Broken In Haft

By John Greenwald

Less than one year ago, Herbert Haft and his family embodied the American business principle that if you get out from behind the counter, keep your elbows sharp and put your family to work, you can become a very rich clan. But lo, the destruction when that same ferocious solidarity and energy turn mean and inward.

The Hafts' vast retail empire was born 39 years ago in Washington, with Gloria nudging her husband Herbert out of the back of their drugstore and the couple boldly borrowing from Gloria's parents and liquidating their children's bonds to gamble on a discount pharmacy. The venture thrived and grew into the Dart drugstore chain, which the Hafts went on to parlay into a retailing conglomerate. With $1.2 billion in sales today and about 600 outlets in seven states, the Hafts' Dart Group, which includes Crown Books and Trak Auto stores, has kept the family in Range Rovers and Florida and California mansions and at charity balls. But now a family feud of operatic dimensions has erupted, threatening to undo all that the Hafts have worked so fiercely for. "Herbert is likely to burn everything down," says a gloomy insider. "It would be surprising if the company survived."

In June, Herbert Haft kicked Gloria and their older son Robert off the Dart Group board for allegedly conspiring to speed him out the door. Directors then fired Robert, 40, as president of Dart and replaced him with his brother Ronald, 34, who had headed a subsidiary.

Last week both Robert and Gloria struck back. Robert, who was his father's carefully groomed heir apparent before the blowup, filed suit to recover more than $2 million in cash and stock that he claimed was owed him under employment contracts. And in divorce court, Gloria sued for legal separation from her husband of 45 years. Charging that Herbert had beaten her, conducted extramarital affairs and engaged in financial chicanery, Gloria demanded control of either Dart or the family's real estate company. Responding through a lawyer, Haft denied any wrongdoing and accused Gloria and Robert of forming an "unholy partnership" to seize control of the family's holdings.

The divorce suit instantly replaced White House gaffes as Topic A in Washington. The charges of abuse led wags to wonder just how much of a punch the diminutive Haft, who stands little more than 5 ft. tall even with his Don King-like surge of white hair, really could pack. For his part, Haft alleged that his wife had physically abused him and said Gloria and Robert had launched a media campaign to "destroy me."

For Herbert, 72, the battle marks a brutal climax to a career that has left behind a trail of business enemies. He fought with his brother-in-law, who charged in a lawsuit that Haft had cheated him out of investments in the family's drugstore chain. When Haft's brother Leonard sided with the brother- in-law, Herbert broke off relations with Leonard for 15 years. Herbert made frequent use of his toughness in the 1980s, when he and Robert mounted campaigns to take over such retailing giants as Dayton Hudson and Safeway Foods. While the Hafts never purchased those behemoths, they walked off with fat profits after takeover fever jacked up the price of the target companies' shares.

Herbert's steely, in-your-face style complemented Robert's gentler, laid- back manner. A Harvard Business School graduate, Robert founded Crown Books in 1977 and built it into one of the first successful book discount chains with his pitch "Books just cost too much!" Herbert took pride in such achievements and kept increasing his son's responsibilities. Since the two fell out last spring, however, Robert has been reduced to waiting outside the Washington Post offices at 3:45 a.m. to read the latest developments in the family feud; the only communications he gets from his father are daily poison faxes. "As much as he loved me is as much as he hates me now," a saddened Robert told the Post last week.

The conflict first flared at an April board meeting when Robert, who was becoming eager to succeed his father as Dart chairman, clashed with him over plans to expand a single store. While Herbert wanted to increase the company's Total Beverage liquor operations, Robert pointed out that the only existing Total outlet was operating at a loss. The split widened in May when Gloria Haft, 66, defended her son at a Crown Books meeting and beseeched her husband to end the quarrel.

Even family members have had trouble comprehending Herbert's subsequent virulence. Sources close to the family surmise that the elder Haft, who had heart problems in 1991, regards his son's eagerness to take over as an unwelcome reminder of his own mortality. The Donnybrook also puzzles investors on Wall Street, where Dart stock, a highflyer in the '80s, has been languishing. Beset by growing competition and the sluggish economy, Dart saw its profits fall to $3.5 million in its latest fiscal year, down 44% from the previous period.

While Wall Street watches anxiously, Robert is left mourning not just the uncertain future of the company he helped to build but also the loss of its original spirit. "My father is no saint, but we were a family, strong, loyal and successful together," he said. "That's why his behavior now is so inexplicable."

With reporting by Tresa Chambers/New York and Ellen Germain/Washington