"I love thinking, throwing ideas off the wall, challenging conventional wisdom..."

Peter Lewis

"Frankly, no one is particularly surprised. He's always made his feelings on the issue known."

Blair Sanford, company analyst

The name Peter B. Lewis meant little to New Zealanders who trawled the internet when news broke that a mystery American billionaire had escaped drugs charges while on holiday here.


But back in the United States, Lewis' name raced through financial and philanthropic circles where he has cultivated a high profile as an eccentric - but highly respected - chairman and chief executive officer of Progressive Corporation, the country's fourth largest personal car insurer.

Lewis, aged 66, has been regarded as a business phenomenon since he inherited his father's company as chief executive officer in 1965 after joining as an underwriting trainee in 1955.

He has led its transformation from 100 employees and $US6 million in revenue to one of the fastest-growing insurers in the United States.

Now more than 14,000 employees generate $6 billion in revenue each year. The company returned $456.7 million in profits in 1998.

It ranks among the top US companies in any industry for long-term growth and total return to shareholders.

Lewis owned about 9 million shares of Progressive's stock at the beginning of last year, worth an estimated $640.2 million, and has a personal fortune estimated by Forbes magazine last year at $1 billion.

Asked about his business philosophy, he told the Cleveland Plain Dealer newspaper: "For me, what's important is creativity. I love thinking, throwing ideas off the wall, challenging conventional wisdom and trying to see into the future."

In 1994, he moved his company into a $75 million showcase headquarters in Mayfield Village, Ohio. It contains a travel agency, health club and more than 4000 pieces of contemporary art - about which Lewis is passionate - designed to create a more stimulating work environment for employees.


Lewis' former wife, Toby Devan Lewis, is the curator of the art collection. The pair are the parents of three grown children - two sons and a daughter - and remain good friends.

Lewis is also known as an extraordinarily generous philanthropist. He has donated $50 million to the visual arts institution the Solomon R. Guggenheim Museum in New York, the largest pledge in its history.

In June last year he gave $55 million to Princeton University in honour of his graduating class of 1955.

Two years ago, he gave $28.8 million towards the construction of a new management school at Case Western Reserve University, where several of the Lewis family studied.

He contributed $260,000 to the Democratic Party in 1996, and once gave $2.5 million to a fitness centre for seniors on the condition they give him a life membership and never again asked him for money.

He is a trustee of Princeton University, chairman of the board of directors at the Guggenheim Museum, and serves on the board of the Cleveland Museum of Art.

So colleagues were understandably stunned that Lewis, known for his excellent judgment, had spent a night under arrest in a police cell as soon as he set foot in New Zealand.

Few, however, were surprised it was because of drugs.

After all, the outspoken Lewis had long made known his support for relaxing his country's strict marijuana laws. In 1998, he was one of three financial backers of an estimated $5 million advertising campaign urging voters in five states to legalise the drug for medicinal use.

The trio, made up of Lewis, New York financier George Soros and University of Phoenix founder John Sperling, have contributed millions of dollars over several years to persuade voters to support propositions making it legal for physicians to recommend marijuana, for primary caregivers to provide it, and for patients to use it.

But critics said the measures were so broad they would allow virtually anyone to obtain and use marijuana.

Lewis stressed to Forbes magazine that he had "made no specific efforts to legalise marijuana," but he would like to soften the "ridiculously incarcerating" drug laws now in effect.

Following Lewis' arrest in January, company analyst Blair Sanford told Reuters: "Frankly, no one is particularly surprised. He's always made his feelings on the issue known."

He has also been rumoured to be a heavy user of the drug for years, with one close acquaintance describing him to Fortune magazine as a "functioning pothead." Lewis has maintained a steadfast "absolutely no comment" approach to the situation via his public relations team since the story broke.

Spokeswoman Leslie Kolleda said Lewis did not even plan to discuss the episode with his company.

The secrecy is at odds with Lewis' policy of honesty and openness - Progressive's list of core values includes the importance of disclosing bad news.

But what many still find puzzling is why one of the United States' wealthiest businessmen risked so much - particularly international travel - just to have some cannabis on him when he boarded his boat Lone Ranger, a converted ice-breaker tug complete with a crew of 16, in Auckland. As Lewis walked through Auckland Airport Customs after stepping off Qantas flight QF26 from Los Angeles at 5.50 am on Wednesday, January 5, drug dogs singled him out.

Customs officials immediately found about 10g of cannabis and two pipes in his briefcase. A further search of his luggage uncovered another 23.3g of cannabis in two screw-top containers.

From there, customs officers boarded Lone Ranger and found a stash of cannabis resin and plant in a safe concealed in the floor of Lewis' ensuite bathroom. He said he had stored the drugs while holidaying on the yacht in Australia last October.

At 2 pm that day, during a videoed interview with police, Lewis admitted the charges and said in explanation that he brought the cannabis into New Zealand for his own use while here on holiday.

Interestingly, he also made it clear to police that he did not want a lawyer and expected to plead guilty in court at the earliest opportunity. It was not until 3.45 pm that Auckland barrister Marie Dyhrberg phoned police, apparently at the request of somebody travelling with Lewis on his boat, to say she would be representing him and requesting bail for her new client.

Later that evening, police processed Lewis at the Otahuhu Police Station where he stayed overnight in a poky cell at possibly the most rundown police facility in the country.

He slept on a bunk built into the wall under one blanket. Staff offered him a microwaved pie for dinner with coffee or water.

He woke up to a breakfast menu of baked beans and saveloys before walking under escort to the Otahuhu courthouse next door.

There he pleaded guilty to three charges of importing cannabis plant and resin. Two of the charges were dated October 25, 1999, when the Lone Ranger sailed into New Zealand waters from Australia with his drug stash on board.

Judge David Harvey remanded Lewis on bail until his second appearance for sentencing the following morning, Friday. Lewis went to his boat to spend the first free night of his New Zealand holiday.

During later court hearings on the issue of Lewis' name suppression, Marie Dyhrberg revealed that Lewis smoked the drug for pain relief on the advice of his doctor after an amputation.

[He has had numerous operations for circulatory problems. In January 1998 one of his legs was partially amputated.]

Keith Stroup, the executive director of the Washington-based NORML (National Organisation for the Reform of Marijuana Laws), and a friend of Lewis, told the Herald Lewis had been a financial supporter of the organisation for four years.

The two men had traded e-mails about the incident.

Mr Stroup said it was "very possible" Lewis used the drug as pain relief.

"To suggest he is a threat to society is absolutely absurd. He has made many millions of dollars and he's a well-respected philanthropist. It's just idiotic to suggest someone like that is a threat to society."