Sons of Wichita: How the Koch Brothers Became America's Most Powerful and Private Dynasty

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Sons of Wichita: How the Koch Brothers Became America's Most Powerful and Private Dynasty Page 42

by Daniel Schulman


  13. “I’m a celebrity in Kansas”: “Pulling the Wraps off Koch Industries,” The New York Times, November 20, 1994.

  14. admiral of the Kansas Navy: “Koch in Command of Kansas’ Proud But Land-Locked Navy,” The Wichita Eagle, December 11, 1994.

  15. “She took my brothers’ side”: “Koch Names Yacht After His Mother,” The Wichita Eagle, March 3, 1995.

  16. “the best coverage money can buy”: “Ethics Questions Arise as Koch Courts Media,” Kansas Business Report, October 1, 1994.

  17. “listening to the suitors”: “Koch May Set Sail in Race Against Brownback,” Lawrence Journal-World, December 27, 1997.

  18. “Billy wouldn’t even have a rowboat”: “Pulling the Wraps off Koch Industries.”

  19. rejected a $50,000 contribution: “Rival Koch Brothers Sporting Controversy,” Topeka Capital-Journal, November 23, 1997.

  20. “I’ve had a lot of bad PR”: Ibid.

  21. barreled through the intersection: “Loss of 12-Year-Old Zac Pains Family, Classmates,” The Wichita Eagle, September 21, 1993.

  22. “every eye in that church was on them”: “Koch and His Empire Grew Together,” The Wichita Eagle, June 26, 1994.

  23. 100 hours of community service: “Teenager Gets Service Work, Probation,” The Wichita Eagle, January 12, 1994.

  24. “our whole strategy was that no one needed to know anything”: “Pulling the Wraps off Koch Industries.”

  25. “You won’t even see his smoke”: “Koch’s Hidden Message: Houston Expansion Is About More Than Business,” The Wichita Eagle, March 23, 1997.

  26. “We’re up against a very secretive company”: “Journalists, or Detectives? Depends on Who’s Asking,” The New York Times, July 28, 1999.

  27. “has wiretapped their discussions”: Michael P. Aquilina v. William I. Koch, et al. (C.D. Cal., 1988), declaration of Michael P. Aquilina, July 18, 1988.

  28. “I didn’t authorize using it, and never will”: “Wild Bill Koch.”

  29. “The recording wasn’t worth shit”: Ibid.

  30. resulted in a temporary restraining order: Koch v. Koch Industries, Memorandum and Order, March 20, 1998.

  31. “a man whose closet is free of skeletons”: “Wild Bill Koch.”

  32. “Santa Barbara surfing girl”: “Koch: Mistress Wanted $5 Million,” Boston Herald, November 21, 1995.

  33. “She started kissing me quite passionately”: “Housing Court Hears Billionaire Tell of Love Affair Gone Bad,” The Boston Globe, November 15, 1995.

  34. “Hot Love From Your X-rated Protestant Princess”: “Eviction Style of Very Rich Titillates Boston,” The Philadelphia Inquirer, November 23, 1995.

  35. “My poor nerve endings are already hungry”: Facing Up to the Fax, The Boston Globe, November 22, 1995.

  36. “It is beyond calculation”: “Court Hears Lurid Faxes of Ex-Model, Millionaire.” Associated Press, November 28, 1995.

  37. “There were moles and spies all over”: “Wild Bill Koch.”

  38. drafted a bogus memo: Koch v. Koch Industries, Plaintiffs’ Reply Brief in Support of Plaintiffs’ Motions in Limine, March 25, 1998.

  39. “he changed completely”: “Wild Bill Koch.”

  40. “This is war”: “On an Outside Tack,” The Boston Globe Magazine, April 19, 1992.

  41. “Keep the King”: Larsen, To The Third Power, pp. 105–6.

  42. “I wasn’t alone”: “Cup Costs, Spying Irk Koch,” Palm Beach Post, May 16, 1992.

