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September 4, 1975 To: Participants of The Stelle Group From: Malcolm Carnahan For the Board of Trustees Attached is the transcript
of the special meeting requested by Jim Howery with the Board of Trustees on
Tuesday evening, September 2nd. Also present at Jim’s request were Tom Hood,
Richard Leary, and Stewart Trimble. The meeting had been originally arranged
for the Trustees to meet with Gail Kieninger; she was also present. The transcript is not a
verbatim record of the meeting; it is based upon the shorthand notes of Jeanette
Williams, Corporate Secretary of The Stelle Group. Appendix A, Persons on
Administrative Payroll, Stelle Industries, Inc., is included for your
information and review prior to the Group Meeting planned for tonight at 8:30
P.M. in the Factory. The meeting with Jim and
the others covered two areas—the matter of back pay for persons on an
Administrative Payroll in Stelle Industries and the matter of concern that
Jim and the others expressed to the Trustees in the form of some direct
questions. We trust that our efforts at giving direct responses will be of
help to you in your understanding of the evolution of our thinking in the
last three weeks. I think it is important to keep before the membership the
fact that we take very seriously our responsibility to plan and make
recommendations to the membership. We take equally seriously the fact that
the decisions to accept or reject those recommendations must come from the
membership. Please do not take reports that you may hear about our thinking
and planning as it evolves as reports that decisions have been made by the
Trustees without a referendum vote. Obviously, there are some areas that the
Trustees will act on which we view as being within the authority of the
Trustees. However, even those areas can be called into question and review by
the membership by using Article II, Section 6, of the By-Laws: Rights of Petition and Criticism. Malcolm R. Carnahan President MRC/jw MINUTES OF MEETING BETWEEN
BOARD OF TRUSTEES OF THE STELLE GROUP AND JAMES E. HOWERY, GALL A. KIENINGER,
THOMAS L. HOOD, RICHARD J. LEARY, AND STEWART A. TRIMBLE - AT THE BOARD
ROOM, FACTORY NO. 1, STELLE, ILLINOIS, ON SEPTEMBER 2, 1975, AT 8:00 P.M. Malcolm Carnahan, President of The
Stelle Group, stated that he first wanted to discuss a matter of serious
import of which he had just become aware and that he felt Stewart Trimble
should be asked to leave the room while that matter was discussed since
Stewart was not involved in the situation. This was agreed upon by the other
persons present, and Stewart left the room. James Howery and Gail Kieninger then
expressed that they had come here to meet with the Board of Trustees to
discuss certain matters and had not come for the purpose of any other type of
discussion. Malcolm responded that he did not feel
it would even be appropriate to discuss Admissions at this time until this
other matter was resolved. He said it was brought to his attention that there
might be some irregularities in the Stelle Industries, Inc. payroll
(amounting to over $15,000), that he had asked Rick Thorn for the payroll
records of the persons who were on the Stelle Industries, Inc. administrative
payroll, and had mentioned this to Tom Hood. Apparently the persons on the
administrative payroll were granted and paid back wages for the six months
prior to the week preceding the resignations (of James Howery as president
and director, Thomas Hood as director, and Helen Kedzierski as corporate
secretary at the August 12, 1975, Special Meeting of The Stelle Group). James
Howery said that is partially correct, that the payment of back wages was
based on an agreement in February that raises would be given out to people in
the shop, which was done, but that the administration would defer their raises
because the corporation couldn’t handle it at that time. He said it was money
due them by verbal agreement between the parties involved at the time. He
said everybody else had gotten raises but these administrative personnel
elected not to take them at that time. Richard Leary said he did not feel he
needed it in February so it was held back as something to be paid later.
