Editor's Note: In August, 2015, Blaine Kern and his son Barry reached a legal agreement to dismiss all pending litigation. Blaine also sold Barry a 50.1% stake in his company, Blaine Kern Artists, Inc.
Blaine Kern Sr., 88 years old, sporting a sharp black-and-white tracksuit and chunky Ralph Lauren eyeglasses, bounces into a suburban New Orleans restaurant at lunchtime flashing his megawatt smile. "Hi, everybody!" he says, and is immediately besieged by waiters, managers, and customers eager to greet the local legend who calls himself Mr. Mardi Gras. In a city famous for larger-than-life characters, Kern occupies a unique place in the pantheon. Not for his physical stature--he's small and wiry--but for his outsize ambition, which for nearly seven decades made him the biggest parade-float impresario in New Orleans and a P.T. Barnum of the bayou.
"I did a carnival for Fidel Castro after Batista was out!" Kern says after settling in at his table, reeling off tale after tale seemingly straight out of Twain, but all true--founding a company that strung a gondola across the Mississippi River, acquiring a decommissioned aircraft carrier to convert to a tourist attraction, catching Walt Disney's eye with a huge King Kong that crashed a Mardi Gras ball--and often digressing into bawdy asides about his many romantic conquests ("My nicknames were Pretty Boy and Honey Boy!"), which have led to four wives and five children.
Most of all, Kern wants to talk Mardi Gras, the event that still defines New Orleans, where parties are a sacrament and Kern a high priest. "Michelangelo and da Vinci, all of them were float builders, so I'm in pretty good company," he says, with characteristic humility. Listening to the monologue is Barry Kern, Blaine's 52-year-old son, who does not share his dad's propensity for self-revelation. Asked about some outrageous antic of his father's, Barry usually shrugs and says, "That's just Blaine being Blaine."
But Barry wasn't so sanguine in 2010, when he started slapping his father with lawsuits in a spat that nearly destroyed their venerable company and threatened to derail New Orleans's most beloved--and lucrative--tradition. All family businesses face succession issues, of course, though most don't involve floats with naked female mannequins, packed courtrooms, a weeping wannabe-rapper wife, and press conferences aired on local TV newscasts. The Kern family wasn't supposed to have these problems. Barry was always Blaine's choice to take over the family firm, Blaine Kern Artists. Not Blaine's oldest namesake, Blaine Jr., or his youngest, daughter Blainey. Not his daughter Thais or son Brian, who both somehow escaped being branded with variations of their father's name. "Barry really wanted to do it and had the leadership ability," Blaine Sr. says. During Barry's childhood, the two were inseparable--traveling abroad, fishing, dreaming up floats, even showing up at parties wearing coordinated costumes.
Today, father and son have less in common. Their legacies are vastly different. The elder Kern built his first float in 1947 and has since helped make Mardi Gras in New Orleans a world-renowned event through his artistry, luck, and relentless self-promotion. Barry quietly turned what is now called Kern Studios into a more professional operation after he became its president in 1994, quadrupling revenue to $40 million and expanding the business with theme park attractions in Las Vegas, Europe, and Asia. ("I'm the dreamer. My son's a bean counter," Blaine says later, twisting the knife.) Every day, somewhere on the planet, people celebrate life with a Kern parade.
But Barry does a hilarious impersonation of Blaine, and loves telling his father's favorite stories, right down to the same punch lines. ("My dad grew up reading Jules Verne and H.G. Wells, so he was going to the moon way before Sputnik.") When Blaine dreams up some outlandish new project, Barry doesn't roll his eyes but immediately starts analyzing how to get it done. It's a powerful father-and-son team, with complementary talents and shared vision, one that even navigated those difficult conversations about succession: The two signed an agreement in 1993 that would allow Barry to buy Blaine's shares upon his father's death.
"I always thought everything was perfect," says Barry. "I thought we had a plan."
A decade after Katrina, New Orleans's tourism economy is once again booming--in 2013, a near-record 9.3 million visitors spent $6.5 billion there. Like Las Vegas, New Orleans provides a place to behave as you never would back home. On an average weeknight in the French Quarter, you'll see a stout barmaid in a packed tavern grab a man by the hair, slam his face into breasts bursting from her low-cut top, and pour shots down his throat. Gangs of drunken conference-goers roam cobblestone streets clutching plastic "go-cups" of beer and booze, whooping and hollering, as an astonishing variety of live music blasts from clubs' open doors and windows--hard rock, blues, soul, Dixieland, zydeco, country. It all culminates in Mardi Gras: 12 days of parades and revelry before Lent, climaxing on Fat Tuesday (Mardi Gras in French), which each year deliver a $500 million economic jolt to the city.
