In early
1997, Elie Katz called me into his office one morning. He was uncharacteristically serious with me,
so I knew something was up. It was the
first time he discussed his health problems with me in detail. He wanted to know if I would take over
running the Registry so he could retire.
I gave him
an answer on the spot – NO. I told him
that I would not be very good at doing what he did. I’ve never thought I’d make a very good salesman, which was in
large part what Elie did. I excelled at
technical work. I was very good at
working with computers, but probably not so good at dealing with people. In short, I told Elie I was the wrong man
for the job; His job!
I was
being totally honest with Elie. I had
little interest in doing his job, and I thought I would not be very good at
it. I also thought the Registry needed
someone more qualified for the CEO position than I was. He never approached me about the job
again. In retrospect, maybe I should
have said yes. Elie eventually found
another person to take over as CEO, but quite honestly, I believe I could have
done a much better job than this fellow did at running the Registry. Elie’s replacement was our CEO, at least in
title, for almost three years.
Most of the Registry’s revenue came directly from the National Marrow Donor Program. I believe it was in mid-1997 that we were told that the NMDP was going to change the funding structure it followed when paying it’s member registries for their services. I suspect this was in response to cutbacks that the NMDP was experiencing in the funding they received from the government, and an attempt at cost-containment. Under this new “fee-for-services” model, the Registry would, we were told, see a much lower level of funding from the NMDP. We were told to prepare for leaner times ahead.
At about
the same time, Elie Katz was in declining health and was seeking an outside
organization to assume control of the Registry after he stepped down from the
day to day management of the Registry.
Just before he stepped down at the end of
1997, Elie Katz let several staff members go.
One of them was a computer programmer that assisted me. While we were told that trimming the payroll
was a necessary step to take, some of
the employees expressed their anger that the layoffs were not based on
seniority (ie: last hired, first fired).
Rather, it seemed to some of us that the people who lost their jobs were
chosen based on Elie’s personal opinion of the employees. Some employees said they thought that the
funding cutback was a convenient excuse for Elie to get rid of certain
employees.
I was
particularly sorry to see one of my co-workers, M.M., loose her job at the end
of 1997. She was one of the nicest,
sweetest, most pleasant people you would ever want to meet. Completely unpretentious, and down-to-earth. Not a mean bone in her body. Unlike many of the other employees who were
always rushing out of the office at quitting time, M.M. always found time to
stop and chat. She would be one of the
first people there in the morning, and one of the last to leave each day. She is truly a friend, and I continue to
speak with her from time to time. I
hope she forgives me for saying this, but because of her age, I was terribly
concerned that she would have a difficult time finding other employment. Thankfully, she did find a new job, and she
is still working. The breadth of her
knowledge and interests is quite amazing.
We would talk about everything, from computers to pets to automobile
repair. She is a rare find, and I wish
her well. If there’s one person I will
never forgive Elie Katz for saying nasty things about, it is she.
Elie also
gave up a large part of the office space we were leasing. This impacted me directly, as I lost the
office I shared with the programmer that was let go. We no longer had a conference room or several other offices
either. We were now operating out of a
much smaller office. From that point
on, I worked out of a cubicle I fashioned out of a corner of the office space
that remained. I guess I was a bit
upset that some of the remaining offices were given to relatively new employees
while I ended up being a sort of refugee.
Elie also
closed the satellite offices in Buffalo, NY, Philadelphia, PA and Boston, MA,
at about the same time, although two of the employees at those offices
continued to work for the Registry. One
of these employees, L.P.D., worked out of her home, and I believe the other
employee, S.R., worked for us on occasion, as needed for donor drives, etc.
By 1997,
Elie had been in declining health for some time. That, and his advancing age was making it impossible for him to
remain in day-to-day control of the Registry.
I guess it was logical for him to turn to a local medical center when
seeking a suitor who could take over management of the Registry. We had an existing relationship with St. Joseph’s Hospital
and Medical Center in Paterson, New Jersey. Paterson (in Passaic County) is a few towns away from River Edge
(Bergen County). The physician who ran
St. Joseph’s Hematology and Oncology department, A.R., was on Elie’s Board of
Directors, and was also on our payroll, serving as the Registry’s medical
director. We would send our potential
marrow donors to St. Josephs for physical examinations (“workups”) and in some
cases, for the harvesting of their marrow, if they reached that point in the
donation process.
