By Kyle Munzenrieder
By Kyle Munzenrieder
By Kyle Munzenrieder
By Francisco Alvarado
By Tim Elfrink
By Kyle Munzenrieder
By Kyle Munzenrieder
By Tim Elfrink
Nobody could get the indomitable Jean Rich to slow down until cancer finally grounded her. One of the first women in the United States to own and operate her own airline, she was relentless in her pursuit of success. At the headquarters of Rich International Airways, located in the northeast corner of Miami International Airport along NW 36th Street, she'd eyeball each invoice, castigate troublemakers, chew out regulators, question every discrepancy, bark orders at the men who surrounded her. She dictated how her four children behaved and with whom they could associate. And she openly bossed around her second husband.
For months she ignored the pain in her abdomen as the disease took hold. She ignored her daughter's pleas to seek medical advice. She ignored the telltale swelling. By the time doctors finally cut her open in 1991, the cancer had already run rampant.
Members of her family took their places at her bedside at South Miami Hospital. The daughter, Linda Harrington, scrutinized the pages of her medical chart, fetched her slippers, checked her medicine, monitored her breathing (she was asthmatic), and hollered for the nurses. The sons -- David, Stephen, and Michael -- hovered nearby. The stepfather, Bill Meenan, second in command at her airline, sometimes left the hospital room, cellular phone in hand, to keep the business running.
Rich International Airways was having a good year, in large part because just twelve months before her death, Jean Rich had entered into a business deal with a competitor, a deal both risky and controversial, but which also held promise for the airline's future. In a paradoxical way, that deal would also help to define the lives of the daughter and husband when their quarrel over its implementation replaced Jean Rich as the center of their world.
Jean Rich had struck a deal with a man known both as a hero and a tireless competitor among the owners of small, so-called unscheduled aviation companies that fly cargo or passengers on ever-changing schedules. George Edward Batchelor, a decorated World War II pilot, created a niche for small independents in the aviation business by purchasing surplus military aircraft and converting them to commercial use as charter planes. He shaped an industry that from its outset has been characterized by low prices, high maintenance costs, grueling hours, and mountains of potential perils. Along the way, he made millions of dollars and shared that wealth as a high-profile community benefactor. (Batchelor is chairman of public television station WPBT-Channel 2, as well as founder of the the Batchelor Foundation, which has financed research at the University of Miami's School of Medicine. He is also a major contributor to the Zoological Society of Florida.)
To expand her airline's passenger capacity, Jean Rich agreed to lease long-distance planes from George Batchelor. In January 1991, the two business rivals signed a joint-venture agreement giving Batchelor's company, International Air Leases, Inc., a majority of the profits his planes earned in addition to the lease payments themselves. In return, Batchelor agreed to cover any operating losses involving his leased planes.
The arrangement would eventually give Batchelor access to Rich's lucrative contracts with the U.S. Air Mobility Command to fly military personnel from base to base. His own charter airline, Arrow Air, had not transported passengers since the military pulled its contract in 1987 following an Arrow crash in Newfoundland that killed nearly 250 servicemen and women. Jean Rich was also backed against the wall. Her own planes did not meet new federal noise-abatement standards. Batchelor's planes met the standards.
But there were also dangers attached to the deal Jean Rich made with George Batchelor. Without a vigilant manager to protect the airline's financial interests, for example, Batchelor could be in a position to suck all the profits out of Rich International Airways. Also the one-to-one relationship could create a type of business codependency, except that the wealthy Batchelor, with his multitude of aviation companies and myriad industry contacts, was clearly the stronger partner. It was the kind of deal, perhaps, that could be successfully managed only by an iron-willed person with a controlling personality and an obsession with detail -- a person such as Jean Rich.
The aviation pioneer signed another critical piece of paper that final year of her life: her last will and testament. Through that document, she created shares in her company and left 40 percent of them to her husband, Bill Meenan, who has replaced her as president. Her four children each received 15 percent of the shares, which gave them a combined 60 percent majority control of Rich International. The will thus created a system of checks and balances between stepfather and children, which Jean Rich hoped would provide stability for both the family and the company.
Instead Linda Harrington and her stepfather Bill Meenan have been in court for nearly four years, battling for control of the airline. Harrington has sued to have company shares properly distributed and to convene a legitimate board of directors. She also wants Meenan removed as executor of her mother's estate and president of the airline.
