How the manager of a plumbing-supply company got a little too interested in the female employees' plumbing

It started three years ago, with pencil-diameter holes strategically placed in the drywall of Miracle Supply Co.'s new unisex bathroom. Bookkeeper Betty Hofstetter -- 59 years old, struggling with her weight and horrified by the possibility of a peeper -- mentioned the holes to the company's founder and president, Martin Holtzman. He told her to have them caulked but refused to take any further action. She says Holtzman called his female employees (five of the plumbing-supply company's staff of 20) "overly sensitive."

When a larger hole appeared, this one offering a bird's-eye view of the toilet area from an adjacent bathroom, the women took their own action and covered it with a Band-Aid. Then, on April 10, 1997, Peggy Jackson walked into the bathroom, looked up and yelled for her mother, Norma Davidson, who also worked for Miracle. Hofstetter joined them in the bathroom, and all three agreed: The hole in the ceiling was definitely growing.

Hofstetter, 5-foot-3, stood on the toilet and stuck her finger in the hole. Soft and wet, the ceiling tile crumbled around her finger. "The roof had leaked onto the dropped ceiling -- that's what was making the hole bigger," she says. "But when I stuck my finger in, I felt something hard. There was something up there!"

They resolved to do a little exploring that afternoon, after company manager/vice president Mike Dattilo left on a weekend fishing trip. Hofstetter returned to her desk, but later she went back to the bathroom and, just in case, stuffed a piece of Kleenex in the ceiling hole. Toward noon, she saw Dattilo go into the bathroom and come out looking angry, carrying the Kleenex box. Then he left. With the coast clear, Jackson, 5-foot-7, climbed onto the toilet and pushed up the ceiling tile. Hidden in the recess were a coil of coaxial cable and two orange electrical cords.

The women traced the wiring into the furnace closet, down the wall and into the office Dattilo shared with the company president. (Holtzman, then 79, had begun spending winters in Florida.) The wiring went straight to an entertainment center with a big-screen TV, a VCR and a closed cabinet below. Behind those cabinet doors, the women found a second VCR they hadn't known existed. Kneeling, they moved aside some rags on top of the VCR, reached back and found a videocassette that had slid behind the VCR. Slowly they fed the video into the machine, hit "play" and saw the back of Jackson's head -- and her partially unclothed body -- as she used the toilet in what she'd believed was total privacy.

Jackson's use of the bathroom had been recorded at least 11 times, on different days, in clothes ranging from winter wools to spring cottons. But there was another woman on the video, a woman who, from behind, looked just like Laura Vaughn, the employee who did accounts receivable. Vaughn -- who'd been watching the video with them, but had stepped out to answer the phone -- heard them yelp her name. She came in to see a woman she, too, mistook for herself -- same light hair, same build from behind -- sitting stark-naked in the office bathroom, wiping herself repeatedly. "But I've never been at work naked!" Vaughn thought bemusedly.

The tape rolled on, and they realized that the light-haired woman was not Vaughn after all. To this day, she's referred to as the "mystery woman."

The only other subject on the video was Mike Dattilo himself, urinating as he glanced up toward the camera lens.

The women turned off the machine and spent the rest of the afternoon trying to figure out what to do. The next morning, Hofstetter gathered the other female employees and suggested they go to the University City police.

Nobody dared go. Finally Hofstetter picked up the phone and made the call herself.

The police came immediately, took photos and fingerprints, confiscated the video, a Fuji videotape jacket and a Chinon camera housing assembly. They also found a blued-steel .44-caliber Magnum and a box of American Eagle ammunition in Dattilo's desk. Frightened of the hot-tempered manager's reaction when he returned from his fishing trip on Monday, the employees begged the police to take the gun. To get permission to remove it from the premises, Det. Tim Hedrick rousted Holtzman, the company president, from a bridge game in Florida.

Unfazed by news of the covert surveillance but deeply anxious about bad publicity, Holtzman demanded to know who had called the police. He asked Hedrick to put Hofstetter on the phone, and he told her, "You will regret that decision the rest of your life." She started to cry. Hedrick took the phone and urged Holtzman to stand by his female employees. No one could hear Holtzman's reply, but Hofstetter remembers the detective slamming the phone into its cradle after his third attempt, then turning to them and saying, "You girls need an attorney."

Michael Dattilo was arrested that Monday and charged with 11 counts of invasion of privacy, a misdemeanor. He was back at work on Tuesday. Nothing more was said about the incident until Jackson, who had quit the company, sued Dattilo, Holtzman and Miracle Supply Co. for invasion of privacy.