Elie signed an agreement with St.
Joseph’s in late 1997 that had them taking control of the Registry. In legal terms, the agreement was embodied
in a “Memorandum of Understanding” that was put together by attorneys for both
organizations. You know, I’ve always
wondered why lawyers are the butt of so many jokes. Now I know why (more on this later).
For
Elie’s replacement, the administrator of St. Joe’s at that time, J.F.B., a
Catholic Nun, had recommended a hospital administrator she knew named I.S. He most recently had held an administrative
position at a hospital in Camden, New Jersey.
Elie retired as C.E.O. of the Registry and turned the day-to-day
responsibilities of running the Registry, including the title of C.E.O. over to
I.S. as of the end of 1997. Elie
however, retained the title of President, which left him in effective, if not
absentee control of the Registry. It
was not clear to me at the time why Elie wanted to retain control. Given his health, it was unlikely that he
would ever be able to return to his former position of running the day-to-day
business of the Registry. After I.S.
took over day-to-day control of the Registry, there were instances when I would
remind my co-workers that Elie was still in ultimate control, and that I.S.
reported to Elie. My co-workers by and
large, didn’t believe that Elie was still calling the shots behind the scene,
but I was ultimately proven correct in this regard.
I
believe putting I.S. in charge was a big mistake. I’ll be even less generous….
In my view, next to our merger with the Bergen Community Regional Blood
Center, he was the worst thing that ever happened to the HLA Registry
Foundation, and Elie knew it pretty early on. I.S. was our C.E.O. for almost three years. It appeared to me that I.S. had three
priorities in life. They were playing golf, following his investments in the
stock market, and dieting. But try to
talk to him about an important decision that had to be made regarding the
Registry, and he didn’t want to get involved.
Other managers and staff saw the same thing in I.S. that I did; we could
not get him to make any decisions. I’m
not sure if he was afraid of making the wrong decision, or if it was an extreme
case of empowering his managers. It
was scary, because here was a boss that nobody felt comfortable bringing
important issues to. He had the
authority to fire you for decisions that you made. You felt a responsibility to try and involve him in things that
were taking place and decisions that had to be made. I resented the situation, and it concerned me. I seriously considered a mutiny, but given
the standard penalty for mutiny, I never acted. Besides, other than what I viewed as his shortcomings as an
executive, I.S. was, in contrast to Elie Katz, a soft-spoken, easygoing
fellow. On a human level, most of us
liked him. Besides, he didn’t scream
like Elie did.
During these three years it seemed, there was zero involvement in the operation of the Registry by the people at St. Joes, with a single exception; When the agreement was signed at the end of 1997, half of our Board members resigned and their seats were filled by individuals from St. Joes. Other than their representation on our Board, there was no apparent involvement, interaction or day-to-day contact between the Registry and people from the hospital, other than our referring potential donors for medical workups there. This was not what Elie had in mind when he signed the agreement with St. Joes. Perhaps there’s more to this story than meets the eye. Perhaps the people at St. Joes did not care to fight with Elie over details of running the Registry, and were just biding their time until Elie was gone from the scene. Who knows. But whether to the casual observer, or to the employees of the Registry, there was absolutely nothing to indicate that St. Joes was taking an active role in running the Registry. In the three years that I.S. was in charge, our bank account was dwindling, recruitment of donors was way down, and I guess Elie had been getting an earful from both employees and others, about what I.S. was (or was not) doing. Poor health or not, in late 2000, Elie tore up the agreement with St. Joes and eliminated (ostensibly by action of the Board) the position of C.E.O., eliminating I.S.’s job, and providing a severance package for I.S.. Elie chose to get rid of I.S. by eliminating the CEO position (and providing severance) rather than fire him due to his performance. This was because Elie was advised by his attorney that because of I.S.’s age (around 60) firing him could result in an age-discrimination lawsuit against the Registry. To my knowledge, St. Joe’s did not oppose the dissolution of their memorandum of understanding with us. Perhaps they were just glad to wash their hands of us. I simply don’t know what their position was, or whether they really cared to continue the “relationship” or not.
