The Appeal

The Appeal Page 14

Jarry Rinehart took the shuttle to LaGuardia, and from there a private car to the Mercer hotel in SoHo. He checked in, showered, and changed into a heavier wool suit because snow was expected. He picked up a fax at the front desk, then walked eight blocks to a tiny Vietnamese restaurant near the Village, one that had yet to appear in the travel guides. Mr. Trudeau preferred it for discreet meetings. It was empty and he was early, so Barry settled himself onto a bar stool and ordered a drink.

F. Clyde Hardin's cheap class action may have been small news in Mississippi, but it was a far better story in New York. The daily financial publications ran with it, and the battered shares of Krane's common stock took another drubbing.

Mr. Trudeau had spent the day working the phones and yelling at Bobby Ratzlaff. Krane's stock had been trading between $18.00 and $20.00, but the class action knocked it back a few bucks. It closed at $14.50, a new low, and Carl pretended to be upset.

Ratzlaff, who had borrowed a million bucks from his retirement fund, seemed even more depressed.

The lower the better. Carl wanted the stock to fall as far as possible. He'd already lost a billion on paper and he could lose more, because one day it would all come roaring back. Unknown to anyone, except two bankers in Zurich, Carl was already buying Krane's stock through a wonderfully nebulous company in Panama. He was carefully gathering shares in small lots so that his buying would not upset the downward trend.

Five thousand shares on a slow day and twenty thousand on a busy one, but nothing that would draw attention. Fourth-quarter earnings were due soon, and Carl had been cooking the books since Christmas. The stock would continue to slide. Carl would continue to buy.

He sent Ratzlaff away after dark, then returned a few calls. At seven, he crawled into the backseat of his Bentley and Toliver drove him to the Vietnamese place.

Carl had not seen Rinehart since their first meeting in Boca Raton, back in November, three days after the verdict. They did not use regular mail, e-mail, faxes, overnight parcels, landlines, or standard cell phones. Each had a secure smart phone that was linked solely to the other, and once a week, when Carl had the time, he called for an update.

They were led through a bamboo curtain to a dimly lit side room with one table. A waiter brought drinks. Carl was going through the motions of cursing class actions and the lawyers who bring them. "We're down to nosebleeds and skin rashes," he said.

"Every redneck who ever drove by the plant down there is suddenly a plaintiff. No one remembers the good old days when we paid the highest wages in south Mississippi.

Now the lawyers have created a stampede and it's a race to the courthouse."

"It could get worse," Barry said. "We know of another group of lawyers who are rounding up clients. If they file, then their class will be added to the first one. I wouldn't sweat it."

"You wouldn't sweat it? You're not burning cash in legal fees."

"You're going to get it back, Carl. Relax." It was now Carl and Barry, first names and lots of familiarity.

"Relax. Krane closed today at $14.50. If you owned twenty-five million shares, you might find it hard to relax."

"I would be relaxed, and I would be buying."

Carl knocked back his scotch. "You're getting pretty cocky."

"I saw our boy today. He made the rounds in Washington. Nice-looking fella, so clean-cut it's frightening. Smart, good speaker, handles himself well. Everybody was impressed."

"Has he signed on?"

"He will tomorrow. He had lunch with Senator Rudd, and the ole boy knows how to twist arms."

"Myers Rudd," Carl said, shaking his head. "What a fool."

"Indeed, but he can always be bought."

"They can all be bought. I spent over four million last year in Washington. Sprinkled it around like Christmas candy."

"And I'm sure Rudd got his share. You and I know he's a moron, but the people in Mississippi don't. He's the king and they worship him down there. If he wants our boy to run, then the race is on."

Carl squirmed out of his jacket and flung it across a chair. He removed his cuff links, rolled up his sleeves, and, with no one to watch, loosened his tie and slouched in his chair. He sipped his scotch. "Do you know the story about Senator Rudd and the EPA?" he asked, with full knowledge that fewer than five people knew the details.

"No," Barry said, tugging at his own tie.

"Seven, maybe eight years ago, before the lawsuits started, the EPA came to Bowmore and started their mischief. The locals there had been complaining for years, but EPA is not known for swift action. They poked around, ran some tests, became somewhat alarmed, then got pretty agitated. We were watching all this very closely. We had people all over the place. Hell, we have people inside the EPA. Maybe we cut some corners with our waste, I don't know, but the bureaucrats really became aggressive.

They were talking about criminal investigations, calling in the U.S. attorney, bad stuff, but still kept internal. They were on the verge of going public with all sorts of demands-a zillion-dollar cleanup, horrendous fines, maybe even a shutdown. A man named Gabbard was CEO of Krane at the time; he's gone now, but a decent sort who knew how to persuade.

I sent Gabbard to Washington with a blank check. Several blank checks. He got with hour lobbyists and set up a new PAC, another one that supposedly worked to further the interests of chemical and plastics manufacturers. They mapped out a plan, the key to which was getting Senator Rudd on our side. They're scared of him down there, and if he wants the EPA to get lost, then you can forget the EPA. Rudd's been on the Appropriations Committee for a hundred years, and if EPA threatens to buck him, then he simply threatens to cut their funding. It's complicated, but it's also very simple. Plus, this is Mississippi, Rudd's backyard, and he had more contacts and clout than anyone else. So our boys at the new PAC wined and dined Rudd, and he knew exactly what was happening. He's a simpleton, but he's played the game for so long he's written most of the rules."