In 1932, 5-year-old Blaine Kern watched his impoverished painter father, Roy, build his first Mardi Gras float on a garbage wagon. Later, a local surgeon, impressed by a mural the teenage Blaine painted on the walls of a local hospital (to pay for an operation his mom needed), asked him to create floats for his social club, or krewe, called Alla. Then, Blaine says, his work caught the eye of Darwin Fenner, the scion of a wealthy banking family, who sent him off to Europe to learn the best artistic techniques to build better floats for Fenner's krewe, the blue-blood Rex.
Krewes are the lifeblood of Mardi Gras--and the Kerns' business--because these private clubs organize the parades and buy the floats. (The term, coined in 1857, is a derivation of crew.) In 2015, Kern Studios made floats for 23 of the area's 60 krewes--the most of any builder--including the three biggest: Endymion, Bacchus, and Orpheus.
A few hours before that story-filled lunch, in late January, Barry had driven his black SUV to an open house for Endymion, where members got their first peek at this year's floats while being serenaded by a deafening high school marching band. In three buildings the size of airplane hangars, several thousand people munched hot dogs and traditional king cake and gawked at the gigantic floats festooned with flowers and massive, cartoony sculptures--an Aladdin, a Tyrannosaurus rex, a Trojan horse. "They're like ocean liners," Barry said, pointing to a huge float crowned by an enormous griffin. "That will carry 300 people, more than the entire parade when my dad started."
From his earliest days, Blaine has encouraged a friendly arms race among the krewes, and every year they try to top one another in creating elaborate spectacle. Today's high-end floats sport dazzling visual effects and can cost $1 million. Endymion's are outfitted with 20-foot-long LED panels, to flash this year's theme, "Fantastic Voyages," and enormous video walls that will display live footage of the passing crowd. Krewes raise millions from membership fees--3,000 Endymion members pay $1,000 each--and selling trinkets and hosting concerts like this year's Superdome show with country star Luke Bryan. Members get to attend events like the open house, and ride on the floats in costumes and masks, throwing beads and trinkets to cheering crowds.
Everywhere Barry goes, Endymion members ask about his dad. "He hasn't changed at all," he tells one woman. But everyone knows the history, and nobody asks why he's not there. Later, Blaine says he skipped the event because he's still mad at Endymion's captain, Ed Muniz, for making comments about his wife. "I called him an asshole," Blaine declares, still agitated.
"Blaine Kern Sr. is a piece of work," Muniz sighs. "He's 88 years old, but still a teenager at heart."
How To Keep It All In The Family
There are many ways to ensure that handing your company to the next generation won't be as stormy as it was for the Kerns.
Make them participate
Discuss succession planning early and often, and give the next generation real responsibilities so they can learn from their mistakes. "Most entrepreneurs tried and failed many times before they were successful," says Joseph Astrachan of the Cox Family Enterprise Center at Kennesaw State University in Georgia. "Give your kids a chance to do that, too."
Keep things separate
Keep family and business needs separate by consulting disinterested lawyers, accountants, and governance advisers. Or establish a family business council, of family members and an outside facilitator, to air and resolve family issues. "A good business decision may not be the best thing for the family and vice versa," says Sherif A. Ebrahim, director of entrepreneurship and innovation education at Tulane University. And create a competency panel to make legally binding rulings in case questions arise about a founder's mental capacities.
Build a real board
Appoint at least five board members, preferably more, to avoid the kind of standoff that paralyzed the Kerns: With only three directors, no one could referee fights between father and son once Pixie Naquin passed away.
Know how to leave
Founders ready to cede day-to-day control should also give up their majority ownership stake so new management has unfettered freedom to call the shots. Heirs can smooth the transition by giving the founder certain rights, like veto power over the sale of the firm.
Heirs who aren't given real authority should consider leaving. "In one case I worked on, the father wouldn't give his son more authority," says Astrachan. "I told the son, 'You have a moral responsibility to go work for the competition. If your dad thinks you'll really screw things up, you'll end up hurting the competition.'"
Blaine was the captain--the leader--of the Alla krewe for nearly 50 years. There he met Barry's mom, Geraldine Fitzgerald. She was the 19-year-old queen of its 1959 parade, when Blaine was 32 and had two kids with his first wife, Maryanne. (With Geraldine, he had Barry, Brian, and Blainey.) For Alla's 1960 ball, Blaine created a 19-foot King Kong, operated by six men inside, that burst through a wall, smoke pouring from its nostrils, sending thousands of elegantly dressed guests fleeing in terror. Impressed, Walt Disney showed the ape on his TV show, and offered Blaine a job in Hollywood. (Blaine turned him down.)