  43. hired Italian speakers: “Wild Bill Koch.”

  44. “how many times we go to the bathroom”: “Bold Espionage Tactics Stir Up Cup Emotions,” Los Angeles Times, May 9, 1992.

  45. spent more than $2 million: “Old Fashioned Spying Aids America,” Boston Herald, May 16, 1992.

  46. “the Bill Koch rule”: “Wild Bill Koch.”

  47. $300 per interview: Koch v. Koch Industries, Plaintiffs’ Reply Brief in Support of Motion to Re-Open Discovery, December 29, 1995.

  48. “I would gain from 3 to 4 barrels of oil”: Koch v. Koch Industries, Plaintiffs’ Reply Brief in Support of Motion to Re-Open Discovery, affidavit of Robert Gould, July 22, 1988.

  49. “Always help Charlie out”: USA v. Koch Industries (S.D. Tex., 1995), deposition of David F. Toliver, October 17, 1995.

  50. “Keep Old Charlie Happy”: Interview with Bob Buford.

  51. “Top management-directed theft”: Hearings Before the Special Committee on Investigations of the Select Committee on Indian Affairs, US Senate, 101st Congress, “Natural Resources on Indian Lands,” May 9, 1989.

  52. Bill’s “vendetta.”: “U.S. Attorney Handling Oil Theft Probe,” Associated Press, June 25, 1989.

  53. “political skullduggery”: “Bob Dole’s Oil Patch Pals,” BusinessWeek, March 31, 1996.

  54. hired a group of high-powered Democratic lobbyists: “The Kochs Can Play Washington’s Power Game,” The National Journal, May 16, 1992.

  55. “systematic theft”: A Report of the Special Committee on investigations of the Select Committee on Indian Affairs, US Senate, 101st Congress, “A New Federalism for American Indians,” November 20, 1989.

  56. stolen at least $31 million worth of oil: Ibid.

  57. “the pattern of oil theft is so pervasive”: Frederick Koch to Mary Koch, November 23, 1989; letter in possession of the author.

  58. “come back in a body bag”: “D(oil)e,” The Nation, August 26, 1996.

  59. “U.S. government to brand you as a racketeer”: “Blood Feud,” Wall Street Journal, August 9, 1989.

  60. “I was cold-blooded and Machiavellian”: “The Curse on the Koch Brothers,” Fortune, February 17, 1997.

  61. “I almost wish”: “Blood Feud,” Wall Street Journal, August 9, 1989.

  62. “the stage for the unraveling of a family”: “Survival of the Richest,” Fame, November 1989.

  63. “a man consumed by hatred”: Koch v. Koch Industries, Defendants’ Brief in Opposition to Plaintiffs’ Eight Motions in Limine, February 20, 1998.

  64. “a childhood tussle on the school playground”: Koch v. Koch Industries, Memorandum and Order, March 23, 1998.

  65. The seating had even been arranged: “Attorneys Focus on Koch Brawls,” Associated Press, April 13, 1998.

  66. “surpassed $200,000 per week”: “Zero Is the Verdict in $2 Billion Koch Family Feud,” The New York Times, June 20, 1998.

  67. “There’s no poor people”: “All Four Brothers Attend Trial Opening,” The Wichita Eagle, April 7, 1998.

  68. “Business is war”: “The Billionaires’ Brawl,” USA Today, April 8, 1998.

  69. “a truly fascinating Kansas family”: Koch v. Koch Industries, trial transcript.

  70. “peace that has never come to Kansas”: Ibid.

  71. “This is tough to talk about”: Ibid.

  72. “largely involved in charitable activities”: Ibid.

  73. Bartlit launched his examination: Ibid.

  74. “Work for Koch Industries”: Ibid.

  75. “distracted and preoccupied”: “Kochs’ Friends Prepare for More Legal Action,” The Wichita Eagle, June 20, 1998.

  76. hundreds of layoffs: “Layoffs Follow Koch Setbacks,” The Wichita Eagle, April 11, 1999.

