Rowland sells MacKenzie-Childs

Thursday, May 08, 2008
By Debra J. Groom, Syracuse Post-Standard

MacKenzie-Childs in Aurora is now owned by a private company with offices in Rochester and Manhattan.

Pleasant T. Rowland announced to employees Wednesday that she sold MacKenzie-Childs to Twin Lakes Capital LLC, a private equity firm.

Twin Lakes managing partner Lee Feldman would not divulge the sale price. He did say no changes are planned for adding or laying off employees.

MacKenzie-Childs employs about 175 people - 150 in administration and manufacturing in Aurora and 25 more in retail stores. Feldman said the retail stores will remain open and manufacturing of MacKenzie-Childs' high-end home furnishings and tableware will continue in Aurora.

"I hope they keep it active and the people retain their jobs," said Aurora Mayor Thomas Gunderson. "I would hate for it to be bought up and then moved offshore. It sounds like all good news, but time will tell."

Feldman said he and his partner Howard Cohen formed Twin Lakes Capital two and a half years ago to invest in companies and help them grow. He said they have the same plans for MacKenzie-Childs.

"MacKenzie-Childs is a fantastic brand, making a fantastic high-quality product and a unique product," Feldman said. "MacKenzie-Childs has been doing something different with their design aesthetics and craftsmanship, and we want that to continue to grow."

He said he hopes to "grow the company" in both money earned and products made.

He also said no thought has been given to bringing back company founders Richard and Victoria MacKenzie-Childs.

Rowland, a Wells College alumna, made millions with her company American Girl Dolls. She bought MacKenzie-Childs in 2001 when the company was in bankruptcy. Richard and Victoria MacKenzie-Childs had debt of $15.3 million.

Rowland also sunk millions of dollars into buildings and grounds and product designs at MacKenzie-Childs. She opened the New York City and Palm Beach, Fla., stores.

In June 2007, she read a statement to employees noting she was "in the exploratory phases of a sale," confirming something that had been rumored for several years.

Rowland came to Aurora in 2001 and in addition to buying MacKenzie-Childs, she bought many commercial buildings in Aurora. This caused friction with some Aurora and Ledyard residents.

"MacKenzie-Childs is a unique opportunity that fits our investment strategy," Feldman said. "Pleasant Rowland and her management team have transformed this company and built a celebrated brand with exceptional customer loyalty, and we believe we can add value as MacKenzie-Childs pursues its growth potential."

"We look forward to partnering with Norina Coursey, president of MacKenzie-Childs, and the other talented members of the management team as well as the highly skilled MacKenzie-Childs artisans and designers. We share their vision for growing this prestigious brand," Cohen said.

Court lets Victoria, Richard use their names

Wednesday, April 30, 2008
By Dave Tobin, Syracuse Post-Standard

Pleasant Rowland has failed again in her legal bid to keep Victoria and Richard MacKenzie-Childs from commercially using their names.

This month the U.S. Court of Appeals refused to overrule a lower judge's preliminary injunction that allowed the couple to use of the trademark "Victoria and Richard" and a new logo - a thistle and torch. Rowland had asked the appeals court to throw out the injunction.

Rowland filed a 501-page appeal Jan. 30, after U.S. District Judge Michael A. Telesca directed the complicated trademark infringement case to mediation.

A February mediation session did not produce a settlement.

Rowland, a wealthy alumna of Wells College, bought from bankruptcy in 2001 the Aurora-based home-design company MacKenzie-Childs started by the couple.

The couple kept a low profile for several years after bankruptcy and re-emerged in 2005 with a new company, V&R Emprise LLC.

They now sell jewelry, glass and tableware, rugs, lamps and other home furnishings, through their Web site www.victoria, through retailers and from their former home in King Ferry.

Rowland sued the couple in 2006 to prevent them from commercially using their first or last names, and from using a logo design she says closely resembles one she acquired when she bought the company.

She's No Doll to Craft Couple

Sunday, July 1, 2007
By Richard Johnson, New York Post

July 1, 2007 -- THE billionairess who created the American Girl doll brand, Pleasant Rowland, has been less than pleasant to a pair of artists from her upstate hometown of Aurora. According to court papers obtained by Page Six, Rowland is suing Richard and Victoria Mackenzie-Childs, who founded the Mackenzie-Childs handcrafts store chain, in an attempt to stop them from putting their names on works they produce.