"If it weren't for Blaine, there would be no Mardi Gras as we know it today," says Owen "Pip" Brennan, 81, co-founder of the Bacchus krewe. And yet, many krewe leaders have soured on Mr. Mardi Gras. "Blaine tried to cut corners and promised things he didn't deliver," says Henri Schindler, a 74-year-old Mardi Gras historian and artistic director for the Rex and Hermes krewes.
Blaine admits he's not much of an administrator. "I can't stand being in an office," he says. "I want to go out and see what the artists are doing and say, 'Make it bigger!'" For several decades, the person holding Blaine Kern Artists together was Jerelyn "Pixie" Naquin, who, in 1963, started working for Blaine at age 16, literally changed Barry's diapers, and eventually rose to executive vice president. "Pixie was the only person Blaine ever really listened to," says Barry.
By 1993, it was clear even to Blaine that he needed more help. Then 67, he was ready to start the succession process with Barry, who had loved every aspect of the family business since he was a boy, from driving the tractors that pull the floats to coordinating parade routes. He'd even embraced his dad's raising more than a million dollars to transport the USS Cabot, a 622-foot-long World War II aircraft carrier, to New Orleans, in hopes of creating a naval museum and casino. The hulk spent several years docked outside his tourist attraction, Blaine Kern's Mardi Gras World, but, Blaine says, gaming permits couldn't be secured and it was ultimately sold for scrap for $185,000.
When Barry became president, Blaine gave him a 48.7 percent ownership stake, keeping 50.1 percent. Barry, then 31, had made a name for himself creating props and design elements for Euro Disney in Paris and casinos in Las Vegas. With Barry and Naquin at the helm, the company made big moves--adding Universal Studios in Orlando as a client, creating floats for parades in Japan, Korea, and China, and moving Mardi Gras World into huge new facilities.
Blaine continued to be Mr. Mardi Gras--meeting with krewe officials, traveling to distant lands for inspiration, waving to crowds at parades. The act was so convincing that even insiders were fooled. "It took me about 12 to 15 years to realize that Barry was running the show," says Christian Brown, a top official with Rex. Father and son, meanwhile, didn't talk much about who was in charge. "The problem is, if you told Blaine that he hasn't been doing it, he wouldn't believe it," says Barry. Asked why, he shrugs. "There's reality, and then there's Blaine's reality."
Blaine's reality turned weirder in 2002, when he met Holly Brown, a buxom, blue-eyed blonde, a singer and dancer who was then 26--nearly 50 years younger than Blaine. (The two met, of course, at a Mardi Gras party.) They soon started dating. Holly had founded and ran a dance school, and managed a security-guard company her then-husband owned, but her dream was to make music. Once they became a couple, Blaine helped her produce several songs, including two on a compilation CD of Mardi Gras tunes sold at the company gift shop. On "Party Hardy, Mr. Mardi Gras," Blaine's voice is heard introducing Holly, who raps, "At just 19, he built a parade/Hollywood soon called his name/Nowadays we're glad he stayed/'Cause Mardi Gras, it wouldn't be the same!"
Of course, people talked.
"Somebody has to be the scapegoat," says Holly, now 39. "That's where I came into play." She also says age was never an issue for her and Blaine. "I'm an old soul," she says. "And he doesn't act anywhere near his age, so we meet in the middle." (Proving her point is Blaine's voice on Holly's voice mail, saying, "Yo, dog, you've reached Holly Wood!"--her stage name.)
Soon Blaine asked Holly to sell her dance school so he could take her traveling around the world; they've visited more than 70 countries. "That was a nice carrot he was dangling," she says. "You don't often have the opportunity to do that."
But Holly didn't do herself any favors by getting mixed up with reality-show producers who planned to cast her as a gold digger--and trumpeted the news on Facebook--until she nixed the project.
"She's not a gold digger," says Blaine, his voice rising, pointing out that Holly has saved his life several times--once in 2008, when he went into cardiac arrest and she performed CPR to get him breathing again. Since then, she has insisted that he eat right and hit the gym four times a week. (He'll flex rock-hard biceps to prove he's listening.) "If you're only after one thing," Holly says, "you're not going to waste 13 years of your life."
