It appears without dispute that during the taxable year here involved, ending August 31, 1947, the [WatchTower Society] sold from Kingdom Farm dairy products, poultry and eggs, hides, dairy cattle, and fruits and vegetables of various kinds. Its employees made regular and systematic trips to Ithaca, New York, and the surrounding vicinity, to sell various kinds of vegetables and farm products to restaurants and other commercial users. A truck was sent weekly during the growing season from the farm to the regional market at Syracuse, New York, with a load of products from the farm. This is a public market for the use of farmers (incidentally, created and partially maintained from taxes), and the products of Kingdom Farm were systematically offered for sale each week in open and immediate competition with taxpaying farmers. Dairy cattle were bought and sold in competition with taxpaying farmers at the "Earlville Sales", a widely known and used public auction system for transactions in dairy cattle It produced and offered for sale to the public a variety of kinds of cheese which could be purchased at the farm or be shipped to any purchaser (labeled KINGDOM CHEESE).
According to [WatchTower Society's] own figures (adjusted for inflation and rounded), the value of the total production of Kingdom Farm for the year ending August 31, 1947, was $1,200,000.00, and the value of the production on Carmel Farm (a nearby farm owned by [WatchTower Society] but not directly involved here) was $425,000.00, and the amount sold from both farms was $575,000.00. This is a substantial percentage and its designation as an insignificant surplus cannot be justified.
The sales of poultry and eggs for the year ending August 31, 1947, from Kingdom Farm alone amounted to $215,000.00, and produced a net gain of $145,000.00. It is a fair inference that the reason such enormous quantities of poultry and eggs were produced each year was because such products were readily salable and produced a handsome profit. Similar products sold for the year ending 1946 amounted to approximately the same figure, and for many years large amounts of poultry products were sold. This would seem to eliminate the incidental feature of the surplus and render it an intentional surplus for the purpose of sale. The [WatchTower Society] states in its brief that the large poultry department was established "years ago in anticipation of providing poultry for the institution at Brooklyn headquarters. However, due to the operation of the poultry department on Staten Island, New York City, it never became necessary to make demand upon the Kingdom Farm poultry department for supplies of eggs to maintain the institution." Yet during these "many years" [WatchTower Society] has continued the heavy production of poultry and eggs, knowing well in advance that it had no use for them except for sale. Why were they produced? The obvious answer is to sell and to make money. ...
"HOUSE OF THE PRINCES" SCAM
Over the decades, the WatchTower Society has published as many, if not more, LIES about the construction and maintenance of this southern California mansion as it has about any of its other multiple scams. "Beth-Sarim" was not built for any soon-to-be resurrected biblical "princes", and it was never "deeded" to any biblical "prince" or "princes". Neither was it built to demonstrate a belief in a soon-to-be "resurrection" of biblical "princes". (Even ex-JW "researchers" and authors have repeated one or more of these falsehoods.)
"Judge" Rutherford had been "wintering" in southern California ever since he relocated himself, Mary, and Malcolm, from WatchTower HQ to Los Angeles in 1915 (see our Charles Taze Russell Financial Biography). After Rutherford's relationship with his wife and son fell apart during the early 1920s, Rutherford started wintering in rented properties in San Diego, rather than with or near his wife, or his son and daughter-in-law, in Los Angeles. In San Diego, Rutherford developed an expanding relationship with a father-son pair of chiropractors, named Alta G. Eckols and Albert E. Eckols -- one or both of whom were "followers". (Alta Eckols preached on radio station KFWM.)
Sometime prior to October 1929, Albert E. Eckols purchased two lots in the Kensington Heights subdivision, in San Diego, California -- possibly for around $8000.00. In October 1929, "Judge" Rutherford sent little-known WatchTower Society corporate Director Robert J. Martin, along with unknown $$$$$$ furnished by unknown persons, to San Diego to purchase those two lots from Albert Eckols. (Martin previously had been used as a "straw buyer/seller" by both Russell and Rutherford in various real estate transactions they wanted to keep secret.) Title was transferred to Robert J. Martin from Albert E. Eckols in a deed dated October 8, 1929. Two days later, on October 10, 1929, Martin contracted with the prominent J. W. Gernandt Construction Company for apparently what was to be a "rush job". Gernandt is believed to have sub-contracted renown architect, Richard Requa, to draw the plans for what reportedly was a two-story, 5156 square foot, 10-room, $25,000.00 mansion, plus detached two-car garage for Rutherford's new Cadillac.
On December 24, 1929, a deed transferred ownership of the two improved Kensington lots from Robert J. Martin to Joseph F. Rutherford in exchange for the grand sum of $10.00. That deed specified that Rutherford owned an unencumbered, unconditional "life estate" in the property. Rutherford (nor the remainder person) was not even restricted from encumbering this property. In fact, the deed specifically provided that during his lifetime, Rutherford could by written deed, lease, or contract, grant possession of this property to anyone else he so chose, FOR THEIR LIFETIME, or until a resurrected "prince" demanded possession of the property, whichever came first.
This deed further provided that after Rutherford's death that the "remainder" of the estate was granted to the main Watch Tower Society of Pennsylvania corporation, which was to hold the property "PERPETUALLY IN TRUST" for the benefit of any future resurrected biblical "princes" who might at some point in time choose to relocate to San Diego from Jerusalem. NOTE that despite what the WatchTower Society has expressed or implied for decades, that this "PERPETUAL TRUST", did not kick in until AFTER RUTHERFORD'S DEATH. Additionally, the Watch Tower Society of Pennsylvania was required to own and maintain the property FOREVER -- for whenever a resurrected "prince" MIGHT want to move to San Diego from Jerusalem.
This "trust" was nothing more than "sleight of hand" intended to deceive the WatchTower Cult's gullible and ignorant followers as to whom was the real "Prince" who was intended to benefit from this massive outlay of funds in the very midst of the "Great Depression", and to give those halfwitted Cult followers some sort of ludicrous "biblical" counter-argument to use against those whom confronted them with "the truth" of yet another WatchTower SCAM.
Gernandt turned over the completed project on January 17, 1930, and "Judge" Rutherford moved in soon thereafter. In January 1931, "Judge" Rutherford gave a tour of "Beth-Sarim" to a reporter and photographer from the SAN DIEGO SUN, and proudly posed for photographs both inside and outside his new mansion. Notably, Rutherford boasted to the reporter and photographer that, "In Chicago, a millionaire manufacturer offered to build another house ... but I declined the offer." Here are the descriptive portions (edited) from that 1931 SUN article:
At BETH SARIM (House of the Princes) as Rutherford has named his ... $75,000 Southern California mansion ..., ... [visitors] will find the most modern appliances that science has devised. ... walk up the circular stairway to the second floor, they will find a large office with red leather chairs and shiny flat topped desk and inverted lighting. Even French telephones await ... . Opening a wide door, ... behold a large bathroom, resplendent in shiny black tile with needle shower and amply filled medicine chest. ... gold safety razor and strop!
Rutherford built the second floor bedroom ... large ... . With wide pane windows that look out on the purple Cuyamacas to the east and California's first mission to the north, the bedroom is almost severe in its furnishings [including a fireplace]. ... the austere end tables sported gaily covered, fiction magazines. Rutherford has imported some Koiniach, Wasser from Cologne, Germany ... . ... ...
... The patio with its silver pool and olive and palm trees is gay with flowers. Down toward the canyon, paths have been landscaped ... . ... fruits and trees, native to ... Palestine ... . In the two car garage next door stands a new, yellow 16 cylinder coupe ... .
Rutherford lived at "Beth-Sarim" until his death there in January 1942. "Beth-Sarim" was sold in 1948, but not before a series of legal maneuvers to clear and quiet title, and not before the WatchTower Society first removed its own name from the deed. In 1947, "Beth-Sarim" was titled in the named of Bethelite "straw-man", William Clayton Short, and in June 1948, Short finally sold the property to a non-JW.
