Suitmakers at Hartmarx Vote to Authorize Sit-In

By Kevin Robinson in News on May 12, 2009 4:40PM

Workers at the Des Plaines Hartmarx suit plant voted Monday to stage a sit in - a la Republic Windows and Doors - if Wells Fargo goes forward with plans to liquidate the company and its assets. Hartmarx filed for Chapter 11 bankruptcy in January, and Wells Fargo, which took $25 billion in federal bank bailout funding in October, holds over $100 million of the company’s debt. Wells Fargo issued a statement on Monday saying that Hartmarx "has been in default of its loan obligations to banks in the group that have provided it credit, including Wachovia Capital Finance, part of Wells Fargo."

The statement went on to say:

"...while traditional bank loans are based primarily on financial performance, the credit available under an asset-based loan depends on the value of a company's assets, usually accounts receivable and inventory. Asset-based lending gives a company the flexibility to achieve a variety of objectives, ranging from growth by expansion or acquisition to facilitating a turnaround or restructuring. As with any loan secured by collateral, if the borrower can't repay the loan, the lender must ultimately look to the value of the collateral for repayment."

Joe Costigan, treasurer of the Chicago-Midwest Region of Workers United, the union that represents Hartmarx workers, said "We'll stand up and take whatever action is necessary," adding that "we're going to draw a line in the sand and fight back." Ruby Simms, a 32-year veteran of the Des Plaines plant put it more plainly: "Everyone at the plant is worried about their future. It all hinges on Wells Fargo. They have to do the right thing and allow this company to be reorganized--so jobs can be saved.” Pamela Wyatt, who has worked for Hartmarx for 33 years, told the Sun-Times “I’m ready for a sit-in." Other senior employees echoed that sentiment. 66 year old Filippo LaSusa¸who has worked for Hartmarx for 48 years told the paper, "I would like to retire, and not be kicked out by a bank."