The lawsuit Barry eventually filed told a different story. "Soon after Blaine Kern Sr. began dating Holly Brown," it said, "personal expenditures on houses, cars, travel, and entertainment, and thus his debt, skyrocketed. Blaine Kern Sr. then began demanding advances of money from BKA (Blaine Kern Artists) and appeared at the offices of BKA almost exclusively to request money. Besides attempting to reason with his father, Barry Kern directly implored Holly Brown to stop badgering his father for more and more money, without success." (Holly denies badgering Blaine for cash, but says she encouraged him to stand up for himself in financial disputes.)
For years, Pixie Naquin kept the tension between Barry, his dad, and Holly in check. Respected by all--"I was the puppet," Blaine likes to say, "and Pixie was the puppeteer"--she was also on the three-person board of directors with Blaine and Barry, giving her the tiebreaking vote in any father-son dispute.
But in June 2010, Naquin died of cancer. It was a huge emotional blow--"Pixie was like a mom and a sister," says Barry--and now there was no buffer between Barry and his father and girlfriend. "Pixie was always watching Blaine's back," says Holly. "Now I was telling him, 'You need to know what's going on in the company,' and his son didn't like it."
Five weeks after Naquin died, Blaine and Holly tied the knot in Oahu, as a tall, big-eared balding man named Captain Howie spoke Sanskrit and blew a melody through a conch shell. The giddy newlyweds didn't tell Barry. He found out by watching a YouTube video that Blaine and Holly made to promote the company that produced the wedding. "I was surprised, but not surprised," says Barry.
Most families have a fierce desire for kinfolk in charge
- 85% of family-owned firms that have identified a successor say it will be a family member... but that dream usually does not come true.
- Slightly more than 30% of family businesses remain in the family into the second generation, and just 10 percent pass to the third generation.
Source: Cox Family Enterprise Center
And when it does happen, Mom and Pop may think Junior will need some help:
- Only 52% of family businesses believe that younger family members are qualified to take over without outside help, and 24 percent say they will use outside management to help the next generation run the business.
In most cases, there is no real plan:
- 65% of family-business owners will transition out of their role in the next five years without a formal succession plan.
Source: Ernst & Young
Then, in September, Blaine fired his son from Blaine Kern Artists--in a dispute over a parade contract, Blaine says. Barry denies this. "They were trying to put on a coup," he counters. With only him and his father left on the board of directors, Barry says, his father didn't have the two votes legally required to fire him. When Blaine is asked about that, Holly jumps in to answer for him, which frequently happened during a recent interview. "He owned a majority of the company!" she exclaims.
After being "fired," Barry resigned from the company and board with a stern, businesslike letter that began "Dear Dad" and was signed "Love, Barry." Many krewes, dreading the prospect of Blaine's running the company, stopped making payments. In October, Barry sued his father, claiming payroll checks had bounced, Blaine had furloughed some of the firm's 130 employees while continuing to raid the till, and the company was "technically insolvent." He asked the court to appoint a receiver to manage or dissolve the company. Each new twist lighted up newscasts and the local blogosphere, leading many to despair over the fate of Mardi Gras. One commentator suggested that Blaine Kern Artists "should be nationalized and placed under the control of an independent board, like the Sewerage and Water Board."
Then Blaine's old friend Pip Brennan of Bacchus hatched a plan to invite both Kerns to a secret meeting that would include leaders of Endymion and Rex--but not tell father or son that the other would be there. "My only agenda," says Brennan, "was, 'Guys, what the hell is wrong with y'all? Mardi Gras is bigger than all of us!'"
What happened next is the subject of some dispute. According to Barry, his lawyers and Blaine's legal team had already agreed that Blaine would sell all his shares in the company and receive a lifetime consulting contract. In return, Barry would drop his lawsuit, assume control, and pay Blaine's debts. Prior to the meeting, Barry says, he learned that Blaine would be there, so he called Blaine beforehand to say he would also be attending. Later that day, there would be legal documents for both to sign.
At the meeting, according to Barry and the krewe leaders, Blaine seemed happy and eager to resolve the crisis. Holly wasn't there, nor were any lawyers. "I was surprised Barry had all these documents, but they both signed them without a problem," says Brennan. "Blaine was in a good mood, and there was lots of hugging and kissing." Barry's team called the media, TV crews arrived, and it was the top story on the evening news. "It was a family feud that threatened to derail Mardi Gras," intoned the anchor gravely. "But tonight, it is over."
