The Secret Of Captain X

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The secret of Captain X
By David Kesmodel, Rocky Mountain News
February 14, 2004

For a decade, a longtime United Airlines pilot has kept a startling secret: He was a founder of Frontier Airlines, one of United's fiercest rivals.

Frederick William "Rick" Brown sketched Frontier's first business plan on a napkin at a barbecue restaurant in 1993, and he and his wife helped finance the company, according to Bob Schulman, another Frontier founder. Brown had flown for United for more than 30 years before taking early retirement two weeks ago.


Schulman, upholding his promise to keep Brown's name confidential, referred to him only as "Captain X."

The Rocky Mountain News also has learned that Brown recruited Frontier's first chief executive, drafted other investors and influenced the airline's pilot hiring. Frontier's first offices shared an address with a company Brown co-owned, records show.

His wife, Janice Brown, was the Denver airline's first human resources director, and her investment of about $60,000 was its single largest initial infusion of capital, according to an analysis of regulatory filings.

The couple's money was invested in her name because Rick flew for United, according to Schulman and Frontier's former chief pilot, Jim Hopkins.

Even as Frontier celebrates its 10th anniversary this year, Brown's role in the company's formation has remained a secret to virtually all but an inner circle of current and former Frontier executives.

Given his employment at United, they have tried to honor his desire to remain a hidden part of the company's history.

The Browns, who now live in Punta Gorda, Fla., declined repeated requests for interviews over the past several months and did not answer written questions submitted to them. Rick Brown notified United on Jan. 12 that he would retire Jan. 31, an airline spokesman said.

Gary S. Cohen, the couple's Denver attorney, sent the Rocky Mountain News a letter saying his clients "are very private people, and desire to keep their personal lives and their personal affairs private."

The letter also said, "It is evident from your questions that many people do not want to acknowledge the contribution of Janice Brown to the founding of Frontier Airlines, which we believe is primarily because she is a woman."

The Browns' influence on Frontier's operations lasted about two years. By sometime in 1995, the couple had left Colorado for Nevada, carrying stock in Frontier that could have made them millions of dollars.

Between two worlds

Rick Brown, 56, lived a kind of professional double life as both an intrepid entrepreneur and a United company man - even helping United hire substitutes during its 1985 pilot strike.

He watched his longtime employer struggle - it is now in bankruptcy-court protection - while the airline he helped create is profitable and growing quickly.

Frontier, once a gnat to United's elephant, is now a formidable foe. The discounter and its commuter operation carry about 17 percent of the paying passengers at Denver International Airport, up from 3.5 percent in 1997. Chicago-based United and its commuter affiliates carry about 61 percent, down from 71 percent in 1997.

But in the early 1990s, Frontier was just a name in U.S. aviation history. The first incarnation of Frontier, also based in Denver, had shut down in 1986 after 39 years in business, losing a three-way Denver battle with United and Continental Airlines.

But the Frontier name wouldn't stay dead forever.

Two airline buffs would help bring it back to life.

Passion for flight

Rick Brown fell in love with flying at an early age.

"He was taking flying lessons from the time he was about 15," said Rina Stein, 56, his high school sweetheart and first wife. "He was crazy about it."

Brown grew up in Florida, the son of Kenneth H. Brown Jr., the late Orlando television sportscaster. Rick Brown was smart, handsome and outgoing, said Stein, who said she remains good friends with him. They have a daughter and two sons.

"I think he has a photographic memory," she said. "And he has that sort of thing where a teacher would tell him something once, and he would do it."

He graduated cum laude in 1972 with a degree in aeronautical science from Embry-Riddle Aeronautical University in Daytona Beach, Fla.

He flew for a small carrier, Shawnee Airlines, before joining United. He twice was furloughed by United and joined the Air Force during one of the layoffs, Stein said.

Brown always adhered strictly to rules as a pilot, she said. For example, "he would never drink even two days before" a flight.

Pilots who know Brown say he is a consummate professional.

George T. Lenormand, a retired United pilot, said Brown is an excellent pilot and a "very conscientious" person.

Brown once was instructing an Air Nepal pilot who made a blunder in the air and caused the plane to turn over, Lenormand said. "He was the instructor, and he got it turned back around."

