Pink Slips and Parting Gifts

by Deb Hosey White

  In the News

  September 17

  THE FORBES 400

  A List Of The 400 Richest Americans Sorted By Rank...

  #321 George Miles

  Net Worth: $1.9 billion

  Source: Real Estate

  Self made

  Age: 56

  Marital Status: Married, 2 children

  Hometown: Denver, CO

  Education: Washington University, Bachelor of Arts/Science

  Former mortgage broker developed mixed use projects beginning in 1977. Took Pratt-Miles public in 1992. Relocated business to Denver in 2000. Last year paid $13.1 billion for storied Virginia developer Easton Co.

  The same year Pratt-Miles decided to end medical benefits for Easton retirees, George Miles and family moved onto the Forbes 400 for the first time at position 321. On the list of the 400 richest Americans, this placed George Miles just behind the Rockefellers, with a net worth of $1.9 billion.

  George Miles celebrated his good fortune by building a mansion on Billionaires’ Boulevard in Denver. The new home spanned four city blocks. Conservative estimates placed the cost of the property upon completion at nearly $18 million. The new home included a rooftop solarium, a vast wine cellar, eleven bathrooms, an indoor running track, a climate controlled art gallery and a pipe organ.

  Pratt-Miles’ move to end benefits for Easton retirees was a basic business decision, according to a statement from the company’s management. “It would have been unfair to provide any type of post-retirement benefits to the Easton population when we don’t provide anything comparable for our own employees. It’s really a matter of equity,” the Pratt-Miles spokesman concluded.

  Unreported in the press was the number of Easton retirees in their sixties, seventies, eighties and nineties who were thrust into poverty that year, unable to afford medical coverage on their own, and decimated by medical bills.

  Pot Luck

  Eleven months after the merger closed, a large group of former Easton employees and retirees gathered at a town home in the District of Columbia for a potluck supper reunion. Less than a year ago they had all worked together for the same company. Now only five among those present were still employed by Pratt-Miles. Of those five, two would be laid off by the end of the fiscal quarter.

  Most everyone in attendance had found a new job or had decided to retire. Some, already unhappy in their new work environment, were again searching for their next job opportunity. All agreed the work life they had enjoyed at Easton was difficult to replicate elsewhere. A few people talked about lower stress in their new jobs but most mused over days gone by. Everyone agreed what they missed most was the caliber of people they worked with at The Easton Company. The number of former employees who showed up for this potluck dinner on a beautiful fall Saturday evidenced the sentiment.

  As the wine and beer flowed the reminiscing intensified. Easton was a forty-eight-year-old company with an entire catalog of corporate stories – good, bad, humorous and embarrassing. Kate Cooper found herself thinking someone should write this stuff down. With everyone now scattered, and so many of the founding employees in their eighties, all this great storytelling could soon be lost.

  Clinton Hecker was a retired Easton engineer. He was originally hired by Ed Easton and then worked thirty-five years for the company. Surrounded by a group of both retirees and younger ex-Easton employees, Clinton reminisced about the early days when no one at Easton was making much money but everyone loved the work and lived comfortably. No one, not even the CEO, was wealthy.

  “Around the holidays, one day you’d come to work and a Christmas tree would be there in the lobby of the headquarters building. Then another day you’d come to work, and envelopes containing our bonus checks would be pinned to the tree. There was no telling when any of this would happen – no particular schedule – it just did. Then Ed would call us all down to the lobby and we’d have a drink, eat some cookies and open our checks. It was the only time in my life I’ve ever seen a grown man faint dead away. Yep, Ed was that generous when he could be, and he loved giving. But a big check was a whole lot smaller in those days. A few hundred dollars was a big deal.”

  Another Easton retiree, Fred Burns, talked about the beginnings of the vacation cottage program, a benefit Ed initiated after striking up an elevator conversation with one of the employees.

  “Ed asked the young employee where he was taking his family on vacation that summer. The employee confided to Ed that he really didn’t have time to go on vacation, much less the money. So Ed started the cottage program. In those good old days, everyone at headquarters got one week at a mid-Atlantic beach cottage. It didn’t matter if you were a secretary or a vice president. You’d go pick up that envelope from personnel and it would have the directions to the cottage and the keys inside, along with an extra week’s pay. It wasn’t just Ed’s vision that was revolutionary. It was the way he cared about the people who worked for him. Of course all that ended when the money guys took over.”

  “The money guys?” Kate raised an eyebrow.

  “Yeah, the money guys, Kate. The senior management team who took over the company when Ed retired. They weren’t people-focused like Ed. They were the money guys.”

  “Ah,” Kate replied. “I understand. I must say I never dreamed I’d personally know so many millionaires. Twenty-seven Easton executives woke up one morning last fall as newly minted millionaires, simply as a result of the merger.” She shook her head, “Overnight, just like that,” Kate snapped her fingers, “their fortunes were made.”

  “So tell me Kate,” Fred asked. “What made those twenty-seven people so special? What made them more deserving than you or me?”

  “Good question, Fred. Kismet, perhaps? I don’t think we’ll ever know.”

