 years on our books. And we can show many instances of that kind. The Inter- Colonial Kailway of Canada started with a guaranty of I think it was Mr. Kellogg. What railroad is that ? Witness. The Inter-Colonial, the Government railroad of Canada. It started with a guaranty of $4.50 per thousand; I think 897 those are the figures; and today we are lubricating that road for $2.25 per thousand miles, and a like reduction in the cost of passenger and freight equipment. STEINBKENNER. 441 Q. Well, can you state, as a general proposition, that the cost of lubrication of railroads has been a diminishing quantity? — A. De- cidedly. Q. What I mean, with your methods in operation, the effect of them is to A. To constantly decrease the cost per thousand miles. Q. And with all the other consequences which you have mentioned there, the saving of train delays through hot boxes and accidents, etc.? — A. Yes, sir. Q. Now then, as contracts expire, you apply the knowledge that you have acquired and the study of the situation to the determination of what your guaranty shall be in each case? — A. Yes sir. Q. And is it not your effort to reach such a sum in that guaranty as will express your judgment of what the cost at which that road should be lubricated, with proper methods applied, plus your manu- facturer's profit? — ^A. Yes. Q. That is your judgment? — A. That is our judgment. Q. That is your judgment of what that road should be lubricated for? — A. Yes. Q. And including in it, of course, the profit of the oil to your com- pany? — A. Yes sir. Q. Now that, as you say, varies with all the different railroads and the different conditions that prevail on railroads ? — A. Yes sir. 898 Q. And your judgment is based on certain shifting and vari- able factors, is it not? — A. Yes sir. Q. That is, you may expect improvement in lubrication by the rail- road employes, and not get it ? — A. Yes. Q. You may get it one year and not another year? — A. And not another. Q. On some railroads and not on others? — A. Yes sir. Q. But that g-uaranty expresses your business judgment? — A. Yes sir. Q. Of what it should be done for, and is the risk which you are willing to take in the transaction of your business? — A. Yes sir. Q. And that guaranty is offered as a separate and distinct matter to every railroad that you deal with ? — A. Yes sir. Q. If at the invoice prices, the cost to that road, taking the gallon- age it consumes, is less than your guaranty, that shows to you, does it not, that the road has been lubricated in a better and more efficient and more economical way than even you anticipated? — A. Yes sir. Q. I suppose with every railroad company you have to negotiate, make the best contract you can ? — A. Yes. Q. You camiot always get the guaranty at the figure that you want? — A. No sir. Q. And a good many factors, when you can't get that figure, may enter into whether you will reduce your guaranty and the 899 extent to which you will reduce the guaranty to preserve that system? — A. Yes. Q. I suppose the lubrication of the Pennsylvania Railroad sys- tem is, apart from any relations between you and the Pennsylvania 442 STBINBEENNEK. Railroad, a very valuable asset as an advertisement abroad, isn't it?— A. Yes. Q. Tt is the best known American railroad abroad, is it not? — A. I think it is, from the information I have. Q. And you will say that it has the highest reputation as an operating road? — A. Yes. Q. Have yovi made contracts abroad, yourself? — A. Not myself, no sir. Q,. Well, have you by correspondence, and seen the correspond- ence? — A. Yes. Q. And has that point been emphasized? — A. Yes. Q. In other words, you take it in foreign countries, which I have heard are a little more conservative than ours, that a road like the Pennsylvania road is lubricated with your oil, is a great fact in getting business? — A. Yes. Q. And so far as your knowledge goes in dealing with the Penn- sylvania Railroad, you have to make the best contract that you can? — A. Yes. Q. Have you increased your guaranty from time to time? — A. Yes. Q. Increased it this last year? — A. Yes. Q. I suppose you have increased it all you possibly could 900 efl'ect, haven't you? — A. Yes sir. Q. You would like to increase it more, would you not? — A. Yes sir. Q. You do not enjoy the results of a guaranty which is less than you think it should be? — A. Not at all. Mr. Kellogg. That might be admitted. Mr. MiLBUEN. Well, the theory of the Government seems to be that we rejoice. Mr. Kellogg. Nobody claims you rejoice in losing money. Mr. Rosenthal. We congratulate the Government, anyway, on its first admission. Q. I suppose with your knowledge of that business, in all of its ramifications in this country and abroad, you would be very slow to lose the Pennsylvania system? — A. Yes sir. Q. They probably know it. I suggest they will, anyhow. Prior to your contracting with many of those railroads, did they lubricate their own roads, or buy their oil anywhere, or without much regard to what they were as long as they were cheap? — A. Yes. Q. And oils of their own devising you might say? — A. Yes sir. Q. Or compounding? — A. Yes sir. Q. And did they have their own lubricating department? — A. No. Q. The employes came on and went to work as always A. Just as they happened to be. Q. In other words, the lubrication was in a very crude condi- tion? — A. Yes sir. STEINBBENNEE. 