Whatever your feelings about him, there is one undisputable fact. Elie Katz was a shrewd (and successful) businessman. That’s why he was able to build the Registry and keep it’s finances sound. At the time he signed the agreement with St. Joes, the Registry’s cash-on-hand was several million dollars. However, what he decided to do with that money surprised me. He formed a new non-profit foundation he called “The National HLA Fund” which was based out of his home. He obtained IRS 501(c)(3) tax exempt status for the new entity, and transferred the bulk of the Registry’s funds (several million dollars) to the new Foundation. If you’re thinking that was illegal, think again. Elie worked closely with his attorney to make sure everything was done legally. As far as I know, the IRS never questioned the transfer. Elie’s Board of Directors approved it. I never approved it (nobody asked me).
He told me his new Foundation was set up to help families with a child needing a marrow transplant to pay for the cost of testing potential donors. I’m sure what he did was legal. I’m not so sure it was morally correct. After all, whether those dollars came from a corporation or a family that made a donation to the Registry, or from funding received from the NMDP, in my mind, there was an obligation to see that those funds were used to further the mission of the Registry. Perhaps I’m wrong about this issue, but that is what I believe. I can understand Elie’s desire to retain control over the funds he amassed while running the Registry, but I question his methods.
Over the
next few years, I asked Elie several times about what his new Foundation was
doing, but regretfully, he was never forthcoming with any specifics. I guess he felt it was none of my
business. Perhaps he was right. I tend to be very curious. Some people think I ask too many questions.
In the
years after Elie Katz left the day-to-day operation of the Registry and started
his National HLA Fund, another 501(c)(3) private foundation, I asked him many
times about what he was accomplishing.
Despite the fact that he occasionally asked me to help him with minor
computer issues for the office he had in his home, he never cared to discuss
with me the work that the Fund was doing, only speaking in generalities and
painting a positive picture. After Elie
died, I was sure I’d get the answers by looking at his organization’s tax
returns and by searching the Web. I was
pretty certain that all the money he moved from the Registry to his new venture
must have allowed him to help many, many families.
Here’s an excerpt from a description of the National HLA Fund’s mission, which I took off of the website (no longer existing) which Elie had set up for that organization…
“The National HLA Fund is a private, nonprofit
501(c)(3) organization which offers modest financial grants to eligible
individuals to help offset the cost of tissue typing of siblings for the
purpose of identifying a compatible donor in the family for that particular
patient.”
Another
excerpt from the same website…
“The National HLA Fund can act as a repository of
funds colleted [sic] in fund drives – safeguarding these monies and assuring
fiscal responsibility.”
I searched for clues as to where the
funds Elie transferred to his National HLA Fund might have gone, and who might
have benefited from his organization.
Here is what I have found to date:
Based on
Web searches (and confirmed by examination of tax returns, below)…
A donation to the Meland Foundation
(amount and date not disclosed), a New Jersey based organization with the
following objectives stated on their website’s mission statement:
“The Foundation seeks to identify and understand the hazards and adverse
factors affecting the Families of America and each family member. We are concerned about the incidence of
violence in America; drug abuse; and academic failure. We are concerned about
the many indications that families and family members are not flourishing and
are not reaching their highest potential from a physical, intellectual, and
psychological point of view. As we gain
more insight into the causes of these failures and more understanding into the
dynamics of individual and family life, we will respond with concrete programs
to promote greater individual and family well being”.
That sounds awfully broad, but
certainly seems like a noble mission. I
can’t figure out what in the world it has to do with providing financial
support to families searching for bone marrow donors for their child. Can you?
The Meland Foundation’s activities
appear to consist of providing health information to the public through two
libraries. Their website lists them as
the Closter Public Library, in Closter, NJ, and The Englewood Hospital’s
library in Englewood, NJ. The only
address I could find for the Meland Foundation was a Post Office box in
Harrington Park, NJ.
A donation of between five and ten
thousand dollars to the Annapolis, Maryland based Aplastic Anemia and MDS
International Foundation, which was listed in their Winter, 2000 newsletter.
