From AJR, September 1998 issue
How the Cincinnati Enquirer's hard-hitting investigation of Chiquita Brands International unraveled.
By Alicia C. Shepard
Alicia C. Shepard is a former AJR senior writer and NPR ombudsman.
IT WAS A SLOW SATURDAY NIGHT in June for the Associated Press' Joe Kay. He usually covers sports, but the Cincinnati Reds were out of town, so he was working the desk from 4 p.m. to midnight. Around 5 p.m., Kay wandered down the hall to the Cincinnati Enquirer's newsroom to check Sunday's budget for stories AP might want to rewrite. Nothing much on the budget, noted Kay. It would be a good night to catch up on paperwork.
Five minutes before he intended to leave, Kay was writing a note to the other AP bureaus in Ohio and waiting for an Enquirer copy clerk to bring him the first edition. He wanted to make sure he didn't miss anything in the pre-printed sections. Then he'd head home. His face was trained on the computer screen when the news aide walked in with Sunday's paper. ``You'll want to see this,'' he said. He was right.
Kay found himself staring at a black-bordered story splashed across the top of the front page announcing that the Enquirer was apologizing for and renouncing an 18-page series of hard-hitting articles it had published only 56 days earlier. The paper had agreed to pay the subject of the pieces, Chiquita Brands International, in excess of $10 million and run an apology on the front page three times as well as on the Enquirer's Web site.
Kay immediately alerted the AP bureau in Columbus, the state capital, to put out an advisory. It was clear he wouldn't be going home any time soon.
He dashed down the corridor to the Enquirer newsroom to see if he could find an editor to comment. ``I'm sorry, we really didn't know anything about this,'' said an apologetic weekend editor. About a half-hour before the first edition deadline, the desk had been told to tear up the front page.
Kay searched for Enquirer Editor Lawrence K. Beaupre, who had closely supervised and edited the project, but he was closeted with shell-shocked staffers. Kay knocked out 450 words on the paper's startling about-face and then found Beaupre again. The editor told Kay he couldn't say a thing. Instead he took Kay up one floor to Publisher Harry M. Whipple's 20th-floor office.
``You're paying $10 million plus,'' Kay recalls saying. ``Why would you pay that much before you were even sued?'' Whipple started to answer several times; Kay could tell the publisher wanted to talk. But as Whipple has done consistently since the apology appeared in the Enquirer's June 28 editions, he answered each of Kay's questions by pointing to the paper and saying, ``Read the apology.''
Kay had. It was an astonishing piece that obviously had been carefully crafted by lawyers. A kind of non-statement statement that can, and has been, interpreted two ways. Chiquita portrays it as a total retraction of the series and its allegations of rampant wrongdoing by the mammoth fruit company. Others say the series' conclusions may be valid, but since some of the information was obtained illegally and unethically, the paper was forced to repudiate its findings.
The bottom line: The paper was backing away from a year of painstaking research because, it alleged, reporter Mike Gallagher had illegally tapped into Chiquita's voice mail system and used information he obtained as a result in stories questioning Chiquita's business practices in Latin America.
After leaving Whipple, Kay called Gallagher, waking up the reporter around 12:45 a.m. On Friday, June 26, unbeknownst to Kay, Gallagher had been summarily fired and escorted out of the Enquirer building after he refused to discuss with his editors how he had obtained tapes of 2,000 Chiquita voice mail messages. Gallagher, says Kay, was friendly but declined to comment--a posture he and his lawyer have adopted consistently since the apology appeared and Gallagher's career collapsed.
Meanwhile, Enquirer department heads were being called at home. After midnight, a sportswriter for the paper dropped by a party at a photographer's house. With Sunday's paper in hand, he effectively killed the party. Despite the late hour, telephone lines buzzed as staffers alerted each other to the devastating news.
No one could believe what had happened--with the possible exception of Mark Braykovich, a senior database editor at the Enquirer who had worked closely with Gallagher. About a week and a half before the apology, Braykovich was talking with Cameron McWhirter, the other author of the series. ``I mentioned to Cam that I was maybe going to take a job in Akron [at the Beacon Journal],'' says Braykovich. ``He pulled me into a conference room and said rather emotionally, `If you can take a new job, take it. Things are going to be bad around here very soon.' '' Braykovich left in August to become an assistant managing editor at the Akron paper.