443 901 Q. And yet j'ou took a railroad, and you made your first contract with a railroad, these were the conditions which you were in the language of today, " Up against "? — A. Yes sir. Q. Cheap oils, imperfect oils, poor oils, in many instances? — A. Yes sir. Q. I don't say in all instances. And very crude and imperfect lubrication? — A. Yes sir. Q. Anything to save was the principle ? — A. Yes sir. Q. And that was what you undertook. You undertook to lubri- cate at 90 per cent of that cost? — A. Yes sir. Q. The cost under those conditions? — A. Yes sir. Q. And I suppose, after you went to work, you found more or less resistance to the new conditions that you sought to remedy? — A. We always find them. Q. By the old men ? — A. The old men. Q. The old ways? — A. Yes; it takes time to educate them into a more systematic use of oils and the handling of oils — economical use of oils. Q. And your business has gone on from year to year, steadily in- creasing? — A. Yes sir. Q. In this department of it you deal, in making your contracts, with the highest officials of these railroads, do you not? — A. Gen- erally. Q. And how many railroads did you say in this country — over 200 railroads? — A. Street railways. 902 Q. No, no. Over 80? I see. — A. These are just a partial list of the roads we ha-\'e under contract. Q. How many steam railways? — A. We have probably 300 con- tracts in existence with steam railways. Q. 300 contracts with about 200 systems of railways? — A. With different railways. Q. For instance, with the Pennsylvania, it has two or three con- tracts? — A. Tliree contracts with the Pennsylvania system. Q. And you say you have 300 contracts; how many railroads would that represent — about 200 ? — A. 2.50 steam railways, I should say. Q. Every contract is the product of negotiation? — A. Yes sir. Q.. With the officials of those railroads ? — A. Yes sir. Q. Scattered all over the United States ? — A. Yes sir. Q. And they are perfectly aware of the way in which your con- tract operates, that is, the effect of the guaranty and what the initial invoice price represents? — A. Yes sir. Q. They are perfectly conversant with all of the conditions? — A. Yes sir. Q. And the contracts are falling in and being renewed from time to time? — A. Yes sir. Q. And the amount of the guaranties changes? — A. It changes. Q. That is, there is no secrecy about the business and the negotia- tions for your contracts? — A. No sir. 444 SXEINBKENNEB. Q. It is a perfectly open thing, with all that mass of railway- officials? — A. Yes sir. 903 Q. And you seek to make a contract on the merits of the situation which you present? — A. Yes sir. Q. And out of that making the most profit that you can as a manu- facturer? — A. Yes sir. Q. You were asked — I don't think it cuts much figure, but you were asked about a comparison that was made of the New York Central, do you remember, in 1905 ? — A. Yes. Q. Had you any contract with them that year? — A. We had no contract during that year. Q. No guaranty? — A. No. Q. It was just for the supply of oils? — A. Yes ; they simply bought our oils currently. Q. At the prices? — A. Yes. Q. At what we call the invoice prices? — A. Yes. Q. There is just one point I want to make. There is no what you call rebating of any price in the working out of this contract, is there? — A. No sir. Q. The fundamental thing is the guaranty that that cost shall not exceed a certain amount of money? — A. Yes. Q. That is the fundamental A. That is the fundamental principle. Q. That is the fundamental feature of your contracts? — A. Yes sir. Q. But accounting, as you go along, and for partial payments, you take these invoice prices as governing the amount to be paid cur- rently? — A. Yes sir. 904 Q. Now then, if the guaranteed price is below the aggregate gallonage at the invoice prices, then you have to return what you have been overpaid? — A. Yes.- Re-direct examination by Mr. Kellogg : Q. Now, Mr. Steinbrenner, you say in reply to Mr. Milburn, that the matter of getting these contracts is a question of negotiation with each road? — A. Yes sir. Q. You get as much as you can, as big a price as you can, in each case? — A. Yes. Q. And use every influence you can to get the contract? — A. Yes. Q. You remind the railroad company of the amount of oil you ship over their line, don't you ? — A. No sir. Q. Never do ? — No sir. Q. Are you a soliciting agent? — A. I have renewed contracts. Q. You have made them ? — A. I have made contracts. Q. Do you do the soliciting of these contracts? — A. Yes. Q. All of them ?