Platters of shrimp and noodles arrived and were casually ignored. Another round of drinks.

"Rudd finally decided that he needed a million bucks for his campaign account, and we agreed to route it through all the dummy corporations and fronts that you guys use to hide it. Congress has made it legal, but it would otherwise be known as bribery.Then Rudd wanted something else. Turns out he's got this slightly retarded grandson who has some weird fixation on elephants. Kid loves elephants. Got pictures all over his walls. Watches wildlife videos. And so on. And what The Senator would really like is one of those first-class, four-star African safaris so he can take his grandson to see a bunch of elephants. No problem. Then he decides that the entire family would enjoy such a trip, so our lobbyists arrange the damned thing. Twenty-eight people, two private jets, fifteen days in the African bush drinking Dom Perignon, eating lobster and steak, and, of course, gawking at a thousand elephants. The bill was close to three hundred grand and he never had a clue it was paid for by me."

"A bargain."

"An absolute bargain. He buried the EPA and they fled Bowmore. They couldn't touch us. And, as a side benefit, Senator Rudd is now an expert on all issues dealing with Africa. AIDS, genocide, famine, human rights abuses-you name it and he's an expert because he spent two weeks in the Kenyan outback watching wild game from the back of a Land Rover."

They shared a laugh and made the first advance upon the noodles. "Did you ever contact him when the lawsuits started?" Barry asked.

"No. The lawyers took over with a vengeance. I remember one conversation with Gabbard about Rudd, but it was the combined wisdom back then that politics would not mix with the litigation. We were pretty confident. How wrong we were."

They ate for a few minutes, but neither seemed thrilled with the food.

"Our boy's name is Ron Fisk," Barry said as he handed over a large manila envelope.

"Here are the basics. Some photos, a background check, no more than eight pages, at your request."

"Fisk?"

"That's him."

Brianna's mother was in the area, her twice-yearly drop-in, and for such visits Carl insisted that they use the mansion in the Hamptons and leave him alone in the city. Her mother was two years younger than Carl and fancied herself attractive enough to catch his eye. He spent less than an hour a year in her presence, and each time caught himself practically praying that Brianna had a different set of genes. He loathed the woman. The mother of a trophy wife is not automatically a trophy mother-in-law, and she is usually much too enamored with the topic of money. Carl had loathed each of his mothers-in-law. He detested the very notion that he had a mother-in-law in the first place.

So they were gone. The Fifth Avenue penthouse was all his. Brianna had loaded up Sadler MacGregor, the Russian nanny, her assistant, her nutritionist, and a maid or two and headed out in a small caravan to the island, where she could invade their fine home up there and abuse the staff.

Carl stepped from his private elevator, came face-to-face with Abused Imelda, cursed at the sight of her, ignored his valet, dismissed the rest of the staff, and when he was finally alone in the wonderful privacy of his bedroom, he put on his pajamas, a bathrobe, and heavy wool socks. He found a cigar, poured a single malt, and stepped out onto the small terrace overlooking Fifth Avenue and Central Park.

The air was raw and windy, perfect.

Rinehart had cautioned him against fretting the details of the campaign. "You don't want to know everything," he said more than once. "Trust me. This is my profession, and I'm very good at what I do."

But Rinehart had never lost a billion dollars. According to one newspaper article, about Carl no less, only six other men had ever lost a billion dollars in one day.

Barry would never know the humiliation of falling so fast and so hard in this city.

Friends become harder to find. Carl's jokes were not funny. Certain portions of the social circuit seemed to be closed (though he knew this was ever so temporary). Even his wife seemed a bit colder and less fawning. Not to mention the cold shoulders from those who really mattered-the bankers, fund managers, investment gurus, the elite of Wall Street.

As the wind reddened his cheeks, he looked slowly around at the buildings up and down Fifth Avenue. Billionaires everywhere. Did anyone feel sorry for him, or were they delighted at his fall? He knew the answer because he had taken so much delight when others had stumbled.

Keep laughing, boys, he said with a long pull on the malt. Laugh your asses off, because I, Carl Trudeau, now have a new secret weapon. His name is Ron Fisk, a nice, gullible young man purchased (offshore) by me for chump change.

Three blocks to the north, at the top of a building Carl could barely see, was the penthouse of Pete Flint, one of his many enemies. Two weeks earlier, Pete had made the cover of Hedge Fund Reports, dressed in an ill-fitting designer suit. He was obviously gaining weight. The story raved about Pete and his fund and, in particular, a spectacular final quarter last year, thanks almost solely to his shrewd shorting of Krane Chemical. Pete claimed to have made a half-billion dollars on Krane because of his brilliant prediction that the trial would end badly. Carl's name wasn't mentioned; it wasn't necessary. It was common knowledge that he'd lost a billion, and there was Pete Flint claiming to have raked in half of it. The humiliation was beyond painful.

Mr. Flint knew nothing about Mr. Fisk. By the time he heard his name, it would be too late and Carl would have his money back. Plus a lot more.