  77. “The only thing that people like this recognize”: Koch v. Koch Industries, trial transcript.

  78. for research purposes: “Koch Trial Inspires Man to Study Law,” The Wichita Eagle, July 22, 2000.

  79. “They’re guilty of misrepresentation”: “Koch Inc. Prevails,” The Wichita Eagle, June 20, 1998.

  80. “the jury unanimously ruled”: “Kochs’ Friends Prepare for More Legal Action,” The Wichita Eagle, June 20, 1998.

  81. Charles delivered the news: “Koch Inc. Prevails,” The Wichita Eagle, June 20, 1998.

  82. “breath or money”: “Blood Feud,” Wall Street Journal, August 9, 1989.

  83. “15-round championship fight”: “Zero Is the Verdict in $2 Billion Koch Family Feud,” The
New York Times, June 20, 1998.

  Chapter 11. There Will Be Blood

  1. plans for her farewell party: “Two Teens Mourned in Kaufman County Blast,” Dallas Morning News, August 26, 1996.

  2. buy him a new Harley: Smalley v. Koch Industries (86th Tex., 1997), testimony of Danny Smalley.

  3. The smell had gotten worse: “Blast That Killed 2 Teens Exposed Koch’s History of Harmful Mistakes,” Austin American-Statesman, July 23, 2001.

  4. “like it was strafed by Napalm”: Smalley v. Koch Industries, testimony of George York.

  5. “You’re no God!”: Ibid.

  6. The pressure in the Sterling I pipeline: Smalley v. Koch Industries, testimony of Danny Mills.

  7. Unknown to Danny Smalley: “Blast That Killed 2 Teens.”

  8. “Good God”: Smalley v. Koch Industries, trial transcript.

  9. All he saw was her burnt corpse: Smalley v. Koch Industries, testimony of Danny Smalley.

  10. became suicidal: Interview with Ted Lyon.

  11. offering $10 million: Interview with Marquette Wolf.

  12. the decrepit state: “Oil Spills Bring 2nd Koch Probe,” Minnesota Star Tribune, May 3, 1998.

  13. just 420 gallons of oil had spilled: Ibid.

  14. Koch officials pleaded the Fifth Amendment: P.D. Hamilton v. Koch Industries (E.D. Tex., 2001), affidavit of Linda Eads.

  15. “Many of Koch’s spills”: USA v. Koch Industries (S.D. Tex., 1995), affidavit of Philip Dubose.

  16. hired a security firm to sweep for listening devices: Interview with Ted Lyon.

  17. the company was having Danny Smalley tailed: Ibid.

  18. The supervisor’s callous response: Smalley v. Koch Industries, deposition of Kenoth Whitstine.

  19. “Given the time-value of money”: P.D. Hamilton v. Koch Industries, affidavit of Linda Eads.

  20. it could reap an additional $8 million: “Blast That Killed 2 Teens.”

  21. evidence of corrosion in 583 locations: Ibid.

  22. “Koch Industries is definitely responsible”: Smalley v. Koch Industries, deposition of Billy Ray Caffey, April 14, 1999.

  23. “Money to them is blood”: Smalley v. Koch Industries, testimony of Danny Smalley.

  24. “There is no more horrible death”: Smalley v. Koch Industries, trial transcript.

  25. failed to corroborate the charges: “Grand Jury Clears Koch Oil No Charges Planned in Indian Lands Case,” The Daily Oklahoman, April 3, 1992.

  26. “Bill Koch has been attacking Charles”: “Bill Says He Wants to Reconcile with Charles,” The Wichita Eagle, September 26, 1999.

  27. plunged into darkness: “Koch Courtroom Is a Multimedia Spectacular, The Wichita Eagle, October 24, 1999.

  28. Bell displayed a pyramid of photographs: “Sides Trade Shots as Latest Koch Trial Starts,” The Wichita Eagle, October 5, 1999.

