John G. Schwegmann

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John Gerald Schwegmann, Jr., (August 14, 1911 - March 6, 1995) was a pioneer in the development of the modern supermarket. He owned eighteen stores in the Greater New Orleans area, based from Metairie, a large unincorporated city in Jefferson Parish. He was also active in Louisiana politics, having served in the state House of Representatives from 1960-1968, the state Senate from 1968-1972, and the Louisiana Public Service Commission from 1975-1980. He was a political maverick who also mounted an unconventional -- and unsuccessful -- campaign for governor in the 1971 Democratic primary.

1 From humble beginnings
2 Launching a supermarket chain
3 Schwegmann as public service litigant
4 The fight against milk price-fixing
5 Legislative career
6 Two ex-wives die three days apart
7 Turning the company over to his son
8 An unconventional gubernatorial campaign
9 Two other political Schwegmanns
10 Schwegmann in retrospect
11 References

[edit] From humble beginnings

Schwegmann was born above his father's small grocery store, Schwegmann's Grocery and Bar, located at the intersection of Burgundy and Piety streets in New Orleans's Ninth Ward. His German-born grandfather had founded the store in 1869. The business was later commemorated by Schwegmann's Old Piety & Burgundy Whiskey. In the early years, the store had no heat in the winter, and the front doors were left open, often allowing cold wind to blow into the business. John Schwegman reflected that "If the clerks complained, they were told [that] heat would make them drowsy and that it would take the bloom off the fruits and vegetables, even though olive oil was freezing and breaking on the shelves. However, the real reason for keeping the doors open was to show that the store was open and ready for business."

Schwegmann's formal education was limited to grammar school, a year at Holy Cross Catholic High School, and six months at Soule College. He worked for the U.S. Post Office and as a salesman for a margarine manufacturer. He took a job with Canal Bank & Trust Co., which closed in 1933. He worked in real estate until 1939, when he joined his father's store.

[edit] Launching a supermarket chain

World War II interrupted his business career. Thereafter, on August 23, 1946, he and two brothers, Anthony Schwegmann and Paul Schwegmann, opened the first Schwegmann Brothers Giant Super Market, located on St. Claude Avenue near the intersection of Elysian Fields Avenue. The operation in time grew to eighteen stores with 5,000 employee. Schwegmann's massive modern supermarket sold everything from gourmet food to garden supplies.

The Schwegmanns revolutionized grocery shopping in New Orleans, and their outlets soon mushroomed. By 1957, there were Schwegmann stores, large in size, all over New Orleans. The largest store was the one on Old Gentilly Road. At the time, it was the biggest supermarket in the world -- a staggering 155,000 square feet. The supermarket attracted both customers and onlookers, who came by tour busses to see the structure.

"He was the first person to take us past the mom-and-pop business into the supermarket business," said his son, John F. Schwegmann (born 1945), the chief executive officer of the privately held chain from 1979 until the company was sold in 1997.

"Everything he's touched has turned to money," said Saul Stone, one of Schwegmann's attorneys, in a 1979 interview. "He's some lucky kind of guy." Stone added that "The best way to success was volume with a low markup. He [John Schwegmann] said [that] he would rather make $100 off $1,000 in sales than make $50 on $100 sales."

The Schwegmanns introduced New Orleans to self-service shopping, then a novelty that eventually became an ordinary feature of American life and doomed the smaller stores in which proprietors filled each customer's order. For a time, the Schwegmanns still offered full service for traditional shoppers, but they encouraged customers to gather their own items from the shelves and to take their baskets to the checkout counter. While this innovation was not initially well received, shoppers accepted the idea quickly so that they could obtain a 10 percent discount if they helped themselves.

"There are richer and smarter people in the world than I am, but they're no better," the self-confident Schwegmann said in an interview a generation after he opened his first supermarket. "We're all selling something to someone else. . . . I never look down; I always look up."

He also founded Schwegmann Bank & Trust Co., which was later purchased by Jefferson Guaranty Bank.

[edit] Schwegmann as public service litigant

In 1948, Schwegmann entered a new field of activity: litigation. The Louisiana legislature had passed a law requiring a minimum markup on alcoholic beverages at all levels of the merchandising chain. Schwegmann was convinced that stores should be able to set their own prices. He volunteered to be the plaintiff in a test case to oppose the law, and Stone agreed to represent him. "That made him a litigator," Stone said. "He liked it. He wanted to fight."

The Louisiana Supreme Court declared the markup law on alcohol unconstitutional.

Schwegmann's next fight was against the state's fair-trade law, which permitted manufacturers to set retail prices for an entire area by entering into a contract with just one retailer in that region.

The crusade was successful in the U.S. District Court , the Fifth Circuit Court of Appeals in New Orleans, and the U.S. Supreme Court. While the Supreme Court did not technically strike down the law, it held that merchants could not be forced to charge certain prices.

"The next move was to get the state's fair-trade law thrown out," Stone said. "It was. A second law was passed, but the state Supreme Court threw it out in 1965."

