CHAPTER XIV
LAWYER UNTERMYER DISCOVERS THE "NIGGER"
I have dwelt on this Utah episode because it shows phases of the "System's" methods never heretofore made public, just as episodes which are to follow in the narrative will develop other startling and ingenious deviltries. But, before going on, the sequel to the Utah affair deserves a place in the story. A sequel there was, and my readers will agree, I think, that it has a mordant humor quite its own. To-day, after the years that have gone by, I cannot think of this tremendous bunco game, in spite of its cruel and tragic phases, without a laugh at the manner in which the smart gentlemen who composed the Utah Consolidated crowd were "outwitted." Bear in mind that Clark, Ward & Co. were among the "flyest" operators in Wall Street's juggle factories. They asked no odds of any one in shuffling and dealing their cards, and with them was the eminent Samuel Untermyer, surely the head of his class of corporation counsellors, and himself a master in the fine arts of copper financiering. On the conclusion of the deal, these gentlemen and their partners in Utah assumed all the airs and graces they conceived proper for associates of "Standard Oil," and at once enlarged their hatbands and let out their waistcoats. Some of them, I believe, went so far as to be measured for copper crowns. The stories they set afloat about the richness of Utah, as proved by "Standard Oil's" determination to have its 150,000 shares, would have made the constructor of Aladdin's palace look to his laurels as a treasure-house creator, and the stockholders of the corporation felt so good over their prospects that in London and New York two large banquets were simultaneously given at which the prospective millionaires tossed cable congratulations at one another across the Atlantic and toasted in vintage champagnes the brilliant promoters who had worked such wonders. At these entertainments there was no question but that Utah was destined to be the foundation company in the coming great copper consolidation.
With this roseate view Mr. Rogers did not entirely coincide. His diagnosis of the situation had all that whichever-way-the-cat-jumps frankness I had learned to look upon as characteristic of the man. He said to me:
"Lawson, this is the situation: We are in absolute control of the Utah property. If it were good we could do great things with it, but it's bad, very bad; there is nothing out there but a bunch of ore which is rich enough, but which cannot possibly last longer than six years, and then—then there is nothing but a hole in the ground. Of course there is a possibility of our finding other bunches, but with all the machinery in our hands it looks to me as though we could play a very safe game. If we find things that will make the stock valuable, we can keep the good news buried until we shake the price down and get whatever we want. If it is all bad, we can sell the stock and buy it in at big profits. I think, on the whole, it is safe to call this deal completed and mark it a success."
With this understanding we left it, and for some little time I paid no attention whatever to Utah. One day I was surprised to notice on the tape that the price of the stock was declining. I was puzzling over what could have happened, when I received a sudden call from the Machiavelli of the New York Bar, Samuel Untermyer. The set glare of his eyes, the fervor of his hand-shake, told me that I had a volcano to deal with.
"Lawson," said he, "something came up the other day that led me to investigate, and do you know, I have got to a point already where I can put my fingers on people, outside of any one connected with 'Standard Oil,' who own over 200,000 shares of Utah. If this is so, how can Rogers and his crowd own the 150,000 shares they took away from us at millions below the market? It seems impossible, but it looks as though we had been buncoed—buncoed as no one outside a crazy-house was ever buncoed before."
That steely imperturbability which is alternately the pride and pleasure of Mr. Untermyer's friends, the glittering surface of which it is said no cloud has ever shadowed or no gale disturbed, was fast losing its distinction under the influence of the excitement that welled up in the heaving bosom of the eminent cross-examiner; and excitement and he were so remote, so studiously antagonistic, that I looked on and listened in wonder for the outcome. An interesting situation was evidently fast developing, and to grasp its possibilities one should know the attitude of Mr. Rogers toward Mr. Untermyer. For this astute lawyer the "Standard Oil" magnate has something akin to terrified admiration. Mr. Rogers has said many times to me and to others among his associates that there is but one lawyer in the United States whose cross-examination on the witness-stand could afford him anything but amusement and recreation; and this extraordinary exception is Samuel Untermyer. The bare thought of being subjected under oath to the remorseless questioning of this astute dissector and analyst of motives and actions brings him to the verge of rippling chills. And here was this legal Nemesis on the war-path and headed directly for 26 Broadway.
"What does it mean, Lawson?" His voice was in a court-and-jury key.
The opportunity was too good to miss. I could not help it. I said, "Untermyer, you have another guess coming."
"Do you refuse to tell me anything about it?" he snapped.
"Tell you about it?" said I. "What could I possibly tell you about your own scheme? You flatter me; you are getting excited. Let me ask you a question, What do you say it means?"
"I say it means," he fairly yelled, "that we have been buncoed—swindled!"
"If that is a fact," I said, "you are the best man on earth to tackle such a proposition. Introducing swindlers to justice is your specialty."
"Lawson," said he, "let's talk it out. I don't see wherein you are in any way to blame, but I tell you if I find true what I now suspect, there will be music in the copper world that will set copper investors by the ears."
I saw there was no use trying to dodge the issue, and we entered into executive session. He had gathered most of the facts, he told me, and to ascertain the balance, proposed at once to call a meeting of Utah Consolidated stockholders. Also he had men out examining the transfer agencies to find who got the shares of Utah delivered to Rogers.
I said to him, "What do you think has happened, Untermyer?"
"I think you people have sold the bulk of that stock," he said.
