Owl Drug back from bankruptcy with a slightly different name 1934

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Owl Drug back from bankruptcy with a slightly different name 1934 - "We have then, this situation: The Owl Dru,g...
"We have then, this situation: The Owl Dru,g company going through Bankruptcy after the stage had been properly set and using the processes the bankruptcy court known to the judge, to retire its preferred stock, scale down its leases, pay off a mere percentage, of its general claims and wind up after bankruptcy, owned by the previous owner, doing business under under a slightly changed name (Owl Drug Co.), with the same officers and manager; a fraud of a most pronounced character which allows a debtor to divest divest himself of his burdens and retain his property. Hits at Judge "The fraudulent plan was well devised devised and the court easily fell in with it. In truth it may be said that the judge did not function as a court at all. In all parts of the proceedings, he stamped judicial approval upon every step taken by the original conspirators conspirators and denied all attempts to set aside the bankruptcy or to take it from, his jurisdiction." The conspiracy, as outlined by Neblett, Neblett, was disclosed by several alleged facts he cited: from and she from each the and tion of "Several days prior to the bankruptcy, bankruptcy, Evan Williams of the law firm of Chickering & Gregory vifi- ited Reno. On this trip he interviewed Wingfield, who introduced him to Woodburn and later in the lobby of a hotel in Reno discussed with. Judge Norcross and Wingfield the appointment appointment of the Wingfield bank, Bank of Nevada Savings and Trust company, as the receiver. Having prepared the ground he went hack to San Francisco. "The bonding company at San Francisco Francisco (the National Surety company) was informed from Reno that the Owl Drug company was going to be adjudicated adjudicated a voluntary bankrupt; and what iond the court would require, and who the receiver would be, two days before before the case was brought to the judicial judicial attention of Norcross." Speed Essential Neblett said it had been predetermined predetermined that George K. Edler should be trustee. With reference to Judge Norcross' revocation of the reference of the case to Miss Felice Conn, federal bankruptcy referee, Neblett said, "at ttiis point speed was essential. Something Something had to be done at once to head off the appointment of John Blum by Miss Conn (as trustee), or the estate estate would be irretrievably lost to Woodburn, one of the attorneys for .he receivers and a proposed attorney attorney for the trustee, and the plan of operation and sale of the business, in the manner in which it wa&eventually carried out, would have been frustrated." frustrated." While Judge Norcross testified earlier earlier that Miss Cohn's testimony at San Francisco was inaccurate, Neblett said, with the exception of one point "her testimony was in substance and legal effect true." Neblett traced the financial condition condition of the company as follows: "Until the business was sold on September 30, 1933, for $1,550,000 to the Union Holding company, which then changed its name to Owl Drug company, it was run as usual under iias the and for by Ed he a the management of William Berg through the agency of the Owl Drug Holding company. Assets Drop "The assets of the Owl Drug company company (the original company) as shown by the balance sheet of October October 1, 1932, just one year pvior to the sale, were $13,801,400.54. Ten days later, the date of the adjudication adjudication in bankruptcy, schedule B in the list of properties and assets of Owl Drug company filed with the voluntary petition showed $8,704,651.89. $8,704,651.89. Appraisers valued the property property oh the same date at $3,064,620.63. There is nothing included in the inventory inventory and appraisal except quick assets consisting in the great part of merchandise at cost. "Conclusive is the fact that Edler was a mere figurehead or superstructure superstructure imposed- upon the business. He had nothing to do with its operation. He seems to have done some work in furtherance of the inegal| act of the trustees in scaling down leases for the ultimate benefit of the previous owners of the business and thus contributed to that overt act in the accomplishment of the conspiracy. The remainder of his activities consisted of receiving cash that came in from sales and of kiting kiting checks back and forth between himself, as trustee, and Owl Drug rlolding company, as operating agent." Aside from the Owl Drug case, Meblett said, "the claimed graat record record of Judge Norcross as a trial and appellate judge has been fro quently referred to by his counsel in explanation of his conduct. In answer to this, we cite his appointment appointment of A. T. Schurr, an ex-convict, as a receiver in two cases."

Clipped from
  1. The Salt Lake Tribune,
  2. 13 May 1934, Sun,
  3. Page 5

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  • Owl Drug back from bankruptcy with a slightly different name 1934

    wehopewiki – 10 Aug 2014

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