This seems to be an organization that is a bit closer in focus to Elie’s
Fund than the last benefactor I listed, so I think we’re getting warmer, but I
don’t know if this Foundation provides assistance to families with a child that
needs a bone marrow transplant.
A fund raising commitment of
$10,000 to the Marrow Foundation, for an “80 Gun Salute” (a black-tie dinner)
to Admiral Zumwalt
(posthumously) on November 29, 2000 at “Windows On The World”, at the World
Trade Center in New York City. Very
nice. I’m sure everyone had a wonderful
time, although I never received MY invitation.
Considering that the World Trade Center was destroyed nine months later,
on September 11, 2001, I guess the Dinner was held just in time. I’m not making light of the tragedy, but
rather I’m simply pointing out the timing.
Despite living in New York City when it was built, and in New Jersey for
most of it’s existence, I had never visited the World Trade Center. Carpe Diem.
The website of the Marrow Foundation,
based in Washington, DC, states the following:
“The Marrow Foundation is a partner of the National Marrow Donor Program®
(NMDP) that secures resources from the private sector to carry out the work of
the NMDP”. That is very important work
which I support wholeheartedly, but does it further the stated mission of the
National HLA Fund?
Here’s an interesting question that
popped up while I was visiting The Marrow Foundation’s website. I do not intend to imply there is anything
wrong with the practice. I simply don’t
understand the reasoning or the purpose.
The Marrow Foundation (TMF) was created to support the work of the
National Marrow Donor Program (NMDP).
On TMF’s website, they list the NMDP as providing a support commitment
of at least $200,000 for the Admiral Zumwalt dinner I just mentioned. I understand the NMDP’s desire to honor
Admiral Zumwalt and what he accomplished.
I support the mission of these fine organizations, but it seems like the
money is going in circles. Why donate
money to a Foundation that exists to raise money for you? Could somebody please explain this to
me?
As I indicated earlier, I obtained the
Private Foundation Tax Returns (IRS Form 990-PF) for the National HLA Fund, for
tax years 1997 thru 2001. Here is a summary
of their grant activities for those years, as reported to the IRS. I have rounded all amounts greater than
$1,000 to the nearest thousand.
Tax year 1997 (period ending 6/30/1998)
– 6 grants
“Miscellaneous” $
415
St.
Vincent Medical Canter (no address) $
1,000
B’nai
Brith (Washington, DC) $
3,000
NJ
Camp for Blind Children (Marcella, NJ) **see LIONS $ 5,000
NJ
HLA Registry Foundation (River Edge, NJ) $
63,000
Community
Blood Services (Paramus, NJ) $
105,000
Tax year 1998 (period ending 6/30/1999)
– 18 grants
Coalition
For The Homeless (no address) $
100
St.
Josephs School For The Blind (Jersey City, NJ) $
100
Holy
Name Hospital (Teaneck, NJ) $
150
Oradell
Fire Department (Oradell, NJ) $
200
LabCorp
(Burlington, NJ)
$ 280
Oradell Lions Club (Oradell, NJ) **see
LIONS $ 305
Lions
Charitable Foundation (Leonia, NJ) **see LIONS $
550
Special
Olympics (Princeton, NJ) $
675
AAKP
**see KIDNEY, below (Tampa, FL) $
1,000
NJ
Camp For Blind Children (Marcella, NJ) **see LIONS $ 1,000
Doris
Cohen – Living Expenses (Bet Shemesh, Israel) $
2,000
Borough
of Oradell – Police Equipment (Oradell, NJ) $
2,000
Charlie
Chiarello – Renovations for disability (Oradell, NJ) $ 8,000
Doctors
Without Borders (New York, NY) $
10,000
The
Marrow Foundation (Washington, DC) $
14,000
New
York University Medical Center (New York, NY) $
50,000
Camp
Kinderland – Playhouse renovation (Brooklyn, NY) $ 100,000
Community
Blood Services (Paramus, NJ) $
177,000
Tax year 1999 (period ending 6/30/2000)
– 18 grants
St.
