The Woman Who Overturned an Empire by Alanna Nash

SALLIE BINGHAM, THE 49-YEAR-OLD fiction author, playwright, feminist, and founder of the Kentucky Foundation for Women, was in the middle of a lunch with friends last January, when she got a phone call. That was how she learned that her family’s $390-million Louisville-based communications empire—Bingham owned and operated for three generations—had been put up for sale by her parents. Barry Bingham, Sr., the 80-year-old family patriarch and chairman of the boards, called it the hardest decision he’d made in his life.

Sallie Bingham had made her own hard decisions. She was concerned about the management and politics of the Louisville Courier-Journal, one of the nation’s outstanding newspapers, but it was her anger at the systematic exclusion of herself and other women in the family from the family boards, that had caused her to put her stock up for sale. Though hers was far from a controlling interest, and thus would leave any buyer locked into a family-controlled company, her action began a chain of events that ultimately led to the sale of the Bingham companies.

There appeared to be a family feud over simple money. But perhaps the real issue is not greed so much as values like equality and justice, which had far different meanings for each of the three living Bingham offspring.

For Sallie Bingham, the eldest daughter and third of five children, the unrest went back to her childhood; she feels that she lived with restrictions with which her two older brothers did not have to contend. There was a problem of not being expected to take large roles or risk-taking positions in important matters, or in life itself.

With Barry Jr., four years older than Sallie and the second-born son, the sting was to come first in adolescence. Sallie remembers him as a shy child who was overweight, and, according to his family, dyslexic; he watched his older brother, Worth, outshine him in sports and leadership. Even his younger sister, Sallie, eclipsed him in schoolwork and creativity. Later, after he had successfully been treated for Hodgkin’s disease (in 1971), and given his adult years to the running of the Bingham companies after the death of both the older brother, Worth, and the younger, Jonathan, in separate freak accidents, the perceived criticism from his family that he had not done his job well would be almost unbearable.

As for Eleanor—the youngest child, born a decade after Sallie—there was a profound ambivalence. Perhaps she identified to some degree with both her sister and her brother. While she shared Sallie’s anger at the family’s double standard for women, she also understood Barry Jr.’s insecurities. She, too, may have known how it felt to be compared to an allegedly brighter or more talented sibling. (After extensive publicity in the national media—including the television show “60 Minutes”—the Bingham family recently signed a pact barring further discussion of their situation with the press. Consequently, Eleanor declined to be interviewed for this story.)

Because they were Binghams—aristocratic, wealthy beyond most people’s imagination, subscribing to an almost British reserve that forbade open displays of emotion or even affection—they did not talk about these problems among themselves. But because they were human, the resentment would accumulate through the decades and turn into rage.

Ironically, this tragedy of noncommunication took place in a communications empire. Its power started with Robert Worth Bingham, a not-so-prosperous 25-year-old lawyer who moved to Kentucky from North Carolina in 1896. Known as Judge Bingham because of a stint in the circuit court, he is said to have made three vows when he first moved to Louisville: to marry a rich woman, to become the mayor of the city, and to be appointed to the Court of St. James as United States ambassador to England. He would achieve all three.

The Bingham money came from women: both the second and third of Robert Worth Bingham’s wives. The first gave birth to Barry Sr. and two other children, before dying in a car accident in 1913. Bingham then married Mary Kenan Flagler, the widow of Henry M. Flagler, the Florida oil and railroad tycoon from whom she had inherited an estate worth more than $100 million. After only a few months of marriage to Judge Bingham, she suddenly became ill of what was called a heart ailment and died, leaving her new husband $5 million.

Her family believed Bingham had poisoned her. In a much-publicized case, they contested the will and had her body exhumed for autopsy. Though the autopsy results were never publicly disclosed, the following year, 1918, Robert Worth Bingham collected his windfall and used $1 million of it to buy a majority interest in the Courier-Journal and Louisville Times. (Later, Bingham bought the papers outright.) A liberal Democrat, Bingham set about winning his ambassadorship through his editorial and financial support of Franklin Delano Roosevelt. (During the confirmation hearings, White House aide Raymond Moley helped to keep the wife-poisoning rumors quiet.) Meanwhile, Bingham married another wealthy woman; he took up his ambassadorship in England in 1933. When he died four years later, Joseph P. Kennedy, Sr., founder of a family to be powerful but doomed in many similar ways, was appointed to succeed him.