William Blumberg, who knew Brown from the Air Force Reserve, said Brown is "top-notch." He flew C-130 planes and "was one of the foremost safety officers there."

Two airline buffs meet

By the early 1990s, Brown was living in Parker and had racked up more than 20 years of experience at United.

He also co-owned a pilot-training company called Air Crew Resources with fellow United pilot Arthur Ziccardi. They operated at Centennial Airport in Arapahoe County.

Bob Schulman, now 71, had worked at the original Frontier as head of corporate communications and had helped start a carrier called Reno Air in Nevada.

Air Crew brought Brown and Schulman together.

Brown was looking for someone to do public-relations consulting for Air Crew. His wife, Janice, whom he married in 1991, recommended Schulman.

Janice Brown had at least a dozen years of experience in the airline industry herself, including two years at United. She knew Schulman from her days at the original Frontier, where she was a flight attendant from 1976 to 1986.

Schulman got Rick Brown some good press. In October 1991, The Denver Post published a flattering feature article about Air Crew, later known as Arnautical. The story focused on the firm's training of foreign pilots to fly for carriers in Nepal, Mexico and elsewhere and said the company was due to top $5 million in annual revenue.

Rick Brown and Schulman hit it off immediately. They discussed ideas about the airline industry while puffing on cigarettes outside Arnautical's offices, Schulman said.

At the time, Houston-based Continental Airlines was trying to recover from its second bankruptcy. Industry insiders expected Continental to scale back its operations at Stapleton International Airport or at the soon-to- be-opened DIA. That would give United the dominant role in the Mile High City.

Schulman and Brown saw an opening there.

At a Bennett's Bar-B-Que restaurant near Centennial Airport in early 1993, they began planning an airline that would try to capture routes vacated by Continental, Schulman said. Their initial plan was to launch a charter airline to quickly get off the ground.

Brown had heard from some of his overseas contacts that Condor, a major international charter airline, wanted to establish a presence in Denver by working with another carrier, Schulman said. At the time, Condor was a subsidiary of the giant German carrier Lufthansa.

The men discussed a scenario in which their airline - initially known as AeroDenver Travel Services - would make charter flights by "wet-leasing" planes from Condor. That means leasing not only the aircraft but also the flight crews.

The original idea was to fly from Denver to Frankfurt, Germany.

Rick Brown scribbled notes on a napkin, Schulman said.

The plan was that "we could be charter-certified by the feds and ready to quickly amend our certificate for scheduled service when Continental cut some of its Denver routes," Schulman said. "Of course, the cutback probably wouldn't start for a year or so, we figured, so we'd have plenty of time to get up and running."

Bringing in talent

In mid-1993, Schulman and Rick Brown recruited M.C. "Hank" Lund, the ex-CEO of the original Frontier, to run the new carrier.

Lund, referring to Brown only as "the United captain" or "the United pilot," said he first got a telephone call from Schulman. Then Rick Brown flew to Arizona and met with Lund, who was in his early 70s, about the charter plan.

Lund called Sam Addoms that July and persuaded the entrepreneur and former banker to join the startup company. Addoms later succeeded Lund as CEO and led Frontier from several near-collapses into a leading discount carrier.

Addoms, now Frontier's chairman, declined to comment for this story. A Frontier spokesman also had no comment.

Lund and Addoms came aboard when "we were still hoping to start out as a charter carrier," Schulman said.

The idea of working with Condor and another potential overseas backer, based in Israel, did not pan out, Schulman said. They considered other ideas, too - Denver-Frankfurt with a stop in Florida, as well as destinations in the Caribbean, Hawaii and Mexico.

As the charter idea sputtered, something else came into play: Continental showed by late 1993 that it was going to cut routes from Denver more deeply and sooner than many had expected, Schulman said.

This retrenchment set in motion a rapid plan to drop the charter concept and quickly replace Continental's service on routes from smaller cities to Denver, Schulman said.

Around that time, Lund said, he asked Arthur T. Voss, the new carrier's general counsel, to check into whether the Frontier name was still available. It was.

New direction

Lund and Addoms led the launch of the new business plan, which envisioned Frontier as a regional carrier feeding traffic to Continental and United in Denver.