In 2001, the couple filed for bankruptcy and sold Mackenzie-Childs to Rowland for $15 million. Trying to get back on their feet, they began turning out art again and put "Victoria and Richard" on their pottery and home furnishings - causing Rowland to charge trademark infringement.

"She is suing us for using our names," Richard told Page Six. "She is trying to drive us out of business." The couple's lawyer, Paul Marshall, said they're countersuing, claiming Rowland has no rights to their first names. Lawyers for Rowland did not return calls.

Madison entrepreneur and philanthropist Pleasant Rowland

Thursday, June 19, 2007
By Doug Moe, Madison Capital Times

New York state newspapers were reporting last week that Madison entrepreneur and philanthropist Pleasant Rowland is thinking of selling MacKenzie-Childs, the home decor company she purchased out of bankruptcy for $5.5 million in 2001.

In a memo to employees of the company, which is located near the village of Aurora, N.Y., Rowland said she had fielded numerous offers over the years but "rejected all inquiries until I felt confident the company was stabilized with a sound business model and a competent, experienced management team."

Rowland said she issued the statement in response to "the rumor mill in the community" that she said "has so frequently distorted my intentions, words and actions."

Rowland's recent purchases and other activities in Aurora -- where she attended Wells College -- have been closely scrutinized by locals. Some welcomed her revitalization efforts while others have expressed skepticism about her motives.

Finger Lakes company up for sale

Thursday, June 14, 2007
Staff Reports, Rochester Democrat & Chronicle

MacKenzie-Childs Ltd., a pottery and home-furnishings business, in Aurora, Cayuga County, is up for sale.

Pleasant T. Rowland, the owner and chief executive, said in a statement Wednesday that the company, which employs about 250 people, was not closing as was being rumored.

Rowland, the creator of the American Girl doll, had teamed up with Wells College to renovate the college-run Aurora Inn.

The Wells alumna from Wisconsin also purchased properties in Aurora, including two mansions and MacKenzie-Childs.

"As most of you are aware, my philanthropic project in Aurora has been completed and my contract with Wells College has ended," she said, adding that she is now exploring options that include selling the company.

Aurora is on the eastern shore of Cayuga Lake in the Finger Lakes wine country. Wells College, an all-women�s school founded by Wells Fargo founder Henry Wells, is the economic anchor for the village of 600.

Rowland sold the American Girl empire of historical dolls, books and accessories in 1998 to Mattel Inc. for $700 million.

Rowland explores sale of MacKenzie-Childs

Thursday, June 14, 2007
By Dave Tobin, Syracuse Post-Standard

It's true. Pleasant Rowland is thinking about selling her home decor company, MacKenzie-Childs, based near the Cayuga County village of Aurora.

In a statement read to employees Wednesday morning, Rowland said she was "in the exploratory phases of a sale," confirming something that has been rumored for several years.

She gave no details about who the buyer might be or when a sale might take place.

"Over the years, but now with increasing frequency, various individuals have expressed interest in purchasing the company. I rejected all inquires until I felt confident the company was stabilized with a sound business model and a competent, experienced management team," she said in a written statement.

She said that her statement was designed to stem "the rumor mill in the community" (that) "has so frequently distorted my intentions, words and actions."

Rowland purchased MacKenzie-Childs from bankruptcy in 2001. Company founders, Richard and Victoria MacKenzie-Childs, had debt of $15.3 million. Rowland purchased the company and its assets, including designs and trademarks, for $6 million.

She has sunk millions more into buildings and grounds, modified designs and opened retail stores in Palm Beach, Atlanta and New York City.

The company employs 150 in Aurora and 25 more at the retail stores, said Jennifer Ellsworth, vice president of sales and marketing.

Ellsworth said she had no knowledge of prospective buyers.

"The senior management team just got the communication this morning from Pleasant. It's so preliminary, I suppose anything is possible," Ellsworth said.

Rowland is a Wells College alumna who came to Aurora in 2001 bringing with her a whirlwind of changes. Lately, she has been divesting and distancing herself from the community.

The wealthy founder of Pleasant Company - maker of American Girl Dolls - purchased and renovated a number of commercial properties for Wells College and set up a company to manage them. Last year she turned the management of those businesses - the Aurora Inn, as well as the village's only tavern, food market, pizza and ice cream parlors - over to Wells College.