"We didn't really think too much of it, honey," Holtzman says now, when a reporter inquires. "We didn't feel it was fair. But public opinion was against us, so we settled." He never once apologized to Jackson ("What for?" he retorted during deposition), and he never disciplined Dattilo. "In my opinion the whole thing wasn't that important," testified Holtzman in deposition. "Everybody goes off the deep end once in a while."

Dattilo never apologized, either, and doesn't talk about the case ("I'm not at liberty to discuss it, honey"). He testified in deposition that he never did understand why Jackson -- with whom he'd had a nine-month affair in the early '90s -- quit Miracle; he didn't see his videorecording as a big deal for her, and he thought she'd overreacted. He also said it never occurred to him that any of the employees would be upset to learn they'd been under surveillance (on the other hand, he admitted, he never thought they'd find the camera).

Dattilo said his only motive was to stop thievery at the company. For years there had been reports of petty cash missing ($40 or $50 at the most, according to Holtzman, who said in deposition that it never bothered him). Dattilo said he was worried about the cash-register receipts, too.

So he decided to place a camera in the bathroom.

On Jan. 28, 1997, he drove his company truck out to Alarm 24, on company time, and wrote a company check for $1,891.17, purchasing a time-lapse recorder, a box of cable, a power supply and a Chinon camera, and asking that the purchases not be itemized on the receipt. Dattilo told the salesman, Lindell Gray Jr., that he intended to install the camera in the warehouse. (He later testified that he'd planned all along to put it in the unisex restroom but felt that was "not their [Alarm 24's] business.")

Asked why he aimed the camera down at the toilet and focused it on the expected location of a user's buttocks, Dattilo explained that his focal point was near the trash can, where people could dispose of cash-drawer receipts. He also said that Hofstetter, who used that bathroom, was "probably the No. 1 suspect" in his mind.

So why didn't he record her?

"If I could prove that it was not Peggy that was doing it then I knew it was Betty," he replied, "and then I probably would have tape recorded her."

What about the mystery woman -- did he know what she was doing on his videotape "in a state of total disrobement"? Dattilo's attorney, John Gianoulakis, intervened swiftly: "I'll instruct the witness not to answer that question on the ground that the answer might tend to incriminate him."

When Dattilo was asked, "Did you watch any given scene that you had recorded more than one time?" Gianoulakis repeated that instruction.

Dattilo testified that he had to hit "record" and later rewind to see what he had recorded. But according to the Alarm 24 salesman, he could have monitored anything in the restroom as it happened without hitting a single button. "It just plays through," explained Gray in deposition. "It's just a straight through shot. You don't have to have it on play, or pause, or anything."

Dattilo admitted removing the camera on April 10 but swore he did not suspect it had been discovered. He'd pretty much concluded his investigation, he said, and took the camera (probably tucked into that Kleenex box) "just for the sake of removing it."

After Dattilo's arrest, female employees returned to find the office cleaned up -- erotic calendars gone, centerfolds ripped from the wall of the warehouse bathroom. They figured Dattilo's lawyer had suggested the whitewash. But months later, they learned Dattilo hadn't cleaned up at all; one of the nicer male employees, quietly sympathetic but worried about his job, had performed the task anonymously.

The blank walls didn't last, though. Slowly the wallpaper has returned, its only apology a newly hung "MEN'S ROOM" sign. (The women still have to use that bathroom whenever the sewer blocks up.) The company continues to cover Dattilo's Playboy subscription -- $34.96 a year, paid in full on Sept. 1 with a Miracle Supply Co. check and signed with a flourish by Dattilo himself. One of the company's traditional giveaways is a girlie calendar -- in 1999 it was called "Fantasies" and featured bathing-suit and lingerie models. The $1,118.33 invoice, sent to the attention of Mike Dattilo, was for 300 calendars (twice as many as the 150 "Puppy Pals" calendars they ordered for primmer clients).

Since the videotape incident, Dattilo and Holtzman have taken to examining unopened mail before giving it to Hofstetter to sort. Yet she recently found a catalog of sexual paraphernalia in her stack, and Dattilo left a jumbo envelope advertising Playboy's Tanned and Topless next to the fax machine she uses. Hofstetter still recalls Holtzman's reaction to last spring's political scandal: "Can you believe Clinton getting all those blow jobs for free?"

"The atmosphere was there," she says quietly, "for Mike to do what he did."

