Koch Sued by Executive for False Imprisonment at Bear Ranch

Dueling lawsuits allege tax evasion, kickbacks and fraud

Oct. 15 (Bloomberg) -- William Koch held a senior executive of his Oxbow energy company captive for almost two days after discovering his concerns about a plan to avoid U.S. taxes on $200 million in profit, the now ex-employee said in a lawsuit.

Former Oxbow Senior Vice President Kirby Martensen alleged that an unrelated company probe revealed his misgivings over the purported effort by Oxbow Carbon & Minerals LLC. As a result, Martensen said, he was falsely imprisoned by Koch’s agents and interrogated at a remote Colorado estate as part of an attempt to intimidate him. He was also fired, he said.

In a statement posted on its website, the firm claimed that Martensen’s lawsuit was filed in response to the litigation in Florida over an alleged $40 million fraud at the company. Oxbow denied the allegations in Martensen’s lawsuit.

“In the spring of 2011, Oxbow initiated a yearlong investigation culminating in the dismissal of several executives and a civil complaint being filed last March,” the company said. “Martensen states in a lawsuit that we investigated him for participating in a wide-ranging scheme to defraud, accepting bribes and diverting business from our company. He is right. We absolutely investigated Martensen."

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