Morning Oregonian., July 09, 1915, Page 13, Image 13

TTIE MORXIXG OREGOXIAX. FRIDAY, JULY 9, 1915.
1.1
CASHIER
COMPANY
WITNESS IS HEARD
First Testimony Is Taken in
Trial After Attorneys
Address Jury. r
INDICTMENT IS ASSAILED
31. L. Pipes, in Opening Statement
for All Defendants, Declares Ex
penditures Will Show Good
Intent and Disprove Fraud.
(Continued From First Page-
only, the motive that actuated these
men was a bona fide belief In their
ability to make a great business enter
prise of the manufacture of these coin
machines, -which were fully protected
to the stockholders; and that ther were
fully Justified In holding; the belief
that the manufacture of the machines
would bring large profits for the stock
holders. The concern" which the learned at
torney for the United States has de
scribed as "defunct has only changed
its activities. It is a large and grow
ing concern that is already manufac
turing one of these .machines, one of
the two types that tne United States
Attorney called valuable. We will
demonstrate here in this court the effi
cacy of the machines actually manu
factured." Patent Dates Questioaed.
Mr. Pipes said that unforeseen obsta
cles had caused unfortunate delays in
manufacture of the machines. In reply
to the statement by United States At
torney Reames that he would prove
that when representations were made
in newspaper advertisements in Octo
ber, 1911, that the company owned
patents to all its machines, applica
tions had not even been entered. Mr.
Pipes said the best answer he could
make was to show a patent paper
granted on the so-called "bank cashier"
machine, issued February 28, 1911. and
the application for which was filed
October 12, 1909. He showed where
another patent had been issued on Octo
ber 20, 1914, how two patents had
been obtained in France. two in
Austria and two in Mexico.
"I have mentioned this to you," said
Mr. Pipes, "merely to ask whether men
who intended merely to sell stock
would go to the expense of paying
$10,000 to the patent office. It is an
evidence of their good faith."
He told also of n;any other claims
for patents on other machines, which
he said would be shown in the trial.
Ada Written by raid Man.
Referring to the two-page, paid ad
vertisement published in the news
papers in October, which declared the
company fully controlled patents to all
its machines, Mr. Menefee said it would
be proved that this advertisement had
been written by a professional adver
tisement writer employed for the pur
pose. "He wrote these ads and made the
statements, which were not intended
to be made, as 1 will show you, said
Mr. Pipes. "Before October. 1911. for one
entire year, all other advertisements of
' the company had truly stated the situa
tion, and good faith is further shown
by the fact that advertisements after
wards also truly state the situation."
Referring to tho charge that assets
and liabilities had been falsely repre
sented, and that stock that had been
sold was not listed as a liability but
as an asset, Mr. Pipes again waxed
eatirlcal.
Patent Value I pfaeld. ' -
"If the United States Attorney had
his way." he remarked, "he would list
liabilities of J1.OUU.000 against a com
pany with a paid-in capital of J. 1.000,
000. He would, therefore, have a com
pany insolvent that had Jl. 000.000 and
owed no debts. We will show that the
statements of liabilities and assets are
substantially correct. The United States
Attorney has cited the fact that the
Potter machine patera, after being
abandoned as impracticable, was listed
as a $120,000 asset as evidence of mis
representation. The machine didn't
work, it is true, but the patent was
worth that money to keep.
"We shall prove that every dollar paid
in by stockholders was paid into the
treasury of the company and went into
the business."
He declared the defendants had been
actuated by the most altruistic motives
of benefiting the stockholders" when
they procured the stock of the com
pany which they later sold.
"As in every other concern, men got
stuck and found they couldn't carry
the stock they had taken," said Mr.
Pipes. "When this stock began to float
around on the street, some of the de
fendants bought It to save the market
for the other stockholders."
Company Held to Be Solvent.