James Howery asked in what respect that could be called an irregularity. Malcolm Carnahan said he wanted to
review the situation, that some of the salaries seemed out of line with other
Stelle wages. Tom Hood said those were the people who
were producing results for the corporation, and that he didn’t think you
would find the salaries out of line for those kind of jobs. Richard Leary said the salaries were
commensurate with the responsibilities accepted by these persons. Malcolm Carnahan said he understood
that Gail had received some back salary from The Stelle Group in the same
week as the above mentioned salaries were paid. Gail said yes, she had
received back salary but that it was less than she had received last year
because The Stelle Group is paying the rent on her residence, and that she
had not received a raise but only back salary and that from that point on she
was off the payroll. (Gail received a check for $3,510 on August 12, 1975.) Tom Hood pointed out that the checks
were written before we were contacted by the Wage and Hour people. John Alexander asked what percentage of
increase had been given. Tom Hood said he went from $145 to $245
per week. He said a person in his position is worth that, and that a person
in Malcolm’s position is worth that much. Walter Cox asked why the increase took
place at that time. James Howery (whose salary was raised
from $125 to $317 per week) said that he was due that much from putting in
approximately 70 hours per week. He said that, frankly, the reason the checks
were written at that time was that he knew he would be resigning and he
wanted to be sure people got the money they deserved. Malcolm Carnahan said he would like to
finally ask that each of the persons who received the raise give him a
written statement as to why he feels he deserved the raise. Tom Flood and
James Howery said they did not think they would provide such a statement. Malcolm said he really was not in any
mood to discuss anything else at this time until this matter is resolved.
Richard Leary asked what has to be resolved. James Howery suggested that the
Trustees discuss his questions because if the Trustees did not, he and others
would have to assume that all of the Trustees’ answers are negative and would
have to take the appropriate actions. Malcolm Carnahan said that what may
seem like a simple, rational action on these individuals’ part creates
tremendous problems for himself as an individual and he thinks it will also
create problems for the membership, that he does not think the membership
will accept their explanation for the raises and back pay, that they are
going to have some difficulties just with the membership and we do not know
at this time what the legal implications are. James Howery said how could the
Trustees be concerned with $15,000 when they are willing to give away $40,000
and $15,000 (the implication being settlements with the Putts and Popkins in
paying for their houses) and pay off Richard Kieninger’s blackmail. Tom Hood said that the potentialities
of Stelle Industries, Inc. that were inherited by Malcolm when he took over
Stelle Industries, Inc. far exceed the value of the $15,000. Malcolm said he did not think
discussion of other matters is relevant now. Jim Howery said these matters
have a great deal of relevance for this week, that the matter of the salaries
do not have any relevance except in our heads. Tom Hood said to go ahead and
make whatever we want to make out of the matter, but that there are questions
of people who presently work here now that are to be answered. Jim Howery said he did not want to get
into a lot of discussion, but that he just wanted to find out where the Trustees
are coming from, what their intentions are, etc. It was then agreed that the Trustees
would simply answer the questions but would not get involved in discussion. Tom Hood said it is interesting that
the salary level found offensive is one that Malcolm recently agreed to (as
President of The Stelle Group and Stelle Industries, Inc.). Malcolm said he
thought there were some basic salary guides agreed to in Stelle relating to
married people and single people, etc. Gail said that agreement related only
to members of the Board of Trustees. The following questions were then asked
of the Board of Trustees, and their responses given: J. HOWERY: It was my
understanding that your intent is to put Admissions under The Stelle Group? M. CARNAHAN: That is correct—if the
membership will agree. J. HOWERY: It is also your intent to have
Gail Kieninger out of Admissions and not active in Admissions? M. CARNAHAN: No, that was not the intent.