According to an Enquirer statement to staffers, Gallagher, 40, ``lied to us repeatedly over nearly a year'' during the time he and McWhirter, 34, worked on the articles. The series accuses Chiquita of trying to cover up a bribery scheme in Colombia; circumventing laws in Honduras, Colombia, Guatemala and Ecuador to maintain control of independent banana plantations; using harmful pesticides on workers in Latin America; and employing lax anti-drug standards on its ships.
The 22 stories were published all at once, in a single section May 3, rather than over a few days, because editors feared Chiquita would go to court to block publication of the rest of the articles.
The stories didn't cause much of a stir when they first appeared--except, of course, at Chiquita's headquarters, only blocks away from the Enquirer newsroom. Chiquita had put the Enquirer on notice that it would take legal action if the articles didn't fairly portray the company. And had the Gannett-owned paper not capitulated, Chiquita was ready to take the Enquirer to court with a 17-count lawsuit. The prospective suit never mentioned libel (although Chiquita later sued Gallagher for libel). The company intended to go after the paper for theft, fraud, trespassing and invasion of privacy.
Ironically, the articles might have been forgotten had Chiquita not mounted such an aggressive defense. But after the highly publicized settlement and apology, Chiquita, one of the world's leading banana companies, found itself under far more intense media scrutiny than it encountered immediately after the articles appeared.
WHAT BEGAN AS A BOLD SERIES for a newspaper not often mentioned among the prime practitioners of investigative journalism turned into a nightmare of gigantic proportions for those directly involved with the project and, in a sense, everyone connected with the 157-year-old newspaper. Instead of being applauded for having the courage to take on billionaire Carl Lindner Jr., head of Chiquita, part owner of the Cincinnati Reds and Cincinnati's most powerful citizen, the paper was tarred.
The fallout is monumental: Beaupre's 30-year career as an editor has been damaged, Gallagher may face criminal charges and McWhirter's year-long reporting effort has been discredited. Subpoenas are flying, and a criminal investigation is underway of the paper, employees involved with the project and anyone at Chiquita who may have cooperated with the paper. Even former Managing Editor Jan Leach, who left in February, had two detectives show up on her Akron doorstep to grill her about what she knew.
A bunker mentality pervades the newsroom, with reporters terrified to speak publicly. Beaupre, once very involved in the newsroom, is around much less, and the question of how the paper will cover Chiquita remains unanswered. Whipple and Beaupre are hamstrung by the Chiquita settlement from providing their staff or readers any detailed, satisfying explanations.
Not surprisingly, it's nearly impossible to get a hard copy of the series. Since it was pulled from the Enquirer's Web site in late June, the computer savvy have found the stories elsewhere on the Internet, and ``black market'' URLs have been posted to Investigative Reporters & Editors' listserv (it can be found at www2.thecia.net/ users/rnewman/chiquita). The stories are still available on Lexis-Nexis, says spokesperson Lesley Sprigg, and a correction and the apology have been appended to each article.
But what of the actual information in the stories? Is it correct? That question almost seems like a footnote as attention has shifted to violations of journalism ethics and the Enquirer's apology (although the question was explored in a detailed story July 17 in the New York Times by reporter Douglas Frantz). Some say that when information is stolen by a journalist--which is what the Enquirer says happened--all the rest of the reporting in a piece is tainted. If Gallagher lied to his boss about how he obtained the information, as the paper says he did, what else would he lie about? If Gallagher used unethical tactics, such as breaking into someone else's voice mail, what other unethical tactics might he have used? Others say the facts, regardless of how they were obtained, speak for themselves. Regardless, the Securities and Exchange Commission is investigating bribery allegations against Chiquita raised by the series.
What's missing is an explanation from Gallagher, the man in the middle, accused by two megacorporations of the journalistic equivalent of treason. He is following his lawyer's advice and not talking.
``The whole thing is so sad, so tragic,'' says Leach, who had been managing editor of the Enquirer for nearly five years before becoming editor of the Akron Beacon Journal in March. ``It's very scary as an editor because you have to trust your reporters,'' says Leach, a close friend of Beaupre's. ``We trusted Gallagher. And I know there was intense scrutiny of the whole project by editors and attorneys all over the place. They had Gannett attorneys, local attorneys and I believe an expert in international law. What I have to surmise is the paper got really good advice based on bad information--if Gallagher stole the tapes. But if he did, why would he?.... Why would he risk it all?''
SOME OF GALLAGHER'S FRIENDS DON'T believe he did do it. They haven't spoken to him, only left messages on his answering machine or sent e-mails that go largely unanswered. Now it's nearly impossible to find Gallagher; he quickly put his Milford, Ohio, house up for sale after he was fired and took his wife and two young daughters to Michigan.