Mr. Pipes then spoke of the financial
condition of the company. "The United
States Attorney." he said, "told you
the company owed J98.000 and had just
63 In cash on January 31. 191. leav
ing you to infer that it had gone to
smash. I don't know why he didn't tell
you the rest, but 1 presume it must
have been because the learned attor
ney for the Government did not know,
and with all the resources of the Gov
ernment had not been able to find out.
"A year before this tirr.j . cites, of
ficials of the company had decided to
take the company to Indiana for pru
dent business reasons. There it would
be in the center of the Kastern manu
facturing region, back wherethe big
maraei is ana wnere material is cheap
est. A bonus of $12,000 was offered if
the plant were removed to Indianapolis.
bo this company transferred to the
Indiana company its patent rights and
sent all its models and machinery. It
holds three-fourths of the stock of the
Indiana company for the benefit of its
stockholders, and besides this retains
all its real estate holdings.
"Instead of this company's being de
funct, it is alive and very active."
Mr. Pipes cited the extra shipping
cost from Portland to the central
states, $24 on each machine, as enough
to warrant the removal of the company
to Indianapolis.
R- A. Home Called Tronblemaker.
"After it was proposed to move it to
Indiana," went on Mr. Pipes, "R. A.
Hume, a disgruntled man who wanted
to blackmail the company, bought ten
shares of stock and brought the com
pany into court in an action for ap-
pointment of a receiver and for an in
junction to prevent the removal of its
property to Indianapolis. This started
all the trouble for the United States
Cashier Company."
To R. A. Hume Mr. Pipes further at
tributed the present action in the
United States Court. Hume, he said,
after the State Circuit Court had dis
solved the injunction and dismissed the
receiver, went to the Department of
Justice and stirred up the present case.
"He is the real motive behind the
case," said Mr. Pipes. "An active and
vengeful man, by perseverance and as
siduousness, can do harm to the best
concern on earth."
Mr. Pipes concluded with a brief ref
erence to Mr. Menefee. "The best proof
of his good faith," he declared, "is that
all his proceeds went back into the
treasury and $35,000 of his own money
besides. And Mr. Menefee is a heavier
loser than any of the stockholders, as
fhings stand today."
W. M. Cake, as attorney for Thomas
Bilyeu, director of the company, spoke
briefly.
Mr. Bllyea'a Status Defended.
"Up to absolutely the last act charged
in this indictment." asserted Mr. .Cane,
"Mr. Bilyeu had no more to do with
the affairs of this company than you
or I. . He was a creditor and stock
holder of the company, and conducted
his own business. Bilyeu stands here
not only as having nothing ,to do witn
the transaction, but ai receiving little
of value for his patents, his partners
in the American Cash Record Company
of which the United States Cashier
omiany oougnt jsiiyeu a patent nsrii,
having rece'ved all the 'valuable con
sideration. "Except for $150 for ti actual work
in setting patents. Mr. Bilyeu has never
received a ctnt in money from the oon.
pany. His models cost him $7500 of Mi
own money to make. lie stands her
today nicely as the inentor."
A. P. Dobson, Jittorney for Frank
LeMonn, sales manager, declared that
Mr. LeMonn was not a business man,
that he had no idea of ' bookkeeping
and that all statements about patent
and about financial conditions in the
company made by Mr. LeMonn had
come from the head of the concern, Mr.
Menefee. He said evidence would
show that Mr. LeMonn had no idea of
swindling anyone.
Inventor- Mstlvcs Upheld.
Attorney Lark Bilyeu. in behalf of
Oi A. Campbell, director, said that Mr.
Campbell had not even acquired an in
terest in the company until 1913. and
that he had as an honest Investor put
his own funds into the company to help
meet payrofls.
The evidence will show," said Mr.
Bilyeu. "that on one occasion Mr.
Campbell put In over $3000 to meet
payrolls. A conspiracy to defraud the
public' Never! The evidence will show
that It was done to enable the com
pany to manufacture these machines
and to carry out the purpose for which
it was organized.
A statement in behalf of O. E.
Gernert, assistant sales manager, was
also made by Dan J. Malarkey. his at
torney. "The important question." said
Mr. Malarkey, "is 'what is the issue?
