Holding the Torch for His Workers

“Everyone asks me, ‘Why in the world are you doing this?’ ”

Anthony Maglica and I were chatting in a conference room at the Ontario headquarters of his Mag Instrument Inc., next to a showcase displaying examples of the company’s line of aluminum flashlights that had been bombed, crushed and otherwise tormented and had still kept working, like the Timex watches in the old commercials.

The topic at hand wasn’t the remarkable durability of Maglites (although their quality is a byword), but Maglica’s decision to sink $80 million into a new California factory and to roughly triple his local workforce to more than 2,400.

It would be gratifying to say that Maglica’s plans disprove the state’s reputation for hostility to industry, but that wouldn’t be the case. The 75-year-old Yugoslavia-raised entrepreneur sometimes sounds as though he’s expanding here not to take advantage of local conditions, but to spite them. His complaints about the business environment resemble those of other business leaders -- taxes, workers’ compensation, regulation -- but he has unusual flexibility in dealing with them: As an entrepreneur spending his own money, he can do as he pleases.

“If I was working for a public company, I’d probably be fired,” he says in his heavily accented English. “They’d make me go overseas so I could make more profit. But what would I do with the people who worked with me for 40 years and built their homes here? My conscience would bother me. They helped me to build the company.”

Born in New York and taken by his immigrant mother back to her native land before he was 2, Maglica returned to the U.S. in 1950 as a machinist and eventually ended up working in Los Angeles. Using a metal lathe he had purchased with a $125 down payment, he turned out machine parts on order and soon had enough business to quit his day job. He founded Mag Instrument in 1955, and in 1979 introduced the original aluminum Maglite flashlight at a series of trade shows. Today Mag Instrument pulls in more than $100 million a year from at least a dozen flashlight models, ranging from a key-ring version to a six-battery behemoth, beloved by police and military personnel, with the heft of a shillelagh.

The basic design hasn’t changed much since the first Maglite became an instant hit. Maglites are among those man-made objects in which form flawlessly fits function. Their weight, the action of their moving parts, even the cool temperature of their aluminum bodies all feel just right.

On his way up Maglica won a name for toughness, whether in business or personal affairs. His dispute with the former Claire Halasz, who lived as his companion for 20 years, was the stuff of hard-knuckled business legend. He lost a huge palimony case to her before settling for $29 million, but then sued her two sons, alleging that they stole his trade secrets to set up their own flashlight company. In that case he won an injunction and a $1.2-million judgment.

He also has filed dozens of lawsuits in a no-quarter-given campaign to protect his patents and his flashlights’ unique look and feel. Just last month, he won a judgment against IKEA International, which was marketing a Maglite knockoff. Maglica spent some $585,000 to win $44,000 in damages from the Swedish retailer. (IKEA was ordered to pay his legal fees.)

That hints at why his determination to stay in California sets him apart. “I’m not doing this for the money,” he says. “If I was doing it for the money I would move to China.”

He says he started mapping out his new highly automated facility, which is scheduled to be completed in June 2006, about 10 years ago. “When we started to plan, people came from Colorado, Tennessee. They offered me land for $1 a year.” He says he turned them down for the same reason he rejected a lucrative buyout offer from a suitor who planned to move manufacturing to China or Mexico: It would mean abandoning his workers.

There’s a hint of perverse pride in Maglica’s determination to expand locally, as though he wants to show there’s no challenge too daunting for him.

His iconoclasm has meant missing out on industrial development handouts that more bottom-line-oriented executives would never let pass; when he originally planned the expansion, industry-hungry Ontario offered him property tax rebates and other blandishments. Instead of forging ahead, Maglica put the expansion on hold, at least partially because of his domestic fight. When he revived the project last year, the city’s industrial vacancy rate had fallen so low that the deals had expired. Maglica went forward anyway.

Maglica isn’t the type of businessman who tries to extract public concessions by threatening to leave the state or lay off workers. Although he says energy costs are among his biggest concerns and Southern California Edison Co. is proposing an “economic development” power discount of up to 25% for big customers, it’s not clear he would qualify for the break. The reason is that only companies that certify that they will relocate or reduce their workforce without the discount will be eligible, and Maglica has made it clear that he intends to stay, no matter what. (Edison says it will work with him in other ways to help cut power costs at the new plant.)

The only question is what might happen to Mag Instrument in the post-Tony Maglica era. Although he’s grooming his sons to eventually take over, there’s no guarantee that they

or their heirs will be able to resist the financial temptations that the founder has turned away. Maglica dismisses such concerns as hopelessly speculat-

ive.

“I don’t think that I’ll ever die,” he says. “Sounds crazy, doesn’t it? Almost as crazy as doing business in California.”

Golden State appears every Monday and Thursday. You can reach Michael Hiltzik at golden.state@latimes.com and read his previous columns at

latimes.com/hiltzik.