The Family Jewels

In life, Paul Kalmanovitz controlled every business decision related to his $500million brewery/real estate dynasty.He even made detailed plans forthe governance of his estateafter he died. So why is the Kalmanovitz fortune the center of two vituperative

But it's the suggestion that campaign contributions played a role in determining his actions that upsets the deputy so much. "That is such an extraordinary charge and has no basis in fact," he says. "Mr. Lungren has never discussed this case with me. He doesn't know this case from a bar of soap."

Bernard Orsi is easy to characterize as a villain. He's handsome and rugged with a deep, booming voice. In court, he was always dressed impeccably. He has a rich man's flawless tan.

"Look, I don't mean to be rude," he says, touching my elbow in that reassuring way. "I'm sure you're a great guy. It's just every time I open my mouth to a reporter I pick up the paper and go, 'Whoa!' " He slaps his forehead in the same way my relatives in Italy do.

If one believes the Kalmanovitz relatives, disgruntled former S&P employees, and the Schreyacks, Orsi is the devil incarnate.

"He's Siciliiiiian," says Betsie Diamond, Mr. Paul's former legal secretary, in a phone interview. (Orsi fired her shortly after Mr. Paul's death.)

Diamond tells a story about the morning after Mr. Paul's death. She walked into the office on St. Thomas Way and Orsi, Issleib, and other S&P officers were drinking Jack Daniel's, toasting the death of their difficult patron. "They asked me to join them," she says in a phone interview. " 'Ding dong the king is dead,' Orsi said."

Orsi is best known as one of Joe Alioto's right-hand men during Alioto's mayoralty. He served as chief of staff, general manager of personnel, and later as port director. "He ran the town," says Marcia Smolens, one of the city's most prominent lobbyists.

After leaving government, Orsi went to work for Pacific Far East Lines, Alioto's shipping business. The company soon hit bankruptcy and Orsi went to work for Mr. Paul in 1978 after Alioto recommended him.

Bitting is also easy for the Kalmanovitz relatives to demonize. "He worked for Howard Hughes," Stanley Kalmanovitz says one day. "And you know what happened to him." But for some reason, Issleib and to a lesser degree Bitting have been let off the hook by the relatives. Sharon Hegseth even testified that Issleib wished them luck on their suit. "He said, 'I hope you get what you want,' " she said. " 'You deserve it.' "

But Orsi is the locus of the relatives' hatred. And it's taken a toll on his life, Michael Schwarz says. "A friend of his who he has known for a long time talked to Sharon [Hegseth] and she told this friend a whole bunch of stuff," Schwarz says in a phone interview. "The friend told Bernie, 'If half of what she says is true you are going to jail.' The two have not talked since. Bernie is so wounded."

Orsi is accused by the plaintiffs and others of manipulating the last will of Mr. Paul and later codicils of Lydia's reciprocal will agreement after the old man died. Impossible to prove, there still are tantalizing facts that could lead one to consider the relatives' argument.

Consider: On Nov. 13, 1986, two months and four days before Mr. Paul died, his will was succinct. All of his assets would transfer to his wife when he died, and after she died they would fold into the 102 Foundation, a charitable trust named after the first successful beer Mr. Paul bottled, Brew 102.

The foundation would be ruled by a board of trustees. The will named Orsi and Issleib to the board along with seven other members: City of Hope National Medical Center; International Guiding Eyes Inc., a Seeing Eye dog group; Creighton University in Omaha, Neb.; Children's Orthopedic Hospital in Seattle; Children's Hospital in San Antonio; Southwest Foundation for Research and Education in San Antonio; and Marin General Hospital.

The will had a specific list of beneficiaries, including Guide Dogs for the Blind and Ralph M. Davies Medical Center.

On Nov. 14, 1986, Mr. Paul changed his will dramatically. The seven-member board was scrapped and replaced by a three-member board: Orsi and Issleib remained and they were joined for the first time by Bitting. The specific list of beneficiaries was also jettisoned and the Kalmanovitz Charitable Trust was set up and directed, generally, to give money to hospitals and institutions of education.

As trustees of the estate, Orsi and Issleib voted Bitting onto the board of directors of the S&P Co. (According to Apallas and Schwarz, the S&P Co. and the charitable trust are essentially the same thing. All assets left over after salaries, stock dividends, and operating costs go into the trust. The trustees vote the stock -- setting salaries, costs, and dividends, and decide how to parcel out the charitable donations.)

I ask Schwarz why the will was changed, but he cannot answer. He says he'll try and get one of the trustees, or the lead attorney on the case, Ron Malone, to call me. Neither happens.

Ultimately, no one will ever know how in charge Mr. Paul was at the time he changed his will. He may well have been in total control of what was going on, as some say. Others say he was drugged up on painkillers. The sad fact is that the truth will probably never come out. There is no objective third party to testify to Mr. Paul's state of mind. Everyone has an agenda. All are equally suspect.

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