  29. sent copies of the tape: Interviews with Marquette Wolf and Ted Lyon.

  30. Seated at the cramped counsel’s table: “Former Employees Across Midwest Testify,” Associated Press, October 7, 1999.

  31. “I felt that it was stealing oil”: “Former Koch Industries Workers Describe ‘Bringing in the Barrel,’ ” Associated Press, October 8, 1999.

  32. “It was enough to bother my conscience”: “Ex-Koch Gaugers Tell of Underreporting,” Tulsa World, October 9, 1999.

  33. “I feel like I’m up here telling the whole world”: “Former Koch Manager Says Oil Adjustments Discussed at Meetings,” Associated Press, October 15, 1999.

  34. “I had to do what they said to do”: “Former Koch Workers Testify About Oil Collection,” The Wichita Eagle, October 7, 1999.

  35. “I made what I felt were necessary and fair adjustments”: “Koch Oil Rebuts Allegations of Gauge Cheating,” Tulsa World, November 10, 1999.

  36. “explained to me the nature of the crude oil measuring business”: “Oil Firm’s Chief Executive Defends Company at Tulsa, Okla., Trial,” Tulsa World, December 10, 1999.

  37. “accepted on both sides”: “Oil Company Owner Gives His Side of the Story,” Associated Press, December 10, 1999.

  38. “they’re going to take volume away from you”: “Tulsa, Okla., Jury Hears Last Day of Testimony in Oil-Theft Trial,” Tulsa World, December 11, 1999.

  39. found Koch guilty of nearly 25,000 false claims: “Jury Finds Koch Underreported Oil Purchases,” Associated Press, December 24, 1999.

  40. “Billy has stalked his brothers”: “Koch Industries, Oil Industry Disappointed by Verdict,” Koch Industries, December 23, 1999.

  41. “a company that practiced organized, white-collar crime”: “Jury Finds Koch Cheated,” Tulsa World, December 24, 1999.

  42. “There were times when… yeah, we lied”: “State Took Koch at Its Word in False Records Case,” Minnesota Star-Tribune, July 19, 1998.

  43. Woodlief asked his distracted boss for a word: Interview with Tony Woodlief.

  44. “egregious violations”: “Koch Industries to Pay Record Fine for Oil Spills in Six States,” Department of Justice, January 13, 2000.

  45. “We should not cave in”: “The Business Community: Resisting Regulation,” Libertarian Review, August 1978.

  46. “While business was becoming increasingly regulated”: Charles Koch, The Science of Success (Wiley, 2007), pp. 44–45.

  47. “It was something he could not get over”: “How Angela Outslicked Oilman Ex,” New York Post, February 20, 2001.

  48. “He was not fun to be around”: Ibid.

  49. threatened “to beat his whole family to death with his belt”: “Yachtsman Bill Koch Charged with Domestic Abuse,” Associated Press, July 20, 2000.

  50. Angela was granted a restraining order: “Palm Beacher Bill Koch Under Restraining Order,” Palm Beach Post, July 21, 2000.

  51. “It was frightening, and embarrassing”: “How Angela Outslicked Oilman Ex,” New York Post, February 20, 2001.

  52. “I’ll litigate you into the ground”: Ibid.

  53. she dropped a civil suit against Bill: “Domestic Violence Charges Against Koch Are Dropped,” The Boston Globe, December 6, 2000.

  54. “I liked looking at it when I was happily married”: “Koch’s Delight,” Palm Beach Daily News, December 31, 2000.

  55. eventually settled for $25 million: “Koch Brothers End 21-Year Feud,” The Wichita Eagle, May 26, 2001.

  56. initiated a cautious rapprochement: “Koch Brothers Settle Suit,” Palm Beach Post, May 27, 2001.

  57. “During the settlement discussions”: George T. M. Shackelford and Elliot Bostwick Davis, Things I Love: The Many Collections of William I. Koch (MFA Publications, 2005), p. 37.

