Lawmakers seek Geithner help in saving Hartmarx

U.S. lawmakers are seeking Treasury Secretary Tim Geithner's help in persuading Wells Fargo & Co. not to liquidate Hartmarx Corp., the 122-year-old clothing company that has made suits for President Barack Obama.

Representative Phil Hare said yesterday that more than 30 members of Congress, including House Financial Services Committee Chairman Barney Frank, will join him in asking Geithner to pressure Wells Fargo to entertain bids for the bankrupt company instead of closing it down. The lawmakers are drafting a letter with the request.

"We're asking him to call Wells Fargo and tell them not to liquidate," said Hare, an Illinois Democrat and a Hartmarx employee for 13 years before his election to Congress.

Wells Fargo, which received $25 billion in federal assistance from the government's Troubled Asset Relief Program, has been under pressure from lawmakers and unions not to close the clothing company.

"We went out of our way to help you when you needed us," Hare said he told company officials in a conference call yesterday. "I'm asking them to do the right thing."

A statement by the bank called the financing issues "internal business matters" that must be resolved by Hartmarx itself.

"Wells Fargo works with its customers who are having financial difficulties whenever circumstances prudently permit," the bank said. "We want them to stay in business."

Bankruptcy Filing

Bank spokeswoman Susan Stanley declined to comment further.

Chicago-based Hartmarx, which has facilities in Des Plaines, makes suits under brands including Hickey-Freeman and Hart Schaffner Marx. The company filed for bankruptcy on Jan. 23, blaming declining sales of its luxury goods and an inability to borrow money.

Hare said Wells Fargo is responsible for the company's bankruptcy because the bank, the nation's fourth-largest, refused to extend credit.

"This wasn't a mismanaged company," Hare said.

Wells Fargo said the company is in default on more than $114 million in loans and that it provided Hartmarx with $20 million in financing after the bankruptcy filing.

The bank said it is continuing to work with Hartmarx to find potential buyers, but it can't lend the company more money.

"Advancing more funds with no reasonable likelihood of being repaid is not consistent with sound banking," Wells Fargo said.

Hare said he would like to have a sale of the company arranged in the next couple of weeks and that he also is contacting White House Chief of Staff Rahm Emanuel to enlist the help of another one of Hartmarx's customers.

"I think the president needs to weigh in on this," Hare said.

"We have not commented," White House spokeswoman Jen Psaki said in an e-mail when asked for a response.

<div class="infoBox"> <h1>More Coverage</h1> <div class="infoBoxContent"> <div class="infoArea"> <h2>Video</h2> <ul class="video"> <li><a href="/multimedia/?category=9&type=video&item=342">Protest at Des Plaines business</a></li> </ul> <h2>Stories</h2> <ul class="links"> <li><a href="/story/?id=291983">State official threatens bank in suitmaker's bankruptcy <span class="date">[05/07/09]</span></a></li> <li><a href="/story/?id=291557">Suitmaker's employees take plea to president <span class="date">[05/06/09]</span></a></li> </ul> <h2>Related documents</h2> <ul class="morePdf"> <li><a href="/pdf/wellsfargo.pdf">Letter from State Treasurer Alexi Giannoulias to Wells Fargo</a></li> <li><a href="/pdf/obamahsm.pdf">Obama: A fashion role model </a></li> </ul> <h2>Related links</h2> <ul class="moreWeb"> <li><a href="http://www.hartmarx.com/history.htm">Company history </a></li> </ul> </div> </div> </div>