Archive for Thursday, March 1, 2012

Kochs file lawsuit over think tank ownership

March 1, 2012


— Billionaire brothers Charles and David Koch, known for supporting conservative political causes and candidates, are pursuing a lawsuit in their native Kansas over the ownership of a libertarian-leaning think tank based in Washington.

The Koch brothers are longtime shareholders in the Cato Institute, a research organization that promotes free-market, small-government policies. Their lawsuit seeks a court ruling that would leave the institute with only one other shareholder, its president and chief executive officer, Edward Crane III, who also is a defendant.

The brothers filed their lawsuit Wednesday in Johnson County District Court, arguing that the Kansas court has jurisdiction because the Cato Institute, while based in Washington, also lists an office in the Kansas City suburb of Overland Park. The brothers are the top executives at Wichita-based Koch Industries Inc., but the multibillion-dollar industrial firm is not involved in the lawsuit.

The lawsuit centers on the 25 percent ownership interest in the Cato Institute previously held by William Niskanen, who retired as chairman in 2008 and died in October. The Koch brothers contend that under shareholders' agreements in 1977 and 1985, his wife can't retain the shares and control his ownership interest but must sell the shares back to the institute.

"Over the past several months, Charles Koch and David Koch have made multiple efforts to resolve this issue," Wes Edwards, an attorney for the brothers, said in a statement. "Reluctantly, they believe the time has come to ask the court for help in confirming the meaning of the shareholders' agreement."

The two brothers are the only plaintiffs in the lawsuit, which names the institute, Crane and Kathryn Washburn, Niskanen's widow, as defendants. Chris Kennedy, the institute's media relations director, said Thursday that it was consulting with attorneys.

Charles Koch, a Wichita resident, is chairman and CEO of Koch Industries, which has about 67,000 employees worldwide and $110 billion in annual revenues, with interests that include oil refineries, fertilizer, chemicals, paper and pollution-control equipment. David Koch, who lives in New York, is the company's executive vice president.

They're frequent targets of criticism from progressive groups and the Occupy movement over their political activities. The small-government, anti-tax group Americans for Prosperity was founded with their support.

In its last annual report, the institute listed 120 employees and an annual budget of $23 million and said 80 percent of its revenues come from individuals.

The lawsuit said a foundation set up and named for Charles Koch in 1974 became the Cato Institute in 1976. On the institute's website, a 25th anniversary timeline says the institute was established in 1977 with Crane and Charles Koch as co-founders.

According to court documents, Niskanen signed the 1985 shareholders' agreement, the same year he became the institute's chairman, and David Koch became a shareholder in 1991.

Submitted with the lawsuit, the 1977 and 1985 shareholders' agreements said any shareholder wishing to sell his or her shares must first offer them to the institute. However, neither specifically deals with the death of a shareholder.


JayhawkFan1985 6 years, 3 months ago

Republicans fighting with republicans...where have I seen that before?

guess_again 6 years, 3 months ago

Just another John Birch Society, with a friendlier, kinder, trade name.

billbodiggens 6 years, 3 months ago

Huh, looks like they did not think that agreement through when they signed it, unless they just assumed they would all live forever. Some think tank.

Phillbert 6 years, 3 months ago

When will someone stand up and oppose liberals and their obsession with frivolous litigation? Oh, wait...

Guess the Kochs' definition of a "frivolous lawsuit" is any lawsuit they didn't file.

blindrabbit 6 years, 3 months ago

I'm suggesting a SuperPac to pay the Koch-a-Kolas legal fees. I'll start it with a buck!

progressive_thinker 6 years, 3 months ago

There is no doubt that the Koch brothers have influence on CATO. David Koch is on the CATO board of directors as was Rupert Murdoch during the late 1990's.

The CATO institute is little more than a mouthpiece for big corporate interests. They have no shame in distorting facts in the interests of big corporate interests, to the detriment of the public. A classic example is the work that they were involved in during the great debates over regulation of tobacco products. CATO was up to their eyeballs in big tobacco money. .

blindrabbit 6 years, 3 months ago

ShePrecedes: What flavor of Kool-Aid are you mixing with your Koch-A-Kola. The Cato Institute is rife with the Koch's, David is on the Board and a representative of the Charles Koch Trust is also a board member. Charles was a the founder of the group! Saying that the Cato Inst. is not GOP is like saying Reagan was not a conservative.

Don't know how you can read Cato and not buy Koch Products; they are one in the same!

Uhjh 6 years, 3 months ago

No such thing as a think tank! All they do is want an outcome and think of junk to justify it.

blindrabbit 6 years, 3 months ago

mustrum80 Don't buy your separation of current GOP, TeaParty and Cato. But being a Progressive Republican, who feels the real GOP was highjacked by social nuts, C-Street thinkers and The Good Olde Boys of the South many moons ago, I yearn for the old GOP!

headdoctor 6 years, 3 months ago

Unfortunately, the Republicans, Democrats, and Libertarians are all Neoliberals. It started with Reagan and every President since then has been including President Obama. Which makes me laugh when people start the typical Republican were against Socialism us against them argument when they both have Socialist agendas. The only real difference is the Democrats tend to be more socially liberal once you get beyond the usual bloated Socialist troughs like Social Security and Medicare issues. The Libertarians will never get their Neoliberal plan moving because what they want in their idea of a perfect world doesn't exist anywhere on the face of the planet. Many of their plans for reducing the size of Government wont work either. I am not sure why many modern Libertarians tend to lean more toward Anarchism than Libertarian. The only thing I can figure is maybe they think if everything gets shook up they will some how fair better than anyone else and in the end be on the top. Which is pretty arrogant and very similar to the old survivalists mentality which wasn't to bright of a plan either.

blindrabbit 6 years, 3 months ago

"Racking up debt" as you say; in reality the worst in the last 30 years were Reagan and the Bushes. Reagan did not raise taxes so much but ran us into huge debt by unfunded appropriations racking up the National Debt (all in the name of Conservatism). 41 was a continuation and did raise taxes; Clinton finally returned some sanity and a balanced budget and a healthy economy. 43 screwed up the whole deal, cut taxes to the detriment, started two trumped-up wars to repay daddy. Implemented a screwed-up No Child Left Behind Program! Now all you GOP-Cato's-Libertarians-TeaBaggers-NeoCons are hollering because you expected Obama to clean up the mess. Give up on the KoolAid, and leave women alone!

ThePilgrim 6 years, 3 months ago

"Clinton finally returned some sanity and a balanced budget and a healthy economy." Yeah right. The budget was not balanced. It figured in the Social Security surplus as General Fund surplus. Didn't put it in the "lockbox" after all.

And the the healthy eceonomy had little to do with Clinton and more to do with the dot com boom. The only boom that Clinton was following at the time was Monica.

headdoctor 6 years, 3 months ago

Yeah, Obama is getting blamed for everything including programs and situations that were started by Republicans. If the sun doesn't appear in the sky to suit the Republicans he gets blamed for it.

Kookamooka 6 years, 3 months ago

"Ha Ha". (Sung like that mean kid on the Simpsons.)

pace 6 years, 3 months ago

Very little about the widow, what does she say? Of course Kochies want to sue in a court they own.

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