She had even crafted a plan to give the village a new post office, a plan that seems to have fallen through, with the passing of a June 1 groundbreaking deadline and no ground broken.

A few of the changes Rowland brought to Aurora antagonized some members of the community. Some accused her of imposing her will on Aurora with little regard for community input.

Meanwhile, a decision is pending in a trademark infringement lawsuit that Rowland's MacKenzie-Childs initiated in federal court against Richard and Victoria MacKenzie-Childs. Rowland contends they can't use their first or last names in promoting their own products.

Upon learning about Rowland's possible sale of the company, Victoria MacKenzie-Childs said she thought it would be a good thing for the company, a good thing for Rowland.

"If she lets go of it, it would be fresh and new and whatever it was supposed to become," Victoria said. "That would be great."

Copyright 2007 The Post-Standard - All Rights Reserved.

Aurora home decor firm up for sale

Thursday, June 14, 2007
By Shane M. Liebler, The Citizen (Auburn)

MacKenzie-Childs may be for sale.

The Aurora firm specializing in home decor issued a press release Wednesday...

�I am going to begin to explore a number of options for the future, among them discussions with people who are interested in buying the company,� Rowland wrote.

Vice President of Sales and Marketing Jennifer Ellsworth said no active conversations are taking place and there is no time frame on the possible sale.

�It's definitely exploratory at this point, so we don't have a good sense of timing ourselves,� Ellsworth said.

She could not speculate what the impact on the company's 150 employees in Aurora would be. The press release emphasized Rowland has no plans to close the facility.

�She would certainly like it to stay in Aurora,� Ellsworth said, referring to Rowland....

Mayor Thomas Gunderson took the news with a little uneasiness when reached for comment. He recalled the fears before Rowland bought the company that a buyer would take the MacKenzie-Childs name and leave town.

�There were a lot of people that probably would have lost their jobs had she not stepped in when she did,� Gunderson said, noting the company's significance as an employer and tourism draw for the village.

MacKenzie-Childs court battles aren't over yet

Thursday, March 22, 2007
By Dave Tobin, Syracuse Post-Standard

Richard and Victoria MacKenzie-Childs have been dealt a minor setback in their trademark infringement case with Pleasant Rowland.

Rowland, who purchased MacKenzie-Childs from bankruptcy court in 2001, sued the couple to prevent them from commercially using their first or last names, or from using a logo design she says closely resembles one she acquired when she purchased the company. The couple are countersuing her, asking the court to dismiss Rowland's suit.

U.S. District Judge Michael A. Telesca, in the Western District of New York, in Rochester, this week rejected two of Richard and Victoria's separate court filings, called reply memorandum of law, for being too lengthy. The Western District court has a 10-page limit on reply memoranda. Richard's is 23 pages. Victoria's is 17 pages. Telesca is allowing them to file a joint memorandum of 10 pages or less, by April 6.

Who'll Be Named Winner?
Ruling in MacKenzie-Childs case expected March 21

Tuesday, March 13, 2007
By Dave Tobin, Syracuse Post-Standard

On the first day of spring, in a federal court in Rochester, a federal judge is scheduled to decide who, from then on, can commercially be known as MacKenzie-Childs, or even, as Victoria and Richard.

On one side of the courtroom will be lawyers representing the artists Victoria and Richard MacKenzie-Childs. On the other side will be lawyers representing Pleasant Rowland, who purchased the MacKenzie-Childs company from bankruptcy court in 2001.

In the meantime, Victoria and Richard MacKenzie-Childs are doing what they've always done together - creating objects, environments and events. This past Saturday, at their house in King Ferry, they planned to present a multimedia, fictional adventure story set on their ferryboat, the Yankee Clipper. The story was to use their home decor products as props, but technical difficulties scuttled it.

They had sent out 6,000 invitations. Victoria had baked more than 200 butter cookies in the shape of a house, printed with the name of their shop in King Ferry, Home Again, and signed "V&R." About 60 people attended an impromptu question-and-answer session with the couple.

As much as the event was a way to generate sales, it was the couple's assertion of personal identity, a little more than a week before an expected March 21 court decision that could determine their course as Victoria and Richard MacKenzie-Childs, if not how they make their livelihood.

