The secretive billionaire genius behind Beanie Babies has a business reputation as anything but a teddy bear.
People who know Ty Warner, the brand’s founder, said he’s a stubborn eccentric who wants things done his way — or else. Now, he toying with his reputation by putting two landmark hotels he owns on ice but not making it clear why.
Mystery surrounds the 78-year-old decision to shutter both the iconic Four Seasons Hotel in New York as well as the Four Seasons Biltmore in Santa Barbara. He closed them at the start of the pandemic in 2020 and it was expected they’d re-open a few months later when most hotels did. Instead, Warner is apparently battling Four Seasons management, which doesn’t own the hotels under its banner but operates them for the owners.
Besides those two hotels, Warner also owns the Kona Village Resort in Hawaii, Las Ventanas al Paraiso resort in Los Cabos, Mexico, and the famed San Ysidro Ranch in Montecito, Calif. — which has hosted the weddings of Gwyneth Paltrow and Chris Martin, Chris Pratt, and Katherine Schwarzenegger, and Vivien Leigh and Laurence Olivier. John F. Kennedy honeymooned there with his wife Jackie.
Ty Warner is the man behind Beanie Babies — one of the biggest phenomenons in American toy history.The LIFE Images Collection/Getty Images
Warner is feuding with an ex-girlfriend, 85-year-old Kathryn Zimmie, who lived with him at his $400 million Montecito home for years, accusing him of abuse. Corbis via Getty Images
But, in sharp contrast to his success with stuffed animals, Warner has lost so much money on his hotel and resort business that he went 12 years without paying a dollar in federal income taxes, ProPublica reported last year.
He’s also feuding with an ex-girlfriend, 85-year-old Kathryn Zimmie, who lived with him at his $400 million Montecito home for years. Zimmie filed suit against Warner in 2021, accusing him of years of abuse.
Warner denied the claims through his lawyer.
“He can be quite aggressive and set in his ways,” a source very familiar with Warner told The Post. “You’re talking about someone who had a startup selling stuffed animals at a price point nobody said would fly — and he became the richest man in the history of toys. Once you’ve done that you’re not inclined to listen to anyone else.”
Warner has kept New York City’s legendary Four Seasons hotel closed rather than pay hefty upkeep fees.
Getty Images
In response, the hotel chain has rebuffed his request to adjust fees to be commensurate with the hotel’s profitability or lack thereof, according to sources.
Helayne Seidman
The Four Seasons battles are an odd third chapter for Warner, who is said to be something of a recluse.
Both hotels have gone dark, with no known date to re-open. Warner and the Four Seasons have been sparring for the past 18 months or so over the Manhattan hotel per a contract clause covering dispute resolutions, The Post reported last week.
In New York, the fight reportedly involves Warner’s reluctance to pay the hefty upkeep fees demanded by Four Seasons management. In response, the hotel chain has rebuffed his request to adjust fees to be commensurate with the hotel’s profitability or lack thereof, according to sources, who added that the feud could go on for years, leaving the legendary 57th Street space an eerie shell.
“There are 368 rooms in that luxury hotel sitting empty,” a source who worked with Warner in the hotel business told The Post. “I don’t know what the end game is. I assume there are a handful of security and maintenance people on hand in case something goes wrong with the pipes or to keep people from breaking in. I wonder if they have housekeeping going into those rooms to clean the dust from time to time.”
He also owns the Four Seasons Biltmore in Santa Barbara, Calif., which, like its NYC counterpart, is sitting stagnant.
In Santa Barbara, meanwhile, locals are mystified why the Four Seasons Biltmore — a five-star, celebrity favorite resort tucked between the Pacific Ocean and the Santa Ynez mountains — has not re-opened.
Warner is fighting Santa Barbara tax collectors saying they charge him too much while facing lawsuits — adding up to at least $6 million — brought on behalf of 450 Biltmore employees who’ve been placed in unpaid limbo since March 2020.
Attorney Bruce Anticouni, who represents the plaintiffs, told The Post on Wednesday that when the Four Seasons Biltmore shut down in March 2020, employers were told they were being placed on temporary furlough and would be reinstated. In June 2020, right when other hotels were re-opening, the employees’ health insurance was canceled.
One of many keys to the Beanie Babies’ success was Warner’s decision to deliberately under-stuff the toys to make them more huggable.San Francisco Chronicle via Getty Images
“It’s terrible,” Anticouni told The Post. “There have been a lot of sad stories. A lot of employees losing their houses, divorces, and at least one suicide. The company takes the position that they are still employed and will come back at some point — but we’re not seeing evidence of that. It’s been close to 1,000 days already.”
The Four Seasons battles are an odd third chapter for Warner who is said to be something of a recluse. A college dropout from suburban Chicago, in 1985 he leveraged a Midas touch as a salesman when he began manufacturing cheap stuffed animals in China for 30 cents — then selling them for $2.50 to independent gift stores who in turn marked the toys up to $5.
One of many keys to the Beanie Babies success was Warner’s decision to deliberately under-stuff the toys to make them more huggable.
Beanie Babies with names like Chops the lamb, Chocolate the moose, and Speedy the turtle flew off store shelves all over America between 1996 and 2000.