— A. Not all of them. Q. How many of them ? — A. Quite a number. Q. How many? Name them that you have solicited and secured ? — A. I made the contract with the L. & N., the Atchison, Topeka & STEINBKENNEB. 445 Santa Fe, the Buffalo, Rochester & Pittsburgh — well, my signatures will be attached to those contracts there whatever I have taken care of. Q. Well, the contracts are not all in evidence. — A. There 905 are quite a number, and I am usually present when other con- tracts are made. Q. Are you present when all contracts are made? — Not always, always. Q. When all contracts are solicited? — A. Not always. Q. Isn't it a fact that you are rarely present when contracts are made, and rarely present when they are solicited? — A. No. Q. Who is the manager in Chicago ? — A. Mr. Baldwin. Q. How many years has he been? — A. He has been with the Com- pany I suppose 20 or 25 years, I don't know. Q. How many solicitors have you? — A. We have one located in Chicago, one at San Francisco, one at Denver, one at Richmond, one at Wilmington, North Carolina ; we have two located in New York, and one in Canada, and some in foreign countries. Q. Now, Mr. Baldwin has what territory? — A. Mostly the roads centering at Chicago. Q. Are the contracts wliich you negotiate signed by you? — A. Yes sir. Q. We will examine them. You have named all of those you can think of ?— A. Yes. Q. Take the L. & N. road; you say you negotiated that? — A. Yes sir. Q. Previous to your negotiating for that contract A. That is, the present contract. Q. What? — A. That is the present contract I negotiated. Q. Oh. You did not negotiate the earlier contract? — 90C A. No. Q. Isn't it a fact, when you were trying to get that contract, it went to the New York Lubricating Company, in 1903? — ^A. I think they secured the contract at that time. Q. And in trying to get that contract, didn't your soliciting agent leave with the officer of the railroad a statement as follows, "At- tached to the papers is a memorandum left by Mr. , the rep- resentative of the Galena, which he was anxious to have you see, which it is claimed shows the business his company gave your road during the first nine and one-half months of 1902." Now, was there not such a statement as that furnished by your man? — A. No sir, not that I know of. Q. Not that you know of. Then, you don't know anything about it, do you? — A. Not that feature of it. I don't know what he does when he is out in the field. Q. You say there was no such statement furnished? — A. I don't know what he does when he is out in the field. Q. You don't know what the soliciting agent says to the rail- roads? — A. If he did, he did it unauthorized. 446 STEINBBENKEB. Q. Have you charge of all the soliciting agents? — A. I come in contact with them constantly. Q. Have you any charge of them ? — A. No sir. Q. Who has? — A. Our President. Q. And they report to him? — A. Yes. Q. You don't know what they do when they are out of your pres- ence? — A. No. 907 Q. You don't know what they say to the railroads ? — A. No. Q. You don't know what inducements they hold out? — A. No sir. Q. Now, the New York Central contract you say you didn't have in 1905 ? — A. I think that is the case. Q. You did in previous years? — A. Yes. Q. And you have one now ? — A. Yes sir. Q. And under that contract system they paid substantially full invoice prices, didn't they? — A. Yes. Mr. MiLBUKN. That is about the fourth time you have asked him that, and he said yes. Q. Now you say your commencement of the business was fourteen years ago? — A. Yes. Q. At that time the Galena Company was furnishing a large num- ber of raili'oads, wasn't it ? — A. Yes sir. Q. Under the present system of contracting? — A. Yes. Q. You don't know what the conditions were when they com- menced to use this form of contract ? — A. No sir, excepting as I have had occasion to go over the various contracts. Q. But of your own knowledge you don't know anything about it ? — A. No sir. Q. You didn't know anything about the condition of the lubrica- tion on the railroads prior to the time you went to work for the Galena Company? — A. Except as I had worked with the different railroads prior to that time. Q. But such contracts as these were in use years before 908 that?— A. Yes sir. Q. So that personally you have no knowledge of the con- dition of lubrication on the railroads prior to the time you went to work for the Galena? — A. Yes, I had 15 years in railroad service prior to that time. Q. In what capacity? — A. Chief clerk of the motive power de- partment. Q. What company? — A. The Pennsylvania, and the Bee Line, the Big Four, and the Illinois Central. Q. Now you say the Pennsylvania's reputation was such that it was worth getting a contract from? — A. We considered it so. Q. Whether it paid or not? — A. Yes. Q. Has a great reputation abroad? — ^A. Yes. Q. Have you ever been abroad and found out its reputation? — A. No. STETNrBKKlSnSrEE. 