The intent was that whoever would serve on Admissions must be elected. The
majority of the Trustees could not recommend her to that position. J. HOWERY: Since that job and the
responsibility was delegated and was not under The Stelle Group, by what
authority do the Trustees assume to place it under The Stelle Group? W. COX: We do not assume the authority; we intend to solicit
it from the membership. We do not accept the premise that the Admissions
Committee is a delegated position. J. HOWERY: Is this a unanimous position of
the Trustees? M. CARNAHAN: It is an almost unanimous position of the
Trustees. J. HOWERY: In essence what you are saying is that it is okay
to have quality control under the production manager. R. LEARY: Where does it come that the group has that
authority? W. COX: We do not intend to enter into
discussion. J. HOWERY: Have you made any promises in
your efforts to gain office with people who are participants in order to get
their votes, such as individuals who were no longer participants would be
allowed to return or would be returned to The Stelle Group because there
would be a new Admissions Committee? M. CARNAHAN: No. J. HOWERY: Is it your intent that
nonresidents, provisionals, and associates have the same rights as members? TRUSTEES: No. J. HOWERY/G. KIENINGER: What about the right
to appeal associateship? W. COX: That is different. The structure of the hearing is
different and the odds against the decision of the committee being reversed
is considerably greater. J. HOWERY: With regard to the Orientation Classes, I
understand that there was a statement made by the Trustees at the meeting
last week (Information Sharing Meeting, August 29) that the Trustees would
meet with Gail Kieninger to select instructors or persons who would be
trained. TRUSTEES: No, that was not said. J. ALEXANDER: My
recollection was that we would be meeting with the people we would be asking
to teach the Orientation Seminars with regard to the revisions to be made in
the material. The only reference made would be to additional people. M. CARNAHAN: Did you
discuss the concept of co-teachers that night? J. ALEXANDER: No, I don’t
think so. S. TRIMBLE: What kind of
mandate do you consider you received from the vote of 40 to 14 at the
meeting-is that going to be proposed as an alternate to be voted upon? M. CARNAHAN: No, because
part of the thing that was determined was that the membership did not want
the Trustees to be involved in appointing the persons on the Admissions
Committee. The problem was that there was tremendous confusion at the time
and I take responsibility for that. Since that time we have had at least five
persons who wanted to change their vote. Regardless, we told Gail when we met
with her that whatever was done would have to be in the by-laws. That was
also assumed by Joanna in making her proposal, that it would be voted upon.
The second assumption was that Gail and the Trustees would agree on people,
and I already stated that we cannot agree on the first premise—recommending
Gail. This does not rule out her being elected. Whatever the majority of the
membership decides, that is what would happen. J. HOWERY: Is it accurate
that Walter Cox, Kurt Raillard, Marjorie Kunkle, Ray Evans, and David Berry
are going to be instructing or assisting instructing in the Orientation
Classes? And being trained as teachers? J. ALEXANDER: They are
people who I asked—along with Charles Bowen. W. COX: “Co”-teacher does
not imply trainee but is to differentiate which teacher is the dominant one. J. HOWERY: Is it your
intention to have a committee function at the monthly meeting in Chicago
fielding questions? M. CARNAHAN: The
intention is that there would be a panel—two or three people at least. What
we communicated to Gail is that she would serve along with two or three of
the Trustees. G. KIENINGER: I said I
would not do that. W. COX: You chose not to
serve. G. KIENINGER: No, I chose
to let you make the decision. J. HOWERY: I would like
to know if any of the Trustees would allow Richard Kieninger back into The
Stelle Group. J. WILLIAMS: We can’t
“allow” him. No person can. J. HOWERY: I mean via
Admissions? J. WILLIAMS: That would
put Admissions above the judicial system that we have here at Stelle. J. ALEXANDER: I indicated
I would not want Richard Kieninger to return to the group—unless it was under
certain kinds of decisions. At some point in time we may be at a point where
he could return to The Stelle Group. W. COX: I would like to
extend the statement I made to you (J. Howery) right after Richard was expelled,
and that was that I would not impose him on the community, that I would not
have him as a guest in my home. 1 have gone to see him on business and to
clarify his role in the Brotherhoods’ Plan. At this time I do not think it
would be appropriate for him to be in Stelle. I would not further any attempt
to bring him back to Stelle. I think that if that is to be the result, he
will have to bring it about after working out his own problems. He is free to
work out his problems and to better himself to the point where his
participation is appropriate; and he would have to come in through the front
door and not through any back door. An Admissions Committee would not have
the authority to admit him over the expulsion; I am not sure what would be
required. J. HOWERY: You said you
have not had Richard in your home. Are you aware that his car was seen on the
