Disclosure (27 page)

I don't feel myself competent to judge the pros and cons on this. I was wondering what your view was.”

“On a sale of the Austin plant?”

“Yes. Apparently there's tentative interest from both Hitachi and Motorola. So it's quite possible that it could be liquidated quickly. I think that's what Meredith has in mind. Has she discussed it with you?”

“No,” Sanders said.

“She probably has a lot of ground to cover, settling in to her new job,” Conley said. He was watching Sanders careful y as he spoke. “What do you think about a sale?”

Sanders said, “I don't see a compel ing reason for it.”

“Apart from cash-flow issues, I think her argument is that manufacturing cel ular phones has become a mature business,” Conley said. “As a technology, it's gone through its exponential growth phase, and it's now approaching a commodity.

The high profits are gone. From now on, there wil be only incremental sales increases, against increasing severe foreign competition. So, telephones aren't likely to represent a major income source in the future. And of course there's the question of whether we should be manufacturing in the States at al . A lot of DigiCom's manufacturing is already offshore.”

“That's al true,” Sanders said. “But it's beside the point. First of al , cel ular phones may be reaching market saturation, but the general field of wireless communications is stil in its infancy. We're going to see more and more wireless office nets and wireless field links in the future. So the market is stil expanding, even if telephony is not. Second, I would argue that wireless is a major part of our company's future interest, and one way to stay competitive is to continue to make products and sel them. That forces you to maintain contact with your customer base, to keep knowledgeable about their future interests. I wouldn't opt out now. If Motorola and Hitachi see a business there, why don't we? Third, I think that we have an obligation-a social obligation, if you wil -to keep high-paying skil ed jobs in the U.S. Other countries don't export good jobs. Why should we?

Each of our offshore manufacturing decisions has been made for a specific reason, and, personal y, I hope we start to move them back here. Because there are many hidden costs in offshore fabrication. But most important of al , even though we are primarily a development unit here making new products-we need manufacturing. If there's anything that the last twenty years has shown us, it's that design and manufacturing are al one process. You start splitting off the design engineers from the manufacturing guys and you'l end up with bad design.

You'l end up with General Motors.”

He paused. There was a brief silence. Sanders hadn't intended to speak so strongly; it just came out. But Conley just nodded thoughtful y. “So you believe sel ing Austin would hurt the development unit.”

“No question about it. In the end, manufacturing is a discipline.”

Conley shifted in his seat. “How do you think Meredith Johnson feels on these issues?”

“I don't know.”

“Because you see, al this raises a related question,” Conley said. “Having to do with executive judgment. To be frank, I've heard some rumblings in the division about her appointment. In terms of whether she real y has a good enough grasp of the issues to run a technical division.”

Sanders spread his hands. “I don't feel I can say anything.”

“I'm not asking you to,” Conley said. “I gather she has Garvin's support.”

“Yes, she does.”

“And that's fine with us. But you know what I'm driving at,” Conley said. “The classic problem in acquisitions is that the acquiring company doesn't real y understand what they are buying, and they kil the goose that lays the golden egg. They don't intend to; but they do. They destroy the very thing they want to acquire. I'm concerned that Conley-White not make a mistake like that.”

“Uh-huh.”

`Just between us. If this issue comes up in the meeting tomorrow, would you take the position you just took?”

“Against Johnson?” Sanders shrugged. “That could be difficult.” He was thinking that he probably wouldn't be at the meeting tomorrow. But he couldn't say that to Conley.

“Wel .” Conley extended his hand. “Thanks for your candor. I appreciate it.” He turned to go. “One last thing. It'd be very helpful if we had a handle on the Twinkle drive problem by tomorrow.”

“I know it,” Sanders said. “Believe me, we're working on it.”

Good.”

Conley turned, and left. Cindy came in. “How are you today?”

Nervous.”