447 Q. You don't know what its reputation abroad is'^ — A. No, not personally. Q. Well, I thought Mr. Milburn was testifying, as he suggested. Mr. MiLBUEx. He said from the correspondence. You and I know that is a fact. We have been abroad. I have tried to counter- act it, and say it wasn't so, but none the less, they think the Penn- sylvania Eailroad is all the earth over here. Q. You think that reputation is sufficient so you can afford a loss on the Pennsylvania's conti-act? — Our management thinks so. 909 Q. Then you are doing the Pennsylvania's business at a loss, are 3'ou? — A. Yes sir, as I understand it. Q. Now, the Pennsylvania had been lubricating its own rail- road, hasn't it, prior to about 1896 or 1897? — A. Yes. Q. And had been making some very careful tests? — A. Yes. Q. And had reduced the cost of lubrication itself to a very great extent? — A. Yes. Q. I suppose other branches of railroad service have been reduced in expense, which branches the Standard Oil Company had nothing to do with, haven't they ? — A. I don't know as to that. Q. Don't you understand that railroad service in the country has generally improved in 25 years? — A. The cost of material has in- creased. Q. Oh, the cost of material has increased in the last few years ? — A. The service may have improved. Q. For the last 25 years the rates on railroads have been going down, haven't they? — A. Yes. Q. And for 25 years the operating expenses for the same amount of freight moved has been decreasing until the last two or three years' abnormal prices; isn't that true? — A. I suppose so. Q. And all grades of service on the railroad have been im- proved? — A. Yes. Q. So that the lubrication is not the only thing that has been im- proved? — A. It is a part of it. Q. It is a part of it?— A. Yes. 910 Q. Certainly. Mr. Milburn. Eailroads are like the United States gov- ernment. When they Want good oil they know where to go to for it; they go to the Standard Oil Company. Q. Now, during the last few years, you have been increasing your guaranties to the railroads generally ?— A. Yes. Q. So that you have increased the guaranty, the railroads have paid more for the same amount of oil in the last few years than they used to pay?— A. Not necessarily. Q. If you increase the guaranty they pay more per gallon for the oil, don't they?— A. No. Q. Are they not paying more per gallon for the oil today than they were paying five years ago?— A. No sir. 448 STEINBBENNEK. Q. Now, the invoice price has remained the same, hasn't it? — ^A. Yes. Q. The guaranty of cost to the railroad for each thousand miles run has increased in the last few years? — A. Not in all cases. Q. Well, generally over the comitry? — ^A. No. Q. In a great many cases? — A. Some cases. Q. In most cases? — A. No. Q. It has not decreased, has it? — A. It has. Q. Very little decrease? — A. Considerable in some cases. Q. Generally speaking, taking all the roads, the decrease has been very little, hasn't it? — A. No; in some cases very material decreases. 911 Q. Now, taking them all together, has the guaranty, on an average, of all the railroads, increased or decreased? — A. I would say increased, on an average. Q. Now then, if the invoice prices remain the same and the guar- anties have increased, then they are paying more for their oil, arent they?— A. No. Mr. Rosenthal. You havent got it clear yet. Brother Kellogg. Mr. Kellogg. I have got it clear what he says; that is all I want. Mr. Rosenthal. You havent got it clear in your own mind yet. Mr. Kellogg. That may be. Perhaps that is my fault, not yours. Mr. Rosenthal. I am sure it isnt mine. Mr. MniiBtJEN. I shall have to interfere here, and pour oil on the troubled waters, and it shall be the Galena oil. Q. Now, you spoke about the Central of Georgia. Prior to your contract of 1904, what company furnished the Central of Georgia its lubricating oil ? — A. I dont know. Q. Some other company did? — A. Some other company. Q. And you went in and got the contract? — A. Yes. Q. And to get that contract of course you made the best price that would take it? — A. Yes. Q. And you guaranteed to the Central Railway Company of 912 Georgia that the cost of lubricating its locomotives should not exceed 88 cents per thousand miles, didnt you,? — A. Yes. Q. Now, was that 90 percent of the previous cost? — A. I dont knoAv exactly on what basis that figure was taken. Q. Well, now, nearly all of your — even the Pennsylvania has a guaranty of $1.30, hasnt it — the lowest guaranty on the Pennsyl- vania is $1.30? — A. One of the divisions has $1.30. Q. What are the others?— A. Varying prices. Q. Well, name them. — A. You have them there. Q. Well, for locomotives on the Pennsylvania, the line west of Chicago— Pittsburgh, Fort Wayne & Chicago— it is $1.30?