"JUDGE" RUTHERFORD EXPOSED and DENOUNCED BY FORMER FRIEND & CONFIDANTE,
FORMER CANADIAN BRANCH MANAGER WALTER F. SALTER
... ... [In Summer 1934,] you made the statement to me and another that you had bluffed all your life. I believe that was one of the truest statements you ever made, and I am now calling your bluff, ... . ... ... So much for doctrine: now a word regarding what I feel constrained to state concerning the corruption otherwise of the Society.
As the scales ... have fallen from my eyes, I have been astounded to see how blinded I have been to your actions -- through a superstition that:
(1) the WATCHTOWER was the Lord's channel of meat in due season for the household of faith, and
(2) that you, as President of the Society, were God's chief servant amongst His people, and
(3) that you being responsible,
(a) [I] should be submissive to whatsoever you required done -- foolishly thinking that I had no responsibility in the matter, and
(b) that anything you did that was wrong, or that I did as ordered by you, the Lord would overrule.
It was with this thought in mind, that I, at your orders, would purchase cases of whiskey at $60.00 a case ($850.00-$1125.00 in 2016 dollars depending on the Prohibition year), and cases of brandy and other liquors, to say nothing of untold cases of beer. A bottle or two of liquor would not do. It was for THE PRESIDENT and nothing was too good for THE PRESIDENT. He was heaven's favorite. Why should not he have everything that would gratify his desires for comfort?
True, I had a part therein. For I partook of your hospitality, or shall I say, the Society's hospitality. For it was the Society's money. But, I partook -- as above stated -- being blinded with the idea [that] THE PRESIDENT was in charge, and therefore responsible, and not I. Today, I see that the thought was absolutely wrong, and that the squandering of the Society's money, in that respect, was a mis-appropriation of funds. ... I should have taken no part therein whatsoever. I confess my wrong before the friends and before the Lord, and ask their forgiveness and His.
Often, as I thought about this extravagance and waste, and then thought of the [difficult living situations] of the pioneers, I was puzzled. But, my conscience was lulled by the belief that the Lord was using you to serve His cause and people, and therefore, I did not, and dared not, say anything that I thought would cause the friends to lose confidence in you as a servant of the Lord. ... ...
The squandering of the Society's money on liquor was only one thing I had cause to wonder over. There were other things. I could not help but contrast with the [difficult living situations] of the pioneers, the luxury that you surrounded yourself with, and the comfort that I enjoyed. And, among these luxuries, I cannot refrain from mentioning the following:
1. Not one, but two 16-cylinder cars. One in California, and one in New York. One would not suffice for THE PRESIDENT, nor would a 6 cylinder car be big enough for THE PRESIDENT. But, a 4 [cylinder] would do for a pioneer. Or a bicycle. Or a hand-sleigh. Or trudging along without any vehicle at all.
2. Your New York apartment -- easily worth a rental of $10,000.00 a year ($168,000.00 in 2016 dollars). And its luxurious furnishings.
3. Your palatial residence on Staten Island -- camouflaged as essential to the broadcasting station WBBR.
4. As though that residence were not sufficient, a further small place of seclusion in the woods of Staten Island, where you can go and rest your weary body, while the pioneers and others trudge from door to door.
5. Your further abode at San Diego, for which you yourself told me you were offered $75,000.00 (1.2 MILLION in 2016 dollars). But, of course, it could not be sold, and the funds used to help the pioneers, because it was deeded to David - what hypocrisy!
6. Commodious and expensive quarters in Magdeburg, Germany -- for the convenience of THE PRESIDENT. To say nothing of the provision made for your comfort in London.
And, what is your mental attitude toward all this? Why you glory in it, and brazenly advertise it to the friends. "Who dares find fault therewith? Am I not THE PRESIDENT?" Yes, you glory in it. Glorying in your shame.
Nothing is too good for THE PRESIDENT. He must have every comfort and every consideration. But, he feels very sympathetic, and so tenderly disposed, toward the "dear pioneers". Words are easy. But, actions speak louder than words. And, I cannot imagine a more striking [difference of living situations] ... between the clergy class and laity [class], than between yourself and the pioneers ... .
Truly, the pioneers and others, have had burdens heaped upon them that you would not move with one of your fingers. Truly, the widows have been robbed at your suggestion. Or, rather, I should say -- command. For your command to the friends is, "Take their last penny for a book. They need it more than bread." What a spirit! And yet, the friends submit to it. While a few will take the penny, ... the vast majority hate it, but feel they must obey. God is speaking.
What sacrilege! What blasphemy! What trafficking in the name of the Heavenly Father! The friends have served you faithfully. They have unknowingly been your servants -- robbed by you of everything, even the word of God, and his precious promises, which you have made null and void by your vain babblings. Trudging on day by day. Wondering, but without a murmur. ... They have advertised your name more than that of God Almighty. I [wish] that you had gone from door to door as the pioneers, and others have, and you would then know what you are talking about.
I could go on at much length about the things I know considering your personal conduct, and the contrast between yourself and the pioneers, but I choose not. My sole purpose, in outlining my personal experience with you, is with the earnest hope of awakening the friends to the fallacy of putting confidence in man above God's word, or idolizing an office, and putting confidence in that office above God's word. A Christian must learn that to honor God he must put faith in God's word, and [in] God's word alone, making it his shield and his buckler, and not [in] a man ,or body of men, or [a] corporation -- no matter what claim is made for that man, body of men, or corporation, ... . Today, Satan has overreached the Society, and has caused the friends through the WATCHTOWER to believe the time has come to establish the Kingdom and gather together the great multitude before the time, ... . ...
"In fact, Lord, we're so busy with "works" [that] we have hardly time to open our Bibles, let alone study them. You see, Lord, we have [RUTHERFORD'S BOOKS] to study now ... , and our PRESIDENT, too, is very busy -- writing [more] books. And, oh Lord, he is so courageous, and his faith in Thee so great, that he [hides] behind four walls, or surrounds himself literally with an armed bodyguard, and bellows away his dreams, ... and sends us out from door to door to face the enemy, while he goes from 'drink to drink', and tells us if we don't, we are going to be destroyed. But, don't misunderstand us Lord, we don't do it from fear, or for reward, but because of our great love for you, and therefore will not be disappointed if we get no reward, but our hope is we will spared through Armageddon. Our PRESIDENT, Lord, is really a very important man. Of course, he says he is not, even though he thinks he is, ... It is not for us to reason why, ours is but to do and die. And, 'we love to have it so'. Of course, he says when he speaks personally, it might not be correct to say he is speaking for you. But, when he speaks as PRESIDENT or through the WATCHTOWER, or [through his] books, then -- YOU speak. Is it not wonderful!" ...
Now, a word regarding the financial progress of the Society. You inform the friends and the public that the books and booklets are placed with the public at cost. They surely are -- and more!! You well know that the price to the pioneers until recently covered all costs, including all appropriate overhead charges. ... Even now, the loss is only slight on some items, while on the other hand, the price to the [congregations] and public nets the Society at least 100%! What is this 100% if it is not profit? Poor gullible friends. How they believe everything you tell them!!! Where do they think the millions of dollars invested in buildings, machinery, stock, etc, at Brooklyn, Magdeburg, London, Toronto and other places, to say nothing of your own dwellings, etc, come from, if not from profit on the books?
You know, and I know, that the gain [at] the Canadian [Branch] alone during the past few years was $100,000.00 (1.7 MILLION in 2016 dollars). And at the time I was relieved of my duties, there was not only a large sum in the bank, as customary, but also over $25,000.00 in cash was lying in the Society's vaults at 40 Irwin Avenue, and had [been] for years -- which could be used for the needs of the President, or those whom he might designate in case of an international emergency. And the dear pioneers? Well, of course, they could go hungry. Poor gullible friends!! My, were we not blind? And, how blind the friends still are! And yet, the annual reports tell of our great losses, and how it is hoped the Lord will make it up. Well, it is said, "Figures don't lie, but liars do figure." ... ... ... ...