For his part, Meenan has filed three lawsuits against Harrington and one of her brothers. He has a powerful ally in Batchelor and his legions of attorneys. Together the men have forced Harrington to fight for the most fundamental of legal rights, such as the right to subpoena witnesses. They've flouted court-approved agreements and have tried to force her out of her Islamorada house.
But Harrington has been able to draw on resources Meenan and Batchelor had not anticipated: a network of employees throughout the country who were once loyal to Jean Rich and are now dedicated to her daughter. Those workers have provided Harrington with reams of internal reports and memos that, she asserts, document slipshod management, self-dealing, cronyism, and profligate waste. More grave are allegations in her lawsuits and in correspondence with company attorneys of lapses in basic maintenance and safety procedures and altered maintenance and pilot-training records.
To those charges, Meenan won't respond for this story. But the airline's corporate counsel, Mark Scheer, summed up the company's response in a May 17 letter: "Rich International Airways is extremely proud of the fact that in over 25 years of continuous flight operations, it has never had a major accident and has never had a death or serious injury. Not only are [Harrington's] charges baseless, they are irresponsible."
The Federal Aviation Administration (FAA) lent credence to Harrington's claims of maintenance lapses this past June, when it cited the airline for installing unapproved, foreign parts in eight of ten airplanes in use in March 1995.
Harrington has been bolstered by another resource: her conviction that her mother, the legendary Jean Rich, would not only approve of her quest, but would have taken it on as her own. "The airline was built for her children," Harrington insists. "That was her safety net for her children. She certainly didn't intend for George Batchelor to throw us out in the street."
In a charming 1939 photograph, a handsome man wearing a jaunty captain's hat holds the yoke of a Ford Tri-motor as it climbs over the Andes mountains. His wide grin and relaxed posture convey his joy of flight. The man is Jean Rich's father, David Sanguesa, the family's first aviator. The Spanish Sanguesa married into an aristocratic Peruvian family and migrated to Miami after the birth of Jean, his first daughter. Later he would head the maintenance divisions of several South American and U.S. aviation firms. Daughter Jean followed him into the business while still in high school, first working as a secretary, then becoming a pilot, and finally entering the business side and brokering her first airplane deal before turning 21.
Sanguesa had been a strict father. He sent his three children to Catholic school, and made sure that Jean always had a chaperon for social events. Still, his attractive, wide-eyed daughter had no trouble attracting beaus. One of them, Homer Rich, worked under her father, who was chief inspector of L.B. Smith airlines in Miami. Rich, a pilot recently returned from Korea, boasted Nordic good looks and a talent for fixing airplanes. They married in 1956.
He idolized his Peruvian-born wife, and together they built a small cargo carrier, Florida Caribbean Airways, which later went bankrupt. But the war had scarred him. Family members recall that he drank to forget the faces of the dead. And when he drank, he lashed out. Jean Rich's sister, Jacqueline McGuire, remembers shattered family dinners. "He would go berserk," McGuire says. "He would start screaming and yelling at the top of his lungs. She'd say, 'Rich, I wish you wouldn't drink any more.' He'd get in the car and race around and start beeping the horn and saying, 'Jean, get out here with those kids!' It was abusive -- four-letter words and screaming."
Their daughter Linda remembers a fight that occurred when she was just ten. She, her mother, and her father had picked up burgers and drinks from the Burger King in South Dade when an argument started. From the back seat, Linda looked up when she heard a slap. "He whacked her," she remembers. "I was petrified. I hit him in the back and said, 'Leave my mother alone!' I'll never forget. He had gotten hot coffee and he threw it in the back seat. I got some on my legs."
Jean Rich would endure the fighting for thirteen years. But in 1969 she decided she had had enough and filed for divorce. She then obtained a $10,000 loan and bought a small C-46 prop plane with only 4400 square feet of cargo space, and opened for business as Rich International Airways.
The head of maintenance at Rich was Bill Meenan, a lanky, easygoing Irish American with aviation experience and an appreciation of strong, beautiful women. Jean Rich married him in 1971. Being a wife, however, did not in any way diminish the respect she commanded as chief executive. "Here's Jean running and telling everybody what to do," recalls Laurence Costanzo, a former pilot who is suing the airline for his firing in 1992. "She's this little Napoleon who terrified the heck out of everyone. She had some chutzpah."
Jacqueline McGuire remembers her sister as having always been self-confident, sometimes even self-important, which may explain why her father had nicknamed her "Queen Bee." And McGuire was not surprised that she embraced the tough manner and rough language of the men she dealt with every day. George Batchelor recalls that Jean Rich feared no one -- not him, not other competitors, not even the FAA: "She had no hesitation to pick up the phone and call the president of the United States if she thought she had a problem and she was not getting answers from the bureaucrats."
