ANALYSIS OF TOBACCO GROWERS ' ASSOCIATION 75 



Mr. Watkins, Mr. Patterson, Mr. Edmondson or the Edmondson Tobacco Co., on 

 the ground that all such resolutions were passed without full disclosure to 

 this board of directors of all pertinent facts. 



At the same meeting it also approved of prosecuting vigorously 

 these parties for all claims against them. 



It is doubtful if either the executive committee or the board of 

 directors was placed in possession of all of the facts of the case 

 prior to January, 1926. The executive committee probably took the 

 facts as presented to them at their face value and authorized the 

 redrying policy in good faith. Apparently the members of the 

 association never approved of the action of the executive committee 

 in June, 1923, or of the action of the board of directors in August, 

 1925. Xo prior approval by the board of directors was found for 

 Messrs. Watkins and Patterson to privately dry association tobacco 

 in 1922. _ 



The minutes of the board of directors for January 19, 1926, state 

 in part : 



It has been made evident that the members of the board of directors with 

 a few exceptions, were not aware, prior to June, 1923, that Manager Patterson 

 and Watkins had an interest in the. Edmondson redrying activities for the 

 1922 crop ; and that most of the directors did have general knowledge of such 

 activities for the 1923 and the 1924 crops. 



Evidently, knowledge of the fact that certain officials of the 

 association were engaged in redrying tobacco for the association 

 became known to some of the members before the spring of 1925. 

 In their report at this time the agricultural investigating committee 

 stated : ;i The officers of this association who engaged in this redrying 

 business have come in for considerable criticism." The committee 

 felt that the knowledge of the members of the association that its 

 officials were financially interested in redrying plants was a cause of 

 declining support by members. 



In regard to redrying of tobacco for the association by officials in 

 1922, the report of the Federal Trade Commission is of interest 

 (12, p. 85) : 



The facts are that Messrs. Patterson, general manager, and Watkins, director 

 of warehouses, made their private arrangements to redry association tobacco 

 through the Edmondson Tobacco Co.. prior to the delivery of the 1922 crop, and 

 did redry cooperative tobacco of the 1922 crop in exactly the same way they 

 were represented to have begun in 1923. Furthermore, at least 15 other offi- 

 cials were privately interested in 11 other redrying concerns which redried 

 association tobacco of the 1922 crop. Xo new firms with which important 

 officers were connected began redrying this cooperative's tobacco in 1923. Of 

 the total volume redried by the association in 1922 and 1923. a larger propor- 

 tion, or 48 per cent, was redried in 1922 in plants in which officials were inter- 

 ested than was redried in such plants in 1923 when the proportion was 44 

 per cent. 



According to a report of the association in 1925 *on the " Redrying 

 policy of the association." some of its representatives at least were 

 aware of the fact that at least one of its officers was, as early as 

 1922, redrying association tobacco. 37 This official, the sales manager 



37 In the spring of 1922, F. D. Williams was employed as sales manager of the dark- 

 fired department, to have charge of the handling and selling of dark-fired tobacco. It 

 was agreed between Mr. Williams and the representatives of the association employing 

 him that he could continue to operate his redrying plants, and that he could redry asso- 

 ciation tobacco, provided a fair price could be agreed upon. These representatives of the 

 association desired him to redry association tobacco. 