In all my twenty years association with you, I always had a kindly feeling of love toward you in the Lord, and have in sincerity always closed my letters to you giving expression thereto. Even upon this occasion, I cannot refrain from saying that I [wish] to God that you would awaken to your position and make full confession before Him, for I have no ill will toward you whatsoever. I pity you, and would do you good, if I could. Remember, God is a God of loving kindness and tender mercy. His mercy endureth forever! ... Sincerely, W. F. Salter
"JUDGE" RUTHERFORD AND HIS COCA-COLA HEIR "FLUNKIE"
The mysterious "personal" relationships between Joe Rutherford, Bonnie Heath, and "Bill" Heath apparently benefited Joseph F. Rutherford's ego and wallet (and possibly more) every bit as much as did "Judge" Rutherford's sideline businesses -- probably more so.
William Pratt Heath Jr. was the son of COKE's main chemist and Executive Vice President of Production from 1920 forward. William P. Heath SENIOR typically was listed third on COKE's managerial chart behind the Chairman of the Board and the President. During the years preceding his retirement in 1948, Heath Senior was said to be the only person on Earth who knew the complete Coca-Cola formula.
Heath Junior's mother had become a "Bible Student" around 1915, when Junior was about 12 years-old, and his sister Susette was about 7 years-old. Both children were reared as "Bible Students". Like hundreds of similarly situated husbands/fathers scattered across the United States, Senior undoubtedly was considered a "person of good will" -- especially when he opened his checkbook. Junior went on to graduate from Georgia Tech in 1922, and thereafter followed his father to work at COKE.
In the latter 1920s, Junior moved to South Carolina to manage bottling operations at Carolina Coca-Cola Bottling Company, which was owned and operated by his uncle, Alfred Heath. There, Junior married into one of South Carolina's most prominent families. Dorothy R. Smith was the daughter of attorney, judge, businessman, and politician, Mendel Smith, whom at various times served as South Carolina Circuit Judge, State Representative, and Speaker of the House.
Junior did not choose to be baptized until 1932, just before Junior and his first wife had their first and only child in January 1933. Not long thereafter, Junior met "Judge" Rutherford for the first time in 1934.
Surprisingly, in June 1937, this then 34 year-old, "well-to-do", married businessman dropped everything going on in his life, left his wife and son, moved to WatchTower HQ, and became "Judge" Rutherford's inseparable "Personal Assistant".
In January 1938, only eight months after arriving at WatchTower HQ, William P. Heath Jr. was divorced by his estranged wife and son. Within one week, Bill Heath and Bonnie Boyd, Rutherford's longtime private secretary, flew to Los Vegas and got married. When they returned to WatchTower HQ, Bill Heath joined his new wife -- who already resided on President Rutherford's private floor. The Heaths went everywhere "Judge" Rutherford went. When Rutherford traveled on business or vacation, the Heaths went with him. When Rutherford wintered at "Beth-Sarim", the Heaths were there.
In October 1938, "Judge" Rutherford had William Pratt Heath, Jr. elected to the Board of Directors (then the "Governing Body") of the main Pennsylvania Watch Tower Society corporation.
In February 1939, "Bill" Heath purchased a 75 acre tract of property adjacent to the larger "Beth Sarim" mansion in southern California. During the following months, Heath had constructed a main house, a caretaker's house, a "bomb shelter", and several barns and other service buildings.
In May 1940, Heath deeded the improved property, known as "Beth-Shan" (House of Refuge) to the WatchTower Society FOREVER, as "Trustee" for any future "resurrected" biblical "princes" who at some point in time might wish to relocate from Jerusalem to San Diego. After Rutherford's death, legal maneuvers were required to clear and quiet title, and to remove the Watch Tower Society's name from the deed. "Beth-Shan" was sold in March 1945. The "sellers" listed on the deed were William and Bonnie Heath. We believe that it was by no mere coincidence that the purchasers were the famous aviation pioneer couple, "Bud" and Betty Gillies, whom were national celebrities intimately connected with the U. S. Military. Betty Gillies was a national heroine, whom even prior to WW2 had been featured in full-page advertisements in all popular magazines of that time for CAMEL cigarettes. Bud Gillies had held executive positions with several major aircraft manufacturers. The Gillies even constructed a large private airport across from "Beth-Shan".
"Bill" Heath, Bonnie Heath, and Joe Rutherford were inseparable until Rutherford's death in January 1942, when it is believed that Bill Heath was named as Rutherford's personal representative. After Rutherford's death, the Heaths stayed in San Diego until they both had to testify in the Olin Moyle libel trial in NYC, in 1942-43. Thereafter, the Heaths faded out of sight until 1973, when the WatchTower Society trotted out the then 70 year-old Heath to relate his "experience" as a still loyal "Jehovah's Witness" at the 1973 WatchTower Convention in Atlanta -- probably only after Heath turned over a copy of his WILL to WatchTower HQ.
Interestingly, William and Bonnie Heath lived quite an upscale social life after Rutherford died. During both Winters of 1946-47 and 1947-48, the Heaths wintered for several months at a posh southern California resort, where they socialized and partied with other social, business, and political elites. In 1948, after "Beth Sarim" also was sold, the Heaths had a new mansion constructed in Borrego Springs, California. Among the housewarming guests for this ELITE Jehovah's Witness Couple was a retired REAR ADMIRAL OF THE U. S. NAVY, (This was at a time when most patriotic Americans considered "Jehovah's Witnesses" to be anathema.) as well as Heath's parents from Atlanta. The two couples then vacationed at a nearby resort.
Lots of fodder for speculation here!!! Did "someone" cut a deal while they were in prison? Seems to be an over abundance of intimate Rutherford connections to the Government, the Military, and especially "Military Intelliegnce". Intelligence services have known -- literally for centuries -- that the easiest target in the world to compromise is a dishonest, philandering drunk. The only thing that makes for a better target is if that target is a secret homosexual/bisexual. Don't forget our research on William P. Heath's predecessor as Rutherford's BEST FRIEND, RESERVE ARMY OFFICER, Bethelite Eugene D. Orrell, and "Judge" Rutherford's favorite non-JW attorney, the GOD-HATING Joseph Wheless, who during his testimony during the 1943 Olin Moyle trial revealed that he then (WW2) worked for Military "Intelligence".
Notice that Gene Orrell and Bill Heath were CLASSMATES AT GEORGIA TECH. Notice that WW1 HERO and still RESERVE ARMY OFFICER Gene Orrell was quickly accepted for Bethelite service at WatchTower HQ in 1923. Notice that by 1931, Gene Orrell was "Bethel Servant", and was living with Bonnie Boyd and "Judge" Rutherford on his private floor. Notice that when Rutherford's and Orrell's "personal relationship" started to "peter-out" (intentional) during the mid-1930s, Bill Heath makes Rutherford's acquaintance. Four years later, Bill Heath was a WatchTower corporate Director, and was married to Bonnie Boyd, and living with Rutherford on his private floor.
To help readers further understand the public stature of William P. Heath Jr. and his family at the time that he volunteered to become "Judge" Rutherford's "Head Flunky" in 1937, it further should be noted that Junior's Jehovah's Witness sister, Susette Heath Black, was then married to the son of the CHAIRMAN OF THE FEDERAL RESERVE. Susette Black's husband was then a "Vice-President" at CHASE NATIONAL BANK, and later became head of the WORLD BANK after WW2, and even later, head of the BROOKINGS INSTITUTE. Susette Heath Black's only natural child, William Heath Black, was a Princeton and Yale alumni, who in 1953 married the daughter of onetime Brigadier-General Miles Andrew Cowles (West Point/Arlington Cemetery), who finished his post-WW2 military career in Europe, in the "Intelligence Division" (probably the then new CIA). (Google "178 Columbia Heights, Brooklyn" for Heath-Black Family ownership records.)