With Judge Bingham’s son, Barry Bingham, Sr., as their president from 1937 to 1971, the two newspapers won three Pulitzer prizes, and bucked southern conservatism to support school desegregation, labor unions, environmental protection, and women’s rights. The Bingham empire would ultimately include a CBS television affiliate, two top-rated radio stations, a printing operation, and several smaller subsidiaries.

Worth, Barry Jr., and Sallie, born in the 1930s, grew up at Melcombe, a Georgian mansion east of the city on some 40 acres overlooking the Ohio River. The younger two children, Jonathan and Eleanor, came along considerably later, in the 1940s. Since their father traveled frequently on business and their mother was caught up in numerous social obligations, the children were, for the most part, reared by the five servants, including “Nursie,” a plain-spoken, rural Kentucky woman with whom Sallie was very close.

After the older boys went away to prep school, Sallie continued to develop her already close relationship with her father, who read the classics to her and encouraged her writing. She did not, however, have an especially close rapport with her mother. Although Mary Bingham was a conventionally supportive wife to her husband, she edited the Courier-Journal‘s book page for many years, and is also said to have had a hand in determining the editorial content of the papers in her husband’s absence during World War II. Today, Mary Bingham is thought to have significant influence in her husband’s major decisions, including the recent business decision to sell the companies. “It’s one of those partnerships where you almost can’t tell where one person ends and the other begins,” Sallie says.

The Bingham children were exposed to a parade of events and opportunities, as journalists, politicians, and other public figures routinely visited the house. When the Duke and Duchess of Windsor attended the 1951 Kentucky Derby, they stayed with their old friends the Binghams.

Nonetheless, books and ideas, not wealth and glamour, were the real family values. From the time the Bingham children were old enough to read the plaques on the walls of almost every civic and cultural organization in town, they were aware that their parents, in the tradition of the great old publishers, put their money back into the community and especially suppported the arts. (The Bingham Foundation—funded by profits from the businesses—contributed $1.2 million to education, the arts, social services, and other causes in 1985 alone.)

Worth, the eldest son and thus the heir apparent, like his father, went to Harvard, did a stint in the Navy, and returned to Louisville to be groomed in the 1950s to take over the newspapers. To Sallie, Worth seemed fascinating and complex, but also cruel and unsparing. As a teenager, Sallie recalls, he had mercilessly teased Barry Jr. about his weight, even in public. Around town, Worth developed a reputation as a high roller, a risk taker, and as something of a cad. A family friend recalls sitting with him at a mixed-company, black-tie affair when a fruit cocktail was served. Picking up his spoon, Worth surveyed the cherry on top and announced to the table, “I get every cherry in Louisville.”

Meanwhile, Barry Jr., only a year behind the brother he idolized despite his small cruelties, graduated from Harvard, where he had slimmed down as a rower; he joined the Marines, and worked on documentary films for NBC, then returned home to take his place at the family broadcasting station, WHAS.

In the same period, Sallie was building a national reputation as a writer. Her first novel, After Such Knowledge (Houghton Mifflin), appeared in 1959, shortly after sbe graduated magna cum laude from her mother’s alma mater, Radcliffe. Two books of short fiction followed: The Touching Hand (Houghton Mifflin), in 1967, and The Way It Is Now (Viking), in 1972. (Her rebellious, free-spirited nature provided the model for a character in a novel, The Fume of Poppies, by her Harvard friend Jonathan Kozol.)

Their various accomplishments gave the Binghams a feeling of invulnerability. As Sallie puts it, “The family seemed so blessed, and everything we did seemed to turn to gold. It never occurred to me that there could be a tragedy.”

But tragedy was both twofold and bizarre. In 1964, 21-year-old Jonathan, home at Melcombe after dropping out of Harvard, was electrocuted when he attempted to string lights in an old barn for a reunion of his Cub Scout troop. Two years later, Worth—then 34, married, with two children—took his family on vacation in Nantucket. When his surfboard wouldn’t fit inside the car, Worth rolled down the windows and let it protrude from the sides. The surfboard caught on the edge of a parked car as he drove, swung forward against his neck, and killed him instantly.

In accordance with his parents’ wishes, Barry Jr., the next son in line after Worth, moved over to the paper and a job he may never really have wanted. His new responsibilities set him against the ghosts of his grandfather and brother and in the shadow of his father, who still headed the papers.