The question Is not patent infringe
ment, nor conduct of the business, nor
over-enthusiasm over -their prospects,
nor anything but whether the defend
ants are criminals in a certain aspect.
Conspiracy In Charged.
"Just one crime is charged that all
the defendants criminally conspired in
December, 1810, to get up a scheme or
device to swindle and to use the mails
as part of the scheme. This means
that they had to get together and agree
in order to conspire. As far as Mr.
Gernert, is concerned, he never con
spired, and never even knew some of
the defendants until the trial opened.
He had never beard of some of the
things charged until Mr. Reames
brought them out."
As B. F. Bonnewell and H. M. Todd,
the other two .defendants, both stock
salesmen, had been passed over lightly
in the opening statement of United
States Attorney Reames, their attorney,
J. J. Fitzgerald, felt he had nothing
to meet and so waived his opening
statement. ,
It was just 3:40 o'clock when- Mr.
Malarkey finished. The trial proper
then. began with the calling of Frank
Gloyd to the stand by the Government.
SALEM GIRL IS MISSING
Father in Portland Seeking Grace
Baker, Gone for a Week. ,
A week ago today Grace Baker, aged
17 years, left her home on a farm 14
miles from SaJem to attend the Cherry
fair.. A ticket and $1.50 were given her
by her father and she should have re
turned at 5 o'clock that evening, but
no trace has been found of her since.
Villiam Baker, the father, was In
Portland yesterday to appeal to the
police of this city to aid in locating his
daughter, who he. thinks may have
come to this place to visit friends. He
tears that his daughter may
spirited away, or tha
foul play.
The girl was described as small o!
stature, weighing about 110 pounds,
with dark hair and complexion and
black eyes. When last seen she wore
a blue and white 'striped dress, a light
hat. and no coat. She was an attractive
girl.
PUPILS TO BE INSTRUCTED
Parts in Liberty Bell Parade to Be
Explained by Mr. Krohn.
This morning at 9 o'clock at the Ladd
School pupils from all the West Side
public 8-hools, excepting Failing, will
meet with Robert Krohn to receive in
structions regarding the part they will
take in the parade when the Liberty
Bell is in Portland Inly 10.
The pupils of the Southeast section,
which includes the Lents. Woodmere.
Arleta, Creston and Woodstock schools,
will be instructed by Mr. Krohn this
afternoon and at the Arleta School at
1:15 o'clock.
That there will be an enthusiastic
and large gathering of school children
to greet the historic relic upon Its ar
rival In Portland was demonstrated by
the numbers that met for organization
yesterday and Wednesday.
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SCENE IN UNITED STATES DISTRICT COURT WEDNESDAY DURING EXAMINATION OF VENIREMEN TO SELECT JURY IN TRIAL OF
SEVEN OFFICIALS AND SALESMEN OF UNITED STATES CASHIER COMPANY.
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. FEDERAL JIDGE BEAK IS SEE
FIUS ARE CHANGED
"The Ace of Hearts" Frontier
Romance at Sunset.
PROBLEM PLAY AT STAR
"The Fruit of "Folly" National Of
fering; Orpheum Has Circus Play
- and Varied Projramine Is
Kunnins at Majestic.
"The Ace of Hearts." the headliner
for the blended Sunset programme, is
a frontier film romance, in which Wal
ter Edwards aa Jean Desmond la ac
cused of the murder of the father of
his sweetheart. By strange coincidence
a piece of an ace of hearts that la
found corresponding to the part found
in the hand of the dead man leads to
the confeaslonof the real murderer.
Another attraction, "The High Cost
of Flirting." Is a clever comedy In
which a man pays an amusing price
for ridiculous trilling. When he dis
covers that his daughter and her suitor
that he has refused know of the affair
be gives his consent to their marriage.
"The Fortification Plans." a detective
drama in which an officer is detected
in an attempt to ruin his rival, and
"The Old-Fashioned High Chair." fea
turing Gladys Rockwell and W. E.