Josephs School For The Blind (Jersey City, NJ) $
40
Coalition
For The Homeless (no address) $
100
Oradell
Fire Department (Oradell, NJ) $
100
“Miscellaneous” $
197
Lions
Charitable Foundation **see LIONS (Leonia, NJ) $
450
AAKP
**see KIDNEY (Tampa, FL) $
500
Lions
Eye Bank Of New Jersey **see LIONS (Springfield, NJ) $ 1,000
Doris
Cohen – Living Expenses (Bet Shemesh, Israel) $
1,000
Community
Blood Services (Paramus, NJ) $
1,000
Bergen
Community Regional Blood Center (Paramus, NJ) $
2,000
The
Meland Foundation – Children’s books (Harrington Park, NJ) $ 2,000
National Kidney Foundation (New York,
NY) $
2,000
Doctors Without Borders (New York, NY) $ 2,000
LabCorp
(Burlington, NJ) $
3,000
Oradell
Lions Club **see LIONS (Oradell, NJ) $
5,000
Aplastic
Anemia Foundation (Annapolis, MD) $
16,000
NJ
Camp For Blind Children **see LIONS (Marcella, NJ) $ 17,000
The
Marrow Foundation (Washington, DC) $
27,000
Tax year 1999 (period ending 6/30/2000)
– 12 grants
Lions
Charitable Foundation **see LIONS (Leonia, NJ) $
100
AAKP
**see KIDNEY (Tampa, FL) $
150
Oradell
Lions Club **see LIONS (Oradell, NJ) $
155
Coalition
For The Homeless (no address) $
200
Doris
Cohen – Living Expenses (Bet Shemesh, Israel) $
700
National
Kidney Foundation (New York, NY) $
450
“Miscellaneous” $
460
The
Meland Foundation – Children’s Books (Harrington Park, NJ) $ 1,000
LabCorp
(Burlington, NJ) $
3,000
NJ
Camp For The Blind **see LIONS (Marcella, NJ) $
5,000
Community
Blood Services (Paramus, NJ) $
6,000
The
Marrow Foundation (Washington, DC) $
30,000
Tax year 2000 (period ending 6/30/2001)
– 12 grants
National
Kidney Foundation (New York, NY) $
50
Lions
Charitable Foundation **see LIONS (Leonia, NJ) $
100
AAKP
**see KIDNEY (Tampa, FL) $
100
The Meland Foundation – Children’s
Books (Harrington Park, NJ) $ 100
St. Josephs School For The Blind (Jersey
City, NJ) $ 150
Oradell
Lions Club **see LIONS (Oradell, NJ) $
200
Coalition
For The Homeless (no address) $
200
Oradell Fire Department (Oradell, NJ) $ 250
“Miscellaneous” $
585
NJ Camp For The Blind **see LIONS (Marcella,
NJ) $ 10,000
The Marrow Foundation (Washington, DC) $ 16,000
Bergen
Community Regional Blood Center (Paramus, NJ) $
32,000
** LIONS – Elie Katz had been a member of the
Oradell, NJ Lions Club for many years.
The camp in Marcella, NJ is supported by the Lions Club.
**
KIDNEY – Although not listed on the tax return, “AAKP” appears to be the
American
Association of Kidney
Patients, which would have been a cause pertinent
to Elie Katz’s personal
life.
A
review of these grants gives a feel for Elie Katz’s interests. Certainly, the biggest recipient of his
largess by far was the Bergen Community Regional Blood Center, aka Community
Blood Services, receiving grants totaling nearly a third of a million
dollars. It’s little wonder why they
named one of their programs in his honor.
The National Marrow Donor Program, via The Marrow Foundation, was also a
top recipient. The Lions Club and the
programs they supported were also among Elie’s favorite causes. I have no idea why a Jewish day camp in
Brooklyn, NY, was the beneficiary of such a generous gift for a playhouse (actually,
it appears that the Brooklyn address is probably their office, with the camp
itself being located in Massachusetts).