In a trademark infringement case, Rowland has sued the couple to stop them from commercially using their first names, their last names, and a logo design with a Scottish thistle that she says closely resembles one she acquired when she purchased the company. Her lawyers are demanding that the couple recall any objects they have sold that bear their names or their Scottish thistle logo. The two have countersued Rowland for attaching their name - MacKenzie-Childs - to designs they did not create.

Who controls the name they are known by? Are their identities as artists inseparable from their name?

Rowland, founder of Pleasant Co., maker of American Girl dolls, is a wealthy alumna of Wells College, in Aurora, near the MacKenzie-Childs factory that the couple built. She has an ear for and attachment to distinctive names. Her given surname was Thiele. She has kept the surname of her first husband, Richard H. Rowland Jr., a Cornell graduate she met at Wells, rather than taking the name of her current husband, W. Jerome Frautschi.

Contentiousness between Rowland and the MacKenzie-Childses dates to the couple's bankruptcy filing in 2000. They owed BSB Bank & Trust $15.3 million. Rowland purchased the company and its assets, including designs and trademarks, for $6 million. Since the couple owed the bank $15.3 million, Rowland threatened to collect the roughly $10 million difference the couple still owed, unless they signed a non-compete agreement, which they refused to do. Instead, they filed for Chapter 7 personal bankruptcy to clear themselves of debt burden.

The couple laid low for several years but since then resumed making and selling home decor objects under the name of their new company, V&R Emprise, LLC, and through their Web site, www.victoriaand Sometimes, Victoria and Richard refer to themselves by their names.

Rowland sells products under the MacKenzie-Childs Ltd. name, and through the Web site Some stores sell products from both companies.

Hundreds of pages of court papers that both sides have filed essentially shape the case as one of business versus art. Both sides ask the court to protect them from the other's "unfair competition."

Rowland's lawyers argue that Richard and Victoria are selling "precisely the same type of goods" as Rowland's MacKenzie-Childs does. Richard MacKenzie-Childs, in court papers, argues that Rowland has so altered their original designs, designs that she purchased, that she cheapens their names.

"Our reputations have been hurt and diminished by . . . Rowland's use of our name and mark in connection with goods of inferior design and by Rowland's alterations to our designs in degree of quality control, in materials used, and alteration to those designs for the purpose of cheap and fast manufacture," he said in court papers.

Rowland's lawyers cite 30 trademark law case law decisions they say create precedent for a judge to rule in their favor. Victoria and Richard's case is supported by aesthetic and philosophical statements submitted by former employees, designers, even their college ceramics teacher, Wayne Higby, who all speak to the uniqueness of Victoria and Richard MacKenzie-Childs and the things they make. "They each are the 'real thing,' " Higby said in a court document.

March 21, a judge will decide whether that matters. (Copyright 2007 All Rights Reserved.)

Syracuse Post-Standard article of November 4, 2006 here,
© 2006 The Post-Standard, all rights reserved

...They purchased and are living on an old ferry boat docked in New Jersey. (They and their home are featured in this month's CNY Magazine, available on newsstands).

Contentiousness between Rowland and the MacKenzie-Childses dates to the couple's bankruptcy filing in 2000. They owed BSB Bank & Trust $15.3 million. Rowland purchased the company and its assets, including designs and trademarks for $6 million.

Rowland, the founder of Pleasant Co., maker of American Girl dolls, is a wealthy alumna of Wells College, in Aurora, near the MacKenzie-Childs factory that the couple built.

Since the couple owed the bank $15.3 million, Rowland could legally pursue the roughly $10 million difference the couple owed. She offered to forgive their debt if they signed a non-compete agreement, which they refused to do. Instead, they filed for Chapter 7 personal bankruptcy to clear themselves of their debt burden.

Newly marketing themselves with a new logo as Victoria and Richard, and as V&R Emprise, LLC, has not been enough for Rowland and her attorneys.

The couple spent more than 20 years building brand recognition around their names, which they used to name their company. When the company was sold in bankruptcy court, all its assets, including the name " 'MacKenzie-Childs' and all derivatives thereof," were sold to Rowland, her attorneys argue.

The couple say their history is inseparable from their names, and they are fighting vigorously to keep using their names.

"If you're an artist, you can't change your history," Richard MacKenzie-Childs said.

At the same time, he says that their names are irrelevant to their success.