"JUDGED" RUTHERFORD BIBLICALLY REPRIMANDED
BY WATCHTOWER CORPORATE COUNSEL OLIN R. MOYLE
Two years after being condemned both severely and publicly by former personal friend and confidante, Walter F. Salter, "Judge" Rutherford received yet another "spanking" from yet a second high-ranking WatchTower Society official -- Corporate Counsel, Olin Richmond Moyle. However, the circumstances surrounding Olin Moyle's letter differed greatly from the circumstances surrounding Walter Salter's letter to "Judge" Rutherford.
First, Walter Salter's letter was composed and delivered after Salter had already defected from the WatchTower Society, and was intended to explain why he had defected. Olin Moyle's pending "resignation letter" was composed while Olin Moyle was still WatchTower Society Corporate Counsel. (We state "pending", because we believe that Olin Moyle genuinely hoped that Rutherford would take his reprimand to heart, and that Rutherford and he could reconcile after the Moyles returned back to Bethel from vacation.) The purpose of Olin Moyle's letter simply was to resign as WatchTower Society Corporate Counsel. Olin Moyle was NOT disassociating himself as one of "Jehovah's Witnesses". Moyle simply intended to return home to Wisconsin, and to resume doing what he had been doing in Wisconsin before he had volunteered at Bethel, including occasionally assisting "Judge" Rutherford with certain court cases.
Second, while Walter Salter intended for his condemnatory letter to become "public" at some point, the purpose of Olin Moyle's letter was to PRIVATELY reprimand and correct "Judge" Rutherford's behavior, and Olin Moyle never intended for his letter to be seen by anyone other than "Judge" Rutherford. (If Rutherford permitted any of his multiple private secretaries to open and read his private correspondence, then that was on Rutherford.) In fact, it was "Judge" Rutherford himself who ran around WatchTower HQ (probably while half-drunk) showing to multiple persons what was Olin Moyle's personal and private "resignation letter". Olin Moyle did not release copies of his letter until AFTER "Judge" Rutherford and the WatchTower Society began slandering Moyle and lying about the purpose, content, and context of Moyle's resignation letter. Thus, "thanks" to "Judged" Rutherford, here is that letter, which we have "colored" so as to show Olin Moyle's "good heart" in the letter. Moyle's criticisms are colored "red".
"JUDGED" RUTHERFORD'S LEGACY YEARS
THE ANTON ADAM KOERBER SAGA CONTINUES
(See Part One on Page 1)
As noted above, when Anton Koerber started inquiring about "his money" in 1935, "Judge" Rutherford both "ignored him", and became "antagonistic" towards Koerber. Although Anton Koerber had loyally served Rutherford as both a "Pilgrim" since 1927, and later at WatchTower HQ as a "Bethelite", during the first half of the 1930s, once Koerber refused to "just forget" about his share of his "joint venture" with "Judge" Rutherford, just like any other "mafia boss", Rutherford started looking for an opportunity to get rid of Koerber. We do not know exactly when it occurred, but sometime around 1936-37, Anton Koerber was "disfellowshipped".
Thereafter, during the remainder of the 1930s, and throughout the 1940s, Anton Adam Koerber concentrated on becoming a multi-millionaire through his many real estate ventures. Then, according to Gordon R. Pollock, whom was another former once-prominent WatchTower Bethelite and Pilgrim (see Page 1 regarding Pollock also working at radio station KFWM in Oakland), in 1951, Anton Koerber sent a $2000.00 donation (nearly $19,000.00 in 2016 dollars) to the DAWN BIBLE STUDENTS ASSOCIATION, along with Koerber's request for a private meeting with the "Trustees" (of whom Gordon Pollock was one by 1951).
Anton Koerber attended the 1951 General Convention of the DAWN BIBLE STUDENTS ASSOCIATION. There, Anton Koerber purposed to the Trustees that he would use his wealth to fund the DAWN BIBLE STUDENTS ASSOCIATION, if that decentralized group (individual local congregations were autonomous) of Russellites would change itself into a centrally controlled religious organization. (Undoubtedly, it either was expressed or implied that along with Koerber's money that Koerber also would become both a "Trustee" and "Pilgrim" for the Dawn Bible Students.) Despite Koerber's continued contacts after that meeting, the Trustees of the DAWN BIBLE STUDENTS ASSOCIATION declined Anton Koerber's repeated attempts to change what was considered to be an essential element of that Russellite organization's theology and structure in exchange for Koerber's "filthy lucre".
Interestingly, in 1952, soon after Anton Koerber's "courtship" was rebuffed by the DAWN BIBLE STUDENTS ASSOCIATION, Koerber sought and obtained "reinstatement" as one of Jehovah's Witnesses. Shortly after Koerber's reinstatement, Koerber applied for an appointment as a full-time "Pioneer". When Koerber's request was denied, the once-prominent WatchTower Bethelite and Pilgrim drove straight to Brooklyn -- to WatchTower HQ. There, Koerber "requested" an audience with the Director of the Service Department, T. J. Sullivan. Knowing Anton Koerber, and not wanting to speak or deal with him, Sullivan told Bill Cetnar to go down to the eighth-floor lobby and tell Koerber that he would not be granted an appointment as a "Pioneer" -- given Koerber's many years having been disfellowshipped, and Koerber's only recent reinstatement.
Anton Koerber refused to accept the young Bethelite's second-handed answer -- telling Cetnar that he would continue to pursue the matter up the chain of command. Koerber then gave Cetnar a parting $10.00 handshake (a week's take-home pay for many people in 1952). Cetnar went back upstairs and told Sullivan what had happened, and that Koerber wanted to speak with someone with more authority. Hugh MacMillan went back down with Bill Cetnar that second time. "Mac" gave Koerber a "thorough chewing out" for seeking a "title", and sent the MULTI-MILLIONAIRE packing.
Bill Cetnar relates that only a day or two later, when he entered the Bethel Dining Room for dinner, there sat Anton Koerber next to President Nathan Knorr at the head table. After dinner, Cetnar again saw Koerber -- in the lobby. Koerber called Cetnar over to the lobby's front window and pointed to a brand new CADILLAC parked at the curb. Koerber told Cetnar that he had just gifted that new CADILLAC to WatchTower President Nathan Knorr. Koerber added that Knorr could have another Cadillac anytime that he so desired.
Within a matter of days, the Congregation Overseer at Koerber's Maryland congregation received a letter from T. J. Sullivan notifying that congregation that Anton Koerber had been appointed a full-time "Pioneer". Within a matter of weeks, Anton Koerber -- then in his early 60s, and sickly -- was appointed as a CIRCUIT SERVANT to congregations in Maryland, and then later, in Pennsylvania. The elderly and ill Koerber served as a "Circuit Servant" until around 1960. At multiple summertime WatchTower District Conventions attended by multiple "circuits" and multiple "circuit servants", Anton Koerber repeatedly was named as "Convention Chairman". Cetnar reports that Anton Koerber even served as "Convention Chairman" of the famous 1953 International WatchTower Convention held in Yankee Stadium.
President Nathan H. Knorr even appointed Anton Koerber to be one of the secretive and limited number of "shareholders" in the WATCH TOWER BIBLE AND TRACT SOCIETY OF PENNSYLVANIA -- a "privilege" reserved for only the ELITE of the ELITE of "ANOINTED" Jehovah's Witnesses. We can nearly guarantee readers that Anton Koerber did not purchase this series of "privileges" with one or even two Cadillacs. That first Cadillac that Koerber gifted to Nathan Knorr was merely a "down payment".