"Schulman was all for (the new plan), and so was the United pilot," Lund said.

Rick Brown's "direct involvement pretty much diminished after the (new) business plan was wrapped up" in November 1993, Schulman said, but "he stayed involved through his wife."

Hopkins, Frontier's first chief pilot, said Rick Brown still influenced how the company developed.

"He was trying to run the show from the sidelines, because he was a United pilot" and "had to walk on eggshells," said Hopkins, who is an official with the Federal Aviation Administration.

Rick Brown later recruited other investors to Frontier, including at least two who had ties to him through United and Arnautical, which won a contract to train Frontier's pilots.

One was Valarie Ziccardi, the wife of Arthur Ziccardi, the United pilot who was Brown's Arnautical partner.

The other was Kenneth Park, who worked at Arnautical.

Valarie Ziccardi and Park each acquired 10,000 shares in Frontier, and both sold them in Frontier's secondary offering of public stock in September 1995, Securities and Exchange Commission filings show.

Park, of Golden, said he paid $10,000 for his stock and made "a nice, healthy profit" when he sold it.

Valarie Ziccardi, when called at her Arapahoe County home, said, "I don't know anything. I'm just a housewife."

She then hung up.

Arthur Ziccardi, who once led a failed effort to launch a charter operation at Centennial Airport, declined to be interviewed. He called the United-Frontier connections "an interesting little sideshow" but said "nobody has any interest in talking."

SEC filings show Janice Brown and Lund as the two biggest initial investors in Frontier. The filings use the middle initial B for Janice, when in other public records she uses a D or an E - usually a D.

For a commercial airline, Frontier began on a shoestring budget. The company raised $515,650 from founders and other investors in February and March 1994, including $55,500 from Lund, $22,000 from Addoms and $11,000 from Schulman, according to an analysis of SEC filings.

A private placement organized by Addoms, who initially was Frontier's executive vice president and treasurer, raised $1.3 million in April 1994. The next month, the carrier went public at $4.25 a share, raising about $8 million.

The first planes took off on July 5, 1994.

Janice Brown's investment came from the couple, not just Janice, said Hopkins and Schulman, who was Frontier's vice president for corporate communications.

"All the funds were funneled through (Brown's) wife rather than him, but he was the pushrod behind it," Hopkins said. "That was the understanding I had."

Others, including Park and Lund, said Rick Brown invested a sizable portion of his personal savings in Frontier.

The United captain "had asked us to keep his name private," said Lund, now in his early 80s. "He has never released me from that confidence."

Janice Brown, Lund and others obtained their shares for 50 cents each, according to SEC filings and interviews with Schulman and other executives.

The filings show that Janice Brown got 119,300 shares, which would mean she paid $59,650.

Frontier's initial employees worked without pay at first but were awarded options to buy Frontier stock. Janice Brown received 146,188 options, most with a purchase price of $1.10. When or if she exercised any of those options before they expired on March 9, 1999, is unknown.

Frontier listed its address as the same as Arnautical's in the carrier's articles of incorporation in Colorado on Feb. 8, 1994 - 10 years ago this month.

Frontier held a number of meetings at Arnautical, but often met at Addoms' one-bedroom Park Hill bungalow, several founders said. By mid-March 1994, Frontier had moved into spartan offices on East 46th Avenue and Peoria Street.

SEC filings detailing Frontier's initial public stock offering referred to Janice Brown as one of the "founders" or "parents" of the company. She was honored for that role by Frontier at its fifth anniversary celebration in 1999, along with 13 other founders.

Rick Brown wasn't named.

The only public reference to him by Frontier appears to be in 1994 SEC documents, and his name was misspelled.

Frontier had signed a $230,000 contract for Arnautical to train Frontier's pilots and flight attendants. The filing noted that "Ric (sic) Brown, husband of Janice B. Brown, is a part owner of" Arnautical.

Training issues

Frontier's contract with Arnautical lasted about six months, said Hopkins, who had been a flight instructor for Arnautical and was recruited by Rick Brown to be Frontier's chief pilot.

Arnautical "trained the first two or three classes of pilots - I think it was the first three - and then we decided to bring it in-house and get better control of it," Hopkins said.

