the town dandy / By Hank Sims

Assume the Position

(May 8, 2008)  Well, you can take off the bumper stickers. Maxxam is out of Humboldt. That’s it for Charles Hurwitz . Twenty-two years later, and not a moment too soon, every card has been played. He’s getting up from the table, pockets quite a bit heavier, and moseying off into the Texas sunset. The once-proud Pacific Lumber Co. will soon no longer belong to him.

We kept waiting for Hurwitz’s big sneak comeback maneuver in the Pacific Lumber bankruptcy case, the quick feint that would allow him to hold onto the company, but it never came. And then last week Maxxam announced that it was abandoning all its remaining plans for the company and signing on with Mendocino Redwood Co., which is by now the certain front-runner in the struggle for Pacific Lumber. Mendocino Redwoods apparently achieved this change of heart through giving Maxxam a tiny bit better of an exit deal than they would have gotten otherwise. A few more million here and there, it seems — nothing spectacular.

So with Hurwitz out of the running, there’s two factions left standing. Mendocino Redwood Co. and its partners, Marathon Capital, hope to swallow the Pacific Lumber assets whole and keep the company running more or less as-is, though apparently with a drastically scaled-back rate of cut and a pledge not to cut old growth. They’ve already performed a similar trick with former Georgia Pacific lands in the county to our south, and they believe they can replicate it here. Not coincidentally, the purchase would give Mendocino Redwoods something quite close to a monopoly on the worldwide redwood market.

On the other side are the owners of Pacific Lumber subsidiary Scotia Pacific’s “timber bonds,” first issued nearly a decade ago and carrying a face value of some $730 million. The bondholders want to sell the company’s 200,000 acres of Humboldt County land to the highest bidder. They have no plans for the company mill in Scotia. Their plan has attracted attention from a strange assortment of potential bidders: a billionaire poker champ, Harvard University, the Nature Conservancy. No one’s quite sure how serious any of these parties are.

The question now is whether or not the Mendocino Redwoods plan pays off the bondholders adequately. They have to pay them off at least as much as the lands are worth. How much are the lands worth? That’s the question. Mendocino Redwoods says about $530 million. The bondholders say a lot more. If the judge agrees with the bondholders, Mendocino has to either make up the difference or get out of the way. The case goes forward.

But not without a fond look back. Petrolia resident Ellen Taylor has been indefatigable in promoting her “Hurwitz in Handcuffs” competition, which seeks ballads and doggerel poetry memorializing the day, last year, that Charles Hurwitz was briefly detained by Humboldt County Sheriff’s Office personnel at the Eureka-Arcata Airport (in McKinleyville). Well, we note in the court’s record that Taylor officially extended the hand to Judge Richard Schmidt , who is overseeing the bankruptcy case in Corpus Christi. Taylor asked if Schmidt might like to also judge the “Hurwitz in Handcuffs” competition. He politely declined.

But what’s this in our mailbox? It’s the “Hurwitz in Handcuffs” CD, featuring songs and poetry from a who’s who of Humboldt County All-Stars, including a number affiliated to one degree or another with the Journal. Our Bob Doran’s mom, Jean , kicks things off with a little ditty called “Greed.” There’s frequent poetry contributer David Holper with his contribution, “Ballad of C H Being Handcuffed.” There’s Ryan Hurley , he of the late “Captain Buhne” blog, insouciantly redoing a TV sitcom theme: “Charles Should Be Charged.” Plus: Darryl Cherney , Joe Shermis , Fhyre Phoenix , Julian Lang , David Simpson , Seth Zuckerman and oh so many more.

Look for it in fine local record stores.

1 2 3 NEXT PAGE >SHARE