Hey Aroyem, you scum sucking-Amos-Aharoni-wannabe-crim, put this article on the NCDR CEO and shampoo salesman William Roger Dunavant in your bong pipe and take a deep toke....don't forget to take your finger off the carbureator.
Enjoy the read, Mr. Pin(
LEVEL 1 - 6 OF 50 STORIES
Copyright 1996 UMI, Inc.; ABI/INFORM
Copyright Forbes, Inc. 1996
Forbes
September 23, 1996
SECTION: Vol. 158, No. 7 Pg. 126-128; ISSN: 0015-6914; CODEN: FORBA5
LENGTH: 1090 words
HEADLINE: King Lear?
BYLINE: Conlin, Michelle
BODY:
Headnote:
How a con man brought down a 25-year-old family business
IN JANUARY 1994 FORBES published a glowing article on a little-known
entrepreneur named Roger Dunavant. Dunavant had taken over Straight
Arrow
Products, Inc., a tiny Bethlehem, Pa.-based maker of horse-care
products, and
started marketing the firm's horse shampoo, Mane 'n Tail, for human use.
As
Straight Arrow's sales went from $ 500,000 in 1990 to $ 44 million in
1994,
Dunavant became a celebrity. People magazine shot him taking a bubble
bath with
his kids. Ernst & Young named him a 1995 Manufacturing Entrepreneur of
the Year.
Advertising Age even featured Straight Arrow as one of its 1996
Marketing 100.
The former U.S. Navy seaman owned two BMWs, played golf in Hawaii and
ran a
red-hot company. Turns out we were taken, and so were all the others who
bought
his line. Dunavant is a persuasive scoundrel who plundered the company.
As of
Mar. 31, 1996, Straight Arrow had a negative net worth of $ 316,100-with
further
deterioration expected-according to a courtappointed custodian's report.
A
Pennsylvania court has found Dunavant, 44, guilty of awarding himself
millions
in excessive compensation, siphoning off company funds to cover personal
expenses, and diverting Straight Arrow assets.
FORBES prides itself on smelling a con man a long way off. How did we
fail to
spot the whiff of fakery on this one? No excuse. We guess our editorial
nostrils
were stuffed that day. Straight Arrow got its start in Phillip and
Bonnie
Katzev's N.J. kitchen in 1971. When the horsey couple divorced in 1986,
Bonnie
Katzev wound up as sole owner, but, burned out, she no longer wanted to
run the
equine-products company. So in the early 1990s she sold half the firm to
Dunavant, who had headed up sales and marketing for Straight Arrow since
1989.
To keep the company in the family, she sold the other half to her
23-yearold son
Devon, who was named after Philadelphia's famous Devon Horse Show.
Devon showed little interest in the business. Although he had idly
taken a
few courses at a local community college and had attended welding school
to
learn how to fit pipes, the long-haired dreamer thought mainly of
becoming a
rock star.
(Photograph Omitted)
Captioned as: Roger Dunavant with one of his children, as
photographed for
a 1994 article in People The media turned this scoundrel into a
celebrity.
Bonnie Katzev, a disciple of something she calls Mind Science, which
"seeks
pathways to communicate with the higher realms," apparently hoped her
son would
grow into the job while Dunavant minded the store. In a letter later
introduced
in court, she wrote of Dunavant: "I do believe the universe sent me the
best
mass marketing intellect under the universe's context."
As a marketing man, Dunavant certainly had talent. He transformed
Straight
Arrow from a steady seller of equine products to a fast-growing
cosmetics firm
for humans. He took the product to drugstores, supermarkets and mass
merchants.
He introduced new spinoff products in elegant black bottles and invested
$ 2
million in new production facilities.
But he also began crossing the line between acceptable hype and lies.
Dunavant told naive reporters that Mane 'n Tail made his hair grow so
fast he
had to cut it every three weeks. He said doctors were recommending the
shampoo
to chemotherapy patients. Routinely, he represented himself as Straight
Arrow's
sole owner, even though he owned just half the company.
Pretty soon he was acting as if he really did own it. According to
the
lawsuit, he had Straight Arrow cover personal expenses, such as a family
holiday, and personal legal fees. A judge has ordered an audit to
determine the
extent of Dunavant's abuse. From 1990 to 1994 he granted himself $ 7.3
million
compensationalmost triple what the court decreed was "reasonable." As
his
shenanigans went unnoticed, Dunavant became ever more emboldened,
transferring
assets from Straight Arrow into companies owned by his family. He also
had
Straight Arrow lease office space at four times market value from a
company
partly owned by his wife.
While Dunavant pillaged Straight Arrow, his "partner" Devon Katzev
didn't
notice a thing. Still taking the occasional community college class and
working
odd jobs at Straight Arrow, Katzev happily received from Straight Arrow
$ 650 a
week, plus $ 300 a month in car allowance. In court earlier this year,
he
explained: "I was kind of, like, my hair's long, I'm in this rock
status. I was,
like, all right. That was basically my attitude back then. I wasn't,
like, big
businessman walking in the room and going, 'Let me see the financials.'"
But in 1993 Katzev, then 25, got serious. "I totally made a
one-eighty in my
life," he testified. Katzev heard rumors, such as the one about
Dunavant's
lawn-care bill being paid by Straight Arrow. He finally took a good look
at the
books and hit Dunavant with a lawsuit in Northampton County, Pa. court.
In
February 1996 Dunavant was ordered to repay Straight Arrow $ 4.5
million. As
court-ordered audits of Straight Arrow's books continue, he may be
coughing up a
lot more. Booted from his job at Straight Arrow, Dunavant is now
appealing the
outcome in Pennsylvania Superior Court. He also faces a second lawsuit
filed by
Katzev charging him with diverting Straight Arrow assets.
Mark Kearney, Dunavant's current lawyer, claims that Devon is just a
stalking
horse for his dad, Phil Katzev, who wants to recapture control of the
company he
cofounded 25 years ago. "Roger built this thing up for Phil, and now
Phil's come
back to steal it," Kearney says. "It almost reads like something out of
Shakespeare." But Dunavant is a rather unlikely King Lear. The facts
that came
out in court show him to be a classic con man.
On July 15 Devon Katzev was named Straight Arrow's president. His dad
is
acting as a consultant. Devon, now 29, says he wants to make Straight
Arrow what
it once was. It may be too late. Wal-Mart, for one, has moved Mane 'n
Tail off
its beauty shelves and into its pet department. "The trend didn't last,"
explains Wal-Mart spokesman Keith Morris. "The horse-shampoo fad is
over,"
agrees Robert Albert, national sales manager of Rio Vista, a line of
horse
shampoo launched in 1993 by legendary hair-care entrepreneur Jheri
Redding.
Moral: If a success story looks too good to be true-it probably is.
(Photograph Omitted)
Captioned as: Straight Arrow's president, Devon Katzev While Roger
Dunavant
pillaged the company, Katzev didn't notice a thing.
LANGUAGE: ENGLISH
JOURNAL-CODE: FBR
AVAILABILITY: Full text online. Photocopy available from ABI/INFORM
921.00
ABI-ACC-NO: 01285085
LOAD-DATE: September 30, 1996 |
