You are hereHuffington Post: Koch Brothers File Lawsuit Over The Ownership Of the Cato Institute
Huffington Post: Koch Brothers File Lawsuit Over The Ownership Of the Cato Institute
-By John Hanna
March 1, 2012- TOPEKA, Kan. — Billionaire brothers and political donors Charles and David Koch are pursuing a lawsuit in their native Kansas over the ownership of a libertarian-leaning think tank based in Washington, and the organization's CEO described it as a "hostile takeover" attempt.
The Koch brothers, known nationally for supporting conservative causes and candidates, also 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, Ed Crane, 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 give the shares back to the institute.
"We support Cato and its work," Charles Koch said in a statement. "We are not acting in a partisan manner, we seek no `takeover,' and this is not a hostile action. All we seek is adherence to 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. Wes Edwards, an attorney for the Koch brothers, said they've made multiple attempts to resolve the issue and are going to court "reluctantly."
But Crane said in a statement that while Charles Koch is trying to gain control of the institute. Crane said that while Charles Koch and entities he's controlled have provided financial support, he's had "no significant influence" over the institute's management, direction or work.
"We view Mr. Koch's actions as an attempt at a hostile takeover, and intend to fight it vehemently in order to continue as an independent research organization," Crane said.
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.