Stream of Visitors to Her Shop, Where Government Says Under­valued Gowns Were Shown
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SECOND ARREST IS MADE
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Abraham Merritt Surrenders to Answer Charge of Undervaluation in Customs Cases
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Abraham Merritt, formerly Secretary of Lucile, Limited, Lady Duff-Gordon's dressmaking establishment at 17 West Thirty-sixth Street, surrendered himself at United States Marshal Henkel's office in the Federal Building yesterday afternoon to answer a warrant charging him with conspiracy to defraud the Gov­ernment by undervaluation of imported dresses, in conjunction with Thomas J. Duggan, the Manager of Lucile, Limited. Meanwhile all day there drove up to the doors of Lucile, Limited, a steady stream of carriages and automobiles whose occupants gathered in the parlors of the establishment, and discussed with much interest and many expressions of sympathy for Lady Duff-Gordon the Government raid.  Even the footman at Lucile, Limited, seemed to accept the situation with properly refined glee.

Mr. Merritt, who is a newspaper man and now disclaims all connection with Lucile, Limited, and says he is merely a friend of Lady Duff-Gordon, appeared at the Marshal's office with his attorney. He was taken before United States Commissioner Shields, and after a brief examination released on bail of $1,500, which was furnished by a surety company.

Eugene V. Daly, attorney for Lucile, Limited, was unwilling to discuss the case further than in this statement:

"We think that when the ownership of the London house and of the New York house are shown to be practically identical, the District Attorney will not look seriously upon the charges of undervaluation which have been instigated by a discharged employe. The discrepancies, if any, are merely a matter of bookkeeping. The importations are models, so called, and we shall prove that the valuation placed upon them was ample.  Any one familiar with the business knows  that models always sell for less than it cost to produce them."

Who the discharged employe is or who are the officers of the London and New York houses of Lucile, Limited, he was unwilling to state.

 

United  States District Attorney Wise, commenting upon this statement, said yesterday:

 

"We do not care who the officers of the company are, if it has been reor­ganized as stated.  You can't jail a cor­poration.  It is sufficient for us that both the defendants named in the warrant signed the false declarations.  We are unwilling at this stage to tell who has been the informant on whose disclosures the complaint was made. Whether that person shall share in whatever restitution the Government may get will rest in the discretion of the Secretary of the Treasury.  We shall show our hand only when we take the matter into court."

 

The District Attorney intimated that no further arrests were contemplated on the basis of the evidence now at hand, but said that indictments in the present case would probably be brought before the trial. He was unwilling to say how­ much the alleged undervaluation amounted to, explaining that a thorough investigation must be made by the Government officials before he could tell whether it was only a few thousand or more.

 

At the Ritz-Carlton Lady Duff-Gordon denied herself to all inquirers. It was reiterated from her apartments that she had no part whatever in the management of Lucile, Limited, now, but was only an artist engaged to design models for the firm.