Anton Koerber died in November 1967 at the age of seventy-five years old. Probably after the reading of Koerber's WILL, President Nathan Knorr directed that Koerber's biography be published in the Cult's main WATCHTOWER magazine. The May 15, 1968 issue contained the typically exaggerated biographical material. One glaring error was the portrayal of WatchTower Pilgrim General William P. Hall essentially as being Koerber's "sidekick" (our assessment), as well as not even getting the name correct of one of the WatchTower Society's most important historic figures.
As proven on Page 1 of this section, many of the Washington D. C. area "Bible Students" also were "FreeMasons". We found it particularly interesting that Koerber's WATCHTOWER biography mentions -- in the very sentence preceding the sentence that mentions Koerber's initial contact with a "Bible Student" -- that Koerber previously had "interested himself in a fraternal order".
(Fellow researchers should take a look at the parents of Rose Koerber. If such doesn't explain the following, then take a look at Koerber's "FreeMason" connections. Anton was baptized in WV in 1913, where he worked for the B&O Railroad. Was head of Dining Car operations for the Balt-Pitt run in Feb 1916 when married Rose STEINLEY from Baltimore. After marrying Rose, promoted to same position for Balt-NY run in May 1916. By February 1917, Koerber is living in DC, working in the insurance business, and is elected to the Board of Trade. On Liberty Bond Committee in April 1918. Nothing like having powerful friends or relatives.)
Interestingly, an abbreviated biographical sketch of Anton Koerber also was published in the September 15, 1993 issue of the WATCHTOWER magazine. We are still trying to determine which of Anton Koerber's heirs was then on their deathbed: Rose born in 1919, or Robert born in 1917???
Interestingly, in late 1955, four Jehovah's Witnesses, Hayden Covington, Tom Williams, Alec Joseph Sabo, and his wife, Evelyn Sabo, incorporated Sandor Petroleum Corporation as an oil and gas exploration business. At the time that Sandor Petroleum was formed, the Sabos contributed the corporation's original assets, which consisted of various oil and gas leases on about 1000 acres of land scattered about on three sections of land in Upton County, Texas. The Jehovah's Witness Combine wanted to first obtain leases on the balance of the unleased acreage before drilling was started.
In addition to performing the corporation's legal services, it was Tom Williams job to obtain the leases on the unleased portions of land. The appellate court decision does not say exactly how much of the unleased acreage that Williams was able to obtain, but Williams evidently did a good job, because the Sabos and Covington agreed to give Williams 10% of the corporation's authorized capital stock in exchange for Williams' time and cash that Williams spent obtaining those leases.
By latter 1956, Tom Williams was unhappy with the way that Sandor Petroleum was being managed (specifics not provided by court), and Williams apparently made his feelings known to the others; including his desire to sell his stock. On January 8, 1957, Hayden Covington traveled from WatchTower Society Headquarters to the Sabos home in Abilene, Texas, where Covington and the Sabos held a special Board of Directors meeting for the purpose of amending the corporation's bylaws so as to restrict the sale and transfer of Williams' stock, and give the corporation first option to purchase any of its' stock offered for sale, at a price to be fixed by appraisers. Covington and the Sabos notified Williams of the changes that same day via telegram.
Two weeks later, Williams offered to sell his stock to the Sabos, but they refused to buy it. Williams then offered his stock to Hayden Covington, but Covington also refused to buy Williams' stock. Covington and the Sabos also failed to make an offer for Williams' stock on behalf of the corporation, that is, until Tom Williams threatened to file a civil lawsuit for "CONVERSION", which is the civil law equivalent of criminal "THEFT".
Covington and the Sabos then made an offer to buy Williams' stock, but their offer was withdrawn, and Williams was advised that he would have to proceed according to the amended bylaws if he wished to sell. On February 18, 1957, Covington and the Sabos canceled Williams' two original stock certificates, and mailed Williams a new stock certificate, which had the amended bylaw printed on its reverse side. On the same date, Covington and the Sabos gave notice to the prospective buyers of Williams' stock that they would not recognize a sale, or transfer the stock on the corporation's books, unless the restrictions contained in the amended bylaw were first complied with. Tom Williams refused to accept the new stock certificate, and returned it to the corporation. The corporation thereafter returned the new stock certificate to Williams, and he again tendered it to them at the trial.
Shortly thereafter, Tom Williams filed this civil action for the "theft", or "conversion", of his Sandor Petroleum Corporation stock. Williams alleged that the "conversion" was accomplished by a corporate bylaw passed after the issuance of the stock to Williams resulting in the cancellation of his original stock certificates, issued without restriction as to their sale or transfer, and substituting in lieu thereof, a stock certificate with restrictions concerning sale and transfer. The case was tried before a jury which found that the act of canceling Williams' two stock certificates, and amending the bylaws of the corporation by making certain restrictions relative to the sale of the stock, constituted a "conversion" of said stock. A judgment was entered for Tom Williams for the sum of $27,500.00.
UNBELIEVABLY, on appeal to the Supreme Court of Texas, the Defendants/Appellants contended that Williams' two original stock certificates were not issued for money paid to, labor done for, or property actually delivered to the corporation, as required by Texas law, and that Williams' stock certificates thus were "void". The Defendants/Appellants also contended a bunch more malarkey -- none of which was "bought" by the Texas Supreme Court, which affirmed the trial court's rulings and judgment, stating in part:
The evidence shows that certificates numbers four and eight were issued to Williams for a good and valuable consideration. ... There was evidence to the effect that the corporation received and accepted legal services rendered by Williams of the value of $3,950 and that he expended $1,250 in money in behalf of the corporation. The jury found upon sufficient evidence that appellants accepted such services and money from Williams in consideration for stock certificates numbers four and eight and recognized the validity of the certificates. ... ... ...... There was no provision in the articles of incorporation, in the original bylaws or in the shares for a restriction on the sale or transfer of the stock except a provision that a transfer must be made on the stock transfer books of the corporation. Williams thus acquired 2,500 shares of Sandor Petroleum Corporation stock free of any charter limitation on its sale or transfer. His ownership of the stock and his right to sell or transfer it was a vested right and interest, subject only to the right of the corporation to manage and regulate its affairs under the laws of this state and under the provisions of its charter and bylaws. ... ... ...... Conversion is defined as "an unauthorized assumption and exercise of the right of ownership over goods or personal chattels belonging to another to the alteration of their condition or the exclusion of an owner's rights." ... The essence of conversion of property is the wrongful deprivation of it to the owner. Conversion may be direct or constructive. ... The evidence shows that in accordance with the bylaw restricting the sale of non-restricted stock certificates previously issued to Williams, the corporation canceled his certificates numbers four and eight and substituted in lieu thereof certificate number nine containing the restrictions on sale and transfer. This was an unauthorized alteration of the condition of Williams' stock. Actually the cancellation of his original shares was in effect a taking of his stock and was an unauthorized and unlawful act amounting to conversion. ... The new stock certificate was enclosed in a letter to Williams from the corporation advising him of the action taken. The letter stated in part: "Please return original certificates number four and eight which are canceled." The evidence further shows by letters from the corporation to Williams that unless the procedure prescribed in the amended bylaw restricting the sale and transfer of stock was complied with no transfer would be recognized or entered upon the books of the corporation. Williams had been negotiating with prospective purchasers of his stock. Appellants by letter advised such prospective purchasers that the corporation would not recognize a sale of Williams' stock and would not enter a transfer on its books unless the requirements of the amended bylaw were first complied with. They were wrongfully asserting and exercising an authority over a right in the stock which was adverse to and destructive of the vested property right and interest of Williams therein. ...
