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TABLE IV.- Detail of loan authorizations to companies in the iron and steel industry through June 30, 1940
To pay delinquent taxes, to assist in Direct loan; repaid in full, October
financing the purchase of polishing 1942.
pay delinquent taxes, and for work. $100,000 in March 1935 at request of
borrowers; disbursements totaled
ticipation in which the bank's share
was $10,000; the second and third
tate blast furnace, and for working fully disbursed; the borrower was
placed in receivership in December For working capital..
1937; the collateral securing these
loans was acquired by RFC at fore-
to Pennsylvania-Maryland Mort
gage Corp. for relending to borrower
named; the note was transferred to
RFC in January 1937 and was re
paid in full in April 1937, the second
and third loans were direct loans,
and were fully disbursed; company
was placed in receivership in Decem ber 1938; the collateral was sold by the
receiver and a loss to RFC resulted.
included in proceeds were funds for share $250,000; repaid in full in April
with auxiliar equipment.
working capital, and to purchase a made on this loan and the authorizaForen tube rolling mill.
tion was canceled in May 1936.
Follansbee Steel Corp., Pitts
Hot rolled bars.
Hind Steel Co., Union, N. J... Cold-rolled strip.
Works, Oak Lane, Pa.
Hot- and cold-rolled strip
Medart (Fred) Manufacturing Turned and polished shaft
Co., St. Louis, Mo. (now ing. gray iron castings.
Highland Iron & Steel, Inc.,
Terre Haute, Ind.
McLouth Steel Corp., Detroit,
Co., Sharon, Pa.
To provide working capital and to Direct loan; borrower was newly or
assist in financing the purchase of ganized for purpose of acquiring and plant facilities.
operating idlo facilities owned by American Chain & Cable Co., repaid
in full in December 1942. To refund debt, to purchase new Direct loan; repaid in full in November
machinery, and for working capital. 1941. For payment of delinquent taxes and Direct loan; no disbursements made; for working capital.
company requested that authoriza
tion be canceled in September 1936. To assist in reorganization plan. Direct loan; no disbursements were
made and authorization was subse
quently canceled. To refund bank debt and for working Deferred participation; bank's share capital.
$60,000; repaid in full in November
1941. To improve current position through Direct loan; repaid in full in December
payment of notes and other accounts 1939.
due. To retire bond issue and for working Direct loan; $176,250 of this authorizacapital.
tion was disbursed, balance was
payment of mortgage and other ship at the time loan was authorized;
unrepaid balance of $75,000 was
refunded by second loan.
of participation agreement in August
1942. To assist in reorganization plan by Direct loan; authorization reduced to
payment of delinquent laxes, provi. $315,000 in Feb., 1937; disbursed porsion of working capital, and for mod- tion of loan repaid in full in Septemernization of acetic acid plant.
ber, 1943. For additional working capital.. Direct loan; $22,500 disbursed; balance
of authorization cancelled; disbursed
portion repa id in full in Oct. 1939. Toimprove current position by replen. Deferred participation; bank's share
ishing fundsexpended for capital im. $150,000; repaid in full in Oct., 1939. provements, to add a 30-ton electric furnace, and for working capital.
Newberry Lumber & Chemical Charcoal pig iron, lumber,
and wood chemicals.
Rotary Electric Steel Co., De Ingots, hot rolled products, troit, Mich.
and cold finished bars.
TABLE IV.- Detail of loan authorizations to companies in the iron and steel industry through June 30, 1940—Continued
Tennessee Products Corp., | Ferro alloys, charcoal pig
Nashville, Tenn. (now Ten. iron, coke, coal, and chem. nessee Products & Chemical icals. Corp.)
Wheatland Tube Co., Philadel Butt weld steel pipe.
phia, Pa. Wickwire Spencer Steel Co., Pig iron, plain and galva
Worcester, Mass. (acquired by nized wire, wire rope, fabColorado Fuel & Iron Corp. in ricated wire items, and 1945).
Source: Industrial Analysis Branch, Budget and Reports Division, Ofice of the Controller.