Rick Brown was upset, he said.

"Rick had an idea of using Frontier as a training bed," Hopkins said. "He wanted to bring people in and train them as a first officer on a (Boeing) 737, then have them fly on Frontier for a time, and then seek employment elsewhere. (Vice President of flight operations Jimmie) Wyche and I didn't want that. We didn't want in-transit employees."

Arnautical was dissolved in 2001, according to filings with the Colorado secretary of state. The company's clients also included now-defunct Western Pacific Airlines, which was based in Colorado Springs.

Janice Brown, now 48, worked for the new Frontier as its human resources director for roughly six months to a year, other founders said.

She came to the company with several years of experience in human resources management, according to the biography she submitted with Frontier's 1994 application to the U.S. Department of Transportation to start service.

Since 1991, she had been president of her own human resources consulting firm, J.D. Brown & Associates, which shared an address with Arnautical. The firm worked with foreign and U.S. airlines.

For two years before that, she was involved in pilot hiring for United in Denver. She also had worked for Tokerud & Associates in Denver, where she arranged management seminars for corporate executives.

Frontier co-founder Julie Dickman said she loved working with Janice Brown, who was "really involved" in Frontier's first meetings as it planned to become an airline.

Jeannie Mann, another Frontier co-founder, described Janice as "a nifty lady."

Hopkins said he enjoyed working with both Browns. He said Rick could be pushy, but "he was reasonable to a certain point."

"Both (Browns) are strong- willed," he said.

Lund said he got along well with Rick Brown, but Brown didn't get along well with the other officers, including Addoms.

"There really was no role for him, except he was one of the two who brought me on board, so he felt he had more power than he had and tried to use it," Lund said. "He came across to others as being abrasive and arrogant. He wasn't a team player."

It is unclear whether Rick Brown envisioned Frontier rising up as a serious competitor to United.

The company tried in 1994 to team with United and Continental to link passengers from Frontier's smaller markets to the bigger carriers in Denver.

United wouldn't agree to any ticketing alliances. Continental agreed, but it dropped a huge number of flights to big markets from Denver, weakening the benefit of the partnership.

Those two factors prompted Frontier to alter its strategy. In 1995, it dropped unprofitable flights to some smaller markets and began mostly flying to larger cities, such as Las Vegas, Chicago and Phoenix.

Rick Brown played no role in Frontier's talks with United, as far as Schulman knew.

A family affair

The Browns' influence on Frontier in its early days revolved largely around its staffing for flight operations.

Wyche, the vice president of flight operations, said Addoms and Lund had promised Rick Brown that one of his sons, Sean Brown, who was about 27, would become the No. 1 pilot on Frontier's seniority list.

Sean Brown, who had been a pilot in the Air Force, was not certified yet to fly for Frontier, Wyche said. But the younger Brown had joined the fledgling airline before Hopkins and Wyche did, setting up the carrier's technical manuals for flight operations.

Both Lund and Hopkins confirmed that Rick Brown wanted Sean to be No. 1. But Hopkins said Sean Brown balked. "Sean said 'No, I don't deserve to be No. 1,' " Hopkins recalled.

Sean Brown declined to be interviewed for this story.

He wound up second or third on the seniority list, with Hopkins at the top, according to Hopkins and another Frontier founder, William Durlin.

Wyche said he protested to Addoms and Lund that putting Sean Brown high on the list would cause resentment among the veteran airline pilots being hired. And it did, he said. But Wyche said Sean Brown, who began flying for Frontier roughly six months after it began service, was a very talented co-pilot and "a great young man."

He was a "very good employee," Hopkins said. "He did a tremendous amount of work on the computer with our (technical) manuals. He had a good head on his shoulders. He could have been a flaming rear end with his father putting up the major money to get the airline started. He was just a good guy."

Sean Brown eventually left Frontier and joined United as a pilot. Today, he sells real estate in the Las Vegas area and helps operate Web sites that include www.pilotsunited.com, an informal site for United pilots. He took a voluntary leave from United after the 2001 terrorist attacks when the carrier needed to reduce pilot jobs, said his mother, Rina Stein.