*** Interestingly, Sandor Petroleum Corp is still doing business in 2013, and is still partially owned by 98 year-old Evelyn Parker Sabo. However, the current Sandor President now is a wealthy Jehovah's Witness Investor in multiple businesses domiciled in Louisiana and California, named Walter H. Bass. Prominent Jehovah's Witness and former WatchTower Society attorney, Judah Ben Schroeder, may possibly be Sandor's corporate attorney.
PIONEERS IN THE TRAVEL-TRAILER and MOBILE HOME INDUSTRIES
Given the fact that this Editor was reared as a Jehovah's Witness during the days when many WatchTower Society "Circuit Servants" (District Sales Managers) pulled travel trailers from congregation to congregation, I could not help but be intrigued when I ran across the fact that during the 1950s that "Jehovah's Witnesses" in Texas were "Pioneers" in the travel-trailer and mobile home industries. Having previously discovered and publicized the SANDOR PETROLEUM case, when we further discovered that a WatchTower "Circuit Servant" had been introduced into the management of a second Texas company, we could not help but be "suspicious" that the WatchTower Society and/or its' top brass possibly had wiggled their way into becoming "silent-partners" with the Jehovah's Witnesses who had founded and were operating that Texas manufacturing business. Our suspicion only increased when we further learned that soon after the introduction of the "Circuit Servant" into the management of that Texas manufacturing business, nationwide expansion occurred, which was quickly followed by the sale of that business to capitalize on its recent large increase in worth and future market potential -- all in only 3 years. Here is what we have discovered. Take such for what its' worth.
UNITED STATES v. CLETUS COY HENSLEE was the 1942-43 Texas federal prosecution of a 23 year-old Jehovah's Witness who had refused to be inducted into the U.S. military, when he was drafted soon after Pearl Harbor. Cletus C. Henslee was convicted and sentenced to two years in prison. Undoubtedly, Cletus Henslee and fellow DFW Jehovah's Witness Attorney Hayden Covington became well acquainted during this court case.
In 1948, in Grand Prairie, Texas, Cletus Coy Henslee began to build "trailers" of unknown kind and quantity. That new business grew quickly into the Henslee Mobile Home Manufacturing Company, which eventually was relocated to Arlington, Texas. There, in October 1954, the new corporation, Hensley Mobile Homes, Inc., was formed. Cletus Henslee also founded a Finance Company called Mobile Homes Investment Finance Company, as well as a separate wholesale distribution company, and a separate local retail sales lot. Money was rolling in. That fact apparently caught the eye of the Henslee family's fellow Jehovah's Witnesses.
In 1949, George Card and his wife, of Portland, Oregon, graduated from the WATCHTOWER BIBLE SCHOOL OF GILEAD. From 1949 until 1955, George Card and his wife were assigned by the WatchTower Cult as a "Circuit Servant" (District Sales Manager) couple to various regions of the state of Texas. In October 1955, 45 year-old George Card suddenly ceased his duties as a Circuit Servant and became "Vice President" and "General Manager" of Henslee Mobile Homes, Inc. Three months later, in January 1956, a new Texas corporation was formed as a holding company for the Henslee factory properties.
Soon thereafter, a second Henslee manufacturing plant, Casa Manana Trailer Corporation, was pursued in Waycross, Georgia. In December 1956, Henslee finalized a deal with the City of Waycross, Georgia and Ware County, Georgia, to lease a 37,000 square foot building at the Waycross Airport, for a new mobile home manufacturing plant, where operations were begun as soon as the building was remodeled. Other than that, little more is known about Henslee's Georgia operations. We will assume that Cletus Henslee did to the citizens and taxpayers of Waycross, Georgia, what Henslee thereafter did to the citizens and taxpayers of Bend, Oregon, and that the well-publicized Oregon maneuvers had been patterned after Henslee's maneuvers in establishing the barely-publicized Georgia operation.
Even before the Georgia deal was finalized in December 1956, in mid-1956, a third Henslee manufacturing facility was pursued in the state of Oregon -- George Card's home state. Henslee and Card negotiated with the Chambers of Commerce at both Salem, Oregon and Bend, Oregon, and played one against the other. By December 1957, the Chamber of Commerce of Bend, Oregon had agreed to lease to Henslee a 7 acre tract of industrial property, to which the City of Bend would construct a new road and railroad spur. The cost of the new spur and road has not been found, but the new water main/lines, supply, etc., required for the sprinkler system at the new Henslee factory cost the City of Bend a new $200,000.00 bond issue. Henslee's new Oregon corporation, Henslee Mobile Homes Manufacturing Inc., received a local bank loan of $125,000.00 for the construction of the building, and was also given local loans for equipping the new factory, which totaled $50,000.00 -- a $30,000.00 bank loan co-signed by seven local investors, and a $20,000.00 direct loan from the same group of investors. Basically, the citizens and taxpayers of Bend, Oregon were conned into putting up most if not all of the $$$$, and conned into taking all of the financial risk of this new business venture. Cletus Henslee began attempts to "cash-out" his limited investment in this Oregon operation around the same time that manufacturing operations started.
Ground was broken on the new 50,000 square foot factory on December 31, 1957. Construction took less than six months. Production of "trailers" began in June 1958 -- with Gilead-graduate and former WatchTower Circuit Servant George Card serving as the Oregon manufacturing plant's "Resident Manager" -- as well as serving as the new "Congregation Servant" of the Eugene Oregon Kingdom Hall of Jehovah's Witnesses.
In early January 1959, the seven local Bend investors received a telegram from Cletus Henslee informing them that he was going to "retire" (age 39) to his cattle ranch on the advice of his doctor due to his poor health, and that he was selling all three of his manufacturing operations for $1.5 Million to "Midwest Steel", of Dallas, Texas -- subject to the "first option" rights held by those seven Bend stockholders. Henslee offered to sell the majority shares in the Oregon corporation held by Henslee and an "Ivan Toller" (identified as the Manager of Henslee's Georgia factory) to the seven Bend investors for $70,000.00 (the corporation's debts and legal obligations stayed with the corporate entity -- thus we are unsure exactly what Henslee and Toller actually had invested in that "$70,000.00").
When those seven Bend investors did not exercise their right to purchase Henslees and Tollers stock, Cletus Henslee announced that his Georgia and Oregon manufacturing operations had been sold to Eugene Fant, a Texas investor who owned one of Henslee's steel suppliers -- New Process Steel and Supply Corp, of Dallas, Texas. An option on Henslee's Arlington, Texas operations was included.
Curiously, in June 1959, although the sale of the Oregon factory to Gene Fant was completed, Cletus Henslee, his family, Ivan Toller, and Gene Fant, all traveled to Bend to look over the Oregon operations. Bend reporters were told that Fant had also purchased Henslee's Arlington, Texas operations, as well as a fourth mobile home manufacturing operation in Arkansas.
In November 1960, the Bend, Oregon factory was closed down by unpaid creditors -- with that separate Oregon Corporation owing around $553,000.00 to local Oregon lenders, investors, and suppliers. We have not yet discovered what happened to the Texas and Georgia operations under Fant's ownership. Neither do we known what happened to George Card after the bankruptcy of the Oregon corporation. George Card and his wife seem to disappear off the face of the planet. Interestingly, the aforementioned fourth mobile home manufacturing plant purchased by Fant at the same time that Fant supposedly had purchased Henslee's operations, which Eugene Fant had briefly mentioned to the Bend media, was also "busted out" and forced into bankruptcy almost at the same time as was the Oregon operation. Interestingly, no mention of any of these purchases, or the ownership or operation of any of these separate corporations, are included in the now deceased Eugene Fant's business biography.
Is anyone else reminded of the GOOD FELLAS restaurant bust-out segment? Anyone else wonder how many similar, but smaller and unpublicized, JW-owned business profit-taking scenarios may have occurred over the decades? There is an unconfirmed rumor that for decades thereafter at WatchTower Cult HQ in Brooklyn, New York, that "Bend, Oregon", was known more aptly as "Bend-Over, Oregon".
