Please see the latest from the California Accountability Project.
DATE: Thursday, May 20, 2010
FROM: Nick Velasquez, Director, The California Accountability Project
TO: Political Reporters
RE: Meg Whitmans FTD Fumbles
While Republican Billionaire Meg Whitman may claim shes got the business savvy to govern the State of California, the record
tells a different story.
Whitmans business background is littered with professional missteps and ethically challenged decision-making.
Whitman ran into trouble at eBay and at Keds/ Stride Rite.
Whitmans tenure at FTD was also a disaster, as we detail below.
Whitman failed to turn a struggling FTD aroundand quit, after admitting she couldnt fix the company
The Sacramento Bee reported that Whitman left FTD:
after two disappointing years struggling to turn a profit. This company is not fixable, at least not by me, Whitman told FTD Chairman Richard Perry… – Sacramento Bee, 3/7/10
The New York Times also covered Whitmans disastrous stint at FTD.
It was her two years as chief executive of Florists’ Transworld Delivery in Michigan, though, that proved her biggest disappointment. Ms. Whitman had been hired by the florist-owned member association in 1995 — better known as F.T.D. — to help smooth its transition to a privately held company. Conceding defeat, Ms. Whitman quit in 1997… – New York Times, May 10, 1999
A Meg Whitman-led FTD was charged with violations of federal law by the United States Department of Justice
On Feb. 7, 1995, FTD Named Meg Whitman President; In March, she became CEO
A top executive of Stride Rite Corp. was named president of Florists’ Transworld Delivery Inc. on Tuesday. Margaret C. Whitman was to join the world’s largest floral-delivery company Wednesday. She was a division president at Stride Rite. Associated Press, 2/7/95
Margaret Meg Whitman joined Southfield-based Florists Transworld Delivery Inc. in February as president and became CEO in March. Crains Detroit Business, 8/28/95
On Aug. 2, 1995, The Justice Department Targeted FTD for Anti-Trust Violations
The Justice Department said today that the Florists’ Transworld Delivery Associationwould settle an antitrust complaint by agreeing to stop its attempts to keep florists from using rival delivery services. The department said the association, known as F.T.D., had violated a 1990 consent decree that prohibited the organization from offering incentives to induce florists to use its service exclusivelyUnder a petition filed in Federal District Court in Detroit, F.T.D. agreed to stop its F.T.D. Only incentive program to induce florists to use its service exclusively and said it would not adopt any similar program in the future – New York Times, August 3, 1995
Anne K. Bingaman, Assistant Attorney General in charge of the Antitrust Division, emphasized the importance of this action –both in fixing this violation and in warning other defendants that are covered by antitrust consent decrees. – Justice Department Press Release, August 2, 1995
D.O.J. Official: FTD Only Program Was A Clear Violation of Law
This so-called FTD Only program was a clear violation of the 1990 Consent Decree because it had the effect of limiting membership to FTD. FTD has agreed to end the FTD Only program and to set up an internal antitrust compliance program. – Remarks Before the National Association of Attorneys General by Assistant Attorney General Anne K. Bingaman, Baltimore, Maryland, October 11, 1995
Whitman was sued for age discrimination/ entered into secret settlement
The Los Angeles Times (5/12) reported:
Whitman, while at FTD, ended another court case with a secret settlement after being sued, at age 39, for age discrimination.
In December 1995, eight months after Whitman took over as chief executive ofFTD, she fired her 55-year-old technology chief, Dave Carlson. She replaced him with a man almost two decades younger, according to the lawsuit Carlson filed in a suburban Detroit court near FTD’s headquarters.
Whitman told some staff members that the company was too old and stodgy, Carlson alleged. He also said she told a conference room full of senior managers: We need about 15 killer young executives.
FTD’s vice president of government affairs interrupted, telling Whitman that she didn’t mean to use the word young, the complaint said. Actually, I do, Whitman allegedly replied, but I get your point.
Information Week (2/26/96) reported:
Shortly after Carlson joined FTD last March, Margaret Whitman, then 38, was named CEO. Whitman terminated Carlson’s employment on Dec. 19 according to the lawsuit and named William Phelan, 39, as acting CIO. The lawsuit alleges that Whitman referred in meetings to the need to hire killer young executives, Young Turks, or people who are about 26 years old..Dennis Blondell, 45, director of systems operations at FTD’s Downers Grove, Ill., facility, says there are a lot of new folks here, and most of them do seem (to be) under 40.. [A]n ex-IS employee, who requested anonymity, says FTD’s management frequently spoke about recruiting killer bees, young MBA-types, to come in and get things done. An FTD spokeswoman declined comment on the suit.
Meg Whitman says she wants to run California like a business.
But the record shows Whitman’s tenure at e-Bay, Stride Rite, FTD, and other firms to have been filled with bungles, blunders, and the kind of misconduct that has rightfully earned Wall Street the disdain of Main Street.
If past is prologue, then a Governor Meg Whitman would cut legal and ethical corners, and STILL failin the end.