I thought that the Israeli woman who received several grants for living
expenses, and the Oradell man who received a grant for home renovations were
interesting ones. I was not able to
identify any families who might have received support to assist them in testing
family members for HLA compatibility with a child needing a bone marrow transplant. Perhaps the few dollars listed as
“miscellaneous” or as “LabCorp” went towards paying for testing of family
members, although the dollar amounts are insignificant when compared to the
other grants. That was the supposed reason for Elie creating the Fund, at least
according to what I and my co-workers at the HLA Registry Foundation were told.
It
is interesting to note that for a number of the tax years for which I obtained
tax returns, the National HLA Fund’s operating expenses (excluding grants) far
outstripped the grants they were making, with operating expenses, including
salaries, being more than twice as much as their grant activity. For one year, even M.K.’s compensation alone
had exceeded the grants they made. I
think any watchdog agency that oversees the operation of charitable organizations
would have a problem with that.
At the end
of tax year 2001 (June, 2002), the remaining assets of the National HLA Fund
were $450,000. I did not obtain the tax
returns for subsequent years, so I do not know the disposition of those funds. Elie
Katz died in August of 2003.
If I locate other recipients of grants
from Elie Katz’s National HLA Fund, I will include that information here. If you received a grant or know someone who
did, please let me know about it. I
would like to include the information here.
Until
2001, the President of the United States earned $200,000 a year. The president has a real tough job, and I
think most Americans would agree that he earns his salary. Until 1998, as reported on the Registry’s
IRS filings, Elie Katz was taking home $150,000 a year. When the Registry was dissolved, he took
another $300,000 as a severance package.
When he started the National HLA Fund, which was run out of his home,
his wife M.K. had the title of President of that organization. She was eventually paid a six-figure salary
by that non-profit, according to documents they filed with the IRS. While I’m not certain, I don’t think there
were any employees at Elie’s HLA Fund, other than M.K. herself! I will leave it to the reader to decide if
those salaries were warranted, based on the size of the organizations, the
number of employees and the work done by the individuals. If you were solicited for a donation by the
Registry or the National HLA Fund, and you wrote out a check to help support
their work, would you be comfortable with those salaries? How much do you earn? Having trouble making ends meet? Maybe you should start your own non-profit
organization. It pays very well, at
least for those at the top. Maybe the term
“non-profit” is misleading.
Personally,
I thought those salaries were excessive.
That is, until I saw the tax returns filed with the IRS by the Bergen
Community Regional Blood Center. I
refer the reader to the Blood Center or the IRS, for an examination of their
latest tax return. Their CEO’s salary
makes Elie Katz look like a welfare case.
I’m guessing that their CEO, D.T., must be extremely qualified and
competent, despite how I was treated.
However, I find it hard to believe that the Board can’t find a very
qualified person who would take the job for much, much less. How can they ask the public to support their
charitable organization by making a donation, and still keep a straight face?
I wonder
if these huge salaries are the norm in the “non-profit” world. What in the world are the Boards of all
these charities thinking? We’re not
talking General Motors or IBM or AT&T here. These are small organizations that are asking the public for
financial support. The HLA Registry had
under 20 employees. I believe the Blood
Center has between 100 and 200 employees.
The National HLA Fund, I believe, had no employees other than Elie’s
wife. It’s perfectly legal for a
non-profit to pay huge salaries, but is it right? You be the judge.
Addendum to Charity Cases (March, 2006)
Well
apparently, greed is alive and well in the USA (not that I had very much
doubt). I just read a Washington Post
article printed in the Newark Star-Ledger (March 5, 2006), that discussed the
severance packages the American Red Cross has been giving to it’s executives.
According to the article, their former Chief Executive, Marsha Evans, who
resigned last December after “loosing the confidence of their Board”, received
a severance package exceeding three-quarters of a million dollars. Not to be outdone, their previous CEO,
Bernadine Healy, who was forced out in 2001, received a severance package of
nearly two million dollars. TWO
MILLION DOLLARS? Most American
workers won’t earn that much in their entire life, yet those are exactly the
people the American Red Cross hopes will support their organization. What type of severance package do they offer
executives whose performance they are pleased with? It certainly makes you wonder what the primary mission of the Red
Cross may be. What did the Better
Business Bureau’s Wise Giving Alliance (www.give.org), which
examines charities, have to say about this?