We also ran across several other HALF-TRUTHS and LIES told during the BEND, OREGON SCAM. First, in the 1958 local newspaper article in which George Card introduced himself to the community as the new "Congregation Servant" of the Eugene Oregon Kingdom Hall of Jehovah's Witnesses, George Card failed to mention that he was "Vice President" of the Henslee Mobile Homes, Inc., and that he had relocated to Bend to work as the "Resident Manager" at the new factory. George Card simply related his graduation from the WATCHTOWER BIBLE SCHOOL OF GILEAD, and that thereafter, he had served as a WatchTower Society "Circuit Servant" in Texas. George Card told the reporter that he had ceased serving as a "Circuit Servant" in Texas, and had relocated to serve as Bend's "Presiding Minister" due to his "ill health" -- without Card mentioning that he had been working as the General Manager of the Henslee factory in Arlington, Texas, since October 1955.
During Cletus Henslee's negotiations with the Bend Oregon Chamber of Commerce, Henslee apparently also misled them into believing that he was going to relocate his main offices from Texas to Oregon. In fact, in 1957, the Bend CoC publicly announced to local businessmen that if their negotiations with Cletus Henslee were successful that Henslee and his family were going to relocate to Bend. Cutely, Cletus Henslee placed one of his mobile homes on a trailer lot owned by a local JW, and the Henslee family did in fact stay there several weeks while the new Oregon factory was being constructed. However, they thereafter returned to their mansion in Texas. Additionally, while it may have been true that Henslee had "ulcers", it soon became apparent that Henslee never had any intentions to "retire".
In fact, starting in the early Spring of 1959, Henslee Mobile Homes, Inc., began purchasing additional tracts of land for the construction of additional manufacturing facilities at Arlington, Texas, including a tract that contained a residential home, which was converted into a new Henslee Manufacturing office building. There is no further evidence -- other than their claims -- that Henslee actually sold his ownership of the Texas corporation to Eugene Fant. In fact, Henslee trailers and mobile homes continue to be manufactured in Arlington, Texas throughout the 1960s under the management of Cletus Henslee. Additionally, at some point after the departure of George Card, Card was replaced as the "Vice-President" and "General Manager" of Henslee Mobile Homes, Inc. by Cecil A. Rainwater, who was the Congregation Servant at the Grand Prairie Texas Congregation of Jehovah's Witnesses. (SEE NEXT SUMMARY.)
Finally, in January 1969, Henslee Mobile Homes, Inc. was sold to a Dallas corporation named Republic Gypsum Company. Henslee Mobile Homes, Inc. possibly was valued as much as $8.5 MILLION at the time. Stock ownership is unknown, but Cletus Henslee was still "President" when the sale occurred. Thereafter, business was conducted under a new corporation called Republic-Henslee, Inc.
NATIONAL TRAILER CONVOY INC.
As noted in the HENSLEY case above, Cecil A. Rainwater was sent to Texas, around 1965-66, by the WatchTower Society to manage the daily operations of Hensley Mobile Homes Inc., replacing former Circuit Servant, George Card, who had been sent to Bend, Oregon to there manage their new factory. We know that Cecil Rainwater actually moved from Tulsa, Oklahoma to Texas, around 1965-66, to work at HENSLEY, because he also became the Congregation Servant at the Grand Prairie Texas Congregation of Jehovah's Witnesses.
In the latter 1940s through the mid 1950s, in Tulsa, Cecil Rainwater and Chester Brazeal, both being the respective Congregation Servants at Tulsa's then two Kingdom Halls, were minority shareholders in OKLAHOMA TRAILER CONVOY, INC., which was 50% owned by Irving Payne. They and others eventually purchased other national competitors and became National Trailer Convoy Inc., and Nations Trailer Convoy Inc. We have not been able to confirm nor deny that Payne or the other shareholders were Jehovah's Witnesses. (Shareholder Edmondson possibly was a JW given an extended family of Edmonsons who were JWs who had multiple ties to Tulsa -- notably Larry EDMOND Seward, an ATTORNEY.)
Notably, in the BURRY court case, Cecil Rainwater testified that he had been the General Manager at National, in Tulsa, starting in 1956, and he appears to have continued at CONVOY until around 1965, when the new owners took over. Interestingly, although Rainwater and other JWs were minority shareholders in CONVOY prior to 1956, something happened around 1956. As soon as Cecil Rainwater took over the management, be began to expand Convoy's local operations throughout the United States, eventually reaching 160 terminals in 45 states.
THEN, there is the question of how much of any named JW's ownership actually was his, and how much was he possibly holding for the WatchTower Society and/or one or more of its top officials. See below how Hayden Covington popped up in 1962 when NATIONAL was sold. $100,000.00 was a fortune in 1962. This editor still recalls back around 1970 the celebration that occurred in our county when a real estate company sold the county's first property which exceeded $100,000.00. Around 1962, this editor's father and mother both worked 50-60 hours per week, hard manual labor, and their combined take-home pay was only $75.00 per week.
No. MC-F-8288: LEASE PLAN INTERNATIONAL CORP. -- CONTROL -- NATIONAL TRAILER CONVOY, INC.
Interstate Commerce Commission Application of Lease Plan International Corp., for authority to acquire control of National Trailer Convoy, Inc., through purchase of capital stock, and, in turn, by Herman L. Meckler through the transaction, denied.
By application filed November 21, 1962, as amended, Lease Plan International Corp., of Great Neck, N. Y., hereinafter called LPI, seeks authority under section 5 of the Interstate Commerce Act, to acquire control of National Trailer Convoy, Inc., an Oklahoma corporation, hereinafter called National, and the latter's wholly owned subsidiary, Mobilehome Industries, Inc., hereinafter called Industries, together with a commonly controlled affiliate, National Trailer Convoy, Inc., an Indiana corporation, hereinafter called National (Ind.), all of Tulsa, Okla., through purchase from L. Irving Payne, also of Tulsa, of all the stock of National and National (Ind.) for $1,150,000, subject to adjustments, and through purchase, for $100,000 from Hayden C. Covington, of Brooklyn, N. Y., of an assignment of a preexisting option to purchase said stock. ... ...
National is a motor common carrier, principally of trailers designed to be drawn by passenger automobiles, over irregular routes, in truckaway service, in initial movements, from designated points or areas in 31 States to all points in the United States, with certain exceptions as to service from some origin points. Among others, it may serve all points of origin which Anchor (Del.) and Anchor (Mich.) are authorized to serve on initial movements.
National's authority for secondary movements is limited to (1) commercial, house, cabin, bungalow, special equipment, and special purpose trailers, in truckaway service, between points in the United States, and (2) trailers designed to be drawn by passenger automobiles, in truckaway service, (a) between points in Maryland, Pennsylvania, Virginia, and the District of Columbia, and (b) between points in that territory, on the one hand, and, on the other, points in the United States.
In some instances, its rights are restricted against tacking of initial with secondary authority. It may also transport campers, camp coaches, and camper bodies, restricted, in many instances, to those to be installed on pickup trucks, from points in Washington and California and from Tooele and West Jordan, Utah, to points in the United States.
Under its rights to transport various types of boats to points in the United States, it has origin points in Oklahoma, Texas, Niles, Mich., and several points in Indiana. It also holds authority to transport cement mixers and farm gates from Clearfield, Pa., to points in six nearby States and the District of Columbia.
National (Ind.) is engaged in the intrastate transportation of mobile homes in Indiana. Industries was formed to serve as a retail sales outlet to dispose of damaged units. It is presently inactive, but is kept alive to preserve its several assets. LPI accepted a proposal from the withdrawing protestants that National’s rights to transport commercial trailers from Chicago, Ill., Elkhart, Ind., and points in Michigan in initial movements, and between any points in secondary movements, be limited to such trailers as are designed to be drawn by passenger automobiles. ... ...
