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Court rules for widow in Holiday World suit

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The widow and children of the late William Koch Jr. can keep their shares in the southern Indiana theme park, Holiday World and Splashin’ Safari, after a ruling by the Indiana Court of Appeals concluded that William’s brother, Dan Koch, and Koch Development Corp. offered too little money for the shares.

In Koch Development Corporation and Daniel L. Koch v. Lori A. Koch, as personal representative of the Estate of William A. Koch, Jr., deceased, 82A04-1212-PL-612, the COA affirmed the Vanderburgh Circuit Court’s judgment against Dan and KDC. The lower court held that Lori Koch was the owner of 49,611.6 shares of KDC stock and because Dan and KDC materially breached the shareholders’ agreement, she did not have to sell the shares to KDC and Dan.

Writing for the court, Judge Paul Mathias acknowledged the pain the family fight has caused.

“While we regret seeing a family divide itself over an internal business dispute, our role is to determine whether the trial court’s findings were supported by sufficient evidence and whether these findings support the trial court’s judgment,” Mathias wrote. “Here, the evidence favorable to the trial court’s decision supports the trial court’s conclusion that Dan and KDC materially breached the terms of the Agreement and that this material breach excused the Estate of its obligation to perform under the Agreement.”

The dispute erupted after Will Koch died unexpectedly in June 2010 and Dan Koch, who had been an attorney in Florida, became the president of KDC, the owner and operator of the amusement park.

Under terms of the Share Purchase and Security Agreement executed in 2002, Will, Dan and their sister, Natalie, dictated that upon the death of any shareholder, KDC would purchase all the shares of common stock owned by the decedent.

In December 2010, KDC and Dan offered to purchase Will’s shares from the estate for $26.9 million, based on the value of $541.93 per share. The estate rejected the offer claiming the shares were worth $653.07 each, putting the total purchase price at $32.1 million.

Before the COA, Dan argued that despite the minutes from a July 2009 shareholders’ meeting that valued the stock at $653.07 per share, the shareholders did not agree to that price. He claimed the trial court erred by excluding testimony from Natalie and himself that would have supported his contention.

The appellate court found the trial court properly rejected the testimony since Natalie “was a sufficiently interested party with interests adverse to those of the Estate.” In particular, she had acknowledged that she was worried if Dan lost control of KDC, he might not be able to repay her the more than $10 million he still owed for shares he previously had purchased from her.

Both the trial court and COA highlighted that neither Dan nor KDC made any effort to correct their initial offer within the 180-day limit imposed by the agreement. Dan asserted the time provision in the agreement was “boilerplate” language.

Again, the COA rejected Dan’s argument. It held that because the shares’ value could fluctuate significantly, the decedent’s shares should be purchased in a short period of time.

In upholding the trial court’s finding that Dan and KDC materially breached the terms of the agreement, the judges dismissed, in particular, Dan’s assertions that he would suffer forfeiture if the estate was allowed to keep Will’s shares and that he did not have enough time to fix the situation.

The COA noted that the agreement does not give Dan the right to run the family business, only the opportunity to purchase the shares of the decedent. As to Dan’s claim he needed more time, the court pointed out that instead of making any effort to adhere to the terms of the agreement, Dan and KDC “stubbornly stood by their initial, low-ball offers.”

Finally, the judges concluded there is ample evidence that Dan and KDC did not act in good faith. Specifically, it found that Dan planned to increase his salary to somewhere between $875,000 to $1.16 million in an effort to decrease the dividends that would have benefitted Lori and her children, and that he took loans and bonuses totaling $875,000 from KDC in order to pay the money he owed Natalie.

The COA concluded these material breaches of the agreement did excuse the estate from its obligation to sell Will’s shares to Dan and KDC.