Audaciousness aside, Rich had bought into an industry ruthlessly unforgiving in its demands. Profits depended on the purchase or lease of older airplanes subject to accelerating repair costs. Scheduling was a nightmare. Planes flew and money was made only if charters were promoted and sold. Winters were always slow. Federal regulators seemed to exist only to create logjams.
Despite its troubles, the airline developed an impressive list of cargo clients -- including recluse Howard Hughes and famed oceanographer Jacques Cousteau. By the early Eighties it had nine planes and had expanded into charter passenger service. Still, its financial trajectory had reached too few highs and too many lows. Shortly after deregulation opened the airline industry to competition, the price of certain cargo planes dropped dramatically, which allowed many of Rich's customers to buy their own planes and ship their own cargo. The market for charter services declined precipitously.
In 1983 the company filed for Chapter 11 bankruptcy protection, listing debts of nearly four million dollars. Jean Rich turned to George Batchelor for help, and he loaned her one million dollars on the condition that it be repaid, with interest, in five years. If she failed, he would assume control of the airline. Rich agreed to pay back every creditor in full, and emerged from Chapter 11 within one year, though it would take several more years to compensate all creditors. Mischievously, her daughter recalls, Rich waited until the absolute last minute to produce the cashier's check to Batchelor. "She hand-delivered it to his office," Harrington says. "She said, 'No f-ing way is George Batchelor getting his hands on my planes.'"
Initially Jean Rich confronted ovarian cancer with the same assertiveness she brought to her work. She called her family together after the disease was diagnosed in August 1991 and told them that doctors had found "a little tumor." Physicians soon removed two tumors during a hysterectomy, but her condition didn't improve. More surgery was planned, and in anticipation of that, she prepared a new will with the help of husband Bill Meenan.
After opening her up a second time, surgeons discovered that her body was riddled with cancer. Though death was imminent, family members withheld the grim news.
Jean Rich died December 20, 1991, at South Miami Hospital, cradled in her daughter's arms. She was 54 years old. Of the family she left, only one child, David, worked at her airline. Linda's only job at the time was caring for her mother. Youngest sons Stephen and Michael worked outside the aviation industry.
Her mother's death had a profound effect on Linda, who, as the eldest child, took it upon herself to assume the role of family leader and protector, a role that only intensified a long-simmering rivalry between her and her brother David. (All three brothers declined to comment for this story.) Further complicating matters, Linda's relationship with her stepfather, Bill Meenan, soon deteriorated.
At the time of her death, Jean Rich's airline owned two DC-8 long-range passenger aircraft and leased other planes, at least one of them from George Batchelor's International Air Leases, Inc. The company had $2.7 million in cash on hand and expected to end the year with $810,000 in profit, according to financial reports and audits by the accounting firm Morten Beyer & Associates. But it also had $2.9 million in long-term debt.
Because of the airline's debts and its erratic past, accountants found little cause for optimism. The company had no stable base of business and faced overwhelming competition from the big carriers. Even major charter airlines had a tough time surviving. "It is fair to say that no established conventional major or regional airline could endure the vicissitudes of fortune that are daily fare at Rich," reads the accountants' report. The company managed to overcome obstacles and expand only because its manager, Jean Rich, was able to respond flexibly and effectively, the report notes, adding that the joint venture with Batchelor was responsible for helping Rich make a profit the year of her death.
On January 13, 1992 -- the late Jean Rich's birthday -- Bill Meenan called a meeting of the family at the offices of Harry K. Bender, his dead wife's personal attorney, for a formal reading of her last will and testament. All four children attended. When they arrived, Linda Harrington recalls, Bill Meenan and the airline's regulatory attorney, Gary Garofalo, were conversing in a conference room. That seemed wrong to Harrington. Why was Garofalo present at the reading of the will?
All assembled around a long table, Garofalo at the head, Linda and two of her three brothers sitting at angles at the other end. For the children, the memory of their mother's last birthday and their first Christmas without her lingered.
Bill Meenan got his 40-percent share in Rich International, the household furniture, the Mercedes Benz, the Jeep Wagoneer, and the Bertram yacht. The children were to receive jewelry and 60 percent of the company. Meenan, named in the will as executor of the estate, was to sell the real property -- a million-dollar home in Gables Estates, a Key Biscayne condominium, and a house in Islamorada -- the proceeds from which were to be put into trust for the four children and one grandchild. Meenan would get an additional $500,000.