— A. Yes. It was at that time. Q. What ? — A. It was at that time. It has been increased since. Q. 1904?— A. Yes. Q. That is the same year I am talking about, the Central of Geor- gia. — A. All right. STEINBKENNEE. 4 4 'J Q. And the Central of Georgia was 88 cmial — A. Yes. Q. The Pennsylvania lines east were from $1.27 up to $1.88, werent they?— A. Up to $2.70. 913 Q. Yes, up to $2.70; that is right?— A. Yes. Q. The Central of Georgia was 88?— A. Yes. Q. That Company's lubrication wiis in the hands of the New York Lubricating Compuny, wasn't it? — A. I don't know. Q. You haven't such a general knowledge of the Central of Georgia as you have of some of the others? — A. No. Q. Some of your guaranties here nre as high as $3.18, aren't they? — A. Yes. Q. Well, you got the contract away from the New York Lubricat- ing Company, didn't you? Mr. MiLBUEK. He says he don't know. Mr. Kellogg. Oh, I thought he said he did. Q. Well now, after giving the Central of Georgia 88 cents guar- anty per thousand miles on its locomotives, 11.39 cents on its passen- ger cars, and 9.26 cents on its freight cars, you refunded to them 40 per cent A. Yes. Q. Of the invoice price, didn't you ? — A. Yes. 914 Q. Now, Mr. Steinbrenner, you say you keep traveling men. Wliat year did you get the contract for the Louisville & Nash- ville, the last time?— A. 1904 or 1905. Q. 1906, wasn't it?— A. I think it was 1905. Q. Well, you ha^ e no statement here except for the vear ending February 2s". 1906. You got the contract in 1905 ?— A. 1905, I think it was. Q. Previous to that time the contract was in the hands of the New York Lubricating Company, wasn't it? — A. I don't know. Q. You don't knoAv? Well, then, you don't know that you did not get that contract for 90 per cent of the previous cost? — A. It was 90 per cent of the cost that we had it under on our prior contract. Q. Oh ! You said in your testimony that you took these con- tracts at 90 per cent of the previous cost. — A. There was only an interin of two years that we didn't have the L. & N. Q. Those two years they got their lubrication very much cheaper than you gave it to them, didn't they? — A. I don't know as to that. Q. And you did not get that at 90 per cent of the cost of the pre- vious two years? — A. No. Q. Now, what do you mean by bidding 90 per cent of the previ- ous cost. You certainly do not mean that you took new con- 915 tracts for 90 per cent of the previous contracts that you had ? Mr. MiLBUEN. They first get a railroad, he says. A. The initial contract was on that basis. Q. A good many years ago when you started in this system you would bid a railroad 10 percent reduction ? — A. Yes. Q. But for a good many years your contracts with many railroads have been substantially the same, or an increase, havent they? — A. No. They are varying. 32555—08 29 450 STEINBKENNBK, Q. A good many of them are substantially the same? — A. Some of them are the same. Q. Did you take the Charleston and Western Carolina at 90 per- cent of its previous cost? — A. Yes. Q. When did you first take that? — A. I think it was at the time the Atlantic Coast Line first acquired control of it. Q. About when was that? — A. 1902, I should say; I am not sure. Q. What company was lubricating it at that time? — A. I dont know. Q. Did you take the Boston & Maine for 90 percent of its pre- vious cost? — A. I understand so. Q. Do you know that of ymv own knowledge? — A. Xo. Q. As a matter of fact, prior to your contract with the Boston & Maine, Swan & Finch, a Standard concern, was selling them, werent they? — A. I dont know. 916 Q. You dont know? — A. I dont know. Q. Wliat contracts can you name that you have taken at 90 percent of the previous cost? — A. The C. B. & Q. Q. When?— A. In 1890. Q. 1890?— A. Yes, I think it was. Q. What company had it previous to that time ? — A. I dont know. The C. M. & St. P. Q. How did you know what the costs were previous to that time? — A. It is on record. Q. Have you the record of it? — A. Yes. Q. Will you produce it? — A. I think I have a memorandum here that will show. Q. Oh, I want the original statement showing how you made it up. — A. This is the original statement; this is the record they had at that time. (Producing small memorandum-book, to which witness refers.) The first contract with the C. B. & Q. Railway was for freight and passenger cars. That was taken, I think, in January, 1891, based upon the twelve months previous to that date. Q,. Have you got the figures of the twelve months' cost previous to that date?— A. Yes. Q. What had it been? — A. It was 17.252 cents per thousand, miles, which was five percent below their cost for the year 1889. Q. That wasnt 10 percent. — A. That was 5 percent, and it has been a constant decrease since. 