Dan claimed that despite his and KDC’s material breaches and bad faith, the estate should still be required to sell its shares. However, the appellate court held that Dan’s position is in direct contradiction to well-established Indiana law, as discussed in Wilson v. Lincoln Fed. Sav. Bank, 790 N.E.2d at 1048 (Ind. Ct. App. 2003), that a party in a material breach of a contract cannot seek to enforce the contract against the non-breaching party.•

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  1. Have been seeing this wonderful physician for a few years and was one of his patients who told him about what we were being told at CVS. Multiple ones. This was a witch hunt and they shold be ashamed of how patients were treated. Most of all, CVS should be ashamed for what they put this physician through. So thankful he fought back. His office is no "pill mill'. He does drug testing multiple times a year and sees patients a minimum of four times a year.

  2. Brian W, I fear I have not been sufficiently entertaining to bring you back. Here is a real laugh track that just might do it. When one is grabbed by the scruff of his worldview and made to choose between his Confession and his profession ... it is a not a hard choice, given the Confession affects eternity. But then comes the hardship in this world. Imagine how often I hear taunts like yours ... "what, you could not even pass character and fitness after they let you sit and pass their bar exam ... dude, there must really be something wrong with you!" Even one of the Bishop's foremost courtiers said that, when explaining why the RCC refused to stand with me. You want entertaining? How about watching your personal economy crash while you have a wife and five kids to clothe and feed. And you can't because you cannot work, because those demanding you cast off your Confession to be allowed into "their" profession have all the control. And you know that they are wrong, dead wrong, and that even the professional code itself allows your Faithful stand, to wit: "A lawyer may refuse to comply with an obligation imposed by law upon a good faith belief that no valid obligation exists. The provisions of Rule 1.2(d) concerning a good faith challenge to the validity, scope, meaning or application of the law apply to challenges of legal regulation of the practice of law." YET YOU ARE A NONPERSON before the BLE, and will not be heard on your rights or their duties to the law -- you are under tyranny, not law. And so they win in this world, you lose, and you lose even your belief in the rule of law, and demoralization joins poverty, and very troubling thoughts impeaching self worth rush in to fill the void where your career once lived. Thoughts you did not think possible. You find yourself a failure ... in your profession, in your support of your family, in the mirror. And there is little to keep hope alive, because tyranny rules so firmly and none, not the church, not the NGO's, none truly give a damn. Not even a new court, who pay such lip service to justice and ancient role models. You want entertainment? Well if you are on the side of the courtiers running the system that has crushed me, as I suspect you are, then Orwell must be a real riot: "There will be no curiosity, no enjoyment of the process of life. All competing pleasures will be destroyed. But always — do not forget this, Winston — always there will be the intoxication of power, constantly increasing and constantly growing subtler. Always, at every moment, there will be the thrill of victory, the sensation of trampling on an enemy who is helpless. If you want a picture of the future, imagine a boot stamping on a human face — forever." I never thought they would win, I always thought that at the end of the day the rule of law would prevail. Yes, the rule of man's law. Instead power prevailed, so many rules broken by the system to break me. It took years, but, finally, the end that Dr Bowman predicted is upon me, the end that she advised the BLE to take to break me. Ironically, that is the one thing in her far left of center report that the BLE (after stamping, in red ink, on Jan 22) is uninterested in, as that the BLE and ADA office that used the federal statute as a sword now refuses to even dialogue on her dire prediction as to my fate. "C'est la vie" Entertaining enough for you, status quo defender?

  3. Low energy. Next!

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  5. OK, take notice. Those wondering just how corrupt the Indiana system is can see the picture in this post. Attorney Donald James did not criticize any judges, he merely, it would seem, caused some clients to file against him and then ignored his own defense. James thus disrespected the system via ignoring all and was also ordered to reimburse the commission $525.88 for the costs of prosecuting the first case against him. Yes, nearly $526 for all the costs, the state having proved it all. Ouch, right? Now consider whistleblower and constitutionalist and citizen journalist Paul Ogden who criticized a judge, defended himself in such a professional fashion as to have half the case against him thrown out by the ISC and was then handed a career ending $10,000 bill as "half the costs" of the state crucifying him. http://www.theindianalawyer.com/ogden-quitting-law-citing-high-disciplinary-fine/PARAMS/article/35323 THE TAKEAWAY MESSAGE for any who have ears to hear ... resist Star Chamber and pay with your career ... welcome to the Indiana system of (cough) justice.

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