``I don't know the facts about the Chiquita story,'' says Mark Fritz, a New York City-based correspondent for the Los Angeles Times, who has known Gallagher for about 20 years, since they started out at Michigan's Kalamazoo Gazette. ``But I do know this reporter. He's a bulldog. Tenacious. Probably the most talented and relentless investigative reporter I ever met. He's scrupulous. He's somebody who relishes the chase.''
Gallagher began his reporting career in 1981 at the Newhouse-owned Kalamazoo Gazette, a 59,500-circulation paper, after graduating from Michigan State University. He was there until 1985 and constantly came up with stories that made his editors anxious. ``He dug up this stuff about an FBI investigation of a drug conspiracy that involved one of the most prominent defense attorneys in southwestern Michigan,'' says Mike Magner, a Washington correspondent for Newhouse's Michigan newspapers who worked with Gallagher in Kalamazoo. ``He got the story before anybody else that the attorney was under investigation, even before there was an indictment. The attorney was a real high-profile guy and it made the editors incredibly nervous. But there was an indictment. Gallagher was eventually vindicated and the attorney was prosecuted. He used to always get all this good stuff, [and] it would pan out.''
Gallagher left Kalamazoo in 1985 to move on to the larger Lansing State Journal, owned by Gannett, the nation's largest newspaper company. In Lansing, Gallagher's reporting techniques were questioned in 1986 when the FBI tried to find out who, if anyone, had leaked Gallagher information about the alleged involvement of prison officials in a drug operation. The FBI accused Gallagher of fabricating the source of his story.
In a story about the unusual investigation by the FBI, Gallagher was quoted in the Jackson, Michigan, Citizen Patriot as saying the FBI was trying to ``discredit'' him because he was releasing information it didn't want out. Brad Flory, who covered the story for the Jackson paper, said in his article that Gallagher's editor knew the name of the source but had never talked to the person. Nothing ever came of the probe.
After Lansing, Gallagher joined Gannett's fifth-largest operation, the Westchester, New York, suburban papers, a group of 11 dailies that share sports and features departments and have a combined circulation of about 170,000. It was here that Gallagher would meet Beaupre, then the Westchester paper's editor, a demanding, hands-on boss who pays attention to detail.
The two would develop a close, trusting relationship that gave Gallagher the reputation in this newsroom and later in Cincinnati as ``Larry's guy'' or ``Larry's protegˇ.'' Although Gallagher left the Westchester papers in October 1991 to cover the town of Babylon for Newsday, Beaupre lured him back 10 months later. Says Miriam Pawel, assistant managing editor at Newsday, who'd been Gallagher's boss, ``He went back because of Larry Beaupre.'' And he went to Cincinnati in 1995 because of Beaupre, who had become editor of the Enquirer in December 1992. (In 1994, Beaupre brought another Westchester alumnus, Cameron McWhirter, to Cincinnati.)
Before leaving Westchester, Gallagher wrote a book and acted as a consultant for an ABC movie about the real-life ``fatal attraction'' case of Carolyn Warmus, a teacher who in 1989 fatally shot her lover's wife in Westchester. Gallagher's 416-page book, ``Lovers of Deceit,'' was published in 1993.
``Gallagher, a reporter for the Gannett newspaper chain, is a splendid journalist and a wonderful storyteller, although not a master of English grammar,'' according to a blurb in Publishers Weekly. ``Gallagher makes it clear that he considers Warmus guilty of the slaying and presents considerable evidence to reinforce his argument.''
Westchester investigative reporter Ed Tagliaferri says the Gallagher portrayed in the press today is not the person he knows. ``We worked together on a number of things here,'' says Tagliaferri, who is still with the Westchester papers. ``What people are saying about what he supposedly did does not strike me as something he would do. All reporters go as far as we can to get information, but I never knew Mike to do anything illegal and improper. I'd love to see him get out there and talk. But probably his best defense is to sit back and say nothing.''
After Gallagher's brief Newsday stint, he stayed in Westchester for about three more years before moving to Ohio in 1995. One of the things that no doubt attracted Gallagher was a promise Beaupre made when the editor arrived in Cincinnati. In a front-page story in December 1992, the editor, then 48, was quoted as saying he ``was dedicated to aggressive reporting of local and enterprise news, including investigative stories.'' By the end of 1993, he told staffers at a meeting, he would like to be able to say the Enquirer ``turned over a few rocks.''
