Once the Marsh Supermarkets chain began to falter a few years ago, its owner, a private-equity firm, began selling off the vast retail empire, piece by piece.
The company sold more than 100 convenience stores. It sold the pharmacies. It closed some of the 115 grocery stores, having previously auctioned off their real estate. Then, in May 2017, the company announced the closure of the remaining 44 stores.
Marsh Supermarkets, founded in 1931, had at last filed for bankruptcy.
"It was a long, slow decline," said Amy Gerken, formerly an assistant office manager at one of the stores.
Sun Capital Partners, the private-equity firm that owned Marsh, "didn't really know how grocery stores work. We'd joke about them being on a yacht without even knowing what a UPC code is. But they didn't treat employees right, and since the bankruptcy, everyone is out for their blood."
The anger arises because although the sell-off allowed Sun Capital and its investors to recover their money and then some, the company entered bankruptcy leaving unpaid more than US$80 million ($119.2m) in debts to workers' severance and pensions.
For Sun Capital, this process of buying companies, seeking profits and leaving pensions unpaid is a familiar one. Over the past 10 years, it has taken five companies into bankruptcy while leaving behind debts of about US$280m owed to employee pensions.
The unpaid pension debts mean that some retirees will get smaller checks. Much of the tab will be picked up by the government's pension insurer, a federal agency facing its own budget shortfalls.
"They did everyone dirty," said Kilby Baker, 70, a retired warehouse worker whose pension check was cut by about 25 per cent after Marsh Supermarkets withdrew from the pension.
"We all gave up wage increases so we could have a better pension. Then they just took it away from us."
Founded by two one-time colleagues at Lehman Brothers, Marc Leder and Rodger R. Krouse, Sun Capital manages billions in private-equity investments, buying and selling companies for profit.
The public face of the firm is Leder, a co-owner of the Philadelphia 76ers basketball team and the New Jersey Devils hockey team. Noted for his extravagant parties and yachting expeditions, he has been dubbed by tabloids as "the Hugh Hefner of the Hamptons."
Politically, he may be best known for hosting the Boca Raton, Florida, dinner where presidential candidate Mitt Romney made what became infamous comments about the "47 per cent of the people . . . who are dependent upon government, who believe that they are victims."
In a statement for this story, Sun Capital said: "Marsh was a struggling business that we worked hard to save. Our investment kept the company alive and provided jobs for its employees for 11 years."
Over that period, the company invested US$150m in improving some stores and building others, Sun said, and contributed US$30m to pensions for Marsh workers.
"Despite these efforts, and in the face of declining revenues and massive spending by national competitors, Marsh was unfortunately forced to declare bankruptcy and we lost money on our investment," the statement said.
Regarding the unpaid pensions at the other companies, Leder said in a statement: "You can't reach a meaningful conclusion by examining such a small percentage of our investments. We've done 365 deals in our history and the vast majority have grown and been successful."
When a company fails, it is sometimes impossible to pay everyone who is owed money. The trouble, according to some critics, is that financial firms often extract money from losing bets to reward themselves and then through bankruptcy leave obligations to workers unpaid.
Companies owned by private-equity firms have used bankruptcy to leave behind hundreds of millions in pension debts, according to a government estimate.
"These private-equity firms buy a company, plunder it of any assets, and then send it into bankruptcy without paying employees," said Eileen Appelbaum, an economist at the Center for Economic and Policy Research who studies private-equity transactions.
"To anyone but a bankruptcy court, this looks like a swindle."
In recent years, some in Congress have sought to change the bankruptcy laws to prevent companies from ditching pension debts through bankruptcy.
Last year, Rep. Tim Ryan, D-Ohio, introduced a bill that would give pensions higher priority in bankruptcy payouts. He said that in 2016 alone, 146,000 pensioners overall had seen cuts to their benefits. It did not win passage.
"There's this idea that pensions are a giveaway," said Ryan, who expects to reintroduce the legislation in 2019. But "it's their money. Through negotiations, workers have deferred wages for a pension down the line. For them not to get that money is theft - in a lot of ways. The workers are a pawn in the game."
Since the 1960s, the United States has grappled with how to prevent companies from reneging on the payment of employee pensions.
"You should keep the promises you make to your workers," President George W. Bush said in signing the last major US effort in pension reform, the Pension Protection Act, in 2006.
