Zuber v. Micmac Gold Mining Co.

• Decision Date: 08 August 1910
• Docket Number: 651.
• Citation: 180 F. 625
• Parties: ZUBER v. MICMAC GOLD MINING CO. et al.
• Court: U.S. District Court — District of Maine

180 F. 625

ZUBER v. MICMAC GOLD MINING CO. et al.

No. 651.

United States Circuit Court, D. Maine.

August 8, 1910

Lewis &amp Carpenter and Charles F. Johnson, for complainant.

Verrill Hale & Booth, for respondents.

HALE District Judge.

This case now comes before the court on final hearing upon bill answer, replication, and proofs. The complainant, a citizen of Maryland, brings this bill of complaint against two mining corporations, citizens of Maine. It alleges that Thomas W Moore and certain associates, citizens of Massachusetts, owned a substantial majority of stock in the Micmac Mining Company, and that they fraudulently conspired with one Phil H. Moore to dispose of the property in that company for $166,666 and to divide the proceeds among themselves; that they entered into a certain fraudulent contract to organize a new company called the Micmac Gold Mining Company, and to issue and divide the stock among themselves. The bill alleges that the issue of the stock in this new company was fraudulent; that Thomas W. Moore and his associates, as officers of the new company, fraudulently caused stock to be sold to the public for the purpose of securing the purchase money to be paid to the old company. The bill further alleges gross mismanagement of the Micmac Gold Mining Company, and prays that receivers be appointed to manage its property, and to bring suits against the Micmac Mining Company, its officers and stockholders, for the purpose of recovering the fraudulently issued stock in the new company. It prays also for an injunction against the Micmac Gold Mining Company from transacting any further business, or paying its debts, or transferring any of its property; and generally for other and further relief. The bill does not pray for a cancellation of the alleged fraudulent contract nor for the winding up of either corporation, nor for the aid of the court in putting back the parties as nearly as possible in the position in which Thomas W. Moore and his associates found them, nor for any specific relief; nor does it join as parties Thomas W. Moore and his associates; although it prays that a writ of subpoena may issue against them to make them parties if they should come within the jurisdiction. Both the pleadings and the proofs disclose a sharp controversy on questions of fact. Before passing upon these questions it is the duty of the court to consider the character of the bill now before it. Its whole purpose is manifestly to obtain a receiver. In this district, in Hutchinson v. American Palace-Car Co (C.C.) 104 F. 182, 185, Judge Putnam has stated the three essential conditions, compliance with which is necessary to justify the appointment of a receiver:

'First, that the

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