"People would be attracted to the design and they would buy it, even if it was Sam Smith," he said.

Part of their new logo, a plaid thistle-flower, too closely resembles a trademarked thistle-flower logo of MacKenzie-Childs Ltd., (a logo they created), according to Rowland's attorneys. When one searches "MacKenzie-Childs" on Google, the couple's site appears in search results above the Web site for MacKenzie-Childs, the company. (They pay extra to give it top "sponsored site" ranking). The tagline for the couple's Web site is 'Bold new designs from the real Victoria and Richard MacKenzie-Childs.'

This summer, in the driveway and carriage house of their former King Ferry home, the couple held a "Victoria & Richard MacKenzie-Childs Barn Sale" offering new products, on the same weekend that MacKenzie-Childs held a barn sale, eight miles away.

In court papers, Norina Coursey, president of MacKenzie-Childs Ltd., took issue with the couple capitalizing on the barn sale tradition that they had started when they owned MacKenzie-Childs.

"This was nothing more than a direct attempt by Victoria and Richard to use the (trade)marks and goodwill they had previously sold in an effort to promote their own products," she said. "They promoted the sale as a 'barn sale' even though it was not held in a barn, for the express purpose of confusing customers."

Several retail shops around the United States, like Parkleigh, in Rochester, sell items from MacKenzie-Childs Ltd. and from V&R Emprise LLC. Rowland's attorneys wrote to those retailers in February, asking them to keep the items distinctly separate.

Jeannine Kaplan, owner of Parkleigh, said the two product lines each have their separate place in her store, a policy she will continue until a judge rules differently. She declined to say which product line sold better.

"You're not comparing the same things," she said. "The (inventory) expanse of MacKenzie-Childs Ltd. is huge, compared to what V& R Emprise is. It's all beautiful stuff."

Copyright 2006 All Rights Reserved.

Latest skirmish in MacKenzie-Childs conflict: court dispute shows up in barn sales

Thursday, June 15, 2006
By Dave Tobin, Syracuse Post-Standard

Home decor shoppers: Choose your barn sale. Lovers of MacKenzie-Childs china, furniture, fabrics and whatnot should be able to get their fill of the stuff, in all its forms, this weekend. Dueling barn sales are taking place Friday and Saturday, just outside of Aurora.

North of the village, the annual MacKenzie-Childs Barn Sale is being held at the factory/campus founded by Richard and Victoria MacKenzie-Childs, and now owned by Pleasant Rowland, who purchased the company out of bankruptcy court. South of Aurora, about eight miles away, Richard and Victoria MacKenzie-Childs are holding a barn sale at their residence, which is for sale.

The two sales, same days, nearly identical times, are also a public face-off of a nasty court battle over trademark infringement, about who can sell what and who can use the MacKenzie-Childs name. The battle is being waged in U.S. District Court, in Rochester, where Rowland has sued Victoria and Richard MacKenzie-Childs to prevent them from using trademarks, which include their designs and their names. Victoria and Richard MacKenzie-Childs have counter-sued Rowland, to prevent her from using their names.

A similar battle is being waged in the U.S. Patent and Trademark Office, where Rowland has filed application to trademark numerous designs for tableware and furniture, including the MacKenzie-Childs logo, and where, in January, Victoria and Richard MacKenzie-Childs filed an opposition to Rowland's application.

Officials of MacKenzie-Childs did not return phone calls about the sale. Victoria MacKenzie-Childs did not respond to e-mail questions. The dispute has a long history.

The MacKenzie-Childs company, started by artists Richard and Victoria MacKenzie-Childs, filed for chapter 11 bankruptcy in 2000. The couple owed $15.3 million, which they had personally guaranteed, to BSB Bank and Trust Co. In June 2001, Rowland acquired the business, including the sprawling factory/farm complex in Aurora, by purchasing the $15.3 million debt from BSB for $5.5 million. Rowland offered to release the remaining $10 million debt, if Richard and Victoria MacKenzie-Childs signed a non-compete agreement, which they did not.

In December 2002, Victoria and Richard filed for chapter 7, personal bankruptcy. Their largest debt, of $10 million, was to Rowland. They have been battling the bankruptcy ever since. A final meeting of creditors is scheduled for July. Meanwhile, Victoria and Richard MacKenzie-Childs started a new company, called V&R Emprise, LLC, based on a 130-foot ferry, docked in the Hudson River. They live on the boat and have designed new products lamps, tableware and ceramic pottery which are manufactured in the Philippines and Italy, according to court papers.