Operations of National. The applicants furnished an abstract of representative shipments by National. House trailer or mobile home movements are seasonal. Consequently, applicants showed all such movements from its terminals for 1 day each month from May through October, 1962. Movements of other commodities (special purpose trailers, boats, and undercarriages) are shown only for June and July, 1962, being less seasonal in nature. There are 84 initial and 832 secondary movements of house trailers, representing a substantial cross section of the authorized origins and destinations. There are 165 initial and 139 secondary movements of special purpose trailers, including travel, office, and Ritchen trailers, portable schoolrooms, and small freight trailers meant to be drawn by passenger cars, also representing a cross section of authorized points. There are no identifiable movements of camp trailers or camper bodies, although there are many shipments of "travel trailers" from California origins. There are 27 shipments of boats, embracing origins at Macon, Ga., Syracuse, Ind., and Austin and Sherman, Tex., and numerous destinations. ... ...
No changes are contemplated in the nature of the operations of National under control of LPI, and employees of National would not be adversely affected. ... ...
By agreement dated November 16, 1962, as amended by a supplemental agreement dated January 18, 1963, LPI agreed to acquire (1) from Covington his prior option to purchase the outstanding stock of National and National (Ind.), for $100,000, and (2) from Payne, directly and not through exercise of the option, all of the stock of National and National (Ind.) for $1,150,000, subject to increase by the amount of any increase in the net worth of National, Industries, and National (Ind.) between January 1, 1962, and the last day of the month in which this Commission and any other necessary public authorities finally approve the proposed transaction, less any undisclosed claims, liabilities, liens, encumbrances or debts or losses due to breach of warranties, guarantees, or agreements.
Of the consideration payable to Payne, $500 is for his agreement not to compete with National, Industries, or National (Ind.) for 3 years after closing. Payne undertakes to guarantee collectibility of the accounts receivable of the acquired companies remaining unpaid after 1 year from the closing date, less $20,000 deductible; and $50,000 would be held in escrow by a bank for 1 year after closing, to insure payment by Payne of any deductions from the purchase price or overdue accounts. The agreement would terminate upon final denial by this Commission, which would also terminate the option.
The right to exercise the option was assigned to LPI by Covington on November 8, 1962, for $10, plus $100,000 to be paid upon approval and consummation herein. The role of Covington in this matter is not clear. He is identified only by name and address, with no information as to his possible affiliation with any carrier. On December 4, 1961, Payne first granted the option to Covington for $10 "and other good and valuable consideration," the nature of which is not revealed, paid there with, to purchase the stock (or net assets) of National and National (Ind.) for $1,150,000 within 3 months from that date, subject to assignment by Covington to another.
A prior option granted by Payne to Q. R. Brashier and C. A. Rainwater (a known JW Elder, see above), dated May 5, 1961, was stated to have been canceled. The only one of the latter who can be identified is Rainwater, who was a director and executive vice president of all three companies in the National system as of December 31, 1961.
On February 22, 1962, the foregoing option was extended for 6 months or until the Securities and Exchange Commission (SEC) approved the public sale of the stock of "Consolidated Leasing", an otherwise unidentified corporation, in exchange for $3,000 to be paid by Covington on or before signing of a firm contract for sale of the stock.
On October 30, 1962, for $1, Payne agreed to a further extension of the option pending consummation of the transaction proposed herein, reciting the fact that there had been an interim agreement to extend in an agreement dated March 30, 1962, between Payne, Covington, and Consolidated Leasing Corporation of America. The latter extension was incorporated in the agreement of November 16, 1962, described above. ... ...
It is noted, however that their combined earnings for the first 9 months of 1962, were $240,643. The purchase price is not excessive. Consummation would not involved incurring any fixed charges. Had the transaction been consummated at September 30, 1962, the purchase price would have been increased by the amount of the earnings of $240,643 to $1,490,643. ... ...
The option. In connection with the proposed payment of $100,000 to Covington for assignment of his option, we are unable, from this record, to determine whether the consideration to him is excessive or justified. No evidence has been presented as to any services performed by him, nor do we know how much Covington has invested in the option. ...
It does appear, however, that Covington seems never to have had any intention of exercising the option himself, but tried to sell the option to Consolidated Leasing Corporation of America and then to LPI. Although he did not obtain title to the stock of National and affiliates, he did acquire an equity interest therein through the option.
Obviously trafficking in operating rights can be accomplished through such options as readily as through legal ownership of the rights. While no findings can be made on this record concerning the question of whether there exists an attempt to traffic in operating rights, it is pertinent to observe that operating rights and the controlling stock of carriers do not represent ordinary articles of commerce to be bought and sold for speculation or a quick profit.
In any event, we are here unable to find that the payment to Covington, which is an aspect of the transaction which we must consider under section 5, would be just and reasonable, and otherwise consistent with the public interest. ... We find that the transaction has not been shown to be consistent with the public interest, and that, accordingly, the application should be denied. ...
Decided August 29, 1963
On reconsideration, acquisition by Lease Plan International Corp. of control of National Trailer Convoy, Inc. (Okla.), Mobilehome Industries, Inc., and National Trailer Convoy, Inc. (Ind.), through purchase of capital stock, and, in turn, by Herman L. Meckler through such acquisition, approved and authorized, subject to conditions. ... ...
Under the agreement, LPI would purchase the outstanding capital stock of National, and that of its subsidiary and affiliate, for a base consideration of $1,150,000, subject to certain adjustments, and would acquire from Hayden C. Covington, of Brooklyn, N. Y., his option to purchase the said stock for $100,000. ... ...
The petition points out that Covington's function in connection with the transaction was primarily that of attorney for the selling stockholder, but for tax reasons, he preferred to waive his fee in favor of a possible capital gain through sale of an option to purchase the stock of National and its affiliates; that his mission in finding a purchaser for the stock required considerable travel and conferences with prospective purchasers and others; that his efforts involved attempts to form a group in which he would participate in exercising the option; and that his endeavors lasted for several years.
The petition, and a statement by Covington attached thereto, also stated that in connection with these efforts, Covington obtained the assistance of Blair & Co., Incorporated, investment bankers, in finding a buyer for the stock, and agreed to share the proceeds of the sale of the option with that firm, on an equal basis. While the payment of a reasonable "finders" fee is not objectionable, unless the "finder" engages in the business of trafficking in operating rights, the amount and basis for such fee are terms of the transaction which we must consider and approve. ...
LPI argues that the Commission in other similar proceedings has approved a finders fee of not in excess of 5 percent of the total purchase price. While this is true, the amount proposed to be paid in this instance represents almost 10 percent of the base purchase price. Our findings, accordingly, will be conditioned to approve payment to Covington, of not exceeding 5 percent of the purchase price, as adjusted under the terms of the contract.
Readers interested in more recent "questionable" WATCHTOWER SOCIETY business dealings should read the 2006 HENWOOD v. GEORGIA-PACIFIC ET AL court case summary, which reveals some extremely interesting "goings-on" in connection with possible OVER-PAYMENTS for purchases of bulk paper by the WatchTower Society from the late 1970s until 2000. This same webpage also contains several secret court cases in which Judge Rutherford committed THEFT and/or FRAUD.
THE INTERNET'S BEST JOSEPH FRANKLIN RUTHERFORD BIOGRAPHY OF HIS MISSOURI YEARS:
AN EXAMINATION OF JUDGE JOSEPH F. RUTHERFORD'S
EDUCATION AND PERFORMANCE AS ATTORNEY, PROSECUTOR, AND JUDGE
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EMPLOYMENT ISSUES UNIQUE TO JEHOVAH'S WITNESS EMPLOYEES