“What do you need me to do?” “Pul the data on the Twinkle drives. I want copies of everything I took Meredith Monday night.” “It's on your desk.” He scooped up a stack of folders. On top was a smal DAT cartridge. “What's this?” “That's your video link with Arthur from Monday.” He shrugged, and dropped it in his briefcase. Cindy said, “Anything else?” “No.” He glanced at his watch. “I'm late.”

“Good luck, Tom,” she said. He thanked her and left the office.

Ariving in morning rush-hour traffic, Sanders realized that the only surprise in his encounter with Conley was how sharp the young lawyer was. As for Meredith, her behavior didn't surprise him at al . For years, Sanders had fought the B-school mentality that she exemplified. After watching these graduates come and go, Sanders had final y concluded that there was a fundamental flaw in their education. They had been trained to believe that they were equipped to manage anything. But there was no such thing as general managerial skil s and tools. In the end, there were only specific problems, involving specific industries and specific workers. To apply general tools to specific problems was to fail. You needed to know the market, you needed to know the customers, you needed to know the limits of manufacturing and the limits of your own creative people. None of that was obvious. Meredith couldn't see that Don Cherry and Mark Lewyn needed a link to manufacturing. Yet time and again, Sanders had been shown a prototype and had asked the one significant question: It looks fine, but can you make it on a production line? Can you build it, reliably and quickly, for a price?

Sometimes they could, and sometimes they couldn't. If you took away that question, you changed the entire organization. And not for the better.

Conley was smart enough to see that. And smart enough to keep his ear to the ground. Sanders wondered how much Conley knew of what he hadn't said in their meeting. Did he also know about the harassment suit? It was certainly possible.

Christ, Meredith wanted to sel Austin. Eddie had been right al along. He considered tel ing him, but he real y couldn't. And in any case, he had more pressing things to worry about. He saw the sign for the Magnuson Mediation Center and turned right. Sanders tugged at the knot on his tie and pul ed into a space in the parking lot.

The Magnuson Mediation Center was located just outside Seattle, on a hil overlooking the city. It consisted of three low buildings arranged around a central courtyard where water splashed in fountains and pools. The entire atmosphere was designed to be peaceful and relaxing, but Sanders was tense when he walked up from the parking lot and found Fernandez pacing.

“You see the paper today?” she said.

“Yeah, I saw it.”

“Don't let it upset you. This is a very bad tactical move on their part,” she said.

“You know Connie Walsh?”

“No.■

“She's a bitch,” Fernandez said briskly. “Very unpleasant and very capable. But I expect Judge Murphy to take a strong position on it in the sessions. Now, this is what I worked out with Phil Blackburn. We'l begin with your version of the events of Monday night. Then Johnson wil tel hers.”

“Wait a minute. Why should I go first?” Sanders said. “If I go first, she'l have the advantage of hearing-”

“You are the one bringing the claim so you are obligated to present your case first. I think it wil be to our advantage,” Fernandez said. “This way Johnson wil testify last, before lunch.” They started toward the center building. “Now, there are just two things you have to remember. First, always tel the truth. No matter what happens, just tel the truth. Exactly as you remember it even if you think it hurts your case. Okay?”

“Okay.”

“Second, don't get mad. Her lawyer wil try to make you angry and trap you. Don't fal for it. If you feel insulted or start to get mad, request a five-minute break to consult with me. You're entitled to that, whenever you want. We'l go outside and cool off. But whatever you do, keep cool, Mr. Sanders.” “Okay.”

“Good.” She swung open the door. “Now let's go do it.”

The mediation room was wood-paneled and spare. He saw a polished wooden table with a pitcher of water and glasses and some notepads; in the corner, a sideboard with coffee and a plate of pastries. Windows opened out on a smal atrium with a fountain. He heard the sound of soft gurgling water.

The DigiCom legal team was already there, ranged along one side of the table.

Phil Blackburn, Meredith Johnson, an attorney named Ben Hel er, and two other grim-faced female attorneys. Each woman had an imposing stack of xeroxed papers before her on the table.

