Columbia Falls Aluminum Company.

The bittersweet taste of a $97 million payday continues to linger on the collective palate of the Flathead Valley, with many wondering where all the money went and whether they bit off less than they could have chewed.

Early in 1998, workers and owners at the Columbia Falls Aluminum Company hammered out a deal to settle their longstanding battle over profit shares. Workers had argued that company owner Brack Duker held back profit shares to the tune of $154 million, cheating employees while lining his own pockets. The shares, workers said, were promised to employees under a 1985 agreement that required them to give up wages and benefits in return for a cut of the company's annual take.

Duker, they claimed, never lived up to his end of the bargain.

In an 11th-hour settlement, workers overwhelmingly agreed to accept the $97 million settlement, just days shy of a January 12 trial date. After a six-year battle of litigious maneuvering, the company paid the cash, but admitted no wrongdoing.

Throughout the Flathead Valley, speculation ran wild as to how nearly $100 million split among 1,000 workers might affect personal lives and regional economies. The outlook for all, most agreed, was nothing but bright.

Eight months later, with the headlines yellowing and the cash safely in the bank, many workers are somewhat frustrated with the deal they brokered, saying the tax man and the lawyers took more than anyone expected. Retailers are also frustrated, wondering why those promised "skyrocketing sales" fizzled into smoke.

"It's definitely a bittersweet victory," said Terry Smith, president of the Aluminum Workers Trade Council. "Duker stole our money, then fought us with our own money, and in the end he still has quite a bit of our money and we have a hell of a lot less than we deserve. But the option was to risk it all, so I guess what we got is better than nothing."

The Deal

The battle over CFAC profit shares dates back to the early 1980s, when the company was struggling to stay afloat, awash in low aluminum prices and high electric costs. Electricity, the catalyst for turning alumina powder into aluminum, is a major concern at CFAC. The company consumes nearly a quarter of all the power used in Montana.

Then-owner Atlantic Richfield Company, seeing no immediate hope for the aluminum market or the price of power, wanted out from under the sinking plant.

The small blue-collar town of Columbia Falls, however, was not willing to see 1,000 perfectly good jobs disappear. Upward of 3,000 people would gather at town meetings in those years, and the "Save the Plant" slogan became a town motto.

ARCO eventually sold the plant to Duker for a token $1 in 1985. Duker, an ARCO executive, also paid $3 million for the inventory.

Under the sale agreement, ARCO and Duker agreed that, should the plant recover, workers would receive 50 percent of all profits.

"A dollar in your pocket is a dollar in mine," was a phrase many workers recall Duker trotting out at various negotiating meetings. Over the next several years, however, Duker and minority partner Jerome Broussard put about $84 million in the workers' pockets, while stuffing their own with $231 million, employees say.

The inequitable split, Duker's lawyers argued, was due to corporate tax laws.

After purchasing the company, Duker used the threat of a plant closure to broker a deal with the state that drastically reduced CFAC's property taxes. He also won enormous cuts in company electric rates with the same threat.

He slashed costs throughout the plant, and convinced workers to accept a 15 percent cut in wages and benefits in return for 50 percent of company profits. That deal, workers agreed, was better than a shutdown and no wages at all.

The Discrepancies

Duker's approach paid off, and within a year the company was again making money - so much that workers and owners split $2.6 million in profits, 50-50, right down the middle.

The following year, 1987, company owners borrowed on their projected profits, taking $6.5 million out of company coffers. It was paid back at year's end, but without interest. Company accountant Revo Somersille thought the move unethical, but continued to balance the company's books despite his concerns.

Two years later, when owners cut into worker's profits to pay CFAC's Social Security taxes, Somersille raised the red flags. He was fired shortly thereafter.

His replacement, however, proved equally as principled and more than ready for a fight.

Roberta Gilmore moved up the ranks into Somersille's job, and immediately noticed the same accounting discrepancies.

By 1992, she said, profit shares to workers had stopped entirely.

Gilmore finally called on old friend Roger Sullivan, a partner in the small-town firm of McGarvey, Heberling, Sullivan and McGarvey. With the help of the Kalispell lawyers, she filed a class action suit on behalf of herself and the plant's other salaried employees. Hourly workers later filed a suit of their own, and the two groups joined forces against the owners.

The morning after Gilmore filed suit, she was placed on paid leave. Eleven months later, in August 1993, she was fired.

The end of her job crunching numbers for CFAC, however, was just the beginning of a number hunt that led her attorneys around the world and into the labyrinth of big business.

The Hunt

For five years, McGarvey and Sullivan followed the money, discovering that for the first three years of profit sharing the money was split almost evenly. Owners had taken about $29 million, giving workers about $27 million.

But by the end of 1988, the annual split was $43 million to owners, $14 million to workers. Over the next two years, owners took $159 million and gave employees $43 million, saying there was no official profit sharing contract.

Any payments, Duker argued, were made at the company's discretion.

A federal judge disagreed, however, saying there was indeed a profit sharing contract and workers were entitled to profits, if any, that were withheld.