In court papers, Rowland's attorney, Jerauld E. Brydges, accuses Victoria and Richard MacKenzie-Childs of "employing a (legal) strategy as fanciful as the designs they made famous. Their claim, in a nutshell, is that the intellectual property (their name) was not actually sold. It is absolutely untrue."

Richard MacKenzie-Childs, in a statement filed in May, accuses Rowland of taking actions to "deliberately and actively impede" the couple's efforts to "put our lives back together." He asserts that "our reputations have been hurt and diminished, both by Rowland's use of our name . . . and . . . in connection with goods of inferior design."

"Rowland still sees fit to attach our name and trademark, 'MacKenzie-Childs' to these inferior wares," he said. Shoppers will be able to judge for themselves.

MacKenzie-Childs is promoting "50 percent off discontinued first quality ceramics, enamelware, furniture, textiles and more." Victoria and Richard are promoting "experiments and seconds of new works . . . household furnishings from the private residence of the MacKenzie-Childs family, and homemade baked goods." Victoria MacKenzie-Childs, in an e-mail, said "we look forward with jitters, sprinkled with jubilation, to be back at the MacKenzie-Childs homestead again."

Dave Tobin can be reached at or 253-7316.
© 2005 The Post-Standard. All Rights Reserved.

Famed duo to emerge for sale

Thursday, June 15, 2006
By Ann Gleason, The Citizen

MacKenzie-Childs, which laid off 20 Monday, is in strong position, president says.

Friday, November 18, 2005
By John Stith, Syracuse Post-Standard

MacKenzie-Childs Ltd. does not anticipate further layoffs among the more than 200 full-time, permanent employees working at the company's headquarters, Norina Coursey, company president, said Thursday.

"No. We really are not," she said. "We feel that we are positioned exactly the way we need to be positioned to go into '06.'

On Monday, the company laid off 20 employees.

Four employees worked in the facilities department, which maintains the grounds at the company's Ledyard campus just north of Aurora. Layoffs in the facilities department are normal as winter approaches, she said.

The other 16 employees laid off worked in production positions.

"This was just something where we found ourselves overstaffed and in a very good inventory position with very strong sales. Sales this year are very strong, and for the fourth quarter we've been making our plan, which is an aggressive plan. So, it really wasn't about sales."

Coursey said last year's gross sales totaled approximately $15 million, and she estimates gross sales for 2005 could reach $20 million.

"It's always a bit of a sad day among co-workers when you have to do this, and 20 people are very real to us. That's the sad part for us," she said. "It's not about a business that really isn't enjoying very strong sales growth."

MacKenzie-Childs manufactures handmade ceramics, enamelware, glassware, furniture and home accessories. It offers wholesale and retail sales, as well as direct sales through its catalogs and online.

Coursey said the company has hired about a dozen employees, who are working in temporary positions in the warehouse, shipping and call center as well as the retail shop, to handle increased sales volume during the holidays.

© 2005 The Post-Standard. All Rights Reserved.

MacKenzie-Childs Drops 30

March 28, 2003
By Dave Tobin, Syracuse Post-Standard

Facing a gloomy national economy and an ample supply of merchandise, MacKenzie-Childs laid off 30 employees last week, most of them in production.

"Based upon current business and world conditions, we right-sized the organization," said Anne Maddox, president and chief operating officer.

The job reductions bring total company employment in Aurora to about 200.

The company, which makes ceramic tableware and home furnishings, last year changed its production strategy from made-to-order to stocked inventory. Stocked inventory enables it to ship more quickly - products that used to take six to 10 weeks to deliver arrive in three to five days.

Two years ago, Pleasant Rowland, founder of the Pleasant Co., bought MacKenzie-Childs through bankruptcy proceedings.

In short order, she made major merchandising changes. Two new stores were opened, in Atlanta and Palm Beach, Fla.

Plans are in place to open a new store in the heart of New York City's upscale retail district, at 57th and 5th avenues. The store will be more than twice the size of MacKenzie-Childs' current store, on Madison Avenue. The company also began selling items over the Internet in November.