site and him walking toward your house on one occasion? And that he was heard
speaking in your foyer on two occasions? W. COX: Richard Kieninger
has never visited me here since the expulsion. Never has he been in my foyer
since that time. Whoever made those statements is either lying or badly
mistaken. I have heard these statements before but have not responded to them
because they were such gross fabrications. I respond to them now because you
ask their directly, but they are not true. J. HOWERY: Would you
allow Richard Kieninger to return here as an emissary and not as a member? W. COX: Again I would
have to relate to what I said earlier—his own appropriateness will determine
his participation. At this time his resentfulness and bitterness toward
certain people do not make it appropriate for him to be here. As I told you,
I spend most of my time talking to you defending Richard and most of my time
talking to Richard defending you. I think you both have abilities and both
have faults. I would not on the basis of Richard’s saying he is an emissary
allow him in Stelle. He would have to prove himself as such over a long
period of time before he could be considered. J. HOWERY: Relating to
the money situation, I made an assumption. Is it your intention to pay the
Popkins out of court the amount they requested, and to pay the Putts for
whatever they contributed to The Stelle Group and Stelle Industries, Inc.? M. CARNAHAN: No. In the
case of the Putts, it is my intention to settle with them for the amount they
put into the house. J. HOWERY: Popkins? M. CARNAHAN: They have
asked for $25,000 for what they put into their house plus interest and the
$25,000 damages. It would not be my intention to try to negotiate for any
amount over the $25,000 plus interest—and hopefully for less. J. HOWERY: I thought if
my memory was correct it was $15,000 in cash and the rest in donations. But
it is your intention to pay them what they contributed to Stelle Industries? M. CARNAHAN: Toward their house. R LEARY: If they haven’t
contributed anything toward a house --? J. HOWERY: That’s not
where he is coming from. M. CARNAHAN: We don’t
know where they are yet. I have asked Merrilie to talk to Attorney Stodd. I
haven’t personally had the opportunity to look into the agreements involved
yet. J. HOWERY: What is your
reasoning behind settling this suit and the Putts suit? M. CARNAHAN: Well, in the
case of the Putts you have a situation where they were associates and to make
a major investment in Stelle Industries, Inc. without an opportunity to have
at least a full review of the situation—to be dissociated without an
opportunity for a hearing—it seems to me puts that in a special kind of
category. It seems to me that no associate should be able to invest large
amounts of money in Stelle Industries, Inc. until they are a member. A loan
maybe, but not a large investment; then we could avoid this problem in the
future. On Popkins it is less clear because I still don’t know the facts
surrounding their situation. My impressions is that—were they ever full
members? (Gail: No, they were associates)—since they were associates I feel
it is kind of the same situation. G. KIENINGER: They
resigned on their own. J. HOWERY: Have you ever
entertained the thought that if Stelle Industries, Inc. purchased back the
house from Putts and paid Popkins back for the money they invested in Stelle
Industries, Inc. that that might open the door to private ownership in
Stelle? M. CARNAHAN: No, I have
not. I have entertained the thought of developing some sort of mechanism like
a cooperative where an individual can own shares, but he does not own the
dwelling unit. T. HOOD: Those shares are
tradeable on the open market. M. CARNAHAN: There is a
provision, I think, where you can put on the shares the first right of
refusal by the coop, which would mean that the coop would have the right to
first right of refusal. In this way we would not have a family restrained
here who was no longer interested because of lack of resources—and that could
happen if you had a full member under the present situation; you couldn’t get
him to leave. W. COX: Nothing has been
resolved in this area yet. I. HOWERY: Is it the
intention of the Trustees to pay off Richard Kieninger out of court? M. CARNAHAN: In terms of
legal fees we have asked for a copy of the invoice for his legal fees in this
matter. Because I asked him on Saturday if he would agree to sign the releasing
“covenant not to sue,” and he said he would not, it is now my intention to
ask some private individuals to pay that rather than pay it out of Stelle
Industries, lnc. because of the objections that were made. J. HOWERY: Where does
that decision come from? Without the agreement of all the parties involved
(the other defendants) it is. an implication of guilt through a willingness
to settle out of court. M. CARNAHAN: I don’t know
how it is an implication of guilt. The suit was dropped, not settled. J. HOWERY: It is being
dropped and he is getting some other side benefits W. COX: I think more
accurately it is being dropped because he doesn’t want to jeopardize Stelle
Industries, Inc.’s capacity to get a loan at this time. R. LEARY: Why did he start
the suit? W. COX: That is all
explained in more detail in the letter posted on the bulletin board in
response to David Cysewski’s letter. J. HOWERY: I want to let
you know where I am personally coming from. On April 1, 1974, Richard
Kieninger assigned the responsibility to two people (J. Howery and G.