  58. “We ended up in a heated argument”: “Why Does Bill Koch Collect So Much Stuff? ‘I Collect What Makes Me Feel Good,’ ” Palm Beach Post, September 18, 2005.

  59. “organized crime”: “Blood & Oil,” 60 Minutes II, November 28, 2000.

  60. “There’s nothing more explosive”: “Koch Brothers Finally Bury the Hatchet After 20 Years,” Cox News Service, May 29, 2001.

  61. Out of all the other children at the preschool: “The Price of Immortality,” Portfolio, October 15, 2008.

  62. Bill and Bridget invited David and Julia: “Koch Birthday Bash a Studio 54 Redux,” Palm Beach Daily News, May 5, 2002.

  63. “Welcome to El Sarmiento”: “Don’t Look for Sympathy on Royally Insulted Island,” Palm Beach Daily News, December 7, 2003.

  64. “Who would have thought 10 years ago”: “28-Story Mast to Be Visible For Miles,” Palm Beach Post, February 20, 2005.

  65. “Come to the Emerald City”: “Billionaire David Koch had a Wizard of Oz-Themed Birthday Party,” New York, May 18, 2010.

  66. “the brother of the twin”: “Inside the Koch Empire: How the Brothers Plan to Reshape America,” Forbes, December 5, 2012.

  67. “peaceful coexistence”: “Bill Koch’s Wild West Adventure,” 5280, February 2013.

  Chapter 12. Planet Koch

  1. “I just
bought Georgia-Pacific”: Interview with John Damgard.

  2. “We thought we were in the oil business”: “Market-Based Management at Koch Industries: Discovery, Dissemination, and Integration of Knowledge,” Competitive Intelligence Review, Vol. 6, No. 4, 1995.

  3. asbestos-related lawsuits: “Georgia-Pacific Choked by Asbestos Lawsuits,” Atlanta Business Chronicle, January 29, 2001.

  4. reliance on untested theories: Brian Doherty, Radicals for Capitalism, (Public Affairs, 2007), p. 409.

  5. It deemphasized job titles: “Profitable Theory—Market Based Management Drives Koch Industries,” The Wichita Eagle, December 3, 2005.

  6. “Everybody’s after everybody else’s throat”: “A Company Tries to Manage the Future,” The Wichita Eagle, June 27, 1994.

  7. “generally hiring one type of ‘clone’ ”: Gary Gorman v. Koch Industries (D. Kan., 1997), complaint.

  8. “The concepts became little more than buzzwords”: Charles Koch, The Science of Success (Wiley, 2007), p. 42.

  9. “Koch has a pattern of delaying”: P. D. Hamilton vs. Koch Industries, affidavit of Linda Eads.

  10. “If I get a concept in my head”: “Mr. Big,” Forbes, March 13, 2006.

  11. ignited an acrimonious uprising at the school: “Collegiate Parents in Uproar over Resignation,” The Wichita Eagle, March 5, 1993.

  12. hung in effigy around campus: “Interim Chief at Collegiate Is Seeking Solution,” The Wichita Eagle, March 7, 1993.

  13. “the Shadow falling on Rivendell”: “Shadow of the Kochtopus,” Aaeblog.com, May 5, 2008.

  14. “stamped on the time cards of factory workers”: “Big Brothers,” The Nation, April 21, 2011.

  15. recruiting talent from elite universities: Interview with Tony Woodlief.

  16. “discredited science”: “Perspective,” Discovery, April 2008.

  17. “the greatest loss of liberty”: “Perspective,” Discovery, January 2008.

  18. “Imagine what our world could be like”: “Perspective,” Discovery, October 2008.

  19. “the George Orwell book, 1984”: Glassdoor.com.

  20. “in a fifty-fifty deal”: “The Curse on the Koch Brothers,” Fortune, February 17, 1997.

  21. “I am Charles Koch”: “The Front Lines: Charles Koch Teaches Staff to Run a Firm Like a Free Society,” Wall Street Journal, April 18, 1997.

 

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