In 1965, state Revenue Collector Ashton J. Mouton sued Schwegmann Brothers to collect for the state sales, use and occupational license taxes plus interest in the amount of $62,517.98. Schwegmann appealed the assessments to the Louisiana Board of Tax Appeals. Ten years later, the tax board ruled in Mouton's favor, some five years after he had left the collector's position. Thereafter, Mouton sued to collect another $103,290.59. Schwegmann answered and denied liability. The two cases were consolidated in the trial court by consent of the parties. In the trial, Mouton was upheld in both cases.

[edit] The fight against milk price-fixing

Perhaps Schwegmann's best-remembered fight was his battle against milk price-fixing. It pitted him against, first, the state agriculture commissioner, Dave L. Pearce, and, later, the state Milk Commission, which could set milk prices at the processing and retail levels, said Michael R. Fontham, another Schwegmann attorney.

The federal suit, which grew out of Schwegmann's attempts to import cheaper out-of-state milk, was in litigation for eight years, Fontham said. Finally, a three-judge panel said that Schwegmann could not be barred from buying cheaper milk.

After that, the state eliminated the Milk Commission. It was replaced in 1975 by the Dairy Stabilization Board, which can prescribe a minimum price processors must pay to farmers.

One out-of-state company from which Schwegmann bought milk was Dairy Fresh Corp., an Alabama firm with a processing plant in Hattiesburg, Mississippi. Louisiana health officials tried to impound the milk, Fontham noted, but eventually Schwegmann was allowed to bring it into the state.

Such battles were "altruistic," Stone said. "He favored unrestricted, free competition. It's principle, nothing personal with it. He had nothing to gain at all."

[edit] Legislative career

Schwegmann's political career actually began as early as 1955, when he lost a primary for a Jefferson Parish seat in the state Senate. After an unsuccessful campaign in 1959 for the Jefferson Parish presidency (an administrative position equivalent to a county commission chairmanship), he won a seat in the state House of Representatives in 1961. In 1968, he was elected to the state Senate, and in 1975, he was elected to the Public Service Commission.

In the legislature, Schwegmann declared his independence and acquired the reputation of a maverick. Because of his crusades and feuds, many of his bills were not voted upon or rejected outright. In a 1962 speech, he said, "How can you win with a stacked house? I came out fighting, and at least I was loyal to the people."

Schwegmann became a persistent critic of the administrations of his fellow Democrats, Governors Jimmie Davis and John Julian McKeithen, and he acquired a wide variety of enemies. Former New Orleans Mayor Maurice "Moon" Landrieu, another fellow Democrat, once declared that Schwegmann was "so poorly informed on the governmental process, you have to excuse him on the basis of ignorance." On several occasions thereafter, the Landrieus and Schwegmanns would find themselves fighting each other politically.

In the legislature, Schwegmann voted against such measures as pay raises for public officials and tax increases. He also opposed building the popular Louisiana Superdome with state bonds. The original estimate of the cost of the stadium was $35 million, but years before it was finished, Schwegmann predicted that it would cost between $150 million and $200 million. The final cost was $179 million.

The Superdome was one of McKeithen's pet projects, and the governor tried to use his legendary charm to win Schwegmann over to his side. During one exchange, McKeithen said, "Now, John's going to be reasonable about this. After all, we can help him. John, what can we do for you?"

"Governor, you can't do nothin' for me," Schwegmann replied.

[edit] Two ex-wives die three days apart

Schwegmann was twice married and twice divorced. He outlived both wives by ten months, and the ex-wives died within three days of each other.

Schwegmann wed the former Mary Elizabeth Geisenheimer (May 22, 1917 -- May 27, 1994) of Metairie in the mid-1940s, and they divorced shortly after she gave birth to his two sons, John F. Schwegmann and Guy Schwegmann, who was born with a development disorder. A native of New Orleans, Mary Schwegmann met her husband at a dance school. She worked as a cashier in the company's first supermarket. After the divorce, Mrs. Schwegmann devoted herself to raising her two sons. John F. Schwegmann said that his mother was "not a socialite or what you would call a big civic mover. . . . Guy needed a lot of special attention, and all f her civic involvement was toward the mentally retarded." The first Mrs. Schwegmann devoted much of her time to the Magnolia and the Louise Davis schools. In her later years, Mary Schwegmann developed an almost maternal relationship with John F. Schwegmann's half-sister, Margaret "Margie" Schwegmann-Brown, a daughter from her former husband's second marriage.

Schwegmann's second wife was the former Melba Margaret Wolfe (August 24, 1926 -- May 30, 1994) of Metairie. She died in Touro Infirmary on the same day as the funeral of Mary Schwegmann. The second Mrs. Schwegmann was also a native of New Orleans and a graduate of Eleanor McMain High School. She met John G. Schwegmann while she was working for the Bell telephone company, and he was launching his grocery chain. They were married in 1951. Mrs. Schwegmann and her former husband remained close after their marriage ended. At the time of her death, she had been ill for a number of years.

Schwegmann's last court battle involved a $30 million suit filed in 1979 by Mary Ann Blackledge, a former clerk in a Schwegmann's store, who claimed that she and the supermarket magnate had cohabitated as husband and wife for 12 years in a common-law arrangement. She sought $30 million as her share of the wealth they had accumulated while they were together.

