The Pearsite Company, organized under a cloak of secrecy, became one of the most highly publicized dye making ventures of the World
War I era. The firm was incorporated in Delaware on June 23, 1915 with capitalization of $2 million. The original subscribers of the stock
were Arthur J. Kingsbury, M. M. Hirous and James M. Satterfield, all of Delaware. These individuals were regarded as “dummies” since
they held only a few shares and were listed to satisfy the Delaware law requiring the names of at least three stockholders.
It was later revealed that the principal financial backer was Col. Henry P. Bope, who was president of the Pearsite Company. Col. Bope
was vice president and general manager of sales for the Carnegie Steel Company of Pittsburgh. The Board of Directors of Pearsite was
composed of Arthur L. Pearse, vice president; Wheeler B. Horner of Pittsburgh, secretary; and Nathaniel W. Niles of Boston. Horner was
married to Bope’s daughter Laura. Niles was well known to the public as a tournament tennis player representing Harvard University.
The company had offices in New York and Pittsburgh.
In September 1915, Dr. Thomas H. Norton, the U.S. government expert on the dye industry, announced that Pearsite had invented a new
process that would revolutionize dye manufacture and free the country of its dependence upon Germany. The inventors were Pearse, an
English mining engineer, and Dr. Charles H. Gage, a chemist from California. Dr. Gage also had a background in mining, having purchased
the Angelus gold/silver mine in California for $500,000 in 1903. He and Pearse had worked on the new method for several years but they
did not apply for a patent in an effort to keep the technology secret. The process involved the oxidation of cannel coal and was claimed to
simplify the extraction of coal tar chemicals such as benzene, the precursor to aniline and a large range of dyes.
Col. Bope had the process validated by a second chemist, J. Morrow Campbell of England, who was brought to the site of the operation in
Cannel City, Kentucky. He carried out the research in a small lab that was setup in a freight warehouse across from the Hotel DeLancy.
The 65 year old scholar, who spoke several languages, was an avid tennis player who helped build the first tennis court at Cannel City.
Dr. Gage had a facility on the Spring Branch of the Brush Fork River. He was an extrovert who boasted about the project to the residents
of the area. He and Campbell often met in the hotel dining room where he expressed pro-German sentiments. Campbell retained his
composure as a gentleman during these heated discussions.
A large plant was constructed in Cannel City, located in the cannel coal district, before the process breakthrough was publicized. The
furnace for oxidizing the coal was built by the John F. Casey Co. of Pittsburgh. Persite was so confident of success a second furnace
was ordered. Production began in September 1915 and the dye making capacity was expected to increase to 10,000 lbs. per day by
December 1915. The capacity could eventually be increased to 40,000 lbs. per day. The processing of coal to finished dyes at one
location was expected to be a significant advantage compared to competitors that had to buy intermediates.
The initial product range consisted of five colors: a sky blue, a direct black, a benzol red, a wool black, and a direct green. The sales
agent was F. Bredt & Co. of New York with John Lindemann handling the account. Lindemann said the quality and fastness properties
were equal to that of the best imported dyes. He was convinced of their applicability to cotton, wool, and silk fabrics. The product range
was planned to expand to 70 primary colors and shades.
But there some skeptics of the new process, especially among the importers of German dyes. Herman Metz, head of the U.S. sales
agency for the Fabrikwerke-Hoechst company, which had large factories in Germany, said "We have hundreds of men coming in to see
us who think they have something that will solve the dye problem. Every clerk in the country with a tin can of coal tar thinks he is on the
verge of discovering a process that will revolutionize the industry. To talk of disposing of the whole trouble and making 100 or 1,000
colors at one swoop is ridiculous. The efforts of certain men to get a protective tariff, so that the manufacture of dyestuffs here may be
safeguarded, is something else that carries no weight with those who know conditions. The only way the dyestuff scarcity is to be
relieved is through the Government taking action to insure shipments through neutral ports."
The Pearsite Company soon collapsed and the plant was sold for junk on July 3, 1917, validating the dire prediction of Metz. But Metz's
assertion that America could not manufacture its own supply of dyes was proven wrong by the end of the war.
Charles H. Gage was granted several patents in the 1920s concerning an electric furnace and safety improvements in the mining and
railroad industry. In 1924 he received US patent no. 1515103 for a digester to extract hydrocarbons from shale or cannel coal without
high pressure or destructive distillation.
Col. Bope remained vice president of Carnegie Steel until April 1, 1918, when he retired to organize the American Steel Corporation. This
company planned to build plants in Sandusky, Ohio and in the northern part of Alabama, where the firm had large and valuable coal and
ore interests. American Steel was expected to employ 500 men at the Sandusky plant and 3,000 in Alabama. But this venture failed, along
with other investments Col. Bope made.
He then became involved in the Petroleum Producing and Refining Company which went bankrupt in 1920. Col. Bope, the secretary and
treasurer of the company, William A. Stuart, president, and three salesmen were indicted in 1922 and charged with stock fraud. The
federal government alleged that the name of Charles M. Schwab, chairman of the Bethlehem Steel Corporation, was used without his
permission in a stock offering circular. The gushers predicted by the company did not come in; the only oil found was worth just $4,295.
At the trial In 1926, two of the salesmen were convicted, but Col. Bope, Stuart, and the third salesman were exonerated.
Almost all the men associated with Andrew Carnegie in the early days of the steel industry remained wealthy throughout their lives. Col.
Bope was the exception. His bad luck caused him to almost disappear from public life. But he could be seen on Saturday afternoons in
the Pittsburgh market, carrying home his groceries in a basket for the coming week.
1) "Valuable Mine Sold", Daily Nevada state Journal, April 29. 1903
2) "To Make New Dyes, 5 Tons A Day, Dec. 1", The New York Times, September 5, 1915
3) "$2,000,000 Concern To Make Dyes Here", The New York Times, September 8, 1915
4) "Pearsite Co. Begins Dye Output Today", The New York Times, September 9, 1915
5) "Pearsite Dyes Bear Test", The New York Times, September 10, 1915
6) "New Pearsite Dye Is Now On Market", The New York Times, September 15, 1915
7) Williams Haynes, American Chemical Industry, Vol. III, D. Van Nostrand, New York, 1945, p. 236
8) William F. Johnston, "Memories of Youth Spent in Cannel City, Kentucky", Morgan County Kentucky Genealogy at website:
action=get_message&mview=0&ID_Message=236&LastModified=4675414761375694785; accessed April 10, 2006
9) "Most 'Partners' of Carnegie Got Riches and Held Them", Kansas City Star, March 24, 1926
10) "Two Found Guilty in Oil Mail Fraud", New York times, April 8, 1926
Cannel City, Kentucky
|Col. Henry P. Bope, Founder of Pearsite Company
Click to Enlarge
|Photos: Cannel City Long Ago, website at
http://www.geocities.com/scoxer2003/CANNECITYOFLONGAGOCONTINUES.html. Click Photos to Enlarge
Cannel City, KY ca. Early 1900s
Hotel DeLancy ca. Early 1900s
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