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The Register Publishing Company In Court

The Register Publishing Company In Court image
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Wednesday. afternoon a bilí was filed in the circuit court to determine the ownership of the Ann Arbor Register and to bring about a settlement of accounts between Mr. Moran and the Corporation. The bill sets forth that S. A. Moran, June 20, 1S89, purchased a half interest in the Register, and in the presses, type, material, etc., in the Register office of Kendall Kittredge for $8,000, the firm being known as the Ann Arbor Register Printing and Publishing Company. In 1890 Moran conceived the project of forming a Corporation to purchase the newspaper and plant and on October 20, 1890, as the result of Mr. Moran's efforts, the Register Publishing Company was organized with a capital stock of $25,000 divided into 2,500 shares. The articles of incorporation show that the original stockholders were S. A. Moran, 660 shares; Mark W. rington, 20 shares; John Moore, 20 shares; it appearing in the articles of incorporation that said shares were fully paid. The articles provided for the election of three directors and the three persons named were elected directors. The by-laws provided for the election of a president, vice-president, secretary and treasurer. The directors were also to appoint a superintendent to be chosen from the members of the board who was to have the general management of the business, frequently consulting with the secretary and treasurer. The three directors met and elected S. A. Moran secretary and treasurer and also appointed hitn superintendent of the Corporation. The biil charges that "Moran conceived the plan of cheating and defrauding your orators long before and at the time said Corporation was orgaaized; that said Harrington and said Moore paid nothing for the shares of capital stock issued to them in said Corporation; that said Harrington and Moore were only nominal holders of said stock and received the same at the request of said Moran and voted and acted according to his suggestion; that in trutli and fact the first board of directors were chosen and elected by said Moran; that said by-laws were drawn by said Moran and adopted at his solicitation and request with the purpose and intention on the part of said Moran to place the control and management of said corporation in the hands of said Moran and give him an opportunity to cheat and defraud said Corporation." The bill sets forth the adoption of a resolution to purchase the plant, stock and good will of the Register Publishing Company, exclusive of the Ann Arbor Register subscription list, and the ordering of an appraisement, which was made by YV. G. Smith, of Marder, Luce & Co. The 3Ü1 charges that Smith was appointed appraiser at Moran's request and that the appraisement exclusive of the Ann Arbor Register newspaper was made by Smith at Moran's request over a month before the organization of the Corporation. The appraisement amounted to $17,158.25 and the bill charges that this prior appraisement was presented as the appraisement made by order of the board of directors and that it was greatly in excess of the true cash value of the plant, which then did not, exclusive of the Register paper, exceed $12,000. The bill further sets forth that Moran offered for himself and Mrs. Kittredge to sell said plant to the corporation for $17,158.25 and that thereupon the directors accepted said proposition, b ut "that prior to said purchase by said corporation, said Moran had negotiated with said Eunice, W. Kittredge to purchase for the said corporation her undivided one half interest in said ness and plant, including the newspaper known as the Ann Arbor Register and finally about November 26, 1890, purchased for the said Corporation her said interest for the agreed price of 7,000 in payment of which sum he issued to her 100 shares of f uil paid stock in the said corporation and made certain other payments to ot for the use of the said Eunice W, Kittredge, the exact amount of which your orators are unable to state, but the total of which they allege did not exceed the sum of $6, 000." The bill further goes on to charge that such payments were made out of the funds of the corporation and that the corporation, for the $7,000, actually did purchase of Mrs. Kittredge a one half interest in the Register Publishing Company including the newspaper, that Moran now pretends and claims that he purchased Mrs. Kittredge's interest for himself and that afterwards when he was sole owner of the plant, he sold the same exclusive of the newspaper to the corporation for $17,158.25. The bill also claims that the $7,000 was a fair price for a half interest and that Moran did not and could not sell his interest in the plant for a greater sum than S7,ooo. The bill charges that the books have been kept by Moran or some person employed by him, that the newspaper has made a large profit; that no stock account appears on the books and that a large amount of stock sold has never been accounted for by Moran, that since the organization of the corporation in addition to the 660 shares then held by him, Moran has issued to himself 550 shares and to various other persons 801 shares, that 100 shares were issued to C. R. Gardner and in exchange therefore Gardner assigned to Moran 100 shares of stock of the Ann Arbor Electric Light Company which Moran has never assigned to the corporation nor accounted to them for. The bilí further charges that Moran has from time to time borrowed from divers persons different sums of money for the purpose of purchasing certificates of stock in said Corporation and obtaining and retaining a controlling interest in said Corporation, that in particular he borrowed $2,500 from the Farmers' and Mechanics bank upon the endorsement of Koch & Henne and that the money thus borrowed was used by Moran in purchasing for himself 250 shares of the capital stock and that on or about the first of February, 1891, sold Moran without any authorization by the board of directors and without their knowledge, executed and delivered to Koch & Henne, a chattel mortgage on the property of the Corporation, which was not placed on file nor recorded but that about the middle of July, 1893, said first chattel mortgage was cancelled and another given by said Moran upon the same property, which said second chattel mortgage was filed August 5, 1893. The claim is made that this chattel mortgage is invalid . The present board of directors is stated to consist of Alviso B. Stevens, Nathan D. Corbin and Selby A. Moran, that in February last the directors Stevens and Corbin began investigating the affairs of the corjoration but did not become aware of the doings of Moran until within a few weeks. They ask that an injunction be issued restraining Moran from transferring the Ann Arbor Register newspaper, his stock and the Electric Light stock that he ïolds, and also that he be restrained :rom collecting the advertising and subscription accounts on the paper. They also ask for an accounting with Moran and that in such accounting Moran be charged with $3,158.25, the excess paid by the corporation upon the purchase of the plant and that the Register and the 100 shares of Electric Light stock be decreed to belong to the corporation. The bill is signed by the Register Publishing Co., by A. B. Stevens, president. J. W. Bennett, Esq., is solicitor for complainant, with Thompson, Harriman & Thompson of counsel. The injunction asked for was granted by Judge Kinne, excepting that part relating to the collection of subscriptions and advertising.


Ann Arbor Argus
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