``I don't know what we'll find under those rocks,'' Beaupre said. ``Maybe nothing. But I hope there will be some stories that readers can look back on and say, `Gee, the newspaper really made a real difference; the newspaper really told me something I didn't know.' ''
By all accounts Beaupre's newspaper did that. A year after Gallagher arrived, he wrote an award-winning series on problems surrounding the clean-up of a nearby uranium-processing plant.
GALLAGHER AND McWHIRTER, WHO had desks right outside of the managing editor's office, teamed up a year before the Chiquita stories were published. Their goal was to take a hard look at Chiquita, a high-profile company headquartered in Cincinnati. (In an earlier incarnation as United Fruit, it had inspired the term ``banana republic.'' United Fruit was known for its reputed connections to the CIA and was accused of fixing the prices of bananas and mistreating its workers.)
Gallagher and McWhirter traveled to Costa Rica, Honduras, Panama, St. Lucia, Dominica, Brussels, Antwerp, Vancouver, New York and Washington, D.C. After the pair returned from Central America last fall, then-Managing Editor Leach suggested they work in a secure room off the newsroom with a combination lock. ``I'd worked in Phoenix with an investigative team who did that,'' Leach says. ``I just thought the material they had was so sensitive that it was better to keep it locked up.''
The pair studied reams of documents, conducted scores of interviews and, said an editor's note about the series, relied on ``more than 2,000 copies of taped voice mail messages. These were provided by a high-level source who was one of several Chiquita executives with authority over the company's voice mail system.''
As sometimes happens with ambitious investigative projects, this one led to bad feelings in the newsroom, in this case because of the length of time the project took, the cost, the fact that material was kept in a locked room and that photographs were taken only by Gallagher or McWhirter--in short, the secrecy and exclusivity surrounding the tightly controlled venture.
Not long after the paper's humiliating apology, a memo on Enquirer letterhead was faxed to local radio talk show host Bill Cunningham of WLW. It voiced publicly--albeit anonymously --the concerns many inside the newsroom had long harbored about the project. Cunningham quickly took up Chiquita's cause on his nightly radio show as banana company executives showered him with scores of documents disputing Gallagher and McWhirter's stories.
``You were right. We blew it,'' says the memo. ``This newspaper has myriad checks and balances to prevent such an occurrence. But in his zeal to win a coveted Pulitzer Prize, Larry Beaupre bypassed all of those checks and rushed the Chiquita series to print.'' In fact, the articles were vetted by lawyers with Graydon Head & Ritchie, the Enquirer's local counsel; by Barbara Wall, Gannett's in-house counsel; and its outside counsel in Washington, D.C. Even Philip Currie, Gannett's senior vice president for news, took the unusual step of reading the package.
The series, packed with information but dense and difficult to read, focused on Chiquita's business practices in Latin America. It alleged that Chiquita bribed foreign officials, used dangerous pesticides that threatened workers and local residents in Central America, and is callous and insensitive to its workers. It also accused Chiquita of lax security in preventing its fruit-transport ships from ferrying cocaine to the United States and said the company set up a complicated ownership structure that ultimately allowed Chiquita to control banana plantations in host countries that don't allow or sharply limit foreign ownership. Although the series quotes from the much-ballyhooed voice mail messages, it's clear the stories are also based on first-hand interviews, legal documents, leaked corporate memos, visits to Chiquita plantations and land records in Central America.
``I went through the series and blacked out every instance where we used voice mail,'' says Braykovich. ``We still had a great story. One significant story about the bribery would have been lost but everything else stands. The voice mail merely buttresses parts, but it wasn't crucial. The voice mail was sexy, additional information.''
Nonetheless, when Chiquita officials saw the special section on May 3, they were livid, particularly about the intercepted voice mail messages. Officials at Chiquita, a leading producer of the bananas grown in Latin America, depicted the massive reporting effort as devastating, as well as false and misleading.
``We've been in business for over 100 years. We have 40,000 associates. We sell to most of the larger food retailers in North America, Europe and the Far East,'' says Steven G. Warshaw, Chiquita's president and chief operating officer. ``Plus, this is the Internet generation. Global communication of all kind is easy. There are very few things unknown about our business today. How in this kind of world are there 18 pages of secrets to reveal?''
Chiquita executives also were upset that they'd provided the Enquirer with ``hundreds and hundreds'' of pages of documents defending themselves and answered endless questions, yet saw little indication of that in print. What was missing, they say, was balance. ``It didn't portray the company I work for,'' says Robert W. Olson, Chiquita's general counsel.
GO TO PART TWO