Go to content Go to navigation Go to search

May 29, 2008

Health Center's Ties to Foundation Questioned in Investment Controversy

Employees of U.S. Sugar company are questioning the relationship between the Mott Children’s Health Center, a charity in Flint, Mich., and the Charles Stewart Mott Foundation and the Mott family, reports The New York Times.

In 1969 Mott heirs gave a large number of shares in U.S. Sugar to the charity, which used the dividends as operating revenue. In 2005, an attempted corporate takeover of U.S. Sugar would have provided the charity with $125-million. But the offer fell through, and the company stopped providing dividends.

Former employees of U.S. Sugar say needy children of Flint are the victims of the same financial maneuvering that has ruined the workers’ retirement plan. The stock, which was valued at $153 a share in 2005, rose to $293 a share. But after the takeover failed, the stock became essentially worthless.

The former employees have filed a lawsuit against the company and other shareholders, saying the medical center had an “unlawful agreement” linking its holdings to the foundation.

A lawyer for the health-care center said he could not discuss details related to the case. The Mott Foundation has denied that it had any kind of improper investment agreement with the center.

(Free registration is required to view this article.)

Thursday May 29, 2008 | Permalink

Commenting is closed for this article.

Previous: IRS Makes Changes Intended to Help Donors
Next: Wealthy Financiers Give Less as Wall Street Struggles

---

Copyright © 2009 The Chronicle of Philanthropy