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Son Replaces Father as Head of Haft Firm : Feuding: Move is evidence of new factions among family controlling Dart Group.

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From the Washington Post

Herbert Haft was unexpectedly deposed by his younger son Ronald this weekend as chairman of a real estate company he founded decades ago.

A onetime ally with his father against his elder brother Robert, Ronald Haft replaced his father Saturday, the company said.

On Friday, Ronald’s lawyers announced that they expected his father to try to replace him as president of the Crown Books chain at a board meeting Wednesday.

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The moves are evidence that the Haft family is breaking up into more factions over control of an empire that includes retailing conglomerate Dart Group Corp.

Just four months ago, Herbert and Ronald were on the same side in settling an ugly family battle over Dart with Herbert’s former wife Gloria, daughter Linda and elder son Robert.

Robert Haft had been a key part of the management, having started both Trak Auto and Crown Books, both Dart subsidiaries. The settlement, reached in May, was not disclosed but essentially Herbert and Ronald bought a large part of the rest of the family’s assets. The total assets of the companies are estimated at well over $1 billion. But Gloria, Robert and Linda Haft retained large blocks of voting stock in the companies.

The real estate part of the empire, Combined Properties, issued a statement Saturday announcing the removal of Herbert Haft. Herbert Haft and Ronald Haft declined to comment. Herbert Haft’s lawyers said they would move to overturn the actions in District of Columbia Superior Court.

Combined Properties is one of the Washington area’s largest real estate management companies. A private company, it manages more than 40 prime shopping centers and other real estate. The properties are largely owned by Herbert and Ronald Haft and are worth hundreds of millions of dollars.

The Haft family controls the publicly traded Dart Group Corp., which owns large stakes in retailers Crown Books, Trak Auto Corp. and Shoppers Food Warehouse Corp.

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Combined Properties said Herbert Haft’s stake in the company was reduced to 45% from 66%.

Under the new plan, Ronald Haft, 34, will hold 33% of the company’s shares. He also continues as chief executive.

“There was a board meeting of Combined Properties and Herbert Haft was removed as chairman of the board,” said Robert Greenberg of Keck, Mahin & Cate, Combined Properties’s newly appointed independent counsel.

According to Ronald Haft’s attorneys, Herbert Haft plans to propose at next Wednesday’s board meeting of Crown Books that Ronald Marshall be named the new president of Crown Books. They also said he may try to fire Ronald Haft from his job as president of Dart.

Dart Group also will have a board meeting next Wednesday.

Herbert Haft controls 57% of the voting rights of Dart Group, but a majority of Dart’s board is made up of independent directors.

Marshall currently is Dart’s chief financial officer. According to the lawyers, Marshall authorized an $18-million loan from Dart Group to Herbert Haft that was later rescinded.

Lawyers from the firm Wilmer, Cutler & Pickering, who are representing Dart Group, said at a hearing Friday that they are unaware of an agenda item at the Dart board meeting concerning Ronald Haft.

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They didn’t deny, however, that Herbert is seeking to install Marshall as president of Crown Books.

Herbert and Gloria Haft, who built the family fortune together from a single drugstore in the Adams-Morgan neighborhood in northwest Washington, D.C., agreed to an uncontested divorce at the same time as the financial settlement in May.

The divorce proceedings began in court, where Herbert accused Gloria of forming an “unholy alliance” with his son Robert. Gloria alleged that Herbert was verbally abusive, played around with other women and spent $1.5 million to pay off a mistress.

The Times and Bloomberg Financial News also contributed to this report.

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