Fernandez introduced herself to Meredith Johnson, and the two women shook hands. Then Ben Hel er shook hands with Sanders. Hel er was a florid, beefy man with silver hair, and a deep voice. Wel connected in Seattle, he reminded Sanders of a politician. Hel er introduced the other women, but Sanders immediately forgot their names.

Meredith said, “Hel o, Tom.”

“Meredith.”

He was struck by how beautiful she looked. She wore a blue suit with a cream-colored blouse. With her glasses and her blond hair pul ed back, she looked like a lovely but studious schoolgirl. Hel er patted her hand reassuringly, as if speaking to Sanders had been a terrible ordeal.

Sanders and Fernandez sat down opposite Johnson and Hel er. Everybody got out papers and notes. Then there was an awkward silence, until Hel er said to Fernandez, “How'd that King Power thing turn out?”

“We were pleased,” Fernandez said.

“They fixed an award yet?”

“Next week, Ben.”

“What are you asking?”

“Two mil ion.”

“Two million?”

“Sexual harassment's serious business, Ben. Awards are going up fast.

Right now the average verdict is over a mil ion dol ars. Especial y when the company behaves that badly.”

At the far end of the room, a door opened and a woman in her mid-fifties entered.

She was brisk and erect, and wore a dark blue suit not very different from Meredith's.

“Good morning,” she said. “I'm Barbara Murphy. Please refer to me as judge Murphy, or Ms. Murphy.” She moved around the room, shaking hands with everyone, then took a seat at the head of the table. She opened her briefcase and took out her notes.

“Let me tel you the ground rules for our sessions here,” Judge Murphy said.

“This is not a court of law, and our proceedings won't be recorded. I encourage everyone to maintain a civil and courteous tone. We're not here to make wild accusations or to fix blame. Our goal is to define the nature of the dispute between the parties, and to determine how best to resolve that dispute.

“I want to remind everyone that the al egations made on both sides are extremely serious and may have legal consequences for al parties. I urge you to treat these sessions confidential y. I particularly caution you against discussing what is said here with any outside person or with the press. l have taken the liberty of speaking privately to Mr. Donadio, the editor of the Post-Intelligencer, about the article that appeared today by Ms. Walsh. I reminded Mr. Donadio that al parties in `Company X' are private individuals and that Ms. Walsh is a paid employee of the paper. The risk of a defamation suit against the P-I is very real. Mr. Donadio seemed to take my point.”

She leaned forward, resting her elbows on the table. “Now then. The parties have agreed that Mr. Sanders wil speak first, and he wil then be questioned by Mr.

Hel er. Ms. Johnson wil speak next, and wil be questioned by Ms. Fernandez. In the interest of time, I alone wil have the right to ask questions during the testimony of the principals, and I wil set limits on the questions of opposing attorneys. I'm open to some discussion, but I ask your cooperation in letting me exercise judgment and keep things moving. Before we begin, does anybody have any questions?”

Nobody did.

“Al right. Then let's get started. Mr. Sanders, why don't you tel us what happened, from your point of view.”

Sanders talked quietly for the next half hour. He began with his meeting with Blackburn, where he learned that Meredith was going to be the new vice president. He reported the conversation with Meredith after her speech, in which she suggested a meeting about the Twinkle drive. He told what happened in the six o'clock meeting in detail.

As he spoke, he realized why Fernandez had insisted he tel this story over and over, the day before. The flow of events came easily to him now; he found that he could talk about penises and vaginas without hesitation. Even so, it was an ordeal. He felt exhausted by the time he described leaving the room and seeing the cleaning woman outside.

He then told about the phone cal to his wife, and the early meeting the next morning, his subsequent conversation with Blackburn, and his decision to press charges.

“'That's about it,” he finished.

Judge Murphy said, “I have some questions before we go on. Mr. Sanders, you mentioned that wine was drunk during the meeting.”