Wyche said he had a rocky relationship with Rick and Janice Brown. At one point, Janice Brown told Wyche they needed to interview some pilots, and Wyche said he couldn't because he would be out of town for a few days.

Janice Brown suggested that her husband could conduct the interviews.

Wyche said he angrily told her that under no circumstances would he let Rick, employed by United, interview any pilot candidates.

Hopkins confirmed the incident.

Hopkins said he thought Janice Brown left Frontier for multiple reasons. One, he said, was that the Browns' philosophy on hiring pilots was different from Hopkins and Wyche's.

The Browns were mirroring their hiring philosophy to United's, which heavily involved the human resources department, Hopkins said.

"We felt we were not United and didn't want to be United. If we liked a person, we wanted to hire them on the spot, rather than wait through a long, drawn- out process," Hopkins said.

'Deserve every dime'

The Browns moved from Parker to Boulder City, Nev., near Las Vegas, in 1995, and their role in Frontier diminished.

How much money the Browns made off their Frontier investment and whether they still own stock are unknown. Janice Brown's ownership stake dropped from 7 percent to less than 5 percent in September 1995, so no financial disclosures to the SEC were required after that.

SEC records show only that Janice Brown sold a fifth of her shares in 1995 at a gross profit of more than $100,000.

Her remaining 141,450 shares - adjusted for a 2001 stock split - would have been worth $3.7 million when Frontier shares hit their all-time high of $26.17 in early 2001. If she held all the shares today, they would be worth about $1.5 million.

About a year ago, the couple moved to Rick Brown's home state. They live in a $450,000 house on Florida's Gulf Coast, and, until his retirement, Rick Brown flew jumbo jets for United overseas. He will turn 57 next month, putting him three years away from the mandatory retirement age of 60 for U.S. airline pilots.

Brown "is quite proud" of his role in starting Frontier, said Schulman, who has stayed in touch with Brown over the years.

"It's been said that Captain X and myself came up with a spaceship, Hank (Lund) got it into orbit, and Sam (Addoms) raised enough cash for the orbit fee," said Schulman, who is retired. "That's not to say a lot of other people didn't play important roles."

Brown saw his Frontier involvement as "strictly business," Schulman said. And Schulman saw nothing wrong with it, either.

He pointed out that Frontier might not have become such an intense rival to United if the larger carrier hadn't rejected all types of ticketing alliances.

United said in a statement that it didn't know about Brown's involvement in Frontier and does "not know it to be true."

If it were true, the carrier said, it would have been considered a conflict of interest, which would violate its code of conduct. The most severe disciplinary action for violating the code is termination, United said.

A spokesman for the Air Line Pilots Association, the union representing United's pilots, declined comment on Brown's actions at Frontier. The spokesman said Brown did not belong to the union, but, like all United pilots, was covered by its contract with the carrier.

It isn't unusual for airline pilots to buy stock in other carriers. But United has cause for concern if an employee creates "a competitor at one of your hub cities or even a competitor that could conceivably grow and threaten your franchise," said Bob Mann, an industry consultant in Port Washington, N.Y., and a former American Airlines executive.

"It's an intensely competitive business," Mann said, "and the last thing you want is one of your own people sleeping with the enemy. I'm not sure either company could have been very pleased about this."

For United, the pilot's actions "would be grounds to be very upset," but because he was not a corporate officer of United, he did not violate any fiduciary duties to United's shareholders, said Charles M. Elson, director of the Center for Corporate Governance at the University of Delaware.

Many airline pilots are "wannabe airline managers," but Brown's story is "an interesting anomaly" because Frontier succeeded, said Stuart Klaskin, an industry consultant in Miami.

It's unlikely Brown, as a pilot, had access to any privileged information about United that he could have shared with Frontier, Klaskin said. Brown's "scope of corporate knowledge" was probably no greater than an average investor's, he said.

"I would make the argument that what the guy did with his money earned at United is fully for his right and responsibility," said Klaskin, a principal at KKC Aviation Consulting. "If he was an original investor in Frontier, you almost can make the argument that he really must love his job at United because he almost surely would have made enough money from his Frontier investment to retire."

Schulman doesn't know how much the Browns have made from their Frontier investment, but he thinks most of the founding investors did well.

