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Arkansas Business Presents The Best & Worst of 2015

8 min read

Best Investigative Journalist Working for Free

That’s Matt Campbell, operator of the political and legal blog the Blue Hog Report. There’s no doubt it’s left-leaning, but there’s also no doubt it’s effective, with Campbell having bagged three big trophies in the past couple of years: Lt. Gov. Mark Darr, now a former lieutenant governor; disgraced former Faulkner County Circuit Judge Mike Maggio; and plagiarist Dexter Suggs, formerly superintendent of the Little Rock School District. Campbell’s record is so solid, he can compete with those investigative journalists who actually get paid.

Worst Customer Service

In August, Payne Harding, the executive chef and co-owner of Cache Restaurant in Little Rock’s River Market District, dumped water on a small group of people protesting outside the restaurant while U.S. Sen. Ted Cruz and Gov. Asa Hutchinson were inside. Harding issued an apology a day later, saying his action wasn’t politically motivated, but he took his lumps on social media. In the spirit of the season, we give him the last word: “Cache is, and will always be, an establishment that welcomes everyone. There is no excuse for my actions, and I sincerely apologize.”

Best Highway News

The final piece of the Big Rock interchange in west Little Rock was opened to traffic in July with fanfare and much rejoicing for improved traffic flow. Motorists traversing the intersection of Interstates 630 and 430 greeted completion of the six-year, three-phase $150 million project with a marked reduction in braking and standstills.

Worst Media Contract

Affiliates of Digital First Media of New York supplied one of the most startling revelations regarding the alleged fraud-tainted wheeling and dealing of John Rogers.

In its lawsuit to recover 20 newspaper photo archives, the media concern disclosed that Rogers took possession of 13 archives without the legal nicety of a contract.

The complaint didn’t explain how Rogers was able to get the archives of newspapers such as the Los Angeles Daily News, New Haven Register and St. Paul Pioneer Press without a written agreement.

But he did.

According to the lawsuit, Rogers was supposed to provide a digital copy of the 20 archives but didn’t. He did turn Digital First photos into cash after lying and cheating his way into possession, allegedly.

Best Conflict Resolution

A Feb. 24 court-ordered auction ended long-running sibling differences over the operation of M.E. Black Farms, differences that grew into more than two years of litigation.

The sale, estimated at $85 million, resulted in a buyout of Deborah Tipton by her brother, George Dunklin Jr., now chairman and immediate past president of Ducks Unlimited.

The transaction encompassed more than 15,700 acres of farming and hunting property in Arkansas and Jefferson counties.

Worst Hype

Grainster, an online grain-trading startup business based in Conway, made a number of claims about how big it is going to be.

The company gushed it would be profitable in less than two years and add about 200 jobs in Arkansas. It also boasted it was a $200 million startup and had a potential valuation of $1 trillion in just 14 years. But upon further questioning, Grainster began providing caveats to the statements. It turned out that the company didn’t have the $200 million in hand, but claimed to have commitments over the next three years. And the person who supposedly gave Grainster officials the $1 trillion valuation denied making the statement.

Best New Steel Mill

Surely that’s the $1.3 billion Big River Steel facility going up near Osceola. Despite the August death of CEO John Correnti, the project is powering toward completion under the auspices of David Stickler, Correnti’s successor and senior managing director of Global Principal Partners of Miami, the investment group that arranged Big River Steel’s financing.

Worst Track Record

Scott Reed’s medicine show of redevelopment has produced zero completed projects since the Portland, Oregon, denizen rolled into Little Rock five years ago.

His legacy of liens and lawsuits, underscoring his financial troubles and inability to finish projects, grew this year with Main Street Lofts.

Three years after its announcement, much of the ground floor space is finished and occupied, but work on 30 upstairs apartments and more ground to a halt after the contractor walked off the job and filed a lien claim of $1.2 million for unpaid work in April.

Reed’s now 0-3 track record of overreaching, underfinanced, off-schedule, subsidy-supported efforts include:

  • The renovation of 30 residential properties, forfeited in 2012 after completing work on only one home and spending 17 percent of the project’s $1.8 million Neighborhood Stabilization Program funding.
  • K Lofts, mostly complete. But the 32-unit apartment project remains unfinished after five years and bears a $175,900 lien claim for unpaid construction work filed this year.

Best Unintended Consequence

Little Rock’s One Bank & Trust was an unintended beneficiary of a life insurance policy maintained by its former owner, chairman, president and CEO: Layton “Scooter” Stuart.

In September, the bank received a $6.9 million cut of the final distribution from Stuart’s life insurance payout. The payout came 30 months after his death as part of a settlement between One Bank, the U.S. Treasury and Stuart’s family.

The money helped rebuild the bank’s capital and represented a sizable token toward the alleged damages Stuart caused by his self-dealing.