McGarvey and Sullivan-who had mortgaged everything under an $850,000 loan to keep the case moving over the years-located an "empty" company in the Cayman Islands, where they believed Duker had been funneling the cash intended for workers.

Duker responded to the Cayman Island discovery by offering a $12 million settlement, which was soundly rejected.

The Kalispell attorneys later learned of offshore bank accounts on the Isle of Man and Gibraltar where Duker and Broussard were holding CFAC money.

This time Duker responded with a $50 million settlement offer. It was again shot down by workers, who were eager to get to trial.

That trial, expected to drag on for months and include hundreds of witnesses, was averted at the last minute, when Duker made his $97 million offer. It was five days before Christmas, and two weeks before the trail was to begin.

The Settlement

Even those workers eager to see Duker in court were hard-pressed not to accept the settlement.

Speaking two days before the union vote, one worker summed the attitude of most at the plant by saying, "That's one hell of a lot of money. Maybe he (Duker) isn't paying us everything we've got coming, but how can you just turn your nose up at a check for $60,000 after taxes? We can pay off our houses, we can pay off our cars. We can buy a new boat or plan for retirement.

"Or, we could refuse the offer and go through seven years of trials and appeals. We've got a bird in the hand. Do we shoot for two in the bush? It's a crapshoot I'm not willing to bet on."

Employees opted 4-1 not to take the risk, choosing instead to take the bird in the hand.

Duker's offer totaled $65 million for union workers, well shy of the $100 million they said they were owed. For salaried employees, the settlement offered $32 million, or about two-thirds of what they said was theirs by law.

The $65 million paid to union members was split according to the number of hours worked by each employee over the years, with an average payout of about $100,000. Salaried employees split their $32 million based on their annual earnings and tenure, and averaged $150,000 apiece. Some individuals netted upward of $300,000.

The lawyers, who worked six years without pay and put their lives into hock chasing Duker and Broussard's financial records, took home about $6 million for their work on the salaried employees' case, and another $6.5 million for the work for the union.

"It's been a long road," said union president Terry Smith, speaking on the eve of the settlement vote. "This ending is a lot like kissing your sister; a kiss is a kiss, and you're not exactly complaining, but you can think of a lot of ladies you'd rather be kissing. He still owes us $50 million."

And that may not be all Duker owes. A member of his massive legal team is now suing his former client, saying Duker reneged on paying him his due. Attorney Douglas Wold claims Duker never paid him a promised $3 million bonus for keeping the settlement to $100 million or less.

Although most people agreed that Duker had not paid workers their full share in the CFAC settlement, the community was nevertheless excited about the prospect of a major payday, saying the town would never be the same.

"It's going to be a crazy party in this town," said one union worker. "Just imagine it, $100 million right here. Nine hundred people with unlimited money, at least for a month."

Payday

Banking on such optimism, retailers throughout the Flathead braced for the spending spree. The settlement, economists said, totaled 12 percent of the Flathead Valley's total yearly labor income, and should be a tremendous shot in the arm for all sorts of businesses.

Investment brokers started calling CFAC employees at home. Truckloads of hot tubs wheeled into town for special CFAC sales. Newspaper ads targeted the workers and their families, urging them to buy, buy, buy. Flyers appeared under CFAC worker's windshields, and some businesses set up shop at the plant entrance, hoping to get in on the cash.

"We're getting six or seven pieces of junk mail every day," said Judy Berardi, wife of a CFAC salaried employee. "Everyone wants to sell us something...it's disgusting. When we get our check, you can bet we won't give a dime of it to locals like that. We'd rather spend it out of town than give it to these people who have kept a hand in our wallets for months. And we're not alone. I'll bet a lot of people are so disgusted they won't spend it locally."

But some employees, although a minority, were ready to oblige the Flathead's more eager businessmen. One union worker, a 17-year-veteran at the plant, bought a brand-new pickup, expecting the check to be in the mail any day.

That was February.

But the check wasn't there at the end of the month. Nor was it there at the end of March. An announcement of an April 1 distribution of checks fooled everyone.

Meanwhile, the truck payments were coming due. Although the dealer was willing to wait-knowing the money would come eventually - the state was less patient. The truck sat, parked in the driveway, without license plates or insurance, both too expensive for the time being.

Others spent money before they had it in hand, buying a $100,000 recreational vehicle, for instance, and then having to take out a loan to cover it once the settlement's tax implications hit home.

In the days following the settlement announcement, everyone was talking about buying or selling, predicting what sort of jolt the region could expect. Most planned on seeing fleets of shiny new trucks, cars, boats, motorcycles, and recreational vehicles.

"I suppose some of the guys will invest a bit," ventured Del Baker, sales manager at Kalispell's Ford dealership, "but the vast majority of the cash will flow right into the Flathead economy. I know a lot of the guys out there, and most of them are going to treat themselves to a little something in the way of fun."

The Media

It seemed everyone wanted to know how Columbia Falls would respond, and the story of how the money would be spent soon went spinning around the world.

