The Iron Fist: The Immigrant Journey of J. B. Leonis to Riches and Power in Southern California

By Richard Nordin

In 1889, a teenage seminary student in the Basque Country of France receives a letter from his powerful uncle in California to come join him and quickly agrees. His uncle, a man referred to as The King of Calabasas for his control of thousands of acres, needs an heir. Unfortunately for the young Jean Baptiste Leonis, his uncle is killed shortly after his nephews arrival. The young man was left without any benefit of his uncles estate and must start again in a land of strangers. Fifteen years later, the young man, now known as J. B., starts a unique cityfirst focused on booze and sports then on building factories and jobs, but like so many, he was never interested in the family homes and neighborhoods of other developers. His rise to power in twentieth-century California and the riches that came with his hard work and vision were met with praise, attacks, and family scandal. He remained stubbornly true to his vision till his last breath.

• Language: English
• Publisher: Xlibris US
• Release date: Jan 6, 2017
• ISBN: 9781524570460

Richard Nordin

Richard M. Nordin is a Midwesterner by birth and an Angeleno by choice. As historian for the Los Angeles Area Chamber of Commerce, the oldest and largest civic organization in Los Angeles, he played a critical role in their 125th anniversary in 2013. He has served as a speaker and on the luncheon committee of the Los Angeles First Century Families—a group whose relatives arrived in LA before 1881. He also has had a successful forty-year career in fundraising at local and national institutions including USC, UCLA, and Cal Poly Pomona. He is a graduate of the University of Southern California.

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Copyright © 2017 by Richard Nordin.

Library of Congress Control Number:   2016920940

ISBN:      Hardcover   978-1-5245-7044-6

                 Softcover    978-1-5245-7045-3

                 eBook          978-1-5245-7046-0

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright owner.

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Rev. date: 01/30/2017

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Contents

Preface

Chapter 1 An Introduction to JB’s Town

Chapter 2 The King of Calabasas

Chapter 3 To Be a True Basque Is to Have an Uncle in California

Chapter 4 Orain Zer (Basque for Now What?)

Chapter 5 New Beginnings

Chapter 6 The First Days of Vernon

Chapter 7 Change and New Initiatives

Chapter 8 Three Solid Votes and Attempted Murder

Chapter 9 Vice in Vernon

Chapter 10 Drunks and Other Things Made in Vernon

Chapter 11 The Coming of Prohibition and Roaring Twenties Prosperity

Chapter 12 Railroads, Expansion, and Betrayal

Chapter 13 From Cattle to Beef

Chapter 14 Family Matters

Chapter 15 The Beginning of the Great Depression

Chapter 16 Move the Bodies

Chapter 17 Fear

Chapter 18 Departures and Losses

Chapter 19 Wars

Chapter 20 Transitions

Chapter 21 Changing of the Guard: Vernon Style

Chapter 22 Last Acts

Chapter 23 Final Weeks

Epilogue: The Heir

Acknowledgments

Bibliography

In memory of D. Leonie Malburg,

a life force equal to any and the proud Basque granddaughter-in-law of J. B. Leonis

Preface

Home to more plants and factories than people, California’s City of Vernon made it to its 111th birthday in September 2016, but just barely.

The globalizing decades following the death of key founder J. B. Leonis in 1953 subjected California’s first factory town—the exclusively industrial city and sovereign domain he created in 1905—to forces not even the iron fist of Leonis could have bent to his will. Economic and cultural forces were changing the rules of the game. The intrusion of the outside government, so safely kept at arm’s length for so long by JB, was now threatening the very independence the Basque-born Leonis and his Irish cofounders had sought and maintained. The ranks of family, friends, supporters, and contemporaries kept thinning through the decades until they had all but disappeared by the dawn of the twenty-first century. Worse, the original raft of companies that had bought into and long profited off Leonis’s innovative vision of a city completely at the service of its factories—its true residents—had moved on to other newer locales, be they domestic or international.

