Posted on 08/07/2002 7:51:45 AM PDT by gubamyster
Courts: He insists his role in ill-fated partnership was limited, but court papers show he was involved in every phase.
By MICHAEL FINNEGAN and JEFFREY L. RABIN, Times Staff Writers
As he campaigns for governor, Republican Bill Simon Jr. says he played almost no role in the business fiasco that led a jury last week to levy $78 million in damages against his family's investment firm.
He casts himself as a peripheral player in the William E. Simon & Sons investment of $16.5 million in the pay phone company of Paul Edward Hindelang Jr., a convicted drug trafficker who won the Los Angeles fraud case.
But court records show that Simon, who personally lost more than $1 million in the deal, participated in every stage of the partnership:
Simon, then executive director of the family firm, met Hindelang after the Pacific Coin founder chose William E. Simon & Sons from a group of suitors competing to invest in his pay-phone company.
(Excerpt) Read more at latimes.com ...
I'm sure the facts in the article are accurate, but the headline leaves a very misleading impression. Or I suppose it depends on the definition of "involved".
What it says is that he expressed reesrvations on the investment, and the vote supported it, so it went ahead. (No direct word on how he voted; the article slyly implies that he voted in its favour, but I doubt it).
Then, when a report circulated in the company on the investment's status, he wrote comments in the margins asking pointed questions about the situation. They were the kind of things I would write if I was looking at something I had not viewed for a long time, and was trying to size up its present potential.
Now, if you would call that a significant involvement, contrary to what Simon claimed, I would respectfully tell you you are wrong. It is indictive of someone who has gone on to newer and better things, leaving the company to its professional managers. (This is routine; it's simply how venture capital works). What we see are the comments of someone who is juggling dozens of balls in the air and only has an hour or so for this one.
So either the LA Times writer is incredibly unsophisticated in business, or he simply wanted to write a hatchet job on Simon. If he did, he did an exceptionally poor job -- except in that headline, which I expect in a Gray Davis campaign ad very soon.
D
Excellent analysis.
Actually he was just doing what his managers told him to do!
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