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Page 2 of 3 from Top Gun
Dyan Machan, 03.31.03
"Jannuzzo went crazy," says Glock, without further explanation. (A source close to the company says Jannuzzo was frustrated and had tried to quit before.) Jannuzzo, 46, and Glock clashed and agreed to part ways after the annual Shot Show gun convention in Orlando, Fla. last month. Glock had hoped to retain Jannuzzo as his general counsel while assigning the operational duties to another employee. Jannuzzo will remain Glock's outside counsel and declines to comment on the situation, though he earlier told FORBES, "Mr. Glock does not shy away from a fight."
He should know. Jannuzzo spearheaded Glock's efforts to kill the Clinton Administration's voluntary gun-control effort in 2000--it was that or face a multitude of tobacco-like government-sponsored lawsuits. "Extortionist," is how Glock refers to the measures that would have introduced an oversight committee, as well as restrict how guns are sold. (The company's obstinacy resulted in 28 liability suits filed by municipalities claiming that Glock is responsible for murders committed with its weapons; 11 suits remain.) Jannuzzo also led a successful patent infringement suit against Smith & Wesson, which created a gun that looked a lot like a Glock--"I felt like my wallet was stolen," Glock hisses--and resulted in an undisclosed multimillion-dollar settlement. And Jannuzzo acted as pit bull in notifying 12 record labels that the company objects to artists using the word "Glock" in rap songs such as Dr. Dre's "Bitches Ain't ****," mainly out of fear that Glock's name will become a generic term for handgun.
Glock is now more than ever a one-man show. His two sons, Robert and Gaston Jr., and his daughter, Brigitte, have company jobs but limited authority. When asked what her role is, Brigitte cracks in German, "Being my father's personal slave." Who has input into product development? Showing rare humor, Glock smiles: "You might call it 'a very small committee.'"
And so it has been since the beginning. Back in 1981 Glock was producing plastic grenade shells for the Austrian army, in addition to plastic curtain-rod rings. One day he overheard two colonels complain that no gun existed that could meet their specifications. When Glock offered to make one, they laughed at him.
"You do not laugh at Mr. Glock," says Christopher Edwards, the burly former deputy sheriff of Jefferson County, Ky., who now runs Glock's training program in Smyrna, Ga. "He takes that personally."
Glock never doubted he could make a superior gun. "That I knew nothing was my advantage," he says. He worked on his weapon nightly in his basement. He test-fired it with his left hand so if it blew up, he could still draw a blueprint with his right. "I learned to stay out of his way," smiles his wife, Helga. The firearm surpassed all competition, and he received the army's order for 25,000 guns in 1983.
But Glock was eager to grow. Two years later he traveled to Luxembourg, a country where holding companies are not subject to income or capital gains taxation. During a chance encounter on a street in the city of Luxembourg, Glock asked a businessman if he knew someone who could help him expand his fledgling enterprise. "I am your man," said Charles Ewert, who claimed he had international connections.
He also had a reputation that Glock had not been aware of. Ewert had a habit of forming offshore companies to hold business interests for people who requested that sort of thing, earning him the sobriquet "Panama Charly." The two agreed that Glock would employ Unipatent, a shell company Ewert owned, to hold the shares of subsidiaries Glock set up to sell his guns. Unipatent, it turns out, had a dubious history. Ewert had bought the shell, which was once owned by Hakki Yaman Namli, a Turkish financier. Namli controlled the First Merchants Bank in Cyprus, and was convicted, along with the bank, of laundering $450 million in 2000. (The conviction was overturned a year later.) During the trial Namli insisted the bank was owned by Ewert.
Whatever his connections, Ewert became a public face of Glock outside Austria. Glock himself concentrated on manufacturing. In 1985 the company opened a U.S. subsidiary in Smyrna to promote sales to policemen. Good move. With the rise of drug-related crime, cops did not want to be outgunned by criminals and were trading in their six-shot revolvers for semiautomatic pistols. The Glock 17 held 18 rounds and, because it was cheap to make, few competitors could beat it on price. Its relatively few parts also made it simple to service.
Ewert opened offices in Hong Kong, France, Switzerland and Uruguay. Glock was pleased and told his family and executives that if anything ever happened to him, they should go to Ewert. "I was considered the eldest son," says Ewert, now 49.