Fleishhacker Freres

Q. ''Did you ever find out whether Fleishhacker murdered all that boatload of Chinamen?"

A. "I was told he was interested in the business of bringing in Chinese which I was told was very profitable and that a man called Joey Harper . . . had been passing through Los Angeles and while he was there in one of the cheaper houses he had for a neighbor an oil man whom I had to contact . . . and he told the oil man . . . that he ... was smuggling in Chinese, that they had been caught up with ... by a U. S. cutter and had to sink the boat with the Chinese and that he afterward went to Mr. Fleishhacker and got a lot of money.''

This extraordinary hearsay testimony was but one tidbit enlivening a civil suit which opened in San Francisco fortnight ago and which, because for their own reasons local newspapers did not care to mention it, was just coming to Californian ears last week. What interested Californians most was the identity of the suit's chief defendant.

A big, heavy-jowled Jew of 64, Herbert Fleishhacker made a small fortune in wood, paper and power mills, got into banking in 1907 by marrying the daughter of Sigmund Greenbaum, president of San Francisco's London, Paris & American Bank. Simon and Alexandre Lazard, Alsatian commission merchants who started Lazard Freres in San Francisco during the gold rush, in 1884 formed the London, Paris & American Bank to handle their interests when the firm moved to New York and Paris. Young Fleishhacker rose speedily to the top, but not solely because he married the boss's daughter. Banker Fleishhacker has a cold, keen brain perfectly adapted to his job. In 1932, after various other mergers, the bank grew into the present Anglo California National Bank, fourth largest in California (total assets: $239,500,000), with Herbert Fleishhacker president, his quieter, older brother, Mortimer, chairman. Generally reputed to be heavy but highly successful investors, the Brothers Fleishhacker have interests in shipping, agriculture, oil, paper, mining, hotels, retail stores, cement.

With a sense of humor befitting his heavy frame, Herbert Fleishhacker is today one of those unusual personalities who cause some travelers to describe San Francisco as the most cosmopolitan city in the U. S. His close cronies find amusement at his joy in a wager at golf, bridge, backgammon, dominoes, his even deeper desire to win at all of them. They have long since become accustomed to his practical jokes, are not surprised when he hands out explosive cigars, shaves during business conferences, becomes irrepressibly boisterous. And shrewd Mr. Fleishhacker now finds his name firmly imbedded in local projects. A supporter and campaign contributor of the late James ("Sunny Jim") Rolph Jr. who became Governor of California, he was made head of San Francisco's Park Commission, had named after him Fleishhacker Zoo, Fleishhacker Park, Fleishhacker Swimming Pool.

Unaccustomed to the American quirks of Herbert Fleishhacker was a little, button-eyed Frenchman named Etienne Lang, great-nephew of the late, great Parisian Banker David Cahn, who was sent from Paris to San Francisco in 1931 to look after the Anglo Bank interests of the Lazard family. Etienne Lang presently hired a private detective to conduct a secret investigation of Herbert Fleishhacker's affairs. On the basis of this investigation, Lang and his lawyer, a heavy-shouldered Los Angelean named Harold Morton, in 1933 brought suit against both Herbert Fleishhacker and the Anglo Bank in connection with the sale in 1915-17 of oil lands in Kern County, Calif, which belonged to the Lazards. The suit asked damages of over $1,000,000, has lain dormant ever since.

For the purpose, according to the defense, of spurring action in this case, another suit was brought in December 1934 by the Lazard family and certain other Anglo stockholders against Banker Herbert personally and the bank, charging in substance that he had used his position as Anglo president to wangle profits on the side for himself. This was the suit which last fortnight came to trial on the third floor of San Francisco's post-office building in the marble and plaster-cupid encrusted courtroom of Federal Judge Adolphus Frederick St. Sure.

According to the complaint presented by Lawyer Morton, Herbert Fleishhacker in 1919 agreed to let the Anglo Bank lend M. Barde & Sons, Inc. of Seattle and Portland funds to buy steel from the U. S. Shipping Board, in return for which favor he was personally to get half the profits from the sale of the steel. Brothers J. N. and Leonard B. Barde presently received $325,000 from the Anglo Bank, another $175,000 from the Central National Bank of Oakland. The Bardes were successful in their bid for the steel, formed Barde Steel Products Corp. and before long repaid every penny of the loans. The complaint also maintained that President Fleishhacker had meanwhile drawn down $75,000 in salary. $73,000 in dividends, and $200,000 in other secret emoluments on the side. The Lazards claimed that all profits from the deal belonged rightfully to the Anglo Bank since it put up the money.

Much of the evidence for these charges hinged upon an alleged statement by J. N. Barde admitting part of them. But that non-Californian resident refused to attend the trial, and the defense produced a statement by him that the Fleishhacker deal was in entire good faith. Balance of the defense, presided over by famed & fast-thinking Lawyer John Francis Neylan, longtime Hearst adviser, was based principally on the claim that Herbert Fleishhacker never imposed a repayment condition upon any of the loans made to the Bardes, that he had never received any secret emoluments under the guise of salary or dividends. In his brief period on the stand, Banker Fleishhacker categorically denied all charges in the plaintiff's lengthy complaint, maintained he had acted in perfect good faith. Finally Lawyer Neylan called serious little Etienne Lang to the stand and twitted the Frenchman about gold bricks, international debts and finally, in an amazingly facetious bit of cross-examining, about the mythical story of Banker Fleishhacker and the drowned Chinese.

After four days of testimony the case went to Judge St. Sure who seemed to think the case more serious than Attorney Neylan pretended it was, for he announced that his decision would not be handed down in less than a month. As the courtroom emptied and Herbert Fleishhacker chased after Jack Neylan to find out what he thought the judge would decide, husky young Herbert Jr., onetime Stanford footballer and now manager of an Anglo branch, snorted: ''I want to meet that Frenchman!" When his brother Alan dissuaded him, he pleaded: "Father wouldn't have done anything like that!''

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