In the years just after her brothers’ deaths, Sallie was living in New York and married to Michael Iovenko, a Wall Street attorney. (Earlier, she had been married to A. Whitney Ellsworth, publisher and one of the founders of The New York Review of Books.) At times, she says, she found herself blaming her parents for the way her brothers died. As children of privilege, they had seldom been required to deal with reality. (When Sallie was first learning to type, for example, she rarely changed her own typewriter ribbons, her father insisting that his office workers could do it.) Nor were the children taught much responsibility for their own actions. Jonathan and Worth may have believed, in an unconscious way, that their father would be able to protect them from the consequences of recklessness—even from an early grave—as easily as he might bail drunk reporters out of jail.

Twenty-three years after she left Louisville, in 1977, a year after her second marriage ended, Sallie moved back to live there with her two young sons, Christopher and William Iovenko. (Her eldest son, Barry Bingham Ellsworth, was living in the East.) She was concerned about how her writing career had stalled after its initial promise, but also on her mind was the idea of “resolving some of my basic conflicts with the family, which had not been resolved due to geographical distance:” By this time, she could articulate the feminist feelings she was not consciously able to acknowledge in the 1950s and 1960s, and her analyst had told her she could not “go through life alienated from my family. At some point [my ambivalence about male authority] would have to be resolved.”

A year later, Eleanor, who had gone to college in England and lived in New York and California, also returned to Louisville. Like Barry Jr., she had enjoyed some success in documentary filmmaking. (She produced a controversial film on the Ku Klux Klan—“The New Klan: Heritage of Hate”—which was narrated by Barry Sr., and aired on public television in 1978.) When Eleanor’s small, loosely structured production company did not develop into a profitable concern and she was unable to find a job in network TV, she came home to work at WHAS as Director of Corporate Services. In that wide-ranging community affairs job, she supervised affirmative action for women and minority groups and supervised special projects. But after two years, in 1980, she left the station. One insider says her job had always been poorly defined, and another notes she may have been frustrated at not being able to do hands-on video work. She also had married a Louisville architect and wanted to start a family.

Back in Louisville again—a crucial decade apart in their childhoods—Sallie and Eleanor began to get to know each other. One thing they shared was a concern for women’s role in society, in the family, and in the Bingham companies, where, they sensed, according to Sallie, “that if the ideas came from women, they weren’t [considered] worth anything.” They also shared a discomfort with Barry Jr. For his part, Barry Jr. evidently felt the tension with Sallie most acutely, a feeling that was heightened when, as he points out, she was the only family member to refuse to sign a 1980 stock buy-back agreement designed to keep ownership of the companies wholly in the family. (If any of the family members received an offer for his or her stock from outside the family, the family was to have 60 days to match the offer.)

Sallie describes the resulting tension this way. The so-called family meeting at which the buy-back agreement was presented included 20 management and lawyer types. “These papers were passed out, and we were supposed to sign them and turn them in, just like in school. I’d never even heard of a buy-back agreement, much less laid eyes on one, so I said I wasn’t going to sign it before I got some legal advice. And my mother said, ‘The room is full of lawyers,’ which of course, was true. But if you treat people like fools, they generally react. So what I finally said was that the buy-back agreement seemed to mean that there was some distrust in the family, and if there was distrust, signing this document was not going to erase it. Of course, later I abided by the letter of the buy-back agreement, although I didn’t sign it. So the whole, thing is kind of moot. It’s just that for Barry, anyone who was not marching in step was a big threat.”

In an attempt to ensure continued family commitment to the companies, Barry Sr. had appointed Sallie, Eleanor, his wife, Mary, and Edie Bingham, Barry Jr.’s wife, as voting members of the company boards. Sallie, who had been added to the boards in 1975, says that she and Eleanor asked questions about the promotion and advancement of women and minorities.

Louisville was now a declining factory town. Newspaper costs rose, and circulation began to fall. Profit margins at the papers, according to a story in the New York Times, were below industry standards. (Although the paper collected three more Pulitzer prizes, in 1984 the Courier-Journal failed to make Time magazine’s “10 Best” list for the first time.) Sallie says she felt a responsibility to make sure that economic changes didn’t compromise the papers’ role as a public trust and liberal standard bearer. She became alarmed as the traditionally Democratic papers supported a Republican candidate for mayor. When George Clark was endorsed over his Democratic mayoral opponent, Harvey Sloane, who had previously served a term as a popular and progressive mayor, Sallie wrote a letter to the editor, saying she believed the papers had erred in their choice.

