Failed shop at crux of Hartman-Pompeo feud

The tension between frontrunners for the Republican nomination in Kansas' 4th Congressional District ratcheted even higher Wednesday as the Mike Pompeo and Wink Hartman campaigns dueled over a Hartman ad claiming Pompeo ran a small machine shop out of business.

Wednesday morning, Pompeo called a news conference where he called the ad "a fraud" and challenged Hartman to either prove it or pull it.

Wednesday night, the Hartman campaign produced accounting documents from the defunct shop, Machining Concepts, showing that Thayer Aerospace made late, and in some cases reduced, payments in 2003.

Pompeo was chief executive of Thayer at the time.

The documents did not show whether Thayer owed money to Machining Concepts when it folded near the end of that year.

The campaign commercial at issue surfaced Tuesday night and features Daniel Lind, the former owner of Machining Concepts. Lind was not identified to viewers.

"Pompeo's business practice forced me to declare bankruptcy, lay off all my employees and to lose benefits," Lind says, looking into the camera. "Mike Pompeo promised to pay me and didn't. You can't trust what he says."

Josh Wells, a spokesman for the Pompeo campaign, said he finds it suspect that the Hartman campaign could not immediately produce conclusive, written proof of Lind's assertions.

"They're on TV saying Mike Pompeo ruined this guy's life," Wells said. "The burden of proof is in their court. Mike Pompeo did not force this man to file bankruptcy."

Machine shop's woes

In a recent interview with The Eagle, Lind said he used to deliver loads of bell cranks, a little piece that helps pivot moving rods in airplanes, to Thayer while Pompeo was its leader.

But after 9/11, Lind said, Thayer's payments began coming late.

Lind said he tried to understand that Thayer was like other aviation companies suffering the economic downturn.

He said he negotiated with the IRS to temporarily forgo payroll taxes while he awaited payments from Thayer, which was about a third of Lind's business.

Lind said he couldn't afford to sue Thayer for nonpayment.

Time passed. Four other companies that Lind's company supplied also closed.

Then the IRS called to tell Lind his time was up and he owed his payroll tax for his three employees — including what he owed while the IRS cut him a break.

Lind said it forced his company to fold.

At his news conference, Pompeo said Machining Concepts performed about $351,000 worth of work for Thayer over about three years.

"All of the obligations associated with that work were paid for by Thayer Aerospace," he said.

By late Wednesday, the question was more one of when payments were made.

Pompeo didn't directly respond when asked if his company paid Lind on time.

The documents provided by the Hartman campaign and federal court records obtained by The Eagle showed that Machining Concepts turned over at least some of its accounts receivable — representing money owed to the business — to a bank after its owner filed for bankruptcy.

That appeared to undercut a key piece of evidence the Pompeo campaign had provided to support its contention that Machining Concepts was paid and the Hartman ad was a hoax.

The original bankruptcy filing by Lind and his wife showed no accounts receivable among their assets.

Pompeo said that proved Thayer didn't owe Machining Concepts any money at that point.

But a letter from the Linds' lawyer dated March 8, 2004, about six weeks after the bankruptcy was filed, informed them that "the receivables appear to belong to the bank."

An April 12 court filing from the bank indicated that the Linds turned some receivables over, although it was unclear when exactly that happened.

Who got payments?

Pompeo said the ad was inaccurate and a desperate move by a failing campaign.

The Hartman campaign stood by the ad.

"They flat out didn't pay him (Lind)," campaign manager Scott Paradise said.

It could not be determined from documents available Wednesday whether Thayer paid Machining Concepts, or paid the bank after the bank took the company's receivables.

"If they ended up paying the bank, that's fine and good," Paradise said. "But that doesn't change the fact that Daniel Lind lost his company, lost his employees and lost his paycheck."

The allegation that Thayer Aerospace didn't pay some suppliers during a period when Pompeo was in charge of the company comes as the Pompeo campaign is turning up the heat on Hartman over his 1987 bankruptcy, which followed the failure of his Hartman Homes construction business.

Pompeo acknowledged that Thayer went through tough times during the downturn in aviation that followed the Sept. 11, 2001, terrorist attacks.

"When times got tough, we did not file bankruptcy," he said. "We fought through it. We worked with our business partners, we worked with our shareholders, we worked with our lenders and our employees and our customers to make sure that Thayer Aerospace continued to be a growing thriving business right here in south-central Kansas.

"The same cannot be said for Mr. Hartman. When times got tough for Mr. Hartman, he placed his business into bankruptcy and left unsecured creditors with nothing."

Pompeo's campaign passed out manila envelops with an e-mail from Glenn Steele, chief operating officer of Thayer Aerospace Manufacturing (now known as Nex-Tech Aerospace), that says "all legitimate claims have been paid to all of our suppliers."

Another e-mail from Steve Becker, chief financial officer of Kice Industries, who was Thayer's controller from April 2001 to January 2005, said all suppliers were paid while he was there.

But Lind blames Thayer — under Pompeo's leadership — for his company's downfall.

Lind said he's upset with Pompeo for two reasons. "One: If he was aware of what was going on, he made the decision to screw my company," Lind said. "Two: If he wasn't aware, the people beneath him were out of control and he didn't manage them."

This story was originally published July 22, 2010 at 12:00 AM with the headline "Failed shop at crux of Hartman-Pompeo feud."