War in Container

A slim, blondish young man of 34 who is a Yale graduate and a member of the best Chicago clubs, and a heavyset, powerful man of 49 who was born in Osage Mission, Kan., last week were pitted against each other in the bitterest corporate war of the year. The young man was Walter Paul Paepcke, president of Container Corp. of America. The older man was John Paul Brunt, a director of Container Corp. Mr. Brunt is also executive vice president, although Mr. Paepcke has requested that, until his contract expires five years hence, Mr. Brunt take an "enforced leave of absence."

From his new offices on the 16th floor of the Conway Building, Mr. Brunt has deluged Container shareholders with literature containing charges that President Paepcke has mismanaged their company, should be ousted. It is no secret that Mr. Brunt will seek to become Container's president if he overthrows Mr. Paepcke at the annual meeting March 26.

From Container Corp.'s offices on the ninth floor of the Conway Building, President Paepcke has sent shareholders letters answering the charges against him. To the Brunt argument that bad managerial policies have caused a fall in Container Corp.'s shares, President Paepcke said: "It is apparent that the decline . . . was in accordance with powerful general business conditions and paperboard industry influences, rather than due to some particular policy within this corporation."

Loud have been Mr. Brunt's protests against the expansion policy of Container Corp. President Paepcke answered: "It is very easy to comment on the wisdom of our judgment in the light of after events, but it comes with ill grace from one who voted in favor of each acquisition before it was made."

Other of Mr. Brunt's charges are that Mr. Paepcke's interests as president of Chicago Mill & Lumber Corp. conflict with his interests in Container Corp.; that Container Corp.'s policy of big volume at low prices has been disastrous, hurt its product; that the management should be held liable for buying the company's own stock at prices higher than the present market.

To each of these contentions Mr. Paepcke has made an answer. Nor has he remained on the defensive. "You should know that Mr. Brunt is engaged under the name of Brunt & Co., of which he is president, in a brokerage business in paper products," said a recent Paepcke communication to stockholders. ''That he has recently expanded the operations of this company and is now actively soliciting the customers of this company in competition against the Container Corp. of America."

In the midst of the fight, last week Container Corp. issued a statement showing earnings of $105,000 last year against $826.000 in 1929. ". . . Fairly satisfactory during the first ten months of the year." said Mr. Paepcke. "I am confident of victory."

But also said Mr. Brunt to friends: "I am confident of victory."

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