March 2, 2012 5:46 PM

Koch Brothers Turn to Stinson Morrison in Lawsuit Against Cato Institute

Posted by Claire Zillman

Billionaire brothers Charles and David Koch have hired Stinson Morrison Hecker to represent them in a lawsuit against libertarian think tank The Cato Institute.

Stinson Morrison partners Daniel Crabtree and Heather Woodson of the Kansas City, Missouri-based firm are listed as the Kochs' lawyers on the complaint filed in state court in Johnson County, Kansas, on Wednesday. The basis of the suit is the brothers' claim that they should have the option to buy the shares in Washington, D.C.–based Cato that belonged to the nonprofit's chairman, William Niskanen, before he died in October at age 78. (The Kochs already own 50 percent of Cato.) 

According to the complaint, which was posted online by The Washington Post, the Cato Institute believes those shares belong to Niskanen's widow, Kathryn Washburn. Washburn is named as a defendant in the Kochs' suit, the institute and Ed Crane III, a Cato shareholder who serves as its director and president.

In a statement released Thursday, Crane called the suit a "hostile takeover" that Cato intends to fight vehemently.

"Koch's actions in Kansas court yesterday represent an effort by him to transform Cato from an independent, nonpartisan research organization into a political entity that might better support his partisan agenda," the statement said. A Cato spokesman told The Am Law Daily via e-mail that Cato has retained counsel to defend against the suit, but did not immediately identify the lawyers. 

Stinson Morrison Hecker, a 275-lawyer firm, was created in 2002 when Kansas City stalwarts Stinson, Mag & Fizzell and Morrison & Hecker merged. The firm's eight offices include one in Wichita, where Koch Industries, the Koch brothers' privately held energy company, is based. According to Forbes, Koch Industries is the second-largest private company in the United States after Cargill, with annual revenue estimated at $100 billion.

Crabtree and Woodson, both of whom are members of the firm's business litigation group, did not immediately return requests for comment. The firm's spokeswoman also did not immediately respond to a request for comment. According to the Stinson Morrison Web site, the firm has represented Koch Industries and Invista, a Koch Industries subsidiary, in past corporate transactions, although the site does not list specific deals. Also of note: Stinson Morrison hosted a tennis tournament last June at the Koch Tennis Center in Omaha. 

According to The American Lawyer's reporting, Stinson Morrison saw its gross revenue dip 0.3 percent from $144 million to $143.5 million in 2011. Profits per partner slipped 4.3 percent to $505,000, and the firm lost eight lawyers, or 2.8 percent of its total head count. Based on its 2010 financial performance, Stinson Morrison landed at number 165 on last year's Am Law 200 ranking.

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