  The eBay Chronicles

  Pratt-Miles’ director of purchasing was an energetic and brazen young man named Blair Christie. After joining the company, he quickly gained notoriety among senior management. He proposed using eBay to efficiently dispose of the company’s outdated office equipment and furnishings while generating modest cash flow. The division vice president gave Blair a month to demonstrate the cost-benefit of using eBay at the corporate level. Three weeks later Blair sent the VP a report reflecting a tidy profit on the disposition of thousands of dollars worth of used company property that had been sitting in a rented storage facility. From that day on, Blair’s title might as well have been eBay Wizard.

  For Blair Christie, the Easton/Pratt-Miles merger was the corporate equivalent of getting the key to a rich and discriminating grandma’s attic. Following the close of the sale, as the audit reports from the field rolled in one after another, Blair’s email inbox filled up with bits of information from different department heads about possible assets to be sold.

  There was the usual long list of excess computers and related office machine paraphernalia, furniture, and company cars. Also, an entire set of skybox tickets for the local NFL games where the waiting list for season ticket holders was often decades long.

  But the fun stuff was comprised of The Easton Company’s unique art trove. All these pieces were one-of-a-kind art and artifacts that The Easton Company had displayed throughout the headquarters building during its history. This was the stuff that made Blair Christie salivate as he anticipated watching the eBay bidding. Included in this haul and stored in a warehouse in the Washington suburbs were some museum-worthy 1960s pop artwork, a wooden carousel horse from the Chicago Worlds Fair, an antique pig weathervane rescued in the ’70s from a colonial building in Boston slated for demolition, and a Hepworth sculpture.

  The real find – the equivalent of an Antiques Road Show jackpot with provenance – had been sent over from a law clerk in the legal division. It was an Iron Mountain box labeled “HRH docs/gloves/goggles” with an accompanying note from the clerk that read simply, “What do you make of this? For real?”

  When Blair opened the box, what he saw first was old packing material. But buried d
eep in the folds was a pair of very worn brown leather gloves that appeared to be quite old. The condition of the leather reminded him of his grandfather’s WWII bomber jacket. Underneath the gloves was a pair of goggles that looked as old as the gloves. They had dark green glass with leather straps and an antique fastening clasp. Tucked into one side of the box was an aged folder containing three short documents.

  The first paper appeared to be an original, typed on yellowing onionskin typewriter paper. It was a note of appreciation for the recipient’s “heroic actions in saving my life. In addition to the mementos I left with you that day, please accept as my gratitude my promise to pay you and your family $150 a month for the rest of your lives.” The note was signed in blue fountain pen ink: HRH.

  The next document was three pages long and also typewritten. It explained that the aviation goggles and the gloves had originally belonged to Howard Hughes. He had given them as a token of appreciation to a young farmer in whose field Hughes had crash-landed a plane decades before. The farmer had seen the plane go down and driven his tractor to the site, helping Hughes out of the wreckage, allegedly saving Hughes’ life. When the farmer died, his wife sent the goggles and gloves back to Hughes with a letter thanking him for his generosity and hopeful that the monthly payments would continue. The document stated that upon receiving the wife’s note, Hughes instructed his attorneys to draw up a promissory agreement. The agreement assured the payments would continue for the lifetime of the farmer’s wife and the lifetimes of their three children.

  The last document in the folder was an executed copy of the notarized promissory agreement signed by Howard Hughes. On the final page of the agreement was a handwritten notation, “Easton post-acquisition obligation. December 1989.”

  Blair Christie held the goggles and the gloves in his hands and felt his fingers and toes tingle. He’d seen a lot of good stuff in his days, but this was definitely a defining moment. He carefully placed the items back in the box and called the senior Pratt-Miles accountant in charge of cataloging all the periodic cash obligations they had taken over from Easton post-merger. He asked her to look for payments to any of the names shown in the promissory agreement and call him back as soon as possible. Thirty minutes later his phone rang.

  “OK. This is weird. Apparently there are three annuity-type payments of fifty dollars each going out monthly to the last three names you gave me. Unlike the other monthly payments we inherited, these aren’t marked retiree or employee. In fact, there’s no notation explaining what they are. Nothing showing up for the first woman’s name, though. What’s this all about?” the accountant asked.

  “I’ll send you a copy of the documentation for the payments that I just found. Once you’ve read it, come see me and I’ll give you the rest of the story,” Blair offered. “Gotta go.”

  Two more hours of phone calls and Blair had most of the story nailed down. The $150 monthly annuity was still being divided among and paid to the farmer’s three surviving children, now in their sixties. Both the physical assets and the liabilities had passed to The Easton Company after it acquired a small office park in Las Vegas that included a hangar, transportation offices and several hundred acres of land that belonged to the Hughes heirs.

  For Blair Christie, the find of a lifetime was in his possession. He imagined himself much older, telling his future children and grandchildren the Howard Hughes story. No doubt the keepsakes would bring a tidy sum to the company; which would, of course, help boost what was sure to be a very fat year-end bonus for the Pratt-Miles eBay Wizard.