"Suppose we have," I said; "there is no crime in that, is there?"
"No crime," said he, "but it is a piece of dirty double-dealing."
"All right, suppose I admit it," said I, "what of it?"
"Well, did you do it? Did you sell that stock after we delivered it to you?"
"Not a share," said I.
"Do you give me your word for it?"
"I give you my word, we didn't sell a share of that stock after you delivered it to us."
"When did you sell it?" said he.
"Every share before we secured it of you."
At this the distinguished impassivity faded finally away and Samuel Untermyer was actually and absolutely flabbergasted. The sight of him dumfounded, confused, was too much for me. I laughed. It is seldom one gets the laugh on Mr. Untermyer.
"Do you mean to tell me you were short the whole bunch?"
"Short every share of it, and 10,000 besides," said I.
"And where do you stand now?" he pursued.
"Still short of it, and before you can get fairly to work kicking up a rumpus I should not be surprised if we were short the whole capital stock. Rogers, as you know, does play a great game, that is, when he has all the cards, owns the table, the room it's in, and has control of the doorkeeper."
There was an interval of tense silence. Untermyer was making a noble effort to swallow his fury. I began to figure the degree of my responsibility if he should burst a blood-vessel or have an apoplectic stroke. Finally he said:
"Lawson, if I don't blow this thing to pieces and shake 26 Broadway to its foundations, I'm not Sam Untermyer."
The time had come to reason with the heated legal gentleman, and in plain language I proceeded to show him where he stood, the position of the property, the public's relation to it, and his own duty to the clients whose money he had invested in it. Under the logic of my argument he cooled. He saw the net, and that he and his friends were absolutely enmeshed. He even admitted that he and his friends had unknowingly aided in what had occurred and were mostly to blame for their present position; but while he acknowledged all this, he reiterated over and over again that in all his experience—and in Samuel Untermyer's professional position he has either prosecuted, defended, or had an inquisitorial finger in every sword-swallowing, dissolving-view, frenzied finance game that has been born or naturalized in Wall Street within the decade—he had never met the equal in high-handed bunco of this deal in Utah.
Finally he said: "There's one thing I can do, if I cannot get even with Rogers; and that is, I can 'fire' the present management of this company, and I'm going to do it now, this very minute, and incidentally I'm going to state what I think of them and the whole dirty business."
I called up "Standard Oil" on the telephone and told what had happened. Mr. Rogers said: "Cool him down at any cost, but particularly try to show him I had little to do with the deal; that it was largely the outgrowth of what the Clark-Ward people thrust upon us, and that I left the details to you and the lawyers."
Again I had visions of what would be the cost of making "Coppers" a success.
Within an hour Untermyer was back visibly relieved and glowing after his encounter. He had the resignations in his pocket, and he began joyously to detail the specific opprobriums he had cast upon the management. "I shall put in an entirely new management," he proclaimed triumphantly.
"You have positively made up your mind to that?" said I.
"You bet I have," he answered.
"Excuse me for a few minutes, then," I said; "I want to give my brokers orders to rip out 50,000 or 60,000 shares of Utah. Rogers and Rockefeller would take me to task if I wasted a minute."
"Hold on there, Lawson," he said.
"Not a minute," said I; "you know the game well enough, Untermyer, to realize that there are a few millions hanging very low on the boughs at just this second. I want to get my hat under them before you and your friends have an opportunity to roll in your own hogsheads."
It was no time for diplomacy, and I set forth in plain, dog-eat-dog terms to Mr. Untermyer exactly where he was "at," and that no one but himself and his associates would be the sufferers by a public explosion. Reluctantly he agreed with me that under no conditions must the "Standard Oil" management be changed, but he was bound to have one victim to show.
"You have the resignations of the present board—why not put in new men, the strongest 'Standard Oil' men you know?" I suggested.
"I'll do it," he said, "but I'll throw out the present president, blame him for all that's happened, but—whom shall I put in to replace him? How about Rogers himself?"
Knowing Mr. Rogers' cross-purposes I was sure he would never become officially responsible for the company; so I told Untermyer this was impossible, but I continued: "The next best man and the closest I know to Rogers is Broughton, his son-in-law. There's your president."
Whereupon Broughton was elected president of the Utah company. The stock has since dropped from 52 to 22, gone from 22 to 37-1/2, dropped to 18-1/2, with frequent repetitions, and is now 43: and all the drops have been preceded by tremendous short selling, followed by stories of the absolute worthlessness of the property; and all the rises, by tremendous buying and stories of the mine's fabulous richness. Some one has made millions.
"Standard Oil" is ever ready to forgive and forget those it has injured, but it has power and place for those who have made it tremble. Its associates to-day are often yesterday's enemies. As one looks back upon the Utah episode from over the divide, it helps accentuate its humor to contrast the present attitudes of the parties engaged with those they then held to one another. We now see the virtuously indignant Samuel Untermyer shoulder to shoulder with his wicked betrayer, Henry H. Rogers, whose counsel he is against the original ally of the same Henry H. Rogers, Thomas W. Lawson, historian of "Frenzied Finance." And the talented expert, most trusted of "Standard Oil" mining emissaries—Broughton, whose unfavorable report on Utah Consolidated was the instrument of the plundering of the Clark-Ward-Untermyer contingent—elected president by Samuel Untermyer, has remained ever since at the head of the property he had pronounced worthless.