Time & Life Pictures/Getty Image
By 1998, the company was bringing in $1.4 billion.
Getty Images
The Beanie Baby craze, which inspired a collecting frenzy, was powered in part by a 1999 People magazine article.
AP
Warner also owns in the opulent Kona Village resort in Kailua-Kona, Hawaii. Tribune News Service via Getty Images
Between 1996 and 2000, Beanie Babies with names like Chops the lamb, Chocolate the moose, and Speedy the turtle flew off store shelves all over America. By 1998, the company was bringing in $1.4 billion.
The Beanie Baby craze, which inspired a collecting frenzy, was powered in part by a 1999 People magazine article written by Joni Hirsch Blackman, and a group of Naperville, Ill., soccer moms who helped fuel a thriving black market for the toys and drove prices even higher.
Hirsch Blackman remains the only person to have scored an interview with Warner. The Post was unable to reach him, and his attorney did not respond to a request for comment.
Among Warner’s resort properties in San Ysidro Ranch in Montecito, Calif., where celebrities like Gwyneth Paltrow wed and John F. Kennedy Jr. and wife Jackie honeymooned.Corbis via Getty Images
“I knew I had a winner,” Warner told People in 1999 when he was trying to keep up with a 1,000% increase in orders from the previous year.
Warner was anything but an easy boss — as illustrated in Zach Bissonnette’s 2015 book, “The Great Beanie Baby Bubble: Mass Delusion and the Dark Side of Cute” and in last year’s “Beanie Mania” documentary on HBO Max.
“He had his staff up until 4 a.m. debating what color of ribbon the rabbit would have,” said a source familiar with Warner’s years with Beanie Babies. “They would finally arrive at the color and the employees would think they could finally go home. Then Ty would say, ‘Wait, what if you changed the way you tied the ribbon on the rabbit?’
Sources who know Warner say he’s a stubborn eccentric who wants things done his way — or else.Getty Images
“He may be bringing that kind of insane focus on aesthetics to the Four Seasons hotels,” the source added. “In which case, he could be making decisions that could go on for years.”
Bissonnette’s book detailed Warner’s tough childhood and strained relationship with his parents, Harold, a toy salesman, and Georgia, who was diagnosed as a paranoid schizophrenic in the 1970s.
Warner’s lawyers cited those difficult early years when he was brought up on tax evasion charges in 2008. Federal prosecutors said Warner had been stashing up to $107 million in an offshore account with UBS since 1996.
Patricia Roche dated Warner (right, next to former Harrods owner Mohamed Al-Fayed) and ran the UK arm of his company for a while.Sue Owne/ Chreish
In 2014, he ended up being sentenced to two years probation plus community service, and paid a $53 million fine, but served no time. Warner’s philanthropy — he’s raised millions of dollars for charity and donated millions more — was a consideration when the court decided his punishment.
However, Warner’s girlfriend of more than 20 years did not describe him as charitable in the suit she filed against him last year, instead making it sound as if life with the billionaire was a horror show.
In a complaint filed in Santa Barbara Superior Court, Zimmie said she had “fled” the luxe Montecito estate she shared with Warner “out of fear for her well-being and safety,” leaving behind all of her clothing and personal possessions.
Warner — who reportedly named most if not all of the Beanie Babies — dubbed one “Patti the Platypus” after his ex, Roche.
According to the suit, Zimmie alleged that when she said she was leaving Warner, he placed his hands around her neck and told her, “I wouldn’t do that if I were you.”
“Warner squeezed Zimmie’s throat so hard that she realized that her life was in danger if she ever left him,” the lawsuit alleges.
When Zimmie began using a cane, it apparently annoyed Warner. He’d allegedly hide the device from his girlfriend and then scold her if she had to steady herself with walls and objects around the home.
Warner has been accused of abuse by his ex-girlfriend Kathryn Zimmie.ZUMAPRESS.com
Warner allegedly reprimanded Zimmie for not finishing her meals and coughing excessively. If she went to another part of the estate, Warner would shout “Katie! Katie! Katie!” until she returned to his side, the complaint states.
Kathryn Zimmie’s daughter told The Post her mother did not wish to comment.
Warner has had several relationships in addition to Zimmie — including with Patricia Roche and Faith McGowan, who were both involved in the operations of Ty, Inc., the company behind Beanie Babies — but never married nor does he have children.
He and his original right-hand woman, Lina Trivedi named most if not all of the stuffed animals, according to Bissonnette’s book. Warner dubbed one of the Beanie Babies “Patti the Platypus” after his ex Roche, who also ran the company’s UK business for a while.
Zimmie and Warner lived together at his Montecito, California mansion.
Warner is still manufacturing Beanie Babies, and the latest ones can be seen on his website, ty.com.
While he owns the luxurious home in Montecito, he is usually based in Oak Brook, Ill., insiders said.
“He is not all bad,” said the source familiar with Warner’s early years with Beanie Babies. “He was obsessed with making working conditions better in the China factories that made the animals. He wanted them to be lit better. At the end of the day, he’s actually an artist. He has a real eye — and the artist’s tendency to fixate.”
Source link: https://nypost.com/2022/10/08/dark-side-of-ty-warner-the-billionaire-behind-beanie-babies/