Hofstetter was offered $5,000 (the offer came from Holtzman, who later swore he was merely conveying it from Dattilo) to "let this thing go away." Instead she, too, filed suit in federal court and refused the settlement offered her. Early this month, she filed in St. Louis County, charging Dattilo, Holtzman and Miracle Supply Co. with invasion of privacy, intentional infliction of emotional distress, negligence and intrusion upon seclusion. There are three additional plaintiffs (each asking for at least $75,000 per count): Betty Hofstetter's daughter Linda Hofstetter (who, as a guest, used the bathroom); Josephine Leone (a temp worker at Miracle) and Laura Vaughn, who left Miracle in August. (Vaughn's husband borrowed on his 401k and told her to quit. "Now my butt's no longer there to be filmed," she says with satisfaction.)

Neither is Hofstetter's: On Oct. 11, the day he was served with Hofstetter's second lawsuit, Dattilo called her into his office and told her to leave. According to Ira Blank, attorney for Miracle Supply Co., Hofstetter can't sue them; she filed suit in 1997 and refused the proffered settlement, so her suit was "dismissed with prejudice." Because of the confidentiality agreement in the Jackson settlement, that's all he's able to say.

Hofstetter's new attorney, Greg Roose-velt, says her first suit was based on federal sexual-harassment law, whereas this claim is based on state law. The judge will have to rule on its legality. Meanwhile, when Hofstetter showed up this Monday, she says, she was blocked from going to her desk and told the letter of termination was in the mail; she'd made too many phone calls and missed too much work. She's terrrified about finding a new job, but she's not sorry to be gone. After the videotape was discovered, Holtzman made no secret of his anger, saying she was "trying to bring down the company." She's gained back 40 pounds, and she's been wearing extra-long tops and turning out the lights every time she urinates at work.

Hofstetter stayed years at Miracle because, for a woman her age without a college degree, the pay was good ($22,000 base pay plus an annual bonus around $12,000) and she needed the health insurance. She's been divorced for years, since leaving an abusive husband. She has five children, now grown, plus an elderly mother and a brother and sister with developmental disabilities.

Dattilo's total compensation in the year the incident occurred was $265,000. He drove a company-supplied Chevrolet Tahoe and, according to his deposition, once took a company-paid trip to the Arctic to hunt caribou with a client who was a friend. After the arrest, Holtzman paid for his visits, on company time, to a psychiatrist. (When Hofstetter's physician suggested she see a psychologist to cope with the stress, she had to struggle to find appointment times -- "I couldn't miss work.")

For Dattilo, at least, Holtzman proved an extraordinarily forgiving boss. On the other hand, he wasn't in any position to throw stones. In his deposition, he admitted asking Hofstetter for oral sex several years before. "I never got a response out of her," he told the lawyers. "She didn't answer me so I figured maybe she needed some time to think it over." He admitted that Hofstetter had never done anything to indicate interest or willingness but insisted that his request was not sexual harassment: "How would I know if she was going to do it unless I asked her?" After the videotaping arrest, Hofstetter reminded him that his request had hurt her, but Holtzman only seemed puzzled. She says he told her she "should have felt honored ... it would have been a privilege."

Hofstetter also mentioned, in her deposition, a time when Holtzman "came at my breasts.... I slapped his hands and moved his hands away from me and I fell over a chair in the process. And when I fell over the chair, he accused me of getting excited."

According to the University City police report, other employees had similar problems. Davidson recalled a period of four or five years when Holtzman would frequently grab her breast or buttock but "try to make it seem like an accident." Vaughn told police that Holtzman had rubbed against her from behind on two occasions but tried to make it seem like an accident. When deposed, even quiet Cynthia Racher revealed a time in the early '80s when "Martin came up behind me and he pushed up against me and ... I was dumb and stupid and naive enough at the time to think he was leaning against me that day because he was tired from driving the truck.... He didn't say anything about anything that had to do with what he was doing. It was just conversation. Then he started breathing hard and I think I could even -- well -- "

"You thought he might have an erection?" the lawyer prompted.

"I thought I was feeling something there." But, she added quickly, "I didn't suffer any trauma or anything."

The women who've chosen to sue say they have suffered, and Dattilo and Holtzman still don't have a clue. "We need to make it public, and we need to deal with it," says Hofstetter. "Because they obviously can't."

Patricia Ireland, president of the National Organization for Women (NOW), will join a "Women-Friendly Workplace" protest/picket outside Miracle Supply Co., 1580 North and South Rd., at 11 a.m. on Nov. 11.

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