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  1. Home
  2. / Investing

Lululemon's Rhoda Pitcher No Longer a Mystery

The lululemon director's background sheds light on the company's cult-like culture. 
By ANDERS KEITZ Jun 28, 2016 | 06:27 PM EDT
Stocks quotes in this article: LULU, AAPL, MSFT

This story has been updated to include a statement from Landmark and to clarify Werner Erhard was not charged with a crime.

For a week, lululemon athletica's (LULU) longest-serving and most influential director, Rhoda Pitcher, has refused to answer any questions about her background and qualifications to sit on the board of a $10 billion company. And the athleisure-wear maker has offered only a single, vague response to inquiries about Pitcher and her pedigree.

So Real Money went searching for answers and this is what we found.

Pitcher was born Rhoda Mona Hashman in Calgary, Alberta, in 1954 to Isaac and Edythe Hashman. She attended Henry Wise Wood High School in Calgary. There is no record of her graduating from an accredited college or university in Canada or the U.S.

She was married to Gary Paul Rosenbaum, who attended the University of Calgary possibly around the same time as lululemon founder and former CEO Dennis "Chip" Wilson. A representative of the university's alumni office lists a Rhoda Rosenbaum as a "friend and a donor," but added that she has not donated since 1999.

Pitcher and Rosenbaum divorced in the early 1990s, according to a source close to the family, and Rosenbaum died in 2000. Pitcher married Charles A. Pitcher in 1989, according to his LinkedIn profile. Charles Pitcher is connected professionally to Microsoft (MSFT) and Apple (AAPL), as listed on his LinkedIn. 

According to Rhoda Pitcher's lululemon bio, she received a master's degree in "Organization Development" from "University Associates Inc." (this was changed to exclude "Inc." on the site after our first article was published last week), but finding any trace of that school or program online has been difficult.

In 1982, Pitcher attended classes at the Western Institute of Group and Family Therapy in Watsonville, Calif., taught by Robert and Mary Goulding, said fellow classmate Burkhard Treude in a phone interview.

"It was gestalt therapy in combination with transactional analysis," he said. "They were giving workshops and trainings, and I was doing family therapy then. [Rhoda] had her own company."

"Transactional analysis" in conjunction with "redecision" therapy was a popular form of goal-setting and therapy used to set goals, in part by attempting to relive past events, according to Changing Lives Through Redecision, a book by Mary and Robert Goulding published in 1979.

This would have been around the time Werner Erhard co-founded the Center for Contextual Studies in 1983.

Real Money was able to track down a 1990 filing with the Canadian Intellectual Property Office that shows Rhoda Rosenbaum and Werner Erhard were partners in a company that operated as CCG International. The partnership was looking to trademark "Contextual Consulting" for business purposes.  

According to Bix Bickson, a Vancouver, British Columbia-based transformational consultant, Contextual Consulting was established in the early 1990s by Erhard and several associates, including Rhoda Rosenbaum.

Erhard is the creator of "est" -- Erhard Seminars Training. But the practice was labeled by some a cult "that practiced mind control (verbal abuse, sleep deprivation), a racket that exploited its followers (heavy recruiting, endless 'graduate seminars')," according to The New York Times.

Scandal surrounded Erhard in 1991. Having been accused in the media of tax fraud, abuse and incest, he left the country after he sold the evolution of est, Forum, to the employees. Erhard was not charged and later cleared of all allegations of wrongdoings. He also won damages in a lawsuit with the IRS for the false claim that he evaded taxes and accusations of incest were recanted by his daughter, according to the Times story.  

Forum would eventually evolve into Landmark. In an interview with Business Insider in 2013, Wilson said he learned about the Landmark Forum, which is a course offered by Landmark, through one of his partners in 1991. He said the workshop had a "monumental" impact, adding that without the course, lululemon "would have barely made it into the 21st century before going belly up."

In a statement, Landmark, which owns the retired est Training, said, "While over the years there have been some uninformed people who have claimed the est Training was cult-like or even a cult, independent top experts who personally observed the est Training have definitively stated that it was not a cult or cult-like. Quite the contrary, in fact. The consensus from experts is that the est training fostered and produced an enhanced capacity for people to think for themselves, and to participate in their own families, jobs, communities, religions, and so forth¿that they felt empowered and able to contribute effectively in the areas of life most important to them individually."  

Wilson brought Pitcher to lululemon for "management consulting services," for which she received $261,574 in fiscal 2006, double that of another consultant, Susanne Conrad, who took in $130,012. Pitcher's consulting services to lululemon ceased prior to the IPO.

She remains on lululemon's board, despite an original term expiration of 2009. She was nominated and re-elected to the board in 2009, 2012 and 2015.

Considering her ties to Erhard, whose practices in est were perceived as cult-like, it is easy to see where lululemon's reputation for being cult-like comes from.

Pitcher helms both the nominating and governance committees, in charge of putting the right people in management positions, and she is on the compensation committee.

Calls to lululemon's largest shareholders -- Fidelity, Capital Research and Management, Manning & Napier, Lone Pine Capital and BlackRock Fund Advisors -- to ask for their reaction were not immediately returned. Vanguard said it does not comment on individual companies.

Our calls to Pitcher and lululemon's public relations representative went unreturned. Chip Wilson declined to comment.

Pitcher has been paid upwards of $1.7 million by the company.

--Updated at 1:45 pm ET June 25, 2016, to clarify the timing of Pitcher's divorce.

--Carleton English, James Passeri, Tony Owusu, Denise Bedell, Aidan Dougherty, Henri Fernandez and Jason Keeschner contributed to this story. 

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TAGS: Investing | U.S. Equity | Corporate Governance

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