In 1982, state District Judge Frank V. Zaccaria ruled that Blackledge could not file such a suit unless she had a written contract. He said that she could, however, sue to recover money that she may have spent in business relationships with Schwegmann, but she never brought forth a suit of that nature

[edit] Turning the company over to his son

After Schwegmann suffered strokes in 1977 and 1978, he turned over control of his supermarkets to his son. He resigned from the PSC in October 1980. John F. Schwegmann was, likewise, elected public service commissioner and continued in his father's footsteps.

John F. Schwegmann bought out other companies, including 28 National Tea Co. outlets. He added these 28 stores to the 18 other Schwegmann locations in 1995. However, a year later, after much financial trouble, the Schwegmann chain was sold. Schwegmann's relatives, including his half sister, sued him for damages because of his alleged mismanagement.

It was once said that only in New Orleans can one become emotional about a grocery store because people in the Crescent City do take their food very seriously.

[edit] An unconventional gubernatorial campaign

Schwegmann was an outspoken conservative, particularly on matters of economics and government reform. He used his grocery store advertisements to espouse his political views. He often used pithy expressions, witty statements, or philosophical insight in an attempt to convince his customers to adopt his political views. He spoke out on a plethora of issues, including price-fixing, the Pentagon Papers, taxation, and the Louisiana Superdome. He set forth his opinions in mini-editorials that were part of the advertising for the grocery chain. He printed the names of candidates that he supported on the company's shopping bags.

He did not to seek a second term in the state Senate but chose to run for governor in a bid to succeed the term-limited John McKeithen.

Schwegmann selected a state House colleague, Representative Parey Pershing Branton, Sr., of tiny Shongaloo in Webster Parish. Schwegmann, who had served with Branton in the House when both were freshman legislators, came from about as far south in Louisiana as one could live, and Branton came from the far northern portion of the state. Geographically, if not philosophically, the Schwegmann-Branton ticket spanned the length of the Bayou State.

Schwegmann campaigned throughout the state but was unable to sway voters. Though his advertising made him appear to be bombastic, outspoken, and extroverted, he was the opposite on the campaign trail: meek, introverted, almost shy in meeting strangers. He received only 92,072 votes, a weak fifth-place showing. The fiscally conservative message plugged by Schwegmann and Branton was moreover rejected statewide. The three top candidates for governor, Schwegmann's state Senate colleague, J. Bennett Johnston, Jr. of Shreveport in Caddo Parish, then Congressman Edwin Washington Edwards, of Crowley in Acadia Parish, and former Congressman (later to return to Congress) Gillis William Long of Alexandria, were all identified with the "moderate" wing of the party. Only fourth-place candidate, former Governor Jimmie Davis was considered more in the "conservative" faction of the dominant Louisiana party.

Schwegmann, however, did run nearly 5,000 votes ahead of another conservative primary candidate, three-term Lieutenant Governor Clarence C. "Taddy" Aycock of Franklin in St. Mary Parish, who floundered badly in his gubernatorial campaign. Edwards and Johnston went into the second primary, which Edwards won by a close vote. Edwards then defeated Schwegmann's Jefferson Parish neighbor, Republican David C. Treen in the March 1972 general election. Parey Branton, meanwhile, barely registered in the lieutenant governor's race: he left state politics and later served 18 years as mayor of Shongaloo.

[edit] Two other political Schwegmanns

Two members of his family have demonstrated the same interest in government service: Melinda B. Schwegmann, his daughter- in-law, was the first woman to serve as lieutenant governor (1992-1996), and John F. Schwegmann was his father's successor on the state Public Service Commission, having served from 1981-1996.

[edit] Schwegmann in retrospect

The sale of the Schwegmann chain had a big impact on the economy of New Orleans. The company ceased to exist in 1996, a year after John G. Schwegmann's death. John F. Schwegmann claimed no responsibility for the failure of the company. He compared his situation to "no good deed" going "unpunished." His half-sister, Margie Schwegmann Brown, and 200 retired Schwegmann employees launched separate lawsuits against John F. Schwegmann in the years after the company's demise. Each won multimillion-dollar judgments against him.

Prior to his death, John G. Schwegmann had been in poor health for several years after a second series of strokes. He died in Touro Infirmary, as did his second wife.

Survivors included the two sons by his first wife, John F. Schwegmann and Guy G. Schwegmann; a daughter from his second marriage, Margie Schwegmann-Brown; a brother, Anthony Schwegmann; a sister, Marguerite Barrios; and three grandchildren, John G. Schwegmann, III, Heidi Schwegmann, and Laurie Schwegmann.

A mass was said at noon, March 8, 1995, at Holy Trinity Catholic Church at 721 St. Ferdinand St. The historic church has since closed because of declining attendance and termite infestation.

Schwegmann and both of his wives are buried in Metairie Cemetery in New Orleans.

Related stories: John F. Schwegmann, Melinda Schwegmann, Parey Branton.

Preceded by Nat B. Knight (D)	Louisiana Public Service Commssioner (District 1) John G. Schwegmann, Jr., (D) 1975–1980	Succeeded by John F. Schwegmann (D)