Family Firms

Carlson mommy to son: you’re grounded… and fired.

carson family.jpg It’s family business hump day here at DealBreaker, with those wacky Bancrofts (or at least some of them) trying to stonewall the News Corp bid for Dow Jones. In other, more Midwestern family troubles, Curtis Nelson, former COO and President of the Carlson Companies, has sued his former employer and its current CEO, which happens to be his mom. Curtis is the grandson of the company founder Curt Carlson, who started the company in 1938 with a $55 loan and some Brylcreem. Today, the Carlson Companies is one of the largest family-owned companies in the US with over $5bn in annual revenue.
Carlson Nelson, the son of Curt Carlson (the son of Nelson Carlson Curt Nelson Carlson), was ousted as CEO of the Carlson Companies last year, and banned from the corporate headquarters (he kept showing up out front holding up a boombox playing “In Your Eyes”). This is when mommy dearest decided that the whole Carlson primogeniture thing wasn’t flying, so she decided to cut the cord and not hire her son as the company’s next CEO.
One of her more minor qualms was her son’s rampant drug addiction, from the Minneapolis StarTribune:

Despite the agreement to stay sober, “Curtis used his company computer and company e-mail system — in 2006, while he was president and COO — to make purchases of large quantities of controlled substances from multiple on-line pharmacies,” the company response said. “He also ordered a product called ‘Quick-Detox,’ which is advertised as helping users to ‘pass any drug test!!!’ ”

Curtis had a liver transplant in 2000 after mucking up his first one with painkillers. Curtis, new liver in gut, quickly returned to his happy hobby. He vowed to kick drugs for good after a forced leave of absence from the company in 2003. Now Curtis, back in the habit again, has been permanently cut from his duties.
Curtis is not taking his banishment to the time-out step well, and claiming in his lawsuit that he was the rightful heir to the Carlson throne.
Even if Carlson is ultimately left on the curb, the man can afford prescription drugs. Not only does his severance package include continuing health insurance, but the man did earn a $5.5mm bonus last year from the company and $5.4mm more over the last two years from dividend cash distributions.
This is a page taken from the Liesel “Little Princess” Pritzker school of family lawsuits. Liesel, the Paris Hilton of Hyatt (sans herpes, multiple surgeries, coke habit, sex tapes), sued daddy dearest for mismanagement of her trust, which contained a paltry $500mm when it trickled down to her, instead of the multiple billions she was expecting (that’s not a joke unfortunately). Harrison Ford’s daughter in Air Force One settled out of court in 2005.
From hospitality to hostility – [Minneapolis StarTribune]

  • 02 Nov 2006 at 3:01 PM
  • Companies

Keeping It In The Family

JP-Morgan-Edward-Steichen_S.jpgWe’re sort of obsessed with family firms. They’re intriguing because their persistence and success seem to go against the grain of so much contemporary thinking. Unlike in times past, people now are kind of uncomfortable with the idea that who you are and what you’re capable of depends on who you are related to. Sure, we all think it helps to be born with certain material “advantages” but there’s also the tendency to think that these problems can be ironed out with proper professional training and equality of opportunity. Discovering the business success might be a heritable trait is a bit discomfiting, to say the least.
A lot of people have a lot invested in the idea of the professional manager. Business schools, for instance. But as this review of business historian David S. Landes’ new book Dynasties points out, “the business-school mythos of the ‘professional manager’has led to a persistent underestimation of the importance of family firms. Fully a third of Fortune 500 companies can properly be characterized as family businesses, and on average they outperform the “professionally managed” firm by a surprisingly large margin.”
See? It really does matter who your daddy is. Except when it doesn’t.
Old Money [New York Times]