Two of the candidates in Minnesota's 6th Congressional District are turning corporate ethics into a major theme of the campaign. Republican Congressman Mark Kennedy and DFL challenger Janet Robert both say their opponent is soft on corporate responsibility and that they're the candidate who would best represent employees and shareholders.
Both DFLer Janet Robert and Republican Congressman Mark Kennedy come from corporate backgrounds. So, with business scandals making headlines daily, business ethics was bound to become an issue in the campaign.
Kennedy, who's a freshman congressman, worked as chief financial officer for Department 56, CEO for Shopko Stores and an accountant for Arthur Anderson before his election.
Robert, a former Oak Park Heights city councilwoman, is an attorney and sits on the board of directors of her family's St. Louis-based private company, Siegel-Robert Inc.
The Robert campaign says Kennedy has been soft on proposals in Congress that would strengthen laws against corporate malfeasance. She also alleges in a recent TV ad that Kennedy's action as CFO of Department 56 cost shareholders money. A shareholders lawsuit focuses on the company's computer switch in 1999 which caused duplicate shipments, lost customer orders and caused inadequate billing.
Kennedy held a news conference almost as soon as Robert's ad hit the airwaves saying the allegations are false and misleading. He says his name was initially removed from a shareholder lawsuit. The judge later dismissed the entire lawsuit as "groundless."
Kennedy says the real culprit in Department 56's software problems is consulting firm Arthur Anderson, which settled a lawsuit with Department 56 for $11 million dollars earlier this year.
"I would like to reiterate that I have never gotten rich off of Department 56 stock. I have never exercised a Department 56 option and my options have now expired. I have never sold a Department 56 share and the shares that I have bought with my own money that I continue to own," Kennedy said.
Kennedy says Robert is running the ad to take attention away from her own corporate accountability problems. Robert and several family members sit on the board of her family's privately held company, Siegel-Robert Inc.
A federal judge and an appeals court ruled that the board unfairly forced minority shareholders to take the stock at a low price. The court also awarded shareholders an additional $22 million for their stock. The Kennedy campaign responded to Robert's ad with an ad of its own.
Robert says the Kennedy ad is not factually correct. She says the judge never found that the board "cheated" shareholders and that she never hid the lawsuits from anyone. She alleges that Kennedy's situation at Department 56 is different because the judge never let shareholders quote "have their day in court."
"There's a big difference. This company Siegel-Robert has done very well. The shareholders got a lot of value, their stocks went up. The shareholders in Department 56 lost a lot of money," she said.
University of Minnesota political science professor Larry Jacobs says corporate accountability is an important issue in many races nationwide. However, he says Robert takes a risk in bringing the issue up.
"Someone who's running a campaign on the importance of corporate responsibility and new ethics of corporate behavior should be beyond reproach in her terms of her own behavior. The evidence that we've seen suggests that there are at least questions in that regard in Janet Robert's past behavior," Jacobs says.
Neither candidate has addressed how they would improve the corporate climate if elected. Kennedy says he voted for a number of corporate accountability bills that would get tougher on corporate crime.
Independence Party candidate Dan Becker, a St. Cloud drug counselor, says he's pleased that the other two candidates are attacking each other and not him on the issue. In fact, he's surprised the other two candidates have the time to gather information on each other.
"The information that that have been able to dig up on each other, to me is amazing in a way. Where do they have time? I'm busy with my campaign and doing the things that I'm doing. I honestly don't have five minutes to try to look up what either one of them did in the past so I don't know where they find the time," he said.
Becker says the negative attacks between Kennedy and Robert may help him at the polls. Minnesota's 6th Congressional District runs from St. Cloud into the northern Twin Cities suburbs and east to Stillwater.More from MPR