On the surface, American businessman Hans Frederick Johnston and Swiss engineer Miklos Vendel seemed like the perfect corporate match.
Johnston's peers describe him as "ambitious and autocratic," a savvy deal-maker with an eye for ripe companies. Vendel fit the traditional scientific persona, studious and cautious, opting for a hands-off approach to his investments.
Together, they decided to buy Statek Corp., a struggling high-tech firm in Orange. Like so many technology executives in California, the pair dreamed that a promising new product--miniature timing devices for consumer electronics--could make them rich.
But over time, the relationship soured. A decade-long battle ensued over control of the 140-employee company, a struggle that underscores the pitfalls of mixing money and friendship.
Covert directors meetings, allegations of embezzled millions and charges of attempted murder have plagued the top levels of Statek, according to court records.
In 1996, a Delaware court found that Johnston had deceived Vendel of much of his ownership in Statek. The court awarded Vendel control of the privately held company, whose annual sales will top $13 million this year.
After Johnston left the country, Vendel sued his former partner, alleging that he embezzled $26.5 million and used the money to feed personal whims: rare art, a racehorse, a house in the Bahamas. The suit is pending and Johnston denies all fraud charges.
Risk, mismanagement and financial failure have long been hallmarks of the high-tech world, where today's high flier can become tomorrow's flop.
Yet few corporate conflicts escalate as far as this one: Last month, the 71-year-old Johnston was arrested in Britain on charges that he plotted to kill Vendel, 57, and three of Vendel's attorneys.
"Business scandal, passive investors, mismanaged companies--that's all normal. But charges of attempted murder? Now that's different," said Dan Lavin, research director for International Venture Associates in San Mateo. "In general, California's high-tech people are too laid-back to try to kill each other."
While Johnston sits in a British jail awaiting trial, the people he allegedly hired to kill Vendel remain at large. No one closely tied to this strange tale wants to talk about it--not Johnston, not Statek officials, and certainly not Vendel and his legal staff, who say they still fear for their lives.
Yet Statek's convoluted tale, now the subject of scrutiny by the FBI and Scotland Yard, is detailed in extensive court records in Delaware, where the company is chartered.
"This is an unusual case," said Thomas J. Allingham II, one of Vendel's attorneys, in a court transcript. "I think all sides concede that."
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While they owned Statek for 12 years, Vendel and Johnston were more like ghosts in Orange County's high-tech community, where they were virtual unknowns.
Neither purchased a house in Orange County. Vendel lives in Lucerne, Switzerland, and Johnston made the Hilton Suites in Orange his local home for nearly five years.
Hotel staffers remember Johnston as an eccentric man, someone who spoke of possessing vast wealth but lived frugally. He traveled often to Europe and the Bahamas and told Statek employees that he spent every Boxing Day--a British holiday commemorated just after Christmas--with Prince Charles.
"The guy had no patience. He would only fly on private jets and chartered planes, because he didn't like to wait around commercial airports," said Glenn Kurzenknabe, a former sales manager at Greenray Industries, a Pennsylvania company that Johnston once owned. "I went out to dinner with him once. I watched him pay a band to stop playing for the night because it was annoying him."
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Johnston and Vendel come from very different backgrounds. Johnston was born in 1927, grew up during the Great Depression and was educated at Cornell and Harvard Business School. He joined the military during World War II and worked on intelligence-gathering operations in Europe, according to court records.
After holding various executive positions in the late 1960s, he managed a group of companies that specialized either in engineering or technology research. His method was simple: Take struggling companies, find outside financing, turn them around financially and sell them for a profit.
Vendel was born in war-torn Hungary in 1941. A political rebel, he distributed pamphlets denouncing the Soviet Union and the Red Army during his teenage years, according to court records. When strife between Hungary and the Soviet Union exploded in the mid-1950s, he and his sister fled their homeland and eventually immigrated to Switzerland.
Vendel later received an engineering degree, then went to work for Hewlett-Packard in the computer manufacturer's Geneva offices during the early '70s.
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