The pilot deserves whatever he made - and a lot of credit - for helping to start a successful airline against steep odds, he said.

"And all these other people that made a bundle of money, they took a big risk at the time and deserve every dime," he said. "People would say, 'You're investing in an airline? You're crazy. And on top of that, you're going against United?' "




[email protected] or 303-892-2514. News librarian Sarah Landeryou, staff writer David Milstead and Scripps Howard News Service reporter Mia R. Garcia contributed to this report.


Copyright 2004, Rocky Mountain News. All Rights Reserved.
 
"Rick Brown, 56, lived a kind of professional double life as both an intrepid entrepreneur and a United company man - even helping United hire substitutes during its 1985 pilot strike."

SCAB!!! Worthless MutherF##@ SCAB

"Pilots who know Brown say he is a consummate professional."

Funny, they only quote other SCABS!!!


For all you folks who think scabs are "Company" men, take note, they WILL stab you in the back. This jerk couldn't even keep his commitment to his wife.
What a waste of "male genetic material"
 
screw desk,
shouldn't you be learning the contract? Hmmm, lets see, you are correct, 19 years ago he proved he was a scumbag. But what about FRNT was that 19 years ago? would UAL have needed more of your fellow employees if FRNT wasn't in DEN? The sad part is his actions resulted in his son (a genuinely good guy) losing his job. But he got his. A real "class act". Guess we should empty all the jails, after all, the crimes are "old news". Guess we should "get over it". But congrats, you just re-affirm why most crew members dislike you. The bright side is it's just more fodder for the anti-senior manning crowd.... NEVER FORGET!!!
 
ual-crewdesk-man said:
It was 19 YEARS ago...Get over it.
Just like society needs to be protected from pedifiles, society needs to be protected from back stabbing scabs. NEVER FORGET....carry your scablist.

DENVER, CO
 
ua767fo said:
Just like society needs to be protected from pedifiles, society needs to be protected from back stabbing scabs. NEVER FORGET....carry your scablist.

DENVER, CO
The way I look at it, there can at least be logic in being a scab, as sometimes there is no question a union's actions can hurt its own constituency. The "tyranny of the majority" is something an individual must sometimes revolt against.

This guy, however, actually helped launch a company that is way beyond a thorn in the side - it's become a swarm of parasitic locusts feasting on the DEN hub. There's no arguing what effect that's had on unions and mgmt. alike.
 
Sorry, I disagree, there is NEVER a good reason to scab. If you don't want to strike or think it's a bad idea, then go find another job. Good thing our military officers don't hold the view that it is OK to do your own thing when you don't agree with your leadership.... It'd be a coup a day
 
Busdrvr said:
If you don't want to strike or think it's a bad idea, then go find another job.
So, the way it looks, is that if your union leadership says we need you to sacrifice. For the good of the rest of us, go jump off the Golden Gate. You'd be one of the lemmings to fall in line. How stupid is that? Strikes are things of the past, they were great in the 50's, 60's, and 70's, but they have outlived there usefulness. Just ask the grocery workers in So. Cal how effective their strike is. Don't throw your job away, which is what you do on strike, there are other ways to put pressure on management besides a strike.
 
Busdrvr said:
This jerk couldn't even keep his commitment to his wife.
What a waste of "male genetic material"
I think there are also a number of dues paying ALPA members who failed to keep commitments to their wives. Are they also a waste of male genetic material?
 
Yes, but then again, I likely take my marital vows much more seriously than most. I try to leave by the creed that "no other success in life can compensate for failure in the home". But thats just me, and I've been reward with a wonderful spouse for it (apparently, she's being punished for something she's done...). But I notice you only picked out that part of it. In light of contemporary society's view on marriage, had I said "He's a pediphile, he killed his mom and he can't even obey traffic laws" would you reply "I know many ALPA members who also disobey traffic laws are they scumbags to"?
 
"Sundown on the Union" Bob Dylan


"(We gotta) Stick Together" Frank Zappa

BTW, had a friend at HP who got put on a scab list for years, they mistakenly had him as an EA scab pilot. But, when you are frenzied, why check for accuracy? He is off the list now, only took a decade or so...