917 Q. Have you increased the guarantees on the Burlington since then? — A. No sir; they have decreased. Q. You state that you keep about fifty traveling men who travel over the roads to look after and improve the svstem of lubrication. — A. Yes. Q. Xow. what does it c^M to nay and what is the expense of those fifty traveling men? — A. I would assume it to be about $17.5,000 to $200,000 per year. Q. Have you got a statement of the last year, from your books, made up, showing the cost of that? — A. I havent it here. STEINBEENNEB. 451 Q. Can you get it ?— A. We can get it. Q. Will you please do so. Assuming it to be $175,000 a year, that is a pretty small item in your operations, is it not?— A. I don't know what the profits are. Q. I thought you had a general knowledge of this business. — A. I have, so far as the contract work is concerned. Q. Is it not a fact Mr. MiLBUEN. He says he does not know; so, why ask him? Q. Is it not a fact that the total profits of the Galena Signal Oil Company last year were $2,803,856.44? — A. I don't know. Q. Do you know anything about it at all? — A. No. Q. Do you know that its net assets were only $4,685,568.30? — A. No sir, I don't linow. 918 Q. Or just about 50 percent per annum on its assets? — A. I don't know anything about that. Q. And that it is over 250 per cent on its capital? Mr. MiLBUEN. Oh, suppose you get those figures from somebody who knows, and then you can harp upon them. A. I don't know. Q. You don't know anything about the capitalization? — A. The capitalization is $10,000,000, as I understand it. Q. Oh, $10,000,000?— A. Yes sir. Q. Then, the $175,000 is not a very large item in proportion to its profits, is it? — A. I don't know what the profits are. Q. You said that no other concern have experts traveling around to look after the lubrication of railroads ? — A. Not to my knowledge. Q. Now, do you mean that they have not, or that you don't know about it? — A. I don't know. Q. You don't mean that the other concerns haven't such? — ^A. Well, I have never heard of them. Q. You never have heard of them? — A. No sir. Q. During the two years that the New York Lubricating Company were lubricating the L. & N. road, do you know that they did not have experts working on it? — A. No. Q. You don't know anything about it ? — A. I don't know anything about it. Q. During the time that they were lubricating the Central 919 of Georgia, do you know they did not have experts? — A. I don't know. Q. Then, all you mean is that you dont know anything about it? — A. I dont know that they have any experts. Q. You dont know whether they do or not ? — A. No. Q. And you don't know whether any other company does or not?— A. No. Mr. MiLBCEN. He simply says he never heard of any such thing. Mr. KeliJogg. No, he said they didnt have. Q. You say you have about two hundred street-car lines in the United States?— A. Yes. Q. And about three hundred and some railroads? — A. Yes sir. 452 STEINBEENNEE. Q. Steam railways? — A. Yes. Q. You say you think you have about 95 percent of the railroads, and Mr. Miller says about 97^.— A. That is a small difference, con- sidering the mileage. Q. Well, of course, there isnt much left when you get up to 95 percent. — A. No. Mr. MiLBURN. You mean track mileage? Witness. Track mileage. Mr. Kellogg. Yes, that is what I mean. Q. You havent 95 percent of the street railways? — A. No. Q. Nor 50 percent of the street railways? — A. We only entered that trade within the last five years. 920 Q. You hope to get it?— A. "Yes. Q. You ha^■ent .'lO percent of the street railways, have you? — A. Not yet. Q„ Have you 25 percent of them? — A. No. Q. Have you 15 percent of them ? — A. But we expect 100 percent. Q. You do? — A. Yes. Mr. Kellogg. I have no doubt, if you are allowed to go on, you will get it. Mr. MiLBUKN. I guess they will have it. You dont want us to stop business? Mr. Kellogg. Not at all. Q. Now, foreigTL railroads. You clont have a very large per- centage of the foreign railroads? — A. We have quite a large per- centage. Q. What percentage? — A. We have nearly all the roads in France, tlie government roads and others. We have the govern- ment roads in Italy, and quite a number of others. I have never made up any statistics on the subject. Q. You dont know wluit the percentage is? — A. No. Q. Well, compared with the number of roads, the percentage is small, isnt it? — A. No, I would say a large percentage. Q. In all the countries of Europe? — A. Yes. Q. You have a large iiercentage of all the countries in Europe? — A. Yes. Q. ^A'hat percentage? — A. I told you I didnt have any statistics on the subject. 921 Q. What percentage have you of the English roads? — A. I couldnt tell you that. Q. What percentage have you of the German railroads? — A. A small perentage in Germany, I should say. Q. Wliat percentage have you of the Russian railways ? — A. I dont know that we have any in Russia. Q. What i:)ercentage have you of the Austrian railways? — A. I dont know that we have any there. Q. Or in Switzerland ? — A. We have some in Switzerland. Q. What percentage? — A. I dont know. STEINBRENNER. 