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Archive for Thursday, March 1, 2012

Kochs file lawsuit over think tank ownership

March 1, 2012

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— 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.

Comments

pace 2 years, 1 month 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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Kookamooka 2 years, 1 month ago

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

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blindrabbit 2 years, 1 month 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!

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blindrabbit 2 years, 1 month 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!

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Uhjh 2 years, 1 month ago

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

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blindrabbit 2 years, 1 month 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!

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mustrun80 2 years, 1 month ago

This comment was removed by the site staff for violation of the usage agreement.

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ShePrecedes 2 years, 1 month ago

Cato is not GOP. Been reading from them for years. Didn't really look to see if Koch had influence. Surprised by this news.

I side with Cato. I boycott all Koch products, when I can and when I know that I have the option.

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blindrabbit 2 years, 1 month ago

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

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Phillbert 2 years, 1 month 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.

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billbodiggens 2 years, 1 month 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.

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Agnostick 2 years, 1 month ago

Aahh, the sound of infighting....

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guess_again 2 years, 1 month ago

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

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JayhawkFan1985 2 years, 1 month ago

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

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Gandalf 2 years, 1 month ago

Once the kochs have exclusive control, it will go from a think tank, to a thought tanked!

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