McMillen-owned firm dropped his name before bankruptcy

October 13, 1992|By William Thompson and William F. Zorzi Jr. | William Thompson and William F. Zorzi Jr.,Staff Writers

A firm named after Maryland Congressman Tom McMillen and largely owned by him quietly changed its name last month just before filing for bankruptcy.

The company, which leases and sells paging devices, had been called McMillen Communications Corp. since it was founded by Mr. McMillen in 1981. It changed its name to Pager Communication Corp. on Sept. 18. The same day, Pager Communication filed for bankruptcy in a federal court in Virginia.

Several disgruntled investors have charged that the unannounced and last-minute name change was designed to shield Mr. McMillen, who is running for re-election, from the potential political embarrassment of being closely associated with a failing business.

"I think McMillen is trying to keep this hidden until the election passes," Paul Jones, an Easton lawyer and investor in the firm, told the Star-Democrat newspaper.

Two other investors who complained to The Sun asked not to be identified.

Mr. McMillen, who was elected to Congress from the state's 4th District, is running for re-election against Rep. Wayne T. Gilchrest, the Republican incumbent, in a tight race in hTC Maryland's newly drawn 1st District. Both Mr. McMillen and a company director have dismissed suggestions that the change of name was aimed at protecting the congressman, saying that the firm's officers had intended to change the corporate title for months.

The company director, who also asked not to be identified, said the decision to change the name was made by the board of directors without consulting the congressman. "We had planned to change the name of the corporation for some time," he said this week. "I didn't ask McMillen about it. We told him afterwards."

He called allegations that the name change was designed to protect Mr. McMillen "vindictive, vicious and possibly political." And he added, "There's no big sinister deal in all this."

Mr. McMillen, in a prepared statement issued by campaign manager Brad Fitch, concurred. "The decisions related to the company are ultimately made by the board of directors," the statement read. "I was informed of the decision to change the name of the company after the board decided to do it."

Mr. McMillen has said he ceased following the firm's day-to-day activities when he was first elected in 1986 and that he resigned from the company board of directors in 1989. But bankruptcy papers for Pager Communication identify Mr. McMillen as a director.

A related company, American Beeper Associates, which is owned by Mr. McMillen and 27 others, also filed Chapter 11 bankruptcy papers Sept. 18 in the Alexandria federal court. The two companies are reported in court documents to have no assets. They listed combined liabilities of nearly $600,000. Both have offices at the same address in Columbia.

The partnership has been in financial difficulty for some time. Officers have blamed their losses on intense competition and said an independent management firm hired to oversee operations did a poor job.

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