The Rise and Fall of Ed Harvey's Business Empire

by Mark Friedman  on Monday, Aug. 2, 2010 12:00 am  

"He had gotten frustrated with the banks in Arkansas," McDowell said. "The banks were failing down here in Texas, and he just decided to come down here and buy his own bank."

Preston National Bank grew, but slowly. In 1992, the earliest financial figures available from the Federal Deposit Insurance Corp.'s website, the Dallas bank had $15.5 million in assets and $223,000 in net income. By 1995, the bank's assets had nearly doubled, to $29.6 million, and its net income was $473,000. But 15 years later, Preston National's assets are only $60.5 million - smaller, that is, than Logan County Bank at Scranton - while it earned $1.1 million in 2009.

Harvey "ran that bank like a business," McDowell said. Harvey also started Travis Lumber Co. in 1988, but no financial information for that company is available.

 

Lawsuits

Not all of Harvey's business ventures were successful, and squabbles with his managers have been common.

Harvey, Bill MacPhee and Brent Leslie formed the Harvey Group in 1987 "for the purpose of acquiring, developing and selling various businesses," according to a lawsuit MacPhee filed in Pulaski County Circuit Court in 1988.

Harvey eventually had separate legal battles with both MacPhee and Leslie. Harvey won a $50,000 judgment from MacPhee while his case with Leslie was dismissed for failure to prosecute.

Similarly, Harvey bought part of Beech Trucking Co. of North Little Rock in 1990 and ended up in a legal fight with minority owner Arthur Beech over $1.1 million worth of missing equipment. Harvey invested "$2 million of his own money in the ultimately doomed enterprise," which closed in 1998, according to filings in the case which was dismissed in 2003 on Harvey's motion for a summary judgment.

In 2002, Diane Miller, who had been president of Continental Express since 1999, filed a lawsuit against Harvey and Continental alleging that she was paid less than her predecessor, Ralph Bradbury, because she was a woman.

Miller was hired in 1985 and was promoted to executive vice president in 1986. During her tenure as president, Harvey "continually complained" about the performance of the company, according to the court filings. In 1999, Continental reported revenue of $61 million to Arkansas Business. By 2001, Continental's performance "was substantially worse than it was in 1999," the court filings say, although no financial numbers are listed in the filing. In 2002, Continental reported revenue of $82 million with 540 trucks and 700 employees to Arkansas Business, but the company's profitability is unknown.

Both sides agreed to dismiss the case in June 2004.

 

 

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