When most people die, legacies perish quickly and barely survive more than one generation. And while philanthropic foundations or charitable gifts often figure into those that last longer, those were not JB’s focus. He was all about business and bringing business to California, especially Southern California. Though Leonis made his fortune in real estate and banking, his heart and soul really belonged to the unique city he built. Born from the struggles of a lost opportunity, his quixotic vision became fin-de-siècle reality and enduring twentieth-century legacy, thanks to a rare ability to understand and outsmart any contemporary force, friend or foe, that stood in his and Vernon’s way. California’s first factory town remained the single-pointed focus of his life till his last breath. While his uncle Miguel had promised him a legacy but died before fulfilling that promise, it was JB who created his own fortune and built a legacy for his only grandchild. While JB got nothing from his rich uncle, he made sure that his grandson wouldn’t suffer the same fate. Leonis Malburg inherited his grandfather’s independence and stubborn will, but with a softer and even philanthropic touch. The Vernon of today can’t be understood without a close observation of the key events that transpired before and after its founding, can’t even be understood without understanding the fifty years and the family and iron-fisted man who birthed it. The founder’s imprint is still amazingly strong after all these years.

By entrusting his most precious of legacies to his only grandchild, Leonis C. Malburg, JB, wittingly or not, was doing what he could to transcend a typical American story of immigration, adventure, and inheritance. Having first chosen to join his uncle’s new life in the New World over the finality of one as a seminarian hidden away in the Old World; having watched how wealth and identity could be newly and vastly created only to see just how quickly foes masquerading as friends and fateful accidents could take it all away; having then created a fortress of a factory town out of the dumps of a neighboring Goliath so impenetrable in its first fifty years only to be betrayed by a foe masquerading as a son, JB really only had one choice before shuffling off his factory coil: making sure that his grandson lived his life not just as an heir, but as a living memorial to his iron-fisted grandfather.

And by most yardsticks of the last century, his beloved grandson—ably juggling roles as varied as banker; landowner; moving target of the press, competitors, and power-hungry politicians; and perhaps most importantly, as elected official of the City of Vernon—more than delivered upon the stage. Up until this new century forced him to play on a new stage, one shrinking beneath him, falling prey, day by day, to the forces outside its gates.

Chapter 1

An Introduction to JB’s Town

In 1950, three years before J. B. Leonis’s death, the Daily News ran a multipart article titled Vernon: The City where Nobody Lives. JB often chuckled over this label because from the first day in 1905 when he secured a vote for cityhood from the Los Angeles County Board of Supervisors until his last breath, he was intent on creating industries with jobs and not residents with backyards in Vernon. Yet there was a problem with this unwavering focus on providing jobs for residents of neighboring cities. A city needs enough qualified citizens of its own to run for election to the city council. Moreover, for the city to make it to its next major celebration, it must have a viable number of people to actually vote in elections to select people to hold those council seats.

Most founders of cities didn’t go through all the trouble of getting a town up and running only to see its population shrink in the years to come, but Vernon and its iconoclastic founder proved quite the exception. In 1960, the Los Angeles Mirror comically pointed out the unique contrast between Vernon’s sharply declining population and its booming industrialization with a comic-strip cell of a sign maker busily updating the population rolls’ dwindling dance across the decades—from 850 people in 1940, to 432 in 1950, to an anemic 228 in 1960. Foregrounding him is another sign maker proudly facing the paper’s readers with a brush still dripping paint next to a sign proclaiming a number much more robust for the industries of Vernon—an eye-popping 1,000. The explanation that follows about this unusual person-to-business ratio concludes that the community now stands as a model of specialization. It was a model for a company town, but not for a democratic one.

Back in 1905, the minimum population required to file to create a city was 500. By as early as 1950, the people of Vernon found themselves 68 short of what the law had required forty-five years earlier to become a city. Subsequent years showed the use of city-built housing to provide for new residents, but they were mostly city employees. Though the 1970 census rolls did manage to show a 14 percent increase, the population reached as low as 90 residents in 1980 before recovering to 112 in the last US census in 2010.