Barry Jr. says the women rarely asked questions, made no significant contributions (“most of them couldn’t read a P & L… and the learning process just didn’t take place”), and, aside from a few memos from Sallie (one in particular questioned the position of a particular editorial on South Africa), seemed disinterested. Sallie was “one of the least contributing members,” her. brother sums up.

There are nonfamily board members and observers to support both sides. Some recall that the women often asked ridiculous questions, showing a lack of business sophistication, and one remembers Sallie often asking questions that showed she hadn’t been paying attention. Others, however, point out that Sallie is correct in saying that the companies do not have an adequate number of women in management positions, but that the papers—which received an award from the National Association of Black Journalists last summer—have one of the best records in the country for hiring racial minorities, in great part because of the efforts of a woman editor who had been essentially “kicked upstairs” to supervise affirmative action.

In 1982, before the real crisis became inevitable, in a move probably designed to further strengthen Sallie’s emotional ties to the companies, chairman of the boards Barry Sr. gave Sallie an office as book editor of the Courier-Journal, the job earlier held by her mother. The new proximity of his sister, who was not only strong-minded and charismatic, but also impetuous like himself, was thought to discomfit Barry Jr. He denies this, saying that he disapproved of the way the position came about. (Shirley Williams, who had held the post for years, was moved to another department.) Sallie’s influence on the book page could be seen in her increased coverage of women authors and use of women reviewers.

In the fall of 1983, Barry Jr. requested that all the women in the family—including his mother—resign from the boards so that he might bring in directors with more business expertise. This action was taken on the advice of outside consultants Barry Jr. had hired —a husband and wife team named Leon and Katy Danco, from the Center for Family Business, in Cleveland—who had come to Louisville to meet with each family member. (Sallie had refused to see them after Katy Danco sent down her book, From the Other Side of the Bed: A Woman Looks at Life in the Family Business. Among the most egregious chapters were those titled “A Boss We Also Sleep With” and “We Make Lousy Directors.”)

Barry Jr.’s request was more like an ultimatum, Sallie says, since he made clear that he would resign if the women did not. All of the Bingham women agreed except Sallie. She was then voted off the boards in March of 1984, an experience she calls “humiliating.” (“60 Minutes” reported that Mary Bingham was in favor of kicking daughter Sallie off the boards, but also that she has been extremely critical of son Barry Jr., too.) Barry Jr. denies that his primary aim was to get rid of Sallie, but Barry Sr. was quoted in the New York Times in support of that verdict: “He felt she would be very critical of him… [that] she would undermine him.” Two of the four new people who subsequently joined the board were women: Carol Goldberg, the chief executive of her family’s New England grocery chain, Stop & Shop, and Barbara Gardner Proctor, a black businesswoman who heads her own Chicago-based advertising agency.

In the winter of 1984, Sallie offered her stock in the Bingham companies for sale to her family, arriving at an asking price of $42 million in March. They refused the offer, and she put the stock on the open market. In July, the family countered with a $25 million proposal. Sallie rejected this offer; a New York investment bank had told Sallie that her stock had a potential worth of $82 million to $92 million.

But Sallie’s shares in the Bingham companies (her equity ownership is estimated at 14.6 percent) were not enough to give an outsider real leverage. Few prospective buyers wanted to be tied up in a family-owned company that was likely to remain family owned for many years to come. After eight months without a sale, Sallie reduced her price to $32 million. The family responded with a $26.3 million offer. After more agonizing, Sallie decided she couldn’t give in.

Meanwhile, now married to Tim Peters, a Louisville building contractor, Sallie felt that she should remain true to the family imperative of putting money back into the community—but with feminist priorities. On her way to the YWCA to swim one day she spotted a woman getting out of a beat-up station wagon with her six-month-old twins and a collapsible double stroller. “She had a baby bottle with her, and she carried it between her teeth by the nipple as she tried to get the stroller set up to cross the street, presumably to go to the Spouse Abuse Center,” Sallie remembers. Later, she walked the corridor of one of Louisville’s largest law firms, and noticed that all the offices with a view belonged to male lawyers, while all the windowless cubicles were occupied by female secretaries.