After the will was read, Harrington recalls, a courier arrived with copies of documents. A somewhat apologetic Garofalo joked about attorneys and explained that in order for the company to retain its military contracts -- in light of Jean's death -- it had to show continuity of management. In brief, he wanted the children to sign a "voting trust agreement" giving Meenan all voting rights they held as company shareholders. The agreement would expire in five years. According to Harrington, Garofalo told them, "This is what your mother wanted." Three of the four -- the three boys -- signed. Harrington put the document in her briefcase and asked for time to look it over.
She never did sign, and spent the next two years trying to invalidate her brothers' agreements. More than four years after that meeting, Harrington remains so annoyed by the episode that when she speaks of it, she feels compelled to stand up and imitate Garofalo. She waves her hands, slams the table, repeats the phrase that angers her most: "This is what your mother wanted."
Harrington believes that she's the one in a position to know what Jean Rich would have wanted. For one thing, she has inherited her mother's stubbornness. The two women had fought fiercely as the domineering Rich tried to control her daughter's life. Harrington, though, was rebellious from a young age. Against her mother's wishes, she married at eighteen. When she was just 22, she handed her baby girl to her grandmother for frequent short periods, and headed across the country to work with the advance teams for rock and roll bands, including Fleetwood Mac. But in time mother and daughter reconciled completely. Harrington keeps boxes of letters from her mother; on birthdays they wrote each other sentimental notes; Harrington herself wrote poems for her mother. Photos show the two huddled together at parties.
The daughter's involvement with Rich International Airways has become a disputed matter. Harrington says she ran the airline's cargo department for several years before heading to England with her second husband, Colin Harrington, a British business consultant. When she returned in 1989, she says, her mother gave her a job and a title, director of marketing. But Bill Meenan's lawyer, Mark Scheer, claims Harrington hadn't worked at the airline for at least a year before her mother died.
Since Jean Rich's death, Harrington has not been employed. Instead she has worked continuously to substantiate the charges made in her lawsuits. As she talks about the subject, her words come slowly and deliberately. She has dissected the company's day-to-day activities, studied volumes of maintenance logs, and knows who her stepfather meets with and when. But as she recites this litany, her voice breaks in anger. She loses her train of thought, repeats phrases, and recites something akin to a mantra: "I'm Jean Rich's daughter first and foremost."
Though Meenan's people are quick to say "she's no Jean Rich," they may underestimate her. Harrington fights on, despite being repeatedly frustrated in court. She had to defend herself against foreclosure proceedings to hold on to the Islamorada house she's worked so hard to transform. A three-year effort to buy her stepfather's shares in the airline fell flat. Meenan and Batchelor even stymied her attempts to bring independent management to the firm. But she simply will not quit.
In December 1992, a year following Jean Rich's death, Harrington filed suit in probate court charging that Bill Meenan tripled his salary through deceit, that he failed to transfer to the children their shares of the company, and that he took advantage of the boys' grief by having them sign away their rights on their dead mother's birthday. (Meenan's attorney counters that, had the children been given their shares when they demanded them, Meenan would have been saddled with tax debt.)
Harrington and her attorney eventually got what she wanted. Under a settlement recorded June 21, 1993, Meenan withdrew the "voting trust agreements." He also agreed to give the children more say in the corporate management by allowing them to appoint two members to the board of directors. (The other side would appoint two members and the probate judge would appoint a fifth.) Also under the settlement, the children were to receive a monthly salary and a consulting job that would allow them to earn it. Meenan got to keep most of his increased salary -- $175,000.
About six months after that settlement, George Batchelor dramatically altered the equation when he purchased David Rich's shares of the airline. The price: $600,000. Jean Rich's children no longer owned a controlling interest in the airline. Why her son decided to sell his inheritance to Batchelor remains a mystery (neither man will comment), though Harrington saw it as a personal affront.
Harrington's effort to create a board of directors that Meenan and Batchelor didn't dominate also came to naught. The men tried to block the appointment of a fifth director, and when he was finally appointed, they trampled the settlement agreement by meeting privately and changing the company's bylaws so that Harrington, her brother Stephen, and the fifth director could not hold an official meeting without Meenan or a Batchelor proxy in attendance. The two men then simply refused to attend board meetings in Harrington's presence.