The Economist spotlighted Vernon as recently as 2008 in the article Where There’s Muck … trumpeting it not only as a place for factories but also one that catered to noisy industry with incentives and services. That same year, the Los Angeles Economic Development Corporation (LAEDC) recognized Vernon as the most business-friendly city in Los Angeles County with a population below fifty thousand—they might as well have said below five hundred. The Economist pointed out that of the 90 people who lived in Vernon, many were cops and firefighters, with most renting their homes from the city for a pittance. As this had resulted in the city’s electorate being drawn from the city employees, the Economist’s analysis turned cutting by the article’s close: It does not sound like a recipe for a functioning democracy, because it isn’t.

Even today, as JB’s and his grandson’s successors encouraged the first private housing constructed in the city in decades (Vernon Village),they still face the problem of building a populace large enough to produce candidates and competitive elections. This is likely to be the ongoing problem for Vernon. How do you grow the population in an industrial town surrounded by much more pleasant suburban residential options? JB, in his first trustee (council) resolution in 1905, talked about supporting housing but always reminding people the town was about industry first, and that hasn’t changed. Perhaps the concept of a merger with another city will gain traction—a merger not with Los Angeles, who has craved Vernon’s rich tax base, but with a city like Huntington Park. Such a proposal was floated in the early 1960s but to no avail then. Will the time be right in the coming decades? Even J. B. Leonis entertained the idea in his first city resolution in 1905. In the ongoing battle between Los Angeles and Vernon, anything is possible.

Democracy in an American city is focused on an elected council. In spite of all the ink used by newspapers on Leonis and his grandson, the Furlongs were the last founding family with a number of people residing in the area. They came to dominate the Vernon City Council in the time after JB’s death but stayed under the radar of local papers in spite of controlling the position of mayor for fifty-eight years. The 1950s and 1960s saw a minimum of two Furlong family members on the city council, and for a time, key administrative positions were held by family members too. Twenty years after the city’s founding, JB had been labeled as the ruler, but the Furlongs were also key players in the game of running the city for many decades.

It wasn’t until three years after JB’s death that his grandson was appointed to the city council when a sitting councilman, Charles Trowbridge, died. He joined Robert Furlong, son of longtime city clerk and cofounder Tom Furlong, on the council with Robert’s aunt Judith Poxon and JB’s former employee Genevieve Anderson. Now, Bob Furlong had previously been a councilman for a short time before his service in World War II took him overseas. He had replaced his uncle James who died in 1941. James J. Furlong’s death signaled the beginning of the end of the founder period—a period brought to a close in 1953 when JB joined him at Calvary Cemetery in East Los Angeles.

So when Bob returned from the war, his placeholder cousin stepped down to make the seat available for him. From 1948 until his death in 1974, he served admirably as mayor. At the time of his death, his mayor pro tem, Leonis C. Malburg, became mayor. Malburg would have Tom Ybarra, who was from another longtime area family, as his mayor pro tem. Tom’s uncle had previously served fifteen years with JB on the council, beginning in 1930 and ending with his death in 1945.

The Ybarra family became the last multigenerational family to serve on the city council when Melissa Ybarra became the fourth generation on the city council in 2015. She was elected to a seat previously held by her father, Michael, who sadly died suddenly while in office. She won twenty-five out of twenty-five votes cast in 2015, which is substantially less than the original sixty-eight votes cast to found the city 110 years ago. Melissa, under new rules put in place after 2010, is only allowed to serve for a lifetime maximum of two five-year terms. She could not be appointed to the vacant position her father held, as historically occurred with members of the Furlong Family and others. Under the new rules, she had to run for the seat in an open election. In another recent reform move, the council cut their own salaries by almost two thirds to $24,946—still a long way from the $50 a month paid to them in 1950, the year JB stepped down. All these reforms will likely mean that it is Leonis Malburg who will go down in city history as the longest-serving council member and mayor.

