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Archive for Thursday, August 5, 1999

S EYE ON KU INSTITUTE

August 5, 1999

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KU officials say its program is no tool for Koch Industries. It keeps judges "intellectually alive."

A Kansas University legal institute is caught in the middle of a family feud between the wealthy Koch brothers of Wichita.

Spokesmen for Charles and Bill Koch are hurling charges and countercharges, accusing each other of manipulating the Wichita Eagle newspaper or, through KU, judges who might try their lawsuits.

The Wichita newspaper reported Sunday on the KU Economics Institute for State Judges, which was created with Koch Foundation underwriting. The report described trips by judges to luxury resorts in Utah and Florida during institute coursework.

Koch Industries of Wichita is run by Charles Koch, nemesis of brother Bill, best known for winning the America's Cup yachting trophy in 1992.

The story said the KU program, started with money from a Koch family foundation, might influence the judges from across the country who attend it.

In a Tuesday e-mail to employees, Koch Industries described the newspaper's story as part of a Bill Koch spin-doctoring campaign.

A company spokesman provided a copy of the two-page e-mail to the Journal-World.

"The viewpoint Bill Koch's agents are actively peddling is that Koch (Industries) participates in judicial education programs to try to buy off judges," the e-mail said.

But a Bill Koch spokesman blasted the Wichita newspaper, saying its report was a "softball" meant to defuse the impact of harder-hitting stories on the subject still expected from The Wall Street Journal, Tulsa (Okla.) World and Oklahoma City Daily Oklahoman.

Bill Koch spokesman Brad Goldstein described the Wichita Eagle as "bought and paid for by Charlie Koch."

Eagle Editor Rick Thames defended the story as legitimate no matter what the source.

"Virtually everyone has some agenda when they give us a tip," Thames said. "Our job is to evaluate that tip and determine independently if it is a legitimate news story."

The KU institute in question is part of the KU Law and Organizational Economics Center, which is jointly operated by the law and business schools. The Fred C. and Mary R. Koch Foundation has donated $1.3 million over four years to start and operate the program for judges. Bill Koch has a representative on the foundation board, according to Koch Industries.

State judges from across the United States attend the institute. It is accredited by about two dozen states for judges' continuing education.

Henry Butler, director of the Law and Organizational Economics Center and a Koch distinguished professor of law and economics, acknowledged the judges' institute conducts a week of its two-week seminars at resorts, but only after a week at KU.

Half of Butler's salary is paid by a Koch Foundation endowment.

Butler said the training program is based on one for federal judges at George Mason University and supported by more than 85 foundations, corporations and individuals.

In the seminars, judges learn concepts of classical economics and accounting and the relationship between those fields and the law. Butler said he decides what is offered in the classrooms for state judges from across the country.

"State judges have very few opportunities for serious continuing education," Butler wrote in a July 7 letter to an inquiring Wall Street Journal reporter. "... We are providing an important public service by keeping judges intellectually alive."

KU provided a copy of the letter to the Journal-World.

At least nine bitter lawsuits have grown out of the dispute among the Koch brothers, whose family founded Koch Industries, the nation's second-largest privately-held company. A 10th lawsuit goes to trial in October in Tulsa.

-- Erwin Seba's phone message number is 832-7145. His e-mail address is eseba@ljworld.com.

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