“It seemed to me,” she says, “that those are the choices women have here—the choice of marriage-dependency-poverty, or the choice of being an accessory to a powerful man, through being his secretary, his wife, his mistress, or by collaborating with him. When I decided to sell out and realized the amount of money involved, I began to think about what I could do to effect some change.”

So, out of her own current income, Sallie set up the Kentucky Foundation for Women to support women in the arts. The foundation will contribute funds to such projects as archives of regional women’s history and a national literary and political quarterly, The American Voice. Sallie also hopes (in tribute to the ironic origin of her own family fortune) to establish the Mary Kenan Flagler Prize, “in honor of my stepgrandmother, who never had the use of her inherited money.”

In the meantime, Eleanor, who was sympathetic to Sal-lie’s position but did not want to alienate her parents, was growing increasingly concerned about her own prospects. She was at home taking care of her young son and expecting a new baby. Partially in response to her expressed interest in the broadcasting side of the business, Barry Jr. announced the stock-swap plan in June, 1985: Eleanor would trade Barry Jr. her stock in the newspapers for his stock in WHAS, thus giving each a majority interest in one of the major companies. Sallie would be bought out. The plan may have been a way of wooing Eleanor away from potential unity with Sallie.

Initially, Eleanor was elated. But soon she was pulled in different directions. As Sallie sees it, if running WHAS was for Eleanor an exciting challenge, she was also “uncertain because she hadn’t done this before.” Her negotiations with Barry Jr. dragged on, neither of them happy with the I progress. Finally, as an alternative, Barry Jr. came up with a second scheme, the so-called Wednesday Plan to sell the broadcast properties and the printing company, and buy out both his sisters. (Sallie would have received $36.4 million, and Eleanor $37 million.) Eleanor, however, preferred the original stock-swap option, as long as the family would give Sallie a fair price for her stock. Eleanor thought Sallie would now settle for $28 million in order to aid her new foundation. Business advisers informed Barry Jr. that the companies could afford to make Sallie a new offer, but he disputed their findings.

Barry Sr. had feared the Wednesday Plan would leave the newspapers financially unstable and vetoed it. Barry Jr. refused further negotiations with Sallie on the price. As his father said, “I think he felt anything more would be a victory for Sallie and a defeat for him.” By that time t he options and tempers were both exhausted.

On January 8, when the old patriarch was only one month away from his 80th birthday, he called Eleanor and Barry Jr. to the house to tell them the properties would be sold. (Barry Sr. planned to talk with Sallie separately. Sallie and her mother had not been on speaking terms for more than a year.) Barry Jr. reacted to the news With rage, accusing his father of making an irrational decision that put his sisters’ interests first, and accusing his sisters of convincing Barry Sr. that his one remaining son was a poor manager.

“In bringing up my children,” Barry Sr. told an interviewer after the decision was made public, “I somehow didn’t manage to get across to them that people have to make compromises.”

And so it was over.

If the companies are sold for the $390 million one estimate says they will bring, Sallie will receive $55.2 million; Eleanor, $55.8 million; Barry Jr.,’$45.6 million (he owns more preferred voting stock but less common stock than his sisters, which is reflected in the dollar value); and Worth’s widow, Joan Bingham, along with her cliildren, will receive $42.9 million. (Upon the deaths of the senior Binghams, each of the four will receive an additional $21.1 million from a family trust.) Most of the major newspaper companies have received prospectuses. If Barry Sr. sells the papers to the highest bidder, the new owner is likely to be Gannett. But Louisville gossip says he prefers the New York Times Co., as being closer to the Courier-Journal’s social, political, and philanthropic tradition. As for Sallie, she hopes for family healing—“once this sale is complete, maybe we’ll find a way”—but. the path may be long.

“It’s so unfortunate that [the family feud] has been so widely misunderstood, and has been turned into a feminist cause, which really is not the point whatsoever,” Barry Bingham, Sr., told a TV reporter recently. But in a larger sense, of course, Barry Sr. may have been the one to miss the point.

The Bingham tradition of supporting equality just failed to include the family.

Alanna Nash, is a Louisville native and formerly worked for the Courier-Journal and WHAS, Inc. She is now a freelance journalist, and her work has appeared in The New York Times, Esquire, and Rolling Stone.

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