Now, to be clear, Vernon is unique in many ways, including its ruling families, though political dynasties are not unusual in America. At the national level, we have had families like the Roosevelts, Kennedys, and Bushes; while on the state level, there were father and son governors from the Brown Family. Locally, the Hahn Family has produced a congressman, a Los Angeles mayor, and two county supervisors; but what made Vernon unique was the control exerted by two founding families, from 1905 to 1974, in an increasingly rich industrial town with a shrinking population of voters.

Two of the three votes needed for a quorum or to pass ordinances were always provided by the Leonis family and the Furlongs; and for a time in the late 1950s and ’60s, they had all three votes to enforce their will. Even JB had to make sure there was a third vote from one of the other council members in his years in city government, whether it was from the colorful P. J. Durbin for over twenty years or Melissa Ybarra’s great-uncle for fifteen years. JB’s grandson rarely had to worry about such headcounts, as the council votes tended to be unanimous. The members also relied upon trusted and strong city administrators. Rightly or wrongly, in an era of term limits, the presence of people with forty years on a council is simply viewed as wrong or corrupt, and that has been doubly so when those members are from rich founding families, like Leonis Malburg.

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Vernon is a stark environment from the 1920s—devoid of trees and amenities found in more residential cities, but that is how it was planned—designed to produce products and jobs. (Photo by R. M. Nordin)

JB always loved to tell people who complained and inquired after the mysterious smells emanating from Vernon, Yes, that’s the smell of money. Actually, the smell was a unique cocktail of odors commingling from meat packing plants, foundries, and all manner of rendering, refineries, and chemical plants. These smells contrasted radically with the aromatic fragrance of the orange blossoms wafting from the numerous orange groves that had come to dominate Southern California in the years since the 1880s and that survived into the 1950s.

In recent years, the smells were toxic, and one emanated from a plant like that once owned by Exide Technology. The toxic location had been in Vernon for over ninety years under various owners. Its business was recycling batteries, and it spewed toxic lead into the neighborhood. That area was also polluted with arsenic—factors that increase the risk of cancer to a maximum level for people in the vicinity of the plant. Those smells still meant money for some, but now they also meant death for others.

At its industrial high point, there were 1,200 different plants and businesses representing some 70,000 to 80,000 employees working in Vernon. A roll call of some of the big names included Aluminum Company of America, American Can, Bethlehem Steel, Norris Thermador, Owens-Illinois Glass, Ducommun, and Swift & Company. There was also the Los Angeles Union Stockyards. The years immediately after Leonis Malburg became mayor coincided with the high point in American industrial or manufacturing employment. Vernon would see a drop in its employment figures, with some 20,000 to 30,000 jobs disappearing from company rolls in the decades after 1960. In many cases, that was because firms like Bethlehem Steel and Swift & Company left town, taking with them thousands of good-paying, middle-class jobs. The mid-1970s also marked a point when air pollution control efforts took form with the creation of the South Coast Air Quality Management District (or SCAQMD). Capitalism, which drove companies to look for larger and cheaper locations for their new plants, including international locations and a growing consensus for better environmental health, both hit Vernon hard. Previously, JB had successfully stayed ahead of other cities by getting companies to locate on new factory sites in Vernon because of the business-friendly government. In the years after his death, rising global competition—as other cities began to catch on, mimicking his once one-of-a-kind model—reduced its efficacy and Vernon’s lead considerably.

