Rudy Can Fail?
Ever hear of Lighting Science Group? Did not think so. Says here it's "a world leader in the rapidly developing field of solid state lighting," and for all we know the McKinney Avenue-HQ'd company may be just that. Forbes, though, is a little skeptical--something to do with this being the third incarnation of Ronald Lusk's company, which is publicly traded on the Over-the-Counter Bulletin Board (the home of risky, low-yield investments). So why should so small a company get Forbes' attention--and in a giant subscription-only feature story, no less?
Because of its connection to Rudy Giuliani, that's why--Giuliani, "the closest thing in America to a mythic hero," writes Nathan Vardi, who clearly isn't sharing what he's smoking. Turns out Lighting Science Group has a deal with Giuliani Partners, described in the magazine as a "management consultancy that...has nabbed tens of millions of dollars in contracts and deals." But Forbes isn't terribly impressed with Lighting Science Group; it's a member of the "sketchier crowd" referred to in the story's headline, which details the company the former NYC mayor's keeping these days as he makes a push for a larger national political profile, if such a thing is possible. Forbes' problem with the company, and with Giuliani's deal with Lighting Science Group, is after the jump. So too is the explanation about how Giuliani got a law office in Dallas. --Robert Wilonsky
Giuliani has continued to permit those closest to him to drag his name into potentially compromising situations. Example: the agreement with Lighting Science Group, a Dallas firm whose shares trade on the o-t-c bulletin board. The deal came to Giuliani last year through Roy W. Bailey, the former finance chairman of the Texas Republican Party and current Giuliani Partners managing director. "I have known Roy for 20 years," says Ronald Lusk, Lighting Science's chief, who agreed to pay Giuliani Capital, for help in raising money and finding clients, $150,000, plus a warrant to purchase 1.6 million shares at 60 cents.
Shares of the company, which proposes to finance LED (light-emitting diode) lights for parking garages, recently traded for 25 cents. Lighting Science and Giuliani Capital have also set up a joint venture to split whatever energy savings parking garages eke out on their utility bills from LEDs the company gives them gratis. This is the third incarnation of Lusk's enterprise (it lost $412,000 on $137,000 of revenue for the six months ending June 30): It started out as a nursing home operator, then morphed into a data management business that wound up in bankruptcy court in 2002 before finding new life in lights. "We like the technology," says [Steven D.] Oesterle[, a partner and managing director of the firm]...
Giuliani is still renting out his name. But these days it's with a political goal in mind. Last year he signed on as a senior partner at a Texas law firm known for its energy sector work and ties to the Republican Party. Bracewell & Patterson got something out of it, too, besides a name change (to Bracewell & Giuliani): a branded New York office. Giuliani joined the nation's 121st-largest law firm, in terms of revenue, and copped a fee that Lynn Mestel, a legal recruiter, estimates at $1 million a year. And he gained something much more valuable. "The alliance with law groups in Texas gives him a network he didn't have," says Frederick Siegel, a former Giuliani campaign consultant and biographer. "It's the contacts he is making that are going to be the backbone of the presidential campaign."
Get the This Week's Top Stories Newsletter
Every week we collect the latest news, music and arts stories — along with film and food reviews and the best things to do this week — so that you'll never miss Observer's biggest stories.