"If you offer a private pension plan to your employees, you have a duty to set aside enough money now so your workers will get what they've been promised when they retire."
But the threats to pensions continue. At the heart of federal efforts to protect workers is a low-profile government agency known as the Pension Benefit Guaranty Corp., or the PBGC. The agency collects insurance premiums from companies that offer pensions.
When a pension fund runs out of money, the federal agency provides a portion of the lost benefit payments to the affected retirees. In all, it covers the benefits for about 44 million people.
The program has come under mounting financial pressure as more companies have shed their pension debts through bankruptcy.
For example, the part of the government's pension insurer that backs up benefits for many unionised workers is projected to run out of money by 2025, leaving it unable to protect pensioners, many of whom are facing a wave of trouble: The private-sector pension funds covering more than 1 million unionised workers are expected to run out of money within the next 20 years, according to government estimates.
In the view of Joshua Gotbaum, the former director of the PBGC and a former partner in a private-equity firm, much of the blame lies with the financial firms that buy and sell companies for profit.
"What we've seen is that financial firms essentially take the money and run, leaving their employees and the PBGC holding the bag," said Gotbaum, who was appointed to head the agency by President Barack Obama in 2010.
According to a 2013 tally by Gotbaum, companies controlled by private-equity firms have used bankruptcy to shed more than US$650m of pension obligations. That leaves the government's pension insurer or employees to pick up the tab.
Since bankruptcy law changed in 1978, Gotbaum said, "the business community has been inventing new uses of the bankruptcy courts. The private-equity community realised they could use Chapter 11 to do pension laundering."
As a public relations matter, companies that default on their pension obligations often blame business conditions. Executives say the companies simply lack the money to replenish the pension fund.
But it is often the case that companies neglect the pension even when they have the money: The owners would rather use the cash for other purposes, including taking it as dividends for themselves.
Consider four Sun Capital companies - besides Marsh - that were sent into bankruptcy court.
At two of them, Sun Capital took millions of dollars out of the companies while leaving pensions underfunded.
At Powermate, a manufacturer of electric generators with a factory in Nebraska, Sun Capital took US$20m from the company as a dividend in 2006, according to court documents. Two years later, it sent the company into bankruptcy court, leaving the government insurer to pay for the underfunded pension covering 600 workers.
At Indalex, an Illinois-based aluminum parts maker, Sun extracted a dividend of US$70m in 2007, according to court documents. Two years later it sent the company into bankruptcy, leaving the government insurer to pay more than 3,000 pensioners.
At the other two companies, Friendly's Ice Cream in 2011 and Fluid Routing Solutions in 2009, Sun Capital used the bankruptcy court to shed the pension obligations - and then kept operating. First, Sun put each company into bankruptcy, essentially relinquishing control.
In bankruptcy court, the companies were absolved of their pension debts of US$115m and US$30m, respectively. Then, once the companies were pension-free, Sun Capital bought the same companies out of the ensuing bankruptcy auction.
"They used bankruptcy to get rid of pension obligations they didn't want - all while retaining ownership," Gotbaum said.
In response to questions about whether Sun had treated the pensions fairly, the private-equity firm noted that the pension debts at those companies had accrued before Sun became involved: Each of those five companies - Marsh, Powermate, Indalex, Friendly's and Fluid Routing Solutions - had "significant" pension debts when it acquired them.
Indeed, when Sun bought those companies, they were about US$90m behind on pension payments.
By the time those Sun companies filed for bankruptcy and the government insurer picked up their pension obligations, however, their pension debts were estimated at US$280m.
In part, the pension bills went up because the recession caused pension fund losses. Most of that US$280m debt, however, was shed through the bankruptcy courts.
Sun also noted that these five companies represent only a small sample of its investment portfolio. During the period when these five companies filed for bankruptcy with underfunded pensions, Sun had investments in more than 80 companies.
The inspiration for Sun Capital, according to Leder, arose from a visit to Romney's private-equity firm, Bain Capital.
In April 1995, Leder and Krouse, then both at Lehman Brothers, had a meeting at Bain Capital in Boston and heard executives complaining about an investment in which they'd doubled their money.
''We're looking at each other saying, 'This is an industry where double your money is not that good of a deal?' " Leder recalled in an interview with the New York Times.