453 Q. What percentage of the South African railroads ? — A. I couldnt tell you that. Q. Well, then, you dont know much about the percentage except in France and Italy? — A. That is about it, yes. Q. About what percentage have you of the French railroads — the mileage? — A. Quite a large percentage; I couldnt tell you just what. Q. Wliat do you mean by " quite a large percentage " ? — A. Well, possibly half. Q. How about the Italian railroads ? — A. I dont know. Q. Now, you got your Central of Georgia contract at 85 cents or 88 cents, I think it was. From January, 1904, to January, 1905, at 88 cents. Didnt you ? — A. I think so. 922 Q. May 1, 1906, you increased it to $1.25, didnt you?— A. Yes sir. Q. Your contract with the Big Four on January 1, 1898, was $1.18, wasnt it ? — A. I don't know ; I dont recall. Q. You have increased that to $1.35, ha vent you? — A. Yes. Q. Your contract with the Toledo, Peoria & Western of January 1, 1904, to May 31, 1905, was $1.0492, wasnt it?— A. I presume so. Q. You increased that in 1905 to $1.30, didnt you? — A. I suppose that is the case. Q. The Grand Trunk you have increased since 1900 from $1.35 to $1.50, havent you? IMr. MiLBTJitN. That is the guarantee you are talking about now? Mr. EIellogg. Yes. A. $1.35 to $1.60, I think it is. Q. $1.60. Well, maybe it is. Chicago Great Western has been in- creased since January, 1899, from $1.57 to $2.75, hasnt it? — A. I dont recollect the change in that contract. Q. The Vicksburg, Shreveport & Pacific has been increased since 1900 from 95 cents to $1.30, hasnt it? — A. Yes sir. Those increases on locomotive service may be due to taking some off the guarantees on cars and adding it to the locomotive service in order to equalize them. It doesnt necessarily mean an increase in the gross guarantee to the railroads. Q. Well, we will see. The Cincinnati, Hamilton & Dayton, 923 you have increased your engine guarantee from $1.53 in 1905 to $2.50 in 1906, havent you ? — A. I suppose so. Q. The Norfolk & Western Railroad you have increased since 1900 from $1.20 to $1.60, havent you?— A. I think so. Q. The Lake Shore road you have increased since 1901 from $1.50 to $2.00, havent you ?— A. Yes. Q. The Detroit, Toledo & Ironton you have increased since Janu- ary 1, 1901, from $1.72 to $2.15?— A. T dont recollect as to that road. Q. The Philadelphia & Eeading road you have increased since 1905 from $1.75 to $2.50, havent you?— A. No. Q. What is the increase? — A. I think the present guarantee is $2.20, with a sliding scale downward. 454 STEINBEBNNEE. Q. $2.25, isnt it? (I read the wrong figure.)— A. Well, $2.20 or $2.25, with a sliding scale downward. Q. Didnt you increase the passenger from 15 to 33 also? — A. I dent remember that part. Q. The Central Railway of New Jersey you have increased since 1905 from $1.60 to $2.25, havent you?— A. I think so. Q. The Hocking Valley in 1906 to the present time, $1.76 to $2.16? — A. I dont remember that one. Q. The Chicago, Eock Island & Pacific since 1903, from $1.33 to $2.50?— A. Yes, I think so. Q. The Lehigh Valley, since April 30, 1904, you have increased from $1.50 to $2.25, havent you?— A. That is correct, according to my recollection. 924 Q. The Cliicago, Milwaukee & St. Paul, since 1903, from $1.40 to $1.70?— A. Yes. Q. The Illinois Central, since 1905, from $1.6722 to $2.20?— A. Yes, I think that is right. Q. The Southern Railway, since 1900, from $1.70 to $2.10?— A. $2.10 is the maximum, I think. Q. What is the minimum? — A. As low as they can make it. Q. Well, that is the guarantee, isnt it? — A. That is the maxi- mum to them. If they accomplish a lesser figure, the guarantee is less. Q. Oh, you have a different contract with them? — A. Yes. Q. Than you have with the others. The Northern Pacific has been increased, since 1903, from $1.60 to $2.75, hasnt it? — A. Ac- cording to my recollection. Q. And the passenger car service from 9 cents to 20 cents? — A. Yes, I think so. Q. The St. Louis & San Francisco, from 1904, from $1,805 to $2.25? — A. I dont know about the St. Louis & San Francisco. Q. That is in Waters-Pierce territory, is it? — A. No sir. Q. You can make up a statement showing the increases and de- creases in the guarantees of these eighty- one roads, cant you, for the last ten years? — A. I dont know. Mr. Mii.BURN. It would take an examination of every contract for the last ten years. Witness. If I could, it would be a gigantic task. Q,. The Cincinnati, New Orleans & Texas Pacific you in- 925 creased since 1903 from $1.33 to $1.72, didnt you ?— A. What was the decrease in passenger and freight cars there? Q. Freight cars, the decrease was .23 of one cent, and the increase in locomotive mileage guarantee was from $1.33 to $1.72. — A. Usually one cent on freight cars is equivalent to about 12 cents on locomotives. Q. This WHS .23 of one cent.