"A good deal more might be said in condemnation of the unparalleled wrong corn-. plained of, but we forbear. The receiver will be removed. The matter will be referred to a master to ascertain and report the amount that has been as aforesaid unlawfully exacted by the receiver from Rice, which sum, when ascertained, will be repaid to him. The master will also inquire and report whether any part of the money collected by the receiver from Rice has been paid to the Standard Oil Company, and if so how much, to the end that, if any such payments have been made, suit may be in stituted for its recovery." * On December i8 George K. Nash, a former governor of Ohio, was appointed master commissioner to take testimony and clear up the point doubtful in the judge's mind—to whom had the extra money paid by Rice been paid; the receiver declared that he never paid the Standard Oil Company any part of Rice's money. Mr. Nash summoned a large number of witnesses and gradually untangled the story told above. Mr. Pease spoke truly, he had never paid the Standard Oil Com pany any part of Mr. Rice's money. A joint agent of the rail road and the pipe-line had been appointed, at a salary of eighty-five dollars a month, sixty dollars paid by Pease and twenty-five dollars by the Standard, who collected the freight on independent shipments and divided the money between the two parties. It was from this agent that it was learned that, twelve days after Judge Baxter ordered Receiver Pease to bring his contracts into court, the money paid on Mr. Rice's oil had been returned by the Standard Oil Company.* While the investigation in regard to Mr. Rice's oil was going on, complaints came to Commissioner Nash from two other oil works at Marietta that they had been suffering a like discrimination for a much longer time. The commissioner investigated the cases and found the com plaints justified. The Standard Oil Company had received $649.15 out of the money paid by one concern to the railroad for carrying its oil, and $639.75 out of the sum paid by another concern! Both of these sums were returned by the Standard.
Of course the case aroused violent comment. In i888 it came before the Congressional Committee which was inves tigating trusts, and an effort was made to explain the twenty five cents extra as a charge of the pipe-line for carrying oil to the railway. Nov, the practice in vogue in the Oil Regions then and now is that the purchaser of the oil pays the pipe line charge. The railroad has nothing to do with it. Even if the Standard Oil Company puts a tax on railroads for allow ing them to take oil carried by its pipe-lines—thus collecting double pay—the tax would not apply in Mr. Rice's case, for the oil came to the Cincinnati and Marietta road not through Standard pipes but through Mr. Rice's own pipes. This much Mr. O'Day was obliged to admit in 1888: Q. But did that other oil which was in competition with you pass through your pipe ? A. No, sir.
Q. Did not they, therefore, on that oil which only passed over their railroad and not through your pipe-line, pay to you the same allowance or rebate that they did on your oil which did pass ? A. They did, but we returned it through the advice of our counsel, Mr. Dodd.
Q. Now, out of that sum how much did you get from the railroad out of what they had received from Mr. Rice ?
A. We did not get any; that is, we did not retain any. The railroad company agreed to account to us for the oil that went over its lines, and they did make an accounting, to my recollection, of about $2oo, or something like that, on oil other than that which passed through the lines. Our counsel, Mr. Dodd, advised me that we could not do that business, and we refunded the money.
Soon after the report of the Congressional Committee was published John D. Rockefeller himself explained the case in an interview published in the New York World for March 29, 189o: "When the arrangement was reported to the officers of the company at New York," Mr. Rockefeller told the interviewer, "it was not agreed to because our coun sel pronounced it illegal in so far as it embraced oil carried by the pipe-line. Some $250 had been paid to the pipe-line under this contract on oil which the line had not transported. This was refunded. We repudiated the contract before it was passed upon by the courts and made full recompense. In a business as large as ours, conducted by so many agents, some things are likely to be done which we cannot approve. We correct them as soon as they come to our knowledge. The public hears of the wrong—it never hears of the correction." In the Digest of Evidence made by the Industrial Commis sion in its report published in 19oo (page 158), it is stated that the money collected was refunded before suit was brought. The facts show that the statement in the report of the Indus trial Commission that the money was refunded before suit was brought is wrong, and that, while Mr. Rockefeller is technically correct in stating that the Standard repudiated the contract before it was passed on by the courts, he should have added they did not repudiate the contract until eight months after it was made, and did not refund the money until twelve days after it became certain that the contract would be produced in court. He also does not explain why the Standard Oil Company did not return the money unjustly paid to them on the shipments of the other independent oil concerns of Marietta until exposure by Commissioner Nash's investigation made it inevitable.* But it was not only manipulation of the railroads by the Standard Oil Company of which the public was complain ing at this time. The policy of making it impossible for even small independent concerns to do business was attracting more and more attention. Indeed, there was going on in Buffalo, New York, simultaneously with these two cases, a most sensational trial, growing out of an indictment for the crime of conspiracy, by the Grand Jury of Erie County, New York, of three prominent members of the Standard Oil Company—H. H. Rogers, John D. Archbold and Ambrose McGregor—with two refiners with whom they were associ ated—H. B. Everest and C. M. Everest. The case is reported in the next chapter at some length, because of the importance it has assumed in the popular controversy which has been going on for the last twenty years over "Standard methods," it being the case on which is based the often-repeated charge that Mr. Rockefeller, to win his point, has been known to burn refineries.