Their reaction was that Marsha Evans’ severance package “was not
unusual”. Is this country great, or
what?
I don’t
know about you, but after the next hurricane, earthquake or tsunami, when the
American Red Cross begs for donations, you won’t see me rushing to send them my
money. My suggestion is that you give
directly to people affected by a disaster, not to an organization that, in my
opinion, may have lost sight of its mission.
Once again, a good reason why you should be a responsible donor and
check an organization’s track record before you support them with your
hard-earned money. Personally, I think
the Internal Revenue Service should conduct a periodic formal review of each
exempt organization’s continued eligibility for tax-exempt status. The salaries, benefits and other
compensation they provide their directors should be considered, among other
factors, in deciding whether to continue their tax-exempt status. Perhaps that will encourage fiduciary
responsibility by boards of directors.
There
was a web of relationships between the HLA Registry Foundation, St. Josephs
Hospital, and Bergen Community Regional Blood Center, with a handful of people
appearing in management and holding positions on the Boards of each of the
organizations. In addition to running
the HLA Registry Foundation, Elie Katz was on the Board of Directors of the
Bergen Community Regional Blood Center, as was A.R., the physician from St.
Josephs Hospital in Paterson, NJ. Then
there is J.F.B, the former CEO of St. Josephs Hospital, who is on the Board of
Trustees of the Blood Center. As I
mentioned earlier, I.S., who became Elie Katz’s replacement when Elie resigned
as CEO, was recommended for the job by J.F.B.
Also noteworthy is the fact that the Blood Center’s CEO, D.T., who was
an employee of St. Joseph’s Hospital at the time, was on the Board of the HLA
Registry Foundation during the time that we had the agreement in place with the
hospital. If D.T. was still on the HLA
Registry’s Board when the vote was taken on whether the Registry would be taken
over by the Blood Center, I would venture to guess that he would have had to
abstain from voting, because of the conflict of interest.
I guess all this reciprocity existing
between the Boards and the Management of these three organizations isn’t all
that surprising, given the persons involved, the similar interests of the
organizations, and their geographic proximity to one another.
A year
or two before the Registry was taken over by the Blood Center, they named their
new umbilical cord blood (stem cell) program in Elie Katz’s honor. Why?
I’m not certain. Perhaps they
were impressed with the work he had done at the Registry or on their
Board. Perhaps it was an acknowledgment
of donations Elie made from the Registry and his National HLA Fund to the Blood
Center. Perhaps Elie had already
promised them that he would turn over the Registry to them, and this was their
way of saying “Thank You”. The Blood
Center even held a gala Dinner honoring Elie Katz at the Sheraton Crossroads
Hotel in Mahwah, New Jersey.
As far
as I know, no money changed hands when the assets of the Registry were handed
over to the Bergen Community Regional Blood Center. Our Board of Directors resigned, Elie Katz resigned (but not
without getting his final reward). The
Registry was dissolved, the donor files, computers, office equipment, and all
other assets were given away to the Blood Center.
During
his negotiations (thru the attorneys for both sides), Elie attempted to secure
employment contracts from the Blood Center for just three of his
employees. Perhaps he wasn’t
comfortable with their promises of jobs for all of the Registry’s employees. The Blood Center’s CEO, D.T., told Elie that
he was the only Blood Center employee that had an employment contract, and he
refused to provide employment contracts for any of the Registry’s employees. Elie withdrew his demand for employment
contracts, which I believe he would have been able to get, had he
insisted. If they wouldn’t provide
employment guarantees for even a few of the Registry’s employees, Elie should
have told the Blood Center to take a hike.
Instead, what he got written into the agreement wasn’t worth the paper
it was written on. Basically, it said
“We’ll take all of your employees, but we can get rid of any of them at any
time for any reason we deem necessary”.
Elie Katz getting the short end of the stick? Think again.
Another item that was discussed during the merger negotiations was that Elie Katz wanted to be given the remainder of the money that the Registry had in the bank, which amounted to several hundred thousand dollars, upon the transfer of the Registry to the Blood Center. It was to be classified as a severance package. Apparently, D.T. was uncomfortable with this arrangement, and suggested that the Blood Center would have no problem with the Registry’s Board of Directors providing the severance money to Elie before ownership changed hands. That’s exactly what they did. Not bad, Elie. I hope you remembered to send Thank You cards to all the people who donated their hard-earned money to the Registry over the years, believing they were helping to pay for laboratory testing of new marrow donors.