Lawrence, are the other two attrac
tions. "FTtUIT OF FOLLY" OFFERING
National
lias Film in Series
of
"Who Pays?"
"The Fruit of Folly." one of the
"Who Pays?" dramas, with Ruth Ro
land and Harry King featured, at the
National, Is an Interesting number of
the series which leaves one In doubt
as to who really pays for the follies to
which each character, in an individual
way, is addicted. Catastrophe's result
from the sins of some of the cast, the
carelessness of some, the greed of some
and the credulity of others.
In This play Cora Is an Interesting
character who Is crafty. yet too
credulous of a villain, who. besides
being dishonest, is addicted to a cos
mopolitan collection of affinities. The
wife trusts Cora, who steals the secret
confided by her husband, who drinks
too much. Many faults depicted In
the film lead up to the puzzling climax.
"Who Pays?"
"She's a Pippin." an eventful com.
ed. and special I'd the travel features
complete a good show.
PROBLEM PLAY IS AT STAR
Photo-Drama Tragically Shows How
Woman Always Pays.
Completing tha week at the Star 4s
one of . the recent problem photo
dramas. "The Woman Always Pays."
The principal characters are a man,
his wife. Helen, their baby and his sis.
ter. Alice. To shield Alice. Helen gets
into an embarrassing predicament, and
though guiltless. Is ordered from home
by her husband, who later becomes the
Governor. Helen declines until she is
a part of the vice Interests.
Meanwhile, the daughter has grown
up and while returning from school Is
abducted and taken to the house where
Helen Is. The mother. In an attempt to
save the girl, shoots the leader of the
gang. In the following raid, Helen is
arrested and. concealing her identity,
is convicted. The Governor, rather
than risk disgrace, keeps silent, bat la
about to aend her pardon, when a-ele-gram
comes. The film closes with Helen
dead In her cell.
"One Good Cook" finishes the bllL.
MAJESTIC HAS VARIED BILL
ter may have beenJ -
t she has met wlth"He Angel of Spring" Is Story With
"TwlHghtlcep' Theme.
A varied programme at the Ma
jestic Theater is featured by -The
Angel of Spring." a twilight sleep
picture. In this film all la perfect
In the happy home of the newlyweds
except the conflict caused by the hus
band's love of children and the wife's
dread of them. Every time they see
a youngster the husband caresses H
and the young wife is annoyed. How
ever, after the "twilight sleep" scene
the family now of three begins anew
a happy life.
The fable ot "The Change of Cli
mate" la a holeome and amusing
comedy of A man who for a time finds
spirits the only cure for his fancied
malady, but after falling Into the
kindly hands of the Woman's Chris
tian Temperance Union president, on
a country ranc. becomes a butter
milk fiend and a healthy man. "Vic
tory at Seven" is also offered and is
an unusual feature with a plot. It
Is a romantic sort of a film with keen
ideas and good characterization.
ORPHECM HAS CIRCUS FILM
"The Flying Twins" I Story of-J
. Love and Revenge.
"A photoplay with plenty of variety
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STADIMi RKIIIXI) THE BKCII THE SIDE XKABKVr THE JI RV BO
A!VEH!t OK THE VENIREMEN V ! IIKR EXAMINATION.
and action la the new ThauhauaerJ the battlefield, and then placed aboard
film. -The Flying Twins." which boats and carried to Europe, accord
opened at the Orpheum yesterday and Ing to the assertions of Spokane Monte-
remains today and tomorrow. Made-
line and Miriam Fairbanks, who really
are twins, play the parts of the young
sters who are persuaded by Harry La
Pearl and his wife to Join a small
circus. The twins become skillful
trapeze performers and their life is
no small part of the entertainment.
Later the acrobat, who was thwarted
In his desires to marry the cousin of
the twins, and who later married a
circus performer, cannot resist the
temptation to provoke the twins'
father, so sends an anonymous let
ter which lends to their discovery.
There is a realistic clrcua atmosphere
in the film. Bertha Leon Is another
real circus celebrity who appears.