— A. Well. Q. The Kanawha & Michigan Railroad you increased from $1.7133 in 1898 to $2.4(; in 1905.— A. I don't remember that one. Q. You don't remember? — A. No. STEINBEENNEB. 455 Q. And increased the freight equipment from $.0745 the same year to 10.20 in the year 1905. — A. I don't remember that. Q. Chicago, Indiana & Southern road from $1.25 in 1903 to $2.00 in 1906. Do you remember that? — A. I don't remember it. Q. The freight equipment from 7^ cents, the same years, to 8 cents. — A. I don't remember it. Q. Well, the majority of these seem to be increases rather than decreases, don't they, throughout the United States? — A. The ma- jority of those you have read seem to be. Mr. MiLBUEN. All of them. Q. Now, isn't it a fact that with the great miijority of all the rail- roads in the United States you have increased the guaranty in the last five or ten years? — A. No. Q. "Will you please make up a statement showing the increases and decreases during tlie last ten years on the 81 railroads of 926 which you made this statement? — A. I don't laiow whether the records can be produced for ten years. Q. You keep books showing these guarantees, don't you ? — A. Yes. Q. And your books show the settlements each year? — A. Yes. I don't know that we have preserved the records for the ten years. Q. And those settlements show the mileage guarantees, don't they?— A. Yes. Q. Therefore, your books must show the mileage guarantee each year? — A. If the records have been pre^^erved, I suppose we could do it. Q. Well, your books have been jd reserved for ten years back, haven't they? — A. No. Q. They have not been destroyed, have they? — A. They have. Q. They have ? — A. Yes, some of them, that we don't keep at all. Q. Well, make it back as far as you can. — A. All right. Q. Give the period of each contract and the increase or decrease in the mileage guarantee. Mr. MiLBTjRN. You call upon us with great liberality. Q. Now, the consumption of oil by the railroads has veiy largely increased in the last few years, hasn't it ? — A. Yes. 927 Q. And the invoice price, or the net price, the guaranteed price, has increased in the last five years? — A. In some cases. Q. Well, in the majority of cases, hasnt it? — A. No, I dont think so. Q. Well, your statement will show. — A. Yes. Q. Isnt it a fact that in the case of four-fifths of the railroads the net invoice price has increased ? — A. I think not. Q. Do you know it is not so? — A. No, I wouldn't say it was not so. Q. Very well. — A. But I think not. Q. You just think not? — A. Yes. Q. You have made no figures to show that ? — No, sir. Q. Well, how do you know that you have lowered the cost during the last four or five years to the railroad companies? If the amount of oil has increased, the guarantees have increased, and the net price 456 STEINBRENNEE. paid for tlie oil has increased, how do you know you have reduced the cost of lubrication? — A. From the very beginning of our contracts we have reduced the cost. Q. Oh, from the very beginning, twenty-five years ago, of course you have reduced them. — A. You dont have to go back twenty-five years to determine that. Q. Well, five or ten years. — A. The cost has been reduced 928 on many lines. Q. On the majority of lines the cost has increased — on the majority of lines? — A. Yes, because of the increase in power. Q. And they have increased the amount of oil, too, havent they ? — A. Yes, necessarily. Q. So that the actual cost of lubrication in the majority of cases in the United States has increased ? — A. The unit of work performed with that you can consider. Q. Well, I understand. What do you mean by the unit of the work ? — A . The cost per thousand miles of tonnage. Q. Yes sir; and that has increased also, hasnt it? — A. I think not. Q. Do you know it has not? — A. From general observation I would say it has not. Q. Isnt it a fact that in four-fifths of the cases it has increased ? — A. No. Q. You dont know that it hasnt, do you ? — A. It has in some cases, in others it has not. Q. In the majority of cases? — A. I would not say the majority of cases. Q. Well, you dont know that it is not true, do you ? — A. Yes. Q. Can you make up a statement showing that? — A. I think we could produce some statistics to show it. 929 Q. On these eighty-one railroads, say. — A. Well, I dont know that we can do it on all of them, for a period of years. Q,. You simply give now your general idea? — Yes sir. Q. You dont laiow how much tonnage was hauled by the railroads per thousand miles of engine run, do you ? — A. We do in some cases. Q. Do you keep those statistics in all cases? — A. Yes. Q. You have the total tonnage haul for ench locomotives thousand miles nm? — A. Not in that way. Q. No?— A. No. Q. You furnish certain blanks to the railroads, dont you? — A. Yes. Q. And the blanks have nothing on them whatever about tonnage hauled? — A. No. Q. Do they make reports to y