But the international media paid little attention to Gilmore or Sullivan or McGarvey, or even to Duker and Broussard. No one mentioned the Cayman Islands, the Isle of Man or the huge disparity between owners' shares and those of workers. No one mentioned the fact that workers had put in a decade of shifts for a lower wage than they were making back in the early 1980s.

Instead, the Wall Street Journal quoted a reference to workers as "the Beverly Hillbillies," implying that they had struck it rich by chance alone and were now completely unprepared for their newfound fortunes.

Hot on the heels of the Wall Street Journal came the other major news agencies, including weekly news magazines from as far away as Germany.

Sitting in a local tavern one evening, watching a television crew set up behind the bar, one union worker summed up the town's resentment of such treatment before stalking out into the street.

"Take 1,000 people in a small town," he said, "add $100 million, stir it up good and bang, you've got a media frenzy."

In the end, however, the media was duped. So were the hopeful retailers and the few workers whose money burned holes through their pockets before it even arrived.

The Economic Impact

In a deal with the IRS, attorneys agreed to a flat tax for all employees, regardless of the size of the individual settlement check. The federal government took 28 percent, just shy of the 31 percent maximum. The state of Montana took 8 percent, three notches beneath the 11 percent cap. Add in 7.65 percent for employee taxes - because the checks were considered wages- and nearly half the money was gone.

When the lawyers' share was added to the take, more than 50 percent of the settlement never reached the workers.

"Between the attorneys and the feds," Baker said from his car lot, "nobody got near what they thought they would." His earlier predictions of a business boom have yet to materialize. Baker, who had once said, "it's going to be nothing but good news for both the workers and the valley," was, like many other businessmen, changing his tune.

"Sure, we sold a few rigs on account of the settlement," he later acknowledged. "But it wasn't anywhere near what we thought it would be."

According to Montana's Motor Vehicle Division, 1,040 cars were sold in Flathead County through June of 1998. That's about 4 percent better than last year, when 998 cars sold in the same time period. Truck sales were up about 20 percent in the Flathead, with 627 new rigs driving off the lot compared to 522 last year. Motorcycle sales jumped about 18 percent, increasing from 185 to 219.

Those increases suggest the settlement money may have had a some economic impact, especially when compared to statewide numbers. Throughout Montana, car sales dipped by 2 percent in the first six months of the year, while truck sales grew by 2 percent, and motorcycle purchases were up by 3 percent.

A few extra car sales, however, does not explain away the $50 million or so left to workers after taxes and lawyers.

"I suppose they invested it," said Craig Kendall, manager at Kalispell's Vann's Appliance store. "They sure didn't spend it here. We hoped to sell some hot tubs and big-screen TVs, but it never happened. Maybe they just paid off debt and stashed it away for a rainy day, or maybe they took a vacation and spent it out of town."

While most agree that much of the settlement money was used to eliminate debt and invest for the future, there is no evidence to support Kendall's vacation theory. Boardings at Glacier Park International Airport were actually down slightly in the first half of 1998, and travel agents say they have seen no sign of vacationing aluminum workers.

Neither have employees been investing in the Flathead's hot real estate market. Brokers say they've had a few lookers, but not many buyers. One local resident, whose rural home sits on a small lake just six miles north of the plant, put his property on the market one week after the settlement check arrived. He said he hoped to cash in on the settlement and move back to Washington state.

The place was snapped up fast, just as hoped, but not by a CFAC family. The buyers were nurses from Cleveland, and no CFAC families even called to see the home.

"It [the settlement money] didn't make it to the retailers," said Bill Hendrix of American Investment Services, Inc. "It didn't fly off on an airplane or go toward a new house or some real estate. It went to pay off debt and then the rest went into the bank. The people I saw invested it as a nest egg or as a college fund. To me, I think that this group was pretty darn fiscally responsible."

Said the wife of one salaried worker, "of course we invested everything we could. It got tight over the years. When the paychecks were cut smaller and there were no profit shares, it got really tight. You did what you could."

Sometimes, she said, doing what you could meant living on loans or credit cards, a reality still fresh in the minds of many CFAC employees.

"When they got done taking care of debt, the last thing they wanted was more debt," said Kim Taylor of Investment Centers of America, Inc. "Most people I know invested the rest."

But even with a comfortable bundle in the bank and a mortgage that no longer looms, many CFAC workers say their life has not changed much-except that the stress of a lawsuit is now behind them.

They do, however, continue to taste the bittersweet flavor of the settlement deal.

Duker still owes them, they say.

He never admitted guilt, they say.

The taxes were unfair, they say, lumped all at once instead of spread out over the past decade.

"Who knows if it was a good deal," Smith said recently from his union office. "We got less than 50 percent of our money, that much I do know.

"We didn't get the trial. We didn't get Duker on the stand. But there's a great union message here for America. Here's this little union in this little town in Montana where people stood up for their rights and won."

Michael Jamison is a Columbia Falls area writer.