Pilkington says legal issues gave it an edge

The May 10, 1993, removal of former L-O-F President Ronald Skeddle and former executive vice presidents Darryl Costin and Edward Bryant was acknowledged a day later by the glassmaker’s British parent, Pilkington PLC.The company didn’t, however, reveal the extent of the allegations against the former executives.

Yet, in the next couple of years, details on how the trio allegedly defrauded the glassmaker of $14 million unfolded in civil and criminal proceedings. They were acquitted of every major charge. They emerged from the scandal virtually unscathed legally, but the events remain fresh in some people’s minds.

For its part, Pilkington acknowledges management had to devote time to dealing with legal instead of business issues in North America, where operations were restructured as the courtroom battles wound down.

As a result of the legal wranglings, Pilkington has been ahead of other companies on issues concerning corporate governance, said spokesman Roberta Steedman.

"We believe Pilkington has come through this chapter as a stronger company," she said yesterday.

Making Pilkington’s North American operations stronger was at the root of the problem 10 years ago.

Pilkington was urging L-O-F executives to cut costs and increase profits, and some work that had been done by company employees was contracted out to other firms.

The trouble for Pilkington and the government was that Mr. Skeddle, Mr. Costin, and Mr. Bryant secretly were behind companies that got some of the work done under contract.

From 1990 to 1993, according to allegations, the trio gained control of natural-gas wells owned by L-O-F and won contracts to provide data-processing services and mechanical robots through companies they and others set up.

The three men conceded they hid their ownership stakes in the companies from their superiors but denied wrongdoing, maintaining they acted on legal advice.

Plus, they said, the savings to L-O-F outweighed their profits from the deals.

A 274-count criminal indictment against them - which was said to be the largest issued here - was whittled down to 20 counts by the time a three-month jury trial was over. Mr. Skeddle, Mr. Costin, Mr. Bryant, and five people who hadn’t been employed by L-O-F were acquitted in 1997 of charges of defrauding the company.

A civil fraud case Pilkington waged against the trio was dismissed in 2000 after an undisclosed settlement was reached.

Mr. Skeddle, meanwhile, has been chief executive of a Toledo company, Global Growth Group, and Mr. Costin has received several patents and has moved to Westlake, Ohio, where he has been with a laser technology company. Mr. Bryant’s activities since he left L-O-F are not known.