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May 8th, 2009
04:38 PM ET

Suitmaker to the President in Jeopardy

Ever notice President Barack Obama’s tailored suits? A lot of people have admired their stylish high quality. The company that makes some of them is Hart Schaffner Marx in Mr. Obama's hometown, Chicago. Chicagoans just call it Hartmarx. It’s been around for 120 years and is the largest men’s suit company still operating in the country.

Well, recently the recession caught up with Hartmarx. Hoping to save itself by restructuring, in January it filed for Chapter 11 bankruptcy. Wells Fargo, the company’s biggest creditor, was said to be considering selling Hartmarx to a company that would liquidate it, even though there were at least two other prospective buyers who wanted to keep the company running.

Union workers at Hartmarx are furious that Wells Fargo would even consider selling the iconic, hometown company to a company that would shut it down. The union and even the state of Illinois are pushing back against Wells Fargo. State treasurer Alexi Giannoulias fired off a letter to Wells Fargo CEO John Stumpf, threatening to take its $8 billion portfolio away from Wells Fargo if the bank backs putting Hartmarx out of business.

Giannoulias is outraged that Wells Fargo got $25 billion in federal TARP bailout money and now might put people out of work. Giannoulias says Wells Fargo has an obligation to use TARP funds to preserve American jobs, not shut down U.S. companies. I spoke with Giannoulias about his hardball tactics against Wells Fargo.

Wells Fargo issued the following statement: "We empathize with the employees and communities affected by decisions made by Hartmarx. However, these are internal business matters that Hartmarx is deciding on, as Hartmarx explores its options in the bankruptcy process. Beyond that, we cannot comment further because our customer relationships are confidential. We work with our commercial customers who experience financial difficulties whenever circumstances prudently permit it. We want them to stay in business so we can earn all of their business and help them succeed financially."

Giannoulias says he’s planning to talk to Wells Fargo this weekend. We will follow up with any new developments on the story. What do you think? Post your comments below.

Filed under: Don Lemon
soundoff (7 Responses)
  1. michael armstrong sr.

    O lord we cant have the president dressing wrong hes got to look presidential like no hats with a picthure of beavis on it saying ha ha ha this sucks . boy what an boring bunch of people whats wrong with a little humanity in the way the president dresses just let the guy dress the way he wants to and let the cnn news groop dress the way they want to you let the ladys do it why not the guys do you realize how uncomfertable a suite is its like wearing a hangs man noose and the collars nothing but a sweat band so whats wrong with alittle cool in our dess groove be kind to men loosen up the attire.

    May 8, 2009 at 6:34 pm |
  2. Ginny

    I would like to see Wells Fargo file Chapter 11. It would be different if there was no other option. If two other parties are interested, I would think something could be arranged. Seeing how the banks treat citizens, who are under water on their home mtgs. I guess I should not be surprised. I will be closing my account with Wells Fargo and start using the local small town bank

    May 8, 2009 at 7:01 pm |
  3. Helle v. Schweitz

    I have a good Bank story. I made a mistake in my check book and Suntrust Bank in Lutz, FL charged me $70 fine for the 2 checks they covered. It was MY fault, BUTdid that really hurt , as I am 65 and not pulling in a whole lot of money working part time. I wrote a nice letter, appologizing and asking if we could share the cost? After 2 months (and me giving up hearing from them) i received a credit today 0f $35. I will stay with Suntrust forever and now write a BIG thank you. Helle

    May 9, 2009 at 6:30 pm |
  4. Braunsugar55

    We need more city and state offical to stand-up to big business,and say enough is enough.

    May 11, 2009 at 8:59 pm |
  5. Jim

    Finally, I've heard the words do whats right save jobs. I realize that Wells has to protect its stockholders and I agree with Alexi that we have the right to withhold funds from going to a bank that would not help a good company stay the course and not go over seas.
    I'm am sure Alexi can negotiate a deal that can save HS&M and Wells can keep the states money. Hard Ball some times puts people in corners that are hard to escape from.

    May 12, 2009 at 4:00 pm |
  6. jan kirkconnell

    No, Don, it's not racial. Pres. Obama has not been transparent, dignified, honest, 'presidential,' etc., and it's about him as a human being, not the whiny race card thing. When he 1st started his campaign, I signed up for his mailing list. I thought he was a promising candidate. As I learned about his abortion stance, his audacity to say he didn't know what kind of person Rev. Wright is, (after reamining in the church for 20 years) the outright whack-jobs he has appointed as czars, the whole idea of rushing thru the stimulus & the atempt to run thru health care before the Auguts recess, just to name a few, His apology tour, I can't stress enough, if this was a white man, he would have been impeached already.

    September 12, 2009 at 7:12 pm |
  7. jan kirkconnell

    Dear Don
    One more thing, President Obama doesn't respect the office of president, why should anyone else??? People have pushed to the brink with him.

    September 12, 2009 at 7:23 pm |