The two founded Sun Capital the same year. They began raising money from investors, then buying and selling companies for profit.
It was in 2006 that Sun Capital would make a play for Marsh Supermarkets. The chain had been launched by Ermal Marsh in the early years of the Great Depression and since then had expanded rapidly, operating under various names across Indiana, Illinois and Ohio: 69 Marsh supermarkets, 38 LoBill Foods stores, eight O'Malia Food Markets and 154 Village Pantry convenience stores. It also had a catering service, pharmacies and a florist business.
But Marsh was also facing fierce competition, particularly from Walmart, and it had begun racking up debt, losing money and suffering from corporate bloat. Don Marsh, Ermal's son, had taken over the company and, among other extravagances noted by his detractors, he traveled using a corporate jet, a 1997 Citation Ultra.
Yet Sun Capital executives were attracted.
In their view, the supermarket chain was underperforming. It was basically a good business - and if they revamped the company, they thought, there was money to be made, according to former executives who spoke on the condition of anonymity.
Moreover, if they failed at resurrecting the company, they could still turn a profit, former executives said.
The land and buildings owned by Marsh were appraised at about US$360m, according to company financial statements. That meant even if a buyer failed to revive the business, it could make money selling off the stores.
Sun Capital acquired Marsh Supermarkets for US$325m, paying US$88m for the business and assuming US$237m in the company's debt.
"We see tremendous potential in this 75-year franchise and intend to build upon Marsh's significant market share in the communities in which it serves," a Sun Capital executive said in a news release at the time.
By most accounts, Sun's reign at Marsh Supermarkets got off to a good start. Under Sun's management, corporate overhead was trimmed. The staff at headquarters, which had about 500 people, was pared about 30 per cent. Sun executives dropped the company's pricey corporate sponsorship for the Indiana Pacers NBA team. The company's jet had been scrapped.
The cost savings, in turn, provided cash to help remodel older stores.
"We were rocking and rolling again," said a former Marsh executive who spoke on the condition of anonymity. "We saw a sales bump with the store renovations."
The profits didn't last. Former Marsh executives cited a variety of reasons for Marsh's subsequent demise: the recession, which continued to depress consumer spending; executive turnover at Marsh; and finally, competition from other larger chains, particularly Kroger and Meijer, which cut into margins.
Marsh Supermarkets was on a long slow road to bankruptcy, but Sun Capital and its investors nonetheless would manage to recover their investment, mainly by selling the company off in pieces.
One of the first moves they made at Marsh was a "sale-leaseback," and it was critical. Marsh sold off its real estate portfolio for about US$260m, according to Marsh documents, and then leased the stores back from the new owners.
There were more sales to come. In 2013, Marsh sold some of its convenience stores for US$48m, according to a lawsuit filed by the buyer.
And in 2015, Marsh collected an additional US$40m with the sale of the rest of the convenience stores, according to the same lawsuit. Some of the money from these sales stayed with Marsh; some went back to Sun Capital.
When considering whether anyone made money with the Marsh investment, there are two parties to consider.
First are the investors who turned over money to Sun Capital to invest in buying and selling companies such as Marsh Supermarkets. These investors got back almost all of the money they sank into Marsh, according to a cash-flow statement obtained by The Washington Post. They recovered all but US$500,000 of the US$51m invested in buying and renovating the chain. When Sun Capital says the investment lost money, this is what they are referring to.
But then there is Sun Capital Partners itself. It did better than merely recover its investment. As an investor in its own fund, it may have shared a small portion of the US$500,000 loss.
But private-equity firms also collect fees on the portfolio companies they manage, and these would have more than made up for that slight loss. Sun Capital collected a US$1m annual management fee from Marsh, according to former executives.
Sun Capital also has collected large commissions for selling off assets, as it did with Marsh, but it is not known how much Sun Capital took in such commissions in this case. Sun Capital declined to share the fees in the Marsh deal.
Even with the eventual bankruptcy, "there's no way Sun lost money on that deal," said Douglas W. Dougherty, chief financial officer at Marsh Supermarkets until a few months after Sun Capital acquired the company. "The value of the real estate in the company, which they sold, was just too much."
Alhough Sun Capital investors were basically repaid, the Marsh pension debts were not. The company was notified in May 2012 - just a few days after the Romney dinner - that it owed US$62m to the pension for warehouse workers.