Not so fast. Today, Blaine says his lawyers never met with Barry's before the meeting and no deal had been made. Brennan's invitation, he states, was for just Blaine and Barry--no other krewe members, certainly no media. He was shocked to see the others there and says they all threatened him by claiming if he didn't sign these papers--which he had never seen--he would be blamed for ruining Mardi Gras. "They scared the hell out of me," he says. "I was completely ambushed."
Brennan, for decades a close friend of Blaine's, says, "I think when he went home and talked to his wife and attorney, he changed his entire attitude."
Mardi Gras went off without a hitch in March 2011, but in April, Barry sued again. His father had refused to sell his shares, Barry said, and continued asking for money, even demanding some from the cashiers at Mardi Gras World. Blaine responded that the agreement expired after Mardi Gras. "I signed it for that one season only," he says.
Judge Kern Reese ruled in Barry's favor. An appeals court sent the case back; Reese held hearings in April 2012. As Holly fought back tears in the gallery, Blaine said, "I signed the contract because I did not want to be known as the culprit who dragged Mardi Gras down. I hated myself at the time, but I was saying exactly what they wanted me to say because Mardi Gras belongs to me more than anybody else on planet Earth."
That line didn't go over too well with folks in New Orleans who believe that Mardi Gras doesn't belong to anybody--and especially not the mogul who's profited from it more than anyone else. Once again, Reese sided with Barry. "Blaine, you're 84 years old," sighed the judge, summing up the feelings of many. "You ought to make peace with your children."
Barry went back to running the company. For months, father and son didn't speak. Gradually, their business phone calls became more personal, and now genuine warmth has crept back into their relationship. "Even when I was pissed at him, I still loved him," Blaine says. "He couldn't sleep and I couldn't sleep. But we're finally putting this shit to bed."
In ruling against Blaine, Reese said he could not believe such a man could be pressured by the krewes into doing something he didn't want to do. That may have been true once, but today Blaine seems quite malleable. When he is with Holly, he blames Barry: "What my son did was unconscionable!" he thunders. When he is with Barry, he blames unnamed advisers: "It had to do with me, frankly speaking, looking back now, being given the wrong advice."
For months, both Kerns have been promising to announce a deal for Blaine to finally sell his 50.1 percent share to Barry. It's what the judge ordered, but Holly claims credit for steering Blaine that way: "I went to him and said, 'The reality is that you're almost 90 years old and you need to patch things up with your son. You can't correct what's been done. That's for God to judge.'"
The deal--while still unsigned at presstime--would let Blaine retain an honorific title so he can continue to be Mr. Mardi Gras. That seems to cheer both father and son. During lunch, Blaine rhapsodizes about fulfilling his lifelong dream of installing a vast gondola system across the Mississippi to connect New Orleans with his native Algiers--a dream briefly achieved at the 1984 World's Fair before weak traffic shut it down a few months later. Now some developers from Florida are interested, this time proposing 1,500 apartments for the western bank of the Mississippi. Blaine wants to hang a massive King Kong sculpture from smokestacks near the gondola landing at Mardi Gras World--like Kong climbing the Empire State Building--and another huge "Queen Kong" sculpture on the opposite side of the river.
"Barry, those guys in Florida can do this--it can't miss!" Blaine cries.
"At the end of the day, it's all about the metrics, whether you can get it funded," Barry says.
"I've been dreaming of doing this, God almighty, since before the World's Fair," says Blaine. "Think of King Kong hanging on those smokestacks!"
Over dessert, Blaine turns reflective, saying he prays for forgiveness every night. "I've been such an ass in my life, a bad ass, I know that, so I'm hoping that God looks down and says, 'He's not a complete asshole.' I mean that. I'm not joking about that."
When Barry drives Blaine home to Holly, father and son get out of the car, hug, and exchange kisses on the cheek. "Bye, son," Blaine says. Then Barry drives home to his wife, Tina, and the youngest of their three sons, 17-year-old Patrick. Like his dad, Barry is encouraging the kids to go into the family business. Kern Studios is still small, he says. The next generation can continue its global expansion and cater to the nearly limitless human craving for spectacle.
Patrick, a clean-cut boy who politely answers a reporter's questions, says he is very interested. He started sweeping floors at age 8 and learned papier-mâché skills at 11. This summer he'll join Barry on a business trip to Asia. "This is always what I've had in mind, what I'm going to do," he says firmly.
His father smiles proudly, dreaming of a bright and happy Kern-family future, just as Blaine did when he was grooming his own son to take over, before the treachery began. "Ever since he was little," Barry says, "the guys in the warehouse have been saying, 'We're going to be working for Patrick someday.'"