What
were you doing on July 15, 2002? At the
HLA Registry Foundation, we were becoming employees of the Bergen Community
Regional Blood Center. Not to
worry; We were told nothing was going
to change. Some of us might have even
believed that.
Here’s
something to ponder... Most people
don’t die suddenly. Rather, experience
a slow decline that is marked by a string of less significant events. For instance… They gradually grow
weaker. They loose their mobility. Bones break. Memory begins to fail.
Organs deteriorate or fail. They
loose their faculties. They stop
eating. They need oxygen. Often, it is a cascading series of events
that brings death. The little things
that happen are probably just as significant to a patient’s outcome as the
major events, perhaps in the aggregate, even more so. As I previously mentioned, during the downsizing of the Registry
in late 1997, one of the casualties was the loss of my office. In retrospect, this was a real bad
sign. If you loose your office, get
moved into a smaller office, have to start sharing your office, etc., be
concerned. Be very concerned.
Another
concern was one that I expressed to D.D., who was our Bookkeeper turned Chief
Operating Officer (when I.S.’s position as CEO was eliminated) turned Registry
Director upon merging with the Blood Center.
Around the time of the merger, I told
D.D. that when I.S. was our CEO, we did not have anywhere near the same
level of communication and access to him as we did with Elie Katz. I was concerned that we wouldn’t have access
to D.T., the Blood Center’s CEO. I
remember exactly where I was standing when I asked the question, and I remember
D.D’s reply to me verbatim. “He has an open-door policy - He is very
accessible”, I was told. As I soon
learned, nothing could have been further from the truth. Nothing.
Shortly
after the Registry became part of the Blood Center, those of us at the Registry
that had company credit cards were told they were being cancelled, and that
only the CEO had a company credit card.
My credit card was used to buy supplies and services for the Registry,
so I thought it would pose a problem for some of the essentials I would purchase
by credit card. My concern was unnecessary.
Shortly after that, I was told that I now reported to the person at the Blood Center that had roughly the same title as I did at the Registry. Did the Blood Center’s Human Resources department call me in or send me a letter to let me know? No. Did The CEO at the Blood Center give me a call to explain the decision? No. They simply had someone at the Registry pass along the message. I wasn’t a recent hire. I wasn’t a low-level employee. I was a department manager, and I had the most seniority of all the Registry’s employees; I was at the Registry for 16 years. By contrast, the person I was told I now report to at the Blood Center had been hired about one year ago. Even D.T., the Blood Center CEO had only been there for about a year. I asked if I was still the Manager of Information Systems. Nobody knew. However, since it appeared that I wasn’t a Manager any longer, I guess I wasn’t authorized to make purchases any longer either. Why would I need a credit card? See, I was worried needlessly.
If
Management of your company doesn’t see fit to communicate personnel decisions
that will directly affect you in a face-to-face fashion, but rather chooses to
communicate indirectly, whether by a third party, or by a voice mail message,
etc., this is another bad sign. In my
opinion, it also doesn’t say much about the integrity of top management.
For the first few months after the merger, I had little contact with the people at the Blood Center. There were a couple of phone calls, and I visited their building once for a tour, and once for their annual staff meeting.
When I was notified that they were planning some changes involving things like e-mail addresses and our Website, I wrote a memo outlining my concerns. I reminded them that the merger agreement stipulated that the Blood Center was to continue operating the Registry as the “HLA Registry” for a period of at least five years. It appeared to me that their intended changes would result in that identity being lost, at least as far as electronic interaction with the public was concerned. While I never got any feedback to my memo, I suspect that the Management at the Blood Center might have considered me to be a “whistle blower”, based on what soon followed.
Shortly thereafter, I was notified by the Blood Center that they felt that they didn’t need an IT Manager at the Registry. I was told that they decided they could handle the IT support function from their offices, and that they planned on phasing out my position at the Registry.
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