A 1961 article in the Los Angeles Examiner titled Vernon a city built to serve big industry gave one clue of what was ahead for the city when it presciently pointed out that already there’s a notable flux in Vernon’s industrial picture as some companies, unable to expand on present locations, have sought sites elsewhere. After all, just four years before this tea-leaves-reading article, the founding of the City of Industry in 1957 threw down a gauntlet to JB’s sovereign domain. Over twice Vernon’s size and only a mere nineteen miles east, it was brazenly close to California’s original factory town. Almost 100 percent of its land was targeted for industrial use. Soon after, other copycat towns (like Commerce in 1960) started sprouting up. The City of Industry would end up mirroring Vernon at every conceivable angle, what with its shrinking population and colorful local politics.

One only needs to look at Ducommun—an original Los Angeles family firm and one that had a site in Vernon for years—to understand how departures from the local scene became the norm. The oldest company in California, Ducommun first began as a hardware store near the Los Angeles Plaza in 1847 at which a young JB’s uncle likely bought him a gun there in 1889. It morphed exponentially into a colossal firm serving the aerospace, defense, industrial, natural resources, and medical industries of today. Household names like Lindbergh, Douglas, and Lockheed were among its first aerospace clients. Family members were heavily involved in community groups like the Los Angeles Chamber of Commerce. Their corporate headquarters is not in the City of Los Angeles anymore but is in Carson—so at least they remained in California along with operational sites spread across Southern California, as well as those across the United States and the world. And the site in Vernon was sold long ago. Corporations have loyalty to shareholders and the bottom line—not to cities, be they Los Angeles or Vernon. Cities with more acreage to expand on are better able to steal Vernon’s firms now.

From 2000 to 2015, Southern California’s manufacturing employment continued to drop by about 30 percent, with durable goods manufacturing suffering the lion’s share of the drop. The Vernon focus on exclusively industrial and the wisdom of that key founding principle of the city is still born out in industrial vacancy rates in Los Angeles County. In 2015, they were reported at only 2 percent—the lowest since 2008. Land for industry and all its noises and smells is limited, and that still favors a place like Vernon, where businesses mean jobs and solid land values. JB’s vision of a need for industrial land without residences nearby is still as vital as it was in 1905, except for the need to maintain a functioning democracy without toxic pollutants.

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The Leonis Adobe, home of JB’s uncle Miguel just prior to a demolition threat. Insert is the adobe after its dedication as Los Angeles Historic Cultural Monument No. 1 (University of Southern California. Libraries and California Historical Society, and Collection of L. C. Malburg)

In November 1961, Leonis Malburg received a letter from Marie Stewart, president of the Encino Historical Society. Her concern was the future of his great-uncle Miguel’s adobe in Calabasas. She reported that it was in escrow and that she had asked the new owner what will be done, and he said, The bulldozers will push it down. She went on to ask him to encourage the new owner to not forfeit our heritage for so-called progress.

Malburg remembered a few rare trips to the adobe with his grandfather and grandmother, but the old place didn’t have a strong emotional linkage to the family. His grandfather had only lived there for about six weeks in 1889, and the property had gone to Miguel’s wife, Espiritu, in the estate settlement. Vernon had been the focus of the family interests in real estate since 1898. It was a place not unlike his uncle’s Rancho El Escorpion that was tightly controlled in the way of the Basques—living a semiautonomous life within another realm.

By August of 1962, those bulldozers were almost a reality, until the City of Los Angeles Cultural Heritage Board declared the adobe Historic Cultural Monument No. 1 and invoked a 360-day stay on any demolition work. A staff member in the city had also used a technicality to delay the demolition until the stay was effective. The real heroine in this case was not a family member but was valley resident Kathleen Beachy, who worked to save the adobe and eventually bought the property for the nonprofit organization that now runs it. Leonis Malburg would become involved in the early years of the nonprofit as a board member.

It was another outsider who rose to the defense of Miguel’s nephew’s town of Vernon in the twenty-first century. A new scandal surrounding JB’s grandson, Leonis Malburg, and city administrator Bruce Malkenhorst had moved the Speaker of the Assembly, John Perez, to submit a bill to disincorporate any city with less than a population of 150. Vernon was the only one in the