Kieninger) and it was accepted by those two people. Lest there be any
confusion concerning the resignations of administrative positions being a
relinquishing of responsibility, it is not so. I still feel I carry
responsibility that was delegated, and that is there. As I told you, I
suggested and requested among people who supported the old Trustees that they
support the new Trustees as best they could but that they did not have to
compromise their principles in any way. We are in areas now where we are
being asked to compromise our principles—in Admissions, Orientation Classes,
and the Public Meeting in Chicago—that is beginning to happen. The other area
is that, even though it be a minority that feel this way compared to a great
majority that feels the other way—and I am referring to Stelle being a city
government, referendum, etc., as compared to being a school—what is being
stated by the Trustees is what appears to be an attempt to say that their view
is the only concept here and that everyone believes that way by the panel
going up and making their statements (implication the Chicago Public Meeting)
and the Orientations; that come hell or high water you will have a
municipality and it will become an open city. Many of us believe that is a
lowering of the standards many of us feel they came here for. I don’t
personally feel I can ask these people to cooperate. J. CARNAHAN: I would not
expect anybody to compromise a fundamental principle. I hope there is some
way to work out something that will be acceptable to everyone. I had hoped we
could draw our images closer-together. If not, I don’t know. J. HOWERY: I have not
seen them getting any closer together. M. CARNAHAN: I agree.
From the beginning we have been committed to whatever approach we took would
be submitted to a vote and whoever was put into a position in Admissions
would be appointed by the Trustees or the membership. The sense I got was
that the membership did not want them to be appointed. There are those who
feel Gail should be in the Admissions position. My understanding is that even
when the Elder Brothers submitted the ten Lemurian Laws on the Plains they
still asked the membership to vote on it. So if Gail feels she has some
authority, then she should submit it to a vote. If so, these laws you have
been talking about will work and she will surely be elected. J. HOWERY: The Stelle
Group existed with an Admissions Committee before most of us became members. J. ALEXANDER: When I came
to The Stelle Group after reading The Ultimate Frontier I made the
assumption and I agreed to the concept of Richard Kieninger having direct
contact with Higher Beings. I assumed that as being a valid situation.
Yesterday Gail Kieninger had some discussion with regard to perhaps her
having that same kind of contact. In my view if The Stelle Group is going to
be presenting to the world that now Richard Kieninger is no longer here and
we have someone else who now has that kind of a contact and has a special situation
outside of The Stelle Group—and I had always assumed that Admissions was part
of The Stelle Group, which was apparently an error on my part—if we are going
to be saying that Richard Kieninger is no longer here and Gail Kieninger now
has some kind of contact and this is going to be the position we present to
the rest of the world—to me this is a different situation, as I perceived
these kinds of contacts, and I think the membership should be exposed to this
and at least have a chance to vote whether they do support this concept. J. HOWERY: First of all, you are making the assumption that someone
is going around making statements that this is happening. W. COX: Have we answered
all your questions? I believe we are just getting into discussion now. (As the individuals leave the room) M. CARNAHAN: Tom, would
you please give me a report for the basis of what occurred in February—what
the payscales were by which some people were given raises and by which it was
decided not to give other people raises T. HOOD: You already had the answer from Jim Howery. it is in the
minutes, I assume. The meeting adjourned. Jeanette Williams Secretary APPENDIX A
PERSONS ON ADMINISTRATIVE PAYROLL STELLE INDUSTRIES, INC. Gross Pay for Jan.
1975 Feb. 1975 Aug. 3-10, 1975 Back Wages Aug.
11 - 17 NAME Weekly
Pay Weekly Pay Weekly Pay 2/3/75 to 8/3/75 Weekly Pay Jim Howery $
125.00 $ 125.00 $ 317.3 $ 5000.06 Resigned Tom Hood 130.00 145.00 288.46 3,729.96 245.00 Richard Leary 130.00 145.00 230.77 2,230.02 230.77 Helen Kedzierski 95.00 96.00 129.81 879.06 109.50 (120.00
8/18-24) Fredric Kleinberg 102.06 130.00 230.77 2,230.02 Resigned Charles Roehm 160.00 175.00 175.00 None 175.00 Richard Thom 165.00 175.00 242.88 1,764.62 225.00 Total $15,833.74 Typical Manager’s Salary $ 130.00 $ 145.00 $ 145.00 None $ 145.00 Typical Worker’s Salary $ 105.00 $ 120.00 $ 120.00 None $ 120.00 |
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