At the same time, it was behind millions of dollars to the pension covering store employees. Those debts remained largely unpaid at the time of bankruptcy.
"Sun thus stripped [Marsh Supermarkets and its affiliates] of more than US$100m that should have been used to resolve the pension obligation," alleges a lawsuit filed by GPM Investments, the company that bought the convenience stores and is disputing whether it is liable for any of the pension debt.
Through its attorneys, GPM Investments declined to comment.
When Sun bought Marsh Supermarkets, the company had three retirement plans. One for the top five Marsh executives, one for the store employees, and one for the warehouse workers.
Only the executives' plan, however, was fully funded under the sales agreement: With the completion of Sun's purchase, Marsh's top five executives were to be awarded US$14m in retirement payments, according to company financial documents. Among them: CEO Don Marsh for US$7m and corporate counsel P. Lawrence Butt for US$2.2m.
Meanwhile, the other two retirement plans - the worker pensions - were short millions of dollars.
The pension for store employees - deli clerks, cashiers, store managers - was underfunded by US$32m at the time of the bankruptcy. Most of that burden will be placed on the government insurer, the Pension Benefit Guaranty Corp., which will restore virtually all of what the 4,000 store employees entitled to pensions were owed in retirement.
The pension covering the company's warehouse workers fared worst.
At the time of the bankruptcy, Marsh Supermarkets was behind in its obligations to that pension by US$55m, and because of the way that pension is organised, the shortfall is likely to help cause significant cuts to pension checks for retirees and accelerate financial woes of the government's pension insurer.
The pension fund for Marsh's warehouse workers is part of a Teamsters-affiliated fund known as Central States, which covers about 400,000 people. Even before the Marsh bankruptcy, Central States was running out of money, partly because so many trucking companies have filed for bankruptcy.
More than US$1.5 billion of the Central States pension shortfall can be traced to bankruptcy by companies owned by private-equity firms, according to the pension fund. It is expected to be insolvent within seven years.
Barring a government intervention, pensioners who worked at Marsh's warehouses, making about US$17 an hour, may get very little of the pensions they were expecting.
For years, the warehouse workers had given up wage increases in order to get a better pension, they said.
Yet some retirees already have seen cuts to the amounts they had been promised. The highest pension checks run about US$2,600 a month, cut from more than US$3,000, according to retirees. When Sun pulled Marsh Supermarkets out of the Central States pension plan in 2012, pension benefits dropped about 25 per cent, pension officials said.
But the projected insolvency of the Central States pension would be far worse - stranding not only the Marsh warehouse workers but thousands of other pensioners who rely on it.
"They're jacking with people's lives," said Darren Cooper, 48, who worked at the warehouse for 26 years until the bankruptcy.
"When Sun took over, we were kind of all taken aback. You didn't mind working for a place that started up right around here. But then all of a sudden with Sun, we're working for some rich guy from somewhere else who doesn't care about you. They don't even know who you are - they're just counting their money."
Among those who have seen their benefit drop is Phil Rainey, 70, who worked in the Marsh warehouse for decades. He began at Marsh's ice cream factory in 1967, a year after graduating from high school. His mother had worked at the Marsh bakery. He was drafted a couple years later and, after an Army tour in Vietnam, Rainey worked the next 42 years at the Marsh warehouse. Over that time, he got married, bought a house, and raised two daughters.
Like others in his union, Rainey was willing to give up wage increases to get a better pension, and as he thought about retirement, he figured his finances would hold, thanks to the monthly benefit.
And just to get his "ducks in a row," he also arranged to pay off his home mortgage. Like many planning retirement, he didn't want to have to worry.
Already, though, his monthly benefit payment has been cut about 25 percent, and the promised certainty of a stable monthly pension check has been elusive.
"I've been fighting since I retired to keep the pension," Rainey said. "And I think about it a lot. We don't know what's going to happen."
He's gotten notices saying that the Central States pension is projected to run out of money in 2025. And that the government insurance program that normally would have insured those pension benefits is expected to go bust about the same time.
"Seems kind of funny that those two would run out of money at the same time," Rainey said skeptically.
"But then, it's not funny at all. If I lose my pension, what am I going to do? Who's going to hire a 75-year-old man?"