Table V.-Number and amount of loans authorized to companies in the iron and steel industry through June 9, 1950
Type of authorizations:
I Number count does not include the Kaiser Co. refunding loans.
Includes $11,500,000 of new money authorized in Kaiser Co. refunding loans.
DAVIS, POLK, WARDWELL, SUNDERLAND & KIENDL,
15 BROAD STREET,
New York, N. Y., June 2, 1950. Hon. EARL C. MICHENER, House of Representatives Office Building,
Washington, D. C. DEAR MR. CONGRESSMAN: As one of counsel for the defendants in the so-called investment bankers antitrust suit in the Southern District of New York, I was interested to note in the proceedings of the Judiciary Committee's Subcommittee on the Study of Monopoly Power on April 25th, your success in ascertaining from counsel to the Subcommittee the source of four documents offered by counsel "for the record.” This offer was apparently made at the beginning of the hearing that day, and had no relation to any matters being testified to before the Committee. The colloquy appears at pp. 854–7 of the Stenographic transcript April 25th.
The Government's suit under the antitrust laws against 17 investment bankers was commenced in October 1947 and has not yet been brought to trial, although the defendants attempted to begin trial in April. Various efforts have been made by unidentified persons enjoying some connection with the Department of Justice to try it before Congress in preference to trying it in court. I beg leave particularly to call to your attention the following:
1. The four documents placed in the Subcommittee's record by counsel were exhibits for identification 133 and 143 marked on the deposition of John Schiff of Kuhn, Loeb & Co. and 1189 and 1208 marked on the deposition of Monroe Gut. man, of Lehman Bros. Both of these firms are defendants. Neither deposition has been offered in evidence nor have any of the four documents, since the trial has not yet begun.
2. The four documents are dated at various dates between 1927 and 1936, the oldest thus being 20 years before the suit started and the most recent being 11 years before.
3. The complaint in the Government's suit against the investment bankers is filled with general charges of monopoly and urilawful combination. These charges the defendants have denied and expect to show to be false in all material particulars on the trial of the action. While awaiting trial (which the Government has deferred) we protest against any attempt to try the case before Congressional committees, where the right of confrontation and cross-examination does not exist and where indeed Congress does not want the atmosphere and tactics of a trial because they would be no aid to legislation.
I call attention to the fact that, as shown in the index to the last two volumes of proceedings of your Subcommittee, Serial No. 14, Parts 2A and 2B, the inrest. ment bankers suit has nevertheless been brought into the record by reference at least eight times, sometimes by remarks of the Chairman, sometimes by accusation and charges of Cyrus Eaton, a witness whom we doubt that the Government will venture to bring before Judge Medina.
4. The former chief trial counsel on the Government's staff, Roscoe E. Steffen, who framed the complaint, has left the staff and is now a Professor of Law at the University of Chicago. Mr. Levi, who now places in the record of your Subcommittee identification exhibits from the investment bankers case, is a colleague of Mr. Steffen at the University of Chicago. As an instance of the error and misinformation which is bound to creep into your Subcommittee's record as a result of attempting to try before you a case which belongs in the courts I mention in passing Mr. Levi's statement (SM 854) that Mr. Seward Prosser was associated with Guaranty Trust Company; the fact is that he was never an officer of Guaranty Trust Company but was an oflicer of Bankers Trust Company.
5. On March 9, 1950, the defendants formally. moved before Judge Medina to set the case down for trial April 3rd and to begin trial on that date. At that time some 6,000 pages of testimony had been taken by the Government upon doposition and almost 5,000 documents had been authenticated for use on the trial. Yet Government counsel opposed the motion with the statement that they were not ready and needed more evidence. After further pretrial proceedings in which the Government took many measures to obtain delay, Judge Medina has signed Pre-Trial Order No. 2 dated May 25, 1959 with an accompanying memorandum of which I enclose a copy. The order sets the case down for trial October 9, 1950. The memorandum attached shows the extraordinary and ambitious scope and great expense of the action.
Let me reiterate, respectfully and as emphatically as I can, that the defendants desire to try the case; that on the trial they expect to show the falsity of