IN THE JOURNAL | BOOK REVIEWS
Tragedy in paradise
July-September 2013

 

King Larry: The Life and Ruins of a Billionaire Genius

 

By James D Scurlock

(Scribner, 2012, 328 pp)

 

 

Reviewed by Henry N Heinz

 

This is the story of the life, death and postscript of Larry Hillblom. If you have never heard of Larry Hillblom, you are not alone. He might be the most influential businessman of the past 50 years that almost no one has heard of. He’s best known as the “H” in DHL one of the original founders of the international air courier company. 

James Scurlock knows a good story when he sees one. Larry Hillblom has all the elements: a colorful character, success born from humble beginnings, David vs Goliath battles, exotic locations, salacious sex, personal tragedy and a mysterious ending to his life.

Unfortunately, the only thing this story lacks is a happy ending. “King Larry,” like a classical tragedy, plays out in three acts. The first tells the story of Hillblom’s early life in a small California town born into a family of modest means. He worked his way through university and was accepted to the University of California, Berkeley’s Boalt Hall School of Law, in the 1960s. He also had a job as an air courier and would attend law school during the day and carry documents by night on flights between the San Francisco Bay Area and Los Angeles. 

After law school, he saw an opportunity in the air courier business and founded DHL with two other partners, Adrian Dalsey and Robert Lynn. The foundation of what would become a global company was not smooth. DHL had to fight legal battles brought on by a larger competitor, as well as the United States Civil Aviation Board and the US Postal Service. DHL lost several legal battles but eventually won the war, and against long odds became one of the fastest growing companies in history. 

The second act follows Hillblom’s migration to the Pacific island of Saipan, the capital of the Commonwealth of the Northern Mariana Islands, where he lived for about 15 years. Over time, he distanced himself from DHL’s day-to-day operations and expanded his interests into real estate, communications and various other ventures that spanned the Pacific islands. In the early 1990s, Hillblom managed to skirt US laws against investing in Vietnam and was probably the first American investor there after the Vietnam War.

Why would a multi-millionaire choose to relocate to Saipan? It wasn’t only for the tropical weather and lifestyle. As a commonwealth, the Northern Marianas enjoys a special relationship with Washington, a key feature of which established Saipan as a tax haven for American citizens. Yet Hillblom also took an interest in Pacific island politics after the post-World War II Trust Territory relationships ended, seeing that the islanders were not getting a fair deal from Uncle Sam. This relationship was symbiotic to be sure – Hillblom helping Saipan to preserve its sovereignty also helped him preserve his tax status. He earned the trust and respect of the native islanders, though, ultimately resulting in an appointment as a special judge on the commonwealth’s Supreme Court.

The second act, however, also delves into Hillblom’s sordid sexual exploits, which included fathering illegitimate children and having sex with underage women across Asia. Due to his fear of HIV/AIDS, this also included seeking out young virgins.

Throughout the first two sections of the book, there is much discussion of how Hillblom lived – he wore jeans and T-shirts, lived in a modest island home and would happily choose a friend’s sofa over a five-star hotel. The reader also learns about how he was badly injured in a private airplane crash in the early 1990s but survived. Act Two closes with his death. He “presumably died” in a second private plane crash in 1995 at the age of 52. The word “presumably” is key because, unlike the plane’s other two passengers, Hillblom’s body was never recovered. The “Elvis sightings” and conspiracy theories still abound 18 years later.

Act Three covers “the probate to end all probates.” Hillblom was never married, and the matter of his illegitimate children was not addressed in his will. Other ingredients included an estate worth at least a few hundred million dollars held in very complex and poorly documented holding structures, and a named beneficiary in the form of a foundation that was charged with channeling a vast amount of his estate into a trust for medical research (ultimately to the benefit of powerful institutions such as the California State University system). This mixture, with the added catalyst of lawyers on contingency fees, inevitably resulted in a volatile legal cocktail.

As Scurlock points out, the legal proceedings over Hillblom’s fortune total about one million pages of documents. About 100 pages of his book are dedicated to this multi-ring circus. Scurlock correctly points out that this would have been avoided if Hillblom, who by all accounts was a legal genius, had simply written a better will. A settlement was reached in late 1997, with four illegitimate children splitting the estate on a 60-40 basis with the Hillblom Foundation. Scurlock draws his book to a close with a brief follow up on what has happened to the children in the years since. This postscript, unfortunately, also does not end with “happily ever after.”