Best Hype

Former Acxiom chairman and CEO Charles Morgan enlisted some big Arkansas names to wax enthusiastic about his memoir, “Matters of Life and Data,” published earlier this year. Dillard’s Chairman and CEO Bill Dillard hailed it as “A fascinating book!” Madison Murphy, chairman of Murphy USA, called it “An enjoyable and engaging book written by a man it is a privilege to know and work with.” Gen. Wesley K. Clark, former NATO Supreme Allied Commander, described it as “a story as American as apple pie.”

The book is, in fact, something of a page-turner, with purple passages like the following: “Data mining is the new gold rush, and we were there at first strike, dragging with us all our human frailties and foibles. In this book’s cast of characters you’ll find ambition, arrogance, jealousy, pride, fear, recklessness, anger, lust, viciousness, greed, revenge, betrayal — and then some.”

Morgan also frankly describes his acrimonious divorce and his dating dilemmas, quoting one colleague: “The big joke around the office … was that because Charles wasn’t good with names, we should get name tags for his dates to wear so he didn’t get confused.”

Amazon reviewers give it 4.6 out of 5 stars.

Best Making Up

For more than a year the Arkansas Osteopathic Medical Association opposed the establishment of an osteopathic medical school on the campus of Arkansas State University at Jonesboro. But since the Commission on Osteopathic College Accreditation in Chicago gave initial approval in April to establish the Jonesboro location, AOMA has improved its relationship with the New York Institute of Technology, which will operate the school. AOMA Executive Director Frazier Edwards said in August that it was “in conversations with NYIT on developing a relationship that will yield positive collaborations between our two organizations.”

AOMA has always supported the Fort Smith Regional Healthcare Foundation’s plans to launch the Arkansas College of Osteopathic Medicine. Both schools are scheduled to open next fall.

Best Reason to Understand the Question

The question on the home seller’s disclosure sheet appeared simple enough: whether, to your knowledge, “is there or has there ever been any past or present water intrusion?”

Kathleen “Kathy” Blasingame, who sold her Hillcrest home to Dr. Joel Dworkin for $1.25 million, said that “as I understood this question, I read it as water seeping into, being in the house, damaging the house, and I knew that had not happened.”

Dworkin thought otherwise and sued Blasingame, alleging she committed fraud by not revealing condition problems with the house, including leaky windows, when she sold it.

A Pulaski County Circuit Court judge ruled in favor of Dworkin and awarded him $102,200 in damages, and court costs and attorneys’ fees of $173,874, for a total judgment of $276,074.

Best Jury Award

A U.S. District Court jury in El Dorado awarded $72 million to Lion Oil Co. of Brentwood, Tennessee, which took its insurance carriers to court for not paying the multimillion-dollar claim tied to a months-long interruption of work at its oil refinery in El Dorado.

Worst Doctor

Dr. Robert Barrow of Little Rock pleaded guilty in October in U.S. District Court in Little Rock to conspiring to commit health care fraud that cost health insurance companies $2.2 million.

The 62-year-old, who owned and operated Your Doctor’s Office medical clinic, admitted that he conspired with Billy Marc Young, a local massage therapist.

Barrow referred patients to Young. Young’s services were then billed to health insurers under Barrow’s provider number as if they were physical therapy — even at times when Barrow himself was out of the state or out of the country in places like Las Vegas, Hawaii and London.

Best Branding

Yellow Rocket Concepts, the Little Rock restaurant juggernaut behind Big Orange, Local Lime, ZaZa, Lost Forty Brewing and Heights Taco & Tamale, is doing growth right. The partners — Scott McGehee, John Beachboard and Russ McDonough — are tireless in their pursuit of quality, as is Amber Brewer, brand manager and Beachboard’s wife, in her pursuit of consistency. The result is a fun, hip brand that offers good value and appears poised for continued expansion.

Worst Departure

Dr. Bart Barlogie, who is considered one of the top doctors in the world when it comes to treating myeloma, left the University of Arkansas for Medical Sciences at the end of August. Barlogie founded in 1989 the Myeloma Institute at UAMS in Little Rock and is now working at The Mount Sinai Hospital in New York.

Best Way to Keep Costs Down

Arkansas Business surveyed more than a dozen public colleges and universities across the state in 2015 and found two-year schools typically pay adjuncts between $1,200 and $2,000 per three-hour course taught, while four-year schools generally pay between $2,000 and $2,500. Adjuncts, who almost always hold graduate degrees, usually don’t have benefits. Many of the adjuncts would like to be full time or be on a tenure track, but those positions aren’t available. As a result, the adjuncts don’t have job security and might not be rehired at the end of the semester.

Worst OREO Sale

Call it the $11.1 million real estate auction that wasn’t.

Lex Golden, special assets manager at Allied Bank, talked in April about selling all of the bank’s OREO, which included property collected from bad real estate loans and closed bank branches.

Golden, whose family owns controlling interest of the bank, even scheduled a series of auctions July 21-24 toward that end.

But the auction didn’t convert much property into cash.

Allied Bank began the third quarter with $11.1 million in OREO, and ended with $10.6 million.

Meanwhile, Allied’s parent company, Acme Holding Co., drifts toward liquidation after its Chapter 11 bankruptcy was converted to Chapter 7 this summer.

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