Her lawyer, Scott Silver, demanded that the probate judge enforce the settlement and strike the altered bylaws. But Judge Robert Newman, who had never acted decisively in the case, referred the matter to a "special master" who conducted a 30-hour hearing. The recommendation: Judge Newman should grant nearly all of Silver's demands. Meenan and Batchelor successfully appealed the appointment of a special master and forced the case back to Newman's court. But it did not stay there long.
Judge Newman tossed the dispute over to civil court, reasoning that it now involved arguments over company management, not disagreements about a will. Linda Harrington has been forced to start over in a new setting with a new judge, and that has given Meenan and Batchelor a new theater for combat. The two men have fought Harrington in other courtrooms as well. Meenan sued to foreclose on her house only months after she bought it from the estate. That suit was dismissed. The stepfather also has sued his stepson Stephen for a $10,000 debt; the suit is pending. Batchelor has sued to acquire the voting rights that Rich's children enjoy, and Meenan has sued to undo restrictions Jean Rich placed in her will that prohibit him from selling his shares of the company to anyone but her children.
The building that has housed Rich International Airways since its founding is soon to be bulldozed to make way for airport expansion, and the company has already moved on, having relocated most of its operations to an office building at NW 36th Street and 63rd Avenue. Rich International's cheery new newsletter, Charter Chatter, hails the move as a symbol of the airline's ability to overcome obstacles.
And indeed the airline has much to boast about. Since Jean Rich's death, revenues have grown enormously, from $25 million at the end of 1991 to more than $150 million by the end of 1995. It has no long-term debt. Its fleet of leased and owned airplanes has increased to twenty. And today it is the second-busiest charter service flying out of Miami International Airport, having carried 19,307 passengers in 1995.
But profits have not kept pace with revenues. Jean Rich reported an $810,000 after-tax profit on $25 million in revenues in 1991. But under Bill Meenan, despite earning twice and three times the revenue from 1993 to 1994, profits only slightly increased. For example, the airline reported only $1.07 million in after-tax profits in 1993 on $98 million in revenues.
In 1995 the airline's losses were colossal, totalling about $936,000, though revenues had soared to $150 million. Rich's general counsel, Mark Scheer, says that Meenan's business philosophy is to reinvest the profits in the company. But Linda Harrington alleges she's found plenty of examples of waste and poor management that explain the losses.
Harrington also alleges that the company has adopted questionable maintenance routines inherited from Batchelor, whose own charter airline, Arrow Air, has been shut down three times in response to the FAA's safety concerns. Most recently, in May 1995, Arrow agreed to shut down after an FAA investigation found that the airline had used unapproved foreign parts on some of its planes. The agency pulled the airline's certification, demanded a $1.5 million payment for its costs, and eventually recertified it after it fired five employees and re-established safety procedures.
Shortly after the FAA threatened to pull Arrow's operating certificate, however, Rich International also admitted, in a March 1995 letter to the agency, that it, too, had used unapproved parts on some of its planes. The matter languished for more than a year. Then this past May, after a ValuJet craft crashed in the Everglades, public outcry pressured the FAA to increase its scrutiny of low-cost air services. A month later FAA officials made an unusual public announcement of its intention to fine Rich International some $2.6 million. The charge: Airline employees had installed 75 unapproved parts from foreign planes on six of the L1011 aircraft it leases from Batchelor. Those six planes were not considered airworthy when flying "hundreds" of flights between March 1993 and March 1995, according to FAA documents. (The company will have an opportunity to contest both the fine and the investigative findings that prompted it.)
"By allowing Batchelor to supply Rich with planes, parts, and equipment through his various entities, Meenan has put Rich at risk of FAA action," Harrington charged in her April 1995 lawsuit against Meenan. Given the similarity between Arrow's and Rich's FAA record, Harrington's charge now seems almost prophetic.
Harrington says she's not done yet. After complaining over the years about alleged maintenance gaps and safety risks, she gave Meenan an ultimatum in a letter this past May: Investigate and solve the problems, or she'll go to the authorities.
Scheer answered with threats of his own, calling her warning a "self-serving" tirade and an attempt to "manipulate the affairs of the company for her own benefit."
Harrington shot back a letter to Scheer reiterating her threat: "I will wait no longer than 5:00 p.m. on Friday, the 17th of May, 1996, before passing all in my possession to the appropriate authorities."
Today Harrington says she's aware that federal regulators are investigating Rich International Airways, but she will not comment further. The investigation could shut down the airline and Harrington knows it. But she pushes on, hoping to oust Meenan and replace him with what she considers more professional management. And she continues to repeat her mantra: "I am Jean Rich's daughter, first and foremost.
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