Scurlock’s history as a writer and filmmaker includes his previous book and film project, “Maxed Out,” which won critical acclaim for its depiction of America’s easycredit culture in advance of the 2008 banking collapse. His background in finance is clearly beneficial in breaking down some of the complex business and legal issues involving Hillblom’s estate battle. While Scurlock never had the opportunity to meet Hillblom, the amount of research he undertook is impressive. His travels and investigations spanned three continents and included several months of exhaustive research; this clearly shows throughout the book.

Unlike the casual reader or critic, however, I am very familiar with the Hillblom story. I lived in Saipan and throughout Micronesia from 1990 to 1997, and met Larry a few times, although I can’t say I knew him well. I personally know several of the people depicted in the book and was in Saipan when a number of the events chronicled occurred.

I have my own views of Hillblom, but considering these biases, I think Scurlock maintained a fair balance in his treatment of the subject. It would have been easy to focus more on the salacious or eccentric aspects of his life, as other articles on Hillblom have done.

Scurlock’s writing is at its best when he sticks to the facts. For example, he does a good job of framing the nature and significance of Hillblom’s various legal battles and what it meant to be in the air courier industry and its larger impact on global business. I’ve met a few of the people involved in the early “go-go” years of DHL, and Scurlock seems to paint a pretty good picture of those heady times. This aspect of the book appears to have benefitted from the passage of time – it is probably easier to frame DHL’s role and the importance of the air courier industry today than it would have been before the arrival of Internet-based business.

I’ve held the view for many years that the story of DHL (and possibly Hillblom’s business ventures in Vietnam) should be required reading for a university course on international business and entrepreneurship. Scurlock’s account would serve this purpose well. I’ve read numerous articles about Hillblom, and there seems to be a misconception that he was some sort of hermit. This is a mischaracterization that Scurlock rightly dispels. In reality, Larry Hillblom was pretty approachable.

I met Larry for the first time when I had just moved to Saipan. I was standing in front of an office building where he also had an office, not quite sure where I was going. I ended up stopping a scraggly looking guy in a dirty T-shirt and blue jeans and asking for directions; we had a short and reasonably pleasant conversation. He told me his name was Larry and asked me to pass along his regards to my boss. When I told my boss later, he asked me what the guy looked like. I told him he looked like the gardener. My boss laughed as he informed me that the “gardener” was worth about half a billion dollars – a valuable lesson was learned on making judgments about a person based on appearance.

Yet “King Larry” has its faults. I found Scurlock’s writing style distracting. He spends a lot of time setting scenes, overly describing his actual interviews and developing minor characters. At times, this reads like fictional biography, where some of the scenes are clearly made up. It also introduces several inaccuracies generally involving other characters. I took particular exception to a few of these; in fact, one description of a particular person borders on character assassination. A casual reader would probably not notice, but more to the point these scenes and characters don’t really have a bearing on the overall story. If anything, they take the tale off course.

Another weak point is that Scurlock delves into topics such as “What was Hillblom thinking at the time?” Although he admits he was unsuccessful in finding the answers, in reality it was difficult enough to separate fact from the urban legend surrounding Larry when he was alive. This can only get blurrier with time.

In some cases I think Scurlock may have tried to find answers that aren’t there, and might have mischaracterized Hillblom himself (such as when discussing some of the smaller business ventures). Hillblom was a lot shrewder in business than Scurlock gives him credit for.

The other part of the book – and perhaps the saddest part of the Hillblom legacy – is the 100 or so pages dedicated to the probate battle. In going through the details, I think Scurlock may have lost focus on the bigger picture. Hillblom clearly wanted the majority of his wealth to benefit some greater good via his foundation. I don’t think he would have intentionally shirked his responsibility to any children or to his live-in partner in Saipan. It is my recollection that his will (even with its faults) left his closest family relatively modest sums of money (a few million dollars) compared to the overall value of his estate. The story might have benefitted from a sharper look at the motives of some of the parties involved, thus keeping to the wider picture, as a lot of the legal wrangling is tedious.

On balance, the book needed more polishing, and Scurlock could have played to his strengths with a more fact-based analysis. He could have made some of his points clearer when looking at the political aspects, investments and legal battles, avoiding conjecture and fictionalization.

But when I read books like this, I judge them as good if I’ve learned something. Based on this, “King Larry” is a success. There is also a second valuable lesson I now take away from Larry Hillblom: it’s time to update my will.

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