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Common Ground Independent Media


Re: Koch Industries Responds to Rolling Stone And RS Answers Back

Posted By: C-lo
Date: Tuesday, 7-October-2014 21:21:39

In Response To: Inside the Koch Brothers' Toxic Empire (C-lo)


By Tim Dickinson | September 29, 2014

Koch Industries has written a lengthy response to our feature story on the company in the latest issue of Rolling Stone. In tweets the company apparently paid to promote, Koch bills this write-up as a "point-by-point response to Rolling Stone writer Tim Dickinson's dishonest and misleading story." The salient feature of Koch's response is that the company does not argue the core facts of our 9,000-word expose. Instead, Koch targets the messenger. Koch's top target here is not even Rolling Stone, but me, Tim Dickinson.

I find it, frankly, amusing that a company that has been convicted of six felonies and numerous misdemeanors; paid out tens of millions of dollars in fines; traded with Iran, and been so reckless in its business practices that two innocent teenagers ended up dead, attempts to impugn my integrity, and on the basis of my association with Mother Jones where I worked as an editor in the late 1990s and early 2000s, on a team that was twice nominated and once awarded a National Magazine Award for General Excellence.

Koch, in particular, takes umbrage with my reporting practices.

For the record: In the weeks prior to publication, beginning September 4th, Rolling Stone attempted to engage Koch Industries in a robust discussion of the issues raised in our reporting. Rolling Stone requested to interview CEO Charles Koch about his company's philosophy of Market Based Management; Ilia Bouchouev, who heads Koch's derivatives trading operations, about the company's trading practices; and top Koch lawyer Mark Holden about the company's significant legal and regulatory history.

The requests to speak to Charles Koch and Bouchouev were simply ignored. Ultimately, only Holden responded on the record, only via e-mail and only after Holden baselessly insinuated that I had been given an "opposition research" document dump from the liberal activist David Brock. (This is false.) From my perspective as a reporter, Koch Industries is the most hostile and paranoid organization I've ever engaged with and I've reported on Fox News. In a breach of ethics, Koch has also chosen to publish email correspondence characterizing the content of a telephone conversation that was, by Koch's own insistence, strictly off the record.

In an attempt to negotiate an on-the-record interview, Rolling Stone had sent Holden a series of discussion topics. Holden and the Koch communications team treated these general topics, instead, as though they were specific questions and provided the voluminous responses they have reproduced, inventively, as a Q&A on their website.

These responses were not "ignored," as Koch suggests. In part, they contain useful background information, and they informed my reporting of the story. But in the main, the Koch responses attempt to re-litigate closed cases incidents where judges, juries, and, in one case, a Senate Select Committee, have already had a final say. They only muddy waters that have been clarified by a considered legal process.

Where Koch attempted to provide additional context, it was frequently hairsplitting and obfuscatory. For example, in the case of the felony conviction at the Corpus Christi refinery, Holden insisted: "the case did not involve any penalty for benzene emissions." However the count that Koch pleaded guilty to April 2001 reads, in part: "defendant KOCH PETROLEUM GROUP, L.P., did knowingly and willfully falsify, conceal and cover up by trick, scheme and device material facts in a matter within the jurisdiction of the Texas Natural Resources Conservation Commission and the United States Environmental Protection agency, to wit... the fact that the defendant had failed to measure the level of benzene entering the aeration basin at the West Plant." [Emphasis added.] Rolling Stone readers are not served by reprinting, in full or in part, what can kindly be called Koch Industries' distortions.

Ironically, it is now Koch that accuses me of having written a "blatantly dishonest and misleading article." But in attempting to make that case, Koch itself continues to distort the record.

The chief "gotcha" point in Koch's write up regards the leak at the refinery it owns in North Pole, Alaska, contributing to the facility's shuttering this year. Koch writes: "He deceptively omits the undisputed facts that the off-site contamination existed long before Koch bought the refinery in 2004, that the contamination was not disclosed to Koch by the prior owner, and that once discovered Koch quickly and voluntarily began providing alternative water to the community."

The clear implication, in Koch's telling, is that the company is not the responsible party for the pollution in North Pole. This precisely contradicts two rulings by a state judge in Alaska, that Koch is solely responsible for the 2.5- by 3-mile plume of the refining solvent sulfolane that has fouled the groundwater for hundreds of residents there.

It is true, as Koch notes, that the refinery's sulfolane leak began under the previous owner. But the sulfolane leak continued under the ownership of Koch's refining subsidiary, Flint Hills, with the company's own documents reportedly estimating that 10,616 gallons of "high sulfolane-laden wastewater" leaked from a faulty sump system at the refinery from 2004, when Koch bought the plant, to 2009.

Koch's attempts to pin the refinery's pollution problem on the previous owner have gone nowhere in court. Contrary to Koch's claim that it took swift action to remediate the problem, the Alaska judge wrote that Koch had been warned of potential groundwater pollution and "failed to heed the advice it was given and failed to conduct a reasonable inquiry into the scope of the sulfolane contamination." The judge ruled that Koch's failure to seek redress from the previous owner within the statute of limitations have made the pollution at North Pole Koch's problem, alone.

Koch also does not mention that it has pressured state regulators to increase the acceptable amount of sulfolane pollution in groundwater a move that would hugely reduce Koch's cleanup liability.

Koch is correct that there is more to the story at North Pole, but these facts do not weigh in Koch's favor.

Let's now address Koch's bullet-points, in order:

Number One:
Mr. Dickinson makes a number of broad negative claims about Koch's environmental record, but only passing reference to the more than 900 awards for safety, environmental excellence, and community stewardship Koch has received since 2009 alone - information that we provided to Mr. Dickinson. In an article ostensibly about Koch's relationship with regulators, the fact that EPA has repeatedly praised Koch for a productive and collaborative approach is surely relevant to Rolling Stone readers. In addition, he excised our explanation of the long and continuing path to improve and enhance our environmental, health, and safety performance. He also ignored the discussion about our ongoing efforts to ensure we understand and meet the expectations of the EPA and other regulators, our communities, and our shareholders.

Here Koch appears to be criticizing me for not adequately doing their own PR for them. The story clearly remarks on the culture change, circa 2000, that made environmental compliance a focus at Koch Industries and quotes Holden about the company's quest for "10,000 percent" compliance. Given the company's recent pollution woes it seems that Koch is falling far short of that standard.

Number Two:

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