Former Alaska Airlines leader Cosgrave parlayed Fairbanks real estate into airline coup

Ron Cosgrave, a Marine who had served in Korea, started the North Alaska Development Corp. with seven UA students in 1957.

Working under guidance from former University of Alaska President Charles Bunnell, they later  acquired land from his estate, subdivided property and built facilities like the Nanook Motel and the Tanana Trailer Village. Their company was providing low-cost housing for about 300 Fairbanks students by the mid-1960s.

Cosgrave, the first UA graduate in chemical engineering, and those who joined what was at first a hand-to-mouth venture, including Bruce Kennedy, who accepted company stock in lieu of wages, learned the skills they needed for one of the most important corporate revolts in Alaska history.

Shortly after the boom that followed the Prudhoe Bay oil discovery,  an unusual stock and real estate transaction between the land company and Alaska Airlines proved a turning point in the lives of both men and launched them on careers in aviation.

Cosgrave, the guiding hand at Alaska Airlines for most of the 1970s, died May 14 in Seattle at 84.

Kennedy, the top man at Alaska Airlines from 1979 to 1991, died in 2007 when his Cessna 182 hit a tree as he approached the airport in Cashmere, Washington.

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It was an attempt to protect his real estate holdings that led Cosgrave to the top of Alaska Airlines in 1972, when he engineered a dramatic corporate coup that probably saved the company from financial ruin.

For 15 years before that, a decorated World War II Navy veteran named Charles Willis Jr. ran the company in ways that made bankers shudder. He was innovative and flamboyant but always stayed close to the edge.

Willis, known to some as "Whiskey Willis," was credited with coining "I Like Ike" as a slogan for Dwight D. Eisenhower's presidential campaign.

It was Willis who placed Cosgrave on the board of the airline as executive vice president, but after a 1972  transaction that made Cosgrave's company the largest airline shareholder with 23 percent of its stock, the relationship changed.

"Ron Cosgrave was the most intelligent man you could ever meet," Bob Gray, the airline labor relations man, told author Robert Serling. "If you didn't think so, you were making a mistake."

Willis made that mistake, Serling said.

As the airline's debts mounted — at one point Chevron said it would refuse to provide any more fuel on credit,many on the board of directors concluded that Willis had to go.

It was Cosgrave, 39 at the time, who arranged the board meeting on May 12, 1972 at which Willis was dumped. Nine of the 12 board members present voted to replace Willis, who was 53, with Cosgrave. But Willis fought back.

"First Willis yelled that he was firing everybody," Serling wrote in his history of Alaska Airlines, "Character & Characters: The Spirit of Alaska Airlines."

Then, as Serling put it, "all hell broke loose."

Willis went back to his office and found that someone had placed a bug in it.  Soon, Willis and attorney Henry Camarot were exchanging punches.

"After I got them separated, I was the one who called the Seattle cops, something Charlie got blamed for later," said airline executive Dennis Kelley.

The fisticuffs had ended by the time that the Seattle police and airport police arrived, but Willis ordered that a message be sent out to the entire Alaska Airlines system saying there had been an attempted coup but that he was still in charge. He said he had fired those responsible.

Cosgrave issued orders contradicting those from Willis and it wasn't until a second board meeting the next day that the confusion ended with another clear vote: Willis was out.

While Willis continued to challenge the action in the years ahead in the courts, Cosgrave began to learn how to run an airline and Kennedy filled a place on the board vacated by the previous chairman.

Cosgrave helped save the company and set it on a path toward success, Alaska Airlines CEO Brad Tilden said in a statement after Cosgrave's death.

"Along the way, he took time to personally mentor me and many other leaders of the company."

Both Cosgrave and Kennedy retained strong ties to Alaska throughout their lives and both received honorary degrees from the University of Alaska Fairbanks.

In 2007, Cosgrave donated $2.6 million to the university, the largest gift ever from a living graduate. He said what he learned in Fairbanks all those years ago "had a profound effect on my life and helped me to achieve the success that I've enjoyed."

Dermot Cole is a Fairbanks columnist. The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary@alaskadispatch.com.