Maddox, a former Saks Fifth Avenue executive, said MacKenzie-Childs has not recently shifted any production overseas or out of Aurora.

"We want to maintain our core business here," she said.

The company plans to introduce several products this year, and has already introduced a fish-back bar stool. But overall sales projections are down.

"We're slowing our growth strategy," Maddox said. "Customers are not shopping as aggressively. There's a lot of concern about the world situation."

The veteran retail manager said she's seen these cycles before and is optimistic that the gloom will lift.

"The world situation will get better," she said. "The economy will get better, and business will grow more aggressively."

© 2005 The Post-Standard. All Rights Reserved.

Purchase of Area's 2nd Largest Employer: Rowland Owns Mackenzie-Childs

March 22. 2001
By Dave Tobin, Syracuse Post-Standard

MacKenzie-Childs is getting the Pleasant treatment.

Pleasant T. Rowland, who with her money and dreams is putting her mark on Wells College and the village of Aurora, was approved in U.S. Bankruptcy Court Monday as the buyer of the nationally known home-furnishing design company on Aurora's outskirts.

Before Monday's proceedings began, Rowland, who made a fortune through her Pleasant Company making American Girl dolls, had emerged as the only real contender for the company, which filed for Chapter 11 bankruptcy protection in November.

Friday, Rowland purchased from BSB Bank & Trust, Co., for $5.5 million, all of the bank's debt, securities, and collateral guarantees relating to MacKenzie-Childs. The bank, which had been owed $15.3 million as MacKenzie-Childs' only secured creditor, washed its hands of the company's difficulties.

That meant that Richard and Victoria MacKenzie-Childs, the company's founding owners, who were determined to retain ownership of the company, were not only bidding against Rowland, they owed Rowland what they had owed the bank.

Rowland's acquisition of the bank's debt also seemed to deter any other potential buyers. No one else bid on the company, which had run up debts totaling more than $18 million.

"Once someone else steps in the banks's shoes, they drive the process," said MacDonell Roehm Jr., chairman and CEO of MacKenzie-Childs.

Rowland's final offer, accepted by U.S. Bankruptcy Court Judge Stephen D. Gerling, was Friday's $5.5 million, plus $700,000 in cash to pay current expenses. When all is said and done, unsecured creditors, who are owed $2.5 million, should get between 5 cents and 7 cents for each dollar owed, said Guy Van Baalen, U.S. trustee handling the case.

From their cottage industry start 18 years ago making ceramic tableware, the couple saw sales rise to $21 million in 1997. Then a series of bad decisions sent the company's finances reeling.

Prices were raised as much as 55 percent in 1998, and sales dropped to $14 million. That same year the company launched a multi-million dollar ad campaign in the New York Times Magazine. In 1999, the company secured two long-terms leases for major stores in Manhattan and Beverly Hills. The leases were costing $3.5 million a year, and the stores never opened.

Throughout the morning in the courtroom Monday, Richard and Victoria MacKenzie-Childs sat quietly, side-by-side, while negotiations were taking place in conference rooms down the hall. Richard scribbled notes. Victoria frequently darted up, making and taking cell phone calls. Neither would comment.

"It wouldn't be the right thing," said Richard.

Rhona Vogel, Rowland's financial adviser, said Rowland was "very excited" about buying MacKenzie-Childs. "She's (Rowland) hopes to make it profitable and successful," said Vogel.

Vogel declined to say what role, if any, Richard and Victoria would have with the company.

"It's sad for Victoria and Richard," she said. "We haven't made any decision at all. Our focus has been to stay in Aurora."

The couple's personal attorney, Lee Woodard, said the couple oppose the sale to Rowland, although they did not formally object. They did not try to outbid her.

The couple guaranteed their bank loans with personal assets (their house, their cars) as well as corporate assets. When Rowland purchased the bank's debts, she also purchased the bank's guarantees, so she could legally force the couple to sell their personal assets. Woodard asked for Rowland to demonstrate some of her philanthropy toward the couple.

"We're looking for them to be reasonable," said Woodard. "We need her to help out with the debt that's going to cloak Richard and Victoria."

Van Baalen, trustee in this case, approached the couple after the hearing, and offered his condolence.

"At least the company will continue to operate," he said.

Victoria, her eyes red, only nodded.

© 2005 The Post-Standard. All Rights Reserved.


This page last updated July 23, 2007.