Rockefeller v. Stewart

Fifteen rounds having been fought (TIME, Jan. 28 et seq.); the fight to a finish between John Davison Rockefeller Jr. and Col. Robert Wright Stewart, minority stockholder and board-chairman, respectively, of Standard Oil Co. of Indiana, continued last week as follows:

Round 16. Col. Stewart and his board of directors declared a 50% stock dividend a $1.12 1/2 cash dividend (including a so-cent extra dividend), thus calling attention to their ability to put fat profits into the hands of the stockholders. During the brief speculative flurry which followed, Standard Oil of Indiana achieved the stock market (paper) value of a billion-dollar corporation.

Round 17. The Sun Life Insurance Co. of Montreal sent proxies for 44,000 shares to Col Stewart. Dartmouth College sent proxies for 2,360 shares to Mr. Rockefeller Jr. Julius Rosenwald, philanthropist and board-chairman of Sears, Roebuck & Co. came out for Mr. Rockefeller Jr. with the statement: "It was fitting for stockholders in any enterprise to see that the business is managed by officers whom they can trust." But Philanthropist Rosenwald's influence was moral, not financial. He owns no stock in Standard Oil of Indiana.

Round 18. As a member of the Rockefeller proxy committee, Winthrop Williams Aldrich announced that he and his colleagues held proxies for 51% of the stock of Standard Oil of Indiana, or enough to enable Mr. Rockefeller Jr. to win the fight and oust Col. Stewart. Mr Aldrich is a son of the late Senator Nelson Wilmarth Aldrich (oldtime friend and intimate of Mr. Rockefeller Sr.) . . . the younger Aldrich now attacks for his impregnable brother-in-law.

Mr. Aldrich is an able lawyer-member of the Manhattan firm of Murray, Aldrich & Roberts.

Round 19. Another able lawyer is Frank J. Hogan of Washington, D. C. He could write an authentic, an exhaustive, history of the Oil Scandals-from the point of view of Edward L. Doheny,* Albert Bacon Fall, Harry Ford Sinclair, Col. Stewart.

As lawyer for Col. Stewart, Mr. Hogan replied to Mr. Aldrich's announcement of Rockefeller proxies with a sophistry. Said he: "If, therefore, Mr. Rockefeller's associates should succeed, it will mean that numerical strength in shares will thwart the wishes of the overwhelming majority of stockholders."

It was true that Col. Stewart claimed the support of a majority of Standard Oil of Indiana stockholders. But it is also true that the application of Mr. Hogan's reasoning would cause all U. S. business to totter, to go into a panic. It would mean that, in any corporation, the holder of one share would be as powerful as the holder of 10,000 shares.

Round 20. In this round several thousand words were hurled. Mr. Aldrich mailed to stockholders a 69-page pamphlet summing up Mr. Rockefeller Jr.'s objections to Col. Stewart and reviewing in great detail the Stewart conduct for the past seven years. Col. Stewart immediately flayed the Aldrich pamphlet as "a cunningly drawn document . . . nothing less than cowardly and dastardly libel."

The final round will be fought at the annual meeting of stockholders in Whiting, Ind., on March 7. It will be essentially a battle of proxies, though any holder of even a single share (purchased before Feb. 5) is entitled to be present and vote in person./-

If the Rockefeller representatives hold the whip hand, they will first prevent the re-election of Col. Stewart as a director, thus making impossible his re-election as board-chairman. Then they can proceed either with iron hand or with compromise. The present board of directors and President Edward G. Seubert are all pro-Stewart men. To oust them and elect pro-Rockefeller directors might create a too sudden confusion in Standard Oil of Indiana. To re-elect them would be the height of compromise-a pro-Stewart Standard Oil of Indiana without Stewart. Much depends on what man, if any, is the Rockefeller candidate for chairman ot the board of directors.

*Lawyer Hogan was reputed to have received $1,000,000 for successfully defending Oilman Doheny in the Doheny-Fall conspiracy trial.

/-Karl August Bickel, president of the United Press assured himself of a ringside seat by purchasing five shares of Standard Oil of Indiana, five minutes before the closing hour.