128 



Maxxam and Hurwitz are under investigation by the Federal Deposit 

 Insurance Corporation for a bankrupt thrift known as United Savings 

 Association of Texas. Estimates are that Hurwitz and Maxxam could owe the 

 federal government in excess of $500 million for, according to the Wall Street 

 Toumal. "breach of fiduciary duty and wrongfully failing to maintain the net 

 worth of a failed thrift linked to Michael Milken." 



In order to show their concern for retirees from Pacific Lumber, Maxxam 

 looted Pacific Lumber's pension fimd of $60 million dollars for other 

 corporate buy-outs and debt reduction. Maxxam purchased annuities at the 

 now bankrupt Executive Life Insurance Company. This action put the 

 retirees' pensions at risk. The U.S. Labor Department sued Maxxam over this 

 action alleging Maxxam breached their fiduciary duty to members of Pacific 

 Lumber's pension plan. The suit is pending. 



Once Maxxam owned Pacific Lumber, it immediately and significantly 

 increased the cutting of redwoods, including virgin, old growth redwoods. 

 Maxxam's rate of cut is double to triple the rate of harvest under the old 

 Pacific Lumber. According to Newsweek. July 27, 1993, the "Redwood 

 Raider... began mowing dovim California's coastal redwoods." This level of 

 cut was based on what is good for Maxxam's junk bond debt and interest 

 payments, not what is good for the economic stability of California's North 

 Coast. The level of cut certainly was not based on any kind of sustainable 

 yield basis. There was no consideration of the pressures this level of cut 

 would have on endangered species, such as the marble murrelet. 



Maxxam's eagerness to chain-saw thousand-year-old trees for quick profit has 

 run them afoul of federal and California endangered species laws. Maxxam is 

 being investigated by the U.S. Fish and Wildlife Service and the California 

 Department of Fish and Game for two apparently illegal cuttings of significant 

 amounts of old growth redwood in an area known as Owl Creek, a nesting 

 area for the endangered marbled murrelet. According to the Wall Street 

 Tournal "Fish and Wildlife is considering seeking criminal charges. Says 

 James Steele, the top state biologist for Owl Creek: 'They basically conducted 

 sneak attacks out there.'" While pretending to look for marble murrelets, 

 Maxxam has renewed requests to cut down prime habitat areas like Owl 

 Creek. 



Lest one think the spots have changed on Hurwitz or Maxxam, one does not 

 have to look any farther than the recent corporate refinancing conducted this 

 year by Maxxam. Once again in the refinancing Houston corporate interests 

 are dominant. Once again a sustainable job base and environmental concerns 

 are sacrificed to Maxxam greed. Hurwitz and Maxxam have issued almost 

 $600 million in new bond debt to pay off the existing $510 million in debt. 