Lorraine Haling lias the important
part of the country girl, cousin of tha
twins.
50 ENLIST AT SPOKANE
Recruitng of Montenegrins and
Serbians. Brought 'to Light.
6POKANE, Wih, July 8. (Special.)
Recruiting operations for the Monte
negrin and Serbian military forces have
been actively carried on In Spokane
during the last few weeks.
Approximately St Montenegrins and
Serbians already have left this city to
help fight against the German forces
as the result. It is asserted, of the ac
tivities of agents of Jovo Mantanovlch
and P. M. Luburlch, alleged Montene
grin recruiting officers, now held at
Portland under bonds of J 10.000 earh,
charged with violating the neutrality
of the Unltrd States, Some boya In
their "teens" and men past'mlddle age
are preparing to go.
Furnished with HO and a ticket, the
men are directed across tha Canadian
border to Montreal, where they are out
fitted with clothing and necessities for
w.
V ' . 'w I ...
Advance Demonstrator has arrived by express and
will be at our salesrooms Friday and Saturday for in
spection and short rides.
You cannot afford to miss seeing it. -
Greatest value in 1916 market. "Wonderful power.
Finest finish.
$1050
F. O. B. Detroit
Oregon Motor Car Co.
Chapman and Alder Street
Frank C. Riggs, President
TV. C Garbe, Secretary and Treasurer
negrina.
DEATH SADDENS MEETING
Rev. It. G. Calllson" Stricken While
Addressing Christian Session.
TUnXF.H. Or, July I. (Special.)
The state convention of the Christian
churches. In session here, moved with
solemnity and quietness yesterday after
the sudden death of Rev. It. U. Calllson.
who was stricken with apoplexy while
speaking and died Immediately.
The programme was continued in
regular order In the afternoon.
The attendance is better than last
year. Itev. A. L. Crlm. of Portland, de
livered a great address last 'night.
Crowds are continuing to come In
and It Is expected that Sunday will see
1100 people present. Friday Is educa
tion day, when the chief speakers mill
be Itev. K. T. I'orler. of alem.Or. :
Professor V. K. Haven, of Kuaene. and
Itev. L. F. Stevens, of Los Angeles, CaL.
Saturday la Christian Endeavor day.
Rev. George larsle. of Portland. Is
chief speaker at night. The convention
will continue until the Mth.
WIFE HAS TWO ARRESTED
Three-Cornered Chase on
Lead Pair to Jail.
Streets
Roy It. Nelson and Miss Dell Kesllng
are In the County Jail as the result of
a three-cornered chase on Fourth street
yesterday. A non-support charge,
sworn to several weeks ago. la held
against Nelson. The woman Is held on
another charge.
Mrs, Nelson, who had complained
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against her husband, declared she saw
Miss Kelmg on Fourjth street yester
day morning and started to follow her.
She followed as far as Yamhill street,
hoping, she says, to sea her husband,
who she believed was associating with
Mlsa Kesllng. Meanwhile, unknown to
her. Nelson himself was following his
wife. She told leputy Sheriff Christof
fereon st noon that her hutsnd seiaed
Tor ttiQ
Smote-"vise
of the Coast
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her. held her until the other woman
"' well out or the way, and then took
to his heels. The wife later had both
arrested.
Ce-e rslsled to ) t fusel 1l. ovT!
In treserles by a Jspsncs eeienit.l hats
seen found, to d ik a hesuntul ro.s
co:ar. but to b harmless hen u.cd in
the mnufifitir. e-f t-,r
YH EN yourhoptoffcrs
you a Gcn'l Arthur
cigar from a box, you in
ftinctiYcly feci. Here's
a man who has the right
idea of hospitality.
Then as the genial fra
grance kind of hits the
right fpot you may be
tempted to keep a box
on hand yourself.
Gold Medal Award
at the
Pa nam a-Pacific
Exposition.
Geri1
ARTHUR
CIGAR.- .CNTS
Also a 3 for a quarter size
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