“It seems to be half-assed, to be quite frank. […] Thank God not everybody’s like that.” – White Eagle Steel CEO Tim Kmiecik
DeVos sellout Tudor Dixon repeatedly touts her business leadership cultivated at Michigan Steel, a foundry in Muskegon owned by her father that employed Dixon and her husband for years before laying off its entire 300-employee workforce and being completely liquidated by 2013. In her own accounts on the campaign trail, Dixon established herself a company executive with a hand in “every aspect” of the Michigan Steel’s day-to-day operations.
A new Bridge Michigan deep dive is exposing the foundry as a “half-assed” business that “struggled to pay bills” even while the steel industry was booming.
The company earned a reputation for failing to pay vendors, bouncing checks, getting sacked with tax liens, refusing to pay utility bills to the point that even trash pickup got suspended, having foundry property “seized by court officers,” and “maintaining its own operations by using ‘other companies’ money.’”
Despite Dixon’s tenure occurring during a “generally healthy” time to earn profits for companies in the iron and steel industries at large, and the fact that Michigan Steel similarly experienced a boom in annual revenues during the years she was there, the foundry still managed to rack up dozens of lawsuits from as many entities over unpaid bills. Michigan Steel even failed to honor a number of the court-ordered settlements totaling half a million dollars owed to vendors, an agreement breach that was never satisfied upon the foundry’s closure.
See excerpts below from Bridge Michigan on the significant operational failures Dixon is hiding behind campaign spokespeople to claim she was “not involved in or aware of” during her time leading Michigan Steel and read the full report here.
Bridge Michigan: Tudor Dixon Touts Work at Michigan Steel. Foundry Struggled to Pay Bills.
By Jonathan Oosting
An empty field marks the spot where Tudor Dixon began her professional career in Michigan’s steel industry, surrounding warehouses the only visible reminders of her family’s foundry that shuttered in late 2012 and was later demolished.
Dixon, the Republican nominee for governor, has touted her seven years as an executive at Michigan Steel Inc. as evidence she’s prepared for “tough battles” as governor. She has distanced herself, though, from the eventual collapse of her father’s firm, which occurred three years after she left the company upon becoming pregnant with her first child.
But court records reviewed by Bridge Michigan indicate the Muskegon foundry struggled with cash flow while Dixon worked there, well before Michigan Steel laid off its entire workforce — which had topped at near 300 employees — and liquidated the company her dad purchased in 2002.
More than two dozen suppliers sued Michigan Steel during Dixon’s tenure. […]
“They were always slow payment,” said Tim Kmiecik. CEO of White Eagle Steel of Spring Lake, which sued Michigan Steel over unpaid bills from 2008.
“It seemed to be half-assed, to be quite frank.”
Dixon’s campaign declined an interview request about her tenure at the steel foundry. In an email, a spokesperson said Dixon was “not involved in or aware of any of the lawsuits” and described her role in the company in more limited terms than she has in the past.
Dixon primarily worked as a sales executive, where her objective was to “grow revenues,” which rose from $8 million annually to “over $30 million when she left in 2009,” said the spokesperson, Kyle Olson. […]
She moved to Michigan in 2002, where her father, Vaughn Makary, hired her to work at the aging foundry he had bought out of bankruptcy. Her husband, Aaron Dixon, got a job there, too. […]
Dixon worked in sales and later human resources but told Bridge Michigan earlier this summer she eventually helped run “every aspect” of the business.
“I was really helping him (her dad) make the big decisions, but went from dealing with the small things on the customer service side to everything that had to do with our largest deals with customers across the globe,” Dixon said earlier this summer.
She also promoted her leadership at the foundry following her victory in the Republican primary in August, citing the difficulty of “running and growing” the company as a woman. […]
The Republican gubernatorial hopeful left Michigan Steel in 2009, exiting the company amid the Great Recession to start a family. That was three years before Michigan Steel collapsed amid tax liens, unpaid property taxes, layoffs and bounced checks to employees. […]
Court records show Michigan Steel struggled to pay suppliers during Dixon’s tenure, which predated the Great Recession and was a period of generally healthy profits in the U.S. iron and steel industries.
The company, which sat on 1,700 feet of Muskegon Lake frontage in a heavily industrial area of the city, was sued by vendors more than two dozen times over unpaid bills from 2003 to 2009, the year Dixon left the company, including 10 lawsuits prior to 2007, according to court records.
Among other things, plaintiffs allege the foundry did not pay trash and gas bills, bounced checks to suppliers and was forced to return rented forklifts.
In most cases, Michigan Steel settled with suppliers in court. But the firm was accused of failing to honor settlement terms in at least three cases, had property seized by court officers as early as 2008 and did not pay off all judgments before closing in late 2012 and liquidating early the next year.
In 2005, a boom year for the steel industry, Consumers Energy sued Michigan Steel over a $51,055 natural gas tab, alleging the company “failed and refused to pay” its bills in a “material breach of contract,” according to court records. […]
White Eagle Steel sued over $30,775 in unpaid bills in 2009 dating back to the prior year. The firm was eventually paid through a court settlement, but the legal fight was emblematic of long-running issues at the foundry, said Kmiecik, the White Eagle CEO.
Michigan Steel appeared to be maintaining its own operation by using “other companies’ money,” essentially borrowing funds by delaying payments, Kmiecik said. It’s not the only company in the steel industry that used that business model, but it was a “standout,” he said.
“Thank God not everybody’s like that,” he told Bridge.
In 2009, Waste Management suspended trash service at Michigan Steel and sued the company for $62,074, demanding payment for unpaid bills and service charges from 2008. A default judgment authorized court officers to seize and sell Michigan Steel’s personal property but the foundry went out of business before Waste Management was able to recoup its full losses.
Authorities had collected $20,000 from Michigan Steel by April 2013, when a court officer visited the foundry again but informed the court that “no property was seized” because the “business has closed and is no longer operational.”
Court records show General Electric Capital, the parent company of Alta Lift Truck, sued Michigan Steel in 2010 for $313,402 in unpaid bills dating back to 2008, when Dixon said she was working alongside her dad in a leadership role. The foundry was eventually ordered to return 11 forklifts it had rented from the firm, but it’s not clear if Michigan Steel was able to pay off its full debt before going out of business in 2013. […]
But as a 31-year steel industry veteran, Kmiecik said he’s gotten to know “the good, bad or kind of in-between. And Michigan Steel, he said, “seemed to fall between the bad and in-between.” […]