  Bottle and the Damage Done

  Tim Ferris, Easton’s short-term director of auditing, wasn’t the first employee let go after the merger, but he might have been the employee who took it hardest.

  Pratt-Miles eliminated Tim’s job one month after the merger closed and just days before Christmas. The layoff took place less than a year after Easton lured him away from his prior employer, another Fortune 500 company. In his current circumstances, the job that Tim abandoned so readily for Easton now seemed more wonderful and promising than he ever imagined while he was actually in it.

  With less than a year of service at The Easton Company, Tim’s severance package was the equivalent of a Happy Meal compared to the payouts his longer-term peers at Easton were receiving. All the promises that were made when he took the Easton job just didn’t have time to materialize. And when his job was eliminated, the executives who had made those promises were no longer present. It seemed more than unfair to Tim. He felt royally screwed.

  By mid-January, Tim had filed a lawsuit against both Easton and Pratt-Miles claiming breach of contract and other allegations piled on by his attorney. Tim sued for a severance package he would have received if he had worked at Easton for ten years; not just eleven months. If the company had not been acquired, Tim argued, he would have stayed for at least a decade. Although it sounded a bit unorthodox, the overall legal argument seemed to make sense. At least that’s what his attorney kept telling him. After five months, however, Pratt-Miles offered and Tim – on advice of counsel – accepted a meager $3,000 settlement, most of which went for legal fees.

  Tim was angry. His general good mood and easy disposition had vanished in the six months after the merger closed. He woke up angry and went to bed angry. No one wanted to be near him. His anger made it difficult for him to interview for new jobs, even though he was well qualified.

  Being home for months with the twins and his wife was making Tim edgy. He was definitely getting on his wife’s nerves. He talked constantly about how he had been cheated. She wanted him to get over it and move on. He was embittered, resentful and having trouble letting go.

  When Tim’s unemployment benefits ran out, his wife noticed her husband more frequently standing at the kitchen sink staring out the window with a whiskey glass in his hand. When he started pouring his first drink before noon, she calmly suggested he needed help.

  Hell, he knew he needed help. What did she think the past six months were all about? But clearly the kind of help she was suggesting was not the kind of help Tim had in mind.

  A year later, sitting in a group counseling session in the rehab center, Tim knew exactly when his fate had changed and when he started drinking seriously. He told the group it started long before the lawsuit and before the constant anger had settled in. It started before all the unsuccessful job interviews and the split with his wife and his loss of joint custody of his children. He could trace it all back to that morning when he got the flat tire and the call about the sale of The Easton Company. After sopping up his sweat with a disposable diaper and hobbling home in his wife’s car on the donut spare, he walked into the house at 10 a.m. and poured himself a large tumbler of whiskey. A song was playing on the radio in the kitchen – he never did figure out the name of the song or the group. But as he sat there in a sweaty Armani suit, the lyrics seemed written for him in that moment in time:

  I’ve been cheated, I’ve been lied to,

  I’ve been misunderstood and told I’m no good.

  “Those lyrics have been spinning through my head for months,” Tim told his group. “Now what I want most is to turn back the clock. I have given this a lot of thought. At first I wanted to turn the clock back to that morning on the side of the road, thinking if I had another chance, I wouldn’t start drinking. But on further reflection…”

  “And many more hours of therapy,” one of the group members inserted.

  Tim only half grinned, “On further reflection and additional therapy, I am now certain I want to turn the clock back to before I left my prior job.” Tim went on to describe his wonderful position with the international Fortune 500 firm that provided him a lucrative lifestyle and lots of exciting travel. “I would have made senior vice president by now, no question,” Tim concluded. “And the travel would have taken me away from home enough to keep my marriage intact and provide some distance from the demands of toddler twin boys.” Tim leaned back in his chair and folded his ar
ms, indicating he was done.

  The group counselor shook his head. “Tim, unfortunately the time machine has yet to be invented. Instead of looking back, you should look to the future to sort out your life problems and rectify your current situation.”

  Not likely, Tim thought to himself as the group discussion passed to the next participant. Tim’s wife had recently filed for divorce. Unbeknownst to her, the money required for him to settle his debts was long gone. He had blown through his severance payments and the little bit of savings that remained after the twins were born. He even spent all his retirement money, including his 401(k) assets and pension plan distribution, which required forging his wife’s signature on the documents. No, Tim thought. Looking forward was definitely not the answer.

  As the group discussion droned on, Tim began to daydream about each brand of whiskey he had ever tasted, in alphabetical order.

  Tales of the Sofa – Down-Streamed

  The Easton yellow sofa sat on the loading dock at the rear entrance of the former headquarters building. Unfortunately, the sofa’s last caretakers were located on the lower level of the building where damage from the storms had caused the roof to leak and ceilings to cave in. In the clean up, the sofa was discovered soaked with water and covered by crumbling ceiling tiles and fallen insulation. Unpleasant brown water stains obscured its once light yellow leather. The sofa’s fill had shifted to one side giving it a lopsided look, yet The Easton Company logo was still visible.